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Meeting Summary - 10/10/2024 Board of Directors Meeting
Grid Monitor AI1 - Call General Session to Order - Chair 0 October 10, 2024 Board General Session Agenda
Chair announced reappointments and new positions: Bill Flores as Board Chair, Peggy Heeg as Vice Chair. Reappointments include directors Aguilar, Swainson, and England for second three-year terms. Bob Flexen announced he will not seek a second term and will step down after December 1, 2024. Discussed upcoming transition plans for selecting a new board member post Flexen's term. Antitrust admonition and security details included in meeting materials.
2 - Notice of Public Comment, if Any - Discussion - Chair 2 Notice of Public Comment, if Any
The meeting agenda was publicly posted on October 3, 2024, with instructions for public commenting. No public interest in commenting has been expressed to date. A representative from CPS Energy will provide their perspective on ironic resources in item 6.
3 - Consent Agenda - Vote - Chair
Chad provided information on the budget impacts linked to the revision request.
3.1 - Unopposed Revision Requests Recommended by TAC for Approval - Vote 3.1 Unopposed Revision Requests Recommended by TAC for Approvals
There are eleven revision requests on the consent agenda. None of the revision requests have an ERCOT staff impact. Two of the revision requests have an ERCOT budget impact.
3.1.1 - NPRR1188, Implement Nodal Dispatch and Energy Settlement for Controllable Load Resources - Vote
NPRR1188 has a budget impact estimated between 1.8 million and 2.5 million. Purpose: Change the dispatch and pricing of controllable load resources to settle them at nodal price. Initiative started at the commission as part of their blueprint and is now on the board's consent agenda. No board members commented or requested to remove any items from the consent agenda. A motion to approve the consent agenda was made and seconded. Vote Result: All in favor, none opposed, no abstentions. Consent agenda was approved.
3.1.2 - 3.1.6 3.1.7 - NPRR1244, Related to NOGRR263, Clarification of Controllable Load Resource Primary Frequency Response Responsibilities - Vote
NPRR1244 has a budget impact between 70,000 to 100,000. Motion to approve the consent agenda as it was presented: consent agenda was approved
3.1.8 - 3.1.11 4 - NPRR1188, Implement Nodal Dispatch and Energy Settlement for Controllable Load Resources - Vote 4 August 20, 2024 Board General Session Meeting Minutes
August 20, 2024 general session meeting minutes were discussed. Motion made to approve the minutes. Motion was seconded and approved.
5 - CEO Update - Discussion - Pablo Vegas 5 CEO Update REVISED
Key Discussion Points:
Topic: Real-Time Co-Optimization and Battery Project (RTC+B)
Targeted go-live date is December 5, 2025, earlier than mid-2026. Includes enhancements for battery energy storage resources. Market trials begin in May 2025; cutover planned for December 5, 2025. Provides flexibility to efficiently procure and deploy ancillary services.
Topic: Permian Basin Reliability Plan
Plan approved by the Public Utility Commission. Transmissions service providers to prepare certificates for critical import paths. Involves potential use of extra-high voltage transmission infrastructure.
Topic: Southern Spirit HVDC Project
Awarded $360 million in DoE funding. Will interconnect ERCOT with Eastern Interconnect. The project does not alter the principles of ERCOT as an isolated grid.
Topic: Ancillary Services Methodology Changes
Overall quantities of services are decreasing from 2024 to 2025. Improved modeling reduces need for some services. Methodology considers better risk management and forecast adjustments.
Topic: New Mobile Application Launch
Released on iOS and Android platforms. Includes interactive dashboards, customization, and educational content. Part of a broader social media expansion strategy.
6 - Update on CPS Energy Reliability Must-Run RMR and Must-Run Alternative MRA Process - Discussion - Pablo Vegas / Woody Rickerson / Chad V. Seely 6 Update on CPS Energy Reliability Must-Run (RMR) and Must-Run Alternative (MRA) Process
ERCOT has been working collaboratively with CPS Energy on negotiating potential RMR agreements for three resources, targeting a decision by December. The RFP deadline was extended to October 7, yet only one MRA offer was received, indicating limited industry response. Discussion about CPS's revision of the suspension of operations date to March 2, addressing lost opportunity cost policy issues. Full analysis is being prepared for a December board meeting, with possible extension to a special meeting or February if needed. All three units have been determined necessary following reliability analysis focusing on transmission system impacts, particularly the interconnection reliability operating limit (IROLs) in South Texas. Only one MRA proposal was received, for a 1200 MW storage resource, effective summer 2026; no offers covered 2025 needs. CPS Energy is preparing for potential inspections and outages of the units, facing possible extended lead times for critical parts. There is uncertainty regarding the availability of these units for summer 2025 and a need for expedited analysis to mitigate potential rotating outages. ERCOT plans to consider all factors, including potential qualitative and quantitative assessments, in preparation for December decision-making. Transmission projects are underway to permanently address reliability issues, but they won't be fully operational until summer 2027. Discussion about the economic feasibility of accelerating transmission solutions as a long-term strategy.
7 - Summer 2024 Operational and Market Review - Discussion - Dan Woodfin / Keith Collins 7 Summer 2024 Operational and Market Review
The summer of 2023 had the 6th hottest average temperature on record for Texas. Peak temperatures this year were generally lower than last year but minimum temperatures were higher. Demand patterns show minimum demands close to peak demands from five years ago indicating significant load growth. Net load tightness is more critical after solar generation decreases in the evening. August 20th was the only day all generation resources were fully utilized, compared to multiple such days the previous year. More physical responsive capability available this year compared to the previous year's tightest days. Energy storage resources (ESR) played a critical role during peak periods, especially when solar generation decreases. Market prices were significantly down (82% year-over-year) due to increased solar and storage capacity. Ancillary service costs dramatically decreased from over 800 million last August to 36 million this year. Forward price curves have been reducing over the past few months. A notable shift in the type of loads—towards both base and load-following—anticipating significant load growth in the future. Reduced reliance on RUC during summer months seen as a positive change.
8 - TAC Report - Discussion - TAC Chair 8 TAC Report
Eleven revision requests were recommended for approval unanimously, including a recommendation for the 2025 ancillary services methodology. Reliability and operations subcommittee focused on transmission planning and related issues such as NPRR1247 and NPRR1180. Retail market subcommittee is working on Texas set version five implementation and other issues. Wholesale market subcommittee is discussing NPRR1235 and recommendations from the Independent Market Monitor (IMM). Concerns discussed regarding implementation of a Dispatchable Reliability Reserve Service (DRRS) and related policy implications. Transmission planning and economic tests like NPRR1247 are pressing issues; concerns over language and timeline were raised. Credit finance subgroup is reviewing credit implications of revision requests. Progress on RTC+B implementation is managed well, with focus on ancillary service demand curves. Large flexible load task force is working on large load connection size and NPRR1238. Discussion on 2025 ancillary service methodology involved opposing vote concerns focused on reliability and market signals. Stakeholder process improvements emphasized the need for written comments and better communication between stakeholders and the board. Concerns were raised over implementation timelines and backlog of pending revision requests post-Winter Storm Uri and RTC implementation. Chairman Flexen is leaving, and his leadership was appreciated. A call for written comments from stakeholders to provide clarity on positions was reiterated.
9.2.1 Ratification of Officer
9.2.2 Appointment of Non-Independent Manager and Officer of Texas Electric Market Stabilization Funding M LLC (TEMSFM)
9.2.3 Appointment of Non-Independent Manager and Officer of Texas Electric Market Stabilization Funding N LLC (TEMSFN)
9.3.1 - Recommendation regarding 2025 ERCOT Methodologies for Determining Minimum Ancillary Service Requirements - Vote - Chair 9.3.1 Recommendation regarding 2025 ERCOT Methodologies for Determining Minimum Ancillary Service Requirements
Service requirements recommendation by ERCOT staff, R&M committee, and TAC to be effective January 1, 2025. Motion for approval initiated by Bob. Seconded by Peggy. Vote conducted with unanimous approval and no opposition or abstentions.
9.3.2 - NPRR1190, High Dispatch Limit Override Provision for Increased Load Serving Entity Costs - Vote - Chair 9.3.2 NPRR1190, High Dispatch Limit Override Provision for Increased Load Serving Entity Costs
The R&M committee considered NPRR1190, which was previously tabled by the board after the August meeting due to six opposing votes from TAC by consumers. ERCOT staff filed additional comments on September 19, 2024, which were considered by the R&M committee, along with joint consumer comments from October 2, 2024. Comments were heard from commission staff, ERCOT staff, and a corporate member from Lyondell Chemical. Commission staff and Lyondell Chemical indicated NPRR1190 is too broad and recommended remanding it to TAC. NPRR1190 does not have an urgent status and does not impact reliability. The R&M committee recommended remanding NPRR1190 back to TAC. A motion to remand NPRR1190 to TAC was moved and seconded, with unanimous approval and no abstentions.
9.3.3 - Reliability and Markets R&M Committee Report - Discussion - R&M Chair 9.3.3 Real-Time Market Price Correction – Incorrect Recall of ERCOT Contingency Reserve Service
The R&M committee recommended board approval for price corrections for two event sets meeting protocol criteria. The first price correction was discussed in the Technology Committee meeting. The price correction involves returning money to generators who paid too much.
9.3.4 - Real-Time Market Price Corrections – Incorrect Resource Data Impacting the Real-Time Market - Vote - Chair 9.3.4 Real-Time Market Price Correction – Incorrect Resource Data Impacting the Real-Time Market
Motion moved for price corrections for operating days August 9 and 10, 2024, due to incorrect resource data. The price corrections motion for August 9 and 10, 2024, was also approved unanimously. ERCOT staff reported drafting and posting an ancillary service demand curve's white paper. The independent market monitor discussed ancillary services demand curves to ensure they do not delay the implementation of real-time co-optimization.
9.4 - NPRR1190, High Dispatch Limit Override Provision for Increased Load Serving Entity Costs - Vote - Chair
Committee met with no voting items other than meeting minutes. Presentation on emerging technologies: phasor measurement units (PMUs) by Dr. Jim Fulham. PMUs measure voltage and phase shift, used in ERCOT for real-time grid data. PMUs assist ERCOT operators in grid instability awareness and problem equipment identification. Discussion on current use and expansion of PMUs by Fred Wang, highlighting cost issues for transmission operators. Transmission of PMU data to ERCOT is voluntary; exploring incentives for broader deployment. Committee briefed on development projects, with 60 ongoing, generally on schedule. Focus on real-time co-optimization with implementation set for December 5, 2025. Future agenda includes development discussion on small modular nuclear reactors in Texas, planned for December meeting.
10 - Annual Membership Meeting Announcement - Discussion - Chair / Chad V. Seely 10 Annual Membership Meeting Announcement
Annual membership meeting scheduled for Monday, December 2. Location is Downtown Marriott, same as last year based on positive feedback. Agenda will include feedback from board and corporate members to enhance engagement. Pre-meeting social engagement planned for members, board, ERCOT staff, and invited guests. Meeting is a requirement under Texas business organization code and ERCOT bylaws. Colin Martin, Senior Director of Transmission Grid Operations at Oncor and TAC Vice Chair, will be a corporate member speaker. Finalization of two guest speakers is in progress. Post-meeting social reception will be held. Corporate members to receive invitations on November 11. Possibility of allowing more than one invited guest based on capacity.
11 - Other Business - Discussion - Chair
No additional business was raised by board members. The board adjourned the general session to move to executive session. Two voting items were anticipated to emerge from the executive session.
Meeting adjourned for a break.
12 - Vote on Matters from Executive Session - Vote - Chair
Motion to approve contract matter discussed during executive session under item ES 2.1.1 was moved by Bob and seconded by Peggy: Motion was approved unanimously with no opposition or abstentions. Motion to approve contract matter discussed during executive session under item ES 2.1.2 was moved by Peggy and seconded by Bob: Motion was approved unanimously with no opposition or abstentions. Announcement: Julie England appointed as the new R&M Chair.
13 - Adjournment - Chair
The meeting was officially adjourned by the Chair.
