The role of system reliability in Southwest Power Pool Integrated Marketplace

Summary form only given. As a Regional Transmission Organization (RTO), Southwest Power Pool (SPP) is mandated by the Federal Energy Regulatory Commission (FERC) to ensure reliable supplies of power, adequate transmission infrastructure, and competitive wholesale prices of electricity. In order to further improve system reliability and competitive wholesale electricity prices, SPP is moving from its current Energy Imbalance Service (EIS) Market with multiple Balancing Authorities (BA's) to a consolidated BA and an Integrated Marketplace, which includes Energy and Operating Reserve Markets and Transmission Congestion Rights Markets. This paper discusses how system reliability is considered in Day-ahead (DA) to Real-time (RT) business processes of SPP Integrated Marketplace, from both market design and market management system implementation perspectives. These business processes include: (1) Day-Before-Day-Ahead (DBDA) Reliability Unit Commitment (RUC) (2) Reserve Requirements Calculation (3) DA Market (4) DA RUC (5) Intra-Day RUC (6) Real-Time Balancing Market The ultimate goal of SPP Integrated Marketplace is to find the most economic solution to ensure system reliability, which is modeled as resource capacity adequacy and transmission security constraints in market clearing. Similar to other LMP based wholesale electricity markets, SPP adopts Security Constrained Unit Commitment (SCUC) and Security Constrained Economic Dispatch (SCED) in its new market design, which take into account N-1 grid contingency constraints in linear form for congestion management. In MMS design, Simultaneous Feasibility Test (SFT) is performed to capture transmission security constraints in DA market processes, while Real-time Contingency Analysis (RTCA) of Energy Management System provides real-time security constraints for RTBM clearing and pricing. Market power mitigation is conducted for each market clearing process to prevent from market participants abusing market power when committed or dispatched out-of-merit due to reliability reasons. Resource offer cap decision is made via market behavior test, market structure test, and market impact test that are conducted in DA market, RUC and RTBM. One unique process designed for reliability in the Integrated Marketplace is the Reserve Zone Requirement Calculation. SPP establishes Reserve Zones to ensure the deliverability of cleared Operating Reserve throughout the SPP Balancing Authority Area (BAA). SPP calculates the amount of Operating Reserve required for the Operating Day, on both a system-wide basis and a Reserve Zone basis, to comply with the reliability requirements specified in the SPP Criteria. SPP calculates the hourly Regulation-Up, Regulation-Down and Contingency Reserve requirements on an SPP BAA basis and calculates minimum Operating Reserve requirements and maximum Operating Reserve limitations for each Reserve Zone. Reserve Zone Min and Max are calculated by simulating the outage of the largest generators in each zone and dispatch reserves according to historical reserve deployment patterns. Another feature in the Integrated Marketplace that helps operators to ensure reliable grid operation is the Pre-RTBM process. Pre-RTBM is a multi-interval Look-Ahead (LA) SCED that can provide operators with the recommendations for Out-of-Merit Energy (OOME) to pre-ramp or pre-position resources for future system events, such as load pick-up, wind or interchange fluctuation, etc, in order to avoid potential capacity shortage and reduce the startup of expensive fast-start generators. In summary, SPP Integrated Marketplace design and implementation take system reliability as the first priority. It brings economic benefit to market participants and reduces the “up-lift” payment caused by reliability assurance.