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June 4, 2013 | Westborough, ma

June 4, 2013 | Westborough, ma. A Strategic Planning Initiative. FCM Performance Incentives. Parviz Alivand. Senior analyst Internal Market Monitor. Dynamic de-list Threshold.

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June 4, 2013 | Westborough, ma

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  1. June 4, 2013 | Westborough, ma A Strategic Planning Initiative FCM Performance Incentives Parviz Alivand Senior analyst Internal Market Monitor

  2. Dynamic de-list Threshold • In April MC, IMM noted that the Dynamic De-list Threshold will increase to at least a level corresponding to the ‘common component’ of a profit maximizing participant Common Component=PPR x Br x H • Br is the balancing ratio, H is the number of reserve deficiency hours and PPR is the Performance Payment Rate. • Level of common component depends on Brand H • One approach is for IMM to publish H and Br each year for the purpose of establishing a Dynamic De-list Threshold.

  3. Static and Permanent de-list Bids • If a participant’s desired de-list bid exceeds the Dynamic De-list Threshold, they may submit either a static or permanent de-list bid. Per Tariff, IMM reviews these bids. • A de-list bid might become Static or Permanent if participants: • Believe Hor Brwill be different than the base assumption • Have high GFC

  4. Static and Permanent de-list Bids • IMM will ask resources to submit documentation for their bids in three categories: GFC, Expected PFP, and PFP Risk Premium • Review will take into account the portfolio size, and consistency of assumptions across resources. • IMM agrees that resources face different costs and risk at different levels of output in their unit and should be allowed to submit different prices for different segments of their capacity

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