INITIATIVE:
Price formation enhancements

Started: Apr 11, 2022

Leads
James Friedrich

This initiative will explore several topics related to price formation in the California ISO markets focused on real-time market pricing. Scarcity prices are important to attract supply and incent resources to be available and perform. They are also important to provide appropriate price signals to reduce demand. Recent energy shortages and associated prices in the ISO real-time market have emphasized the need for the ISO to review and enhance its scarcity pricing provisions.  Consequently, the ISO plans to consider the following topics in this initiative: (1) enhance real-time market scarcity pricing to better reflect tight supply conditions, (2) consider fast-start pricing, and (3) enhance how the real-time market uses advisory prices to dispatch resources.

Status

Proposal Development Decision Implementation Completed/Closed
Phase 2
Dec 13, 2024 Comments due
Dec 16, 2024 Meeting, BAA level MPM
Dec 19, 2024 Meeting, Fast Start Pricing
Jan 09, 2025* Meeting, Scarcity Pricing
Jan 16, 2025* Meeting, Fast Start Pricing
Jan 23, 2025* Meeting, Scarcity Pricing
Jan 30, 2025* Meeting, Fast Start Pricing
Feb 06, 2025* Meeting, Scarcity Pricing
Feb 13, 2025* Meeting, Fast Start Pricing
Feb 20, 2025* Meeting
Feb 27, 2025* Meeting, Fast Start Pricing
Mar 06, 2025* Meeting, BAA level MPM
Mar 13, 2025* Meeting, Fast Start Pricing
Mar 20, 2025* Meeting, BAA level MPM
Mar 27, 2025* Meeting, Fast Start Pricing
Apr 03, 2025* Meeting, Fast Start Pricing
Nov 14, 2024 PRR 1591 updates to the hourly energy shaping factor
Implementation milestones
Phase 1
Jul 31, 2024 Order accepting tariff amendment (ER24-2168)
Jul 08, 2024 Answer to comments (ER24-2168)
May 31, 2024 Tariff amendment filing (ER24-2168)
Jul 11, 2024 Training
Aug 01, 2024 Production
Implementation milestones
Completed

Phase 2

Web meeting


Working Group Session 4 - Fast Start Pricing

Presentation - Price Formation Enhancements - Dec 05, 2024

Web meeting


Working Group Session 3 - BAA-Level Market Power Mitigation, Pivotal Suppliers and Impact Thresholds

Presentation - Price Formation Enhancements - Nov 20, 2024

Submit comments Due: Dec 13, 05:00 pm

Web meeting


Working Group Session 2 - Fast Start Pricing

Presentation - Price Formation Enhancements - Nov 14, 2024

Web meeting


Working Group Session 1 - BAA-Level Market Power Mitigation

Presentation - Price Formation Enhancements - Nov 06, 2024

Comment template for this session is on the working group session 3.


Price Formation Enhancements - Working Group Phase 2 - Schedule 2024-2025
Updated 12/04/24

Phase 1

Completed

Outcome statement: The effective trade date August 01, 2024, the ISO implemented the Price Formation Enhancements modifications to rules for bidding above the soft offer cap for resources, especially to allow resources with intra-day opportunity costs to reflect those costs in their energy bids. This implementation scope includes:
1) Revision of the cap on all Default Energy Bids (DEBs) from $1,000/MWh to $2,000/MWh (“Uncap the DEB”) for both Day Ahead (DA) and Real Time (RT). Generating resource energy bids are capped by max ($1000, DEB, adjusted DEB) for both DA and RT.
2) For energy storage resource registered as an LESR using a proxy value, ISO will cap their bids at max ($1000, DEB from internal system if available, 4th highest Maximum Import Bid Price (MIBP), highest cost-verified bid)
3) Modification of MIBP shaping factor formula based on the high-priced day SMEC only

Effective Trade Date August 16, 2024, the ISO implemented a modification of the MIBP shaping factor formula based on the high-priced day system marginal energy cost (SMEC) only.

Web meeting


Discussion Paper and Stakeholder Recommendations - Price Formation Enhancements - Sep 05, 2024

Presentation - Price Formation Enhancements - Sep 30, 2024

View comments


Price Formation Enhancements - Soft Offer Bid Cap Pre-Market Simulation Training


Presentation - Price Formation Enhancements - Soft Offer Bid Cap Pre-Market Simulation Training - Jul 11, 2024



Revised Draft Tariff Language - Price Formation Enhancements - May 20, 2024
Comment deadline extended to May 28, 2024.

Draft Tariff Language - Price Formation Enhancements - May 13, 2024
Rules for bidding above soft offer cap

View comments


Final Proposal - Price Formation Enhancements - May 17, 2024
Rules for bidding above soft offer cap


Notice of Decisional Classification - FERC 831 Soft Offer Cap - May 2024


Draft Final Proposal - Price Formation Enhancements Redline - May 7, 2024
Rules for bidding above soft offer cap

Web meeting


Working Group Session 18, Draft Final Proposal, Rules for Bidding above the Soft Offer Cap

Presentation - Price Formation Enhancements - May 2, 2024

Draft Final Proposal - Price Formation Enhancements - May 2, 2024
Rules for bidding above the soft offer cap

View comments

Web meeting


Market Surveillance Committee meeting

Web meeting


Working Group Session 17, Feasibility Assessment and Straw Proposal

Price Formation Enhancements - Feasibility Assessment and Straw Proposal - Apr 22, 2024
Straw Proposal and Feasibility Assessment on Rules for Bidding Above Soft Offer Cap

View comments


Issue Paper and Stakeholder Recommendations - Price Formation Enhancements - Rules for Bidding Above the Soft Offer Cap

Presentation - Price Formation Enhancements - Apr 23, 2024

View comments

Web meeting


Working Group Session 16, Analysis on Fast Start Pricing

Presentation - Price Formation Enhancement - Apr 8, 2024

Mike Cadwalader Comments Price Formation Enhancements Working Group Session 16 - Apr 8, 2024

View comments


Updated Price Formation Enhancements Working Group Schedule 2024

Web meeting


Working Group Session 15, Battery Storage Bidding and FERC
831

Presentation - Price Formation Enhancements Working Group - Mar 12, 2024

View comments

Web meeting


Working Group Session 14, BAA-Level Market Power Mitigation

Presentation - Price Formation Enhancement - Feb 21, 2024

Web meeting


Working Group Session 13, Workshop

Presentation - Price Formation Enhancement Workshop - Feb 12, 2024

Web meeting


Working Group Session 12, Scarcity Pricing Sprint 3

Presentation - Price Formation Enhancements - Jan 24, 2024

View comments

Web meeting


Working Group Session 11, Scarcity Pricing Sprint 2

Presentation - Price Formation Enhancements - Jan 17, 2024

Web meeting


Working Group Session 10, Scarcity Pricing Sprint 1

Presentation - Price Formation Enhancements Working Group - Jan 10, 2024

Web meeting


Working Group Session 9

Presentation - Price Formation Enhancement - Dec 12, 2023

Mike Cadwalader Comments Price Formation Enhancements Working Group Session 9 - Jan 11, 2024

Web meeting


Working Group Session 8

Presentation - Price Formation Enhancements - Nov 16, 2023

View comments

Web meeting


Working Group Session 7

Presentation - Price Formation Enhancements - Oct 25, 2023

Draft Final Proposal - Scarcity Pricing - Oct 05, 2009

Web meeting


Working Group Session 6

Presentation - Price Formation Enhancement - Oct 12, 2023

View comments

Web meeting


Working Group Session 5

Discussion Paper - Price Formation Enhancements - Sep 21, 2023

Presentation - Price Formation Enhancements - Sep 27, 2023

View comments

Web meeting


Working Group Session 4

Presentation - Price Formation Enhancements - Sep 14, 2023

Poll Results - Price Formation Enhancements - Sep 14, 2023

View comments


Revised Price Formation Enhancements Overview

Hybrid meeting


Working Group Session 3

Presentation - Price Formation Enhancement - Aug 17, 2023

Poll Results - Price Formation Enhancements - Aug 17, 2023

Chat - Price Formation Enhancements - Aug 17, 2023

Hybrid meeting


Working Group Session 2

Presentation - Price Formation Enhancements - Aug 10, 2023

Poll Results - Price Formation Enhancements - Aug 10, 2023

View comments

Hybrid meeting


Working Group Session 1

Presentation - Price Formation Enhancements - Aug 3, 2023

Poll Results - Price Formation Enhancements - Aug 3, 2023

View comments


Price Formation Enhancements Overview

Web meeting


Presentation - Price Formation Enhancements - Jun 26, 2023

Hybrid meeting


Presentation - Price Formation Enhancements - Mar 20, 2023

Web meeting


Presentation - Price Formation Enhancements - Dec 16, 2022

Web meeting


Presentation - Price Formation Enhancements - Nov 16, 2022

Web meeting


Issue Paper - Price Formation Enhancements

Presentation - Price Formation Enhancements - Jul 12, 2022

View comments

Web meeting


Powerex and Public Power Council Report - Importance of Fast Start Pricing in Market Design

GDS Associates Report - Efficient Market Prices During Tight Supply Conditions - Issues and Recommendations

Presentation - Price Formation Enhancements Workshop - Jun 9, 2022

Powerex Presentation - Price Formation Enhancements - Jun 9, 2022

Calpine Presentation - Price Formation Enhancements - Jun 9, 2022

Rev Renewables Presentation - Price Formation Enhancements - Jun 9, 2022

WPTF Presentation - Price Formation Enhancements - Jun 9, 2022