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Texas PUC Staff Seek Comment On Whether Changes To ERCOT System-Wide Offer Cap Programs Are Needed
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Texas PUC Staff sought comments on the ERCOT Scarcity Pricing Mechanism and Emergency Pricing Program as part of a five-year review of the system-wide offer cap programs in ERCOT
The five-year review is to determine whether any changes are warranted, and 2026 marks the first five-year review
PUC Staff sought comment on the following:
Scarcity Pricing Mechanism (SPM)
a. The current Low System-Wide Offer Cap (LCAP) is $2,000 per MWh for energy offers and $2,000 per MW per hour for ancillary service (AS) offers. The current High System-Wide Offer Cap (HCAP) is $5,000 per MWh for energy offers and $5,000 per MW per hour for ancillary service offers. Do either of these values need to be updated? Why?
b. With the implementation of RTC+B, there is a difference between the day ahead (DAM) and real-time (RTM) system offer caps for both energy and AS. The DAM offer cap is $5,000 per MWh per hour, and the RTM offer cap is $2,000/MWh. Should this difference continue? Why?
c. Should any of the scarcity pricing mechanism features listed below be modified? Why?
i. Peaker net margin calculation
ii. LCAP trigger threshold
iii. Reimbursement for operating losses when the LCAP is in effect
2. Emergency Pricing Program (EPP)
a. Since its adoption in December 2023, ERCOT has never activated the EPP. Should any of the EPP features listed below be modified? Why?
i. The activation trigger for the EPP
ii. The Emergency Offer Cap
iii. The duration of the EPP
iv. The market notice specifications
v. The reimbursement for costs that exceed the ECAP
vi. The reporting requirements after the EPP has been activated
3. How should the Ancillary Service Demand Curves (ASDC) be modified to better reflect scarcity and improve economic efficiency?4
4. What credit risk concerns should the Commission consider if either the SPM or the EPP were to be adjusted, and how should existing credit obligations be recalibrated in response?
5. Are there any other topics the Commission should consider as part of this evaluation?
Project 59550
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August 21, 2026
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Copyright 2026 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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