Alberta Direct Connect Consumers Association

Implementation of MOF Recommendation Paper
Stakeholder Comment Form
Comments From:
Alberta Direct Connect Consumers Association (ADC); Industrial Power
Consumers Association of Alberta (IPCAA); and Office of the Utilities
Consumer Advocate (UCA) – submitted on a joint basis.
April 17, 2009
Sheldon Fulton, Executive Director - IPCAA
403 966 2300
[email protected]
WIND POWER FORECASTING – Centralized Forecasting Model
The AESO recommends that a centralized forecasting model be
implemented in Alberta.
X Support
F Oppose
F Indifferent
Reasons for Stakeholder Position:
Minimizing the forecast load variability discussed on p.16 is clearly critical to the reliable
operation of the AIS, and to the expected growth in wind resources. In the early stages of
forecasting skill development, a centralized approach is clearly preferable for the noted reasons
of efficiency, economics, uniform quality and accuracy (p.62). To the extent that this becomes
a material cost, its recovery from customers should be addressed in the AESO tariff
proceedings. Some level of cost sharing between loads who benefit from this generation and
the wind generators themselves would seem appropriate.
The AESO recommends that solicitation (RFP), evaluation and
selection of a centralized forecasting service provider should
proceed as soon as practicable.
X Support
F Oppose
F Indifferent
Reasons for Stakeholder Position:
The AIS’s ability to reliably use wind resources is clearly linked to forecasting accuracy. The
sooner forecasting skills development is initiated, the sooner this resource can expand its
energy provision to the system.
To the extent that the AESO’s forecasting pilot project demonstrated significant differences in
forecasters’ capabilities, consideration should be given to initially retaining multiple forecasting
providers. Once the data provision processes have been well established, the incremental
costs of diversity in the pure forecasting function will likely be small compared to the potential
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Implementation of MOF Recommendation Paper
Stakeholder Comment Form
The AESO will commence consultation on rules, procedures,
standards and technical requirements regarding submission of
wind generator forecast data/information including; data
requirement such as turbine availability and on-site
meteorological data, communication protocols, and data quality
required from wind generation facilities (or individual forecasters)
to deliver forecasts to the AESO.
X Support
F Oppose
F Indifferent
Reasons for Stakeholder Position:
Capturing comprehensive wind data is more urgent than retaining forecasting services. Every
day that data is lost is another day of lost knowledge. It is recommended that data recording
protocols be given the highest priority, particularly data such as on-site meteorological
information which once lost cannot be recovered.
Additionally wind generators should be required to provide access to at least three years of
historic wind data for their sites (if available) as a condition for connection to the grid to provide
inputs to the forecasting models.
As part of its forecasting research and development work, the
AESO will continue work to determine the capability, resources,
systems and time required to perform the data management
function. In parallel, the AESO will include data management as
an optional requirement in the wind forecasting RFP.
X Support
F Oppose
F Indifferent
Reasons for Stakeholder Position:
Wind forecasting is clearly a competitive industry, and it would be unwise to place data
collection and retention services in the hands of a forecaster whose incentives would be to set
the data repository up in a proprietary, closed fashion.
It would be preferable to retain an IT-focused entity not engaged in the forecasting business to
establish an ‘open’ data repository which can be made available to any forecaster the AESO
chooses. This would also ensure that the AESO maintains strong control over source data
dissemination, which is essential to maintaining the level of confidentiality required in respect of
this commercially sensitive data. It is understood that a strong competitive market for wind data
repository services already exists, and outsourcing this activity at this point would relieve
pressure on the AESO’s systems resources.
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Stakeholder Comment Form
The AESO will monitor forecasting, market and operational
results and develop measures of forecasting accuracy. The
AESO intends to leverage available data and forecasting
resources toward this end.
F Support
X Oppose
F Indifferent
Reasons for Stakeholder Position:
Different forecasting approaches will likely yield different types of forecast accuracy; some may
be strong in the longer term, others in near real-time. An understanding of the types of
accuracy yielded by various approaches will develop as experience is gained. This is an
important long term objective, but does not appear to be immediately critical. At this stage in
the process, the AESO might be well served by contracting with an external expert to provide
these assessments.
The AESO considers that system or aggregate wind forecasts should be
transparent and made available to all market participants, particularly
near term to real time.
X Support
F Oppose
F Indifferent
Reasons for Stakeholder Position:
Transparency should always be the default option, and the burden of proof as to confidentiality
properly belongs with the party making that contention. The benefits of transparency are well
captured in the AESO’s document. This is a requirement analogous to the publication of
scheduled unit outages, and creates a level information playing field for all generators.
It would be of greatest value if the AESO was to make the end results of these forecasts public,
so that their outputs could be compared and assessed. Some components of the input data
may be of value to analysts, but since this data has proprietary dimensions its general release
appears neither necessary nor desirable.
WIND POWER MANAGEMENT – Curtailment Protocol
The AESO seeks stakeholder feedback on the work group
recommendations to use a Potential MW Protocol and specifically would
like input from stakeholders regarding practicality and risks associated
with this option.
F Support
X Oppose
F Indifferent
1. Pro rata allocation of the system wide wind curtailment among Wind Power Facilities
2. Use of Potential MW Capability to allocate for each WPF
3. Curtailments should be re-assess and re-allocate every 20 minutes if the limit for any
one WPF has changed by greater than 5MW
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Reasons for Stakeholder Position:
It is suggested that this is fundamentally a question of market structure, from which an
operating protocol should then be derived. In general, market-based, bilateral solutions are
preferable to an imposed formula.
A “DDS-like” approach would be more consistent with the current market design, since this is
essentially a ‘constrained down’ requirement that flows from the generation system itself, just
as DDS flows from the transmission system itself.
A ‘bilateral’ approach to this problem is also worthy of consideration. Loads could be held
responsible for providing operating instructions consistent with the system’s requirements, in a
form that can be efficiently used by system operators.
It may be practical to set a date by which an alternative mechanism must be agreed to by
industry. If agreement is not reached by that date, then it would be helpful if the AESO’s
operations group identified an expedient default protocol (which, ideally, would be distasteful
enough to all parties to force agreement on a better approach).
It would also be expedient to consider implementation of negative pricing as the means to
allocate curtailment among the zero-offer community provided this was in concert with
introduction of an energy-ahead and imbalance market design. Note that negative pricing is
not a new concept - the Ontario average hourly price on April 10th was -$6.50/MWh, as
generation assets attempted to manage their activities.
The AESO solicits input from all stakeholders on the proposed supply
F Support
surplus protocol and proposed modifications to OPP 103 provided below.
X Oppose
F Indifferent
(1) Include wind power facilities and co-generation facilities in OPP 103
procedures with co-generation to be subject to Minimum Operating
Level (MOL) requirements
(2) Establish a Minimum Operating Level (MOL) for each asset and,
where possible, assets should not be dispatched below their MOL.
(3) Refine MOL definition to include new constraints not included in
Minimum Stable Generation 1 (MSG) but that affect the asset's ability
to operate at or below a threshold. MOL is a physical operating limit
(not an economic limit) for an asset constrained by legal/regulatory,
environmental, health and safety, equipment reliability, operating level
required to serve dispatched ancillary services, or operating level
required to prevent damages to third party equipment. Examples of
physical operating constraints for types of generation and
import/export are included in the WG paper (Appendix A).
(4) Develop a mechanism for pool participants to declare and submit the
MOL. It is expected that the need for, approach and frequency of
declaration may vary among generators and will need to be defined.
ISO Rule definition for MSG is “minimum stable generation” which means the minimum generation level
that an asset can be continuously operated at without becoming unstable.
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(5) Revise the current "inflexible block" definition. The definition of
"inflexible block" will need to be amended as follows:
"inflexible block" means a block of energy that may be dispatched on
or dispatched off, but not partially dispatched on, except for a $0 offer
block it may be dispatched to the asset's MOL.
Definition of "flexible block" does not require any changes since it
accommodates the proposed $0 SMP management protocol.
(6) Provide market indication of supply surplus conditions (similar to
supply adequacy situations) to provide market participants an
opportunity to take voluntary actions in the face of potential $0 SMP
conditions and also become aware that an out-of-market dispatch to
clear the energy imbalance could be forthcoming.
Reasons for Stakeholder Position:
It is suggested that this is fundamentally a question of market structure, from which an
operating protocol should then be derived. Alternatives include a ‘DDS-type’ model, negative
pricing, and ‘blind’ pro-rating, each of which may have advantages and disadvantages for the
zero-offer generators; however, none of the alternatives should be implemented without an
extensive review of the implications for the broader power market.
In addition, consideration must be given to the economic consequences of curtailment as well
as the reliability issues. Co-generation facilities that are supporting industrial processes with
thermal outputs often cannot be curtailed without significant impact to the production processes
supported by the steam. As such, all co-generation facilities that support industrial processes
should have the ability to designate an MOL that is based on this industrial need as well as the
other factors identified.
In any instance where the co-generation facility is part of an ISD, the facility must be fully
exempt from any OPP 103 provisions. It is unreasonable to have these units subject to any
dispatch risks induced by a supply surplus, as by definition they are part of an industrial
It is recommended that any changes to OPP 103 become part of a broader market dialogue
such that the concerns of other zero-offer generators are adequately captured in the
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Implementation of MOF Recommendation Paper
Stakeholder Comment Form
The Supply Surplus work group also developed the following protocol
respecting OPP 103:
F Support
X Oppose
F Indifferent
Step 1: Curtail opportunity services including import transactions.
Step 2: Take the following actions, taking into account the transmission
system operating and reliability constraints and an objective of
rotating the curtailments amongst market participants where
Curtail flexible $0 blocks, by pro-rata assignment,
Where wind generation is required to be curtailed pursuant to
(a), assign the curtailment amongst each individual wind power
facility using the wind power management protocol,
Curtail inflexible $0 blocks to the asset’s MOL.
Step 3: Curtail an asset to 0 MW (go off line), considering the asset’s
minimum off time.
Reasons for Stakeholder Position:
It is suggested that this is fundamentally a question of market structure, from which an
operating protocol should then be derived.
The initial step of curtailing imports appears manifestly unfair, particularly since importers may
have to make significant financial commitments in order to obtain transmission services to the
Alberta border, and Load Shed Requirement (LSR) support for these transactions may already
be committed.
The concept of decision-making based on physical requirements of assets is fundamentally in
conflict with decision-making based on the economic preferences of market participants. Such
‘mixing of models’ inevitably leads to complex ‘seams issues’, which could be avoided by
selecting one model and rigorously adhering to its requirements.
Please refer to comments on Issue #7 as well.
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Implementation of MOF Recommendation Paper
Stakeholder Comment Form
Technical Requirements and Standards
Given the expected difficulty and expense in modifying and/or retrofitting
some existing wind power facilities, the WPFTR (s 1.2 g) provided an
exemption from the 2004 requirements for any facilities that
interconnected under the technical requirements that were in effect prior
to November 15, 2004 but specified that these facilities would be
required to comply with the WPFTR if the facilities underwent a
refurbishment or major upgrade.
X Support
F Oppose
F Indifferent
The AESO considers that this approach is reasonable and prudent but
expects that the issue of applicability should be discussed in the rules
and standards development and consultation phase. This will include a
discussion of the potential grandfathering of certain wind facilities based
on the terms and conditions of interconnection agreements and other
relevant information.
Reasons for Stakeholder Position:
This appears to be a balanced and practical solution.
Although the solutions to issues as set out in the MOF appear to have
the consensus support of wind-developers, they do not take into
consideration the implications of significant increases in wind generation
on the operation of the hourly market nor on implications for system
These broader issues demand a more comprehensive
consultative approach.
March 2009
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