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Stakeholder Comment and AESO Replies Matrix Proposed New Section ISO Rules Part 300 System Reliability and Operations, Division 304 Routine Operations, Section 304.5, Provision for Operation of a Transmission Facility within Ratings (“New Section 304.5”) Date of Request for Comment: Period of Consultation: September 24, 2015 September 24, 2015 through October 13, 2015 1. ISO Rules Stakeholder Comments and/or Alternate Proposal AESO Replies a) New AltaLink Management Ltd. (“AltaLink”) 1. Agree, however we do have comments on the associated definitions. 1. The AESO acknowledges AltaLink’s agreement with New Section 304.5. The AESO is seeking comments from stakeholders with regard to the following matters: 1. Do you agree or disagree with the proposed New Section 304.5? If you disagree, please provide comments. 2. Are there any subsections where the language does not clearly articulate the requirement for either the AESO or a market participant? If yes, please indicate the subsections and suggest language that would improve the clarity. AESO Replies to Stakeholder Comments: March 3, 2016 TransAlta Corporation (“TransAlta”) 2. TransAlta is not opposed to the transition of TFO Terms and Conditions to ISO rules, but TransAlta is concerned that applying these ISO rules to all legal owners of transmission facilities results in new compliance obligations for some organizations. Radial transmission facilities are sometimes owned by orgranizations other than the regulated TFOs because a radial facility was constructed and operated as part of a generating unit’s connection to the system or as part of an industrial system. It appears that the intent of this rule is to transition obligations that exist for regulated TFOs into the ISO rules, but the application of this proposed rule to all legal owners of transmission facilities captures a number of additional organizations that own unregulated radial transmission facilities. The application of this proposed rule to radial facilities does not create any benefit to the system. Consider a radial transmission facility serving a generating unit. Such a facility is usually designed to accommodate the full output of the generating unit, and therefore cannot violate section 2 of the proposed rule. This radial transmission facility cannot be used to accommodate power flow following a contingency elsewhere in the 2. The AESO disagrees with TransAlta that it is not possible for the legal owner or operator of a radial transmission facility to contravene New Section 304.5. For example, where the thermal limit of a radial transmission facility connecting a generating unit is derated, the derated thermal limit of the radial transmission facility effectively becomes its normal rating. In such cases, the normal rating for the radial transmission facility may be less than the planned output of the generating unit, such that the radial transmission facility will not be able to operate within normal ratings under pre-contingency conditions, in accordance with subsection 2 of New Section 304.5. A legal owner or operator of a radial transmission facility may also contravene New Section 304.5 where a radial transmission facility connecting a generating unit experiences operating conditions such that the normal or emergency voltage limits of the radial transmission facility are exceeded. In such circumstances, the voltage at the point of interconnection of the radial transmission facility may impact the operating voltages of the Alberta Page 1 of 2 system, and therefore cannot violate either sections 3 or 4 of the proposed rule. It is not possible for a radial facility to violate any part the proposed rule, yet the rule would apply to the legal owner of such a facility and create a regulatory burden for that legal owner. TransAlta submits that the proposed rule should not apply to radial transmission facilities. The AESO could use similar language to that in EOP-001-AB-2b and EOP-003-AB1-1 which do not apply to “the operator of a transmission facility whose transmission facility is a radial connection from a generating unit or an aggregated generating facility”. interconnected electric system (“AIES”). Where the normal or emergency voltage limits are exceeded, the radial transmission facility will not be able to operate within normal ratings or emergency ratings, respectively, in accordance with subsection 2 and 3 of New Section 304.5. In both of the examples described above, the AESO and the operator of the radial transmission facility may have to coordinate actions, in accordance with subsection 4 of New Section 304.5, to resolve the condition. For example, in a post-contingency condition, the voltage at the point of interconnection of the radial transmission facility may decrease below an acceptable value and may affect voltages further into the AIES. Post-contingency actions may involve the AESO directing the operator of a radial transmission facility to increase the reactive power output of its on-site generator or decrease on-site load to restore voltage to within the normal values. Requiring the legal owners and operators of radial transmission facilities to comply with New Section 304.5 will support the AESO’s reliable operation of the AIES, as the legal owners and operators of radial transmission facilities will be required to operate their facilities within normal ratings and emergency ratings under pre-contingency conditions, and the actions for returning the loading of the radial transmission facilities to, or within, their normal ratings will be a coordinated effort between the operators of the radial transmission facilities and the AESO. AESO Replies to Stakeholder Comments: March 3, 2016 Page 2 of 2