MAY 10, 2012 | NEPOOL MARKETS COMMITTEE

WESTBOROUGH, MA

Andrew GillespiePRINCIPAL ANALYST | MARKET DEVELOPMENT

Proposal

Static De-List Bid Changes

Static De-List Bid – Current Process

• No later than 127 days before the auction, the ISO issues qualification determination notifications for qualified resources

• By this time, the Internal Market Monitor (IMM) will have reviewed all submitted Static De-List Bids and will indicate in each notification whether the IMM has:– Approved the submitted de-list bid, or– Rejected the submitted price, and consequently developed a different

IMM-derived de-list bid

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Current Process – IMM Approved

If the IMM approved the submitted de-list price:

• The de-list bid is included in the auction

• The de-list bid cannot be withdrawn or modified by the participant

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Current Process – IMM Rejected

If the IMM rejected the submitted de-list price, the de-list bid is not included in the auction, unless

•The participant makes a filing with the Commission within 15 days of the ISO’s submission of the informational filing (while also notifying the ISO) that:

– The participant accepts the IMM derived price• In this case, the IMM derived de-list bid will be included in the auction

– The participant is challenging the IMM rejection of the de-list price• In this case, the de-list will be included in the auction if and only as

directed by the Commission

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Problem

• The Static De-List Bid price is ‘fixed’ when it is submitted during the Existing Capacity Qualification period

• Under steady-state timing of auctions– The Existing Capacity Qualification is in June– The Qualification Notification is 127 days prior to auction– The primary auction (FCA) is conducted in February

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Static De-List Bid – Proposal

• No later than 127 days before the auction the ISO issues qualification determination notifications for qualified resources

• By this time, the Internal Market Monitor will have reviewed all submitted Static De-List Bids and will indicate in each notification whether the IMM has:– Approved the submitted de-list bid, or– Rejected the submitted de-list bid, and consequently developed a

different IMM-derived de-list bid

• NEW – After the qualification determination notifications are issued, open a window (seven days) to allow participants to modify Static De-List Bids

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Proposal – IMM Approved

If the IMM approved the submitted de-list bid, a participant may:

•Submit a new price for the Static De-List Bid that is– Less than the submitted and IMM approved de-list bid, but– Greater than $1.00/kW-mo

•Withdraw the de-list bid

If no action is taken during this window

•The submitted and approved de-list bid will be included in the auction

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Proposal – IMM Rejected

If the IMM rejected the submitted de-list bid, a participant may:• Submit a new Static De-List Bid that is

– Equal to or less than the IMM derived de-list bid, but– Greater than $1.00/kW-mo

• Indicate that the participant intends to challenge the IMM rejection of the de-list bid

If no action is taken during this window• The de-list bid will not be included in the auctionProvided that no price has been submitted, a participant may still

make a filing with the Commission to challenge the IMM-derived bid

• The de-list bid will be included in the auction if and as directed by the Commission

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