For initial implementation purposes only, this NPRR proposes to increase the initial CRR Auction Capacity for the first six-month portion of the initial CRR Long-Term Auction Sequence from 60% up to 70% in order to mitigate potential system and market issues during the transition from the Annual CRR Auction to the CRR Long-Term Auction Sequence.
Reason:
ERCOT has proposed and WMS unanimously recommended the concept of an Urgent NPRR to temporarily adjust the CRR Auction Capacity for initial implementation of the CRR Long-Term Auction Sequence.
As discussed at the February 2013 WMS and Congestion Management Working Group (CMWG) meetings, prior sales of CRRs in 2013 from the annual 15% and 55% CRR Auctions have created a relatively large inventory of existing CRRs that would be difficult to re-auction and clear the market when only increasing the CRR Auction capacity to 60% (only 5% more network capacity for first CRR Long-Term Auction Sequence). This relatively small capacity is further impacted by the NPRR463 design change of different scaling factors for existing CRR inventories and creates an already over-sold model on some paths.
This was a "theoretical concern" that was confirmed recently when the NPR463 software from the vendor was used in an auction simulation, and due to the existing ERCOT inventory created violations on constraints and invalid CRR results. However, these violations did not occur in simulations with the model scale increased to 70%.