LMP Calculation Consistency Clause Samples

LMP Calculation Consistency. The Parties agree to ensure that LMP signals meet certain common criteria in order to achieve maximum benefits to competition from the joint and common market. In particular, the Parties agree that dispatch in both markets will be performed under a nodal pricing regime and that settlement will be based, in part, on the resulting LMPs. Given the importance of the individual LMPs, the pricing methodologies employed will result in prices that meet certain common criteria at all relevant physical interfaces between the two markets. The Parties’ goal will be that the respective prices calculated by both Parties for these interfaces will be identical. Therefore, to the extent that such prices are not identical, the Parties agree to work in good faith to resolve the reasons for the differences in order to send the most consistent economic signals reasonably possible to all market participants.