February 21, 2017
Good afternoon. Southern Company is excited to announce new changes to the Energy Auction and your interaction with it. As you may be aware, the Federal Energy Regulatory Commission (FERC) recently accepted a number of changes to the Energy Auction that Southern Company proposed in December of 2016. Three of these changes had been in effect for some time on a voluntary basis, but they are now part of the filed tariff:
- The cost-based cap for all offers submitted by Southern in the Energy Auction does not include a demand charge.
- The Southern Auction Administrator cannot access third-party data, except upon express permission of the Independent Auction Monitor (IAM).
- The IAM will continue to provide annual reports to FERC regarding the Energy Auction.
Two changes are new, however, and one will directly affect how you interact with the Energy Auction.
- Timing of the Hour-Ahead Auction: Currently, the Hour-Ahead Auction opens at 75 minutes prior to the beginning of the Delivery Hour and closes 60 minutes prior to the beginning of the Delivery Hour. As revised, the Hour-Ahead Auction will now open 85 minutes prior to the beginning of the Delivery Hour and close 70 minutes prior to the beginning of the Delivery Hour. This change will take effect for all Hour-Ahead Auctions beginning on February 23, 2017, for power flow HE 13 (Central). This means that the new timing window will first be used for the February 23 Hour-Ahead Auction that runs from 10:35 – 10:50 AM (Central).
- Historical Bid/Offer Posting: Currently, historical bids and offers by Auction participants are posted on a six-month delay. As changed, this information will now be posted on a four-month delay beginning with the next monthly posting. The information will continue to be available at http://www.southerncompany.com/about-us/energy-auction/historical-bids-and-offers.html
In addition to these changes, the following additional steps are being taken:
- Into GTC Auctions: In response to requests from participants, an auction system for the HourAhead Non-firm product and the Day-Ahead Firm Liquidated Damages (Firm LD) product deliverable into the Georgia Transmission Company (i.e., Into GTC) is now under development. Further details regarding the mechanics of these auctions and the planned commencement date will be forthcoming; however, the goal is to have the Into GTC auctions up and running by early June.
- Bid/Offer Spread: The criteria applicable to the posting of Energy Auction bid/offer spreads are being revised. Recall that the current criteria for spread posting require at least three unique bidders and at least three unique offerors in a particular auction (with a participant able to be both a bidder and offeror). Under the new criteria, a spread value will post when an auction has at least one unique buyer and one unique seller. The new bid/offer spread calculator will be operational beginning with the change in the Hour-Ahead Bid Period on February 23, 2017.
- Hour-Ahead Price Posting System: In an effort to further enhance transparency in the hour-ahead market, an electronic bulletin board is being implemented that reflects the average price of both purchases and sales by Southern of the hour-ahead “Into Southern” product. Postings will be made the day after the transactions occur (e.g., averages for all hour-ahead purchases and sales for each hour (124) of February 2 would be posted on February 3 by 2 PM Central. The price posting system will be operational beginning with the change in the Hour-Ahead Bid Period on February 23, 2017.
Southern Company looks forward to implementing these changes and additions. It is hoped that they will enhance market activity in the Southeast and the utilization of the Energy Auction and its electronic platform. As always, we value your input and appreciate your participation in the Southern Company Energy Auction.
Should you have any questions about these changes or about the Southern Company Energy Auction in general, please call or email the Southern Auction Administrator, April Gurley, at 205-257-2172 or firstname.lastname@example.org.