PUCT Reverses ERCOT Resettlement Related to De-energized Buses

The PUCT yesterday granted an appeal brought by two financial marketers concerning ERCOT's decision to resettle Operating Days December 1, 2010 through February 1, 2011, reversing the ERCOT Board decision to resettle the LMPs and settlement price points (Docket 39433).

As previously reported, the resettlement related to LMPs and Settlement Point Prices for de-energized electrical buses.

The Commission agreed with Longhorn Energy LP and West Oaks Energy LLC that there was no software or data error (the threshold for resettlement) which caused the originally settled prices.

The PUCT also reiterated its dislike of resettlements, due to their negative impact on market expectations and certainty.

Commissioner Kenneth Anderson stressed that the reversal of the resettlement was not an endorsement of any market participant behavior with respect to the de-energized electrical buses, and also reiterated that PUCT rules provide that market participants are obligated to report to ERCOT any identified provision in the ERCOT procedures that produces an outcome inconsistent with the efficient and reliable operation of the ERCOT-administered markets.

Anderson further noted that the substantive rules provide that market participants shall not engage in activities and transactions that create artificial congestion or artificial supply shortages, artificially inflate revenues or volumes, or manipulate the market or market prices in any way.