NOTICE DATE: June 5, 2023
NOTICE TYPE: M-A060523-01 Operations
SHORT DESCRIPTION: ERCOT Contingency Reserve Service Credit Exposure Transition Plan
INTENDED AUDIENCE: Qualified Scheduling Entities (QSEs)
DAYS AFFECTED: Operating Days June 10-11, 2023
LONG DESCRIPTION: On June 9, 2023, ERCOT will implement changes to initiate the ERCOT Contingency Reserve Service (ECRS) (See the Market Notice for Additional Information below).
During the transition to ECRS, there will not yet be historical ECRS prices to use for credit exposure calculations in the Day-Ahead Market. To address this initial lack of inputs for the credit exposure calculations, ERCOT will use the historical Market Clearing Prices for Capacity (MCPC) for Non-Spinning Reserve as proxy values for ECRS for the first two days of operations. Once ERCOT has begun procuring ECRS, ECRS prices will then be available for ERCOT to use in credit exposure calculations going forward.
For reference, Protocol Section 4.4.10, Credit Requirement for DAM Bids and Offers, addresses such credit exposure calculations in Subsection 4.4.10(6)(f): “For Ancillary Service Obligations not self-arranged, the product of the quantity of Ancillary Service Obligation not self-arranged multiplied by the tth percentile of the hourly MCPC for that Ancillary Service over the previous 30 days for that hour. For negative Self-Arranged Ancillary Service Quantities, the absolute value of the product of the quantity of the negative Self-Arranged Ancillary Service Quantity times the tth percentile of the hourly MCPC for that Ancillary Service over the previous 30 days for that hour.”
ADDITIONAL INFORMATION: Please refer to the ERCOT website for previous Market Notices providing additional information regarding the ECRS rollout.
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 email at [log in to unmask].
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