CRR Shortfall – Revenue Equalization Part 2 (Continuation from 2/21/08 TPTF discussion)
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Transcript of CRR Shortfall – Revenue Equalization Part 2 (Continuation from 2/21/08 TPTF discussion)
CRR Shortfall – Revenue Equalization
Part 2 (Continuation from 2/21/08 TPTF discussion)
Bill Barnes
TPTF3/5/2008
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CRR Settlement Revenue - Overview
Day-Ahead CRRs Real-Time PTP Options
Real-Time PTP Obligations
Derate Yes Yes No
Funded by DAM Congestion Rent
RT Congestion Rent or Load (RTRN)
RT Congestion Rent or Load (RTRN)
DA Congestion Rent Shortfall
Shorted Shorted Not Impacted
Excess DA Congestion Rent
Balancing Account
Balancing Account
Not Impacted
RT Congestion Rent Shortfall
Not Impacted Load pays Load pays
Excess RT Congestion Rent
No Impacted Load gets paid Load gets paid
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CRR Settlement Revenue - Overview
• Balancing Account Process – managing CRR revenue adequacy
– Day-Ahead Congestion Rent is compared to total Day-Ahead CRR payments on an hourly basis for the Operating day.
– If excess Day-Ahead Congestion Rent exists compared to Day-Ahead CRR payments for the hour, excess added to Balancing Account.
– If there is not enough Day-Ahead Congestion Rent to cover Day-Ahead CRR payments for the hour, a Day-Ahead shortfall is calculated for the operating day and allocated to DA and RT CRR holders.
– At the end of the month, the total shortfall accumulation for the month is compared to Balancing Account accrual.
• If BA is non-zero, any CRR holders shorted during the month will be made whole up to BA amount.
• Excess funds in Balancing Account after alleviating CRR shorts will be paid to QSEs based on LRS.
– Balancing Account clearing process independent of DAM or RTM invoicing process.
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CRR Settlement Revenue - Shortfall Allocation
• Why do we allocate to the Real-Time?– NP Section 4.5.1 (8)
• “The directional network element flows for PTP Options declared for settlement in Real-Time must be properly accounted for in determining available transmission network capacity in the DAM.”
– Translation: DAM clearing engine will make an economic decision to clear a CRR offer (settled in DAM) or reserve the capacity for Real-Time (settled in RT).
– Since RT CRR capacity is reserved in the DAM, it would not be covered by DAM Congestion Rent.
• Why do we allocate a shortfall of DAM Congestion Rent compared to DAM CRR payments to RT CRR Account Holders?– Equitable treatment of all CRR AHs
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The following slides are from 2/21/2008 TPTF discussion.
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CRR Settlement Revenue - Shortfall
• DACONGRENT + DACRR Charges < DACRR Credits– CRR Shortfall
• Based on revenue shortfall in DAM only
– Shortfall assigned to CRR AHs in DAM and RT– Issue: ERCOT pays out money for DAM that it does not collect
until RT
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CRR Settlement Revenue - Shortfall
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CRR Settlement Revenue - Shortfall
• Solution: NPRR to remove CRR Shortfall partial assignment to RT