This Protocol Revision Request (PRR) revises the definition of Fuel Index Price (FIP) to correctly account for the timing difference between ERCOT’s application of the FIP in its systems (midnight to midnight) and the timing of natural gas prices reflected by the index (i.e., 10 AM to 9 AM). The fuel price index published in Gas Daily, in the Daily Price Survey, under the heading "East-Houston-Katy, Houston Ship Channel" for any particular day reflects natural gas prices available to users from hour ending 10 AM of the particular day to hour ending 9 AM of the next day (i.e., the normal "gas day"). This PRR also adds a new definition for the term "Gas Day."This PRR also proposes non-substantive administrative changes, such as correcting acronym and defined term usage and section references. These are shown below with the author "ERCOT Market Rules."
Reason:
Currently, the FIP is defined as the midpoint price expressed in dollars per million British thermal units ($/MMBtu), published in Gas Daily, in the Daily Price Survey, under the heading "East-Houston-Katy, Houston Ship Channel." However, this definition fails to recognize that the fuel index price effectively changes at hour ending 9 AM each day for current day. That is, the index price published today for gas delivered beginning at hour ending 10 AM today reflects actual gas trades made yesterday. Thus, the published index price represents the price for the "gas day", which goes from hour ending 10 AM on one day (the day of publication) to hour ending 9 AM on the next day (see graphic below). The current FIP definition fails to take this time differential into account because ERCOT’s settlement systems apply the FIP from midnight to midnight.
