Inter-SC Trades (IST) Tutorial and Rule Set – Updated 11/07/2006
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Summary:
Inter-SC Trades Under MRTU, Tutorial and Rule Set, Version 1.3
Extract:
1. Introduction
Recently FERC approved in principle the California Independent System Operator Corporation's (CAISO's) conceptual proposal to establish settlement services for bilateral energy transactions at generation nodes within the CAISO control area and at aggregated pricing points. This order benefits customers by offering a settlement service for bilateral contracts.
In today's market design SCs must submit a balanced schedule to the CAISO. Inter-SC trades are used to help balance Scheduling Coordinators portfolio of forward energy schedules. The CAISO cannot run today's forward market until all SCs schedules are balanced.
Under MRTU, the CAISO will be eliminating the balanced schedule requirement and in so doing will be creating a forward energy market (i.e., SCs will be able to come into the forward market with unbalanced portfolios and bid to purchase and sell energy). With the introduction of a forward energy market, Inter-SC Trades are no longer needed to balance schedules and in fact are no longer an essential or required element of the market design. Their only role under a forward energy market is to provide a settlement service for bilateral energy contracts. The settlement service offered by Inter-SC Trades is optional in the sense that the counter-parties to a bilateral contract could elect to settle their bilateral contract outside of the CAISO settlement system.
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