1. How the Transmission System Works Really William F. Reinke

2. 2 Acknowledgements ● Don Benjamin – NERC Staff  www.nerc.com www.nerc.com ● Terry Boston - TVA

3. Topics ● Purpose of the transmission system ● Structure  Bits and pieces, odds and ends ● How to buy and sell electricity  Before and after deregulation ● Major blackout chronology ● Important dates

4. Characteristics of Electricity ● Travels at the speed of light ● Cannot be stored ● Network must be continuously connected  Cannot be “routed”

5. Terms ● Voltagevoltspressure ● Currentampsflow ● Powerwattsv x a ● Energywatt-hourswatts x time ● Frequencyhertzcycles/sec ● Fundamental Laws  Ohm  Kirchhoff

6. 6 Power System Overview

7. 7 Substations

8. Circuit Breakers ● Open breaker  Power can’t flow ● Closed breaker  Power can flow ● Trip: Closed  Opened

9. 9 Bulk Power Transformers

11. 11

12. 12

13. 13

14. 14 Distribution Transformers

15. Purpose of Transmission ● Connect generators to each other and to the distribution system  Handle contingencies (equipment failures)  Dispatch generation economically ● Connect utilities to each other  Buying and selling electricity  Reserve sharing

16. But it’s not like... ● The natural gas pipeline system ● The telephone system ● The water system ● The transportation system ● These are examples of “switched” systems …because electricity can’t be routed!

17. The Control Area (Balancing Authority) M M Control Center Generating Plant #1 Generating Plant #2 Customers

18. Control Areas (Balancing Authorities) M A C D B M M M M M M M

19. The Steps of an Interchange Transaction Before Deregulation ● 3:40 pmSchedule ● 3:55 pmConfirm ● 4:00 pmBegin interchange  Seller increases generation  Buyer decreases generation ● 5:00 pmEnd  Seller decreases generation  Buyer increases generation Sale from A to B at 4-5 pm of 100 MW A $20/MWh B $40/MWh 100 MW Interchange Price = (A+B)/2 = $30/ MWh Set up by system operators

20. The Steps of an Interchange Transaction After Deregulation ● 3:40 pmSchedule ● 3:55 pmConfirm ● 4:00 pmBegin interchange  Seller increases generation  Buyer decreases generation ● 5:00 pmEnd  Seller decreases generation  Buyer increases generation Sale from A to B at 4-5 pm of 100 MW 100 MW Interchange Price Depends on Market Set up by Merchants M1 M2 A $20/MWh B $40/MWh

21. The Interconnections

22. 22 Regional Entities

23. 23 November 9, 1965April 3/ 4, 1976July 13, 1977July 2/3, 1996August 10, 1996June 25, 19982000/2001May 15, 2003August 14, 2003 Widespread Disturbances March 8, 2004 SERC

24. 24 KEY INDUSTRY DATES ● 1965Northeast Blackout ● 1968NERC Formed ● 1970SERC Formed ● 1973Oil Embargo, end of 7% annual growth ● 1977National Energy Plan – Created DOE ● 1978Public Utility Regulatory Policy Act (PURPA) ● 1978Power Plant and Fuel Use Act ● 1979Three Mile Island ● 1992Energy Policy Act ● 1996FERC Orders 888, 889 ● 1996California Restructuring ● 2000FERC Order 2000 RTOs

25. 25 KEY INDUSTRY DATES ● 2001September 11 ● 2002FERC Standard Market Design Notice Of Proposed Rulemaking ● 2003FERC Wholesale Power Market Platform White Paper ● August 2003Blackout ● August 2005Energy Policy Act of 2005 ● February 2006FERC Order 672 establishing rules concerning the certification of the Electric Reliability Organization and procedures for the establishment, approval, and enforcement of Electric Reliability Standards

26. 26 KEY INDUSTRY DATES ● April 2006NERC files Application to become the Electric Reliability Organization ● July 2006NERC Certified as the Electric Reliability Organization ● Nov 2006Regional Entity Delegation Agreements Filed ● March 2007FERC Order 693 approving 83 reliability standards and making compliance with reliability standards mandatory for all owners, operators and users of the bulk power system

27. 27 KEY INDUSTRY DATES ● April 2007FERC approves Delegation Agreements between NERC and the eight Regional Entities ● June 18, 2007Reliability Standards become mandatory for all owners, operators and users of the bulk power system