Texas Administrative Code › Title 16 - ECONOMIC REGULATION › Part 2 - PUBLIC UTILITY COMMISSION OF TEXAS › Chapter 25 - SUBSTANTIVE RULES APPLICABLE TO ELECTRIC SERVICE PROVIDERS › Subchapter O - UNBUNDLING AND MARKET POWER › Division 3 - CAPACITY AUCTION › Section 25.381 - Capacity Auctions

Current through Reg. 49, No. 28; July 12, 2024
(a) Applicability.
					 This section applies to all affiliated power generation companies (PGCs) as
					 defined in this section in Texas. This section does not apply to electric
					 utilities subject to the Public Utility Regulatory Act (PURA) §39.102(c)
					 until the end of the utility's rate freeze. It is recognized that certain
					 commission orders issued during 2001 have effectively delayed competition in
					 the service territories of Southwestern Electric Power Company (SWEPCO) and
					 Entergy Gulf States, Inc. (EGSI). This section shall apply to auctions
					 conducted after 2001 by SWEPCO and/or EGSI only when competition is implemented
					 in their respective service territories.
(b) Purpose. The purpose of this section is
					 to promote competitiveness in the wholesale market through increased
					 availability of generation and increased liquidity by requiring electric
					 utilities and their affiliated PGCs to sell at auction entitlements to at least
					 15% of the affiliated PGC's Texas jurisdictional installed generation capacity,
					 describing the form of products required to be auctioned, prescribing the
					 auction process, and prescribing a true- up procedure, in accordance with PURA
					 §39.262(d)(2).
(c)
					 Definitions. The following words and terms, when used in this section, shall
					 have the following meanings, unless the context indicates otherwise:
(1) Affiliated power generation company
					 (PGC)--Any affiliated power generation company that is unbundled from the
					 electric utility in accordance with PURA §39.051.
(2) Assigned units--The PGC-specific
					 generating units that form the block of capacity from which an entitlement is
					 sold.
(3) Auction start date--The
					 date on which an auction begins.
(4) Business day--Any day on which the
					 affiliated PGC's corporate offices are open for business and that is not a
					 banking holiday.
(5) Capacity
					 auction product--One of the following: "baseload", "gas-intermediate",
					 "gas-cyclic", or "gas-peaking". Each capacity auction product is further
					 described in subsections (f) and (g) of this section.
(6) Close of business--5:00 p.m., central
					 prevailing time.
(7) Congestion
					 zone--An area of the transmission network that is bounded by commercially
					 significant transmission constraints or otherwise identified as a zone that is
					 subject to transmission constraints, as defined by an independent
					 organization.
(8) Credit rating--A
					 credit rating on an entity's senior unsecured debt, the entity's corporate
					 credit rating, or the entity's issuer rating.
(9) Daily gas price--The index posting for
					 the date of flow in the Financial Times energy publication "Gas Daily" under
					 the heading "Daily Price Survey" for East-Houston- Katy, Houston Ship Channel.
					 For EGSI gas entitlements in the eastern congestion zone, the daily gas price
					 will utilize the "Gas Daily" index posting for Henry Hub. For EGSI gas
					 entitlements in the western congestion zone, the daily gas price will be an
					 average of the "Gas Daily" index posting for East-Houston-Katy, Houston Ship
					 Channel.
(10) Day-ahead--The day
					 preceding the operating day.
(11)
					 Entitlement or capacity entitlement--The right to purchase and receive, under
					 the applicable capacity auction master agreement, a block of 25 megawatts (MW)
					 of electrical capacity and energy from the assigned units for a specific
					 capacity auction product for one calendar month.
(12) Forced outage--An unplanned component
					 failure or other condition that requires the unit be removed from service
					 before the end of the next weekend.
(13) Holder--A person or entity that has
					 acquired ownership of an entitlement under the terms of the applicable capacity
					 auction Master Agreement.
(14)
					 Installed generation capacity--All potentially marketable electric generation
					 capacity owned by an affiliated PGC, including the capacity of:
(A) Generating facilities that are connected
					 with a transmission or distribution system;
(B) Generating facilities used to generate
					 electricity for consumption by the person owning or controlling the facility;
					 and
(C) Generating facilities that
					 will be connected with a transmission or distribution system and operating
					 within 12 months.
(15)
					 Master Agreement or Agreement--The applicable Capacity Auction EEI/NEMA Master
					 Power Purchase & Sale Agreement.
(16) Starts--Direction by the holder of an
					 entitlement to dispatch a previously idle entitlement.
(17) Texas jurisdictional installed
					 generation capacity--The amount of an affiliated PGC's installed generation
					 capacity properly allocable to the Texas jurisdiction. Such allocation shall be
					 calculated pursuant to an existing commission-approved allocation study, or
					 other such commission-approved methodology, and may be adjusted as approved by
					 the commission to reflect the effects of divestiture or the installation of new
					 generation facilities.