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Tranche Warfare

The experts do battle over capacity market design.

Fortnightly Magazine - December 2013
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as the “replacement capacity” issue, and which was scheduled initially to be presented to the members committee for endorsement on December 13, will instead be returned to the capacity senior task force, which will attempt to forge more precise tariff language.

Importantly, PJM’s Ott took time at the September FERC conference to emphasize the importance of the DR operational initiative, explaining how, at present, without the needed reform, the DR resources cleared in the PJM RPM are dragging down the diversity of the region’s resource mix:

“To some extent,” as Ott testified in September, “we are victims of our own success.

“We have 14,000 MW of demand response … [clearing in RPM] … but 13,000 of it gives us only two hours’ notice and the same price. So I have an 8 to 9 percent resource block that all looks the same.

“We can’t sustain that.”

 

Endnotes:

1. Dkt. ER13-550, Mar. 29, 2013, 142 FERC ¶61,248.

2. Centralized Capacity Market Design Elements, FERC Dkt. AD13-7, Aug. 23, 2013.

3. Evaluation of the New York Capacity Market, FTI Consulting, March 2013, exec. summary, p. xii.

4. Dkt. ER1380, Aug. 13, 2013, 144 FERC ¶61,126.

5. Request for Rehearing, pp. 5, 9-10, FERC Dkt. ER13-1380-001, Sept. 12, 2013.

6. Request for Rehearing, pp. 2, 8-9, 15, FERC dkt. ER13-1380-002, filed Sept. 12, 2013.

7. Request for Partial Reconsideration, FERC Kt. ER13-1380-000, filed Oct. 28, 2013.

8. Dkt. EL12-98, Nov. 21, 2013, 145 FERC ¶61,156.

9. “ No Fuel, No Power ,” Public Utilities Fortnightly, April 2013, p. 20.

10. Performance Incentives in ISO New England’s Forward Capacity Market, pp. 11-12, study prepared for NextEra Energy Resources, CRA Project D18053-01, July 2, 2013.

11. Assessment of the Impact of ISO-NE’s Proposed Forward Capacity Market Performance Incentives, by Todd Schatzki and Paul Hibbard, The Analysis Group, September 2013, p. 4.

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