Credit; Legal Notifications

Thu, Apr 30, 2020 04:41 PM

M-A043020-01 Resolution of ADR Proceedings between ERCOT and Peak Energy Capital LP (2020-PEC-01)


NOTICE DATE: April 30, 2020

NOTICE TYPE: M-A043020-01 Legal

SHORT DESCRIPTION: Resolution of ADR Proceedings between ERCOT and Peak Energy Capital LP (2020-PEC-01)

INTENDED AUDIENCE: ERCOT Market Participants

DAYS AFFECTED: September 16 to 23, 2019

LONG DESCRIPTION: Peak Energy Capital LP (Peak Energy) filed an Alternative Dispute Resolution (ADR) request with ERCOT on February 12, 2020.  In its ADR request, Peak Energy asserts that it was charged for Point-to-Point (PTP) Obligations at prices that were above the “Not-to-Exceed” (NTE) bid prices submitted by Peak Energy for Operating Days (ODs) September 16 to 23, 2019, after ERCOT issued Day-Ahead Market (DAM) Resettlement Statements for those ODs.  ERCOT issued Resettlement Statements due to a DAM price correction approved by the ERCOT Board of Directors on December 10, 2019.  Peak Energy asserts that by charging it for PTP Obligations in excess of its bid prices, ERCOT violated ERCOT Protocol Section 4.5.1(13), which provides that "PTP Obligation bids shall not be awarded where the DAM clearing price for the PTP Obligation is greater than the PTP Obligation bid price plus $0.01/MW per hour.”  In its ADR request, Peak Energy seeks compensation totaling $27,437.80.

Pursuant to ERCOT Protocol Section 20.5(4), the party that filed the ADR request must work with ERCOT to schedule an initial ADR meeting within 75 days after the ADR request is filed, unless the parties agree to an extension of time to hold the initial ADR meeting.  In this case, ERCOT Protocol Section 20.5(4) required that the initial ADR meeting be held on or before April 27, 2020.  During March and April 2020, ERCOT made repeated attempts to contact Peak Energy’s ADR senior dispute representative to schedule the initial ADR meeting.  Despite these repeated attempts, Peak Energy never responded to ERCOT’s emails or phone calls, and made no other effort to schedule the initial ADR meeting.

ERCOT Protocol Section 20.5(4) provides that “[i]f the party that submitted the request for ADR fails to make reasonable efforts to schedule and attend the initial ADR meeting within the time required (including any agreed-upon extension of time), ERCOT may, in its sole discretion, deny the dispute.”  Because Peak Energy failed to make any effort to schedule or attend an initial ADR meeting in this case, ERCOT is denying Peak Energy’s ADR request pursuant to ERCOT’s authority under ERCOT Protocol Section 20.5(4).

This Market Notice serves to conclude the ADR proceedings between ERCOT and Peak Energy.

ADDITIONAL INFORMATION: Two ADR requests filed by other Market Participants, which raised similar claims for the same ODs put at issue by Peak Energy, were recently denied by ERCOT.  See Resolution of ADR Proceedings between ERCOT and Monterey TX LLC (ADR No. 2020-MON-01) and Resolution of ADR Proceedings between ERCOT and DC Energy Texas, LLC (ADR No. 2020-DCE-01).

CONTACT: If you have any questions, please contact your ERCOT Account Manager. You may also call the general ERCOT Client Services phone number at (512) 248-3900 or contact ERCOT Client Services via email at ClientServices@ercot.com.

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