Market Information System Grid and Market Conditions

News Release

June 27, 2008

ERCOT Completes Test Run of Nodal Real-Time Market

Electric Reliability Council of Texas, grid operator for most of the state, successfully completed a live run of the nodal real-time market Wednesday. 

During the system-wide test, ERCOT system operations managed the power grid with the nodal real-time systems that will be in place when the nodal market is launched, anticipated in 2009. 

At 11 a.m. Wednesday, ERCOT began moving the energy schedulers to nodal operation one at a time in order to maintain frequency and power flows at the desired output.  All energy schedulers were transitioned to nodal control by 12:18 p.m., and the ERCOT market was entirely under nodal system control for 29 minutes.  

“This was a key milestone because it demonstrated ERCOT’s ability to run a real-time nodal market,” CIO and Nodal Executive Sponsor Ron Hinsley said.  “The test not only validated the ERCOT systems, but it also confirmed that market participants have the systems in place for nodal real-time operation and that our systems can work in a coordinated effort. This involved a huge amount of coordination between ERCOT and the 55 energy schedulers in the test, and everyone performed brilliantly.” 

Since January, market participants that own generation in ERCOT have completed a series of tests designed to ensure that each participant has the proper controls in place for nodal operation.  

“ERCOT appreciates the commitment from all market participants that enabled the achievement of this milestone event,” Hinsley said.  “There is still much to do to prepare for nodal, including completion of the day-ahead market and implementation of a dynamic network modeling system, but this test was significant as it demonstrates that the entire ERCOT region is moving in the right direction as we get ready for nodal,” added Hinsley. 


In September 2003, the Public Utility Commission of Texas (PUC) ordered ERCOT stakeholders to develop a nodal wholesale market design. In April 2006, the PUC signed the order approving the nodal protocols.  A PUC order established a go-live date by January 1, 2009. The ERCOT Board of Directors announced in May that the schedule is being reviewed due to delayed delivery and testing of a critical software application.  ERCOT is working closely with the PUC, market participants and vendors to develop a new schedule and will communicate any schedule changes after confirmation that the delayed application is delivered and working. 

The Texas Nodal project exists to facilitate the transition from a zonal to a nodal market and affects many of ERCOT’s and market participant’s business processes and systems. In the nodal market, ERCOT will consist of more than 4,000 nodes which will replace the ERCOT region’s current four congestion management zones. 

The primary components of the nodal market include a day-ahead market, reliability unit commitment, real-time or security constrained economic dispatch, and congestion revenue rights.  

The nodal market is expected to deliver improved price signals, improved dispatch efficiencies and direct assignment of local congestion. 

In the nodal market, ERCOT will run the security constrained economic dispatch every five minutes using offers by individual resources and actual shift factors by each resource on each transmission element. The distinction between zonal and local congestion disappears as all congestion becomes local.

The Electric Reliability Council of Texas (ERCOT) manages the flow of electric power to more than 26 million Texas customers -- representing about 90 percent of the state’s electric load. As the independent system operator for the region, ERCOT schedules power on an electric grid that connects more than 46,500 miles of transmission lines and 710+ generation units. It also performs financial settlement for the competitive wholesale bulk-power market and administers retail switching for nearly 8 million premises in competitive choice areas.

ERCOT is a membership-based 501(c)(4) nonprofit corporation, governed by a board of directors and subject to oversight by the Public Utility Commission of Texas and the Texas Legislature. Its members include consumers, cooperatives, generators, power marketers, retail electric providers, investor-owned electric utilities, transmission and distribution providers and municipally owned electric utilities.