Business Practice: Self-Supply of Operating Reserve
Effective Date: October 1, 2014
Purpose:
This Business Practice applies to the self-provision of Puget Sound Energy, Inc.’s (“PSE”)
Open Access Transmission Tariff’s (“OATT”) Schedules 5 and 6, Operating Reserve –
Spinning and Operating Reserve – Supplemental, respectively.
The new WECC Regional Reliability Standard BAL-002-WECC-2, Contingency Reserve,
became effective October 1, 2014. This new standard redefines a Reserve Sharing
Group’s or Balancing Authority’s responsibilities in maintaining adequate contingency
reserve.
This business practice provides guidelines, process descriptions, and other requirements
for Transmission Customers wishing to self-supply, or to arrange for third-party purchase
of, OATT Schedules 5 and 6. This business practice will be an interim practice and subject
to change as requirements are clarified within the Western Electric Coordinating Council
(“WECC”) and Northwest Power Pool.
Definitions:
Operating Reserve:
That capability above firm system demand required to provide for regulation, load
forecasting error, equipment forced and scheduled outages, and local area protection. It
consists of spinning and non-spinning reserve.
Operating Reserve – Spinning: As defined by the North American Electric Reliability
Corporation (“NERC”), Operating Reserve – Spinning is the portion of Operating Reserve
consisting of:

Generation synchronized to the system and fully available to serve load within the
Disturbance Recovery Period following the contingency event; or

Load fully removable from the system within the Disturbance Recovery Period
following the contingency event;
provided, however, that under BAL-002-WECC, Operating Reserve – Spinning must also
be:

Immediately and automatically responsive to frequency deviations through the action
of a governor or other control system; and

Capable of fully responding within ten minutes.
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Operating Reserve – Supplemental: As defined by NERC, Operating Reserve –
Supplemental is the portion of Operating Reserve consisting of:

Generation (synchronized or capable of being synchronized to the system) that is
fully available to serve load within the Disturbance Recovery Period following the
contingency event; or

Load fully removable from the system within the Disturbance Recovery Period
following the contingency event.
provided, however, that under BAL-002-WECC, Operating Reserve – Supplemental must
also be:

Capable of fully responding within ten minutes.
Practice
1. Spinning and Supplemental Services
A Transmission Customer must satisfy its obligation to acquire Operating Reserve
through one of the following alternatives:
• Purchase from PSE Transmission Services
• Self-Supply
• Third Party Supply
2. Selection of an Operating Reserve Supplier
At the time a Transmission Customer makes its initial request for transmission service
with PSE, the Transmission Customer must notify which Operating Reserve services
will be provided by PSE. If the Transmission Customer elects to self-supply or third
party supply it must indicate its suppliers for Operating Reserve services.
PSE Transmission is the default provider under any of the following conditions:

No election was made by the Transmission Customer

The designated supplier fails to perform to its obligation

The supply arrangements made by the Transmission Customer are not
comparable to purchasing Operating Reserve services from PSE
Transmission

A designated supplier and/or PSE have not completed implementing and
testing the necessary interfaces, systems, or software required in order to
comply with this Business Practice.
PSE will allow Transmission Customers to change their supplier of Operating Reserve.
A Transmission Customer desiring to change its supplier of Operating Reserve must
make its election in writing or electronic form to PSE prior to the desired self-supply start
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date consistent with Section 16.2 of PSE’s OATT, and stating whether the Transmission
Customer intends to:

Obtain Operating Reserve from a Third Party

Self-supply Operating Reserve

Purchase Operating Reserve from PSE Transmission Services
If the Transmission Customer does not intend to change its supplier of Operating
Reserve, no action is required.
If the Transmission Customer elects to change its supplier, PSE Transmission Services
will review the Transmission Customer’s proposed arrangements for supplying
Operating Reserve. This review is necessary to assure that any proposed arrangements
to supply operating reserve meet NERC and WECC reliability requirements and that
they will be able to meet the requirements of this Business Practice.
If PSE is unable to implement the Transmission Customer’s proposed arrangements by
the election period start date, PSE will provide the Transmission Customer with an
approximate date on which PSE will implement the Transmission Customer’s
arrangements.
If conditions change such that the Transmission Customer is no longer able to meet its
obligation to supply Operating Reserve by self-supply or third-party supply, or if a
supplier becomes unable to meet the Eligibility Criteria for suppliers detailed in section 3
below, PSE will notify the Transmission Customer that PSE will be the default provider
for the time remaining in the election period.
If a Transmission Customer elects to self-supply or acquire services from a third-party
supplier, the Transmission Customer is responsible for all costs necessary to meet its
obligation to supply Operating Reserve, including costs for the acquisition, installation,
and maintenance of communications, control equipment, and systems in PSE’s
operating control center systems.
3. Eligibility Criteria for Suppliers
General Requirements
The supplier must be capable of delivering the amount of capacity that the
Transmission Customer is obligated to provide under Schedules 5 & 6 of the PSE
OATT.
PSE will determine the amount of energy delivered when Operating Reserve
service is called upon.
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The supplier must comply with applicable WECC or NERC (or successor
organizations) standards except where the WECC standards are in conflict with
local regulatory requirements, in which case the local regulatory requirements
apply. The applicable WECC or NERC (or successor organizations) standards
include but are not limited to the following:

WECC Standard BAL-002-WECC-2 - Operating Reserve or its successor.

NERC BAL-002-1 or its successor.
The Transmission Customer must be able to demonstrate that it can satisfy all of
the requirements of this Business Practice.
Self or Third-party Supply of Operating Reserve – Spinning
BAL-002-WECC-2 requires resources and arrangements for Operating Reserve Spinning to be on-line, immediately responsive to frequency, utilizing firm
transmission service, and capable of fully responding within 10 minutes.
PSE will consider all offers for Operating Reserve - Spinning as long as such offers
provide a comparable or equivalent level service as PSE’s Balancing Authority
resources provide. For the interim, PSE will accept a capacity tag while the
Transmission Customer(s) work with PSE towards establishing dynamic transfer
arrangements.
Capacity Tag
This transaction requires the purchase of firm transmission service to support the
delivery of Operating Reserve-Spinning when requested by the PSE Balancing
Authority.
Direct Transfer
The Transmission Customer’s supplier may use a resource in another Balancing
Authority to supply Operating Reserve - Spinning provided that the resource's
deployment signal is automated and that PSE can observe a distinct measurable
response. The PSE Balancing Authority will work with the Transmission Customer to
establish appropriate telemetry at the customer’s expense to facilitate the activation
of Operating Reserve-Spinning.
The supplier's Energy Management System for deployment of reserve must be able
to communicate with PSE’s control center and must be staffed 24 hours a day, 7
days a week to assure dispatch contact is available.
Self or Third party Supply of Operating Reserve – Supplemental
PSE will consider offers for Operating Reserve - Supplemental as long as such
offers provide a comparable or equivalent level of service to the resources in PSE’s
Balancing Authority.
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Capacity Tag
This transaction requires the purchase of firm transmission service to support the
delivery of Operating Reserve-Supplemental when requested by the PSE Balancing
Authority.
10-Minute Recallable Tag
This transaction can be interrupted at any time when requested by PSE. 10-Minute
Recallable tags must be submitted in the day-ahead time frame.
4. Customer and Supplier Performance
If the Transmission Customer is unable to deliver energy or set aside capacity, it will be
responsible for any penalties, or costs incurred by PSE as a result of the Transmission
Customer’s failure to meet its obligations under the OATT and this Business Practice.
PSE Transmission reserves the right to immediately suspend the Customer’s
permission to self-supply or use a third-party supply should the Transmission Customer
or its supplier fail to meet the requirements of the OATT or this Business Practice or in
the case of an emergency.
The Operating Reserve must be available at all times; fully deliverable within 10minutes after PSE sends a signal for Operating Reserve; and sustainable for 60
minutes.
PSE reserves the right to perform unannounced capability tests to assure that capacity
is fully available within 10-minutes. If the Transmission Customer fails the capability
test, the supplier could be subject to suspension and any costs incurred by PSE.
If the Transmission Customer is not carrying the full amount of its Operating Reserve
requirement, the supplier could be subject to suspension and any costs incurred by
PSE.
If the Transmission Customer fails to fully meet its Operating Reserve deployment
requirement, the supplier could be subject to suspension and any costs incurred by
PSE.
The Transmission Customer shall be required to demonstrate that it has adequate, firm
transmission available to deliver the reserve to PSE across all associated paths of all
involved Balancing Authorities. If the Transmission Customer does not have firm
transmission available to deliver its Operating Reserve obligation, the supplier could be
subject to suspension and/or penalties, and any costs incurred by PSE.
If firm transmission is not available, the Transmission Customer must arrange an
alternative delivery to PSE. These alternatives include the following:

Carrying reserve on resources not affected by the posted constrained path

Using transmission capability from the supplier's existing rights

Acquiring transmission rights
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