Market Performance Report for May 2007 Alan Isemonger Manager, - - PowerPoint PPT Presentation

Board of Governors General Session July 18th - 19th, 2007

Market Performance Report

for May 2007

Alan Isemonger Manager, Market Information

2

Market Highlights

Hydroelectric generation has peaked With the exception of May 8th the Balancing Energy Market was subdued Average Ancillary Services prices rose Total inter-zonal congestion costs increased substantially

The full May Market Performance Report is available at http://www.caiso.com/1be8/1be8723649d20.pdf

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Hydroelectric Generation Capacity

Average hydroelectric generation peaked at 3,000 MW in May, while remaining well below production levels in previous years.

1000 2000 3000 4000 5000 6000 7000 1-Jan 15-Jan 29-Jan 12-Feb 26-Feb 12-Mar 26-Mar 9-Apr 23-Apr 7-May 21-May Week Beginning Average Hydro Generation (MW) 2007 Hydro Generation 2006 Hydro Generation 2005 Hydro Generation 2004 Hydro Generation

4

Balancing Energy Perspective

Red bars are balancing energy vs. total market volume. Balancing energy made up 2.8% of total energy consumed in April.

100,000 200,000 300,000 400,000 500,000 600,000 1-May 3-May 5-May 7-May 9-May 11-May 13-May 15-May 17-May 19-May 21-May 23-May 25-May 27-May 29-May 31-May Date MWh

Bilaterally Scheduled Energy CAISO Balancing Market Energy

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Real Time Balancing Energy Prices

There were only 101 instances of five-minute prices exceeding $250 in May as compared to 203 in April and 131 in March. Representing 1.13% of the total number of pricing intervals in the month. Further, 41 of these high price intervals, over 40%

• f the total, occurred on

May 8.

• 50

50 100 150 200 250 300 350 400 450 500 550 1-May 2-May 3-May 4-May 5-May 6-May 7-May 8-May 9-May 10-May 11-May 12-May 13-May 14-May 15-May 16-May 17-May 18-May 19-May 20-May 21-May 22-May 23-May 24-May 25-May 26-May 27-May 28-May 29-May 30-May 31-May Date Market-Clearing Price ($/MWh)

NP15 Settlement Price NP15 IHR Price

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Cost of Balancing Energy

May 7th and 8th had a large proportion of the high priced intervals this

• month. Over 50% of

costs on these days were incurred at prices in excess of $250 MWh For the month 21.8% of costs for balancing energy were transacted during intervals with prices greater than $250, with the balance below.

$0 $300 $600 $900 $1,200 $1,500 $1,800 $2,100 $2,400 $2,700 $3,000 1-May 3-May 5-May 7-May 9-May 11-May 13-May 15-May 17-May 19-May 21-May 23-May 25-May 27-May 29-May 31-May Date Cost, Thousands 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000 Balancing Market Volume, MWh Above $250 Inc Below $250 Total Inc Volume

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Ancillary Services Markets

Prices for Regulation Up and Spinning Reserve increased sharply by 139% and 201% respectively in May Due to inter-zonal congestion on the MEAD and PACI branch groups which caused lower priced bids to be skipped

5 10 15 20 25 30 35 40 45 2 9 16 23 30 6 13 20 27 3 10 17 24 3 10 17 24 31 7 14 21 28 5 12 19 26 Dec Jan Feb Mar Apr May 2007

Week Beginning $/MW RU RD SP NS

RU RD SP NS RU RD SP NS Apr 07 377 355 721 701 11.48 $ 8.26 $ 2.48 $ 1.10 $ May 07 367 356 740 739 27.49 $ 9.65 $ 7.45 $ 1.36 $

• 2.7%

0.2% 2.5% 5.5% 139.4% 16.9% 200.8% 23.3% Average Required (MW) Weighted Average Price ($/MW)

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RA Unit Commitment Costs

Total unit commitment costs (RA and FERC MOO) declined sharply in May to $1.2 million from 2.2 million in April. RA commitment costs in May were driven by a large unit

• utage around the 13th of the

month, and by the loss of the McCullough-Victorville transmission line which increased the SCIT nomogram requirements. Victorville-Lugo congestion and SCE Area requirements also contributed about 20 percent each to the total.

$0 $50,000 $100,000 $150,000 $200,000 $250,000 1-Apr 8-Apr 15-Apr 22-Apr 29-Apr 6-May 13-May 20-May 27-May System SP26 Cacacity Victorville-Lugo SCE Area SCIT South-of-Lugo Outage Other

9

FERC MOO Commitment Costs

FERC MOO commitments totaled a mere $14,000 for some System energy on May 1.

$0 $50,000 $100,000 $150,000 $200,000 $250,000 1-Apr 8-Apr 15-Apr 22-Apr 29-Apr 6-May 13-May 20-May 27-May System SP26 Cacacity Victorville-Lugo SCE Area SCIT South-of-Lugo Outage Other

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I nter-zonal Congestion Costs

Total inter-zonal congestion costs increased to $12.5 million in May from $5 million in April. Congestion was driven largely by Schedule Coordinators attempting to move cheap hydroelectric power from the Pacific Northwest into the CAISO control area. Outages, scheduled maintenance on transmission lines and related transmission de-rates also contributed to the high level of congestion this month.