Electricity Markets

CAISO plan would model for possible generation outages

The California Independent System Operator’s Board of Governors on Sept. 19 approved a proposal to request Federal Energy Regulatory Commission approval for tariff changes that would incorporate potential generator outages and remedial action scheme operations into ISO market models.

A related CAISO press release states that the Board’s action would “strengthen grid resiliency and reliability,” and is “an effort to improve overall market efficiency and readiness.”

Remedial action schemes are physical-software systems integrated into the transmission system that detect predetermined system conditions and automatically take corrective actions such as automatically tripping generation if a transmission line is forced out of service. Remedial action schemes currently involve about 19,800 MW of generation within the ISO. These schemes allow new generation to connect to the system without an increase in transmission capacity, according to the ISO. With the increase in new renewable generation, remedial action is becoming more common.

The second modeling enhancement involves incorporating generator contingencies. CAISO currently models for unexpected transmission losses, but not for the unexpected loss of a generating plant. Instead, grid operators monitor the grid and take manual actions to prevent electrical flows from exceeding limits in the event of a generator contingency.

If a power plant unexpectedly trips off, devices automatically increase the output of other generators to replace the lost generation, resulting in a change in the power flows. The proposed rule changes would enable the ISO’s market models to calculate how electrical flows will change if an outage triggers such an event and ensure that electrical flows will not exceed transmission limits by reflecting the potential change in flows in locational marginal prices.

This modeling change would also account for generators tripped off when transmission is lost under a remedial action scheme. Because the ISO has only a limited ability to account for remedial action schemes, it says it tends to overly constrain the output of the generators tied to the remedial action schemes, requiring grid operators to manually dispatch those generators.

The ISO says the new rule will improve market dispatch, decrease out-of-market actions, and appropriately price each generator’s contribution to congestion in the market.

CAISO proposes to implement the modeling enhancements in both the day-ahead and the real-time markets, as well as in the model used for the congestion revenue rights market and allocation process.

Under the proposal, the ISO will select the specific generator and remedial action schemes to model as required to reliably manage its balancing area based on engineering analysis and outage studies. Energy Imbalance Market (EIM) entities could select any potential generator contingencies or remedial action schemes in their balancing area to be modeled.

The EIM element of the rule was approved by the ISO board of governors as part of the consent agenda at the September 19 meeting.

CAISO says stakeholders generally support the rule change because it will reduce out-of-market actions. On exception reported by the ISO is Southern California Edison, or SCE, which does not support the proposal because a generator connected to a remedial action scheme would receive a higher locational marginal price than another generator at the same location that is not part of the remedial action scheme.

SCE argues that the differential pricing would diminish incentives for new generators to expand transmission capacity, skewing the ISO’s interconnection queue.

CAISO responded to SCE by stating that locational marginal prices would be correct because they would reflect generators’ contributions to congestion and lead to the most efficient dispatch. Moreover, the ISO points out that the interconnection process will not be affected and will continue to be based on reliability studies, not on potential market prices.