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Nodal Settlement Delta Calculations and Statements

Nodal Settlement Delta Calculations and Statements. Objective: Describe the recommended design of nodal settlement delta calculations and statements. What is the problem?. Zonal Settlement System produces excessive interval data of questionable value to ERCOT and Market Participants.

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Nodal Settlement Delta Calculations and Statements

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  1. Nodal Settlement Delta Calculations and Statements • Objective: Describe the recommended design of nodal settlement delta calculations and statements.

  2. What is the problem? • Zonal Settlement System produces excessive interval data of questionable value to ERCOT and Market Participants

  3. Zero Data Statistics(Production Lodestar Database as of 4/26/05)

  4. Zonal Settlements System Architecture Stress Test Results

  5. Current Settlements System Characteristics • Always produce 5 output interval cuts regardless of value • PRICE, QUANTITY, AMOUNT, BILLAMT, BILLQTY • Force PRICE X QUANTITY format • Deltas (BILLQTY, BILLAMT) calculated at interval level • Zero data calculated at interval level and calculated for deltas • Statements repeat previous settlement data

  6. Regulation Up Service Charge - LARU • LARUAMT = (PCRUAMTew + PCOOMRUAMTew) / (RULRSOBew – RUSAQew) * (RULRSOBqse – RUSAQqse) • LARUPRICE = (PCRUAMTew + PCOOMRUAMTew) / (RULRSOBew – RUSAQew) • LARUQTY = (RULRSOBqse – RUSAQqse) • LARUAMT = LARUPRICE * LARUQTY • LARUBILLQTY = Current LARUQTY – Previous LARUQTY • LARUBILLAMT = Current LARUAMT – Previous LARUAMT

  7. Current Settlements System Example First Settlement Run Formula: D_AMT = (A + B) * C Input Interval Cut A = 5,4,6,5,4 Input Interval Cut B = 0,0,0,0,0 Input Interval Cut C = 2,2,2,2,2 Forced PRICE*QTY -> D_QTY = A + B, D_PRICE = C Output Interval Cut D_QTY = 5,4,6,5,4 Output Interval Cut D_PRICE = 2,2,2,2,2 Output Interval Cut D_AMT = 10,8,12,10,8 Total = 48 Output Interval Cut D_BILLQTY = 5,4,6,5,4 Output Interval Cut D_BILLAMT = 10,8,12,10,8 Total = 48

  8. Current Settlements System Example Second Settlement Run Formula for D_AMT = (A + B) * C Input Interval Cut A = 5,4,6,5,4 Input Interval Cut B = 1,1,1,1,1 Input Interval Cut C = 2,2,2,2,2 Forced PRICE*QTY -> D_QTY = A + B, D_PRICE = C Output Interval Cut D_QTY = 6,5,7,6,5 Output Interval Cut D_PRICE = 2,2,2,2,2 Output Interval Cut D_AMT = 12,10,14,12,10 Total = 58 Output Interval Cut D_BILLQTY = 1,1,1,1,1 Output Interval Cut D_BILLAMT = 2,2,2,2,2 Total = 10

  9. Current Settlements System Inefficiencies • Input interval cuts are restated as PRICE and QTY cuts • Deltas (BILLQTY, BILLAMT) calculated at interval level (15min, hourly) • Excessive interval data • Zero data calculated at interval level and calculated for deltas • High zero data overhead, excessive interval data

  10. Nodal Protocol Needs Increased number of charge and payment types to process • 55 to 80 →More data • Lower granularity of settlement output • Settlement Points, RUC →More data • Increased use of interim calculations • More data • New statements and invoices ______________________________________ = Differing Architectural Needs for Nodal Settlement and Billing System

  11. Nodal Settlements System Design Proposal • Simplify data requirements while still giving the Market what they need – we need to be lean and efficient • No PRICE and QTY cuts • Inputs and Outputs specified in Nodal Protocols • No BILLQTY delta cut • Quantity cuts do not exist in Nodal Protocols so we will not create them nor the corresponding delta cut • BILLAMT delta cut NOT at interval level • BILLAMT calculated at Trade Date summary level • Zero AMT output saved at Trade Date summary level unless non-zero values sum to zero • No zero amount interval data when every interval is zero • Statements will not repeat previous settlement data • Statements roll up charges/payments to statement recipient level (even if charges/payments are at SPP or Resource Node level) • All Input and Output data available in extracts

  12. Nodal Settlements System Example 1 First Settlement Run Formula: D_AMT = (A + B) * C Input Interval Cut A = 5,4,6,5,4 Input Interval Cut B = 0,0,0,0,0 Input Interval Cut C = 2,2,2,2,2 Output Interval Cut D_AMT = 10,8,12,10,8 Total = 48 Output D_BILLAMT = 48 1st Statement Interval D_AMT 1 10 2 8 3 12 4 10 5 8 D_AMT Total = 48 D_BILLAMT = 48

  13. Nodal Settlements System Example 1 Second Settlement Run Formula: D_AMT = (A + B) * C Input Interval Cut A = 5,4,6,5,4 Input Interval Cut B = 1,1,1,1,1 Input Interval Cut C = 2,2,2,2,2 Output Interval Cut D_AMT = 12,10,14,12,10 Total = 58 Output D_BILLAMT = 10 2nd Statement Interval D_AMT 1 12 2 10 3 14 4 12 5 10 D_AMT Total = 58 D_BILLAMT = 10

  14. Nodal Settlements System Example 1 Third Settlement Run Formula: D_AMT = (A + B) * C Input Interval Cut A = 5,4,6,5,4 Input Interval Cut B = 1,1,1,1,1 Input Interval Cut C = 2,2,2,2,2 Output Interval Cut D_AMT = 12,10,14,12,10 Total = 58 Output D_BILLAMT = 0 3rd Statement D_AMT Total = 58 D_BILLAMT = 0

  15. Nodal Settlements System Example 2 First Settlement Run Formula: D_AMT = (A + B) * C Input Interval Cut A = 5,4,6,5,4 Input Interval Cut B = 1,1,1,1,1 Input Interval Cut C = 0,0,0,0,0 Output D_AMT = 0 Output D_BILLAMT = 0 1st Statement D_AMT Total = 0 D_BILLAMT = 0

  16. Nodal Settlements System Example 2 Second Settlement Run Formula: D_AMT = (A + B) * C Input Interval Cut A = 5,4,6,5,4 Input Interval Cut B = 1,1,1,1,1 Input Interval Cut C = 1,1,1,1,1 Output Interval Cut D_AMT = 6,5,7,6,5 Total = 29 Output D_BILLAMT = 29 2nd Statement Interval D_AMT 1 6 2 5 3 7 4 6 5 5 D_AMT Total = 29 D_BILLAMT = 29

  17. Nodal Settlements System Example 3 First Settlement Run Formula: D_AMT = (A + B) * C Input Interval Cut A = 5,4,6,5,4 Input Interval Cut B = 1,1,1,1,1 Input Interval Cut C = 0,1,0,0,-1 Output Interval Cut D_AMT = 0,5,0,0,-5 Total = 0 Output D_BILLAMT = 0 1st Statement Interval D_AMT 1 0 2 5 3 0 4 0 5 -5 D_AMT Total = 0 D_BILLAMT = 0

  18. Nodal Protocol Compliance 9.2.1 Settlement Statement Process for the DAM ERCOT shall produce daily Settlement Statements for the Day-Ahead Market (DAM), as defined in Section 9.2.2, Settlement Statements for the DAM, that show a breakdown of financial obligations between ERCOT and a Market Participant incurred in the DAM, including any administrative and miscellaneous charges applicable to the DAM. 9.2.2 Settlement Statements for the DAM (7) Settlement Statements for the DAM must break fees down by Charge Types into the appropriate one-hour Settlement Interval for that type. 9.2.3 DAM Settlement Charge Types ERCOT shall provide, on each Settlement Statement, the dollar amount for each DAM Settlement charge and payment. 9.2.5 DAM Resettlement Statement (3) A DAM Resettlement Statement must reflect differences to financial records generated on the previous Settlement Statement for the given DAM. 9.5.1 Settlement Statement Process for the Real-Time Market ERCOT shall produce daily Settlement Statements for the Real-Time Market (RTM), as defined in Section 9.5.2, Settlement Statements for the RTM, that show a breakdown of Charge Types incurred in the RTM, including any administrative and miscellaneous charges applicable to the RTM. 9.5.2 Settlement Statements for the RTM (8) A Settlement Statement for the RTM must break the fees down by Charge Type into the appropriate 15-minute or one-hour Settlement Interval for that type. 9.5.3 Real-Time Market Settlement Charge Types ERCOT shall provide, on each RTM Settlement Statement, the dollar amount for each RTM Settlement charge and payment. 9.5.5 RTM Final Statement (2) An RTM Final Statement will reflect differences to financial records generated on the previous Settlement Statement for the given Operating Day 9.5.6 RTM Resettlement Statement (6) An RTM Resettlement Statement will reflect differences to financial records generated on the previous Settlement Statement for the given Operating Day. 9.5.8 RTM True-Up Statement (3) An RTM True-Up Statement will reflect differences to financial records generated on the previous Settlement Statement for the given Operating Day.

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