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Interim Market Power Mitigation

Application Filing | Expedited Approval Received

On June 14, 2024, the AESO filed an application for expedited approval of the Interim Market Power Mitigation Rules pursuant to Section 20.6 of the Electric Utilities Act (Act) with the Alberta Utilities Commission (AUC).

On June 19, 2024, the AUC issued Order 29093-D01-2024 approving the AESO’s Interim Market Power Mitigation Rules under Section 20.6(3) of the Act. Pursuant to Section 20.6(4) of the Act, subsection 2 of Section 206.2 of the ISO rules takes effect June 21, 2024 and the balance of the Interim Market Power Mitigation Rules take effect July 1, 2024.

The application, all associated appendices and Order 29093-D01-2024 can be viewed under Proceeding 29093 on the eFiling section of the AUC website. Click here to create a new account or log in to eFiling.

Please contact rules_comments@aeso.ca with any questions.

Purpose

To share with stakeholders the AESO’s plan and design to implement changes regarding the interim market power mitigation. The AESO will share key dates, relevant design details, ISO rule amendment information and other key training materials. A method for stakeholders to submit questions will also be made available. This engagement will be applicable to market participants directly or indirectly impacted by the interim market changes, and any other interested stakeholders.

Background

In March 2024 the Alberta government announced regulatory changes regarding economic withholding in the energy market, based on recommendations it received from the Alberta Electric System Operator and the Alberta Market Surveillance Administrator. Two new regulations, the Market Power Mitigation Regulation and the Supply Cushion Regulation, and ISO rule amendments will enable the policy changes. The first regulation implements a secondary offer cap on thermal offers of market participants with a five per cent or greater market share once a certain net revenue threshold has been reached in a month. The second regulation requires the AESO to direct long lead time assets online when the AESO’s supply cushion is forecasted to be below the specified threshold. The AESO will also be making ISO rule amendments to support the changes.

These changes are being implemented to address affordability and market power concerns which balance the mitigation of excessive exercise of market power with minimal interference with market functioning while also ensuring that generators are able to make a reasonable rate of return.

The measures are interim and are to be replaced with a different mitigation approach, which is to be consulted on in the final Restructured Energy Market design.

The rule changes to implement the interim market power mitigation will come into effect by July 1, 2024.

Application Filing | Expedited Approval Received

On June 14, 2024, the AESO filed an application for expedited approval of the Interim Market Power Mitigation Rules pursuant to Section 20.6 of the Electric Utilities Act (Act) with the Alberta Utilities Commission (AUC).

On June 19, 2024, the AUC issued Order 29093-D01-2024 approving the AESO’s Interim Market Power Mitigation Rules under Section 20.6(3) of the Act. Pursuant to Section 20.6(4) of the Act, subsection 2 of Section 206.2 of the ISO rules takes effect June 21, 2024 and the balance of the Interim Market Power Mitigation Rules take effect July 1, 2024.

The application, all associated appendices and Order 29093-D01-2024 can be viewed under Proceeding 29093 on the eFiling section of the AUC website. Click here to create a new account or log in to eFiling.

Please contact rules_comments@aeso.ca with any questions.

Purpose

To share with stakeholders the AESO’s plan and design to implement changes regarding the interim market power mitigation. The AESO will share key dates, relevant design details, ISO rule amendment information and other key training materials. A method for stakeholders to submit questions will also be made available. This engagement will be applicable to market participants directly or indirectly impacted by the interim market changes, and any other interested stakeholders.

Background

In March 2024 the Alberta government announced regulatory changes regarding economic withholding in the energy market, based on recommendations it received from the Alberta Electric System Operator and the Alberta Market Surveillance Administrator. Two new regulations, the Market Power Mitigation Regulation and the Supply Cushion Regulation, and ISO rule amendments will enable the policy changes. The first regulation implements a secondary offer cap on thermal offers of market participants with a five per cent or greater market share once a certain net revenue threshold has been reached in a month. The second regulation requires the AESO to direct long lead time assets online when the AESO’s supply cushion is forecasted to be below the specified threshold. The AESO will also be making ISO rule amendments to support the changes.

These changes are being implemented to address affordability and market power concerns which balance the mitigation of excessive exercise of market power with minimal interference with market functioning while also ensuring that generators are able to make a reasonable rate of return.

The measures are interim and are to be replaced with a different mitigation approach, which is to be consulted on in the final Restructured Energy Market design.

The rule changes to implement the interim market power mitigation will come into effect by July 1, 2024.

  • Final blacklines of proposed Sections 206.1 and 206.2 since May 21, 2024

    CLOSED: This discussion has concluded.

    Purpose

    The AESO is providing stakeholders with final blacklines of proposed Section 206.1 of the ISO rules, Interim Secondary Offer Cap (“Section 206.1”), and proposed Section 206.2 of the ISO rules, Interim Supply Cushion Directives (“Section 206.2”). The blacklines reflect changes the AESO has made from the drafts of Section 206.1 and Section 206.2 posted on AESO Engage on May 21, 2024.

    The AESO has made minor changes to Section 206.1 and Section 206.2 in response to stakeholder feedback and to ensure effective technical implementation of the requirements and objectives of the Market Power Mitigation Regulation and the Supply Cushion Regulation.

    The blacklines posted today will be filed with the AESO’s Application for Expedited Approval of Interim Market Power Mitigation Rules with the Alberta Utilities Commission (the “Application”). Clean versions of Section 206.1 and 206.2 will be available as appendices to the Application.

    Materials

    Can be found under AESO Materials > Final Blacklines - Proposed Sections 206.1 and 206.2 since May 21, 2024

  • Updated Draft ID 2024-005 and Final Templates

    CLOSED: This discussion has concluded.

    Purpose

    The AESO is providing stakeholders with an updated draft Information Document, ID #2024-005, Interim Supply Cushion Directives (“ID #2024-005”) and the final versions of the Estimated Cost Parameters and Physical Constraints Template and the Actual Incremental Costs Calculation Template (collectively, the “Templates”), which are appendices to ID #2024-005. ID #2024-005 supports proposed Section 206.2 of the ISO rules, Interim Supply Cushion Directives, which facilitates the requirements and objectives of the Supply Cushion Regulation, AR 42/2024. The AESO notes that the Actual Incremental Costs Calculation Template has not changed from the draft version posted on May 24, 2024.

    In the Letter of Notice accompanying the proposed Templates posted for Stakeholder comment on May 24, 2024, the AESO stated that it would post the Information Document supporting proposed Section 206.2, including the final Templates, no later than June 14, 2024.

    Under proposed Section 206.2 of the ISO rules, applicable pool participants will be required to submit estimated cost parameters and accurate physical constraints for an eligible long lead time asset using the Estimated Cost Parameters and Physical Constraints Template by June 21, 2024. The AESO is posting the final Estimated Cost Parameters and Physical Constraints Template so that applicable pool participants can be prepared to submit their estimated cost parameters and accurate physical constraints for an eligible long lead time asset as the AESO will request that subsection 2 of proposed Section 206.2 come into effect on June 21, 2024 in its expedited ISO rule filing with the Alberta Utilities Commission.

    ID #2024-005, including the Templates as appendices, will be posted to the AESO website on June 21, 2024. The final version of ID #2024-004, Interim Secondary Offer Cap (ID #2024-004), which supports Section 206.1 of the ISO rules, Interim Secondary Offer Cap, will be posted to the AESO website on July 1, 2024. Please note that ID #2024-004 may be revised from the version posted on AESO Engage on May 30, 2024 prior to final posting on the AESO website. The AESO also notes that ID #2024-004 and #2024-005 may be subject to updates post-July 1, 2024 implementation of Section 206.1 and 206.2 of the ISO rules; any updates will be communicated in the AESO’s weekly Stakeholder Newsletter.

    Materials

    Can be found under AESO Materials > Updated Draft Information Document 2024-005 and Final Templates


  • Draft Information Documents 2024-004 and 2024-005

    CLOSED: This discussion has concluded.


    Purpose

    The AESO is providing stakeholders with two draft Information Documents. ID 2024-004, Secondary Offer Cap, supports proposed Section 206.1 of the ISO Rules, which facilitates the requirements and objectives of the Market Power Mitigation Regulation, AR 43/2024. ID 2024-005, Interim Supply Cushion Directives, supports proposed Section 206.2 of the ISO Rules, which facilitates the requirements and objectives of the Supply Cushion Regulation, AR 42/2024.

    In the Letter of Notice accompanying the Proposed Interim Market Mitigation ISO Rules posted for Stakeholder comment on May 21, 2024, the AESO stated that it would post drafts of the information documents for Stakeholder awareness in late May 2024. The AESO is proving these Information Documents to assist Stakeholders in understanding how the AESO intends to implement Section 206.1 and Section 206.2. Please note that the draft Information Documents may be revised prior to final posting on the AESO website.

    Materials

    Can be found under AESO Materials > Draft Information Documents


  • Written Consultation on Proposed Templates to Support s. 206.2 of the ISO Rules | May 24 - June 3, 2024

    CLOSED: This discussion has concluded.

    Purpose

    The AESO is providing Stakeholders with two new proposed templates to support proposed Section 206.2, which facilitates the requirements and objectives of the Supply Cushion Regulation. The Templates will be appendices to the Information Document for proposed Section 206.2.

    In the Letter of Notice accompanying the Proposed Interim Market Mitigation ISO Rules posted for Stakeholder comments on May 21, 2024, the AESO stated that it would post the Templates supporting proposed Section 206.2 for Stakeholder comment. The AESO is now providing Stakeholders with a copy of its two proposed Templates:

    Written Consultation Materials

    Can be found under AESO Materials > Written Consultation | Proposed New Templates

    Stakeholder Feedback

    We value stakeholder feedback, and we thank you for sharing your perspectives with us. All stakeholder comments that were received are available in the Stakeholder Submissions section.

  • Stakeholder Information Session | June 11, 2024

    CLOSED: This discussion has concluded.

    Purpose

    The AESO is hosting the virtual information session from 9:30 a.m. to 12:00 p.m. for stakeholders to share final design details to implement changes related to the Market Power Mitigation and Supply Cushion Regulations. The session will provide an overview of the processes, reports and requirements developed to be in place by July 1, 2024.

    Registration

    Click here to register for the session.

    Materials

    Session materials can be downloaded here

  • Written Consultation on Proposed New and Amended ISO rules | May 21 - 31, 2024

    CLOSED: This discussion has concluded.

    Purpose

    The AESO is providing notice and seeking feedback from stakeholders on the development of the proposed new and amended ISO rules (and relevant definitions) to facilitate the Market Power Mitigation Regulation, and Supply Cushion Regulation. For additional information, please see the May 21, 2024, Letter of Notice.

    These Regulations require the AESO to make or modify ISO rules to facilitate the Regulation requirements and objectives by July 1, 2024. As a result, the AESO will be filing the Proposed Interim Market Mitigation ISO rules with the Commission on an expedited basis to ensure that the ISO rules will be in effect by July 1, 2024. The AESO expects to file these rules for approval by the Commission on June 14, 2024

    Written Consultation Materials

    Can be found under AESO Materials > .

    Stakeholder Feedback

    We value stakeholder feedback, and we thank you for sharing your perspectives with us. All stakeholder comments that were received are available in the Stakeholder Submissions section.

  • Stakeholder Information Session | April 18, 2024

    CLOSED: This discussion has concluded.

    Purpose

    The AESO held a virtual information session on April 18, 2024, for stakeholders on the market changes related to the Market Power Mitigation and Supply Cushion Regulations. This session provided an overview of the plan and design details for the AESO to implement the changes required to support the regulations, effective by July 1, 2024. There was an opportunity for stakeholders to ask questions during the session.

    Materials

    Are available under AESO Materials on the right-hand side of the page.

Page last updated: 18 Nov 2024, 01:48 PM