On January 14, 2019, FERC issued a letter order accepting, as of October 15, 2019, Midcontinent Independent System Operator’s (“MISO”) proposal to implement a “Fast First” Automatic Generation Control (“AGC”) framework that, as MISO argues, would deploy fast-ramping generation resources more efficiently.  MISO explained that the Fast First AGC framework would better utilize and incentivize fast-ramping resources, including energy storage resources (“ESRs”), for frequency regulation.  MISO stated that, with increased supply-side volatility on its system due to integration of intermittent renewable resources, new AGC signals were needed for better system control and to better utilize the fast response rate of fast-ramping resources.

Currently, MISO uses AGC as a method of frequency regulation to ensure that its system is balanced.  Specifically, AGC allows MISO to send signals to generators to increase or decrease real power injections or withdrawals, correcting actual or anticipated frequency deviations or interchange schedule imbalance.  According to MISO’s Fast First AGC filing, submitted in August 2019 and amended in November 2019, the previously-existing AGC system was load-following, deploying fast-ramping resources first (due to high priority ranking), and un-deploying them last (in the reverse order).  MISO defines fast-ramping resources as those that have a ramp rate greater than 80 MW per minute, that meet certain thresholds for consistency in responding to regulation signals, and that can be deployed for longer than 20 minutes.

In its filings, MISO stated that although its prior AGC approach effectively met system reliability needs, it also resulted in fast-ramping resources providing frequency regulation for longer durations than slower-ramping resources; underutilized fast-ramping resources to address fast-changing system balancing needs; and, for ESRs, failed to take into account real-time state of charge as a criteria for choosing the best resources to deploy.  MISO therefore proposed the Fast First AGC framework as way to more efficiently use fast-ramping resources.  As MISO explained, under this framework, fast-ramping resources will be deployed first, achieving system balance quickly.  Slow-responding resources, i.e., traditional generation, would then be deployed next.  As the slow-responding resources start responding to the deployment signal, fast-ramping resources could then be backed down, thereby preserving them for longer participating in future frequency regulation deployment.

According to MISO, slower-ramping resources will continue to receive the same AGC signals, while fast-ramping resources will receive the new Fast First AGC signals.  Although the Fast First AGC framework allows fast-ramping resources to be deployed ahead of slower-ramping resources, both types of resources will be compensated at the same rate using the existing market settlement rules, to the extent they are deployed.  MISO also estimated an initial $14 million in annual savings with an addition of 200 MW of fast-ramp resources into the MISO market.

FERC’s letter order is available here; MISO’s August 2019 and November 2019 filings are available here and here.