Calpine Seeks Approval of Voluntary Mitigation Plan in Texas

Calpine Corporation, on behalf of itself and its generation subsidiaries operating in the ERCOT wholesale market, has petitioned the Public Utility Commission of Texas for approval of a proposed Voluntary Mitigation Plan (VMP) which would govern Calpine's participation and operations in the ERCOT Day-Ahead and Real-Time markets (Docket 40545).

Unlike Voluntary Mitigation Plans recently proposed by other generators, PUCT Staff did not join in petitioning for approval of the plan as proposed by Calpine. Calpine stated that it has met several times with Commission Staff and the IMM to discuss a voluntary mitigation plan for Calpine, but no agreement could be reached.

Under the VMP, in the real-time market, Calpine could offer energy from up to 10 percent of its capacity at prices up to and including the system-wide offer cap.

In the real-time market, Calpine could offer energy from up to 15 percent of its capacity at prices up to and including the low system offer cap.

Calpine would offer energy from the remaining 75% of its capacity, except for capacity offered as Responsive Reserve Service, Up-regulation Service or Non-Spin Reserve Service, at no higher than:

[(Incremental Heat Rate * (Fuel Index Price+$0.51/MMBtu)) + Variable O&M + S02 Emissions Cost + NOx Emissions Cost + Fees] + $50

The two-step mitigation methodology provided for in ERCOT Nodal Protocols § 6.5.7.3 would apply to all Calpine offers under the VMP.

In the Day-Ahead Market, Calpine would be permitted to offer at prices up to and including the system-wide offer cap.

The VMP would have no automatic end date but could be terminated by Calpine or the Commission on three business days' notice.