Print đź–¨

The Board of Directors of the Electric Reliability Council of Texas met on October 18, 2022, to hear an update from the CEO and updates from ERCOT staff about summer operations. The board also voted on several matters requiring approval. An agenda for the meeting can be found here. An archive of the meeting can be found here.

 

This report is intended to give you an overview and highlight of the various topics taken up. It is not a verbatim transcript of the discussions but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.

 

Item 2: Public Comment, no individuals comment

 

Item 3: Consent Agenda

  • Budget impacts of 8 revisions request discussed, 5 have budgetary impact, SCR A20 $750,000-$1.25 M
  • Motion to approve consent agenda passes

 

Item 4: Board Minutes

  • Draft minutes of August 15 and August 16, 2022 meetings included in meeting materials
  • Motion passes

 

Item 5: CEO Update

  • Vegas discusses looking forward to working with ERCOT
  • Question of how to rebuild trust in ERCOT in the reliability of the grid; through “consistent and successful execution under a variety of scenarios” can secure the trust of the public
  • Highest energy demand record in month of October; grid has withstood tests and passed them this year
  • 100-day priorities:
    • develop a clear remote work policy
    • meet with key stakeholders, including non-traditional groups such as large flexible loads
    • ensure the grid is ready for this winter by implementing and executing new and existing efforts, including both the specifics and intent outlined in Senate Bill 3
  • Updated process calculating PRC to allow full store of battery to be counted; implemented settlement changes to accommodate firm fuel service offering that will be available in November; implemented the fast frequency response ancillary service
  • 1-year priorities:
    • position the grid to respond more effectively and rapidly to emerging technological, economic, and social trends
    • develop and communicate clear milestones for the effective and rapid implementation of Phase 2 market redesign
    • prioritize more innovative thought process and effective system to integrate DEP/intermittent energy sources, use load resources to support the grid
  • offers thanks to employees that have re-organized the online Grid and Market Conditions Dashboard

 

Item 6: Summer 2022 Operational and Market Review

Dan Woodfin

  • June-August 2022 was the second hottest on record for the state, period was also the 39th driest on record, ranks as 5th driest in this century
  • All-time peak demand record of 80,038 MW set on July 20; wind and solar outputs higher than 2021; didn’t have to declare any EEAs
  • New monthly peaks for April, May June, July, August, and October; had two days where a watch was declared
  • Wind generation higher on average in summer 2022 than in summer 2021, similar for solar generation
  • Thermal capacity unavailable due to forced outage was slightly higher 700 MW this summer than the previous summer
  • Amount of wind, solar, demand, and force outage of thermal generators determine tight days
  • Lake- This is at peak correct, which is not necessarily the lowest point of reserves?
    • That’s correct
  • Lake- Difference between gross peak which is highest demand and net peak which is the amount of renewable, key distinction
  • Buying more ancillary services beginning in July 2021, practice is being continued
  • In 2022, more energy storage resources are being used to provide ancillary services compared to last year, providing more for regulation up and responsive reserve

 

Kenan Ogelman

  • Fundamental resources for electricity production saw very high prices due to geopolitical circumstances
  • Use of Reliability Unit Commitment (RUC) is up for 2022; real-time load-weighted hub averages prices in summer 2022 higher than during two previous summers due to increased prices and hotter summer
  • Day-Ahead (DAM) and Real-Time market (RTM) price convergence remained within normal range during summer 2022 except for the tight days previously mentioned; due to unexpected divergence between the markets
  • Ancillary service costs were also higher due to the higher price of energy services in general; also procuring more ancillary services than have in the past
  • Total potential exposure goes up as scarcity increases; credit and collateral increase as prices increase; stakeholders able to meet requirements
  • Need to work to be ready for a generator or a resource bankruptcy; experienced good fortune with QSE that handled bankruptcy and acquiring the resource being the same; legal working to move resources more quickly in case of bankruptcy
  • Woodfin- Are we trying to minimize use of RUC as much as we can? How do we ultimately rely less on RUC?
    • Trying to minimize but not at expense of reliability; not passing up on units if we see a need; multiple initiatives to further minimize, looking at change to not overweigh near time resource in analysis
    • Phase 2 important to close gap between resources stepping forward and ordering them to
  • Woodfin- Should I think about ancillary services the same way?
    • Overlap especially around conservative service operation, more driven by energy price
  • Smati- Did we expect more forced outages this summer compared to last summer?
    • Woodfin- Discussion at beginning of summer that would see higher forced outage rates particularly on the thermal units; saw that one extra unit on average over the course of the summer was out, so minimal
  • Board Member- Media incorrectly picked up that units didn’t have the outage opportunity they needed in the spring; they did just maybe not on day expect
  • Smati- What is our strategy around outages?
    • Lake- improvement in maintenance scheduler; setting cap that will go into place this fall; outages spread over a period of weeks
  • Board Member- Large increase in battery storage looks like it really helped us out; can you tell us what our key learnings in that area are? Did we have any issues with Bitcoin miners when we got into peak conditions?
    • Batteries incorporated into the market in a workaround fashion, not perfect or ideal; will see over coming months incremental improvements
    • Large Flexible Loads didn’t have problem; concern of not knowing how they will behave on any given day; working to get better understanding of commitment and decommitment decisions
    • Woodfin- If batteries are being used to provide ancillary services then the generation that would otherwise have provided ancillary service can be used to serve energy; Large Flexible Load (LFL) taskforce working with stakeholders on education and rules
    • Woodfin- Early in summer learning curve with LFLs and response to high prices delayed because of this; confusion with LFLs carrying ancillary service and still running during high prices while supplying those ancillary services

 

Item 7: Independent Market Monitor Report; no presentation or questions

 

Item 8: TAC Report

Robert “Bob” Flexon

  • Asked question about makeup and structure of stakeholder process; SB 2 removed codification in PURA, wanted to correct for the record
  • NPRR1084 had one vote against it, dealt mainly with compliance concerns and derates
  • TAC subcommittee structural and procedural review on 9/12/22; results and recommendations were endorsed at TAC meeting on 9/28/22
  • Major transmission elements (MTE) list was unanimously approved by TAC as endorsed by WMS and ROS
  • Updated NOGRR references to POI to POIB; in appendixes if you want to look further
  • Motion on NPRR1084 passes

 

Item 9: Finance and Audit Committee Report

William Flores

  • In general section updated committee self-evaluation process and reviewed financial statements; preliminary timing of 2023 budget refreshed and an internal audit discussion
  • Request for additional staff member has been approved; approved hiring of a firm to conduct a quality assessment review

 

Item 10: Human Resources and Governance Committee Report

Peggy Heeg

  • Discussed challenges yesterday and will continue in future meetings; discussion about proposed bylaw notice issued on September 29th; acknowledge comments from corporate members

 

Item 11: Reliability and Markets Committee Report

Bob Flexon

  • Covered report from TAC on annual review process and objectives; reviewed and approved the retirement of the committee work group; discussed self-evaluation, aggregate distributed resources pilot process, and systems updates on various IT projects; recommend board approve pilot project
  • Motion to approve passes

 

Eric Goff, on behalf of Arushi Sharma Frank at Tesla

  • Looking forward to working closely with ERCOT staff on the pilot project

 

Gale Alfar, self

  • Asks board of directors to approve pilot project so Texas can have a virtual power plant (VPP) and lead the way
  • Sees VPPs as a way of saving lives by keeping hospital equipment and home medical equipment on

 

Item 12: Annual Membership Meeting Announcement

  • 52nd annual meeting will take place on December 20th, agenda will be posted on December 13, record date is November 18

 

Board adjourned general session and began executive session