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TCR-CRR Transition Plan TCR Auction Revenue Refund Process PowerPoint Presentation
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TCR-CRR Transition Plan TCR Auction Revenue Refund Process

TCR-CRR Transition Plan TCR Auction Revenue Refund Process

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TCR-CRR Transition Plan TCR Auction Revenue Refund Process

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  1. TCR-CRR Transition PlanTCR Auction Revenue Refund Process Mandy Bauld COPS August 12, 2008

  2. Outline • Objectives • Proposed Methodology • Examples • Mid-Month Go-Live Refund Example • 1st of the Month Go-Live Refund Example

  3. Objectives • The TCR Auction Revenue Refund Process is intended to describe the refund method planned when transitioning from the TCR to CRR market. • ERCOT will refund to TCR/PCR owners the Annual and Monthly TCR/PCR auction revenues for all remaining days of the year that follow the Texas Nodal Market Implementation date. • ERCOT will make refunds to TCR/PCR owners no later than thirty (30) days following the start of the Texas Nodal Market. • Implementation of this process involves the Zonal TCR/Settlements department. • ERCOT seeks WMS approval of the proposed methodology, before submitting modifying comments to PRR743.

  4. Refund of Monthly and Annual TCR Auction Revenues The total refund of auction revenues to a TCR/PCR owner of record is calculated as follows: TCRRAMTp = -1 * (TCRMRp + TCRARp + TCRRRp) ERCOT shall refund each TCR owner of record of its awarded monthly TCRs that are no longer effective for the month of Texas Nodal Market Implementation, calculated as follows: TCRMRp = MAUCRp * MRP ERCOT shall refund each TCR/PCR owner of record of its awarded annual TCRs/PCRs that are no longer effective for the month of Texas Nodal Market Implementation, calculated as follows: TCRARp = AAUCRp * (MEnergym / (ΣAll MonthsMEnergyn)) * MRP ERCOT shall refund each TCR owner of record of any remaining annual TCRs/PCRs for all months following the month of the Texas Nodal Market Implementation, calculated as follows: TCRRRp = AAUCRp * (Σn>mMEnergyn / (ΣAll MonthsMEnergyn))

  5. Variable Definitions

  6. Refund of Monthly and Annual TCR Auction Revenues The total refund of auction revenues to a TCR/PCR owner of record is calculated as follows: TCRRAMTp = -1 * (TCRMRp + TCRARp + TCRRRp) ERCOT shall refund each TCR owner of record of its awarded monthly TCRs that are no longer effective for the month of Texas Nodal Market Implementation, calculated as follows: TCRMRp = MAUCRp * MRP ERCOT shall refund each TCR/PCR owner of record of its awarded annual TCRs/PCRs that are no longer effective for the month of Texas Nodal Market Implementation, calculated as follows: TCRARp = AAUCRp * (MEnergym / (ΣAll MonthsMEnergyn)) * MRP ERCOT shall refund each TCR owner of record of any remaining annual TCRs/PCRs for all months following the month of the Texas Nodal Market Implementation, calculated as follows: TCRRRp = AAUCRp * (Σn>mMEnergyn / (ΣAll MonthsMEnergyn)) Example: Nodal Go-Live September 1st If Monthly Auction was run for Sept., Refunds all Monthly Auction TCRs (MRP = 30/30 = 1.0) Refunds all Annual Auction TCRs/PCRs for Sept. (MRP = 30/30 = 1.0) Refunds all Annual Auction TCRs/PCRs for Oct - Dec

  7. Refund of Monthly and Annual TCR Auction Revenues The total refund of auction revenues to a TCR/PCR owner of record is calculated as follows: TCRRAMTp = -1 * (TCRMRp + TCRARp + TCRRRp) ERCOT shall refund each TCR owner of record of its awarded monthly TCRs that are no longer effective for the month of Texas Nodal Market Implementation, calculated as follows: TCRMRp = MAUCRp * MRP ERCOT shall refund each TCR/PCR owner of record of its awarded annual TCRs/PCRs that are no longer effective for the month of Texas Nodal Market Implementation, calculated as follows: TCRARp = AAUCRp * (MEnergym / (ΣAll MonthsMEnergyn)) * MRP ERCOT shall refund each TCR owner of record of any remaining annual TCRs/PCRs for all months following the month of the Texas Nodal Market Implementation, calculated as follows: TCRRRp = AAUCRp * (Σn>mMEnergyn / (ΣAll MonthsMEnergyn)) Example: Nodal Go-Live September 19th If Monthly Auction was run for Sept., Refunds Monthly Auction TCRs for days 9/19 through 9/30(MRP = 12/30 = 0.4) Refunds Annual Auction TCRs/PCRs for days 9/19 through 9/30 (MRP = 12/30 = 0.4) Refunds all Annual Auction TCRs/PCRs for Oct - Dec

  8. 1st of the Month Go-Live Refund Example 1st of the month refund (September 1st) for a TCR owner of record with the following information: $100,000 Annual Auction Obligation $20,000 September Monthly Auction Obligation September days to Refund are 30 out of 30 September’s Annual Energy Forecast = 20,000 GWh October - December’s Annual Energy Forecast = 70,000 GWh Annual Energy Forecast = 320,000 GWh The total refund of auction revenues to a TCR/PCR owner of record is calculated as follows: TCRMRp = MAUCRp * MRP TCRMRp = $20,000 * (1) = $20,000 TCRARp = AAUCRp * (MEnergym / (ΣAll MonthsMEnergyn)) * MRP TCRARp = $100,000 * (20,000 GWh / 320,000 GWh) * (1) = $6,250.00 TCRRRp = AAUCRp * (Σn>mMEnergyn / (ΣAll MonthsMEnergyn)) TCRRRp = $100,000 * (70,000 GWh  / 320,000 GWh) = $21,875.00 TCRRAMTp = -1 * ($20,000 + $6,250.00 + $21,875.00) = ($48,125)

  9. Mid-Month Go-Live Refund Example Mid-month refund (September 19th) for a TCR owner of record with the following information: $100,000 Annual Auction Obligation $20,000 September Monthly Auction Obligation September days to Refund are 12 out of 30 September’s Annual Energy Forecast = 20,000 GWh October - December’s Annual Energy Forecast = 70,000 GWh Annual Energy Forecast = 320,000 GWh The total refund of auction revenues to a TCR/PCR owner of record is calculated as follows: TCRMRp = MAUCRp * MRP TCRMRp = $20,000 * (12/30) = $8,000 TCRARp = AAUCRp * (MEnergym / (ΣAll MonthsMEnergyn)) * MRP TCRARp = $100,000 * (20,000 GWh / 320,000 GWh) * (12/30) = $2,500.00 TCRRRp = AAUCRp * (Σn>mMEnergyn / (ΣAll MonthsMEnergyn)) TCRRRp = $100,000 * (70,000 GWh  / 320,000 GWh) = $21,875.00 TCRRAMTp = -1 * ($8,000 + $2,500.00 + $21,875.00) = ($32,375)

  10. Questions?