Texas PUC Commissioner Opposes Approval Of ERCOT "State of Charge" NPRR For Energy Storage

November 29, 2023

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Copyright 2010-23 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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Texas PUC Commissioner Jimmy Glotfelty filed a memo in advance of tomorrow's open meeting opposing approval of ERCOT NPRR 1186, relating to the state of charge for energy storage resources (ESR)

ERCOT has said in support of the NPRR that it, "specifies existing and new information to be provided by the QSE so that ERCOT can better understand each ESR’s current energy capability and expected energy capability in future hours."

However, Glotfelty says that the NPRR would adopt, "discriminatory ... burdensome operational requirements on storage devices," including higher non-compliance penalties.

"It is my belief that NPRR 1186 has not been adequately studied, discussed, and justified at this time and therefore I oppose its approval. NPRR 1186 seems to be a proposed solution in search of a problem," Glotfelty said

"ERCOT asserts that the point of NPRR 1186 is to improve 'the awareness, accounting and monitoring of the State of Charge (SOC)' for an Energy Storage Resource. In fact the NPRR as proposed sets operational limits and potential compliance fines upon storage resources even as those resources are making outsized contributions to ERCOT reliability. Furthermore, since ERCOT has not yet adopted any protocols regarding the real-time state of fuel availability for coal or gas plants, it would be discriminatory to adopt burdensome operational requirements on storage devices when no such requirements are placed upon thermal plants," Glotfelty said

"Once Real Time Co-Optimization (RTC) is complete, this issue goes away, so this is really a proposal for the next 2 years, at the time we need the most flexible resources on the system as possible. Evidence on the September 6th EEA event and throughout the past summer show that batteries are making the system MORE reliable, especially on days when forced thermal outages are high and unexpected," Glotfelty said

"This Commission and ERCOT must value and incentivize flexibility, not penalize it," Glotfelty said

"NPRR 1186 is increasing the non-compliance penalties on batteries relative to other resources because the other resources are only penalized AFTER they fail to deliver as committed, but the SOC provisions would penalize preemptively BEFORE any actual failure to deliver. And when ERCOT approved this NPRR they asked for yet another penalty structure for violations to this NPRR. If we pass this as requested by ERCOT and approve the follow-on penalty that they requested, then storage will have no way to even understand what penalty structure they will be facing in the market. This seems problematic and a disincentive to me. We need ERCOT to admit they can see current SOC of large batteries and with the industry that they do not yet operationally understand. This State of Charge (SOC) issue, if handled correctly, may be the carrot to get Real Time Co-Optimization (RTC) done quickly," Glotfelty said

Glotfelty offered the following for PUC consideration, in addition to outright rejection of the NPRR:

• Have Commission Staff initiate a project and rulemaking to better hash out the state of charge issue.

• Delay approving NPRR 1186 until the Independent Market Monitor (IMM) can evaluate whether adoption of NPRR 1186 as now written could cause regulatory-forced withholding of battery capacity from ERCOT's ancillary services markets or discourage some proposed storage projects from investing in ERCOT. "We should also ask the IMM to study the economic impact on the ERCOT markets of withholding a large portion of battery capacity from the energy and ancillary services markets (including congestion costs)," Glotfelty said

• Consider deleting all the penalty provisions in the current NPRR 1186 proposal, as well as follow-on NPRRs, and adopt only the data collection and monitoring provisions.

Project 54445

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