Wind surge in ERCOT prompts PUC ‘concern’ about nonmarket uplift
Hearing about the continuing surge of wind generation in the Electric Reliability Council of Texas, a state regulator on Tuesday expressed “concern” about too many out-of-market actions to ensure local reliability threatened by a sudden drop in wind output.
Early in the ERCOT Board of Directors meeting, Bill Magness, ERCOT president and CEO, pointed out that wind generation hit a new record of 50% of load early on March 23, with about 1,500 MW of wind curtailed. If that wind generation had not been curtailed, wind’s share of all load would equal about 55%.
And on Friday, ERCOT hit a new record for total wind generation, at 16,141 MW, which equaled almost 40% of load at that time and represented a capacity factor of almost 90%.
Magness reported that ERCOT had 18,064 MW of wind generation nameplate capacity as of January 31, and if all the wind farms with generation interconnection agreements were built — which is not likely — that number would grow to about 28,000.
Dan Woodfin, ERCOT senior director of system operations, described a new “reliability risk desk” that became operational at the end of January so ERCOT grid operations personnel can “manage certain risks” that have grown “with the changing resource mix on the system.”
The new function will cope with the growing ramifications of wind and solar forecast errors, the need for larger net load ramps, a low level of electrical inertia in the system and variable ancillary service needs, Woodfin said.
The new operation is expected to improve the accuracy of wind and solar forecasts, improve telemetry performance at wind and solar facilities, and perform forecast adjustments during extreme weather events.
One way ERCOT maintains reliability in constrained areas is by dispatching generation resources on a “reliability unit commitment” basis, with the cost of operating that unit uplifted to the market, and those RUC deployments have increased in recent months, Woodfin said, but these are “more … reflective of the fact that the market has changed its commitment behavior” than it is of increased wind generation.
However, Ken Anderson, a member of the Public Utility Commission of Texas, said that despite the fact that ERCOT’s management seems to be unconcerned about growing RUC deployments, “I can tell you that they are a concern to the commission.”
“I view RUCs as a market failure or a failure by the operators, one or the other,” Anderson said. “Presumably, if you are RUC-ing, there is heightened risk of some kind, and if that is not being reflected in real-time [prices], maybe it should be. … Ultimately, we’d strongly prefer a market-based outcome.”
ERCOT’s Operating Reserve Demand Curve was established to provide a price adder as operating reserves diminish, but the ORDC is only applied on a systemwide basis and cannot be applied to resolve local scarcity conditions, Woodfin said.
But Anderson said, “If ERCOT is having to take out-of-market actions, that signifies an issue that ought to be reflected in the available reserves that are dispatchable.”
During later discussions, Kenan Ogelman, ERCOT vice president for commercial operations, said stakeholders have begun a process to study the viability of co-optimization of real-time energy and ancillary services, which may result in the establishment of what would effectively be ORDCs for local areas.
