1. Operating Reserves --- Again A Discussion Primer
Steve Ashbaker
Director, Operations
Mike Wells
Director, Market-Operations Interface

2. WESTERN ELECTRICITY COORDINATING COUNCIL
Regional Reserve Standard
Decisions made for the Future
Today – What we Have
Tomorrow – What is Proposed
Available Choices for WECC

3. WECC Board Technical Session December 5, 2007
The BOD believes a Frequency Response Reserve (FRR) standard is needed in WECC. This standard must meet the following criteria:
Meet or exceed the reserve level necessary to cover WECC/North American Reliability Corporation (NERC) Category C events (events resulting in the loss of two or more system elements).
Achieve an equitable distribution of FRR in accordance with WECC and NERC principles and prevent further degradation of FRR response rates.
Provide a clear, unambiguous basis for assigning reserve carrying responsibilities.
Create no adverse effect of existing path ratings or Operational Transfer Capabilities.
Provide for a daily assessment by Reliability Coordinators of FRR impacts on transmission path flows.
The Board requests that the proposed FRR field test be undertaken as soon as possible and concluded no later than Spring A standard meeting these objectives should be developed and put in place as soon as possible after the close of the proposed FRR field test, but no later than Fall of 2009.

4. WECC Board Technical Session December 5, 2007
Decisions Made for the Future
WECC FRR Standard
Arrest Frequency to prevent loss of load due to Under Frequency Load Shed caused by common generation outages (59.5 Hz)
System break-up/loss of load) due to transmission overloads caused by unbalanced governor response
NERC Standard – MSSC
NERC Standard – DCS

5. WECC Board Technical Session December 5, 2007
Today – What we Have
Existing Tier 1 Standard to be Replaced with permanent standard
Reserves Based on the Greater of:
Most Severe Single Contingency (MSSC)
7% “Load Responsibility” served from Thermal Resources +
5% Load Responsibility served from Hydro Resources

6. WECC Board Technical Session December 5, 2007
Today – What we Have
Amount of Contingency Reserves is based on “Load Responsibility” which includes transfer of required reserve allocation between Balancing Areas.
Board approved an “Interpretation of Load Responsibility” on September 7, 2007 in conjunction with BPS-014, Identification of Contingency Reserve Responsibility in the e-Tag 6

7. WECC Board Technical Session December 5, 2007
Today – What we Have
Additional reserve requirement for interruptible and recallable transactions
Contingency Reserves must be restored within 60 minutes of the event 7

8. WECC Board Technical Session December 5, 2007
Tomorrow
Proposed Replacement Standard for Existing Reserves Standard

9. WECC Board Technical Session December 5, 2007
Proposed Standard
Completed one round of comments
Responses posted, revisions made to the draft standard and posted for a second round of comments due January 2, 2007

10. WECC Board Technical Session December 5, 2007
Proposed Standard
The proposed draft is the Greater of:
Most Severe Single Contingency
3% of the BA Load plus 3% of the BA Generation
Not Load Responsibility – no shifting of reserve requirement between BAs at this stage
Additional requirements for transactions specifically dealing with reserves including reserve capacity transactions

11. WECC Board Technical Session December 5, 2007
Proposed Standard
“Load” can only count as non-spinning reserve if the entity has declared a capacity or energy emergency
Includes FERCifying
Sanction Table
Violation Risk Factors
Addresses FERC comments on ambiguity

12. WECC Board Technical Session December 5, 2007
Available Choices for WECC
Consider the Proposal if OC approves
FERCify existing standard
FERCify existing standard, update
Do Nothing
Request withdrawal of existing standard and fall back to RMS

13. WECC Board Technical Session December 5, 2007
Consider OC Recommendation
If the OC approves a “permanent” standard the Board will be asked to consider it in April
FRR continues through field test and standard drafting

14. WECC Board Technical Session December 5, 2007
FERCify Existing Standard
Sometimes called “status quo”
On track to meet the 1-Year Goal
Business concerns not addressed, FERC
But “the lights won’t go out”
FRR continues through field test and standard drafting

15. WECC Board Technical Session December 5, 2007
FERCify Existing Standard, Update
Sometimes called “status quo” plus!
Possibly on track to meet 1-Year Goal
Incorporate ILR, perhaps requirements for intermittent generation
Business concerns not addressed, FERC
But “the lights won’t go out”
FRR continues through field test and standard drafting

16. WECC Board Technical Session December 5, 2007
Do Nothing
FERC ordered changes not done – historically not a good idea
Credibility of the Council
Business concerns not addressed, FERC
But “the lights won’t go out”
FRR continues through field test and standard drafting

17. WECC Board Technical Session December 5, 2007
Withdraw Existing Standard, RMS
Take our toys and go home!
FERC ordered changes not done – historically not a good idea
RMS Sanction Table instead of NERC’s
Credibility of the Council
Business concerns not addressed, FERC
But “the lights won’t go out”
FRR continues through field test and standard drafting