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NAESB OASIS Subcommittee Long Term Competition

NAESB OASIS Subcommittee Long Term Competition. Mike Norris, Rebecca Berdahl May 13, 2014. Recap from April OS Meeting. Two LT Competition Options Presented ‘ Strawman ’ BPA’s current implementation Fundamental difference between the two options is what triggers the competition

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NAESB OASIS Subcommittee Long Term Competition

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  1. NAESB OASIS SubcommitteeLong Term Competition Mike Norris, Rebecca Berdahl May 13, 2014

  2. Recap from April OS Meeting • Two LT Competition Options Presented • ‘Strawman’ • BPA’s current implementation • Fundamental difference between the two options is what triggers the competition • ‘Strawman’ – a new request is submitted • BPA’s – a Renewal request is submitted

  3. Recap from April OS Meeting (cont’d) • Depending on which option is chosen, additional differences result such as: • Competition Time Horizon • ‘Strawman’ – competition time horizon could be years • BPA’s – competition time horizon never more than several weeks • Competition Inventory Management • ‘Strawman’ – new type of persistent inventory created that must be actively managed (e.g., ‘Unexercised Renewal Rights) over the long term • BPA’s approach – ‘Unexercised Renewal Rights’ inventory is attached to a specific Renewal TSR and is limited to the amount in that Renewal TSR

  4. Overview – Questions to be Answered • Illustration - State Diagram (‘Strawman’ Rule Set) • Three Confirmed Reservations • Two Contingent Reservations • Describe areas of LT C complexities • TSR Assessment • Relationship Management and Types • Competition Rule Set • Inventory Management

  5. “Strawman” State Diagram

  6. “Strawman” State Diagram Assumptions • All capacity buckets are sold out except for Unexercised Renewal Rights Bucket (reality the offer would be filled 0-100% from that bucket) • Contingent offers were made and accepted resulting in CONFIRMED reservations

  7. Relationships between Reservations with Renewal Right and Contingent Reservations • There are many possible relationships that could be established between reservations with unexercised renewal rights and contingent reservations: • One to One: a specific contingent reservation is linked to a specific reservation • One to Many • Many to One • Many to Many • For each of the relationships listed above there are a set list of questions/issues that must be worked through • TSR Assessment (Pending Requests) • Relationship Management (CONFIRMED Contingent Reservations) • Competition Mechanics • Inventory Management (Unexercised Renewal Rights Bucket)

  8. One to One: TSR Assessment • New bucket of inventory is now available to satisfy requests (Unexercised Renewal Rights) • Current assessment process would remain the same there would simply be a new offer type available (Contingent Service Agreement) • Probable outcomes • Many requests would be satisfied via the Contingent Service Agreement offer type • Queue would shrink

  9. One to One: Relationship Management • For each Contingent Reservation, the TP must track the Reservations with unexercised renewal rights it is contingent on. • Given that it could be years before a Contingent Reservation may have an opportunity to challenge, the tracking solution will need to be robust.

  10. One to One: Competition Mechanics • How many Challengers (e.g., Contingent Reservations) must a Defender be required to ‘defend’ against? • One • Many • How many eligible challengers get to challenge the defender? • One • Many

  11. One to One: Inventory Management • Where does the released capacity not used by Contingent Reservation go? • Back to market? • Back to Unexercised Renewal Rights Capacity Bucket? • How to reconcile the Inventory Bucket (mW) with the Tariff language (Duration)?

  12. Competition Mechanics: Many to One • Tariff language uses duration as the single criteria used in LT C to determine who gets the capacity. • If there are many Challengers (e.g., Contingent Reservations) what criteria should be used for competition • Individually by queue time (Many Challengers to one Defender, TP runs several iterations) • Batch the Challengers to determine a ‘winner’. (One Challenger to one Defender, TP runs one competition)

  13. Other Complexities • Deferrals • Redirects • Resales • Timing, Inventory Management, etc… associated with the above

  14. Proposal • Strong preference for creating a new project to do Long Term Competition NAESB standards development work • A case can be made for creating a new project: • Complexities • Examples noted in previous slides • LT C project implementation timeline is longer than what is available in the current C&P project • Additional complexities associated with the current ‘Strawman’ • BPA’s Point/Counterpoint

  15. Proposal (cont’d) Proposed Motion Language Exclude the development of Long Term Competition standards and implementation from the current NAESB OS Competition and Preemption project. Create a new project, ‘Long Term Competition’, to complete this body of work.

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