By Amanda Durish Cook

MISO is proposing new Tariff changes that would require a market participant to put up additional collateral — or face a suspension from trading — when it exhibits undue risk to the RTO’s wholesale market.

The proposal is separate from actions MISO has already taken to safeguard its financial transmission rights market. The RTO last month filed with FERC to apply stiffer rules to FTR traders, including a 5-cent/MWh minimum collateral requirement and a mark-to-auction valuation (ER20-73).

“These changes will cover the entire market,” MISO credit analyst Brian Brown explained at Thursday’s meeting of the Market Subcommittee.

Brown said the Tariff language will focus on evidence of default, manipulation and unreasonable risk to the market and would allow MISO to request additional collateral when it perceives “unreasonable credit risk” from a market participant. He said the RTO prefers to step up collateral requirements “rather than ban a risky or bad actor.”

The proposed changes would also allow MISO to reject applications from new and former market participants and those that have an uncured financial default in the RTO’s market and attempt to rejoin under a different name.

The changes would additionally require current and prospective market participants to provide more specifics in their annual certification forms, including information about any past defaults, bankruptcies, dissolutions, mergers or acquisitions, and any investigations.

“In reading our Tariff, we found MISO currently does not have explicit authority to act in order to protect the market. We have implicit authority, but we want to have explicit authority in these issues,” Brown said. “We just want to be able to protect the market when it’s threatened.”

MISO’s legal team has said it is targeting a filing in December.

Gabel Associates’ Travis Stewart last month said the first draft of the proposed Tariff language was vague and affords MISO with a “substantial amount of judgment.” He asked for a more descriptive proposal.

But Brown said MISO needs the latitude to be able to address a variety of risks to the market. However, he said the RTO has opened the proposal to stakeholder feedback through Nov. 21.