Meeting Summary -08/15/24 Request for Proposals for Must-Run Alternatives Workshop

1 - Antitrust Admonition

2 - Overview

• CPS filed their notice of suspension of operations (NSOs) in early March.
• Three Braunig units are likely to be brought under Reliability Must-Run (RMR) service, set to retire on March 31, 2025.
• An MRA Request for Proposal (RFP) is being initiated for the period from April 1, 2025, through March 31, 2027, to find a potentially less expensive alternative to the three units.
• An open RFP process is seeking proposals from Qualified Scheduling Entities (QSEs).
• Possible alternatives include various generation resources, energy storage, other generation types, and demand response.
• NPRR885 play a critical role in the process.
• ERCOT’s Board of Directors will decide on entering into RMR or MRA agreements with a recommendation likely to occur in October or December.
• Evaluation will consider the costs, benefits, and risks associated with both RMR and MRA options.

3 - Summary of ERCOT’s Analysis - Tanzila Ahmed

• ERCOT conducted congestion analysis using UPLAN to perform an 8760 evaluation for 2025 to determine hours of overloads on key transmission lines related to an IROL.

• Results may be subject to change upon further refinement.

4 - Procurement Timeline

• Initial RFP version was sent out on July 25, same date CPS filed their part three of NSO.
• Questions regarding the RFP were received and answered by the following Monday.
• Target date to send amended RFP package, including updated submission forms, language, must run, and governing document, is set for Wednesday, August 21.
• Optional statements of intent to respond to the RFP are requested for better resource estimate.
• Deadline for RFP submissions is Monday, September 9, 03:00 p.m.
• Plan to evaluate updated RMR unit cost information alongside MRA proposals, with potential board action in October followed by contract execution.
• A market notice will be sent post-board approval.

5 - Key Details of the RFP

• Numbers presented are duplicates and subject to change; final numbers to be posted on August 21 with the new RFP package.
• Example of deployment numbers: Summer 2025 may have up to 80 deployments out of 122 contract days for Doctor MRA.
• Maximum number of deployments and duration requirements are highlighted and may be revised.
• Seasons have specific windows with defined duration requirements (e.g., winter season has a 5-hour window but 4-hour duration requirement).
• Four different offer submission forms for various resources: generation, energy storage, other generation, and doctor resources.
• Offer submission can be for one season or all seasons; ERCOT will evaluate must run alternatives submitted through the RFP process.
• Timeline review followed by opportunity for questions.

5.1 - Key Details - MRA Payments

5.2 - Key Details - Settlement

• Costs, including standby, deployment, variable payments, and capital contributions, will be allocated based on an hourly low ratio share after the final settlement.
• ERCOT aims to utilize existing systems for settlements if possible, otherwise, a manual process will be used.
• If questions arise regarding compensation, stakeholders are invited to reach out for further clarification.

5.3 - Key Details - Additional Information

• Submitted an RFP package on July 25.
• Identified 20 items for change in the next version of the RFP package.
• Clarifications provided for an MRA site in a NoE service area.
• Timeline and details for data requests at an MRI site in the NOAA service area are being worked out.
• Changes will be posted on August 21.
• Ramp period for doctor MRAs and other generation MRAs set to 30 minutes.

6 - Key Questions & Responses

7 - Adjourn