Market Performance and Planning Forum January 27, 2016 Last - - PowerPoint PPT Presentation

Market Performance and Planning Forum

January 27, 2016

Last updated: January 27, 2016

Objective: Enable dialogue on implementation planning and market performance issues

• Review key market performance topics
• Share updates to 2016 release plans, resulting from

stakeholders inputs

• Provide information on specific initiatives

– to support Market Participants in budget and resource planning

• Focus on implementation planning; not on policy
• Clarify implementation timelines
• Discuss external impacts of implementation plans
• Launch joint implementation planning process

Slide 2

10:00- 10:05 Introduction, Agenda Kristina Osborne 10:05 – 10:20 Customer Support Update Joanne Serina 10:20 – 11:40 Market Performance and Quality Update Nan Liu Guillermo Bautista Alderete 11:40 – 12:00 DMM Update – Growth of Renewables and Market Prices Gabe Murtaugh 12:00 – 1:00 Lunch 1:00 – 2:00 Release Update Adrian Chiosea 2:00 - 2:30 Policy Update Brad Cooper 2:30 3:00 Pricing Corrections Update Jim McClain

Market Performance and Planning Forum Draft Agenda – January 27, 2016

Customer Support Update

Joanne Serina Director, Customer Service and Industry Affairs

Slide 4

Market Performance and Quality Update

Nan Liu Manager, Market Development and Analysis Guillermo Bautista Alderete, Ph.D. Manager, Market Validation and Quality Analysis

Slide 5

Page 6

DA price higher than RT prices in December.

Page 7

Good price convergence at Malin across day ahead and real- time markets in November and December.

Page 8

Good price convergence at Palo Verde across day ahead and real-time markets in November and December.

Page 9

RT prices lower than DA prices in November and December for both NP 15 and SP 15.

RTD prices FMM prices

Page 10

Insufficient upward ramping capacity in ISO declined since October

Page 11

Insufficient downward ramping capacity remained low in November and December.

Page 12

Congestion revenue rights market revenue inadequacy without including auction revenues

Page 13

Congestion revenue rights market revenue inadequacy including auction revenues

Page 14

Exceptional dispatch remained at relative low levels

Page 15

Daily exceptional dispatches by reason

Page 16

Bid cost recovery continued to drop in December.

Page 17

Bid cost recovery (BCR) by Local Capacity Requirement area

Page 18

Minimum online commitment (MOC)

Page 19

Binding minimum online commitments in November and December

MOC Name Number (frequency) of enforced hours in November and December Humboldt 7110 1020 MOC PEASE 747 SCIT MOC 278 Orange County 7630 159 SDGE 7820 86 MOC Drum 3578826 12 MOC MOSS 3500764 9 MOC TABLE 3445566 6

Daily RA and Non-RA MOC for November and December 2015

Page 20

Page 21

Day-Ahead solar scheduled outputs continued to improve in November and December

Page 22

IFM under-scheduling of wind generation continued in November and December.

Page 23

Renewable (VERS) schedules and forecast in November - December

http://www.caiso.com/Pages/documentsbygroup.aspx?GroupID=EFF75C 2E-F28E-4087-B88B-8DFFAED828F8

Page 24

Monthly renewable (VERS) curtailment relatively low since May but increase some in December

Page 25

Hourly distribution of maximum renewable (VERS) curtailment in December

Monthly renewable (VERS) bid range trended upward in real-time

Page 26

Solar Wind

Monthly wind (VERS) downward flexibility in FMM

Page 27

Monthly solar (VERS) downward flexibility in FMM

Page 28

Page 29

ISO area RTCO and RTIEO stayed at low levels in November and December

2014 2015 RTCO $107,281,851 $50,277,774 RTIEO $109,338,025 $15,001,285 Total Offset $216,619,876 $65,279,059

Page 30

Price correction events in 2015 driven by software defects and process-related issues.

2 4 6 8 10 12 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Count of Events Process Events Software Events Data Error Events Tariff Inconsistency

EIM Price trends

Page 31

5-minute PACW Aggregate Price

5-minute PACE Aggregate Price

15-minute PACW Aggregate Price 15-minute PACW Aggregate Price

Power balance constraint infeasibilities in Nevada area have been minimal

Page 32 Last updated: January 27, 2016

0% 3% 6% 9% 12% 15% 1-Dec 2-Dec 3-Dec 4-Dec 5-Dec 6-Dec 7-Dec 8-Dec 9-Dec 10-Dec 11-Dec 12-Dec 13-Dec 14-Dec 15-Dec 16-Dec 17-Dec 18-Dec 19-Dec 20-Dec 21-Dec 22-Dec 23-Dec 24-Dec 25-Dec 26-Dec 27-Dec 28-Dec 29-Dec 30-Dec 31-Dec RTD Frequency Valid RTD Under-supply Infeasibility Correctable RTD Under-supply Infeasibility

Nevada prices for December

Page 33

• $30
• $20
• $10

$0 $10 $20 $30 $40 1-Dec 2-Dec 3-Dec 4-Dec 5-Dec 6-Dec 7-Dec 8-Dec 9-Dec 10-Dec 11-Dec 12-Dec 13-Dec 14-Dec 15-Dec 16-Dec 17-Dec 18-Dec 19-Dec 20-Dec 21-Dec 22-Dec 23-Dec 24-Dec 25-Dec 26-Dec 27-Dec 28-Dec 29-Dec 30-Dec 31-Dec Daily Average Price ($/MWh) FMM Prices RTD Prices

2015 v 2014 day-ahead load forecast

0.0% 0.5% 1.0% 1.5% 2.0% 2.5% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2014 2015

MAPE

2015 v 2014 day-ahead peak to peak forecast accuracy

0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2014 2015

MAPE

2014 v 2015 day-ahead wind forecast

0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2014 2015

MAE

2014 v 2015 day-ahead solar forecast

0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2014 2015

MAE

2014 v 2015 real-time wind forecast

0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2014 2015

MAE

2014 v 2015 real-time solar forecast

0% 1% 2% 3% 4% 5% 6% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2014 2015

MAE

Growth of Renewables and the Market

Gabe Murtaugh Senior Market Analyst, Department of Market Monitoring

Page 40

• Highlights on renewable generation from DMM’s upcoming

2015 annual report

– Annual trends in solar and wind generation – Implications of increased solar production on prices

• Highlights on market prices, and impacts from

renewables

Page 41

Presentation outline

Solar generation outpaced wind generation for the first time in 2015.

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5,000 10,000 15,000 20,000 25,000 30,000 2009 2010 2011 2012 2013 2014 2015 Generation (GWh) Wind Solar

Solar generation outpaced wind generation for the first time in 2015.

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• Solar generation increased by about 40 percent from

2014 to 2015, making it the largest source of renewables. – This follows growth of over 100 percent the last few years.

• Solar generation totaled about 16,000 GWh in 2015, up

from 11,500 GWh in 2014.

• Wind generation totaled about 12,500 GWh in 2015,

down from generation of over 13,000 GWh during the prior two years.

In several months, solar generation was higher than both wind and hydro generation in 2015.

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500 1,000 1,500 2,000 2,500 3,000 3,500 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Hourly Average MW Hydro Wind Solar

Solar generation performs differently from wind.

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• Solar output, compared to wind, was less variable over

the course of the year.

• More solar generation is scheduled in the day-ahead

market than wind relative to real-time schedules.

• Solar generation is highest during warm summer months

when loads in the ISO are the largest. – Solar generation routinely satisfied over 10 percent of the total load, during the middle of the day, on the days with the highest loads.

• Solar generation ramps down as loads for the system

reach their peak, resulting in challenges when meeting the daily peak and making up for declining solar output.

Solar generation has begun to change how prices are formed in day-ahead and real-time markets.

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5,000 10,000 15,000 20,000 25,000 30,000 35,000 $0 $10 $20 $30 $40 $50 $60 $70 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Average Load (MW) Average hourly price ($/MWh) Operating hour 5-minute price 15-minute price Day-ahead price Average hourly load Net Load

Solar generation has begun to change how prices are formed in day-ahead and real-time markets.

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• Predictable patterns for solar generation create a new

net load, which tracks closely with system prices.

• Large amounts of solar generation during the middle of

the day lower early afternoon prices.

• As solar generation decreases and system load peaks,

resources are needed to come on-line to make up for lost solar generation and additional demand. – This causes prices to rise and may cause price spikes in the real-time markets due to both supply and load ramping.

Real-time and day-ahead prices track net load.

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• Real-time and day-ahead prices track fairly closely to net

load, with peaks in the morning and the evening.

• Generally, day-ahead and real-time prices follow a

similar pattern.

• There was a premium with day-ahead prices compared

to both real-time markets.

• The greatest separation between day-ahead and real-

time prices occur when solar generation is greatest.

• Prices in the 5-minute market were the most volatile,
• wing to price spikes from a more limited ramping

availability.

Release Plan Update

Adrian Chiosea Manager, Strategic Initiative Management

Page 49

Release Plan 2016

Early 2016

• Capacity Procurement Mechanism Replacement
• Reliability Services Initiative
• Commitment Cost Enhancements Phase 2 (remainder)
• Post Implementation OMS Enhancements

2016

• Application Identity Management (AIM) Enhancements
• Expanding Metering and Telemetry Options Phase 2
• Demand Response Registration Enhancements
• RIMS Functional Enhancements
• Available Balancing Capacity
• Bidding Rules Enhancements – Part A

Fall 2016

• BAL-003 Compliance
• Reliability Services Initiative Phase 1B
• Flexible Ramping Product
• BCR modifications and VER settlement
• Bidding Rules Enhancements – Part B
• Energy storage and distributed energy resources (ESDER)
• Commitment Cost Enhancement Phase 3
• Acceptable Use Policy - CMRI Moved from Early 2016
• OMAR Replacement
• PIRP System Application Decommissioning
• Post Implementation OMS Enhancement
• Energy Imbalance Market (EIM) Year 1 Enhancements Phase 2
• Energy Imbalance Market (EIM) 2016 Arizona Public Service (APS)
• Energy Imbalance Market (EIM) 2016 Puget Sound Energy (PSE)

Subject to further release planning:

• ADS User Interface Replacement
• Stepped Constraints
• Reactive Power Requirements and Financial Compensation
• Contingency Modeling Enhancements

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Early 2016 Release Market Simulation

Market Simulation Dates – RSI, CPM, Commitment Costs Phase 2, and OMS Enhancements Nov 9 – Dec 17, 2015: Session 1 (Structured and Unstructured) - completed February 8 – March 11, 2016: Session 2 (Unstructured and Structured E2E) updated Link to Early 2016 Release Market Simulation Plan - http://www.caiso.com/Documents/MarketSimulationPlanEarly2016Release.pdf

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Early 2016 Settlements Release

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ISSUE SUMMARY BPM IMPACTED New and updated BPM Configuration guides in support of the Capacity Procurement Mechanism (CPM) Replacement Initiative PRR# 884 (CC 6460, CC 6470, CC 6482, CC 6488, CC 7891, CC 7896, CG PC MD TAC Area and CPM ) New and updated BPM Configuration guides for assessing resources with RA capacity in support of the Phase 1 of the Reliability Services Initiative PRR# 885 (CC 4515, CC 4999, CC 6011, CC 6455, CC 8830, CC 8831, CC 8835, CG PC IFM Net Amount, CG PC Metered Energy Adjustment Factor, CG PC MSS Netting, CG PC RA Availability Incentive Mechanism, CG PC RTM Net Amount, CG PC RUC Net Amount, CG PC Start-Up and Minimum Load Cost ) Terminated BPM Configuration guides in support of implementation of the Capacity Procurement Mechanism Replacement and Reliability Services Initiatives PRR 886: ( CC 7872, CC 7873, CC 7874, CC 7875, CC 7876, CC 7877, CC 7880, CC 7881, CC 7882, CC 7883, CC 7884, CC 7885, CC 7886, CC 7887, CC 8820, CC 8821, CC 8824, CC 8825, CC 8826, CC 8827, CG PC Standard Capacity Product )

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Milestone Date Status Configuration Guides Posted December 8, 2015 FIRST DRAFT Configuration Output File Posted December 14, 2015 MAP Stage Deployment January 13, 2016 SECOND DRAFT Configuration Output File Posted January 14, 2016 Market Simulation: Trade Dates to be Posted Calendar dates of Posting February 9 – March 10, 2016 February 16 – March 17, 2016 Pre-Production Configuration Output File Posted March 14, 2016 Production Deployment March 28, 2016 FINAL Configuration Output File Posted March 28, 2016

Early 2016 Settlements Release

Early 2016 – Capacity Procurement Mechanism Replacement (CPM)

Milestone Details/Date Application Software Changes

Competitive Solicitation Process (CSP): CSP replaces the existing administrative price process for annual, monthly and intra-monthly CPM events for flexible and generic RA capacity. CSP will cover all events that allow the ISO to procure additional capacity. CIRA: − Bid Submittal system for SCs to submit capacity bids (not an existing bid type) − Capacity bids to implement new validation rules (not an existing bid type) − Capacity Bid submittal to be on a yearly, monthly, and intra-monthly level − LSE/LRA deficiency calculation to be performed for CSP for Generic and Flexible RA data − Existing CPM calculation to be deprecated for trade dates after the effective date of implementation. − Manage import allocation and bilateral trades of import allocation Settlements: Settlements will need new CPM formulas that will result in charge code impacts. Reporting: If an annual or monthly CPM occurs greater than two times (over a rolling 24 month period) or more than 50% of the LSE’s RA requirement is CPMed, a report must be given to Market Participants. OASIS: − Publish all finalized offers into the competitive solicitation process on a rolling five-quarter delay. (Deferred) Page 54

Milestone Details/Date Status BPM Changes

Reliability Requirements – PRR issued 11/4/15 Market Instruments – issue PRR 1/8/16

• Billing & Settlements – PRR issued 1/11/16

Business Process Changes

− Solicitation for soft offer cap. Timeline for submittal needs to be defined. − Submittal process for annual/monthly CPM bid submittal − New business process for amount of capacity being relied on (non-RA from partial RA) − New process for Competitive Solicitation Process (annual/month/intra-monthly)

Board Approval

February 5, 2015

External BRS

March 31, 2015

Tariff

Filed: May 26, 2015 FERC Approved: October 1, 2015

Technical Specifications

CIRA Session 1  Fall 2016, MPs will use UIs OASIS Session 2  Fall 2016

Draft Configuration Guides

November 23, 2015 Session 2

External Training

October 21, 2015: Session 1 – Onsite w/Webinar, Full Day (combined w/ CPG Call)

• Training Materials – posted SP & RP page on 10/19

January 6, 2016: Session 2 - Onsite w/ Webinar option, Full Day

• Training Materials – post 1/5

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Early 2016 – Capacity Procurement Mechanism Replacement (cont.)

Milestone Details/Date Status Market Simulation

November 9 – December 17, 2015: Session 1, Structured

• Scenarios –posted on Release Planning Page on 7/30/15
• Scenarios w/timeline – posted on RP page on 10/19
• CIRA User Guide – posted on RP page on 11/24

February 8 – March 11, 2016: Session 2 (Delayed 1 Month)

• Structured Scenarios – posted on Release Planning page on 8/21/15
• Structured Scenarios: 2/9 – 2/26 (New)
• Unstructured Scenarios: 2/26 – 3/11 (New)
• SIBR Rules, Release Notes, Specs posted – 12/11
• CIRA User Guide – 1/18 (Updated)
• 3-Day Onsite Market Simulation (Attendance Optional) 2/22 – 2/24

(Updated)

Production Activation

1/19/2016: Session 1 3/24/2016: Session 2 (Updated) 4/1/2016: Effective Date (Updated)

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Early 2016 – Capacity Procurement Mechanism Replacement (cont.)

Milestone Details/Date

Application Software Changes

CIRA: − Manage new NQC/EFC process request for resource types. This will impact both internal users and Market Participants − Manage Import Allocation (CPM Replacement initiative is covering this scope but is needed for this initiative) − Manage RA obligation (taking into consideration substitution capacity and replacement capacity as RA capacity) will impact RA, Settlements, market, and outage. The output of CSP will be needed − Publish RA Obligations externally − Display Comparative snapshot of DA/RT obligation (outages, energy bids, RA obligation). Display input of RAAIM calculations − Display SCP and CPM availability calculation output for historic trade dates − Creation of substitution rules for flexible resource adequacy resources − Modify existing DA/RT generic substitution rules − DA substitution timeframe shall change from 6 AM to 8 AM − Enable the release of substitute capacity for generic and flexible resources − Allow imports to substitute for other imports and CAISO system resources. The RA obligation will be at a daily level − Use result of Pre-qualification analysis (the pre-qualification analysis is a manual process) for real time substitution validation − API for substitution and release functionality − Enable Generic CPM substitutions − Enable Flexible CPM substitutions − Build Submit & Retrieve APIs to support Substitutions (4 types) and release of sub capacity − Substitution will now be in CIRA − Addition of RAAIM exempt and planned outage exemption flag − Allow the outage correction process to exempt outage from RAAIM calculations up to 5 business days OMS: − Add 5 nature of work attributes and various validations − Remove SCP Exempt flag from display Page 57

Early 2016 – Reliability Services Initiative (RSI) – 1A

Milestone Details/Date Status Application Software Changes

Masterfile: − Will store Use Limit Plan. There will be a new template (ULPDT – Use Limit Plan Data Template) RAAM: − Decommission RAAM Settlements:

• RAAIM (RA Availability Incentive Mechanism) NEW – replaces SCP for backstop.

Current SCP will retire with implementation of RAAIM. Will assess whether generic and flexible RA resources comply with MOO and better captures use limited resource availability.

• New charge code changes are needed for implementation of the RA

Reporting:

• Report on the effectiveness of the RAAIM results (1 year after implementation)

(Deferred) Other:

• Modification of Use Plan with new validation rules
• LSE cost allocation methodology needs to automated.
• Publish list of all available prequalification combinations

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Early 2016 – Reliability Services Initiative (cont.) – 1A

Milestone Details/Date Status BPM Changes Reliability Requirements - issued PRR #888 on 1/12/16 Outage Management - issued PRR #889 on 1/12/16 Billing & Settlements - issued PRR on 1/11/16 Business Process Changes − Process to assign NQC values to NGR/PDR/DG resources − Process for PDR/NGR/DG testing − Process for RA Availability Incentive Mechanism (RAAIM). Must retire SCP business process flows. − Modify DA/Real Time Substitution Process − Process for allocating year end unallocated RA Availability Incentive Mechanism (RAAIM) funds Board Approval March 26, 2015 External BRS March 31, 2015 Tariff Filed: May 28, 2015 FERC Approved: October 1, 2015 Technical Specifications CIRA Session 2  Fall 2016, MPs will use UIs Masterfile Session 2

• posted tech spec 9/24 on Release Planning Page
• posted ULDT 9/11 to RP page
• posted ULR documentation/ sample templates to RP page on 12/4

OMS Session 2

• posted tech spec 12/2

Draft Configuration Guides November 23, 2015 Session 2

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Early 2016 – Reliability Services Initiative (cont.) – 1A

Milestone

Details/Date

Status

External Training October 21, 2015: Session 1- Onsite w/Webinar, Full Day (combined w/ CPG Call)

• Training Materials – post 10/19
• NQC Template – posted RP page on 10/19

January 6, 2016: Session 2 – Onsite w/ optional Webinar, Full Day

• Training Materials – post 1/5

Market Simulation November 9 – December 17, 2015: Session 1

• Scenarios – posted on Release Planning page on 7/30/15
• Scenarios w/timeline – posted on RP page on 10/19
• CIRA User Guide – posted 11/24

February 8 – March 11, 2016: Session 2 (Delayed 1 Month)

• Structured scenarios posted on Release Planning page on 8/21/15
• MF/OMS Market Sim inputs: 1/19 – 2/7 (New)
• Structured Scenarios: 2/9 – 2/26 (New)
• Unstructured Scenarios: 2/26 – 3/11 (New)
• Scenarios – posted 8/21/15 on RP page
• MF UI User Guide – 1/6
• OMS User Guide – embedded in application
• CIRA User Guide – 1/18 (Updated)
• 3-Day Onsite Market Simulation (Attendance Optional) 2/22 – 2/24 (Updated)

Production Activation 1/19/2016: Session 1 3/24/2016: Session 2 (Updated) 4/1/2016: Effective Date (Updated)

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Early 2016 – Reliability Services Initiative (cont.) – 1A

Important Announcements: – The ISO has updated Reliability Services Initiative (RSI) documentation to reflect the listed exemptions in section 40.9.2(b) of the filed RSI Tariff language, which includes exemptions for all resources that qualify as Variable Energy Resources and does not specifically mention solar and wind resource types. (New) – Notification for March 2016 RA process: To Be REVISED

• This is to inform scheduling coordinators that customer interface for resource adequacy

(CIRA) deployment to production on 1/12/16 has been delayed to 1/19/16. Please continue to use the existing RA plan template for March 2016 RA compliance month. The T-45 due date to submit RA/Supply plans for March compliance month in CIRA is 1/15/16. The Monthly CSP offers are due in CIRA by COB 1/22/16 for March RA compliance month.

• Notification send from the 1/12/16 from RR mailbox
• For more information/questions please submit a CIDI ticket.
• CIRA R/O Access Disabled

– For those with R/O access to CIRA: Your access will be disabled while we fix a system issue. If you need access in the interim, please contact your POC for R/W access to CIRA. You will be notified when your R/O access is re-activated.

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Early 2016 – CPM & RSI Announcements

Market Simulation, Session 2: RSI/CPM/CCE2 - Delayed to 2/8 Start Information : – Session 2 Market Sim delay 2 weeks to start 2/8 – 3/11/16.

• Structured scenario testing will be 2/9– 2/26
• Unstructured scenarios testing will be 2/26– 3/11

– Advisory Statements - 1/19 – 1/22 (TBD) will be used by Settlements to issue sample Advisory Statements – All structured scenarios will remain the same, but their start dates will move out 1 week as follows:

• RA Substitution (1B) – to start 2/9
• RAAIM Incentive, Penalty, Exemption (2B, 3B, 4B) – to start 2/15
• CPM Payments & Supplemental Revenue (6B, 7B, 8B) – to start 2/22

– Submission of OMS outages and ULPDT in preparation of Market Simulation is as follows:

• OMS Outage submission – to start 1/19. MPs will need to submit new outages based on

new start date of Market simulation. The requirement to submit outages at least seven business days prior to the start of the outage will be deactivated for market simulation.

• ULPDT submission – to start 1/19. Market Notice to go out with more details. The

requirement to upload the template at least five business days prior to the effective start date of the use limitation will be deactivated for market simulation.

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Early 2016 – CPM & RSI Market Simulation

Use Limited Plan templates: – Note Emergency PRR 868 was issued as an interim solution, and ask that you submit template via CIDI instead of email. Once RSI goes live, all templates will be submitted via Masterfile UI. – CAISO would not be copying over MF data from MAP Stage to Production Use Limited Plan Data Template Draft Timeline: – 1/19/16: Start of Market Sim for MF in MAP Stage – 3/11/16: End of Market Sim in MAP Stage (Updated) – 2/16/16 (tentatively): MPs to review eligibility checklist to determine their Use Limited flag setting (Y/N) and upload ULPDT based on following criteria: (Updated)

• If no flag changes are required. MPs can upload their March ULPDT in MF into production

environment

• If flag changes are required, MPs will need to make the changes and wait until the MF runs and

refreshes overnight. CAISO will approve the new flag setting within a day. MPs will be notified of approval via the normal process.

• If CAISO rejects the current flag setting, MPs will need to fix the flag and wait for the MF to refresh.

Note that ULPDT cannot be uploaded until the flag setting is approved.

• The ULPDT will come into CAISO system as unapproved. CAISO will review and approve these

templates on a first come, first served bases.

• Nothing in Settlement is binding until 5/1/16 due to the two-month advisory period.

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Early 2016 – CPM & RSI Announcements

February 22 - 24, 2016: 3-Day Onsite Market Simulation, Session 2 Delayed 2 weeks The ISO will hold an OPTIONAL onsite market simulation for market participants in addition to the already scheduled market simulation session from 2/8– 3/1/16. (New) Information : – Onsite market simulation for Session 2 will be 2/22– 2/24/16 – 2/22 & 2/23 will be structured, and 2/24 will be unstructured – Mini-monthly Settlements statements are not available during the onsite market simulation, but are available for the 3-week offsite session – MPs need to bring their own laptops, because they have their certifications on them. – Please RSVP by 2/15 to the RR mailbox (reliabilityrequirements@caiso.com)

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Early 2016 – CPM & RSI Onsite Market Simulation

Early 2016 – Commitment Costs Phase 2

Milestone Details/Date Status Application Software Changes For the Early Jan 2016 release, the project will

• Clarify definition, qualifications, and requirements for use-limited resources
• Implementation of the use limited definition (No longer applicable)
• Implement revised must-offer rules
• Impacted Systems:
• MF
• SIBR

CCE2 Early 2016 release implementation will be coordinated as part of the Reliability Services Initiative (RSI) project

Board Approval

• Yes. March 26-27, 2015

Tariff Filed: May 28, 2015 Approved in Part: September 9, 2015

(FERC rejected the proposed revisions to the definition of “use limited resources”, but approved all other tariff revisions.)

BPM Changes Market Operations (Use Plan) – issued PRR #887 on 1/11/16 Business Process Changes No External Business Requirements November 24, 2015 Technical Specifications No External Training

January 6, 2016: Session 2 – Onsite w/ optional Webinar, Full Day

• Training Materials – post 1/5

Draft Configuration Guides No Market Simulation

February 8 – March 11, 2016: Session 2 (Delayed 2 week)

Production Activation Deployment Target - 3/24/2016 (Updated) Effective Date – 4/1/2016 (Updated)

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Early 2016 – Post Implementation OMS Enhancements

Milestone Details/Date Status Application Software Changes OMS Enhancements project will implement the following functionalities:

• Transmission Outage Report Enhancements
• Manage Broadcast Status Update (deferred until Fall 2016)
• Manage RetrieveResourceOutage API - add Invalid and Inconsistent flags
• The API will be backwards compatible. OMS will support both V1 and

V2 of B2B submit and retrieve outage API. The same applies to the transmission outage API as well.

• System change to validate the "ChangeThreshold" only at time of submission
• f a change request, and allow change request to be accepted or rejected at

any time. The project is also addressing the backlog of known issues. Other roadmap items (Substitutions, Additional Natures of Work, and Removal of SCP exempt flag/Inclusion of RAAIM exempt flag) will be part of the Reliability Services Initiative (RSI) project. The implementation will impact the following systems:

• Outage Management System (OMS)
• Market Systems (IFM/RTN)
• EMS
• CIRA
• Settlements

Page 66

Early 2016 – OMS Enhancements (Continued)

Milestone Details/Date Status

Board Approval

N/A

Tariff

No tariff changes are anticipated for this initiative

Business Process Changes

No business process changes are anticipated for this initiative

External Business Requirements

BRS Target Posting Date: Sep 18, 2015

Technical Specifications

Tech Specs Target Posting Date: Sep 30, 2015

BPM Changes

Outage Management, and Market Operations BPMs will be updated by the end of January 2016

External Training

TBD

Draft Configuration Guides

N/A

Market Simulation

Unstructured – Feb 8 to March 11, 2016

Production Activation

Deployment – March 24, 2016 Activation Date – April 1, 2016

SLIC Decommissioning

Disable external SLIC API and UI access: January 15, 2016

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2016 – Application Identity Management (AIM) Enhancements

Milestone Details/Date Status Application Software Changes AIM: Adding endorsed user functionality BPM Changes None Business Process Changes Manage Operations Support & Settlements Board Approval N/A External Business Requirements N/A Technical Specifications N/A Draft Configuration Guides N/A External Training 12/1/2015 Tariff N/A Production Activation Endorsed user functionality – February 10, 2016 Activation will not cause any loss of access to production data

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2016 – Expanding Metering and Telemetry Options Phase 2

Milestone Details/Date Status

Application Software Changes Distributed Energy Resource Provider (DERP) Agreement: 1. General functions of the DERP,

• Offer Energy and AS: aggregated resources in Sub-Lap
• Provide ISO with accurate Information
• Responsible for operating and maintain DER

2. Specify data concentrator functionality for real time monitoring, control and after the fact metering data

• disaggregate ISO signals to sub-resources; obtain a resource response
• aggregate sub-resource operational and settlement meter data within a sub-Lap

3. Define the provision of technical and operational information to the ISO,

• metering and communications requirements,
• submission of economic bids and self-schedules and
• provision of ancillary services

4. Identify responsibility for fulfilling the terms of the agreement

• penalties and sanctions, cost responsibility, dispute resolution, representations and

warranties, liability, uncontrollable forces and other miscellaneous terms BPM Changes Metering, Direct Telemetry Revised straw proposal May 12, 2015 Draft final proposal June 10, 2015 Board Approval July 16, 2015 External Business Requirements N/A Updated BPMs February 1, 2016 Technical Specifications N/A

Draft Configuration Guides N/A Tariff filing Draft language posted, Stakeholder discussions began October 1, 2015 Production Activation April 1, 2016

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2016 – Demand Response Registration Enhancements

Milestone Details/Date Status Application Software Changes Enhance Demand Response Registration functionality and processes Develop new registration user interface for DRRS Develop new APIs for support of enhanced registration processes

• CPG meeting (business process) on January 25, 2016 - complete

BPM Changes Metering; Settlements & Billing Business Process Changes Automation of internal registration-related processes Board Approval N/A External Business Requirements June 4, 2015 Clarified, July 3, 2015 Technical Specifications September 18, 2015 Draft Configuration Guides N/A User Training Market Simulation March 21 – 23 March 23 – April 13, 2016 Tariff N/A Production Activation April 28, 2016

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2016 – RIMS Functional Enhancements

Milestone Details/Date Status Application Software Changes Functional enhancements resulting from the Customer Partnership Group CPG. More details to be provided in the future. BPM Changes Generator Interconnection and Deliverability Allocation Procedures Generator Interconnection Procedures Managing Full Network Model Metering Generator Management Transmission Planning Process Business Process Changes N/A Board Approval N/A External Business Requirements N/A Updated BPMs N/A Technical Specifications N/A Draft Configuration Guides N/A Customer Partnership Group 10/16/15 Tariff N/A Production Activation App & Study – March 8, 2016 Generation, Transmission and Queue Management - July 29, 2016

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2016 – Year 1 Enhancements 2015 - Available Balancing Capacity

Milestone Details/Date Status

Application Software Changes SIBR: EIM Participating Resources to include their assigned Regulation capacity in their Energy Bids submitted to the EIM. RTM:

• The market will not dispatch this capacity, unless it is required to resolve a power

balance infeasibility in an EIM BAA.

• Formulate the solution so that the energy from the Regulation dispatch is consumed

within the BAA and does not exit through the EIM Transfer;

• Regulation should only be dispatched to the extent necessary to resolve power

balance infeasibility; it should not be used to displace other capacity made available in the BAA for EIM participation.

• If the infeasibility persists after dispatching all available Regulation, the price will be

set at the applicable administrative price. Board Approval N/A Tariff

Approved on December 17, 2015. ISO requested waiver to go-live no later than March 1, 2016. http://www.caiso.com/Documents/Dec17_2015_OrderAcceptingComplia nceFiling_AvailableBalancingCapacity_ER15-861-006.pdf BPM Changes EIM BPM Draft changes due January 27, 2016 Business Process Changes N/A External Business Requirements Please see Draft EIM BPM changes. Technical Specifications N/A External Training N/A Draft Configuration Guides Implemented with Year 1 Enhancements Fall 2015 Release Market Simulation N/A Production Activation February 16, 2016

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2016 – Bidding Rules Enhancements – Part A

Milestone Details/Date Status

Application Software Changes This initiative combines consideration of energy and commitment cost bidding rules to refine and improve alignment between these rules. This initiative will review the ISO’s current rules for energy and commitment cost bidding flexibility and resource characteristics definitions. This initiative will balance the benefits of allowing market participants to reflect actual costs through increased bid flexibility against the increased potential for inefficient market outcomes by inappropriately changed bid prices. This phase of the bidding rules enhancements will only focus on resolving the market efficiency caused by rerating the Minimum Load Cost (MLC) where the ISO is committing less economic resources. DAM/RTM: Change of minimum load cost (MLC) calculation. Calculate the actual Minimum Load Costs (MLC) based on the heat rate of the resource using a DEB integration method where the incremental DEB costs are added to the master file minimum load costs at the re- rated Pmin level. Support hourly MLC in optimization engine. Support rules for handling multiple Pmin rerates within same hour. This shall also apply to MSG resources per configuration. BPM Changes Market Operations Business Process Changes N/A Board Approval February 2016 External Business Requirements February 5, 2016 Technical Specifications TBD Draft Configuration Guides TBD Market Simulation TBD Tariff Yes Production Activation May 1, 2016

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Fall 2016 – BAL-003 Compliance

Milestone Details/Date Status Application Software Changes ISO expected Frequency Response Obligation (FRO): 752 MW or 258 MW/0.1Hz Phase 1:

• Revise Tariff to include requirements for all participating synchronous

generators with governor controls

• Develop “look-ahead” tool to assess PFR capability and anticipated deficiency
• Revise Tariff require Contingency Only Reserve
• Include frequency response performance requirement for the resources
• Allocate any non-compliance penalties associated with BAL-003-1

BPM Changes Yes - TBD Business Process Changes TBD Board Approval 3/24 – 3/25/16 (Updated)

• Draft Final Proposal due 2/2/16 (Updated)
• Stakeholder call is 2/9/16 (New)
• Stakeholder comments due 2/16/16 (New)

External Business Requirements TBD Technical Specifications TBD Draft Configuration Guides TBD Market Simulation TBD Tariff Yes Production Activation Fall 2016

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Fall 2016 – Reliability Services Initiative Phase 1B

Milestone Details/Date Status

Application Software Changes

• Default flexible qualifying capacity provisions for phase 2 consideration (we might

need data collection performed in order to support RSI Phase 2

• Redesign of Replacement Rule for System RA and Monthly RA Process
• RA Process and Outage Rules for implementation for 2017 RA year
• Scope not delivered in RSI Phase 1A (Grandfathered Contracts, RAAM

Decommissioning – SCP & CPM screens from RAAM to CIRA, Acquired Contracts, OASIS reporting, web services related to APIs for CSP offers, APIs for Generic/Flex Substitutions, and Release of Generic/Flex Subs – UI & API)

• Impacted Systems:
• CIRA
• OMS
• Integration

Board Approval March 26, 2015 Tariff TBD BPM Changes Outage Management – September 8, 2016 Reliability Requirements – September 8, 2016 Business Process Changes Manage Market & Reliability Data & Modeling External Business Requirements March 2016 Technical Specifications Yes External Training Yes Draft Configuration Guides Yes Market Simulation July 5 – July 29, 2016 Production Activation Fall 2016

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Fall 2016 – Flexible Ramping Product

Milestone Details/Date Status

Application Software Changes

• RTD/FMM – Add FRU/FRD awards and prices, modify the objective function, add

System and BAA FRP requirement, add resource constraints

• SIBR – No FRP bidding allowed, no FRP self-provision
• CMRI – Publish the resource FRP awards and prices, 5 minute movement allocation
• OASIS – Publish the min and max FRU and FRD requirements, confidence band

demand curve and shadow price for each BAA and the EIM area, Publish the movement allocation per category

• Settlements – Financially settle in both the RTD and the FMM

BPM Changes Market Instruments, Market Operations, Settlements & Billing Business Process Changes Manage operations Support and Settlements, Support Business Services, Support Customers & Stakeholders Board Approval

• Updated Technical Appendix posted November 11th
• Market Participant workshop completed November 18th
• Revised Final draft proposal published December 17th
• Board: February 2016

External Business Requirements TBD Technical Specifications TBD Draft Configuration Guides TBD Market Simulation TBD Tariff TBD Production Activation Fall 2016 implementation

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Fall 2016 – BCR Modifications and VER Settlements

Milestone

Details/Date

Status Proposed scope Policy Topics:

• Ramp rate for variable energy resources.
• Residual imbalance energy settlement for economic bidding variable energy

resources.

• Persistent deviation metric applied to variable energy resources.
• Default energy bids for economic bidding variable energy resources.
• Day-ahead metered energy adjustment factor.
• Tariff clarifications following market issues bulletin.

BPM Changes Market Operations (System Operations), Settlements and Billing Board approval July, 2015 External Business Requirements Posted January 4, 2016 on Release Planning page Market Simulation July 5 – July 29, 2016 Technical Specifications TBD Draft Configuration Guides TBD Tariff Filing TBD Production Activation Day-Ahead (DA) Metered Energy Adjustment Factor changes, and Residual Imbalance Energy (RIE) changes Fall 2016

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Fall 2016 – Bidding Rules Enhancements – Part B

Milestone Details/Date Status Application Software Changes Through this initiative the ISO will evaluate the following: 1) unrestricted flexibility

• f resources to change energy bid prices between the day-ahead and real-time

markets, and across real-time hours; 2) restrictions on commitment cost changes between and within the day-ahead and real-time markets; and 3) verification of generator resource characteristics. BPM Changes TBD Business Process Changes TBD Board Approval March 2016 (Order 809 July, 2015 Board, No change for IFM timing) External Business Requirements TBD Technical Specifications TBD Draft Configuration Guides TBD Market Simulation TBD Tariff TBD Production Activation TBD

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Fall 2016 – Energy Storage and Distributed Energy Resources (ESDER) Policy

Milestone

Details/Date

Status

Proposed scope 2015 scope:

• 1. NGR model enhancement:

a. Update documentation on NGR to ISO BPMs to capture material and clarifications b. Clarify how the ISO uses state of charge in market optimization. c. Allow initial state of charge as a submitted parameter in the day-ahead market. d. Allow option to not provide energy limits or have ISO co-optimize an NGR based on state of charge

• 2. PDR/RDRP enhancement:

a. Support alternative performance evaluation method: MGO b. Support Baseline Type-II

• 3. Multiple use applications:
• a. DERA provides services to distribution system and wholesale market
• b. DERA provides services to end-use customers and wholesale market

Include provisions: 1. Daily SQMD for DERA; 2. Settle DERA deviation through UIE; 3. Not address potential double payment; 4. No limitation DERA for distribution system; 5. treat PDR/RDRR as serve end-use and wholesale market.

BPM Changes

Multiple BPMs. Proposed scope May 13, 2015, June 25, 2015 Policy proposal Revised straw proposal September 17, 2015 Draft Final proposal Nov 2nd, 2015 Board approval Feb 2016 External Business Requirements Feb, 2016 Technical Specifications TBD Tariff filing TBD Production Activation TBD, tentatively Fall 2016

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Milestone Details/Date Status Application Software Changes

• 1. Clarify registration process and documentation to determine opportunity

costs

• 2. Each submission evaluated on a case-by-case basis to determine if the

ISO can calculate opportunity costs

• ISO calculated; Modeled limitation
• Market Participant calculated; Negotiated limitation
• 3. Enhanced definition of “use-limited” in response to FERC’s rejection of

the proposed definition in Cost Commitment Enhancements Phase 2 BPM Changes Market Instruments Business Process Changes Level II – Manage Reliability Requirements Level II – Manage Day Ahead Market Board Approval March 2016 External Business Requirements TBD Technical Specifications TBD Draft Configuration Guides TBD Market Simulation TBD Tariff TBD Production Activation Fall 2016

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Fall 2016 – Commitment Cost Enhancements Phase 3

Fall 2016 – Acceptable Use Policy – CMRI

Milestone Details/Date Status Application Software Changes Scope includes enforcement of Acceptable Use Policy for CMRI services to support the full implementation of 1 call per service per identity (as designated by certificate) every 5 seconds. BPM Changes N/A Business Process Changes N/A Board Approval N/A External Business Requirements N/A Updated BPMs N/A System Access Document N/A Draft Configuration Guides N/A Market Simulation July 5, 2016 – July 29, 2016 Tariff N/A Production Activation October 1, 2016

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Fall 2016 – OMAR Replacement

Milestone Details/Date Status Application Software Changes

The scope of the project is to replace the current OMAR Online application with a new CUI framework based interface and provide standard B2B web services integration. B2B services will be modified to align with CIM standard and to convert to GMT, and the existing FTP solution will be replaced. The new solution will also remove the custom OMAR certificates by leveraging the CAISO Multiple Application (CMA) certificates.

• Targeted API review sessions to scheduled for February
• API integration targeted for testing in April, in time for unstructured market sim
• UI delivery targeted for end of May, with active CPG involvement

BPM Changes

Metering and Definitions & Acronyms (references to systems may need to change)

Business Process Changes

Potential Level-II business process changes under –

• Manage Market & Reliability Data & Modeling
• Manage Operations Support & Settlements

Board Approval

Potentially needed – Dates TBD

External Business Requirements

Date TBD

Technical Specifications

OMAR Online Replacement – December 21, 2015

Draft Configuration Guides

N/A

Market Simulation

Date TBD

Tariff

N/A

Production Activation

Fall 2016

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Fall 2016 – PIRP System Application Decommissioning

Milestone

Details/Date Status

Application Software Changes Transition PIRP Hour-Ahead/Day-Ahead forecast reports and associated APIs to the CMRI system. Will post corresponding artifacts as they become available. BPM Changes CMRI Technical Specification; New APIs will be described. Business Process Changes MPs will receive the VER reports from CMRI rather than PIRP. Board Approval N/A External Business Requirements 28 August, 2015 Updated BPMs N/A Market Simulation July 5 – July 29, 2016 Technical Specifications March 2016 Draft Configuration Guides N/A Customer Partnership Group N/A Tariff N/A Production Activation Fall 2016

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Fall 2016 – Post Implementation OMS Enhancements

Milestone Details/Date Status Application Software Changes OMS Enhancements project will implement the following functionality:

• Manage Broadcast Status Update

The implementation will impact the following systems:

• Outage Management System (OMS)
• Market Systems (IFM/RTN)
• EMS
• CIRA
• Settlements

BPM Changes TBD Business Process Changes Yes Board Approval N/A External Business Requirements BRS Posting Date: Sep 18, 2015 Technical Specifications Tech Specs Posting Date: Sep 30, 2015 Draft Configuration Guides N/A Market Simulation Dates - TBD Tariff N/A Production Activation Fall 2016

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Fall 2016 – EIM Year 1 Enhancements Phase 2

Milestone Details/Date Status Application Software Changes

• EIM transfer limit congestion treatment: (MF, RTM, EIM transfer congestion

component by BAA share)

• Dynamic competitive assessment for market power mitigation of EIM transfer limits:

(IFM/RTM, LMPM configuration)

• Use of e-tags to establish base schedule for import and export: (BSAP, EIM entity

submit base schedule)

• Outage reporting to Peak Reliability Coordinator (OMS, service provide to EIM entity)

BPM Changes Energy Imbalance Market, Settlements and Billing Business Process Changes Manage market and grid, Manage operations support and Settlements Board Approval November 5-6, 2015 External Business Requirements February 5, 2016 Technical Specifications TBD Draft Configuration Guides TBD Market Simulation July 5 – July 29, 2016 Tariff Yes Production Activation Fall 2016

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Fall 2016 – EIM APS

Milestone Details/Date Status Application Software Changes Implementation of Arizona Public Service as an EIM Entity. BPM Changes EIM BPM will be updated to reflect new modeling scenarios identified during APS implementation and feedback from APS. Business Process Changes N/A Board Approval N/A External Business Requirements N/A Technical Specifications No changes expected Draft Configuration Guides No changes expected Market Simulation ISO to promote market network model including APS area to non- production system and allow APS to connect and exchange data in advance of Market Simulation by 3/2/16. July 5 – July 29, 2016 Parallel Operations August 1 – September 30, 2016 Tariff N/A Production Activation 10/1/16, Fall 2016 Release

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Fall 2016 – EIM PSE

Milestone Details/Date Status Application Software Changes Implementation of Puget Sound Energy as an EIM Entity. WebOMS - Provide Balancing Authorities with the ability to submit

• utages to WebOMS and the ability to submit PeakRC through their

Coordinated Outage Scheduling System (COS). BPM Changes EIM BPM will be updated based on feedback from PSE. Business Process Changes N/A Board Approval N/A External Business Requirements N/A Technical Specifications No changes expected Draft Configuration Guides No changes expected Market Simulation ISO to promote market network model including PSE area to non- production system and allow PSE to connect and exchange data in advance of Market Simulation by 3/2/16. July 5 – July 29, 2016 Parallel Operations August 1 – September 30, 2016 Tariff N/A Production Activation 10/1/16, Fall 2016 Release

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TBD – ADS UI Replacement

Milestone Details/Date Status Application Software Changes Port client from Delphi to new common user interface (ADS Query Tool and Real Time Functionality) BPM Changes N/A Business Process Changes N/A Board Approval N/A External Business Requirements N/A Updated BPMs N/A Technical Specifications N/A Draft Configuration Guides N/A Market Simulation TBD Tariff N/A Production Activation TBD

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TBD – Stepped Constraints

Milestone Details/Date Status Application Software Changes

The ISO market applies stepped penalty prices to certain constraints in the market: (1) the power balance constraint, (2) transmission constraints, and (3) energy imbalance market transfer constraints, These changes would apply different penalty prices for infeasibilities depending on the level of constraint relaxation or potentially other criteria

Board Approval Stakeholder process will be started in late 2015, Board on March 2016 Tariff TBD BPM Changes Yes Business Process Changes N/A External Business Requirements Yes Technical Specifications N/A External Training N/A Draft Configuration Guides N/A Market Simulation N/A Production Activation TBD

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Milestone Details/Date Status Application Software Changes

• 1. Replace the current system impact study approach applied in assessment of

reactive requirement for asynchronous resources with a uniform requirement for asynchronous resources.

• 2. Set up rules for reactive power financial compensation for all resources.

BPM Changes TBD Proposal Revised Straw Proposal posted October 8th, 2015 Final proposal scheduled on Nov 12th, 2015 (still under review) Project on hold pending outcome of FERC Notice of Proposed Rulemaking (NOPR) updates Board Approval TBD External Business Requirements TBD Updated BPMs TBD Technical Specifications TBD Draft Configuration Guides TBD Market Simulation Yes Tariff Yes Production Activation Fall 2017

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2017 – Reactive Power Requirements and Financial Compensation

Fall 2017 – Contingency Modeling Enhancements

Milestone Details/Date Status Application Software Changes

• IFM/RTN: Adds a preventive-corrective constraint to the market co-
• ptimization
• OASIS/CMRI: Publish preventive-corrective capacity awards with associated

LMPC

• Settlements: Payment and charges for corrective capacity awards, allocation
• f cost of the corrective capacity constraint, no-pay provisions, bid cost

recovery BPM Changes Manage Full Network Model, Market Operations, Market Instruments, Settlement and Billing, Definitions and Acronyms Study Results 3rd Revised Straw Proposal posted November 20, 2015 Stakeholder Straw Proposal review completed December 10, 2015 Board Approval June 2016 External Business Requirements TBD Technical Specifications TBD Draft Configuration Guides TBD Market Simulation TBD File Tariff TBD Production Activation Fall 2017

Page 91

Policy Update

Brad Cooper Manager, Market Design and Regulatory Policy

Page 92

Ongoing policy stakeholder initiatives

• Contingency modeling enhancements

– Conducting prototype analysis – CRR alternatives paper posted on Jan 27 – Market surveillance committee on Feb 11 – Prototype analysis posted on Feb 24 – Stakeholder meeting on prototype results March 3 – Fourth revised straw proposal posted on March 23 – Stakeholder meeting on March 30 – June 2016 Board, Fall 2017 implementation

Page 93

Ongoing policy stakeholder initiatives (continued)

• Bidding rules

– Minimum load rerate going to Feb board for Spring implementation – Draft final proposal posted on Feb 9 – Stakeholder meeting on Feb 22 – March board, Fall 2016 implementation – Likely phase 3 of initiative for some items

• Commitment Cost Enhancements – Phase 3

– Draft final proposal posted on Feb 18 – Stakeholder Call on Feb 25 – Technical appendix posted on March 2 – March Board, Fall 2016 implementation

Page 94

Ongoing policy stakeholder initiatives (continued)

• Reactive power and financial compensation

– Suspended until FERC NOPR concludes

• Frequency response

– Draft final proposal posted on Feb 2 – Stakeholder call on Feb 9 – March Board

Page 95

Ongoing policy stakeholder initiatives (continued)

• Flexible resource adequacy criteria and must-offer
• bligation – phase 2

– Revised Straw Proposal posted on Feb 11 – Stakeholder call on Feb 25 – Draft Final Proposal posted on Apr 14 – Stakeholder call on Apr 28 – June 2016 Board, Fall 2017 implementation

• Reliability services – phase 2

– Draft Final Proposal posted on Jan 26 – Stakeholder call on Feb 2 – May have another proposal iteration if needed – June 2016 Board, Fall 2017 implementation

Page 96

Ongoing policy stakeholder initiatives (continued)

• Two-tier allocation of real-time bid cost recovery uplift

– Received stakeholder comments on issue paper on Jan 15 – Reviewing comments and developing schedule

• Regional resource adequacy

– Straw Proposal posted on Feb 17 – Stakeholder meeting on Mar 2 – June 2016 Board meeting

• Regional transmission access charge structure

– Straw proposal to be posted on Feb 8 – Stakeholder meeting on Feb 26 – June 2016 Board meeting

Page 97

Policy stakeholder initiatives coming soon

• Planned to start 2016 Q1

– CRR clawback rule modifications – Stepped transmission constraints – Regional integration CA greenhouse gas compliance – Metering rules enhancements (formerly metering rule updates) – Energy storage and distributed energy resources (ESDER) phase 2

• Planned to start 2016 Q2

– Transitional implementation items

Page 98

Stakeholder initiatives going to the Board for approval

Page 99

Initiative Board Presentation Energy storage and distributed energy resources (Phase 1) February Flexible ramping product February Bidding rules February, March Commitment Cost Enhancements – Phase 3 March Frequency response March Contingency modeling enhancements June Regional resource adequacy June Regional TAC structure June Reliability services – phase 2 June FRACMOO – phase 2 June

Pricing Corrections Update

Jim McClain Lead Market Design Specialist Market Settlement Quality and Control Yu Wan Senior Market Settlement Engineering Specialist Market Settlement Quality and Control

Slide 100

Pricing Corrections Update

• Identified various areas where price corrections are

needed: – SP-Tie Pricing with GHG component – OASIS mismatches

Page 101

Pricing Corrections – Exceptions Count by Category

Page 102

353 96 400 988 1,928,618 128 43,904 2,984 500000 1000000 1500000 2000000 2500000 DA: Flowbased congestion is not fully included in SP-Tie - EIM TIE DA: Flowbased congestion is not fully included in SP-Tie - MALIN_5_N101 DA: Flowbased congestion is not fully included in SP-Tie - MONA & CRAGVIEW EIM shadow price erroneously included in SP- Tie output - ISO ties MONA & CRAGVIEW EIMT/GHG shadow prices are not properly included in SP- Tie - EIM Tie MALIN_ISL shadow price is not included in SP-Tie - Congestion or LMP Price Correction Tool Not Synched with Market Rule Price Fill Process Failure

Pricing Corrections – Exceptions Count by Month by Category

Page 103

100000 200000 300000 400000 500000 600000 700000 800000 10/1/2014 11/1/2014 12/1/2014 1/1/2015 2/1/2015 3/1/2015 4/1/2015 10/1/2014 11/1/2014 12/1/2014 1/1/2015 2/1/2015 3/1/2015 4/1/2015 Price Fill Process Failure 8 30 1689 596 285 200 176 Price Correction Tool Not Synched with Market Rule 4325 6636 1085 5819 24762 1277 MALIN_ISL shadow price is not included in SP-Tie - Congestion or LMP 33 25 23 3 2 25 17 EIMT/GHG shadow prices are not properly included in SP-Tie - EIM Tie 100628 695835 503830 444834 182540 951 EIM shadow price erroneously included in SP-Tie

• utput - ISO ties MONA & CRAGVIEW

984 1 1 2 DA: Flowbased congestion is not fully included in SP-Tie - MONA & CRAGVIEW 2 398 DA: Flowbased congestion is not fully included in SP-Tie - MALIN_5_N101 96 DA: Flowbased congestion is not fully included in SP-Tie - EIM TIE 192 161

Market Performance and Planning Forum 2016 Schedule

• March 17
• May 17
• July 21
• September 20
• November 17

Please submit questions or meeting topic suggestions through CIDI; select the “Market Performance and Planning Forum” category.

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