Technical Advisory Committee Presentation to the ERCOT Board of Directors May 20, 2009

Technical Technical Advisory Advisory

CommitteeCommitteePresentation to the Presentation to the

ERCOT Board of DirectorsERCOT Board of DirectorsMay 20, 2009May 20, 2009

TAC Report SummaryTAC Report Summary• 2 PRRs for Board approval2 PRRs for Board approval• 4 NPRRs for Board approval4 NPRRs for Board approval• 1 SCR for Board approval1 SCR for Board approval• Recommendation: NPRR Parking DeckRecommendation: NPRR Parking Deck• Update: ERCOT planning charterUpdate: ERCOT planning charter• Preview: June Board meetingPreview: June Board meeting

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Protocol Revision RequestsProtocol Revision RequestsPRR 797PRR 797 Removal of Reference to ERCOT Removal of Reference to ERCOT

Business ProcessesBusiness ProcessesPRR 800PRR 800 QSE Day Ahead Metric – URGENT QSE Day Ahead Metric – URGENT

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PRR 797PRR 797 – Removal of Reference to ERCOT – Removal of Reference to ERCOT Business ProcessBusiness Process

PurposePurpose(ERCOT)(ERCOT)

Revises term “Generation Resource Asset Revises term “Generation Resource Asset Registration Form” in Section 4.10.4.1 (LSL Registration Form” in Section 4.10.4.1 (LSL Requirements for WGRs) to “as registered with Requirements for WGRs) to “as registered with ERCOT”ERCOT”

BenefitBenefit Clarifies that the requirement is asset Clarifies that the requirement is asset registration and not a specific type of formregistration and not a specific type of form

Market ImpactMarket Impact N/AN/A

System ChangeSystem Change NoNo N/AN/A

AssumptionsAssumptions N/AN/ATAC VoteTAC Vote TAC unanimously recommended approval; all TAC unanimously recommended approval; all

Market Segments were presentMarket Segments were present

Effective DateEffective Date June 1, 2009June 1, 2009

PRR 797PRR 797 – Removal of Reference to – Removal of Reference to ERCOT Business ProcessERCOT Business Process

Item ReviewedItem Reviewed DescriptionDescriptionNoNoImpactImpact

Credit Credit Monitoring/Monitoring/LiabilityLiability

BudgetBudget

StaffingStaffing

Computer SystemsComputer Systems

Business FunctionsBusiness Functions

Grid OperationsGrid Operations

ImpactImpact

PRR 800PRR 800 – QSE Day-Ahead Metric -- – QSE Day-Ahead Metric -- URGENTURGENT


Re-defines the Day Ahead metric for QSEs with Re-defines the Day Ahead metric for QSEs with and without WGRs to ensure that both categories and without WGRs to ensure that both categories of QSE schedule enough capacity in the Day of QSE schedule enough capacity in the Day Ahead to meet their planned energy schedules Ahead to meet their planned energy schedules plus A/S obligations; removes WGR QSE plus A/S obligations; removes WGR QSE exemption established by PRR 777, WGR QSE exemption established by PRR 777, WGR QSE Metric CorrectionMetric Correction

BenefitBenefit Establishes an appropriate Day Ahead metric for Establishes an appropriate Day Ahead metric for all QSEsall QSEs

Market ImpactMarket Impact N/AN/ASystem ChangeSystem Change NoNo ERCOT source systems will not be ERCOT source systems will not be

modified or impacted by this PRR.modified or impacted by this PRR.AssumptionsAssumptions ERCOT will develop a reporting solution which ERCOT will develop a reporting solution which

will query and report data from source systems. will query and report data from source systems. TAC VoteTAC Vote TAC unanimously recommended approval; all TAC unanimously recommended approval; all

Market Segments were presentMarket Segments were presentEffective DateEffective Date Upon system implementationUpon system implementation




BudgetBudget

StaffingStaffing




ImpactImpact

Less than $50K (project required)


• TAC discussion regarding funding TAC discussion regarding funding mechanisms for TRE system projectsmechanisms for TRE system projects• TRE / ERCOT Service Level TRE / ERCOT Service Level

AgreementAgreement• TRE Fee vs. ERCOT Administrative TRE Fee vs. ERCOT Administrative

FeeFee• NOGRR 025 budget assumptionsNOGRR 025 budget assumptions

Nodal Protocol Revision Nodal Protocol Revision RequestsRequests

NPRR 157NPRR 157 Extending Black Start Service Bid Extending Black Start Service Bid TimelineTimeline

NPRR 163NPRR 163 Removal of Late Fee Language Removal of Late Fee LanguageNPRR 166NPRR 166 Timing for Required Black Start Timing for Required Black Start

Unit Load Carrying TestUnit Load Carrying TestNPRR 167NPRR 167 Options for Filing Verifiable Costs Options for Filing Verifiable Costs

– QSEs or Resources– QSEs or Resources

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NPRR 157NPRR 157– Extending Black Start Service – Extending Black Start Service Bid TimelineBid Timeline

PurposePurpose(ROS)(ROS)

Changes the Black Start Service bids from a 1-Changes the Black Start Service bids from a 1-year period to a 2-year period (companion was year period to a 2-year period (companion was PRR780)PRR780)

BenefitBenefit Gives Transmission Operators and Market Gives Transmission Operators and Market Participants more time to prepare and train their Participants more time to prepare and train their system operatorssystem operators

Market ImpactMarket Impact Allows more time to train system operatorsAllows more time to train system operatorsSystem ChangeSystem Change NoNo N/AN/AAssumptionsAssumptions N/AN/ATAC VoteTAC Vote TAC unanimously recommended approval; all TAC unanimously recommended approval; all

Market Segments were presentMarket Segments were presentEffective DateEffective Date ERCOT believes NPRR 157 is needed for “go-ERCOT believes NPRR 157 is needed for “go-

live”; effective upon Nodal implementation; no live”; effective upon Nodal implementation; no impact to scheduleimpact to schedule

NPRR 157NPRR 157– Extending Black Start Service – Extending Black Start Service Bid TimelineBid Timeline



BudgetBudget

StaffingStaffing




ImpactImpact

NPRR 163NPRR 163– Removal of Late Fee Language– Removal of Late Fee Language


Eliminates conflicting language by removing the Eliminates conflicting language by removing the concept of late fees calculated on all delinquent concept of late fees calculated on all delinquent accounts; states that late fees are only calculated accounts; states that late fees are only calculated on delinquent DAM, RTM and RTM uplift on delinquent DAM, RTM and RTM uplift amountsamounts

BenefitBenefit Removes conflicting languageRemoves conflicting languageMarket ImpactMarket Impact N/AN/ASystem ChangeSystem Change NoNo N/AN/AAssumptionsAssumptions N/AN/ATAC VoteTAC Vote TAC unanimously recommended approval; all TAC unanimously recommended approval; all

Market Segments were presentMarket Segments were presentEffective DateEffective Date ERCOT believes NPRR 163 is needed for “go-ERCOT believes NPRR 163 is needed for “go-

live”; effective upon Nodal implementation; no live”; effective upon Nodal implementation; no impact to scheduleimpact to schedule

NPRR 163NPRR 163– Removal of Late Fee – Removal of Late Fee LanguageLanguage



BudgetBudget

StaffingStaffing




ImpactImpact

NPRR 166NPRR 166– Timing for Required Black – Timing for Required Black Start Unit Load Carrying TestStart Unit Load Carrying Test


Synchronizes the Nodal Protocols for PRR 785, Synchronizes the Nodal Protocols for PRR 785, Timing for Required Black Start Unit Load Timing for Required Black Start Unit Load Carrying Test (BOD Approved 3/09); changes test Carrying Test (BOD Approved 3/09); changes test from once every six years to once every five yearsfrom once every six years to once every five years

BenefitBenefit Reduces risk of NERC compliance violationReduces risk of NERC compliance violation

Market ImpactMarket Impact More frequent load carrying testsMore frequent load carrying tests




Effective DateEffective Date ERCOT believes NPRR 166 is needed for “go-ERCOT believes NPRR 166 is needed for “go-live”; effective upon Nodal implementation; no live”; effective upon Nodal implementation; no impact to scheduleimpact to schedule

NPRR 166NPRR 166– Timing for Required Black – Timing for Required Black Start Unit Load Carrying TestStart Unit Load Carrying Test



BudgetBudget

StaffingStaffing




ImpactImpact

NPRR 167NPRR 167– Options for Filing Verifiable – Options for Filing Verifiable Costs – Costs –

QSEs or ResourcesQSEs or ResourcesPurposePurpose(Verifiable Cost (Verifiable Cost WG)WG)

Allows either QSEs or Resource Entities to file Allows either QSEs or Resource Entities to file verifiable costsverifiable costs

BenefitBenefit Eliminates confidentiality issues associated with Eliminates confidentiality issues associated with Resource-specific verifiable cost dataResource-specific verifiable cost data

Market ImpactMarket Impact N/AN/A




Effective DateEffective Date ERCOT has no opinion on whether NPRR 167 is ERCOT has no opinion on whether NPRR 167 is needed for “go-live”; no Nodal impactsneeded for “go-live”; no Nodal impacts

NPRR 167NPRR 167– Options for Filing Verifiable – Options for Filing Verifiable Costs – Costs –

QSEs or ResourcesQSEs or Resources



BudgetBudget

StaffingStaffing




ImpactImpact

System Change RequestSystem Change RequestSCR 753SCR 753 Transmission Outage Notice Detail Transmission Outage Notice Detail

EnhancementsEnhancements Enhances transparency of grid operations by Enhances transparency of grid operations by

publishing additional information regarding publishing additional information regarding outages.outages. This information is already available in ERCOT systems, This information is already available in ERCOT systems,

just needs to be extracted and publishedjust needs to be extracted and published Will make outages easier to track for all market Will make outages easier to track for all market

participantsparticipants Minor cost impact to be absorbed by affected Minor cost impact to be absorbed by affected

departments O&M budgetsdepartments O&M budgets Requires approximately one month to complete after Requires approximately one month to complete after

Board approvalBoard approval Unanimously recommended by TACUnanimously recommended by TAC

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Recommendation: NPRR Recommendation: NPRR Parking DeckParking Deck

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• Post-“Go-Live” NPRRsPost-“Go-Live” NPRRs• Parking Deck white paper and supporting Parking Deck white paper and supporting

materials included in Board packetmaterials included in Board packet• After PRS approves NPRR, they will suggest a After PRS approves NPRR, they will suggest a

rank on the Nodal tab of the Project rank on the Nodal tab of the Project Prioritization List (PPL) – Parking DeckPrioritization List (PPL) – Parking Deck

• Only Approved Items will be on Parking DeckOnly Approved Items will be on Parking Deck• PRS sends approved NPRRs to TAC with rankPRS sends approved NPRRs to TAC with rank• TAC sends approved NPRRs to BoardTAC sends approved NPRRs to Board• If Board approves NPRR, language added to If Board approves NPRR, language added to

Nodal Protocols as a grey-boxNodal Protocols as a grey-box• Approved rank will be tracked in PPL and Approved rank will be tracked in PPL and

projects in the PPL will be grouped into post-Go-projects in the PPL will be grouped into post-Go-Live releasesLive releases

• Before NPRRs on the PPL can be implemented, Before NPRRs on the PPL can be implemented, ERCOT will provide impact analyses, cost-benefit ERCOT will provide impact analyses, cost-benefit analyses, and the post-Go-Live releases will be analyses, and the post-Go-Live releases will be included in the annual Admin Fee budgeting included in the annual Admin Fee budgeting processprocess

Update: ERCOT Planning Update: ERCOT Planning CharterCharter

In January, ERCOT Staff presented recommended In January, ERCOT Staff presented recommended changes to the ERCOT Planning Charter. TAC changes to the ERCOT Planning Charter. TAC endorsed the proposed changes.endorsed the proposed changes.

The Board approved the revisions except the The Board approved the revisions except the proposal to exempt transmission projects relating to proposal to exempt transmission projects relating to generation interconnection from ERCOT and RPG generation interconnection from ERCOT and RPG review. Treatment of such facilities was remanded review. Treatment of such facilities was remanded to TAC for further discussion and recommendation.to TAC for further discussion and recommendation.

The current Planning Charter language requires The current Planning Charter language requires generation interconnection projects costing more generation interconnection projects costing more than $15 million or requiring CCNs be reviewed by than $15 million or requiring CCNs be reviewed by the RPG (including ERCOT independent review and the RPG (including ERCOT independent review and Board approval as appropriate).Board approval as appropriate).

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Current Review ProcessCurrent Review Process

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ProposedProject

Is it a “Neutral Project”?

>$50M Capital Cost

n y

n

CCN Required?

y

<$15M Capital Cost?

n

n

y

y

•RPG Review and Comment•ERCOT Independent Review•ERCOT BOD Endorsement

TIER 1

•RPG Review and Comment•ERCOT Independent Review•ERCOT BOD Endorsement

TIER 1

•RPG Review and Comment•ERCOT Independent Review

TIER 2

•RPG Review and Comment•ERCOT Independent Review

TIER 2

•RPG Review and Comment

TIER 3

•RPG Review and Comment

TIER 3

•No ERCOT Review

TIER 4

•No ERCOT Review

TIER 4

Summary of stakeholder Summary of stakeholder discussiondiscussion

Consensus on 2 procedural changes for TSPs to Consensus on 2 procedural changes for TSPs to raise visibility of large generation interconnection raise visibility of large generation interconnection projectsprojects

Require in Generation Interconnection (GI) Require in Generation Interconnection (GI) Procedure that the Lead TSP for the Full Procedure that the Lead TSP for the Full Interconnection Study (FIS) communicates to other Interconnection Study (FIS) communicates to other TSPs when the FIS indicates that the direct TSPs when the FIS indicates that the direct interconnection facilities will cost >$50 million so interconnection facilities will cost >$50 million so that the other TSPs will know to particularly focus that the other TSPs will know to particularly focus on the FIS on the FIS

The Lead TSP for GI FIS will communicate direct The Lead TSP for GI FIS will communicate direct generation interconnection projects >$50 million out generation interconnection projects >$50 million out to full RPG (no review by RPG) once generation to full RPG (no review by RPG) once generation Interconnection Agreement is signedInterconnection Agreement is signed

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Summary of stakeholder Summary of stakeholder discussiondiscussion

Support for ERCOT/RPG Review of interconnection facilitiesSupport for ERCOT/RPG Review of interconnection facilities Commission Staff testimony in Kelson CCN docket expressed need Commission Staff testimony in Kelson CCN docket expressed need

for ERCOT review of these types of CCNsfor ERCOT review of these types of CCNs Increase transparency / awareness of significant projectsIncrease transparency / awareness of significant projects

Concerns with ERCOT/RPG Review of interconnection Concerns with ERCOT/RPG Review of interconnection facilitiesfacilities Reliability impacts are already considered in generation Reliability impacts are already considered in generation

interconnection study processinterconnection study process ERCOT and RPG review of these projects results in stakeholder ERCOT and RPG review of these projects results in stakeholder

judgment on the economic merits of the proposed generationjudgment on the economic merits of the proposed generation Potential for RPG review to delay generation interconnectionPotential for RPG review to delay generation interconnection

Additional considerationsAdditional considerations Open access regime should be preserved in whatever process is Open access regime should be preserved in whatever process is

adoptedadopted Appropriateness of ERCOT role / recognition of ERCOT work loadAppropriateness of ERCOT role / recognition of ERCOT work load

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Planning Charter options Planning Charter options consideredconsidered

Regional Planning Group: no consensusRegional Planning Group: no consensus Reliability and Operations Subcommittee: Reliability and Operations Subcommittee:

recommended Planning Charter language recommended Planning Charter language proposed to the Board in January with the 2 proposed to the Board in January with the 2 procedural changesprocedural changes

Wholesale Market Subcommittee: Agreed with 2 Wholesale Market Subcommittee: Agreed with 2 procedural changes and agreed to revert to procedural changes and agreed to revert to January Planning Charter proposal but evenly January Planning Charter proposal but evenly split whether to add language requiring ERCOT split whether to add language requiring ERCOT and/or RPG review for informational purposes and/or RPG review for informational purposes when proposed direct interconnection facilities when proposed direct interconnection facilities >$25 million or >$50 million>$25 million or >$50 million

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Status of TAC deliberationsStatus of TAC deliberations In addition to other identified issues, TAC discussed In addition to other identified issues, TAC discussed

whether this is a policy determination best made by the whether this is a policy determination best made by the PUCT rather than stakeholders and whether TAC and the PUCT rather than stakeholders and whether TAC and the Board might receive policy guidance from the PUCT soon Board might receive policy guidance from the PUCT soon through a final order in the Kelson CCN docketthrough a final order in the Kelson CCN docket

Motion to recommend the January Planning Charter Motion to recommend the January Planning Charter proposal with a requirement ERCOT perform economic proposal with a requirement ERCOT perform economic analysis for facilities >$50 million failed: 17 Yes, 11 No, analysis for facilities >$50 million failed: 17 Yes, 11 No, 2 Abstain2 Abstain

Motion to recommend the January Planning Charter Motion to recommend the January Planning Charter proposal with requirement ERCOT perform economic proposal with requirement ERCOT perform economic analysis for facilities >$25 million when requested by analysis for facilities >$25 million when requested by PUCT Staff failed: 5 Yes, 21 No, 3 AbstainPUCT Staff failed: 5 Yes, 21 No, 3 Abstain

Motion to Table passed on voice vote with 3 abstentionsMotion to Table passed on voice vote with 3 abstentions

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Preview: June Board Preview: June Board meetingmeeting

PRR 796 Resource Plan Performance Metrics PRR 796 Resource Plan Performance Metrics RevisionRevision

PRR 802 TCR Transition to CRR Refund RevisionPRR 802 TCR Transition to CRR Refund Revision Quarterly CREZ Report to PUCTQuarterly CREZ Report to PUCT Draft Texas Renewables Integration PlanDraft Texas Renewables Integration Plan Restructured TAC engagement in nodal projectRestructured TAC engagement in nodal project

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Documents

Technical Advisory Committee Presentation to the ERCOT Board of Directors May 20, 2009