Dispatchable Wind Resources in the Midwest

By Jeffrey M. Gray, PhD, Esq.

The deadline is fast approaching for most wind farms that operate within the Midwest Independent Transmission System Operator, Inc. (“MISO”) to register with MISO as Dispatchable Intermittent Resources (“DIRs”). Those wind farms must register by December 15, 2012, and meet DIR operational and technical requirements by March 1, 2013, or risk non-compliance.

On November 1, 2010, MISO filed proposed tariff changes with the Federal Energy Regulatory Commission (“FERC”) that would place intermittent resources on similar footing with other generation resources in the real-time energy market, by making intermittent resources dispatchable. See section 40.3.4.d.ii of the MISO tariff. MISO proposed two exemptions to the DIR registration requirement: (1) intermittent resources that commenced commercial operation before April 1, 2005, and (2) intermittent resources that have all of their capacity covered by long-term firm point-to-point transmission service, network integrated transmission service, or network resource interconnection service. The first exemption recognizes that older projects are unlikely to be able to meet the operational and technical requirements for automatic dispatch in a cost-effective way. The second exemption acknowledges a category of projects that have already been determined to be able to reach any load, and therefore do not need to be capable of following automated dispatch instructions.

On February 28, 2011 the FERC accepted MISO’s proposal with respect to wind resources, but not for non-wind intermittent resources. The FERC also accepted the two exemptions. Further, the FERC declared that once a wind resource registers as DIR, it cannot revert back to a non-dispatchable intermittent resource if it later meets the criteria for exemption.

Conventional resources in MISO’s real-time energy market provide forecasts of available generation every hour and half hour in advance of the relevant operating hour. In contrast, DIRs will provide a forecast maximum limit, plus a rolling forecast of twelve five-minute intervals prior to the operating hour. To achieve DIR operational and technical requirements, wind farm operators have been upgrading their Inter-Control Center Communications Protocol (“ICCP”) capabilities, to expand real-time data exchange with MISO and to be able to respond to automatic dispatch signals. By making wind resources dispatchable in real time, MISO will achieve better congestion management (i.e., fewer manual curtailments), more accurate pricing (DIRs can set price), and better system regulation and control.

Approximately 17% of existing wind resources in MISO qualify for exemption from DIR registration, and can remain non-dispatchable. The other 83% must register as DIRs by December 15, 2012 for the March 1, 2013 Commercial Model, and meet DIR operational and technical requirements by March 1, 2013, or risk non-compliance. At the time of this writing, approximately 30-35% of non-exempt wind resources remain unregistered.

Non-exempt wind farms unable to meet the December 15, 2012 registration deadline to comply with the March 1, 2013 DIR requirements may file a waiver request with the FERC. If a non-exempt wind farm fails to register or file a waiver request by the December 15 deadline, MISO will inform the wind farm that it will be out of compliance on March 1, 2013. After March 1, 2013, MISO will report any non-compliant wind farm to the independent market monitor (“IMM”), and may refer the non-compliant wind farm to the FERC. Further, under sections 7.16.1(d) and 7.17(a) of the MISO tariff, MISO can find the non-compliant wind farm in default, suspend services, and initiate FERC proceedings to terminate services and agreements.

 
Jeffrey M. Gray, PhD is an energy lawyer and economist, and is admitted to the Michigan, Wisconsin, New York, and District of Columbia Bars.  Jeff focuses his practice on energy markets, energy infrastructure, commercial transactions, public policy, and state and federal regulation.  He provides sophisticated legal services to clients including renewable energy developers, electric and natural gas utilities, commodities firms, and electric transmission companies.  Additional information about his practice is available at www.graypllc.net.