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Enron Mail |
Tom Hoatson, et al -
What would PJM say in response? What is their current thinking? Also, given that the FTR process may leave some FTRs "unfunded", this would seem to move people away from cash flow devices? How would PJM need to change so this doesn't happen? Jim Steve Walton@ECT 02/09/2001 09:30 AM To: James D Steffes/NA/Enron@ENRON cc: Tom Hoatson/NA/Enron@Enron;, Dan Staines/HOU/ECT@ECT Subject: Re: PJM doesn't pay EPMI on FTRs Jim, The PJM rules give monthly overcollection of congestion charges to those who pay the access fees (mostly the incumbent utilities) but simply short the FTR holder if there is an undercollection of congestion charges. In addition all the auction revenues go to reduce access fees. As a result, an FTR holder is at risk in any month when they congestion charge collections are smaller than payments due FTRs. The accounting is done on an hourly basis with any excess credited at the end of the month. I have attached the PJM FTR manual. The details of the settlement procedure are covered in Section 5. This procedure benefits the incumbents, since their transmission cost is reduced by both auction revenues and monthly excess collections but never at risk for undercollection. You have a gate that lets in benefits but keeps out risk. In New York, for all its other flaws, the under/over collection reconciliation works in both directions. This is fairer, but there could still be an annual shortfall. Contrary to advertisement, the simultaneous feasibility test used in the FTR auction does not guarantee the ability to fund the FTRs issued. To address this potential annual shortfall, we proposed for the e-trans tariff, that the auction revenues be held in escrow between auctions. If over the year, there was a net shortfall, it should be taken from the auction revenues before the credit is made to reduce the access fees. This means that the buyers get what they paid for. The payers of the access fees still get credit for the net gain (auction revenues + monthly collections - FTR payments), without shorting buyers of FTRs. Steve James D Steffes@ENRON 02/09/2001 08:04 AM To: Tom Hoatson/NA/Enron@Enron, Steve Walton/HOU/ECT@ECT cc: Subject: PJM doesn't pay EPMI on FTRs Isn't the problem that PJM is only obligated to pay for these "negative" FTRs as much as there is congestion revenues? What section of the PJM Manuals is involved. Jim ----- Forwarded by James D Steffes/NA/Enron on 02/09/2001 08:07 AM ----- Christi L Nicolay@ECT 02/08/2001 04:07 PM To: Tom Hoatson/NA/Enron@Enron cc: James D Steffes/NA/Enron@Enron Subject: PJM doesn't pay EPMI on FTRs EPMI bought some FTRs in PJM. PJM did not pay EPMI appr. $105,000 in Sept and $194,000 in Oct. PJM told Rebecca Grace at Enron that PJM is revenue deficient and, therefore, not required to pay. In Dec., EPMI was negative $177,000 and they charged us $191,000. Apparently, PJM charged us all the negatives, but did not pay us some of our positives because of the revenue deficiency issue. Tom--Do you know what the rules are about this? It seems unfair that we can be charges all the negatives, but not get our money on the upside. Let me know and you or I can call Andy Ott about this. (Tom Dutta is the commercial trader on this for EPMI.)
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