|
Server : Apache/2.4.62 System : FreeBSD fbsdweb2.web.rcn.net 14.1-RELEASE FreeBSD 14.1-RELEASE releng/14.1-n267679-10e31f0946d8 GENERIC amd64 User : www ( 80) PHP Version : 8.3.8 Disable Function : NONE Directory : /domains/enrgy/archives/ |
Upload File : |
<html>
<head>
<title>Fix TLR ASAP Said Plum St's Vanhorne</title>
</head>
<body style="font-family: Arial" vlink="#808080">
<div align="center"><center>
<table border="0" cellpadding="8" cellspacing="0" width="98%" bgcolor="#000000">
<tr>
<td width="100%" valign="middle"><a name="top"></a><img src="../images/pmamagsm.gif" alt="PMA Online Magazine" border="0" align="right" WIDTH="229" HEIGHT="100"></td>
</tr>
</table>
</center></div><div align="center"><center>
<table border="0" cellpadding="8" width="98%">
<tr>
<td width="25%" valign="top" align="center"><!--webbot bot="ImageMap" rectangle="(14,297) (97,322) http://www.powermarketers.com/adrates.html" rectangle="(11,230) (95,257) http://www.powermarketers.com/pmajobs.htm" rectangle="(12,163) (96,189) http://www.powermarketers.com/main.htm##_parent" rectangle="(12,95) (96,121) http://www.powermarketers.com/power2.htm##_blank" rectangle="(11,29) (96,54) ../pmamag.htm" src="../images/magmenu.gif" alt="PMA OnLine Magazine Menu" border="0" align="center" startspan --><MAP NAME="FrontPageMap"><AREA SHAPE="RECT" COORDS="14, 297, 97, 322" HREF="http://www.powermarketers.com/adrates.html"><AREA SHAPE="RECT" COORDS="11, 230, 95, 257" HREF="http://www.powermarketers.com/pmajobs.htm"><AREA SHAPE="RECT" COORDS="12, 163, 96, 189" HREF="http://www.powermarketers.com/main.htm" TARGET="_parent"><AREA SHAPE="RECT" COORDS="12, 95, 96, 121" HREF="http://www.powermarketers.com/power2.htm" TARGET="_blank"><AREA SHAPE="RECT" COORDS="11, 29, 96, 54" HREF="../pmamag.htm"></MAP><a href="../_vti_bin/shtml.dll/archives/tlr.htm/map"><img src="../images/magmenu.gif" alt="PMA OnLine Magazine Menu" border="0" align="center" ismap width="110" height="350" usemap="#FrontPageMap"></a><!--webbot bot="ImageMap" endspan i-checksum="45885" --><p><a href="../searchpma.htm"><img src="../images/archives.gif" alt="Archives Search" border="0" align="center" WIDTH="70" HEIGHT="40"></a></p>
<p> </p>
<p> </p>
<p> </p>
<p> </p>
<p> </p>
<p> </p>
<p> </p>
<p><a href="#top"><img src="../images/b-t-top.gif" alt="Back To Top" border="0" WIDTH="71" HEIGHT="35"></a></p>
<p> </p>
<p> </p>
<p> </p>
<p> </td>
<td width="75%" valign="top"><p ALIGN="left"><font face="Arial" size="6"><b><strong>FIX
TLR ASAP SAID PLUM ST'S VANHORNE</strong></b></font></p>
<p ALIGN="center"><font face="Arial" size="4"><b><strong>OUCH! 30 MW OF TLR CUTS 1,900 MW
OF SERVICE</strong></b></font></p>
<p><font face="Arial" size="4"><strong>BY SEASON HAWKSLEY<br>
RESTRUCTURING TODAY</strong><br>
(<em>originally published by PMA OnLine Magazine: 11/98</em>)</font><font size="4"></p>
</font><p><font face="Arial">"The transmission loading relief (TLR) process must be
fixed as soon as possible," says Philip VanHorne.</font><font SIZE="3"></p>
</font><p><font face="Arial">He's president of Niagara Mohawk's Plum Street Energy
Marketing. "I know of one case where 30 megs of TLR translated into 1,900 megs of
cuts in the transmission system. That's a problem for non-LMP systems," he told a
recent Energy Institute conference on northeast marketing. </font></p>
<p><font face="Arial">The argument that TLR is ruining locational marginal pricing (LMP)
isn't valid, VanHorne said however. "TLR as imposed by NERC has wreaked havoc in the
system," he added. VanHorne sees in TLR the failed General Agreement on Parallel
Paths that was not adopted. </font></p>
<p><font face="Arial">How can TLR be improved?</font></p>
<p><font face="Arial">"Replace it with a market-based system and let the dollars make
the decisions," he replied.</font></p>
<p><font face="Arial">"Firm service is not really firm. The party selling the service
has lost control and the ability to honor agreements."</font></p>
<p><font face="Arial">Remote systems can transfer the problems and costs
disproportionately to the size of the problem, leading to more losers than winners,
VanHorne explained. </font></p>
<p><font face="Arial">LMP, he thinks, needs to be implemented on a wider basis.</font></p>
<p><font face="Arial">"People say LMP is too complicated, but the old way was
complicated too," VanHorne said. "Most people never really investigated the
details. And artificial simplification does not necessarily help. Retail access programs
are another example of a complicated part of deregulation," VanHorne added.</font></p>
<p><font face="Arial">"LMP does create an unknown component," VanHorne observed.
"The change is in who has to deal with the unknown. Risk can be hedged with
transmission rights. The old system favored transmission utilities often in unknown or
non-obvious ways," he added.</font></p>
<p><font face="Arial">LMP is not too radical a change, according to VanHorne. "The
old system won't work with full open access. LMP allows the costs and benefits to go to
any participant, not just transmission owners. Without changing the pricing system, other
changes are impossible to implement. All of the alternatives are complex." </font></p>
<p><font face="Arial">"Many say `only an economist could think of this,'"
VanHorne noted. "But the implementers have mostly been engineers and interruptible
transmission professionals. The basic theory has been preserved, but many assumptions have
been necessary to actually implement LMP," VanHorne said.</font></p>
<p><font face="Arial">What needs to be done, we asked.</font></p>
<p><font face="Arial">"ISOs could be expanded," he said. "There are too
many steps and participants. New York doesn't need eight entities offering transmission
services."</font></p>
<hr>
<p><font FACE="Arial" SIZE="2"><strong>Restructuring Today</strong> is published 247 times
a year for those watching the convergence of electricity, telephone and gas markets. It's
issued on business days by US Publishing at 4418 MacArthur Boulevard, Washington DC 20007.
Phone 1-800-486-8201 or 202-298-8201 and fax to 1-202-298-8210. One year's subscription is
$487 in US funds (plus 8% sales tax in the District of Columbia). George Spencer, editor.
E-mail: <a href="mailto:[email protected]">[email protected]</a></font></p>
<p align="center"><font face="Arial" size="3"><a href="http://www.restructuringtoday.com">FREE
TRIAL</a></font></td>
</tr>
</table>
</center></div>
<p align="center"><a href="#top"><img src="../images/b-t-top.gif" alt="Back To Top" border="0" WIDTH="71" HEIGHT="35"></a></p>
</body>
</html>