WHAT IS A SCHEDULING COORDINATOR?
At least 33 organizations know the answer to that question in California because by late last year that's how many SCs had filed to act as go-betweens to the independent system operator.
Although the definition varies depending on who's asked, an SC is simply a preschedule and dispatch office. An SC puts a power schedule together for itself or for energy service providers a day ahead or hour ahead. It submits the schedule to the ISO, gets it approved, then makes adjustments in "real time."
SCs are the outcome of a decentralized market, one where the ISO has few market-making functions. SCs were formed to manage a myriad of generation and transmission transactions from millions of users. The ISO, meanwhile, keeps the lights on for the state's 31.2 million people by operating the transmission system to accommodate the state's 58,000 megawatts of generation.
SCs will charge fixed or transaction-by-transaction fees for each schedule they put together. But since market participants estimate it costs as much as $3 million to get into the SC business full scale, coordinators will have to find additional income sources. Market savvy and transaction fees only go so far. One observer says that 10 cents either way on a megawatt-hour of commodity can make a transaction profitable or unprofitable for an SC, creating a "battle of the dimes" (see sidebar, "Sample SC Transaction").
Two requirements determine start-up costs: SCs must operate year-round, 24 hours a day so the ISO can always find someone to talk to. And SCs must be creditworthy; they are financially liable to the ISO for imbalances. Meeting agreed schedules at agreed locations is a coordinator's duty.