Specifications in Wholesale Electricity Market (“MME”)
On June 1, 2019, Directing Board’s Order OSINERGMIN No. 090-2019-OS/CD (“Order”) was published on the Official Gazette “El Peruano”. Main aspects of this Order are presented below as follows:
1. Order, Section 1: Amendments to the Technical Procedure No. 10 “” (“PR 10”) “Assessment of Active Power Transfer Valuation and Ancillary Services and Operating Inflexibilities Valuation” of the Economic Operation Committee of the National Interconnected System (COES) are approved:
– PR 10, Items 6.2.1 and 6.2.2: It is specified that the information given by the MEE Participants with respect to Contracted Power and Total Contracted Power is an Affidavit.
– PR 10, Item 6.3: It is specified that it is the obligation of the Agents, if applicable, and not only of the Transmitters, to address the Basic Information to COES.
– PR 10, Item 7.2: The possibility that the Generators can be entitled to the Generating Units that are not of their property is eliminated.
– PR 10, Items 7.5 and 7.9: It is set forth that Withdrawals from Distributors and Main Users will correspond to the difference between their Power consumption and consumption covered by their supply contracts. In this sense, Participants (Supplier and client) may declare that a consumption value or percentage of the Participant—Distributor and/or Main User—corresponds to Withdrawals from the MME by the latter, who will have to declare their daily Withdrawals from the MME.
– PR 10, Item 7.6: Provisional allocation of Not Declared Withdrawals is eliminated as these will be invoiced to Distributors and Free Users incurred in them.
– PR 10, Item 7.14: The determining of Generators Withdrawals considering consumption excess is eliminated as the Distributors and Free Users that do not participate in the Short-Term Model (“MCP”) must respect the limits of power contracted with their suppliers.
– PR 10, Item 8.2.1: Time to address the Contracted Power is changed so the most accuracy information shall be addressed up to 16:00 hours from the day before to the consumption day.
2. Order, Section 2: The Glossary of Abbreviations and Definitions Used in the Technical Procedures of COES is amended.
– “Transfer Bus”: Its definition is adjusted in order to widen the existing criteria in case of Withdrawal that included only the Reference Generator Bus determined by the Supervisory Body of Investment in Energy and Mining (OSINERGMIN).
– “Coincident Demand”: Consumptions of Not Declared Withdrawals allocated to be used in Power Transfer Valuation and Compensations of the Transmission Main System (SPT) and Transmission Guaranteed System (SGT) are included.
– “Contracted Power” and “Total Contracted Power”: It is established that these correspond to the power that Generators and Distributors are committed to supply to Users (no considering the agreed occasional excess).
– “Withdrawal”: It refers to the active power from the Generators, Participants, Distributors and Participant Main User.
– “Not Declared Withdrawal”: It corresponds only to a consumption in the not-covered MCP.
3. Order, Section 3: It is established the Incentive Factor being referred to the Wholesale Electricity Market Regulation, Item 9.3.
Such factor will be applied to the Short-Term Marginal Cost (“CMg”) in order to invoice the Not Declared Withdrawals allocated to the Generators according to the ratio factor to the companies—Distributors and Free Users—in order to disincentivize this kind of withdrawals. Said factor will be reviewed each two (2) years by OSINERGMIN.
First review will be carried out in November 2021 for which review requests shall be filed with up to September 2021.
Finally, it should be mentioned that provisions of the Order came into force the next day of their publication in the Official Gazette “El Peruano”.
For further details, please contact Verónica Sattler (vsattler@estudiorodrigo.com), Alejandro Manayalle (amanayalle@estudiorodrigo.com) and/or Eduardo Ramos (eramos@estudiorodrigo.com).
