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ERCOT proposal requiring pipeline disclosures raises stakeholder concerns


Confidentiality commitments at issue

Other rule, system changes approved

Houston — Electric Reliability Council of Texas stakeholders voiced concern Thursday about a proposed rule that would require gas-fired generators to provide detailed information about the status and potential problems with their feedgas pipelines. Ultimately, consideration of the proposal was postponed to allow formal comments to be filed.

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ERCOT's Protocol Revision Subcommittee approved the urgency status of Nodal Protocol Revision Request 997, Gas Pipeline Coordination for Natural Gas Generation Resources, which Therese Harris, Public Utility Commission of Texas director of infrastructure analysis, said the PUC hopes to be in effect for the summer of 2020.

Filed February 7, the proposed rule change would require a gas-fired generation operator "to submit a declaration contained in the summer weather preparedness form to ERCOT [...]." This would state that the operator "has made a written effort to communicate with the operator of each natural gas pipeline that is directly connected" to the generator "to coordinate any planned pipeline outages to maximize the Generation Resource's availability during the summer Peak Load Season of that year," according to the rule's description filed at ERCOT.

In particular, a generation operator would have to disclose the following:

  • The identity of a particular pipeline, and its operator, if known, that has or is expected to have "activities or conditions" that might affect the generator's availability at peak,
  • The reason for the activities or conditions, if known,
  • The impact of the activities or conditions on the generator's availability, either being offline or being derated, if known, and
  • The time period of the activities or conditions, if known.

The proposed change "is an outgrowth" of a PUC initiative begun in November 2018 as a result of the tight supply conditions the previous summer, Harris said.

Confidentiality commitments

But Michele Gregg, Texas Competitive Power Advocates executive director, said her gas-fired generation members usually have long-term agreements with pipeline operators that forbid disclosure of certain types of confidential information, which may include some of the information described in NPRR 997.

Furthermore, employing the legal expertise to verify what can be disclosed can be costly, Gregg said.

Also, generation owners would like the rule change to include "hold harmless" language that would eliminate penalties for noncompliance if data supplied to ERCOT by generators based on information received from pipeline operators ultimately is found to be erroneous.

"This is a solution in search of a problem," Gregg said. "[Generators] want to operate during the summer. There are no resources in this room that don't want to be operating in summer. ... This is not a reliability issue. This is an 'I want more information' issue."

Doug Fohn, an ERCOT senior corporate counsel, said, "I think we can work through all these issues" in time for the rule to be in effect for the summer of 2020.

"We can't make a rule that is going to cause you to break a contract," Fohn said.

If a generation operator sends an email requesting the information to the appropriate person at the pipeline company, and that person fails to respond with complete information, "you have done your duty," Fohn said.

But Ian Haley, an ERCOT regulatory director at Vistra Energy who represents the independent generator segment on the Protocol Revision Subcommittee, said receiving information from a pipeline may not be sufficient to be able to advise ERCOT about pipeline activities' effects on generators.

"When we get told that X, Y and Z is happening, we may understand what that means, or we may not," Haley said.

Clayton Greer, a Morgan Stanley vice president for commodities who represents independent power marketers on the Protocol Revision Subcommittee, said the proposed rule change presents "burden of proof" issues.

"You have to prove that what information they provided you was inaccurate, not what you provided to ERCOT was inaccurate," Greer said, an issue that can significantly complicate compliance disputes.

Other rule, system changes

After postponing consideration of NPRR 997 for one month, the Protocol Revision Subcommittee endorsed the following changes so they can be considered by ERCOT's Technical Advisory Committee during its February 26 meeting:

  • NPRR 907, which would declare 7 pm before the operating day as the latest time that DAM results can publish, and require that if the day-ahead market results are delayed, ERCOT must issue a market notice no later than 5 pm central time on the next business day. This has no estimated implementation cost and can be implemented upon board approval.
  • System Change Request 807, which would increase the congestion revenue rights transaction limit from 300,000 to 400,000 for CRR account holders during CRR auctions, estimated to cost between $50,000 and $100,000, to be implemented in 2020.