Mar 18, 2003 1

TAC Report to the ERCOT TAC Report to the ERCOT BoardBoard

March 18, 2003March 18, 2003

Mar 18, 2003 2

SummarySummary• OGRRsOGRRs

• Generation Adequacy ReportGeneration Adequacy Report

• PUCT filing by WMSPUCT filing by WMS

• PRRs 374, 380, 388 and 395 - votePRRs 374, 380, 388 and 395 - vote

• Recommendation of A/S bid limit related to Recommendation of A/S bid limit related to PRR 342 - votePRR 342 - vote

• Protocol/Profiling Guides waiver request - voteProtocol/Profiling Guides waiver request - vote

• Recommendation on resumption of True-Up Recommendation on resumption of True-Up Settlements for 2002Settlements for 2002 - vote - vote

Mar 18, 2003 3

Operating GuidesOperating Guides

• TAC approved OGRRs - 122, 124, 125, and TAC approved OGRRs - 122, 124, 125, and 126126– All related to keeping Operating Guides All related to keeping Operating Guides

consistent with Protocolsconsistent with Protocols

Mar 18, 2003 4

Generation AdequacyGeneration Adequacy

• TAC approved a report from the Joint Generation TAC approved a report from the Joint Generation Adequacy TF, including three recommendations.Adequacy TF, including three recommendations.– Definition / description of ERCOT reserve margin Definition / description of ERCOT reserve margin

calculationcalculation

– Assumptions and data inputs for next ERCOT Assumptions and data inputs for next ERCOT generation reserve margin study - to be completed in generation reserve margin study - to be completed in early 2004early 2004

– Use traditional LOLE methodology for next study, with Use traditional LOLE methodology for next study, with sensitivity analysis around costs of reserve margin sensitivity analysis around costs of reserve margin target. Explore costs of utilizing more rigorous market-target. Explore costs of utilizing more rigorous market-based methodology.based methodology.

Mar 18, 2003 5

WMS input to Market Design WMS input to Market Design

• February 20th, WMS was requested by February 20th, WMS was requested by Comm. Perlman to provide feedback by Comm. Perlman to provide feedback by March 10th on a proposed roadmap for March 10th on a proposed roadmap for evolving ERCOT’s market model.evolving ERCOT’s market model.

• WMS met Feb. 26th and March 7th to WMS met Feb. 26th and March 7th to develop a response, which was filed in develop a response, which was filed in #26376.#26376.

Mar 18, 2003 6

PRR 374 – RMR Text ChangesPRR 374 – RMR Text Changes

• Conforms RMR text to prior changes in Conforms RMR text to prior changes in Day-Ahead timelineDay-Ahead timeline

• Clarifies use of RMR energyClarifies use of RMR energy

• Corrects typosCorrects typos

• No impact to ERCOT computer systemsNo impact to ERCOT computer systems

• Effective April 1, 2003Effective April 1, 2003

Mar 18, 2003 7

PRR 380 - Black Start ServicePRR 380 - Black Start Service

• Approved Urgent status to meet RFP Approved Urgent status to meet RFP release date for 2004 Black Start Resourcesrelease date for 2004 Black Start Resources

• Clarifies Black Start requirementsClarifies Black Start requirements

• Recommends Black Start TF address issues Recommends Black Start TF address issues raised in commentsraised in comments

• No impact to ERCOT computer systemsNo impact to ERCOT computer systems

• Effective April 1, 2003Effective April 1, 2003

Mar 18, 2003 8

PRR 388 - BULs Capacity PaymentPRR 388 - BULs Capacity Payment

• Approved Urgent status because project is Approved Urgent status because project is “in flight”“in flight”

• Clarifies allocation methodology for BUL Clarifies allocation methodology for BUL activityactivity

• Facilitates ongoing system development; no Facilitates ongoing system development; no existing computer system impactexisting computer system impact

• Effective April 1, 2003Effective April 1, 2003

Mar 18, 2003 9

PRR 395 - Declare Backup Plans PRR 395 - Declare Backup Plans Protected InformationProtected Information

• Approved Urgent status due to the sensitivity Approved Urgent status due to the sensitivity of information and the deadline for its of information and the deadline for its submittalsubmittal

• Adds Protocol required backup plans from Adds Protocol required backup plans from QSEs and Transmission Operators to the list QSEs and Transmission Operators to the list of Protected Information.of Protected Information.

• No impact to ERCOT computer systemsNo impact to ERCOT computer systems

• Effective upon Board approvalEffective upon Board approval

Mar 18, 2003 10

PRR 342 follow upPRR 342 follow up

• PRR 342 was approved with a placeholder PRR 342 was approved with a placeholder for the amount that a bid for a ‘lower for the amount that a bid for a ‘lower quality’ Ancillary Service may exceed the quality’ Ancillary Service may exceed the bid for a ‘higher quality’ Ancillary Service, bid for a ‘higher quality’ Ancillary Service, when those bids are for the same capacity when those bids are for the same capacity

• TAC recommends the Board set the TAC recommends the Board set the placeholder value equal to 20%. placeholder value equal to 20%.

Mar 18, 2003 11

Direct Load Control Beta testDirect Load Control Beta test

• Waivers are required to implement a Direct Waivers are required to implement a Direct Load Control pilot program this summerLoad Control pilot program this summer– From Protocol 18.2.9, requiring 150 day notice From Protocol 18.2.9, requiring 150 day notice

prior to implementing a Load Profile change.prior to implementing a Load Profile change.– From Load Profiling Guides 12.4, prohibiting From Load Profiling Guides 12.4, prohibiting

profile changes during June - September.profile changes during June - September.

Mar 18, 2003 12

TAC recommendationTAC recommendation

Protocols Section 18.2.9 “Adjustment and Protocols Section 18.2.9 “Adjustment and Changes to Load Profile Development” and Load Changes to Load Profile Development” and Load Profiling Guides Section 12.4 “Process Timing for Profiling Guides Section 12.4 “Process Timing for Requesting Changes” be waived to implement the Requesting Changes” be waived to implement the Beta Test Proposal and restrictions as presented Beta Test Proposal and restrictions as presented by ERCOT and that the TAC directs Green by ERCOT and that the TAC directs Green Mountain to submit a PRR to that effect on an Mountain to submit a PRR to that effect on an urgent timeline to the PRS for TAC action at its urgent timeline to the PRS for TAC action at its April meeting. April meeting. 

Mar 18, 2003 13

ERCOT Staff suggestionERCOT Staff suggestionThe Board agrees that Protocols Section 18.2.9 “Adjustment and Changes to Load Profile Development” and Load Profiling Guides Section 12.4 “Process Timing for Requesting Changes” should be revised to allow implementation of a limited “Beta Test” of Direct Load Control Program in the summer of 2003 with restrictions as required by ERCOT Staff. THE BOARD REQUESTS THAT Green Mountain submit a PRR to effect required Protocols revisions to allow for the Beta Test on an urgent timeline to the PRS for TAC action at its April meeting and for Board action at the April Board meeting.  Green Mountain is further directed to initiate and obtain approval for revisions to the Load Profiling Guides to allow for the Beta Test prior to June 1, 2003.

Mar 18, 2003 14

True Up Restart RecommendationTrue Up Restart Recommendation• True-up settlements for 2002 shall begin 60 days after the initial release of the True-up settlements for 2002 shall begin 60 days after the initial release of the

SCR 727 data. [March 13 --> SCR 727 data. [March 13 --> May 12May 12]]

• MPs will have up to 30 days prior to the scheduled settlement date for a particular MPs will have up to 30 days prior to the scheduled settlement date for a particular operating day to identify variances in the data extract pursuant to procedures to be operating day to identify variances in the data extract pursuant to procedures to be developed by ERCOT. Should a MP raise an issue in a true-up dispute, ERCOT developed by ERCOT. Should a MP raise an issue in a true-up dispute, ERCOT shall consider the MP’s compliance with this resolution in evaluating that dispute.shall consider the MP’s compliance with this resolution in evaluating that dispute.

• ERCOT shall present a resolution for consideration by the RMS concerning the ERCOT shall present a resolution for consideration by the RMS concerning the process for variance resolution. This resolution shall be processed in a timeframe process for variance resolution. This resolution shall be processed in a timeframe such that a resolution concerning the variance resolution process will be presented such that a resolution concerning the variance resolution process will be presented to the Board at its March 2003 meeting. The process shall identify specific to the Board at its March 2003 meeting. The process shall identify specific responsibilities and timelines for variance resolution. ERCOT shall coordinate responsibilities and timelines for variance resolution. ERCOT shall coordinate and report compliance with the variance resolution process.and report compliance with the variance resolution process.

Mar 18, 2003 15

As a follow-up to the previous motion above, the RMS moves As a follow-up to the previous motion above, the RMS moves to suspend any further effort by all MPs for Market to suspend any further effort by all MPs for Market Synchronization Priority 5, DART and QRE until the ERCOT Synchronization Priority 5, DART and QRE until the ERCOT Board approves the 2002 True-Up Restart Criteria and Board approves the 2002 True-Up Restart Criteria and furthermore moves to cease any further efforts on Market furthermore moves to cease any further efforts on Market Synchronization and QRE upon Board approval of 2002 Synchronization and QRE upon Board approval of 2002 True-Up Restart Criteria. True-Up Restart Criteria.

MPs are obligated to complete Priorities 1, 2, 4MPs are obligated to complete Priorities 1, 2, 4(1)(1) no later no later than 30 days prior to the scheduled resettlement of the than 30 days prior to the scheduled resettlement of the effected trade date . This motion is intended to eliminate the effected trade date . This motion is intended to eliminate the possibility of a duplicate work effort. It was noted that issues possibility of a duplicate work effort. It was noted that issues can still be addressed on a day to day basis through FasTrak.can still be addressed on a day to day basis through FasTrak.

Mar 18, 2003 16