ERCOT MARKET EDUCATION Basic Training Program · PTP Obligation Awards. Ancillary Service Awards....
Transcript of ERCOT MARKET EDUCATION Basic Training Program · PTP Obligation Awards. Ancillary Service Awards....
ERCOT MARKET EDUCATIONBasic Training Program
Module 3
Day-Ahead Market
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Module Overview
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• Identify the timeline and define the purpose of the Day-Ahead Market.
• List the ERCOT inputs into the Day-Ahead Market.
• Identify the submittal requirements for the Day-Ahead Market offers and bids.
• Identify the submittal requirements for the three types of trades and their impact on Market processes.
• Illustrate the Day-Ahead Market clearing process.
• List the Day-Ahead Market outputs.
• Identify the charges and payments associated with the Day-Ahead Market.
Upon completion of this module, you will be able to:
Module Objectives
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Bids vs. Offers
A Bid is a proposal to buy:
• A Product• At a Location• For a Price
An Offer is a proposal to sell:
• A product• At a Location• For a PriceEnergy
LoadZone 4$40
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Products bought and sold in the DAM:
Day-Ahead Market
Energy Awards
PTP Obligation Awards
Ancillary Service Awards
Energy Bids & Offers
PTP Obligation Bids
Ancillary Service Offers
Co-Optimization
Engine
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What is “co-optimization”?
Day-Ahead Market
Energy Awards
PTP Obligation Awards
Ancillary Service Awards
Co-Optimization
Engine
Energy Bids & Offers
PTP Obligation Bids
Ancillary Service Offers
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What is “co-optimization”?
Day-Ahead Market
Energy Awards
PTP Obligation Awards
Ancillary Service Awards
Co-Optimization
Engine
Energy Bids & Offers
PTP Obligation Bids
Ancillary Service Offers
Cleared Offers = Costs
Cleared Bids = Revenues
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What is “co-optimization”?
Day-Ahead Market
MaximizeThe Gap
Bid-based Revenues
Offer-based Costs
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What is “co-optimization”?
Day-Ahead Market
Bid-based Revenues
Energy Costs &Ancillary Service Costs
MaximizeThe Gap
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Results of Co-optimization:
Day-Ahead Market
Energy Awards
PTP Obligation Awards
Ancillary Service Awards
Energy Bids & Offers
PTP Obligation Bids
Ancillary Service Offers
Co-Optimization
Engine
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Participation in the DAM is Voluntary & Financially Binding
Day-Ahead Market
Energy Awards
PTP Obligation Awards
Ancillary Service Awards
Co-Optimization
Engine
Energy Bids & Offers
PTP Obligation Bids
Ancillary Service Offers
Some exceptions:
• QSEs with load are always financially obligated for Ancillary Services
• Awarded Ancillary Services physically binding
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In the Day-Ahead Market, the actions of one Market Participant have a financial impact on the other.
Day-Ahead Market: Impacts
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Day-Ahead Market: Impacts
Financial Impacts:
• Energy & Congestion Revenue Rights (CRRs)• Ancillary Service Awards
Reliability Impacts:
• Ancillary Services
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Day-Ahead Market Activities Overview
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy• Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
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Activity Timeline – 0600
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy• Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
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Activity Timeline – 1000
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy• Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
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Activity Timeline – 1330
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy• Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
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• ERCOT must publish Ancillary Service Obligations
ERCOT Activities that occur by 6 a.m.
ERCOT Activities – Ancillary Services
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The required quantity in MW of each Ancillary Service for each hour of the Operating Day ERCOT-wide
• Developed by ERCOT
• Posted to MIS Public Area by 0600
Ancillary Service (AS) Plan
Ancillary Service Plan
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• AS Plan quantities are assigned to LSEs based on Load Ratio Shares
• Assignments are made by service, by hour
Ancillary Service (AS) Plan
Ancillary Service Plan
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• AS quantities are then aggregated to the QSE Level by service, by hour
• Posted to MIS Certified Area by 0600 of the Operating Day
Ancillary Service (AS) Obligation
Ancillary Service Plan
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• Self-Arrange to have Resources provide AS
• Allow ERCOT to purchase AS in the Day-Ahead Market
How can a QSE meet Ancillary Service (AS) Obligations?
Ancillary Service Obligations
ERCOTSelf-Arrange
DAM
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The net amount of Ancillary Service capacity that the QSE is obligated to deliver to ERCOT, by hour and service type, from Resources represented by the QSE.
Ancillary Service (AS) Supply Responsibility
Ancillary Service Supply Responsibility
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Ancillary Service (AS) Supply Responsibility
Ancillary Service Supply Responsibility
Self-Arranged AS Quantities+ AS Trades in which the QSE is the Seller+ Awarded AS Offers– AS Trades where the QSE is the Buyer
= Ancillary Service Supply Responsibility
Calculation
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The AS Resource Responsibility indicates which of the QSE’s Resources will be obligated to provide the AS Supply Responsibility in Real-Time.
Ancillary Service (AS) Resource Responsibility
Ancillary Service Resource Responsibility
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• Communicated through Current Operating Plan (COP)
Identifies:
• Hour(s) Resource will be providing AS• Type of AS• Amount (MW) of AS
Ancillary Service (AS) Resource Responsibility
Ancillary Service Resource Responsibility
QSE’s AS Resource Responsibility must be arranged by 1430 Day-Ahead:
• After DAM• Before DRUC
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Ancillary Service – Scenario
• ERCOT assigns part of the AS Plan quantity, by service, by hour, to each LSE based on its Load Ratio Share of seven days ago.
• The ERCOT load for the hour we are using in our example is 50,000 MW.
ERCOT Load
50,000 MW
Scenario
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• ERCOT uses each LSE’s Adjusted Metered Load to determine Load Ratio Share
Two LSEs:
Ancillary Service
Adjusted Metered Load
LSE “Lazy P” Load= 1000 MW
LSE “Diamond Bar” Load = 1500 MW
P
Scenario
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Load Ratio Share Calculation:
Ancillary Service
Load Ratio Share =
(LSE ) 1000 MW / 50,000 MW = 2%
(LSE ) 1500 MW / 50,000 MW = 3%
P
Adjusted Metered Load
LSE “Lazy P” 2%
LSE “Diamond Bar” 3%
P
Scenario
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• QSE 1 Load Ratio Share is sum of both LSEs Load Ratio Shares
• ERCOT will use QSE 1’s Load Ratio Share to determine
Ancillary Service Obligation for each service, each hour of Operating Day
QSE 1 represents both LSEs
Ancillary Service
Load Ratio Share of QSE 1:
(LSE ) 2% + (LSE ) 3% = 5%P
Scenario
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• Publish system conditions
Other ERCOT activities by 6 a.m.
ERCOT Activities – Publishing
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System Conditions posted by ERCOT to MIS:
Publishing
ERCOT Posts… For
Weather assumptions Forecasting system conditions and Dynamic Ratings Processor
ERCOT System, Weather Zone, and Load Zone forecasts Next seven days, by hour
Load forecast distribution factors MPs to estimate Load at the Bus level
Settlement Points List and Electrical Buses Mapping
Current list of Settlement Points that may be used in market processes and transactions
List of active Transmission constraints Indication of likely binding constraints
Forecasted Load Profiles Non-IDR metered customers
Forecasted Distribution Loss Factors and Transmission Loss Factors Each Settlement Interval
Network Operations Model topology* Each hour of the Operating Day
*Available on MIS Secure
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Next, let’s discuss QSE Activities:
QSE Activities Overview
Report Trades • Submit DC Tie Schedules
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy• Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
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QSE Activities Overview
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy • Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
QSE
Act
ivity
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Report Trades • Submit DC Tie Schedules
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QSE Activities: Report Availability of RMR & Black Start Resources
Availability of RMR and Black Start Resources
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy • Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
QSE
Act
ivity
0600 14301000
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QSE Activities: Submit Bids for PTP Obligations
QSE Activities – PTP Obligations
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy • Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
QSE
Act
ivity
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• Financial instruments
Hedge against congestion costs Financial Investment
• Purchased at DAM price spread
• Settled at Real-Time price spread
Day-Ahead Market PTP Obligations
PTP Obligations
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QSE Activities: Submit Three-Part Supply Offers
QSE Activities – Energy Bids and Offers
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy • Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
QSE
Act
ivity
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An offer to sell energy for a specific Generation Resource that a QSE represents.
It is used in
• The Day-Ahead Market• The Reliability Unit Commitment process• Real-Time
Three-Part Supply Offer
Three-Part Supply Offer
1 2 3
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Cost of starting up a resource and reaching Low Sustained Limit (LSL) in dollars per start
What is a Startup Offer?
Three-Part Supply Offer
1 2 3
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Costs incurred by a Resource in producing energy at Low Sustained Limit (LSL).
What is a Minimum-Energy Offer?
Three-Part Supply Offer
1 2 3
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These two offers can only be submitted as part of a Three-Part Supply Offer.
Startup & Minimum-Energy Offers
Three-Part Supply Offer
1 2 3
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A QSE’s offer to sell energy at, or above a certain price and at a certain quantity (above Low Sustained Limit)
What is an Energy Offer Curve?
Three-Part Supply Offer
1 2 3
A QSE may submit just an Energy Offer Curve, independent of
Startup & Minimum Energy Offers
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• Operating Day
• Resource name
• The expiration time and date of the offer
• Inclusive or exclusive designation relative to DAM Ancillary Service offers from the same Resource
• A monotonically increasing offer curve
• Percentage of Fuel Index Price (FIP) and Fuel Oil Price (FOP) for generation above LSL
To submit an Energy Offer Curve, include:
Three-Part Supply Offer
3
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• Operating Day
• Resource name
• The expiration time and date of the offer
• Inclusive or exclusive designation relative to DAM Ancillary Service offers from the same Resource
• A monotonically increasing offer curve
• Percentage of Fuel Index Price (FIP) and Fuel Oil Price (FOP) for generation above LSL
To submit an Energy Offer Curve, include:
Three-Part Supply Offer
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Energy Offer Curve is..
• Submitted using price/quantity pairs• Monotonically increasing offer curve• Limited to no more than 10 price/quantity pairs
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• Operating Day
• Resource name
• The expiration time and date of the offer
• Inclusive or exclusive designation relative to DAM Ancillary Service offers from the same Resource
• A monotonically increasing offer curve
• Percentage of Fuel Index Price (FIP) and Fuel Oil Price (FOP) for generation above LSL
To submit an Energy Offer Curve, include:
Three-Part Supply Offer
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Energy Offer Curve range:
• Prices must be between -$250/ MWh and System-Wide Offer Cap
• Minimum quantity of offer is one MW
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• Must submit all the same criteria as Energy Offer Curve
• Add information that relates to:
Startup Offer & Minimum Energy Offer
Submitting a Three-Part Supply Offer:
Three-Part Supply Offer
1 2 3
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• Operating Day
• Resource name
• The expiration time and date of the offer
• Inclusive or exclusive designation relative to DAM Ancillary Service offers from the same Resource
• A monotonically increasing offer curve
• Percentage of Fuel Index Price (FIP) and Fuel Oil Price (FOP) for generation above LSL
• Hot, intermediate, and cold Startup Offers ($)
To submit a Three-Part Supply Offer, include:
Three-Part Supply Offer
1
2
3
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• Operating Day
• Resource name
• The expiration time and date of the offer
• Inclusive or exclusive designation relative to DAM Ancillary Service offers from the same Resource
• A monotonically increasing offer curve
• Percentage of Fuel Index Price (FIP) and Fuel Oil Price (FOP) for generation above LSL
• Hot, intermediate, and cold Startup Offers ($)
• Minimum-Energy Offer ($/MWh)
To submit a Three-Part Supply Offer, include:
Three-Part Supply Offer
1
2
3
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• Offers must be ≤ 200% of Generic Costs
• QSE must submit percentages of Fuel Index Price (FIP) and Fuel Oil Price (FOP) at LSL to determine Generic Minimum Energy Cost
Start Up and Minimum Energy Offers Caps:
Three-Part Supply Offer
1 2 3
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• QSE may submit verifiable cost data for actual Startup & Minimum-Energy cost
• Then, offers must be ≤ 200% of approved Verifiable Costs
Start Up and Minimum Energy Offers Caps:
Three-Part Supply Offer
1 2 3
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How are the Three Parts used?
Three-Part Supply Offer
Three-Part Supply Offer
StartupOffer
MinimumEnergyOffer
EnergyOfferCurve
Day-Ahead Market
RUC-Commitment
Real-Time Dispatch
1 2 3
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QSE Activities: Submit Energy Bids & Energy-Only Offers
QSE Activities – Energy Bids and Offers
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy • Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
QSE
Act
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What’s the difference?
Energy Bids & Energy-Only Offers
DAM Energy Bid:
Is a QSE’s willingness to buy energy:
At or below a certain price
At a certain quantity
At a specific Settlement Point in the DAM.
DAM Energy-Only Offer:
• Is a QSE’s willingness to sell energy:
At or above a certain price
At a certain quantity
At a specific Settlement Point in the DAM.
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• Energy-Only Offers are NOT resource-specific
• QSE does not have to own Resources to offer energy
Energy-Only Offers
Energy Bids & Energy-Only Offers
In the Day-Ahead Market, the QSE is paid for the energy at DAM Settlement
Point Prices
In Real-Time, the QSE is charged for the energy at Real-
Time Settlement Point Prices
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• Proposal to buy energy
• At a specified settlement point
• At or below a specified price
Energy Bids
Energy Bids & Energy-Only Offers
QSEs with Awarded Energy Bids are
charged the DAM Settlement Point
Price
In Real-Time, the QSE is paid the Real-TimeSettlement Point Price
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QSE must indicate:
• Operating Day
• The Settlement Point
• The expiration time and date of the offer or bid
• Price and quantity for each hour of the offer or bid
• Whether Offer or Bid is fixed quantity, variable quantity, or curve
DAM Energy-Only Offer or Energy Bid
Submittal Criteria
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QSE must indicate:
• Operating Day
• The Settlement Point
• The expiration time and date of the offer or bid
• Price and quantity for each hour of the offer or bid
• Whether Offer or Bid is fixed quantity, variable quantity, or curve
DAM Energy-Only Offer or Energy Bid
Submittal Criteria
Day-Ahead Market Energy-Only Offers:
• Price range must be between -$250.00 and System Wide Offer Cap
• Minimum offer = 1 MW
Day-Ahead Market Energy Bids
• Minimum bid = 1 MW
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• Fixed Quantity
• Variable Quantity
Single Price/Quantity Pair
Energy-Only Offer and Bid Types
Fixed Quantity Variable Quantity
$ / M
Wh
MW
$ / M
Wh
MW
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• Offers - Monotonically increasing
• Bids - Monotonically decreasing
Curve with up to 10 Price/Quantity Pairs
Energy-Only Offer and Bid Types
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• Optionally, a QSE may structure the bid or offer as a multi-hour block
Multi-hour Block Indicator
Energy-Only Offer and Bid Multi-hour Block
Fixed Quantity Block Variable Quantity Block
Multi-hour block is not an option for Curve type
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• Fixed Quantity Multi-hour Block:
Bids 10 MW at $50/MWh for HE 0700-2200.
Single price, single quantity for all hours in the block
Scenario:
Fixed vs. Variable Multi-hour Blocks
Fixed Variable
Hours: 0700-2200 0700-2200
MW: 10 Up to 10
$/MWh: $50.00 $50.00
Fixed – Must clear all MWs for all hours or none Variable – Must clear all hours or none
Scenario
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• Variable Quantity Multi-hour Block:
Bids 10 MW at $50/MWh for HE 0700-2200.
Single price, single “up to” quantity contingent on the purchase of all hours in the block
Scenario:
Fixed vs. Variable Multi-hour Blocks
Fixed Variable
Hours: 0700-2200 0700-2200
MW: 10 Up to 10
$/MWh: $50.00 $50.00
Fixed – Must clear all MWs for all hours or none Variable – Must clear all hours or none
Scenario
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• ERCOT will notify the QSE submitting via the Messaging System
• The QSE can then resubmit the offer or bid within appropriate market timeline
If an offer or bid is rejected or invalid:
Validation
If an offer or bid is accepted:
ERCOT will continuously validate offers and bids and continuously display on the MIS Certified Area information that allows any QSE to view its valid offers and bids.
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QSE Activities: Submit Self-Arranged AS
QSE Activities – Self-Arranged Ancillary Services
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy • Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
QSE
Act
ivity
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• All or part by Ancillary Service by hour• Must submit Self-Arranged AS Quantities by 10:00
Impact:
Reduces the amount of each Ancillary Service that ERCOT procures on behalf of the QSE
A QSE may self-arrange its AS Obligations:
Self-Arranged AS Overview
This provision applies to both DAM and SASMs.
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Options for self-arranged Ancillary Services
Self-Arranged AS Overview
Using own Resources
Through AS trades
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• Limited to -500 MW for each Ancillary Service• Limited in magnitude to net Ancillary Service Trades
Impact:
ERCOT procures extra AS Quantities in DAM on behalf of the QSE.
A QSE may submit negative Self-Arranged AS Quantities:
Self-Arranged AS Overview
This provision applies only to DAM; not allowed
in SASMs.
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• Up to100 MW for Responsive and Non-Spin Reserve• Up to 25 MW for Regulation Up and Down• Self-arranged quantity from QSE’s own Resources may not
exceed AS Obligation
Impact:
QSEs are paid for the extra Ancillary Services they provide
A QSE may self-arrange more than its AS Obligations:
Self-Arranged AS Overview
This provision applies to both DAM and SASMs.
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• QSE self-arranges portion of AS• ERCOT must procure AS in DAM
For Hour Ending 7:
Self-Arranged AS
Type of AS QSE 1 Obligations
Self-Arranged Hour = 6
Self-ArrangedHour = 7
ERCOT Must Procure in
DAM Hour = 7
Reg Up 50 MW 50 MW 50 MW 0 MW
Reg Down 25 MW 25 MW 15 MW 10 MW
Responsive Reserve 115 MW 115 MW 75 MW 40 MW
Non-Spin 60 MW 60 MW 60 MW 0 MW
Scenario
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• Supplied using own Resources
Update Current Operating Plan
• Supplied through AS Trades
Submit trades through the MIS
By 1430, QSE must notify ERCOT how Self-Arranged Ancillary Service quantities will be supplied
Self-Arranged AS Overview
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QSE Activities: Submit Ancillary Service Offers
QSE Activities – Ancillary Service Offers
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy • Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
QSE
Act
ivity
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• Offers into the Day-Ahead Market to provide Ancillary Service capacity, made by QSEs
What are Ancillary Service Offers?
Ancillary Service Offers
Reliability Impact
• Additional capacity offered into the DAM allows ERCOT to cover all of its AS Plan
Financial Impact
• QSE receives payment for awarded Offer
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Ancillary Service Offers can be entered as inclusive or exclusive of Energy Offers
Ancillary Service Offers – Inclusive / Exclusive
AND/OR
Type of AS Offer
Reg Up MW
Reg Down MW
Responsive Reserve MW
Non-Spin MW
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• Inclusive offers
Ancillary Services and/or Energy Offer can be awarded
• Exclusive offers
Either Energy or Ancillary Services can be awarded, but not both
Inclusive and Exclusive offers for Energy and AS
Ancillary Service Offers – Inclusive / Exclusive
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• 100 MW of either energy or AS
Inclusive and Exclusive offers for Energy and AS:
Ancillary Service Offers – Inclusive / Exclusive
RESULT:
• QSE’s Reg Up and Responsive Reserve offers are awarded – 30 MW
• The DAM will not award the Resource’s Energy Offer Curve for the same hour
ExclusiveOffer
Resource Total Available Capacity
100 MW
Reg Up 10 MW
Reg Down 15 MW
Responsive Reserve 20 MW
Non-Spin(On-Line) 60 MW
Non-Spin(Off-Line) 100 MW
OR
Scenario
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• Total of 100 MW available
Inclusive and Exclusive offers for Energy and AS
Ancillary Service Offers – Inclusive / Exclusive
RESULT:
• QSE’s Reg Up and Responsive Reserve offers are awarded – 30 MW
• The DAM may award up to 70 MWs of the Resource’s Energy Offer Curve for the same hour
ExclusiveOffer
Inclusive Offer
Resource Total Available Capacity
100 MW 100 MW
Reg Up 10 MW 10 MW
Reg Down 15 MW 15 MW
Responsive Reserve 20 MW 20 MW
Non-Spin(On-Line) 60 MW 60 MW
Non-Spin(Off-Line) 100 MW 100 MW
ANDOR
Scenario
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• DAM assumes the Resource is Off-Line
• Resource can only be awarded AS if the Three-Part Supply Offer is also awarded
• The total capacity awarded must be within the Resource’s total capacity limits as specified in the COP
AS Offer linked to a Three-Part Supply Offer:
Linked Ancillary Service Offers
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• DAM assumes the Resource is Off-Line
• Resource can only be awarded AS if the Three-Part Supply Offer is also awarded
• The total capacity awarded must be within the Resource’s total capacity limits as specified in the COP
AS Offer linked to a Three-Part Supply Offer:
Linked Ancillary Service Offers
If an Exclusive Energy Offer is part of a Three-Part Supply Offer, the DAM must award energy up to LSL in order to award on-line
Ancillary Services.
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• DAM assumes the Resource is On-Line
• The total capacity awarded must be within the Resource’s total capacity limits as specified in the COP
AS Offer linked to other AS Offers or Energy Offer Curve:
Linked Ancillary Service Offers
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• Operating Day
To submit an AS Offer, a QSE must include:
Submittal Criteria for AS Offers
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• Operating Day
• The Resource
To submit an AS Offer, a QSE must include:
Submittal Criteria for AS Offers
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• Operating Day
• The Resource
• Quantity of MWs offered, and price for each AS type being offered from this same capacity
To submit an AS Offer, a QSE must include:
Submittal Criteria for AS Offers
Type of AS Offer
Reg Up MW
Reg Down MW
Responsive Reserve MW
Non-Spin MW
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• Operating Day
• The Resource
• Quantity of MWs offered, and price for each AS type being offered from this same capacity
• The expiration time and date of the offer
To submit an AS Offer, a QSE must include:
Submittal Criteria for AS Offers
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• Operating Day
• The Resource
• Quantity of MWs offered, and price for each AS type being offered from this same capacity
• The expiration time and date of the offer
• Fixed or variable quantity indicator
To submit an AS Offer, a QSE must include:
Submittal Criteria for AS Offers
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• Can be offered only by a Load Resource
• Single price ($/MW) and single quantity (MW)
• Cannot exceed 150 MW
Fixed Quantity Ancillary Service Offer:
Submittal Criteria for AS Offers
Fixed Variable
Hours: 0700-2200 0700-2200
MW: 10 Up to 10
$/MW: $15.00 $15.00
Can be multi-hour block
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• Can be offered by Generation or Load Resource
• Single price ($/MW) and single “up to” quantity (MW)
Variable Quantity Ancillary Service Offer:
Submittal Criteria for AS Offers
Fixed Variable
Hours: 0700-2200 0700-2200
MW: 10 Up to 10
$/MW: $15.00 $15.00
Can be multi-hour block
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• Price must be between $0 and the System Wide Offer Cap
• The minimum offer amount for each AS product is 0.1 MW
• A single Resource may submit offers for more than one AS
Ancillary Service Offer Limits:
Submittal Criteria for AS Offers
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• ERCOT will notify the QSE submitting an AS Offer
• The QSE can then resubmit the offer within the appropriate market timeline
If an offer is accepted:
• ERCOT will continuously validate AS Offers and continuously display on the MIS Certified Area information that allows any QSE named in an AS Offer to view its confirmed AS Offers.
If an offer is rejected or invalid:
Validation
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QSE Activities: Update & Submit Current Operating Plan
QSE Activities – Current Operating Plan
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy • Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
QSE
Act
ivity
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• A plan by a QSE reflecting anticipated operating conditions
• Provides accurate information about Resources from a planning perspective
What is a Current Operating Plan (COP)?
Current Operating Plan Overview
COP Business Practice Manual:
http://www.ercot.com/mktrules/bpm/index.html
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• Day-Ahead Market
• Reliability Unit Commitment
The COP Provides Input into:
Current Operating Plan Overview
The COP is not used in Real-Time Operations.
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• COPs include operating conditions for each Resource, for each hour in the next seven Operating Days
Timeframe Criteria:
Current Operating Plan Overview
• COPs may be modified up to the end of the Adjustment Period for each Resource
• A QSE has 60 minutes after an event to modify or update its COP to reflect changes in availability of a Resource
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Any QSE representing a Resource is obligated to submit a Current Operating Plan (COP) for each Resource.
To submit a COP, a QSE must include:
• The Name of the Resource
• Expected Resource Status
• Low/High Sustained Limit (LSL / HSL)
• Low/High Emergency Limit
• Capacity for Ancillary Service Types
Submittal Criteria for COP
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• Combined Cycle Generation Resources (CCGRs)
• Wind-Powered Generation Resources (WGRs)
• Photovoltaic Generation Resources (PVGRs)
Three types of Resources have special submittal criteria
Submittal Criteria for COP
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• A registered configuration of a Combined Cycle Train
• Offered as a single Resource
Combined Cycle Generation Resource (CCGR):
Submittal Criteria for COP
CCGR 1
Combined Cycle Train
ST1 GT1 GT2 GT3
CCGR 2
CCGR 3
QSE must submit a COP for each registered CCGR
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COP HSL must be less than or equal to the Short-Term Wind Power Forecast for that Resource provided by ERCOT.
Photovoltaic Generation Resource (PVGR):
COP HSL must be less than or equal to the Short-Term Photovoltaic Power Forecast (STPPF) for that Resource provided by ERCOT.
Wind-Powered Generation Resource (WGR):
Submittal Criteria for COP
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• ERCOT will notify the QSE submitting the COP
• The QSE must then resubmit the COP as soon as possible
If a COP is found to be invalid:
Validation
100
• The COP must identify sufficient Resource capacity to fulfill Ancillary Service Supply Responsibility.
• ERCOT will notify a QSE if the sum of the AS capacity designated in the COP for each hour, by service type is less than the QSE's AS Supply Responsibility for each service type for that hour.
COPs and Ancillary Services (AS):
Validation
QSEs must correct deficiencies in their COP within one hour after
being notified by ERCOT
101
QSE Activities: Report Trades
QSE Activities – Trade Reporting
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy • Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
QSE
Act
ivity
0600 14301000
Report Trades • Submit DC Tie Schedules
102
• Transactions between QSEs
Types of Trades:
• Energy Trades
• Capacity Trades
• Ancillary Service Trades
What are Trades?
Trade Reporting Overview
103
A QSE-to-QSE transaction that transfers financial responsibility for energy at a Settlement Point between a buyer and a seller.
An Energy Trade is …
Trade Reporting Overview
104
A QSE-to-QSE transaction that transfers financial responsibility for capacity between a buyer and a seller.
A Capacity Trade is …
Trade Reporting Overview
105
A QSE-to-QSE transaction that transfers an obligation to provide Ancillary Service capacity between a buyer and a seller.
An Ancillary Service Trade is …
Trade Reporting Overview
106
Submittal Criteria by Trade
Submittal Criteria - Trades
Information Needed Energy Trade Capacity Trade AS Trade
Buying QSE
Selling QSE
Type of AS:
Settlement Point:
MW quantity for each Settlement Interval 15 minute Hourly Hourly
107
• A Trade must be confirmed by both the buyer and the seller through the MIS Certified Area before it can be validated by ERCOT.
• ERCOT validates the trade by
Reviewing the submitted information and ensuring that all the necessary criteria are indicated
Checking to see if both the buyer and seller confirmed the trade
Trade Validation:
Validation
108
• The QSE that reports the Trade to ERCOT is considered to have confirmed the Trade
• The QSE that reports a Trade may reject, edit, or delete it if the Trade has not been confirmed by its counterparty.
• After both the buyer and seller have confirmed a Trade, either party may reject it if the deadline for doing so has not passed.
QSE Responsibilities:
Validation (continued)
109
• ERCOT will notify the QSE submitting a Trade
• The QSE can then resubmit the trade within the appropriate market timeline
If a Trade is rejected or invalid:
Validation (continued)
110
• ERCOT will continuously validate Trades
• ERCOT will continuously display on the MIS Certified Area information that allows any QSE named in a Trade to view confirmed and unconfirmed Trades.
If a Trade is accepted:
Validation (continued)
111
Submittal Criteria – Deadlines
Submitted prior to 1430
Capacity & Energy Trades:
• Create a supply for the buyer in the Day-Ahead Reliability Unit Commitment (DRUC) process
• Create an obligation for the seller in the DRUC process
Submitted after 1430
Capacity & Energy Trades:
• Create a supply for the buyer in subsequent Hourly Reliability Unit Commitment (HRUC) processes
• Create an obligation for the seller in subsequent HRUC processes
112
QSE Activities: Submit DC Tie Schedules
QSE Activities – Trade Reporting
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy • Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
QSE
Act
ivity
0600 14301000
Report Trades • Submit DC Tie Schedules
113
Any non-synchronous transmission interconnection between ERCOT and a non-ERCOT electric power system
A DC Tie is…
DC Tie Scheduling
ERCOT
Non-ERCOT
114
• An energy schedule between ERCOT and a non-ERCOT Control Area
• Submitted by a QSE through OATI*
• Represented by an e-Tag
A DC Tie Schedule is…
DC Tie Scheduling
* Open Access Technology International, Inc.
DC Tie Schedules must follow guidelines
established by NERC, CFE and the ERCOT Protocols.
115
• QSE or non-ERCOT Control Area buying the energy
• QSE or non-ERCOT Control Area selling the energy
Each DC Tie Schedule e-Tag must include:
Submittal Criteria
• DC Tie Settlement Point
• MW for each 15-minute Settlement Interval
• First and Last 15-minute Settlement Interval
• The e-Tag name
116
• All entities with approval rights approve the e-Tag
• No entities with approval rights deny the e-Tag within the approval time window.
An e-tag for a DC Tie Schedule is approved if:
Approval
117
• If a QSE is an Importer into ERCOT through a DC Tie in a Settlement Interval, the DC Tie schedule is settled as a Resource at the DC-Tie Settlement Point
Importing:
DC Tie Settlement
118
• If a QSE is an Exporter out of ERCOT through a DC Tie in a Settlement Interval, the DC Tie schedule is settled as a Load at the DC-Tie Settlement Point
Exporting:
DC Tie Settlement
When the QSE exports through a DC Tie, the QSE is responsible for all load
related charges.
119
• Net Energy Schedule is an Import
• COP updated for net Import
ERCOT maintains a COP for all DC Ties
Importing
Import ExportQSE 1 50QSE 2 35QSE 3 15
North = 220 MW
Net Total: +70
Scenario
120
• Net Energy Schedule is an Export
• COP updated to show DC Tie Resource as an Off-Line Resource
ERCOT maintains a COP for all DC Ties
Exporting
Import ExportQSE 1 5QSE 2 20QSE 3 35
Eagle Pass = 36 MW
Net Total: -10
Scenario
121
DC Tie Schedule Deadlines
Submitted prior to 1430
Import
• Creates a capacity supply for the QSE in the Day-Ahead Reliability Unit Commitment (DRUC) process
Export
• Creates a capacity obligation for the QSE in the DRUC process
Submitted after 1430
Import
• Creates a capacity supply for the QSE in any subsequent Hourly Reliability Unit Commitment (HRUC) process
Export
• Creates a capacity obligation for the QSE in any subsequent HRUC process
122
At 10:00, ERCOT executes the DAM clearing process
ERCOT Activities – DAM Clearing Process
123
Economically & simultaneously clears Offers and Bids
At 1000, ERCOT executes the DAM clearing process:
DAM Clearing Process
Energy Offers & Bids
Ancillary Service Offers & Self-Arranged Qtys
PTP Obligation Bids
Awarded Energy Offers & Bids
Awarded PTP Obligation Bids
Awarded Ancillary Service
Offers
Day-AheadMarket
124
• Transmission constraints
• Resource constraints
• Linked Offer constraints
• Block Offer and Bid constraints
Security constraints include:
DAM Clearing Process
125
• Map out the location of load • Indicate where power flows in
the system
During DAM, ERCOT will:
• Allocate bids and offers at a Load Zone to Electrical Buses based on Load Distribution Factors
Impact
• LMPs• Congestion Costs
Load Distribution Factors
DAM Clearing Process
126
DAM Bids: 10,000 MW
DAM Clearing Process
Bus C0%
Bus A2500 MW
25%
Bus B6000 MW
60%
Bus D1500 MW
15%
Load Distribution Factors for DAM are chosen based on “cold,” “mild,” or “hot”
proxy days.
Scenario
127
• Provided in the ERCOT Protocols • Specified for each Hub
During DAM ERCOT will:
• Allocate bids and offers at a Hub to Electrical Buses based on Hub Distribution Factors
Impact
• LMPs• Congestion Costs
Distribution Factors for Hubs
DAM Clearing Process
Hub
Hub
Hub
Hub
128
The Day-Ahead Market produces a Co-optimized solution
DAM Clearing Process
Energy Offers & Bids
Ancillary Service Offers & Self-Arranged Qtys
PTP Obligation Bids
Awarded Energy Offers & Bids
Awarded PTP Obligation Bids
Awarded Ancillary Service
Offers
Day-AheadMarket
Scenario
129
• 1 MW of Regulation Up (RegUp) and;
• 1 MW of Responsive Reserves (RRS)
For HE 1300 ERCOT needs to procure:
DAM Co-optimization
Bids OffersMW Energy MW Energy RegUp RRS
QSE A 2 $25.00 $10.00 $5.00QSE B 2 $30.00 $11.00 $9.00QSE C 1 $50.00
Three QSEs submitted Offers and Bids as follows:
Scenario
130
Day-Ahead Market Objective:
DAM Co-optimization
Bid-based Revenues Offer-based Costs
Offer-based Costs: Sum [Offer Price * Cleared Offer Quantity]
Bid-based Revenues: Sum [Bid Price * Cleared Bid Quantity]
Maximize [Bid-based Revenues - Offer-based Costs]
In this step, DAM uses Bid Prices and Offer Prices, not clearing prices
Scenario
131
DAM Co-optimization
Energy RegUp RRS
QSE A $25.00 $10.00QSE B $9.00
Energy RegUp RRS
QSE A $25.00 $5.00QSE B $11.00
Energy RegUp RRS
QSE A $10.00 $5.00QSE B $30.00
Bid-based Revenues – Offer-based
Costs
$50 – $25 – $10 – $9 = $6
Case 1
Case 2
Case 3
Bid-based Revenues – Offer-based
Costs
$50 – $25 – $11 – $5 = $9
Bid-based Revenues – Offer-based
Costs
$50 – $30 – $10 – $5 = $5
Scenario
132
• Cost of additional increment of Demand
• How would Day-Ahead Market clear additional MW?
Energy Price
DAM Co-optimization
Energy RegUp RRS
QSE A $25.00 $5.00QSE B $11.00
Offers AwardedOffers ProvidedMW Energy RegUp RRS
QSE A 2 $25.00 $10.00 $5.00QSE B 2 $30.00 $11.00 $9.00
Scenario
133
DAM Co-optimization
Energy RegUp RRS
QSE A 1MW @$25.00 $5.00QSE B 1MW @$30.00 $11.00
Clearing Additional MW of Energy
Offers MW Energy RegUp RRS
QSE A 2 $25.00 $10.00 $5.00QSE B 2 $30.00 $11.00 $9.00
Increases cost by $30
Energy RegUp RRS
QSE A 2MW @$25.00QSE B $11.00 $9.00
Increases cost by $29
Energy Price is $29
Scenario
134
DAM Co-optimization
Clearing Additional Ancillary Services
Offers MW Energy RegUp RRS
QSE A 2 $25.00 $10.00 $5.00QSE B 2 $30.00 $11.00 $9.00
Energy RegUp RRS
QSE A $25.00 1 MW @ $5.00QSE B $11.00 1 MW @ $9.00
Responsive Reserve Price is $9
Energy RegUp RRS
QSE A $25.00 $5.00QSE B 2 MW @ $11.00
Regulation Up Price is $11
Scenario
135
Three QSEs submitted Offers and Bids as follows:
In summary . . .
DAM Co-optimization
QSE A sells 1MW of Energy @ LMP of $29 and 1MW of RRS @ MCPC of $9
QSE B sells 1MW of RegUp @ MCPC of $11
QSE C buys 1MW of Energy @ LMP of $29
Bids OffersMW Energy MW Energy RegUp RRS
QSE A 2 $25.00 $10.00 $5.00QSE B 2 $30.00 $11.00 $9.00QSE C 1 $50.00
Scenario
136
After DAM solves, ERCOT communicates Awards
DAM Clearing Process
Energy Offers & Bids
Ancillary Service Offers & Self-Arranged Qtys
PTP Obligation Bids
Awarded Energy Offers & Bids
Awarded PTP Obligation Bids
Awarded Ancillary Service
Offers
Day-AheadMarket
137
• DAM and AS Capacity awards
ERCOT Activities that occur by 1:30 p.m.
ERCOT Activities – DAM Clearing Process
Awards communicated
by 1330
138
DAM Awards
By 1330, ERCOT Awards… From …
Energy Sales Three-Part Supply Offers & Energy Offer Curves
Energy Sales DAM Energy-Only Offers
Energy Purchases DAM Energy Bids
PTP Obligations PTP Obligation Bids
Ancillary Services Ancillary Service Offers
139
• Day-Ahead Settlement Point Prices by Settlement Point
• Day-Ahead LMPs for each Electrical Bus
• Energy bought and sold in DAM by Settlement Point
• PTP Obligations cleared in DAM by Settlement Point
• Ancillary Services
Day-Ahead MCPC for each type of AS
Quantity of AS Offers received in DAM (MW)
Aggregated AS Offer Curve of all AS Offersfor each type of AS
ERCOT postings for each hour:
DAM Results - Postings
140
• ERCOT monitors Market for errors:
Day-Ahead MCPCs Hourly LMPs
• ERCOT “Flags” questionable prices before posting
Finalized Day-Ahead Market Prices
Postings – Finalized Market Prices
DAM Prices are final at 10:00 on the second
Business Day after the Operating Day.
141
Summary of DAM Activities
Submit:• Availability of
RMR and Black Start Resources
Submit:• Bids for PTP Obligations• Bids & Offers for Energy• Self-Arranged AS Quantities• AS Offers
Update & Submit:• COP
Day-Ahead Market Financial Impacts
143
Let’s discuss the settlement of Day-Ahead awards
Day-Ahead Settlements
Energy Awards
PTP Obligation Awards
Ancillary Service Awards
Energy Bids & Offers
PTP Obligation Bids
Ancillary Service Offers
Co-Optimization
Engine
144
Overview
Day-Ahead Settlements
Energy Awards
PTP Obligation Awards
Ancillary Service Awards
Settlements for purchase of PTP Obligation Bids
• Settled hourly• Settled at Day-Ahead Obligation Price
Based on Day-Ahead Settlement Point Prices
Settlements for Energy Offers and Bids
• Settled hourly• Settled at Day-Ahead Settlement Point Prices
Settlements for Ancillary Service Offers
• Settled hourly• Settled at DAM Clearing Price for Capacity (MCPC)
145
Overview
Day-Ahead Settlements
Energy Awards
PTP Obligation Awards
Ancillary Service Awards
Price * Quantity = PTP Obligation AwardsPrice is the difference between the Day-Ahead Settlement Point Prices at sink and source of the Bid
Price * Quantity = Energy Awards
Price * Quantity = Ancillary Service AwardsPrice is the Market Clearing Price for Capacity (MCPC) for each Ancillary Service
146
• Simple, two Node system• Two Settlement Points Prices • Bids and Offers for energy from QSEs• Hourly settlements
Assumptions
Day-Ahead Settlements
Offer B
Offer A Offer
C
Bid X
Node Node Bid Y
1 2 Bid Z
Scenario
147
Scenario: Day-Ahead Settlements
Offer B
Offer A Offer
C
Bid X
Node Node Bid Y
1 2 Bid Z
Limit = 2 MW
Offers
MW @
Offer A 10 MW $8
Offer B 15 MW fixed $8
Offer C 10 MW $9
Bids
MW @
Bid X 5 MW $10
Bid Y 5 MW $ 5
Bid Z 5 MW $10
148
Scenario: Day-Ahead Settlements
Offer B
Offer A Offer
C
Bid X
Node Node Bid Y
1 2 Bid Z
Limit = 2 MWSPP =
$8 / MWhSPP =
$9 / MWh
Bids Awards Charged Total Charged
MW @ MWCalculation(MW * SPP) =
FinalBid X Charged + Bid Z Charged =
Bid X 5 MW $10 5 MW 5 MW * $8 = $40
$85Bid Z 5 MW $10 5 MW 5 MW * $9 =
$45
149
Scenario: Day-Ahead Settlements
Offer B
Offer A Offer
C
Bid X
Node Node Bid Y
1 2 Bid Z
SPP = $8 / MWh
SPP = $9 / MWh
Offers Awards Paid Total Paid
MW @ MWCalculation
-1 * (MW * SPP) Final
Offer A Paid + Offer C Paid =
Offer A 10 MW $8 7 MW -7 MW * $8 = -$56-$83
Offer C 10 MW $9 3 MW -3 MW * $9 = -$27
150
Energy Awards Settlements – Congestion Rent
- = $2
• Difference is called Congestion Rent• Funds Congestion Revenue Rights
Total Charged
Bid X Charged + Bid Z Charged =
$85
Total Paid
Offer A Paid + Offer C Paid =
$83
151
What is it:
• Payment to a QSE whose revenues from the DAM are less than the costs of starting their resource and producing energy in Real-Time
• Charge to QSEs who have bids cleared in the DAM to collect all funds needed for the Make Whole Payment
Make Whole Settlement
Day-Ahead Make-Whole Settlements
152
Who is involved:
• All QSEs who submit a Three-Part Supply Offer in the DAM and are committed in the DAM
Make Whole Payment
Day-Ahead Make-Whole Settlements
153
Why it Exists:
• To guarantee that a DAM-committed Resource with a Three-Part Supply Offer recovers its allowable cost to start and run.
Make Whole Payment
Day-Ahead Make-Whole Settlements
???
154
Why it Exists:
Make Whole Payment
Day-Ahead Make-Whole Settlements
MaximizeThe Gap
Start-up costs and Minimum Energy costs are considered during
co-optimization
Day Ahead LMPs and MCPCs are derived from Energy Offer
Curves and Ancillary Service Offers.
155
Why it Exists:
Make Whole Payment
Day-Ahead Make-Whole Settlements
Revenues from selling Energy and Ancillary Services at DAM prices alone may not be sufficient
to recover Start-up and Minimum Energy costs.
156
When it’s applied:
• Statements issued 2 days after Operating Day
Make Whole Payment
Day-Ahead Make-Whole Settlements
Eligible Resources must run in Real-Time to
receive the DAM Make-Whole payment
157
• QSE 1 submits Three-Part Supply Offer for a Resource
Activities prior to the DAM:
Make-Whole Payments
Scenario
158
• Awarded 20 MW for Hour Ending 5
• DAM Settlement Point Price = $8/MWh
• No AS awarded in DAM
Activities during DAM:
Make-Whole Payments
Scenario
159
• Only assessed when the sum of a QSE’s revenues from the Day-Ahead are less than the guaranteed amount of running its Resource in Real-Time
Day-Ahead Make-Whole Payment
Make-Whole Payments
DAM Guaranteed Amount( ) ( )<Σ DAM
Revenues
Scenario
160
• Add Revenues for Energy to Revenues for Ancillary Services
To calculate DAM Revenues:
Make-Whole Payments
OR
DAM Revenues for energy
DAM Revenues for AS( ) ( )Startup Costs
Operating Energy Costs+ <
DAM Guaranteed Amount( ) ( )<Σ DAM
Revenues
+
Scenario
161
• Revenue for Energy
• Revenue for Ancillary Services
Formulas for Determining:
Make-Whole Payments
Price Quantity
(DAM SPP) (DAM Energy Sale)
Energy: OR**
Price Quantity
(DAM MCPC) (AS Sale)
AncillaryServices: OR
**
Scenario
162
• DAM Settlement Point Price: $8/MWh
• DAM Energy Sale: 20 MW for Hour Ending 5
Revenue from Energy
Make-Whole Payments
(DAM SPP) (DAM Energy Sale) #Hrs* *($8/MWh) (20 MW) 1 HR* *
Revenue for Energy = $160
Scenario
163
• Resource was not committed for AS, so Revenue from AS is zero
Revenue from AS
Make-Whole Payments
(DAM MCPC) (AS Sale) #Hrs* *($0/MWh) (0 MW) 0 HR* *
Revenue for AS = $0
Scenario
164
• Need Startup Costs
• Need Operating Energy Costs
To calculate Guaranteed Amount
Make-Whole Payments
OR
DAM Guaranteed Amount( ) ( )<Σ DAM
Revenues
DAM Revenues for energy
DAM Revenues for AS( ) ( )Startup Costs
Operating Energy Costs+ < +
Scenario
165
• Look to Three-Part Supply Offer for cost data
• All costs subject to generic caps by Resource technology
Costs to be made whole:
Make-Whole Payments and Caps
1 2 3
166
• Startup and Minimum Energy costs capped at Verifiable Costs
• Energy Offer Curve still subject to generic Make-Whole Cap
Verifiable Costs on file?
Make-Whole Payments and Caps
1 2 3
167
• Startup Costs are $100
• Minimum Energy Costs
$3 per MWh LSL is 16 MW
Resource’s Three-Part Supply Offer:
Make-Whole Payments
$100$3 / MWh
LSL = 16 MW
Scenario
168
Must add Energy costs at and aboveLSL
Determining Operating Energy Costs
Make-Whole Payments
Energy cost at LSL Energy cost above LSL+
Based on Energy Offer Curve
Based on Minimum
Energy Offer
Scenario
169
• Energy Cost at LSL based on Minimum Energy Offer
Determining Operating Energy Costs
Make-Whole Payments
Energy cost at LSL Energy cost above LSL+
Min-energy Cost LSL = Energy cost at LSL*($3/MWh) (16 MW) $48/h* =
Energy cost at LSL = $48/h
Scenario
170
• Energy cost above LSL derived from Energy Offer Curve
Determining Operating Energy Costs
Make-Whole Payments
Energy cost at LSL Energy cost above LSL+
Based on Energy Offer Curve
Scenario
171
• Equals AIEC multiplied by MW above LSL
Calculating Energy Costs above LSL
Make-Whole Payments
Average Incremental Energy Cost
AIEC = $6 per MWh
Scenario
172
Operating Energy Costs
Make-Whole Payments
Energy cost at LSL Energy cost above LSL++
$24/h
Operating Energy Costs= $72
++ $6/MWh 4 MW*
$48/h
$48/h
$48/h
AIEC MW above LSL*
Scenario
173
• Add Startup Costs to Operating Energy Costs
To calculate Guaranteed Amount
Make-Whole Payments
OR
DAM Guaranteed Amount( ) ( )<Σ DAM
Revenues
DAM Revenues for energy
DAM Revenues for AS( ) ( )Startup Costs
Operating Energy Costs+ < +
Scenario
174
• ERCOT will guarantee that resource will recover $172 in costs.
Day-Ahead Market Guarantee
Make-Whole Payments
Day Ahead Market Guarantee = $172
Startup Costs + Operating Energy Costs
$100 + $72
Scenario
175
• Because DAM Revenues are less than DAM Guaranteed Amount, QSE will receive a Make-Whole Payment
Day-Ahead Make-Whole Payment
Make-Whole Payments
DAM Guaranteed Amount( ) ( )<Σ DAM
Revenues
Scenario
176
• ERCOT calculates payment to make up the difference.
Day-Ahead Make-Whole Payment
Make-Whole Payments
Day Ahead Make Whole Payment = $12
Day-Ahead Make-Whole Payment = DAM Guarantee – DAM Revenue
Day-Ahead Make-Whole Payment = $172 - $160
Scenario
177
• Finally, the payment is spread proportionally across the DAM-committed hours
Day-Ahead Make Whole Payment
Make-Whole Payments
DAM Make Whole Payment ( )Energy Sale for hour
Total Energy Sale for all hours*
Scenario
178
• To pay out Make-Whole Payment
Make-Whole Charge used to:
Day-Ahead Make-Whole Charges
Day-Ahead Make-Whole Payment
Day-Ahead Make-Whole Charge
179
• Charged to each QSE who has at least one cleared DAM Energy Bid or PTP Obligation Bid.
DAM Make-Whole Charge
Make-Whole Charges
*( ) ( )Total DAM Make-Whole Payments ERCOT - Wide
DAM Energy PurchaseRatio Share
OR
*( ) ( )Total DAM Make-Whole Payments ERCOT - Wide
A QSE’s DAM Energy Purchase
Total DAM Energy PurchasesERCOT - Wide
Scenario
180
• Total DAM purchase: 100 MW
• Total Make Whole: $100
Calculate the QSE Day-Ahead Make-Whole Charge
Make-Whole Charges
QSE Name QSE DAM Purchase
QSE DAM EnergyPurchase Ratio
Share
QSE Day-Ahead Make-Whole Charge
QSE 1 20 MW 20 MW / 100 MW $20
QSE 2 40 MW 40 MW / 100 MW $40
QSE 3 10 MW 10 MW / 100 MW $10
QSE 4 30 MW 30 MW / 100 MW $30
Scenario
181
• Impact of inputs into the Day-Ahead Market
• Responsibilities of ERCOT, QSEs, and TSPs in regards to the Day-Ahead Market
• The financial impact of choices made in the Day-Ahead
You have learned about:
Module Summary
Module Conclusion