# 1.0 Executive Summary

As envisioned in the Regional Representative Group's (RRG) regional
proposal, Grid West will act as the central scheduling authority for the
Grid West Managed Transmission System (GWMTS). Grid West\'s flow based
physical scheduling process requires that all Grid West participants who
intend to schedule energy on the GWMTS must have applicable physical
transmission rights, either existing rights or Grid West issued
Injection/Withdrawal Rights (IWRs), for their schedules. Such rights
must have proper duration and cover all scheduling points of associated
with the energy schedule. Grid West\'s recurrent reconfiguration service
(RCS), is intended to enable Grid West participants to acquire IWRs that
they need for their energy scheduling needs.[^1]

To effectively carry out its RCS services and functions, For Grid West
needs to develop and implement all business processes and technology
solutions to efficiently process and manage information about
transmission rights. Such information includes affiliated Transmission
Owners\' Rights Obligations (TOROs) as well as the existing transmission
rights of individual Grid West participants if and when these
participants request for their rights to be \"translated\" by Grid West.
It should also include all information on IWRs whether voluntarily
translated from existing rights, bilaterally acquired and registered by
Grid West, or issued as part of capacity expansion process. We refer to
the processes and systems that enable Grid West to manage rights
information as \"Rights Data Translation Management (RDTM).\"

Rights data translation for Grid West participants takes place in three
steps: First, a Grid West participant, such as a transmission customer,
submits a request to Grid West to \"ascertain\" the information about
its rights.[^2] Second, and once the rights information is known, the
participant can request that the translated right data be inventoried by
Grid West. Third, the participant can request that the right be further
translated into a single IWR or set of IWRs, as applicable. All
information on IWRs is also stored by Grid West as part of the RDTM
process. Upon completion of these steps, the participant can offer the
translated IWRs into various RCS processes for possible trading, offer
the flexibility associated with the ETR, if any, into DA-RCS for
possible trading, or use the translated right (as ETR or IWR) to
directly schedule its energy transactions with Grid West - rather than
schedule through an affiliated TO. The accompanying RCS white paper
describes how such translated rights are processed for reconfiguration
service.

This white paper presents the main features of the RDTM and shows that:

-   RDTM will enable Grid West to efficiently and accurately account for
    all existing rights obligations of the affiliated transmission
    owners;

-   RDTM will enable Grid West to efficiently and accurately account for
    all existing transmission rights and their full existing scheduling
    flexibilities (ESFs); and

-   RDTM will enable Grid West to efficiently and accurately process
    rights data, whether an existing right or an IWRs, to fulfill its
    regional and CCA responsibilities, including:

    -   Validation of ESF and IWR offers into the RCS processes;

    -   Validation of energy schedules;

    -   Calculation of AFCs; and

    -   Execution of IWR auctions.

# 2.0 Problem Statement

Currently, no single entity has a regional view of the Northwest
transmission system. The region's transmission capacity is managed
principally on a "contract path" basis by 17 individual control areas.
The contract path methodology does not match the physical operation of
the transmission grid. In addition, each Transmission Operator
determines its available transmission capacity based upon unique
criteria.

As a part of its Basic Functions, Grid West will manage all energy
scheduling in the GWMTS. In this role, Grid West will not only have a
regional view of the transmission system but will centrally mange
transmission capacity in an independent manner. This new scheduling
paradigm should have the capability to account for and honor all
existing transmission rights, along with their full flexibilities, as
well as acquired IWRs. The same capability needs to be extended to all
Grid West services that use rights data, e.g., to the reconfiguration
service.

# 3.0 Objectives and Design Criteria

In order for Grid West to efficiently and accurately carry out the
majority of its services and functions that rely on transmission rights
information, it need to develop processes and systems to systematically
and [electronically]{.underline} deal with rights data. Grid West\'s
Rights Data Translation Management (RDTM) is intended to provide such
capability. RDTM should consist of processes and systems that would
enable Grid West to:

1.  Create a uniform and yet flexible format for rights data for ease of
    storage and referencing without overlooking any of the rights
    characteristics;

2.  Inventory existing Transmission Owner Rights Obligations (TOROs) by
    storing all related rights data in Grid West;

3.  Ascertain the existing rights of Grid West participants, upon their
    request, and inventory the same rights if also requested;

4.  Translate existing rights identified above into IWRs, upon
    participants request, and inventory the same if also requested by
    such participants;

5.  Issue long-term IWRs as part of translating capacity expansions for
    a party who has invested in the capacity expansion; and

6.  Register bilaterally traded rights data.

# 4.0 RDTM Process and Methodology

## 4.1 Rights Data Format Development

Rights Data Format (RDF) development is the single most critical step in
implementation of the RDTM. RDF should be flexible enough to account for
all existing rights/obligations flexibilities and uniform enough to be
efficiently stored and accessed in industry standard data storage
technologies, e.g. relational databases. For this purpose we will use a
format that contains the following information:

1.  Right Identifiers: Uniquely identifies each right;

2.  Right Owner(s): Identifies entity(ise) who own such right, if
    applicable;

3.  \"Right "Authorized Representative (RAR)" Identifies the entity that
    can interface with Grid West regarding rights use and finances (this
    is expected to normally be the right owner);

4.  Right Status/Origination: Identifies the status/history of the right
    including its origin within a TORO, if applicable;

5.  Right Duration: Identifies calendar duration of the right (e.g.,
    from now till 2050);

6.  Right Timeline: Identifies duration of the right applicability
    (e.g., summer 2006 peak);

7.  Right Injection Point(s): Identifies all scheduling point(s) that
    can be used as the right injection point(s);

8.  Injection Right Value(s), or value ranges, at individual Right
    injection point(s): Identifies injections right MW value, range of
    values, at individual injection point(s);

9.  Right Withdrawal Point(s): Identifies all scheduling point(s) that
    can be used as the right withdrawal point(s);

10. Withdrawal Right Value(s) \[or value range(s)\] at individual
    withdrawal points: Identifies injections right MW value, range of
    values, at individual injection point(s); and

11. Overall Right Constraint: Identifies a overall constraining factor
    on an existing right such as the fact that total injection right
    where rights are presented in a range is limited

The following table is intended to show this general format for an 800
MW flexible multipoint to multipoint right, held by the Grid West
participant \"GWP2\" through year 2020, from scheduling points A, B and
C to scheduling points U and V where injection and withdrawal rights at
every one of these scheduling points is also a variable as follows:

-   Up to 400 MW injection right at scheduling point A

-   Up to 300 MW injection right at scheduling point B

-   Up to 300 MW injection right at scheduling point C

-   Up to 400 MW withdrawal right at scheduling point U

-   Up to 600 MW injection right at scheduling point V

The flexibility is shown in the Table in the form of the variable
injection and withdrawal rights at the scheduling points associated with
the right.

> Table 4.1: Uniform Right Data Format

+------------------------+---------------------------------------------+
| > **Right Attribute**  | > **RDF Value**                             |
+------------------------+---------------------------------------------+
| > Right Identifier     | > ETR2-MPtMP-2020                           |
+------------------------+---------------------------------------------+
| > Right Ownership      | > GWP2                                      |
+------------------------+---------------------------------------------+
| > Right Authorized Rep | > GWP2                                      |
+------------------------+---------------------------------------------+
| > Right                | > ETR2-GWP2                                 |
| > Status/Origination   |                                             |
+------------------------+---------------------------------------------+
| > Right Duration       | > Now to 12/31/2020-HE24                    |
+------------------------+---------------------------------------------+
| > Right Timeline       | > Regular                                   |
+------------------------+---------------------------------------------+
| > Right Injection      | > Buses A & B & C                           |
| > point(s)             |                                             |
+------------------------+---------------------------------------------+
| > Injection Right      | > IR~A~ [\<]{.underline} 400MW & IR~B~      |
| > value(s)             | > [\<]{.underline} 300MW & IR~C~            |
|                        | > [\<]{.underline} 300MW                    |
+------------------------+---------------------------------------------+
| > Right Withdrawal     | > Buses U & V                               |
| > point(s)             |                                             |
+------------------------+---------------------------------------------+
| > Withdrawal Right     | > WR~U~ [\<]{.underline} 400MW & WR~V~      |
| > value(s)             | > [\<]{.underline} 600MW                    |
+------------------------+---------------------------------------------+
| > Overall Right        | > \[IR~A~ + IR~B~ + IR~C~ = WR~U~ + WR~V~\] |
| > Constraint           | > [\<]{.underline} 800                      |
+------------------------+---------------------------------------------+

The format presented in the above table is flexible enough to hold all
information about the rights and can be readily implemented within a
relational database framework.

## 4.2 Transmission Owner Rights Obligation Inventorying

This process involves inventorying and electronically storing aggregated
Transmission Owners Rights Obligations (TOROs) in the RDF format. Due to
the flexibility of RDF, this process is expected to be very
straightforward. Grid West will use this inventory, among other
applications, for AFC calculation as part of the RCS process.

Inventorying rights as aggregate TO obligations implies that TOs will
remain responsible for validating the schedules of their transmission
customers before they are submitted to Grid West - as envisioned in the
RRG proposal for the first two years of Grid West operation. As
transmission customers translate their existing rights (see below), they
can directly interact with Grid West for their energy scheduling
responsibilities.

## 4.3 Existing Rights Translation

This step involves those Grid West participants who want to voluntarily
ascertain their existing transmission rights and potentially inventory
them.

In this step, a participant would ask Grid West to identify its right.
Grid West, based on knowledge of existing rights and in cooperation with
the impacted TO \[discussion point: should TO be made part of this
process\] will identify the participant\'s right and present it to the
participant in the RDF structure. If requested, Grid West could also
provide a non-binding estimate of the value of such right based on
historical clearing prices of the scheduling points
involved.\[discussion point: this function be somewhat arduous and the
results somewhat subjective and subject to potential litigation.\].

At this time, the Grid West participant may voluntarily request that the
right, so translated, be inventoried by Grid West so that the
participant can become responsible for directly dealing with Grid West
regarding administration and processing of its rights (e.g.,
scheduling). After inventorying of the translated right, Grid West will
adjust all affected TOROs to reflect such translation and avoid double
booking of AFC.

\[Discussion Points: 1) should Grid West require a fee for this service
so that folks do not ask for this service frivolously? And 2) should
Grid West make this translation out of TORO permanent?\]

## 4.4 IWR Translation

This step involves those Grid West participants who wish to voluntarily
translate part of all of their ETR, as identified and inventoried above,
into a single IWR or set of IWRs, as applicable, for a specific right
timeline or for the entire duration of the ETR.[^3]

Once an ETR is translated into IWRs of certain durations, say one month,
these IWRs could be offered into all applicable RCS auctions. For
example if the IWR is for the month of June 2009, it can be offered into
Annual, Monthly, Intra-monthly or DA RCS auctions and for June of 2009.
Once a portion of the IWRs is awarded (traded) in, say, the monthly RCS
auction, that portion is taken out of the IWR and the remaining IWRs can
be offered into other, and shorter-term, RCS auctions.[^4]

## 4.5 Long-term IWR Issuance

Grid West participants who invest in capacity expansion may request to
be issued long-term IWRs as part of their compensation for investing in
transmission capacity expansions. The issuance of long-term IWR can
occur as part of two different processes:

1.  Direct request for long-term IWR issuance: In this process, the Grid
    West participant requests long-term IWRs from Grid West. Grid West,
    in cooperation with the TOs, will conduct the relevant long-term
    transmission planning studies to identify whether and what \"least
    cost\" regional capacity expansions will be required to grant the
    requested IWR. If no capacity expansion is necessary, the IWRs may
    be issued and inventoried in the RDTM database. \[Discussion point:
    should there be any fees for the long-term AFCs used for this
    request?\] If capacity expansion is necessary, the requesting
    participant could either reduce the level of its long-term IWR
    request (to such a level that no capacity expansion is needed) or
    commit to pay for the necessary expansions. In the latter case, once
    financial commitment is made, the IWRs can be issued to the
    investing participant and inventoried in the RDTM database.
    \[Discussion point: should there be any fees for the long-term AFCs
    used for this request?\]

2.  Request for long-term IWR issuance based on non-IWR spawned capacity
    expansion: This situation occurs when a Grid West participant is
    investing in network capacity expansion for reasons other than
    direct request for IWR - such as for interconnecting new supply to
    the system. In this case, the investing participant can ask for a
    set of specific IWRs. If Grid West, based on long-term planning
    studies performed in cooperation with the TOs, determines that the
    requested long-term IWRs could be met, it will issue the long-term
    IWRs; otherwise, either Grid West or the participant can come up
    with reduced IWRs that can be accommodated with the planned expanded
    network.

## 4.6 Rights Data Registration

Registration of bilaterally traded transmission rights, whether ETRs or
IWRs, is another process of RDTM. A Grid West participant who has
bilaterally purchased rights will initiate the registration process with
Grid West. Grid West will investigate the transaction through
interaction with the selling counterparty and the impacted TO. If
confirmed, Grid West will register the transaction and modify its ETR
inventory accordingly.

# 5.0 Inputs & Outputs

The data flow diagram of Figure 5 shows all the inputs and outputs of
the RDTM process:

# ![](media/image1.wmf)

# 6.0 Roles and Responsibilities

Table 6 below presents the roles and responsibilities of the Grid West
and its participants related to RDTM:

Table 6 - Grid West and its participants\' roles and responsibilities in
RCS

+----------+----------------------+-----------------+----------------+
| RDTM     | Grid West            | Transmission    | Grid West\     |
| Function |                      | Owners          | Participants   |
+==========+======================+=================+================+
| RDF      | -   Develop RDF      | -   Participate | -              |
| Dev      |                      |                 |    Participate |
| elopment |                      |                 |                |
+----------+----------------------+-----------------+----------------+
| TORO     | -   Receive and      | -   Provide all | -   Monitor??  |
| Inve     |     review TORO data |     TORO        |                |
| ntorying |                      |     information |                |
|          | -   Format into RDF  |                 |                |
|          |                      |                 |                |
|          | -   Store in RDTM    |                 |                |
|          |     database         |                 |                |
+----------+----------------------+-----------------+----------------+
| ETR      | -   Receive and      | -   Assist Grid | -   Request    |
| Tra      |     review ETR       |     West with   |     ETR        |
| nslation |     translation      |     ETR review  |                |
|          |     request          |                 |    translation |
|          |                      |                 |                |
|          | -   Issue ETR        |                 |                |
|          |     certificate      |                 |                |
+----------+----------------------+-----------------+----------------+
| IWR      | -   Receive and      | -   Assist Grid | -   Request    |
| Tra      |     review IWR       |     West with   |     IWR        |
| nslation |     translation      |     IWR review  |                |
|          |     request          |                 |    translation |
|          |                      |                 |                |
|          | -   Issue IWR        |                 |                |
|          |     certificate      |                 |                |
+----------+----------------------+-----------------+----------------+
| L        | -   Receive and      | -   Assist Grid | -   Request    |
| ong-term |     review IWR       |     West with   |     long-term  |
| IWR      |     translation      |     system      |     IWRs       |
| Issuance |     request          |     planning    |                |
|          |                      |     studies     |                |
|          | -   Perform planning |                 |                |
|          |     studies and      |                 |                |
|          |     identify         |                 |                |
|          |     potential system |                 |                |
|          |     upgrades         |                 |                |
|          |                      |                 |                |
|          | -   Issue IWR        |                 |                |
+----------+----------------------+-----------------+----------------+
| Rights   | -   Receive and      | -   Assist with | -   Submit     |
| Data     |     review/confirm   |                 |                |
| Regi     |     registration     |    registration |   registration |
| stration |     request          |     review      |     request    |
|          |                      |                 |                |
|          | -   Register         |                 |                |
|          |     bilaterally      |                 |                |
|          |     traded rights    |                 |                |
|          |     data             |                 |                |
+----------+----------------------+-----------------+----------------+

# 7.0 Revenue Allocation

There are no direct revenues from this service for Grid West.
\[Discussion point: Exception applies to revenues from the sale of AFC
for long-term IWR requests. In such a case such revenue will be posted
against R3A.\]

# 8.0 Market Power & Market Efficiency Considerations

There are not many known and direct market power issues associated with
Grid West\'s RDTM service. In those cases, when an entity requesting
long-term IWRs has strong energy positions in the market, the entity can
use the granted IWRs to gain market power. This is a well know scenario
that can be readily addressed by established remedies such as:

-   Limit granting IWRs to entities with dominant energy positions

-   Require entities with dominant energy positions to offer their
    acquired IWRs into RCS as price takers

Care should be exercised so that these market rules would apply to IWRs
attained through secondary/bilateral trade.

# 9.0 Market Benchmarks

Existing RTOs and ISOs have normally converted their participants\' ETRs
into FTRs (and/or ARRs) on a single occasion. After conversion to
FTR/ARR, the ETR ceases to exist in its original form. One of the most
contrasting features of Grid West, compared with its counterparts, is
that Grid West, through RDTM will ensure that holders of existing rights
can hold onto and exercise those rights for its entire term. Tables 9a
and 9b provides a more detailed comparison of Grid West with PJM, ERCOT
and MISO.

Table 9a - Comparing Grid West RDTM with FTR management in other
RTOs/ISOs

+----------+--------------------+-------------------+-----------------+
| RDTM     | PJM                | ERCOT             | MISO            |
| Function |                    |                   |                 |
+==========+====================+===================+=================+
| RDF      | -   FTR format is  | -   TCR format is | -   FTR format  |
| Dev      |     very similar   |     very similar  |     is very     |
| elopment |     to that of IWR |     to that of    |     similar to  |
|          |                    |     IWR           |     that of IWR |
|          | -   No format for  |                   |                 |
|          |     handling ETRs  | -   ETRs are      | -   No format   |
|          |                    |     addressed by  |     for         |
|          |                    |     taking ATC    |     handling    |
|          |                    |     out of the    |     ETRs        |
|          |                    |     system        |                 |
+----------+--------------------+-------------------+-----------------+
| TORO     | -   No direct      | -   No direct     | -   No direct   |
| I        |     dealing with   |     dealing with  |     dealing     |
| nventory |     TOs on         |     TOs on        |     with TOs on |
|          |     existing       |     existing      |     existing    |
|          |     rights         |     rights        |     rights      |
+----------+--------------------+-------------------+-----------------+
| ETR      | -   No such        | -   No such       | -   No such     |
| Tra      |     capability     |     capability    |     capability  |
| nslation |                    |                   |                 |
+----------+--------------------+-------------------+-----------------+
| IWR      | -   One time       | -   One time      | -   One time    |
| Tra      |     translation of |     translation   |     translation |
| nslation |     ETRs to FTRs   |     of ETRs to    |     of ETRs to  |
|          |                    |     TCRs          |     FTRs        |
+----------+--------------------+-------------------+-----------------+
| L        | -   Similar        |                   |                 |
| ong-term |     principles as  |                   |                 |
| IWR      |     Grid West      |                   |                 |
| Issuance |                    |                   |                 |
|          | -   Process still  |                   |                 |
|          |     in flux due to |                   |                 |
|          |     lack of use    |                   |                 |
+----------+--------------------+-------------------+-----------------+
| Rights   | -   ??             | -   ??            | -   ??          |
| Data     |                    |                   |                 |
| Regi     |                    |                   |                 |
| stration |                    |                   |                 |
+----------+--------------------+-------------------+-----------------+

Table 9b - Duration of long-term rights issuance by some RTOs and ISOs

  ---------------- ------------------------------------------------------
  RTO/ISO          Life of Issued Right

  PJM              Lesser of life of upgrade or 30 years

  ISO-NE           Lesser of life of upgrade or payment for maintenance

  New Zealand      Life of upgrade
  ---------------- ------------------------------------------------------

# 10.0 Technology Solutions

Most of the technology solutions needed for RDTM are industry standard
products. Table 10 provides a summary of such required technologies.

Table 10 - Technology solutions for RDTM

  ---------------- ------------------------------------------------------
  RTO/ISO          Life of Issued Right

  RDF Development  Straightforward relational database (RDB) solutions.

  TORO Inventory   Straightforward database forms for entering TORO data
                   in RDF format.

  ETR Translation  Straightforward database forms for entering ETR data
                   in RDF format.

  IWR Translation  Straightforward database forms for entering IWR data.

  Long-term IWR    Full slate of planning models (industry standard
  Issuance         products) to study the feasibility of IWR requests and
                   potential need for new capacity expansions.

  Rights Data      Straightforward database forms for registering
  Registration     (entering) rights data in RDF format.
  ---------------- ------------------------------------------------------

# 11.0 Organization Requirements

Most RDTM processes are heavily manual and resource intensive as
presented in table 11 below.

Table 11 - RDTM Staff Requirements

+---------------+--------------+---------+----------------------------+
| Division      | Department   | Role    | Responsibility             |
+---------------+--------------+---------+----------------------------+
| Market        | Forward      | Manager | -   Same as RCS manager    |
| Operations    | Markets      |         |                            |
+---------------+--------------+---------+----------------------------+
| Market        | Forward      | Analyst | -   TORO inventorying (one |
| Operations    | Markets      | (5)     |     time effort for 6      |
|               |              |         |     months to one year)    |
+---------------+--------------+---------+----------------------------+
| Market        | Forward      | Analyst | -   ETR translation        |
| Operations    | Markets      | (2)     |                            |
|               |              |         | -   IWR translation        |
+---------------+--------------+---------+----------------------------+
| Planning      | Expansion    | Analyst | -   Long-term expansion    |
|               | Planning     | (6)     |     planning studies       |
+---------------+--------------+---------+----------------------------+
| Information   | Market       | Analyst | -   Application Support    |
| Technology    | Systems      | (2)     |                            |
+---------------+--------------+---------+----------------------------+
| Information   | Forward      | Analyst | -   Application Support    |
| Technology    | Markets      | (1)     |                            |
+---------------+--------------+---------+----------------------------+
| Information   | Expansion    | Analyst | -   Application Support    |
| Technology    | Planning     | (2)     |                            |
+---------------+--------------+---------+----------------------------+
| Information   | Market       | Analyst | -   Database Support       |
| Technology    | Systems      | (2)     |                            |
+---------------+--------------+---------+----------------------------+

# 12.0 Cost Drivers

RDTM primary cost drivers are due to manual processes involved in RDTM.
Such costs could be reduced if:

-   TOs performed all the footwork related TORO inventorying using the
    RDF and Grid West RDTM systems and under Grid West coordination

-   Grid West could increase the turn around of providing ETR and IWR
    translation services

-   TOs or WECC performed most planning studies related to long-term
    rights issuance with Grid West acting mainly as the coordinator.

[^1]: RCS is presented in detail in an accompanying white paper.

[^2]: For this purpose, Grid West inventory and store all existing
    Transmission Owner Obligations as part of the RDTM process.

[^3]: The motive for such an extra translation can be simply that there
    are additional forums to trade IWRs than there are for trading ETRs.

[^4]: In rare cases, and upon analysis and approval by Grid West, an IWR
    configuration may be changed from one RCS auction to another.