California Public Utilities Commission Releases Proposed Decision on Long-term RA Reform: “Slice of Day”

On March 3, 2023 the California Public Utilities Commission (“Commission”) released a Proposed Decision (“PD”) on long-term Resource Adequacy (“RA”) reform, adopting a Slice-of-Day (“SOD”) framework. The 24-hour SOD framework requires each load-serving entity (“LSE”) to demonstrate that it has enough capacity to satisfy its specific gross load profile, with a planning reserve margin, in each hour of the California Independent System Operator’s “worst day” of that month. The PD would implement the SOD framework in 2025, with 2024 as a test year. Among other RA program changes made, the PD also proposes the following:

  • Creates an LSE Showing Tool (template to be used by LSEs to make RA filings) and a Commission Verification Tool.
  • Planning Reserve Margin (“PRM”): Continued use of annual PRM to set overall system RA compliance obligation.
  • Tools: PD adopts the National Resources Defense Council's PRM validation tool and Southern California Edison’s showing tool for LSEs to use in providing their monthly and year ahead supply plans.
  • Conventional Resources: PD defers on adoption of Unforced Capacity Evaluation (“UCAP”)-light, which would derate available thermal capacity based on historic unscheduled outages and thermal derates.
  • Test Year: proposes limiting filings for 2024 test year to March, June, September.
  • Wind / Solar Profiles: Adoption of exceedance-based profiles. Rejects various parties’ proposals for effective load carrying capability benchmarking. Adopts Cal Advocates 12-season approach to calculating regionally differentiated exceedance thresholds. Allows use of modeling data for RA. Adopts a 12-season approach as the exceedance methodology to determine profiles for solar and wind resources under the SOD framework.
  • Counts dispatchable resources at their Pmax (maximum capacity of a resource) value.
  • Counts energy storage resources at their Pmax value and allows energy storage to show for multiple cycles per day as long as the LSE shows sufficient excess energy and time between discharge and charge. Does not require resources needed by LSE to charge storage to have full capacity deliverability status.
  • Creates a Master Resource Database (“MRD”) that contains resources eligible to sell RA and includes the resources’ key attributes, such as available MW of RA capacity and hours available for production.
  • Characterizes hybrid resources in the MRD as either charging exclusively on-site or allowing grid charging. An energy-only (“EO”) resource is eligible to count towards the storage charging sufficiency requirement if the EO resource is charging exclusively on-site storage. The charging capacity of the renewable resource will be capped at the amount that can be used to charge the on-site storage and the storage will be capped at the interconnection limit. Hybrid components will be shown as separate assets on the MRD and LSEs’ showings, and the total of the components must not exceed the interconnection amount in any hour.

Comments on the PD are due March 23rd, and reply comments are due March 28th. The earliest the Commission will consider the PD is at the agency’s April 6th Business Meeting.

Contact: Brian Biering, Jessica Melms