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Subject: RE: [emix] Baselines and Relative and Absolute Deltas
We have talked of many things in Energy Interop. The specification, so far, only has price. And as to supporting everything that ever there was? I think the highest form of that principle was Windows ME – which was a complete abomination. The pre-standard legacy, in every area, not just this, is a dog’s breakfast of incompatible and ugly bits. Practitioners are always attached to them, but the interface effort must move beyond mere cataloguing, to normalization—and normalization is rarely fully backward compatible. This is a feature of normalization, not a bug. Deciding what not to support is critical for the sort of simplicity and interoperation we hope to see in the future. tc "If flies are allowed to vote, how meaningful would a poll on what to have for dinner be, and what would be on the menu?" - Unknown
From: Girish Ghatikar [mailto:gghatikar@lbl.gov] Phil and Toby, On Sun, Jun 27, 2010 at 7:23 AM, Phil Davis <pddcoo@gmail.com> wrote: Toby, Lest we develop a whole new financial schema, perhaps we can benefit from existing practice in other commodities trades. Does anyone know if multiples are used elsewhere and for what purpose? The only instance of multiples as a signal for energy (that I am aware of) is in California. Since California hasn’t allowed meaningful wholesale market access, those transaction come through regulated IOU’s. The terms are formal tariffs approved by the CPUC. Any discussions we have for that type of environment are purely academic. PUC decisions on the matter will result from the normal process of interveners and politics. I am familiar with at least one IBM plant that is charged for electricity as a function of the amount of water consumed by its chillers. The tariffs written for local economic development purposes truly can be bizarre. This is why utility billing systems are so costly and why each is unique. At least for this phase, it might be more productive either to restrict our activities to wholesale market constructs, or to distinguish between wholesale and retail transactions. In the latter case, we should invite heavy input from NARUC and EEI (and similar). Also, since “baseline” has such a specific meaning and wide adoption with regard to a demand profile, might it be preferable to use another term for pricing, such as “reference price”? Since FERC’s current NOPR deals with Locational Marginal Price, my belief is that we will have much difficulty with any construct based on another pricing concept. Since LMP itself can be volatile intraday, using a multiples approach would add complexity to complexity and you’d still have to track the value of LMP anyway. Multiples can make sense at the retail level since either tariffs or contracts (from REPs) tend to talk in specific dollar values. However, billing systems in those environments can have a unique rate for each customer. The ability to do this is at the heart of a competitive retailer’s “differential advantage”. The best approach for the retail side might be to define “fields to be used later” in their layouts. Reactions? Thanks! Phil ________________________________________________________________________________________________ From: Toby Considine [mailto:tobyconsidine@gmail.com] On Behalf Of Toby Considine A continuing point of contention is unspecified prices that are changes from current prices. I want to start a conversation on baselines and relative and absolute change. As I understand the argument, there are times when it would be simple to send out a signal to everyone announcing that something is going to change. Whether you currently buy power at 0.02, o.08, 0.20, or 0.45 $ per kW h, you will experience a price change. Such a change could be one of two forms. (1) Relative: All prices double at 3:00 this afternoon (2) Absolute: App prices go up by 0.25 this at 3:00 this afternoon. Do we need both (assuming we need either)? I think it is essential here that we are discussing functionality and information required, and not discussing whether it is possible to communicate some price signal that was created to make sense at a PUC meeting as a way to juke the existing systems which only had one register free and that worked as a plausible hack on existing software and hardware—which is alas how many tariffs get written. Discussion: 1) Relative can be handled with no changes to the existing data structures, but with the creation of a special currency case, the “baseline”. Prices at 2:00 AM are .3 baselines. Price this afternoon is 1.4 baselines. This can make a clean set of rules for systems to optimize energy use over a 24 hour period. 2) Delta’s require more facts. It is unclear whether a rise of /50/kW H is interesting without special knowledge. Each system would need to hold occult knowledge, i.e. what was the price before. Is this change insignificant or is it a several-fold change in price? Delta’s also require a larger change in the base communication—it needs additional fields (and complexity and a new source of ono-interoperation). I would prefer no baseline pricing. I know others fell that we need relative pricing. I am stepping back from that argument for a moment. The question here is what does relative pricing look like, and what is the simplest kind of relative pricing we can use. “It is difficult to get a man to understand something, when his salary depends upon his not understanding it” -- Upton Sinclair.
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