California Independent

System Operator

ISO Department of Market Analysis

Analysis of Day Ahead Congestion Costs,
Curtailments, and Unscheduled ETC
Transmission Capacity

By
Keith Casey
ISO Department of Market Analysis
February 8, 2000

ISO Department of Market Analysis 1

 California Independent
System Operator

Impact of Congestion on Day-ahead Energy Costs to the Load

Apr 98-Mar 99 ($ million) Apr 99 - Nov 99 ($ million) Total for
Branch Group Direction NP15 SP15 Total NP15 SP15 Total Both Periods
COI Import 12.87 18.51 31.38 26.98 26.27 53.24 84.62
Path 15 S -> N 24.07 -87.83 -63.76 95.27 -222.39 -127.13 -190.89
Path 15 N -> S -15.73 16.40 0.66 -1.26 1.51 0.26 0.92
Palo Verde Import 1.43 2.26 3.69 2.31 2.25 4.56 8.25
Eldorado Import 2.35 3.64 6.00 4.02 3.83 7.85 13.85
NOB Import 3.51 5.32 8.83 8.05 12.66 20.71 29.54
Total 28.50 -41.71 -13.21 135.37 -175.87 -40.50 -53.71
Methodology:

1. The difference between the constrained and unconstrained cost of energy for congestion zones “NP15” and “SP15” is calculated for each hour using the
following formula:

Congestion Costs = (PX Day-ahead Zonal (constrained) Price – PX Day-ahead Unconstrained)*PX DA scheduled zonal load

2. For each hour a Total Curtailment is calculated. This number is equal to the sum of the curtailments of each of the five paths listed in the above table. A
path is deemed curtailed if; 1) there is a positive congestion price and 2) its final NFU schedule is less than its initial NFU schedule. This is a subtle point
but there are cases where a path has a positive congestion price and the final NFU schedules are greater than the initial NFU schedules. This happens when
flows on a path are increased to relieve congestion on other paths in the system.

3. Using COI as an example, during hours when COI is congested, a Congestion Ratio is calculated where:

COI Curtailment
Congestion Ratio =
Total Curtailment
4. Continuing with the COI example, the portion of Congestion Costs for each zone (NP15, SP15) that is attributed to COI is calculated by multiplying the
Congestion Ratio by the Congestion Costs. If COI is the only path curtailed in a particular hour than 100% of the congestion costs are attributed to COI.
However, if several of the five paths were curtailed in a given hour and COI’s curtailment constituted only 20% of the total curtailments than only 20% of
the congestion costs would be attributed to COI.

ISO Department of Market Analysis 2

 California Independent
System Operator

Market Results: No Congestion on Path 15

SP15 NP15 SP15+NP15
SNP15 DemandNP15+SP15
DemandSP15 DemandNP15
SSP15
SupplyNP15+SP15
PU

Gen.
Export to
Gen. Cost Cost
NP15
QSP15 QNP15 QTOTAL

Market Results: Congestion (Path 15 Rating = 0)

SP15 NP15
DemandSP15 SNP15
SSP15 DemandNP15 = Cost Savings to SP15 Load
PNP15
PU
PSP15
= Cost Increase to NP15 Load
Gen.
Gen. Cost Cost

QSP15 QNP15

ISO Department of Market Analysis 3

 California Independent
System Operator

Day-ahead Import Curtailments of COI (Apr 98 - Mar 99)

Day-ahead Import Curtailments on COI with and without
Unscheduled ETC Capacity
160
Total actual day ahead curtailments
140
120 Total day ahead curtailments if unscheduled ETC capacity
GWhs Curtailed

was available to the congestion market.

100
80 For COI, most all of the day-ahead
curtailments could have been avoided had
60 unscheduled ETC been available for NFU.
40
20
0
8 98 8 8 8 8 8 8 9 9 9
-9 98 n- -9 -9 -9 -9 -9 -9 -9 -9 -9
pr y- u l
ug p ct v ec n b ar
A M
a Ju J A Se O N
o D J a Fe M

ISO Department of Market Analysis 4

 California Independent
System Operator

Day-ahead Import Curtailments of COI (Apr 99 - Nov 99)

Day-ahead Import Curtailments on COI with and without

Unscheduled ETC Capacity
180,000
160,000 Total actual day ahead curtailments
140,000 Total day ahead curtailments if unscheduled ETC capacity
120,000 was available to the congestion market.
100,000
MWh

80,000
60,000
40,000
20,000
0

ISO Department of Market Analysis 5

 California Independent
System Operator

Day-ahead South to North Curtailments of Path 15

(Dec 98 - Nov 99)

Day-ahead South to North Curtailments on Path 15

with and without Unscheduled ETC Capacity
600,000

500,000 Total actual day ahead curtailments

400,000 Total day ahead curtailments if unscheduled ETC capacity

was available to the congestion market.
MWh

300,000

200,000

100,000

ISO Department of Market Analysis 6

 California Independent
System Operator

Day-ahead North to South Curtailments of Path 15

(Dec 98 - Nov 99)

Day-ahead North to South Curtailments on Path 15

with and without Unscheduled ETC Capacity

4,500
4,000
Total actual day ahead curtailments
3,500
3,000
Total day ahead curtailments if
2,500
MWh

unscheduled ETC capacity was

2,000 available to the congestion market.

1,500
1,000
500
0

99
99

9
99
99

99

9
9
8

99

99
9
-9

-9
-9
-9

l- 9

v-
b-

r-
n-

p-
n-

g-
ay
ar

ct
c

Ju

No
Ap
Fe
Ja
De

Ju

Se
Au

O
M

ISO Department of Market Analysis 7

 California Independent
System Operator

Day-ahead Import Curtailments of NOB

(Feb 99 - Nov 99)
Day-ahead Import Curtailments on Palo-Verde with and without
Unscheduled ETC Capacity
50,000
Total actual day ahead curtailments
45,000
40,000
35,000 Total day ahead curtailments if unscheduled
ETC capacity was available to the congestion
30,000 market.
MWh

25,000
20,000
15,000
10,000
5,000
0

ISO Department of Market Analysis 8

 California Independent
System Operator

Day-ahead Import Curtailments of Palo Verde

(Feb 99 - Nov 99)

Day-ahead Import Curtailments on Palo-Verde with and without

Unscheduled ETC Capacity
40,000
35,000
Total actual day ahead curtailments

30,000 Total day ahead curtailments if unscheduled ETC capacity

25,000 was available to the congestion market.
MWh

20,000
15,000
10,000
5,000
0

ISO Department of Market Analysis 9

 California Independent
System Operator

Day-ahead Import Curtailments of Eldorado

(Feb 99 - Nov 99)
Day-ahead Import Curtailments on Eldorado with and without
Unscheduled ETC Capacity
70,000
Total actual day ahead curtailments
60,000
Total day ahead curtailments if unscheduled ETC capacity was
50,000 available to the congestion market.

40,000
MWh

30,000

20,000

10,000

ISO Department of Market Analysis 10

 California Independent
System Operator

Methodology for Calculating Curtailments

For hours having day ahead congestion on COI:
– Actual Curtailments = Initial New Firm Use (NFU) Schedule - Final NFU
Schedule
– Unscheduled ETC Capacity = Hour ahead TTC - Total Real-Time
Schedules*
– Estimated curtailments if unscheduled ETC was available to the day
ahead market = Max (0, Actual Curtailments - unscheduled ETC capacity)

* Real-time Schedules refers to final tie-point schedules at the end of the

ETC scheduling deadline of 20 minutes prior to the operating hour.

ISO Department of Market Analysis 11

 California Independent
System Operator

Potential Annual Cost Savings to Load from Making ETC

Capacity Available to the Day Ahead Market
(Dec 98 - Nov 99)
Congestion Costs to Load from Estimated Potential Cost Savings had
PATH Day-ahead Congestion ($) Unscheduled ETC been available ($)
NP15 SP15 TOTAL NP15 SP15 TOTAL
COI 32,653,341 34,259,177 66,912,517 32,193,160 33,794,963 65,988,123
PATH 15 S->N 103,594,640 -249,819,543 -146,224,903 33,292,976 -91,570,071 -58,277,095
PATH 15 N->S -1,355,824 2,428,474 1,072,651 -1,132,487 1,926,588 794,102
NOB 9,974,280 15,762,222 25,736,502 4,446,611 6,983,620 11,430,231
PALO VERDE 2,557,521 2,642,468 5,199,990 1,516,006 1,559,129 3,075,135
ELDORADO 5,848,429 6,752,020 12,600,449 408,316 563,425 971,741
TOTALS 153,272,387 -187,975,182 -34,702,795 70,724,583 -46,742,345 23,982,237

ISO Department of Market Analysis 12