NOTICE DATE:  June 17, 2008

NOTICE TYPE:  M-A061708-02 Operations

CLASSIFICATION: Public

SHORT DESCRIPTION:  Market Clearing Price for Energy (MCPE) and Shadow Price Caps

INTENDED AUDIENCE:  All Market Participants

DAY AFFECTED:  June 17, 2008

LONG DESCRIPTION:  On Tuesday, June 17, 2008, the ERCOT Board of Directors (Board) met and approved the recommendation from TAC and WMS to implement the Potomac Economics proposal changing the Shadow Price Cap and instituting a price cap on MCPEs. 

ERCOT has implemented the approved Market Clearing Price for Energy (MCPE) and Shadow Price Caps at 1700 CPT on June 17, 2008.  Effective as of 1700 CPT on June 17, 2008: (1) the Shadow Price Cap for Commercially Significant Constraints (CSCs) will change from $5,600 per MW to $5,000 per MW; and (2) the MCPE will be capped at the system-wide offer cap, which is currently the high system-wide offer cap (HCAP) of $2,250 per MWh. Also, the MCPE will be limited to the Balancing Energy Service offer cap floor of -$1,000.  When the MCPE is capped or limited, any non-zero Shadow Price for CSCs will be recalculated based on the capped or limited MCPE.

ACTION REQUIRED: There is no action required by ERCOT Market Participants. The HCAP for Balancing Energy Service and Ancillary Services remains unchanged at $2,250 per MWh. (See ERCOT Protocols §6.11.3(6)(d)).

CONTACT:  If you have any questions, please contact your ERCOT Account Manager. You may also call the general ERCOT Client Services phone number at (512) 248-3900 or contact ERCOT Client Services via e-mail at [log in to unmask] <mailto:[log in to unmask]> .

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