Understanding MISO's LMR Accreditation Reforms: Why, What, and When
Changes to Load Modifying Resources on the horizon at MISO.
As our energy landscape evolves, so too must the systems and policies that underpin it. The Midcontinent Independent System Operator (MISO) is at the forefront of this transformation, working diligently to ensure that our grid remains reliable, efficient, and capable of integrating an increasing share of renewable energy. One significant initiative currently underway is the reform of Load Modifying Resource (LMR) accreditation. This blog explores why MISO is changing LMR accreditation, what these changes entail, and when they will be implemented.
MISO’s May 22, 2024, presentation is posted here.
MISO received 31 comments from stakeholders at the April Resource Adequacy Sub Committee (RASC). So, MISO will be coming back to the July RASC meeting with an updated proposal.
Source - MISO Market Monitor (the 2023 report is expected to be available in June)
Why MISO is Changing LMR Accreditation
The need for reform in LMR accreditation stems from several critical factors:
Increased Operational Uncertainty: With the rising penetration of intermittent renewable resources, changing weather patterns, and growing electrification, the grid is experiencing higher levels of uncertainty and complexity. LMRs, which were designed to provide demand response during peak conditions, must now adapt to these new challenges to maintain reliability.
Historical Performance Issues: Historically, MISO has observed that the real-time availability of LMRs has been substantially lower than the capacity cleared in the Planning Resource Auction (PRA). This discrepancy raises concerns about the reliability of LMRs during emergency conditions when they are most needed.
Enhanced Reliability Needs: To ensure reliable grid operations, MISO operators require LMRs to respond quickly and effectively. The current notification times and performance standards are not sufficient to meet the increasing demands of the system, necessitating a comprehensive overhaul of the LMR product.
Alignment with Resource Adequacy Goals: MISO’s broader Resource Adequacy initiatives aim to improve pricing, accreditation, and operational efficiency. The LMR reforms are part of this strategic effort to ensure that all supply and demand resources contribute to grid reliability in a manner that reflects their true operational capabilities.
Source - MISO 2024 Summer Assessment.
What MISO is Changing
MISO's proposed changes to LMR accreditation focus on several key areas:
Redefining LMR Product: The reform will redefine the LMR product to enhance its reliability and efficiency. This includes updating participation requirements and providing alternative avenues for current LMRs to participate in the market, thus improving their operational availability during critical periods.
Performance-Based Accreditation: MISO plans to implement performance-based accreditation for LMRs. This approach will ensure that resources are accredited based on their actual performance and ability to respond during emergencies rather than on theoretical or historical data alone.
Notification Time and Testing Requirements: One of the significant changes involves shortening the notification time required for LMRs to respond to grid emergencies. Additionally, increased testing requirements will be introduced to verify that LMRs can meet these stringent response times reliably.
Standardized Registration and Audit Processes: To improve data consistency and reliability, MISO will standardize the registration forms for all demand response resources. This standardization will facilitate better information exchange, enhance the accuracy of availability data, and provide a solid basis for auditing resource performance.
Alignment with Other Demand Response Products: The reforms will also evaluate necessary changes to the Demand Response Resource (DRR) product to ensure alignment with other demand response mechanisms, such as Emergency Demand Response (EDR). This alignment is crucial for creating a cohesive and efficient market structure.
Deploying LMRs can prevent blackouts. See Event Step 2 below before Step 5 - load shed, i.e., blackout.
Source - MISO Winter Storm Elliott presentation
When MISO Proposes to Implement These Changes
The timeline for implementing the LMR accreditation reforms is as follows:
Stakeholder Feedback and Revisions: MISO has already begun engaging stakeholders and gathering feedback on the proposed changes. Formal feedback from 40 stakeholders has been received, and MISO is currently analyzing this input to refine its proposal.
Revised Proposal Presentation: A revised proposal, incorporating stakeholder feedback, will be presented at the July RASC meeting. This step is crucial for ensuring that the final reforms are well-informed and broadly supported.
Tariff Language Drafting: Following the presentation and further stakeholder discussions, MISO will begin drafting the necessary Tariff language to codify the new LMR accreditation requirements. This process will also involve seeking additional stakeholder feedback to ensure that the proposed changes are clearly articulated and actionable.
FERC Filing: MISO plans to file the revised Tariff with the Federal Energy Regulatory Commission (FERC) in Q3 2024. This filing will allow MISO to send appropriate signals to market participants and regulators, providing them with the necessary time to make adjustments and prepare for the new requirements.
Effective Date: The new LMR accreditation requirements are proposed to take effect for the Planning Year (PY) 2028-2029. This timeline provides a reasonable window for all stakeholders to adapt to the changes and for MISO to ensure a smooth transition to the new accreditation framework.
During Winter Storm Elliott, MISO deployed LMRs and supported its neighbors -
Source - MISO
Conclusion
MISO's reforms to the LMR accreditation process represent a significant step towards enhancing grid reliability and efficiency in an increasingly complex and uncertain energy environment. By redefining the LMR product, implementing performance-based accreditation, and aligning market requirements with system reliability needs, MISO is positioning the grid to handle future challenges better. These changes, scheduled for implementation by PY 2028-2029, will ensure that our energy infrastructure remains robust, resilient, and capable of supporting our clean energy goals.
For additional reading -
https://www.utilitydive.com/news/miso-reliability-reserves-transmission-blackout/629619/ MISO can improve reliability before building transmission
https://cdn.misoenergy.org/2022%20State%20of%20the%20Market%20Analytical%20Appendix629423.pdf - 2022 State of the Market report