VALLEY FORGE, Pa. — The PJM Market Implementation Committee will hold a special meeting June 29 to continue discussion about the process for approving fuel cost policies and redefining terms, including “market seller.”
The changes, which stem from an annual review of Manual 15, were on the MIC’s agenda for endorsement Wednesday, but after spending one and a half hours talking about them, members asked to continue to work the issue.
One of the topics of discussion was new language added to clarify that the “market seller is the entity that submits a cost-based offer and is responsible for maintaining all information necessary to calculate resource’s cost-based offer.”
Members said they wanted to make sure that any new definitions were consistent with the Tariff.
Catherine Mooney of Monitoring Analytics also proposed language changes on behalf of the Independent Market Monitor.
“The purpose of Manual 15 is to develop the primary input for market power mitigation. This is one of the Market Monitor’s primary responsibilities,” she said.
In a case where a market seller is an agent of the generation owner, it needs to have access to all of the information required to not only calculate but also support a cost-based offer, she said.
Mooney also introduced language that would clarify the Monitor’s authority in evaluating fuel cost policies.
More Flexible Parameter Limited Exception Process Approved
The committee, with two abstentions, endorsed a proposal to make the parameter limited schedule exception process more flexible.
“The most important goal is to solve the problem of inflexibility,” PJM’s Tong Zhao said. (See “Manual Changes to Detail Unit-Specific Operating Parameter Adjustment Process under CP,” PJM Operating Committee Briefs.)
The revisions allow generators to request an exception if they learn of a need after the Feb. 28 deadline. They also permit a temporary exception to be extended to a period or a persistent exception if the need arises after the deadline.
In addition, the changes give PJM and the Monitor more time to review requests and give their determinations to market sellers.
Retroactive Black Start Billing Charges Focus of Proposed Study
PJM’s Tom Hauske introduced a problem statement and issue charge designed to mitigate the potential for large, retroactive black start charges.
Currently, the Tariff does not address when the Monitor will review the costs for new units entering black start service outside of the annual revenue recalculation period.
A number of new units have recently entered black start service, many replacing retiring units. To ensure PJM had sufficient resources, most of these new units entered service before their initial capital costs and annual revenue requirements were approved by the Monitor — some with a lag of six months or longer.
That resulted in significant charges to load in April.
“We would all benefit from more transparency. … If you have these things under review for a period of time and they’re accumulating charges, we’d like to see how large that accumulation might be,” said Jeff Whitehead of Direct Energy. “If we could minimize it, that would be good. If we can’t, we need to at least understand what the liability is going to be.”
“The back charges were a shock to our members and clients,” added Carl Johnson of the PJM Public Power Coalition. “Even if we don’t know what the scope of that is going to be, just knowing it exists is helpful.”
“There are more coming,” Hauske replied. “We can come up with an estimate.”
Conference Call Set to Discuss Auction-Specific Bilateral Transactions
A special MIC conference call will be held June 24 to discuss proposed clarifications to auction-specific bilateral transactions.
Assistant General Counsel Jen Tribulski said the changes aim to preserve the physicality of the transactions and ensure members’ indemnification.
The new rules assign auction credits and bonus payments to the buyer, while the seller retains the obligation to perform. (See “PJM Proposes Clarifications to Bilateral Transactions,” PJM Market Implementation Committee Briefs.)
Members said they wanted more information on the clarifications.
Committee Endorses Two Problem Statements from Members
With little discussion, the committee unanimously approved:
- A problem statement and issue charge presented by Bruce Campbell of CPower to review the demand response registration submission deadline. (See “CPower Proposes to Study Necessity of DR Registration Submission Deadline,” PJM Market Implementation Briefs.)
- A problem statement and issue charge from Direct Energy’s Whitehead and Sharon Midgley of Exelon to discuss potential enhancements to the residual auction revenue rights process. (See “Exelon, Direct Energy Suggest Studying Residual ARR Process,” PJM Market Implementation Committee Briefs.)
— Suzanne Herel