Wholesale Market Subcommittee

1. Wholesale Market Subcommittee Report to Technical Advisory Committee August 2010

2. TAC Action Items • Voting Items • WMS Procedures • Commercially Significant Constraints (CSC) removed and Competitive Constraints added • Added Bullet: Providing input into Planning Guides development and revisions • Updated WG and TF list • Recommend TAC Approval

3. TAC Action Items • TAC Discussion Item (possible vote) • WG and TF Comments • WMS recommends that WG and TF comments on PRR/NPRR’s be submitted back to the Subcommittee listserv and not to revisionrequest@ercot.com or other subcomittee/committee listservs. • WMS would like WG and TF to provide an attendees list with any comments to provide sunshine on segments represented by the comments. • NEW Working Group Comment form introduces a section for the Working Group Attendees List - so that a reviewer can better understand if the comments reflect narrow or broad market consensus since the WG's and TF's have no formal voting structure. • Recommend TAC Approval

4. In Brief • Withdrawn NPPR • NPRR 147 – DAM Short Pay Changes • On June 15, 2010, the ERCOT Board approved NPRR221, Day-Ahead Market and Real-Time Market Default Allocation Changes. NPRR221 was introduced as an alternative to NPRR147. NPRR147 is therefore no longer necessary. Accordingly, at the July 21, 2010 WMS meeting, WMS unanimously voted to withdraw NPRR147. • WMS, as the original sponsor of NPRR147. On July 27th, Notice of Withdrawal was filed on behalf of WMS.

5. In Brief • Upcoming NPPRs (not on Today’s Agenda) • NPRR 231 – Remove RMR Units from the Day-Ahead Market • At the July 21, 2010 WMS meeting, WMS considered NPRR 231. After discussion, WMS unanimously voted to endorse NPRR231 as amended by the 7/12/10 PSEG TX comments and as revised by WMS and to request that ERCOT subject matter experts review the proposed revisions for potential impacts. . • Key Points: • RENAME: Treatment of RMR Units in the Day-Ahead Market • RMR Unit available for commitment in DRUC, HRUC, or DAM, only when it has determined that the RMR Unit is likely to be needed in RT for reliability reasons, taking into consideration whether SCED will solve transmission constraints without the RMR Resource

6. In Brief • Upcoming NPPRs (not on Today’s Agenda) • NPRR 240 – Proxy Energy Offer Curve • At the July 21, 2010 WMS meeting, WMS considered NPRR240. After discussion, WMS voted to endorse NPRR240 as amended by the 7/6/10 Potomac Economics comments and as revised by WMS. There was one abstention from the Independent Power Marketer (IPM) Market Segment. • Key Points: • The Entity with decision making authority over how a Resource or Split Generation Resource is offered or scheduled, as more fully described in Section 3.19.1, Annual Competitiveness Test, shall be responsible for all offers associated with each Resource, including offers represented by a proxy Energy Offer Curve. • [NPRR240: Insert paragraph (5) below upon system implementation:] • Energy Offer Curves that were constructed in whole or in part with proxy Energy Offer Curves shall be so marked in all ERCOT postings or references to the energy offer.

7. In Brief • Upcoming NPPRs (not on Today’s Agenda) • NPRR 241 – Aggregate Incremental Liability (AIL) Calculation and Credit Reports Publish Corrections • At the July 21, 2010 WMS meeting, WMS considered Nodal Protocol Revision Request (NPRR) 241. After discussion, WMS unanimously voted to endorse NPRR241 as amended by the 7/20/10 Reliant Energy Retail Services LLC comments and as revised by WMS. There were two abstentions from the Consumer Market Segment. • Key Points: • Minor change to Reliant comments: • ERCOT shall post once each Business Day on the MIS Certified Area each active Counter-Party’s credit monitoring and management related reports or extracts as listed below; however, these reports may not be posted if system limitations are prohibitive.

8. In Brief • Upcoming NPPRs (not on Today’s Agenda) • NPRR 243 – Load Resource Disqualification, Unannounced Testing, and Compliance • At the July 21, 2010 WMS meeting, WMS considered DSWG recommended changes to Nodal Protocol Revision Request (NPRR) 243. After discussion, WMS unanimously voted to endorse NPRR243 as revised by WMS. . • Key Points: • must return to at least 95% of its committed obligation Ancillary Service Resource Responsibility for Responsive Reserve RRS as soon as practical considering process constraints, but not more three hours. within three hours following a recall instruction from ERCOT. • ERCOT filed comments subsequently to clarify the language.

9. Working Groups • DSWG • Load acting as Resource (LaaR) Events (May 15 and June 23), NRR243, EILS Self-Provision Settlement Corrections and Other Issues – to be voted on in July • MCWG • Nodal Market Trial CMM Performance Discussion, Nodal Market Application of “e” Parameters, Third Party Credit Administration – Other Markets, NPRR147, First Priority Security Interest Agreement for CRRs, CRR Auction Credit Requirements, NPRR241 • PSWG • Goals and Charter approved unanimously • QMWG • 2011 Ancillary Service Methodology WMS Recommendations 9not taken up), GREDP Calculations and other Nodal Reliability Performance, Implementing NPRR214, QMWG TRIP, WGR RTPP Data for Nodal HSL and MET Data Update, June 23rd Disturbance Control Standard (DCS) Event, PRR776, Balancing Energy Service Capable Non-spin, Load Resource deployment

10. Working Groups • VCWG – no report • CMWG – no report • MWG– no report • QSTF – no report • GATF – no report • WCATF– no report

11. Upcoming/Continuing Discussion Points • Nodal Price Convergence with Zonal • Nodal Test Outcomes… review and recommend • Reconstitution of Potomac Economics Recommendations Task Force to Review 2009 State of the Market Report? • TRIP Report

12. WMS GOALS

13. QUESTIONS