DOE DEPARTMENT CIRCULAR NO. DC 2005-11-010 AMENDMENTS TO THE WESM RULES November 11, 2005

Whereas, Rule 8.6.1 of the Wholesale Electricity Spot Market (WESM) Rules provide for the approval by the Department of Energy (DOE) of proposals for any WESM rules changes upon endorsement by the PEM Board;

Whereas, on September 9, 2005, the Interim Rules Change Committee has approved a resolution endorsing for approval before the PEM Board changes in the WESM Rules pertaining to the governance, procedure on rules change, and market operations including correction of clerical errors;

Whereas, after discussion, the PEM Board has resolved on September 27, 2005 to approve for endorsement to the Department of Energy (DOE) the abovestated changes to the WESM Rules;

NOW, THEREFORE, pursuant to its authority under the WESM Rules, the DOE hereby issues, adopts and promulgates the following amendments to the WESM Rule.

A. Amendments to the WESM Rules

1. Rule 1.4.2.7. (d) is amended to read -

 

"(d) Has not been employed by any electric power industry participant, or a company or body related to or associated with a WESM participant (as defined in clause 1.4.2.7 (c) ) within one year prior to nomination date; and

2. Rule 1.6.2 (c) is hereby deleted and intentionally left blank.

3. Rule 1.9 is amended to read as follows -

 

"Where the WESM Rules identify matters that are subject to review or consultation in accordance with the public consultation procedures, the PEM Board shall ensure that, as a minimum, the following procedures are followed:

 

a. The PEM Board shall publish in the market information website particulars of the matter toWESM Participantsand other interested persons, inviting written submissions concerning the matter to be made by a specified date."

4. Rule 3.5.4.1 (as amended) is further amended to read --

EachCustomermay submit a forecast in respect of each trading interval for each of its registered load facilities for each trading day of the week in accordance with the timetable. The forecast submitted by the Customer shall be used by theMarket Operatorin the preparation of Net Load Forecast if it is within the forecast tolerance range published by the Market Operator.

If the Customer fails to submit a forecast of its load facilities in accordance with the timetable or if the Customer forecast submitted is not within the published forecast tolerance range, the forecast prepared by theMarket Operatorat the node where the Customer is located shall be used.

Prior to the commencement of the spot market, the Market Operator, in consultation with WESM Participants, shall determine and publish the forecast tolerance range. The forecast tolerance range may be varied from time to time by theMarket Operator.

5. Rule 3.6.5 is amended to read -

From time to time, theSystem Operatorand the Market Operator shall investigate the scope for further development of the market dispatch optimization model beyond the minimum requirements specified in clause 3.6.1 and submit their recommendations in a report to the PEM Board for consultation with WESM Members.

6. Rule 3.9.6. is amended to read -

If, as a result ofload shedding, noex-anteprices can be determined or communicated within the timeframe specified in the timetable, or the calculated prices are believed to be in error, theMarket Operatorshall, as soon as possible, issue apricing error noticein accordance with clause 3.10.5

7. Rule 3.10.5 is amended to read --

In the event where noex-ante pricescan be determined or communicated within the timeframe specified by the timetable, or the calculated prices are believed to be in error, as a result ofload shedding, occurrence of constraint violation coefficients, or for any other reason:

a. TheMarket Operatormay, as soon as possible after the end of a trading interval, issue apricing error notice, in which case, the ex-post quantities and the ex post prices determined according to clause 3.10.7 shall also serve asex-antequantities andex-anteprices.

b. If nopricing error noticeis issued within the time specified in the foregoing paragraph, theex-post pricesand quantities shall serve asex-ante pricesquantities and shall stand irrespective of the outcome of any subsequent investigations or resolutions of any dispute.

c. Should the pricing error also includereserves, thereservequantity and price determined in the ex-post run shall serve as thereservequantity and prices.

8. Rule 3.10.6 is amended to read --

The ex-post nodalenergyprice for eachmarket trading nodeshall be determined as theshadow priceon theenergy balance equationfor that markettrading node, formed in accordance with clause 3.6.1.4 (c), in anex-post dispatch optimization  performed, in accordance with the timetable, to determine target dispatch levels for the end of that trading interval assuming:

a. theplant statusat the end of that trading interval as determined for theex-post dispatch optimizationor ifload sheddingoccured in that trading interval, the plant status which would have pertained at the end of thattrading interval, as indicated in the targets determined by theex-post dispatchfor thattrading interval;

b. Thegeneration offerswhich applied at the beginning of thattrading interval;

c. Theunrestrained loaddetermined frommetering data, or estimated, at the end of that trading interval, to apply at eachmarket network nodefor that trading interval.

9. Rule 3.10.7 is amended to read --

TheMarket Operator, in consultation withWESM participants  and subject to approval by the PEM Board, shall develop and publish procedures to be employed in clauses 3.10.6.(d) and (e) in establishing the network configuration and other constraints to be assumed for the determination ofex-post nodal energy pricesfor circumstances in which power system conditions materially change during the trading interval, with a view to ensuring that:

 

b. Theex-post pricesproduced in accordance with clause 3.10.6, properly and fairly represent conditions at the end of the trading interval

10. Rule 3.13.1.1 is amended to read --

Trading Participantswho sell electricity pursuant tobilateral contractsand wish thosebilateral contractsto be accounted for in settlements shall, after eachtrading day, in accordance with the billing and settlements timetable:

 

a. Submit a schedule to theMarket Operatorspecifying the MWH bilateral sell quantities at each relevantmarket trading node, in eachtrading intervalof thattrading day;

11. Rule 3.13.6 (a) is amended to read -

For eachtrading interval, the grossex-post energy settlement quantityfor eachmarket trading nodeshall be determined by theMarket Operatoras follows:

a. If themarket trading nodeis defined under clause 3.2.2.1 as lying in the boundary of the power system operated by theSystem Operator, the grossex-post energy settlement quantityfor the market trading node is the net metered flow into thepower systemoperated by theSystem Operatorthrough the associatedmeter;

b. If themarket trading nodeis defined under clause 3.2.2.2. as agenerator nodelying on the interface betweennetworks, apparatus or equipment operated by parties other than theSystem Operatorthe grossex-post energy settlement quantityfor the market trading node is the net metered flows through the associatedmeterfrom theGeneration Companyto theCustomerside of the meter; and

12. Rule 3.13.7 is amended to read -

For settlement purposes, the ex-ante energy settlement quantity for anymarket trading nodein anytrading interval, shall be determined by theMarket Operatorby adjusting the gross ex-ante energy settlement quantity for thatmarket trading nodeand anytrading interval, as measured in accordance with clause 3.13.5 or estimated in accordance with clause 3.13.6, for bilateral contract quantities notified to theMarket Operatorunder clause 3.13.1.1, or inferred by theMarket Operatorunder clause 3.13.1.1 and accepted as valid under clause 3.13.1.2 by:

13. Rule 3.13.6.16 is amended to read -

If the transactions required by clauses 3.13.14.2 (a), (b) and (d) in aggregate, result in a surplus or deficit remaining, this will be known as the netsettlement surplus.

14. Rule 3.14.7 is amended to read -

After theMarket Operatoris to be paid under clause 3.14.6 and in accordance with the schedule set in the billing and settlements timetable, theMarket Operatorshall pay to each WESM Member in cleared funds the settlement amount (if any) stated to be payable to thatWESM Memberin that WESM Member's final statement.

15. Rule 6.2.3 is amended to read -

Duringmarket suspension and intervention, theMarket Operatorshall impose anadministered priceto be used as basis for settlements.

Prior to the spot market commencement date, the Market Operator shall develop and publish the methodology for determining the administered price to be used during market suspension or intervention of the spot market. Said administered price is to be endorsed by the PEM Board for ERC approval.

16. Rule 6.5.1.1 (b) is amended to read --

TheSystem Operatorshall also:

1. Implement anyload sheddingin a manner consistent with thesystem security and reliability guidelines; and

2. To the extent possible, determine a rotatingoutageplan, and rotate anyload sheddingrequirements.

17. Rule 7.3.1.1 (i) is amended to read -

The dispute resolution procedures set out in this clause 7.3 apply to all disputes which may arise between any of the following:

as to:

 

(i) A dispute under or in relation to the rules and regulations issued by theERCandDOE  under the Act, where such rules and regulations provide that the dispute resolution procedures under the WESM Rules are to apply to any dispute under or in relation to that rules and regulations; or

18. Rule 8.2.2.2 is amended to read -

The principle applicable to the composition and operation of thePEM Boardas set out in clause 1.4.2 apply also to the composition of theRule Change Committee.

19. Rule 8.2.9 is added and will read -

a. Subject to clause 8.6.4.2, the Rule Change Committee will recommend for approval of the PEM Board a system of classification of changes to the WESM Rules.

b. Subject to approval by the PEM Board, the Rule Change Committee will develop and publish detailed guidelines and procedures to be employed in the consideration, approval, publication and effectivity of any proposed change to the WESM Rules. These guidelines and procedures will, as far as practicable, be consistent with the provisions of this chapter 8, provided, however, that the Committee may establish procedures, time periods and manner of publication and effectivity other than as stated in this chapter 8 depending on the classification of the proposed change.

20. Rule 8.5.4 is amended to read --

Approving and submitting proposed Rule change for approval

If the PEM Board concludes that the proposed change to the WESM Rules satisfies the criteria which are set out in clause 8.4.1 and that the processes and procedures set out in clause 8.4 have been duly followed, the PEM Board

a. shall submit the proposed change to the WESM Rules to the DOE for approval if the proposed change requires approval by the DOE under the classification system approved pursuant to clause 8.6.4.2; or

b. shall cause publication of the approved rule change, if the proposed rule change requires approval of the PEM Board only. The approved rule change will become effective after its publication on such date and for such period as the PEM Board determines.

21. Rule 8.6 is amended to read -

Approval of Proposed Rule Changes by the DOE

22. Rule 8.6.4.1 is amended to read -

If the DOE concludes that a proposed change to the WESM Rules is consistent with the Act and the public interest and satisfies the criteria which are set out in clause 8.4.1, it shall approve the amendment and cause its publication. The change to the WESM Rules approved by the DOE will take effect within fifteen days from its publication, or on such later date as the DOE, determines.

23. Rule 8.6.4.2 is amended to read -

Upon recommendation of the Rules Change Committee, the PEM Board shall ratify the classification system of rule change proposals developed by the Committee pursuant to clause 8.2.9 (a) that will delineate proposals requiring DOE review and approval vis-a-vis proposals that can be acted upon at the PEM Board level. This classification shall be approved by the DOE.

24. The definition of administered price under Rule 11 is amended to read -

Administered price. A price imposed by the Market Operator to the Trading Participants during market suspension and intervention to be used for settle

ments which price is determined in accordance with the methodology developed and published by the Market Operator and approved by the ERC.

25. The definition of Business Day under Rule 11 is amended to read -

Business day. Any day on which the spot market is open for business.

And the following clerical corrections:

1. Rule 3.8.1 is amended to read -

Prior to commencement of each trading interval, the Market Operator shall, in consultation with the Grid Operator, and in accordance with the timetable:

b. Prepare a forecast of the unrestrained net load expected at each market trading node for the end of that trading interval;

2. Rule 3.8.2.2 (b) is amended to read -

Load shedding or other directions issued by the System Operator during the trading interval;

3. Rule 3.11.1.2 (a) is amended to read -

Final dispatch offers and when applicable, reserve offers;

4. Rule 3.11.1.2 (e) is amended to read -

The identification of theTrading Participant submitting the dispatch bid or dispatchoffer

5. Rule 3.13.12 (a) is amended to read -

TheMarket Operatorshall calculate the line rental trading amounts for each transmission line in the market network model as:

a) The expected flow of energy out of the receiving node of the market network line as determined by the market dispatch optimization model multiplied by the ex-ante nodal energy settlement price at that node; less

6. Rule 3.13.14.1 is amended to read -

For each billing period, the Market Operator shall determine the settlement amount for each Trading Participant as the sum of the aggregate trading amounts for the trading intervals in that billing period, determined in accordance with clause 3.13.14.2: plus

7. Rule 3.15.7.1 (a) is amended to read -

Publishthesuspension notice; and

8. Rule 3.15.7.6 is amended to read -

If:

 

b) TheMarket Operatorhas issued a suspension notice to aWESM Member  due to a failure by the WESM Member to continue to satisfy the prudential requirements and in the Market Operator's reasonable opinion to the WESM Member is incapable of rectifying that failure for any reason.

9. Rule 4.4.2 is amended to read -

Subject to clause 4.4.3, Generation Company or Customer which is involved in the trading of energy shall not be registered as a Metering Services Provider for any connection point in respect of which the metering data relates to its own use of energy.

B. Effectivity

These amendments shall be effective fifteen (15) days following its publication in two (2) national newspapers of general circulation.

Adopted: 11 Nov. 2005

(SGD.) RAPHAEL P.M. LOTILLA
Secretary