transmission rights. 2 the markets energyforwardtransmissionrightsancillaryservices must run...

Transmission RightsTransmission Rights

2

The MarketsThe Markets

EnergyEnergyForwardForward

TransmissionTransmissionRightsRights

AncillaryAncillaryServicesServices

Must RunMust RunContractsContracts

EnergyEnergyOperatingOperatingReserveReserve

CapacityCapacityReserveReserve

ProcurementProcurement

FinancialFinancial

Real-timeReal-time

PhysicalPhysical

IMO - Administered MarketsIMO - Administered MarketsIMO - Administered MarketsIMO - Administered Markets

3

ParticipantParticipant

• The company or organization that is authorized to participate in the Financial Transmission Rights Market

• The company or organization that is authorized to participate in the Financial Transmission Rights Market

E.g., Company Light-BrightE.g., Company Light-BrightE.g., Company Light-BrightE.g., Company Light-Bright

4

UsersUsers

Users:

• The various people within a member company that are authorized to participate in auctions on behalf of their company.

Users:

• The various people within a member company that are authorized to participate in auctions on behalf of their company.

JoeJoeJoeJoeGregGregGregGreg

MikeMikeMikeMikeKimKimKimKim

From Company Light-BrightFrom Company Light-BrightFrom Company Light-BrightFrom Company Light-Bright

5

OntarioOntario

ManitobaManitoba

MichiganMichigan

QuebecQuebec

New YorkNew York

MinnesotaMinnesota

Interconnection FeaturesInterconnection Features

6

CongestionCongestion

Occurs when physical capability of the transmission system cannot meet market

requirements

Occurs when physical capability of the transmission system cannot meet market

requirements

7

OntarioOntario New YorkNew YorkNYNY

IntertieIntertieZoneZone

OntarioOntarioProxy Proxy

BusBus

External MarketExternal Market (New York Example)(New York Example)IMO-Administered MarketsIMO-Administered Markets

Import of Energy Into OntarioImport of Energy Into Ontario

Transfer of MWs from one market to the other is Transfer of MWs from one market to the other is achieved when both markets are navigated successfullyachieved when both markets are navigated successfully

MWs Imported to MWs Imported to OntarioOntario

MWs Exported MWs Exported from New Yorkfrom New York

8

Intertie Zone MCP: Offers/No Congestion

Intertie Zone MCP: Offers/No Congestion

MCP = 16MCP = 16Ontario

Import Scheduling Limit Import Scheduling Limit

$10$10

$22$22

$14$14

$12$12Intertie Zone

$10$10

$16$16

$14$14

$12$12

$22$22

$24$24

9

Intertie Zone MCP: Offers/CongestionIntertie Zone MCP: Offers/Congestion

Ontario MCP = 16Ontario MCP = 16Ontario

Import Scheduling Limit Import Scheduling Limit

$10$10

$22$22

$14$14

$12$12Intertie Zone

$10$10

$16$16

$14$14

$12$12

$22$22

$24$24

Intertie Zone MCPIntertie Zone MCP

1212

1414

16 - no congestion16 - no congestion

10

Intertie Zone MCP: Bids/No CongestionIntertie Zone MCP: Bids/No Congestion

Ontario

Scheduling Limit 400 MwScheduling Limit 400 Mw $10$10

$1000$1000

$500$500

$12$12Intertie Zone

$10$10

$16$16

$14$14

$12$12

$500$500

$1000$1000Dispatchable Load ServedDispatchable Load Served

Dispatchable Load Not ServedDispatchable Load Not Served

Boundary Entity Load Not Boundary Entity Load Not

ServedServed

MCP = 16MCP = 16

11

Intertie Zone MCP: Bids/Congestion

Intertie Zone MCP: Bids/Congestion

Ontario MCP = 16Ontario MCP = 16Ontario

Scheduling Limit Scheduling Limit

Intertie Zone

$10$10

$1000$1000

$500$500

$12$12

$10$10

$16$16

$14$14

$12$12

$500$500

$1000$1000

Intertie Zone MCPIntertie Zone MCP

Dispatchable Load ServedDispatchable Load Served

Dispatchable Load Not ServedDispatchable Load Not Served

1616

Dispatchable Load Not ServedDispatchable Load Not Served

500500

Dispatchable Load Not ServedDispatchable Load Not Served

10001000

Dispatchable Load Not ServedDispatchable Load Not Served

12

Bids and Offers in Intertie ZonesBids and Offers in Intertie Zones

$10$10

$1000$1000

$500$500

$12$12

$10$10

$16$16

$14$14

$12$12

$500$500

$1000$1000

$16$16

Bids Offers

13

Settlement Price for Withdrawals and Injections

Settlement Price for Withdrawals and Injections

Zone Price Uniform Market Clearing Price in Ontario

ICP

Pre Dispatch

Real Time MCPICP +

Intertie Energy Price

-

14

Price ($/MW)

Quantity ((MW))

Real Time MCP Calculation

ExportsPrimary Demand

Fixed Load Dispatchable Load

MMCP

-MMCP

MCP

Dispatchable Generation

Available to algorithm to optimize

ImportsSelf-Scheduling

Fixed Generation

ExportsNon Dispatchable Load

15

Time StructureTime Structure

• Period of time for which transmission rights are being sold.

• Three components:• Duration for which rights are valid

• Days of the week

• Hours of the day

• Period of time for which transmission rights are being sold.

• Three components:• Duration for which rights are valid

• Days of the week

• Hours of the day

16

Time Structure - Business RulesTime Structure - Business Rules

• Times are based on a 24 hour clock and are defined in “hour ending” units

• Times correspond to EST (throughout the year)

• Bids for portions of time within a time structure will not be accepted.

• Times are based on a 24 hour clock and are defined in “hour ending” units

• Times correspond to EST (throughout the year)

• Bids for portions of time within a time structure will not be accepted.

17

12 Hour 1

Hour 2

3

4

567

11

10

9

8

Time StructureTime Structure

18

Transmission PathsTransmission Paths

A transmission path specifies the injection and withdrawal zones for transmission and is designated by abbreviation pairs.

A transmission path specifies the injection and withdrawal zones for transmission and is designated by abbreviation pairs.

ON - NYON - NYOntario is theinjection zone

New York is thewithdrawal zone

19

How Are TRs Acquired?How Are TRs Acquired?

TransmissionTransmissionRightsRights

Long-termLong-termTR AuctionsTR Auctions

Short-termShort-termTR AuctionsTR Auctions

20

Long-term and Short-term TRsLong-term and Short-term TRs

Month

Mw

Intertie upper limit forecast by IMO

21

Long-term and Short-term TRsLong-term and Short-term TRs

Month

Mw

Intertie upper limit forecast by IMO

Long Term TR

Short Term TR

22

Long-term and Short-term TRsLong-term and Short-term TRs

Month

Mw

Intertie upper limit forecast by IMO

Short Term TR

23

Long-term and Short-term TRsLong-term and Short-term TRs

Month

LT 1

MW

Intertie upper limit forecast by IMO

24

Long-term and Short-term TRsLong-term and Short-term TRs

Month

LT 2

LT 3

LT 4

LT 1

MW

ST

25

Long-term and Short-term TRsLong-term and Short-term TRs

Month

MW

ST

26

Long-term and Short-term TRsLong-term and Short-term TRs

Month

MW

ST

27

RoundsRounds

A round is an attempt to sell a product within an auction. Products can be sold in multiple attempts rather than all at once.

A round is an attempt to sell a product within an auction. Products can be sold in multiple attempts rather than all at once.

Round 1Round 1Round 1Round 1 Round 2Round 2Round 2Round 2 Round 3Round 3Round 3Round 3

Auction: LT-May all hours all daysAuction: LT-May all hours all daysAuction: LT-May all hours all daysAuction: LT-May all hours all days

28

Round - ExampleRound - Example

Auction: LT- May all hours all daysTRs available = 1000 MW

20% of TRs available soldRound Fraction = 0.20

800 MW Remain

50% of Total/Remaining soldRound Fraction = 0.50

400 MW Remain

100% of Total/Remaining soldRound Fraction = 1.00

No MW Remain

Round 1

Round 2

Round 3(Final)

29

Long Term Sub AuctionsLong Term Sub Auctions

Month

MW

ST

LT SA1

30

Long Term Sub AuctionsLong Term Sub Auctions

Month

MW

ST

LT SA1

LT SA1

STSTSTST

31

LT Sub Auctions and RoundsLT Sub Auctions and Rounds

Month

MW

LT SA1 R1

LT SA1 R2

LT SA1 R3

ST

32

BidBid

A bid in the TR Auction System consists of three key pieces of information:

A bid in the TR Auction System consists of three key pieces of information:

Transmission Path

Quantity

Price/MW

33

How Are TRs Acquired?How Are TRs Acquired?

TransmissionTransmissionRightsRights

Long-termLong-termTR AuctionsTR Auctions

Short-termShort-termTR AuctionsTR Auctions