Imbalance Price Modifications TSC Modifications – Extraordinary Meeting 86 Dave Carroll, Trading Operations, SEMO 6th September 2018

Background Imbalance price calculated every 5mins, from which the 30 min Imbalance Settlement Price is derived Market Backup price is calculated after each Gate Closure for the Imbalance Settlement Period that most recently closed Highly automated due to continuous trading

Background @ 20:10 the Backup Imbalance Price for 21:30 is calculated 20:00 20:05 20:10 20:15 20:20 20:25 20:30 20:35 20:40 20:45 20:50 20:55 21:00 21:05 21:10 21:15 21:20 21:25 21:30 21:35 21:40 21:45 21:50 21:55 5 min 30 min Backup 50 48 52 55 @ 20:10 the Backup Imbalance Price for 21:30 is calculated

Background 20:00 20:05 20:10 20:15 20:20 20:25 20:30 20:35 20:40 20:45 20:50 20:55 21:00 21:05 21:10 21:15 21:20 21:25 21:30 21:35 21:40 21:45 21:50 21:55 5 min 50 46 55 57 60 47 48 52 30 min Backup 53 @ 21:00 the 5 minute Imbalance Price for 20:35 – 20:40 is calculated

Background 20:00 20:05 20:10 20:15 20:20 20:25 20:30 20:35 20:40 20:45 20:50 20:55 21:00 21:05 21:10 21:15 21:20 21:25 21:30 21:35 21:40 21:45 21:50 21:55 5 min 50 46 55 57 60 47 48 52 30 min 52.5 Backup 53 @ 21:00 the 30 minute average Imbalance Price from 20:00 – 20:30 is calculated

Current Process Imbalance Settlement Price Market Backup Price Market Management System (MMS) Imbalance Settlement Price Market Backup Price Most Recent Imbalance Price Not Available Not Available

Rationale for Modification Experience from SEM go-live and from market trial Unscheduled outages not specifically accounted for in the code (MOD_30_18) Scheduled outages may be more frequent and longer in duration during start of market (MOD_31_18) Need to improve transparency of what the Imbalance Price is at all times for Market Participants

Proposal Each day get the ex-ante price from the Day Ahead Market Convert this from an hourly to half hourly price Publish “backup to PMBU” prices on www.sem-o.com website If the Imbalance Settlement Price and Market Backup Price are not available 30 minutes after the end of the relevant Imbalance Settlement Period, then the “Backup to PMBU” price is effective and will be used in settlement Issue Market Message to participants

Pre-published Backup Imbalance Price based on DAM Proposed Process Imbalance Settlement Price Market Backup Price Pre-published Backup Imbalance Price based on DAM Most Recent Imbalance Price Market Management System (MMS) Not Available Not Available Not Available Not Available Not Available

Justification Improves resilience as a further backup Imbalance Price will be available before a previous Imbalance Price (which may be totally unreflective) needs to be used The “Backup to PMBU” price based on the DAM will be more reflective of prevailing prices where most trading occurs Market Participants will always be aware of what price is being used 30 mins after an Imbalance Settlement Period

Discussion Any Questions?