Explanation of Changes
to Draft “Firming” Schedule,
Service Schedule E
Contact:
Arnie Podgorsky
Mike Thompson
Wright & Talisman PC
202-393-1200
The Proposed Schedule - general
 Product: intra-hour capacity and energy, on
either scheduled or dynamic basis, as/when
feasible under applicable NERC etc. criteria.
 Purchaser may be intermittent generator, BA, or
other market participant capable of deploying
intra-hour capacity/energy.
 Price may have capacity (demand) and energy
components
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August Revisions to Proposed Schedule E

To better relate nature of product, this draft renames it
“Intra-Hour Supplemental Power.”
 Name remains subject to discussion/other suggestions.
 Scheduled and dynamic service options are retained.

Section E-2 – Terms of Service
o Terms are generally the same as in initial draft, but this version
includes some terminology changes and some reorganization to
create more logical flow and to clarify certain terms in accordance
with Subcommittee comments:
o Terminology is changed to refer to rate of flow of energy, per
Subcommittee comments.
o Section E-2.1 describes Scheduled and Dynamic service options.
o Section E-2.2 places on Purchaser all risk (as between Seller and
Purchaser) of availability of transmission as needed to utilize IntraHour Supplemental Power.
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August Revisions to Proposed Schedule E
(cont’d)
о Section E-2.3 provides Purchaser an option to return energy to
Seller within 168 hours.
о Issues to be considered:
о How to define when return period starts, e.g., separate return period
for each hour Purchaser takes energy? Must energy taken in onpeak hours be returned in on-peak hours? If not, must return larger
quantity?
о Whether/how to adjust billing and payment to reflect possibility that
energy could be returned in the month following month of delivery to
Purchaser?
о Section E-2.4 states that each Party warrants to the other that its
communications and control systems are capable of executing
instructions for dispatch, delivery and receipt of Intra-Hour
Supplemental Power in accordance with Service Schedule E and in
conformance with applicable RRO and/or BA communications
protocols.
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August Revisions to Proposed Schedule E
(cont’d)
 Section E-2.5 – Pricing
о Provisions are substantively unchanged, but are reorganized to
reflect Subcommittee comments, including clarification of when and
to whom FERC-imposed price caps apply.
 Generally applicable energy charge term (E-2.5.2) now incorporates
peak/off-peak pricing per Subcommittee’s discussion, subject to Parties’
ability to apply a different pricing scheme in Confirmation.
 The new terms “On-Peak” and “Off-Peak” are NERC-defined terms.
 Confirmations will have to identify applicable price indices or other
means of establishing hourly and peak/off-peak prices.
 Section E-2.5.3 describes the elements of monthly charges for IntraHour Supplemental Power and states that Purchaser shall pay capacity
charge and any applicable transmission charge except to the extent
excused in event of Seller non-performance (in which case damages
will be owed under Section E-3, discussed later).
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August Revisions to Proposed Schedule E (cont’d)
 Section E-2.5 – Pricing (cont’d)
о Section E-2.5.3.3 now provides that monthly energy charge will be
determined by value of energy delivered by Seller netted against
value of any energy returned by Purchaser.
о Consider issue noted above concerning potentially adjusting billing
and payment to reflect possibility that energy could be returned in
the month following month of delivery to Purchaser.
о FERC Price caps are incorporated in Section E-2.5.4; substance is
the same as in draft Service Schedule D (and other WSPP Service
Schedules), but language is revised to try to make clearer, per
Subcommittee comments, when and to whom the price caps will
apply.
о Note revised language here is the same as in the August draft of
Service Schedule D.
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August Revisions to Proposed Schedule E (cont’d)
 Section E-3 - Damages
o Damages provisions are modified from the previous draft to reflect
Subcommittee’s direction to develop objective damages measures
while avoiding penalties.
o Section E-3.2 provides prefatory legal language stating that damages
calculated in accordance with the service schedule are not a penalty.
o Section E-3.3 provides that damages imposed under the service
schedule will not exceed three times the agreed monthly capacity
charge.
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August Revisions to Proposed Schedule E (cont’d)
 Section E-3 - Damages (cont’d)
o Section E-3.4 provides that damages for Seller’s non-performance
will be a pro rata share of the capacity charge and any transmission
reservation charge based on duration of non-performance, plus the
smallest of the following three alternative amounts (but not less
than zero):
o The quantity of energy Seller failed to deliver multiplied by an
Hourly Index Price (which is yet to be determined/defined), OR
o Replacement Price less Contract Price, plus any net increase in
transmission charges incurred to acquire replacement energy,
OR
o Quantity Seller failed to deliver multiplied by 120% of Parties’
agreed energy charge.
o In addition, Seller will be liable to Purchaser for any NERC or other
penalties or fines imposed on Purchaser to the extent such
amounts are attributable to Seller’s failure to perform.
o Consider whether this is appropriate for this service/product?
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August Revisions to Proposed Schedule E
(cont’d)
о Previous draft’s Section 3.3, stating Parties’ mutual duty to use
commercially reasonable efforts to mitigate damages is removed
because it is redundant of WSPP Agreement Section 21.3(c).
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Let’s Discuss
 Reactions to the modified provisions we have
discussed.
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