Buy Bids. The total FTR buy bids in the 2013 to 2014 Annual FTR Auction were 3,274,373 MW. The total FTR buy bids in the Monthly Balance of Planning Period FTR Auctions for the 2012 to 2013 planning period were 19,685,688 MW.
Buy Bids. In the 2013 to 2016 Long Term FTR Auction, total FTR cleared buy bids increased 11.9 percent to 290,700 MW. In the Annual FTR Auction, total cleared FTR buy bids and self-scheduled bids decreased 4.2 percent to 371,295 MW. The total FTR buy bids from the Monthly Balance of Planning Period FTR Auctions for the first seven months of the 2012 to 2013 planning period decreased 9.6 percent to 1,437,438 MW. Patterns of Ownership The overall ownership structure of FTRs and the ownership of prevailing flow and counter flow FTRs is descriptive and is not necessarily a measure of actual or potential FTR market structure issues, as the ownership positions result from competitive auctions. The percentage of FTR ownership shares may change when FTR owners buy or sell FTRs in the Monthly Balance of Planning Period FTR Auctions or the secondary bilateral market. The ownership concentration of cleared FTR buy bids resulting from the 2012 to 2013 Annual FTR Auction was low for peak and off peak FTR obligations and moderately concentrated for 24-hour FTR obligations. The ownership concentration was highly concentrated for 24-hour buy bid options, but only moderately concentrated for peak and off peak FTR buy bid options for the same time period. In order to evaluate the ownership of prevailing flow and counter flow FTRs, the MMU categorized all participants owning FTRs in PJM as either physical or financial. Physical entities include utilities and customers which primarily take physical positions in PJM markets. Financial entities include banks and hedge funds which primarily take financial positions in PJM markets. International market participants that primarily take financial positions in PJM markets are generally considered to be financial entities even if they are utilities in their own countries. Table 12-4 presents the 2013 to 2016 Long Term FTR Auction market cleared FTRs by trade type, organization type and FTR direction. The results show that financial entities purchased 80.4 percent of prevailing flow buy bid FTRs and 91.9 percent of counter flow buy bid FTRs with the result that financial entities purchased 85.5 percent of all Long Term FTR Auction cleared buy bids for the 2013 to 2016 Long Term FTR Auction. 13 See PJM. “Manual 6: Financial Transmission Rights,” Revision 12 (July 1, 2009), p. 39. Table 12-4 Long Term FTR Auction patterns of ownership by FTR direction: Planning periods 2013 to 2016 FTR Direction Trade Type Organization Type Prevailing Flow Counte...
Buy Bids. In the 2012 to 2015 Long Term FTR Auction, total FTR buy bids increased 1.3 percent from 400,222 MW to 405,504 MW. In the Annual FTR Auction total FTR buy bids and self scheduled bids increased 84.8 percent from 1,764,288 MW to 3,260,695 MW. The total FTR buy bids from the Monthly Balance of Planning Period FTR Auctions for the first seven months of the 2011 to 2012 planning period increased 42.3 percent from 8,973,645 MW, during the same time period of the prior planning period, to 12,767,075 MW. Limits on Number of Bids The PJM tariff specifies that PJM has the authority to limit the maximum number of FTR bids to 5,000 per participant for a monthly auction, or a single round of an annual auction, if necessary to avoid system performance issues.20 PJM has previously limited the maximum number of bids per participant to 20,000 bids. Effective with the September 2011 Monthly Balance of Planning Period FTR Auction, PJM reduced the maximum number of bids per participant to 10,000 bids for any FTR auction. For example, a participant in the September 2011 Monthly Balance of Planning Period FTR Auction could place 10,000 bids for each of the six periods of September, October, November, Q2, Q3 and Q4 for a total of 60,000 bids. PJM indicated that this reduction was required for reasons of system performance.21 This rule change affected only a small number of participants. The number of unique participants in the Annual FTR Auction has increased 20 OA Schedule 1 § 7.3.5(d). 21 See Messages section in eFTR within the PJM eSuite application <xxxxx://xxxxxx.xxx.xxx/mui/> (Accessed November 4, 2011). from 74, in the 2003 to 2004 planning period, to 272 in the 2011 to 2012 planning period, and the average MW bid has decreased from its peak of 29 MW per participant in the 2004 to 2005 planning period to 14 MW per bid in the 2011 to 2012 planning period. Credit Issues Default There were eight participants that defaulted during the 2011 calendar year and 12 default events. The average default for the 2011 calendar year was $282,721 with a maximum default of $2.55 million. Of all the defaults eight were based on collateral and four were based on payments. Six of the eight defaulting participants were financial companies. All of the credit defaults were promptly cured in the 2011 calendar year.22 These defaults were not related to FTR positions. Credit Rules Following a series of high profile defaults, PJM made significant reforms to its credit policies in 2007– 2009.23 On ...
