Issue 37 - System Operator Newsletter

Our most recent System Operator newsletters were devoted to providing updates of progress in relation to implementation of the new dispatch and market systems. We are now reverting to our regular two monthly newsletters which will advise industry of the key issues /projects the System Operator is involved with, any recent or impending IT releases and any other issues that we believe may be of interest.
If you have any feedback on our newsletters or have suggestions in respect of content of future newsletters, please feel free to contact us.

System Operator Management

There have been a number of management changes in the System Operator during the recent months as well as the confirmation of a number of roles.  These are:

• Kieran Devine has been seconded to the role of General Manager, Transpower’s Grid Performance Division.
• Doug Goodwin is Acting General Manager System Operations during Kieran's secondment.
• Conrad Edwards is Acting Development Manager: 021 320 219.
• Kevin Small has been confirmed in the role of Investigations and Planning Manager: 021 312 796.
• Dan Twigg has been confirmed in the role of System Operations Manager: 021 380 123.
• John Campbell has been confirmed in the role of Risk and Performance Manager: 021 390 428.

Market Systems Update

It has now been eight months since the new market systems went live. Overall the systems have performed well and prepared the dispatch and other schedules above targeted performance levels.

Notwithstanding better than expected performance in some areas, there have been some system requirements and issues that have required use of the Stand Alone Dispatch tool (SAD).  SAD is intended for use when we have system problems that prevent normal schedule creation and dispatch operation.  We have suffered a few instances of such problems that have resulted in use of the SAD tool.  In addition, SAD is also used while the market systems are undergoing planned maintenance, such as for installing upgrades.  When SAD is being used, dispatch schedules are produced and published, but other schedules are not.  The number of times SAD has been required is more than we would like, though this is not unexpected given the complexity of the new system and its relative newness into operation.  We continue to seek a reduction in the number of times SAD is required.

In respect of market system upgrades, we had a settling down period between July 2009 and December 2009 when some teething issues were identified and fixed. From December 2009 we started a programme of work to enhance the system to benefit the industry. The key initiatives implemented to date are:

• The reimplementation of the automated frequency keeping selection methodology, also including the constrained on cost calculation in the selection of the keeper. This change reinstated the selection methodology used prior to MSP go-live.
• The reimplementation of variable reserves solution - this change reinstated the functionality used prior to MSP go-live for reducing the reserve requirements in steps (rather than to zero) when a shortage of energy and reserve offers exist.
• Incidental changes to assist participants such as sending special I.D to NZX with all information related to the Special Winter Schedule (SWS) to enable participants to easily identify information regarding the SWS and ensuring that when a dispatch instruction is resent, only that particular dispatch instruction will be sent rather than all dispatch instructions relating to the party.

The next upgrade will be focussed on the winter initiatives which are discussed below.  Following a request from the Electricity Commission, we are presently defining the system changes required for proposed interim pricing initiatives.

Winter Initiatives

The purpose of the winter initiative changes is to alleviate concerns about whether there will be adequate offered generation capacity to meet peak energy demand.

The rule change gazetted on 18 March requires a change to the SPD model to change the way in which instantaneous reserves are dispatched.  The system changes required for this work are quite extensive and, whilst a number of these changes will be delivered by the 1 May deadline (when the rule comes into force), we will be unable to complete the CVP changes by 1 May due to time constraints.  Accordingly, the System Operator will apply to the Electricity Commission for an exemption.  Completion is scheduled for 1 July.  Other changes to facilitate commissioning of Contact Energy’s new Stratford gas turbine plant will be introduced at the same time.

Separately, there is additional work being undertaken to implement improvements suggested by the Short Term Security Forum. These will see additional reserve and quantity data being made available. Phase 1 of the information improvements is scheduled for implementation in mid April and will see:

• changes to reduce the number of SRC notices being sent
• the addition of aggregate cleared wind for the SWS and SDPQ
• the addition of aggregate quantities (offers) for the SDPQ
  We believe NZX will be in contact with participants in the near future in relation to the provision of this data.

Phase 2 of the information improvements is scheduled for introduction on 1 July and includes the addition of:

• aggregate quantities (load) for the WDS and SDPQ
• aggregate quantities (offers) for the WDS
• aggregate reserves quantities for the SWS
• reserve prices for the WDS.

Implementation of IPP and DSBF initiatives

The System Operator is discussing with the Electricity Commission the timing for introducing two forthcoming initiatives, both of which require changes to the market systems, and will proceed following the Winter Initiaive.  These are:

• Interim pricing period (IPP) as next priority
• Demand-side Bidding and Forecasting (DSBF), after IPP.

The System Operator is keen to progress both of these initiatives and as noted above is discussing the scheduling of that work with the Electricity Commission. 

AUFLS Review Update

The System Operator is currently undertaking a back-to-basics review of Automatic Under-Frequency Load Shedding (AUFLS) systems. The review is making good progress, with the first report due out by the end of April. The report will detail findings from the technical studies and survey work, and will cover the following areas:

• The history and purpose of AUFLS
• A summary of the existing operational, market and policy issues with AUFLS
• A comparison of international reserve requirements and AUFLS settings
• Literature review – main findings from international under frequency events and the use of AUFLS
• Results from the technical studies including the performance of the existing AUFLS scheme
• Options and next steps.

In the meantime, we are still seeking comments from interested parties before commencing work on the economic and policy section of the review. More information on the AUFLS review can be found on our website. Comments or enquiries can be sent to system.operator@transpower.co.nz or directly to Natalie Bartos.

Special Winter Schedule

The Special Winter Schedule (SWS) is run and published every two hours on the even hour. We have also been running an extra SWS daily at 13:00.

As of Thursday 8 April 2010 we will cease to run and publish the 13:00 SWS. All other SWS schedules will continue to be published on the even hour. We will send out a CAN closer to the time to confirm the date of the final 13:00 SWS.
 

Dispensation Database

We are pleased to advise that our new dispensation database is due to be implemented on 1 April 2010.  The new dispensation database is web-accessible  and will allow participants to submit dispensation applications and view the status of any existing dispensations on line.   The link to the database will be placed on the dispensations page on the website and participants will be advised of the access requirements in the upcoming weeks.

Policy Statement/ Procurement Plan Review 2010

We have recently completed the 2010 review of the policy statement and have submitted a draft policy statement to the Electricity Commission. The main changes proposed as part of this year’s review were those resulting from the 2009 review of credible event management policies 

Thank you to those who made the time to submit on this policy statement – we made a number of changes to our draft in response to these submissions. 

A copy of the draft policy statement and our response to submissions will be found on the Policy Statement page of our website from Friday 9 April.  The Electricity Commission will be consulting on the draft in the upcoming weeks.

We have brought forward our review of the procurement plan this year.  This will ensure it is considered by the Electricity Commission prior to the transition to the Electricity Authority on 1 October.  We will send out a draft procurement plan for consultation in early April this will be available on our consultantation page of our website.  We look forward to receiving your submissions. 

Simultaneous Feasability Test (SFT) Update

 We have developed a new page on the System Operator’s website to keep you informed about the SFT Implementation project. The page is located under the “Market” on the navigation tab of our website.

If you wish to be kept informed on the progress of this project please subscribe to the page by subscribing to the “Market” section.  When we publish new information under the Market area you will receive an email notification.

Multiple Frequency Keepers Project –Strawman Proposal

The Electricity Commission requested the System Operator to investigate the technical feasibility, cost and timeframe to implement Automatic Generator Control (AGC) in New Zealand.  The overall aim of the EC is to increase competition, and lower costs, in provision of frequency keeping (FK) services through the use of AGC and provision of a National FK market.

Transpower submitted its report to the Electricity Commission on 31 March.  The report covers:

• A note on precursors to any introduction of AGC;
• Commentary on where the strawman FK market design proposed by the Electricity Commission may need adaptation;
• A strawman approach for implementing AGC including details of the proposed interface to generators and the HVDC; and
• Suggested next steps to progress this work.