Stakeholders are showing support for California Independent System Operator's new plan to account for forced outages when calculating the capacity needed for resource adequacy, but some still say the approach could add complexity, conflict with other resource adequacy mandates, and potentially overprocure capacity.
Incorporating forced outages into Cal-ISO's RA assessment is important because it will help inform which resources are most effective and reliable as the state transitions to a low- or no-carbon grid, the ISO said in its straw proposal.
After reviewing the way that other grid operators count needed capacity, Cal-ISO proposed to develop an unforced capacity, or UCAP, value that considers the chance that a resource will experience a forced outage at some point when it has been procured for RA capacity.
Cal-ISO will then conduct an assessment to ensure the UCAP values of the RA resource showings are collectively adequate to meet the ISO's system operational needs in all hours. UCAP would not apply to wind and solar because the California Public Utilities Commission already takes into account the probability of forced outages for these resources, the straw proposal said.
Many stakeholders seem open to the idea of using UCAP. But some worry that imposing the approach in Cal-ISO would make California's already complicated RA framework more complex.
NEW COMPLEXITY
For instance, Calpine raised concern that UCAP could add new complexity if local regulatory authorities like the CPUC do not adopt similar changes. "In the event that they do not, the CAISO and LRAs potentially would be relying on two similar but not identical ways of measuring capacity towards RA compliance and sufficiency, potentially creating confusion about what combinations of resources satisfy both LRA and CAISO requirements," Calpine said.
The Western Power Trading Forum believes Cal-ISO should do an in-depth look at reliability needs before fundamentally changing the RA program, said Carrie Bentley, a consultant for the group. But WPTF supports Cal-ISO setting system RA requirements, she said Monday.
"We do support the CAISO moving forward with UCAP proposal, if only so they get to set the system RA requirement," Bentley said. "Ideally the CAISO and CPUC would work together to set a consistent RA requirement," she said.
PROCUREMENT CONCERNS
Meanwhile, the California Large Energy Consumers Association noted that the CPUC's planning reserve margin includes an amount to cover forced outages as well as reserve requirements and load uncertainty. "Therefore, using UCAP in the accounting to meet the capacity target will lead to over-procurement because it will double count the forced outages," CLECA said.
It could also lead to conflicting resource target requirements for load-serving entities between the CPUC and CAISO accounting rules, which could lead to increased CAISO backstop procurement and hundreds of millions of unnecessary annual costs, CLECA said.
Morris Greenberg, an analyst with S&P Global Platts Analytics, said the ISO should be able to avoid double counting outages, so resource procurement need not be higher as a result of the change. "Switching to UCAP makes sense as resources that are available to serve load should count for more than resources with poorer availability," he said.
