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Market Analysis: ERCOT, PJM, CA-ISO, MISO

Analysis of CRR markets in ERCOT, PJM, CA-ISO, MISO with bid limitations, submissions data, and auction complexities.

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Market Analysis: ERCOT, PJM, CA-ISO, MISO

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  1. CRR Sizing Update Jim Bohart Steve Reedy Nodal Advisory Task Force

  2. Bid Limitations in the CRR Market in ERCOT • In the ERCOT CRR Market there is a need to limit submissions • In each CRR Auction, the total number of submissions + previously awarded CRRs cannot go over 200,000 • Short term issue is a dimension sizing in auction engine • Long term issue is length of time to solve extremely complex auction with large number of bids • Probable bid limits for first six monthly auctions • Number of Allocated PCRRs ~500 • Number of registered market participants currently ~80 • Currently 61 Account Holders have qualified • Number of bids per participant ~ 2,500 • (200,000-500)/80 = 2,493 or (200,000-500)/61 = 3,270 • Bid Limit is per month in Monthly Auction • Bid Limit is per year in Annual Auction Nodal Advisory Task Force

  3. PJM • PJM market conducts an Annual auction and an Monthly auction • Prompt month, plus adjacent months, and quarterly options are available during each monthly auction • Credit is calculated as bids/offers are submitted • Largest auction by total submissions was July 2009 with 849,742 • July Only submissions were 306,644 • Largest prompt month submissions were 464,697 in Oct 2009 • PJM is the most mature of the CRR/FTR markets and has the largest generation of the ISOs Nodal Advisory Task Force

  4. PJM • All Submissions for 2009: Submissions by Month - PJM Nodal Advisory Task Force

  5. PJM • All Submissions for 2009: Submissions by Month - PJM Nodal Advisory Task Force

  6. PJM • Cleared Transactions from 2009 Monthly Auction (Prompt Only): Nodal Advisory Task Force

  7. CA-ISO • CA-ISO market conducts Long-Term, Annual and Monthly auctions • Monthly auction consists of prompt month, and seasonal availability( quarterly submissions) • Options and Obligations are available in all auctions • Options currently only available to project sponsors of a Merchant Transmission Facility • Credit is calculated as bids/offers are submitted • Only a handful of Market Participants enter more than 2,000 submissions • Annual auction has around 80 participants • Monthly auction has between 40 - 45 participants Nodal Advisory Task Force

  8. Midwest ISO • MISO is the most similar market to ERCOT • Currently run an annual and prompt month auctions • Nexant Optimization software • Credit is calculated as Bids/Offers are submitted • Have a cap of 2,000 submissions per participant • Last 6 monthly auctions averaged 26,613 submittals • Roughly 391 submissions per Market Participant • Completing a Multi-tier Auction project in Oct 2011 • Hope to allow up to 5,000 submissions per Market Participant Nodal Advisory Task Force

  9. Midwest ISO • Submittals from 2009 – 2010 Annual Auction: Nodal Advisory Task Force

  10. Midwest ISO • Cleared Transactions from 2009 – 2010 Annual Auction: Nodal Advisory Task Force

  11. Midwest ISO • Monthly Auction Submissions: 2008 - 2010 Nodal Advisory Task Force

  12. Midwest ISO • Cleared Transactions from 2009 Monthly Auction: Nodal Advisory Task Force

  13. ERCOT Auction considerably more complex than other Nexant Markets • Multiperiod • Monthly solves over three models simultaneously • Annual solves over twelve models simultaneously • Larger number of contingencies • ~2,000 for ERCOT • ~1,500 – 2,000 for MISO • ~200 or less for CALISO • Both of these (protocol required) features have huge (~ 2 orders of magnitude) implications in the complexity of the auction • Protocol 7.5.5.3 (1) • “The auction must be a single-round, simultaneous auction for selling the CRRs….” • Protocol 7.5.1 (2) • “The CRR Network Model must, to the extent practicable, include the same topology, contingencies, and operating procedures as used in the Network Operations Model…” Nodal Advisory Task Force

  14. Comparison of other ISOs Nodal Advisory Task Force

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