[00:00:01]
UH, YEAH, I'LL GO AHEAD AND GET STARTED WITH, UH, GOOD MORNING.
UM, I'LL GO AHEAD AND GET STARTED WITH THE, UH, MEETING REMINDERS QUICKLY.
UM, YOU KNOW, WE ARE ALL FAMILIAR WITH DOING THIS, UH, WEBEX ONLY, BUT JUST REMEMBER, UH, AND BRITTANY'S ALREADY GOT THE MESSAGE IN THE CHAT.
WE ARE USING THE CHAT TO QUEUE FOR MOTIONS OR DISCUSSIONS.
SO PLEASE, UM, PUT YOUR INFORMATION IN THE CHAT AND WAIT FOR EITHER CAITLIN OR CLIFF TO RECOGNIZE YOU.
THEN, AS WE GET TO THE BALLOTING PROCESS TODAY, IF THAT HAPPENS, UM, PLEASE MAKE SURE TO UNMUTE YOURSELF AS WE APPROACH YOUR SEGMENT AND THEN MUTE AFTER YOU HAVE CAST YOUR VOTE.
AND THEN IF THE WEBEX ENDS FOR ANY REASON, GIVE US JUST A FEW MINUTES AND WE WILL GO AHEAD AND GET RESTARTED, UM, WITH THE SAME MEETING DETAILS, OR WE'LL SEND SOMETHING OUT TO THE LIST SERVE.
UM, AND WITH THAT, WE DO HAVE A QUORUM AND ARE READY TO GET STARTED.
[1. Antitrust Admonition]
UM, ANTITRUST ADMONITION IS ON THE SCREEN TO AVOID, AVOID RAISING CONCERNS ABOUT ANTITRUST LIABILITY PARTICIPANTS AND ACTIVITY SHOULD REFRAIN FROM PROPOSING ANY ACTION OR MEASURE THAT WOULD EXCEED S AUTHORITY UNDER FEDERAL OR STATE LAW.UH, FOR ADDITIONAL INFORMATION, YOU CAN SEE THE WEBSITE, I THINK WE CAN GET STARTED.
UM, SO WE HAVE A FEW ALT REPS FOR TODAY IN THE COOPERATIVE SEGMENT.
CHRISTIAN POWELL HAS ALT REP ERIC BLAKEY AT 10:00 AM AND THE MUNICIPAL, UM, SEGMENT.
UH, JOSE HAS ALTERNATIVE REP, UH, BOB WHITMEYER, UH, AND DAVID KEY HAS ALT REP DIANA COLEMAN.
AND THE, SO I THINK WE CAN GET STARTED WITH
[2. Credit Finance Sub Group (CFSG) (Possible Vote)]
THIS CREDIT FINANCE, UH, SUBGROUP ITEM.I BELIEVE WE HAVE, UH, A POSSIBLE VOTE FOR TODAY.
I THINK BRENDAN WAS BRINGING US BACK, UM, SOME MEMBER INFORMATION.
CAN YOU HEAR ME OKAY? YEP, I CAN HEAR YOU.
UH, I ONLY HAVE TWO, UH, ADDITIONAL MEMBERS.
THEY'RE JACKIE REKT FROM NATIONAL GRID UNDER INDEPENDENT POWER, AND JIMMY QUO FROM CPS UNDER THE MUNICIPAL.
UM, SO YEAH, IF YOU CAN PUT THAT ON THE BALLOT.
I, I, I'LL SEND THOSE NAMES TO YOU.
AND IS THIS JUST, DID WE DECIDE, THIS IS JUST KIND OF A STANDING, VOTING, VOTING ITEM EVERY MONTH FOR POSSIBLE NEW MEMBERS? YES.
UM, I GUESS WE CAN, I DON'T KNOW IF WE'RE GONNA HAVE OTHER VOTING ITEMS, BUT SHE MAY GO AHEAD AND PUT IT ON A COMBO BALLOT AND WAIT TILL THE END.
I'LL DEFER TO COREY OR, OR SUSIE OR BRITTANY.
WE CAN GO AHEAD AND RUN, UM, THAT VOTE, SINCE I'M THINKING THE PHASE TWO BRIDGING IS PROBABLY NOT GOING TO BE A UNANIMOUS VOTE.
UM, BUT CAN YOU, BRENDAN, CAN YOU ENTER THAT IN THE CHAT, UM, WHO WE'RE VOTING ON? BECAUSE I DON'T BELIEVE WE HAVE A DOCUMENT FOR THAT.
SO WE'RE WAITING ON BRENDAN, CAN YOU WRITE THAT INFORMATION INTO THE CHAT AND THEN I SEE WE HAVE A MOTION.
THE TWO NAMES THAT WE ARE ADDING TO THE, UH, CREDIT FINANCE SUBGROUP ARE IN THE CHAT.
UM, AND I THINK THAT'S JUST A MOTION TO APPROVE MEMBERSHIP AS PRESENTED.
AND DO WE NEED A SECOND, DIANA? HEY, KATIE.
REAL QUICK, IS JIMMY HO ON THAT LIST OF MEMBERS? I COULDN'T REMEMBER WHO ALL WAS ON THAT LIST WITH THE, WE DON'T, YEAH.
SHOULD WE BRING UP THE FULLEST? DO WE HAVE THAT HANDY? IT MIGHT BE HELPFUL.
HE, HE DID, BRENDA DID WRITE JIMMY IN THE, THE CHAT.
SO THE NAMES WE HAVE IN THE CHAT ARE, UM, JACKIE HOLT FROM NATIONAL GRID RENEWABLES, UM, IN THE INDEPENDENT POWER MARKETER SEGMENT, AND THEN JIMMY CLO FROM CPS AND THE MUNICIPAL SEGMENT.
[00:05:05]
IS THAT GOOD OR DO YOU WANT TO TRY TO GET A FULL LIST UP, DIANA? NO, THAT'S GREAT, CAITLIN.ALL RIGHT, SO, UH, THE MOTION IS TO APPROVE THE MEMBERSHIP WITH THOSE TWO ADDITIONS.
THANK YOU, UH, FOR PUTTING COREY, FOR PUTTING THOSE IN THE MOTION.
UM, I SEE, UH, WE GOT A MOTION FROM ME AND A SECOND FROM BOB.
SO IS THAT, I THINK COREY, WE'RE GOOD TO VOTE.
SO I KNOW WE HAD, WE HAD THE MOTION FROM IAN.
DID WE GET A SECOND? I KNOW DIANA HAD A COMMENT, BUT DID, DID WE GET A SECOND FROM OKAY.
YEAH, IT LOOKS LIKE WE HAD A SECOND FROM BOB IN THE CHAT.
ON THE MOTION TO ADD THESE TWO VICTIMS, I MEAN REPRESENTATIVES TO THE CFS G, WE WILL START UP WITH THE CONSUMER SEGMENT WITH MARK.
ONTO OUR CO-OPS, MIKE? YES, THANK YOU, EMILY.
I DON'T THINK CHRISTIAN'S ON THIS IS ERIC.
I DON'T BELIEVE WE'VE GOT CLIFF YET.
UM, I AM HERE ACTUALLY NOW, SO, AND I VOTE YES.
THANKS, COREY, OUR INDEPENDENT GENERATORS.
BRIAN SAID HE'S DRIVING, SO HE IS NOT ON THE WEBEX YET, BUT HE'S A YES, BUT I DOUBT YOU CAN COUNT THAT.
UM, BUT MAYBE WE CAN CIRCLE BACK TO HIM.
UNDER IPMS, JEREMY? YES, THANK YOU.
SORRY, I WASN'T VERY FLEXIBLE TODAY.
UH, MUNICIPALS, UH, BOB FOR JOSE.
I'M MORE FLEXIBLE, BUT STILL, YES.
THANK YOU BOB, UH, DIANA FOR DAVID? YES.
YOU SPOILER ALERT, IT PASSES UNANIMOUSLY.
GIVE ME A SECOND TO, UH, FIX THE BALLOT TO WHERE IT'LL STOP TREATING US AS A UNTRUSTWORTHY DOCUMENT.
I'LL PULL IT BACK UP HERE IN A SECOND.
COREY, DID YOU WANT US TO GO AHEAD AND MOVE ON THEN? OR DID YOU WANNA, DO YOU WANNA TABULATE WHILE WE'RE LOOKING? YEAH, YOU, YOU GUYS, YOU GUYS GO AHEAD AND MOVE ON TO OTHER THINGS.
I'LL, I'LL PULL IT UP HERE IN A SECOND.
I GOTTA REMEMBER HOW TO GO INTO SECURITY SETTINGS AND CHANGES.
IT'S, IT'S A MONDAY, SO, ALRIGHT, GOOD MORNING EVERYONE.
SO CAITLIN, THANKS FOR COVERING FOR ME THERE FOR A FEW MINUTES.
[00:10:01]
THAT[3. Phase 2 Bridging Options (Possible Vote)]
BEING SAID, WE'RE PICKING UP WHERE WE LEFT OFF FOLLOWING OUR LAST MEETING WITH PHASE TWO BRIDGING OPTIONS AND TRYING TO DEVELOP THE TAC RECOMMENDATION THAT WOULD BE PRESENTING TO, UH, THE RELIABILITY OF MARKETS COMMITTEE NEXT WEEK AND, AND ULTIMATELY THEIR RECOMMENDATION TO THE FULL BOARD AT THAT POINT IN TIME.SO THAT BEING SAID, UM, WE DID TASK, UH, DAVE MAGGIO WITH PROVIDING SOME ADDITIONAL ANALYSIS, UH, ASKED HIS GROUP TO PROVIDE SOME ADDITIONAL ANALYSIS THAT WAS POSTED, I BELIEVE IT WAS FRIDAY, UH, DURING THE DAY.
AND SO HOPEFULLY YOU'VE HAD A CHANCE TO TAKE A LOOK AT THAT AS WELL.
I BELIEVE IT WAS FRIDAY EVENING, ERIC GOFF POSTED SOME CONSOLIDATED COMMENTS FROM, UH, THE CONSUMER SEGMENT.
AND SO THOSE WILL, WILL ROLL THROUGH THOSE AS WELL.
AND THEN, UH, LASTLY, UH, LATE YESTERDAY EVENING, WE SAW SOME COMMENTS THAT WERE, UM, SENT OUT VIA THE ATTACK EXPLODER, UH, FROM VISTRA.
AND SO WE'LL, WE'LL TALK THROUGH THOSE COMMENTS, UH, ALSO AS, AS PART OF DEVELOPING OUR RECOMMENDATIONS TO THE RMC.
SO THAT BEING SAID, I THINK WHAT I'D LIKE TO DO IS GO AHEAD AND START WITH, UH, DAVE, UM, SO HE CAN PRESENT HIS ANALYSIS.
AFTER THAT, WE'LL GO AHEAD AND, UM, HAVE ERIC PRESENT THEIR, UH, DISCUSSION POINTS.
AND THEN AFTER THAT WE'LL UH, GET IAN, I THINK, TO TALK THROUGH THEIR, UH, ITEMS AS WELL.
AND THEN WE'LL MOVE ON TOWARDS TRYING TO COALESCE AROUND A SPECIFIC, UM, A SPECIFIC RECOMMENDATION AND ADDRESS HOW WE WANT TO PRESENT THAT TO, UH, THE RMC, UH, NEXT WEEK.
SO, DAVE, ARE YOU AVAILABLE? MA'AM? CAN YOU ALL HEAR ME? UH, YES, SURE CAN DAVE, AND IT LOOKS LIKE, UH, BY THE WAY, WE'VE GOT A HUNDRED PERCENT, UH, A HUNDRED PERCENT IN FAVOR AS COREY ALLUDED TO.
SO WE'VE GOT THE SPREADSHEET WORKING, BUT DAVE, IT'S ALL YOURS NOW.
ALL RIGHT, WELL, I'LL GIVE UH, COREY A SECOND TO, TO PULL UP THE PRESENTATION, AND I, I DO APOLOGIZE, YOU KNOW, I KNOW FOLKS WERE INTERESTED IN SEEING THIS MATERIAL AS EARLY AS POSSIBLE, UM, UNFORTUNATELY JUST TO, TO TRY AND GET IT TOGETHER AND CAPTURE THE SCENARIOS THAT THE FOLKS WANTED TO SEE.
WE WEREN'T ABLE TO GET IT POSTED UNTIL, I THINK IT WAS ACTUALLY SATURDAY MORNING CLIFF.
UM, BUT, UH, BUT HOPEFULLY FOLKS HAVE HAD A CHANCE AT LEAST TAKE A, A QUICK GLANCE AT IT, AND OF COURSE, WE'LL, WE CAN TAKE QUESTIONS TODAY, UH, I GUESS WITH THAT AS WELL, AND WE CAN, YEAH, THANK YOU, COREY, TO THE SECOND SLIDE.
UH, YOU KNOW, I KNOW THERE WAS SOME ADDITIONAL SCENARIOS THAT FOLKS WERE HOPING TO LOOK AT.
UH, WE REALLY WERE ONLY ABLE TO GET TO THE, THE TWO SCENARIOS, UH, THAT I HAD SAID THAT WE WOULD SPECIFICALLY MAKE SURE THAT WE, WE TRIED TO ADDRESS.
UH, HOPEFULLY I CAN SOMEWHAT SPEAK TO THE OTHER SCENARIOS AS WELL, EVEN THOUGH WE DIDN'T NECESSARILY GET, UH, A CHANCE TO ANALYZE THEM.
UH, I THINK MAYBE THERE'S SOMETHING WE CAN, UH, AT LEAST, UH, GUESS AT HOW THEY MAY HAVE MATERIALIZED.
UM, UH, WITH, WITH SOME OF THE OTHER IDEAS THAT WERE BROUGHT UP AT THE, THE MEETING ON THE 31ST, THE, I, I GUESS JUST TO, TO DO A BIT OF A RECAP, THE TWO SCENARIOS THAT WE SPECIFICALLY TRIED TO TACKLE WERE, UM, ONE SCENARIO WAS THE IDEA OF LEAVING A $10 PER MEGAWATT HOUR FLOOR AT A, EXCUSE ME, AT A RESERVE LEVEL OF 7,000 MEGAWATTS OR BELOW.
AND THEN THE IDEA WAS TO DERIVE AN ADDITIONAL FLOOR AT A RESERVE LEVEL OF 4,000 MEGAWATTS, BUT WITH THE IDEA OF, OF DERIVING IT SUCH THAT THE, THE OVERALL RESULT WAS SOMETHING SIMILAR TO WHAT WE HAD SEEN WITH THE ERCOT, UH, PREFERRED, UH, BRIDGING OPTION THAT WE HAD PRESENTED WITH THE, THE MULTI-TIER FLOOR.
AND, AND SO WE'LL GET TO WHAT THAT VALUE WAS, I THINK IN A COUPLE OF SLIDES HERE.
UH, THE OTHER, UH, TAC REQUESTED, UH, ANALYSIS WAS TO NOT NECESSARILY HAVE A FLOOR, BUT TO DO THE APPROACH OF DECOUPLING THE VALUE OF LOSS LOAD FROM THE SYSTEM WIDE OFFER CAP AND INCREASING THE VALUE OF LOSS LOAD THAT FEEDS INTO, UH, THE O RDC CALCULATIONS AGAIN, TO, UH, DERIVING THAT THE VALUE OF LOSS LOAD, THAT WE GOT A NUMBER SIMILAR TO WHAT WE HAD COME UP WITH, UH, WITH THE BACK CASH ANALYSIS WE DID FOR 2022.
UH, AND SO WE DID THOSE TWO APPROACHES.
UH, AND THEN I GUESS JUST AS A REMINDER, UH, THE, THE ERCOT PREFERRED OPTION IS THAT MULTI-TIER FLOOR OF HAVING A $20 PER MEGAWATT HOUR FLOOR AT 6,500 MEGAWATTS OR BELOW, AND THEN A SECOND TIER OF A $10 PER MEGAWATT HOUR, UH, FLOOR AT BETWEEN EFFECTIVELY THAT 60 507,000.
UH, MOVING TO SLIDE THREE, COREY, UH, AND I GUESS ACTUALLY THIS IS, THIS IS ESSENTIALLY SAYING THE SAME, UH, MATERIAL JUST IN, IN A SLIGHTLY MORE CONDENSED WAY.
SO IN FACT, ACTUALLY WHY DON'T WE, UH, JUST GO TO SLIDE FOUR, COREY.
[00:15:03]
SO YOU'LL SEE ON SLIDE FOUR, FIVE, AND SIX VERY SIMILAR GRAPHS.THEY'RE JUST LOOKING AT THE DIFFERENT CASES.
AND SO I'LL TAKE A LITTLE BIT OF TIME AND, AND JUST SORT OF LAY OUT WHAT IS, UH, ON THIS GRAPH, THEN YOU'LL, YOU'LL LOOK FAIRLY CONSISTENT WITH THE NEXT TWO SLIDES.
UM, THIS, AGAIN, WE'RE ACTUALLY STARTING WITH THE ERCOT PREFERRED OPTION.
UH, AND WHAT WE'RE LOOKING AT IS SOME GRAPHICS FOR BOTH 2020 AND 2022.
UH, WHAT DOES THIS IS SHOWING IS IN BLUE AND THE, IT'S VERY, UM, I GUESS, UH, LIGHT TO SEE, BECAUSE WE'RE LOOKING AT SORT OF THE FULL CURVE OF ONLINE O RDC PRICE ADDED RESULTS FOR BOTH OF THESE TWO YEARS.
AND WHAT YOU SEE IN BLUE IS EFFECTIVELY THE INTERVALS WHERE THERE WAS SOME ADJUSTMENT TO THE PRICE BECAUSE OF THE FLOOR.
NOW, BECAUSE OF THE, I GUESS, RELATIVELY LOW FLOOR PRICES AT HIGHER OR SOMEWHAT HIGHER RESERVE LEVELS, UM, IF YOU LOOK AT THE HOLE OF THE CURVE, YOU SEE, UM, IT LOOKS SORT OF LIKE JUST A LITTLE BIT OF A SLIVER THERE AT THE, AT THE BOTTOM OF THE GRAPH BETWEEN, UH, AROUND 6,000, UH, UH, TO 7,000 MEGAWATTS OF RESERVES IN, IN THE, IN THE X ACCESS.
UH, THAT'LL BE A LITTLE BIT MORE PRONOUNCED AS WE LOOK AT THE, THE NEXT COUPLE OF SLIDES, BUT, BUT THAT'S EFFECTIVELY WHAT WE'RE LOOKING AT HERE, SIMILAR TO THE GRAPHIC THAT, UH, WE HAD SHARED AND BLAKE HAD PRESENTED SOME OF THE PREVIOUS MEETINGS.
THIS IS JUST LOOKING AT THE, THE SORT OF FULL SHAPE OF THE CURVE.
NOW WHAT YOU SEE IN THE, UH, BOTTOM TABLE IS JUST A, A VARIETY OF STATISTICS WHERE IT'S BEEN BROKEN OUT BY YEAR AS WELL AS IT'S BEEN BROKEN OUT BY WHICH FLOOR IS HAVING THE IMPACT AND, AND RESULTING IN THE ADJUSTMENT.
SO, UH, FOR EXAMPLE, YOU CAN LOOK AT THAT ROW ONE WHERE IT TALKS ABOUT THE COUNT THAT IS THE COUNT OF ADJUSTED INTERVALS, UM, FOR THE FIRST STEP, FOR THE SECOND STEP, AND THEN FINALLY COMBINED AND IT'S BROKEN OUT BY A YEAR.
ALONG WITH THAT, WE HAVE THE AVERAGE INCREASE IN PRICE.
THE, UH, ESSENTIALLY THE, THE GIGAWATT HOURS THAT'S LOOKING AT THE ACCUMULATED SORT OF, UH, AMOUNT OF ENERGY FOR THE SKINNER AND SORT OF ACCUMULATED ACROSS ALL THE ADJUSTED INTERVALS.
THE, THE INCREASE REVENUE ASSOCIATED WITH JUST THE ENERGY PRICE IS THAT NEXT COLUMN.
THEN THE INCREASE OF REVENUE ASSOCIATED WITH, UH, HAVING ADDITIONAL, UH, UH, THE PRICE CENTER AND THE HEADROOM.
AND THEN FINALLY IS THE, THE TOTAL REVENUE INCREASE, WHICH IS JUST THE, THE SUM OF THE ENERGY REVENUE INCREASE IN THE, IN THE HEADROOM REVENUE INCREASE BROKEN OUT BY THE DIFFERENT FLOORS AND THE DIFFERENT YEARS.
UH, AND YOU'LL EFFECTIVELY SEE JUST IN THE BOTTOM RIGHT CORNER, THE, THE TOTAL REVENUE INCREASES FOR THE TWO YEARS, YOU'LL SEE THE, THE 501 MILLION AND THE 491 MILLION.
UH, I GUESS JUST WANTED TO CALL OUT THE, THE FOLKS WERE LOOKING AT, AT THE, THE 501 MILLION IS SLIGHTLY DIFFERENT FOR 2020 THAN WHAT WE HAD PRESENTED.
UH, WE ACTUALLY HAD SOME, SOME DIFFERENT FOLKS DOING THE ANALYSIS AND WE HAD A SLIGHTLY DIFFERENT TAKE ON HOW TO COME UP WITH THE BASELINE VALUE.
SO IT'S WITHIN ABOUT, I THINK, UH, 1.5 MILLION OF WHAT WE HAD PREVIOUSLY, BUT THAT IS A SLIGHTLY DIFFERENT NUMBER, ALTHOUGH I DON'T THINK IT REALLY CHANGES ANY OF THE, UH, THE STORY BEHIND, UH, THE ANALYSIS HERE.
SEE, UH, BILL, YOU HAD A QUESTION.
HEY, DAVE, CAN YOU REMIND US ON THE METHODOLOGY YOU GUYS FOLLOW, UH, TO DETERMINE THE PRICE CHANGES IN THE REVENUES? YOU'RE NOT CONSIDERING BEHAVIORAL CHANGE, RIGHT? YOU DON'T, I DON'T THINK YOU GUYS HAVE A COMMITMENT MODEL THAT WOULD ACTUALLY COMMIT MORE RESOURCES BASED ON PRICE.
SO THIS IS REALLY JUST DOING A BACKCAST THAT IS NOT PRESUMING ANY SORT OF CHANGES IN, UM, ANY BEHAVIOR THAT WE MIGHT SEE IN TERMS OF THE INCREASED COMMITMENT OR THINGS LIKE THAT.
IT IS SIMPLY LOOKING AT WHAT THE ADDERS WERE AT THESE DIFFERENT RESERVE LEVELS AND TAKING THE RESERVE LEVELS AS A GIVEN AND THEN APPLYING THE FLOOR AT, AT, YOU KNOW, TO THE DEGREE WE SAW, FOR EXAMPLE, IF WE WERE, UM, AT RESERVE LEVELS OF 6,000 MEGAWATTS OF ONLINE RESERVES AND THE PRICE WAS LOWER, THE PRICE ADDER WAS LOWER THAN UH, $20 PER MEGAWATT HOUR, WE SIMPLY INCREASED IT TO 20 MEGA $20 PER MEGAWATT HOUR.
SO THERE WAS NOT ANY SORT OF ANALYSIS OR, OR, UM, CONSIDERATION OF BEHAVIORAL CHANGES.
BUT, UH, CAN I, DO YOU ADD TO THAT? I HAD A FOLLOW UP REAL QUICK ON THAT.
THAT'S A MUCH MORE COMPLICATED SET OF ANALYSIS TO DO AND MODELING.
[00:20:01]
WE SHOULD PROBABLY ALL KEEP THAT IN MIND.CAVEATED, UM, WHEN WE TALK ABOUT THESE OPTIONS THAT THE TYPE OF ANALYSIS THAT, THAT YOU GUYS WERE LIMITED IN WHAT YOU COULD DO.
AND SO THERE'S NO BEHAVIOR CHANGES REFLECTED IN HERE, WHICH WOULD CERTAINLY CHANGE THE OUTCOME QUITE A BIT.
THE INTERESTING OBSERVATION, WHICH I THINK WE SEE IN ALL THE OPTIONS IS THAT 2020, WHICH WAS ACTUALLY THE WEAKER YEAR, SAW THE HIGHER AND HIGHER AMOUNT OF REVENUE COMPARED TO 22, WHICH WAS A STRONGER YEAR IN TERMS OF LOAD AND TIGHTNESS ON THE GRID.
SO I THINK THE, THE TAKEAWAY THERE, DAVE, IS THAT YOU'RE SEEING RELATIVELY HIGHER PRICES AT HIGHER RESERVE AMOUNTS, WHICH ARE DRIVING THE 20 VERSUS 22 OR MOST RESOURCES WERE ONLINE ALREADY.
I GUESS THAT'S WHAT I'M TRYING TO KIND OF FIGURE OUT IS WHY, WHAT, WHAT EXPLAINS THAT DIFFERENCE? AND I'M, I'M THINKING THAT MIGHT BE PART OF IT, IS YOU'RE GONNA GET MORE RESOURCES AT HIGHER RESERVE LEVELS IN 20, CUZ THEY WEREN'T COMMITTED VERSUS 22, EVERYTHING'S ALREADY ONLINE.
I THINK THE OTHER THING TOO, AND, AND YOU'LL SEE THIS A LITTLE BIT IN THE COUNT, IS WE SIMPLY SAW MORE INTERVALS IN 2020 WHERE WE ARE AROUND THAT.
UH, ACTUALLY IF YOU LOOK AT THE, UM, WELL IT'S TRUE BOTH OF THE TWO DIFFERENT FLOORS, SIMPLY JUST THE COUNT COUNTERS, WE SAW MORE TIME WHERE WE WERE AT THE RESERVE LEVELS BEING IMPACTED BY THE FLOORS.
SO IN THAT FIRST ROW, YOU CAN SEE FOR 2020, THE TOTAL NUMBER OF INTERVALS THAT WAS ADJUSTED WAS, UH, 9,622 INTERVALS AS OPPOSED TO 2022, THE NUMBER OF INTERVALS WAS ONLY 8,446.
SO, UM, IN FACT, WE ACTUALLY HAD MORE PERIODS IN 2022 AT LOWER RESERVE LEVELS, BUT SPECIFICALLY IN THE WINDOW OF RESERVES THAT WE'RE TALKING ABOUT, WE HAD MORE TIME, MORE SCANNER INTERVALS AT THE RESERVE LEVELS THAT ARE BEING AFFECTED BY THE FLOORS.
AND YOU'LL SEE THERE'S THERE BECAUSE OF SOME OF THAT, THERE IS SOME, UM, YOU'LL SEE DIFFERENT OUTCOMES I GUESS WITH SOME OF THE OTHER CASES THAT WE WERE LOOKING AT.
YOU SAID IT IN A MUCH BETTER WAY, UH, THAN I WAS TRYING TO CONVEY, BUT I THINK THAT'S RIGHT.
ALL RIGHT, SO WE'VE GOT COMMENTS FROM KENON AND, AND SHAMS. YEAH, I WAS JUST GONNA ADD, UM, BILL, IN ADDITION, UH, BECAUSE THIS IS A BACKCAST, IN ADDITION TO THE BEHAVIORAL CHANGES, IT ALSO DOES NOT CATCH ANY CHANGE IN RESOURCE MIX.
SO IF I WAS LOOKING AT NEXT YEAR OR EVEN THIS YEAR, THE SHARE, UH, THAT IS BATTERIES IS ACTUALLY SIGNIFICANTLY MORE THAN IT WAS IN 2022 OR 2020.
UH, SHAMS? UH, YEAH, CAN YOU HEAR ME OKAY? YES, SURE CAN.
UH, SO DAVE, IN 2022, YOU KNOW, IN THE LOW R T O L CAP, UH, INTERVALS, I'M ASSUMING THE SYSTEM LAMBDA WAS REALLY HIGH, YOU KNOW, AND THE SUM OF THE TWO PROBABLY REACHED THE CAP AND THAT'S WHY THE ADDERS ARE SO SMALL, BUT I SEE SOME BLUE DOTS THERE.
THAT MEANS YOU ACTUALLY RAISED THE ADDER, SO AREN'T YOU, UH, STILL CAPPING IT AT THE SYSTEM SYSTEM-WIDE ALPHA CAP AT 5,000? SO I WAS WONDERING WHY THERE ARE BLUE DOTS ON THAT PART OF THE GROUND? WE, YEAH, SO THE, WE STILL DO A CAPPING AT THAT PARTICULAR PRICE, SO, SO THE, YEAH, WE ENSURE THAT THE TOTAL PRICING, OUR ANALYSIS CAN'T EXCEED THE, CAN'T EXCEED THE, THE SYSTEM WIDE OFFER CAP OF 5,000.
SO THAT WASN'T INHERENTLY IN THIS.
SO YOU WILL SEE SOME SCENARIOS, AND IN FACT IT'S PROBABLY A LITTLE BIT MORE PREVALENT ON THE, THE NEXT SLIDE, BUT SOME SCENARIOS WHERE, UM, ESSENTIALLY BECAUSE OF THE ADJUSTMENTS, YOU'LL, YOU'LL SEE IT, IT DOESN'T NECESSARILY LINE UP PERFECTLY WITH THE FLOOR, BUT, BUT IN THIS ANALYSIS, JUST LIKE WE DO TODAY, WE, WE ENSURE THAT THE, THE TOTAL PRICE CAN'T EXCEED BY TOTAL PRICE.
I MEAN SYSTEM LAMBDA PLUS THE, OR AC ADDER PLUS THE RELIABILITY POINT PRICE ADDER, THE PROCESS ENSURES THAT THE TOTAL PRICE WHEN YOU INCLUDE ALL THE ADDERS CANNOT EXCEED THE $5,000 PER MEGAWATT HOUR.
SO LIKE WHEN THE R T L CAP IS NEAR $3,000, WE SEE SOME RADARS, YOU KNOW, TOWARDS ZEROS.
I'M ASSUMING NOW THE TWO COMPONENTS ARE ALREADY AT THE CAP, BUT HOW IS THERE A BLUE DOT THERE IF THE SUM OF THE ALL OF THEM IS ALREADY AT THE CAP? I THINK IT JUST LOOKS LIKE IT'S ZERO.
IT'S NOT EXACTLY ZERO AND THAT'S WHY YOU'RE STILL SEEING A BLUE DOT.
[00:25:02]
OKAY, I'LL HAVE TO THINK ABOUT THAT.CAUSE I THINK THAT IN THAT RANGE IT SHOULD BE AT THE CAP, BUT OKAY, I THINK ABOUT THANKS.
NOW, YOU KNOW, 2020, UH, WAS, YOU KNOW, OF COURSE PRE, UH, CONSERVATIVE OPERATIONS AND 2022 WAS POST.
SO BASED ON THOSE CHANGES AND BEHAVIORAL CHANGES, UH, CAUSED BY THAT, DO YOU THINK THAT 2020 WOULD BE MORE ATYPICAL MOVING FORWARD THAN, I MEAN 2022 WOULD BE MORE ATYPICAL MOVING FORWARD THAN 2020? UH, I GUESS I MIGHT, I HAVE TO THINK ABOUT IT, BUT I, I WAS THINKING THAT 2022 FELT A LITTLE BIT MORE REFLECTIVE BECAUSE OF THE FACT THAT IT SEEN SOME OF THE FUEL MIX CHANGES THAT THAT CANAN WAS JUST SPEAKING TO, AS WELL AS THE FACT THAT HAD, IT HAD ALREADY CONSERVATIVE OPTIONS BAKED INTO IT, THAT FELT LIKE A LITTLE BIT MORE OF A, UH, I GUESS OPERATIONALLY MORE CONSISTENT WITH WHAT WE WOULD SEE.
THE OTHER THING THAT SORT OF COMES TO MIND IS FROM THE POINT OF VIEW THIS, OF THIS ANALYSIS, 2022 ALSO ALREADY HAD SEVERAL CHANGES TO THE O R D C.
OBVIOUSLY WE HAD THE SWITCH TO THE BALL MOVING TO 5,000 AS WELL AS THE, THE MINIMUM CONTINGENCY LEVEL MOVING FROM 2000 TO 3000.
SO THE, THE THE 2022 NUMBERS SEEM A LITTLE BIT MORE, UM, UH, I GUESS CLOSER TO TO WHERE WE ARE, THERE WAS I THINK MORE ASSUMPTIONS THAT YOU HAVE TO BAKE INTO 2020, UH, BEING, UM, YOU KNOW, A, A DIFFERENT O RDC PARADIGM AS WELL AS SORT OF A DIFFERENT OPERATIONAL PARADIGM.
YEAH, THAT, THAT'S WHAT I THOUGHT.
THAT CLEARS OUT THE QUEUE RIGHT NOW, DAVE, IF YOU WANNA KEEP ROLLING.
ALL RIGHT, SO WE CAN, SO THAT, THAT'S AGAIN, WE, WE'LL MOVE TO THE NEXT COUPLE OF SLIDES AND WE'LL GET INTO THE, THE REQUESTED CASES.
AND AGAIN, THE, THE ANALYSIS IS GONNA LOOK SIMILAR, JUST THE, OR THE APPROACH, THE ANALYSIS LOOKS SIMILAR, BUT OBVIOUSLY THE RESULTS WILL CHANGE JUST ON THE, ON THE DIFFERENT WAYS OF DOING IT.
SO THE NEXT, UH, CASE THAT WE LOOKED AT WAS THE REQUEST TO LOOK AT GETTING RID OF THE FLOOR AT 6,500 THAT HAD BEEN PART OF ERCOT PROPOSAL AND INSTEAD CREATING A FLOOR AT FOUR, UH, 4,000 MEGAWATTS OF RESERVES AND COMING UP WITH THE FLOOR SUCH THAT YOU, WE, WE GOT SOME OVERALL REVENUE INCREASE RESULTS CONSISTENT WITH, UM, WHAT WE HAD SHARED WITH THE, THE PREFERRED OPTION.
AND WE FOCUSED ON TRYING TO ALIGN THAT SPECIFICALLY WITH 2022.
UH, AND SO IF YOU LOOK AT, JUST KIND OF JUMP ALL THE WAY TO THE BOTTOM RIGHT CORNER, UH, YOU SEE THAT KIND OF CAME UP WITH A, A NUMBER IN TERMS OF WHAT THE FLOOR WOULD BE AND, AND THAT IT IS, UH, IT'S ACTUALLY, I GUESS IN THE TOP, UH, TOP ROW HERE OF THE TABLE, THE FLOOR IS, UH, $1,550 PER MEGAWATT HOUR.
AND IF YOU HAD THAT FLOOR LEVEL AT 4,000 MEGAWATTS OF ONLINE RESERVES, YOU SAW A INCREASED NET REVENUE ASSOCIATED WITH OUR, UH, BACKCAST ANALYSIS FOR 2022, UH, JUST SHY OF 500 MILLION.
UM, I THINK ONE OF THE, THE BIG KEY TAKEAWAYS IS, UH, THAT THAT FIRST ROW, AND I GUESS THIS THE SOME DEGREE CAME TO MIND, I KNOW SHAMS YOU HAD HAD AN ADDITIONAL, UH, UH, ANALYSIS REQUEST THAT WE DID NOT HAVE AN OPPORTUNITY TO GET TO, BUT THAT WAS LOOKING AT THE, WHAT IF YOU, INSTEAD OF 4,000 HAD THE ADDITIONAL FLOOR AT 3,500 MEGAWATTS, UM, I WOULD GUESS THE RESULTS WOULD BE FAIRLY SIMILAR TO WHAT WE DID HERE FOR 35, I'M SORRY, FOR 4,000 MEGAWATT RESERVE LEVEL.
AND I THINK THE BIG KEY THING THAT WE SAW IN THIS IS, UH, OBVIOUSLY WHEN THERE'S A FLOOR AT 4,000, BECAUSE WE SPEND SO MUCH LESS TIME AT THOSE RESERVE LEVELS, YOU SEE A LOT, UH, LESS INTERVALS BEING ADJUSTED OVERALL, SPECIFICALLY AT THAT, UM, UH, BEING AFFECTED BY THAT, THAT FLOOR AT 4,000 MEGAWATTS.
AND ALONG WITH THAT, YOU DO SEE A LOT MORE, UH, VARIATION IN IN YEAR TO YEAR OUTCOMES, AT LEAST WITH THE, THE BACKCAST ANALYSIS LOOKING AT THESE TWO YEARS.
SO KIND OF THAT, THAT ENDED UP BEING SORT OF A, A FAIRLY, UH, BIG TAKEAWAY AND SOMETHING THAT STOOD OUT WITH DOING THIS A APPROACH.
AND IF YOU LOOK AT THE BOTTOM RIGHT, UH, AT THE TOTAL REVENUES COMBINED ACROSS THE TWO YEARS, UH, OBVIOUSLY WE HAD TUNED 2022 OR TUNED THE, THE FLOOR PRICE FOR 2022, SO
[00:30:01]
THAT IT ENDED UP BEING SOMETHING FAIRLY SIMILAR TO 500 MILLION.UM, IF YOU GO BACK AND THEN APPLY THAT SAME FLOOR TO 2020, YOU SEE A FAIRLY DIFFERENT RESULT, UH, WITH THE, THE VALUE BEING, UH, 347 MILLION, UH, FOR THAT YEAR.
AND OF COURSE, UH, AS WE WERE KIND OF TALKING ABOUT WITH THE PREVIOUS SLIDE AND JUST THE, THE REAL DIFFERENCE BEING THE NUMBER OF INTERVALS, OF COURSE FOR 2022, WE HAD A LOT LESS INTERVALS, UH, AFFECTED BY THE FLOOR JUST BECAUSE OF, OF COURSE, DID NOT HAVE THAT, UH, MANY PERIODS WHERE RESERVES WERE BELOW 4,000 MEGAWATTS.
UM, BUT OTHER THAN THAT, YOU KNOW, I THINK THE, UM, I THINK EVERYTHING ELSE IS SORT OF STRAIGHTFORWARD WITH THE, THE WAY THIS ANALYSIS WAS SHARED AND AS WE WALKED THROUGH WITH THE PREVIOUS SLIDE.
BUT, UH, BOB, YOU HAD A QUESTION? YEAH, THE FIRST ONE WAS, WHERE WAS MY UNMUTE BUTTON? BUT, UM, DAVE, ON THE PREVIOUS MEETING, I THINK WE HAD A CHART THAT SHOWED WHERE THE ADDITIONAL REVENUES WENT TO BY TECHNOLOGY TYPE.
DID WE DO THAT HERE AT THE 4,000 OR, I DON'T SEE IT IN THE DECK.
WE, I GUESS THE, LEMME SEE HERE.
UM, ON SLIDE SEVEN ACTUALLY IS SOMETHING SIMILAR WHERE WE TALK ABOUT THE PERCENT, UH, WE LOOK AT THE FUEL MIX OF FOUR, JUST THE INTERVALS BY THE DIFFERENT ONES.
SO I'LL GET TO THAT ON SLIDE SEVEN.
SORRY, I DIDN'T, I DIDN'T SEE IT THERE.
DAVE, CUE IS EMPTY, SO YOU CAN GO AHEAD AND KEEP ROLLING.
WELL JUST ASK YOU ONE MORE THING BEFORE I JUMP TO, TO THE NEXT CASE IS, UM, THIS IS SOMEWHAT AN, I THINK, UH, IN PART RELATED TO SEAN'S QUESTION ON THE PREVIOUS SLIDE.
UH, IF YOU LOOK AT, AND THIS IS, IS MORE PREVALENT FOR 2022, YOU SEE A NUMBER OF BLUE DOTS BELOW 4,000 MEGAWATTS OF RESERVES THAT WERE ADJUSTED BUT NOT AT THE CAP.
AND IN, IN CASE THAT'S JUST NOT CLEAR.
THAT'S IS EXACTLY WHAT CHUMS AND I WERE TALKING ABOUT WITH THE PREVIOUS SLIDE.
SO THAT WOULD BE CASES IN WHICH WE WERE INCREASING THE PRICE HER BECAUSE OF THE FLOOR.
BUT IN THE PROCESS OF ENSURING THAT THE TOTAL PRICE WON'T EXCEED THE $5,000 PER MEGAWATT HOUR, THERE IS AN ADJUSTMENT, BUT THE ADJUSTMENT ISN'T ALL THE WAY TO THE FLOOR.
IT JUST INCREASES IT, UH, SLIGHTLY UP UNTIL THE POINT AT WHICH YOU HIT THE, THE $5,000 PER MEGAWATT HOUR.
SO, UH, JUST AS FOLKS ARE LOOKING AT THAT, HOPEFULLY TO HELP SORT OF EXPLAIN WHY, YOU'LL SEE SOME BLUE DOTS BELOW THAT 4,000 LEVEL THAT ARE HIGHER THAN THEY, UH, WERE OR HIGHER THAN THE, UH, ORIGINALLY OBSERVED PRICE ADDED, BUT STILL LOWER THAN, UH, THE FLOOR BECAUSE OF THAT PROCESS OF ENSURING THAT THE TOTAL PRICE CAN EXCEED 5,000.
ALRIGHT, AND THEN WE GO TO THE NEXT SLIDE.
SO THIS NEXT CASE, A AS WE DISCUSSED THIS, THE CASE IN WHICH THERE IS NO SPECIFIC FLOOR, BUT INSTEAD THERE'S A DECOUPLING OF THE VALUE OF LOST LOAD FROM THE SYSTEM WIDE OFFER CAP, AND THEN AN INCREASE IN THE OF BALL VALUE TO THE POINT IN WHICH AGAIN TUNED TO SEE A OVERALL INCREASE IN REVENUE, UH, IN ALIGNMENT WITH THE 500 MILLION.
UH, OF COURSE THE ONE THING THAT STANDS OUT IS BECAUSE WE'RE CHANGING VA EFFECTIVELY, YOU SIMPLY SEE ALL, UH, ALL PRICE ADDERS, UH, INCREASE TO SOME SMALL DEGREE.
AND SO THERE'S REALLY NO GRAY DOTS UNTIL YOU GET TO THE POINT, UH, ON THE VERY, VERY FAR RIGHT WHERE, UH, ESSENTIALLY RESERVES ARE THE PRICE ADDERS EFFECTIVELY AT ZERO.
UH, AND SO AGAIN, YOU'RE REALLY NOT GONNA, IT'S ALMOST ALL BLUE HERE.
UH, AND BECAUSE THERE'S NOT FLOORS, WE DIDN'T START TO BREAK IT UP BY FLOORS.
SO ALL THE VALUES WE HAVE HERE ARE JUST THE, UH, TOTAL VALUES OR TOTAL VALUES FOR THE, THE, THE TWO DIFFERENT YEARS.
UM, THE ONE THING, UH, I GUESS WANTED TO NOTE THAT'S A LITTLE DIFFERENT ABOUT THIS TABLE IS BECAUSE OF THE FACT THAT WE'RE CHANGING VA AS OPPOSED TO APPLYING A FLOOR AT THE, UH, A FLOOR FOR THE ONLINE RESERVE PRICE EDITOR, THERE'S AN ADDITIONAL ROW OF INFORMATION HERE THAT'S THE, THE SECOND TO LAST ROW, AND THAT IS THE OFFLINE HEADROOM, UH, REVENUE INCREASE.
SO ONE OF THE AREAS OF INCREASED REVENUE WHEN YOU JUST INCREASED VAULT IS NOT ONLY TO CHANGE THE, THE REVENUES FOR, UM, ONLINE RESOURCES AND PRO EITHER PROVIDING ENERGY OR RESERVES, BUT IT ALSO INCREASES THE REVENUE ASSOCIATED WITH, UH, THE FOLKS WHO ARE PROVIDING OFFLINE RESERVES.
UH, AND SO THAT'S A COMPONENT OF IT NOW.
AND IN THIS CASE IT'S UH, IT'S 25 MILLION FOR 2020 AND, AND 31 MILLION FOR 2022.
[00:35:01]
AND THAT CONTRIBUTES TO THE OVERALL REVENUES.THE OTHER THING THAT STANDS OUT IS, UH, AND THIS IS SORT OF COUNTER TO WHAT WE SAW WITH THE PREVIOUS CASE, IS A, A BIGGER DIFFERENCE BETWEEN THE OUTCOMES FOR THE TWO YEARS LOOKING AT THE BACKCAST, AND AGAIN, OF COURSE RECOGNIZING THAT THIS DOESN'T ACCOUNT FOR ANY BEHAVIORAL CHANGES, BUT UNLIKE WHAT WE SAW FOR THE PREVIOUS CASE FOR THE BACKCAST OF 2020 AND 2024, THE VAULT CHANGE WE'VE SEEN, UH, WHEREAS THE 2022 IS AROUND THAT 500 MILLION, THE BACK CHANCE VALUE FOR 2020 IS SNIFFLY HIGHER THAN THAT AT 650 MILLION FOR, UH, ACROSS ALL THE REVENUE TYPES, UH, FOR THE YEAR.
UH, BILL, YOU HAVE A QUESTION? YEAH, DAVE, CAN YOU E EXPLAIN WHAT YOU GUYS DID WITH THIS ONE AGAIN, YOU SET VAULT TO WHAT, TO 56 70? YEAH, SO YOU, WE CH YEAH, YOU CHANGE VA TO THE, TO 56 70 WITHIN THE, THE O R D C CALCULATION, BUT THEN WE STILL ENSURE THAT THE TOTAL PRICE CAN'T EXCEED 5,000.
SO TODAY, YOU KNOW, WE TALKED ABOUT THIS, THE COUPLING TODAY, THE, THE VALUE OF LOST LOAD AND THE SYSTEM WIDE OFFER CAP ARE SET TO THE SAME VALUE.
UH, AND SO YOU CAN SORT OF INHERENTLY JUST ENSURE THAT THE, THE TOTAL PRICE CAN'T EXCEED THE, UH, THE, THE, THE $5,000 PER MEGAWATT HOUR IN THIS CASE.
WHAT WE'RE SAYING THAT USE A DIFFERENT BALL FOR PURPOSES OF CALCULATING THE PRICE ADDERS, THERE'S THE, IF, IF FOLKS LOOK AT THE, THE FORM, THERE'S ACTUALLY A, A, A VARIABLE CALLED V WITHIN THE O RDC CALCULATION THAT IS EQUAL TO, UM, VA LESS THE SYSTEM LAMBDA THAT THAT GETS APPLIED WITHIN THE CALCULATION.
WE ARE REPLACING THE 5,000 IN THAT FORMULA THAT WE WOULD HISTORICALLY USE WITH THE 56 70.
AND THEN HOW'D YOU COME UP HEARING AGAIN THAT THE TOTAL PRICE CAN'T EXCEED THE $5,000 PER MEGAWATT HOUR? HOW'D YOU COME UP WITH THE 56 70? THE 56 70 WAS SPECIFICALLY DERIVED.
SO WE DID SOME ITERATIONS TO CALCULATE OR OR TO COME UP WITH THE VALUE NECESSARY TO COME UP WITH FOR 2022, A TOTAL REVENUE INCREASE TO BE AROUND 500 MILLION.
SO WE ESSENTIALLY ASSUMED AN OUTCOME FOR 2022 THAT WE WANTED THE VALUE TO BE AROUND THAT 500 MILLION AND THEN DERIVE WHAT VA GOT YOU THERE.
AND THIS ONE, THIS, TO ME, THE RESULTS WERE PRETTY SURPRISING CUZ I WOULD ASSUME IT WOULD BE FLIPPED.
I WOULD'VE THOUGHT THE REVENUES WOULD BE HIGHER, UH, THAN 20.
BUT I GUESS IT'S PROBABLY THE SAME PHENOMENON WHERE, UM, WELL EVEN THE COUNT IS LOWER THOUGH.
YEAH, NO, THIS ONE'S STILL, WE'RE KIND OF CONFUSED ON HOW THE MATH TURNED OUT THE WAY IT DID FOR BILL.
I GUESS MY, YEAH, AND I THINK THAT'S, I THINK THAT'S FAIR.
I WOULD SAY MY BEST GUESS, JUST THINKING ABOUT IT WAS THE FACT THAT THIS WAS PRE-CON CONSERVATIVE OPERATION.
SO WE ACTUALLY HAD, AND, AND OF COURSE WE HAD THE, THE OLD O R D C OF, OF $9,000 SYSTEM WIDE OFFER CAP IN THE 2000 MEGAWATT, UH, MINIMUM CONTINGENCY LEVEL.
AND SO THAT WE WERE, AGAIN, NOT, NOT AT THE VERY LOW RESERVE LEVELS.
YOU OBVIOUSLY SEE SOME, SOME MORE CASES, YOU KNOW, FOR EXAMPLE, BELOW 4,000 MEGAWATTS OF ONLINE RESERVES.
BUT THAT WHERE YOU SEE I WAS, YOU KNOW, MAYBE LIKE THE 5,000 TO 6,000 OR 5,000 TO TO 7,000 MEGAWATTS OF RESERVES, YOU ARE SEEING MORE TIME IN THAT RANGE IN 2020 THAN WHAT WE HAD IN 2022.
SO KIND OF, UH, IF YOU'RE, YOU KNOW, KIND OF IN THAT, IN THE, THE ELBOW TO SOME DEGREE OF THE R R D C SHAPE THAT YOU SEE, THERE'S MORE TIME IN THAT SPECIFIC SPACE.
AND TODAY FOR THIS ANALYSIS FOR 2020, UH, YOU ACTUALLY DIDN'T RECALCULATE THE ACTUAL ADDRESS USING 5,000, UH, DOLLAR BALL.
YOU JUST KEPT IT AT THE 9,000.
WHAT, WHAT WAS ACTUALLY THE CASE WHEN YOU'RE DOING THE COMPARISON? SO WE ACTUALLY, SO WE FIRST, FOR, FOR 2022, WE JUST SORT OF TOOK THE ADDER AS IT WAS AND THEN REDACTED ALL THE PRICE ADDERS ASSUMING AVOL OF 56 70 YEP.
[00:40:01]
FIRST OFF, WE TOOK THE ORIGINAL RESERVE LEVELS, WE THEN CREATED A NEW BASELINE THAT'S EQUAL TO THE CURRENT O R D C.SO ESSENTIALLY CREATE A BASELINE FOR 2020 THAT'S TW THAT, THAT ASSUMED AVOL OF 5,000 AND A MINIMUM CONTINGENT LEVEL OF 3000, AND THEN CALCULATED THE INCREMENTAL REVENUE FROM THAT NEW BASELINE.
AND, AND THAT'S TRUE FOR ALL OF THE CASES THAT WE TALKED ABOUT, 2020 AND ALL OF THEM, WE CREATED A NEW BASELINE THAT ASSUMED TODAY'S O R D C AND THEN CALCULATED THE INCREMENTAL REVENUE FROM THAT BASELINE.
SO, UM, YOU KNOW, COULD ONE OF THE REASONS WHY, UM, THE TOTAL REVENUES IS GREATER FOR 2020 BE THAT THE SYSTEM LAMBDA WAS LOWER.
SO YOUR DIFFERENCE BETWEEN WALL AND SYSTEM LAMBDA IS ACTUALLY GREATER IN 2020 THAN 2022.
THAT MAY BE A SMALL COMPONENT OF IT, BUT I WOULD, YOU KNOW, TYPICALLY THE VOL MINUS SYSTEM LAMB THAT WE'RE TALKING ABOUT, YOU KNOW, 5,000 MINUS, YOU KNOW, 5,000 MINUS $30 VERSUS 5,000, MINUS $70 HAS A SLIGHT DIFFERENCE.
BUT, YOU KNOW, I WOULD NOT SAY THAT THAT WAS THE BIGGEST DRIVER.
MY, MY INTUITION ON THE BIGGEST DRIVER IS WHAT I WAS JUST TALKING ABOUT WITH, WITH BILLS THAT YOU, YOU'RE, YOU'RE SPENDING TIME CLOSER TO THAT ELBOW, UH, JUST BECAUSE 2020 WAS PRE-CON CONSERVED OPERATION.
BUT, BUT CH I MEAN, I I THINK YOU'RE, YOU'RE RIGHT, THAT WOULD HAVE SOME, ALTHOUGH I THINK IT'D BE MORE MINUTE IMPACT TO 2020 BEING LARGER JUST BECAUSE OF THE SLIGHTLY SMALLER ON AVERAGE SYSTEM LAMBDA.
BECAUSE I REALLY LIKE THE NEGATIVE CORRELATION, YOU KNOW, THAT, UM, THE HEIGHT OF THE MARKET, THE SMALLER THE ADDER, UM, SO THAT MAKES A LOT OF SENSE, YOU KNOW, THAT THAT'S, UH, VERY ATTRACTIVE FEATURE.
I MEAN, AND I'M WANTING TO MAKE SURE, IS THAT JUST A COINCIDENCE OR IS THAT SOMETHING, UH, THAT'S A FEATURE OF THIS, AND IF IT IS A FEATURE, THEN THIS WAS AN ATTRACTIVE ALTERNATIVE, YOU KNOW, IF YOU GET MORE ADDERS WHEN THE PRICES ARE LOW.
UM, AND HAVING SAID THAT, YOU KNOW, SO AT AT 6,500 MEGAWATTS, 7,000 MAG, UM, MEGAWATTS, DO YOU KNOW ROUGHLY WHAT THE AD AVERAGE AVERAGE, LET'S SORT OF MIMIC THE $10 AND $20? WAS IT CLOSE TO THAT OR WE REALLY CAN'T TELL.
UH, I GUESS I, I DON'T HAVE THAT DATA HANDY.
MAYBE WE CAN TRY AND DO THAT CALCULATION.
I WOULD GUESS THAT THEY WERE TYPICALLY, BECAUSE REALLY THE BALL INCREASE ISN'T SIGNIFICANT, UM, I WOULD GUESS THAT THE PRICES ARE GENERALLY BE BELOW THE FLOORS ON AVERAGE.
AND, AND TO YOUR, I'M SORRY, TO YOUR, TO YOUR POINT TOO, MY FEELING IS IT'S NOT NECESSARILY GUARANTEED TO BE A FEATURE OF THIS APPROACH SHAMS. I THINK IT'S MORE A FUNCTION AGAIN, OF THE, THE CHANGE IN, UH, OPERATION.
I, I, I JUST DON'T THINK I CAN SAY THAT THAT'S A, THAT THAT'S A FEATURE.
HEY, DAVE AND ERCOT, I APPRECIATE Y'ALL DOING THIS ANALYSIS.
UM, I, UM, WHAT I LIKE ABOUT IT IS, UM, IF YOU NOTICE ALL THE DOTS IN BLUE, UM, BECAUSE IT IS TAKING THE EXISTING, UM, YOU KNOW, ESSENTIALLY, ESSENTIALLY THE INPUTS DERIVED BY THE COMMISSION, I'M CHANGING ONE THING, SO IT'S STILL IN LINE.
GENERALLY, YOU COULD ARGUE WITH THE CURRENT COMMISSION'S POLICY HERE.
UM, AND FURTHERMORE, IT GIVES, UM, CONSUMERS, UM, INCLUDING BATTERIES WHEN THEY'RE BUYING THE OPPORTUNITY TO KIND OF RESPOND TO LOW AND HIGH PRICES.
UM, AND, UM, THE, THE ISSUE THAT WE HAVE WITH THE ER CAP PREFERR OPTION IS WE'LL GET INTO IN MORE DETAIL LATER, UM, IS JUST THAT, JUST THAT, UM, A PERSON CAN'T REASONABLY RESPOND TO A SMALL ADDER, UH, IN PRICE.
IT, IT'S ONLY FUNCTION IS, UH, JUST TO TRANSFER MONEY FROM BUYERS TO SELLERS.
AND WHILE I APPRECIATE THAT'S THE OBJECTIVE HERE, UM, I, UM, YOU KNOW, I DEFER TO, TO DO THIS IN A WAY TO THE EXTENT WE'RE GOING TO DO IT AT ALL IN A WAY THAT ALLOWS BUYERS TO, UH, RESPOND.
[00:45:02]
THANK YOU.I WAS JUST HOPING DAVE COULD SPEAK TO WHAT ADDERS ERCOT SAUL IN THE, UH, 6,500 TO 7,000 MEGAWATT RESERVE RANGE.
YEAH, IAN, I GUESS THAT THAT WAS SORT OF THE QUESTION, UH, JOHNS WAS ASKING.
I I GUESS WITH THE WAY THE GRAPH, I DON'T HAVE THAT DATA HANDY TO SHOW WHAT IT WAS SPECIFICALLY IN THAT RANGE.
WE CAN TRY AND GET THE KIND OF THE RAW DATA BEHIND THIS GRAPH AND, AND, AND SPEAK TO IT.
BUT I'M SORRY, I DON'T, I CAN'T SPEAK VERY EFFECTIVELY TO IT RIGHT NOW AT THIS MOMENT.
APOLOGIES I MISSED THAT PART EARLIER.
UM, BUT, AND I, AND I, AND I GUESS IT'S THE ONE THING I HAD SAID EDEN REGARDING THAT IS, YOU KNOW, REALLY IT'S A, IT'S A RELATIVELY SMALL SCALING.
UH, I MEAN ESSENTIALLY IT'S THE, THE 56 DIVIDED, THE 56 70 BALL DIVIDED BY THE, UM, 5,000 BALL THAT WE WOULD HAVE IN PLACE TODAY.
AND SO IT'S A RELATIVELY SALT SMALL SCALING.
SO, YOU KNOW, TO THE DEGREE WE, UM, SAW PRICES BELOW THE FLOORS, I WOULD PRESUME THAT MOST OF THOSE PRICES WOULD STILL BE BELOW THE FLOORS IN, IN KIND OF THAT RANGE WE WERE TALKING ABOUT.
UM, DAVE, BECAUSE MY THOUGHT WAS MORE ON, UM, UH, REALIGNING OR D C WITH ERCOT DESIRE FOR, UM, OPERATIONS RESERVE ADD, SORRY, RESERVES DURING OPERATIONS.
SO THAT, THAT DOES HELP MY THINKING.
UM, I HAVE, I GUESS A QUESTION FOR ERIC FOLLOWED BY A, UH, A COUPLE OF COMMENTS.
SO ERIC, YOU SAID THAT THIS WAS ALIGNED WITH WHAT THE COMMISSION ACTION, BUT THE COMMISSION HAS SPECIFICALLY NOT CHANGED BALL? YEAH.
UM, SO I, I'M, I'M NOT FOLLOWING THAT ARGUMENT.
MAYBE I CAN MAKE IT MORE CLEAR.
UM, ALL THIS IS DOING IS RAISING, UM, YOU KNOW, BY SUB MARGIN, UM, THE OTHER ACTIONS THE COMMISSION HAS ALREADY TAKEN IN, IN RESPONSE TO THE OVERALL INCENTIVES AND ALREADY SEE, SO IT'S, UM, YOU'RE RIGHT, IT'S MODIFYING ONE OF THE NUMBERS SO I CAN MAKE THAT MORE CLEAR.
BUT THE OVERALL SHAPE HERE IS CONSISTENT WITH THE, THE SHAPE THAT THEY DISCUSSED, UH, WHEN THEY, WHEN THEY TOOK PAST ACTION TO R D SEE IN, IN TERMS OF ITS, ITS SHAPE, IF NOT, BUT NOT ITS MAGNITUDE.
UM, AND, AND THEN I'VE GOT, UH, A COUPLE OF COMMENTS.
I DO THINK, UM, THAT, UH, LO INTERRUPTABLE LOAD CAN, UH, RESPOND BETTER IN, IN THIS CIRCUMSTANCE.
AND BATTERIES ARE, UH, MORE LIKELY TO, UH, CORNER MORE OF THE REVENUES FROM THIS.
HOWEVER, THAT COMES AT A COST, AND THAT IS THAT OTHER RESOURCES THAT YOU NEED ONLINE DON'T GET THE REVENUES.
AND THERE'S A COST SHIFTING FROM INTERRUPTIBLE LOAD LIKE DATA CENTERS AND, UH, OTHER PROCESS INTERRUPTION LOAD TO RESIDENTIAL LOAD IF THE REVENUE STAYS THERE OR THE REVENUE GOES DOWN.
SO THERE ARE REAL TRADE OFFS HERE BETWEEN THIS PROPOSAL AND, UM, THE PROPOSAL THAT WE LAID OUT.
SO I THINK WHAT YOUR GOALS ARE MATTER.
YEAH, IF I CAN RESPOND TO THAT, SINCE YOU MENTIONED RESIDENTIAL CONSUMERS, UM, I I DON'T THINK THAT'S TRUE.
UH, RESIDENTIAL CONSUMER THAT IS ON A DEMAND RESPONSE PROGRAM CAN RESPOND TO HIGHER PRICES IN THAT RESPONSE PROGRAM.
UM, THERE'S, UM, YOU KNOW, THAT'S A, A SEGMENT OF THE MARKET THAT IS GROWING, UM, AND IT'S JUST NOT, UH, CORRECT TO ASSUME THAT THIS IS TRANSFERRING THAT COST TO THEM.
IT, YOU'RE, YOU'RE RIGHT, IT'S, UM, IT'S CHANGING THE MIX OF, OF WHO, WHO GETS WHAT.
BUT, UM, WE DON'T INCREASE THE OVERALL REVENUE TARGET JUST BECAUSE PEOPLE DO DEMAND RESPONSE.
IT JUST RE REDUCES REVENUE THAT WOULD OTHER OTHERWISE BE EARNED BY SOMEONE.
SO LET'S SAY, UH, I, I'M, I DON'T AGREE WITH YOU BASED ON THE TARIFFS THAT I'M AWARE OF IN THE RESIDENTIAL SECTOR FOR INTERRUPTABLE RESIDENTIALS, HOWEVER, LET'S SAY THAT YOU'RE RIGHT, THEN THERE'S AN EVEN BIGGER TRANSFER OF COST
[00:50:01]
TO RESIDENTIAL CUSTOMERS THAT ARE NOT ON A DEMAND RESPONSE TARIFF.H HOW IS THERE A TRANSFER OF COST IF IT JUST INCREASES THE AMOUNT OF RESERVES? SO, SO THAT'S THE, THAT WAS THE OTHER PART OF WHAT I SAID, OR YOU DON'T GET THE REVENUE TO RESOURCES THAT YOU'RE GOING FOR.
SO ONE, ONE WAY OR ANOTHER, UM, THIS, UH, MISS IS, UH, AT LEAST ONE OF OUR OBJECTIVES WAS THE POINT I WAS TRYING TO MAKE.
SO, UH, SO, SO IF, IF YOU WANT, UM, KIND OF LESS ROCK AND, UM, SOME REVENUE TO KIND OF TRADITIONAL GENERATION, UM, LET'S SAY WHAT YOU SAY EXACTLY PLAYS OUT, THEN THERE'LL BE LESS REVENUE TO THOSE RESOURCES, UM, AS A RESULT IN, IN OTHER WORDS, YOU'RE FORCING PEOPLE TO BUY POWER AT A PRICE THAT CAN'T AVOID.
NO, UM, I'M ACTUALLY GETTING THEM TO BUY RELIABILITY THAT THEY WANT.
UM, I, I APPRECIATE THE POINT YOU'RE MAKING, UM, BUT JUST TO TRY, TRY TO REPHRASE WHAT I SAID IN ORDER TO MAKE IT EVEN MORE CLEAR, UM, IF, IF IT'S A FIVE OR $10 ADDER, UM, THEN IT IS AN UNAVOIDABLE COST FOR ALMOST EVERY CONSUMER IN THE STATE.
UH, WHEREAS, UH, IN THIS SCENARIO AT LEAST, UM, SOME OF THOSE CONSUMERS CAN CHOOSE TO, UH, AVOID THAT COST THROUGH A DEMAND RESPONSE PROGRAM OR THEIR OWN ACTIONS.
UM, SO THAT'S THE PART I'M TRYING TO MAKE.
I, I APPRECIATE THAT WHEN PEOPLE CHOOSE NOT TO BUY POWER, IT REDUCES REVENUE TO PEOPLE THAT ARE SELLING POWER.
UM, WE'LL GO ON TO IAN, FOLLOWED BY NED.
UM, ERIC, UNDERSTAND YOUR THOUGHTS.
UM, ONE POINT I WOULD LIKE TO POINT OUT THOUGH IS, UH, RESIDENTIAL CONSUMERS SHOULD BE IMPACTED BY, UH, THE MARKET'S INTERPRETATION OF THIS, NOT BY THE ACTUAL REAL-TIME AMOUNTS.
UM, SINCE RESIDENTIAL CONSUMERS ARE NO LONGER ALLOWED TO BUY, UH, REALTIME PRODUCTS, UM, I, I THINK THERE ARE A NUMBER OF, UM, PRODUCTS OUT THERE WHERE RESIDENTIAL CUSTOMERS ARE REWARDED FOR THE SELL BACK OF, UH, THE REVENUE FROM REALTIME PRODUCTS.
IT'S NOT THAT THEY'RE ON, UH, REALTIME RATE WHERE THEY PAY THOSE COSTS, IT'S OKAY.
IT'S BEING REWARDED FOR, FOR SELLING BACK WHAT THEY PURCHASED.
AND SO YOUR CONCERN MORE IS AS WE MOVE AWAY FROM THIS, THOSE, THOSE PROGRAMS MESS MIGHT SEEM LESS ENTICING, UM, OR NOT NECESSARILY THE LESS ENTICING, BUT IT JUST, UM, A PROGRAM THAT ALLOWS PEOPLE TO AVOID A COST INCREASE IS A GOOD THING AND NOT A BAD THING.
I THINK IAN, UM, WAS, WAS GOING DOWN THE SAME PATH I WAS GONNA GO DOWN, BUT I THINK THE MAIN QUESTION, UH, THAT I WAS GONNA ASK ERIC, IS HOW MANY RESIDENTIAL CUSTOMERS ACTUALLY PAY THOSE REAL TIME PRICES? IT SOUNDS LIKE WHAT YOU'RE THINKING, WHAT YOU'RE, UM, WHAT YOU'RE TALKING ABOUT IS, IS MORE ON A DEMAND RESPONSE SELL BACK, UH, ANGLE, NOT NECESSARILY THAT THEY ARE FORCED TO BUY IT AT THOSE PRICES.
IN OTHER WORDS, THE GOAL SHOULD NOT BE THE MORT BEHAVIORAL RESPONSE, IT SHOULD BE TO ENCOURAGE BEHAVIORAL RESPONSE.
YEAH, AND I THINK WE ALL, UH, WE ALL AGREE THAT THE O RDC DOES ENCOURAGE BEHAVIORAL RESPONSES.
UM, IT SOUNDS LIKE MAYBE THERE'S SOME DISAGREEMENT ON, ON HOW MUCH IT SHOULD BE, UM, ENGINEERED TO SPECIFIC BEHAVIORAL RESPONSES, BUT AGREE.
AND THAT'S WHAT I'D LIKE TO DRILL IN ON.
UM, UH, A FIVE OR $10 ADDER DOESN'T HAVE ANY BEHAVIORAL RESPONSE CHANGES.
IT JUST IS A, UH, WAY TO MOVE MONEY FROM BUYERS TO SELLERS.
WELL, I THINK ERCOT HAS DONE SOME ANALYSIS THAT SHOWED THAT THEY HAD, THAT THEY DID SEE SOME BEHAVIORAL RESPONSE WHEN, UH, WHEN THE LAST CHANGES TO THE ODC WERE PUT IN PLACE.
UM, SO IT, YOU KNOW, MAYBE IT'S, WE'RE TALKING ABOUT DIFFERENT BEHAVIORAL RESPONSES.
I'M THINKING MORE IN TERMS OF RESOURCE COMMITMENTS AND, AND YOU'RE PROBABLY THINKING MORE IN TERMS OF, UH, YOU KNOW, DEMAND RESPONSE.
AND SO MAYBE WE'RE, WE'RE TALKING APPLES AND ORANGES, BUT, UM,
[00:55:03]
I THINK I PROBABLY JUST LEAVE IT THERE.UH, SO I THINK THIS IS THE, UH, UH, THING I'M HAVING A PROBLEM WITH ON THE RESIDENTIAL SIDE, AN INCREASE THAT AVERAGE PRICE WILL STILL, UH, PAY OUT A BENEFIT TO REPS OR THIRD PARTIES THAT WANT TO DO DEMAND RESPONSE, WHERE THIS, SO, SO I, I THINK THAT'S A WASH.
I THINK WHERE YOU GET THE BIG BENEFIT ON THIS SIDE THAT ERIC'S POINTING OUT IS FOR DATA CENTERS AND LARGE INTERRUPT THE LOAD THAT DON'T WANT TO INTERRUPT WITH ANY FREQUENCY.
SO A THERMOSTAT PROGRAM'S GONNA WORK NO MATTER WHAT.
SO THIS IS GOING DOWN, THIS PATH IS, UM, VERY TARGETED AND FOCUSED ON BATTERIES, INTERRUPTABLE LOAD, AND UH, UH, DATA CENTERS AND THINGS LIKE THAT.
KENAN, HOW DO YOU THINK RESIDENTIAL DEMAND RESPONSE PROGRAMS WORK? THEY, THEY, SO I'VE ALREADY BOUGHT, BOUGHT THE LOAD, RIGHT? MM-HMM.
AND THEN THERE IS, UH, UH, PRICE THAT YOU COMPUTE ON ABOUT AVERAGE, UM, THAT YOU, UH, GIVE A, UH, PREMIUM TO THE CONSUMER TO INTERRUPT OR LET YOU CHANGE THERMOSTAT SETTINGS, UHHUH
WELL, HOW, HOW DO YOU THINK IT WORKS? MORE IMPORTANTLY, BECAUSE THERE SEEMS TO BE A DISCONNECT.
IT DOES NOT WORK LIKE DATA CENTERS OR INTERRUPT LARGE INTERRUPTIBLE LOAD.
SO THE TWO WAYS THAT IT CAN DIRECTLY BENEFIT REVENUE CONSUMERS ARE BY HAVING A LOWER FIXED PRICE PRODUCT COST BECAUSE YOU'RE WILLING TO BE INTERRUPTED OR TWO, UM, BEING ABLE TO RECEIVE SOME EX EXTRA PAYMENT BECAUSE YOUR RETAILER WAS ABLE TO SELL BACK THE POWER THAT YOU DID NOT CONSUME THAT THEY PURCHASED FOR YOU.
AND, UM, BOTH OF THOSE FIT VERY WELL WITHIN THE RESIDENTIAL RATE STRUCTURE, AND IT'S A GROWING PORTION OF THE MARKET.
UH, AND TO THE EXTENT THAT, UM, THIS WERE TO OCCUR MORE FREQUENTLY, UM, YOU KNOW, AS IT'S INDICATED HERE OR IT KIND OF CONDITIONS, THEY WOULD BE ENCOURAGED.
UM, A A, A KEY AREA, UM, THAT, UH, WE, WE NEED IN ORDER TO HAVE RESOURCE ADEQUACY IS FOR PEOPLE TO BE ABLE TO VOLUNTARILY CURTAIL THEIR, THEIR ENERGY, UH, WITH WHEN THEY WANT TO, RATHER THAN BEING FORCED TO DO IT WHEN WE GET TO ROLLING OUTAGES.
SO, UM, THIS DEFINITELY IS SOMETHING THAT WILL A, ALLOW PEOPLE TO RESPOND TO ITS PRICE AND, UM, IT'S NO DIFFERENT FOR A RESIDENTIAL CONSUMER THAN IT IS KIND OF CONSUMER.
IT'S JUST BASED ON THE PRICE YOU WILL INTER CURTAIL AT.
SO LOOK, LOOK AT THE AREA UNDER THE CURVE.
IT'S ACTUALLY, SO YOUR POINT ACTUALLY IS CONTRARY TO WHAT YOU, WHAT YOU'RE ADVOCATING FOR.
UM, WELL PROBABLY I DON'T HEAR ANYTHING FROM ERIC COMING BACK ON THAT, BUT I, I THINK LET'S, LET'S SEE IF WE CAN KEEP MOVING THIS ALONG HERE PRETTY SHORTLY.
UM, I, I DON'T KNOW THAT WE'RE GONNA COME TO A RESOLUTION ON THIS PARTICULAR POINT HERE AT THIS POINT.
AND ERIC, AS ALWAYS, APPRECIATE YOUR, YOUR THOUGHTS AND COMMENTS, BUT SOME, SOME OF YOUR COMMENTS WERE, UM, WERE JUST CONFUSING ME A LITTLE BIT.
I WANTED TO MAKE SURE I WAS UNDERSTANDING THE DATA PROPERLY.
AS I UNDERSTAND IT ON TAC OPTION TWO, UH, IT DOES IMPACT MORE HOURS, UH, AND THUS IT DOES IMPACT THEM TO A LOWER EXTENT IN A DOLLARS PER MEGAWATT HOUR.
UM, AND THE ERCOT PREFERRED OPTION IMPACTS FEWER HOURS AND IMPACTS THEM TO A GREATER EXTENT IN A DOLLARS PER MEGAWATT HOUR.
AND, UM, I I THOUGHT YOU WERE ARGUING THE OPPOSITE.
UM, IS IT, AS I SEE IT, THIS OPTION KIND OF INCREASES THE PRICE BY A LITTLE BIT IN, IN THE OPTION TWO IN MANY, MANY HOURS, WHICH DOES SEEM A LITTLE BIT COUNTERINTUITIVE TO, TO SOMEONE RESPONDING IN A DAN DEMAND RESPONSE MANNER,
[01:00:01]
WHICH, WHICH THEY WOULD, I THINK PREFER TO RESPOND TO FEWER HOURS, UH, FOR, FOR INTERRUPTION.SO I WAS, I WAS TRYING TO UNDERSTAND WHERE YOU WERE COMING AT YEAH.
UM, SO, UM, YOU'RE RIGHT, AND THE HOURS WHERE THIS ADDER HAS ONLY A SMALL INCREASE THAT HAS THE SAME EFFECT THAT I WAS, UH, DISCOUNTING ON THE ER CAP PREFERR OPTION, UM, BUT IT'S IN THE HOURS THAT, UM, HAVE HIGHER ADDERS, UM, THAT ALLOW THIS TO HAPPEN.
SO WHAT YOU'RE LOOKING AT IS THE AVERAGE INCREASE, BUT THERE ARE SOME NUMBER OF INTERVALS THAT INCREASE THE PRICE OVERALL.
AND YOU KNOW, AS I SAID IN OUR LAST MEETING, WE'D BE HAPPY TO HAVE A MINIMUM ADDER.
UM, SO IF YOU'RE, IF YOU'RE CUTTING OFF SOME OF THE TAIL, SO WE AVOID, YOU KNOW, THE, THE 25 CENT ADDERS AND THE 50 CENT ADDERS, UM, AND, AND THEN ADJUST OVER OFF FROM THERE, I, I THINK WE'D BE HAPPY TO SEE THAT.
UM, TH THIS IS SOMETHING THAT ALLOWS AT LEAST SOME OF THE PRICES TO BE SOMETHING THAT CAN BE RESPONDED TO.
UM, BUT WE'RE, WE'RE HAPPY TO CUT OFF, UM, A SIGNIFICANT PORTION OF THE TAIL THAT'S INCREASED HERE AS WELL.
JAY, THAT ANSWER YOUR QUESTION? YES, IT DOES.
I THINK, I THINK JUST THE DATA PRESENTED PROBABLY SINCE IT'S AVERAGE, IT DOESN'T SHOW, YOU KNOW, LIKE THE TOP 10 HOURS, HOW MUCH IS THE INCREASE IN THOSE, AND MAYBE THAT'S, UM, MAYBE THAT'S THE CHALLENGE WITH WHAT'S PRESENTED, BUT YES, THANK YOU VERY MUCH.
I THINK IT'S AN AVERAGE ISSUE, AND I DON'T ALSO JUST GO BACK TO THE QU THE ANSWER TO SEAN'S QUESTION THAT SHOWED THAT, YOU KNOW, UM, DAVE BELIEVED THAT MOST OF THE LOWER NUMBERS WERE BELOW THE FLOOR THAT THEY, THEY SUGGESTED, AND, AND THOSE WERE ONES WE'D BE, UM, HAPPY TO CUT OFF.
UM, YOU GOT A QUESTION FROM ANDY IN THE QUEUE? YES, THANKS CLIFF.
UM, I WONDER IF, I WANTED TO SEE IF ERCOT HAD AN OPINION ON THE DIFFERENT OPTIONS RELATIVE TO ERCOT PROPOSAL ON ITS EFFECTIVENESS TO REDUCE RUCK, WHETHER Y'ALL SAW A DIFFERENCE BETWEEN THE OPTIONS, AND I CAN START, LEWIS CAN JUMP IN ON THAT.
UH, I WOULD SAY THAT, YOU KNOW, SPECIFICALLY TALKING TO SORT OF THE POINT THAT SEAN WAS MAKING AND THEN IAN ASKED AS WELL, UH, OR THE QUESTION I SAY THAT JOHN'S
BUT THAT WOULD DEFINITELY BE TRUE FROM OUR POINT OF VIEW IN TERMS OF THE COMPARISON OF, OF OUR PREFERRED SOLUTION AND THE TECH OPTION TWO ON THE SLIDE RIGHT NOW.
AND AGAIN, THAT HAS TO DO WITH SPECIFICALLY THE, IN THAT AREAS WHERE WE'RE SEEING THAT ADDITIONAL NEED FOR COMMITMENT THAT'S DRIVING THE R WE'RE NOT REALLY SEEING ANY CHANGES TO THE PRICES THAT WOULD BE EXPECTED TO DRIVE ANY CHANGE OF BEHAVIOR IN THAT AREA OF RESERVE LEVELS.
I CAN ADD, UH, FURTHER DATA POINT.
IF YOU THINK ABOUT THE CONVERSATION ERIC AND I ARE HAVING, UH, OR, OR THE DEBATE, UM, WE CAN'T RUCK LOAD AND WE AREN'T REALLY EFFECTIVELY RUCKING BATTERIES RIGHT NOW.
SO IF YOU HAVE A PARADIGM THAT ADDRESS LETS THERE BE A LOT MORE RESPONSE IN THAT AREA, YOU'RE GONNA HAVE LESS OF A FIX FOR RUCK.
UH, GOT A COMMENT FROM RASHMI.
UH, I JUST WANTED TO CLARIFY ONE THING THAT DAVE, UH, YOU SAID.
UH, SO BETWEEN, UM, OUR COURT, UH, OPTION AND OPTION ONE, I SEE, UH, THE OPTION ONE STILL KEEPS AT $10, SO IT CREATES THAT INCENTIVE FOR ROCKING, BUT THE DIFFERENCE IS, UH, THE VARIATION BETWEEN DIFFERENT YEARS BECAUSE OF THE REVENUE ADDED AT THE END.
IS THAT CORRECT? SO, UH, IF YOU LOOK AT THE INCREASE IN WALL, THE AVERAGE ADDER AT 6,500 IS, UH, WILL COME TO ZERO.
SO I AGREE ON THOSE THAT, UM, THE R ROCKING ISSUE WILL NOT BE SOLVED IN THE WALL, BUT IT WILL BE SOLVED IN THE OPTION
[01:05:01]
ONE, RIGHT? BECAUSE, BECAUSE THE $10 LAW IS STILL KEPT, WELL, I, I, I THINK THE $10 FLOOR HELPED.NOW, I WILL SAY SOME OF THE FEE, THAT FEE THAT WE GOT WAS ONE IS, IS $10 NECESSARILY TO DRIVE SELF-COMMITMENT, PARTICULARLY IF THERE'S SOME UNCERTAINTY AROUND THE, THE 10.
AND SO THAT'S WHY WE HAD GONE WITH THAT MULTI-TIER.
UM, SO, YOU KNOW, I THINK, UM, THIS WAS A POINT THAT NED HAD RAISED DURING THE MEETING.
UM, UH, I CAN'T REMEMBER NOW IF IT WAS THE MARCH 3RD MEETING OR THE MARCH 15TH MEETING, BUT IT TALKED ABOUT, YOU KNOW, AS FOLKS ARE LOOKING TO MAKE SELF-COMMITMENT DECISIONS, THERE IS SOME QUESTION AS TO WHETHER OR NOT THE, THERE'S JUST UNCERTAINTY IN TERMS OF WHETHER OR NOT WE'LL, WE'LL STILL BE IN THE RANGE AND WHICH THE $10 FLOOR APPLIES.
UH, AND SO BECAUSE OF SOME OF THAT UNCERTAINTY, THERE WAS BENEFIT THAT WE SAW IN HAVING THE MULTI-TIER APPROACH, INCLUDING THE $20 FLOOR AT THE, THE LOW RESERVE LEVEL.
SO I STILL THINK OUR PREFERRED OPTION WOULD BE MORE EFFECTIVE IN ADDRESSING THE NEED FOR RS.
UM, BUT, BUT CERTAINLY THERE'S, THERE IS BENEFIT THERE UNDER TECH OPTION ONE AND, AND, AND MUCH MORE THAN I THINK WE SEE WITH THE, UM, WITH THE VAULT CHANGE.
I MEAN, EFFECTIVELY THE WAY TO THINK ABOUT THE VAULT CHANGE IS BECAUSE WE'RE, BECAUSE WE'RE SIMPLY INCREASING THE VOL AMOUNT, IT'S ESSENTIALLY A 1.1 MULTIPLIER ON ALL HISTORICALLY OBSERVED PRICE ADDERS IN THESE TWO YEARS.
SO WHATEVER THE ADDER WAS MULTIPLIED BY ABOUT 1.1, AND THAT'S THE NEW ADDER YOU WOULD GET.
UH, AND SO TO THE DEGREE, YOU KNOW, WE'RE TALKING ABOUT RESERVE LEVELS IN THE 6,000 TO 7,000 MEGA OR ONLINE RESERVE RANGE WHEN THE ADDERS WERE, YOU KNOW, RELATIVELY SMALL, A 1.1 MULTIPLIER IS LIKELY NOT DRIVING ANY BEHAVIORAL CHANGE IN THAT RANGE.
THANKS RASHMI, SEAN? YEAH, UM, I GUESS WE'RE, YOU KNOW, SORT OF TWEAKING THE RDC SO MUCH.
I'M WONDERING IF IT MAKES SENSE TO REALLY JUST TRY AND ABANDON ALL THIS AND JUST GO WITH A PIECE, PIECEWISE LINEAR OR RDC THAT CUTS OFF THE TAIL, YOU KNOW, BEYOND 7,000 AND SOMETHING.
USE THOSE DOLLARS TO HAVE A HIGHER BALL OF LIKE 9,000 AND JUST CREATE A CURVE THAT'S MORE REFLECTIVE OF, UM, THREE SERVICE VALUES.
UM, YOU KNOW, YOU MIGHT USE A LOT OF THAT MONEY TO MAKE THAT CURVE, UM, ON THOSE INTERVALS THAT REALLY DON'T IMPACT BEHAVIOR ANY.
SO JUST A THOUGHT MAYBE LONGER TERM, WE CAN THINK ABOUT THAT.
DAVE, LOOKS LIKE THE QUEUE IS EMPTY, SO YOU CAN KEEP ON ROLLING.
I KNOW WE TALKED ABOUT A LITTLE BIT THIS ONE ALREADY.
UH, SO THE, THIS, THIS QUESTION WAS ASKED EARLIER, BUT THE, WE'RE SHARING, THIS IS DATA WE HAD SHARED BEFORE, BUT WE'RE SHARING IT IN A SLIGHTLY DIFFERENT FORMAT HERE.
WHAT WE'RE LOOKING AT IS WHAT IS THE MIX OF RESOURCE TYPES FOR THE TWO YEARS, BOTH LOOKING AT THE YEARS IN TOTAL, JUST SIMPLY ACROSS ALL INTERVALS, AND THEN UNDER THE VARIOUS CASES THAT WE ANALYZED, WHAT IS THE FUEL MIX DURING JUST THE ADJUSTED INTERVALS? SO THE, THE AMOUNT OF INTERVALS AT THE SPECIFIC INTERVALS BEING ADJUSTED ARE OF COURSE DIFFERENT BETWEEN THE CASES.
AND SO YOU'LL SEE A SLIGHT DIFFERENCE IN, UH, WHAT THE FUEL MIX WAS DURING THE ADJUSTED INTERVALS ACROSS THESE THREE CASES.
AND THE REASON WE'RE LOOKING AT FUEL MIX IS, UH, THIS WAS INTENDED TO BE SORT OF A, A, A VERY HIGH LEVEL APPROXIMATION OF WHERE WE WOULD SEE THE, THE REVENUES GO, THE, THE, THE INCREMENTAL REVENUES GO, UH, ACROSS THE DIFFERENT RESOURCE TYPES.
AND, AND I GUESS I'LL JUST KIND OF CALL OUT ON THE NEXT SLIDE.
WE'RE GONNA LOOK AT THIS IN A SLIGHTLY DIFFERENT WAY.
UM, INSTEAD OF LOOKING AT THE DISTRIBUTION BY RESOURCE TYPE, WE'RE GONNA LOOK AT BY, UH, RESOURCE AGE.
UM, I THINK THE, THE ONE THING THAT WE HAD, UH, UH, TALKED ABOUT IN OUR PREVIOUS PRESENTATION WAS SPECIFICALLY COMPARING WHAT THE FUEL MIX LOOKED LIKE WHEN YOU LOOK AT ALL INTERVALS RELATIVE TO WHAT YOU SAW UNDER THE ERCOT PREFERRED OPTION.
AND SOME OF THE, THE, I GUESS THE BIGGEST DELTAS YOU SEE ARE AROUND, I GUESS, TWO SPECIFIC, UH, RESOURCE TYPES.
I WOULD SAY THE, THE ONE WAS THE, THE CHANGE IN WHAT YOU SEE IN TERMS OF THE PERCENT OF FUEL MIXED FROM NATURAL GAS.
SO IF YOU LOOK OVERALL, AND I'M GONNA FOCUS ON 2022, JUST TO MAYBE BE ABLE TO EXPLAIN A LITTLE BIT MORE.
UH, SO FOR WHAT WE SAW FOR 2022, THE,
[01:10:01]
THE FUEL MIX OR THE PERCENT OF FUEL FROM NATURAL GAS ACROSS ALL INTERVALS WAS AROUND 43%.IF YOU LOOK AT JUST THE ADJUSTED INTERVALS UNDER THE ERCOT PREFERRED OPTION, THAT'S AROUND 53%.
YOU SEE SOMETHING VERY SIMILAR FOR, UH, THE TACK OPTION ONE.
UH, AND THEN IF YOU LOOK AT THE, UH, TACK OPTION TWO, YOU SEE DO SEE AN INCREASE, BUT IT'S, IT IS, IT IS LOWER AND, AND THE, THE PERCENT OF FUEL, UH, OR PERCENT OF ENERGY FROM, UH, NATURAL GAS IS 48% IN THOSE ADJUSTED INTERVALS.
UH, THE OTHER RESOURCE TYPE THAT YOU PROBABLY SEE THE, THE LARGEST CHANGE FOR IS, UH, WITH WIND.
AND THIS IS SOMETHING WE HAD SPOKEN ABOUT TO AT THE, AT THE LAST, UH, TIME WE HAD PRESENTED THIS.
UH, IF YOU LOOK ACROSS ALL INTERVALS, THAT PERCENT IS AROUND 25%.
UH, IF YOU LOOK AT THAT FOR THE, THE DIFFERENT PERF THE DIFFERENT OPTIONS FOR, UH, THE ERCOT PREFERRED OPTION, THAT PERCENTAGE IS AROUND 14%.
UH, YOU SEE SOMETHING SIMILAR FOR TECH OPTION ONE AROUND 14%, AND THEN FORT OPTION TWO, UH, THAT VALUE IS, UH, SOMEWHERE BETWEEN WHAT YOU SEE FOR ALL INTERVALS AND, AND THOSE OTHER FIRST TWO CASES.
UH, AND IN THIS CASE YOU SEE 19% FOR 2022.
SO THOSE ARE KIND OF THE, THE REAL I, I THINK, RESOURCE TYPES WITH THE BIGGEST DIFFERENCES.
AND AGAIN, THE IDEA HERE IS, UH, CAN WE USE THE FUEL MIX FOR ADJUSTED INTERVALS AS A WAY TO APPROXIMATE HOW THE INCREMENTAL REVENUES WOULD, WOULD FLOW BY RESOURCE TYPE.
UH, GOING TO THE NEXT SLIDE, WE LOOKED AT THE INFORMATION FAIRLY, OH, SORRY.
SORRY, I JUST SAW YOU JUMP IN THE QUEUE.
DO YOU HAVE A QUESTION ON SLIDE SEVEN? YEAH, I WAS WONDERING WHY, UH, BACK OPTION ONE DIDN'T RESULT IN MORE MONEY GOING TO THE NATIONAL GAS AND COAL AND NUCLEAR RATHER THAN THE OTHERS.
SO THE BIG DIFFERENCE IS IN THAT, AND I I WOULD SAY THIS IS OUR, AND I HAD A BULLET POINT ON THERE.
THE APPROXIMATION THAT WE'RE USING, I THINK WORKS BEST FOR THE ERCO PREFERRED OPTION.
AND THE REASON I SAY THAT IS THE, THE CHANGE IN PRICE IS A LITTLE BIT MORE CONSISTENT FOR ALL THE ADJUSTED INTERVALS.
SO THAT'S NOT NECESSARILY DOING SORT OF A PRICE WEIGHTED, UH, VERSION OF VIEW OF HOW THOSE CALCULATIONS ARE DONE.
UM, SO THIS IS REALLY JUST LOOKING AT THE FUEL VIX, NOT NECESSARILY A TRUE CALCULATION OF THE FLOW OF REVENUES.
AND, AND I GUESS JUST THE LAST KEY PART OR TWO IS, AS WE TALKED ABOUT IN ON SLIDE, I THINK IT WAS FIVE, UM, THE NUMBER OF INTERVALS THAT WERE EFFECT, I THINK YOUR POINT IS, UM, FOR THE INTERVALS THAT ARE ADJUSTED BASED ON THAT FLOOR AT THE 4,000 MEGAWATT LEVEL, THE FUEL MIX IS PROBABLY EVEN MORE SO TILTED TOWARDS, UH, PROBABLY NATURAL GAS IN, IN SOME OF THE OTHER DISPATCHABLE RESOURCES AS OPPOSED TO, UH, WIND AND SOLAR.
IT'S JUST A SM IT'S JUST A SMALL SET OF THE OVERALL INTERVALS BEING IMPACTED.
SO WE'RE TALKING ABOUT IN, IN THIS CASE, YOU KNOW, EIGHT TO 9,000 INTERVALS BEING IMPACTED, AND LESS THAN A HUNDRED OF THOSE BEING THE CASE WHERE THE RESERVES ARE BELOW 4,000.
SO THEY'RE NOT PLAYING, YOU'RE, YOU'RE RIGHT THAT THE FIELD MIX WOULD EVEN BE DIFFERENT, UH, FURTHERMORE, UH, AT THOSE LOWER RESERVE LEVELS, BUT THEY'RE A VERY SMALL FRACTION OF THE OVERALL INTERVALS.
BUT, UH, YOU KNOW, WHEN YOU LOOK AT THE DOLLARS, IT WAS LIKE 200 MILLION WERE IN THOSE INTERVALS FOR 2022 OVER, UM, YOU KNOW, COMPARED TO THE TOTAL 500.
SO THAT'S WHY I WAS THINKING THE PERCENTAGE WOULD BE, AT LEAST FOR 2022 WOULD BE HIGHER.
AND THIS IS, THIS IS JUST THE FUEL MIX.
THIS IS, THIS IS, SO THIS IS NOT A TRUE CALCULATION OF LOOKING AT THE, THE CHANGE IN REVENUE WE ARE USING.
I I THINK IT'S A, THIS, THE FUEL MIX IS A GOOD APPROXIMATION FOR THE ERCOT PREFERRED SOLUTION.
I DID WANNA SORT OF SHARE EQUIVALENT VALUES, BUT I, I THINK THAT USING THIS, UM, AS A, AS A PROXY FOR THE DISTRIBUTION OF ADDITIONAL REVENUE IS NOT, DOES NOT WORK PARTICULARLY WELL FOR, UH, TAC OPTION ONE.
SO, UM, DO YOU HAVE ANOTHER WAY OF LOOKING AT THAT OR NOT THAT I CAN GET DONE FOR TODAY, RIGHT,
[01:15:04]
KAAN, YOU MAY BE MUTED.UM, THIS HAS BEEN SOMETHING AS WE'VE BEEN PUTTING IT OUT THAT I THINK HAS CAUSED CONFUSION, BUT REALLY THE FOCUSES ON THE RESOURCES THAT ARE ONLINE AT THAT TIME, UH, IN THOSE INTERVALS, AND THEN HOW THE REVENUE FLOWS.
SO I, I THINK DAVE KIND OF, THEY'VE MADE THAT POINT, BUT, UM, THE, IT, IT REALLY DOES CHANGE AS YOU COME CLOSER AND CLOSER TO THE, TO THE EDGE.
DAVE, DID YOU WANNA ADD ANYTHING TO THAT SINCE YOU AND I HAVE BEEN TALKING ABOUT THAT QUITE A BIT? NO, I THINK I, I GUESS I, HOPEFULLY I COVERED IT WITH MY PREVIOUS STATEMENT, BUT YEAH, I, I DO UNDERSTAND.
I, IT REALLY, UM, IT, IT IS SOMEWHAT OF A, OF A LIMITED APPROXIMATION, BUT THE, THE FOCUS HERE, AND IT, AND IT WORKED WELL WHEN WE WERE LOOKING AT SPECIFICALLY OUR PREFERRED OPTION IS A WAY TO APPROXIMATE HOW THOSE, THOSE DOLLARS WOULD BE DISTRIBUTED BY, BY RESOURCE TYPE.
UH, UM, BUT IT DOESN'T ACCOUNT FOR, UM, PARTICULARLY AS YOU THINK ABOUT THE LOWER FLOOR, I'M SORRY, THE, THE HIGHER FLOWS AT LOWER RESERVE LEVELS, UM, BECAUSE OF SOME SORT OF THE AVERAGING, IT'S NOT GONNA NECESSARILY CAPTURE THE DISTRIBUTION OF REVENUES AS WELL FOR, FOR OPTIONS LIKE THAT.
BOB WHITMEYER? YEAH, I THINK, I THINK THIS IS REALLY A KEY POINT.
I MEAN, I CERTAINLY HAVE THE IMPRESSION, THE INTENT HERE IS TO TRY TO DRIVE MORE REVENUES TOWARDS DISPATCHABLE GENERATION, AND I CERTAINLY EXPECTED, YOU KNOW, THE $4,000 NUMBER TO MOVE MORE TO, TO TWO DISPATCHABLE GENERATION.
UM, I THINK THAT'S REALLY KEY FOR THE BOARD TO UNDERSTAND, BUT I DON'T KNOW HOW ELSE WE GET THERE, SO THANK YOU.
UH, KAAN, SORRY, I'M, UH, I FEEL LIKE I'M SPEAKING A LOT, BUT, UM, I, I JUST, UH, I MEAN, UH, I THINK DISPATCHABLE GENERATION OF COURSE IS EXTREMELY IMPORTANT, BUT THE IDEA WAS TO DRIVE REVENUES TO RESOURCES THAT WERE AVAILABLE AND ONLINE DURING THESE SCARCE INTERVALS WITHOUT A PARTICULAR PREFERENCE.
UM, IT, IT, IT PLAYS OUT LIKE THIS, AND I THINK THAT IS AN IMPORTANT OBSERVATION THAT BOB MADE.
BUT I, I JUST WANT TO EMPHASIZE THAT ERCOT DIDN'T TRY AND EXCLUDE OR INCLUDE, UH, ANYTHING, JUST TRIED TO BUILD SOMETHING THAT REWARDED RESOURCES THAT WERE AVAILABLE WHEN WE NEEDED THEM.
HEY, KAAN, AND JUST TO BE CLEAR, THAT IS ABSOLUTELY THE RIGHT TECHNOLOGY NEUTRAL APPROACH.
COMPLETELY AGREE WITH, UM, I JUST WOULD'VE EXPECTED THAT AS WE GOT TO THOSE LOWER RESERVE HOURS, YOU KNOW, WE WOULD'VE SEEN MORE GO TO, TO COAL NATURAL GAS, THAT'S ALL.
BUT I, I COMPLETELY AND TOTALLY AGREE, WE SHOULD NOT BE DESIGNING THE SYSTEM TO BE, YOU KNOW, TECHNOLOGY FAVORABLE.
THAT'S JUST WHAT I WOULD'VE EXPECTED TO HAPPEN.
SO THANK YOU FOR THAT CLARIFICATION.
YEAH, AND, AND, AND I, I UNDERSTOOD YOUR POINT.
IT'S JUST, UM, LIKE I SAID, THIS ANALYSIS HAS REALLY SPUN SOME PEOPLE UP, SO I FEEL OBLIGATED TO, TO, YOU KNOW, MAYBE EMPHASIZE CERTAIN THINGS WHEN I MIGHT NOT IN OTHER, OTHER CIRCUMSTANCES.
UH, CUES EMPTY AGAIN, SO YOU CAN KEEP ROLLING, DAVE.
ALL RIGHT, WE CAN MOVE TO SLIDE EIGHT.
SO THIS ANALYSIS, UH, CAME OUT OF SOME, SOME, UH, SIDE QUESTIONS THAT CAME FOLLOWING THE, SOME OF OUR PREVIOUS PRESENTATIONS.
SO THIS IS THE, THE SAME IDEA WHERE WE'RE LOOKING AT THE AVERAGE FUEL MIX, BUT INSTEAD OF LOOKING AT IT BASED ON FUEL TYPE, WE'RE LOOKING AT IT BASED ON RESOURCE AGE.
AND I GUESS CONSISTENT WITH SOME OF THE ANALYSIS WE'VE SHARED IN OTHER AREAS, WE, WE'VE BROKEN OUT THE AGE OF RESOURCES INTO, TO CATEGORIES OF, OF 10 YEAR SWABS.
SO YOU'LL SEE THE, THE, WHAT IS IT, THE, UM, SEVEN DIFFERENT CATEGORIES WE HAVE, UH, JUST BASED ON THE SORT OF ZERO TO 10, 10 TO 20, AND SO ON AND SO FORTH.
UH, LIKE WE SHOWED IN THE PREVIOUS SLIDE, WHAT YOU SEE IN THE FIRST TWO COLUMNS OF PERCENTAGES ARE JUST WHAT WAS THE, THE, THE MIX
[01:20:01]
BASED ON ALL INTERVALS WITHIN THE YEARS THAT WE STUDIED.AND THEN FOR THE THREE DIFFERENT CASES THAT WE ANALYZED, WHAT WAS THE, THE FUEL MIX BASED ON RESOURCE AGE ONLY FOR THE ADJUSTED INTERVALS IN GENERAL.
I, I WOULD NOT SAY THAT WE SAW SOMETHING QUITE AS LARGE IN TERMS OF, UH, UH, CHANGES, UH, FROM, I GUESS ONE CATEGORY TO THE OTHER.
I THINK A GENERAL TREND THAT YOU SAW SPECIFICALLY FOR THE ERCOT PREFERRED OPTION IN AND TECH OPTION ONE IS THAT THE, FOR JUST THE ADJUSTED INTERVALS, YOU TEND TO SEE SLIGHTLY LOWER NUMBERS FOR THE RESOURCES THAT ARE, ARE ZERO TO 10, 10 TO 20 KIND OF IN, IN THAT RANGE.
AND YOU SEE SLIGHTLY HIGHER VALUES FOR SOME OF THE, UH, RESOURCES THAT ARE, ARE SLIGHTLY OLDER.
SO JUST SORT OF A SHIFT OF THE BLEND IN THAT DIRECTION.
UM, I THINK THAT YOU SORT OF OBSERVED CONSISTENT RESULTS BETWEEN THE ERCO PREFERRED OPTION AND THE OPTION ONE, UH, LIKE BEFORE WITH THE PREVIOUS SLIDE, BECAUSE OF THE, JUST SO MANY MORE INTERVALS BEING ADJUSTED, IF YOU LOOK ATTAC OPTION TWO, THOSE PERCENTAGES ARE MORE IN ALIGNMENT WITH WHAT WE SEE ACROSS THE HOLD OF THE YEARS.
SO THAT WAS AT LEAST JUST THE, THE GENERAL OBSERVATIONS WE HAD, UH, BREAKING OUT THE DATA IN THIS PARTICULAR WAY.
I JUST WANTED TO POINT OUT THAT IF ONE OF THE GOALS HERE IS TO ATTRACT, UM, OLDER GENERATORS TO STAY ONLINE AND NOT RETIRE, UM, IT SEEMS THAT THIS PARTICULAR APPROACH, UM, DOESN'T DO IT FOR ANY OF THESE OPTIONS REALLY IN ANY SIGNIFICANT WAY.
UM, AND I DON'T KNOW THAT THIS COULD BE MODIFIED IN A WAY TO, TO DO THAT.
UM, BUT I THINK IT JUST, IT'S NOTABLE THAT, UM, YOU KNOW, ALL OF THESE ORDC OPTIONS HAVE A RELATIVELY SIMILAR RE RESULT IN THAT CASE.
OBVIOUSLY SOME HAVE BIGGER NUMBERS THAN OTHERS.
UM, BUT I, I, I THINK THAT'S IMPORTANT FOR POLICYMAKERS TO UNDERSTAND, UM, TO THE EXTENT YOU'RE LOOKING AT TRYING TO ATTRACT NEW GENERATION, UM, YOU KNOW, OPTION TWO IS SLIGHTLY HIGHER, BUT ALSO STILL WITHIN THE SAME RANGE, A AS THE OTHER OPTIONS.
I GUESS ONE THING I, I WOULD NOTE ON THAT, I DO THINK THERE'S A, A BIT OF A LINKAGE TOO BETWEEN PROBABLY AGE AND TYPE OF RESOURCES.
WELL, SO AS WE, AS YOU THINK ABOUT THAT, WE WOULD PROBABLY NEED TO, AND MAYBE THERE'S WAYS TO, TO SLICE AND DICE THIS A LITTLE BIT MORE, BUT, UH, THAT WOULD PROBABLY BE SOMETHING WE'D ALSO KIND OF WANT TO, TO THINK ABOUT IN TERMS OF UNDERSTANDING THESE OUTCOMES A LITTLE BIT BETTER.
ALL RIGHT, IAN, THANKS, CLIFF.
UM, WE AS A RESOURCE OWNER DON'T MAKE DECISIONS BASED UPON BACK CASTED MODELS OF WHAT WOULD'VE HAPPENED.
UH, WE AS A RESOURCE OWNER AND A DEVELOPER MAKE DECISIONS BASED UPON THE FORWARD MARKETS.
AND SO, UM, R D C CHANGES WILL BE INTERPRETED BY THE MARKET INTO THE FORWARD CURVES, AND THAT'S WHAT WE AS A RESOURCE OWNER WOULD USE.
BOB, HEY, DAVE, ARE THESE PERCENTAGES ON THIS CHART, OR WHAT ARE THE, WHAT ARE THE VALUES IN THE TABLE? YEAH, SO THAT YOU CAN SEE THAT IN THE TOP, LOOK, THIS IS THE ESSENTIALLY PERCENT OF ENERGY FOR EITHER THE HOLD OF THE YEAR OR FOR JUST THE ADJUSTER INTERVALS, BUT IT'S THE PERCENT OF ENERGY BY RESOURCE AGE CATEGORY.
SO BACK TO ERIC'S PREVIOUS POINT, OUR, OUR 60 PLUS YEAR OLD UNITS, WE DON'T HAVE A WHOLE LOT OF THOSE.
IS IT A FAIR APPLES TO APPLES COMPARISON WHEN WE'RE TALKING ABOUT A HANDFUL OF UNITS VERSUS A LOT OF UNITS THAT ARE LIKE IN THE 20 TO 30 YEAR OLD RANGE? OR IS THERE A CORRELATION BETWEEN THIS 0.46 ON THE BOTTOM AND HOW MUCH REVENUE PER MEGAWATT THEY GET, I GUESS IS KIND OF THE QUESTION? UH, I, I DO THINK THERE'S A, A BIT OF A CORRELATION, I GUESS YOU WOULD SAY.
UM, YOU KNOW, WHEN WOULD THOSE, THOSE RESOURCES BE RUNNING? SO MAYBE THE, THE APP BETTER APPLES, THE APPLES COMPARISON, BOB, WOULD BE TO LOOK AT THE, THE CHANGE IN THE PERCENT.
SO FOR EXAMPLE, IT MOVES FROM, UH, 0.28%, AGAIN, A A SMALL PERCENT, AND JUST BASED ON THE NUMBER OF RESOURCES THAT FALL INTO THAT CATEGORY.
BUT A, A 0.28 PER PERCENT INCREASE UP TO 0.46.
SO I GUESS FROM A, FROM A PERCENT CHANGE, THAT'S SOMEWHAT, SOMEWHAT LARGE, RIGHT?
[01:25:01]
UM, BUT THE, YOU KNOW, I THINK THEN THE IDEA IS THESE RESOURCE, THERE'S A LOT OF TIMES THESE RESOURCES DON'T RUN, BUT THEY ARE, I GUESS THEY SEE TO BE A LARGER FRACTION OF THE TOTAL ENERGY MIX IN THE INTERVALS THAT WE'RE WANTING TO ADJUST BECAUSE OF SEEING THE GREATER NEED.UM, I GUESS AS WE MENTIONED THIS, THIS DATA'S NOT LOOKING AT THE, THE, NECESSARILY THE TAX CASES, BUT IT WAS A QUESTION THAT CAME UP JUST REGARDING, UM, UM, TRYING TO TAKE THE PERCENTAGE OF FUEL MIX AND CONVERTING THAT INTO TOTAL DOLLARS, UH, IN TERMS OF HOW THE, THE SORT OF, THE DOLLARS WOULD BE ALLOCATED.
AND SO WHAT WE'RE LOOKING AT HERE IS SPECIFICALLY FOR THE ERCOT PREFERRED OPTION, WHERE WE THINK THE PERCENT OF ENERGY, UH, FUEL MIX IS A GOOD APPROXIMATION FOR HOW THE DOLLARS WOULD BE DISTRIBUTED.
WE TOOK THE PERCENTAGES FROM SLIDE SEVEN AND EIGHT AND APPLIED THE INCREMENTAL REVENUES THAT WE SAW FROM OUR BACKCAST FOR 2020 AND 2022 TO COME UP WITH A, UH, A DOLLAR AMOUNT, UH, FOR EITHER THE RESOURCE TYPE IN THE, THE LEFT TABLE OR THE AGE CATEGORY IN, UH, THE RIGHT TABLE.
AND THIS IS ALL INCREMENTAL REVENUE IN, UH, MILLIONS OF DOLLARS BY DIFFERENT CATEGORIES ACROSS THE TWO YEARS.
SO, UH, AGAIN, NO REAL NECESSARILY NEW INFORMATION, BUT JUST WANTED TO BREAK THAT OUT MORE, UH, EXPLICITLY FOR THE GROUP BASED ON SOME OF THE, THE FEEDBACK WE'VE GOTTEN IN PREVIOUS MEETINGS.
ALRIGHT, CHARLES, UM, SO DAVE, YOU USED THE PERCENTAGE, THE ENERGY PERCENTAGES AND JUST MULTIPLY THAT TIMES THE 500, ROUGHLY 500 MILLION.
YOU DIDN'T ACTUALLY GO INTO THESE CATEGORIES AND SEE HOW MUCH MORE THEY ACTUALLY MADE.
THAT'S WHAT WE'RE USING AS APPROXIMATION.
IS THEIR, THEIR SHARE OF THE FUEL MIX DURING THE ADJUSTED INTERVALS IS THE OTHER WAY.
DOING IT MUCH MORE DIFFICULT OR, UH, YEAH, IT IS, I GUESS THIS IS JUST HOW WE HAD SET IT UP.
IT IS A LITTLE BIT MORE COMPLICATED CUZ WE'RE NOT ALL OF THESE CALCULATIONS WERE AT A SYSTEM-WIDE LEVEL, NOT AT A, AT A RESOURCE LEVEL.
SO WE JUST DIDN'T HAVE TIME TO BREAK IT OUT IN THAT OTHER WAY.
ALTHOUGH I AGREE THAT THAT WOULD BE A MORE, UH, ACCURATE WAY TO TRY AND COME UP WITH THE, THE REVENUE ALLOCATION, RIGHT, ESPECIALLY OPTION ONE.
YOU KNOW, WHEN YOU'RE COMPARING THIS TO OPTION ONE, THAT WOULD REALLY BE HELPFUL IF WE COULD DO IT, UH, BASED ON ACTUAL DOLLARS THAT WENT TO THESE RESOURCE TYPES.
I DON'T KNOW HOW MUCH YEAH, I THINK THAT'S, YEAH, I MEAN, I THINK IT'S TRUE THAT OUR, OUR APPROACH IS REALLY MORE EFFECTIVE FOR OUR PREFERRED OPTION, AND THAT'S SORT OF WHY WE HAD STARTED WITH THAT, UM, BEFORE WE HAD GOTTEN INTO THE OTHER, UH, I GUESS CASES YOU ALL HAD ASKED FOR, UH, A WEEK AND A HALF AGO OR SO.
UM, BUT, BUT YEAH, IT IS, IT IS DEFINITELY, I THINK, LESS ACCURATE FOR THE TWO PACKED REQUESTED CASES.
CAN WE DO THIS, UM, YOU KNOW, NOT TODAY, OF COURSE, BUT, UH, SOMETIMES SO THAT IF WE HAVE COMMENTS TO FILE WITH THE P C SORT OF, UM, DO THAT ANALYSIS OR OPTION THE TECH OPTIONS AND THIS OPTION, UH, DO THAT CALCULATION THAT WAY I CAN TRY AND TAKE THAT BACK.
I, I DON'T KNOW THAT I CAN PROMISE THAT WE CAN GET THAT ANALYSIS TOGETHER.
YEAH, APPRECIATE YOU LOOKING TO THAT.
ALL RIGHT, SO THE NEXT THREE SLIDES ARE ALL, AGAIN, SORT OF SIMILAR.
UH, ONE OF THE OTHER QUESTIONS THAT CAME UP WAS JUST SORT OF, UM, THINKING ABOUT THESE YEARS THAT WE SAW, HOW DID THE INCREMENTAL REVENUES BREAK OUT BY MONTH WITHIN, UH, WITHIN THE TWO YEARS THAT WE STUDIED? SO, UH, FOR THE NEXT THREE SLIDES, THEY'RE ALL JUST LOOKING AT THE DIFFERENT CASES AND WE SPLIT OUT THE INCREMENTAL REVENUE WITH, BETWEEN SORT OF THE, THE AMOUNT OF SPACE WITH THE ENERGY COMPONENT AS WELL AS, UH, SORT OF, UH, THE HEADROOM COMPONENT.
UH, AND SO I, I GUESS FOR, FOR 20, I'M SORRY, FOR THE ERCOT PREFERRED OPTION, YOU'RE LOOKING AT 2020 AND 2022.
YOU SEE SOME DISTINCTION BETWEEN THE MONTHS.
UM, ALTHOUGH, UM, YOU SEE, I THINK AS WE SHOWED IN THE, IN THE ANNUAL TOTALS, YOU SEE, UM, UH, FAIRLY SIMILAR TOTALS ACROSS THESE TWO YEARS AND RELATIVELY, I THINK, CONSISTENT RESULTS A
[01:30:01]
ACROSS THE MONTH, YOU KNOW, THAT WAS NOT NECESSARILY ANY SORT OF INTENDED OUTCOME, BUT JUST THE, THE OBSERVATION THAT WE HAD WITH, UH, THIS SPECIFIC APPROACH.IF YOU GO TO, UH, SLIDE 11, THIS IS LOOKING AT CA OPTION ONE.
I, I GUESS ONE OF THE THINGS THAT YOU WOULD IMMEDIATELY NOTE IS YOU DO SEE JUST MORE DIFFERENCE IN THE TOTALS BETWEEN 2020 AND 2022.
WE OF COURSE, TALKED ABOUT THAT DURING ONE OF THE PREVIOUS, UH, SLIDES.
UH, YOU, AS YOU ALSO START TO SEE JUST A LITTLE MORE DISTINCTION IN INDIVIDUAL MONTHS, PARTICULARLY IF YOU LOOK AT 2022, UM, YOU SEE, UH, FOR EXAMPLE, FEBRUARY AND JULY STAND OUT A LITTLE MORE.
OF COURSE, THOSE WERE THE TWO MONTHS, IF I RECALL, THAT WE DID HAVE RESERVE LEVELS THAT WERE IN THAT 4,000 OR LESS RANGE.
AND SO OF COURSE, UH, AND I THINK, SEAN, YOU HAD MENTIONED THIS, WE DID HAVE INCREASED REVENUES OR, OR FAIRLY SIGNIFICANT LEVEL OF INCREASED REVENUES ASSOCIATED JUST WITH THOSE SMALLER NUMBER OF INTERVALS AT LOWER RESERVE LEVELS.
AND OF COURSE, IF THOSE OCCURRED IN FEBRUARY AND JULY, UH, YOU WOULD SEE MORE OF THE REVENUES FOCUSED ON THOSE TWO PARTICULAR MONTHS.
AND THEN LASTLY, UH, SLIDE 12 IS LOOKING AT THE TECH OPTION TWO.
THIS, THE, THE INCREASE IN BALL.
UM, I GUESS THE, AGAIN, THE FIRST OBSERVATION IS TO SOME DEGREE, 2020 HAS HIGHER OVERALL VALUES AS COMPARED TO 2022.
AGAIN, WHAT WE'VE TALKED ABOUT WITH THAT PREVIOUS TABLE.
UH, AND THEN YOU ALSO JUST GENERALLY DO SEE A LOT MORE VARIATION ACROSS MONTHS WITHIN THE, THE GIVEN YEARS.
UH, IN, IN 2020, UH, YOU SEE A LOT OF, UH, THE FOCUS AND INCREASED REVENUES, UH, IN AUGUST, FOLLOWED BY OCTOBER.
UH, AND THEN FOR 2022, UH, YOU SEE, UH, JULY STANDOUT AGAIN AS YOU DID ON THE PREVIOUS, UH, SLIDE.
AND THEN THEN TO SOME DEGREE FEBRUARY IN MAY, UH, AND THEN FOLLOWED BY AUGUST WITH REALLY ALL THE OTHER MONTHS BEING RELATIVELY LOW, UH, CERTAINLY RELATIVE TO THAT, UH, TO THE OUTCOMES IN JULY.
UH, AND THEN I GUESS JUST THE LAST SLIDE HERE, AND I, I WON'T SPEND TOO MUCH TIME ON IT.
THIS IS JUST, UH, REALLY A RECAP OF, UH, SOME OF THE BENEFITS THAT WE HAVE LAID OUT IN THINKING ABOUT OUR PREFERRED OPTIONS.
SO, UH, AGAIN, CAN THINK KENAN PRESENTED THIS LAST TIME.
UH, AND SO, UH, I GUESS I'LL, I'LL JUST TURN IT OVER TO, UH, ANY MORE QUESTIONS FOLKS MAY HAVE.
AND I SEE RASHMI IN THE QUEUE.
UM, HEY, UH, AM I, YEAH, WE CAN HEAR.
HEY, UH, DAVE, THANK YOU SO MUCH FOR DOING THE ANALYSIS.
UH, IT'S SUCH SHORT NOTICES AND, UH, WE DO SUPPORT RESOLVING ROCK ISSUE THROUGH THE O R D C, SO, UH, GREATLY APPRECIATE, UH, LOOKING INTO THAT ASPECT OF IT.
UH, SO LAST TIME WHEN WE TALKED ABOUT, UM, UH, THE DISCUSSION WAS THAT TEL DATA STUDY, WHICH SHOWED, UH, $10, UH, FOR FOUR HOURS ON AVERAGE WOULD RESOLVE THE, UH, OR WOULD CREATE THE INCENTIVE FOR, UM, COMMITMENT.
AND THERE WAS A QUESTION, UM, ON LIKE HOW LONG THOSE, UH, UH, 6,500 OR 7,000 HOURS, WHERE DID YOU BY ANY CHANCE, HAD A CHANCE TO LOOK AT THAT ONE? I KNOW IT WAS TYPED ON AROUND, SO IF YOU DIDN'T THAT'S FINE.
NO, I'M SORRY, RASHMI, I GUESS WE, WE HAD NOT CAPTURED THAT AS PART OF OUR ADDITIONAL ANALYSIS IN TERMS OF LOOKING AT, UM, I GUESS SORT OF A DURATION CURVE AT RESERVE LEVELS IN THOSE RANGE.
I WILL SAY, UM, MY GENERAL INTUITION ON IT IS THE DURATION OF TIME THAT WE WOULD SPEND AT THE VERY, I GUESS THE, THE MUCH LOWER RESERVE LEVELS, UM, WOULD BE SHORTER.
I WOULD GENERALLY THINK WHEN WE ARE GETTING INTO THE RESERVE LEVELS AROUND SIX, YOU KNOW, 6,500, 7,000 TYPE OF RANGE, THOSE WOULD CERTAINLY BE, UM, MUCH LONGER DURATIONS THAT WE WOULD SPEND AS COMPARED TO THOSE REALLY LOWER RESERVE LEVELS.
BUT, UH, AGAIN, THAT'S JUST SORT OF BASED ON THE PREVIOUS ANALYSIS, BUT, BUT THAT'S THAT WE HAVE TO SHARE TODAY.
YEAH, THAT'S MY INTUITION TOO, THAT, UH, 4,000 LEVEL WILL BE LOWER, BUT I WAS THINKING MORE ALONG THE 6,500 RANGE OR 7,000, WHETHER IT IS MORE THAN FOUR HOURS, SO THE 10 VERSUS 20, UM, WOULD IT MAKE A DIFFERENCE AND WOULD FIVE VERSUS 10 OR ALL THOSE, WHAT, WHAT'S THE RIGHT NUMBER? BUT, UM, GIVEN THE TIMELINE, UH, UH, GIVEN THE SHORT TIMELINE FOR ANALYSIS, I CAN UNDERSTAND, UH,
[01:35:01]
WHERE IT IS COMING FROM AND, UM, OKAY.THANKS FOR LOOKING AT THE DATA.
YEAH, CLIFF, I WAS JUST WONDERING WHERE YOU WANT TO GO NEXT? ARE YOU READY TO START TO MOVE ON THIS, OR WHAT DO YOU WANNA TAKE NEXT STEP? YEAH, SO MY THOUGHTS WERE IS THAT I WOULD GO AHEAD AND ALLOW ERIC TO WALK THROUGH HIS COMMENTS AND THEN, UH, SINCE THERE WAS SOME OVERLAP, UH, WITH RDC POSITIONS AND SO FORTH, AND THEN, UH, AND THEN ALLOW, I WALK THROUGH THEIR COMMENTS FOLLOWING THAT, THEN WE'LL TRY TO NARROW THIS DOWN AT THAT POINT.
OH, YEAH, I FORGOT YOU SAID THAT.
ANY OTHER QUESTIONS FOR DAVE AT THIS POINT? ALL RIGHT, HERE, NONE.
DAVE, YOU'RE OFF THE HOOK FOR RIGHT NOW, BUT, UH, DON'T GO FAR.
I'M SURE WE'LL HAVE SOME MORE QUESTIONS FOR YOU.
UH, ERIC, UH, IF YOU DON'T MIND, WE'RE GONNA PULL UP YOUR COMMENTS IF YOU WANTED TO ADDRESS ANYTHING THAT'S MAYBE NOT OTHERWISE WRITTEN IN HERE, IF YOU WANTED TO ELABORATE ON ANYTHING WE WANTED TO GIVE YOU THAT OPPORTUNITY.
I APPRECIATE THAT CLIFF AND BOB, I'M GLAD YOU ASKED THAT QUESTION BECAUSE I HAD FORGOTTEN I WAS ON NEXT OR GAVE ME A CHANCE TO, YOU KNOW, HAVE 10 SECONDS PREPARE.
UM, BUT, UH, A FEW THINGS HERE.
UM, UH, FIRST I JUST WANT TO REFLECT THAT THESE ARE, UM, I, I CHECKED OUT THE EMAIL, BUT, UH, WE SPENT ABOUT A, A WEEK WORKING ON KIND OF A JOINT TACT MEMBER POSITION ON THESE ITEMS. UM, SO THIS REFLECTS, UM, KIND OF ALL OF THE, UM, MEMBERS OF TACT THAT ARE IN THE CONSUMER SEGMENT.
UM, BUT I, I'M THE ONE HALF PERCENT OF THE EMAIL, SO IF, UH, CONSUMER MEMBER WANTS TO EMPHASIZE SOMETHING OR SAY SOMETHING THAT I MISSED NOW I, I APPRECIATE THAT.
UM, BUT, UH, FIRST OF ALL, JUST GOING THROUGH, YOU KNOW, FROM ONE THROUGH THREE HERE, UM, WE APPRECIATE THAT, UM, YOU KNOW, ERCOT DIDN'T WANT TO SPEND TOO MUCH TIME ON THE D R S THROUGH, UM, THIS PROCESS BECAUSE THEY THINK THAT THEY CAN'T HAVE IT COMPLETED IN THE TIMEFRAME OF WHAT THEY'VE DECIDED A BRIDGE SOLUTION IS.
UM, UH, HOWEVER, WE THINK THAT THAT IS, UH, UNNECESSARILY LIMITING, UM, AND COULD, UM, YOU KNOW, LOOK AT WAYS TO, TO DO SOMETHING WITH THAT TIMEFRAME.
SO FOR EXAMPLE, IN OUR LAST SENTENCE OF THAT PARAGRAPH, WE NOTE THAT YOU COULD ANNOUNCE A COMMITMENT TO A SIZE OF A PROCUREMENT IN THIS TIMEFRAME.
UM, AND, AND WE BELIEVE THAT WOULD NECESSARILY HAVE AN IMPACT ON THE FOREIGN MARKET.
UM, SO ON, UM, 0.2, UM, I THINK WE STATED A LOT OF THIS PREVIOUSLY.
UM, UM, BUT ONE THING THAT WE DIDN'T DISCUSS WAS, YOU KNOW, WHY $500 MILLION IS NECESSARILY THE APPROPRIATE TARGET.
UM, SO, UM, JUST BECAUSE THE ETHER REPORT SAID THE NET COST OF THE PCMS 500 MILLION DOESN'T MEAN THAT THAT IS NECESSARILY A NUMBER THAT, UH, HAS TO BE, UH, PARTICULARLY ACHIEVED BY THIS EXERCISE.
AND SO, YOU KNOW, SO RHETORICALLY WE ASK WHY $250 MILLION IS NOT EQUALLY APPROPRIATE, UM, AND, UM, WE, WE WOULD APPRECIATE SOME ADDITIONAL JUSTIFICATION AS TO WHY WE'RE TARGETING THIS PARTICULAR, UH, REVENUE TRANSFER.
SO, YOU KNOW, FOR EXAMPLE, UM, IS IT AT $500 MILLION THAT WE ACHIEVED THE REC BENEFITS THAT ERCOT WANTS, OR IS THAT HAPPENED AT SOME OTHER NUMBER? UM, I, I DON'T THINK WE, WE HAVE ANY SORT OF ANALYSIS THAT SHOWS THAT.
AND THEN FINALLY, UM, FOR 0.3, UM, THIS IS, UM, SOMETHING WHERE WE APPRECIATE THAT THIS SEEMS TO BE A, UM, A DESIRE TO HAVE A PARTICULAR OUTCOME FROM THESE, UM, REVENUE TRANSFERS OR CHANGES IN, IN COSTS OF RDC OR WHATEVER ELSE.
SO WE'RE, UM, WANT TO MAKE THE POINT HERE THAT, UM, WE WOULD HOPED TO BE ABLE TO DEMONSTRATE A PARTICULAR RESULT OF THIS AND NOT JUST HIRE BILLS.
AND WHILE I AGREE, UM, WITH SOME OF THE COMMENTS THAT, UM, LUMINANT HAD IN RESPONSE TO THIS, THAT THIS IS COMPLICATED AND DOLLARS ARE FUNGIBLE, UM, WE, WE'D LIKE TO SEE SOME ABILITY TO CONNECT THE DOTS HERE BETWEEN, UM, WHAT HAPPENED, UM, AS A RESULT OF THIS CHANGE AND, AND THE GOALS OF THIS CHANGE.
SO I DON'T KNOW IF THAT'S SOME LATER
[01:40:01]
ANALYSIS, AND I SEE MARK'S IN THE QUEUE HERE.UM, UM, SO, UH, WITH THAT, I'LL, I'LL SHUT UP AND LET ANOTHER CONSUMER, UM, MAKE, MAKE AN ADDITIONAL POINT.
MARK FLOOR'S, ALL YOURS? YEAH, CAN YOU HEAR ME? YES, SIR.
UM, SO OF THESE CONSUMER COMMENTS, UH, THE ISSUE THAT IS IMPORTANT TO ME IS NUMBER THREE, THE TRANSPARENCY AND REPORTING.
YOU KNOW, BOTTOM LINE, UM, THESE TH THIS PROCESS WE'RE GOING THROUGH, WHICHEVER OF THE THREE OPTIONS, IS THE OUTCOME IS GOING TO CREATE A SIGNIFICANT WEALTH TRANSFER FROM CONSUMERS TO GENERATORS.
AND, AND THERE'S NO OBLIGATION ON THE PART OF THE GENERATORS AT THE END, NOR ARE, ARE THEY COMPETING FOR THESE FUNDS? THESE ARE JUST FUNDS THAT WILL BE TRANSFERRED TO REACH A TARGET.
UM, GIVEN THAT THAT IS THE OBJECTIVE HERE, I THINK IT IS IMPORTANT THAT WE GET SOMETHING ON THE OTHER END, SOME COMMITMENTS THAT THESE FUNDS WILL BE USED FOR THE PURPOSES THAT ARE, UH, ARE LAID OUT, THE, THE INVESTMENT IN, UH, EXISTING GENERATION AND IN NEW GENERATION.
UM, I MEAN, I'M NOT GONNA ASK THE GENERATORS TO COMMIT TO BUILD NEW RESOURCES.
I THINK LEGISLATORS HAVE ASKED THEM THAT, AND, AND, AND THERE'S NO SUCH COMMITMENT.
UM, SO THAT'S NOT WHAT I'M ASKING FOR HERE.
BUT IF WE ARE GONNA MAKE SUCH A SIGNIFICANT TRANSFER, I, I THINK IT'S A FAIRLY REASONABLE ASK THAT THERE BE TRANSPARENCY AND REPORTING AS TO WHAT'S HAPPENING WITH THOSE REVENUES.
AND, AND I SAW, YOU KNOW, LUMINA'S COMMENTS AND, AND THAT'S FINE.
AND I, AND I APOLOGIZE THAT LUMINANT FOLKS HAD TO WORK OVER THE WEEKEND ON EASTER WEEKEND IN RESPONDING TO THESE COMMENTS.
BUT I, I'D LIKE TO ASK THEM WHAT DO THEY THINK IS AN, IS AN APPROPRIATE, UH, STEP THAT THEY CAN TAKE IN REPORTING SO THAT THIS COMMUNITY, THE, THE BOARD MEMBERS WHO HAVE TO APPROVE THIS, THE COMMISSIONERS, THE LEGISLATORS, ACCESS CONSUMERS CAN BE COMFORTABLE THAT THESE FUNDS WILL BE COMMITTED TO THE OBJECTIVES THAT THEY ARE INTENDED.
ANY OTHER COMMENTS OR QUESTIONS, ERIC OR ANYONE ELSE ON THE COMMENTS THAT WERE FILED, UH, OR THAT WERE PROVIDED TO US? FILED IS PROBABLY NOT THE RIGHT WORD.
SO, ERIC, QUICK QUESTION ON THE TRANSPARENCY AND THE REPORTING.
SO ARE, ARE YOU ALL ENVISIONING THAT THIS WOULD BE SOMETHING THAT THAT WOULD COME BACK AT SOME CERTAIN POINT, WHEREAS, YOU KNOW, IF THESE, UM, REPORTS ARE MADE AVAILABLE OR, YOU KNOW, THIS INFORMATION IS MADE AVAILABLE, ARE YOU ENVISIONING LIKE AN UPDATE AT A LATER TIME WHERE THIS INFORMATION WOULD BE RELAYED AND SHARED, OR WHAT WERE, WHAT WERE YOU ENVISIONING ON THE, THE TRANSPARENCY AND THE REPORTING ELEMENT ON NUMBER THREE? UH, UH, GOOD QUESTION.
I, I WELCOME MARK TO EXPOUND ON THAT SOME MORE.
BUT YOU KNOW, IN GENERAL, WE'RE LOOKING FOR SOME, UH, LOOK BACK, UH, TO SAY, OKAY, THIS IS WHAT, UM, WAS APPARENTLY EARNED.
AND, UM, ALSO HOW IT CHANGED IN SORT OF BEHAVIOR.
UM, I'VE GOT A FEW, UH, THINGS, UM, THAT I'D LIKE TO A ADDRESS, UM, AND MAYBE A COUPLE OF QUESTIONS.
UM, SO, UH, LET ME START OFF WITH WHERE WE, THE LAST SET OF QUESTIONS.
UM, AS I SAID PREVIOUSLY, UH, IN, IN THE T MEETING, I GUESS LAST WEEK, UM, I AGREE WE, WE WILL NEED TO DO ANALYSIS AND, AND SUPPORT THAT AND, AND TUNE THIS TO SOME DEGREE.
AND, UM, YOU KNOW, UH, WE WOULD LIKE TO DO THAT, WE WOULD PLAN TO DO THAT.
UM, BUT I DO THINK AS THIS, UH, ISSUE ROLLS TO THE COMMISSION, PEOPLE DON'T WANT THAT KIND OF, UH, FOLLOW UP.
UM, SHOULD MAKE THAT CLEARING COMMENT, UH, TO THE COMMISSION.
UM, NEXT, UH, I'LL TRY, I'M GONNA TRY AND AT LEAST TALK ABOUT THE WHY 500, UM, THAT WAS, UH, BROADLY,
[01:45:01]
UH, ASSOCIATED WITH A RELIABILITY, UH, AREA THAT, UM, THE COMMISSION HAD EXPRESSED AN INTEREST IN.BUT I DON'T THINK WE NECESSARILY ARE, ARE LIMITED TO THAT.
AND AGAIN, I WOULD ENCOURAGE PEOPLE THAT WANT TO DO SOMETHING LESS TO, UH, COMMUNICATE THAT TO THE COMMISSION CUZ THIS IS ULTIMATELY THEIR DECISION TO MAKE.
UM, AND, UH, I, I, UH, BUT YOU KNOW, WHAT'S THE BEST WAY TO SAY THIS? THIS SEEMED TO FALL WITHIN A BRIDGE TO THE DELAY AND THE DELIVERY OF PHASE TWO.
SO, UM, BUT I, I DON'T NECESSARILY THINK IT HAS TO BE THAT WAY.
SO THERE'S BEEN A LOT OF REQUESTS FOR, UM, MY NEXT THINGS ARE GONNA BE QUESTIONS FIRST.
ONE IS, UM, THERE'S BEEN A LOT OF, YOU KNOW, REQUESTS FOR ANALYSIS AND THINGS LIKE THAT FROM US, BUT, UM, BOTH ERIC AND MARK SEEM TO BE SAYING, DO NOTHING UNLESS YOU CAN PROVE THIS OR THAT TO ME.
AND MY QUESTION TO THEM IS, HAVE YOU DONE ANY ANALYSIS THAT SHOWS A MARKET IMPROVEMENT IN RELIABILITY IF WE FOLLOW YOUR RECOMMENDATION? IN OTHER WORDS, UM, IF WE WERE TO DO, UH, THIS B UH, THE THE ANCILLARY SERVICE, DO YOU HAVE SOME ANALYSIS THAT SHOWS SOME KIND OF MARKET IMPROVEMENT IN MARKED, I'M SORRY, IMPROVEMENT IN, UH, LONG-TERM RESOURCE ADEQUACY? UH, BECAUSE THERE IS EVIDENCE THAT IF WE RELY ON THE ENERGY ONLY MARKET RELIABILITY WILL NOT IMPROVE, BUT GET WORSE.
UM, AND IT SEEMS LIKE FALSE ALTERNATIVE IS RELY ON THE ENERGY ONLY MARKET ULTIMATELY.
UM, AND THEN LASTLY, UH, UH, I DO HAVE A QUESTION FOR MARK IN TERMS OF MARKET DESIGN WHERE, UH, I MEAN IF YOU WANNA GUARANTEE, DOESN'T THAT START LOOKING LIKE A CAPACITY MARKET? UM, AND IS THAT ULTIMATELY WHERE YOU'RE AT ON ALL OF THIS? OKAY.
I'M NOT, I DON'T THINK IT'S A INACCURATE CHARACTERIZATION OF WHERE I'M AT.
I'M SAYING THAT THERE IS GOING TO BE A SIGNIFICANT WEALTH TRANSFER FROM CONSUMERS TO GENERATORS FOR A SPECIFIC PURPOSE.
THAT PURPOSE IS, IS EXPLAINED IN, UH, IN, UH, ER'S ORIGINAL COMMENTS ON THIS.
UM, AND I THINK IAN LISTED THE, THE FOUR OBJECTIVES AND HIS RESPONSE AND THE, THE TWO PRIMARY OBJECTIVES ARE GET NEW GENERATION BUILT AND INVEST IN EXISTING GENERATION.
UH, MY QUESTION IS, WHY ARE WE MAKING A WEALTH TRANSFER TO CONS FROM CONSUMERS TO GENERATORS IF THERE'S NOT SOME ASSURANCE THAT THAT WILL BE THE OUTCOME? SO I WOULD LIKE ASSURANCE, AND I THINK THE BEST WAY TO PROVIDE THAT INSURANCE IS SOME TRANSPARENCY AND REPORTING AS TO WHAT ACTIVITIES ARE, UH, THE GENERATORS ARE INVOLVED IN.
AND THAT CAN BE FILINGS AT THE COMMISSION THAT DEMONSTRATE WHAT INVESTMENTS THEY'RE MAKING AND WHAT THEIR PLANNING IS ON THOSE INVESTMENTS OR SOME, SOME OTHER MEASURE.
I, I'M OPEN TO HEAR WHAT THE GENERATORS THINK IS APPROPRIATE, BUT IF WE'RE GUARANTEEING, ESSENTIALLY GUARANTEEING A NEW REVENUE STREAM TO GENERATORS WHO ARE NOT COMPETING FOR THAT REVENUE, IT IT'S, IT'S JUST MONEY ADDED BECAUSE WE'RE CHANGING A, AN ADMINISTRATIVELY DETERMINED DEMAND CURVE SHAPE, THEN I, I THINK THERE SHOULD BE SOMETHING ON THE OTHER END THAT SAYS, YES, WE'RE GONNA DO WITH THESE FUNDS, WHAT WAS INTENDED TO STRENGTHEN OUR, OUR NETWORK.
UM, I'M, I'M GONNA, CAN I JUMP IN OR, OR MAYBE YOU'RE GONNA JUMP IN.
YEAH, YEAH, I, I WAS JUST GONNA JUMP IN FOR JUST A SECOND.
IN TERMS OF REPORTING AND TRANSPARENCY AND SO FORTH, UM, I, I THINK THOSE ARE ALL GOOD ARGUMENTS TO MAKE.
I DON'T KNOW THAT THOSE ARE NECESSARILY HELPFUL FOR US TO DATE FOR PURPOSES OF DISCUSSING WHAT OUR RECOMMENDATION IS GONNA BE ON A BRIDGE MECHANISM.
THOSE ARE PROBABLY ARGUMENTS THAT ARE GONNA BE BETTER MADE, UH, OVER AT THE COMMISSION.
TO KENNAN'S POINT IN THAT REGARD, I THINK WHAT, WHAT WE'RE TASKED WITH DOING FROM THE BOARD AND FROM THE COMMISSION IS HELPING TO DEVELOP WHAT THAT RECOMMENDATION IS GOING TO BE FROM THE ERCOT BOARD TO THE COMMISSION.
[01:50:01]
SO, UM, I, I THINK THESE ARE ALL GOOD ARGUMENTS.THESE ARE ALL GOOD DEBATES, BUT AT THE SAME TIME, I THINK WE NEED TO MAKE SURE THAT WE HAVE, THAT WE REIGN THIS IN A LITTLE BIT AND FOCUS ON, ON WHAT THE INTENT IS, AND THAT'S TO PROVIDE A RECOMMENDATION ON THE BRIDGING MECHANISM.
COULD I HAVE A QUICK RESPONSE TO THAT? YEAH, GO AHEAD, MARK.
I'M, I'M NOT GONNA BE AT THE BOARD MEETING NEXT WEEK CAUSE UH, SOMEBODY SCHEDULED THE BOARD MEETING OVER THE TOP OF THE GULF COAST POWER ASSOCIATION CONFERENCE, SO I WON'T BE THERE, BUT I WOULD LIKE WHOEVER'S PRESENTING THIS INFORMATION TO THE BOARD TO ADD THE POINT THAT CONSUMERS REQUEST SOME SORT OF REPORTING OR TRANSPARENCY SO THAT WE UNDERSTAND THE ENDPOINTS, THAT'S IT.
AND, AND THAT WE MAKE THAT REQUEST TO THE BOARD SO THE BOARD CAN CONSIDER THAT IN ITS REPORT TO THE COMMISSION.
CHRIS, CAN I JUMP IN NOW? I, I THINK THAT MAKES SENSE.
UM, YOU KNOW, I, I THINK ERCOT WAS TASK WITH MEETING A SET OF PARAMETERS FOR A BRIDGING SOLUTION AND PROVIDED THE ANALYSIS, AND I UNDERSTAND THEIR REQUEST FOR ANALYSIS IF WE'RE GONNA PRESENT AN ALTERNATIVE SOLUTION.
I THINK WHAT CONSUMERS ARE SAYING IS, IF OUR RECOMMENDATION IS THIS, THEY'D LIKE TO NOTE THAT IN CONVERSATION, THEY WANTED IT TO COME ALONG WITH TRANSPARENCY AND REPORTING, WHICH I THINK IS FINE, BUT I THINK WE NEED TO BE KIND OF AIMED AT COMING OUT OF TODAY'S MEETING WITH A RECOMMENDATION THAT FALLS UNDER THOSE PARAMETERS OF A, OF A BRIDGING SOLUTION.
AND WE APPRECIATE, YOU KNOW, ERCO SAYING AND THOSE PARAMETERS AND DOING THAT ANALYSIS.
AND YOU CAN TAKE ME OUTTA THE QUEUE.
THAT'S, I JUST KIND OF WANTED TO GET US ON THAT TRACK AND, AND CLIFF HAD STARTED ALREADY AND, UM, SORRY TO ADD TO THE CHAOS OF THIS, UM, BUT KAAN ASKED ANOTHER QUESTION ABOUT REPORTING AND JOHN IS IN THE QUEUE TO ANSWER'S QUESTION.
THEN, THEN IF IT'S SPECIFIC TO THAT, YEAH, JOHN, YOU CAN, YOU CAN JUMP TO THE QUEUE, UH, FRONT OF THE QUEUE.
CAN YOU HEAR ME OKAY? SURE CAN JOHN.
UM, I THINK, UH, KAAN TWO POINTS.
I THINK FIRST, THERE'S, THERE'S NO ACTUAL STUDY SHOWING THAT THE CURRENT REVENUE STREAM ISN'T SUFFICIENT AFTER ALL THE PHASE ONE MARKET DESIGN CHANGES.
UM, SO I THINK THAT GOES TO YOUR QUESTION.
THEN I THINK THE SECOND, A SECOND POINT IS THAT, UH, T I E C TAM, UH, TEGA AND OTHERS FUNDED A, A BATES WHITE STUDY THAT SHOWS THAT IMPLEMENTING AN ANCILLARY SERVICE SIMILAR TO DRS, WOULD PROVIDE TARGETED, UH, TARGETED REVENUE TOWARDS DISPATCHABLE RESOURCES, UM, THAT WOULD INCREASE RELIABILITY AND PROVIDE AN ANNUAL REVENUE OF APPROXIMATELY 1.7 BILLION DIRECTED TOWARDS DISPATCHABLE RESOURCES SPECIFICALLY.
KENAN, DID YOU WANNA COMMENT ON ANYTHING OR? YEAH, UH, I DON'T BELIEVE THAT STUDY, UH, SAYS ANYTHING DIFFERENT THAN THE E THREE BASE CASE STUDY, WHICH SHOWS LONG-TERM RESOURCE ADEQUACY GETTING WORSE, UH, BY 2026.
SO, UH, I, BUT I'M HAPPY TO, UH, I MEAN, I, I THINK IT'D BE USEFUL FOR THAT, THOSE STUDIES THAT WERE REFERENCED TO BE FILED THE COMMISSION, UH, FOR OTHERS TO REVIEW.
UM, SO NOW WE'LL GO TO TAC MEMBER EMERITUS RANDY JONES.
UH, I'VE BEEN LISTENING IN AND, AND MY COMMENTS SHOULD ONLY BE CONSTRUED AS THOSE OF A RESIDENTIAL CONSUMER AT THIS POINT.
AND I, I AGREE, UH, FUNDAMENTALLY WITH, UH, WITH MARK'S POSITION, THIS IS A HUGE WEALTH TRANSFER THAT WE'RE ADMINISTER ADMINIS ADMINISTRATIVELY PROPOSING TO, UH, IMPOSE.
AND, UM, I, I GET NERVOUS WHEN WE TALK ABOUT MECHANISMS TO ABSOLUTELY PUSH MONEY FROM, UH, THE DEMAND SIDE TO THE SUPPLY SIDE WITHOUT REAL JUSTIFICATION AND WITHOUT, WITHOUT DELVING
[01:55:01]
INTO WHAT THE POTENTIAL UNATTENDED CONSEQUENCES ARE.THIS, THIS IS A HUGE TRANSFER.
AND IT SEEMS TO ME THAT MAYBE IT'S NOT SURGICAL ENOUGH IN THE SENSE THAT, UH, I UNDERSTAND THAT ERCOT TRIES TO BE ACUMENICAL WHEN IT COMES TO WHO GETS IMPACTED.
THEY TRY NOT TO GORE SPECIFIC OXES.
BUT IT SEEMS TO ME THAT THE POLICY SHIFT THAT IS OCCURRING, UH, IN AUSTIN IT, AND THAT THE COMMISSION AS WELL IS ONE THAT SAYS, LOOK, WE'RE WE'RE TIRED OF FEEDING MONEY TO RENEWABLE RESOURCES AND ALLOWING THEM TO ENJOY THE BENEFITS OF THE O R D C THAT DISPATCHABLE UNITS ACTUALLY EARN.
AND I KNOW IT'S BLASPHEMY, UH, ERCOT SPOKES ARE PROBABLY STARTING TO BITE THEIR NAILS, BUT IT SEEMS TO ME THAT WHATEVER CHANGE FOR A BRIDGE MECHANISM WE PUT IN PLACE SHOULD CONTAIN A PROPOSAL OF NOT PAYING ADDITIONAL REVENUES TO, UH, WIND AND SOLAR AND FOCUSING ON MOVING THOSE REVENUES STRICTLY TO WHAT IT IS YOU'RE TRYING TO ENCOURAGE, WHICH IS DISPATCHABLE GENERATION.
I, AND I COULDN'T AGREE MORE WITH MARK IN THE SENSE THAT WE NEED TO KNOW WHAT THE OUTCOME'S GONNA BE IF THIS IS ACTUALLY GOING TO, TO SERVE THE, THE POLICY DECISIONS THAT THE COMMISSION HAS MADE.
AND, UM, MAYBE IT'S TIME THAT WE SHIFT FROM BEING, UM, REVENUE NEUTRAL TO BEING MORE TARGETED WITH THESE CHANGES.
AND, UH, I'LL LEAVE IT AT THAT.
THANK YOU FOR, UH, THE OPPORTUNITY TO TALK ANYTIME, RANDY.
ANY OTHER COMMENTS OR QUESTIONS FOR ERIC? OKAY.
HERE AND NONE, ERIC, THANKS FOR, UH, PULLING THAT TOGETHER AND, AND GETTING THAT OUT TO THE GROUP, UH, THIS WEEKEND.
UM, WE'LL GO AHEAD AND TURN NOW TO IAN TO TALK THROUGH THE COMMENTS THAT THEY PUSHED OUT YESTERDAY EVENING.
I'M GONNA TURN OVER TO NED IN A SECOND.
UH, HE DESERVES A CREDIT FOR WORKING OVER THE WEEKEND.
UM, BUT, UH, JUST WANTED TO JUST BRING ONE POINT TO THE, THE DISCUSSION ON THE REPORTING.
UM, I THINK THIS IS A DISCUSSION THAT'S MUCH BETTER HELD AT THE COMMISSION.
UM, IT'S ALSO BECAUSE, UM, MANY OF OUR COMPANIES HAVE S E C REPORTING REQUIREMENTS, AND I WOULD REALLY LIKE THE TIME TO WORK WITH OUR LEGAL TEAMS AND INVESTOR RELATION TEAMS, UM, TO DISCUSS THOSE REQUIREMENTS AND MAKE SURE, UM, THESE REQUIREMENTS, UH, YOU KNOW, WOULDN'T VIOLATE FEDERAL LAW.
UM, SO I JUST KNOW THAT, UM, OUR COMPANY, I KNOW FROM SPEAKING WITH OUR INVESTOR RELATIONS TEAMS, N R G, UH, OVER THE YEARS, HAS, UM, STRUGGLED WITH HOW TO REPORT THINGS CORRECTLY, UM, AND STRUGGLED, I SHOULDN'T SAY THAT, STRUGGLED WITH HOW TO REPORT THINGS IN A WAY THAT WALL STREET IS COMFORTABLE WITH UNDERSTANDING THE DIFFERENT BUSINESS UNITS.
AND THEREFORE, I WOULDN'T WANT SOMETHING OUT THERE THAT, UM, YOU KNOW, SUPERSEDED THAT.
BUT, UM, JUST WANTED TO SAY THAT, UM, THINK AGAIN, IT'D BE JUST A CONVERSATION BETTER HELD, UM, THROUGH A RULEMAKING, UM, IF THE COMMISSION WANTED TO TAKE IT UP.
BUT, UM, AGAIN, NED, UH, DESERVES ALL THE CREDIT FOR OUR COMMENTS AS HE WORKED ON THEM, UH, THIS WEEKEND.
CAN Y'ALL HEAR ME? WE SURE CAN, NED.
UM, WELL, I GUESS JUST DOVETAILING OFF OF, UM, MAUREEN WAS GOING THERE AND THE QUESTIONS POSED ABOUT, YOU KNOW, WHAT, WHAT, WHAT'S THE RIGHT KIND OF REPORTING OR HOW DO YOU GET GUARANTEES, YOU KNOW, IN A MARKET, YOU, YOU DON'T GET GUARANTEES, YOU GET INCENTIVES, AND THOSE INCENTIVES DRIVE OUTCOMES THAT, YOU KNOW, CAN BE OBSERVED AND MEASURED IN DIFFERENT WAYS, BUT YOU KNOW, YOU HAVE TO TRUST IN THE MARKET TO PROVIDE SIGNALS THAT ARE GOING TO, TO GET YOU WHAT YOU WANT.
UM, YOU KNOW, IT'S LIKE THE OLD ADAGE GOES, THERE'S NO NO, NO LARGE BILLS LEFT ON THE SIDEWALK BECAUSE, YOU KNOW, IF YOU PUT THE, UH, THE MONETARY INCENTIVE OUT, SOMEONE'S GONNA PICK IT UP AND AND FOLLOW IT.
UM, SO, YOU KNOW, I DON'T THINK IT'S APPROPRIATE TO ASK FOR GUARANTEES OR, YOU KNOW, FOR INDIVIDUAL COMPANIES TO REPORT PUBLICLY ON COMPETITIVELY SENSITIVE ACTIVITIES THAT THEY MAY BE ENGAGED IN.
UM, BUT THAT DOESN'T MEAN THAT THERE AREN'T WAYS TO, YOU KNOW, TO EVALUATE, TO PROPOSE CHANGES.
[02:00:01]
KNOW, FOR INSTANCE, UM, YOU KNOW, ERCOT DOES PRODUCE AN ANNUAL O RDC REPORT NOW, AND SO THAT MAY BE AN APPROPRIATE PLACE TO, YOU KNOW, LOOK AT SOME OF THESE CHANGES IN AGGREGATE.AND THAT'S WHERE THEY ACTUALLY, UH, YOU KNOW, LAST YEAR OBSERVED THAT THE INITIAL O RDC CHANGES ACTUALLY DROVE AN OUTCOME IN, UH, SELF-COMMITMENT.
UM, SO, YOU KNOW, THAT MAY BE AN APPROPRIATE PLACE IN AN APPROPRIATE LEVEL, YOU KNOW, SOME OF THE SIMILAR KINDS OF, UH, ANALYSIS THAT ARE CUTS PUT TOGETHER IN THE BACKCAST FOR TODAY TO SHOW, YOU KNOW, WHERE, WHERE REVENUE'S GOING TO DIFFERENT TYPES OF RESOURCES UNDER THE DIFFERENT BACKCAST, UH, VERSUS THE, THE CURRENT OR HISTORICAL.
UM, THAT MAY ALSO BE A, YOU KNOW, A WAY TO LOOK AT IT.
UM, YOU KNOW, I, I THINK OUR PRIMARY OBJECTIONS TO WHAT WAS IN THE CONSUMER'S PROPOSALS WAS THAT IT WAS, UM, YOU KNOW, TRYING TO PUT A A BASICALLY AN IMPOSSIBLE STANDARD ON, UH, INDIVIDUAL COMPANIES THAT THAT WOULDN'T BE ABLE TO, TO SUPPORT.
SO, UM, YOU KNOW, WE'LL LEAVE THAT ONE WHERE IT IS.
UM, YOU KNOW, AS FAR AS THE OTHER TOPICS THAT WE COVERED, GO, UM, YOU KNOW, I THINK, I DON'T WANNA REPEAT EVERYTHING THAT WE'VE ALREADY TALKED ABOUT
BUT, YOU KNOW, WE DO THINK THAT, YOU KNOW, D R S IS, YOU KNOW, MAY WARRANT FURTHER DISCUSSION.
UM, WITH ALL DUE RESPECT, WE DON'T BELIEVE THAT THE BATES WHITE STUDY WAS ACTUALLY A STUDY OF ALL OF THE IMPACTS THAT THE D R R S, UH, CONCEPT ENTAILS, AND THAT IT WOULD REQUIRE A LOT MORE STAKEHOLDER DISCUSSION TO REALLY FLESH THINGS OUT AND, AND EVALUATE WHAT, YOU KNOW, HOW IT WOULD BE STRUCTURED, WHAT PROBLEMS IT WOULD TRY TO SOLVE.
YOU KNOW, BASICALLY THE SAME KIND OF DISCUSSIONS THAT WE'RE HAVING TODAY.
UM, AND, AND FRANKLY, YOU KNOW, WE, WE AGREE WITH THE MURCOTTS GIVEN ON ON THAT, WHICH IS WE'VE GOT ECR R S THAT'S ABOUT TO GO LIVE IN JUNE, THAT'S GONNA CHANGE.
UM, YOU KNOW, SOME, THAT'S GONNA CHANGE HOW SOME OF THE, UM, SOME OF THE JUSTIFICATIONS BEHIND THE D R S, UM, MAY LOOK AND SOME MAY, IT'S PROBABLY BETTER TO LOOK AT THAT AFTER E C R S GO LIVE AND SEE HOW, UM, SEE, SEE WHAT THE GRID'S NEEDS ACTUALLY ARE AT THAT TIME.
UM, BUT WE DON'T THINK IT CAN BE DONE CORRECTLY AND QUICKLY IN A WAY THAT, UM, YOU KNOW, MAKES AN APPROPRIATE BRIDGE SOLUTION.
SO I THINK THAT'S, THAT'S THE BIGGEST ITEM THERE.
UM, AND AS FAR AS THE, THE RDC ENHANCEMENTS, I, I, I DO THINK WE ACTUALLY, UM, WE ACTUALLY I THINK, AGREE WITH THE CONSUMERS THAT, YOU KNOW, THERE ISN'T NECESSARILY A DOLLAR TARGET THAT WE'RE LOOKING FOR HERE.
UM, YOU KNOW, THE, THE, WHAT WE, THE VALUE THAT WE SEE IN OUR COTS PROPOSAL AND THEIR PREFERRED SOLUTION IS THAT IT IS FAIRLY WELL TARGETED TO ADDRESS, I THINK WHAT HAS BEEN ONE OF THE MOST COMMON COMPLAINTS WE'VE HEARD OVER THE LAST, UH, YOU KNOW, YEAR AND A HALF, ALMOST TWO YEARS, WHICH IS RUCKS.
AND, YOU KNOW, WHILE IT, IT MAY NOT SOLVE EV EVERY SINGLE INSTANCE OF A RUCK, UH, YOU KNOW, IT, IT SEEMS TO BE STRUCTURED IN A WAY THAT WILL GIVE THE GREATEST, UH, ABILITY TO REDUCE THOSE.
AND, YOU KNOW, THAT ALSO HAS THE BENEFIT THEN OF HELPING TO PRESERVE EXISTING RESOURCES, PARTICULARLY THOSE THAT HAVE BEEN COMMITTED THROUGH RUCKS SIGNIFICANTLY.
YOU KNOW, Y'ALL RECALL THAT ONE OF THE, UH, ONE OF THE REASONS GIVEN FOR, UH, ONE OF THE, THE MORE RECENT NSOS THAT WAS FILED IN DECEMBER WAS THAT THE UNIT HAD BASICALLY BEEN WRECKED TO DEATH.
SO, UM, YOU KNOW, FINDING WAYS TO GET THOSE TO HELP THOSE RESOURCES FIND A WAY TO GET, UH, COMMITTED IN THE MARKET, UM, IS, IS BETTER THAN, THAN LEAVING THEM SUBJECT ONLY TO DRUG COMPENSATION.
UM, YOU KNOW, BEHAVIORAL ADJUSTMENTS WILL CHANGE HOW THE, THE ACTUAL, YOU KNOW, REALTIME REVENUE COSTS SHAKE OUT AND TO THE POINTS, UH, THAT I THINK WE'VE TRIED TO MAKE CLEAR RESOURCES DON'T ACTUALLY, UH, YOU KNOW, ONLY GET PAID THE REALTIME REVENUES.
THEY, YOU KNOW, RESOURCES HEDGE THEIR OUTPUT.
UM, AND, YOU KNOW, LOADS ALSO BY AND LARGE DON'T PAY THE REALTIME PRICES.
SO WHILE IT'S, WHILE THEY'RE IMPORTANT INDICATORS AND PROVIDE IMPORTANT, UM, INCENTIVES, YOU KNOW, THAT'S NOT THE BE ALL END ALL.
IT'S NOT NECESSARILY, YOU KNOW, IF YOU HAVE A REALTIME OUTCOME, THAT DOESN'T NECESSARILY MEAN THERE IS THAT SPECIFIC WEALTH TRANSFER THAT MEANS THERE IS THAT IMPACT IN REAL TIME, BUT HOW IT ACTUALLY SHAKES OUT IN, UH, FROM A FINANCIAL STANDPOINT IS GOING TO BE MUCH MORE, MUCH MORE COMPLICATED.
SO, UM, I THINK I CAN PROBABLY PAUSE THERE.
UM, OH, I DID IT, IT ALSO DID WANNA CALL OUT SPECIFICALLY IN THE COMMENTS, UM, BEFORE
[02:05:01]
I GO BACK ON MUTE.YOU KNOW, ONE OF THE THINGS THAT THE CONSUMERS COMMENTS DID BRING UP IS THE PEAK NET MARGIN HAS BEEN, UH, YOU KNOW, IN EXCESS OF CONE THREE OUT OF THE LAST FOUR YEARS.
THAT IS SOMETHING THAT, YOU KNOW, IF YOU LOOK AT IT STRICTLY WITHIN THAT, THAT TIMEFRAME, THEN YES, THAT'S TRUE.
BUT YOU KNOW, ONE OF THOSE YEARS WAS WINTER STORM URI AND THERE WEREN'T A LOT OF GENERATORS THAT
IF, AS A MATTER OF FACT, I THINK A LOT OF GENERATORS LOST A SIGNIFICANT AMOUNT OF MONEY THAT YEAR.
SO I THINK WE NEED TO, YOU KNOW, PUT AN ASTERISK ON THAT ONE.
UM, AND THEN THE OTHERS HAVE BEEN, YOU KNOW, EITHER EXTREME MARKET CONDITIONS WHERE WE HAD THE LOWEST RESERVE MARGINS IN ERCOT HISTORY OR EXTREME, YOU KNOW, EXTREME WEATHER, UH, LAST SUMMER, WHICH, YOU KNOW, THE LAST TIME WE HAD SEEN SOMETHING LIKE THAT WAS 2011, WHICH WAS ALSO THE LAST TIME THAT THAT CONE HAD BEEN EXCEEDED.
SO, UM, YOU KNOW, THE, I THINK THAT THAT ARGUMENT NEEDS TO HAVE A LITTLE BIT MORE CONTEXT, AND SO WE JUST TRIED TO PROVIDE SOME, UM, SOME, SOME OF THAT CONTEXT AROUND IT.
UM, FIRST OF ALL, UM, NED, I APPRECIATE THAT YOU WORKED ON THIS THIS WEEKEND.
UM, AND I I JUST WANTED TO POINT THAT OUT, UH, THAT I'M AT LEAST PARTIALLY RESPONSIBLE FOR YOU DOING THAT.
UM, IN REGARDS TO THE, UM, P CONNECT MARGIN DISCUSSION, UM, YOU KNOW, I, I AGREE IT'S AN IMPERFECT MEASUREMENT.
UM, HOWEVER, UM, I, I THINK IT'S, IT'S WORTH REPEATING THAT, UM, IT LED TO HIGHER REVENUE AMOUNTS IN, UH, YEARS WHERE THINGS WERE, YOU KNOW, SOMEWHAT TIGHTER.
SO WE, WE SHOULDN'T EXPECT TO ACHIEVE CONE YEAR IN YEAR OUT, UM, EVERY YEAR, UM, IF WE HAVE SUFFICIENT RESERVES.
AND, AND SO IT'S, UM, IT'S NOT SOMETHING TO, TO CAST, YOU KNOW, DISPARAGEMENT ON IT WHEN YOU, YOU KNOW, AS YOU POINT OUT IT OCCURRED IN THE YEAR THAT WE HAD, UM, TIGHT RESERVE MARGINS OR, OR, OR HIGH WEATHER ISSUES.
UM, IN REGARDS TO THE FORD LOOKING NATURE OF IT, YOU KNOW, OF COURSE YOU'RE CORRECT, UM, THAT, UM, GENERATORS, UM, ARE BUILDING FOR WHAT THEY CAN EARN IN THE FUTURE AND NOT WHAT THEY MIGHT HAVE EARNED IN THE PAST.
UM, HOWEVER, UM, THE INCIDENTS OF HIGH PRICES, UM, AND THE ABILITY FOR ERCOT TO, TO PRINT THOSE DOES AFFECT THE FORD PRICE.
UM, YOU KNOW, THERE'S WAS A LOT OF UNCERTAINTY, UM, BEFORE, UH, 2019 AND 2020 WHETHER OR NOT, UM, THE ERCOT MARKET COULD HAVE SUSTAINED HIGH PRICES.
AND I THINK IT WAS DEMONSTRATED THAT IT COULD.
UM, THERE ARE COMPLEXITIES AT ALWAYS WITH, UM, HEDGING AND GAS, GAS PRICES AND EVERYTHING ELSE.
UM, BUT IT, YOU KNOW, IN GENERAL, I THINK IT'S, IT'S, UM, WORTH NOTING THAT WE HAVE HAD, UM, VERY HIGH ENERGY COST YEARS RECENTLY, AND THAT HAS LED TO PEOPLE, UH, MAKING INVESTMENT DECISIONS.
JUST ON THE, YOU KNOW, I, I, I DO WANT TO STATE FOR THE RECORD, YOU KNOW, AGREE PETER, NET MARGIN IS AN INDICATOR.
IT'S NOT THAT THERE'S NO VALUE TO HAVING IT, AND I THINK IT'S IMPORTANT TO HAVE THAT AS AS SOMETHING TO REFERENCE.
UM, AND, BUT I, I APPRECIATE YOUR, YOUR ACKNOWLEDGEMENT THAT THERE'S, THERE'S BEEN VARI VARIATIONS AND OUTCOMES AND, AND THE FUTURE YEARS AREN'T NECESSARILY, UH, GOING TO BE, UH, REPEATS OF, OF THE PAST YEARS.
AND ACTUALLY WE, UH, IF YOU'LL SCROLL DOWN ON THE, I THINK RIGHT, UH, ON THE NEXT PAGE, WE HAD INCLUDED A LITTLE GRAPH THAT JUST WHERE, UM, YOU KNOW, WE TOOK SOME OF THE FORWARD CURVES AND YOU DID A, YOU KNOW, A ROUGH ESTIMATE OF WHAT PEAK OUR NET MARGIN MIGHT LOOK LIKE.
UM, JUST TO SHOW, YOU KNOW, THAT IT'S NOT REFLECTED IN THE FORWARDS RIGHT NOW.
AND ACTUALLY, UH, I WAS LOOKING AT THE UNDERLYING DATA TO THIS, UM, AND IT, IT LOOKS LIKE WITH THIS, THIS IS ACTUALLY USING THE SEVEN BY 16, NOT THE SEVEN BY 24.
SO TO THE EXTENT THAT THE SEVEN BY 24, UH, IS A LITTLE BIT LOWER, UM, YOU KNOW, WHAT WE SHOW HERE IS, IS PROBABLY A LITTLE BIT MORE GENEROUS, UM, RELATIVE TO WHAT THE, THE FORD EXPECTATIONS ARE REALLY MAKES YOU WONDER ABOUT THOSE E THREE RETIREMENT NUMBERS WHEN YOU LOOK AT THIS GRAPH, DOESN'T IT? OKAY.
[02:10:07]
KAAN, GO AHEAD.UH, THERE WAS TWO MUTES ON FOR SOME REASON, UM, PROBABLY ME, UH, I WANTED TO, UH, RESPOND TO, CUZ I DON'T THINK I CLEARLY DID TO MARK'S REQUEST THAT, UH, AT THE BOARD WE COMMUNICATE THAT THERE NEED WILL NEED TO BE ONGOING, UH, ANALYSIS AND AND EXAMINATION OF THIS IN INSTRUMENT.
UH, I HAD TO ALREADY SUBMIT MY, UH, UM, MY PRESENTATION, BUT I PLANNED TO VOICE THAT OVER AND, AND COVER THAT, SO I JUST DID, I WANTED TO MAKE IT CLEAR THAT WE WERE WILLING TO DO THAT.
SO ANY OTHER COMMENTS OR QUESTIONS FOR NED AT THIS POINT? OKAY, SEEING NONE, HEARING NONE.
LET'S SEE IF WE CAN, UH, TAKE A RUN AT, AT THIS IN, IN TERMS OF HOW WE WANT TO HANDLE THIS.
I HAVE TO GO FROM ONE SCREEN TO ANOTHER TO TO UNMUTE AND MAKE A COMMENT.
YEAH, I MEAN, AFTER ALL OF THIS, I MEAN, THERE'S BEEN REALLY GOOD ARGUMENTS ON ALL SIDES.
UH, THERE'S PROS AND CONS TO EVERYTHING SETTING UP ON THE BOARD.
UH, WE WERE GIVEN SPECIFIC CRITERIA TO TAKE A LOOK AT AND ERCOT IS SUPPOSED TO MAKE A RECOMMENDATION AFTER EVERYTHING I'VE HEARD AND EVERYTHING WE'VE DONE.
I CAN'T MAKE AN ARGUMENT TO SAY THAT ERCOT DOES NOT MEET THAT GOAL, UH, IN A MANNER THAT IS WAS ASSIGNED TO THEM.
UH, AND LOOKING AT THE OTHERS, I CAN'T CLEARLY SAY THAT ANY OF THOSE WOULD BE ANY BETTER.
SO WITH THAT ONE I WOULD HAVE TO SUPPORT THE ERCOT OPTION.
SO HERE'S WHAT CAITLIN AND I WERE THINKING ABOUT DOING, UM, IN, IN THAT REGARD.
SO THE ONE, ONE WAY WE WERE LOOKING AT FRAMING THIS UP IN TERMS OF PRESENTING IT TO RMC WAS THAT, YOU KNOW, WE WOULD COME UP WITH A MAJORITY T POSITION, UM, MAKE KNOWN KIND OF THE MINORITY TECH POSITION CUZ I, I DON'T THINK WE'RE GONNA COME TO A, A POSITION OF TACT THAT'S U UNANIMOUS IN THAT REGARD.
UM, AND SO MY INITIAL THOUGHT WAS THAT WE COULD APPROACH THIS BY TAKING FORTH A RECOMMENDATION TO EITHER ENDORSE THE ERCOT PREFERRED O RDC ENHANCEMENT OR ONE OF THE OTHER, OR D C ENHANCEMENTS, UH, DO MAKE NOTE OF THE MINORITY POSITION AS IT PERTAINS TO, UM, THE CONSUMER REPRESENTATIVE'S POSITION ON BOTH R D C AND ANCILLARY SERVICES.
AND ONCE WE HAVE THOSE STAKED OUT, WE COULD ALSO TALK ABOUT HAVING, UM, INDICATIVE PCM PRICES PU PUBLISHED BECAUSE THAT WAS SOMETHING THAT, UH, TECH KIND OF SOLIDIFIED AROUND AND, AND THERE SEEMED TO BE PRETTY GOOD SUPPORT FOR THAT AT THE LAST MEETING THAT WE HELD.
AND SO I'D LIKE TO HEAR IF ANYBODY HAS ANY OPPOSITION TO THAT APPROACH AT THIS POINT IN TIME.
UM, SEE IF THERE'S ANY STRONG OPPOSITION TO MAKING, UH, YOU KNOW, TAKING THAT TYPE OF POSITION TO THE BOARD.
AND THEN AT THAT POINT IN TIME WE CAN KIND OF WHITTLE DOWN WHICH OPTION WE WANNA MOVE WITH THE ERCOT PREFERRED OR ONE OF THE OTHER TWO OPTIONS.
UH, BUT, BUT I'M CURIOUS TO HEAR ANY FEEDBACK, IF ANY, ON THAT SPECIFIC ROUTE.
OKAY, SO I'M SEEING THE QUEUE IS QUIET, NOBODY'S JUMPING IN, SO I THINK WE WILL GO AHEAD AND START MAKING, UH, PLANS TOWARDS, TOWARDS TAKING A R THAT SPECIFIC ROUTE OR WHATEVER.
SO, SO I, I THINK WHAT WE'VE GOT IS BOB'S GOT A PREFERRED, UH, OR, OR RATHER, IS LOOKING TO, AND I GUESS ENDORSE THE ERCOT PREFERRED O R D C ENHANCEMENT.
UM, IS THERE ANYBODY THAT HAS ANY SPECIFIC OPPOSITION TO THAT OR WOULD RATHER TAKE, UH, YOU KNOW, A LOOK AT OR A VOTE ON EITHER OPTION ONE OR OPTION TWO.
[02:15:02]
SO I'VE GOT A SECOND FROM KEVIN.SO, BOB, DO YOU WANNA MAKE THAT IN THE FORM OF A MOTION THEN? YEAH, UH, I'LL MAKE THE MOTION THAT, UH, THAT T ENDORSED THE ERCOT PREFERRED OPTION AS THE BRIDGING SOLUTION.
AND KEVIN, YOU'RE GOOD WITH THAT AS A SECOND? CORRECT.
A YES FROM KEVIN IN THAT REGARD.
ANY COMMENT ON, ON THE MOTION? UH, MARK.
UH, I'M WONDERING IF BOB WOULD ACCEPT A FRIENDLY AMENDMENT THAT SAYS, ANAC RECOMMENDS THAT THE BOARD, UH, LET'S SEE.
TAC RECOMMENDS THAT THE BOARD REQUESTS THAT THE COMMISSION ESTABLISH APPROPRIATE TRANSPARENCY AND REPORTING STANDARDS.
I HATE TO CONVOLUTE THE ISSUE.
UH, I FULLY AGREE THAT THERE NEEDS TO BE SOME TRANSPARENCY STANDARD.
UH, I WOULD GO AS FAR AS TO, TO PUT IN THERE THAT ER ERCOT WILL REVIEW, UH, THE IMPLEMENTATION AND UH, UH, AND OF COURSE WITH CANON ON WHAT THEY COULD DO TO REVIEW THE IMPLEMENTATION OF IT AND THE REVENUES THAT WERE RECEIVED OR, AND BROKEN OUT THE WAY THEY HAD IT.
SOMETHING ALONG THO THOSE LINES.
BUT WHEN IT GOES TO RECOMMENDING BOB YOU'S STILL THERE, WE MIGHT HAVE LOST YOU.
UH, AND THAT WOULD BE STRICTLY FOR THE COMMISSION AND SOMEONE TO ADDRESS THAT AT THE COMMISSION.
I DON'T KNOW IF THAT HELPS, MARK, BUT BOB, WE MAY HAVE LOST YOU FOR A PRETTY GOOD PORTION OF WHAT YOU SAID, WHICH WAS PROBABLY THE BEST PART OF WHAT YOU SAID.
SO YOU WANNA REPHRASE THAT? OKAY.
YEAH, I HAD A CALL IN COME IN IN THE MIDDLE OF THAT.
SORRY, I WASN'T SURE IF IT COME HERE OR NOT.
WHAT I WAS GONNA SAY, WHAT I WAS SAYING WAS, IS, IS I CAN ADD SOMETHING IN THAT SAYS THAT ERCOT CAN REVIEW THE IMPLEMENTATION OF THE REVENUE TRANSFER, UH, AND POSSIBLY, YOU KNOW, THE, THE, THE BREAKOUT OF WHERE IT'S GOING IN, IN RESOURCE FUEL TIME, BUT TO GO INTO A LEVEL THAT IS ASKING FOR US TO POTENTIALLY HAVE COMPETITORS DIVULGE THEIR GROWTH AND THEIR INVESTMENT STRATEGY, I'M VERY RELUCTANT TO DO THAT FOR A MINI TIER OF REASONS, AND THAT'S SOMETHING THAT WOULD NEED TO BE SPECIFICALLY REQUESTED AT THE COMMISSION BY INDIVIDUALS IN MY MIND.
I DON'T KNOW IF THAT HELPS MARK, BUT THAT, THAT'S KIND OF WHERE I'M AT.
WELL, YOU KNOW, I, I, I HEARD IAN'S CONCERN ABOUT, UH, UH, POTENTIALLY REPORTING INFORMATION THAT IS FEDERALLY PROTECTED, AND I WOULD NEVER WANT TO SEE THAT.
AND THAT'S WHY MY REQUEST FOR A FRIENDLY AMENDMENT, UH, ACCEPTS THEIR, THEIR, YOU KNOW, RESPONSE THAT THIS COULD BE A COMMISSION RULEMAKING TYPE ISSUE.
SO I WOULD JUST THINK IT WOULD BE NEUTRAL ENOUGH TO REQUEST THAT THE BOARD ADVISED THE COMMISSION THAT THERE SHOULD BE REPORTING STANDARDS TO BE DEVELOPED BY THE COMMISSION.
SO IT'S UP TO YOU AS TO WHETHER YOU WANT TO ACCEPT THAT AS A FRIENDLY AMENDMENT OR IF YOU WANNA MOVE FORWARD WITH THE TAX MOTION AS PROPOSED.
I'D RATHER LEAVE IT AS IT IS THEN BASED ON THAT.
AND THEN IF WE WANNA ADD THAT TO A, TO AN INDIVIDUAL LEVEL.
I MEAN, I, I, I HATE TO REALLY TO THAT.
HEY, CLIFF, CAN, CAN I JUMP IN? YEAH, GO AHEAD.
WE DON'T, THIS DOESN'T HAVE TO BE FORMAL AND, AND MY POINT THERE IS, RIGHT, WE'RE NOT REQUIRED TO TAKE A VOTE ON THIS OR, OR TO APPROVE OUR CUTS RECOMMENDATION.
AND SO IT DOESN'T HAVE TO LOOK LIKE WE RECOMMEND THIS OR CERTAIN PEOPLE APPEAL IT.
WE, WE COULD HAVE SOMETHING THAT KIND OF, YOU KNOW, REFLECTS THE CONVERSATION AS YOU OUTLINED, RIGHT? WE COULD CERTAINLY SAY THE MAJORITY AGREED
[02:20:01]
WITH THE, THE TECH PRESENTATION OR, OR WHAT THE TECH RECOMMENDATION AND THEN KIND OF THIS MINORITY REFLECTED, UM, THE CONSUMER CONCERNS AND LIST THINGS LIKE TRANSPARENCY.SO I JUST WANTED TO SAY THAT WE, WE DON'T HAVE TO CAPTURE THIS IN KIND OF A FORMAL VOTING STRUCTURE.
IF THAT DOESN'T WORK THE BEST, ABSOLUTELY.
WE CAN SAY THIS IS JUST, YOU KNOW, A MAJORITY POSITION ENDORSEMENT OF TAX RECOMMENDATION AND THEN REFLECT SOME OF THE REST OF THE DISCUSSION IN OUR, OUR PRESENTATION TO RM.
WE CAN DEFINITELY DO IT THAT WAY, BY ALL MEANS, IF THAT'S THE WILL OF THE GROUP AND THAT'S THE DIRECTION YOU WANT.
IF WE, IF THE GROUP WANTS A FORMAL VOTE AND RECOMMENDATION, WE CAN GO DOWN THAT ROUTE AS WELL.
SO, UM, YEAH, WE CAN, FROM A TAC LEADERSHIP PERSPECTIVE CAN CERTAINLY CONVEY, YOU KNOW, THE GENERAL CONSENSUS AND THOUGHTS OF THE GROUP WITHOUT A FORMAL RECOMMENDATION IF THAT'S, IF THAT'S THE, UH, OPINION TO OF TAC.
AND SO, UM, I HAVE NO, NO STRONG CONCERN AND, AND REST ASSURED THAT WE MAKE SURE WE CONVEY IT, UH, IN TERMS OF THE, THE DISCUSSIONS THAT HAVE BEEN HAD OVER THE COURSE OF THE LAST TWO MEETINGS AS WELL.
SO, SO SINCE WE HAVE A MOTION ON THE TABLE, WE'LL, WE'LL CONTINUE AS IF WE'VE GOT THAT MOTION ON THE TABLE RIGHT NOW.
AND SO WE'VE GOT, UH, BOB WHITMEYER FOLLOWED BY EMILY JOLLY.
FIRST, FIRST ON THAT, I, I WOULD PREFER A VOTE IF WE THINK WE CAN GET ONE AND I THINK WE CAN GET ONE.
UM, BOB, I WAS WONDERING IF YOU WOULD ACCEPT A FRIENDLY AMENDMENT TO RECOMMEND PUBLISHING OF THE PCM AT THE END OF THE PERIOD OR WHATEVER, AND THAT I'LL VOTE FOR THIS EITHER WAY, BUT I THINK THAT MIGHT BE, I THINK THAT'S WHAT WE SAID LAST TIME.
IF IT'S EASY TO DO, I'D LIKE TO ADD IT.
KEVIN, AS THE SECONDER, WELL, MY, LEMME JUMP IN AGAIN, MY CONCERN THERE.
NOW BOB, LET ME, LET ME, LEMME MAKE SURE, UM, I'M GETTING YOU NOW.
I, I THINK THE P THE, THE INDICATIVE PCM NEEDS TO BE DONE, PERIOD, REGARDLESS OF WHAT THE SOLUTION IS.
SO ARE YOU WANTING TO MAKE THAT, I'M TRYING TO BE CLEAR.
ARE YOU, ARE YOU SAYING YOU WANNA MAKE THAT PART OF THE MOTION FOR THIS PIECE? I'M SO BOB, I I THINK YOU AND I ARE IN COMPLETE AGREEMENT.
I WOULD LIKE TO SEE THE INDICATIVE PCM DONE REGARDLESS OF WHAT WE DO.
UM, I DON'T THINK WE HAVE SAID THAT FORMALLY ANYWHERE THOUGH.
AND I KNOW ERCOT IS A LITTLE RE RESISTANT TO PUBLISHING THAT IN ANY OF THEIR STUFF.
SO I WAS TRYING TO GET THAT CAPTURED.
I THOUGHT THIS WAS A PLACE TO DO IT, BUT IF YOU HAVE AN ALTERNATIVE, HAPPY TO HEAR THAT AS WELL.
YEAH, THIS IS CHECKING AGAIN, THAT WAS GONNA BE MY POINT.
I, I THINK, I THOUGHT THE CONSENSUS THERE WAS KIND OF, WE ALL LIKE THAT, BUT THAT IS NOT MAYBE A QUOTE UNQUOTE BRIDGING SOLUTION.
AND SO I THINK WHAT CLIFF WAS TRYING TO LAY OUT EARLIER WAS WE WOULD HAVE, UM, A, A KIND OF PRESENTATION WITH THE KEY POINTS AND SO WE COULD REFLECT THE MAJORITY POSITION AND THEN THE MI MINORITY POSITION AND THEN ALSO SAY IN THE COURSE OF DISCUSSION, THIS PCM WITH SOMETHING THAT WE CAME UP WITH BUT WAS NOT NECESSARILY A BRIDGING SOLUTION.
YEAH, CAITLIN, I UNDERSTAND THE INDICATIVE PCM IS NOT A BRIDGING SOLUTION, BUT IT IS, IT DOES PROVIDE USEFUL INFORMATION.
NOW, YEAH, BOB, YOU AND I ARE ON THE SAME PAGE AND, UH, UH, AND, AND IT NOT BEING A BRIDGING SOLUTION, I'D RATHER LEAVE IT OUT OF THE MOTION UNDERSTANDING, BUT I THINK IT DOES NEED TO BE SAID THAT WE WOULD LIKE TO HAVE THAT DONE.
UH, MY CONCERN IS, UH, IT'S KIND OF TWOFOLD.
NUMBER ONE, IT ISN'T A BRIDGING SOLUTION, YOU KNOW, TO BE PART OF THE MOTION THAT SOLUTION, UH, NUMBER TWO IS I DON'T WANT ANYONE IN A DIFFERENT BUILDING TO THINK THAT WE ARE TRYING TO ACTUALLY IMPLEMENT THAT THROUGH MISUNDERSTANDING OR MISHEARING.
SO I'D LIKE TO KEEP THAT ALL KINDA SEPARATE.
OKAY, SO JUST TO, JUST TO RECAP, BOB, YOU'RE SAYING THAT, UH, YOU WANT TO CONTINUE WITH THE TAG MOTION AS IT IS AND PICK UP THE, UH, INDICATIVE PCM AS A SEPARATE ITEM OR, UH, OR WE CAN CONVEY THAT JUST IN TERMS OF OUR PRESENTATION TO OH, UH, SORRY.
YEAH, I, I WAS GONNA STICK IT JUST THE WAY IT
[02:25:01]
IS.IF WE WANNA DEAL WITH THE PCM INDICATIVE PRICING, WE CAN DO THAT DIFFERENTLY.
I REALLY BAD ABOUT NOT BEING TO WAY TO THE TRANSPARENCY IN THERE WITHOUT I, THAT'S PROBABLY, AND THAT'S WHY I'M AN ACCUSED WHENEVER WE WANNA GET BACK TO THE QUEUE.
SO I'M LEAVING MY MOTION THE WAY IT'S OKAY.
UM, SO I THINK IT'S IMPORTANT TO GO BACK TO CANON'S EARLIER COMMENT THAT THEIR, UM, ERCOT STAFF'S RECOMMENDATION ON THE, UM, R D C ENDORSEMENT INCLUDES REPORTING RIGHT IN THE AGGREGATE AND, AND PROVIDING UPDATES AND, AND LOOK BACKS AND DATA.
AND SO I THINK WITH SAC ENDORSING THAT WE DON'T NEED TO AMEND THE MOTION BECAUSE I THINK WE'RE ALL GENERALLY SUPPORTIVE OF THAT.
NOW, IF YOU'RE GONNA PROPOSE SOMETHING ELSE, WHICH IS INDIVIDUAL ARTS PARTICIPANT REPORTING, THAT'S A VERY DIFFERENT PROPOSAL.
THAT'S SOMETHING THAT WE WOULD HAVE CONCERNS WITH AND WOULD WANNA UNDERSTAND AND TALK THROUGH.
AND I THINK IAN'S COMMENT THAT THAT, YOU KNOW, A COMMISSION RULEMAKING WOULD BE AN APPROPRIATE VENUE FOR THAT.
UM, I, I AGREE WITH, UM, SO I THINK GETTING BACK TO WHAT WE'RE ASKED TO TODAY, WHICH IS LOOK AT A BRIDGING SOLUTION, UM, I THINK THE MOTION AS, UM, TYPED UP HERE IS APPROPRIATE AND WE WOULD SUPPORT MOVING FORWARD.
WE SUPPORT THE MOTION, UH, GIVEN THE ANALYSIS CONDUCTED BY ERCOT AND THE FACT THAT REALLY EVERY ONE OF THESE OPTIONS HAS AN ARBITRARY ELEMENT TO IT.
ERCOT PREFERRED, UM, CHANGE IS REALLY THE ONE THAT'S TARGETING, UH, THE, THE PROBLEMS THAT WE'RE TRYING TO ADDRESS WITH THIS CHANGE, WHICH IS A, A IMPLIED RELIABILITY REQUIREMENT OF 6,500 TO 7,000 MEGAWATTS OF RESERVES, UH, AND IS MORE SPECIFIC IN ADDRESSING THAT ISSUE ON THAT PART OF THE, OF THE CURVE AND THAT AMOUNT OF RESERVE LEVEL TRYING TO GET ADDITIONAL COMMITMENTS.
THAT'S WHY WE SUPPORT THIS OF THE, OF THE THREE.
IN TERMS OF THE REPORTING REQUIREMENT, I THINK IT WOULD BE BETTER FOR US TO BE KIND OF MORE SPECIFIC ABOUT WHAT THE REALISTIC GOALS OF THIS CHANGE ARE SO THAT WE CAN MEASURE IT.
AND I DON'T THINK IT NEEDS TO BE IN THE MOTION.
WE CAN JUST ADD THIS AS A TACK, UM, ASSIGNMENT ONCE THIS IS IMPLEMENTED, RIGHT? WE WANT THIS CHANGE, UH, BE ABLE TO MONITOR THIS CHANGE TO SEE IF IT'S RESULTING IN MORE COMMITMENT, SO WE CAN CHECK TO SEE HOW IT'S IMPACTING, UM, THE R BEHAVIOR.
AND IT'S ALSO SHOWING US HOW MUCH MORE ONLINE RESERVES WE'RE GONNA GET.
THOSE ARE EASY, EASY FOR ERCOT STAFF TO REPORT BACK ON ONCE THIS CHANGE IMPLEMENTED.
THOSE ARE THE REALISTIC GOALS FOR THIS.
ANY LIKE, HARD COMMITMENT OR SIGN IN BLOOD OF WHETHER YOU'RE GONNA BUILD A POWER PLAN OR NOT, WE'VE NEVER DONE THAT WITH ANY MARKET DESIGN CHANGE.
YOU CREATE THE INCENTIVE AND THEN YOU MONITOR, MAKE SURE THAT THE BEHAVIOR IS MATCHING THE INCENTIVES YOU CREATED.
SO I THINK WE NEED TO BE REALISTIC ABOUT WHAT REPORTING AND TRANSPARENCY WE ASK FOR HERE, MONITORING REC BEHAVIOR AND CHECKING TO MAKE SURE WE'RE GETTING MORE ONLINE RESERVES AS A RESULT OF THIS CHANGE IS, UH, I THINK WHERE WE NEED TO HEAD THAT DOESN'T NEED TO BE IN THE MOTION.
THAT CAN JUST BE AN ASSIGNMENT FOR
UM, JUST, I'M NOT SURE IF THE PCM STUFF IS IN THE MOTION OR NOT AT THIS POINT.
IT DOESN'T LOOK LIKE IT ON THE SCREEN, BUT NO, IN INDICATED PCM IS NOT IN THE MOTION AT THIS POINT.
I'LL HOLD MY COMMENT IN CASE YOU THIS.
UM, I WOULD LIKE TO VOTE JUST CLEANLY ON THIS MOTION.
UM, I THINK INDICATIVE PCM IS A FANTASTIC IDEA, UM, PENDING WHAT THE LEDGE, UH, DECIDES ON PCM.
UM, AND I THINK, UM, IT'S, UH, RESPECTFUL OF US TO HOLD OFF AND GIVE THEM THAT TIME.
UM, AS FOR THE REPORTING STANDARDS THAT, UM, MARK HAS SUGGESTED, UM, I AGAIN THINK THIS IS SOMETHING THAT NEEDS TO BE TRULY THOUGHT OUT, AND I THINK A RULEMAKING, UM, IF THE COMMISSION WANTED TO TAKE IT UP IS, UM, A BETTER PLACE TO FULLY THINK THROUGH THIS ISSUE, UM, RATHER THAN, UH, A TACK BOAT THAT, UM, UH, YOU KNOW, BORDERLINE TELLS RM C WHAT TO DO.
UM, BECAUSE IF, IF I REMEMBER CORRECTLY IN CLIFF, PLEASE CORRECT ME IF I'M WRONG, UM, THE COMMISSION ASKED THE ERCOT BOARD WHAT THEIR RECOMMENDATION WAS.
UM, THE BOARD THEN TURNED US, US, WE WOULD LIKE TO HELP THEM
[02:30:01]
INFLUENCE THEIR DECISION.UM, SO I THINK IT IS RESPECTFUL FOR US TO KIND OF LIMIT OUR, OUR, OUR RECOMMENDATION OR OR REQUEST TO THEM.
AND JUST TO CONFIRM YOUR RECOLLECTION IS CORRECT THAT THIS WAS DELEGATED TO THE ERCOT BOARD.
ERCOT BOARD HAS SINCE ASKED US FOR OUR OPINION ON IT.
SO THIS GIVES US THE OPPORTUNITY TO WEIGH IN IN THAT REGARD.
SO, ALL RIGHT, MARK, UH, THANKS, CLIFF.
I, I AM GOING TO HAVE TO VOTE AGAINST THE MOTION, BUT I DO WANNA SAY THAT I APPRECIATE THE COMMENTS OF KAAN AND EMILY AND BILL AND IAN ON REPORTING AND, AND, UH, CONAN'S, UH, COMMENT TO THE BOARD ON REPORTING.
AND I LOOK, ESPECIALLY LIKE BILL'S POINT ABOUT TAKING ON A ATTACK ASSIGNMENT FOR MONITORING.
SO I, I LOOK FORWARD TO THAT EFFORT AND I HOPE THAT WE HAVE SOME ACTIVITY AT THE COMMISSION AS WELL.
YOU KNOW, I, I WOULD LIKE TO CONSIDER OR ATTACK LEADERSHIP TO CONSIDER REPORTING TO R AND M.
UM, THE THOUGHT AROUND, WE'RE NOW PUTTING 500 MILLION BEHIND THE 6,500 MEGAWATT RESERVE LEVEL, AND WHETHER WE COULD GET A WORKSHOP OR SOME DISCUSSION FROM ERCOT CONFIRMING THAT THAT IS THE RIGHT NUMBER, IT'S GONNA CONTINUE TO BE THE RIGHT NUMBER FOR UNTOLD NUMBER OF YEARS, THIS BRIDGING SOLUTION'S GONNA BE IN PLACE, UM, BECAUSE NOW THERE'S GONNA BE A LOT OF MONEY AROUND IT, AND I WOULD LIKE TO SEE SOME MORE, UM, INFORMATION FROM ERCOT ON THE 6,500 MEGAWATT LEVEL.
UM, I MEAN, I'M, UH, I I THINK WE NEED TO FOLLOW UP WITH ALL INTERESTED STAKEHOLDERS ON, ON ALL THE ISSUES.
I'M A LITTLE, UH, SO, SO I, I THINK THAT COMMITMENT WE CAN MAKE, I DO THINK THAT IT'S NOT PROBABLY SPOT ON TO TALK ABOUT THIS AS $500 MILLION WHEN ON A BACKCAST BASIS.
THAT'S WHAT WE'RE SEEING WITH NO BEHAVIORAL CHANGES AND NO CHANGES TO THE RESOURCE MIX.
BUT I STILL TAKE YOUR POINT, UH, MAIN POINT THAT YOU'RE MAKING, WHICH IS WE SHOULD NOT JUST, UH, STOP LOOKING AT THIS.
SO I'M HAPPY TO ENGAGE, UH, IN ANY FORUM THAT STAKEHOLDERS WOULD LIKE.
YEAH, AND I, I THINK WE WILL TAKE YOU UP ON THAT CANON, I THINK, AND I THINK THAT'S THE MESSAGE THAT WILL CARRY TO THE BOARD AS WELL, THAT THIS IS SOMETHING THAT'S OF INTEREST TO MARKET PARTICIPANTS THAT WAS KEENLY MADE VERY APPARENT TODAY IN THAT REGARD.
AND SO WE DO WANT TO GO AHEAD AND CONTINUE TO LOOK AT THIS.
AND I THINK TO THE POINT OF ONE OF OUR GOALS, AND I THINK IT WAS MARK THAT WAS THE ONE THAT RAISED IT, YOU KNOW, WE WANT TO CONTINUOUSLY LOOK AT THE THINGS THAT HAVE BEEN PUT INTO PLACE TO MAKE SURE THAT THEY'VE BEEN EFFECTIVE IN THAT REGARD.
AND SO I THINK THIS MIGHT BE AN OPPORTUNITY OR AN AREA WHERE WE PROBABLY WANNA LOOK AT THIS MORE FREQUENTLY.
UM, SO YES, WE WILL, WE WILL DEFINITELY CARRY THAT MESSAGE TO R AND M AND, AND MAKE SURE THAT R AND M'S AWARE THAT THIS IS OF, OF HIGH INTEREST TO US AND SOMETHING THAT WE'RE GONNA WANT TO SEE REGULAR REPORTING OF.
AND, AND I THINK THE MESSAGE I'VE HEARD FROM ERCOT TODAY IS THAT THEY WILL CONTINUE TO LOOK AT THAT AND BRING US INFORMATION, UH, FROM TIME TO TIME.
SO IF I MISSPOKE ON THAT KON, JUST LET ME KNOW.
NO, NO, YOU'RE, YOU'RE SPOT ON.
AND IN FACT, UH, I MEAN, I WORRY ON BOTH SIDES OF THIS THAT, UH, IT COULD UNDER OR OVERPERFORM AND WE WOULD NEED TO MAKE, UM, UH, ADJUSTMENTS.
SO THAT, THAT'S KIND OF MY EXPECTATION.
AND I THINK CARRIE'S GONNA BE EXTREME.
THE IMM CARRIE IS GONNA BE VERY INSTRUMENTAL IN ULTIMATELY TRYING TO GET THESE THINGS, UH, BETTER ALIGNED WITH GOOD MARKET DESIGN.
ANY OTHER COMMENTS OR QUESTIONS ON THE MOTION BEFORE WE MOVE FORWARD? ALL RIGHT.
COREY, ARE YOU READY? YES, SIR.
WE'LL START OFF WITH THE CONSUMER SEGMENT WITH MARK.
[02:35:01]
NO, NO.THANK YOU ERIC FOR CHRISTIAN STEIN.
CLIFF? YES, THANK YOU ON OUR INDEPENDENT GENERATORS.
UNDER OUR IPMS, JEREMY? YES, THANK YOU, REMI.
CHRIS HENDRICKS, ARE YOU WITH US? LET'S SEE, HOW ABOUT JENNIFER ABSTAIN? THANK YOU.
MOTION CARRIES SIX OPPOSED TO OBJECTIONS.
ALL RIGHT, THANK YOU VERY MUCH, COREY.
SO, OKAY, SO JUST WANTED TO CIRCLE BACK AND SEE IF THERE'S ANYTHING ELSE THAT WANTED TO TAKE UP.
OUR INTENTION AGAIN, IS TO GO AHEAD AND, UM, PRESENT THE MAJORITY OPINION, MAKE SURE WE PROVIDE THE MINORITY OPINION AS WELL ON THIS PARTICULAR ISSUE.
UM, ERIC, I THINK YOU'VE PROVIDED SOME GOOD, GOOD MATERIAL FOR US TO WORK WITH IN DEVELOPING THAT, IN THAT REGARD.
AND SO, UH, WE WILL GO AHEAD AND HAVE A DISCUSSION ON THE REPORTING DISCUSSION THAT WE HAD HERE, UM, AS WELL AS, UM, YOU KNOW, THE THOUGHTS ON THE INDICATIVE PCM, WHICH SEEM TO HAVE A PRETTY GOOD COALESCENCE AROUND IT IN THAT REGARD.
SO IF THERE'S NO OBJECTIONS TO THAT PLAN, THEN WE WILL MOVE FORWARD IN GETTING THAT PRESENTATION PUT TOGETHER AND GET THAT PUT IN FRONT OF RELIABILITY AND MARKETS NEXT WEEK.
ERIC, SO, UH, SINCE YOU PART OF THE PCM AGAIN, UM, I, UH, I GUESS I DO HAVE A COMMENT ON THAT.
I THINK THERE'S GENERAL CONSENSUS, YOU KNOW, THAT THERE'D BE VALUE IN THAT TO THE EXTENT THAT THE LEGISLATURE COMMISSION DECIDES TO DO A PCM.
UM, BUT THE DETAILS MATTER A LOT.
AND, UM, SO T'S INITIAL, UM, PRESENTATION OF THAT SAID THEY WOULD DO IT BASED ON THE E THREE REPORT.
AND I GUESS JUST STARTING QUESTION, IS THAT, WOULD THAT STILL BE YOUR PLAN, UH, ERCOT OR DO YOU HAVE SOME OTHER, UH, IF VIEW IN MIND, SO LIKE FOR, FOR EXAMPLE, UM, HOW WILL YOU DETERMINE THE DEMAND CURVE GIVEN THAT THERE SEEMS TO BE A VARIETY OF OPINIONS ON THE COMMISSION ABOUT HOW TO DO THAT? OTHER QUESTIONS AS WELL, BUT THAT'S JUST I THINK A, A GOOD INDICATOR OF, OF THE CHALLENGE HERE AND, AND HOW YOU NEED, I THINK, SOME PARAMETERS LAID OUT IN ORDER TO DO THAT INDICATIVE TC, UH, YEAH, CANON, GO AHEAD.
UH, I DO THINK IT'S EXTREMELY CHALLENGING.
SO AGREE WITH ALL THE CHALLENGES IN THE E THREE REPORT.
THEY USED THE ONE EVENT IN 10 YEAR STANDARD.
UM, THAT MIGHT BE A GOOD STARTING POINT THAT WE CAN DO SENSITIVITIES AROUND MAYBE, UM, BUT WE CAN TALK ABOUT THAT, UM, IN GREATER DETAIL.
UM, YOU WHEN, WHEN THAT ISSUE ARISES.
BUT YOU'RE A HUNDRED PERCENT CORRECT THAT THE DETAILS MATTER.
UM, AND UH, I THINK WE WOULD WANNA CONSIDER EVERYBODY'S THOUGHTS ON THAT BEFORE WE WERE TO DO ANYTHING.
AND I THINK THE WAY THAT WE'LL FRAME IT UP, ERIC, IS THAT, YOU KNOW, WE, WE FIND VALUE IN IT AND, BUT IT WOULD
[02:40:01]
HAVE TO BE IN CONJUNCTION WITH THE PARAMETERS AS DEFINED BY, BY THE COMMISSION AND, AND DEFINED ON THE INPUT THAT WE PROVIDE OR THAT WE RECEIVED FROM THEM, RATHER.JOHN CLIFF, I WAS JUST HOPING FOR SOME MORE CLARITY ABOUT HOW Y'ALL ARE PLANNING TO PRESENT BOTH, UH, I, I GUESS THE MINORITY OPINION TO ERCOT OR TO THE BOARD.
YEAH, SO I, I THINK THE WAY THAT WE WOULD PLAN TO PRESENT THAT IS USING THE, UM, DOCUMENT THAT ERIC SENT OUT AS KIND OF OUR TEMPLATE THERE, INDICATING THAT THERE WERE CONCERNS EXPRESSED ABOUT THE RDC, UM, INDICATE THAT THERE WERE, UH, OR IS SUPPORT FOR USING D R R S AS AN ALTERNATIVE TO THE RDC MODIFICATIONS.
UM, AND AND IN ESSENCE USE THAT AS, AS KIND OF THE TEMPLATE, WHICH WOULD, UM, I THINK PARLAY INTO THE DISCUSSIONS IN TERMS OF THE ADDITIONAL REPORTING AND SO FORTH.
DOES THAT HELP JOHN? YEAH, YEAH, THAT HELPS.
UM, I, I GUESS I WAS CURIOUS, WOULD TAC BE OPEN TO HAVING A CONSUMER REPRESENTATIVE SPEAK ABOUT THE MINORITY OPINION SINCE WE'RE GENERALLY ALIGNED? WOULD WHAT? WELL, WHAT DO YOU MEAN BY GENERALLY ALIGNED JOHN? SINCE THE MAJOR SINCE, SORRY, THE MINORITY OPINION SINCE THE MINORITY IS GENERALLY ALIGNED.
SO, UM, I'M GONNA, I'M GONNA DEFER TO KENAN OR ANN ON THAT AS FAR AS THAT'S CONCERNED.
SO I THINK WE CAN DO A PRETTY GOOD JOB OF CONVEYING THAT INFORMATION, BUT I WANNA MAKE SURE THAT, UM, THEY'VE HAD MORE OF THE DISCUSSIONS WITH THE CHAIR THAN, THAN HEAD OF WE.
SO, UM, KENAN, DO YOU, YOU IN A POSITION TO, TO TALK ABOUT THAT OR? NOPE.
UH, I'M, I'M PROBABLY THE BEST PERSON AVAILABLE TO TALK ON THIS, SO, UM, I THINK WE ASSIGNED AROUND, UH, 20 MINUTES, UH, FOR KINDA YOU, UH, AND, UH, UH, POTENTIALLY TWO VIEWPOINTS.
SO I WOULD SAY, UM, THAT THAT'S, THAT'S FEASIBLE WITHIN THE TIME THAT WE ALLOTTED.
UM, AND SO, SO I DON'T HAVE AN ISSUE WITH IT.
UM, YOU WOULD JUST NEED TO RATION YOUR TIME, UH, YOU KNOW, AND, AND AGREED UPON WAY TO FIT WITHIN THAT 20 MINUTES.
AND DID YOU HAVE ANYTHING TO ADD? I DON'T KAAN, BUT I, I DO KNOW THAT I THINK THEY'VE ALREADY, UM, YOU KNOW, DISCUSSED THAT THERE WERE OTHER SPEAKERS BESIDES THE TECH LEADERSHIP THAT WANTED TO SPEAK.
UM, I THINK THERE IF SOME TIME ALLOTTED AS KAAN HAD STATED.
SO I THINK WE'RE OPEN TO HAVING THAT ALTERNATE PRESENTATION, JOHN, IN THAT REGARD.
UM, I KNOW WHERE I'VE BEEN A LITTLE BIT CONCERNED IS THAT THIS LOOKS LIKE A, AN APPEAL OF ATTACK ACTION IN WHICH IS A WHOLE NOTHER PROCESS OR WHATEVER.
SO I THINK IF, IF YOU WANTED TO SPEAK TO, UM, YOU KNOW, THE MINORITY OPINION, I MEAN, I THINK WE CAN CERTAINLY SET THAT UP AND, AND MAKE THAT HAPPEN IN THAT REGARD.
BUT, YOU KNOW, I THINK WE WANNA BE MINDFUL THAT WE DON'T WANT THIS TO NECESSARILY LOOK LIKE A ATTACK APPEAL BECAUSE IF, IF WE DID THEN WE SHOULD HAVE BEEN FOLLOWING A DIFFERENT PROCESS IN THAT REGARD.
UH, BOB HILTON, WELL ACTUALLY I WAS GONNA KIND OF TALK A LITTLE BIT ABOUT WHAT JOHN BROUGHT UP, BUT, UH, I'LL LET Y'ALL MAKE THAT DECISION.
YEAH, BE HAPPY TO HEAR WHAT YOU HAVE TO SAY, BOB.
WELL, I WAS JUST, THE ONLY THING I WAS GONNA SAY AND, AND WE'RE GONNA HAVE THIS GOING FORWARD, UH, YOU KNOW, THE RM I KNOW AND YOU KNOW, THEY'VE INDICATED TO BOTH YOU AND I AND AND CAITLIN THAT THEY DO WANNA HEAR FROM OTHERS.
UH, BUT YOU'RE RIGHT, WE NEED TO MAKE SURE THAT, THAT THIS ISN'T AN APPEAL AND THAT IF SOMEONE FROM THE CONSUMER PERSPECTIVE WANTS TO, TO RELAY THEIR CONCERNS OR THINGS THEY WOULD LIKE TO SEE, I THINK THAT'S FINE, BUT WE CAN'T HAVE IT LIKE AN APPEAL OTHERWISE YOU'RE RIGHT, WE SHOULD HAVE BEEN IN A DIFFERENT PROCESS, SO THAT WOULD'VE TO BE MADE VERY CLEAR.
AND I THINK WE COULD FRAME IT UP THAT WAY.
SO, UM, SO I GUESS THE QUESTION IS, IS, IS THERE, IS THERE A STRONG OPINION FROM ANYONE ON THAT WOULD BE WANTING TO SPEAK TO THIS IN PARTICULAR, ERIC?
[02:45:02]
UH, YEAH, SO, YOU KNOW, WE'D BE HAPPY TO HAVE A CONSUMER, UH, VOICE THERE OBVIOUSLY, UH, AS CONSUMERS, UM, AND, UM, YOU KNOW, HAPPY TO WORK WITH, UM, TECH LEADERSHIP AND ARCHIVE ON MAKING IT, YOU KNOW, LOOK NOT LIKE AN APPEAL, BUT EXPLAINING THE PERSPECTIVE.I PUT A COMMENT IN THE CHAT ABOUT, YOU KNOW, YOU KNOW, SOME OF THE ITEMS THAT AS YOU SUMMARIZED OUR PERSPECTIVE, YOU MISSED.
NOT TO SAY THAT IT WAS INTENTIONAL BY ANY MEANS, BUT JUST LIKE WE, WE ARE VERY FAMILIAR WITH OUR PERSPECTIVE AND WOULD BE ABLE TO SPEAK TO IT.
UM, SO THE, UM, YOU KNOW, IN OUR PREFERENCE OF AVOIDING A A FLOOR IS AN IMPORTANT PART OF OUR COMMENTS, UM, THAT WE WOULD LIKE TO MAKE SURE THAT THE BOARD HEARS.
SO I KNOW THIS IS A LITTLE BIT UNCHARTED TERRITORY IN THAT REGARD.
UM, AND, AND BEING THAT THIS IS A, YOU KNOW, AN OPPORTUNITY PRESENTED TO US THAT DOES NOT GO THROUGH THE NORMAL PROCESS OF PROVIDING A RECOMMENDATION TO THE BOARD I E A REVISION REQUEST OR SOMETHING LIKE THAT, I THINK WE'VE GOT SOME LATITUDE HERE TO MAYBE APPROACH THIS A LITTLE BIT DIFFERENTLY THAN WE'VE DONE IN THE PAST.
SO, UM, WE'LL WE CAN WORK WITH YOU, ERIC, TO, TO SEE IF WE CAN MAKE THAT WORK OUT, BUT I'M HELPING YEAH, I THINK THERE'S A WAY OF DOING THAT THAT'S REALLY, UH, I THINK PRETTY, PRETTY EASY.
THE, THE BOARD OF THE RM HAS ALWAYS ASKED THAT WE EXPLAIN NO VOTES, AND AS YOU INTRODUCE THAT, YOU COULD SAY, UH, YOU KNOW, COME UP AND YOU SAY, WELL, THE CONSUMER SEGMENT GROUP VOTED NO ON THIS.
AND SO WE'VE BROUGHT THEM IN TO EXPLAIN WHY THEY VOTED NO.
AND THAT WAY YOU SET IT UP TO JUST AN EXPLANATION.
IT'S NOT AN APPEAL, IT'S JUST MY THOUGHT.
I WAS STARTING TO HEAD THAT DIRECTION, SO YOU, YOU GOT THERE, SO, OKAY.
AND I THINK THAT'S PROBABLY A GOOD WAY TO APPROACH THIS.
SO, ALRIGHT, ERIC, THAT, THAT SOUNDS GOOD.
WE'LL WORK WITH YOU ON, ON MAKING SURE WE CAPTURE THAT IN THE SLIDE DECK AND, AND MAKE SURE THAT WE GET THAT, UH, MINORITY POSITION PRESENTED HERE.
ANY OTHER COMMENTS OR QUESTIONS? OKAY, LOOKS LIKE THE QUEUE IS EMPTY.
WELL TACK, I APPRECIATE ALL THE WORK IN TRYING TO GET THIS SQUARED AWAY.
UM, I KNOW THIS HAS BEEN A PRETTY ARDUOUS SET OF MEETINGS IN THAT REGARD, SO, UH, WE'RE GONNA WORK FEVEROUSLY TOWARDS GETTING THAT SLIDE DECK PULLED TOGETHER.
I BELIEVE OUR, UH, DEADLINE FOR GETTING THAT PULLED TOGETHER IS TODAY, SO WE'RE GONNA WORK ON THAT THIS AFTERNOON.
AND, UH, THAT BEING SAID, NOTHING ELSE ON, ON OUR AGENDA.
[4. Other Business]
FOR OTHER BUSINESS THAT ANYONE WANTS TO RAISE RIGHT NOW.CLIFF, I JUST WANNA SAY THANK YOU TO EVERYBODY.
THIS WASN'T EASY ON, ON ANYONE GIVEN THE TIME, UH, CONSTRAINTS.
SO JUST WANTED TO SAY A GENERAL THANKS.
UM, I THOUGHT, UH, THE FEEDBACK THAT WE RECEIVED WAS REALLY, REALLY VALUABLE.
YEAH, AND KAHAN, I APPRECIATE THAT AND I WANT TO ECHO THAT AS WELL CAUSE I KNOW, UH, YOU KNOW, DAVE AND HIS FOLKS AND YOU AND HOW MANY AT ERCOT DID A REALLY GOOD JOB OF PULLING TOGETHER SOME INFORMATION FOR US TO LOOK AT AND, UM, I THINK IT WAS, I THINK IT WAS VERY HELPFUL IN TERMS OF MAKING SURE THAT WE CAME TO A CONCLUSION THAT WE FEEL, UM, LARGELY COMFORTABLE WITH IN THAT REGARD.
SO, UM, THE MORE DATA WE CAN HAVE, SOMETIMES THE BETTER IN THAT REGARD.
AND I THINK THAT WAS, THAT WAS VERY HELPFUL IN THIS PARTICULAR SITUATION.
SO LIKEWISE, WE APPRECIATE ALL THE HELP, UH, FROM OUR OUT AS WELL AND, AND FROM ALL THE STAKEHOLDERS THAT THAT TOOK TIME TO, TO REALLY REVIEW THIS PARTICULAR ITEM.
SO SEEING NOTHING ELSE UNDER OTHER BUSINESS.
UM, OUR NEXT MEETING IS APRIL 25TH, SO A LITTLE OVER TWO WEEKS FROM NOW.
UM, AND BEYOND THAT WE WILL CLOSE OUT THIS TECH MEETING AND, UH, Y'ALL HAVE A GREAT DAY.