Texas PUC Staff Propose Questions, ERCOT Updates For Energy-Only Review

Staff of the Texas PUC have filed for Commissioners' consideration proposed questions to be issued for comment in the PUC's project to consider energy-only market efficiency and improvements

Staff proposes that interested parties provide comment on the price-formation concerns and proposed solutions contained in a report filed by NRG and Calpine, with Staff specifically proposing the following questions:

1. What, if any, inefficiencies exist in the ERCOT energy-only market design? What, if any, factors are interfering with economically-efficient price formation and the sustainability of the energy-only market?

2. Are the recommendations proposed in the Report valid approaches to correct for any inefficiencies? Which of the proposed changes should be implemented, and why? On what timeline?

3. What other improvements, if any, should be made to support price formation within the energy-only framework?

Staff also proposes that ERCOT file reports in this project that address the issues listed below. Staff anticipates a Commission discussion with ERCOT at the June 7, 2017 Open Meeting on the expected reasonable completion date of the reports.

1. Provide a status update on recent changes, if any, made to:

a. ERCOT's transmission planning methodology and assumptions;

b. Assumptions and procedures used to determine the need to issue a RUC instruction or commit an RMR resource to support local reliability or for system-wide capacity; and

c. Out-of-market operator actions and associated pricing rules.

2. Comment on the need and/or cost of introducing a local reserve product or local operating reserve demand curves in conjunction with real-time co-optimization.

3. Provide an estimate of the implementation time and cost of incorporating marginal losses into dispatch and pricing.

Project No. 47199