FAQ Archives - ESP III – November 2016 Auction
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FAQ-137:
In the webcast presentation dated August 22, 2016, you indicated a 2,432 MW PLC. What is this information based on?
The PLC (MW) is based on the five highest coincident peaks experienced by PJM in 2015 for SSO customers (i.e., non-shopping only) enrolled as of June 30, 2016. This number has not been weather adjusted. The MW-measure is the weighted average of: (1) MW-measure applicable to the first three auctions that include PIPP load; and (2) MW-measure in the last three auctions that provide supply for SSO customers only. Please see FAQs 124-126 for further information.The MW-measure is provided for reference purposes only. The amount of actual quantity to be delivered depends on many factors (e.g., migration of SSO customers).
11/03/2016 in Data
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FAQ-135:
Under the Master SSO Supply Agreement, how do we know whether our obligations to serve the load of SSO Customers include the load of PIPP Customers or not. Are the load related obligations the same between a tranche won in the first 3 auctions and a tranche won in the fourth and subsequent auctions?
No, the obligations of SSO Suppliers that won tranches in the first 3 auctions are different from the obligations of SSO Suppliers that won tranches in the fourth and subsequent auctions.As defined in the Master SSO Supply Agreement signed pursuant to winning bids in the first 3 auctions, the definition of “SSO Customers” includes PIPP Customers whereas in the Master SSO Supply Agreement to be signed under the fourth and subsequent auctions, the definition of “SSO Customers” has been amended to exclude PIPP Customers. Please see FAQ-106.
10/31/2016 in Supply Agreement
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FAQ-133:
The PJM Settlement Agreement before FERC dated June 15, 2016 under Docket EL05-121-009 (available here) establishes cost responsibility for charges or credits to transmission customers in the PJM region. The Settlement Agreement states in Section 2.2 (b) Rates and Charges for Covered Transmission Enhancements that “PJM shall collect from Responsible Customers through the PJM Tariff, as two separate line items on their bills: (i) the applicable Current Recovery Charges … and (ii) the applicable Transmission Enhancement Charge Adjustments…”. Will the charges or credits that will result from the Settlement Agreement be the responsibility of AEP Ohio or the SSO Supplier?
FERC has yet to render a ruling on the proposed Settlement Agreement in the above referenced FERC docket. The Settlement Agreement speaks for itself, and as this matter is still pending litigation, it would not be appropriate for AEP Ohio to comment any further at this time.
10/13/2016 in Rates , Supply Agreement
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FAQ-127:
Our credit ratings have been recently downgraded, and we are now restricted to bid at most 5 tranches based on the credit based tranche cap. We have participated in the past and have won more than 5 tranches that are associated with a supply period that includes the supply period of the current auction June 1, 2017 through May 31, 2018. What does this mean in regard to our participation in the upcoming auction?
The credit-based tranche cap is an overall cap across all auctions under ESP III. If the bidder has already won a number of tranches above the credit-based tranche cap and assuming the bidder was relying on its own financial standing, then the bidder will not be able to participate in the upcoming auction (assuming that no material positive change to the credit ratings of the bidder would occur prior to the qualification of bidders).If the bidder chooses to rely on the financial standing of another entity as guarantor for purposes of the auction, then the assessment could change depending on the creditworthiness of such entity.
08/26/2016 in CBP Rules
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FAQ-126:
Is the MW-Measure announced for the November 2016 auction applicable to SSO Suppliers that won tranches in the first three auction under AEP Ohio’s CBP and that continue to provide supply to PIPP customers or is it applicable to SSO Suppliers that have won or will win tranches in the last three auctions under AEP Ohio’s CBP and that provide supply for SSO customers only (and not PIPP customers)?
The MW-measure announced for the November 2016 Auction is intended to be representative of SSO Load as whole and apply to SSO Suppliers that won tranches or will win tranches in any auction under AEP Ohio's CBP. Therefore, the MW-measure is calculated as a weighted average of:a) The MW-measure applicable to tranches won by SSO Suppliers in the first three auctions under AEP Ohio's CBP and that continue to provide supply to SSO customers and PIPP customers. SSO Suppliers that won tranches in these auctions continue to provide supply for 49% of SSO and PIPP customers. The PLC share for SSO customers and PIPP customers for these 49 tranches is 1,274.49 MW or 26.01 MW/tranche. And:
b) The MW-measure applicable for tranches won by SSO Suppliers or that will be won by SSO Suppliers in the last three auctions under AEP Ohio's CBP and that provide supply for SSO Customers only (and not PIPP customers). SSO Suppliers that won tranches or will win tranches in these auctions will provide supply for 51% of SSO customers only (excluding PIPP customers entirely). The PLC for SSO Customers only for these 51 tranches is 1,157.70 MW or 22.70 MW/tranche.
Please see the table provided in FAQ 125. Thus, the MW-measure is calculated as a weighted average of the tranche sizes above, or:
= ( (26.01 * 49) + (22.70 * 51) ) / 100 = 24.32 MW/tranche.
Bidders are reminded that these MW-measures are calculated for informational purposes only. AEP Ohio does not represent that a tranche will have the loads announced or any particular value. The actual SSO Load will depend upon many factors including customer migration to CRES providers and weather conditions. Bidders are responsible for evaluating the uncertainties associated with the SSO Load for which they are responsible for providing supply.
08/22/2016 in Data
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FAQ-125:
Can you please clarify how the MW-Measure announced on August 22, 2016 was calculated?SSO Suppliers with Tranches won before March 2016
All Other SSO Suppliers with Tranches
CRES Suppliers Serving
PIPP Load# tranches
49
51
Shares
49%
51%
0%
SSO Customers (excluding PIPP)
Total
2,270.00
1,112.30
1,157.70
Shares
49%
0%
51%
PIPP Customers only
Total
331.00
162.19
168.81
Total PLC
Total
2,601.00
1,274.49
1,157.70
168.81
Per Tranche MW-Measure
26.01
22.70
N/A
Wtd. average MW-Measure (1% of total PLC)
24.32
The table above shows the calculation. The total PLC for SSO is the sum of:- 1,274.49, which is 49% of SSO customers and 49% of PIPP customers; and
- 1,157.70, which is 51% of SSO customers (and no percentage of PIPP customers).
This total is 2,432.19 (rounded to 2,432 MW). The MW-measure for a 1% tranche is then 1% of 2,432 or 24.32 MW.
08/22/2016 in Data
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FAQ-124:
The MW-Measure announced for the November 2016 Auction takes into consideration that supply for 51% of the PIPP Load is expected to be procured through a separate RFP auction process in Spring 2017. Supply for the entirety of the PIPP Load is expected to be procured through a separate RFP auction process in Spring 2018. What will be the effect on the PLC and MW-measure in the SSO auction of this further transition of PIPP customers?
The PLC associated with the SSO Auction will, by June 1, 2018, reflect the exclusion of 100% of the PIPP Load (17% procured through a separate RFP auction process in 2016, 51% procured in 2017, and 100% procured in 2018). Thus, the MW-measure, which is simply 1% of the PLC associated with SSO Load, will be calculated from a PLC which excludes PIPP load entirely and will be reduced accordingly.
08/22/2016 in Data