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Market Credit Working Group update to the Wholesale Market Subcommittee

Comprehensive update on ERCOT Market Credit Working Group's recent activities and discussions, including credit impacts, settlement changes, portfolio valuation, market entry qualifications rules, and credit exposure updates.

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Market Credit Working Group update to the Wholesale Market Subcommittee

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  1. Market Credit Working Group update to the Wholesale Market Subcommittee 05/01/2019 Bill Barnes NRG, Chair Josephine Wan Austin Energy, Vice Chair

  2. MCWG update to WMS • General Update • April 18th Joint MCWG/CWG Meeting • 3NPRRS reviewed for their credit impacts • 917NPRR Nodal Pricing for Settlement Only Distribution Generators (SODGs) and Settlement Only Transmission Generators (SOTGs) • 926NPRR Removal of 90-Day Period Between SSR Study Approval and Synchronization • 929NPRR PTP Obligations with Links to an Option DAM Award Eligibility • All operational and without any credit impact. Discussion on settlement changes and impact to credit.

  3. MCWG update to WMS Review of ERCOT CRR Portfolio Valuation Assess the risk of a large CRR portfolio default Dollars

  4. MCWG update to WMS Review of ERCOT CRR Portfolio Valuation Assess the risk of a large CRR portfolio default MWh

  5. MCWG update to WMS CRR Portfolio Disposal Discussion • Modify existing one-time auction • Allow negative bidding • Allow “percentage slices” to be purchased • Liquidate in next Long Term Auction or Monthly Auction Sequence • Allows for more competitive solution • Could distort outcomes if portfolio is large • No auction, liquidate all rights in DAM • Most competitive result • Drags out default over very long time (up to 3 yrs)

  6. MCWG update to WMS Market Entry Qualifications Rules & Process ERCOT legal informed the group that they do not see issues with reviewing current market entry qualifications.

  7. MCWG update to WMS ERCOT Credit Exposure Updates • Market-wide average TPE increased from $263.8 million to $298.5 million • The increase in TPE is due to higher prices in early March • Discretionary Collateral is defined as Secured Collateral in excess of TPE,CRR Locked ACL and DAM Exposure. • Average Discretionary Collateral decreased from $ 1,034.8 million to $926.7 million • The decrease in Discretionary Collateral is largely due to decrease in Secured Collateral • Number of active Counter-Parties increased from 233 to 237 • No unusual collateral call activity

  8. MCWG update to WMS

  9. MCWG update to WMS

  10. MCWG update to WMS

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