TNT Commercial Operations Working Meeting

1
TNT Commercial Operations Working Meeting

• David Potts
• March 23, 2004

2
Agenda

• Objective
• What We Know
• Nodal Settlements in Other Markets
• What We Dont Know

3
Objective
Determine if there is an existing Nodal Market
that we could emulate from a settlements
perspective.
4
What We Know

• Key Assumptions Relevant to Settlements
• 15-minute Settlement Intervals
• Integrate 5-minute LMPs
• Hubs are simple average Zones are weighted
  average
• ADAM
• Available at or before market go-live
• Financial forward market with binding clearing
  prices
• Congestion is not reflected in the clearing
  process
• E-HDAM
• Available 1 year after market go-live
• Similar to other nodal based Day-Ahead Markets
• Unique feature - option to move CRRs to RT

5
What We Know (continued)

• Key Assumptions Relevant to Settlements
• Two Settlement System
• Separate prices for Day-Ahead and Real-Time
  Markets
• Real-Time Markets will be settled based upon
  deviation from DA
• Losses
• Average losses continue
• Make Whole
• Generators who perform will be made whole
• CRRs
• Target allocation uses a Shadow Price vs.
  difference in LMPs (Sink Source)
• Admin Fee will remain the Same

6
Typical FootprintNodal Settlements

• Settlement Calculation Categories
• Energy Settlements
• Congestion Settlements
• Loss Settlements
• Operating Reserve or Make Whole Settlements
• Ancillary Service Settlements (Reg, Spin,
  Non-spin, OR, Replacement)
• BENA Other Uplifts

• Capacity Settlements (ICAP)
• Black Start/RMR
• FTR Settlements
• Others (URC)

7
Texas Nodal Settlements

• Settlement Calculation Categories
• Energy Settlements
• Congestion Settlements
• Loss Settlements
• Operating Reserve or Make Whole Settlements
• Ancillary Service Settlements (Reg, Spin,
  Non-spin, OR, Replacement)
• BENA Other Uplifts

• Capacity Settlements (ICAP)
• Black Start/RMR
• FTR Settlements
• Others (URC)

8
Before After
Imbalance Energy (RI, LI, AS Energy/Reserves)
Energy Settlement (ANI)
URC
URC?, Make Whole?, LMP Mitigation
OOM Local Capacity
Make Whole
OOM Local Balancing Energy
Energy Settlement (Offer/LMP mitigation)
Congestion (BE RPRS CSC)
Congestion Settlement (ANI)
TCRs/P-TCRs (Options)
CRRs/P-CCRs (Options Obligations)
AS Capacity (URS, DRS, RRS, NSRS, RPRS)
AS Capacity (URS, DRS, QSS)
BENA
BENA?
Mismatches
Goes Away Confirm Schedules
BUL
BUL?
RMR
RMR
Black Start
Black Start
9
Energy Settlement ADAM
ClearedSupply
ActualSupply
Day Ahead Market
Post Day Ahead Real-Time Market
Imports
Offers
Metered Gen
Bilateral Purc
Supply Demand(per location)
Supply Demand(per location)
Cleared Demand
ActualDemand
Day Ahead Adj. Net Interchange(DA ANI)
Real-Time Adj. Net Interchange(RT ANI)
Bids
Metered Load
Exports
Bilateral Sale
Other
RT ANI DA ANI
Make Whole
URC
Day Ahead Settlement QtyxAuction Clearing
Price
Real-Time Settlement QtyxLMP or LMP Component
AS Energy
10
Energy Settlement E-HDAM
ClearedSupply
ActualSupply
Day Ahead Market
Post Day Ahead Real-Time Market
Self Schedule
Imports
Gen Awd
Metered Gen
Supply Demand(per location)
Supply Demand(per location)
Virtual Supp
ActualDemand
Imports
Day Ahead Adj. Net Interchange(DA NI)
Real-Time Adj. Net Interchange(RT NI)
Metered Load
Bilateral Purc
Exports
Cleared Demand
Other
Demand Bids
Make Whole
Virtual Demd
RT NI DA NI
URC?
Exports
AS Energy
Bilateral Sale
Day Ahead Settlement Qtyx LMP or LMP Component

Real-Time Settlement QtyxLMP or LMP Component
Other
Make Whole
11
What We Dont Know

• Key Questions
• From a settlement perspective, is there a market
  we want to emulate (PJM, NY, NE, MISO)?
• Are we going to componentize the LMP?
• If so, how are we going to select the reference
  bus (static/variable)?
• How will the energy behind the capacity be
  dispatched?
• Will the dispatches be separated or part of the
  energy set-point?
• What will be the inputs to BENA?
• Who will clear the Auction Day-Ahead Market?

12
What We Dont Know (continued)

• Key Questions
• How will the CRR payments and charges work?
• How will DC Ties be treated?
• How will the Make Whole charge be allocated?
• Are there specific eligibility requirements for
  the make whole besides offering and starting up?
• Based upon minimum of instruction vs. meter
  reads