ERCOT NEWS: September Board Meeting Highlights
- Board Approves Budget without Fee Increase
- Nodal Program Eyes Next Milestone; Financial Reporting on Track
- Advanced Meters, Other Staff Reports Presented
- Executive Changes Announced
The Board of Directors for the Electric Reliability Council of Texas, grid operator and manager of the electric market for most of the state, approved a 2010 budget of $176.8 million without a fee increase at Tuesday’s monthly meeting.
Major changes made since the preliminary budget proposal from last month included further reductions in employee costs, outside services, and the Legislative Sunset Review costs, and a decision to fund some extraordinary facility construction costs with extra revenue received from a sales tax refund, related to the recent change to 501(c)4 status, from a 501c(6).
The system administration fee, which represents 96 percent of the 2010 base operating revenue requirement, is paid by wholesale users of the power grid. If the current fee $0.4171 per megawatt hour were passed directly through to end-use customers, it would average about 42 cents per month or $5 per year, based on 1,000 kilowatt-hour usage per month.
In other action, the board approved:
- The 2010 commercially significant constraints and congestion management zones as recommended by the Technical Advisory Committee; the board is required by the ERCOT market rules to reassess the congestion zone designations annually.
- 2008 401(k) Audit Report
- Board Meeting Schedule for 2010
- Eleven Protocol Revision Requests (PRR), nodal PRRs (NPRRs), and Nodal Operating Guide Revision Request:
PRR 812 – Wind Generator Forecast Scheduling
PRR 818 – Out-of-Merit Capacity (OOMC) for Quick-Start Units
NPRR 183 – Synchronization of PRR790, Load Profile ID Annual Validation Change Request
NPRR 185 – Cancellations of Reliability Unit Commitment (RUC) Committed Resources
NPRR 186 – Naming Convention Clarification
NPRR 188 – MVA for Security Constrained Economic Dispatch (SCED) Input
NPRR 192 – QSE Energy and Ancillary Service Compliance Criteria
NPRR 165 – Synchronizing Section 1 with PRR697
NPRR 168 – Change the Definition of "Start-up" and Include the Fuel from Breaker Close to Low Sustainable Limit (LSL) in Start-up Costs
NPRR 184 – Section 2, Addition of Definitions and Acronyms from Zonal Protocols and Clarifications
NOGRR 025 – Monitoring Programs for QSEs, TSPs, and ERCOT
Nodal Program Eyes Next Milestone; Financial Reporting on Track
ERCOT Chief Technology Officer Mike Cleary updated the board on the nodal single-entry model’s (SEM) successful implementation and the next major milestone facing the nodal program: market connectivity on Oct. 28.
“The system is stable and working well, and we did get it in on time,” Cleary said. He thanked the technology provider for SEM who “went above and beyond to get this application where it needed to be to go live.”
As of Sept. 10, transmission service providers had submitted 203 change requests since the Aug. 31 go-live date without any significant functional issues.
SEM is an electric-transmission management system which enables utilities to interactively view and update the ERCOT transmission model concerning their changes to the grid such as new transmission lines, substations, and other equipment.
Cleary said the nodal program is now devoting its energy to the Oct. 28 market connectivity milestone. ERCOT market participants will be given access to the nodal market trials environment and the latest version of several software applications, enabling them to complete their own development activities.
Full market trials are scheduled to begin in the first quarter of 2010. The nodal market remains on track for its December 2010 implementation.
Chief Financial Officer Steve Byone reported the nodal program registered a $1.1 million under-run in August and remains on track to provide re-forecasted estimates to complete the program at the October board meeting. Byone said a full discussion will also be held at that time on the program’s cumulative under-run, which has grown to $20.5 million.
Advanced Meters, Other Staff Reports Presented
Special presentations during the board meeting included:
Additional staff presentations included:
- Grid Operations and Planning Report
- Market Operations Report
- Financial Summary Report
- Information Technology Service Availability Metrics Report
Executive Changes Announced
President and CEO Bob Kahn announced his decision to leave in November at the end of the board of directors meeting. See news release.
Also, Vice President and CFO Steve Byone is leaving this month to assume the position of vice president and controller for the Tennessee Valley Authority, Kahn announced to the board. ERCOT is currently interviewing individuals to serve as interim chief financial officer while a search for Steve’s permanent successor is underway.
Board Chair Jan Newton and Finance and Audit Committee Chair Clifton Karnei both noted that Byone came on board during a very difficult time when ERCOT was under intense scrutiny, and through his efforts, reestablished confidence in financial controls at the organization.
All board meeting documents are available at this link.
ERCOT is a membership-based 501(c)(4) nonprofit corporation, governed by a board of directors and subject to oversight by the Public Utility Commission of Texas and the Texas Legislature. Its members include consumers, cooperatives, generators, power marketers, retail electric providers, investor-owned electric utilities, transmission and distribution providers and municipally owned electric utilities.