IEEE Power & Energy Magazine - March/April 2022 - 56

independent system operator (ISO) and a distribution-level
DSO. The demonstration's design assumes that prices and
needs in the wholesale market are communicated to DERs
such that the installations may contribute to services at both
the distribution and transmission levels. ISO-DSO coordination,
especially in the context of DSOs procuring services
from DERs for distribution-level needs, is an important area
for future work.
As an extension of the demonstration, a study is being
initiated to conduct a steady-state power flow analysis of
several scenarios. They relate to DERs being used for distribution
NWA purposes while simultaneously being available
to the wholesale market as appropriate. In particular,
the study will investigate whether DER output can be delivered
to the distribution-transmission interface under various
conditions, some of which will involve distribution system
constraints that may restrict a DER's ability to provide
services to the transmission level. The analysis of the deliverability
of DER output will be used to inform potential
ISO-DSO coordination processes. It will also contribute to
developing rules for participating DERs to simultaneously
bid in auction processes at the distribution and wholesale
market levels.
A technical paper is being prepared in the context of the
demonstration as well as to propose methods for conducting
distribution expansion planning to inform the design of local
capacity auctions. The proposed methods will use the net
present value of employing DERs to defer distribution network
upgrades to help DSOs decide whether to acquire DERs
and to set parameters for procurement. These studies include
conducting distribution expansion planning to assess the
tradeoff between investments in wires and DERs as NWAs to
determine when those outlays are needed and assess the cost
savings for a DSO from pursuing NWA projects. The cost
savings, in turn, will be used to influence the DSO's willingness
to pay for DERs. The results of the distribution expansion
planning model will be employed to enhance the design
of local capacity auctions, including minimum and maximum
limits for procuring DER capacity in different locations in
the distribution system to meet existing and expected needs.
The enhanced design will also produce capacity price separation
in the system, sending participants in local capacity auctions
improved price signals for making DER investments.
Publications about the project are expected in late 2022.
Conclusions
As DERs continue to improve in performance and decrease
in cost, and as transportation and heating become electrified,
the distribution system will evolve to become more
dynamic in the coming years. Increased DER installation
will provide new opportunities to generate value and reduce
system costs, including those related to the distribution system.
A key use case for DERs relates to employing them
as NWAs at the distribution level. The IESO's York Region
NWA demonstration involves securing DERs for capacity
56
ieee power & energy magazine
service, activating DERs for energy service, and scheduling
and deploying DERs as part of reserve service. The project
shows that a DSO can use auction mechanisms at the distribution
level to manage NWA projects and create an open,
fair, competitive, and transparent marketplace, lowering
costs to participate and other barriers to entry. Auctions
have a very natural fit in a future environment with mass
participation of DERs that provide granular grid services
in automated ways through intelligent software and Internet
communication.
For Further Reading
" Active engagements-IESO York region non wires alternatives
demonstration project, " Independent Electricity System Operator.
Accessed: 2021. [Online]. Available: www.ieso.ca/en/
Sector-Participants/Engagement-Initiatives/Engagements/
IESO-York-Region-Non-Wires-Alternatives-Demonstra
tion-Project
J. Prince, J. Waller, L. Shwisberg, and M. Dyson, The
Non-wires Solutions Implementation Playbook: A Practical
Guide for Regulators, Utilities, and Developers. Rocky
Mountain Institute, 2018. [Online]. Available: http://www
.rmi.org/insight/non-wires-solutionsplaybook
S. P. Burger, J. D. Jenkins, S. C. Huntington, and I. J.
Perez-Arriaga, " Why distributed?: A critical review of the
tradeoffs between centralized and decentralized resources, "
IEEE Power Energy Mag., vol. 17, no. 2, pp. 16-24, Mar./
Apr. 2019, doi: 10.1109/MPE.2018.2885203.
S. Succar, M. Alter, H. Siddiqui, L. Kristov, and P. De
Martini, " Development of a transmission-distribution interoperability
framework, " in Proc. ICF Independent Electricity
Syst. Operator, Toronto, 2020.
R. Tabors, G. Parker, P. Centollela, and M. Caramanis,
White Paper on Developing Competitive Electricity Markets
and Pricing Structures. Boston, MA, USA: Tabors Caramanis
Rudkevich, 2016.
M. Caramanis, E. Ntakou, W. W. Hogan, A. Chakrabortty,
and J. Schoene, " Co-optimization of power and reserves
in dynamic T&D power markets with nondispatchable
renewable generation and distributed energy resources, "
Proc. IEEE, vol. 104, no. 4, pp. 807-836, Apr. 2016, doi:
10.1109/JPROC.2016.2520758.
Biographies
Ali Golriz is with the Independent Electricity System Operator,
Toronto, M5H 1T1, Canada.
Inna Vilgan is with the Independent Electricity System
Operator, Toronto, M5H 1T1, Canada.
Hamza Mortage is with Alectra Utilities, Vaughan, L4H
0A9, Canada.
Fahimeh Kazempour is with Alectra Utilities, Vaughan,
L4H 0A9, Canada.
Mohamed Ahmed is with the Independent Electricity
System Operator, Toronto, M5H 1T1, Canada.
p&e
march/april 2022

http://www.ieso.ca/en/Sector-Participants/Engagement-Initiatives/Engagements/IESO-York-Region-Non-Wires-Alternatives-Demonstration-Project http://www.ieso.ca/en/Sector-Participants/Engagement-Initiatives/Engagements/IESO-York-Region-Non-Wires-Alternatives-Demonstration-Project http://www.ieso.ca/en/Sector-Participants/Engagement-Initiatives/Engagements/IESO-York-Region-Non-Wires-Alternatives-Demonstration-Project http://www.ieso.ca/en/Sector-Participants/Engagement-Initiatives/Engagements/IESO-York-Region-Non-Wires-Alternatives-Demonstration-Project http://www.rmi.org/insight/non-wires-solutionsplaybook http://www.rmi.org/insight/non-wires-solutionsplaybook

IEEE Power & Energy Magazine - March/April 2022

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