Stakeholder Comment and Rationale Form
AESO AUTHORITATIVE DOCUMENT PROCESS
Stakeholder Consultation Draft
2011-06-16
Proposed New ISO Rules Section 202.7 Markets Suspension or Limited Markets Operations (“New ISO Rules Section 202.7”)
Date of Request for Comment [yyyy/mm/dd]:
Period of Consultation [yyyy/mm/dd]:
Comments From:
2011/06/16
2011/06/16
through 2011/07/07
Company Name
Contact:
Company Contact
Phone:
Contact Phone Number
E-mail:
Date [yyyy/mm/dd]:
Listed below is the summary description of changes for the proposed new, removed or amended sections of the ISO rules. Please refer back to the Letter of Notice under the “Attachments to
Letter of Notice” section to view the actual proposed content changes to the ISO rules. Please place your comments / reasons for position underneath (if any).
1. ISO Rules Definitions
Stakeholder Comments and/or Alternate Proposal
(a) New
There are no new ISO rules definitions associated with proposed New ISO Rules
Section 202.7.
Comment # 1: Insert Comments / Reason for Position (if
any)
(b) Removals
“Package 9” ISO Rule Definition Changes, containing amendments to ISO rules
definitions, are being consulted on concurrently with proposed New ISO Rules
Section 202.7. Click here to view the Letter of Notice for the “Package 9” ISO
Rules Definition Changes.
Comment # 2: Insert Comments / Reason for Position (if
any)
(c) Amendments
There are no amendments to ISO rules definitions associated with proposed New
ISO Rules Section 202.7.
Comment # 3: Insert Comments / Reason for Position (if
any)
Issued for Stakeholder Consultation: 2011-06-09
AESO Replies
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2. ISO Rules
(a) New
Proposed New ISO Rules Section 202.7 are require to implement the use of
limited markets operations under the conditions when the AESO experiences
temporary outages to the dispatch tool and the energy trading system that
materially impedes the AESO’s ability to accurately and substantially issue
dispatches to the energy market, ancillary service market or the dispatch down
service market.
Stakeholder Comments and/or Alternate Proposal
AESO Replies
Comment # 4: Insert Comments / Reason for Position (if
any)
Proposed New ISO Rules Section 202.7 further defines the conditions when the
AESO may suspend the energy market, the ancillary service market and the
dispatch down service market, and specifies the energy pricing and cost recovery
provision during a markets suspension.
The AESO has redrafted and relocated the authoritative provisions of the
following ISO rules into proposed New ISO Rules Section 202.7 and is proposing
to remove these ISO rules in their entirety when proposed New ISO Rules Section
202.7 come into effect:
a) Removal of existing ISO OPP 201 Energy Market Suspension; and
b) Removal of existing ISO Rules Section 6.9 “Energy Market Suspension”
Rationale for each of the subsections of proposed New ISO Rules Section 202.7
is provided below.
Subsection 1 - Applicability
The AESO proposes that New ISO Rules Section 203.7 be applicable to market
participants and the AESO, and will be of specific interest to pool participants.
Subsection 2 – State of Limited Markets Operations
This section sets out the conditions under which the AESO may declare limited
markets operations.
Comment # 5: Insert Comments / Reason for Position (if
any)
Comment # 6: Insert Comments / Reason for Position (if
any)
If the AESO’s Energy Trading System tool that populates the merit order or the
Issued for Stakeholder Consultation: 2011-06-16
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Dispatch Tool that performs the inter-markets dispatch calculations is unavailable,
or if the system controller cannot access the Dispatch Tool due an evacuation
from the primary system coordination centre, the system controller may not be
able to issue energy market dispatches using the most up to date energy market
merit order. Without the Dispatch Tool it is very difficult for the AESO to manually
perform the inter-markets calculations with the ancillary service market and the
dispatch down service market, and therefore, the dispatching of these markets can
only be performed with certain restrictions.
Certain of these requirements have been redrafted and relocated from existing
ISO rules subsection 6.9.2(d).
Subsection 3 – Declaration Invoking Limited Markets Operations
This subsection requires the AESO to make a declaration when it deems that
conditions exist that require it to invoke limited markets operations. This
subsection also specifies the information that the declaration must include and
method by which the AESO will issue the declarations.
Comment # 7: Insert Comments / Reason for Position (if
any)
These requirements have been redrafted and relocated from existing ISO rules
subsection 6.9.3.
Subsection 4 – Dispatches During State of Limited Markets Operations
This subsection specifies how the AESO will dispatch assets in the energy,
ancillary, and dispatch down service markets once a state of limited markets
operations has been declared.
Comment # 8: Insert Comments / Reason for Position (if
any)
Since the AESO may not have access to the latest energy market merit order
when required to issue energy market dispatches to balance system supply and
demand, the AESO will be dispatching from the most current and reasonably
accurate energy market merit order, which is either a hardcopy that has been
printed or an electronic copy that has been downloaded, typically at the start of
the hour or just prior to the planned outage of the applicable IT system tool.
This requirement has been redrafted and relocated from existing ISO OPP 201.
In order to minimize the impact to energy market dispatching, dispatches to the
ancillary services market and the dispatch down services market will be
restricted. Operating reserves and dispatch down services that have been
dispatched at the start of the limited markets operations will remain dispatched.
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Even if the operating hour has advanced to the next hour, and even if there is a
transition from on peak hour to off peak hour (or vice versa) the system
controller will leave the dispatched operating reserves and dispatch down
services unchanged.
The only situation when the AESO will change the dispatched dispatch down
services is when the AESO has dispatched to above the reference price. In this
case, the AESO will dispatch off all or part of the dispatch down services.
Subsection 5 – Energy Market Pricing During State of Limited Markets
Operations
Comment # 9: Insert Comments / Reason for Position (if
any)
This subsection specifies how the AESO will determine pool price and system
marginal price during a state of limited markets operations.
Since the AESO is dispatching the energy market using the most current and
reasonably accurate energy market merit order, the system marginal price will
be set based on that particular energy market merit order used by the system
controller for dispatching.
These requirements have been redrafted and relocated from existing ISO rules
subsection 6.9.4.
Subsection 6 – Other Pricing During State of Limited Markets Operations
This subsection specifies the requirements for dispatch down service payments,
ancillary service payments, and uplift payments during a state of limited
markets operations.
Comment # 10: Insert Comments / Reason for Position
(if any)
Similar to energy market pricing, the dispatch down services and ancillary
services pricings will be based on the system marginal price and the pool price,
respectively, calculated based on the energy market merit order that is used by
the AESO in issuing energy market dispatches.
Since the calculation for the uplift payments for suppliers on the margin depend
on data exchange between the energy trading system and the dispatch tool,
when either one of these systems is unavailable this calculation may be
incorrect. Therefore, it may be necessary to suspend that payment.
Subsection 7 – Termination of the State of Limited Markets Operations
Issued for Stakeholder Consultation: 2011-06-16
Comment # 11: Insert Comments / Reason for Position
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This subsection specifies the requirements for terminating a state of limited
markets operations.
(if any)
In order to minimize the impact from limited markets operations, the AESO must
terminate limited markets operations as soon as the AESO regains access to
the energy market merit orders through the energy trading system and the
Dispatch Tool. The AESO must issue a declaration to inform market
participants of the date and time of the termination of limited markets
operations.
Certain of these requirements have been redrafted and relocated from existing
ISO rules subsection 6.9.5.
Subsection 8 – State of Markets Suspension
This subsection sets out the conditions under which markets suspension may
be declared and who has the authority to do so.
Comment # 12: Insert Comments / Reason for Position
(if any)
Existing ISO rules Section 6.9 were developed as part of the contingency
planning efforts for markets suspension even though it has never happened
since the inception of the power pool in 1986, and not anticipated to happen in
the future.
The conditions under which the AESO may invoke markets suspension are:
a)
the interconnected electric system is experiencing a blackout;
b)
the interconnected electric system has broken into islands to an extent
that significantly impedes or prohibits markets operations; and
c)
the AESO is unable to continue limited markets operations because of
material variances between pool assets capabilities and the energy
market merit order in use by the AESO, or the AESO is unable to perform
merit order functions at the backup coordination centre after being
evacuated from the primary coordination centre.
Since markets suspension is considered to be an extremely significant event, it
must be authorized by the AESO CEO, except if it is due to a blackout, where
AESO Operations may declare markets suspension without the prior
authorization of the AESO CEO.
These requirements have been redrafted and relocated from existing ISO rules
Issued for Stakeholder Consultation: 2011-06-16
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subsection 6.9.2 and ISO OPP 201.
Subsection 9 – Declaration to Invoke State of Markets Suspension
This subsection specifies the requirements associated with declaring a state of
markets suspension.
Comment # 13: Insert Comments / Reason for Position
(if any)
The AESO must make a declaration when it deems that conditions exist that
require it to invoke markets suspension. Market participants will be informed of
the conditions and the start and estimated end date/time of the limited markets
operations situation. Depending on the situation of the electrical system, the
internet, phone services, etc., the AESO will determine on the best
communication method to issue the declaration and inform participants.
These requirements have been redrafted and relocated from existing ISO rules
subsection 6.9.3.
Subsection 10 – Effect of the State of Markets Suspension
This subsection specifies that the AESO is not required to follow the energy
market merit order, the ancillary services merit order, or the dispatch down
merit order, and that the AESO must determine the system marginal price in
accordance with subsection 11 during the period of time the state of market
suspension is in effect.
Comment # 14: Insert Comments / Reason for Position
(if any)
Under the severe situation of markets suspension, the AESO’s primary focus is
to maintain the reliability of the interconnected electric system.
Therefore, the AESO is not required to follow the energy market merit order, the
ancillary services merit order or the dispatch down service merit order, but
instead will be issuing directives to direct market participants to provide the
necessary services.
These requirements have been redrafted and relocated from existing ISO rules
subsection 6.9.1.
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Subsection 11 – System Marginal Pricing During State of Markets
Suspension
Comment # 15: Insert Comments / Reason for Position
(if any)
This subsection specifies how and when the system marginal price will be
determined under a state of markets suspension.
In order to provide a transparent price signal and a baseline compensation to
market participants, during a state of markets suspension the system marginal
price will be set at either the prior thirty day average on peak price or off peak
price, depending on the hour of the day the state of markets suspension is in
effect.
These requirements have been redrafted and relocated from existing ISO rules
subsection 6.9.4.
Subsection 12 – Operating Costs Recovery for Certain Market Participants
This subsection sets out the conditions in which market participants will be
eligible to receive compensation to cover their operating costs during a state of
markets suspension, and how these will be received.
Comment # 16: Insert Comments / Reason for Position
(if any)
In order to keep market participants whole in recovery their costs for providing
services during a markets suspension, the proposed New ISO Rules Section
202.7 allows for the recovery of operating costs if it is not sufficiently covered by
the energy receipts.
If a market participant does not recover its operating costs from the energy
receipts then the AESO must pay the shortfall.
Subsection 13 – Termination of Markets Suspension State
This subsection specifies the requirements for terminating a state of markets
suspension.
Comment # 17: Insert Comments / Reason for Position
(if any)
In order to minimize the impact from markets suspension, the AESO must
terminate markets suspension as soon as it restores ordinary course markets
operation. The AESO must issue a declaration to inform market participants of
the date and time of the termination of markets suspension.
To provide transparency of operation during a markets suspension, the AESO
must publish a preliminary report within five business days of the end of the
Issued for Stakeholder Consultation: 2011-06-16
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markets suspension and a final report within twenty (20) business days of the
end of the markets suspension, providing description of the event and
circumstances, and how the AESO managed the event.
These requirements have been redrafted and relocated from existing ISO rules
subsection 6.9.5.
(b) Removals
Comment # 18: Insert Comments / Reason for Position
(if any)
No removal of ISO rules provisions are being proposed for proposed New ISO
Rules Section 202.7.
(c) Amendment
Comment #19: Insert Comments / Reason for Position
(if any)
No amendments to ISO rules provisions are being proposed for proposed New
ISO Rules Section 202.7.
(d) Other
(Stakeholders wishing to comment on specific provisions are requested to copy
the provision into this area and provide comments)
Issued for Stakeholder Consultation: 2011-06-16
Comment # 20: Insert Comments / Reason for Position
(if any)
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