RSS Feed for Proposed Revision Request - 1393

PRR - 1393

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Initial Comment for PRR - 1393

Description: o In Section L2, CAISO states “Each of the three proxy costs has a corresponding VOM adder: the variable minimum load O&M (VOM-ML) adder corresponds to MLC, the variable start-up O&M (VOM-SU) adder corresponds to SUC, and the variable energy O&M (VOM-EN) adder corresponds to the DEB.” SRP suggests clarifying that the VOM-EN also applies to the Minimum Load costs, as shown in Figure L-1. o In Section L.4.1, CAISO describes the process for implementing the VOM adder values (#3). SRP requests that CAISO also add that the effective date for such change should be mutually-agreed upon by both CAISO and the Scheduling Coordinator (SC) to be updated in the Master File. o In Section L.4.2, the “Or Criteria” is described for units with limitations on both starts and operating hours, with a chance that the unit may reach either. SRP requests that the CAISO allow for participants to register any blend of starts or hours deemed appropriate by the SC, especially in the case that unit run profiles need to be altered in order to preserve remaining life prior to a maintenance activity. The old language in Attachment L acknowledges that an ongoing update to this blend may be needed to influence desired run profiles, and not simply based on which is more likely to be reached first. The new language does not give SCs as much flexibility to determine the desired operation of the unit, even if it is likely that a unit may reach either starts or hours first. Without sufficient flexibility to manage run profiles of units, participants may elect to withhold bids or limit participation of certain units to ensure there are enough run hours or starts remaining before reaching a scheduled maintenance activity. This is flexibility is required to ensure capacity needs and ramping needs are met at all times.
-By Marcie Martin (SRP) on Friday, November 12, 2021 6:03:51 AM

Response: Thank you for the feedback. CAISO will edit the draft based on your comments.
-By Batakji, Jamal on Monday, November 15, 2021 3:09:57 PM

Recommendation Comment for PRR - 1393

Description: SRP appreciates CAISO’s incorporation of the initial comments to PRR1393 and the opportunity to comment again on Attachment L. In reviewing Attachment L in further depth, SRP has a concern with the 1/1/2022 implementation approach as described in Table L-6. This table summarizes the approach the CAISO will take to switch registered or default Operations and Maintenance (O&M) costs to the new methodology if new values are not fully negotiated by this time. As described, the current defaults or previously negotiated values that Scheduling Coordinators (SCs) have been claiming for the Variable O&M (VOM) cost adders will transition to 3 parts: (1) VOM-EN Adder, (2) VOM-ML Adder, and the (3) VOM-SU Adder. • Part (1) VOM-EN adder will be a full-transition from the old value to the newly proposed values if the Scheduling Coordinator (SC) claimed the incumbent default VOM for a resource. If the SC had a negotiated VOM for a resource, this negotiated value will remain. • Parts (2) and (3) are another matter: o For the assets that have claimed negotiated MMAs, SCs have a choice of grandfathering the incumbent Minimum Load Cost (MLC) Major Maintenance Adder (MMA) and Startup Cost (SUC) MMA into the new regime as the new (2) VOM-ML Adder and (3) VOM-SU Adder respectively. In that scenario, those assets will only be compensated for the (1) EN-Adder of the new default values and will not realize additional recovery for parts (2) or (3) cited above. o Alternatively, the SC may elect to forego the registered MMA and adopt the new VOM-ML adder and VOM-SU adder in lieu of the MMAs. o SRP strongly prefers that the new approach should be additive between the incumbent MMA values and the new VOM adder values. SRP is concerned that the new approach may greatly reduce the Default Energy Bid (DEB) below actual operating costs for the units with a registered MMA that are still using the default VOM adders. The new VOM-EN adders for most units are substantially lower than the prior default VOM adders, which indicates that there are significant costs outside of the Major Maintenance items that were counted prior to 1/1/22 that are no longer able to be counted and recovered. If the SC instead decides to use the new VOM-ML and VOM-SU adders and forego the registered MMAs, then the SC instead loses the ability to recoup costs on any Major Maintenance items. This is reinforced by the fact that resources with no registered MMA can also default to the very same VOM-ML and VOM-SU adders. SRP appreciates CAISO’s concern that costs can be double counted if MMAs are able to be counted above and beyond the VOM-ML and VOM-SU, but SRP believes that the MMAs reflect costs from major capital equipment that do not seem to be fully or partially captured by the VOM-ML and VOM-SU adders. In the interim while entities may be completing negotiations with the CAISO, SRP requests the option to make previously registered MMAs additive to VOM-ML and VOM-SU adders starting 1/1/22. If the CAISO is willing to make them additive, SRP requests that the language in the current Attachment L be modified to clearly reflect that scenario. If the CAISO does not enable SCs to incorporate all operating costs into the DEB, SCs may elect to withdraw bids to ensure cost recovery.
-By Jerret Fischer (SRP) on Tuesday, December 14, 2021 12:27:52 PM

Response: The CAISO appreciates SRP’s input on the proposed BPM edits. SRP requests that the CAISO allow SCs to add the new default VOM-SU or VOM-ML values to existing MMA values while SCs complete their negotiations. Unfortunately, it does not appear that the CAISO tariff (effective 1/1/2022) allows for SRP’s proposed approach. Section 30.4.5.4.1 states: “The Scheduling Coordinator for any resource may choose to negotiate with the CAISO pursuant to Section 30.4.5.4.3 for negotiated Variable Operations and Maintenance Adders that supersede or replace any default Variable Operations and Maintenance Adders the resource may receive … Pursuant to Section 30.4.5.4.6, the CAISO will convert negotiated operations and maintenance values that were established for a resource prior to January 1, 2022 into corresponding negotiated Variable Operations and Maintenance Adders.” This change is also inappropriate for several other reasons. First, as SRP accurately mentions, there is a potential for double-counting of costs between the negotiated and default adder types if their request were granted. Second, to address stakeholder concerns raised in the Policy and Tariff processes, the CAISO created a detailed transition process to give stakeholders adequate time – over 6 months – to renegotiate any of the adders they felt were inadequate. This transition process also included targeted outreach encouraging them to review their current adder values and the new default adder values. Finally, all of the negotiations that have occurred since May 2021 have been assumed that the transition to the new framework will be followed according to the plan outlined in the BPM. If the CAISO were to change the plan at this late point, this would unfairly disadvantage the SCs that made a good faith effort to complete their negotiations on a timely basis.
-By Batakji, Jamal on Wednesday, December 22, 2021 9:55:36 AM

Recommendation for PRR - 1393

Proposed Language:

modifications to the original PRR are proposed based on comments

Apparent Requirement: Variable operations and maintenance cost changes
Priority: N/A
Action: Approve the BPM PRR as modified.
Effective Date: 01/01/2022
Other Actions: No other recommended actions on this PRR

Final Decision for PRR - 1393

Final Decision: Adopt the recommendation
Stakeholder Comment: Comments submitted and CAISO posted the responses on 12/22/21
Action: Adopt the recommendation as modified
Effective Date: 01/03/2022