CRR Offers in the Day-Ahead Market

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CRR Offers in the Day-Ahead Market
TPTF August 28, 2007Presented by Mark Patterson
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Contents

• CRR offers to DAM
• CRR Offers and Validations
• CRR DAM Clearing and Settlement
• Examples

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CRR offers

• What is the meaning of a CRR offer to DAM?
• Offering a CRR Options/Options with Refund to DAM
  is declaring a CRR Options available to be
  settled in Real-Time
• An valid offer can be either
• Quantity along with a Minimum Reservation Price
• Quantity only (no Minimum Reservation Price)
• If no Minimum Reservation Price is specified
  (quantity only in an offer), 2000/MWh will be
  assigned as a default.
• If no offer is made, the CRR Account Holder will
  be settled at DAM LMPs

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CRR offers

• Who can offer their CRRs into the Day-Ahead
  market?
• Only NOIEs, through their QSE
• Protocol ref 4.3 (1) (b)
• What products can be offered into DAM?
• PTP Options
• PTP Options with Refund
• Products acquired through Allocation or Auction
  may be offered
• Protocol ref 4.4.5 (2) (3)
• Once paid for, PCRR allocations of Capacity type,
  are not differentiated from other PTP Obligations
  or PTP Options awarded via Auction.

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Criteria of CRR Offers

• CRR Offers include the following information
• The name of the QSE submitting
• The name of the CRR Account Holder who owns the
  CRRs
• CRR ID Unique identifier provided by the CRR
  system at the conclusion of each allocation and
  auction
• Source and sink settlement points
• First hour and last hour
• Minimum Reservation Price per MW per hour
• Quantity (MW)
• NOIE peak load forecast for the Operating Day

• Note Nodal Protocols state Minimum
  Reservation Price required but include provision
  for using default value when no price provided
  with Offer

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Validation of CRR Offers

• Key Notes
• If the QSE and CRR Account Holders are separate
  entities, the relationship between the two must
  be formalized through registration.
• The CRR Account Holder is identified as a NOIE.
• The CRR ID will be validated against the CRR
  Ownership information provided on a daily basis
  to the MMS-DAM by the CRR system
• The total Quantity of CRR offers for a NOIE for
  an Operating Hour must not exceed 110 of NOIEs
  peak load forecast of the Operating Day.
  Otherwise, last offer will be rejected.

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Settlement of DAM Results

• After DAM execution,
• If a CRR offer is cleared in DAM, the cleared
  quantity will be settled using DAM LMPs.
• Not cleared CRR offers will be settled by
  Real-Time LMP.

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Example
Source/Sink settlement points A/B
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Example 1

• Joes NOIE CRR Account Holder, owns 100 MW PTP
  Option between PointA and PointB (CRRID 1)
• Joes NOIE QSE offers 100 MW of CRRID 1 into the
  DAM, with a minimum reservation price of 30 /MW
• After DAM clearing, the CRR option clearing price
  for source at PointA and sink at PointB is 40 /
  MW
• After DAM clearing, the LMP difference between
  PointA and PointB is 35 / MW
• All 100 MWs of the offered CRR clears in DAM
• Joes NOIE CRR Account Holder will receive 35 /
  MW for all 100 MW

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Example 2

• Joes NOIE CRR Account Holder, owns 100 MW PTP
  Option between PointA and PointB (CRRID 2)
• Joes NOIE QSE offers 60 MW of CRRID 2 into the
  DAM, with a minimum reservation price of 30 /MW
• After DAM clearing, the CRR option clearing price
  for source at PointA and sink at PointB is 40 /
  MW
• After DAM clearing, the price difference between
  PointA and PointB is 35 / MW
• 60 MWs of the offered CRR clears in DAM
• 40 MWs of the non-offered CRR is paid based on
  DAM LMPs
• Joes NOIE CRR Account Holder will receive 35 /
  MW for all 100 MW

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Example 3

• Joes NOIE CRR Account Holder, owns 100 MW PTP
  Option between PointA and PointB (CRRID 3)
• Joes NOIE QSE offers 60 MW of CRRID 3 into the
  DAM, with a minimum reservation price of 50 /MW
• After DAM clearing, the CRR option clearing price
  for source at PointA and sink at PointB is 40 /
  MW
• After DAM clearing, the price difference between
  PointA and PointB is 35 / MW
• After RT clearing the price difference between
  PointA and PointB is 90 / MW
• 40 MWs of the non-offered CRR is paid based on
  DAM LMPs
• 60 MWs of the offered CRR is not cleared, and
  will flow to RT and be paid based on RT LMPs
• Joes NOIE CRR Account Holder will receive 35
  /MW for 40 MW and 90 / MW for 60 MW

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Example 4

• Joes NOIE CRR Account Holder, owns 100 MW PTP
  Option between PointA and PointB (CRRID 4)
• Joes NOIE QSE offers 100 MW of CRRID 4 into the
  DAM, but does not specify a minimum reservation
  price
• After DAM clearing, the CRR option clearing price
  for source at PointA and sink at PointB is 40 /
  MW
• After DAM clearing, the price difference between
  PointA and PointB is 35 / MW
• After RT clearing the price difference between
  PointA and PointB is 90 / MW
• 100 MWs of the offered CRR is not cleared because
  the default price is 2000 / MW, and will flow to
  RT and be paid based on RT LMPs
• Joes NOIE CRR Account Holder will receive 90
  /MW for 100 MW

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Example 5

• Toms NOIE CRR Account Holder, owns 100 MW PTP
  Option between PointA and PointB (CRRID 5)
• Bills QSE is authorized to represent Toms NOIE
  CRR Account Holder
• Bills QSE offers 100 MW of CRRID 5 into the
  DAM, with a minimum reservation price of 30 /MW
• After DAM clearing, the CRR option clearing price
  for source at PointA and sink at PointB is 40 /
  MW
• After DAM clearing, the price difference between
  PointA and PointB is 35 / MW
• All 100 MWs of the offered CRR clears at DAM
• Toms CRR Account Holder will receive 35 /MW for
  all 100 MW

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Questions?