RPM 201 Resource Participation in PJM Capacity Market

Transcription

1 RPM 201 Resource Participation in PJM Capacity Market PJM 2017

2 Agenda Auction structure and key activity timelines Must offer, Offer Caps, MOPR Demand Response Energy Efficiency Commercial Aggregation Sell offers and Buy Bids Commercial Aggregation Seasonal CP Sell Offers Transactions in erpm PJM

3 Objectives At the conclusion of this training you will be able to. Describe the RPM auction timeline and key activities Define the requirements for a DR/EE sell offer plan Describe the method to construct a commercial aggregate Describe the construction of RPM sell offers and buy bids Describe the method to participate as a seasonal CP resource Differentiate bilateral transaction types PJM

4 Auction Structure and Key Activities PJM

5 RPM Structure 3 Years 20 months May 10 months May be scheduled at any time prior to DY Sept July 3 months Feb. June 1 May 31 EFORd Fixed Delivery Year Base Residual Auction Conditional Incremental Auction First Incremental Auction Second Incremental Auction Third Incremental Auction Ongoing Bilateral Market

6 Auction Structure and Key Activities General PJM

7 Auction Schedule RPM Auction schedule posted at Details major activities and deadlines for upcoming auctions Major Activities also listed in PJM Manual 18 Section 5.2 Supplemental auction reminders ed to participants PJM

8 RPM Auction Schedule PJM

9 Major Activities - General PJM posts auction planning parameters FEB01 prior to BRA, 30 days prior to incremental auctions Auction Open, Close and Posting of results Auctions generally open at 0001 hrs EPT on Monday and close at 1700 hrs EPT on Friday Results generally posted on Friday following auction close at 1600 hrs EPT PJM

10 Auction Structure and Key Activities Generation PJM

11 Major Activities - Generation Must-Offer Exception Requests Minimum Offer Price Rule (MOPR) Exception Requests Market Seller Offer Cap (MSOC) nomination PJM

12 Major Activities - Generation Must-Offer Exception Requests Requests are sent to PJM and Market Monitor Auction specific Reasons Documented pending retirement Significant physical operational restrictions (long-term or permanent) ongoing regulatory proceeding (e.g. environmental restrictions) Cleared prior auction/ delayed commercial operation date Reference: OATT Attachment DD Section 6.6 PJM

13 Major Activities - Generation Must-Offer Exception Requests Activity Preliminary must-offer exception for reason of deactivation Final must-offer exception for reason of deactivation Must-offer exception for other than deactivation IMM provides determination on must offer exception Capacity Market Sellers notify PJM/IMM of agreement with IMM determination on must offer exception PJM provides determination on must offer exception Capacity Market Seller notifies PJM/IMM of intent to exercise approved exception Deadline SEPT01 prior to BRA, 240 days prior to IA DEC01 prior to BRA, 120 Days prior to IA 120 days prior to auction 90 days prior to auction 80 days prior to auction 65 days prior to auction 65 days prior to auction PJM

14 Major Activities - Generation Minimum Offer Price Rule (MOPR) Exception Requests Requests are sent to PJM and Market Monitor Auction specific Competitive Entry, Self-Supply, Unit-Specific Absent approved exception, MOPR floor price is Net Asset Class Cost of New Entry (CONE) Approved exception removes floor price requirement Reference: OATT Attachment DD Section 5.14 (h) PJM

15 Major Activities - Generation Minimum Offer Price Rule (MOPR) Exception Requests Activity PJM posts preliminary MOPR screen prices Capacity Market Sellers submit MOPR exemption request IMM provides determination on MOPR exemption request PJM provides determination on MOPR exemption request Participant commits to MOPR price to be used (Unit Specific Request Only) Deadline 150 days prior to auction 135 days prior to auction 45 days following request 65 days following request 5 days following PJM determination PJM

16 Major Activities - Generation Market Seller Offer Cap (MSOC) nomination Participants notify PJM/IMM of desired MSOC (default/unit specific) Default CP MSOC is Net CONE * Balancing Ratio Default Base MSOC is ACR minus net revenues MSOC requests submitted via RPM/ACR system hosted by Market Monitor Absent participant specification, default MSOC values apply Reference: OATT Attachment DD Section 6.4 PJM

17 Major Activities - Generation Market Seller Offer Cap (MSOC) nomination Activity Submit sell offer cap data into the RPM/ACR system IMM provides determination on MSOC through RPM/ACR system Capacity Market Sellers notify PJM/IMM of agreement with IMM on MSOC determination PJM notifies participant/imm of determination on MSOC Deadline 120 days prior to auction 90 days prior to auction 80 days prior to auction 65 days prior to auction PJM

18 Demand Response and Energy Efficiency resources are subject to the Minimum Offer Price Rule (MOPR). a) True b) False PJM

19 BRA Must Offer Exception requests for a generator with an off-system sales commitment must be submitted by a) 01SEPT b) 01JAN c) 01DEC d) 01JUN PJM

20 Auction Structure and Key Activities Demand Response PJM

21 Major Activities - Demand Response DR Pre-registration DR Sell Offer Plan Officer Certification DR Set-up in erpm PJM

22 Major Activities - Demand Response Activity PJM posts the Zones of concern DR Pre-registration for FRR Capacity Plan DR Plan Template and Officer Certification for FRR Capacity Plan DR Pre-registration Window opens DR Pre-registration Window closes DR Setup Window opens DR Sell Offer Plan and Officer Certification DR Setup Window closes Deadline December 1 st prior to BRA As posted on RPM schedule 15 business days prior to FRR capacity plan due As posted on RPM schedule As posted on RPM schedule As posted on RPM schedule As posted on RPM schedule Friday prior to auction open PJM

23 DR Sell Offer Plan Submittal DR Sell Offer Plans must be submitted via to DR Sell Offer Plan Templates are posted for each Delivery Year under the Demand Resource Materials section at PJM

24 DR Sell Offer Plans All CSPs offering into an RPM Auction must provide to PJM a comprehensive DR Sell Offer Plan that encompasses both existing and planned DR A DR Sell Offer Plan documents the total DR Sell Offer quantities in a zone/sub-zone that a CSP intends to offer into an RPM Auction Total DR Sell Offer quantities would be comprised of: Existing DR as determined by pre-registration process Planned DR as indicated by documentation requirements for planned resources DR Sell Offer Plan requirements are found in Attachment C of Manual 18 PJM

25 Zones of Concern Zones/LDA pre-identified by PJM as areas for which total DR cleared quantities in recent auctions appear unreasonably excessive A CSP Sell Offer Threshold is determined for each CSP in the Zones of Concern and is stored under the DR Historical Data tab as the Higher of Max Registered or Cleared MW Sell Offer quantities in excess of the CSP Sell Offer Threshold will require site-specific information Further details can be found in the DR Sell Offer template PJM

26 DR Sell Offer Plans and Updated Template DR sell offer plan template has been updated such that the CSP must apportion the total MW quantity that it intends to sell into the auction for each zone/sub-zone into MW quantity it intends to offer as Annual CP MW quantity it intends to offer as Summer-Period DR MW quantity that it intends to use as part of an Aggregate Resource Sum of the 3 components cannot exceed the total nominated value The CSP is not locked into the allocation of the sell offer plan Final allocation is specified by CSP on the DR set-up screen PJM

27 DR Sell Offer Plans Planned MWs are identified by the CSP in the Planned DR Details section Applies only to those zone/subzones identified by PJM as requiring site-specific information if CSP s total sell offer MWs exceeds their CSP sell offer threshold for such zone/sub-zone Existing MWs as identified by CSP through pre-registration process in erpm system Allocation cannot exceed total nominated value Total Nominated DR Value represents the maximum MW amount that the CSP intends of offer for the zone/sub-zone PJM

28 2020/2021 DR Sell Offer Plan Template Zone or Sub-Zone Existing Nominated DR Value (ICAP MWs)* Planned Nominated DR Value (ICAP MWs) Total Nominated DR Value (ICAP MWs) Total Nominated DR Value to be Offered as Annual CP (ICAP MWs) ** Total Nominated DR Value to be Offered as Summer CP (ICAP MWs) ** Total Nominated DR Value to be included in an Aggregate Resource (ICAP MWs) ** JCPL PECO TOTAL Source: delivery-year.ashx PJM

29 Officer Certification Form Accompanies DR Sell Offer Plan Required whether selling existing or planned MWs Officer attests that: Has reviewed the DR Sell Offer Plan and information supplied to PJM in support of plan is true and correct as of the date of the certification. The company fully intends to physically deliver cleared quantities associated with the Plan through DR registrations by the delivery year. PJM

30 DR Set-Up in erpm Four Screens Pre-Registration Confirmation Participants are provided a list of their current registrations and select those they plan to contract with for the future Delivery Year DR Existing Setup Participants allocate the confirmed MW from Pre-Registration to individual DR Resources within each zone/sub-zone DR Planned Setup Participants submit their Planned MW by zone/sub-zone. Upon approval from PJM, participants then allocate those MW to individual DR Resources DR Historical Data Screen provides historical DR data for use in the new DR Sell Offer Plan Template PJM

31 DR Pre-Registration Confirmation Participants are provided a list of their current registrations confirmed in the elrs system Includes/excludes registrations involved in CSP switches for that Delivery Year Participants select those registrations that they reasonably expect to have under contract for the future Delivery Year The selected registrations will form the basis of their Existing DR to offer in the auction Must be completed during auction Pre-Registration window PJM

32 DR Pre-Registration Confirmation Select all registrations you reasonably believe to contract with in future Delivery Years PJM

33 Existing DR Setup The DR Existing Setup tab is used by participants to allocate any Existing Available MWs to their confirmed DR resources during the DR setup window Confirmation of DR resources must be completed under the Resource Confirmation tab before any MWs can be allocated to that resource Aggregate Resource Name will be populated for resources that are modeled as part of an aggregate resource If a new resource needs to be modeled or a current resource needs to be updated, please the rpm_hotline@pjm.com PJM

34 Existing DR Setup Participants are provided the following data grouped by Zone/LDA Pre-Registration Existing MW = Sum of confirmed sites in Pre-Registration tab Committed MW = Sum of DR commitments for auction Delivery Year Existing Available MW = Pre-Registration Existing MW Committed MW A list of all modeled DR resources along with their CP capability Annual DR that is CP Capable can submit both a CP and Base Sell Offer Resources modeled as Base DR will only be eligible to submit Base Sell Offers If Existing Available MW is positive, participants Enter the allocated MW amount by clicking on the blue text under Existing MW to Offer column The Coupled Name column has been removed (starting in the 18/19 delivery year) and coupling is now done in the Buy & Sell tab during the auction offer window For more information on coupling please see: Must be completed during the auction DR Setup Window PJM

35 2020/2021 DR Sell Offer Plan Template Zone or Sub-Zone Existing Nominated DR Value (ICAP MWs)* Planned Nominated DR Value (ICAP MWs) Total Nominated DR Value (ICAP MWs) Total Nominated DR Value to be Offered as Annual CP (ICAP MWs) ** Total Nominated DR Value to be Offered as Summer CP (ICAP MWs) ** Total Nominated DR Value to be included in an Aggregate Resource (ICAP MWs) ** JCPL PECO TOTAL Source: delivery-year.ashx PJM

36 Updated erpm Screens DR Existing Setup DR Existing Setup screen: Existing MWs allocated to individual DR resources by season Zone LDA Pre-Registration Existing MW Committed MW Allocated MWs cannot be greater than Existing Available MW Existing Available MW Resource Name Season Existing MW to Offer PECO EMAAC PJMTST PECO DR Annual 30.0 Summer 10.0 Sub-Total 40.0 JCPL EMAAC PJMTST JCPL DR Annual 50.0 Summer 25.0 JCPL EMAAC PJMAGG JCPL DR Annual 20.0 Sub-Total 95.0 PJM

37 Planned DR Setup Upon approval of the DR Sell Offer Plan, participants can allocate the planned MW amount they wish to submit in each Zone/LDA for the auction Enter the allocated MWs by clicking on the blue text under the Planned MW to Offer column Zone/LDA allocated MWs cannot exceed the Approved MWs The Credit Standing, MPCE, and Credit Requirement columns have been removed since participants will not be designating the product type of their Planned MW until they submit their sell offer during the auction sell offer window PJM has posted a Pre-Auction Credit Calculator to help participants calculate their own preauction credit: Must be completed during the auction DR Setup Window PJM

38 Updated erpm Screens DR Planned Setup DR Planned Setup screen: Existing MWs allocated to individual DR resources by season. The Credit Requirement for the Summer season will use the same rate as Annual, but multiplied by the number of days in the season divided by the total days in the Delivery Year. Zone LDA Planned MW Approved MW Allocated MWs cannot be greater than Existing Available MW Credit Standing Resource Name Season Pre-Auction Credit Rates for the 2020/2021 BRA are shown in the appendix Planned MW to Offer Credit Requirement PECO EMAAC Posted PJMTST PECO DR Annual 15.0 $ 525, Summer 5.0 $ 87, Sub-Total 20.0 $ 612, JCPL EMAAC Posted PJMTST JCPL DR Annual 10.0 $ 350, Summer 5.0 $ 87, JCPL EMAAC Posted PJMAGG JCPL DR Annual 10.0 $ 350, Sub-Total 25.0 $ 787, PJM

39 DR Historical Data in erpm PJM

40 An officer certification form only needs to be submitted if you are selling planned DR MW. a) True b) False PJM

41 The DR Pre-registration process identifies which type of customers in your DR plan a) Planned b) Existing c) Capacity Performance d) Base PJM

42 If you are selling planned MW in an identified Zone of Concern, where in erpm can you find numbers to calculate the CSP sales threshold? a) DR Existing Setup Tab b) DR Planned Setup Tab c) Pre-Registration Confirmation Tab d) DR Historical Tab PJM

43 Auction Structure and Key Activities Energy Efficiency PJM

44 Major Activities - Energy Efficiency (EE) EE Measurement & Verification Plan Updated EE Measurement & Verification Plan EE Set-up in erpm PJM

45 Energy Efficiency M&V Plan Plans due 30 days prior to start of auction Must submit updated plan even if resources were part of an approved M&V report from a previous delivery year M&V Requirements described in PJM Manual 18B EE M&V and nominated value templates are on PJM Website at PJM

46 Energy Efficiency M&V Plan PJM

47 Eligible Installation Periods 2019/2020 DY and Beyond Auction Eligible Installation Period BRA 1st Incremental 2nd Incremental 3rd Incremental DY-1, DY-2, DY-3, DY-4 DY-1, DY-2, DY-3 DY-1, DY-2 DY-1 PJM

48 Existing Energy Efficiency Setup Allocate Existing Available MW by Zone/LDA/Installation Period to your modeled Energy Efficiency Resources To qualify as existing, an EE resource must be part of an approved post-installation M&V report Updated post-installation reports are required for each successive delivery year that the EE resource is offered PJM

49 Updated erpm Screens EE Existing Setup EE Existing Setup: Existing MWs allocated to individual EE resources by season. Show the sub-totals by Zone/LDA rather than by Zone/LDA/Installation Period. Zone LDA Installation Period Post-Installation Existing MW Committed MW Existing Available MW Resource Name Season Existing MW to Offer PECO EMAAC 2016/ PJMTST PECO EE J16M17 Annual 2.0 Summer 1.0 PECO EMAAC 2017/ PJMTST PECO EE J17M18 Annual - Summer - PECO EMAAC 2018/ PJMTST PECO EE J18M19 Annual - Summer - PECO EMAAC 2019/ PJMTST PECO EE J19M20 Annual - Summer - Sub-Total PJM

50 Planned Energy Efficiency Setup Allocate approved Planned MW by Zone/LDA/Installation Period to your modeled Energy Efficiency Resources Planned resources have a collateral requirement PJM will post a calculator to help participants calculate their own pre-auction credit requirements Participants are responsible for ensuring they have sufficient collateral for their Planned MW sell offers PJM

51 Updated erpm Screens EE Planned Setup EE Planned Setup: Planned MWs allocated to individual EE resources by season. The Credit Requirement for the Summer season will use the same rate as Annual, but multiplied by the number of days in the season divided by the total days in the Delivery Year. Pre-Auction Credit Rates for the 2020/2021 BRA are shown in the appendix PJM

52 Once I ve submitted an EE M&V post-installation report for an EE resource, I don t have to provide an updated report to offer it into subsequent delivery year s auctions. a) True b) False PJM

53 At the time of the Base Residual Auction, how many preceding EE installation periods are eligible to participate? a) One b) Two c) Three d) Four PJM

54 Auction Structure and Key Activities Commercial Aggregation PJM

55 Aggregate Resource Commercial Aggregation Capacity Resources which may not, alone, meet the requirements of a Capacity Performance product, may combine their capabilities and offer as a single Aggregate Resource Applies to Intermittent Resources, Capacity Storage Resources, Demand Resources, Energy Efficiency Resources, and Environmentally-Limited resources Resources being combined must reside in a single Capacity Market Seller account PJM

56 Aggregate Resource Commercial Aggregation Seller may offer the Aggregate Resource as Capacity Performance at a UCAP value that is representative of a capacity performance product (not to exceed the sum of the CIR value/ucap value of the individual resources that make up the aggregate) The committed quantity of an Aggregate Resource must be allocated to the underlying capacity resources prior to the start of the Delivery Year with adjustments permitted up to the last day of the month preceding each delivery month Allocated quantities used to determine the Expected Performance of each underlying resource located in a PAH area Quantity allocated to an individual resource cannot exceed the CIR value/ucap value of the individual resource PJM

57 Aggregate Resource Performance Netting Performance of an Aggregate Resource for a given PAH is based on the net of the performance of the individual underlying resources that were required to perform during the PAH (i.e. the resources located in the PAH area) Non-Performance Assessment Charges/Credits are assessed to the Aggregate Resource not to the individual resources PJM

58 Aggregate Resource Commercial Aggregation For BRA modeling and compensation, the Aggregate Resource is located in the smallest LDA common to each individual resource Examples: Aggregate Resource modeled in EMAAC if one resource in PECO zone and second resource in PSEG Zonal LDA Aggregate Resource modeled in MAAC if one resource in EMAAC and second resource in SWMAAC Aggregate Resource modeled in rest of RTO if one resource in ComEd Zonal LDA and second resource in EMAAC PJM

59 Aggregate Resource Commercial Aggregation The Aggregate Resource receives the RPM auction clearing price applicable to the modeled location The non-performance charge rate for an under-performing Aggregate Resource is based on the rate associated with the LDA in which the underperforming underlying resources are located weighted by the underperformance MW quantity of such resources The stop-loss of the Aggregate Resource however is based on the nonperformance charge rate associated with the LDA in which the Aggregate Resource was modeled in the RPM auction PJM

60 Aggregate Resource Commercial Aggregation Market Seller that intends to create an Aggregate Resource must submit a written request to rpm_hotline@pjm.com at least two weeks prior to the opening of the RPM Auction. Requests must specify*: Capacity resources that are being combined to form the Aggregate Resource Installed capacity owned on each generation resource Nominated DR Value for each Demand Resource Nominated EE Value for each EE Resource Requested UCAP value for Aggregate Resource *Reference PJM Manual 18 Section 4.9 PJM

61 Aggregate Resource Commercial Aggregation Requests must include explanation with supporting data of how aggregation provides a higher level of annual CP capability (in UCAP MWs) than the individual resources could provide themselves, including an initial seasonal allocation of the Aggregate Resource CP capability among the component resources PJM will review requests and provide notification to Market Seller of the UCAP value approved for the Aggregate Resource PJM

62 Aggregate Resource Commercial Aggregation PJM will model the Aggregate Resource in the erpm system for the relevant Delivery Year Once Aggregate Resource is modeled, the Market Seller will not be able to offer into RPM Auction or transact bilaterally for the relevant Delivery Year those individual resources that make up the Aggregate Resource The commitment level of a cleared Aggregate Resource may be updated as a result of being replaced or replacing another resource The individual underlying resources that comprise the Aggregate Resource may not be removed from the Aggregate Resource nor can new underlying resources be added PJM

63 Aggregate Resource Example Wind The individual intermittent resources of above example have a CP capability of 13 MW (Wind) and 2 MW (Solar) using the lowest seasonal average output as a reasonable estimate of annual CP capability An Aggregate Resource formed by combining the two intermittent resources has a CP capability of 42 MW (using the lowest seasonal average of the combined output) versus the 15 MW CP capability of the individual resources An Aggregate Resource formed by combining these two resources would be modeled in the rest of RTO area for RPM auction clearing and pricing purposes Solar Aggregate Resource Nameplate Capacity 100 MW 100 MW n/a Annual UCAP Value (CIR value) 13 MW 38 MW 51 MW Zone ComEd JCPL n/a Modeled LDA ComEd EMAAC Rest of RTO Average output: summer performance hours 13 MW 38 MW 51 MW Average output: winter performance hours 40 MW 2 MW 42 MW Assumed Annual CP Offer MW of Example (Average output of most limited season) PJM MW 2 MW 42 MW

64 Aggregate Resource Example (Con t.) Assume Aggregate Resource of prior slide offers and clears 42 MW and allocates the 42 MW commitment to the individual resources based on expected seasonal performances as: Resource LDA Summer Period Months Commitment Allocation (UCAP MW) Winter Period Months Solar EMAAC 32 2 Wind ComEd 10 40* Aggregate Rest of RTO Note: Commitment quantity assigned to underlying resources cannot exceed the CIR value/ucap Capability of the underlying resource. Example assumes that Wind resource was approved for 40 MW of Winter CIRs. PJM

65 Aggregate Resource Summer PAH Example Example #1: RTO-Wide Emergency Action in summer period Assume Balancing Ratio = 1.0 Resource LDA Output (MW) Expected Performance (MW)* Actual Performance (MW) Performance (MW) Solar EMAAC Wind ComEd Aggregate Rest of RTO -3 Aggregate Resource performance based on net performance of all underlying individual resources since all were located in PAH area Aggregate Resource assessed non-performance charge based on 3 MW under-performance at nonperformance charge rate associated with ComEd LDA (100% weighting of the LDA associated with the nonperforming underlying resource in this example) *Expected Performance equals Balancing Ratio times Allocated Commitment MW applicable to the season (see prior slide) PJM

66 Which type of resource may not be part of an Aggregate? a) Demand Response b) Nuclear Generation c) Intermittent Generation d) Energy Efficiency PJM

67 Aggregate resource components must all be in the same LDA. a) True b) False PJM

68 Which aggregate components output nets during a Performance Assessment Hour? a) All b) Those in the same LDA c) Those in the same zone d) Only those in the Performance Assessment Area PJM

69 Sell Offers and Buy Bids Sell Offers PJM

70 Overview Effective with the 2020/2021 Delivery Year, PJM will only procure Capacity Performance Resources in each auction Capacity Performance Resources must be capable of sustained, predictable operation that allows resource to be available to provide energy and reserves during performance assessment hours throughout the Delivery Year Intermittent Resources, Capacity Storage Resources, Demand Resources and EE Resources are categorically exempt from the RPM CP must-offer requirement Intermittent Resources are generation resources with output that can vary as a function of its energy source, such as wind, solar, landfill gas, run of river hydro, and other renewable resources PJM

71 Overview Intermittent Resources and Capacity Storage Resources may participate as a stand-alone resource with annual CP offer at level that recognizes risk of non-performance based on expected output during Performance Assessment Hours Not offering or offering at lower CP commitment quantity reduces risk of nonperformance during PAHs and increases quantity eligible for Bonus Performance during PAHs (Bonus Performance MWs for actual energy delivered above committed quantity) Lower capacity market revenues offset by additional revenues during PAHs PJM

72 Overview Intermittent Resources, Capacity Storage Resources, Environmentally-Limited Resources, DR and EE Resources are eligible to participate as: Aggregate Resource - Commercial Aggregation A single pseudo capacity resource is created by combining two or more resources that may not alone meet the annual requirements of CP Facilitated Aggregation of Seasonal CP Resources RPM Auction clears equal quantities of off-setting Seasonal CP Resources PJM

73 Resource Confirmation PJM

74 Resource Confirmation The CP Capable column represents the resource s eligibility to submit a Capacity Performance Sell offer The default designation by PJM will set all Annual resources as CP Capable and eligible to submit a Capacity Performance Sell Offer If a generation resource is approved for a CP Must Offer Exception, their CP Capable status will be set to No and be ineligible to submit a CP Sell Offer The Aggregate Resource Name will be populated for resources that are modeled as part of an Aggregate Resource to be offered in the auction as an aggregate PJM

75 Sell Offers and Buy Bids Facilitated Aggregation of Seasonal CP Sell Offers PJM

76 Seasonal CP Sell Offers Intermittent Resources, Capacity Storage Resources, Environmentally- Limited Resources, Summer-Period DR Resources and Summer-Period EE Resources are eligible to submit Seasonal CP Resource sell offers Seasonal CP Resource sell offers consist of: Summer-period sell offers which take on a commitment and performance obligation for months of June thru October and following May if cleared Winter-period sell offer which takes on a commitment and performance obligation for months of November thru April if cleared PJM

77 Seasonal CP Sell Offer Structure Intermittent Resources, Capacity Storage Resources and Environmentally- Limited Resources may submit a sell offer for CP capacity (i.e. annual capability) and/or a separate sell offer for either summer-period capacity or winter-period capacity Total sell offer quantity for each season may not exceed the lower of the resource s UCAP Value or the resource s seasonal CIR value NOT A COUPLED OFFER Annual and CP Seasonal Offer segments are cleared independently Seasonal sell offer segments must be flexible (Min MW = 0) PJM

78 Seasonal CP Sell Offers DR and EE DR Resources and EE Resources may submit a sell offer for CP capacity (i.e. annual capability) and/or a separate sell offer for summer-period capability Annual CP MW quantity of DR and EE defined as the lesser of their summer or winter capability NOT A COUPLED OFFER Annual and CP Seasonal Offer segments are cleared independently Seasonal sell offer segments must be flexible (Min MW = 0) PJM

79 Seasonal CP Sell Offers Auction clearing algorithm will clear all annual CP sell offers, summer-period CP sell offers and winter-period CP sell offers simultaneously to minimize bid-based cost of satisfying the reliability requirements of the RTO and each modeled LDA subject to all applicable requirements and constraints, including: LDA CETL values (same as today) Total cleared summer-period sell offers must exactly equal total cleared winterperiod sell offers across the entire RTO (new constraint to ensure that seasonal CP sell offers clear to form annual CP commitments) PJM

80 Seasonal CP Sell Offers Equal matching of cleared opposite-season sell offer quantities is not enforced at the LDA level; however, only equally matched quantities of opposite-season sell offers within an LDA are considered as satisfying the LDA s reliability requirement Unmatched cleared quantities are effectively moved to the next higher level constrained LDA until a match is found Only the equally matched cleared quantity within each LDA may receive that LDA s price (within this group, those resources with the lowest sell offer price will receive the LDA price; and remaining cleared capacity is effectively moved to the next higher level constrained LDA for price determination purposes) PJM

81 Seasonal CP Sell Offers Cleared Seasonal CP Resource sell offers receive a daily auction credit for each day of the applicable commitment period based on cleared UCAP MW and the auction clearing price applicable to the resource The clearing price applicable to a cleared Seasonal CP Resource sell offer is guaranteed to be no less than the resource s sell offer price but no guarantee that the applicable clearing price is the same as that which is applicable to similarly located cleared Annual CP Resources Non-performance charge rate of a cleared Seasonal CP Resource sell offer is based on the physical location of the resource PJM

82 Seasonal CP Sell Offers erpm Screens The Resource Confirmation screen will include a column showing which resources are eligible to submit seasonal sell offers The Buy & Sell screen will display the Available MW by season for each seasonal resource. Annual and Summer MW to offer for DR Resources and EE Resources based on the quantities specified by the CSP in the DR and EE Setup screens The Buy & Sell screen will have ten segments available for seasonal resources to offer seasonal segments as Summer or Winter PJM

83 Updated erpm Screens Generation Sell Offer Screen Auctions Buy & Sell: Available ICAP positions will be shown annually and by season. There will be a drop-down to select Summer or Winter. NOT A COUPLED OFFER Annual CP and Seasonal CP sell offer segments clear independently PJM

84 Updated erpm Screens DR and EE Sell Offer Screen For DR and EE, the Annual MW and Summer MW are based on quantities specified by the provider in DR / EE Resource Set-up Process NOT A COUPLED OFFER Annual CP and Seasonal CP sell offer segments clear independently PJM

85 How many segments may I break my sell offer into? a) One b) Five c) Ten d) Eleven PJM

86 I can couple a seasonal CP offer and an annual CP sell offer. a) True b) False PJM

87 I can submit a winter period only DR offer. a) True b) False PJM

88 I submitted the following sell offer segments: $5 5 $10 10 $15 20 $20 The auction clears at $12. How many MW did I sell? a) 15 MW b) 30 MW c) 45 MW d) None PJM

89 Sell Offers and Buy Bids Buy Bids PJM

90 Buy Bids Up to 10 buy bid segments Buy bids are product-type and LDA specific Must up to MW quantity and price willing to pay Each segment evaluated and cleared independently PJM

91 Buy Bids PJM

92 The buy bid price is the price you are willing to pay. a) Highest b) Lowest c) Only PJM

93 I submitted the following buy bid segments: $5 5 $10 10 $15 20 $20 The auction clears at $12. How many MW did I buy? a) 15 MW b) 30 MW c) 45 MW d) None PJM

94 Transactions in erpm PJM

95 Transaction Types Two Party Transactions Unit Specific Available, Cleared, Unoffered Locational UCAP Available UCAP Auction Specific Cleared UCAP Cleared Buy Bid Cleared UCAP Single Party Transaction Replacement Transaction Available ICAP PJM

96 Unit-Specific Bilateral Transactions Can be created for available, cleared or unoffered capacity May not be created for aggregate resources Available ICAP transactions must be in approved or provisionally approved status to be eligible to offer into an RPM auction Cleared UCAP transactions transfer auction credit and commitment to buyer Buyer assumes collateral requirements for cleared planned resources Buyer assumes performance risk of transacted resource Reference PJM Manual 18 Section PJM

97 Unit-Specific Bilateral Transaction Creation ICAP for Available or Unoffered, UCAP for Cleared Available, Unoffered or Cleared PJM

98 Auction-Specific Bilateral Transaction May be submitted following the completion of the RPM auction to which the transaction applies Not eligible to be offered into an RPM auction Auction Specific MW Transactions must be reported on an annual basis prior to each Delivery Year Performance risk associated with the transacted MWs remains with the seller The Buyer will receive any Capacity Performance bonus credits related to the resource(s) identified in the transaction Reference PJM Manual 18 Section PJM

99 Auction-Specific Bilateral Transaction Creation Must correspond to the start and end of the delivery year Calculated automatically Based on resources selected below Calculated automatically Based on resources selected below List of resources and eligible MW Will appear here Enter the MW quantity to be transacted for each resource In this column PJM

100 Cleared Buy Bid Bilateral Transaction Cleared Buy Bid MWs are not eligible to be offered in an RPM auction Results in the Buyer receiving the Cleared MWs in the applicable LDA and the associated Incremental Auction Charges that would have been assessed to the Seller Transacted buy bid may be used as a replacement resource Reference PJM Manual 18 Section PJM

101 Cleared Buy Bid Bilateral Transaction Creation Auction that the buy bid cleared in UCAP MW Product type of the Cleared buy bid PJM

102 Locational UCAP Bilateral Transaction Locational UCAP MWs are not eligible to be offered in an RPM auction. May not be resold bilaterally May be created after locking of the EFORd (Nov. 30th prior to the Delivery Year) Buyer must demonstrate prior to the 3 rd IA that the Locational UCAP was used in a replacement transaction Locational UCAP transaction results in a Commitment being placed on the Seller s resource The Seller retains ownership of the resource and is subject to resource performance assessments Reference PJM Manual 18 Section PJM

103 Locational UCAP Bilateral Transaction Creation Resource that the seller Is basing the transaction upon (Buyer does not see resource name) UCAP MW PJM

104 Replacement Transaction The replacement resource must be located in the same sub-account as the resource that is being replaced The replacement resource must be located in the same LDA as the resource that is being replaced or reside in the Sink LDA of the Qualifying Transmission Upgrade being replaced Resources located in a constrained LDA can serve as replacement capacity for a resource located in a less constrained parent LDA The replacement resource must have the same or better temporal availability characteristics as the resource that is being replaced Reference PJM Manual 18 Section 8.9 PJM

105 Replacements Seasonal Commitments Cleared seasonal CP summer-period commitment or winter-period commitments may be replaced based on the physical location of the resource May be replaced by available MW from other same-season resources, available MW from annual CP resources or cleared annual CP Buy Bids Buy Bids in incremental auctions are only of the annual CP product type PJM

106 Replacements Aggregate Resource Commitments If an Aggregate Resource commitment is removed or reduced by a replacement transaction, the Capacity Market Seller responsible for the Aggregate Resource must reduce the allocation of commitment to the underlying resources by a commensurate amount If an Aggregate Resource commitment is increased by a replacement transaction, the Capacity Market Seller responsible for the Aggregate Resource must increase the allocation of commitment to the underlying resources by a commensurate amount Commercial Aggregates may not replace its components, only the aggregate resource itself Using available CP resources or cleared CP Buy Bids PJM

107 Replacement Transaction Creation Describes the resource being replaced Select if replacing with another resource Describes what you are replacing with Select if replacing with cleared buy bid Auction in which the Buy bid cleared PJM

108 I cleared a buy bid in an incremental auction. Can I sell that back in a later incremental auction? a) Yes b) No PJM

109 I have available MW or a cleared buy bid that I want to use to cover a short position. Which type of transaction do I need to create? a) Unit Specific b) Locational UCAP c) Replacement d) Auction Specific PJM

110 I purchased available MW from another participant through a unit specific bilateral transaction. Who is responsible for the performance of the resource? a) Buyer b) Seller PJM

111 After completing an auction specific MW transaction involving a planned resource, who is responsible for the collateral requirement? a) Buyer b) Seller PJM

112 Beginning in the 2020/2021 delivery year, I can submit buy bids in an incremental auction to purchase summer-only or winter-only capacity. a) True b) False PJM

113 Thank You for Participating Today! PJM

114 Contact Information: PJM Client Management & Services Telephone: (610) Toll Free Telephone: (866) Website: The Member Community is PJM s self-service portal for members to search for answers to their questions or to track and/or open cases with Client Management & Services PJM

115 Appendix PJM

116 2020/2021 BRA Pre-Auction Credit Rates ($/MW) RTO $53, MAAC $46, EMAAC $51, SWMAAC $36, PS $56, PS NORTH $56, DPL SOUTH $46, PEPCO $41, ATSI $47, ATSI-Cleveland $47, COMED $60, BGE $32, PL $48, DAYTON $49, DEOK $51, The Credit Rate for a Summer Period sell offer will use the same rate as Annual, but multiplied by (184/365). The Credit Rate for a Winter Period sell offer will use the same rate as Annual, but multiplied by (181/365). Source: PJM

117 2020/2021 BRA LDA Net CONE ($/MW-Day) Zone/LDA Net CONE, $/MW-Day,ICAP Price LDA Modeled with VRR Curve AE $ DPL $ DPL SOUTH JCPL $ PE $ PSEG $ PS, PSEG NORTH RECO $ EMAAC $ EMAAC BGE $ BGE PEPCO $ PEPCO SWMAAC $ SWMAAC METED $ PENELEC $ PPL $ PPL MAAC $ MAAC AEP $ APS $ ATSI $ ATSI, ATSI CLEVELAND COMED $ COMED DAYTON $ DAYTON DEOK $ DEOK DLCO $ DOM $ EKPC $ RTO $ RTO Source: PJM

118 2020/2021 CP Market Seller Offer Caps Gross CONE ($/MW-Year) Net E&AS Revenue Offset ($/MW/Year) Net Cone ($/MW-Day) CP Market Seller Offer Cap (ICAP Terms) Balancing Ratio, B (%) (3) ($/MW-Day) ZONE AECO $134,310 $31,990 $ $ AEP $133,413 $37,771 $ $ APS $133,413 $49,407 $ $ ATSI $133,413 $44,367 $ $ BGE $136,733 $75,931 $ $ COMED $133,413 $20,967 $ $ DAY $133,413 $40,287 $ $ DEOK $133,413 $37,109 $ $ DOM $133,413 $32,224 $ $ DPL $134,310 $47,378 $ $ DUQ $133,413 $35,973 $ $ EKPC $133,413 $32,495 $ $ JCPL $134,310 $44,984 $ $ METED $133,465 $42,780 $ $ PECO $134,310 $41,438 $ $ PENELEC $133,465 $85,869 $ $ PEPCO $136,733 $59,498 $ $ PPL $133,465 $42,320 $ $ PSEG $134,310 $29,668 $ $ RECO $134,310 $31,269 $ $ RTO $134,480 $34,601 $ $ Source: PJM

119 Important Dates for 2020/2021 BRA DR Providers Activity Date Last day for DR Pre-registration Required for FRR Capacity Plan 3/22/2017 Last day for DR Plan Template and Officer Certification for FRR Capacity Plan 3/22/2017 DR Pre-registration Window opens 4/3/2017 DR Pre-registration Window closes 4/16/2017 Last day for DR Sell Offer Plan and Officer Certification Required 4/18/2017 DR Setup Window opens 4/24/2017 DR Setup Window closes 5/5/2017 Source: PJM

120 Important Dates for 2020/2021 BRA EE Providers Activity Date Last day for Initial/Updated EE M&V Plan Due for RPM 4/10/2017 EE Setup Window Opens 4/24/2017 EE Setup Window Closes 5/5/2017 Source: PJM