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Price Validation and Correction

Price Validation and Correction. Resmi Surendran Manager, Market Analysis. Protocol - When Prices Are Final.

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Price Validation and Correction

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  1. Price Validation and Correction Resmi Surendran Manager, Market Analysis CSWG/RCWG 05/11/2012

  2. Protocol - When Prices Are Final 4.5.3(4)All DAM LMPs, MCPCs, and Settlement Point Prices are final at 1000 of the next Business Day after the Operating Day. After DAM LMPs, MCPCs, and Settlement Point Prices are final, if ERCOT determines that prices are in need of correction, it shall notify Market Participants and describe the need for such correction. DAM LMPs, MCPCs, and Settlement Point Prices cannot be changed unless the ERCOT Board finds that the DAM LMPs, MCPCs, or Settlement Point Prices are significantly affected by a software or data error. 6.3(4) All Real-Time LMPs, SASM MCPCs, and Real-Time Settlement Point Prices are final at 1600 of the next Business Day after the Operating Day. After Real-Time LMPs, SASM MCPCs, and Real-Time Settlement Point Prices are final, if ERCOT determines that prices are in need of correction, it shall notify Market Participants and describe the need for such correction. Real-Time LMPs, SASM MCPCs, and Real-Time Settlement Point Prices cannot be changed unless the ERCOT Board finds that the Real-Time LMPs, SASM MCPCs, or Real-Time Settlement Point Prices are significantly affected by a software or data error. ERCOT CSWG/RCWG Meeting

  3. Protocol – How Prices are Corrected 6.3 (3)(a) If it is determined that the Real-Time Settlement Point Prices are erroneous and correcting such prices will not affect the Base Points that were received by Qualified Scheduling Entities (QSEs), then ERCOT shall correct the prices before the prices are considered final in paragraph (4) below. 6.3 (3)(b) If it is determined that correcting the Real-Time Settlement Point Prices will affect the Base Points that were received by QSEs, then ERCOT shall correct the prices before the prices are considered final in paragraph (4) below and settle the Security-Constrained Economic Dispatch (SCED) executions as failed in accordance with Section 6.5.9.2, Failure of the SCED Process. 6.3 (3)(c) If the Base Points received by QSEs are inconsistent with the Real-Time Settlement Point Prices, then ERCOT shall consider those Base Points as due to manual override from the ERCOT Operator and settle the relevant Settlement Interval(s) in accordance with Section 6.6.9, Emergency Operations Settlement. 6.5.9.2 (2) For intervals that the SCED process fails to reach a solution, then the LMPs for the interval for which no solution was reached are equal to the LMPs in the most recently solved interval. For Settlement Intervals that the Real-Time Settlement Point Prices are identified as erroneous and ERCOT sets the SCED intervals as failed in accordance with paragraph (3)(b) of Section 6.3, Adjustment Period and Real-Time Operations Timeline, then the LMPs for the failed SCED intervals are equal to the LMPs in the most recently solved SCED interval that is not set as failed. ERCOT shall notify the market of the failure by posting on the MIS Public Area. ERCOT Board Meeting

  4. Price Correction Schemes and Timelines among ISOs Source: http://www.caiso.com/Documents/Agenda_Presentation-MarketPerformance_PlanningForumJan26_2012.pdf ERCOT CSWG/RCWG Meeting

  5. Reasons for Price Corrections Source: http://www.caiso.com/Documents/Agenda_Presentation-MarketPerformance_PlanningForumJan26_2012.pdf ERCOT CSWG/RCWG Meeting

  6. Methods to Correct Prices Source: http://www.caiso.com/Documents/Agenda_Presentation-MarketPerformance_PlanningForumJan26_2012.pdf ERCOT CSWG/RCWG Meeting

  7. ERCOT Historic Price Corrections ERCOT CSWG/RCWG Meeting

  8. ERCOT Price Validation Tool (PVT) Price Validation is done for: • DAM • Immediately after each DAM execution. • For each hour of the next Operating Day. • SCED • Automatically executed at real time. • For each SCED Interval and each Settlement Interval. • SASM • Automatically executed after each SASM run. • For each hour in the SASM. ERCOT CSWG/RCWG Meeting

  9. Core Price Validation Tests ERCOT CSWG/RCWG Meeting

  10. Core Price Validation Tests ERCOT CSWG/RCWG Meeting

  11. Core Price Validation Tests (cont’d) ERCOT CSWG/RCWG Meeting

  12. Core Price Validation Tests (cont’d) ERCOT CSWG/RCWG Meeting

  13. Price Validation Statistics Note: the above statistics are based on OD 5/8/12 snapshot. ERCOT CSWG/RCWG Meeting

  14. Price Validation/Correction Process • Price Validation Team performs the following daily checks to identify potential pricing issues: • Error/Warning flags from automated daily Price Validation Reports • CRR/PTP Payout spike(s) • Price trends, congestion pattern and market convergence • Outages on heuristic table mapping • If a potential pricing issue identified: • Upper management is notified • A price investigation market notice is sent out through • Price investigation is immediately conducted • A price correction may be proposed by the team • If a price correction is approved internally by ERCOT managers: • A price correction market notice is sent out through • Price correction data is prepared and posted by deadline • Price corrections that past deadline are brought to Board ERCOT CSWG/RCWG Meeting

  15. Types of Errors for Previous Price Corrections ERCOT CSWG/RCWG Meeting

  16. Types of Errors for Previous Price Corrections ERCOT CSWG/RCWG Meeting

  17. Types of Errors for Previous Price Corrections ERCOT CSWG/RCWG Meeting

  18. Types of Errors for Previous Price Corrections ERCOT CSWG/RCWG Meeting

  19. Types of Errors for Previous Price Corrections ERCOT CSWG/RCWG Meeting

  20. Types of Errors for Previous Price Corrections ERCOT CSWG/RCWG Meeting

  21. Why Is Price Correction Needed for Planned Events • The calculation of Real Time Market Settlement Point Prices (SPPs) was Base Point weighted until the implementation of NPRR 326 & 355 on Feb 24, 2012. Even if everything went perfectly during a planned event, a price correction might still be needed. • The calculation of Real-Time Price for the Energy Metered for each Resource (RTRMPRs ) remains Base Point weighted. Consequently price corrections may still be needed for future planned events even if they are accomplished perfectly. • During planned events, SCED inputs may be stale or missing, or Base Points may not be telemetered to Market Participants due to data transfer issues. Consequently SCED LMPs and Base Points can be incorrect or inconsistent with what Market Participants have received. Price corrections are needed for such cases as well. ERCOT Board Meeting

  22. Types of Data Errors for Previous Price Corrections • Input data error • Incorrect/incomplete cost data, SF data, EBNRT, SPS, monitor flag • Stale/incorrect GTBD or telemetry • Incomplete list of de-energized buses • Dropping constraints • Output data error • Data transfer issues resulting in Base Points not being telemetered to Market Participants • Incorrect/incomplete data transfer • Price recalculation error • Software error • MMS defects • System failure infrastructure • Un-planned outages (Systems, Applications, Databases, ICCP telemetry) • Planned outages (Site failovers, Software releases) ERCOT CSWG/RCWG Meeting

  23. FYI • All market notices on price investigation and corrections can be found at: http://lists.ercot.com/scripts/wa-ercot.exe?A0=NOTICE_SETTLEMENTS • NPRR456, Posting of Heuristic Table • Database Load Schedule: http://www.ercot.com/gridinfo/transmission/opsys-change-schedule.html ERCOT CSWG/RCWG Meeting

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