Summary of NERC Penalties
Quarter 3 - August 2023
Big River Steel LLC (BRS) and Entergy Arkansas, LLC (EAL)
§38.2.5(d)(ii)(e) of the MISO Tariff
Entergy Arkansas sold energy through MISO's markets for reduced energy usage on behalf of BRS. However, BRS did not reduce energy consumption levels in response to demand response offers, violating § 38.2.5(d)(ii)(e) of the MISO Tariff.
Big River Steel operates a steel mill that uses as much as 300 megawatts (MW) to operate electric arc furnaces and other equipment. The mill is in Osceola, Arkansas, within MISO’s footprint. Big River Steel’s load levels at its mill rise and fall in the normal course of business as it turns smelters and other equipment on and off.
Entergy Arkansas is a Load Serving Entity (LSE), providing distribution service to approximately 725,000 retail electric customers, primarily in Arkansas.
Entergy Arkansas served as the Market Participant for BRS’s participation as a DRR-1 unit in MISO. As a result, BRS submitted its demand response offers through EAL and received payments from MISO through EAL. Nevertheless, it was BRS that decided what offers to submit in MISO’s Day Ahead and Real Time markets and what BRS would do if its offers were accepted.
In 2016, BRS and EAL entered into a supplemental agreement to give BRS direct access to the MISO web portal. This agreement makes BRS responsible for “reducing the electric demand or load of the Facility in accordance with MISO instructions, directions, or other notifications and the MISO Rules, including MISO instructions, directions, and other notifications communicated through the MISO Portal.”
Big River Steel participated in MISO as a DRR-1 unit throughout the Relevant Period. With the exception of a seven-day period during Winter Storm Uri (Feb. 16-22, 2021), BRS did not change mill operations to alter energy consumption levels when MISO accepted its demand response offers. Instead, BRS operated its mill at the same load levels as it would have if it had not been a DRR-1 unit.
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