Midcontinent Independent System Operator market participants in the southern region on Thursday discussed the paradigm shifts in operating conditions, generation fleet and market environment that are prompting strategic changes in the system's planning and market design.
At the beginning of the Gulf Coast Power Association's sixth annual MISO South Regional Conference in New Orleans, John Bear, MISO president and CEO, noted the following major issues:
More incidence of extreme weather
A generation fleet shift toward resources with zero or near-zero marginal cost
A trend away from large, high-capital-cost generation plants connected to the transmission grid and toward smaller, low-capital-cost generation spread over wider areas or connected via the distribution system
Increasing access to information about loads and resources behind the meter, which enables demand response
"Over the last 24 months, we've had five 500-year storms," Bear said. "I'm not a statistician, but I think that means they're not 500-year storms any more. ... but we don't really care. We just know it's happening, and we have to deal with it."
Complications raised by such events affect the trend toward zero-marginal-cost resources spread over wider areas. For example, MISO had a number of wind turbines in its North region trip offline during the January 31 emergency event because they "were not designed to operate at 40 [degrees] below zero, it turns out," Bear said.
MISO currently has more than 71 GW of generation in the queue, led by more than 32 MW of wind, almost 32 MW of solar, and more than 7 GW of natural gas-fired capacity, according to Bear's written presentation.
Today, almost half of MISO's generation fleet is coal fired, 24% is natural gas, 16% is nuclear, 8% is wind and 4% is some other type of generation.
Zero- or low-marginal-cost resources can help the grid, as wind and solar resources tend to be complementary, on average, with wind generation ramping up as solar power falls off, and vice-versa, Bear said. However, that average can mask significant events in which the grid operator must somehow quickly ramp up large amounts of generation capacity to cope with the loss of intermittent resources.
'EXTREME SCENARIOS'
In planning the grid and its operation, MISO has developed several scenarios, Bear said.
"It's clear to us that the more extreme scenarios are really where we need to focus our time," Bear said.
Those would include big cuts in the coal-fired fleet -- down to about 30% -- and big increases in wind and solar production, to a range of 13%-29% for wind and 7%-9% for solar, Bear's written presentation shows.
"When we started the market in 2005, we had about 300 MW of wind," said Richard Doying, MISO executive vice president for market strategy and development, said in a panel discussion. "It didn't seem like much of an issue on the system. We now have about a much larger proportion of wind, and by 2030, we expect to have about 30% of the generation within the region come from wind."
Jeff Bladen, MISO executive director for market development, said that until recently, MISO "knew what resources we could count on seven days" into the future. "That is no longer necessarily true," Bladen said during another panel discussion.
PLANNING BEYOND SUMMER PEAKLOAD
"We used to plan the system, from a resource adequacy perspective, ... for one peak hour in the summer season," Doying said. "We assumed -- and it was correct at the time -- that if we had enough generation to meet that one peak summer hour, we'd be fine the rest of the hours of the year. What we're finding now is that's simply not the case. ... All year long, we have to think ... 'Is that generation available, online, 8,760 hours a year when you actually need it?'"
Bladen said, "The problem is not whether we have enough installed resources to meet our annual requirement, but are those resources available where we need them, when we need them."
Jim Dauphinais, a managing principal at the Brubaker & Associates consultancy, said, "The reality is, where we are today in MISO is we have an 85,000-MW system in North-Central and a 35,000-MW in the South, connected by a 3,000-MW shoestring, at least with contracts and settlement agreements."
Therefore, energy emergency events tend to be concentrated on either side of that "shoestring," Dauphinais said, "because we very quickly hit that transmission limit."
Marcus Hawkins, executive director of the Organization of MISO States, which encompasses regulatory representatives from state, provincial and local regulatory jurisdictions, said the OMS supports studying a seasonal resource adequacy construct.
The OMS has also focused on facilitating distributed energy resources and demand response for about two years, Hawkins said, and they can play a role in resolving resource adequacy issues, but "they have not been used very much."
