Proposed Market Operations changes to the Market Operations BPM

2.3.2Real-Time Market Processes

Bidding for the Real-Time Market (RTM) and HASP closes 75 minutes before the beginning of each Trading Hour (which in turn begins at the top of each hour). A sequence of processes determines the Market Clearing Prices for each Trading Hour. The prices resulting from these processes are used for the HASP and Real-Time Market Settlement.

The following subsections present an overview of these processes for the Trading Hour. Further details are presented in Section 7, Real-Time Processes.

2.3.2.1Market Power Mitigation & Reliability Requirements Determination

The MPM-RRD functions for the RTM and the HASP are analogous to the same functions that are performed for the DAM. For Real-Time, the MPM-RRD functions cover the Trading Hour and the resultant mitigated Bids are then used by the remaining Real-Time processes, including HASP and the RTM. Refer to Section 7.4, MPM-RRD for Real-Time.

The Day-Ahead Market and the HASP and Real-Time Markets require separate Bid submissions. MPM re-evaluates all Bids in HASP/RTM.

Mitigation in the DAM is a separate process from Real-Time mitigation. As a result, a Bid could be mitigated in the DAM but not be mitigated in the RTM, and vice versa.

2.3.2.2Hour-Ahead Scheduling Process

The Hour-Ahead Scheduling Process (HASP) is a process for scheduling Energy and AS based on the Bids submitted into the HASP and RTM from Scheduling Points. Refer to Section 7.5, Hour-Ahead Scheduling Process.

HASP is performed immediately after the Real-Time MPM-RRD. HASP produces: (1) HASP Advisory Schedules and advisory AS Awards for internal Generating Units and Dynamic System Resources; (2) final and financially binding HASP Awards for Non-Dynamic System Resources; and (32) HASP Intertie Schedules that are final and financially binding for SCs. All HASP Schedules for the Trading Hour are published approximately 45 minutes before the start of each Trading Hour.

The primary goal of the RTM is to identify supplies to meet the CAISO Forecast of CAISO Demand and export schedules. HASP determines HASP Intertie Schedules for hourly pre-dispatched resourcesNon-Dynamic System Resources for the applicable HASP Trading Hour (i.e., between T and T+60 minutes) on an hourly basis instead of on a 15-minute basis. This is accomplished by enforcing constraints that ensure that the HASP Intertie Schedules for the 15-minute intervals are equal. The LMPs used to settle the hourly HASP Intertie Schedules are computed as the simple averages of the four LMPs of the four 15-minute intervals of the Trading Hour, respectively. HASP also procures Ancillary Services from Non-Dynamic System Resources for the applicable HASP Trading Hour on an hourly basis. HASP Ancillary Services Awards are settled based on applicable hourly ASMPs.

2.3.2.3Real-Time Unit Commitment

Real-Time Unit Commitment (RTUC) is a market process for committing Fast and Short-Start Units and awarding additional AS from Dynamic System Resources at 15-minute intervals. The RTUC function runs every 15 minutes and looks ahead in 15-minute intervals spanning the current Trading Hour and next Trading Hour. Refer to Section 7.6, Real-Time Unit Commitment. Also refer to Exhibit 6-2, Generating Unit Commitment Selection by Application, for a summary of the Unit Commitment processes.

4.3.2Ancillary Services Procuredment in Real-Timee Market

Ancillary Services are procured in the Real-Time Market from resources internal to the ISO system and Dynamic System Resources, through the RTUC process, as needed to satisfy the MORC NERC requirements. In RTUC, AS may be procured from resources internal to the CAISO system.

Ancillary Services are procured on an hourly bassis in the HASP from Non-Dynamic System Resources.

Ancillary Services Awards for internal resources and Dynamic System Resources are only considered binding the first 15-minute interval of each RTUC run including the RTUC run supporting HASP. Ancillary Service Awards forom Non-Dynamic System Resources can be procured in the HASP run and are considered binding for the HASP Ttradeing Hhour. The resources that are committed in Real-Time to provide Imbalance Energy and/or AS are eligible for Start-Up and Minimum Load Cost compensation, except for non-Resource Specific System Resources. .

Additional AS are procured in Real-Time in HASP (Non-Dynamic System Resources) or the Real-Time Market (Generators and Dynamic System Resources) only from resources that are certified to provide these services.

Refer to Section 7.6.1.2, Real-Time Ancillary Services Procurement, for additional information.

4.5Ancillary Services Considerations

This section identifies important considerations in the use and procurement of Ancillary Services, including:

The Operating Reserve Ramp Rate for Energy within the AS capacity is a single Ramp Rate, which is distinct from the Operational Ramp Rate, and is the same for Spinning and Non-Spinning Reserve.

Energy Limits of resources bidding into the AS market can be managed by the use of the Contingency Only designation supplied by the SC in the AS Bid. The Contingency Only designation applies for the entire Trading Day. In Real-Time, Energy from Contingency Only Operating Reserves is only cleared against Demand only under Contingency situations.

Day-Ahead SC trades of Ancillary Service Obligations are supported, however, physical trades of Ancillary Services capacity is not.

In the DAM, Forbidden Operating Regions may limit the procurement of Ancillary Services. Specifically, the Regulation Up, Spinning Reserve, and Non-Spinning Reserve may be limited by the lower bound of a Forbidden Operating Region, if the optimal dispatch is below that Forbidden Operating Region, and Regulation Down may be limited by the upper bound of a Forbidden Operating Region, if the optimal dispatch is below that Forbidden Operating Region, unless that Forbidden Operating Region can be crossed within 20 minutes.

In the RTM, Forbidden Operating Regions constraint is not enforced. If the CAISO is not enforcing Forbidden Operating Region constraint in RTM, incremental A/S procurement in RTM from a resource will not be constrained by the Forbidden region of the resource.

Bids to export AS are not supported in the CAISO Markets.

Export of on-demand obligations of AS are manually supported but cannot be procured from the DAM or RTM.

All Spinning and Non-Spinning Reserves awarded in HASP or RTM are automatically classified as Contingency Only. Furthermore, any DA Spinning and Non-Spinning Reserve Awards are re-classified as Contingency Only if additional Spinning or Non-Spinning Reserve is awarded in the HASP or RTM. See CAISO Tariff Section 34.2.2. Any Spinning and Non-Spinning Reserve procured from non-Dyanmic System Resources are also considered contingency only.

Any AS designated as Contingency Only is not normally dispatched as Energy in the normal RTED mode. In the Real Time Contingent Dispatch (RTCD) mode, Energy behind Contingency Only AS and non-Contingency Only AS is not distinguished, and is dispatched economically

Contingency Only Reserves can also be dispatched by RTED under special circumstances. Section 34.3.2 and 34.8 of the CAISO tariff stipulates the conditions under which the CAISO can dispatch Contingency-Only Reserves.

Scheduling Coordinators are required to submit an Energy Bid for Non-Dynamic System Resources submitting an Ancillary Services bid in HASP or the Real-Time Market. However, the CAISO will only use the Ancillary Service Bid in solving the optimization problem and the associated Energy Bids will not be used in HASP. The ISO will, therefore, not Dispatch any Energy from the associated Energy Bid if there is no Ancillary Services awarded to the Non-Dynamic System Resource. If the Scheduling Coordinator fails to submit an Energy bid with an Ancillary Services AwardBid, the ISO will continue to generate an Energy bid for the associated default Energy Bid for the associated Ancillary Services Bid and will not use such bid to Dispatch Energy. See CAISO Tariff Section 30.5.2.6 and the BPM for Market Instruments.

7.2.2Interchange Transactions & e-Tagging

When submitting interchange transactions in the RTM, it is necessary to create an e-Tag. An e-Tag is required for all Energy Schedules and AS Awards at Scheduling Points, in accordance with NERC and WECC specifications. The following e-Tags are used:

Ancillary Service Bids – For the capacity e-Tag, the Energy profile equals zero. However, the transmission allocation profile is equal to the AS Award for DAM and equal to the AS offer in the HASP and RTM. When the AS is converted to Energy, the MW profile is increased accordingly.

Energy Schedules

Energy Self-Schedules including ETC and TOR Self-Schedules.

To enable CAISO to match the e-Tags with the relevant Balancing Authority Area Operator, the following market information must be included on each e-Tag:

Scheduling Coordinator ID

Energy Type

Transmission Right Identifier, i.e., Contract Reference Number (CRN), if applicable

Resource ID.

If an e-Tag is submitted before RTM is final and is correct, the e-Tag is approved with the following disclaimer. If HASP or RTM clears at a lower MW value than the tag’s transmission allocation, then the e-Tag is adjusted down to match the RTM output.

7.2.3.2Ancillary Service Awards

AS Awards are generated and sent through ADS for Generating Units and System Resources every fifteen minutes, as required for dispatchable resources. For Non-Dynamic System Resources AS awards will be sent to ADS for the target hour once an hour after each associated HASP run. The AS Award separately identifies the Day-Ahead Award, the Real-Time qualified self-provision, and the Real-Time AS Awarded Bid. Any Real-Time Award for Spinning and Non-Spinning Reserve are considered Contingency Only. AS procurement in the HASP and RTM is done optimally based on system conditions during each 15-minute RTUC interval. Because the CAISO must then maintain adequate reserves during the 15-minute interval, with no further opportunity for AS procurement, the HASP and RTM AS Awards are protected from being dispatched by RTED through designation as "contingency only". The CAISO will not Dispatch any Energy from the associated Energy Bid if there is no Ancillary Services awarded to the Non-Dynamic System Resource. See CAISO Tariff Section 30.5.2.6 and the BPM for Market Instruments.

7.3.3Execute Real-Time Applications

The following Real-Time applications are executed by CAISO after bidding for the market closes:

MPM-RRD (hourly)

HASP(hourly) – incorporates RTUC #1

STUC (hourly) – incorporates RTUC #2

RTUC (every 15-min) – #3 & #4

RTED (every 5 minutes)

RTCD (on demand)

RTMD (on demand)

The table shown by Exhibit 7-2 summarizes the execution of these applications.

Exhibit 72: Real-Time Applications

Application / Periodicity / Interval / Time Horizon / Task
MPM – RRD / Hourly
Beginning at
T-67.5’ / 15-min / 105 min / Market Power Mitigation and Reliability Requirement Determination for RTM Bids submitted at T–75’ for the Trading Hour from T to T+60’.
MPM-RRD for the Time Horizon from T minutes to T+60’
HASP
See Note 1 / Hourly
Beginning after MPM-RRD / 15-min / 105 min
’ / Hourly pre-dispatch for Non-Dynamic System Resources for the Trading Hour from T to T+60’.
Advisory 15-min dispatch for internal resources for the Trading Hour from T to T+60’.
Advisory 15-min AS Awards for internal resources for the Trading Hour from T to T+60’.
Binding hourly AS Awards for Non-Dynamic System Resources for the Trading Hour from T to T+60’.
STUC
See Note 2 / Hourly
Beginning at
T – 52.5’ / 15-min / 270 min / Unit Commitment for the Time Horizon from T–30’ to T+240’.
RTUC / 15-min
Beginning at midpoint of each 15-min period / 15-min / 105-60 min / Unit Commitment for the 105-60 min Time Horizon.
15-min AS Awards for non-Hourly System Resources, Dynamic System Resources and Generating Units for the first 15-min interval of the Time Horizon.
RTED / 5-min
Beginning at midpoint of each 5-min period / 5-min / 55-65 min / 5-min Dispatch for Dynamic System Resources and Generating Units for the first 5-min interval of the Time Horizon.
RTMD / On demand / 5-min / 5-min / 5-min Dispatch for Dynamic System Resources and Generating Units.
RTCD / On demand / 10-min / 10-min / 10-min Dispatch for Dynamic System Resources and Generating Units..
10-min Dispatch for Non-Dynamic System Resources AS Energy
Note 1: The HASP functionality is embedded in the RTUC application; the first of the four RTUC runs performs the HASP function.
Note 2: The STUC functionality is embedded in the RTUC application: the second of the four RTUC runs performs the STUC function.

7.3.4Publish Real-Time Market Reports to Scheduling Coordinators

The following is a summary of the Real-Time Market reports available to SCs for online viewing:

HASP & Real-Time MPM Results – Information about the mitigated Bid that is used if the original Bid is modified in the HASP.

HASP hourly Energy Dispatch and AS awards for Non-Dynamic System Resources.

RTUC 15-min Ancillary Services Awards for non-Hourly and Dynamic System Resources and Generating Units.

HASP 15-min advisory Energy Dispatch and Ancillary Services Awards for Dynamic System Resources and Generating Units.

HASP Inter-SC Trades – Inter-SC Trade Schedules for both Trades at Aggregated Pricing Nodes and physical trades, for both Energy and Ancillary Services Obligation, as a result of the HASP.

Refer to the BPM for Market Instruments for the detailed contents of these reports.

7.5Hour-Ahead Scheduling Process

This section is based on CAISO Tariff Section 33, Hour-Ahead Scheduling Process (HASP).

HASP is the hour-ahead scheduling process during Real-Time. The HASP functionality is included in a special hourly run of RTUC. RTUC utilizes an SCUC optimization and runs every 15 minutes, as described in Section 34 of the CAISO Tariff and Section 7.6 of this BPM. This section describes the special features of the specific hourly HASP run of RTUC.

HASP enables the CAISO to issue hourly pre-dispatch instructions to Non-Dynamic System Resources that submit Energy Bids to HASPRTM along with AS Aawards for Non-Dynamic System Rresources that submit Ancillary Services S Bbids. HASP also enables SCs to change their Day-Ahead Schedules, as provided in Section 33.1 of the CAISO Tariff, and submit Bids to export Energy at Scheduling Points.

7.5.4HASP Constraints & Objectives

This section is based on CAISO Tariff Section 33.2, The HASP Optimization.

After the HASP and RTM Market Close for the relevant Trading Hour, the Bids have been validated and the MPM-RRD process has been performed, the HASP optimization determines feasible HASP Advisory Schedules and Ancillary Service awards for Generating Units and Dynamic System Resource for Generating Units for each 15-minute interval of the Trading Hour, as well as hourly HASP Intertie Schedules and AS awards from Non-Dynamic System Resources for that Trading Hour.

HASP, like the other runs of RTUC, utilizes the same SCUC optimization and FNM as IFM, with FNM updated to reflect changes in system conditions as appropriate, to ensure that HASP Intertie Schedules are feasible.

Instead of clearing against Demand Bids as in IFM, HASP clears Supply against the CAISO Forecast of CAISO Demand plus submitted Export Bids. The HASP optimization also factors in forecasted unscheduled flow at the Scheduling Points. Note, self schedules for export Resources will be given the same scheduling priority as internal price taker demand when validated to be supported by non-RA capacity, and will be given a lower price taker priority when supported by RA capacity.

HASP optimization produces Settlement prices for hourly imports and exports to and from the CAISO Balancing Authority Area reflected in the HASP Intertie Schedule and for the HASP AS Awards for System Resources.

Exhibit 7-3 illustrates how the Market Clearing Price for Energy for a HASP time interval is calculated for the case with no Marginal Losses and no Congestion. In this scenario all the LMPs for Energy have the same value, equal to the MCP.

The major difference between this exhibit and the corresponding Exhibit 6-3 for DAM is that RTM has no Demand Bids. Therefore the MCP is established by the Supply curve and the total Real-Time Demand.

Exhibit 73: Real-Time Market Clearing Price for Energy (Ignoring Marginal Losses & Congestion)


7.5.5HASP Outputs

HASP outputs are described in the following subsections.