During the March 10, 2022, Markets Subcommittee (MSC) meeting, MISO provided an overview of proposed Tariff changes clarifying forecasting for Hybrid Resources registered as Dispatchable Intermittent Resources (DIR). Redline Tariff language was posted with materials. Stakeholders were asked to provide feedback on the posted language.
Please provide feedback by March 24.
On behalf of Xcel Energy, Vistra, Clean Grid Alliance, Fresh Energy, Next Era Energy, Entergy Operating Companies, Alliant Energy, DTE, and Great Plains Institute,
We thank MISO for its continued work to address market barriers to emerging hybrid resources. We also understand MISO’s current approach is to identify near-term solutions leveraging existing market rules and constructs. That said, we have identified several key questions that were not fully investigated by MISO prior to the March 10, 2022 Market Subcommittee but need to be prior to filing tariff changes that may be overly restrictive. At a high level we believe hybrid resources, especially given the flexibility and responsiveness of hybrids with energy storage components, can address some of the very issues MISO seems to seek to address. Our hope is that short-term market rules will not inadvertently disincentive these resources. We ask that MISO consider these issues further prior to filing the proposed tariff changes, and modify its proposed filing as needed based on further discussion with stakeholders.
Cases for which the existing DIR rules are appropriate for DIR-Hybrids
Stakeholders have identified several hybrid resource designs for which the availability of the MISO-generated forecast and associated penalty exemptions may be appropriate. First, wind-solar hybrids should be allowed to use the existing DIR construct. Their output is purely a function of wind and solar availability which can be accurately captured in a MISO-developed forecast.
Second, some renewable+battery hybrids may also behave much like a stand-alone DIR. For example, if the ICAP of a renewable component were 90% of the total ICAP of the hybrid, the hybrid’s output would still largely be driven by the intermittent component. The battery could be operated in a way to help meet forecasted output during high loads when the intermittent output versus its forecast could be lagging. The battery could also be used during high loads along with the intermittent component such that total power production does not exceed its interconnection rights. MISO should consider a threshold of relative sizing of hybrid intermittent and storage components (e.g., 90% intermittent), under which the DIR-hybrid can use the existing DIR rules to enable these resources to provide their full capabilities and value to the MISO market.
Lastly, there may be times that a battery component of a hybrid may be offline for maintenance or other reasons. Note that we do not use the term “outage” or “offline” to mean the battery is online and idle, but unavailable. While this is not expected to be a frequent occurrence in these cases the renewable component of the hybrid would be acting as a stand-alone DIR and should therefore be eligible to use the existing DIR MISO-forecast and subsequent penalty exemptions.
Battery visibility and hybrid resource forecast considerations
Stakeholders appreciate MISO’s desire to gain visibility into battery component operations to support efficient commitment and dispatch of hybrid and other resources, and to ensure system reliability. To the extent MISO feels it needs to apply deficient energy charges to hybrid resources, we suggest MISO recognize that the storage component may have a limited ability to address any deficiency depending on system design. Consider the example of a hybrid resource with a 10MW battery and a 90MW solar components. Assume MISO forecasts a sunny day with 80MW total output but a storm materializes in real-time so that total output is only 40MW. Clearly the vast majority of the deficient energy is due to forecast error and not the operation of the battery. The resource should be responsible for no more than 10 MW of deficient energy and not the entire 40 MW difference.
We also urge MISO to fully explore options to leverage the existing DIR forecast process to continue to develop forecasts for intermittent components of DIR-hybrids. This could include the option for Market Participants to add sub-metering so that MISO can receive the same data it does today for stand-alone DIRs. This would alleviate MISO’s concern regarding accuracy of the MISO forecast while supporting market participant needs. In the above example, if sub-metering showed that the energy storage component had output of 10 MW, then the resource should not be responsible for any deficient energy charge. MISO could leverage its recently filed tariff changes in Docket ER22-1062, now in Tariff Section 40.2.5, and compare the MP-submitted forecast to MISO’s intermittent component forecast. If the delta between the two forecasts does not exceed the nameplate capacity of the battery component, MISO can be assured that the MP’s output is not biased. In this case, the same logic that was used to develop the DIR excess/deficient energy penalty exemptions could be applied to DIR-Hybrids. That is, when these resources are able to provide valuable energy to the grid, they should be incentivized to do so.
Co-location of resources may be an option to address MISO’s desired visibility into battery operation for some projects, but not all. Sharing inverters and other equipment in a hybrid configuration to reduce system costs is a meaningful part of the business case for many hybrids. For “tightly coupled” hybrids, co-location and separate market registration may not be feasible as the battery component would not be able to charge from the grid. Further, the storage facility can avoid costly losses by charging from the associated intermittent resource rather than the grid. Ultimately, the underlying business case should drive whether a facility is designed as hybrid or co-located rather than short-term market rule limitations.
Future solutions
We understand MISO’s desire to limit the amount of time and resources needed to enable hybrid resources in the near-term and that a broader effort will be taken up in Q1 2023. However, Hybrids will make up a large portion of the generation coming online in the future and will only continue to grow – therefore it is imperative that MISO prioritize efforts to understand and develop a pathway to full market participation for these resources.
To the extent MISO determines any of the solutions proposed above or developed through stakeholder discussions are too resource-intensive to carry out now, we ask that MISO clearly document the specific processes and challenges that pose barriers such that this information can be carried forward into future stakeholder discussions. Also, to support an expeditious path to a robust solution in 2023, we ask MISO to evaluate the multi-configuration framework for compatibility with hybrid resource needs and share its insights with stakeholders.
Finally, we note the hybrid resources that plan to come online before 2023 need a stable set of rules that can be used to drive design decisions as the resources are constructed. It would be helpful to clarify for stakeholders the details of how hybrid resources can participate as both generators and DIRs. We also urge MISO to look at other ISO best practices – especially ISO’s that already have hybrids participating in their markets such as CAISO.
Thank you,
Matt Prorok, Great Plains Institute
WPPI offers the following feedback on the proposed Tariff changes posted with the MSC, 3/10/2022 materials, which clarify the source of the Forecast Maximum Limit for a Hybrid Resource registered as a Dispatchable Intermittent Resource is either the Market Participant or State Estimator:
‒ WPPI suggests the proposed text (40.3.4) in brackets be replaced with: “, except the Transmission Provider shall not develop a Forecast Maximum Limit for a Hybrid Resource registered as a Dispatchable Intermittent Resource.”
‒ Comment: In the currently proposed text, “for which” seems to leave open the possibility that there are some Hybrid Resources registered as Dispatchable Intermittent Resources for which the Transmission Provider does/would develop a Forecast Maximum Limit.
National Grid Renewables appreciates the opportunity to comment on the proposed hybrid resource tariff revisions. Market participation for hybrid resources is a critical issue to be addressed in MISO, and stakeholders will benefit from increased certainty in this area. National Grid Renewables provides the following comments on the proposed tariff language.
National Grid Renewables also notes that currently, there is no market participation model that fully enables hybrid resources to provide their full value to the MISO market. National Grid Renewables appreciates that MISO will be more holistically assessing hybrid resources in 2023 but emphasizes the importance of its timeliness in the near term. As of March 11th, 2022, there are 4,500MW of hybrid resources currently under study in the MISO footprint with applied in-service dates beginning in 2022.
Developers and market participants require more certainty on hybrid participation, and MISO should pursue hybrid-specific participation model that will enable hybrids to provide the full value of their capabilities to the grid as soon as functionally possible. National Grid Renewables appreciates the magnitude of this work, thanks MISO for their future attention to this issue and looks forward to working with MISO to achieve the goals of this initiative in both the interim and long-term timeframes.