Task Force To Examine Market Reforms

Stakeholders and PJM examined how to harmonize markets and public policy at the state level at the Markets and Reliability Committee meeting Thursday in Wilmington.

The committee approved a stakeholder-driven proposed problem statement and issue charge regarding the PJM Capacity Market.

With the approval of the problem statement and issue charge, stakeholders created the Capacity Construct/Public Policy Senior Task Force, which will report to the MRC.

The task force will examine current and potential public policy initiatives states could take regarding resource adequacy, fuel diversity, public, and environmental policies and identify areas where state actions and the current Reliability Pricing Model capacity construct may not be aligned.

The committee also endorsed several proposals from the Energy Market Uplift Senior Task Force.

The MRC also passed a proposal regarding pseudo-tied resources and their participation as capacity performance resources. The endorsed proposal (which was approved at the Members Committee Thursday afternoon) is an alternative to a proposal the stakeholders rejected.

Energy Market Uplift Senior Task Force

Stakeholders approved both Phase One and Phase Two proposals which had been endorsed by the task force members.

The first proposal makes minimal changes to the current calculation of uplift costs in PJM by including the day-ahead revenues from the hours the resource operated in real-time to determine the balancing operating reserve credits. The current method of including all day-ahead revenues can result in resources not being completely made-whole for real-time operating costs because day-ahead revenues in hours in which they did not operate in real-time offset their make-whole payment.

The Phase Two proposal allocates uplift costs to up-to-congestion transactions and eliminates netting of internal bilateral transactions.  UTC transactions do not currently receive any allocation of uplift costs.

Other Committee Business

In first readings, PJM presented a package on the Federal Energy Regulatory Commission  Order 825 on operating reserve demand curves and on transmission substation equipment in FERC Order 1000. The committee will vote on these issues at its February meeting. PJM also presented language that would formalize tariff and operating agreement language on pseudo-tie agreements, aligning  with North American Reliability Council  and FERC language.

Other Endorsements/Approvals

  • Manual 11: Energy & Ancillary Services Market Operations and Manual 12: Balancing Operations (changes from the Regulation Market Senior Issues Task Force)
  • Manual 27: Open Access Transmission Tariff (annual review process)
  • Manual 38: Operations Planning
  • Manual 40: Training and Certification Requirements
  • Problem statement and issue charge regarding market operations price transparency
  • Operating parameters: Revisions to Tariff, Manual 11: Energy & Ancillary Services Market Operations, Manual 12: Balancing Operations, Manual 28: Operating Agreement Accounting
  • Revisions to the Tariff, Operating Agreement and Reliability Assurance Agreement on definition clean up

Other first reads

  • Manual 01: Control Center and Data Exchange
  • Manual 22: Generator Resource Performance Indices.
  • Manual 39: Nuclear Plant Coordination (Attachment C changes reflecting recent plant specific nuclear plant interface requirement were posted effective Dec. 23, 2016)