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Wednesday
Jun012016

ISO-NE incorporates wind-powered resources into real-time dispatch with Do Not Exceed Dispatch Project

The change helps improve price formation in the markets and marks an important milestone in ISO New England’s efforts to efficiently integrate renewable resources

On May 25, the region’s wind-powered resources and intermittent hydro resources began taking electronic dispatch instructions from ISO New England for the first time and became eligible to set real-time prices in the wholesale electricity marketplace. These changes were effected by the Do Not Exceed (DNE) Dispatch Project in which the ISO worked with stakeholders to implement a modified electronic dispatch method for these intermittent resources. The new system is expected to improve price formation in the marketplace and system use of low-cost renewable resources in areas with limited transmission capacity by:

  • Enabling wind and intermittent hydro resources to set the price at their locations on the basis of their economic offers
  • Allowing the Real-Time Energy Market to properly price congestion at their locations

The changes are also expected to minimize manual generator curtailments and improve the ISO’s ability to manage the system during rapidly shifting weather conditions.

Finding ways to accommodate intermittent generation

Previously, the ISO was unable to electronically dispatch wind and intermittent hydro generators because their output isn’t easy to control, depending as it does on weather, seasonal river flows, and other factors. This is in contrast to generators running on conventional fuels (natural gas, oil, etc.), which have more flexibility to start up, shut down, or change output in response to ISO instructions. As a result, variable generators were typically allowed to run at will under normal conditions.

However, this nondispatchability meant that variable resources could not set real-time prices in the region’s energy market, despite their typically low offers. It also meant that the ISO’s unit dispatch system couldn’t send them electronic instructions to help economically manage congestion in their area. Instead, ISO system operators had to manually direct these resources to reduce generation if their maximum output could exceed what the transmission system could handle, and these manual instructions are generally not reflected in locational marginal prices (LMPs).

Now, new processes and systems accommodate the variable nature of these resources’ fuel; determine the maximum amount of economic intermittent energy the system can support without sacrificing system reliability; and automate communications between the ISO and resources. As part of the DNE Project:

  • The ISO’s new electronic dispatch method sets a do-not-exceed limit for a participating intermittent power resource: the upper limit of how much generation the system can accommodate. The resource may operate freely between their economic minimum limit and the DNE limit, but not over. In contrast, conventional generators are typically dispatched at specific output levels.
  • Starting June 1, 2019, all DNE dispatchable generators (DDGs) with a capacity supply obligation must offer into the Day-Ahead Energy Market based on their expected generation, which will make the Day Ahead Market solution more closely resemble real-time conditions, leading to a more accurate commitment of resources.
  • DDGs installed remote terminal units (RTUs) necessary to automate the determination and communication of real-time telemetered DNE dispatch instructions. DNE limits and other dispatch signals are normally transmitted every five minutes.

See the DNE Project Customer Readiness page to learn about required actions for affected market participants and related changes to existing systems or procedures.

Highly accurate wind forecasting

To be able to determine the DNE limit for wind-powered resources, the ISO has developed sophisticated systems and processes. Every five minutes, ISO systems and operators must evaluate a wind resource’s:

  • Current output
  • Wind high limit—the plant operator’s “nowcast” of output (if not constrained) with current wind conditions and operational status of wind turbines
  • Real-time high operating limit—the plant operator’s estimate of what the plant could produce under optimal wind conditions
  • P50 forecast—the ISO’s projection of a 50% probability of exceedance of plant output, which leverages the ISO’s wind power forecast, introduced in 2013. (See the Seven-Day Wind Power Forecast.)

Cutting-edge analysis

The improved real-time dispatch is the result of the ISO’s pioneering application of a powerful risk-management modeling tool in the electricity industry, developed in collaboration with university researchers. The computational strategy better quantifies and solves for today’s unprecedented levels of uncertainty in real-time operations related to how much power will be available to supply the grid or demanded from it as more weather-dependent wind and solar resources come on line, as well as more demand resources. The new model yields both increased power system reliability and minimized dispatch costs, for a sizable savings, and remains effective as uncertainty levels increase. Read more in “ISO-NE’s research recognized internationally by INFORMS.”