Comments on Second Revised Draft Tariff Language

1. Provide a summary of your organization’s comments on the second revised draft tariff language (optional):

2. Provide your organization’s comments on section 6.5.2.3.7 Constraint Relaxation Threshold:

3. Provide your organization’s comments on section 6.5.2.3.8 Energy Bid Parameters:

4. Provide your organization’s comments on section 6.5.2.3.9 Hourly Shaping Factor:

5. Provide your organization’s comments on section 27.1.2.3 Ancillary Service Pricing - Insufficient Supply:

6. Provide your organization’s comments on section 27.4.3.3 Parameters Related to Hard Energy Bid Cap:

7. Provide your organization’s comments on section 27.4.3.3.4 Insufficient Supply to Meet CAISO Forecast of CAISO Demand in the RTM:

8. Provide your organization’s comments on section 30.5.8 Demand, Exports, Virtual Bids and Non-Resource Specific Resources above the Soft Energy Bid Cap and all relevant subsections:

9. Provide your organization’s comments on section 30.7.12 Validation of Bids in Excess of Soft Energy Bid Cap, Hard Energy Bid Cap, or Minimum Load Cost Hard Cap and all relevant subsections:

10. Provide your organization's comments on Appendix A – Definitions:

11. Additional comments on the FERC Order 831 – Import Bidding and Market Parameters second revised draft tariff language:

1. Provide a summary of your organization’s comments on the second revised draft tariff language (optional):

Vistra appreciates the opportunity to submit comments that are narrowly scoped to reviewing the second revised draft tariff language for consistency with the Board approved policy. Our comments are not an indication of our views on the merits of the policy. We have reviewed the second revised draft tariff language and believe there are still issues with Tariff level that we raised in our previous comments on the first draft tariff language[1]. The remainder describes the specific revisions that are needed to better align the draft tariff with the Board approved policy.

[1] Vistra comments on CAISO revised draft tariff language, November 4, 2020, https://stakeholdercenter.caiso.com/StakeholderInitiatives/AllComments/36598c6d-db9f-417c-bb62-0667a78709d5#org-c437eb33-7745-4260-bb27-1a7ae190578a.

2. Provide your organization’s comments on section 6.5.2.3.7 Constraint Relaxation Threshold:

3. Provide your organization’s comments on section 6.5.2.3.8 Energy Bid Parameters:

4. Provide your organization’s comments on section 6.5.2.3.9 Hourly Shaping Factor:

5. Provide your organization’s comments on section 27.1.2.3 Ancillary Service Pricing - Insufficient Supply:

Vistra requests the CAISO provide in the ‘Scarcity Demand Curve Value ($/MWh) When Energy Pricing Parameters based on Hard Energy Bid Cap as Specified In Section 27.4.3.3’ table what the values are under the two viable scenarios:

• Hard Energy Bid Cap used in either day-ahead or real-time
• Higher of Highest-cleared Economic Bid or $1,000/MWh in real-time

We believe the values shown in the draft language only capture the first scenario and do not reflect the $/MWh scarcity demand curve when the shortage is less than the constraint relaxation threshold under real-time market operations, the latter scenario.

6. Provide your organization’s comments on section 27.4.3.3 Parameters Related to Hard Energy Bid Cap:

Vistra is concerned that the CAISO has not responded to nor incorporated our input on Section 27.4.3.3.1. The CAISO workshop on penalty prices and scheduling priorities held on November 20, 2020[1] provided confirmation that our previous concern is valid. The presentation stated on slide 24 that a $300/MW adder is added to export bids. In the instance that an economic export bid clears Integrated Forward Market at $2,000/MW where RUC would add $300/MW, the export schedule would be reflected in RUC at $2,300/MW – higher than the intertie transmission constraint of $2,000/MW. We believe there could be adverse outcomes when export bids may exceed $1,250/MW up to $2,000/MW. In our comments on the first draft tariff language, Vistra flagged this risk for CAISO. We request the CAISO revise the last sentence of Section 27.4.3.3.1 to include underlined words:

 “The corresponding scheduling parameter in RUC is set to $4,000 per MWh for intertie Transmission Constraints and $1,250$2,500 per MWh for internal Transmission Constraints.”

We are also concerned that our suggestion to include the detail on how transmission constraints impact pricing in IFM and RTM be included in Section 27.4.3.3.2. This is important pricing detail that should be in the Tariff. Vistra comments on the first draft tariff language identified this gap for the CAISO and recommended additional language. We request the CAISO revise Section 27.4.3.3.2 to include underlined words:  

“For the purpose of determining how the relaxation of a Transmission Constraint will affect the determination of prices in the IFM, the pricing parameter of the Transmission Constraint being relaxed is set to the Hard Energy Bid Cap. For the purpose of determining how the relaxation of a Transmission Constraint will affect the determination of prices in the RTM, the pricing parameter of the Transmission Constraint being relaxed is set to the value of the pricing parameter described in Section 27.4.3.3.4. In the case of Contingency-related Transmission Constraints, the CAISO will determine the amount of relaxation required to clear the market using the most limiting condition among the applicable Contingencies and the base case. The CAISO will establish prices based on the parameter pricing specified in this Section as it applies to the most limiting Contingency and base case. The corresponding pricing parameter used in the RUC is set at the maximum RUC Availability Bid price specified in Section."

[1] Workshop slides, http://www.caiso.com/InitiativeDocuments/Presentation-PenaltyPrices-SchedulingPriorities-CAISOMarkets-Nov20-2020.pdf.

7. Provide your organization’s comments on section 27.4.3.3.4 Insufficient Supply to Meet CAISO Forecast of CAISO Demand in the RTM:

8. Provide your organization’s comments on section 30.5.8 Demand, Exports, Virtual Bids and Non-Resource Specific Resources above the Soft Energy Bid Cap and all relevant subsections:

9. Provide your organization’s comments on section 30.7.12 Validation of Bids in Excess of Soft Energy Bid Cap, Hard Energy Bid Cap, or Minimum Load Cost Hard Cap and all relevant subsections:

Vistra believes CAISO may have inadvertently removed the concept of Energy Bids for Non-Resource-Specific System Resources may not exceed the Hard Energy Bid Cap in this iteration. We request the CAISO revise the last sentence in Section 30.7.12.1 to include underlined words:

 “The CAISO will reject Virtual Bids, Export Bids, and Demand Bids, and Bids for Non-Resource-Specific System Resources that exceed the Hard Energy Bid Cap.”

We also believe there is still a missing word in Section 30.7.12.5.3 as mentioned in our previous comments. We request the CAISO revise the last sentence of Section 30.7.12.5.3 to include underlined word:

“If for any given Trading Hour the CAISO cannot calculate the Maximum Import Bid Price, the applicable Maximum Import Bid Price will be the most recently available calculated Maximum Import Bid Price.”

10. Provide your organization's comments on Appendix A – Definitions:

Vistra continues to believe that the language for the Maximum Import Bid Price is confusing in that it only identifies one use of this price. We understand from CAISO not incorporating our previous suggestion that the CAISO does not believe it should make these changes. At a minimum, the CAISO should revise Maximum Import Bid Price definition in Appendix A to include underlined words:

“An index-based price used in part to screen Bids by Non-Resource-Specific System resources that are Resource Adequacy Resources that exceed the Soft Energy Bid Cap.”

11. Additional comments on the FERC Order 831 – Import Bidding and Market Parameters second revised draft tariff language:

1. Provide a summary of your organization’s comments on the second revised draft tariff language (optional):

WPTF appreciates the opportunity to provide comments on the CAISO’s Second Revised Draft Tariff Language for FERC Order 831 – Import Bidding and Market Parameters initiative. As brought up during a prior stakeholder call, WPTF raised the issue of a scenario where the power balance constraint penalty parameter would be set at a value less than the A/S Scarcity Demand Curve Values. Based on our reading of the proposed Tariff Language, this scenario is still a possibility. Thus, as discussed below, WPTF asks that the CAISO modify how it is defining the A/S Scarcity Demand Curve Values to better align with the discussion that took place during the policy process.

Additionally, WPTF would like to take the opportunity to reiterate the importance of the CAISO minimizing time between the end of a policy process and development of Tariff Language. The larger lag time between the two efforts tends to create situations where issues/concerns raised in the policy discussion are not tracked into the tariff development process.

2. Provide your organization’s comments on section 6.5.2.3.7 Constraint Relaxation Threshold:

3. Provide your organization’s comments on section 6.5.2.3.8 Energy Bid Parameters:

4. Provide your organization’s comments on section 6.5.2.3.9 Hourly Shaping Factor:

5. Provide your organization’s comments on section 27.1.2.3 Ancillary Service Pricing - Insufficient Supply:

WPTF is concerned with the implications of having the Ancillary Service Scarcity Demand Curve Values when the Energy Pricing Parameters is based on the Hard Energy Bid Cap always set as a percentage of the $2,000/MWh Hard Energy Bid cap when the conditions specified in Section 27.4.3.3.4 (a) apply.

Section 27.4.3.3.4(a) states that when the infeasibility of supply meeting demand does not exceed the Constraint Relaxation Threshold, the software will relax the system energy balance constraint based on the maximum of the soft energy bid cap and the highest-priced cleared Economic Bid for price setting purposes. In other words, the power balance constraint penalty parameter in the pricing run will be based on the higher of those two factors, which may be less than the hard energy bid cap. Thus, under these conditions, the market may have the power balance constraint penalty parameter in the pricing run at, for example, $1,100/MWh based on the last highest-priced cleared Economic Bid yet the AS Scarcity Demand Curve Values as defined in the second table under Section 27.1.2.3.5 will be higher than the PBC penalty parameter. It is our understanding that this was not the intent of the policy as discussed in the stakeholder process; the intent of the policy was to have all the market parameters scaled based on the power balance constraint penalty parameter.

WPTF believes the Ancillary Service Scarcity Demand Curve Values when the Energy Pricing Parameters is based on the Hard Energy Bid Cap should be based on a percentage of the power balance constraint penalty parameter rather than always a percentage of the Hard Energy Bid Cap of $2,000/MWh.

Additionally, WPTF would like additional clarification on what the Ancillary Service Scarcity Demand Curve Values will be in the scheduling run.  

6. Provide your organization’s comments on section 27.4.3.3 Parameters Related to Hard Energy Bid Cap:

WPTF believes there is a sentence missing at the beginning of Section 27.4.3.3.2 that notes what the pricing parameter will be for relaxing transmission constraints under non-contingency related Transmission Constraints. Based on the prior stakeholder call, WPTF believes a sentence similar to the first sentence under Section 27.4.3.2.2 may also needed in this Section 27.4.3.3.2.

7. Provide your organization’s comments on section 27.4.3.3.4 Insufficient Supply to Meet CAISO Forecast of CAISO Demand in the RTM:

8. Provide your organization’s comments on section 30.5.8 Demand, Exports, Virtual Bids and Non-Resource Specific Resources above the Soft Energy Bid Cap and all relevant subsections:

9. Provide your organization’s comments on section 30.7.12 Validation of Bids in Excess of Soft Energy Bid Cap, Hard Energy Bid Cap, or Minimum Load Cost Hard Cap and all relevant subsections:

10. Provide your organization's comments on Appendix A – Definitions:

11. Additional comments on the FERC Order 831 – Import Bidding and Market Parameters second revised draft tariff language:

WPTF appreciates the CAISO’s consideration of these comments.