On June 22, the Members Committee passed changes to the PJM tariff and Operating Agreement related to eligible biddable nodes.
The proposal, Phase 3 of the work of the Energy Market Uplift Senior Task Force, passed in a sector-weighted vote with 4.16 in favor.
The tariff and OA revisions focus the eligible set of up-to-congestion transaction bidding points to hubs, zones and interfaces, to locations where physical load may be settled and hubs for increment and decrement transactions. This addresses some of the observed practices that do not benefit the market at a level commensurate with the profitability of the transactions (as illustrated in PJM’s October 2015 paper, “Virtual Transactions in the PJM Energy Market”).
PJM believes that focusing the INCs, DECs and up-to congestion transactions at the proposed locations maximizes opportunities for virtual transactions as described in the PJM paper. This proposal aligns INC offers, DEC bids and UTCs to locations where they compete directly with physical assets or to trading hubs where forward positions can be taken.
PJM said the proposal retains the virtual trading benefits while eliminating opportunities for virtual transactions to profit from the market without providing those benefits.
Other Committee Business
As part of the consent agenda, the committee:
- Approved draft minutes of the May 17 meeting
- Approved operating agreement and tariff revisions related to requirements for solar generation facilities
- Approved operating agreement and tariff revisions related to pseudo-tied generators and dynamic schedules meter correction
- Approved operating agreement and tariff revisions related to annual revenue requirements for new black start units