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Mandy BauldERCOTOctober 9, 2012
RTM SETTLEMENT TIMELINE
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Why are we talking about this?
– Multiple parties are interested in reducing the RTM Settlement timeline to help• Reduce collateral requirements
• Reduce risk of uplift
– The NPRR347 and NPRR391 invoicing and payment timeline changes shortened the total billing cycle by ~10-13 days
– Previous efforts made minimal change to the timeline for posting the RTM Statement
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Refresher – Current Settlement Timelines
Day-Ahead Market Real-Time Market
Statement Post Date OD + 2 OD + 9
Invoice Post Date OD + 2 OD + 14 to 24
Invoice Due Date OD + 5 OD + 21 to 30
Invoice Payout Date OD + 6 OD + 22 to 31
Invoice Frequency Business Daily Weekly
Current Protocol Requirements:
Day-Ahead Market Real-Time Market
Statement Post Date OD + 2 OD + 9
Invoice Post Date OD + 2 OD + 9
Invoice Due Date OD + 4 OD + 11
Invoice Payout Date OD + 5 OD + 12 to 18
Invoice Frequency Business Daily
After November 2012 Implementation (NPRR347 & NPRR391):
Note: The timelines are stated generally in relation to the Operating Date and do not reflect all variations due to holidays and bank holidays.
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High-Level Considerations
The existence and magnitude of the impacts mentioned below depends entirely on the extent of the reduction to the settlement timeline
Quality of Market Settlements – Potential impacts to data availability and accuracy:
• Unavailable input data• Inability to perform manual settlement calculations• Minimized data validation• Limited time for issue resolution
Staffing Impacts– Potential impacts to support weekend and holiday workloads and/or to execute existing functions
in shorter period of time
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Data Considerations
Increasing availability of AMS data is not the only data consideration. Various types of data is required for RTM settlements:
–Load Data• Usage is estimated if not available for use in the initial Data Aggregation process (OD + 7)• Approximately 70% of August 2012 initial settlement load was based on actuals• AMS (40%), Competitive IDR (24%), NOIE (26%), and NIDR (10%) all need to be considered
–Generation Data• Current processes strive to have the data available for use in the initial Data Aggregation process (OD+7)• ERCOT performance indicators require no more than 1% change after initial settlement
–Markets & Operations Data• Current processes complete the transfer data to the settlement system by end of day on OD+1. • Prices are not considered final until 1600 of the next Business Day after the Operating Day (6.3 (4))• Energy trades can be entered as late as 1430 on OD +1 (4.4.2(3))
–Manual Calculations or Data changes• Utilize upstream data and complete prior to use in settlement (OD+8)• Examples include: emergency energy settlements (manual overrides, QSGR dispatch, SCED failure),
processing VDIs, processing price corrections, and other ad-hoc data correction
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RTM Settlement Timeline
What’s next?– CWG quantifying the credit benefit– Request COPS to determine its next step.
• As a starting point, COPS may want to consider efforts to:
– Review the benefits described by CWG
– Define the scope of the effort
» Commissioner Anderson stated interest in a “material reduction” to the timeline. CWG is discussing an option of OD+3. Suggest that analysis includes discussion of an OD+3 option so that we are prepared with a specific response regarding considerations and feasibility of this option.
» Identify the availability timelines for all data and any opportunity for improvements (TAC discussion)
– Define guiding principles
– Define options
– Identify and document the impacts of each option on each segment (people, processes, technology)
– Develop a recommendation
• ERCOT can help facilitate the COPS effort and documentation of the findings
• Other?
7February 10, 2009
APPENDIX
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Data Considerations
Type % of ERCOT Load*
% Availableon initial
settlement*
Interval Basis
Data Typically Settlement-
Ready
ASSUMPTIONS about Impacts and Challenges
AMS 39.6% 39.3% 15-min +4 to+6 - A reduced timeline would narrow the window for data submission , and correction if necessary, for use on initial settlement.
- Experience indicates that TDSPs target complete and accurate data submission for use on initial settlement.
- TDSPs – what would be the impact to maintain similar levels of actual data on initial settlement? Would there be impact to staffing or business processes on weekends and/or holidays?
COMP_IDR 23.9% 3.8% 15-min Monthly - Submittal based on TDSP monthly read cycles. Shortening the timeline will reduce available data based on the TDSP monthly read cycles.
NOIE 26.5% 24.8% 15-min +6 - A reduced timeline would narrow the window for NOIE data activities prior to use on initial settlement.
- Experience indicates that NOIEs target complete and accurate data submission for use on initial settlement.
- NOIEs – what would be the impact to maintain similar levels of actual data on initial settlement? Would there be impact to staffing or business processes on weekends and/or holidays?
NIDR 10.0% 1.7% Monthly Monthly - Submittal based on TDSP monthly read cycles. Shortening the timeline will reduce available data based on the TDSP monthly read cycles.
- NIDR represents a decreasing share of the ERCOT load, but assuming that NIDR will not drop to a 0% share
Total 100% 69.6%
Load Data Availability
* Percentages reported for August 2012
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Data Considerations
Generation Data Availability% Accurate and
Complete on Initial Settlement
(target and stretch KPIs)
Data Received
VEE Complete
and Issues Resolved
Data Used in
Settlement
ASSUMPTIONS about Impacts and Challenges
ERCOTPolled Settlement Meters
99% - 99.9% +1 +6 +7 - To maintain similar standards of data availability and accuracy on initial settlement, it is reasonable to assume that there may be ERCOT staffing impacts to execute business processes on weekends and/or holidays.
- TDSPs - what would be the impact to maintain similar standards of data availability and accuracy on initial settlement? Would there be impact to staffing or business processes on weekends and/or holidays?
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Data Considerations
Settlement CalculationsASSUMPTIONS about Impacts and Challenges
Accuracy on initial settlements - Current systems and processes transfer markets and operational data to the settlement system at various times through the day after the Operating Day. Timelines for upstream data availability and integration into the settlement system will be a limiting factor. Impact to integration activities would be relative to the magnitude of the reduction of the timeline.
- Certain settlement activities are handled on a manual basis prior to initial settlement. Examples of such processes that may be impacted include but are not limited to: emergency energy settlements for emergency base points or non-economic dispatch on a daily basis, price corrections on an ad-hoc basis, or data integration issues on an ad-hoc basis. Impact to settlement accuracy or completeness would be relative to the magnitude of the reduction in the timeline.
- If an additional settlement iteration is incorporated into the settlement schedule, it is reasonable to assume that there may be staffing and procedural impacts to ERCOT.
- QSEs/CRRAH – what would be the impact to support an additional settlement iteration? What is the impact of settlement is not “complete” on the first iteration?
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History of Settlement Timeline
Posting Date for Initial Settlement Statements
Effective Period
OD + 3 August 2000 – March 2002
OD + 17 March 2002 – January 2006
OD + 10 January 2006 - November 2011
OD + 9 December 2011 - current
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Other Markets
– Generally speaking, the FERC-jurisdictional ISOs/RTOs settle to cash clearing within 14 days
– Specific timelines vary across the ISOs/RTOs
http://www.cftc.gov/stellent/groups/public/@requestsandactions/documents/ifdocs/iso-rto4cappfercchart.pdf