Markets Report. Paul M. Sotkiewicz, Ph.D Chief Economist, Markets MC Webinar January 20, 2015 PJM 2015

Transcription

1 Markets Report Paul M. Sotkiewicz, Ph.D Chief Economist, Markets MC Webinar January 20, 2015

2 Executive Summary PJM Wholesale Cost for calendar year 2014 was $70.40/MWh, and increase of 47% and 33% over 2012 and 2013 respectively, primarily due to the increase energy prices in (Slides 4 & 5) Load-weighted average LMP: For 2014 was $53.15/MWh was the 5 th highest annual LMP on record, and the highest since 2008 ($71.13/MWh). (Slide 18) For December 2014 was $33.22/MWh, which is seasonally in-line compared to December 2012 ($30.60) and December 2013 ($37.55). (Slide 15) Has remained below $45/MWh since April, and below $40/MWh since July. (Slide 15) Part of the reason for continued lower LMPs since March, in addition to lower fuel prices, are lower weather driven loads (Slides 16-17) Starting in April 2014, Operating Reserve and total uplift charges are at the lowest levels since (Slides 7-9) Total CT hours with offers less than LMP has remained at or below 30% since April 2014 (Slide 10) 2

3 Executive Summary Over the past 3 months total cleared MWh of virtual bids (INCs and DECs) and UTCs are at the lowest levels ever. (Slide 31 and data appendix) UTC remain at only 24% of the August activity (Slide 29) FTR revenue adequacy for the month of December is 100%, and the Planning Year to date FTRs are also fully funded (Slides 33-36) MISO market-to-market payments from PJM, in spite increasing during Q2-Q versus Q2-Q4 2013, are at the second lowest level since (Slide 40 and data appendix) Synchronized Reserve and Regulation market costs have generally tracked with energy prices over time December 2014 Regulation costs declined to $9.86 million and Synchronized Reserve Costs increased $0.6 million respectively representing a 22% decrease and 14% increase in these costs from November (Slide 42-43) Collectively these costs represented 0.74% of total wholesale costs in

4 PJM Wholesale Cost 4

5 PJM Wholesale Cost - Other 5

6 Operating Reserve and Uplift 6

7 Monthly Operating Reserve Costs 7

8 Monthly Operating Reserve Costs - $/MWh Load 8

9 Monthly Uplift 9

10 Percent of Total CT Hours with LMP < Offer 10

11 Beginning in December 2008, the daily Balancing Operating Reserves (BOR) rate was replaced with six different BOR rates: RTO BOR for Reliability Rate, RTO BOR for Deviations Rate, East BOR for Reliability Rate, East BOR for Deviations Rate, West BOR for Reliability Rate, West BOR for Deviations Rate. Reliability rates are charged to all real-time load and exports, whereas deviation rates, as before, are charged only to real-time deviations. RTO rates are charged to the whole footprint, whereas East and West rate adders are charged based on location. 11

12 Reliability Balancing Operating Reserve Rates 12

13 Deviations Balancing Operating Reserve Rates 13

14 Energy Market LMP Summary 14

15 Load-Weighted Average LMP 15

16 The weather parameter shown in the following slide is a monthly sum of daily Heating Degree Days (HDD) and Cooling Degree Days (CDD). Degree days represent a deviation from a baseline temperature, in this case 60 degrees for HDD and 65 degrees for CDD. As temperatures get more extreme, colder or hotter, either HDDs or CDDs, respectively, will increase. Typically, winter months will only record HDDs, while summer months will only record CDDs. Shoulder months may have both HDDs and CDDs. Degree Days are calculated using a daily load weighting that weights values from stations in each TO zone according to the zone s contribution to the RTO peak on that day. Average values use data from 1998 to the most recent complete year, in this case, Averages include load data for all of TO zones in the current RTO footprint. 16

17 Historic Average Weather and Energy versus Current Month 17

18 Fuel Cost Adjusted LMP (Referenced to 1999 Fuel Prices) 18

19 LMP Price Posting Suspensions and Reruns In September 2014 the method for calculating LMP re-run intervals was changed to only include intervals that actually impacted LMP. 19

20 Energy Market Demand Response Summary 20

21 Demand Side Response Estimated Revenue *Capacity revenue prior to RPM implementation on estimated based on average daily ALM capacity credits and weighted average daily PJM capacity market clearing price. 21

22 Economic Demand Response Activity *Data for the last few months are subject to significant change due to the settlement window. 22

23 Total Registered MW in PJM's Economic Demand Response 23

24 Energy Market Virtual Activity Summary 24

25 INCs, DECs and Up-To-Congestion Transactions The following six charts depict trends in submitted and cleared virtual and up-to-congestion transactions, in terms of number and volume, into the PJM Energy Market. The first two of these charts show the submitted and cleared increment and decrement bids ( virtual transactions or virtuals ) and they are the same as what was previously being presented in this report. The two charts after them display the trends in submitted and cleared up-tocongestion transactions into the PJM Energy Market. The last two of these six charts combine the virtual and up-to-congestion transactions and show the sum of these two categories. To clarify what a bid or transaction is please consider the following example: An offer (increment, decrement or up-to-congestion) of 10 MW, valid for eight hours for a given day, is captured in the charts as eight submitted bids/transactions and 80 submitted MWh. If this offer fully clears for three of the hours it was submitted for, it shows in the charts as three cleared bids/transactions and 30 cleared MWh. 25

26 Virtual Bids (INCs & DECs) - Total Number) 26

27 Virtual Bids (INCs & DECs) - Total Volume 27

28 Up-To-Congestion Transactions - Total Number 28

29 Up-To-Congestion Transactions - Total Volume 29

30 INCs, DECs and Up-To-Congestion Transactions - Total Number 30

31 INCs, DECs and Up-To-Congestion Transactions - Total Volume 31

32 Energy Market Congestion and FTR Summary 32

33 FTR Revenue vs. FTR Target Allocation 33

34 Monthly FTR Payout 34

35 FTR Funding Period Surplus/(Underfunding) Payout December, 2014 $ 8,277, % 2014 $ (491,976,190) 80% $ 40,300, % 35

36 Planning Period FTR Payout 36

37 Energy Market Interchange/Seams Summary 37

38 Monthly Average MISO Interface Pricing 38

39 Monthly Average NYISO Interface Pricing 39

40 PJM-MISO Market-to-Market Coordination Settlement Negative M2M Credit represents PJM payment to MISO 40

41 Ancillary Service Market Summary 41

42 Regulation Costs 42

43 Synchronous Condenser and Synchronized Reserve Costs 43

44 Load Adjusted Synchronous Condenser and Synchronized Reserve Costs 44

45 DSR Participation in PJM Synchronized Reserve Markets 45

46 DSR Participation in PJM Regulation Markets 46

47 Regulation Market Daily Prices and Charges 47

48 Synchronized Reserve Market Daily Prices and Charges 48