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PUCT Staff Recommends Approval of Emergency EILS Procurement
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PUCT Staff have recommended that the Commission allow ERCOT to procure additional Emergency Interruptible Load Service (EILS) under a new contract period, and that the Commission limit such emergency authority to April and May 2011 (2/28).
ERCOT had filed an emergency petition with the PUCT to allow the additional procurement, without the otherwise required 90 days notice, due to the exhaustion of allowable deployments of EILS resources in the current period during the February 2 emergency event (Docket 39191).
Under the EILS program, an EILS resource shall be subject to a maximum of two deployments per EILS contract period, lasting no more than a total of eight hours per contract period, unless an EILS deployment is still in effect when the eighth hour lapses, in which case EILS deployment shall continue until ERCOT releases the EILS resource. EILS resources may return to service only after being released by ERCOT.
Based on these deployment limitations, ERCOT said that it is no longer permitted to deploy EILS Loads for the remaining portion of the EILS Contract Period covering February 1 through May 31, 2011, after deploying EILS resources for 28 hours during the February 2 emergency event.
Staff agreed with ERCOT that, "imminent peril to the public health, safety, or welfare," requires adoption of the additional procurement on an emergency basis, since the potential for extreme weather exists in the shoulder months of April and May, during which time generation capacity may be offline for scheduled maintenance. ERCOT needs EILS as a special emergency service during this time period to prevent against potential rolling outages, Staff agreed.
Staff recommended language for emergency amendments to Subst. R. 25.507 as follows:
"ERCOT may establish an additional EILS contract period of April 1 to May 31, 2011. ERCOT may give less than the 90 days' prior notice required in subsection (a)(2) for this contract period only. This paragraph expires on June 1, 2011."
Staff's language explicitly limits the additional EILS procurement authority to April through May 2011. Although this was ERCOT's intent, its originally proposed language was not explicit in this regard, and ERCOT was relying on the 120-day maximum allowable effective period for emergency rules to automatically cease such additional procurement authority after the April-May 2011 contract period, and revert the language of Subst. R. 25.507 to its original form. Staff found that listing an explicit end date in the amendments to be more appropriate.
Regarding performance of EILS resources in past contract periods, Staff noted that ERCOT has said that it will be in a position by the March 24th Open Meeting to speak about the overall performance evaluation of the QSEs and EILS Loads for the February 2-3, 2011 EILS deployment. Further, EILS Loads that failed their EILS availability requirements for the EILS Contract Periods covering October 2010 through January 2011 and February through May 2011 will be ineligible for procurement for the new EILS Contract Period, as well as EILS Loads that experienced dual test failures during the EILS Contract Period covering October 2010 through January 2011.
Staff found other concerns raised by intervenors to be outside the scope of ERCOT's petition or inappropriately addressed in an emergency petition.
As is current practice, ERCOT said that it may not procure EILS capacity in the emergency contract period if the MWs offered, "[are] not priced reasonably and therefore deemed sufficient to provide ERCOT with a useful operational tool." The cap of 1,000 MW will still apply.
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