Federal regulators on Friday rejected requests by Entergy and other load-serving entities for waivers from the Midcontinent Independent System Operator’s new seasonal capacity rules, saying approving the waivers would have hurt generators across the grid operator’s footprint.
The decisions affect Entergy Arkansas, Entergy Mississippi, Arkansas Electric Cooperative Corp., East Texas Electric Cooperative. They also affect Conway Corp., City Water and Light Plant of the City of Jonesboro, and West Memphis Utilities — three municipal utilities in Arkansas.
The issue centers on MISO’s seasonal resource adequacy framework, which includes “availability-based” capacity accreditation. FERC approved the seasonal framework a year ago.
The framework, designed to improve grid reliability, bases a non-intermittent power plant’s accredited capacity on its performance over the previous three years during “resource adequacy” hours and non-RA hours. MISO uses a formula to blend the RA and non-RA hours to determine how much capacity should be accredited to a power plant. MISO assigns zero capacity value for an RA hour if a generator that takes 24 hours to start was offline.
Entergy and the other LSEs sought waivers from the provision giving zero capacity credit for power plants that take 24 hours to start. In part, they said that due to the provision they may need to buy additional capacity to meet their planning reserve margin requirements, driving up costs.
Entergy’s waiver request was supported by utility commissions from Arkansas, Louisiana and Mississippi as well as a coalition of MISO transmission customers. In Entergy’s case, the utility commissions said MISO’s process creates an artificial capacity deficiency that could cost ratepayers tens of millions of dollars a year.
The Natural Resources Defense Council, Public Citizen, Southern Renewable Energy Association and Sustainable FERC Project jointly opposed Entergy’s waiver request. Granting the request would undermine MISO’s seasonal capacity framework, they said.
In its decisions, FERC said granting the waiver requests would harm demand response resources and other non-intermittent generators by leading to a reduction in their final seasonal capacity accreditation values.
