In the April 17, 2024, meeting of the Resource Adequacy Subcommittee (RASC), MISO proposed a series of design reforms for Load Modifying Resources (LMR), specifically:
For any concerns with the proposed design element or any other issues, MISO requests that the stakeholder provide supporting rationale and examples, if applicable.
MISO also encourages stakeholders to share additional comments about MISO's overall LMR reform proposal based on the reliability imperative and market efficiency drivers discussed during the April 17 RASC meeting.
MISO requests that stakeholders provide a list of different operating characteristics (e.g. time of day or temperature dependent), aggregation including number & type of end use customers (e.g. 10,000 residential customers or 50 commercial buildings) for your LMRs that MISO should consider for developing appropriate LMR accreditation rules.
The comment period is extended to May 3.
I do sympathize with the Operations group when it comes to and Emergency. I do agree that it would be beneficial to have information related to how many locations can respond in 30 minutes. I believe 2 things can resolve this though I am unaware of what it will take to implement them.
The First step, MISO needs to understand the different capabilities of the LMRs, such as re-registering LMRS with more identifying parameters. As stated in the meeting different "types" of LMRs. The Demand Response team can identify the different capabilities and create a new/updated registration form. This will allow MISO to create piles of LMRs that can be called upon at different times. If the DR team does integrate with stakeholders and identify most if not all characteristics of LMR capabilities, then the update registration can be populated.
Completing the first step would allow for the Second step; which is update the operating model to have access to the different levels of the LMRs. This way in case of an emergency an operator can identify the level of LMRs needed. Then the operations model would pick up the identified LMR and its capabilities. (This may be a slim concept but it might be a thought starter.)
As for 8 tests a year, that is CRAZY and will be unacceptable for a very large segment of the current registered LMRs. Going back to the first step, with the identification of the types of LMRs you will then be able to identify the testing capabilities and the feasibility of testing at specific times.
There may be more to come as I continue to think through the great interactive conversation today.
Alcoa Power Generating, Inc. (APGI)
Feedback on
“Accreditation Reforms for LMRs (RASC-2019-9) (20240417)”
May 01, 2024
During the April 17, 2024, Resource Adequacy Subcommittee (RASC) meeting, MISO requested feedback on their proposal to reform the accreditation process for Load Modifying Resources (LMRs).[1]
As a MISO Member, MISO Market Participant, and Load Serving Entity with LMRs registered and participating in MISO, Alcoa Power Generating Inc (APGI) has specific interests in the accreditation process for LMRs.
APGI offers the following feedback and suggestions:
APGI has been a member of MISO for many years and has participated in the MISO markets since the inception of the MISO market, providing Generation, Demand Response Resources (Type I and Type II) and Load Modifying Resources. The modeling of these resources does not fully capture the characteristics of APGI’s demand response and behind-the-meter-generation, but they have been the only mechanisms to facilitate market coordination between APGI’s facilities and MISO Operations.
After reviewing the MISO proposal for LMR accreditation reform, APGI does not support MISO’s recommended changes to LMR accreditation. The changes are onerous, would have significant impacts (and costs) on large industrial consumers like APGI, and would potentially remove these resources from MISO’s purview.
Within the MISO footprint, APGI operates a smelting facility with both load and co-generation resources. These generation resources are specifically designed to serve the APGI load and without the generation resources, the load cannot have reliable and sustained operations. The current LMR modeling and reporting requirements do not accurately represent the operations of the facility because the generation resources are always self-deployed when available to serve APGI’s load.
MISO has suggested that resources that are currently registered as LMRs should consider registering as either DRR Type I or DRR Type II resources. APGI cannot speak for all customers, but for many industrial loads, the DRR models do not accurately capture the operations of the facility and would only represent increased costs and operating activities without any benefits. There are some industrial generators that are not permitted to participate in wholesale energy markets as resources like MISO’s DRRs because the generation is designed to primarily serve their internal load.
Additionally, as currently modeled, DRR resources in MISO cannot seamlessly transition from withdrawal to injection of energy, which is a characteristic necessary to make the model usable for some industrial locations. In recent years, MISO changed the compensation mechanisms for DRR resources to eliminate make-whole payments when deployed for spinning reserves. While this has minimal impact on some consumers, other large industrial loads like APGI have significant costs during an interruption. Without a mechanism to recover those costs, providing services like spinning reserves can be very risky and result in a customer losing money in the long term while reliably providing support to the electric grid.
Another issue with potential participation in MISO markets is that there is no mechanism for load to signal energy injections into the MISO Day-Ahead markets. This has created unnecessary congestion within areas of the MISO system.
APGI would urge MISO to either meet with or survey customers to examine the details of the LMRs that are registered in MISO and seek to understand the operational characteristics of those resources so MISO can better integrate those resources into MISO operations and markets.
LMR deployments in MISO have been very rare and LMRs have performed during those occasions. There is no rationale for the increase from a maximum number of calls in a season, when MISO has never approached that number of deployments.
MISO has also proposed to create stronger penalty provisions for failure to perform, including removal from participation for three planning years after two failures to perform. This requirement is extreme and represents a misunderstanding of how some customer resources operate. This might be appropriate for a customer that is grossly misrepresenting their resources, but participants that are regularly available should be financially penalized for non-performance but continue to operate. For example, APGI has generation resources that are always operating to supply its load when the generation is available. For these generation resources to be disqualified for three years, when the site loads are dependent on the generation is absurd.
APGI appreciates the opportunity to provide feedback on this issue.
If there are any questions or comments, please feel free to reach out to:
Steve Dowell
ESS LLC, Alcoa Power Generating Inc.
(812) 853-1135
DeWayne Todd
DDT LLC
(812) 573-8052
[1] 20240417 RASC Item 05a LMR Accreditation (RASC-2019-9).pdf
Advanced Energy Management Alliance
MISO Resource Adequacy Sub-Committee (RASC)
“Accreditation Reforms for LMRs (RASC-2019-9) (20240417)”
May 01, 2024
Advanced Energy Management Alliance (“AEMA”) [1] respectfully submits the following comments to the MISO Resource Adequacy Sub-Committee (“RASC”) on the feedback request made by MISO at the April 17, 2024, meeting of the RASC.[2] AEMA is a trade association under Section 501(c)(6) of the Federal tax code whose members include national distributed energy resource companies and advanced energy management service and technology providers, including demand response (“DR”) providers, as well as some of the nation’s largest demand response and distributed energy resources. AEMA members support the beneficial incorporation of distributed energy resources (“DER” or “DERs”), including advanced energy management solutions, into wholesale markets as a means to achieving electricity cost savings for consumers, contributing to system reliability, and ensuring balanced price formation. These comments represent the collective consensus of AEMA as an organization, although they do not necessarily represent the individual positions of the full diversity of AEMA member companies.
At the April 17th meeting of the RASC, MISO presented their proposal for accreditation reforms for Load Modifying Resources (LMRs). Broadly speaking, AEMA does not support the proposed changes to LMR requirements because the proposal creates significant barriers to participation in the form of shortened notification times, unlimited activations, and increased testing requirements. These expanded accreditation requirements create significant uncertainty for potential market participants without reciprocal opportunities to capture the costs of these obligations. Instead of giving MISO Operations additional access to these resources, the proposed changes will potentially remove resources from MISO’s operational control. For these reasons, AEMA encourages MISO to examine other options for any changes to LMR participation requirements including, but not limited to, additional modeling options and improvements to the existing participation models.
LMRs are generally composed of behind-the-meter-generation (BTMG) and demand response (DR) resources. Consumers who opt to respond to system emergencies are a critical element in reliable grid operations and have supported grid reliability for decades. The proposed changes by MISO would significantly impact how those resources support grid operations and potentially leave MISO without the ability to call on these resources in a planned manner.
For many large industrial consumers, there is a willingness to interrupt production during a system emergency because the option of a controlled interruption is preferable to an uncontrolled system load shedding. MISO should examine opportunities to integrate these resources into emergency procedures and potentially expand the options for participation rather than increasing the requirements for existing models.
AEMA urges MISO to conduct a broad survey of the types of resources that are currently registered as LMRs and develop a deeper understanding of the categories, classifications, and capabilities of these resources. MISO should seek to understand why the resources that are currently registered as LMRs have opted not to register as EDRs or DRRs. What are the specific roadblocks for consumers? Could a non-emergency LMR participation model give MISO operations better access to needed resources?
MISO should also examine why consumers are not willing to utilize the existing DRR participation models. In some instances, DRRs are subject to uncertain compensation and risk. For example, MISO eliminated make-whole payments for resources deployed for Spinning Reserves which has had an impact on the willingness of some consumers to offer these services even though they have the capability of reliably providing these services. The impact of customer interruptions can be very significant. MISO’s current investigation into the Value of Lost Load (VOLL) conservatively places the cost at $10,000/MW. AEMA examined this issue in their Grid Resilience White Paper and observed that customers considering DR participation must also contemplate the impacts of interruption commitments on their business planning cycles, the requirements of pre-event operational procedures, the impacts on production and employees during an event, and the timing and cost of post-event recovery.[3]
MISO has requested feedback on specific aspects of the proposed LMR accreditation reforms. AEMA offers the following comments:
Most significantly, however, is MISO’s proposal to require two random tests of LMRs for each planning season. A total of 8 random tests per year. There is no rationale for this type of testing requirement. No other resource in MISO testing requirements this stringent. MISO already requires annual testing and has significant penalties for failure to perform that are far above the potential revenues that resources can earn based upon the results of recent capacity auctions.
MISO has proposed to increase penalty provisions for failure to perform to the level of full disqualification from 3 Planning Years for any 2nd Event failure to perform. This set of requirements is not just and reasonable, particularly as MISO considers increasing the number of deployments for LMRs. For comparison, no market resource in MISO that fails to perform multiple times in the Real-Time Market has such an onerous consequence. As the market rules that currently are, the performance penalties for failure to perform are much more onerous than those of other market resources that fail to perform in the Real-Time market.
AEMA has previously expressed concerns about other limitations with the current DRR market design. These include the minimum participation size of 1 MW for DRRs and the modeling restrictions that prevent resources from seamlessly transitioning from withdrawal to injection. MISO’s DRR participation models are general mechanisms for demand response participation, but these models are not optimized for demand response specifically. Enhancing the characteristics of the DRR participation models could potentially entice more customers to utilize these market participation models.
Resources with longer notification times can still provide value to MISO operations. MISO should explore accessing or starting these resources during pre-emergency conditions as a way of gaining access to them. For some customers that can receive advanced notification and associated payments for interruption of load, those customers may be willing to make themselves available earlier in the notification process.
Additionally, MISO has not demonstrated the need for unlimited access to LMRs. There is no historic situation where the current limit on activations has been reached. In fact, the utilization of LMRs has been very limited. There is no rational justification for the expanded requirements.
Finally, AEMA is concerned that the MISO proposal of April 17, 2024, is radically different from the preliminary proposal made at the November 8, 2023, meeting of the RASC. The new proposal does not reflect feedback from stakeholders, and it is unclear what is driving these changes. MISO has failed to give an adequate rationale for the changes to notification times, obligations to respond, new testing requirements, and expanded penalty provisions.
AEMA appreciates MISO’s consideration of these comments as part of the examination of resource accreditation issues within MISO. We welcome any questions, and encourage you to contact either Katherine Hamilton, Executive Director of AEMA, or DeWayne Todd, representative of AEMA, should you wish to discuss this with AEMA members.
Respectfully Submitted,
Katherine Hamilton
Executive Director, Advanced Energy Management Alliance
Katherine@aem-alliance.org
202-524-8832
or
DeWayne Todd
DDT LLC
dewaynetodd1297@gmail.com
812-573-8052
[1] For additional information, see AEMA website: http://aem-alliance.org
[2] 20240417 RASC Item 05a LMR Accreditation (RASC-2019-9).pdf
Overall Perspectives
Michigan Public Power Agency (“MPPA”) is a municipal power Joint Action Agency with membership consisting of 18 municipal electric utilities in MISO (and 4 in PJM), and MPPA fully supports the objectives in MISO’s Reliability Imperative. However, MPPA’s view on the methods to achieve those objectives can diverge from MISO’s—as is the case with MISO’s current Load Modifying Resource (LMR) accreditation proposal. MISO’s proposal will have the deleterious effects of reducing reliability and raising costs by pushing legitimate LMR capacity into retirement/non-participation and thereby forcing Market Participants (MPs) to replace this capacity at a time when planning reserves are declining and building new capacity resources is difficult as well as costly.
MPPA would like to caution against unrealistic reliability expectations, ignored interactions between separate solution proposals, and blunt instruments in pursuing the Reliability Imperative:
MISO’s Demand Response Resource (DRR) market participation model
Given that most, if not all, of MPPA’s Members’ Behind the Meter Generation (BTMG) LMR would have great difficulty meeting a 30-minute notification time requirement, and the Emergency Demand Response (EDR) registration does not qualify for capacity, these resources’ alternative registration would be as DRR.
MISO’s DRR Tariff participation architecture, systems and settlements are clumsy, outdated, and ineffective at onboarding behind the meter capacity resources. The Demand Response Tool (DRT) needs a replacement or complete overhaul since the associated business processes are mostly manual. For example, DRT-driven settlement of the LMR deployment on Operating Day (OD) 12/23/22, including corrected distribution of credits, did not occur until 7/12/23—201 days later. The complexity of DRR settlement rules, including use of Net Benefit Price Threshold (NBPT), erodes confidence in settlement calculations and can prevent their replicability by MPs.
The DRR participation architecture allows for BTMG LMR to change registration and obtain capacity credit without providing shorter response time to MISO operators in the Real Time (RT) market. To access the DRR, MISO would have to commit it uneconomically in the Day Ahead (DA) market—please explain how this is preferable to using a Capacity Advisory to issue an LMR scheduling instruction up to 24 hours before the potential forecasted emergency condition.
FERC filing submittal date
Given PY’28’29 implementation, the Q3’24 FERC filing submittal date should be a goal rather than a rigid requirement. More importantly, the filed proposal should reflect an organized and thoughtful review of LMR accreditation and how it fits within the Reliability Imperative among MISO and its stakeholders, including modifications to MISO’s proposal if and where necessary.
Notification Time
The operating characteristics of some BTMG dictate longer than 30 minutes to be synchronized and at full dispatch, so they would be physically unable to comply with a 30-minute notification time.
Proposed audit, testing and penalty provisions
The approach for municipal thermal BTMG should still be GVTC with seasonal temperature/humidity adjustment. MPPA is unclear for which ODs’ meter data would be required—should only be ODs of test or deployment. Random testing ≥ 2x/season is an onerous and costly requirement. Finally, the proposed penalty provisions are draconian especially considering the stringent, availability-based LMR accreditation proposal expected from MISO at the May RASC.
Wabash Valley Power Alliance (“WVPA”) appreciates the opportunity to comment on the Accreditation Reforms for Load Modifying Resources (LMRs) and supports MISO’s effort to improve the reliability of LMR resources and identify resources that have cleared in the planning resource auction but are not available in real-time when called upon. WVPA believes there are ways to accomplish these goals and retain the value of legacy LMRs.
Background
WVPA provides an overview of our Demand Response (DR) LMR resource landscape to illustrate the need for flexibility in an LMR accreditation approach. The owners of these resources do not primarily do business in the energy industry. Participation reduces their costs in exchange for an occasional partial service interruption. Approximately 1/3 of our DR LMRs registered for summer are Commercial and Industrial (C&I) voluntary interruption contracts. The other 2/3 of our DR LMRs are device-based and would need to be scheduled for reduction. Due to the diversity of resources, a one size fits all approach as MISO has proposed will lead to a reduction in total registered LMR resources. We detail specific concerns below, in response to each individual element of the MISO proposal.
Notification time
WVPA recognizes the implications of LMRs not responding in emergency situations. MISO does not call upon these resources until there is an EEA 2. At that point time is of the essence and the resources must be available. WVPA recommends that MISO implement the proposed 30-minute timing to align with reliability needs but also retain a 120-minute option, so there are two tiers for LMR registration. The 30-minute option may resemble short-term reserves, as an LMR-STR.
During the April 17, 2024, Resource Adequacy Subcommittee (RASC) Meeting, MISO proposed that entities that cannot meet the 30 minutes should instead register as Demand Response Resources (DRRs). DRR registration is not suitable for all resources and may drive some resources out of the market, a consequence that, during that same RASC meeting, MISO noted is not the intent of the proposal. With two registration options, 30-minute resources can come on-line to respond to the immediate need, and a second wave of resources could come online at the 120-minute mark to support stabilization or relieve those initial resources. Alternatively, MISO may adjust its business practices and call upon the 120-minute LMRs during an EEA-1, capacity advisory stage.
This approach would accommodate retention of many more resources that might otherwise leave the market. Entities may not be able to meet 30 minutes, primarily because of economic and safety constraints for C&I LMRs and the timing involved in notifying staff controlling aggregated device-based resources. LMR programs require manual intervention on the part of our electric distribution cooperative members to schedule device control software tools. In addition, C&I participants require time to curtail loads to prevent equipment damage. Offering 30 minute and 120-minute options will provide sufficient time for many resources to receive the notification and act.
Locational Information
WVPA supports summing LMR kW volumes to the EP Node level for operator displays, however providing the physical address is not practical for device-based aggregations, as they number in the tens of thousands in our footprint. Furthermore, WVPA would like MISO to describe how it will protect sensitive address information for contract-based resources from inadvertent disclosure.
Number of Calls
The current requirements put some restrictions on the number of times MISO may direct a resource to respond, by season. Understandably, as operational uncertainty and complexity increases, LMR resources may need to be activated more frequently and as a result this original cap may no longer be feasible. Still, having no exceptions to the requirement to respond to all emergencies without incurring penalties will undoubtedly lead resources to leave the market. That degree of uncertainty for current and future LMR customers, may limit participation.
Audit, Testing and Penalty Provisions
WVPA supports auditing meter data submitted through the Demand Side Resource Interface (DSRI) tool. We also support testing the resources as the single best way to identify poor performing LMRs, however, care must be taken to prevent overburdening all resources in the process. Requiring more stringent testing of these resources than is required of an electric generator is unjust, unreasonable, and will ultimately lead these LMRs to exit the market, which will result in further tightening of the already tight resource capacity in MISO.
If MISO instead conducts a targeted seasonal testing program to ensure that every resource is tested, but not repeatedly, this may be acceptable. Providing a certain amount of notice would facilitate the testing process for C&I resources. As an example, PJM currently identifies a specific week for random testing of demand response resources.
As a final point, penalty provisions must provide a sufficient deterrent to non-performers. The proposed penalties appear reasonable, except for, disqualification from the next three planning resource auctions for the second event performance failure in a season. A two-year disqualification would be a sufficient deterrent for any legitimate resource. WVPA would expect non-legitimate resource to swiftly leave the market to avoid FERC action after the first occurrence.
Conclusion
WVPA encourages MISO to adopt a two-tier LMR structure to retain the value of LMR resources and believes that regular targeted testing is the best way to ensure that registered resources are legitimate. WVPA requests that MISO reconsider its approach regarding inputting the physical address of each individual resource, having no exception to the requirement to respond to each event, and the three-year disqualification penalty for the PRAs after the second event of non-performance.
Notification time
Illinois Commerce Commission (ICC) staff generally supports proposed reforms to accreditation for Load Modifying Resources (LMR) to ensure LMR availability and reliability in emergency conditions. The increased reliability in response to a changing generation fleet generally align with Illinois’ policy mandates, and the ICC hopes that MISO’s plan to shorten the notification time will result in LMR availability that better matches the LMR capacity cleared in the PRA. However, ICC staff also notices that registered LMRs with a thirty-minute notification time comprise only 8% of the total LMR capacity (913 MW). ICC staff is uncertain that this decrease in capacity (assuming no MPs register new LMRS or shorten existing LMR notification times) will adequately assure reliability. ICC staff anticipates that additional testing and penalties will increase LMR availability of the current capacity with thirty-minute notification times.
Proposed audit, testing and penalty provisions
The deficit of real-time LMR capacity compared to the cleared capacity at the PRA necessitates new mechanisms to ensure LMR availability in emergency situations. Since MISO will require LMR response through all seasons, ICC staff recognizes MISO’s need to test LMRs through all four seasons. However, increasing testing to eight times a year may result in market participants incurring prohibitive costs and deter LMR registration. ICC staff generally supports more rigorous testing to ensure LMR performance, but do not want that testing to significantly deter LMR participation.
While DRR reforms are also being considered at the Market Subcommittee, ICC staff generally supports LMR reforms. ICC staff understand that with increased requirements for LMRs, some market participants may register resources as Emergency Demand Response (EDR) which do not have mandated participation and are compensated through LMPs instead of the capacity market. EDRs are already monitored for load reductions in accordance with Schedule 30 and must submit metered data. If LMRs are required to respond in emergencies, ICC staff generally supports the proposal that all LMRs must submit metered data. This requirement will likely ensure both reliability and establish consistency along all DR resources for reporting.
Rainbow Energy Center (“REC”) appreciates the opportunity to comment on MISO’s Load Modifying Resource (“LMR”) design reforms that were discussed at the Resource Adequacy Subcommittee on April 17, 2024. REC believes that LMR policy reforms are necessary as a piece of market design to help ensure reliability during capacity emergencies as MISO continues to see dispatchable generation retire and be replaced by intermittent resources that are weather dependent. The 2024/25 PRA cleared more than 12,000 ZRCs from LMRs to meet MISO’s summer reserve margin. These resources must be available to MISO in emergency situations, just like generation capacity resources. Accordingly, REC offers the following comments in support.
REC agrees with MISO’s proposal to reduce notification requirements from six (6) hours or less to thirty (30) minutes or less for LMRs. This will allow LMRs to function as a fast response resource that can be called on by MISO to maintain reliability during capacity emergencies and allow for LMRs to complement MISO’s current reserve product offerings. REC agrees with MISO that these resources need to be able to perform quickly when system conditions rapidly change and appreciates the operational challenges MISO is trying to address. The 30-minute notification period will also support other MISO initiatives that are geared towards improving system reliability, like MISO’s System Attributes proposal with respect to flexibility. Specifically, fast response LMRs will improve the ability of MISO’s resource fleet to adjust electric consumption in response to changing system conditions. Redefining performance criteria for LMRs will send focused signals to Market Participants that identify flexibility needs and help expand the fleet of resources that can provide flexibility. This aligns with MISO’s approach to addressing flexibility in the System Attributes Roadmap and will create an environment for resources to meet the increasingly variable and uncertain real-time operational needs of the system. 
REC disagrees with stakeholder concern that the thirty-minute notification timing will result in lost capacity since many LMRs will be unable to comply with MISO instructions. MISO repeatedly emphasized that it is open to finding alternative paths that would give longer lead LMRs the opportunity to participate in the market before emergency conditions exist. REC supports finding alternatives for LMRs with greater than thirty-minute notification times and demonstrated capability. MISO and stakeholders can find additional avenues for long lead time LMRs to participate in a way that does not jeopardize resource adequacy and system reliability.
REC supports MISO’s proposed reforms for audit, testing, and penalty provisions. The current LMR construct is inadequate and does not prevent Market Participants from offering more capacity in the PRA than can be converted to real-time energy reductions. The sale of LMR capacity that does not or cannot convert those capacity commitments into real-time energy capacity creates significant reliability risks. MISO’s historical data shows that LRM availability is significantly less than cleared LMR capacity in the PRA at all times since Planning Year 2020-2021. These cleared LMRs – which receive capacity payments – often serve as a last resort to prevent load shed during Emergency Events. Requiring Market Participants to submit LMR meter data, submit to audit requirements that validate submitted data, undergo random testing, and MISO’s proposed penalty revisions will serve as a comprehensive package to ensure that LMRs are available when needed. Finally, with respect to the frequency of testing concerns, REC notes that Market Participants can include cost of testing in their capacity market offers during the PRA to hedge against future losses from random tests that will occur each season. In the event those testing costs exceed 10% of the Zonal CONE value, MISO should consider adjusting the offer rules to permit such reasonable cost recovery. This will offer Market Participants adequate protection while considering the reliability needs of the system.
Additionally, REC is concerned with double counting of LMRs, which may also lead to the difference MISO is seeing between cleared and available LMRs. One potential issue leading to this difference is the use of LMRs that are included in coincident peak load forecasts and then offering into and clearing in the PRA. This strategy can allow for LSEs to report coincident peak load values net of LMR contributions and then turn and sell LMR capability into the PRA. The same MW of capability would be used to (1) reduce demand and (2) reduce capacity procurement. This endangers reliability. REC supports development and use of a “Locational Enrollment Tool” that can be used during the LMR enrollment process. Such a tool would give MISO additional information on specific LMRs, including demand reduction volume and physical address, which could allow MISO to address this issue, and better respond to real time emergency scenarios and manage congestion.
Overall, REC believes that a Locational Enrollment Tool, and audit, testing, and penalty reforms are consistent with and further the objectives of Order 745 and Order 719. These reforms will ensure that demand response is compensated only where a demand response resource can balance supply and demand as an alternative to generation and overall ensure comparable treatment of demand response with other resources.
Thank you for your consideration.
The Environmental Sector appreciates the opportunity to submit the below feedback concerning MISO’s proposed Load Modifying Resource (LMR) reforms, as presented at the April 17, 2024 RASC. Acknowledging that the Environmental Sector is not a market participant, and thus does not operate LMRs, our comments are thus limited to the broader effects that MISO’s proposed reforms may create.
The Environmental Sector views LMRs and other forms of demand response as being critical pieces in the grid of the future, in both the near and long term. As such, our biggest concern with MISO’s proposed LMR reforms is that they would limit participation of currently existing LMRs, or would otherwise discourage future participation by LMRs or other demand-side resources that can assist MISO in maintaining system reliability.
MISO is embarking upon a variety of changes with respect to demand-side resources (LMRs, DRs, etc.) at the RASC, MSC, DERTF, and possibly elsewhere. As such, it is time to step back and take a broader look at MISO’s programs for these resources as a whole. Considering the growing importance of these types of resources and their quickly evolving technological capabilities, MISO should expand its effort now to explore how all demand-side resources can provide reliability benefits as the electricity sector transitions in the coming decades. MISO’s proposed changes to LMRs are not expected to be implemented until the 2028-2029 planning year, thus, there is time to consider how all of its programs for demand-side resources can be adjusted together in order to ensure the greatest and most effective participation of these resources in the market. This kind of holistic reform effort is also likely to gain greater support from stakeholders, especially those that represent LMRs.
30 Minute Notification Time
We appreciate that MISO’s control room operators need real-time assurance that is measured in minutes instead of hours. But, without thinking more broadly about the possible use-cases for LMRs with a response time greater than 30 minutes, MISO is likely letting a useful reliability asset slip away. Telling LMRs with a response time greater than 30 minutes to register as a DRR Type-I, DRR Type-II, EDR, or (in 2029) DER ignores the fact that those LMRs chose to register as such in the first place, and it risks those resources leaving the market when the alternatives do not make business sense. As noted above, changes to DRR Type-I, DRR Type-II, and EDR should be considered in conjunction with MISO’s proposed LMR reforms to ensure, at least in part, that any LMRs that cannot meet a 30 minute notification obligation nonetheless have other workable avenues to serve the MISO system.
Obligation to Respond
Without regard to penalty provisions (discussed in the next section), requiring LMRs to respond to each MISO scheduling instruction, without the limits on number of calls currently in place, appears reasonable on its face.
Audit, Testing, and Penalties
While the Environmental Sector appreciates the need for MISO to ensure that LMRs are capable of responding each and every time when called, based on our current understanding we believe that the current auditing, testing, and penalty provisions are far too burdensome. We ask that MISO provide some clarification on what is required of an LMR to pass a random test:
This last question is particularly important as a random test without the context of a MaxGen event and its associated notifications could fail to provide the LMR owner sufficient notice that it may be called upon in the near future, and would thus fail to “test” the real-world dispatch of LMRs..
With regard to penalties, we agree that there should be consequences for failure to perform when called, but what MISO has proposed appears extreme and does not seem to represent comparable treatment with other MISO capacity resources. For example, a generator that has been given capacity credit does not have all of its capacity revoked if it has a forced outage once in a season. If it fails to perform twice in a season, it is not disqualified from participating in the PRA for three years, or disqualified altogether. Instead, generators have reduced accreditation values going forward. We urge MISO to reconsider the penalties for LMRs so that they will be more inline with the consequences faced by other resources.
Other Feedback
We also urge MISO to reconsider its compensation structure for LMRs, which appears to lack the right incentive for these resources to show up when they are needed. MISO should consider compensating LMRs for capacity when they actually show up, not just paying them for capacity offered in the PRA. While not the only approach, one example could be for MISO to set a value for capacity compensation over the year, but only pay the LMR a portion up front and then pay them more as they are available–first paying them when they show up during testing, and then paying them additional compensation when they show up when called upon during an emergency. There should be additional incentive or compensation for each time these resources perform to push them to be available when needed.
TO: | MISO RESOURCE ADEQUACY SUBCOMMITTEE |
FROM: | THE ENTERGY OPERATING COMPANIES |
SUBJECT: | MARKET REDEFINITION ACCREDITATION REFORMS – LMR |
DATE: | ​​MAY 3, 2024​ |
The Entergy Operating Companies ("EOCs”) appreciate the opportunity to provide feedback on MISO’s Market Redefinition Accreditation reforms for LMRs.
Load Modifying Resources (LMRs) play a critical role in the Midcontinent Independent System Operator (MISO) market by providing essential relief during emergencies.
Understanding the total megawatts (MW) in the system and the typical profile of LMR participants provides crucial insights into the current market dynamics. We believe it is imperative for MISO to understand beyond an operational perspective these 2 aspects of the proposed Market Redefinition Accreditation reform. The majority of LMRs in our system are large industrial customers that provide needed MWs by changing their business processes during emergency events and this unique resource group creates value for all of our customers
Enhancements in tools for improved visibility, locational information, and communication with Market Participants (MPs) are necessary. Moreover, accrediting LMRs based on their availability during tight capacity hours and ensuring a better understanding of LMR rules among market participants and MISO are also key considerations.
MISO should consider offering a new market product for Resources for Demand Response.
During the January 17, 2023, RASC meeting, MISO unveiled its proposal for Market Redefinition: Accreditation Reforms for Load Modifying Resources (LMRs), categorizing them into Emergency and Non-Emergency groups. The EOCs suggest that MISO should consider this proposal along with the proposed design element changes, since changing the existing LMR product will result in the majority potentially up to 90% of LMR MWs that will no longer be able to qualify or participate.
MISO is in pursuit of a refined product endowed with specific attributes: stringent audit and testing protocols, a 30-minute notification window, and unrestricted dispatches of LMRs during emergencies. In response, the EOCs advocate for the introduction of a new product type tailored precisely to these requisites. This envisaged product aims to facilitate testing regimes, ensure swift 30-minute notifications, and diversify revenue streams encompassing capacity, energy, and 30-minute reserves, potentially amplifying total MW participation within the MISO system.
We appreciate MISO's clarification regarding the new market design notification timeline for accreditation changes.
The information presented at the last RASC meeting on April 17th informed stakeholders that the new 30-minute notification timeframe aims to better align market requirements with system reliability needs. However, as highlighted in our recent feedback, condensing the timeline for accreditation changes poses a significant challenge for EOCs, our customers and state regulators.
For the EOCs these changes will necessitate adjustments to our retail tariffs, internal software, as well as making enhancements to our LMR Notification Process, all of which will require considerable time and resources. In addition, should the proposed 30-minute notification design be implemented, MISO must significantly improve the DSRI application used for issuing LMR scheduling instructions, as the current process is overly cumbersome for market participants.
The EOCs also suggest that there should be consideration and guidelines regarding the number of times MISO communicates with our customers in these emergency conditions. The EOCs do not support the expanded and unbounded auditing and testing of these resources in the proposed design. MISO needs to understand the impact to all LMRs, especially industrial customers regarding the number of these tests and the overall impact to their daily operations. Random testing of facilities will cost these participants significant revenue and for many is a “deal breaker” to have to accommodate a large number of surprise audits in addition to being called on during emergency events. We strongly urge MISO to reassess the frequency and scope of the program and find a more balanced approach to ensure compliance without unduly burdening market participants, such as pre-scheduled or limited testing of these LMR resources.
MISO should consider the Economic and Business development of the existing demand response program and what these changes will do to the market.
At the April 17th RASC meeting, MISO requested stakeholders to provide examples of the potential impact that the Market Redefinition Accreditation reforms would have on a typical industrial load. We are providing examples for a typical Industrial Customer with Aggregated Tariff Options and a large industrial load customer operating under a Special Rate Option.
Most of our LMR customers are continuous production facilities, as opposed to unit production/assembly line facilities. They cannot be shut down quickly without risking damage to any work in progress in addition to potentially creating safety hazards. Most of these industrial customers are significant electricity consumers and currently serve as a valuable tool for MISO to address potential emergency events with the existing LMR notification timelines.
For example, they may be called upon in the early morning of an extremely hot day to help mitigate afternoon peak demands when generation shortfalls are expected.
Furthermore, these facilities primarily engage in commodity production, where the cost of production heavily influences product competitiveness. Energy usage can represent a substantial portion of their overall costs, ranging from 20% to 40% for industries like steel mills or chemical plants. Therefore, their utility bills play a crucial factor in determining the overall competitiveness of their end products.
These facilities typically operate under interruptible tariffs, which offer discounted electric rates in exchange for the ability to interrupt service for a specific number of times annually during emergencies or economic needs. If these facilities no longer qualify for interruptible status, they will be unable to remain on these tariffs, resulting in increased electric costs and a lengthy contract amendment process. In many cases, the availability of these lower rates has influenced companies' decisions to locate and/or expand their facilities within our region. Increases in these agreed upon rate tariffs creates a difficult conversation at minimum and a potential facility relocation or shuttering at worst. This shift to a higher cost tariff will factor in when these companies are evaluating an expansion project at their current location or when new evaluating locations for new potential facilities in the future. These companies may even consider relocating to other regions with lower utility costs, potentially outside of MISO's jurisdiction.
We believe that MISO needs to fully understand the significance of current Industrial Customer Utility Tariffs with Interruptible Service options. Our customer tariffs allow interruptible customers to sign up for a firm load amount and an amount of interruptible service for a discount to be interruptible for certain number of times in a planning year per the tariff. The Utility provides a discount to register these customers as an LMR for the capacity benefit they provide that ultimately benefits other residential and non-residential customers by having the potential capacity and providing it as a demand response resource when it is needed the most. Any change to existing LMR requirements will also require regulatory filing seek approval for meeting these requirements.
The new 30-minute notification process makes it very challenging to get the required notification & approval from existing LMR customers. In addition, managing this end-to-end communication from an operational perspective ensuring both all aggregated customers in and interruptible customers are available and able to provide the registered MWs within the 30-minute notification period for an aggerate of many customers. Our current interruptible tariffs would not allow for a must offer on a daily basis for energy. The random testing would cause undo economic impact to customers production and can be accomplished the same goal to affirm the ability of a LMR participant to reduce their load by either pre-scheduled testing or by providing certified results of load reduction by the LMR and certified by the TO acting as a market participant. Furthermore, the Large Industrial customer that serves as an LMR with special rate contracts. Utilities have large industrial accounts that serve as LMRs, these large industrial customers receive a discount through their special rate contract to be interruptible for load above firm with the requirement to be a capacity benefit for all of utility customers. Changing the LMR requirements with the proposed MISO Market Redefinition Accreditation reforms changes the Return on investment that these discounts provide reducing the incentive for the business to remain in the program. Ultimately this will hamper the utility's ability to bring new industrial loads to the respective utility’s state and specifically within their territory. MISO needs to understand that newly proposed industrial projects are highly sensitive to utility rates and by increasing the requirements for the LMR program impact the ability of a utility to offer these interruptible rates going forward. Large Industrial customers provide much needed economic growth for regional economies not only for job creation, but they also provide large capital investments which effect tax revenues, indirect benefits to other local companies, spur residential & commercial growth.
In conclusion, the EOCs strongly urge and advise MISO to meticulously consider the economic and business development aspects. Changes in retail customer rates and contracts, particularly regarding Interruptible Rates, could yield significant implications. The potential loss of new industrial customers to regions offering more favorable LMR incentives, coupled with the competitive disadvantage posed by regions with less restrictive Interruptible Tariff (I.T.) rates, underscores the critical nature of this consideration. The EOCs believe that the proposed modifications to the existing demand response program in the MISO market should prioritize optimizing the effectiveness of Load Management Resources (LMRs) during emergencies, while simultaneously fostering economic growth and competitiveness. Thus, careful consideration of economic impacts is paramount to ensuring the success of these initiatives.
MidAmerican Energy appreciates the opportunity to provide feedback on Accreditation Reforms for LMRs (RASC-2019-9) (20240417).
MidAmerican understands the increasing operational challenges that MISO faces given the addition of significant amounts of intermittent resources, lower system reserves and changing weather patterns. However, MidAmerican has serious concerns that any potential benefit in terms of implementing a 30-minute notification time would be significantly outweighed by excluding many generation and load modifying resources that MISO can utilize to respond to system conditions to maintain reliable operations.
MISO should provide analysis showing how changing the LMR notification time to 30 minutes will impact the overall system. LMRs have been used for decades to help manage reliability concerns. Does MISO have any studies that show reliable operations if these resources are no longer available? If not, MISO needs to clearly demonstrate that there are no reliability impacts if half of the LMRs no longer participate due to the 30-minute notification change. What if MISO loses 75% of the LMRs due to the onerous two-times per season testing requirements? It would be hasty to make the change to effectively eliminate many LMRs without fully understanding the impacts.
MISO seems to assume that if the current set of LMRs can’t respond in 30 minutes they will simply become Demand Response Resources (“DRRs”). For MidAmerican, transitioning an LMR to a DRR is not allowed in the current retail regulatory structure. MidAmerican will work with its regulators and program participants to implement necessary retail tariff changes, but there is no assurance that MidAmerican’s large industrial customers who currently participate as LMRs will participate in the wholesale market as DRRs, thereby excluding valuable resources from the market. MidAmerican has been using energy efficiency programs including LMRs for decades to delay the building of generation resources. MidAmerican is concerned that by making this one change, MidAmerican may be required to build generation that would otherwise not be needed under the rules today. While MISO may be indifferent to that outcome, MidAmerican is concerned that such an outcome will have negative impacts on MidAmerican’s retail rate payers.
MISO is inappropriately placing the entire burden for notification times on load serving entities which is not just and reasonable. MISO must share the burden by committing to improve its look-ahead forecast capabilities such that a 30-minute notification period does not become an issue in the first place. Further MISO has not demonstrated the 30-minute notification time is consistent with how other resources are treated in the look-ahead process. How does MISO know that 30 minutes is the correct notification time? Has MISO done any analysis that indicated when MISO should truly set the go/no go criteria? MISO seems to be assuming that their forecasts don’t improve over time which doesn’t seem reasonable and does not meet the expectations of most of MISO market participants. Investments in better forecasting for both supply and demand should allow for better increased operational certainty. While MISO indicated that it has been ostracized for issuing an EEA2 when, with the benefit of hindsight, they didn’t need to go to that step, MidAmerican believes it is more prudent to have LMRs deployed as a precautionary step as opposed to regretting they were not deployed.
MidAmerican would also like to point out that PJM’s notification time is not at all consistent with 30 minutes as alluded to by MISO in its presentation. Per section 4.3.1 of PJM Manual 18, load management must be able to be implemented within two hours of notification to the resource provider of a PJM-initiated load management event. Load management is required to fully respond within 30 minutes of notification unless an exception request for 60 or 120 minutes notification time is approved by PJM. Some of the exceptions include extra time for a manufacturing process to reduce in a manner that doesn’t damage equipment and extra time for behind-the-meter generation that has time-intensive manual processes. MidAmerican urges MISO to include similar exceptions.
MidAmerican does not have an issue with providing physical addresses for BTMG and Shed/Shift customers; however, MidAmerican cannot support a requirement to provide individual locational information for 65,000 residential customers participating in programs like air conditioning control. We propose that MISO allow residential customer locational information be provided as a percentage by county.
MISO emergencies are infrequent events. Does MISO have any information and studies that demonstrate the expected frequency of emergences that would warrant a requirement for unlimited calls? MidAmerican requests that MISO reconsider the unlimited number of calls requirement. Including such a requirement will severely limit the number of LMRs available to MISO. MISO should consider giving partial credit for LMRs without the ability or desire to provide unlimited calls to MISO.
Requiring customers to perform two random tests per season (eight tests per year) is unacceptable. This requirement will adversely affect participation as industrial customers will potentially be losing production time during the test, which imposes significant costs. If this requirement is no longer applicable if a resource changes its registration requirement to DRR Type I, then that alone illustrates the unreasonableness of this requirement.
The changes MISO proposes make it cost-prohibitive for customers to participate in LMR programs. Having to decrease their load in 30-minutes, requiring additional testing and removing the number of times they are obligated to respond is an extreme change to current requirements.
These proposed changes will likely have the effect of drastically reducing MidAmerican’s current LMR participation which would essentially require the construction of generation assets. This is not an acceptable outcome for MidAmerican. Also, the proposal to implement the LMR changes in 4 years is not reasonable because building new generation simply cannot be accomplished in that time frame.
MidAmerican is deeply concerned that MISO is being overzealous in trying to make their market “perfect” based on a premise that changing scarcity pricing will solve everything without regards to state regulatory realities. MISO needs to understand that regulated utilities must balance affordability, reliability, and sustainability for their customers.
MISO requests that stakeholders provide a list of different operating characteristics (e.g. time of day or temperature dependent), aggregation including number & type of end use customers (e.g. 10,000 residential customers or 50 commercial buildings) for your LMRs that MISO should consider for developing appropriate LMR accreditation rules.
WEC Energy Group Feedback – Accreditation Reforms for LMRs
WEC Energy Group provides this feedback on MISO’s proposed accreditation reforms for LMRs as presented at the April 17, 2024 meeting of the Resource Adequacy Subcommittee (RASC). We appreciate the LMR operational concerns raised by MISO and provide these comments to move discussion forward to achieve an acceptable resolution.
More Investigation Needed Before Declaring a Problem with LMR Availability:
WEC Energy Group is not convinced there is an inherent problem with the availability of LMRs, as depicted on slide #6 of the presentation. The apparent gap between LMR capacity cleared in the PRA and the real-time availability reported within the DSRI tool requires a more comprehensive investigation. Slide #6 does not take into consideration that LMR Demand Response (LMR-DR) consists of two components, the load demand and the amount of interruptible load supply. Entities report Coincident Peak Demand gross of interruptible load in the PRA. While the slide is indicating demand response is available at levels lower than what cleared in the PRA, it is not showing the corresponding actual demand of the demand response customer – when the load demand is lower, so is the amount of interruptible load supply by an equal amount. In addition, it is unclear if the data is inclusive of the gross up of transmission losses and PRM percentage.
As we have noted in previous written comments, conversations with MISO staff, and RASC meetings, an interruptible customer with a firm service level does not necessarily have a 100% load factor. This means that the customer’s total load will vary throughout the year and therefore the amount of load that is available to curtail will vary. An example that we have cited on numerous occasions is a 100 MW industrial customer with a 20 MW firm service level. As reported in the PRA, the load is 100 MW with a corresponding 80 MW LMR-DR. In real-time, this customer may only have a total load of 70 MW, not because it self-scheduled 30 MW of demand response, but because the customer is only consuming 70 MW. During this hour, the amount of LMR-DR available from this customer is 50 MW (70 MW real-time load minus 20 MW firm service level). This is a true and accurate reporting of the prevailing load level and the LMR-DR availability from this customer. Furthermore, this information is entirely consistent with the amounts of load and LMR-DR cleared in the PRA.
MISO needs to perform additional investigation before jumping to the conclusion that LMR-DR availability is only about 50% of what clears in the PRA. It could be that the actual load of each interruptible customer is much lower than that reported in the PRA. Load that is not consuming is simply not available for interruption and is not necessarily the result of a LMR-DR self-schedule. It is also interesting to note that the “Breakdown of Registered LMRs” on slide #30 shows that the total BTMG registration is approximately 4,500 MWs where the Demand Response registration is approximately 7,500 MWs. It appears the graph on slide #6 may not account for the BTMG registration and could account for most of the apparent gap.
MISO’s example of on slide #6 of “units” clearing the PRA but not offering LMR-BTMG availability requires that MISO reach out directly to the responsible Market Participant (MP) to find out what is driving the discrepancy. It could be that the MP is netting the BTMG from its reported market load and not reporting it as a self-scheduled BTMG. During those times when the BTMG is netted against load but not fully dispatched, the MP may be reporting LMR-BTMG availability, albeit at a much lower level than that cleared in the PRA because of the netting against reported load. MISO needs understand these unique situations before pursuing wholesale accreditation changes to remedy a perceived problem. It is entirely possible that the availability issue is associated with limitations of the current tools, e.g. the DSRI, rather than the asset itself.
We encourage MISO to produce 2023-2024 LMR availability against that cleared in the PRA on a seasonal basis, along with the reported demand of the LMR-DRs. The switch from an annual construct to seasonal allows MPs with interruptible customers that have varying load throughout the year to report different amounts of load and corresponding LMR in each season. This in itself may reduce the apparent gap in LMR availability versus that cleared in the PRA.
If There Is a Problem, MISO’s Proposal Does Not Address It:
MISO’s proposal to limit LMRs to a maximum response time of 30 minutes, unbound the maximum number of calls, and require eight random full-scale tests of each LMR will only result in the loss of thousands of MWs of LMR-DR. State regulatory commissions, who ultimately approve retail rate designs, are likely to have concerns over the loss of the LMR-DR capacity resource, the need for replacement capacity, and the rate impact on customers. Additionally, the proposed LMR testing requirements are not comparable to other resource types, which are not subject to multiple and random capacity tests.
In most cases, registering demand response as a DRR is not feasible, for economic and safety reasons. Customers that are on an interruptible rate and registered as LMR-DR have an expectation of curtailment during the situations prescribed by the applicable retail tariff – likely emergencies only. While each business model is different, customers are willing to curtail load during a declared emergency or other capacity situation in exchange for a lower rate. However, that value proposition is much different and likely not economically sustainable if the curtailment risk is daily. Even if the cost of curtailment is included the DRR offer, in most cases that cost of curtailment is the Value of Lost Load (VOLL). MISO will not have access to that DRR unless prevailing market prices are extremely high, which in itself is an indication of an emergency. As an aside, MISO’s Schedule 53 and proposed 53A allow resources to have a maximum start-up time of 24 hours – very different from the proposed 30 minutes for LMRs – and are only subject to non-random annual testing. MISO’s proposal will do nothing to improve access to LMRs and result in the removal of a very important tool from the operational toolbox without any sort of viable replacement.
MISO asked stakeholders for explicit examples. Consider a pulp and paper mill that is on an interruptible rate. The utility customers in this industry operate in a very competitive climate with narrow margins and are very knowledgeable about the costs of production, including electricity and the electric markets. They perform analyses comparing the expected frequency and length of curtailment, the cost to curtail production in a safe manner, and the savings associated with the interruptible rate. WEC Energy Group has worked with pulp and paper customers for decades and is confident that the addition of even a single random full-interruption test per year is enough to eliminate the benefit of the interruptible rate, let alone eight random tests per year. Participation as a DRR is not feasible, from not only an economic but also a safety perspective. Shutdown of processes in a safe manner is not a simple flip of a switch. It requires coordination across the entire production line to make curtailment of production safe. The MISO market will lose this asset as an LMR-DR , will not gain that asset back as a DRR, will drive the need for even more generation resources with the resource attributes MISO so desperately seeks, and most importantly increase costs to all customers. This is all taking place at a time when EPA regulations on the types of generation that currently supply resource attributes make those investments less attractive. In the longer-term, elimination of LMR demand response through overly burdensome requirements will cause industry to shift production to areas outside of the MISO footprint that are more cost effective and friendlier to emergency demand response.
Suggestions for LMR Improvements:
WEC Energy Group believes it is premature to declare LMRs ineffective and require dramatic accreditation changes. Rather, we would like to focus on improvements to operational tools, such as the DSRI and emergency procedures.
Once MISO is able to reach out to MPs to understand how they are reporting demand response and BTMG within the DRSI (or alternatively, not reporting it because the customer is consuming less or the BTMG is netted with load), improvements to the DSRI, along with better operator education, should enhance understanding of LMR availability. If MISO does uncover gross violations of over-reporting LMR availability that does not exist, enforcement and penalties should be assessed per the tariff rather than eliminating LMRs as a capacity resource through overly restrictive requirements.
During the April 17 RASC meeting, it was noted that MISO’s emergency operating procedures allow MISO to issue LMR scheduling instructions for a future hour during the Capacity Advisory step. In the past, we have seen Capacity Advisories issued well in advance of a potential Emergency, providing valuable time and information to LMRs. MISO stated that it has issued LMR scheduling instructions at the Capacity Advisory step only twice and that the process was “clunky”. This demonstrates that MISO can do more to formalize the advance scheduling of LMRs, remove the chunkiness, educate operators and interruptible customers, better utilize the Operational Risk Assessment (ORA) team, and improve access to LMRs in advance of an EEA level 2.
Resource Adequacy Subcommittee
Accreditation Reforms for LMRs
Dairyland Power Cooperative (“DPC”) thanks MISO for the opportunity to provide feedback on the MISO’s proposal on Accreditation Reforms for Load Modifying Resources (“LMR”) presented at the April 17th Resource Adequacy Subcommittee (“RASC”). MISO requested feedback on the proposed design elements:
Notification Time
The Respondents view MISO’s proposal to require a 30-minute or less notification time for all LMR deployments to be a major departure from the current rules surrounding LMRs and would likely force almost all of their current LMRs to no longer participate in MISO’s markets. While we recognize that MISO has seen a difference between LMR capacity that clears the PRA and what’s actually being offered on a daily basis into the Energy markets, changing the rules in such a drastic way for all LMRs in an effort to eliminate this gap is a step too far. Based on MISO’s Appendix in the presentation made at the RASC, if no LMRs change their notification time, this proposal would eliminate more than 92% of LMRs, or roughly 11GWs of capacity. This would have dire consequences on the cost to customers in the MISO region as the latest Planning Resource Auction had a 4.6GW surplus, effectively ensuring that Cost of New Entry (“CONE”) pricing if implemented today. As member-owned G&T cooperatives, the Respondents are very sensitive to the costs borne by our members and feel this proposal could have a dramatic impact on member bills without a commensurate increase in the reliability they get from being members of MISO.
Instead of changing the notification time to 30 minutes, the Respondents preference would be to allow MISO to gain access to LMRs earlier in the Emergency procedures before Step 2A as it is today without a change in the notification time structure. MISO stated at the RASC that a big issue in their eyes is that they cannot gain access to the 12GWs of LMR capacity until they are in EEA Step 2A, which we are sympathetic towards. Historically MISO has been able to forecast when they would need additional capacity further out than 30 minutes and we believe gaining access to these resources earlier in the EEA process could provide more value to MISO’s operators than the current structure and be less impactful to LMR owners who cannot respond in 30 minutes.
If MISO does move forward with changing the notification time, the Respondents propose a 2 hours or less notification time requirement would be more appropriate than the 30-minute proposal. Based on the Appendix in MISO’s presentation, a 2-hour notification time would retain approximately 55% of the current LMR fleet while giving MISO more certainty around response times if an emergency is forecast. Most of the Respondents LMR portfolio which includes industrial members, load control programs and behind-the-meter generation could respond within 2 hours and still provide MISO with the capacity it desires during emergency conditions. The Respondents believe this is an appropriate compromise and provide MISO with more certainty around availability of LMRs and still provide value to the markets in MISO.
Should MISO move forward with its presentation as proposed, the Respondents would most likely convert all behind-the-meter generation into DRR Type I assets, participate solely in the Energy market due to the burdensome metering and telemetry requirements that are required for participation in the Ancillary Services market, and change the operating characteristics of those resources with longer lead times and more restrictive operating parameters to reflect environmental limitations. Given that most of these generators operate with expensive fuel sources, the offer prices would be very high in order for them to cover their costs which would effectively make them Emergency-only resources. We don’t believe that this setup would be more beneficial to MISO than the current LMR framework today and aren’t sure this would improve MISO’s aim to improve reliability. For Load Control and Industrial members, the daily must offer requirements would almost certainly be more burdensome than any financial compensation they would receive for reducing load during infrequent emergency events. The Respondents aren’t sure if these member programs and tariffed rates would continue to participate in MISO’s market at all with the added overhead required to be a DRR in the Energy markets.
One other item that should be considered is that the 1MW requirement for DRR should be lowered if an LMR decides to change its registration. The Respondents currently have a few generators that are below the 1MW threshold which would make them ineligible to become DRRs. MISO should consider lowering this threshold to ensure that these resources aren’t prohibited from modifying their registration to still participate in the MISO markets.
Obligation to Respond
The Respondents do not take issue with having to respond to all events in which MISO needs capacity to maintain system reliability with the caveat that the tools necessary to report the availability (DSRI) should be flexible enough to account for seasonal variation in the ability to reduce load. Many of the Respondents load modifying programs include members with seasonal variation such as A/C units and irrigation pumps, so those loads will not be available in certain seasons and it’s important that MISO give members the tools to properly report the actual availability of LMRs.
Proposed Audit, Testing, and Penalty Provisions
The Respondents believe that MISO’s proposal to require two unannounced test events per season (8 events per year) is an impactful change that would be a significant deterrent to demand response participants. Most programs currently only test once per year at most and industrial members will opt out of demand response programs if forced to test so frequently. The Respondents understand the goal of testing, but this goal could be achieved with something more reasonable, like two events per year or, at maximum, one event per season (4 per year).
Conclusion
The Respondents understand that MISO wants more certainty surrounding their portfolio of LMRs but believes MISO’s proposal would make it infeasible for most LMRs to continue participating in the MISO markets. Should MISO move forward with their current proposal, it will almost certainly raise the cost of serving customers in the footprint in a very meaningful way with both higher market prices for current resources and the added expense of building new resources to replace the LMR capacity that is being evicted from the system. The Respondents would encourage MISO to find a middle ground such as a 2-hour notification threshold and more frequent testing than is happening today but less than the proposed two random tests per season. The Respondents believe LMRs do provide value to the system and want to work with MISO to ensure that these resources are available when they’re needed but the current proposal moves too far in a direction that will allow existing LMRs to continue to participate in the MISO footprint.
Background
MISO proposed a series of design reforms for Load Modifying Resources (LMR), specifically:
Description of Alliant Energy demand response LMRs
Alliant Energy has state tariff based Interruptible Load and Direct Load Control (DLC) programs accounting for nearly 400 MW of accredited capacity in the summer.
The Interruptible Load program covers a small number (~250) of large customers. Alliant Energy notifies these customers of interrupts through emails, phone calls, texts, and website operations, which is a relatively manual process.
The DLC programs cover many (~50,000) residential and small business customers. Alliant Energy uses antenna-controlled switches to central air conditions and two-way communications with smart devices to interrupt customer equipment. The operation of the notification to customers is a manual process.
Due to operational uncertainties, Alliant Energy takes care to not overstate its LMR capability to MISO.
Non-starter aspects of MISO’s LMR proposal
The three components of MISO’s LMR proposal are each a non-starter for Alliant Energy because we expect that customers would drop from our tariff-based programs with those enforcements. 30 minute or less response time, unlimited call risk, and two tests per season are all deal breakers for customers. We expect this would bring our Interruptible Load capability to effectively 0 MW as all customers exit the programs. Other stakeholders at the April RASC call stated that MISO’s proposal would effectively extinguish existing programs, and Alliant Energy agrees with those concerns.
Although Alliant Energy’s state tariffs allow for some flexibility on number of calls per year, we expect that customers could likely drop out under scenarios where frequency materially increases as MISO has warned.
For DLC smart devices, Alliant Energy is concerned that OEMs would not allow the 30-minute response time proposed by MISO. Effectively this would cause us to remove this program from MISO.
Salvageable aspects of MISO’s LMR proposal
No aspects of MISO’s LMR proposal are salvageable for large customers which is where the majority of interruptible load currently resides. These customers must often manage sensitive processes, so a 30-minute response time is inadequate, as is the risk for greatly increased calls relative to today, and frequent testing. Very few customers rely on behind-the-meter generation in our interruptible program, and those that do are diesel-fueled (subject to RICE rules with limited hours).
It may be possible for utilities to eventually work with OEMs on DLC to satisfy the 30-minute requirement. However, it does not currently appear that OEMs are open to this constraint. The DLC MW capabilities are notably smaller in comparison to large commercial to industrial interruptible load programs.
Feasibility of a DRR-I alternative
Alliant Energy appreciates MISO’s reminder of other potential market tracts for demand response resources, and program comparisons. However, Alliant Energy does not expect that it can easily move its demand response programs without significant elaboration from MISO and the IMM, particularly around offering price limits.
Alliant Energy needs significant additional time beyond this May 3 comment due date to fully investigate a DRR Type 1 alternative option. MISO should provide stakeholders with more hand-holding of the potential risks of this option so LSEs can better communicate with their LMR customer participants and state regulators.
MISO should provide more education on DRR-I/II:
What should MISO do?
MISO has several options to consider:
Other notes and considerations for MISO
American Municipal Power (AMP) appreciates the opportunity to provide feedback on proposed design reforms for LMRs and offers the following comments:
AMP also supports comments submitted in response to this feedback request by MPPA and WPPI.
Consumers Energy appreciates the opportunity to provide feedback on the LMR portion of the Accreditation Reforms that are taking place and agrees with MISO that as the resource mix and market conditions continue to shift, that it is imperative that resource accreditation also shifts in parallel to ensure our reliable grid for the future. Consumers Energy agrees that how we currently utilize LMRs is not providing the intended benefit to grid reliability; requiring analysis and change to the current process. However, the current proposal to change all LMR accreditation to 30 minutes without proper detailed analysis to understand what the true root cause of the issue is, may result in further grid instability driven by decreased participation resulting in elimination of a lever that was meant to help grid reliability.
Consumers Energy supports MISO in ensuring adherence to the program rules and ensure there is not any "double counting" taking place. However, Consumers Energy feels that the data provided on slide 6 is not a fair representation of performance. This does not take into consideration general registration types and the impacts on the current conditions to their accreditation or that there is not a requirement to self-schedule. BPM and or Tarriff updates could easily address the gap once the true gap is identified.
Consumers Energy does not support randomized testing for all programs. Many of these customers are commercial customers in which it costs them thousands to hundred of thousands of dollars to be interruptible, while providing a lot of added benefit to the overall grid if there is a true emergency and would have the biggest impact to shaving load in an emergency. For this reason, Consumers Energy proposes that MISO further evaluate and provide more granular data of LMRs sub types and their performance when dispatched. This would allow a better understanding of the benefit each sub type (i.e. firm load shed commercial, commercial, residential, air conditioning etc.) and if there are sub types of LMRs that perform better than others. Consumers Energy will support randomized testing if the data shows one of the sub types consistently is unable to perform during an event. This would help all parties understand if testing is required and why for each sub type. In addition, there is currently a penalty for non-performance of 3x if the registrant chooses not to test, which could be increased to ensure compliance.
Consumers Energy also does not support moving over to use of DRR in the Energy market and offering these units at a cost. Consumers does understand and supports MISO that it is important that the operators are not focused on future events when making the decision to call events. However, in the past 3 years MISO has not approached the limit of the number of allowable events and this allows customers willing to enroll to have predictability of the cost of participating. If these programs were eliminated from LMRs and forced to DRRs many customers will no longer participate due to the uncertainty of dispatch and the large potential cost to be incurred by the customer. Consumers will possibly support a tiered accreditation approach to the number of events called if MISO feels it needs to increase the number of events available to allow operators to focus elsewhere but does not currently see any data supporting this.
Lastly, Consumers Energy also feels that there is not enough data transparency or information to explain why 30 minutes vs. 1 hour or 1.5 hours? To get to the true root cause of an issue, all possibility of gaps and risk versus probability of each scenario should be evaluated. In this case, there is not sufficient data of how much reduction in participation would occur due to a 30-minute requirement. Consumers Energy also does not see any data on what the risk would be if overall participation was decreased by say 75%. In addition, many stakeholders had provided feedback on a tiered program for LMR’s accreditation with different dispatch times. MISO did not explain why this was not considered as an option, along with dispatching prior to an EE2, which would allow more time for everyone to respond.
Introduction
Responsibility for Resource Adequacy in the MISO region is shared among LSEs, regulatory authorities and MISO (as described, for example, in Todd Ramey’s filed testimony in ER24-1638). A key element of MISO’s role is efficient use of the variety of resources present on the system, via accreditation that accurately reflects each resource’s quantifiable contribution to resource adequacy. This foundational principle appears to have been disregarded in MISO’s LMR proposal.
We find MISO’s need arguments largely unpersuasive. Increased intermittent penetration, for example, is expected to be accompanied by increases in flexible storage that should tend to offset the variability introduced by intermittent generation, and future years should also bring RBDC auction clearing, under which MISO’s LOLE risk will likely decline to well below 0.1. Weather or electrification changes should be reflected in MISO’s calculation of footprint-wide and local capacity requirements, and space heating and vehicle charging should provide new sources of energy-market interruptible demand.
MISO says that it has observed “substantially lower availability of LMRs in real-time” operation compared to the corresponding PRA-cleared quantities. This is a very legitimate concern that merits investigation by MISO and, if appropriate, its IMM. Illegitimate LMRs should be disqualified, LSEs not properly reporting availability should be brought into compliance, and LMRs with availability inconsistent with their capacity credit should have their accreditation adjusted. Truly non-performing LMRs impose a cost on everyone else, and addressing this issue should be MISO’s focus rather than imposing new burdens on legitimate resources.
Notification time
MISO proposes limiting LMR notification times to 30 minutes, with no demonstration of why this is needed. Reference to disturbance-control standards serves only to reinforce that the issue MISO describes is primarily an issue of operating reserves rather than capacity. MISO’s claim of consistency with CAISO practices is inconsistent with our understanding of RA obligation reduction that remains available there.
MISO’s acceptance of longer-lead-time Capacity Resources indicates that the key problem is MISO’s acknowledged difficulty in using its current LMR advance-scheduling capability, and that addressing this should be MISO’s top priority in this area. Alternatively, MISO could create an emergency-only market resource type that otherwise incorporates the characteristics of existing LMRs, including the ability to perform on the basis of a specified firm service level.
WPPI has established notification times for its varied LMRs based on conservative assumptions about capability to provide energy under worst-case conditions, such as starting remote units at night during a winter storm or demand interruption being requested in the early stages of an expensive industrial process. In most cases shorter notification times cannot be achieved both consistently and economically.
Obligation to respond to MISO instructions for each season
MISO proposes to lift all limits on MISO deployments, with no demonstration of the problem posed by current limits. The proper approach for MISO would be to address impacts of deployment limits via LOLE analysis before proposing changes. With this information in hand, MISO could design accreditation for multiple levels of deployability to accommodate a range of LMR characteristics.
MISO deployment of LMRs more frequently than possible under existing limits would entail real costs to the underlying resources, and would undoubtedly exceed the capacity price for some, driving them out of the market.
Proposed audit, testing and penalty provisions
MISO’s proposal to impose random twice-per-season tests on all LMRs would entail enormous incremental disruption relative to the perhaps roughly one (often anticipatable) deployment per year that might be the future norm under RBDC. While MISO suggested that testing costs could simply be included in PRA offers, this could easily yield offers exceeding CONE for interruptible loads, effectively disqualifying such resources. Even for BTMG LMRs, some of which are already tested multiple times each year, random testing can be disruptive and costly. It’s not clear that these costs exceed random testing’s incremental value, given that capability of tested resources is already demonstrated, and non-tested resources are already subject to extraordinary non-performance penalties.
The full scope of MISO’s audit proposal is not clear to us. It is perfectly reasonable for LMRs to submit meter data surrounding actual LMR deployments. To the extent that MISO proposes to collect the identified data for all hours, WPPI could certainly provide this, though we question whether meaningful MISO analysis of this information is both a realistic prospect and a worthwhile use of MISO resources.
MISO’s penalty proposal fails to properly distinguish among LMR types. BTMG LMRs can fail to start or run, like any other generator on the system. Existing accreditation appears to reflect a forced-outage rate of roughly one in six. Accordingly, failure of one in six BTMG LMRs to respond to a deployment call would be wholly consistent with current BTMG accreditation, and failure twice in a row would be wholly consistent for one in thirty-five or so BTMGs. Thus application of MISO’s proposed penalties to BTMGs appears unjustified, as well as difficult to reconcile with the probabilistic nature of resource adequacy and MISO’s existing BTMG accreditation rules.
Proposed accreditation rules
MISO asks how LMR accreditation rules should be designed. The key, as noted at top, is grounding accreditation on the results of carefully performed LOLE analysis, so as to assign capacity values consistent with resources’ quantified contribution to resource adequacy, just as we do for other Planning Resources.
MISO further asks, among other things, what time of day should be considered in accrediting LMRs. Our position is that, as long as MISO continues to determine seasonal load obligation on the basis of forecast peak demand, it remains appropriate to accredit LMRs on this basis as well. As MISO eventually moves to another basis for determining—at least summer—load obligation, it would seem reasonable to reconsider LMR accreditation on a similar basis.
Stakeholder collaboration
Finally, we note the evident widespread dissatisfaction among LSEs with this MISO proposal. We have expressed many of our own concerns above, but beyond this we would point to MISO’s approach to this topic as a driver of frustration for stakeholders. When we ask MISO for an analytic basis for MISO’s proposals, typically none is forthcoming. We will readily acknowledge that our knowledge about operating MISO’s system is limited. MISO’s LMR proposal makes clear that MISO is similarly uninformed about some of the challenges that LMRs face. Through open discussion we can approach an improved mutual understanding, which would be a much better source for solutions that meet all our needs, and that allow us to make the best use of the full spectrum of load-modifying resources on the MISO system.
Cedar Falls Utilities, Central Municipal Power Agency, The City of Ames, Illinois Municipal Electric Agency, Prairie Power Inc, Missouri River Energy Services, and the Southern Minnesota Municipal Power Agency support the feedback submitted by American Municipal Power, Michigan Public Power Agency, and WPPI Energy on the Accreditation Reforms for LMRs presented at the April 17, 2024 RASC.
WPPI Energy supports the feedback submitted by American Municipal Power and Michigan Public Power Agency on the Accreditation Reforms for LMRs presented at the April 17, 2024 RASC.
Michigan Public Power Agency supports the feedback submitted by American Municipal Power and WPPI Energy on the Accreditation Reforms for LMRs presented at the April 17, 2024 RASC.
Northern Indiana Public Service Company LLC (“NIPSCO”) recognizes that this is the start of what needs to be a robust stakeholder discussion. Any changes to the LMR accreditation process will have an impact on state jurisdictional programs. NIPSCO requests that MISO allow adequate time in the stakeholder process to thoroughly review the proposed LMR accreditation changes.
DTE appreciates the opportunity to provide feedback on MISO’s LMR accreditation reform proposal. DTE agrees that some degree of change to LMR accreditation and eligibility is needed due to increasing renewable penetration, more severe weather patterns, as well as other factors leading to emergency conditions that onset more quickly and with less advance warning. To allow MISO to respond to emergencies under this grid of the future, LMRs must be both reliable and able to respond more quickly than they do today. However, the changes proposed by MISO are a significant departure from the historical paradigm surrounding LMRs and will have major implications as to which resources will be able to qualify. It is important that MISO’s ultimate proposal appropriately balances the needs of the changing system with the value (even if diminished) provided by longer lead-time, emergency-only resources. Such significant proposals require greater discussion and robust data to support the changes. DTE has yet to see sufficient, data-driven information from MISO that would justify the changes proposed.
As previously provided in feedback, it should also be reiterated that DTE, like utilities across MISO, has built demand response programs on state-regulated retail tariff programs based on decades of customer feedback. Any changes to existing retail tariffs must be proposed to state commissions and receive regulatory approval. This entire process can take years, a consideration that must be appropriately considered in the proposed implementation timeline.
30-Minutue Notification Time Proposal
DTE understands MISO’s position that the current 6-hour notification time requirement for LMRs may not adequately allow effective and timely response to emergency conditions. However, it is essential that MISO provide concrete evidence supporting the need for a 30-minute response time. Considering MISO’s extensive research and survey data on matters of resource adequacy (including annual LOLE studies, the annual Regional Resource Assessment, and the Renewable Integration Impact Assessment), MISO should be able to provide detailed studies that show what level of emergency response time is necessary to aid operators when dealing with grid emergencies. It is not adequate to only point to current operating practices and other ISO markets (without corresponding detail) when proposing a change that would drastically limit the number of resources that could qualify as LMRs. If MISO does not already have the data to support their 30-minute notification proposal, then a study should be conducted to determine the uncertainty in load and generation forecasts at multiple time horizons to determine the proper notification time requirement.
Pertaining to DTE’s fleet, many of our current LMRs could not respond to a 30-minute notification time. The majority reduce load on the system during emergencies by shutting down industrial processes (steel mills, cement production, automotive), a type of curtailment that could not happen in 30 minutes or less, especially when considering such notification time is inclusive of actions by both DTE operations (acknowledgement of and response to MISO direction in DSRI) and the customer.
Call Limits and Testing Requirements
DTE supports the proposal to remove call limits on LMRs, effectively removing the cap on the number of times a resource must respond during emergency conditions. However, MISO’s new proposal on testing requirements for LMRs (which require response to random real power tests two times per season, for a total of eight times per year) is a drastic change, and the benefits/costs of such testing should be further discussed. This level of real power testing may be considered unreasonable and would likely drive certain LMRs out of the market due to significant economic impact. Specifically, industrial customers currently registered as LMRs would most likely be opposed to stopping production eight times a year under non-emergency conditions, as such requirements would equate to lost revenue and potential implications for their future business if these random testing shutdowns results in missed deadlines to meet their customers’ needs.
MISO has not clarified several aspects of the proposed testing and measurements that must be addressed. DTE has the following questions for MISO related to penalty provisions and implementation of the seasonal testing:
Economic Utilization of Demand Response
MISO has made several references to the option of demand response participating economically as a Demand Response Resource Type I or II. If MISO proceeds with the current proposal and it is put into effect – likely restricting most current LMRs from participating under their current emergency-only designation – then the DRR-I/II pricing structure must also be updated to facilitate participation. While DTE is not fundamentally opposed to increasing economic participation of DR, adequate consideration must be given to the fact that assigning economic costs to individual/classes of customers would be significantly complex due to lack of access to detailed financial information, number of customers, and changing conditions/targets (i.e. costs could vary based on duration of event, time of year, etc.). Current reforms being discussed at the Market Subcommittee – including changes to offer price cap – should be further pursued to allow commercial and industrial customers to accurately represent the cost/lost opportunity associated with interruption events. For further explanation/discussion, please see DTE’s comments in response to MISO feedback request titled “Demand Response Participating as a Supply Resource in MISO Markets (20240418)”.
Locational Information and Data Submission
DTE understands that MISO operators need more granular locational information pertaining to LMRs so that localized system emergencies can be better managed. MISO states this is driving the need behind requiring all EPNodes and physical addresses associated with an LMR to be provided at the time of registration. However, such requirements would result in an unworkable volume of data and place unreasonable burden on stakeholders. For example, DTE has a registered LMR that consists of customers on interruptible air conditioning (IAC) rates. There are tens of thousands of customers on IAC and customers may be added or removed from the program daily. While it is possible to provide MISO with a list of addresses, the task of formatting, submitting, and updating the address list with each change would be a massive undertaking. In addition to this, any load reduction forecast at the EPnode level for customers registered in the IAC program would only be an estimate based on the number of households registered inside of the EP node. MISO should be aware that requesting this level of aggregation may not provide the insight expected.
DTE also agrees that MISO needs the ability to audit LMR data on a more regular basis to verify actual availability of these resources. However, requiring meter data within 30 days compared to the current requirement of 103 days may lead to unintended consequences. DTE’s current meter validation process for LMRs takes 53 days. Shortening the process will be challenging as DTE has meters that must be manually read as well as other meter data that must be validated using extra steps. A shorter timeline to perform these steps may lead to data that is not as accurate. Can MISO provide details as to why they require the data within 30 days?
Re: RASC Proposal on Accreditation Reforms for LMRs (RASC-2019-9)
Great River Energy (GRE) appreciates the opportunity to provide feedback on MISO’s proposal to reform accreditation rules and requirements for load modifying resources (LMR). As discussed below, GRE is generally supportive of reforms that enable more efficient deployment of LMR but is opposed to changes that create an undue compliance burden or cost risk to LMRs. GRE believes that LMRs are an important resource for load serving entities (LSE) to satisfy resource adequacy requirements and for MISO to deploy during emergency conditions.
General comments on the RASC 04/17/2024 presentation
On slide 6, this is showing the disparity between cleared LMR capacity in the PRA vs DSRI availability. This disparity is an accreditation problem. Accreditation reforms proposed in August 2023 will likely fix that. This diagram does not support the reforms introduced on April 17 regarding notification speed or performance issues, but instead is showing a few bad actors gaming the system which currently allows hourly availability to be disconnected from accredited capacity.
On slide 9 MISO proposes to utilize DSRI to leverage availability for all LMRs, which presumably includes intermittent BTMG’s. GRE is opposed to the idea that intermittent BTMG’s should report hourly availability to DSRI and reaffirms the notion that these resources are not dispatchable but instead are generally always must-running themselves. Refer to GRE’s feedback submitted in response to the August 2023 RASC.
On slide 9 MISO proposes to redefine and create avenues for LMRs to be accessible prior to emergency conditions. If LMRs are going to be accessible prior to emergency conditions, as was the directive change in RAN Phase I, then why won’t MISO use LMR’s prior to emergency conditions? Making long-lead (aka 2 hour) LMRs available at earlier stages of emergencies could lead to more frequent dispatches but would ensure that these resources can continue to serve the grid. GRE agrees that fast-acting 30-minute resources are needed when MISO reaches NERC EEA Level 2, but MISO shouldn’t wait until that level to start using long-lead LMRs – which is what was already addressed in RAN Phase I. Also, note that MISO has clarified on slide 8 that MISO can access LMRs “in anticipation of EEA2 once Capacity Advisory Alert or higher has been declared by MISO.” So, it’s not clear to GRE what is preventing MISO from accessing 2-hour LMRs today once a Capacity Advisory Alert is declared.
Shorter notification times will cause some high reliability LMRs to unregister.
Forcing long lead LMR’s to be DRR’s is likely to create anxiety about the new rule sets and the must-offer requirement of DRR’s and result in withdrawal by some LMR participants. Many LMR’s can serve the grid for reliability needs but have no interest in participating in the energy markets for financial gain during periods of grid stability. DRR-I and DRR-II market products have existed for some time, but today don’t have a must offer requirement if they are dual registered as LMR’s instead of being DRR’s registered alone as Capacity Resources. Refer to the Venn diagram of DR options published in the April 18, 2024 MSC. In effect, MISO is proposing to force 2-hour LMR’s to be DRR’s, while simultaneously taking away the “can offer” option from DRRs and forcing them to be “must offer”. We think MISO should make this more transparently clear to the stakeholder community. MISO would also need to lower the minimum registration size of DRR’s from the current 1MW to 100 kW.
MISO will need to help LMR owners understand differences in obligations and operations that may exist in the DRR constructs, if that’s to be the only path for a 2-hour LMR to maintain ZRC capacity value. MISO should provide a workshop tutorial to demonstrate to MP’s who may have historically stayed comfortably within the boundaries of LMR rules how exactly to transform an LMR registration into a DRR, accommodating the requirements of the Network Model, Commercial Model, E&OR Offer Parameters, Dispatch Instructions, Measurement & Verification, Settlements, Net Benefits Price Threshold, and Penalties for Underperformance.
MISO’s request for retail customer locational information and demand capability details is unnecessary and creates an undue burden on market participants with LMRs that aggregate thousands of residential accounts.
MISO doesn't identify locational awareness in its problem statement. We disagree that more detailed locational information (like EP Node, Zip Code, or Address) are necessary changes in the LMR reform because it’s not related to the nature of the problems MISO wants to solve. It seems MISO’s primary concerns are speed of response, and providing MWh available to operators from LMRs which are accountable and well aligned to the LMR accreditation awarded. Neither of those two issues have anything to do with locational awareness, and MISO has not shown what new operating tools are going to be developed to make locational details available to and part of the dispatch solution.
Although MISO has announced developing a new Locational Enrollment Tool for collecting location information for LMRs, MISO has not demonstrated how MISO would have the capability to dispatch locationally around Local Transmission Emergencies at the EP node level. MISO also has not demonstrated why personal addresses are relevant to MISO, or the kW per address. We agree with the comments at the RASC meeting which highlighted the issues of dispatching LMR’s regionally for a constraint that may lead to exacerbating the congestion issue if load is reduced on the wrong side of the constraint. GRE believes that LMR’s are not appropriate tools for congestion management; but instead, they are intended for capacity emergencies and providing reliability during periods of low-capacity reserves. Congestion management is addressed through the energy markets, not through emergency operating procedures.
If there is a 30-minute lead time before an emergency asset is needed, MISO does not have the tools to make conditional decisions about which LMRs to run and which to exclude based on their location in the network model and proximity to a congestion wall. MISO’s max gen events don’t operate like a scalpel– but instead are more general (albeit useful) tools for large regional capacity support. EEA2 events are declared and dispatched by region (North, South, Central) or sometimes by LBA. Capacity emergencies are not declared by local resource zone or EP node, and congestion is managed by market price signals sent to energy market assets.
The proposed locational requirement for LMR is unsupported by MISO presentation materials and stakeholder discussions. GRE understands that MISO wants visibility into the electrical location of the LMR’s to improve operator ability to manage localized transmission emergencies. But requiring the physical address does not lead BA operators to the correct mapping or knowledge of electrical location in the system for reliability operators to effectively manage Transmission System Emergencies or Local Transmission Emergencies.
During discussion at the RASC, MISO acknowledged that demand reduction volume is not required for each physical address, as is written on slide 18. Such a requirement would be particularly cumbersome considering the small residential accounts participating in an air conditioning DR aggregation. In this case, MISO’s accepted methodology is to assess an average per-customer model using a sub-sample of residential homes which represent a statistically significant portion of the program at large. As such, the kW volumes per address would merely be listed as an average modelled amount – a meaningless but enormous data set for MISO’s operators whom are only interested in the aggregate kW estimated response. MISO staff stated verbally that address information was only requested to verify there is no double counting of registering 1 address in 2 LMRs, in case an ARC is registering something that another Market Participant has already registered. We agree with the principle of auditing to ensure that an ARC doesn’t contain an address already participating in another LMR – but that auditing duty is the responsibility of the LBA today and is already facilitated without MISO’s collection of this detail.
GRE agrees that LMRs should be available for all emergency events to support grid reliability.
MISO’s proposal to eliminate limits on the maximum number of calls is understandable. GRE agrees with the philosophy that LMR’s are meant to serve the grid for reliability, and all emergency events are equally important in their effort to prevent worst-case shedding of firm load.
GRE agrees that MISO should audit LMRs and maintain sound penalty provisions but disagrees with the proposed seasonal testing requirements.
GRE has no concerns about a requirement to submit data within 30 days of the operating day. We also agree with MISO’s interest in auditing availability in DSRI using data to ensure legitimate numbers are being posted.
However, expansive random testing requirements are not necessary to ensure the integrity of LMR’s. We understand MISO has had several cases of fraudulent activity from bad actors, but random testing for the masses is an overreaction. GRE self-schedules our LMRs regularly for local testing and local grid management, and GRE submits real test data to the MECT to demonstrate capacity verification. Random testing may be warranted for LMR’s that refuse to submit real test data from the prior calendar year and instead only show mock test data. Another valid reason for random testing is for LMR’s who have reasonable suspicion as determined from MISO or IMM who are showing suspicious DSRI data or who have failed to respond from historic LMR schedule instructions during real events.
GRE’s member-consumers appreciate that registering as a LMR means their business won’t be interrupted during mild grid conditions, and curtailing their service is consistent with times of true reliability need. If seasonal testing dispatched by MISO is found to be necessary and warranted by the stakeholder community, then GRE would urge MISO to consider executing only one random test per year with such test occurring only during Capacity Advisories, Max Gen Alerts, or Warnings. Such a protocol would ensure the tests are better aligned to times that provide a benefit to the MISO system and not during random days that could have low load conditions and be misaligned with reliability. To that effect, MISO could test LMR’s during times of alignment to grid value when early warning signs occur – but MISO wouldn’t need to wait until EEA2 to learn if the LMR is ready.
Regarding the new penalty provisions: proposing to claw back capacity payments from a single failure is not consistent with other accredited resources that may have failed to run due to a forced outage – such facilities don’t have to forfeit payments they are impacted on their XEFORd. We think existing penalty provisions of today’s Tariff are adequate motivation for LMRs to perform well.
These comments are submitted to RASC on behalf of the Upper Midwest Municipal Energy Group (UMMEG) and pertain to the accreditation reform rules. UMMEG is a municipal electric company/joint action agency comprised of 15 municipal electric utilities located in Wisconsin, Minnesota and Iowa. Our members own and operate approximately 100 MW of small diesel and dual fuel generators which are registered LMRs. Although they have been equipped with catalysts and other equipment designed to operate in accordance with RICE rules for non-emergency purposes, they are essentially designed for reliability and not to participate in the energy and capacity markets. These units are operated and maintained in accordance with prudent electric standards and meet the current MISO rules with respect to run time and response time. The proposed rules would subject our members to substantial economic hardship were they to result in loss of accreditation or participate in the PRA and be dispatched if cleared in the auction as DRR-II resources. For clarity, by "economic hardship" we mean not just our municipal utility members, but our customers, particularly the larger commercial and industrial customers we serve. These customers rely on our utilities for reliable and economically competitive power and energy. If compliance with these new requirements causes our members to significantly increase their rates or subject our customers to load interruptions or curtailment, the results will be devastating to our communities- some of our members' large customers may simply be forced to leave town. UMMEG understands the reason for these proposed reforms, including the need for 30 minute or better response times. We wonder why MISO could not create a category of DRR resources that would be available to meet EEA2 system needs with the current 2 hour response time requirement without having to participate in the PRA. UMMEG is also concerned about its ability to comply with the proposed random testing events. UMMEG would encourage MISO representatives to meet with us so we can discuss the potential real-world impacts of these proposed reforms. Thank you.
Wolverine Power Supply Cooperative ("Wolverine") supports each element of MISO’s proposed design reform. For years, the resource adequacy of the electric grid in MISO has been hoping that load modifying resources (or “LMRs”) as the last resort resources (i.e., the insurance policy) will be available and will respond timely to keep the lights on. However, when the data is analyzed, LMR availability is far below expectations, creating a false hope. In the past five MISO Planning Resource Auctions (“PRA”), LMRs have cleared about 12 GW, but, on average, only provided 6 GW (50%) of availability.[1] If LMRs were accredited based on their availability, which they should be, then the results of MISO’s past five PRAs (see table below[2]) would likely no longer paint a picture of adequacy (i.e., surplus) but rather inadequacy (i.e., shortfall).
PRA | Surplus |
2020/2021 | 5.5 GW |
2021/2022 | 6.5 GW |
2022/2023 | 1.3 GW Shortfall |
2023/2024 | 6.5 GW |
2024/2025 | 4.6 GW |
Why is there such a difference between accreditation and actual availability for LMRs? MISO’s current rules do not incentivize LMR availability and performance.
The electric grid cannot continue to hope an event does not occur while doubling down and also hoping LMRs will perform. To do so only continues to perpetuate the currently faulty insurance policy whereby all LMR owners (both good and bad actors) receive all the reward with very little responsibility.
Further, several commentors at MISO’s April 17, 2024 RASC meeting noted how MISO’s proposal may be unreasonable and discriminatory when compared against the requirements for other resource types. However, the opposite can also be said. To qualify as a capacity resource, Schedule 53 resources have year-round Day-Ahead and Real-Time must offer requirements, mandatory testing requirements, and outage scheduling requirements. While LMRs have significantly less onerous requirements to participate in MISO’s markets, they are assumed to provide the same reliability value and, therefore, receive the same compensation as Schedule 53 resources. The current disparity in treatment of LMRs versus Schedule 53 resources creates an unreasonable and discriminatory market construct, only to the benefit of LMRs.
Wolverine supports all resource types, the attributes they provide, and a just and reasonable compensation for the provided reliability value (i.e., MISO’s Reliability Imperative). Modifying load has the potential to provide significant reliability benefits while reducing transmission and generation infrastructure costs, but only if the flaws in the market and dispatch designs are resolved. As addressed by Wolverine’s comments above and by MISO’s RASC presentation, the current LMR construct does not meet the objective of the Reliability Imperative. MISO’s proposal is a solution to improve the current process by ensuring availability and providing equal treatment between LMRs and Schedule 53 resources. For LMRs that are willing to make themselves available but are unable to meet the stricter requirements, Wolverine supports MISO’s suggestion that those LMRs consider participation in other resource types. In the alternative, Wolverine supports MISO developing a new resource type to accommodate long-lead time resources, as long as the qualification requirements align accreditation and compensation with availability.
Regarding MISO’s proposal, Wolverine echoes MISO’s remarks from the April RASC meeting, in particular:
The current LMR construct is a flawed insurance policy that relies on hope instead of a plan. Wolverine recognizes MISO's proposal will impact Wolverine's LMRs, however, Wolverine also supports MISO's proposal because it recognizes that changes are required to ensure that all resource types are treated fairly and equally, and ultimately, available and accessible to keep the lights on.
[1] See LMR availability data from MISO’s April 17, 2024 RASC presentation and MISO’s Monthly Operations and Markets Reports.
[2] Data from MISO’s repository of PRA results
RASC: Accreditation Reform for LMRs
Arkansas Electric Cooperative Corporation (AECC) appreciates the opportunity to comment on MISO’s proposal to modify requirements for Load Management Resources (LMRs).
If MISO moves forward with all its proposals, AECC fears reliability will be impacted negatively, as existing LMRs will convert to firm load, exacerbating the need for new capacity resources.
Regarding a notification time of 30 minutes, AECC believes this will be unachievable for the industrial facilities that AECC currently register as LMRs.1 AECC’s tariff, approved by the Arkansas Public Service Commission, has a notification time of 3 hours, and this is based on a realistic timeframe required for the facilities to shut down processes and avoid the excessive costs and risk of damage to equipment and site product that a 30-minute cessation of its processes would cause.
AECC asks MISO to please consider the following:
(a) LMRs that can be called only once MISO is in an EEA-2 can be held to the 30-minute notification time.
(b) LMRs that can be called prior to an emergency event to be provided a longer notification time. Options should exist to allow for a notification time of at least 3 hours.
Regarding MISO’s proposal to remove limits on the number of times that Market Participants are obligated to respond to Scheduling Instructions, AECC believes that limits should remain under the type (b) LMRs in the preceding paragraph, or alternatively, that once certain limits are reached, that the LMRs can then only be called in an EEA-2 event, but still with notification times of at least 3 hours. For AECC’s industrial facilities that are registered as LMRs, they are a key engine for the economy in the state, providing valued products, jobs and tax revenues. While these industries recognize that in return for a reduced electricity rate, they can be curtailed prior to firm customers, an ability for MISO to curtail them an unlimited number of times is not acceptable.
Regarding the proposal of at least two tests per season, this is a significant imposition. Again, for AECC’s industrial facilities that are registered as LMRs, they are a key engine for the economy in the state, providing valued products, jobs and tax revenues. Shutting these industrial plants down is a significant effort and impacts their economic viability. Demonstration of past performance through previous MISO interruptions should suffice in place of the tests. Penalties for non-performance would also be an appropriate alternative to very disruptive testing.
Thank you for the opportunity to provide feedback.
Duke Feedback to MISO’s LMR Accreditation Proposal (RASC-2019-09) (20240417)
General Feedback on Accreditation Revisions and Overall Process
Duke Energy Indiana (DEI) continues to support MISO’s efforts on LMR Accreditation Reform. In addition to direct feedback on the requested “Proposed Design Elements”, DEI has also provided feedback intended to assist MISO in addressing more systemic issues it believes heavily contribute towards unreliable, inconsistent, and opaque data provided by Market Participants (MPs) to MISO in terms of LMR capability registered (via MECT) and LMR availability reported (via DSRI). In short, while supportive of a measure of reform in each of the proposed design elements, including a quicker, 30-minute LMR option, DEI believes the overall LMR Accreditation Reform Proposal as initially proposed by MISO during the April 17th RASC is both too aggressive and lacks consideration of the characteristics and operational attributes and limitations of LMRs.
DEI would also continue to encourage MISO to consider a technical workshop or similar approach aimed at extending two-way dialogue between MISO and its stakeholders. DEI is always happy to provide feedback in written form and through individualized conversations but based on some MISO viewpoints shared during the April 17th RASC, it was obvious MISO has some operational challenges which would benefit from quicker notification time LMRs. While this viewpoint may have been shared in written form before, hearing this feedback directly from MISO Operations personnel added significant context and value to the conversation. Similarly, many MISO stakeholders shared that some amount of quicker notification time LMRs could be provided with minimal effort, but that many other LMRs (particularly, those composed of larger retail customers manually curtailing load) are very willing to respond, but simply are not capable of curtailing these loads in a safe manner within 30-minutes. Again, DEI is encouraged with the discussion thus far and feedback requested by MISO – especially the LMR characteristics – but it is our belief dedicated time to two-way discussion between MISO and stakeholders (outside of a formal RASC meeting) addressing each of these design elements, the concern warranting the proposed change, and gathering ideas from both MISO and stakeholders, would result in more effective collaboration between groups.
Feedback on LMR Design Element: Notification Time
As mentioned above, DEI appreciates MISO’s need for quicker notification time and is supportive of a 30-minute LMR notification time option. However, as expressed verbally during the April 17th RASC, DEI is not supportive of a unilateral move to 30-minute notification time for all LMRs. DEI requests MISO consider a more measured approach for the evolution of LMRs, including development of a new 30-minute notification time option for LMRs. As noted below, DEI would propose and offer that many LMRs should be required to respond within 30-minutes should their characteristics and operations support such a notification time. Other LMRs, while very willing to curtail, test, and remain ready and reliable, are not capable of curtailing load in a safe manner (for equipment and personnel) within such a short notification time. DEI elaborates on such an approach below in its proposal on LMR reform.
DEI has continued to encourage MISO to consider direct dispatch of LMRs as part of this proposal. Indeed, while DEI supports a 30-minute LMR notification time option, for such an offering to be successful, direct MISO dispatch of the LMR will be necessary. To be clear, DEI is not suggesting MISO have direct control over retail load or curtailment systems, but rather that MISO remove a barrier to success by directly choosing which LMR to dispatch and sending web-based communication to MPs of this dispatch along with details of the selected LMR(s) and start/end time. In addition to eliminating steps involving MPs selecting LMRs and entering data into fields within DSRI, such an approach would also allow those MPs with the capability to intercept this signal and trigger event dispatch and notification within their own systems.
Rationale / Examples: In support of some LMRs being capable of 30-minute notification time, DEI would point to most traditional residential air-conditioning load control programs. Many legacy offerings are based on radio technology and more recent thermostat-based offerings are based on similar if not more robust 2-way telecom systems. Once the dispatch system has been activated, load shed begins to accumulate within a matter of minutes. DEI therefore believes such LMRs can provide curtailment within 30 minutes. However, within the context of an Emergency, every moment matters and for such an approach to be successful, MISO would need to provide DEI with a dispatch signal (as noted above).
Other LMRs are not physically capable of providing curtailment within such a short timeframe. As noted in its proposal below, DEI believes value for such LMRs should be preserved. DEI would also note that, as discussed during the April 17th RASC, a unilateral move to 30-minute notification time for all LMRs would be counter-productive in addressing systemic issues associated with LMR capability determination (MECT) and LMR availability (DSRI).
In support of the dispatch approach mentioned above, DEI would point to PJM which utilizes a similar approach to that described. In addition to the benefits mentioned above, this approach generates ancillary benefits as well in terms of operational coverage and awareness of LMR dispatch. Again, DEI would encourage MISO to implement such an approach, particularly for 30-minute notification time LMRs.
Feedback on LMR Design Element: Obligation to Respond Each Season
DEI is not supportive of a move to an unlimited number of LMR calls at this time, particularly in light of other reform elements.
Rationale / Examples: DEI would point to MISO’s own analysis from 2019 for LMRs in preparation for the Seasonal Accreditation Construct. This study illustrated with high likelihood sixteen (16) annual events would be sufficient to address MISO’s operational needs and resulted in full (100%) accreditation. DEI would request additional study, research, and/or empirical data to support a move to a fully unlimited number of annual calls before considering support for such a change.
Feedback on LMR Design Element: Audit, Testing, & Penalty Provisions
DEI has mixed feedback on these elements of LMR reform. Considering testing, DEI is supportive of one (1) annual test for LMRs. However, additional testing with the intention of demonstrating full load drop within the requested notification time, as proposed by MISO, is not supported. DEI believes such an approach is too aggressive and would be viewed by retail customers as little different than experiencing eight (8) emergency events annually. Similar to other reform elements, some evolution of testing can be considered, but full implementation of the as-proposed eight (8) annual events would result in significant losses to LMRs capability – primarily from retail customers very willing to participate in load curtailment during a Grid Emergency, but not willing to cease economic production on a nearly monthly basis.
Regarding proposed penalty provisions, DEI’s feedback is similarly mixed. DEI is supportive of meaningful consequences for MPs and LMRs which are unable to perform during emergency events in manner consistent with availability data provided via the DSRI. Similarly, should DSRI values consistently vary in a manner not supportive of capability provided in the PRA, this, too, should trigger some consequence. DEI is supportive of the current penalty provisions in place, outlined in BPM-11. At a high level, current provisions allow MISO to disqualify an LMR at most after two (2) event performance failures.
Rather than implement the penalty provisions as proposed in the April 17th RASC, DEI would suggest MISO implement addition reforms pointed at addressing the potential root of non-performance issues rather than enhancing the non-performance penalties themselves. While referenced in DEI’s proposal on LMR reform below, more specifically these additional reforms would include:
DEI is convinced a primary driver of the disconnect between LMR capacity (MW) sold in the PRA and LMR availability (MW) communicated in the DSRI is the lack of a standardized approach to capacity determination for LMRs. No standard calculation exists, and unfortunately Tariff Attachment TT is of little help in providing clear guidance on this topic. In DEI’s experience, such guidance is largely based on the following verbiage:
While this wording is helpful at a very high level, it lacks objective clarity (is open to interpretation), and no direct calculation methodology is provided. DEI believes this results in inconsistent LMR capacity quantification across MPs. DEI’s approach has been to register LMR capacity in a manner consistent with a formal event settlement, using the associated M&V methodology outlined within Attachment TT for the LMR in question. Essentially, DEI registers LMR capability and provides MISO with LMR availability (within the DSRI) in a manner consistent with an emergency event settlement.
DEI implores MISO to implement a standardized, calculated process such as this. Not only would this provide MISO with critical transparency within the LMR capacity sold into the PRA, but DEI believes it would significantly reduce the gap in LMR capability between system (MW sold in PRA vs. MW available in DSRI).
DEI would appreciate additional conversation regarding LMR capability calculation(s) and continues to support a review and refresh of Attachment TT (as noted below), but outlines a high-level example of LMR capacity calculation for a hypothetical LMR utilizing a Firm Service Level (FSL) baseline below:
While the literal calculation may vary by M&V option selected, metered load data must continue to be the basis for LMR capability. Such an approach would allow for both transparency into LMR capability and would result in more consistent and comparable results and approaches across MPs with LMR portfolios.
Lastly, DEI believes there is opportunity for development of a software tool, or similar, which would largely ingest meter data and perform such a calculation utilizing other inputs. Such an effort may be worth of consideration in the future.
While it was not explicitly discussed during the April 17th RASC, DEI requests MISO clarify whether the DSRI updates previously shared during the November 8th RASC will be implemented. DEI encourages MISO to move forward with full implementation of these system updates as DEI believes these updates are critical to addressing MISO’s lack of visibility into the validity of LMR availability as reported in the DSRI. Further, a key aspect of these updates was the ability to base future-year LMR accreditation off MW values present within the DSRI. DEI believes this approach could be implemented in a manner consistent with the aforementioned “Registration Calculation” enhancement above.
DEI would also encourage MISO to continue to explore the nature of FSL LMRs particularly within the context of DSRI updates. While MPs utilizing meter data will be able to demonstrate periods when LMR load drops below the value sold in the PRA (default DSRI value, through utilization of the “Reduced Load Availability” field), the proposed updates may not capture potential increased capability. MPs do not have any incentive to report LMR availability above the MW value sold into the PRA, though some LMRs may at times have significantly increased capability during emergency conditions. Such characteristics must be carefully considered as part of the larger reform effort.
DEI is supportive of MISO’s enhanced auditing provisions, within the context of DEI’s immediate feedback on “Testing” and “Penalty” provisions, above. Specifically, LMR capacity values registered in the MECT can be audited if a calculated approach, such as the one above, were implemented. Similarly, DSRI values could also be audited on a regular basis.
Rationale / Examples: As noted above, DEI believes the inclusion of these aspects to the overall reform effort would address the source of more systemic issues that DEI believes MISO may be attempting to address through very aggressive increases to the number of annual events, testing frequency, and penalty provisions. While the market constructs are considerably different, DEI would also point to PJM in terms of utilization of its Pead Load Contribution (PLC) value to determine Load Management (i.e.: “LMR”) capacity values. Such an approach does not remove all risk but facilitates an even playing field for MPs.
DEI Proposal on LMR Reform
During the April 17th RASC, there were a number of instances during the LMR presentation and resulting verbal feedback when MISO requested stakeholders help provide guidance on approaches where a 30-minute LMR product could be provided, but longer lead time LMRs still provide value. While DEI does not support an approach where existing LMRs are instead dispatched through economic means (i.e.: DRR-I, etc.), it has put thought into a potential approach to overall LMR reform which DEI believes would result in MISO realizing considerable 30-minute LMR capability, would increase alignment of notification time across MPs, and would maintain value for longer lead time LMRs.
DEI encourages MISO to continue considering that the operational and physical attributes and characteristics of LMRs are a key pillar of this reform effort. It is DEI’s belief that thoughtful consideration of LMR characteristics and Operational characteristics (including the different types of situations leading to operational grid strain) will result in a superior outcome for this reform effort.
In DEI’s view, the overall LMR Accreditation Reform effort has helped identify a number of metrics important to a successful outcome and evolution of LMRs (and more broadly, “demand response”) within the context of an evolving grid. Specifically, based on the reform effort thus far, DEI sees the following metrics as indicating success in this effort:
DEI has provided direct feedback (herein; above) on how to improve the first three (3) metrics and will focus primarily on how to provide MISO with a 30-minute LMR product while retaining value for longer lead time LMRs.
DEI proposes an approach where LMR notification time is based on a standard. Similar to approaches utilized within Technical Resource Manuals (TRMs) to support assumptions for Energy Efficiency, this approach would provide a granular, process-specific listing of notification times for load curtailment and would focus particularly on manual load curtailment approaches. Essentially, this approach would eliminate variability in notification time by LMR (business/process type). It should be noted such an approach would also result in additional effort on the part of MPs to group LMRs accordingly, but DEI would be supportive of such an approach within the spirit of overall LMR accreditation reform.
To elaborate further on “standardized notification time”, and for purposes of illustration, LMRs such as residential direct load control of air conditioning (via switch or thermostat) would likely be deemed to have a 30-minute notification time “standard”. On the other end of the spectrum, many critical processes, such a refining or chemical processes, may be deemed to have a much longer notification time, perhaps even in excess of 2-hours to ensure safety of personnel and equipment. Many other industrial processes, including electric arc furnaces and heavy manufacturing may reside in a range between one (1) and four (4) hours.
It should be stated for clarity, however, that the values above are only examples. DEI’s proposal is simply to address notification time through standardized process. So long as an LMR registers utilizing the standardized notification time, it would receive full accreditation (at least based on the attribute of notification time). It is doubtful such information exists within current state-level TRMs and would likely need to be collected / developed. DEI would propose MISO engage with stakeholders to develop a starting point for determining standardized notification times and processes and would further note the LMR characteristic feedback below pairs well with such an effort. It should also be noted that end use customers themselves can be engaged to help support development of these notification times.
To conclude on this point, DEI realizes additional consideration would be needed to implement such an approach. DEI is confident implementation of such an approach, when coupled with greater standardization and auditing of LMR capacity will result in material 30-minute LMRs for MISO Operators and continue to provide value to MPs for longer lead time LMRs. DEI realizes this approach alone does not address operational concerns expressed by MISO in terms of lack of ability to call all LMRs within 30-minutes, but DEI would encourage MISO to think creatively about alternative means to dispatch these resources, including stacking of LMRs within/beyond the 4-hour event window, or more fully considering the different types and characteristic of operational events causing grid strain and “pairing” or “matching” LMRs with corresponding and complimentary attributes.
Additional Feedback on Overall LMR Reform
DEI would like to provide some additional feedback based on tangential, but potentially meaningful points made by MISO and stakeholders during the April 17th RASC.
Clarity Regarding Settlement of 30-Minute LMR: DEI requests MISO provide clarity on how LMRs will settle financially given they may be called on the half-hour. How does MISO proposed hourly meter data be used to support 30-minute curtailment which may be misaligned with clock hour for the first (and last) hour of an event?
Supportive of Review of Attachment TT: DEI would encourage MISO to review and update Attachment TT.
3rd Party LMR Review / Meter Data Legitimacy: DEI would also encourage MISO to consider having Load Serving Entities or others with retail energy meters to assist in verification efforts of 3rd party LMR registrations. While DEI is not formally proposing MISO implement such a process, within the greater effort of LMR reform (and eventual FERC 2222 compliance), DEI would encourage MISO to consider such an approach. LSEs should consider a verification step of retail customer information (such as account / meter number, meter data, etc.) to the extent this assists MISO in maintaining transparency and oversight of LMRs registered by 3rd parties.
Feedback on LMR (BTMG & Demand Resource) Operating Characteristics
DEI is appreciative of MISO’s requested feedback on LMR “operating characteristics”. It should be noted while generally representative of the types of LMRs registered by DEI, the following information should only be considered illustrative for purposes of this public feedback. More granular and precise information can be made available to MISO if requested.
Behind-the-Meter Generation:
Demand Resource(s):
LBWL feedback to MISO’s 4/17/24 LMR Accreditation Proposal Due 5/3/24
RASC: Accreditation Reforms for LMRs (RASC-2019-9) (20240417)
05/03/2024
In the April 17, 2024, meeting of the Resource Adequacy Subcommittee (RASC), MISO proposed a series of design reforms for Load Modifying Resources (LMR), specifically:
For any concerns with the proposed design element or any other issues, MISO requests that the stakeholder provide supporting rationale and examples, if applicable.
MISO also encourages stakeholders to share additional comments about MISO's overall LMR reform proposal based on the reliability imperative and market efficiency drivers discussed during the April 17 RASC meeting.
MISO requests that stakeholders provide a list of different operating characteristics (e.g. time of day or temperature dependent), aggregation including number & type of end use customers (e.g. 10,000 residential customers or 50 commercial buildings) for your LMRs that MISO should consider for developing appropriate LMR accreditation rules.
Comments are due by May 3.
LBWL Feedback
First, LBWL would like to thank MISO for incorporating the partnership of Stakeholder input with MISO.
LBWL supports MPPA’s feedback to this proposal.
LBWL would like to add one suggestion. If MISO were to alter the definition of the DRR-Type II to allow for positive flow, it would be helping MISO, plus make that registration more flexible and desirable. For example - If MISO was approaching an emergency state and a DRR-Type II (at the same time) was fully supporting its load (POI = 0 MWs), the DRR-Type II could not be of any help to the MISO shortage situation since its POI was 0 MWs. If the DRR Type II was allowed & capable of flowing positive MWs at the POI, it would help mitigate MISO’s shortage issue. It would function in a similar way to an ESR (the ability to run positive and negative).
MISO Resource Adequacy Subcommittee Feedback
Hoosier Energy Rural Electric Cooperative
Southern Illinois Power Cooperative
May 3, 2024
Hoosier Energy Rural Electric Cooperative (“Hoosier”) and Southern Illinois Power Cooperative (“SIPC”), collectively (“the Respondents”), thank MISO for the opportunity to provide feedback on the MISO’s proposal on Accreditation Reforms for Load Modifying Resources (“LMR”) presented at the April 17th Resource Adequacy Subcommittee (“RASC”). MISO requested feedback on the proposed design elements:
Notification Time
The Respondents view MISO’s proposal to require a 30-minute or less notification time for all LMR deployments to be a major departure from the current rules surrounding LMRs and would likely force almost all of their current LMRs to no longer participate in MISO’s markets. While we recognize that MISO has seen a difference between LMR capacity that clears the PRA and what’s actually being offered on a daily basis into the Energy markets, changing the rules in such a drastic way for all LMRs in an effort to eliminate this gap is a step too far. Based on MISO’s Appendix in the presentation made at the RASC, if no LMRs change their notification time, this proposal would eliminate more than 92% of LMRs, or roughly 11GWs of capacity. This would have dire consequences on the cost to customers in the MISO region as the latest Planning Resource Auction had a 4.6GW surplus, effectively ensuring that Cost of New Entry (“CONE”) pricing if implemented today. As member-owned G&T cooperatives, the Respondents are very sensitive to the costs borne by our members and feel this proposal could have a dramatic impact on member bills without a commensurate increase in the reliability they get from being members of MISO.
Instead of changing the notification time to 30 minutes, the Respondents preference would be to allow MISO to gain access to LMRs earlier in the Emergency procedures before Step 2A as it is today without a change in the notification time structure. MISO stated at the RASC that a big issue in their eyes is that they cannot gain access to the 12GWs of LMR capacity until they are in EEA Step 2A, which we are sympathetic towards. Historically MISO has been able to forecast when they would need additional capacity further out than 30 minutes and we believe gaining access to these resources earlier in the EEA process could provide more value to MISO’s operators than the current structure and be less impactful to LMR owners who cannot respond in 30 minutes.
If MISO does move forward with changing the notification time, the Respondents propose a 2 hours or less notification time requirement would be more appropriate than the 30-minute proposal. Based on the Appendix in MISO’s presentation, a 2-hour notification time would retain approximately 55% of the current LMR fleet while giving MISO more certainty around response times if an emergency is forecast. Most of the Respondents LMR portfolio which includes industrial members, load control programs and behind-the-meter generation could respond within 2 hours and still provide MISO with the capacity it desires during emergency conditions. The Respondents believe this is an appropriate compromise and provide MISO with more certainty around availability of LMRs and still provide value to the markets in MISO.
Should MISO move forward with its presentation as proposed, the Respondents would most likely convert all behind-the-meter generation into DRR Type I assets, participate solely in the Energy market due to the burdensome metering and telemetry requirements that are required for participation in the Ancillary Services market, and change the operating characteristics of those resources with longer lead times and more restrictive operating parameters to reflect environmental limitations. Given that most of these generators operate with expensive fuel sources, the offer prices would be very high in order for them to cover their costs which would effectively make them Emergency-only resources. We don’t believe that this setup would be more beneficial to MISO than the current LMR framework today and aren’t sure this would improve MISO’s aim to improve reliability. For Load Control and Industrial members, the daily must offer requirements would almost certainly be more burdensome than any financial compensation they would receive for reducing load during infrequent emergency events. The Respondents aren’t sure if these member programs and tariffed rates would continue to participate in MISO’s market at all with the added overhead required to be a DRR in the Energy markets.
One other item that should be considered is that the 1MW requirement for DRR should be lowered if an LMR decides to change its registration. The Respondents currently have a few generators that are below the 1MW threshold which would make them ineligible to become DRRs. MISO should consider lowering this threshold to ensure that these resources aren’t prohibited from modifying their registration to still participate in the MISO markets.
Obligation to Respond
The Respondents do not take issue with having to respond to all events in which MISO needs capacity to maintain system reliability with the caveat that the tools necessary to report the availability (DSRI) should be flexible enough to account for seasonal variation in the ability to reduce load. Many of the Respondents load modifying programs include members with seasonal variation such as A/C units and irrigation pumps, so those loads will not be available in certain seasons and it’s important that MISO give members the tools to properly report the actual availability of LMRs.
Proposed Audit, Testing, and Penalty Provisions
The Respondents believe that MISO’s proposal to require two unannounced test events per season (8 events per year) is an impactful change that would be a significant deterrent to demand response participants. Most programs currently only test once per year at most and industrial members will opt out of demand response programs if forced to test so frequently. The Respondents understand the goal of testing, but this goal could be achieved with something more reasonable, like two events per year or, at maximum, one event per season (4 per year).
Conclusion
The Respondents understand that MISO wants more certainty surrounding their portfolio of LMRs but believes MISO’s proposal would make it infeasible for most LMRs to continue participating in the MISO markets. Should MISO move forward with their current proposal, it will almost certainly raise the cost of serving customers in the footprint in a very meaningful way with both higher market prices for current resources and the added expense of building new resources to replace the LMR capacity that is being evicted from the system. The Respondents would encourage MISO to find a middle ground such as a 2-hour notification threshold and more frequent testing than is happening today but less than the proposed two random tests per season. The Respondents believe LMRs do provide value to the system and want to work with MISO to ensure that these resources are available when they’re needed but the current proposal moves too far in a direction that will allow existing LMRs to continue to participate in the MISO footprint.
Association of Businesses Advocating Tariff Equity (ABATE), Illinois Industrial Energy Consumers (IIEC), Louisiana Energy Users Group (LEUG), Texas Industrial Energy Consumers (TIEC),
Coalition of MISO Transmission Customers (CMTC), Midwest Industrial Customers (MIC) and Midwest Large Energy Consumers (MLEC), as representatives of the End-Use Customer (EUC) Sector, and NISPCO Large Customer Group (NLCG), a MISO stakeholder, have submitted joint comments to MISO. Due to the length of the joint comments (16 pages), the EUC Sector has submitted the joint comments to MISO Stakeholder Relations on the form of an Adobe PDF file. The Adobe PDF file should be accessible under "Supplemental Stakeholder Feeback" once MISO Stakeholder Relations has a chance to post it.
Questions regarding the joint EUC Sector comments can be directed to any of the following representatives:
Jim Dauphinais
Brubaker & Associates, Inc.
(Consultants to ABATE, IIEC, LEUG, NLCG and TIEC)
(636) 898-6725
Ali Al-Jabir
Brubaker & Associates, Inc.
(Consultants to ABATE, IIEC, LEUG, NLCG and TIEC)
(361) 994-1767
Ken Stark
McNees Wallace & Nurick LLC (for CMTC)
(717) 237-5378
Kavita Maini
KM Energy Consulting, LLC (Consultants to MLEC and MIC)
(262) 646-3981
Enel X Comments to MISO Regarding Proposed Reforms to Load Modifying Resource Construct Presented on April 17, 2024 to the RASC
Enel X appreciates the opportunity to provide feedback to MISO on their proposed LMR changes. Enel X has provided feedback below on each of the 5 proposals presented during the April RASC meeting. Additionally, Enel X is in support of other Market Participants' comments, such as C-Power, that align with the themes laid out here.
MISO Proposal 1: Move to decrease notification time to 30-minute prior to event
Enel X Feedback: Current notification windows for LMRs are confusing for MPs, with less than 2 hrs, 2-6hrs and 6-12 hours available for selection in MECT. Decreasing notification time to 30-mintues prior to an event, and eliminating optionality, would drastically reduce the amount of available capacity to participate as LMRs. MISO has not adequately indicated why changing to a 30-minute notification is needed for operational or reliability reasons and why the current notification periods are insufficient to meet its reliability needs. In addition, if customers have operational reasons, for safety or process, that cannot be curtailed within 30 minutes, MISO should be able to accommodate those concerns, as other markets have and as other resource types have been accommodated (e.g. long, lead-time generators). Having the ability to “layer in” resources with different operating characteristics and dispatch notifications can provide MISO with more flexibility to address system conditions, including the ability to not dispatch resources with short dispatch triggers if not needed, as conditions improve. One option would be to make 2hrs the default lead-time, and provide incentives for 30-min and 60-min lead-times if there are operational characteristics that allow a faster response.
Additionally, a 30-minute notification period for the LMR program seems to duplicate the existing rapid-response demand response programs, such as Operating Reserve resources. Is MISO going to be treating DR as a reserve resource versus a capacity resource that is available for dispatch under specific conditions? By providing distinct notification lead times (ex: 6 hrs, 2 hrs, 60 min, 30 min) MISO can have transparency into the portfolio and flexibility to respond to different types of system conditions. Overall, imposing a blanket reduction in notification time would be counter to MISO’s goal of procuring additional resources to respond in emergency grid conditions.
MISO Proposal 2: Require MP, LSE & LBA to work together to submit addresses and EPNode information
Enel X Feedback: The current EPNode/CPNode discovery process is heavily dependent upon discussions with the LSE/LBA, which is inefficient and time-consuming. There is no central repository for EPNode and CPNode information is stored among the MP, LSE and LBAs. This process appears to place strain on the registration teams within the LBAs, as it is clearly a difficult, time-consuming back-and-forth effort for them. There is no standard process with LBAs/LSEs to receive this data, which places undue burden on the MPs. Additionally, Enel X encourages MISO to allow LMR aggregations to map to the largest available region. If there are hyper-local reliability concerns, MISO should avoid mapping registrations to granular areas.
Making Node identification a MISO responsibility would create a more efficient process. Alternatively, Market Participants could self-serve CPNode and EPNode information if it were made readily and easily available.
Any improvement that can be made to reduce the reliance upon email within the registration process between LSE/LBA/MP would greatly improve the integrity and efficiency of the process.
MISO Proposal 3: LMRs will be obligated to perform during any emergency when called upon
Enel X Feedback: MISO historically has dispatched LMRs 0-2 times per year in MISO Central/North, and the current program design allowing for 16 emergency dispatches is likely sufficient to meet MISO needs. However, Enel X understands the need to ensure that the LMR resource is available during all future grid emergencies, especially as MISO enters a more complex operating environment.
MISO Proposal 4: Revised audit, testing, and penalty provisions to minimize gaming opportunities
Enel X Feedback: The purpose of an audit is to validate that resources will respond when required; the current market rules are generally sufficient for this. However, Enel X supports the effort to align market rules to eliminate the opportunity for Market Participants to engage in ‘gaming’ activities.
MISO needs to be mindful that any audit, testing or penalty provisions do not make the market untenable for the demand response assets that provide capacity. The current MISO proposal will increase risk, increase cost of participation and will not necessarily guarantee LMR performance during emergencies.
Any efforts to reform the penalty provisions for DR should also review penalty provisions for other types of resources, including fossil generation; currently, DR resources risk market disqualification of an entire portfolio for anything less than 100% performance, which is far more stringent than what other resources face. Additionally, steep penalty increases with no additional incentives for MPs does not create a path for MISO to gain more capacity to meet their future resource adequacy needs.
The data submission revisions proposed by MISO will require significant resources from Market Participants and MISO. The proposal (only 30 days) does not provide enough time for Market Participants to do adequate data quality review, and would require costly build out of data acquisition and submission tools. MISO would also need to invest resources to ingest data via API or another automated method given the high frequency of data submission. Other markets with products similar to LMR have adopted data submission standards that allow MPs more time and have discrete settlement deadlines instead of rolling daily submissions. Enel X also recommends that MISO provide greater clarification on data quality requirements.
The testing framework laid out by MISO is too frequent and will not make the LMR resources more reliable. MISO has sufficient opportunities to assess LMRs between the registration data, proposed audit requirement and emergency dispatch performance. The significant increase in testing, paired with unlimited emergency dispatches, drastically changes the cost of participating in the program. There are also several important factors that need to be included as the testing framework continues to be developed, including: establishing testing pass thresholds, how LMR resources will be measured (against DSRI availability or registered kW), and whether a test payment will be provided. LMR resources have no means to receive energy payments unless dual enrolled, and this testing framework generates a significant amount of risk for MPs with no additional upside.
MISO Proposal 5: Accreditation will be based on availability & type of LMR selected at the time of registration - under development, proposal will be presented at the May RASC meeting
Enel X Feedback: Enel X looks forward to engaging with MISO to create a streamlined and effective process for LMR accreditation. Among others, Enel X hopes MISO will consider factors such as ease of data access, clearly defined roles between MISO/LSE/LBA/MP, and accounting for different LMR characteristics when designing the accreditation process.
The OMS Resources and DER Work Groups (OMS WGs) appreciate this opportunity to provide feedback on the various design elements contained in the Load Modifying Resource (LMR) reform proposal that MISO presented at the April 17, 2024 Resource Adequacy Subcommittee (RASC) meeting. This feedback is from multiple OMS work groups and does not represent a position of the OMS Board of Directors.
Response to MISO’s LMR Proposal
The OMS WGs appreciate and understand the objective of MISO operations to have a more responsive and reliable emergency toolkit, but the OMS WGs have significant concerns with the specific, drastic changes MISO is proposing to make at this stage. During the RASC meeting, multiple stakeholders stated that MISO’s reforms would result in the loss of participation by many of the resources that participate as LMRs currently. Unless MISO’s objective is to drive these resources and their contribution to reliability out of the market, MISO needs to step back and reassess its proposal. Before making further modifications to this proposal, however, the OMS WGs propose that MISO explore what alternative participation models could practically work for the existing LMRs that need longer lead times and for which the DRR Type I participation model is impractical. Incorporating the findings from this exploration into a more holistic reform package will be essential to get broader stakeholder buy-in of the proposal.
The potential loss of a majority of the 12 GW of LMRs currently on the system at a time where the MISO region is experiencing tightening capacity conditions is unacceptable without a comprehensive plan for how those resources will be able to participate elsewhere in the market. To be clear, the OMS WGs support MISO’s objectives of giving MISO operators the tools they need to reliably manage the system through tightening LMR notification and availability rules, exploring higher penalties, considering more stringent accreditation approaches, ensuring LMRs are reliable when called upon, minimizing gaming opportunities, and being able to access demand response resources outside of emergency procedures. However, the OMS WGs stress that these changes should be accomplished through a measured approach to avoid driving resources out of the market at a time when reserve margins are tightening.
The OMS WGs would like to request that MISO explore the following options:
1.) MISO should explore a proposal that starts with a 2-hour notification time as the upper bound of LMR accredited value, similar to the changes previously made in 2019 and as presented at the November 2023 RASC. This approach would move LMR requirements in a similar direction to the 30-minute proposal and would still allow resources with longer lead times to participate in the market. Accreditation values of LMRs could also be shifted based on MISO’s operational needs and quantitative evidence of necessary notification time.
2.) MISO should explore segmenting the LMR product category into two distinct products. If MISO’s focus is on accessing emergency resources in a timely, reliable manner, a different product could target some of the existing LMRs (particularly those with lead times longer than two hours) to have them be accessible outside of emergency conditions. Discussion around this topic would include what level of capacity credit is appropriate or if an alternative compensation mechanism should be considered. Exploration of this option should include an analysis of the gaps and differences between the existing LMR product today and the DRR Type I product. Changes to the LMR product category should include an analysis of whether compensation for those resources should change as well.
We are interested in MISO exploring participation options for LMRs with longer lead times, including lead times over two hours, outside of emergencies as these resources still have value. Owners of such resources may find being called upon often disruptive and would find it more feasible to have participation option where they could be called upon in just a few instances each year at a compensation level that would justify their participation.
Additionally, the OMS WGs appreciate MISO scheduling a Demand Response 101 Workshop on May 10, 2024. Stakeholders would benefit from a presentation on the current participation options, the level of participation within those options, the potential product changes, and tying together ongoing discussions on LMR and DRR – Type I reforms. Additional workshops may be necessary as proposals develop to ensure all reforms are being evaluated comprehensively.
Notification Time Questions and Feedback
The OMS WGs support revising the maximum allowed LMR notification time to less than the currently allowed 6 hours (or reducing accreditation for resources with longer lead times as proposed at the November 2023 RASC meeting),[1] but have multiple questions about moving to 30 minutes:
Testing Questions and Feedback
The OMS WGs agree with stakeholder concern expressed at the RASC that requiring “at least 2” real power tests every season for every LMR will result in a significant loss of the associated capacity. While real power tests of some LMRs could be feasible, the impact of such a test is not the same for residential vs. industrial customers. The OMS WGs support measures to ensure LMRs are reliable emergency resources, but MISO should explore whether other types of testing, combined with an appropriate penalty structure, would achieve a similar level of certainty that LMRs will be able to perform. The OMS WGs agree that real power testing is an ideal way to determine a resource’s availability. However, the impact on the customer must be taken into account. MISO should also consider ways to compensate customers, particularly customers that are highly impacted, for the burden of conducting a real power test.
In addition, splitting the LMR product category into multiple products, as suggested above, would allow testing requirements to also be split based on what product the resource is registered for. Such product changes, including the current proposal, should also include an assessment of whether the compensation for that product needs to change as well.
Number of Calls Questions and Feedback
The OMS WGs request that MISO provide additional information on why the current number of calls each season is insufficient to ensure that LMRs are providing the reliability contribution they are being compensated for. MISO has increased the number of calls LMRs are expected to be available for multiple times, most recently with the change to the seasonal construct that requires up to five calls in the summer and winter seasons and up to three calls in the fall and spring seasons. That means that an LMR that clears all seasons in the Planning Resource Auction could be called up to 16 times over the course of a Planning Year. Assuming MISO keeps LMRs in the emergency stack, that would mean that the MISO footprint had to reach an Energy Emergency Alert (EEA) 2 significantly more frequently than it ever has to burn through the current number of calls LMRs have to be available for.
Implementation Timeline Feedback
MISO should reconsider its implementation timeline to allow the opportunity to fully understand the various reforms proposed.
[1] https://cdn.misoenergy.org/20231107-08%20RASC%20Item%2011aii%20LMR%20Accreditation%20(RASC-2019-9)630751.pdf
CPower Comments to MISO Regarding Market Redefinition: Accreditation Reforms for Load Modifying Resources Presented on April 17, 2024 to the MSC (RASC-2019-9)
May 3, 2024
During the April 17, 2024 MSC meeting, MISO presented its revised proposal for changes to Load Modifying Resources (“LMR”) participating in MISO’s markets. Enerwise Global Technologies, LLC d/b/a CPower (“CPower”) appreciates the opportunity to provide feedback to MISO on these issues. CPower thanks MISO staff for their review and consideration of the feedback below. Should you have any questions, please do not hesitate to contact Peter Dotson-Westphalen.
MISO requested stakeholder feedback on the proposed design elements, including the notification time, obligation to respond to respond during each season, and proposed revisions to audit, testing, and penalty provisions for LMRs. MISO also requested stakeholders provide operating characteristics of LMRs that MISO should consider while developing accreditation rules.
Proposed Design Element Feedback
Notification Time
MISO’s proposal to reduce the notification time from the current range allowed of two to six hours to just 30 minutes. While CPower understands the need for MISO operators to be able to call upon emergency resources to address emergency conditions, limiting the notification time to 30-min to respond will likely result in significant attrition of valuable resources that contribute to Resource Adequacy and have proven valuable in helping to maintain reliability on MISO’s system. Should MISO move forward with implementing a 30-min option for LMRs, it should retain the ability for customers that have valid, demonstrable reasons why they require a notification time longer than 30-minutes to participate.
MISO could consider whether these longer lead time LMRs capacity accreditation may be impacted but reducing the notification time to 30-minutes only will serve to drive willing and capable participants out of the market. If there are capacity accreditation incentives to reduce the notification lead time associated with the resource in the form of receiving a higher percentage of the available capacity credit, this approach may help to drive customer adoption of technologies to help automate their load reduction strategies and measures.
Obligation to Respond to MISO Scheduling Instructions for Each Season
CPower does not necessarily oppose MISO’s proposal to remove the current Seasonal limits for LMRs to be required to respond during MISO emergencies. However, as discussed later in the Testing section of these comment, MISO should consider mechanisms to provide energy payments to dispatched LMRs that do not require dual registration as an EDR or DRR.
Proposed Audit, Test, and Penalty Provisions
MISO’s proposed changes to its audit, testing and penalty provisions for LMRs include:
Meter Data Submission and Audit Provisions Comments:
While CPower recognizes and supports the need for visibility into resource availability, we caution against requiring ongoing meter data submission with similar reasons as we noted in our comments submitted on May 2, 2024 to the MSC’s Demand Response Participating as a Supply Resource in MISO Markets.[1] MISO should consider the system changes required to accept data submitted by MPs representing LMRs, and the functionality to automate review and audit of this data. MISO should also recognize the additional burdens ongoing submission of such data will require for MPs.
MISO should also consider whether this data submission requirement should apply to LMRs that utilize a DLC or Custom Baselines that utilize a sampling methodology. These measurement and verification do so often to simplify the settlement process and limit the meter data that must be obtained, analyzed, and submitted in association with the resource’s participation. M
Additionally, should MISO move forward with requiring ongoing meter data submissions it should:
Testing Comments:
MISO’s proposal for administering at least two random tests of each LMR in each Season is untenable and will lead to large-scale attrition from the program if implemented. Requiring resources to test a minimum of 8 times per year far exceeds the standards of any demand response program administered in the country. Coupled with the proposed test frequency, the lack of compensation for the energy provided when participating solely as a LMR makes this proposal unworkable. Customers that agree to participate as LMRs do so for a variety of reasons, but a primary one is to support grid reliability. Customers disrupt their normal operations and energy consumption to provide this vital grid service, but capacity compensation alone will not compensate for the inconvenience or lost opportunity cost of testing at least two times per season, or at least 8 times per year (when participating in all Seasons).
CPower supports the need MISO has in validating that the resource can and will be able to be delivered during system emergencies. However, we suggest the following revisions for consideration to MISO’s proposal:
Additionally, CPower would like for MISO to clarify how these changes relate to LMR accreditation, both under the existing and proposed accreditation constructs for LMRs.
Penalty Comments:
MISO’s proposal for penalty provisions for LMRs associated with failure to perform during the proposed random tests or events could stand to benefit from further clarification and revision. A warning is appropriate for failure to perform during a first test and allows the MPs and customers participating in the LMRs to make any adjustments needed to be ready to respond during emergencies. As proposed in our comments above regarding testing provisions, MISO could seek to call a second test within a Season only if an LMR failed the first test. Forfeiture of capacity payments for the Season is appropriate following the failure of a second test within a Season.
MISO proposes to disqualify LMRs for the remainder of the Season and PY, as well as from the following three PYs should they fail to perform in two tests or events during a Season. While disqualification for the Season, or even the remainder of the PY may be appropriate (presuming the failures were not due to reasons considered to be force majeure), disqualification from participation in future PYs is not appropriate. Should such failures occur and the resource is able to demonstrate in subsequent retesting (or through qualification testing as is used currently for accreditation of LMRs) that it is capable of responding, these resources should be able to resume participating in the following PY.
MISO also noted that individual accounts within an LMR that experience two failures within a Season would also be disqualified from future participation. This goes against the spirit of aggregated resources, and should not be adopted moving forward. The MP/LMR asset owner should retain the ability to aggregate customers into resources that will be able to deliver on the obligations associated with the resource. If any one customer isn’t able to curtail while the resource as a whole performs (in either a test or an event), that does not mean MISO may prohibit that individual customer from participating as part of the aggregated resource.
CPower would like to better understand if the proposed penalty structure would replace or be in addition to the current penalty structure for under-/non-performance during LMR events, where the penalty amount is calculated as the shortfall observed multiplied by the LMP for each event hour where a shortfall has been observed (with the 3x multiplier if the LMR opted out of demonstrating its load reduction capability during the prior calendar year).
Additional Feedback
Accreditation:
MISO requested feedback on operating characteristics of LMRs that should be considered by MISO when developing its accreditation rules. Characteristics such as time of day that factor into when participating customers are using electricity that they are willing to, and have the flexibility to reduce in response to system emergencies, temperature dependency for customers that leverage HVAC temperature setpoint adjustments to achieve load reductions, as well as varying operating/production schedules for commercial and industrial customers.
Other Items:
As referenced in CPower’s MSC Feedback, as well as prior feedback requests pertaining to LMRs, as MISO works on overall market design and process improvements relating to LMRs, as well as other demand response participation options, it should seek to enhance and align its systems for demand resource registration to participate as LMRs, EDRs, and DRRs, and eliminate manual processes and utilizing email with excel spreadsheets attached to facilitate the registration review process. MISO should also revisit the rules and processes relating to how it handles instances of duplicate registrations submitted by more than one MP for the same customer account.
Additionally, CPower recommends the MISO revisit and align any future program rule changes to prevent disparate methods for measuring performance during tests (for accreditation, or for performance verification) and events from coexisting. For example, the current testing practices to inform accreditation essentially utilize a form of an energy baseline (“meter before – meter after”) to judge how much load a customer is capable of reducing that will then be eligible (with room for scaling performance to Seasonal peaks as well as other adjustments as appropriate) to be registered. Neither the Calculated Baseline, nor the Firm Service Level, utilize the same methodology as the test methodology, which can create additional confusion when educating prospective and existing customers on the rules for participation, as well as how they are expected to participate. Aligning these methodologies will help to remove such confusion.
Conclusion
CPower appreciates the opportunity to comment and looks forward to further discussion of this topic in the stakeholder process.
Respectfully,
Peter Dotson-Westphalen
Sr. Director, Regulatory & Government Affairs
CPower
Peter.D.Westphalen@CPowerEnergyManagement.com
781-214-7523
[1] Available at: https://www.misoenergy.org/engage/stakeholder-feedback/2024/msc-demand-response-participating-as-a-supply-resource-in-miso-markets-20240418/#accordion8. (“MSC Feedback”)
Voltus comments to RASC on RASC: Accreditation Reforms for LMRs (RASC-2019-9) (20240417)
May 3rd, 2024
Voltus appreciates the opportunity to submit these comments on proposed changes to LMR accreditation. As the first and largest aggregator of retail customers (ARC) in the MISO market, Voltus serves a portfolio of customers that is geographically diverse across the MISO footprint and includes over 500 MW of residential, commercial, and industrial demand response assets registered as LMRs. We have participated in the LMR program since 2017, and have witnessed significant changes in that time to how LMRs are enrolled, accredited, measured, dispatched and settled. MISO’s proposal as presented to the RASC on April 17th, 2024 would represent the most drastic changes to the LMR instrument since our entry into MISO’s program.
MISO presented to the RASC a few major challenges that exist with the LMR instrument today for MISO operators: Firstly, it is difficult to access LMRs due to the prerequisite that an EEA2 be active or imminent prior to LMR deployment; Secondly, MISO anticipates that sub-hourly response of capacity resources is likely necessary to address future MISO system emergencies, yet LMRs may currently receive full accreditation with a six-hour response time; finally, MISO does not today have the level of certainty necessary to reliably predict the MW of relief provided by the deployment of LMRs.
Voltus is sympathetic to the challenges raised by MISO and supports its efforts to ensure that grid operators have the right tools at their disposal for keeping lights on. With that said, Voltus does encourage MISO to further examine that its proposed LMR changes do not unnecessarily exclude demand response assets that can provide reliability benefits.
Voltus offers the following feedback in response to MISO’s stated challenges and proposed solutions:
Notification Time
MISO operators have indicated that a 30-minute demand response product is necessary to provide the capacity benefit that they require in future anticipated EEA-2 conditions. Voltus supports MISO’s efforts to modify the LMR product to match the needs of grid operators. Accordingly, we support a move to 30-minute response time as the default for full capacity accreditation of LMRs. However, rather than disqualifying any resource that cannot respond in 30 minutes, MISO should accredit those LMRs that require a longer notification time proportionally to the reliability benefits they add to MISO’s system.
Voltus encourages MISO to consider replicating PJM’s Emergency Load Response Program (ELRP) as an effective demand response capacity program. Voltus currently has hundreds of MW registered in ELRP and is witness to the program’s efficacy, especially for large aggregations of DR assets. In particular, ELRP requires assets to be capable of responding within 30 minutes, as MISO has indicated it needs. By design, the program recognizes that some underlying customers may be faster or slower to respond and accordingly, performance is aggregated on an LBA-basis. Voltus monitors most of its registered loads through real-time telemetry and calculates performance as events are ongoing - this allows us to reach out to potential over-performers for additional curtailment if we see another customer is underperforming. In the absence of ELRP’s aggregation rules, there would be no incentive to do this. Additionally, deployed ELRP resources are provided energy payment for their performance per FERC Order 745, increasing customer incentive for full performance in each event.
Lastly, ELRP’s testing requirements involve a single, two-hour test annually, for which market participants receive advanced notification including a two-week window where the test is possible, and day-ahead notice that the test will be the next day. Assets then receive test deployments in line with their registered notification timing. Similar to true market events, PJM tests all assets in a given LBA simultaneously, and performance is aggregated at the same level.
By replicating the PJM ELRP program which has been proven to be effective and reliable, MISO would be establishing a 30-minute demand response capacity product that satisfies its needs, would fairly measure event performance, and would shift the market towards a more standardized approach with our neighboring territory.
However, Voltus does question the idea that a 45-minute LMR, for example, has no capacity benefit whatsoever. On occasions similar to 8/24/23, where real-time conditions resulted in MISO’s declaration of EEA2 conditions for HE 16 at 8am CT, even a 6-hour LMR would have provided more reliability benefits to MISO’s system than, for example, a DRR that did not clear its offer in the day-ahead market. Instead, MISO should accredit LMRs with longer notification timing according to the frequency with which they are likely to be deployed relative to a 30-minute-response LMR. A sliding scale of capacity accreditation, similar to that which was proposed at the November 2023 RASC, would accomplish this.
To determine this accreditation scale, MISO should demonstrate to stakeholders the proportion of instances that longer-notification-time LMRs would be able to provide reliability benefits versus a base LMR with a notification timing of 30 minutes. It is then reasonable for LMRs with longer notification timing to receive reduced accreditation in line with this proportion. This will allow MISO to maintain emergency assets with longer notification timing while providing appropriate compensation for the reliability benefits that they bring.
Voltus notes that MISO has proposed that existing LMR assets that are unable to participate in a 30-minute program may instead participate as a Planning Resource and/or in MISO’s markets as a DRR. However, this notion is flawed - the DRR instrument does not offer many of the aspects that make participation as an LMR viable for these facilities in the first place.
Primarily, the DRR instrument does not require that MISO’s system be in a state of emergency prior to commitment. For many end-use facilities, the ability to curtail is limited to emergency situations - they are able to provide relief in the form of curtailment to the MISO system in order to help preserve system reliability and protect against involuntary load shedding, but are unable to provide curtailment for purely economic reasons. This is not the structure of the DRR instrument, which only offers resources the ability to be deployed for energy in response to an economic signal.
Secondarily, the DRR instrument does not offer the ability for loads to utilize a Firm Service Level baseline. For facilities that have a base load that must be maintained even during curtailed operations, this is by far the best way for them to participate in curtailment and reliably demonstrate how much load they will carry during emergency conditions to MISO.
Thirdly, the process behind capacity accreditation for DRRs is currently ambiguous and not well described in the MISO tariff or BPMs, especially when compared to that of LMRs. BPM 011 does spell out how DRRs backed by behind-the-meter-generation may pursue accreditation, but is very light on details for registration of DRRs that simply participate via load interruption. By contrast, BPM 011 dedicates large sections to guidelines for LMR enrollment.
Finally, the DRR registration process is much more cumbersome than the LMR registration process, requiring model change requests to be submitted by MPs, requiring massive effort even for minor Enrollment changes between seasons, and forcing MPs to interact with a much less friendly interface for the enrollment of resources. To address this, the DRT would need to be improved to enable bulk uploads of data, simplify the creation of Model Change Requests, and provide streamlined tracking of enrollment reviews and approvals.
Obligation to respond to MISO instructions for each season
MISO’s proposal to require LMRs to respond to each scheduling instruction issued during EEA2 events is reasonable. However, MISO should recognize that facilities comprising LMR assets may not be willing or able to curtail an unlimited number of times within a given season due to production constraints. To this end, MISO should allow resources to specify a cap on the number of times they receive Scheduling Instructions within a given season, and provide a de-rate to capacity accreditation according to that number. As an arbitrary example, MISO could stipulate that resources that can only curtail the first 5 times may receive, say, 75% capacity accreditation, resources that can respond the first 10 times may receive 90% capacity, and no cap above 10 may be specified. This example is purely illustrative, and MISO should determine actual accreditation proportions related to assets with varying caps on deployments based on the projected reliability benefit to the system.
Proposed audit, testing, and penalty provisions
MISO is proposing that meter data for LMRs must be submitted within 30 days of any Operating Day, and that meter data will be used to validate availability submitted in the DSRI. Voltus supports enhancement of MISO’s ability to audit historical availability to ensure market participants are accurately inputting availability to the DSRI. However, there is a large administrative burden associated with gathering, verifying, and submitting data to MISO, particularly for ARCs who must first obtain that data from relevant LBAs. ARCs have no control over how quickly LBAs may provide needed meter data, and each LBA has its own unique process for those requests. Voltus requests clarification from MISO on the need for the acceleration of the data submission deadline from 103 days to 30 days. If a faster data submission timeline is necessary, MISO should specify that LBAs must provide data to ARCs related to LMR performance in a reasonable timeline, i.e., no later than 15 days from any Operating Day.
Voltus does not support MISO’s proposal to perform a minimum of two random tests for each LMR each season. As stated previously, many of the facilities that underlie LMR assets participate in order to provide relief to MISOs system and protect their own operations against involuntary load shedding when emergency conditions arise. As such, it is uneconomic for them to curtail for multiple tests each season. Rather than participate in up to 8 tests per year that will result in no incremental compensation, many of these facilities will choose not to participate whatsoever. Finally, emergency assets are likely to be on high alert during tight grid conditions and are accordingly prepared for deployment. Random testing without any advance notice during non-emergency hours will likely produce weaker results than a real emergency deployment, and this could unfairly penalize assets that would provide true reliability benefits in line with the LMR product’s purpose.
Instead of a drastic modification to testing protocols, MISO should proceed with empowering itself to randomly audit availability using meter data. As LMR assets are relied upon more often in emergency situations due to the proliferation of intermittent resources and changing weather patterns, the risk of disqualification due to underperformance in a true market event will grow, and the associated penalties will remain highly punitive. Voltus believes that this risk, along with the risk of failing a random audit, will be sufficient incentive for MPs to maintain accurate availability and ensure their LMRs are accurately enrolled and reliable assets.
LMR Operating Characteristics
Voltus's LMRs range from single, large industrial facilities, to aggregations of dozens of commercial buildings, to 5,000+ residential customers. We operate aggregated assets that provide comparable grid services to generation assets, providing energy, capacity, and ancillary services to MISO’s system. Each of these has complex factors that affect how they might best provide capacity to MISO's system. For example, some of these assets are capable of providing energy to MISO on short notice on a daily cadence. However, others require more advanced notification and may only be available during emergency conditions.
Conclusion
Voltus appreciates MISO’s efforts to address this very complex issue and we are supportive of MISO’s position that resources should only be accredited when they provide a reliability benefit. Voltus supports MISO’s proposal to adjust the standard LMR response time to 30 minutes in order to receive full capacity accreditation. However, we disagree that 30 minutes is the only time frame threshold for reliability. Instead, we propose that MISO should institute a sliding scale for LMR accreditation that allows MISO to retain access to these resources while compensating them according to the relative benefit they provide.
Additionally, Voltus believes that MISO should avoid making drastic adjustments to program participation parameters that will result in major attrition of reliable planning resources. Instead, we propose that MISO should take reasonable steps, such as instituting a sliding scale for the number of events and utilizing meter data to validate availability, that will move MISO towards stated goals while maintaining high levels of LMR participation in providing reliability to MISO’s markets.
Respectfully Submitted,
Sean Shafer
Senior Energy Markets Analyst
Voltus, Inc.
sshafer@voltus.co
Comments on MISO Proposal for LMR Reforms (RASC-2019-9)
Submitted by Thomas Siegrist, SMXB Consulting Engineer
As part of the April 17, 2024, MISO RASC meeting, MISO requested feedback on its proposal for Load Modifying Resource (“LMRs”) reforms. Our firm works with several industrial customers in the MISO footprint that act as LMRs. Based on our experience, we offer the following initial comments and concerns.
MISO specifically requests feedback on the following Proposed Design Elements:
Notification Time
MISO proposes to restrict all LMR notification times to “30 minutes or less.” MISO’s proposal is unnecessary and not justified at this time. MISO just moved to the current 6-hour or less notice requirement for LMRs effective October 2023. At a minimum, the status quo for LMR notice should be maintained until all of MISO’s recent changes to LMR participation in MISO have been fully implemented and the impacts thereof become fully known.
Many long-standing LMRs are businesses and/or industrial customers that produce something other than demand response, and demand response participation is merely a secondary effort by these LMR participants to reduce their operating costs. Frequent changes to LMR rules, additional costly and unnecessary efforts, and adverse impacts on manufacturing operations and safety, are disincentives to, and negatively impact, continued effective participation.
Moreover, all LMRs with notification times of 6 hours or less provide value in terms of MISO reliability. MISO can call on such LMRs in anticipation of an EEA2 event, and such LMRs have provided relief to MISO’s system and/or allowed MISO to avoid an emergency event altogether.[1] If such resources are disqualified from being LMRs because the customers cannot comply with a shorter notification requirement, MISO, Market Participants, and the respective LMRs will lose related benefits, resulting in a lose-lose-lose situation.
Importantly, LMRs are primarily Planning Resources, i.e., resources used to achieve long-term Resource Adequacy. Their main purpose does not include serving as Operating Reserves and LMRs should not be required to meet the qualifications of such. If MISO operators need resources with such attributes, MISO should develop new and different products.
Obligation to Respond to MISO Instructions for Each Season
MISO proposes to require LMRs to perform during any emergency when called upon, without limitation in number. Such a proposed change is of concern, and MISO has not presented any studies that support the need for such a change for LMRs. Interruption of LMRs must be necessitated by narrowly defined, identifiable and verifiable pre-emergency and/or emergency circumstances. If curtailment requests and/or scheduling instructions become too frequent or questionable in nature, continued customer participation as an LMR must be reevaluated in light of the operational and economic impacts thereof. Hourly limitations are important to give customers, particularly businesses and industry, an idea of what to plan around. The possibility of numerous and frequent interruptions will lead to a loss of participation in the program. Again, MISO should develop new products to address MISO’s needs and LMRs’ operational realities.
Proposed Audit, Testing, and Penalty Provisions
MISO proposes revised audit, testing, and penalty provisions to purportedly minimize gaming opportunities. MISO’s respective proposals cast too wide a net and are at best impractical and at worst draconian. MISO’s enhanced audit consists of availability being “submitted in DSRI” and validated using meter data, temperature data, and other data sources as LMR performance dictates.”
As stated in previous feedback to the MISO RASC, MISO’s Demand Side Resource Interface (“DSRI”) Tool, in its current format should not be used to audit/track LMR availability for LMRs that drop load down to a specific Firm Service Level (“FSL”). FSL LMRs are often industrial customers that utilize batch processes, whose load cannot be forecasted with precision on an hour-by-hour basis. Many LMRs take interruptible retail service that is not based on a specified amount of load reduction, but instead is predicated upon the LMR load dropping down to a specific FSL, regardless of their actual load level when notified to reduce load. As also stated in previous feedback to the MISO RASC, if the LMR drops down to its FSL, and stays there for the requested duration, then the LMR should be regarded as 100% available and compliant. The DSRI Tool in its present format is simply not a reliable or accurate mechanism by which to monitor the MWs available to MISO from FSL LMRs.[2]
If, despite these considerations, MISO is determined to further explore the potential use of the DSRI Tool for operational purposes related to these FSL LMRs, then at the outset, further discussion of MISO’s proposed additional fields for the DSRI Tool is needed. For example, as most recently described by MISO, the existing and new fields in the DSRI Tool are not clear as to whether they would accurately reflect an LMR’s potential hourly load, particularly LMR batch load that could reduce or increase load on the system in any given hour. At a minimum, an example of the DSRI Tool for an FSL LMR is needed, including narrative descriptions of each applicable field in the DSRI tool.[3]
Next, MISO proposes to perform random testing for each LMR every season, with at least 2 tests per season. Subsequent tests may depend on findings from the first 2 tests. Such an approach is unnecessary, unworkable, and unacceptable for many LMRs that are businesses and/or industrial customers that produce something other than demand response. For example, an FSL LMR that is not temperature variable and whose industrial process does not significantly vary season-to-season does not need to be tested in multiple seasons. The current one-test-per-year standard is sufficient for such a resource. In fact, barring an operational change in its respective process, that single test may be sufficient for multiple years. The only question that needs to be answered is whether the LMR can get down to its FSL. Once it has proven it can do so, it should not be required to do so again and again. Testing causes unnecessary and unwelcome operational issues and economic losses.[4] If MISO intends to rid FSL LMRs from the ranks of its Planning Resources, multiple random testing will be one of the surest ways of doing so.
Lastly, MISO proposes penalty provisions that would be applied if an LMR fails to perform during a test and/or emergency event. The penalties, as presently presented by MISO, do not define what qualifies as a “failure”. For example:
MISO and/or IMM discretion should be allowed, with clawback of capacity payments and/or disqualification of an LMR from PRAs being utilized in only the most egregious of circumstances.
[1] Notably, ensuring that load increases do not materialize is just as important as load reductions at times when the system is stressed.
[2] MISO Staff should again review the 1/17/23 Presentation to the MISO RASC by Jim Dauphinais of Brubaker & Associates, Inc. on behalf of the End Use Customer Sector, concerning LMR Demand Resources using the FSL Option. Many of the FSL issues discussed in the presentation, which are valued by many LMR stakeholders, have not been reflected in MISO’s proposals going forward. MISO’s failure to accommodate these realities will result in a loss of LMR participation.
[3] If problems with MISO’s DSRI Tool are appropriately remedied, the real time LMR availability reflected by DSRI as compared to the cleared LMR capacity in the PRA will, in all likelihood, converge to a greater extent.
[4] For many, if not all, manufacturers, every hour power is interrupted creates additional hours of lost production due to the time it takes companies to return to full production. MISO has recently recognized this in its revaluation of lost load economics.
Minnesota Power Appreciates the opportunity to provide stakeholder feedback. LMR resources are an important part of the Minnesota Power portfolio. There are several areas of concern with the recently proposed changes to the LMR. The verbal stakeholder responses at the April 17, 2024 RASC were a clear indication of high stakeholder concerns .
The first area of concern is based on the gap of LMR accredited MW compared to the DSRI offered MW. The cause of the gap is not clear, and could be due to a number of issues , including self scheduling LMRs for a variety of conditions. There hasn’t been a demonstrated effort to determine the root causes of the gap. The need for clarity in how to properly report self-scheduled LMRs. Minnesota Power suggests that an audit be performed to provide more clarity on the cause of the gap of the accredited MW and the DSRI entries. This effort could result in the stated goal of operators having a more clear knowledge of the expected LMR resources available.
The second area of concern is MISO proposing the 30 minute notice for all LMR and the difficulty for industrial load LMR to be able to respond in 30 min without unacceptable loss of product. There are numerous examples as were discussed at the RASC meeting such as paper plants where there would be significant product loss with a 30 min notice. Minnesota Power suggests that there be a class of LMR that responds in 30 min that has additional value such as receiving the LMP for providing energy during the event.
The third area of concern is the testing requirement of a select number of LMRs to possibly be tested twice a season. The frequency of potential testing, and the lack of adequate notice during times reiterate the concerns raised regarding the 30 minute notice. Minnesota Power suggests using a testing procedure that demonstrates the communication system performance and using meter data to show the proper DSRI entries for the accreditation
The fourth area of concern is the proposed unlimited number of LMR control periods. LMR customers evaluate the value proposition of interrupting load and resulting reduced costs. LMR consumers have an expected level of net savings, and not locking into a defined number of operations makes it impossible to determine the net savings due to the incremental customer costs of each LMR operation. Customers do not have a means of quantifying the cost impacts of unlimited number of LMR events. The proposed approach puts all the risks on the LMR customer, and doesn’t add any commensurate value. Minnesota Power suggests the current number of events per season be maintained or a proportional amount of additional economic benefit be give to the LMR participant for additional operations.
The fifth area of concern is to suggest a means of providing a leading indicator for emergency conditions before the final EEA2 notice is given. This would provide a greater level of notice for an event, rather than only having a 30 minute notice.
Minnesota Power desires to continue LMR implementation, but is concerned that the impact of the proposed changes could result in a drastic reduction in LMR accredited MW.
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The sixth area of concern for the proposed LMR changes is that stakeholders don’t know how the proposed LMR changes will fit with DLOL methodology for allocating the PRMR by LRZ to individual LSE. The proposed LMR changes is a “bottom up” method to quantify the accredited MW. The DLOL approach is using the LOLE model to quantify the accreditation by generation class and quantify the total PRMR. These approaches cannot “meet in the middle” to somehow include accredited LMR in the DLOL methodology. We cannot just add the LMR accredited MW to the PRMR “later” after the DLOL method is conducted. There is no cohesive final design of including the LMR accredited capacity in conjunction with the DLOL methodology.