Energy Price Formation Senior Task Force
Language changes captured the idea of providing stakeholders the data they need to make informed decisions in the marketplace and added uplift and reserves to certain education topics. The charter is expected to be presented to the Markets and Reliability Committee at its Feb. 22 meeting.
The MRC approved the creation of the EPFSTF to evaluate proposals to enhance energy market and reserve market pricing. Its work is scheduled to be completed by the end of September.
The task force also reviewed its interest identification matrix with any eye toward ensuring the topics were purely of interest and did not veer into particular positions on the subject.
Hung-Po Chao, senior director and chief economist – Economics-Markets, presented the goals and criteria of energy pricing. He employed Adam Smith’s concept of the “invisible hand” that helps keep free markets in balance.
Catherine Tyler of Monitoring Analytics gave the Independent Market Monitor perspective on pricing, challenging the validity of several assumptions.
The group was scheduled to hear a presentation about gaps in current pricing methodology, but it was put on hold due to time constraints and to allow Adam Keech, executive director – Market Operations, to answer questions about PJM’s recent filing to the Federal Energy Regulatory Commission on the pricing of fast-start resources in the energy markets.
Summer-Only Demand Resources Senior Task Force
At the Feb. 14 meeting of the Summer-Only Demand Resources Senior Task Force, PJM answered stakeholder information requests; the task force also continued work on potential design components.
Andrew Gledhill, senior analyst – Resource Adequacy Planning, responded to stakeholder information requests on peak shaving. The questions covered the relationship of loss of load expectation (LOLE) to weather, further education on peak shaving implications on hourly loads and the sensitivity of the reliability requirement and VRR curve to the load forecast monthly shape.
PJM looked at the correlation of LOLE to temperature-humidity index (THI). PJM used GEMARS (an hourly LOLE tool) to confirm that LOLE has a strong positive correlation to THI (pages 4–5).
PJM also provided more peak shaving examples to help stakeholders better understand what the scenarios are and stressed that the education is an ongoing process.
Stakeholders added additional possible design components, and PJM posted the updated matrix after the meeting
Reliability Standards and Compliance Subcommittee
The Reliability Standards and Compliance Subcommittee provides a common platform for PJM and its members to discuss and collaborate on North American Electric Reliability Corporation (NERC) and regional standards, compliance issues, and the production and evaluation of quality evidence of compliance.
Among the topics at the Feb. 15 meeting, members reviewed the latest on a project (TPL-001-5) that addresses single points of failure (FERC Order 754) and maintenance outages in the near-term transmission planning horizon (FERC Order 786).
The near-term planning specifically addresses stability analysis for loss of long-lead-time equipment. The goal is to guarantee that routine relay failure will not upset system dynamics.