Ramp Capability Product Performance Update Market Roadmap ID: 48 Issue ID: MR048. Market Subcommittee November 29, 2016

Transcription

1 Ramp Capability Product Performance Update Market Roadmap ID: 48 Issue ID: MR048 Market Subcommittee November 29, 2016

2 Purpose Purpose and Key Takeaways Review Ramp Capability Product (RCP) Performance since Go-Live date of May 1, 2016 Key Takeaways Ramp product is delivering benefits to the MISO grid Ramp product is performing as designed MISO continues to monitor key design parameters and overall product performance 2

3 Ramp Capability Product (RCP) Outline RCP Overview Summary of Benefits Production Results Pricing and Payments Cleared MW DA-to-RT Convergence Deliverability of cleared ramp product Next Steps Appendix with Further Analyses 3

4 Requirements set to manage net load variations & uncertainty 10min ahead 1 Co-optimization with energy and AS from Day-Ahead to Real-Time 3 All dispatchable resources are qualified; participation is voluntary 2 Market clearing prices Marginal costs to meet ramp requirements Opportunity cost forgone profit a resource could have earned by providing energy or AS Ramp Capability demand curve strike the balance between how much premium to pay now versus potential saving in the future Economic incentives for resources to provide ramp flexibility and better dispatch following 4 DRR: Demand Response Resource; SER: Stored Energy Resource; EAR: External Asynchronous Resource; DIR: Dispatchable Intermittent Resource 4

5 RCP Shows Benefits (Simulation-based)* Metric Without RCP With RCP Benefit Average RT LMP $30.05 $29.81 RT LMP Standard Deviation Avg ABS(DALMP-RTLMP) $7.40 $7.16 RT Production Cost % reduction in RT prices (equates to ~$200 million annualreduction in load payments) 7% reduction in RT price volatility 3%improvement in DA-RT price convergence Annual cost savingsof $4.2 Million** * Utilizes simulation results from the IMM Summer 2016 Quarterly Report (July RT market with and without RCP). MISO BOD Markets Committee, 9/13/ **Includes two components. 1) Reduction in resource production costs ($0.4 million) and 2) Reduction in reserve shortage costs ($3.8 million). Simulations showed a 16.8% reduction in reserve shortage costs, which was scaled based on the annual shortage cost over the past five years. Result does not include DA/RAC recommitment savings. 5

6 RCP has Benefits During Reserve Scarcity 12 RT intervals in July were scarce in one or more reserve products About half of the total monthly reduction in average LMPs and volatility occurred in these intervals Scarcity Interval AvgMISO Hub LMP with RCP* AvgMISO Hub LMP without RCP* LMP Reduction % Reduction 7/5/ :30 $1, $1, $ % 7/5/ :35 $ $ $0.00 0% 7/5/ :40 $ $ $0.00 0% 7/5/ :00 $ $ $0.02 0% 7/16/ :55 $27.18 $27.18 $0.00 0% 7/25/ :30 $ $ $ % 7/25/ :35 $ $ $ % 7/25/ :40 $ $ $ % 7/25/ :45 $ $ $ % 7/25/ :50 $ $ $ % 7/25/ :55 $ $ $ % 7/28/ :25 $1, $1, $5.98 0% * IMM RT Market Simulation of July

7 RCP can help reduce LMP spikes Many price spikes are avoided/reduced when using the ramp product. Small LMP increases are sometimes seen due to ramp procurement.* * IMM RT Market Simulation of July

8 RCP Production Results are as Expected Ramp Capability Product (RCP) went live on 5/1/2016 All results in this presentation are from 5/1 9/30/2016 Ramp Down MCP = 0 for all DA and RT cases Pricing and payments are modest Average DA price = $.55/MWh, RT price = $.13/MWh Total RCP Up Payments were ~$1.31 Million in DA and ~$35 thousand in RT (net) DA/RT Price convergence is reasonable Absolute value of difference is small, and is consistent with higher DA energy prices and MISO RAC processes Nearly all eligible resources (95-97%) participated 8

9 Monthly Average RCP Up Marginal Clearing Prices (MCPs) Absolute difference between DA and RT ramp prices is consistent with difference between DA and RT energy prices. Monthly ramp prices follow average energy price trends (DA LMPs and DA Ramp MCPs have a 0.69 correlation) Average DA MCP = $.55/MWh, RT MCP = $.13/MWh Date range: 5/1/16 9/30/16 9

10 Hourly RCP Up Available, Cleared and MCPs Ramp up prices (MCPs) increase during hours when the available ramp drops near the ramp requirements. RT has more available ramp MW than DA for many hours of the day. Date range: 5/1/16 9/30/16 10

11 Additional RT Capacity for RCP Up Previous chart shows that additional capacity is available RCP Up in Real-Time, especially in hours This is the primary driver of lower Real-Time (RT) prices Extra capacity can appear in RT for several reasons: DA market may have cleared more generation than needed in RT RAC may commit excess capacity if there are significant forecasting errors (load, wind, NSI) In addition, MISO RAC commits extra capacity to make up for stranded MW, which results from: Low ramp-rate units (less than 0.5MW/min), and Generating capacity trapped behind binding constraints 11

12 RAC-Commitments due to Stranded MW provide more capacity for RT RCP Up Estimate this additional RT RCP Up Available Capacity Gather Stranded MW and Online Headroom data Ignore Stranded MW in intervals when Online Headroom is high (>2,000MW) No additional commitments are needed Convert this additional RAC-committed capacity by 35%** to compute an effective 10-minute ramp capacity For example, if a 100MW unit is committed by RAC, then we estimate that an additional 35MW will be available to RCP Up ** The 35% factor is based on actual MISO-committed peaker units from a one-week period. This factor means that 35% of the additional committed capacity can be accessed within a 10-minute period. 12

13 Extra RT RCP Up Capacity is Available due to Stranded MW Commitments In hours 10-20, stranded MWs will result in additional RAC commitments, which in turn will provide more RCP Up available capacity. Date range: 5/1/16 9/30/16 13

14 Stranded MW Impact on RT RCP Available Capacity The additional RCP Up capacity from the previous chart appears as the difference between the orange and purple lines. Date range: 5/1/16 9/30/16 14

15 DA/RT RCP MCP Convergence Statistics In most hours (83%), the RT and DA MCPs are either both zero or non-zero. We saw that DA and RT prices can differ due to additional RT capacity. % of Hours RT MCP = 0 MCP> 0 DA MCP = 0 75% 5% MCP> 0 12% 8% Mean-Absolute-Error between DA and RT MCPs: $0.51 Correlation between DA and RT MCPs: 0.35 Date range: 5/1/16 9/30/16 15

16 Most RCP Up Awards are Deliverable Deliverability is an issue for all reserve types, not just the ramp product Post-deployment constraints are computationally expensive The congestion component of the energy price (MCC) can indicate deliverability A negative MCC, however, does not necessarily mean that the ramp is undeliverable in 10 minutes The shows that 7% of RT Cleared Ramp Up is on resources with an MCC < -$20 Date range: 5/1/16 9/30/16 16

17 Next Steps Continue to monitor DA/RT convergence and deliverability of RCP Ensure that RCP requirements are appropriate (too much raises costs; too little could increase market volatility) Evaluate Need for DA Headroom Constraint 17

18 MISO is Evaluating DA Headroom Constraint This 30-min constraint existed in DA before RCP Enforced only in RSC (unit commitment) phase It is not explicitly priced It may be redundant with RCP in many hours MISO will examine the DA Headroom and RCP constraints over an extended period of time Track requirements, shadow prices and violations* When the headroom constraint binds, does it create a measurably better solution, compared to using only RCP constraints? * Will require changes to DA engine to save this information for later review 18

19 Contact Information Chuck Hansen Congcong Wang Dhiman Chatterjee 19

20 Appendix Additional tables/charts related to the Ramp Capability Product 20

21 Ramp Capability Product manages increasing system ramping needs driven by recent market evolutions Load Following Challenges Increasing renewables and interchange flexibility require more ramping Net Load = Load Non-controllable generation + NSI Variations: Expected changes in load, wind and NSI Uncertainty: Unexpected changes of load and wind forecast errors, generators deviating from set-point Incentive for resource flexibility Transparent price signals encourage ramping flexibility Ramp Management Objectives Systematic approach to pre-position resources to manage net load changes Market-based approach for ramp management with transparent price signals to incent resource flexibility 21

22 Average Hourly RCP Requirements DA and RT requirements for up and down ramp are consistent. Date range: 5/1/16 9/30/16 22

23 DA/RT RCP Up Available MW in Hours Date range: 5/1/16 9/30/16 23

24 Distribution of RT and DA MCPs for Up Ramp DA % of Hours RT MCP = 0 0<MCP<5 MCP = 5 Any MCP MCP = % 5.0% 0.0% 80.4% 0<MCP<5 8.3% 5.4% 0.1% 13.8% MCP = 5 3.5% 2.2% 0.1% 5.8% Any MCP 87.3% 12.6% 0.1% 100.0% MCP is zero in both RT and DA in 75.4% of hours MCP is non-zero in both RT and DA in 5.4% + 2.2% + 0.1% + 0.1% = 7.8% of hours MCP is zero in RT or DA, but not the other, in 8.3% + 3.5% + 5.0% + 0% = 16.8% of hours The DA MCP is non-zero in 13.8% + 5.8% = 19.6% of hours, while RT MCP is non-zero in only 12.7% of hours Date range: 5/1/16 9/30/16 24

25 MCP Breakdown for RCP Up Direction Avg MCP MCP = 0 0<MCP<5 DA MCP = 5 Any MCP RT MCP = 0 0<MCP<5 MCP = 5 Any MCP RT MCP = $0 RT MCP = $0.67 RT MCP = $0.04 n/a DA MCP = $0 DA MCP = $0 DA MCP = $0 RT MCP = $0 DA MCP = $1.74 RT MCP = $0 DA MCP = $5 RT MCP = $0, DA MCP $0.37 RT MCP = $1.03 DA MCP = $2.03 RT MCP = $1.49 DA MCP = $5 RT MCP = $0.97 DA MCP = $1.75 RT MCP = $5 DA MCP = $3.86 RT MCP = $5 DA MCP = $5 RT MCP = $5 DA MCP = $4.43 RT MCP = $0.42 DA MCP = $1.86 RT MCP = $0.62 DA MCP = $5 RT MCP = $0.13 DA MCP = $0.55 This table shows the average prices, which correspond to the table on the previous slide Date range: 5/1/16 9/30/16 25

26 RCP Up Revenues (Avg Hourly) Most payments for the ramp product occur in the DA market between HE8 and HE17. Date range: 5/1/16 9/30/16 26

27 Cleared Ramp Up in SOUTH Region This chart shows that a significant % of ramp is cleared in the South Region (49% of DA and 46% of RT). However, the S-N Flow Limit is not binding in 98% of RT intervals (see next slide). Date range: 5/1/16 9/30/16 27

28 Actual S-N Flow (SRPBC) During this 5-month period, the S-to-N Limit was binding in 2% of real-time intervals. 28

29 Cleared RCP Up by Fuel Type (DA and RT) Coal and Gas Units clear a combined 92-94% of the ramp 29

30 DA Cleared RCP Up (Fuel vs. Congestion) This shows that ramp awards for wind units primarily happen when there is congestion. Date range: 5/1/16 9/30/16 30

31 RT Cleared RCP Up (Fuel vs. Congestion) This shows that ramp awards for wind units primarily happen when there is congestion. Date range: 5/1/16 9/30/16 31

32 Other Ramp Product Results The width of the RCP cone reflects historical uncertainty in net load forecast, and units not following dispatch 99.5% of net load values, using UDS cases 10- minutes in the future, were inside the cone This was the design target UDS offsets were ignored in this analysis How many MW are cleared in $0, and had to be bought back in RT? Answer: Approximately 1.7% of DA payments ($22K) 32

33 Sample Headroom vs. RCP Constraints Data from November 7, 2016 DA Case Headroom constraint is divided by 3 (30 min vs. 10 min window) The RCP (ramp) requirement is higher in most hours, especially during the peak load hours On this day, it appears that the Ramp Up requirement is significantly higher than the headroom requirement. DA results would show if the headroom constraint is binding in any hours. 33