Summary: Opening Comments on the Proposed Decision on RA Track 2 Issues (submitted November 18, 2024)
- christianbriggs70
- Nov 22, 2024
- 23 min read
The purpose of this summary is to streamline the review of opening comments on the Proposed Decision for Track 2 issues in the California Public Utilities Commission's resource adequacy proceeding, Rulemaking 23-10-011, and provide links to each party's comments (in the organization's name) for quick reference. Reply comments are due November 23, 2024. In the comments section below, please let me know if these were useful and if they can be improved. If these receive positive feedback, I will start publishing comment summaries within hours of the comment submittal deadline for those that have subscribed by email.
I. Introduction (p. 1)
The California Independent System Operator Corporation (CAISO) supports the Proposed Decision (PD), particularly its focus on maintaining reliability through the adoption of a 2026 Planning Reserve Margin (PRM) and retention of the 0.1 Loss of Load Expectation (LOLE) standard. It emphasizes the importance of aligning resource adequacy (RA) with system needs.
II. Discussion (p. 2)
A. The Commission Should Maintain Course to Adopt a PRM for 2026 That Meets a 0.1 LOLE (p. 2)
Support for 0.1 LOLE PRM: CAISO endorses maintaining a PRM aligned with the 0.1 LOLE target, ensuring that RA requirements reflect system needs.
Deferral to Track 3: Agrees with deferring the adoption of the 2026 PRM to Track 3 to allow additional review of modeling results while urging adherence to the 0.1 LOLE framework.
B. The Commission Should Maintain a 0.1 LOLE as the Reliability Target for the RA Program (p. 2)
Industry Standard: A 0.1 LOLE is widely accepted as a reliable metric for capacity sufficiency and aligns with IRP standards.
Consistency Across Proceedings: Aligning LOLE reliability targets between RA and IRP ensures compatibility and avoids discrepancies in resource planning.
C. The Commission Should Adopt a Regular Cadence for Energy Division to Perform LOLE Studies to Set the PRM in the RA Program (p. 3)
Biennial Studies: Supports performing LOLE studies every two years to account for changing inputs such as demand forecasts and hydro conditions.
Consideration of Annual Studies: Recommends evaluating the feasibility of annual LOLE studies to increase modeling accuracy and better reflect yearly changes.
D. The Commission Should Adopt Stress Testing as a Formal Part of the Process to Set the PRM (p. 5)
Importance of Stress Testing: Stress tests ensure that PRM levels are sufficient to meet the 0.1 LOLE target under various conditions.
Demonstrated Need: Previous studies have shown the necessity of stress testing in validating the adequacy of PRM recommendations.
E. The Commission Should Coordinate with the CAISO to Develop a UCAP Framework (p. 5)
CAISO’s Commitment to Support: Offers assistance in developing a UCAP framework by sharing outage data and analysis tools.
Flexibility in Design: Urges the Commission to avoid prescribing specific framework details prematurely to allow for alignment with CAISO’s ongoing stakeholder processes.
F. The Commission Should Not Eliminate Local Requirements (p. 7)
Geographic Granularity: Local RA requirements are essential to ensure adequate resource availability in specific areas.
Encouragement of New Development: Retaining local requirements fosters investment in areas needing additional capacity.
III. Conclusion (p. 8)
CAISO requests the Commission adopt the PD with its proposed recommendations, emphasizing the need for robust reliability metrics, stress testing, and collaboration in UCAP framework development.
I. Introduction (p. 1)
PG&E expresses strong support for the Proposed Decision (PD), citing it as well-reasoned and aligned with the issues raised in Track 2. The company emphasizes the importance of adopting the PD without modification.
A. PG&E Supports the Proposed Decision on Key Resource Adequacy Issues (p. 1)
Elimination of Non-Compensated Self-Showing Option: PG&E supports this structural change to the CPE framework, which enhances procurement transparency and improves decision-making.
Transparency Improvements: Supports the data changes outlined in Ordering Paragraph 4, which enable stakeholders to better understand and evaluate CPE procurement.
Evaluation Timeline: Recommends revisiting changes in 2027 to assess potential unintended consequences.
Pending Issues: Acknowledges the deferral of the LOLE study, Slice of Day calibration, and UCAP methodology to Track 3 and commits to further collaboration.
B. PG&E Supports the Proposed Decision on the Partial Adoption of the Recommendations in the Demand Response Load Impact Protocols Working Group Report (p. 2)
Simplification Recommendations: Endorses the partial adoption of the working group’s proposals, which streamline demand response evaluations.
Efficiency Gains: Highlights the potential for more efficient execution of load impact protocol evaluations starting in Program Year 2024.
Commitment to Robust Evaluations: Reiterates its commitment to producing valuable and efficient evaluations aligned with Commission expectations.
III. Conclusion (p. 2)
PG&E urges the Commission to adopt the Proposed Decision promptly and without modifications, underscoring its alignment with key resource adequacy and demand response objectives.
I. Introduction (p. 1)
Southern California Edison (SCE) supports the Proposed Decision (PD) but recommends several modifications to enhance the Central Procurement Entity (CPE) framework, improve data processes, and refine the approach to renewable production shapes.
II. The Commission’s Final Decision Should Modify the PD’s CPE Proposals (p. 2)
A. The Commission Should Modify the PD’s Proposal to Eliminate Self-Showing (p. 2)
Expand Elimination Scope: SCE recommends removing the self-showing attestation process for both compensated and non-compensated resources to streamline operations and avoid unnecessary complexities.
Data Sharing: Proposes that aggregated and anonymized LSE data be shared with both the CPE and LSEs, increasing transparency and improving procurement certainty.
B. The Commission Should Reject the PD’s Proposal to Adjust the CPE Timeline (p. 3)
CPE Allocations Timing: Opposes locking in CPE allocations one year in advance, citing risks of over- or under-procurement due to reliance on outdated or incomplete data.
Data Collection: Advocates for collecting LSE data multiple times annually to better reflect dynamic procurement activities and portfolio adjustments.
Efficiency Concerns: Highlights the potential for inefficiencies and higher costs for customers if CPE procurement decisions are made prematurely.
III. The Final Decision Should Modify the PD’s Proposal for Using SERVM Renewable Production Shapes for Exceedance Profiles (p. 5)
SERVM Profiles: SCE suggests replacing current exceedance profiles with SERVM production shapes to harmonize RA program requirements with IRP and LOLE modeling.
Clarification Needed: Urges the Commission to adopt the replacement immediately rather than deferring further consideration to Track 3.
IV. SCE Supports the Proposed Revisions and Modifications to the Load Impact Protocols (p. 6)
Simplified Protocols: Endorses the revisions from the Demand Response Load Impact Protocols (LIP) Simplification Working Group, which streamline evaluations while maintaining rigor.
Confidentiality Considerations: Agrees with deferring discussions on the confidentiality proposal to a more appropriate forum, such as the Data Working Group in R.22-11-013.
V. Conclusion (p. 6)
SCE supports adopting the Proposed Decision with its recommended modifications, emphasizing the need for improved CPE processes, alignment of renewable production shape methodologies, and efficient load impact evaluations.
I. Introduction (p. 1)
San Diego Gas & Electric (SDG&E) expresses general support for the Proposed Decision (PD), commending its approach to the 2026 Planning Reserve Margin (PRM), biennial loss-of-load expectation (LOLE) studies, and modifications to the Load Impact Protocols (LIP). However, SDG&E suggests refinements in two specific areas: UCAP methodology development and clarifying its position on CEJA/Sierra Club’s CPE proposal.
II. Discussion (p. 1)
A. The PD Should Be Revised to Facilitate Coordination Between Energy Division and CAISO Staff in the Development of Consistent UCAP Methodologies (p. 3)
Timeline Concerns: The PD's deadline for Energy Division (ED) to submit UCAP proposals in January 2025 does not align with the California Independent System Operator's (CAISO) ongoing Resource Adequacy Modeling and Program Design (RAMPD) schedule.
Coordination Recommendation: Proposes revising the PD to allow ED and CAISO to jointly develop UCAP methodologies for thermal plants and storage systems, ensuring alignment and consistency.
Efficiency Gains: Alignment between Commission and CAISO processes would prevent redundant efforts and support effective coordination under the existing Memorandum of Understanding (MOU) between the agencies.
B. The PD Should Be Revised to Clarify That SDG&E’s Concern Regarding CEJA/Sierra Club’s CPE Proposal Is Primarily the DER-Related Aspect of the Proposal (p. 4)
Focus on Distributed Energy Resources (DERs): SDG&E’s concerns are limited to the DER-related elements of CEJA/Sierra Club’s proposal, specifically issues like double counting of resources and eligibility discrepancies between supply-side and load-modifier resources.
Support for Clean Resource Procurement: Clarifies that SDG&E does not oppose the broader goal of procuring clean resources for local capacity but seeks adjustments to avoid inefficiencies and inaccuracies associated with DER procurement.
III. Conclusion (p. 5)
SDG&E supports the PD with the proposed revisions, emphasizing the importance of aligning UCAP methodologies with CAISO processes and accurately reflecting its position on CEJA/Sierra Club’s proposal. The company includes specific suggested changes to findings of fact, conclusions of law, and ordering paragraphs in Appendix A.
I. Introduction (p. 1)
CalCCA supports the Proposed Decision (PD) but recommends modifications to address timing and methodology concerns regarding the 2026 Planning Reserve Margin (PRM), Unforced Capacity (UCAP) development, and Local Resource Adequacy (RA) requirements. It emphasizes aligning RA planning with affordability and reliability goals.
II. The Proposed Decision Should Be Modified to Allow for an Earlier Adoption of the 2026 PRM If a Thorough Vetting of the Modeling Results Is Completed in Advance of the Track 3 Timeline (p. 3)
Support for Further Analysis: Agrees with delaying the adoption of the 2026 PRM to address outstanding modeling issues.
Flexibility for Early Adoption: Recommends allowing earlier adoption if Energy Division and stakeholders complete a thorough review before Track 3 deadlines.
Procurement Predictability: Emphasizes the importance of giving LSEs sufficient time to adjust their procurement strategies to any PRM changes.
III. The Proposed Decision Should Be Modified to Recognize That Changes to the PRM Can Have a Significant Impact on Both Reliability and Affordability (p. 5)
Cost Implications: Highlights that increasing the PRM by 1% could cost $158 million annually, requiring careful justification based on reliability improvements.
Reliability Trade-offs: Suggests balancing PRM adjustments with affordability, ensuring changes are economically justified by reductions in unmet load risks.
Resource Availability: Warns of potential shortfalls in RA resources to meet higher PRM levels and advocates for flexibility in compliance options.
IV. The Proposed Decision Should Adopt a UCAP Methodology with Corresponding Updates to Remove Forced Outages from the PRM and Prioritize Resource-Specific UCAP Values and a Methodology That Does Not Impact Existing Contracts (p. 6)
Support for UCAP Development: Endorses developing a UCAP framework to improve resource-specific reliability assessments and reduce reliance on PRM adjustments.
Forced Outages: Urges the removal of forced outage considerations from the PRM, as these are accounted for in UCAP values.
Contract Integrity: Advocates for ensuring that UCAP methodologies do not disrupt existing contracts, emphasizing the need for CAISO collaboration.
V. The Proposed Decision’s Reforms to the Existing Local RA CPE Framework with the Opportunity to Review Their Effectiveness at the End of 2027 Should Be Adopted (p. 8)
Support for Incremental Changes: Agrees with refining the CPE framework rather than implementing major reforms, allowing time to evaluate the effectiveness of the Slice of Day framework.
Procurement Transparency: Recommends requiring CPEs to provide resource-specific procurement data in their compliance reports.
Interim Basis for Changes: Suggests adopting changes, such as PG&E’s proposal for sharing aggregated LSE contract data, on a trial basis through 2027, with subsequent review.
VI. The Commission Should Clarify Its Directive to Retain Local RA Requirements (p. 9)
Local RA Responsibility: Seeks clarification that local RA requirements are assigned to CPEs in the PG&E and SCE territories, aligning with current practices.
Granularity of Local RA: Supports maintaining local RA requirements to ensure sufficient resource procurement in geographically critical areas.
VII. Conclusion (p. 10)
CalCCA appreciates the PD’s approach and urges the adoption of its proposed modifications to improve the alignment of RA planning with reliability, affordability, and market efficiency goals.
I. Introduction (p. 1)
The Western Power Trading Forum (WPTF) supports the Proposed Decision (PD) but suggests modifications to formalize the reliability standard, expedite the 2026 Planning Reserve Margin (PRM) decision, and ensure periodic reviews of the Local Resource Adequacy (RA) framework.
II. Comments (p. 2)
A. The PD Should Be Modified to Formally Adopt 0.1 LOLE as the Reliability Standard for the Resource Adequacy Program (p. 2)
Industry Standard: The 0.1 Loss of Load Expectation (LOLE) is recognized as the industry standard for electric system reliability.
Legislative Alignment: Recently enacted legislation (AB 2368) mandates that the RA program adhere to a robust reliability metric, such as 0.1 LOLE.
CAISO Support: CAISO endorses the 0.1 LOLE standard as a reliable measure to prevent capacity shortfalls.
Recommendation: Formal adoption of 0.1 LOLE would align the RA program with legislative intent and ensure consistent reliability across planning processes.
B. The PD Should Be Modified to Provide That the 2026 PRM Will Be Finalized Before the Conclusion of Track 3 (p. 3)
Timing Concerns: Deferring the 2026 PRM decision to June 2025 could create challenges for load-serving entities (LSEs) needing to meet year-ahead procurement deadlines.
Standalone Decision: Recommends issuing a standalone decision on the 2026 PRM immediately after Energy Division releases its revised PRM analysis in December 2024.
Avoiding Delays: An earlier decision would mitigate the risk of late-stage procurement difficulties and ensure compliance with updated requirements.
C. The PD Should Be Modified to Provide for Periodic Reviews of the Local RA Program’s Centralized Procurement Framework (p. 4)
Current Framework: While supporting the continuation of the centralized procurement framework, WPTF identifies unresolved issues within its structure.
Review Mechanism: Advocates for Energy Division to conduct a second review of the framework’s efficiency and effectiveness within two years to address ongoing concerns.
Continuous Improvement: Periodic reviews would ensure the framework adapts to evolving market and policy conditions.
III. Conclusion (p. 5)
WPTF recommends the following modifications to the PD:
Formal adoption of the 0.1 LOLE reliability standard.
A standalone decision on the 2026 PRM before the conclusion of Track 3.
Periodic reviews of the Local RA framework to assess and improve its efficacy.
Attachment A includes proposed findings of fact and conclusions of law to support these recommendations.
I. Comments on Additional LOLE and PRM Proposals (p. 2)
A. The Use of 0.1 LOLE Is Reasonable for This Proceeding, but the PD Should Be Clarified to Acknowledge Possible Advantages of Other Reliability Metrics as Generation Technology Changes (p. 2)
Support for 0.1 LOLE: Agrees with the use of the 0.1 Loss of Load Expectation (LOLE) as the standard for this proceeding, citing its alignment with current industry standards and the IRP program.
Potential for Alternative Metrics: Highlights research by the Electric Power Research Institute (EPRI) that suggests other reliability metrics, such as Expected Unserved Energy (EUE), may be more suitable for systems transitioning to renewable energy with storage.
Recommendation: Proposes revising the PD to state that other reliability metrics may be considered in future proceedings as technology and industry standards evolve.
II. Comments on UCAP Methodology (p. 3)
A. Lack of Data Access Should Not Prohibit a Resource-Specific UCAP Methodology (p. 3)
Concerns Over Data Limitations: Takes issue with the PD’s suggestion that data limitations could hinder the development of a resource-specific Unforced Capacity (UCAP) framework.
Successful Examples: Argues that other regions have implemented resource-specific frameworks successfully and that California can do the same by addressing data access issues.
Recommendation: Advocates for collaboration between the CPUC and CAISO to resolve data gaps and ensure the feasibility of a resource-specific UCAP framework.
III. Comments on Refinements to the CPE Framework (p. 4)
A. The PD Should Be Clarified to State Whether and How CPEs Are Authorized to Reduce Local Procurement Based on the New Data Request Process (p. 4)
Clarification Needed: Suggests that the PD’s language regarding the use of data from LSEs for procurement reductions is vague and could lead to implementation issues.
Recommendation: Proposes revising the PD to explicitly direct CPEs to reduce procurement requirements based on aggregated data from LSEs.
B. The PD Should Clarify the Data Request Process Does Not Impose Any Undue Obligations for the Reporting LSEs (p. 4)
Reporting Limitations: Requests that the PD specify that the data request process only requires LSEs to report existing RA contracts, without imposing additional obligations.
Recommendation: Recommends limiting attestations by LSEs to the accuracy of the data provided.
C. The List of Data LSEs Must Report Under the New Data Request Process Requires Clarification (p. 5)
Redundant Reporting: Notes that some requested data, such as Local Area and Resource Technology Type, can be derived from other sources and should not require duplication.
Vague Terminology: Highlights the need for clear definitions of terms like “contracted capacity” to avoid inconsistencies in reporting.
Recommendation: Proposes that LSEs report either Resource ID or Local Area/Technology Type, and that Energy Division handle calculations for compliance obligations.
IV. Conclusion (p. 6)
AReM supports the PD with its recommended clarifications and revisions. These changes aim to enhance the efficiency and clarity of the RA program while accommodating evolving industry standards and resource technologies.
Introduction and Summary of Recommendations (p. 1)
American Clean Power – California (ACP) commends the Proposed Decision (PD) for addressing key resource adequacy (RA) reforms. ACP provides recommendations to improve alignment between RA and Integrated Resource Planning (IRP), enhance methodologies for wind and solar resource counting, and refine Unforced Capacity (UCAP) development.
Discussion (p. 2)
I. The Commission Should Align Solar and Wind Resource Counting With Methods Used in the Integrated Resource Planning Proceeding (p. 2)
A. Removal of the Exceedance Step (p. 2)
ACP supports removing the exceedance step for the 2026 and 2027 compliance years to improve the accuracy of qualifying capacity (QC) profiles for wind and solar resources.
Reasoning: The exceedance step limits the capacity contribution of renewable resources without providing additional accuracy or program benefits.
Support from Stakeholders: Multiple parties back this change as a means to simplify and improve the resource counting process.
B. SERVM Alignment (p. 3)
Advocates for replacing exceedance profiles with SERVM weather profiles to align with stochastic modeling used in RA Loss of Load Expectation (LOLE) studies.
Stakeholder Review: Recommends stakeholder review of data sources and processes for developing SERVM inputs to ensure alignment with both RA and IRP objectives.
Implementation in Track 3: Proposes integrating this analysis into Track 3 and calls for collaboration between Energy Division and stakeholders.
II. The Commission Should Focus the Unforced Capacity Methodology on Curtailments and Outages Rather Than State-Of-Charge (p. 4)
ACP supports the PD’s direction to prioritize forced outages and curtailments over state-of-charge data for UCAP calculations, particularly for energy storage resources.
Reasoning: This focus ensures a robust and fair assessment of capacity contributions, avoiding inaccuracies from historic periods when UCAP rules were not established.
Collaboration with CAISO: Stresses the importance of aligning UCAP development timelines and processes with CAISO’s parallel efforts to harmonize outage reporting and resource participation rules.
Conclusion (p. 4)
ACP appreciates the opportunity to contribute to Track 2 discussions and supports continued stakeholder engagement in Track 3 to refine methodologies for renewable resource counting and UCAP development.
I. Introduction (p. 1)
CESA emphasizes its goal to ensure equitable and efficient resource adequacy mechanisms, focusing on clarity and fairness in CPE frameworks and advocating for accurate UCAP methodologies for energy storage resources.
II. The Proposed Decision’s Description Of The CESA And WPTF Soft-Offer Price Cap Proposals Exclude Key Details That Resolve Stated Concerns With The Proposals (p. 3)
The soft-offer price cap proposal includes provisions for CPEs to defer procurement when bids are below the price cap, addressing market power concerns.
Transparency is ensured through a mechanism requiring CPEs to justify bid rejections in compliance reports.
The proposal aligns with Commission practices by enabling waivers in cases of market power while maintaining least-cost, best-fit evaluation flexibility.
III. The Rationale For Rejecting To Adopt A Soft-Offer Price Cap Within The CPE Framework Contradicts Prior Commission Determinations In Establishing Transparent Price Triggers For Local Waivers Still Applicable To Some LSEs (p. 4)
CESA argues that transparent pricing triggers, as used in local RA waivers, mitigate market power concerns effectively.
Historical precedents demonstrate the success of such mechanisms in ensuring fairness across jurisdictions.
Transparent caps do not inherently result in uncompetitive behavior but enhance accountability and consistency in procurement decisions.
IV. The Proposed Decision Appropriately Recognizes That Only Forced Outages Due To Equipment Failures, Not State-Of-Charge, Should Be Used To Derive UCAP Values For Energy Storage Resources (p. 5)
Excluding state-of-charge limitations from UCAP calculations ensures fair evaluation of energy storage compared to conventional resources.
Forced outages due to equipment failures are a more accurate and equitable metric for assessing storage reliability.
V. Conclusion (p. 8)
CESA supports measures that promote fairness in RA practices and accurate capacity valuations, while emphasizing its commitment to refining frameworks and methodologies.
I. Introduction (p. 1)
Middle River Power LLC (MRP) expresses concerns about several aspects of the Proposed Decision (PD) and provides recommendations for improving the Planning Reserve Margin (PRM) process, adopting a clear reliability metric, refining qualifying capacity (QC) methodologies, and adjusting Central Procurement Entity (CPE) timelines.
II. Summary of Opening Comments (p. 2)
MRP provides a brief overview of its key recommendations, including revising the PD to:
Define a process and schedule for setting and updating PRMs.
Synchronize updates of PRM and QC values.
Clarify the use of synthetic data for QC methodologies for wind and solar resources.
Formally adopt a 0.1 Loss of Load Expectation (LOLE) standard or establish a process to adopt an alternative metric.
Reassess the adoption of the revised CPE timeline.
Reevaluate the rejection of MRP's proposal for releasing capacity under CPE contracts to enable longer-term agreements.
III. Opening Comments (p. 3)
A. The PD Should Be Revised to Include a More Complete and Detailed Process and Schedule for Setting the PRM (p. 3)
Concerns About Current Process: The lack of a rigorous schedule and inadequate time for stakeholder engagement may undermine the effectiveness of PRM updates.
Recommendations: Proposes setting a detailed schedule for LOLE and PRM updates, including workshops and opportunities for stakeholder feedback. Suggests accelerating the 2026 PRM decision timeline to March 2025 to ensure LSEs have sufficient time to procure capacity.
B. The PD Should Be Revised to Formally Adopt a 0.1 Loss of Load Expectation Target for the Resource Adequacy Program (p. 6)
Legislative Alignment: Argues that AB 2368 requires the adoption of a robust reliability standard, such as 0.1 LOLE, to ensure compliance.
Recommendation: Advocates for formally adopting the 0.1 LOLE metric as the RA reliability standard. If deemed unsuitable, suggests directing Energy Division to establish an alternative metric with input from stakeholders.
C. The PD Should Be Revised to Clarify Potential Changes to the QC Methodology for Wind and Solar Resources (p. 7)
Inconsistent Approaches: Points out contradictions between the PD’s authorization of SERVM weather profiles and prior Commission decisions rejecting synthetic data for QC methodologies.
Clarification Needed: Requests a clearer explanation of how SERVM profiles will be integrated and applied to ensure stakeholders understand proposed QC changes.
D. The PD Erred in Adopting a Proposal to Lock in CPE Procurement Two Years in Advance (p. 8)
Potential Risks: Warns that locking in CPE procurement two years in advance may lead to CAISO backstop procurement if local capacity requirements are unmet.
Recommendation: Recommends delaying adoption of this proposal to allow further consideration in Track 3 to minimize reliance on backstop procurement and ensure adequate local capacity.
E. The PD Erred in Rejecting MRP’s Proposal (p. 9)
Misrepresentation of Proposal: Asserts that the rejection was based on a misinterpretation of MRP’s recommendation to release capacity under CPE contracts for longer-term agreements.
Clarification: Proposes allowing mutually agreed capacity releases between LSEs and generators to improve procurement flexibility and reduce costs.
IV. Conclusion (p. 10)
MRP requests the PD be revised to incorporate its proposed changes, including a robust PRM process, adoption of a 0.1 LOLE standard, clarification of QC methodologies, and reassessment of CPE-related policies to ensure a reliable and efficient RA framework.
I. Introduction (p. 1)
Microsoft commends the Proposed Decision (PD) for advancing resource adequacy (RA) through biannual LOLE studies, UCAP methodology development, and local RA refinements. As a major energy consumer, Microsoft emphasizes the importance of reliability and sustainability in supporting its operations and climate goals.
II. Microsoft Supports the Proposal to Adopt an LOLE Study as Part of the RA Proceeding on a Biannual Basis, and for the Acceptance of a 0.1 LOLE as the Reliability Standard per AB 2368 (p. 3)
Biannual LOLE Studies: Microsoft supports aligning studies with the Integrated Energy Policy Report (IEPR) cycle for accuracy and consistency.
0.1 LOLE Standard: Endorsed as the industry benchmark, aligning RA requirements with IRP standards.
Efficiency: Biannual updates allow for thorough stakeholder engagement and accurate modeling, avoiding outdated forecasts.
III. Microsoft Appreciates the PD Committing to Staff-Led Workshops to Further Review the Methodology of the Existing LOLE Study, as Well as the Subsequent Stress Tests and Slice of Day Calibration (p. 5)
Workshops: Encourages workshops to clarify methodologies, particularly regarding the Slice of Day calibration and stress tests.
Procurement Concerns: Warns that Slice of Day may result in over-procurement by LSEs, increasing costs for ratepayers.
PRM Adjustments: Recommends separating PRM adjustments caused by Slice of Day from other reliability metrics to ensure transparency.
A. Specific Recommendations for Energy Division-Led Workshops (p. 7)
Review of Assumptions: Suggests workshops delve into LOLE inputs, resource availability, and methodological changes.
Stress Test Analysis: Requests explanation of calibration impacts on PRM and comparisons to previous ELCC-based methods.
Robust Stakeholder Engagement: Calls for detailed discussions to ensure consensus on methodologies before final adoption.
IV. While Microsoft Has Been an Advocate for the Speedy Development of a UCAP Methodology, We Understand That the Commission’s Resources Are Constrained and Hope That Collaboration Between Energy Division and CAISO Leads to a UCAP Methodology Consistent with Maintaining Reliability Standards (p. 8)
Collaboration with CAISO: Supports integration of CAISO’s data-driven insights into UCAP development.
Robust Methodology: Advocates for derating mechanisms for both thermal and storage resources, accounting for climate impacts and reliability.
Timeline: Urges expedited completion of the UCAP methodology to enhance grid reliability by 2028 or earlier.
V. Microsoft Agrees with the PD That the Local RA Construct and the CPE Should Not Be Dismantled, as It Is Critically Necessary for Maintaining Reliability by Ensuring Appropriate Resource Availability in Local Areas (p. 10)
Local RA Framework: Agrees that dismantling local RA would undermine reliability in transmission-constrained areas.
CPE Effectiveness: Supports PD proposals to enhance CPE reporting and refine procurement timelines.
A. Microsoft Supports the PD’s Adoption of Proposals That Will Make the Local RA Program More Effective (p. 12)
Earlier Allocations: Advocates for locking in CPE allocations one year in advance to enable better procurement and reduce market volatility.
Improved Data Sharing: Backs aggregated LSE contract data sharing with CPEs to minimize over-procurement risks.
B. The Commission Should Develop a New Approach to Address and Plan for Gas Plant Retirements in Local Areas, as Raised by CEJA and Sierra Club (p. 13)
Long-Term Planning: Proposes creating a dedicated IRP track for addressing aging gas plant retirements and planning for replacement capacity.
Environmental and Reliability Goals: Encourages solutions that balance local reliability with clean energy transitions.
VI. Conclusion (p. 14)
Microsoft supports the PD’s measures for improving RA, including biannual LOLE studies, expedited UCAP methodology development, and enhancements to the CPE framework. It emphasizes the importance of stakeholder engagement, clear methodologies, and forward-looking planning to maintain grid reliability and affordability.
I. Introduction (p. 1)
The California Efficiency + Demand Management Council, Leapfrog Power, Inc., and OhmConnect, Inc. (collectively, "DR Parties") commend the Proposed Decision (PD) for adopting most of the Load Impact Protocols (LIP) Simplification Working Group recommendations. They seek modifications to ensure future opportunities for improving unresolved issues related to protocols.
IV. The DR Parties Support Keeping the Door Open to Future Proposals on Unresolved Issues (p. 3)
Protocols 1 and 3: Appreciate the PD’s encouragement for future proposals to improve these protocols, acknowledging the importance of continuing efforts to refine demand response (DR) measurement practices.
Protocols 7 and 21: Request the PD be modified to extend similar encouragement for future proposals on these protocols, emphasizing the need for further record development to address outstanding issues.
Resource Constraints: Recognize the Commission’s staffing limitations but stress the importance of leaving pathways for future refinements to protocols critical to DR program success.
I. Summary (p. 1)
The California Environmental Justice Alliance (CEJA) and Sierra Club support many elements of the Proposed Decision (PD), including reforms to the Central Procurement Entity (CPE) framework and the delay in adopting the Planning Reserve Margin (PRM). However, they request modifications to address local procurement incentives, transparency, and the evaluation of reliability metrics to ensure affordability and environmental benefits.
II. Discussion (p. 2)
A. The Proposed Decision Should Be Revised to Include Local Procurement Incentives in Track 3 (p. 2)
CPE Framework Challenges: The CPE has failed to incentivize clean local resource development or generate competitive procurement conditions.
Gas Plant Reliance: Highlights the need to transition from uneconomic gas plants to clean resources, particularly in disadvantaged communities.
Coordination Between RA and IRP: Urges proactive coordination between RA and Integrated Resource Planning (IRP) proceedings to address local reliability needs and greenhouse gas reduction goals.
Proposed Revision: Recommends including locational incentives for clean resources in Track 3 of the RA proceeding to displace reliance on gas generation.
B. Increased Reporting to CPEs on Local Resource Needs Should Be Shared Transparently and Feedback Should Be Actively Solicited (p. 5)
Transparency in Data Sharing: Supports the PD’s authorization for collecting anonymized data on contracted local RA capacity but recommends making this data accessible to stakeholders.
Stakeholder Engagement: Proposes additional safeguards, such as stakeholder advisory groups, to enhance transparency and accountability in the CPE process.
Clean Resource Prioritization: Advocates for explicit guidance requiring CPEs to prioritize contracts with clean resources.
C. The Proposed Decision Erroneously Misinterprets CEJA and Sierra Club’s Proposal (p. 5)
Clarification of Intent: CEJA and Sierra Club clarify that their proposal seeks an analysis of reliability assumptions underlying the LOLE standard rather than a new reliability definition.
SDG&E Misinterpretation: Notes that opposition from SDG&E was based on a misreading of their proposal, and the PD should reflect this clarification.
D. The Proposed Decision Errs Defaulting to a LOLE Standard with No Analysis (p. 6)
Reliability Standard Options: Criticizes the blind adoption of the 0.1 Loss of Load Expectation (LOLE) standard without considering alternative metrics like Loss of Load Hours (LOLH) or unserved energy.
Legislative Mandates: Argues that Assembly Bill (AB) 2368 requires the Commission to evaluate the most efficient and equitable reliability standard.
Full Procurement Modeling: Highlights gaps in the LOLE study, such as excluding some programs like the Emergency Load Reduction Program (ELRP) from modeling.
Proposed Action: Recommends analyzing alternative reliability metrics and incorporating all procurement in future LOLE studies.
E. The Proposed Decision Errs by Assuming That the Commission’s Historic Interpretation of LOLE Is “General Industry Standard” (p. 8)
Ambiguity in LOLE: Points out that LOLE is inconsistently applied across jurisdictions, and California’s interpretation does not reflect a universal standard.
Emerging Trends: Notes reevaluations of LOLE by entities like ERCOT and the North American Electric Reliability Corporation (NERC) in response to evolving grid conditions.
Recommendation: Advocates for an examination of core LOLE assumptions to ensure alignment with affordability, reliability, and environmental goals.
III. Conclusion (p. 9)
CEJA and Sierra Club request modifications to the PD to:
Address local procurement incentives in Track 3.
Improve transparency and accountability in the CPE framework.
Evaluate alternative reliability metrics and assumptions underlying LOLE.
Appendix A includes proposed changes to findings of fact, conclusions of law, and ordering paragraphs to incorporate these recommendations.
I. Introduction (p. 1)
The Protect Our Communities Foundation (PCF) supports the Proposed Decision (PD) on many aspects but proposes key modifications to improve modeling, resource adequacy (RA) frameworks, and cost transparency. PCF emphasizes prioritizing clean and distributed energy resources and opposes mechanisms that could increase electricity rates without tangible benefits.
II. The PD Appropriately Postpones Adopting a PRM Because of the Anomalous LOLE Study Results That Generated an Excessively High PRM (p. 3)
Inconsistent Modeling Results: PCF agrees with the decision to defer the Planning Reserve Margin (PRM) adoption due to unexplained anomalies in the Loss of Load Expectation (LOLE) study, particularly for February.
Artificial Constraints: Criticizes Energy Division’s (ED) modeling for reducing import levels below historical values, leading to inflated PRM requirements and unnecessary costs for ratepayers.
Recommendations: Suggests correcting baseline assumptions in Track 3 to better reflect available resources and prevent excessive PRM levels.
III. The PD Should Incorporate BTM Solar and Storage Into All Models and the Load Impact Protocols (p. 5)
A. The RESOLVE and SERVM Models Incorrectly Include BTM Solar as a Forecast, Rather Than Optimizing BTM Solar Like All Other Generation Resources (p. 6)
Modeling Limitations: RESOLVE and SERVM treat behind-the-meter (BTM) solar as an immutable forecast rather than a candidate resource, which undervalues its benefits.
Proposed Changes: Recommends revising models to include BTM solar as a candidate resource, capturing its potential for greenhouse gas (GHG) reductions, reliability enhancements, and cost savings.
B. The PD Should Address PCF’s Proposal to Prioritize BTM Solar (p. 7)
Distributed Energy Resources (DERs): Supports prioritizing DERs, such as solar and storage on commercial buildings and parking lots, as faster and more cost-effective alternatives to utility-scale resources.
Request: Calls for the RA proceeding to explicitly prioritize DERs rather than deferring consideration to Integrated Resource Planning (IRP).
C. The PD Should Order a New Working Group to Include BTM Storage as Part of the Load Impact Protocols (p. 8)
Working Group Need: Proposes forming a new working group to establish qualifying capacity (QC) values for BTM solar and storage.
Parity with Other Resources: Establishing QC values would ensure BTM storage is treated equally to other resources in the RA framework.
IV. The Commission Should Reject the UCAP Proposal and Maintain Its Independent Authority to Oversee and Prevent Outages (p. 9)
UCAP Concerns: Opposes the Unforced Capacity (UCAP) proposal, which shifts oversight responsibilities to CAISO and overlooks whether forced outages are preventable through better maintenance.
Plant-Level Data: Recommends evaluating outages on a plant-specific basis to distinguish between operator-controlled and system-wide issues.
Legal Obligations: Highlights the Commission’s statutory responsibility under Public Utilities Code Section 761.3 to ensure optimal maintenance practices for in-state generation facilities.
V. The Commission Should Not Approve Any CPE Authorization That Includes Opportunity Costs or That Exceed Going Forward Fixed Costs (p. 11)
Market Power Concerns: Warns that incorporating opportunity costs into Capacity Procurement Entity (CPE) bids could encourage market manipulation and inflate electricity rates.
GFFC Cap: Advocates limiting bids to a facility’s Going Forward Fixed Costs (GFFC) to prevent unwarranted price increases.
Judicial Support: Cites a recent D.C. Circuit ruling in Shell Energy North America v. FERC, emphasizing the need for stricter cost controls to protect ratepayers.
VI. Conclusion (p. 14)
PCF requests the Commission adopt its proposed revisions to the PD, including:
Correcting modeling assumptions in the LOLE study.
Incorporating BTM solar and storage into all RA models.
Rejecting the UCAP proposal in its current form.
Limiting CPE bids to GFFC to prevent excessive costs.
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