The background and history of CARD were reviewed, highlighting potential adverse incentives for load behavior.
The calculation window for CARD has a significant impact on load value and behavior, with longer intervals reducing the value per megawatt hour.
Crypto miners can economically inflate demand to capture high CARD revenue during peak intervals, causing price inflation.
Different CARD distribution methodologies were compared: current peak interval, peak day alternative, and whole month distribution, with the latter reducing incentives to maximize load ratio share.
The IMM proposes a shift to a whole month distribution for CARD to minimize adverse economic incentives.
Support for ERCOT's preferred solution to distribute CARD revenue over the whole month was emphasized.
Discussion on 4CP and its impacts on market efficiency and cost recovery, with suggestions to retain 4CP allocation at least during summer months.
Concerns about the CARD's role as a type of refund for transmission ratepayers were raised, noting policy implications for loads that avoid transmission costs.
Questions and opinions from various members highlighted a general agreement on reducing incentives that increase peak loads and considering monthly load ratio share-based allocations.
Continuation of the discussion on possible CARD distribution methodologies and their implications.
Preparing for an NPRR to be filed with consensus from WMS.
Presenting any additional information or updates in the next month's meeting.
5.4 - Report template to track AS Provision & Performance issues related to insufficient State of Charge, Luis Hinojosa & Sam Fabricant
Introduction of a report template to track AS shortfall caused by State of Charge (SOC)
Recent implementation of NPRR1186 on June 27, improved state of charge management for SCED dispatch to support ancillary service obligations
Background on NPRR1186 and NPRR1149 - neither currently account for SOC or any shortfall in ancillary services
Proposal to generate a monthly report tracking AS shortfall due to insufficient SOC, including mock data since NPRR1186 was only recently implemented
Explanation of failure to provide (responsibility but insufficient SOC) and failure to perform (event request but no energy dispatched)
Details on calculations for megawatt shortfall and its impact across Non-Spin, ECRS, RRS, and regulation
August production version of the report to be created with July data
Requests for feedback from stakeholders on the report content and usefulness
Clarifications on interpretations of megawatt shortfall calculations and implications for stakeholders
Discussion of using specific metrics like ERCOT ballot TRE-001 logic for performance evaluations
Feedback sought on definitions and thresholds for low SOC as indicators of failure
Determination of a formal version with real data starting in August, use of 20% SOC as a variable for initial analysis
Concerns about how shortfall calculations and ancillary service provision are reported, including suggestions to look at the QSE level
Clarification requested on the components of the shortfall and how it's calculated
Use of both mock and real data to illustrate failures in SOC
Caitlin Smith, Michael Jewell, and Bob Wittemeyer's input on potential misleading aspects and technology neutrality
Agreement to follow up at Work Management Working Group (WMWG) for further detailed discussions and feedback
Acknowledgement of TAC and board's request to keep monitoring SOC effects on ancillary services
Next steps including refinement and clarifying the intent of the template as a non-mandatory, responsive measure.
6 - Resource Cost Working Group - RCWG - Blake Holt
Summary:
RCWG met on June 25 to discuss VCMRR041, which aims to replace the current index price subscription for NOx and SO2 with fixed prices: $3/short ton for NOx and $2/short ton for SO2.
ERCOT's justification: The annual index pricing has been stagnant for the past five years. The fixed prices would remain until new EPA requirements or a competitive market arises, or as directed by TAC.
Luminant expressed interest in a seasonal index price approach and maintaining the subscription to quickly respond to political changes. They are considering proposing a user fee for the subscription costs.
Luminant plans to present additional language and a new NPRR to RCWG in July.
ERCOT cautioned that prolonged discussions might force recommitment to the existing subscription for index pricing. Corrected timelines indicate that VCMRRs spend two meetings at WMS and then proceed to further approvals.
Katie Rich (Luminant): Plans to draft and file new VCMRR and NPRR with feedback from RCWG quickly.
Ino clarified that VCMRR041, as submitted by ERCOT, will skip PRS because it has no impact and will spend two months at WMS.
Vendor reports no trades have occurred for annual and seasonal prices in the last five years.
ERCOT prefers stopping the subscription until a market for emissions arises, while also acknowledging Luminant's alternate proposal.
US Supreme Court stopped the EPA's good neighbor plan, affecting NOx control implementation.
IMM is requested to provide a recommendation regarding liquidity in the emissions market.
7.2 - VCMRR040, Methodology for Calculating Fuel Adders for Coal-Fired Resources
Discussion on WMS revision requests, VCMRR040
Approved language last month
8 - Demand Side Working Group - DSWG - Nathaniel Mancha
Covered two NPRRs, presentation NPRR1226 and NPRR1217.
NPRR1226: Discussed demand response monitoring, including data sharing to improve market transparency.
NPRR1217: Focused on removing verbal dispatch instructions for load resource and ERS deployments, with implementation expected by December 1 of this year.
9 - Supply Analysis Working Group - SAWG - Kevin Hanson
Kevin Hanson confirmed as SAWG chair and will be added to the combo ballot.
Thinesh presented 2023 distributive generation report estimating 48 MW, with a moderate forecast of 6 GW of rooftop solar by 2032.
Katie Lamb and Sam Morris presented on the updated long-term load detailed analysis with key points including dispatchable and non-dispatchable loads, and load forecast impacts.
Discussion on the speculative nature of new contracts and executive letters, with concerns about their impact on market messaging.
Bob Witmeyer questioned the assumption of 24/7 load for hydrogen, with responses indicating the unproven nature of its flexibility.
Eric Schubert raised points about non-dispatchable industries' potential for peak shaving, with responses highlighting consistency issues in response.
Pete Warkin provided updates on the CONE study, reliability standard, volume update, and August Mora report.
Final announcements included a low wind risk profile addition, CDR NPRR work in progress, and an upcoming preliminary volume value based on survey data expected in mid to late July 2024.
9.2 - Chair Kevin Hanson, Black Mountain Energy Storage
Kevin Hanson has changed employers from National Grid to Black Mountain Energy
Kevin Hanson will remain as chair.
10 - Wholesale Market Working Group - WMWG - Blake Holt
