Hour Ahead Dispatchable Loads Applicable Updates to Procedures Presentation to the Market Operations Standing Committee April 23, 2003

2 Affected Market Manuals MM 1.2: Facility Registration, Maintenance and De- Registration (MDP_PRO_0016); MM 4.2: Submission of Dispatch Data in the Real-Time Energy and Operating Reserve Markets (MDP_PRO_0027); MM 4.3: Real-Time Scheduling of the Physical Markets (IMP_PRO_0034);

Market Manual 1.2: Facility Registration, Maintenance and De-Registration

4 MM 1.2: Facility Registration, Maintenance and De-Registration Section 2.1: HADL registration cannot be completed if the IMO and the market participant do not agree on a methodology to measure compliance and establish a baseline; Section 2.5: As a registration requirement, HADL must be larger than 1 MW. HADL resources can aggregate to meet this requirement;

5 MM 1.2: Facility Registration, Maintenance and De-Registration New Section 2.8: The IMO may restrict the number of facilities that can be registered as HADL, indicating what will be the limiting conditions and how will this restriction be communicated; HADL required to complete an "Application Form for Registering as Hour Ahead Dispatchable Load"- to be developed; No changes required to PLC; At the end of registration, the IMO send out a Notification of Registration (IMO-FORM-1084);

6 MM 1.2: Facility Registration, Maintenance and De-Registration The new "Application Form for Registering as Hour Ahead Dispatchable Load" will include: Information about the Dispatch Messaging Contact; Maximum MW available for the program; Indication that the HADL applicant can only be registered to participate in the energy market; Information about the methodology of determining compliance, means to measure compliance and baseline determination; A statement of capability, formalising the registration request and binding the participant to the market rules related to HADL.

7 MM 1.2: Facility Registration, Maintenance and De-Registration Section 3: To update their registration information, HADL participants are required to complete the "Change Control Form - Facility Maintenance" (IMO-FORM-1241); Section 4: Market participants may choose to de-register their HADL facilities by submitting a written request to the IMO. Furthermore, the IMO has the authority to de-register an HADL facility if the market participant has breached the market rules; The IMO may stay the application of market rules applicable to HADL if is determined that this application has a negative impact on the IMO administered markets and the IMO-controlled grid.

Market Manual 4.2: Submission of Dispatch Data in the Real- Time Energy and Operating Reserve Markets

9 MM 4.2: Submission of Dispatch Data in the Real-Time Energy and Operating Reserve Markets Sections 1.1, 1.3 and 1.3.1: HADL dispatch data will consist of offer to reduce load; Section 1.3.1: HADL will submit dispatch data via ; HADL are not allowed to submit standing offers; Section and Appendix C.1: HADL dispatch data may be submitted, without restriction, from 6:00 EST on the pre-dispatch day until 3 hours prior to the dispatch hour.

10 MM 4.2: Submission of Dispatch Data in the Real-Time Energy and Operating Reserve Markets Section 1.3.4: HADL offers must contain at least 2 and may contain up to 4 price- quantity pairs for each dispatch hour; HADL dispatch data shall not include ramp up/down values; The quantity shall be expressed in whole MW (or MWh/hour); The quantity must be at least 1 MW but must not exceed the maximum load reduction for the HADL facility; Price shall be positive and expressed in dollars and whole cents per megawatt-hour; HADL offers must indicate a price at and above which the IMO may instruct the facility to reduce its energy withdrawals by the total offered quantity. This price shall not be greater than MMCP.

11 MM 4.2: Submission of Dispatch Data in the Real-Time Energy and Operating Reserve Markets Section 1.3.4: Market participants may not specify a maximum amount of energy that can be scheduled by the IMO for their HADL facilities over a dispatch day; Section and Appendix E: The IMO will use the scheduled HADL load reduction in the determination of pre-dispatch schedules calculated 2 hours prior and 1 prior to the dispatch hour; Section 1.4: HADL participants are responsible for submitting offers to reduce load and making revisions to these offers within the specified timeframes; The IMO is responsible for dispatching the HADL resources within the specified timeframes and factoring the scheduled HADL load reduction in the calculation of pre-dispatch.

12 MM 4.2: Submission of Dispatch Data in the Real-Time Energy and Operating Reserve Markets Appendix B: HADL offer template files will be made available on the Technical Interfaces page on the IMO public Web site; Appendix C.2.2: For HADL participants, the mandatory window is the period within 3 hours prior to the dispatch hour; Appendix E.2: the pre-dispatch timeline revised to include HADL-related milestones; Appendix E.4.1: The IMO will include dispatch schedules for HADL resources in the pre-dispatch information released to market participants.

Market Manual 4.3: Real-Time Scheduling of the Physical Markets

14 MM 4.3: Real-Time Scheduling of the Physical Markets New Section 1.7.2: The IMO, based on the 3 hours ahead pre-dispatch energy price will determine the dispatch schedule for HADL resources; As soon as practicable, but no later than 2 hours before the dispatch hour, the IMO will issue dispatch instructions to HADL participants; New Section 1.8.2: The IMO will issue dispatch instructions to each HADL resource by calling the Dispatch Messaging Contact and communicating the load reduction scheduled to be achieved. These phone dispatches will be recorded and stored for at least 7 years; The dispatch instruction issued to an HADL shall apply to a certain dispatch hour and shall specify that the HADL must reduce its energy withdrawals by the full amount scheduled by the start of that dispatch hour;

15 MM 4.3: Real-Time Scheduling of the Physical Markets New Section 1.8.2: HADL participants will acknowledge within 5 minutes the receipt of each dispatch instruction by sending an to the IMO; HADL participants must inform the IMO as soon as practicable when they intend to reduce energy withdrawals at a time earlier or for a time longer than scheduled; Section 1.8.4: If an HADL participant fails repeatedly to comply with a dispatch instruction by reducing less load than dispatched, the IMO will treat this action through the compliance process and may declare the HADL facility as non-conforming.

Establishing a Baseline Consumption Level

17 Establishing a Baseline Consumption Level (BCL) General principles: BCL will be calculated differently for workdays than for weekends and holidays; BCL will be calculated for each hour and day of the week by averaging the hourly energy consumption over a period of time prior to the trading day; Compliance will be measured against the BCL determined for the corresponding hour and day of the week.