Dialing in Your NYISO Load Forecasts

In power markets, accurate demand forecasts are essential for ensuring efficient resource use. However, there’s a special emphasis on peak demand hours, when more expensive generation resources are required, marginal prices increase, and forecast errors can lead to significant regulatory penalties and higher costs.

This means accurately forecasting the consumption and timing of daily peak loads is a priority for utilities, power traders, financial trading rights (FTR) traders, large power consumers, and battery system operators. However, their perspective on what constitutes a “useful” peak forecast changes depending on their use case.

Accurate peak load forecasting helps utilities and asset operators plan for sufficient capacity, prevent outages, and manage costs during periods of extreme demand. Financial trading rights (FTR) traders, meanwhile, need accurate peak load forecasts to predict grid congestion, optimize trading strategies, and capitalize on nodal price differences. Battery operators need to know the precise timing of the peak each day to optimize the charging and deployment of their batteries. This reduces their customers' demand at the highest price hours each day and reduces their consumption on the penalized coincident peak days of each season. 

Gain a Competitive Advantage in Your NYISO Load Forecasts 

Understanding how to evaluate power demand forecasts is the first step in ensuring accurate forecasts. A key part of that process involves evaluating and interpreting statistics to ensure electric load demand forecasts are accurate, consistent, and valuable. For example, although mean absolute percentage error (MAPE) is commonly used to evaluate energy forecasts, it’s not ideal. In power demand forecasting, root mean square error (RMSE) is a more reliable metric than MAPE because it avoids over-emphasizing errors during times when load is low – such as overnight hours.

Now let’s take a look at how Yes Energy's TESLA Demand Forecasting solutions performed at daily peaks from different users’ perspectives in the New York Independent System Operator (NYISO). 

NYISO Peak Load During the 2024 Summer 

In the examples below, we analyzed the New York Independent System Operator (NYISO)’s peak load hour for each day from June 1, 2024, to August 31, 2024. 

The chart below highlights the three highest peak load days in NYISO, which happened to be consecutive days in July. Yes Energy’s TESLA Demand Forecast outperformed NYISO at the peak on each of these days.

Source: Yes Energy’s TESLA Demand Forecast Solutions

The next chart shows the bid-close demand forecast accuracy statistics for the top 20 days in the summer with the highest daily peak demand. Bid-close forecasts are important because they provide predictions of electricity demand just before the bidding window for the day ahead market closes. Although NYISO only updates their forecast once a day, Yes Energy’s TESLA Demand Forecasts updates new data hourly.

Source: Yes Energy’s TESLA Demand Forecast Solutions

As you can see, Yes Energy’s TESLA Demand Forecast Solutions beat the NYISO forecast more than half the time and had overall smaller megawatt (MW) errors across the entire 20 day period

The chart below shows metrics for the same 20 days as above but focuses on statistics that evaluate each forecast’s accuracy in predicting the timing of the peak demand.

Source: Yes Energy’s TESLA Demand Forecast Solutions

On most days, both forecasts predicted the timing of the peak demand. However, on the three days when the forecasts missed the peak timing, Yes Energy’s TESLA Demand Forecast only missed one day by more than one hour. To put that in context, although the one day when Yes Energy's forecast outperformed NYISO’s accounted for only 5% of the top 20 load days, it represented a 33% advantage within the sample of three days where the ISO and Yes Energy Demand forecast disagreed about the peak hour.

This information is important for battery operators since their battery units typically have a discharge duration of two to four hours, limiting the time they can provide power.

Next, let’s view the top 20 days when NYISO had the largest forecasting errors at the daily peaks.

Source: Yes Energy’s TESLA Demand Forecast Solutions

When the forecasts published by market operators are off by more than usual, traders with access to an alternative forecast have a valuable opportunity to take advantage of volatility and skewed market expectations. 

Utilities and asset managers, meanwhile, can use our solutions to ensure sufficient capacity, prevent outages, and manage costs.

Let’s switch perspectives and consider the performance of both forecasts for the 20 days that Yes Energy’s TESLA Forecast’s errors were highest at the peaks.

Source: Yes Energy’s TESLA Demand Forecast Solutions

When evaluating forecasts, it’s important to assess not only their performance on the most critical or successful days but also to examine their performance at their worst. On Yes Energy’s worst days, we still have lower average errors when looking at root mean squared error (RMSE). Some days will be challenging for all forecasters to predict accurately. That’s why it’s important that a forecast maintain consistently low errors, minimizing the impact of those tough-to-predict days.

More Accurate Peak Load Forecasts  

Making informed decisions amid complex, rapidly changing nodal power markets is a challenge. That’s why Yes Energy's TESLA Demand Forecasting solutions are designed to help you manage risk and gain a competitive edge in your load forecasting.

Our proprietary forecasting engines analyze comprehensive historical demand and weather patterns while incorporating the latest real-time data to adjust for changing weather conditions, extreme events, and holidays that may affect energy demand and prices. 

Ready to learn how we can help you Win the Day Ahead™? Talk to our team about our NYISO load forecasts or request a demo.

About the Author: Ben Perry is the senior product manager of forecasting at Yes Energy. Ben brings 10 years of experience as a power demand forecast analyst at TESLA to the Yes Energy product team. He's now focused on applying that experience to steering the Yes Energy forecasting product roadmap to best serve the industry through the energy transition.