Market Renewal Newsletter - May Update
May 2, 2022
Every issue we feature an update from someone different on the Market Renewal team to shed light into their work.
From the desk of...
Ekene Umeike, Advisor, Market Development, Market Power Mitigation (MPM)
Establishing the framework to safeguard the competitive nature of Ontario’s electricity markets to foster conditions conducive to efficient market outcomes is the goal of the MPM team.
To accomplish this goal, the MPM framework will include measures to identify instances of restricted competition. It will also include actions that will be taken to prevent or reduce incentives for market participant behaviour that could make it more expensive to serve load in Ontario and result in inefficient market outcomes. The actions taken by the framework can be to reject dispatch data that does not match actual operational capabilities, replace offers in an area where market power conditions exist with pre-approved cost-based values or to issue settlement charges after-the-fact.
I joined the MPM team in September 2021. Since then I have, among other things, had the opportunity to work on the drafting business requirements for solutions that will enable future mitigation efforts. Most recently, our MPM team supported the stakeholder engagement around the Technical Panel’s review of the draft MPM market rules. There is more to be done, and the entire team is working hard to deliver a robust MPM framework.
As all of us in MRP work toward a successful go-live, it is a real pleasure to be able to play a role in shaping the future of Ontario’s electricity market.
Ekene Umeike
What we're working on
MRP Implementation Engagement Overview of the Economic Operating Point design
On April 21, the IESO held an MRP engagement meeting providing an overview of the methodology for determining economic operating point for lost cost and lost opportunity make whole payments. View the April recording here or visit the implementation engagement page.
March MRP Engagement Meeting
The IESO held an engagement meeting in March providing a quarterly update on navigating design solutions that arise as we work through implementing the MRP design. The second half of the meeting was a technical presentation that provided an overview on operational commitments in pre-dispatch: thermal state parameters and start-up notifications. View the March recorded presentation here.
Updated Market Power Mitigation market rules and market manuals
On March 15, the IESO posted updated Market Power Mitigation market rules and market manuals and a summary of changes. The IESO also released a response to stakeholder feedback on this batch of materials.
IESO news
2022 Annual Acquisition Report
The 2022 Annual Acquisition Report (AAR) has been released. The report describes Ontario’s electricity supply needs for the next 10 years and the existing and proposed solutions identified to meet them.
The electricity sector is undergoing a period of significant transformation, including an ongoing focus on electrification and rapid economic growth in a number of sectors. Demand is projected to rise for the foreseeable future, and this year’s report outlines actions the IESO plans to take to address electricity supply needs that emerge in 2025 and 2026, and continue to grow in the late 2020s and onward.
Mid-decade needs will require solutions beyond those already in place. The report discusses a number of options within the Resource Adequacy Framework, and introduces certain additional processes for securing this additional supply.
After 2026 the province’s need for additional resources will continue to grow. Building new facilities and expanding existing ones will require longer commitments, and the IESO is currently engaging with stakeholders on the first Long-Term RFP, with a focus on ensuring new investment in the province.
The IESO’s framework for securing an adequate energy supply is designed to respond to change, and the AAR is part of an iterative planning process that allows us to adapt through a flexible and cost-effective approach.
Looking Back at 20 Years of the IESO Wholesale Electricity Market
May 1, 2022 marked the 20th anniversary of the opening of the wholesale electricity market in Ontario. Establishing wholesale markets was a turning point in the evolution of Ontario’s electricity system that facilitated new ways of meeting changing electricity needs and opened the door to a more dynamic, diverse and cost-effective system.
A lot has happened since 2002. In the intervening years, the IESO has worked closely with stakeholders, communities and other partners to provide a reliable, affordable and sustainable supply of electricity to Ontarians. The diversity of the province’s supply resources has expanded substantially and innovative technologies continue to create new opportunities to reduce costs, improve efficiency and meet emerging needs.
Thank you to sector and market participants, community and Indigenous representatives and others for their ongoing input, feedback, guidance and support. To explore some of the major developments in Ontario’s electricity sector over the past 20 years, please see the overview and video available on the IESO website.
Did you know?
What is the Replacement of the IESO's Settlement System (RSS) Project?
The Replacement of the Settlement System (RSS) is a key project that will see a complete modernization of the IESO’s settlement system, the tool used to produce statements reflecting market participants’ involvement in IESO-administered markets. This project will address limitations within the existing system, enhance processes for filing and resolving notices of disagreements, and integrate changes resulting from the Market Renewal Program and future IESO initiatives.
The project is expected to be in-service November 1, 2022. Learn more about the status of the project and view recent stakeholder updates on the MRP Implementation engagement page, and stay tuned for more updates on testing plans.