The Federal Energy Regulatory Commission will accept comments until Feb. 19 on price formation in RTO and ISO energy and ancillary services markets.
“With proper price formation, the RTO/ISO would ideally not need to commit any additional resources beyond those resources scheduled economically through the market processes, and load would reduce consumption in response to price signals such that market prices would reflect the value of electricity consumption without the need to curtail load administratively,” the commission said in its notice (AD14-14).
“In reality, RTO/ISO energy and ancillary services market outcomes are impacted by a number of technical and operational considerations. … Notwithstanding the foregoing technical limitations and operational realities, the commission believes there may be opportunities for RTOs/ISOs to improve the energy and ancillary service price formation process.”
The commission held technical workshops on the subject Sept. 8 (uplift workshop); Oct. 28 (shortage pricing/mitigation workshop) and Dec. 9 (operator actions workshop). (See PJM Under Scrutiny at FERC Uplift Hearing.)
The commission’s notice solicits questions in 12 categories:
- Offer Caps
- Transparency
- Pricing Fast-Start Resources
- Settlement Intervals
- New Products to Incent Flexibility
- Operating Reserve Zones
- Uplift Allocation
- Market and Modeling Enhancements
- Shortage Prices
- Transient Shortage Events
- Interchange Uncertainty
- Next Steps
