INTRODUCTION

The release of the Ontario Long Term Energy Plan (LTEP) and commitments to renewable energy under the Ontario Power Authority (OPA) Feed-In Tariff Program (FIT), drive significant change in the day-to-day operation of the Ontario electricity grid and the administration of the energy market. The Independent Electricity System Operator (IESO) has acknowledged that changes are required to incorporate renewable resources into its system and market operations. To facilitate a new stakeholder plan, an initiative known as Renewable Integration (SE-91), was developed in November 2010. SE-91 was established to provide a forum to discuss design principles for forecasting, dispatch, visibility and future markets of wind and solar generation.

To date, the IESO has developed a final set of design principles to provide the foundation for integrating renewable resources into IESO operations and has released a paper entitled Integrating Renewable Resources - Design Principles (Design Principles). The IESO received feedback from stakeholders in early 2011 and has indicated that it would like to be in a position to register and incorporate renewable generation into its operations in the next two years.

SUMMARY OF PRELIMINARY DESIGN PRINCIPLES

The Design Principles consist of eleven principles divided between three areas, namely, forecasting, visibility and dispatch of renewable generation.

The Design Principles are listed by the IESO as follows:

Forecasting

  1. Implementation of centralized forecast for all wind and solar resources with an installed capacity of 5MW or greater and all wind and solar resources directly connected to the IESO Controlled Grid.  
  2. Real-time forecast data will be used for variable generation dispatch and actual real-time data will be used for calculating foregone energy to support OPA contract settlement.  
  3. The costs paid to the centralized forecast service providers will be treated as procured service charges and will be recovered from consumers through existing procurement market recovery mechanisms.  

Visibility

  1. All variable resources subject to centralized forecasting will provide static plant information and data.  
  2. All variable resources subject to centralized forecasting will provide dynamic data (real-time telemetry).  
  3. All forecasts of facility output for resources subject to centralized forecasting will be publicly available.  

Dispatch

  1. All variable resources connected to the IESO-Controlled Grid, and embedded variable resources tha t are registered market participants, will be actively dispatched on a five-minute economic basis.  
  2. Variable generators should operate within a compliance deadband when ambient conditions offer sufficient fuel.  
  3. Variable generators will be entitled to Congestion Management Settlement Credits payments.  
  4. IESO may establish floor prices for offers from baseload generators (i.e. wind, must-run hydro and nuclear) to ensure efficient dispatches during periods of local and/or global surplus baseload generation (SBG) events.  
  5. Directly connected variable resources (and embedded resources that are market participants) will be eligible to participate in Operating Reserve and ancillary markets where technically feasible (such integration will be considered on a cost benefit basis, and is not likely to be addressed in the near term).

STAKEHOLDER FEEDBACK

IESO received feedback on the preliminary Design Principles from over a dozen stakeholders. Stakeholder comments have been summarized and are available for review on the IESO website at http://www.ieso.ca/imoweb/consult/consult_se91.asp. The IESO divided stakeholder feedback between comments related to Design Principles, and others related to design details. The final Design Principles reflect stakeholder consultation and are proposed to be used as the basis for developing Market Rules and completing detailed design work. Overarching themes from stakeholder feedback included concerns in relation to cost/benefit considerations, timeline for implementation, alignment with OPA FIT contracts and other renewable generation contracts, and grandfathering rights.

NEXT STEPS

SE-91 consultation is currently continuing through the Visibility Technical Working Group, one of several proposed working groups. The focus of the Visibility Technical Working Group is to determine and define data requirements from wind and solar generators for centralized forecasting service purposes. This group will also focus on defining the design details required to ensure that the IESO can monitor production of embedded wind and solar resources. The Visibility Technical Working Group’s next meeting is scheduled for March 30, 2011.