Transcript Advanced Technology in the Texas Electric Market

Advanced Technologies
in the Texas Electric
Market
Julie Parsley, Commissioner
Public Utility Commission of Texas
National Energy Marketers Association
March 31, 2004
Advanced Technologies in the
Texas Electric Market
• ERCOT Market and Basic Framework
• Opportunities for Advanced Technologies
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Competitive Energy Services
Competitive Metering
Distributed Generation
Energy Storage
High Temperature Conductors
Power Electronics
• FACTS Devices
• HVDC Ties
– Broadband Over Power Lines
Texas Electric Market
• The electric industry in ERCOT is approximately:
• $17 billion a year at the wholesale level
• $24 billion a year at the retail level
• ERCOT represents approximately 85% of Texas
• About 300 million MWh of power flow through the
ERCOT system on an annual basis
• Prices have increased due to rising natural gas
prices:
• The wholesale price has been
approximately $55/MWh
• The retail price has been approximately
$80/MWh
ERCOT Boundaries
Within ERCOT Only Texas PUC has Jurisdiction; in
Other Areas, Texas and the FERC Have Jurisdiction
ERCOT - Electric Reliability
Council of Texas
SPP - Southwest Power Pool
SERC - Southeastern Electric
Reliability Council
WSCC - Western Systems
Coordinating Council
Restructured Electric Market
Power
Generation
Companies
(PGCs)
Transmission and
Distribution Utilities
(TDUs)
Retail Electric
Providers
( REPs)
Retail
Provider
Retail
Provider
Retail
Provider
Unregulated
Regulated
Open Access
Unregulated
End User
Basic Framework of the ERCOT
Market
• PGCs register with the PUC and must comply with
the ERCOT Protocols and the PUC’s wholesale code
of conduct.
• TDUs must provide nondiscriminatory access to
wholesale transmission service. Pricing is based on
a postage stamp method. TDUs must offer standard
terms of service.
• REPs contract with PGCs for power to serve retail
customers. Customers may contract with
competitive energy services providers for additional
products and services.
• REPs must meet certain financial and technical
qualifications to be certified by the PUC. REPs must
comply with the PUC’s customer protection
standards.
PUC and ERCOT Oversee the Market
• Role of the PUC
– Continue to regulate service quality and rates for
TDUs
– Ensure a fair competitive playing field for all
unregulated services
– Establish and enforce customer protections
– Oversee ERCOT
• Role of ERCOT, the Independent System
Operator (ISO)
– Central control center for grid operations
– Maintain system reliability
– Customer registration agent for customer
switching
– Conduct transmission planning
Competitive Energy Markets Require
Services that the Power System Was
Not Developed to Provide
• The transmission system was not
developed for commercial sales.
• Electricity consumption is increasing and
power quality is important to sensitive
microprocessor-based equipment.
• The conventional grid must be
transformed to a smart electricity network.
Competitive Energy Services (CES)
• Utilities are prohibited from providing CES as of
September 1, 2000.
• Opportunities for CES providers:
– Specialize in particular competitive services (e.g.,
load-management, lighting, facilities operations,
transformation equipment, hedging and risk
management) without providing electricity.
– Partner with REPs to provide CES with electricity.
• CES are generally available on a competitive basis.
– Utility can petition to provide a CES if it is not
widely available.
– Affected person or PUC staff can petition to
designate other services as CES or end a utility’s
provisioning of a CES.
Competitive Metering
•
Competitive metering for commercial and industrial (C&I)
customers began January 1, 2004. Metering for
residential customers is provided by the TDU until the
later of September 1, 2005, or the date on which at least
40% of the residential customers are served by
unaffiliated REPs.
•
C&I customers may choose who owns the meter (the
retail customer, REP, TDU, or other person authorized by
the customer) and the customer owns the meter data.
•
ERCOT has a stakeholder process to establish and
periodically revise a list of meters qualifying as
competitive meters.
•
To date, customer participation is lacking. The PUC is
examining whether there are potential barriers.
Distributed Generation (DG)
• Customers are entitled to access to on-site DG.
• DG is an electrical generating unit(s) located at a
customer’s point of delivery up to ten MWs which is
connected at a voltage less than 60 kV.
• DG adds more competitive options, provides cost
savings, and benefits the electric system during
periods of capacity constraints.
• Texas has approximately 220,305 kWs of DG capacity.
• Wholesale market redesign efforts to move from a zonal
model to a nodal system should accommodate future
expansion and innovation.
• For more information, go to:
http://www.puc.state.tx.us/electric/business/dg/dg.cfm.
Energy Storage
• Compressed Air Energy Storage (CAES) basically
uses technology to store energy in the form of
compressed air in an underground salt cavern.
• CAES could be used to optimize non-firm
generation and manage transmission congestion
constraints.
– Study performed in 2003 in connection with
curtailments of wind generation in West Texas.
• There are regulatory implications surrounding
cost recovery for assets (storage) that are neither
purely transmission, nor purely generation.
High Temperature Conductors
• High temperature conductors (HTCs) may be an
attractive alternative to new wires to address thermal
limitations and loading issues:
– HTCs can increase transfer capability using existing
towers and ROW.
– HTCs do not require regulatory approval through the
CCN process.
• Aluminum Conductor Composite Reinforced (ACCR):
– Can provide transmission capacities up to 3 times
greater than traditional Aluminum Conductor Steel
Reinforced (ACSR).
– ACCR cost is 4 to 6 times the cost of ACSR.
• Aluminum Conductor Steel Supported (ACSS):
– ACSS has been used in Texas since 2000.
– One Texas utility has approximately 2,000 circuit miles
of ACSS and is participating in research on a national
level testing five different types of conductors.
– ACSS cost premium is only 10% over ACSR.
Power Electronics
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Power electronics improve system stability and enable
higher power transfer levels over greater distances.
Flexible AC Transmission Systems (FACTS) devices:
– Can help with functions that are required for smooth
operation of the electrical network (frequency control,
load-flow control, reactive power, and voltage
stability).
– Can control the power flow and increase transfer
capability.
– Do not require regulatory CCN approval or additional
ROW.
High-Voltage DC (HVDC) ties:
– Increase the capacity of an existing power grid and
allow power transmission between unsynchronized
AC systems.
– Require CCN approval.
– Texas has three HVDC ties and one pending CCN case
for an additional HVDC tie with Mexico.
Broadband Over Power Lines
(BPL)
• Over 5,000 comments and replies received in
response to the FCC’s April 2003 Notice of Inquiry
addressing areas such as potential benefits,
potential interference, and measurement
procedures.
• NARUC task force formed in December 2003.
• FCC NPRM issued Feb. 2004.
• AT&T recently announced that it was exploring
opportunities in Texas.
• Texas PUC has not formally addressed the many
surrounding issues.