Thursday, February 21, 2019

NYISO Business Issues Committee Briefs: Jan. 16, 2019

By Michael Kuser

Approves Repricing Fixed Price TCC Credit Requirement

NYISO’s Business Issues Committee on Wednesday approved using the market clearing price to value and calculate the credit requirement for fixed-price transmission congestion contracts (TCCs).

Sheri Prevratil, NYISO corporate credit manager, told the BIC that the ISO will use $0 as the payment obligation portion of the requirement if the price calculated for the TCC is less than $0, but it will otherwise continue to use the greater of the payment obligation or the credit holding requirement until receiving payment for the contract.


The ISO’s overall TCC credit policy values such contracts for collateral purposes based on the most recent auction price, but the price paid for a fixed-price TCC does not determine the potential credit risk of that contract, she said.

The credit requirement is currently calculated based on the price paid for the TCC, not the market clearing price, and remains the same throughout the duration of the TCC.

If the change is approved by the Management Committee this month and the Board of Directors in March, the ISO will file with FERC in April for deployment in June 2019.

LBMPs Drop 7% in December, 30% Y-o-Y

NYISO locational-based marginal prices averaged $40.31/MWh in December, down by about 7% from November and slightly more than 30% from the same month a year ago, Robb Pike, director of market design and product management, said in the monthly operations report. Day-ahead and real-time load-weighted LBMPs came in lower compared to November.

Year-to-date monthly energy prices averaged $44.92/MWh in December, a 23% increase from a year ago. December’s average sendout was 425 GWh/day, compared with 411 GWh/day in November and 444 GWh/day a year earlier.

Transco Z6 hub natural gas prices averaged $4.10/MMBtu for the month, compared with $4.23/MMBtu in November and down 3.2% from a year ago.

Distillate prices dropped compared to the previous month and were down 7.3% year-over-year. Jet Kerosene Gulf Coast averaged $12.54/MMBtu, down from $14.50/MMBtu in November. Ultra Low Sulfur No. 2 Diesel NY Harbor was down to $12.84/MMBtu, from $14.72/MMBtu the previous month.

December uplift decreased to -29 cents/MWh from -27 cents/MWh in November, while total uplift costs, excluding the ISO’s cost of operations, came in higher than November.

The ISO’s 23 cents/MWh local reliability share in December dropped slightly from 25 cents the previous month, while the statewide share stayed the same at -52 cents.

The Thunderstorm Alert cost in New York City was $0/MWh, the same as in November.

Pike announced no updates to the monthly Broader Regional Markets report.

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