FERC Filings

COMMENTS OF THE ELECTRIC POWER SUPPLY ASSOCIATION ON THE MEDIATION REPORT FOR THE SOUTHEAST RTO

Congestion Management (Function 2):

EPSA believes that the CGM’s proposed locational marginal pricing/financial congestion hedge (“LMP/FCH”) congestion management model is far superior to the SeTrans physical rights model because the LMP/FCH model allows for economic efficiency, liquidity, flexibility and certainty of pricing and delivery. The CGM’s financial congestion management model also permits congestion “buy-through.”
EPSA believes that a robust spot market will emerge if there are no day-ahead balanced schedule requirements and associated penalties. The CGM proposal (without the balanced scheduled resource requirements), using the financial congestion management model, will provide market transparency with visible real-time pricing upon which to base an active market in providing hedging tools with a wide variety of energy products and services.
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Certain aspects of the financial rights model have been demonstrated in other markets to be effective. In addition,

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the LMP/FCH model would result in less parallel path flow problems and resulting TLRs, when compared to the SeTrans physical rights model.

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