ERCOT Reports Further $345 Million In Short Payments

March 1, 2021

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Reporting by Paul Ring • ring@energychoicematters.com

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ERCOT said in a market notice that Qualified Scheduling Entities (QSEs) and Congestion Revenue Right Account Holders (CRRAHs) that are owed monies from ERCOT on Settlement Invoices due for payout on March 1, 2021, will notice that the amount of funds transferred is short of the balance payable on the Settlement Invoices.

The net amount of short payments for Settlement Invoices due for payout on March 1, 2021 was $345 million

This brings total short payments From Feb. 26 and March 1 to $1.66 billion

For Settlement Invoices with payout dates of Friday, February 26, 2021, and Monday, March 1, 2021, as authorized under the authority granted to ERCOT by Commission order on February 21, 2021, in Project No. 51812, ERCOT utilized $800 million from CRR Auction revenue funds held by ERCOT and netted some Settlement Invoices to help protect the liquidity of the financial market in the ERCOT Region. ERCOT’s use of this iterative process resulted in Settlement Invoice adjustments for invoices dated February 26, 2021 or March 1, 2021. The resulting impact is that the short pay amounts are correct over the two day period but any one single day may have discrepancies. Accordingly, some adjustments may be necessary and miscellaneous invoices will be issued to reflect such adjustments, ERCOT said in the notice

The cumulative total amounts, including any necessary Invoice adjustments, represent the final allocation of short payments through Invoice payout date March 1, 2021.

ERCOT initiates the short payment procedure when a Market Participant fails to make a complete payment for Settlement Invoices. In accordance with ERCOT Protocol Section 9.19, ERCOT will draw from available Financial Security provided by short-paying Market Participants. Funds received from Financial Security will be allocated to short paid Invoice Recipients as soon as possible. Furthermore, ERCOT will deduct any applicable ERCOT Administrative fees, payments for Reliability-Must-Run (RMR) services, and the CRR Balancing Account from the amount received, and then reduce payments to all Invoice Recipients owed monies. The reductions will be made on a pro-rata basis of monies owed to each ERCOT creditor to the extent necessary to clear ERCOT's accounts on the payment date to ensure revenue neutrality for ERCOT.

Going forward, ERCOT will include the identity of short-paying Invoice Recipients and the dollar amount attributable to the Invoice Recipient pursuant to ERCOT Protocol Section 9.7.3. Furthermore, in a subsequent Market Notice to be issued on Wednesday, March 3, 2021, ERCOT will identify any remaining short-paying Invoice Recipients on Invoices with payout dates of February 26, 2021, and March 1, 2021.

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