NOTICE DATE: July 25, 2024

NOTICE TYPE: M-C031324-05 Contracts / RFP

SHORT DESCRIPTION: Issuance of Request for Proposal for Must-Run Alternatives Associated with the Notifications of Suspension of Operations for BRAUNIG_VHB1, BRAUNIG_VHB2, and BRAUNIG_VHB3 and Posting of Part III of CPS Energy NSOs

INTENDED AUDIENCE: All Market Participants

DAYS AFFECTED: July 25, 2024 and thereafter 

LONG DESCRIPTION: ERCOT has issued a Request for Proposal (RFP) seeking one or more Must-Run Alternatives (MRA) to a Reliability Must-Run (RMR) contract with CPS Energy to address projected reliability needs associated with the proposed suspension of BRAUNIG_VHB1, BRAUNIG_VHB2, and BRAUNIG_VHB3 (“Braunig Resources”).  ERCOT has also posted, on the MIS Secure Area, the Parts III of the Notifications of Suspension of Operations (NSO) for the Braunig Resources, which CPS Energy submitted today.  

As described in ERCOT’s April 22, 2024 Market Notice, ERCOT has determined that the Braunig Resources are needed to support ERCOT System reliability after the proposed March 31, 2025 suspension date because their unavailability would have a material impact on identified ERCOT System performance deficiencies.  Under Section 3.14.1.2 of the ERCOT Protocols, this determination triggered ERCOT’s obligation to issue an RFP for MRAs and CPS Energy’s obligation to submit Part III of the NSO.  While Protocols Section 3.14.1.2 requires these actions to be performed within ten days of the issuance of ERCOT’s determination, the Public Utility Commission of Texas (PUCT) on May 2, 2024 issued an order granting ERCOT’s request for a good cause exception to the Protocols’ MRA- and RMR-related process deadlines, authorizing a delay of both the issuance of this RFP as well as the submission of Parts III of the NSOs. Today’s RFP issuance and NSO Part III postings are consistent with the procurement schedule ERCOT submitted to the PUCT and described in its July 12, 2024 Market Notice.

The MRA RFP seeks proposals from Qualified Scheduling Entities (QSE) to provide one or more MRA Resources that would address the identified ERCOT System performance deficiencies in a more cost-effective way than committing one or more of the Braunig Resources through an RMR contract.  Under the RFP, QSEs may offer MRA Resources for any one or more seasons during the period of April 1, 2025 through March 31, 2027.  The RFP identifies different hours in which an offered MRA Resource must be available each season.  Resources eligible to be considered as an MRA Resource include various types of generation, storage, and Demand response (DR) as further described in the RFP and the Governing Document posted on the RFP page of ERCOT website. 

Offers will be evaluated based on the offered price and the ability of the offered MRA Resource to reduce pre-contingency and post-contingency loading on the 345-kV transmission lines that are subject to the South Texas Export Interconnection Reliability Operating Limits (IROLs) during certain specified outage conditions.  Proposals will be awarded on an as-bid basis. 

In accordance with the procurement schedule described in the RFP, offers are due 3:00 p.m. Central Prevailing Time (CPT) on September 9, 2024.  ERCOT will host a workshop on August 15, 2024 to discuss the RFP and respond to questions.  Consistent with the posted schedule, ERCOT anticipates providing an amended RFP on August 21, 2024 that will provide further clarification of the required performance characteristics, such as a maximum amount of megawatt hours (MWh) or a maximum duration per deployment for storage or DR MRA Resources.  Following its review of all proposals, ERCOT will provide a recommendation to the ERCOT Board of Directors at its October 2024 meeting.  

CPS Energy’s NSO Part III submissions indicate that the standby cost for the Braunig Resources are as follows:

• BRAUNIG_VHB1: $3,330 per hour for one year, $2,263 per hour for two years;
• BRAUNIG_VHB2: $3,222 per hour for one year, $2,203 per hour for two years; and
• BRAUNIG_VHB3: $4,171 per hour for one year, $2,904 per hour for two years.

This standby cost must be based on CPS Energy’s initial estimated budget. 

The Braunig MRA RFP is posted on the RFP page of ERCOT website.  Part III of the NSO is posted on the Notice of Suspension of Operations portion of the Generation page of the ERCOT Market Information System (MIS) Secure Area.  An ERCOT Digital Certificate is required to access the MIS. 

CONTACT: Stakeholder inquiries concerning this RFP must be directed in writing to Jason Terrell, ERCOT Manager of Procurement and Contract Administration, at jason.terrell@ercot.com.  

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