Enhancing Interruptible Rates Through MISO Demand Response: WIEG Annual Meeting June 19, 2008 Presented by: Kavita Maini, Principal KM Energy Consulting, LLC

2 Role of Interruptible Load in Wisconsin  Counted towards reserve margin requirements  Utilities use interruptible load in lieu of building a peaking plant – In exchange customers get a capacity based credit  Utilities typically have minimum requirements in the tariff including notification time, maximum hours of interruption, contracted firm demand levels  Used mainly for capacity based interruptions by most Wisconsin utilities

3 Interruptible Load in Wisconsin By Major Utility

4 Participation of Interruptible Load in MISO  Price responsive demand bids  Reserve Margin Requirements  Ancillary Services  Emergency Demand Response

5 Emergency Demand Response Initiative  Main outcome from the August 2006 Energy Emergency Events – To compensate for energy reduction  Retail customers not direct participants in EDR; Utilities are the market participants and eligible to participate  Utilities would need to develop an additional rider or make this an option in the existing rate  Voluntary program  Interruptible load can be counted towards reserve margin requirements and also participate in EDR

6 EDR Requirements  Need to register with MISO 30-days in advance  Static offer for 30 days; MISO does not have the ability accept daily offers Exception – exigent circumstances Penalties for not curtailed amount reflected in the offer (real time market price multiplied by the amount deficient)  Participants can either specify the number of MW to be curtailed or curtailing down to the firm level  Provide notification time needed  Hourly curtailment offer not to exceed a cap of $3500/MWh

7 EDR Compensation  Provided that market participants respond as instructed by MISO, they will be compensated using the higher of the market price or the participants’ curtailment offer multiplied by the amount of energy curtailed  Compensation only if MISO issues deployment request  To the extent that market participants are paid higher than the market price, the costs are collected from the zone where the resource deficiency occurred

8 Energy Emergency Event (EEA) Protocol  EEA-0: Alert – Heads up  EEA-1:Warning  EEA-2: The EVENT Once designated external resources are committed, interruptible load that does not participate in EDR gets initiated first This is followed by interruptible load that is participating in EDR Emergency dispatch ranges of generators Emergency purchases from bordering balancing authorities Firm load shed