1. Energy Storage Settlements Consistent with PUCT Project 39917 & NPRR461
ERCOT Commercial Market Operations
June 27, 2012 – ETWG Meeting

2. Implementation Concepts Metering Configurations Data Aggregation
Agenda
Guiding Principles
References to the preamble for Project 39917
References to the rule language
Commission Staff Direction on the rule intent for self serving loads
Implementation Concepts
Metering Configurations
Data Aggregation
Settlements
Spreadsheet Examples
Separate file attached to meeting materials
Operational Concepts – “Under Construction”
Concepts are not addressed by the rule language or the NPRR

3. Excerpt from Commission Response to question 1 in the preamble
Guiding Principle 1
An energy storage resource has the option of receiving wholesale storage load treatment.
Excerpt from Commission Response to question 1 in the preamble
“…. the storage facility could choose not to separately meter the storage facility and treat all energy purchased from the ERCOT system as retail sales.”

4. Guiding Principle 2
ESR Storage load must be separately metered to be considered wholesale storage load
Excerpt from § (m) (2)
“Wholesale storage occurs when electricity is used to charge a storage facility; the storage facility is separately metered from all other facilities including auxiliary facilities; and energy from the electricity is stored in the storage facility and subsequently re-generated and sold at wholesale as energy or ancillary services.”

5. Non storage generation may serve wholesale storage load
Guiding Principle 3
Non storage generation may serve wholesale storage load
Excerpt from Commission Response to question 1 in the preamble
“PURA § provides that a storage facility is entitled to be treated like other generation facilities in the sale of energy and ancillary services at wholesale. A key issue for the commission to resolve is how to treat a storage facility when it is acquiring energy. As explained below, the commission determines that the electricity withdrawn to charge a storage facility is a wholesale transaction. There are a number of possible scenarios where this issue arises, including the following: (1) only a storage facility and its auxiliary facilities (station power); (2) a storage facility, auxiliary facilities, and other consuming facilities, all under common ownership; (3) a storage facility, auxiliary facilities, other consuming facilities, and a non-storage generation facility, all under common ownership; and (4) a storage facility, auxiliary facilities, other consuming facilities, and a non-storage generation facility, with different ownership.” …
… “In the third scenario, where there is a storage facility, auxiliary facilities, other consuming facilities, and a non-storage generation facility, all under common ownership, the energy produced by the non-storage generation facility to charge the storage facility is self-use energy and should therefore not be treated as a retail sale, like energy generated by a non-storage generation facility and used for its auxiliary facilities.”

6. Commission staff direction on the intent of the rule
Guiding Principle 4
ESR Generation can be netted with generation site auxiliary loads and associated loads.
Commission staff direction on the intent of the rule
reference provided was an excerpt from the Commission Response to question 1 in the preamble
“PURA § provides that a storage facility is entitled to be treated like other generation facilities in the sale of energy and ancillary services at wholesale.”

7. Guiding Principle 5
Wholesale storage load is exempt from charges and credits based on Load Ratio Share or per MWH basis
Excerpt from § (m) (2)
“… Wholesale storage is not subject to retail tariffs, rates, and charges or fees assessed in conjunction with the retail purchase of electricity. Wholesale storage shall not be subject to ERCOT charges and credits associated with ancillary service obligations, or other load ratio share or per megawatt-hour based charges and allocations. ...”

8. Excerpt from §25.192,Transmission Service Rates (b) (1)
Guiding Principle 6
Wholesale storage load will not be included in the ERCOT 4CP calculations.
Excerpt from §25.192,Transmission Service Rates (b) (1)
“… A TSP’s transmission rate shall be calculated as its commission-approved transmission cost of service divided by the average of ERCOT coincident peak demand for the months of June, July, August and September (4CP), excluding the portion of coincident peak demand attributable to wholesale storage load….”

9. Guiding Principle 7
Settlement for a storage facility that has more than one delivery point shall be based on the net impact of those delivery points on ERCOT system.
Excerpt from § (m) (1)
“For a storage facility that has more than one delivery point, ERCOT shall net the impact of those delivery points on the ERCOT system for settlement purposes”

10. Guiding Principle 8
Wholesale storage load pricing shall be based on the LMP at the electrical bus
Excerpt from § (m) (2)
“… Wholesale storage is wholesale load and ERCOT shall settle it accordingly, except that ERCOT shall settle wholesale storage using the nodal energy price at the electrical bus that connects the storage facility to the transmission system, or if the storage facility is connected at distribution voltage, the nodal price of the nearest electrical bus that connects to the transmission system. …”

11. Implementation Concepts
Metering configurations
Will
require the ESR Charging Load that is requesting treatment as Wholesale Storage Load to be metered separately from all other site loads
be based on ERCOT system design and capabilities for accounting for the wholesale storage load and ESR generation
be discussed with the Settlement Metering Working Group
Will NOT
be allowed if they do not conform to a design that allows ERCOT to settle the site based on current system design
As rules are finalized Market Participants should work with ERCOT early during the design phase of their facility

12. Implementation Concepts
Data Aggregation processes
wholesale storage load
will
be included to determine total UFE
will NOT
be assigned Unaccounted for Energy (UFE)
be included in Adjusted Metered Load (AML)
be included in ERCOT 4CP calculations
be included in TRE fee calculations
have transmission and/or distribution losses added

13. Implementation Concepts
Settlement processes  
Site is net generation
Same settlements logic for all generation sites
Summation of POI metering point dollars
EPS metered energy * price at EPS meter
Generation POI’s
Settled using base point weighted price at the generation EPS meter(s)
Load POI’s, including ESR Charging Load POI’s
Settled using a time-weighted price at the Load EPS meter(s)

14. Implementation Concepts
Settlement processes  
Site is net load
Conditional calculation to determine WSL & Retail Load based on:
site net load value
metered value(s) of ESR charging load
Wholesale Storage Load
Settled using an energy-weighted price at the ESR Load EPS meter(s)
ESR load is LMP weighted average by telemeter ESR load
Retail Load
Assigned to an ESI ID

15. Implementation Concepts
Wholesale storage load treatment
Wholesale storage load will
be settled by QSE and Settlement Point
be settled through Real-Time Energy Imbalance at a Resource Node
Wholesale storage load will NOT
be included in any Load-shared charges and credits
be settled using a Load Zone Settlement Point Price

16. Questions and Discussion