Transcript Jameson Smith

Demand Response in
MISO Markets
NASUCA Panel on DR
November 12, 2012
About MISO
• MISO is an independent, non-profit organization and
is committed to the safe, cost-effective delivery of
electric power
• MISO’s Three Primary Roles:
– Reliability - keeping the lights on throughout the Midwest
– Wholesale Market Management - allowing the sale and transfer
of wholesale electricity to reduce costs and promote reliability
– Regional Transmission Planning - working with all transmission
stakeholders to develop the region’s transmission grid in a way
that promotes public interest; reliability, and enables lowest-cost
delivery of electricity and implementation of public policies
2
Market Based Demand Response
•
MISO operates an open wholesale energy market
where Market Participants can buy or sell energy in
a fair, efficient and non-discriminatory manner
•
Markets work best when there is vigorous and
voluntary participation by both buyers (demand
response) and sellers
•
Demand response can:
– reduce the need for new generating capacity
– address real-time reliability issues
– mitigate peak prices and price volatility
– limit supplier market power
3
Demand Response Participation
• MISO’s markets provide opportunities for demand to
participate on a comparable basis to supply side
resources (generation)
– Provides price signals for demand resources to make
flexible energy use decisions
– Provides for full cost recovery of the flexibility offered
by demand resources
4
MISO Services for Demand Resources
• Energy and Ancillary Services Markets
– Day ahead Energy
– Real time Energy
– Ancillary Services Markets
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Emergency Procedures
Resource Adequacy
Ancillary Service Markets
Resource Planning
5
Day-Ahead Energy Market
• Participation in Day Ahead Market provides a hedge
against real-time congestion
• Offer types
– Fixed Demand Bid – Loads indicate the amount to be
purchased, regardless of price (~85% of market demand
on a daily basis)
– Price Responsive Demand (PRD) – Loads submit PRD
bids, either “physical” or “virtual,” to manage price risk
(~15% of market demand on a daily basis)
– Demand Response Resources (DRRs) – Treated in all
respects like generation; DRRs are evaluated and cleared
based on offer components, including start, notification,
minimum run times and availability
6
Real-Time Energy Market
• Participation in Real-Time Market provides price
signals for supplying real-time energy
• Offer types
– Price Responsive Demand (PRD) – Load Serving
Entities manage load by responding to Real-Time
clearing prices
– Demand Response Resources (DRRs) – DRRs can
be dispatched based on economics, in the same
manner as a supply-side resource
• Including ability to participate in 5-minute
balancing market
7
Ancillary Services Markets
• Enables demand resources to provide Ancillary
Services
– Spin and Regulation services
• Offer types
– Demand Response Resources Type I
• Capable of supplying a specific quantity of Energy to the
market through physical load interruption
• Committed in the same manner as a Supply Resource
– Demand Responsive Resource Type II
• Capable of supplying dispatchable Energy to the market
through behind-the-meter generation or controllable load
• Can be Committed and Dispatched in the same manner as
Generation Resources
8
Emergency Procedures
• Demand Resources during emergency conditions
are used to avoid load interruptions during RealTime generation emergencies
• Needed infrequently in MISO to date
• Demand Resources provided
– 3,000 MW of relief on August, 2006
– 300 to 500 MW in February 2007
9
Resource Adequacy
• Provides a mechanism for Demand Resources to be
counted as capacity similar to generation resources
by MISO Load
• Approximately 9,000 MW of Demand Response in
MISO is eligible to count towards capacity by MISO
Load
– Today most of this 9,000 MW is registered as
Emergency Demand Response
10
Resource Planning
• Enables MISO to plan the transmission system for
use of demand resources
– MISO conducts long-term reliability planning to
determine the need for and to coordinate new
investment in generation and transmission in each
region
– MISO, through its MISO Transmission Expansion
Planning (MTEP) process, has committed more than
$5b for new transmission investment
– In MTEP planning studies, demand resources
compete against generation or transmission to
address internal resource deliverability
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Questions?
12