Alberta Net Settlement Current State

Transcription

1 Alberta Net Settlement Current State July 20, AESO Workgroup

2 Summary Net Settlement Options There are two distinct scenarios from a net settlement perspective Two AESO customers (or a single customer with multiple meter points) express a desire to be treated by the AESO on a net basis AESO provides a tool for this in the form of a net settlement instruction (NSI) Power settled through an NSI is still part of the market and both sites are measured on a gross basis Two parties are connected in such a way that only their net supply/ demand is visible to the AESO at the transmission connection Generally referred to as behind-the-fence (BTF) Various options exist for BTF; a special case is a designated industrial site (ISD) AESO sometimes has visibility into the BTF arrangement but only the net amount is subject to the transmission tariff and to pool revenue/charges The following slides explain in more detail an NSI, a generic BTF, and an ISD as a special BTF arrangement 2

3 Net Settlement Instruction Net Settlement Instructions (NSI) Key element is that participant(s) register an NSI with the AESO that instructs the AESO to net assets against each other for settlement purposes An NSI is considered a physical trade because it notionally ties 2 assets together via the instruction The only implications of this trade are financial there is no implied flow of power from one asset to the other The assets can be anywhere in the province and the presence of the trade only impacts charges associated with energy STS/DTS, distribution, pool trading charges and any other charges based on metered energy are not altered by the NSI The NSI is simply an instruction to the AESO that two assets are to be netted against each other prior to settlement of energy charges the terms of the trade between the parties is not monitored by the AESO beyond the volume of the trade If a 20 MW load had registered an NSI for 20 MW in that same hour, it would be charged for 0 MW of energy If a 40 MW generator sold the 20 MW NSI it would only receive pool price for 20 MW The 20 MW NSI basically adjusts both sides of the trade and the AESO only settles the resulting net for energy costs Any other charges from the AESO are not impacted for either side 3

4 Behind the Fence Behind the Fence Generation Behind the fence generation is generally described as a location where generation and load sit behind the same transmission interconnection point Examples include a generator and load behind the same transmission interconnection point where the two facilities are related (connected by wires and/or part of a common process) Others include a generator and load behind the same transmission interconnection point where the two facilities are not related (not directly connected by wires or process integration) Distribution connected assets can be considered a special case of this arrangement Behind the fence treatment has several variations in line with the above situations Where generation and load are metered on a combined basis All AESO charges are settled on a net basis and the generation and load are effectively removed from the market Requires a direct physical connection or DAT exception between the load and generation An ISD (next slide) is an example of this type but sites that fit this category are not necessarily ISDs Where generation and load are metered and settled separately DTS charges are evaluated on a net basis at that interconnection point Generator charges accrue identically to the situation where the generation was not behind the fence The load is still settled through the pool based on its gross amount 4

5 ISD Industrial System Designation An ISD is a specific type of behind the fence generation situation Defined in legislation Requires that the generation and load facility are integrated and physically connected with privately owned transmission or hold a DAT (Duplication Avoidance Tariff) Cogeneration sites are the typical example of an ISD although not all cogeneration sites have applied for an ISD ISD sites are metered on a net basis load and generation that offset each other behind the fence are not part of the centralized pool Pool trading charges, variable DTS charges, and other AESO costs are not levied against the behind the fence element only the net component AESO does not carry reserves for the behind the fence load (generally it is not part of the Alberta Load Responsibility calculation for the purposes of calculating required reserve volumes) Broadly these volumes form the difference between Alberta Internal Load and AIES load (ignoring Medicine Hat, etc) The generation and load that offset each other behind the ISD fence are not part of the AESO market this is a pure physical self supply model Ownership of the generation and load behind the fence is not a determining factor in the ISD designation integration and physical connection of the facilities is the key 5

6 Self Supply Definition Proposed Self Supply Definition for Capacity Market Self-supply is defined as generation and load not settled through the current energy market due to an arrangement that allows for the production and consumption of energy within the site with only the net component of that supply or demand subject to AESO settlement. This includes energy at sites connected by the transmission network that is settled on a totalized basis due to the presence of a distribution avoidance tariff (DAT). With self-supply, generation and load that would not attract pool and/or realtime transmission charges/credits, can voluntarily elect the same net treatment within the capacity market, removing both the supply and demand from the AESO administered capacity market. 6