Exhibit 99.441
ADJUSTMENT BIDS BIDDING PROCESS
I. Objective
Adjustment bids are offers to adjust generation output (up or down) and/or
intertie schedules (up or down) for the ISO to use in solving congestion.
These bids are price signals to ISO that indicate how much the participant
values transmission. These bids will not result in additional revenues;
they reflect the bidder's preference to generate (consume) less or more
for changes in zonal prices (values of congestion). This is similar to
asking the question: "Would I generate (consume) more or less power if the
energy price, after congestion, falls or rises to a certain price level?"
PX participants must bid adjustment bids via the trade application
following the instructions shown in pages 6-18 through 6-24 of the PX
Trade Application User's Guide and in accordance with certain rules
described below.
II. Basic Rules
Adjustment bids are allowed from generators, resources across the
interties, loads, and exports across interties. Adjustment bids from other
scheduling coordinators (trade ins and trade outs) are not allowed.
Adjustment bids are presented as a maximum of 11 p-Q pairs (points) and
must include at least two p-Q pairs. The minimum of the quantities given
in the p-Q pairs of an adjustment bid given by a resource must be less
than or equal to the initial preferred schedule (IPS) for that resource.
Similarly, the maximum of the quantities specified in the p-Q pairs must
be greater than or equal to the resource's IPS.
Adjustment bids associated with resources (generation and imports) must
have monotonically non-decreasing prices. For increments of energy above
the initial preferred schedule (IPS), the prices must be equal to or
greater than the MCP. For decrements of energy below the IPS, the prices
must be equal to or less than the MCP.
Adjustment bids associated with demand (loads or exports) shall have
prices that are equal to or greater than the MCP for decrements of energy
and prices equal to or less than the MCP for increments of energy.
A consequence of these requirements is that either the IPS for a resource
(demand) must be included as a quantity in one of the p-Q pairs for that
resource or the PX MCP must be included as a price in one of the
resource's p-Q pairs.
The adjustment bid should not include the ($0/MWh, 0MWh) point unless the
participant is willing to be moved all the way to zero. The trade
application shows a zero price but it is not an indication that the bidder
must use it.
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Adjustment bids across an intertie must use 50 cents steps around the PX
MCP. The maximum number of steps allowed are 5 up and 5 down.
Adjustment bids are valid only into the market into which they are bid,
day-ahead market or hour-ahead market. They will not be transformed into
supplemental energy bids. However, these bids are treated as standing bids
and could be used by the ISO in the real time market for Intra-zonal
congestion management and possibly to solve imbalances due to reliability
must run units committed by the ISO after 10 am of the day ahead.
The minimum MW output level and the maximum output level specified in the
bid must be achievable.
III. Examples
Following are four examples of adjustment bids: one for generation, other
for load, the third for imports and the fourth for exports.
Example 1: Generation Adjustment Bids
A generator has an initial preferred schedule of 100 MW at the PX MCP of
$20 in the PX's energy market. The owner of the unit decides to submit an
adjustment bid in which he offers to increase output by 20 MW and to
decrease output by 20 MW in steps of 10 MW quantity and one dollar price
increments.
Suppose that the generator's willingness to sell energy is as follows:
Price $/MWh Amount Willing to Sell
Any price < $18.00/MWh 80 MWh
---------------------- ----------------------
$18.00 80 MWh to 90 MWh
$19.00 Up to 100 MWh
$21.00 Up to 110 MWh
$22.00 Up to 120 MWh
Any price > $22.00 Up to 120 MWh
The generator should submit the following adjustment bid: (18.00,80),
(19.00,90), (21.00, 100), (22.00, 110), (22.00, 120).
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[CHART]
MWh $/MWh
80 18
90 18
90 19
100 19
100 21
110 21
110 22
120 22
120 22
Note that the generator's IPS is included in the p-Q pairs and that a
vertical segment of the adjustment bid curve goes through the point (PX
MCP, IPS) = (20.00, 100).
Now suppose that the generator's willingness to sell energy is as follows:
Price $/MWh Amount Willing to Sell
Any price < $19.00/MWh 80 MWh
---------------------- ----------------------
$19.00 80 MWh to 90 MWh
$20.00 Up to 110 MWh
$21.00 Up to 120 MWh
Any price > $21.00 Up to 120 MWh
The generator should submit the following adjustment bid:
(19.00,80), (20.00,90), (21.00, 110), (21.00, 120).
[CHART]
MWh $/MWh
80 19
90 19
90 20
110 20
110 21
120 21
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Note that the PX MCP is included in the p-Q pairs and that a horizontal
segment of the adjustment bid curve goes through the point (PX MCP, IPS) =
(20.00, 100).
Suppose that the owner wishes to submit an adjustment bid with only one
step for incremental energy (above its IPS), say one incremental step of
20 MW at 50 cents above the MCP. The bid would be (20.50,100),
(20.50,120). Conversely, the owner could decide to submit an adjustment
bid with only one step for decremental energy (below its IPS), say one
decremental step of 10 MW at 50 cents below the MCP. The bid would be
(19.50,90), (19.50,100).
Example 2: Load adjustment bids
Adjustment bids for loads should be presented in exactly the same way
except that the offers to decrease load will have prices at higher than or
equal to the MCP and bids to increase load will have prices lower than to
or equal to the MCP.
Suppose that a load has been selected to be served at 500 MWh in the PX's
energy market at the PX MCP of $20. The buyer wishes to offer adjustment
bids to adjust its demand 75 MW up and 75 MW down in steps of 25 MW (price
steps of 50 cents).
Suppose that the demand's willingness to buy energy is as follows:
Price Amount Willing to Sell
Any price > $21.50/MWh 425 MWh
---------------------- ----------------------
$21.50 425 MWh to 450 MWh
$21.00 Up to 475 MWh
$20.50 Up to 500 MWh
$19.50 Up to 525 MWh
$19.00 Up to 550 MWh
$18.50 Up to 575 MWh
Any price < $18.50 Up to 575 MWh
The demand should submit the following adjustment bid: (21.50, 425),
(21.00, 450), (20.50, 475), (19.50, 500), (19.00, 525), (18.50, 550),
(18.50, 575).
[CHART]
MWh $/MWh
425 21.5
450 21.5
450 21
475 21
475 20.5
500 20.5
500 19.5
525 19.5
525 19
550 19
550 18.5
575 18.5
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If the bidder wants to offer only to increase its load by 25 MWh if the
price falls $0.50/MWh, it would submit the following bid (19.50, 500),
(19.50, 525). Similarly, if the buyer would wish to decrease its load by
up to 25 MWh if the price rises by $0.50/MWp above MCP, it would submit
(21.50,475), (21.50,500)
Example 3: Adjustment bids for imports across an intertie
Assume a participant at a tie point such as Malin, has scheduled an import
of 1500 MWh as its IPS at the PX MCP of $20.00. Further suppose that the
amount that the participant is willing to import depends upon the price
that he would be paid at the scheduling point. According to the PX
Protocols, the price steps must be in $0.50/MWh increments about the MCP
(5 above and 5 below). In this case, the participant has the option of
bidding price steps at $17.50/MWh, $18.00/MWh, $18.50/MWh, $19.00/MWh,
$19.50/MWh, $20.50/MWh, $21.00/MWh, $21.50/MWh, $22.00/MWh and $22.50/MWh.
Suppose that the importer's willingness to sell energy is as follows:
Price $/MWh Amount Willing to Sell
Any price < $17.50/MWh 1250 MWh
---------------------- ----------------------
$17.50 1250 MWh to 1300 MWh
$18.00 Up to 1350 MWh
$18.50 Up to 1400 MWh
$19.00 Up to 1450 MWh
$19.50 Up to 1500 MWh
$20.50 Up to 1550 MWh
$21.00 Up to 1600 MWh
$21.50 Up to 1650 MWh
$22.00 Up to 1700 MWh
$22.50 Up to 1750 MWh
Any price > $22.50 Up to 1750 MWh
In this case: the offer would be expressed as (17.50, 1250), (18.00,
1300), (18.50, 1350), (19.00, 1400), (19.50, 1450), (20.50, 1500), (21.00,
1550), (21.50, 1600), (22.00, 1650), (22.50, 1700), (22.50, 1750).
The importer is not required to use all of the available prices in
submitting its adjustment bid. However, it is restricted to using the
prices in the five $0.50/MWh steps below the PX MCP and the five $0.50/MWh
steps above the PX MCP.
Example 4: Adjustment bids for exports
The adjustment bids for exports would take similar forms as for imports
except that the prices will go up for reductions and down for increases.
Suppose that an export has an IPS of 1500 MWh at the PX MCP of $20/MWh.
Further suppose that the willingness of the exporter to buy energy depends
upon the
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price at the scheduling point. The exporter is restricted to using the
following prices in developing its adjustment bid:
$17.50/MWh, $18.00/MWh, $18.50/MWh, $19.00/MWh, $19.50/MWh, $20.50/MWh,
$21.00/MWh, $21.50/MWh, $22.00/MWh and $22.50/MWh.
Suppose that the exporter's willingness to buy energy is as follows:
Price $/MWh Amount Willing to Sell
Any price > $22.50/MWh 1250 MWh
---------------------- ----------------------
$22.50 1250 MWh to 1300 MWh
$22.00 Up to 1350 MWh
$21.50 Up to 1400 MWh
$21.00 Up to 1450 MWh
$20.50 Up to 1500 MWh
$19.50 Up to 1550 MWh
$19.00 Up to 1600 MWh
$18.50 Up to 1650 MWh
$18.00 Up to 1700 MWh
$17.50 Up to 1750 MWh
Any price > $17.50 Up to 1750 MWh
Multiple steps: (22.50, 1250), (22.00, 1300), (21.50, 1350), (21.00,
1400), (20.50, 1450), (19.50, 1500), (19.00, 1550), (18.50, 1600), (18.00,
1650), (17.50, 1700), (17.50, 1750).
The exporter is not required to use all of the available prices in
submitting its adjustment bid. However, it is restricted to using the
prices in the five $0.50/MWh steps below the PX MCP and the five $0.50/MWh
steps above the PX MCP.
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