1 February, 2012 QMWG S&B Protocol Clarifications QSE-Requested Decommitment of a DAM Commitment ERCOT Mandy Bauld

2 Relevant Protocol References QRD Language QSE-Requested Decommitment of Resources and Changes to Ancillary Service Resource Responsibility of Resources (4)In the Adjustment Period, a QSE may request to decommit a Resource for any interval that is not a RUC-Committed Interval by indicating a change in unit status in the QSE’s COP. (5)A Resource cannot be decommitted for just a portion of a Day-Ahead Market (DAM)-Committed Interval, which is a one-hour interval. If a Resource that is decommitted for a DAM-Committed Interval, that one-hour DAM-Committed Interval is excluded from the calculation of any Day- Ahead Make-Whole Payment for that Resource. DAM Make-Whole Eligibility Language Day-Ahead Make-Whole Settlements (2) A QSE that has a Three-Part Supply Offer cleared in the DAM is eligible for Day-Ahead Make- Whole Payment energy cost compensation in a DAM-committed Operating Hour, if, for the Resource associated with the offer the generator’s breakers were closed for at least one minute during the DAM-committed Operating Hour.

3 NOT QSE Requested De-Commitment Treatment Slide 3 DAM COMMITMENT SNAP Status Snapshots COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) yes no Does Final SNAPSHOT for all DAM HOURS= 1 (on)? Change DAMCOMMITFLAG?

4 QSE Requested De-Commitment Treatment Slide 4 DAM COMMITMENT SNAP Status Snapshots COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) COP STATUS (0=OFF, 1=ON) no yes Does Final SNAPSHOT for all DAM HOURS= 1 (on)? Change DAMCOMMITFLAG to remove HE7?

5 Possible Outcome of removing Hour – DAM pays two Starts Settlements automated Eligibility for DAM Start-Up Determine contiguous hours of a DAM Commitment Is Resource offline for 5 minute in Adjustment period? Is Resource online for 1 minute during DAM Commitment? Eligible for Start-Up HE5–HE6 AND HE8-HE12 (2 starts) Slide 5 Hour DAM Committed Self Committed SELF DE-Committed Hour HE7 (resource goes off for at least 5 minutes during HE7) DAMCOMMITFLAG HE5 through HE6 DAMCOMMITFLAG HE8 through HE12

6 Possible Outcome of not removing Hour – DAM pays 1 start Settlements automated Eligibility for DAM Start-Up Determine contiguous hours of a DAM Commitment Is Resource offline for 5 minute in Adjustment period? Is Resource online for 1 minute during DAM Commitment? Eligible for Start-Up HE5–HE6 (1 start) Slide 6 Hour DAM Committed Self De-Committed SELF DE-Committed Hour (HE7) not removed from contiguous block. DAMCOMMITFLAG HE5 through HE12

7 Possible Outcome of not removing Hour – DAM pays Energy Settlements automated Eligibility for DAM Energy Determine contiguous hours of a DAM Commitment Is Resource online for 1 minute during DAM Committed Hour? Eligible for Energy HE5–HE12 Slide 7 Hour DAM Committed Self Committed SELF DE-Committed Hour (HE7) not removed from contiguous block. - The resource remains on for at least 1 min, paid for energy - The resource online < 1 min, not paid for energy DAMCOMMITFLAG HE5 through HE12

8 Decisions  If the resource was DAM-committed and fulfilled the DAM-commitment by actually operating in the hour, should the resource be considered for make-whole payment?  Yes: ERCOT to draft an NPRR to modify the language in If approved ERCOT would stop performing the QRD process  No: Leave the QRD rule in place (ERCOT will proceed with automation of a portion of the process, manual support still required daily) Consider whether or not the 2 nd startup resulting from the QRD should be prevented (potential for NPRR)