NOTICE DATE: August 21, 2024

NOTICE TYPE: M-C031324-06 Contracts / RFP

SHORT DESCRIPTION: Issuance of Revised Request for Proposal for Must-Run Alternatives Associated with the Notifications of Suspension of Operations for BRAUNIG_VHB1, BRAUNIG_VHB2, and BRAUNIG_VHB3

INTENDED AUDIENCE: All Market Participants

DAYS AFFECTED: August 21, 2024 and thereafter

Consistent with the posted procurement timeline, ERCOT has issued a Revised 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”).  

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, inter alia, ERCOT’s obligation to issue an RFP for MRAs.  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 the issuance of this RFP. 

The Revised 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 Revised RFP, QSEs may offer MRA Resources for any one or more seasons during the period of April 1, 2025 through March 31, 2027.  The Revised 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 Revised RFP, including in its appendix Governing Document, posted on the RFP page of the 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 if the ERCOT Board of Directors approves the provision of MRA service. 

Among the changes in the Revised RFP is an updated schedule that extends the deadline to submit a Proposal; all Proposals are now due 3:00 p.m. Central Prevailing Time (CPT) on Monday, October 7, 2024.  Other changes in the Revised RFP include changes to the hours of obligation each season; changes to the months included in the spring and summer seasons; further clarification of the required MRA Resource performance characteristics, including a maximum three-hour duration per deployment for storage or DR MRA Resources and a limit on the number of deployments for DR MRA Resources each season; and removal of telemetry requirements for unregistered MRA Resources. 

Following its review of all Proposals, ERCOT intends to provide a recommendation to the ERCOT Board of Directors regarding potential MRA and/or RMR service at the Board of Directors' December 2024 meeting.  

The Revised RFP, including its appendices, is posted on the RFP page of the ERCOT website.  Also posted are blackline comparisons showing differences between the initial version of the RFP, including its Governing Document, (that was posted on July 25, 2024) and the Revised RFP posted today.  

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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