Shell Energy North America has submitted to ERCOT Nodal Protocol Revision Request 864 (NPRR 864) which seeks to modify the RUC engine to consider fast-start Resources (<1 hr starts) as self-committed for future hours (all hours except the first hour).
"To minimize Reliability Unit Commitment (RUC) commitments, the RUC process needs to be modified to rely on highly probable potential market-based solutions before opting for out-of-market commits to ensure reliability. It is crucial to have the change implemented before the summer of 2018 due to the tight reserves which might increase the need for RUC under the current process," Shell said in its submission to ERCOT
Shell stated, "The RUC process needs to be modified to rely on highly probable potential market-based solutions before opting for out-of-market commitments to ensure reliability. The current RUC process is designed to look for least cost out-of-market commitment needed in addition to the market-based commitments reflected in (Current Operating Plans) COPs to reliability serve Load. With the change in generation portfolio, market-based commitment decisions could be made much closer to Real-Time than in the past and hence much more self-commitments materialize in Real-Time than is reflected in COPs many hours earlier."
Shell stated, "This NPRR helps minimize the need for RUC commitments as the RUC solution will reflect all potential market-based solutions. Relying on potential market-based solutions will minimize out-of-market commitments that seem needed at the time of RUC but become unnecessary due to wind forecast error, Load forecast error, or other self-commitments that happen after the COP snapshot for RUC is taken. In that way, the change supports ERCOT’s Strategic Pillar of making the market design flexible to accommodate changes in the market dynamics."
Shell stated, "This also allows time for market-based self-commitments to occur while keeping the option for the RUC engine to commit these resources in the first two hours if adequate self-commitments fail to materialize. This NPRR doesn’t disrupt any of the current RUC processes as it doesn’t change the current process related to Quick Start Generation Resources (QSGRs) or ERCOT Operators’ ability to manually commit any Resources at any time. Currently ERCOT Operators manually deselect RUC commitments of fast-start Resources until the last hour. This change also automates that process, and hence avoids potential operator error in that area."
Shell stated, "This change will help drastically reduce RUC commitments for capacity and thus improve market efficiency by maintaining reliability with minimal out-of-market actions. Implementing this NPRR will minimize RUCs without compromising reliability. Hence it helps maintain same level of reliability at lower make whole payment ($33 million from Nodal Market go-live) and lower potential for price suppression caused by RUC."