Eyeing a launch date of November 2007, Cal-ISO at last has come forward with plans for revamping its widely disparaged wholesale market design. The formal proposal, known as the MRTU (Market...
Squeezing Scarcity From Abundance
California's pursuit of a centralized administrative solution in reliability hinders everyday operational issues.
to be addressed after the planning reserves are determined. Again, although this is a question of accounting, it always makes the comparison of Cal-ISO's calculations with the rest of the electric industry unnecessarily challenging.
The first step, determination of capacity, already should have taken into consideration standard issues such as thermal constraints. The ISO's determination yielded 22,643 MW of capacity available on a planning basis. The CEC listed 20,980 MW available within SP-15.
While the ISO assumed more capacity, it also had higher forced outages and transmission limitations. Its assumed forced outages are troubling. Since time immemorial, thermal systems in the WECC have used 7 percent as an operating reserve to meet the risk of forced outages. 22 The forced outages forecast by the ISO were 1,975 MW across a resource base of 24,956 MW-a forced outage of 7.9 percent. This is higher than the official ISO's operating reserve percentage.
Taken in isolation, this implies that the ISO believed that the WECC standard for thermal system reserves is too low. As mentioned above, there are good reasons why the ISO has experienced apparent forced outages much higher than any other control area. Even so, this assumption makes the minimum operating reserve criterion adopted by the ISO irrelevant and brings into question the ISO's filings with the WECC on reliability standards. Simply said, the ISO has assumed a level of forced outages that by themselves would make their own operating reserve criterion imprudent.
The ISO also assumes a much higher transmission limitation than the CEC. The ISO did not document its assumption, so it was difficult to evaluate the likely importance of these limitations. The CEC report mentioned transmission constraints on contractual deliveries from Mexico. Logically, the ISO may still be viewing constraints on Path 15. Given both reports, it is clear that SP-15 should be viewed as an independent reliability sub-region and reported as such to the WECC.
After considering outages and transmission limitations, the ISO and CEC estimates were surprisingly close: 18,980 MW for the CEC and 19,168 MW for the ISO.
The Cal-ISO report does not document imports into SP-15. They so closely approximated the CEC value that it was logical to address the CEC derivation as the basis for both values (see Table 4) .23
The final match for the two reports is very close:
Both agencies agreed that operating reserves were tight during the August peak on an operating level. The extremely high forced outages assumed by the ISO indicated a slightly dourer outcome.
SP26 Net Interchange
The basic difference between traditional utility operations and those at Cal-ISO is the timing of reserve purchases. In any other WECC control area, this situation would call for a serious effort to contract for summer capacity. Depending on the various assumptions itemized above, the California ISO needed to raise the committed capacity imports between 500 to 1,000 MW above its current assumptions.
This was not a serious problem when the WECC showed a capacity surplus of 49,749 MW for summer peak in 2005. 24 The Pacific Northwest had 27,722 MW,