PJM IMM Withdraws Complaint Over Capacity Sell Offer as Moot

The PJM Independent Market Monitor has filed at FERC to withdraw its complaint against the unnamed owner of an unnamed capacity unit which the IMM alleged was using modeling assumptions in its capacity sell offer that were inconsistent with the Minimum Offer Price Rule in the Reliability Pricing Model.

The IMM was concerned with what it considered the potential for depressed capacity prices as a result of the seller's offer.

The Market Monitor said that it, "has determined that no harm to the markets will result as a consequence of the [alleged] violation identified in the Complaint."

"The Complaint is therefore moot," the IMM said.

Take the IMM's statement for what you will, but Matters can only conceive two scenarios where the disputed sell offer would not result in the consequence feared by the IMM: (1) the sell offer would have cleared, and would not have been the marginal offer, had the offer been made at the IMM's desired level (therefore using the IMM offer would not have changed prices, nor did using a lower offer displace any other offers that would not have been displaced using the IMM level) or (2) the sell offer did not clear at the level as determined by the seller.

The Base Residual Auction closed yesterday; results are to be published later today.

The IMM further said that, "Although the Complaint is moot with respect to the 2012 BRA and the Sell Offer for Project X, the Market Monitor identifies significant issues in this proceeding affecting the administration of the MOPR that persist and require resolution. The Market Monitor has been actively discussing the issues raised in this proceeding with PJM and PJM stakeholders. The Market Monitor has been authorized to state that PJM agrees with the Market Monitor that additional direction concerning one or more of the standards applicable to unit specific offers subject to MOPR review is likely needed. We agree that non-discriminatory and effective MOPR standards are needed in order to safeguard the integrity and competitiveness of RPM. We are weighing our options, collectively and/or individually, about how best to present these issues for decision at the Commission in the very near term. We agree that resolution is needed well advance of the next RPM Base Residual Auction in May 2013."