Committees & Groups

Issue Details

Opportunity Cost Calculator

The current rules pertaining to the calculation of costs used in cost-based offers into the energy market allow Market Sellers to include an opportunity cost under certain conditions, such as environmental limitations. PJM developed an opportunity cost calculator, which is included in Markets Gateway, to enable Market Sellers to calculate an opportunity cost. Separately, Monitoring Analytics has developed its own opportunity cost calculator. There is some question about whether the two different opportunity cost calculators produce the same or comparable results and whether either calculator captures all scenarios. When PJM implemented CP, it established potential penalties for failure to deliver during emergencies. The opportunity cost calculators were not updated to reflect the penalty rates. As such, the opportunity cost calculator may be calculating an opportunity cost that is too low as the resource approaches a run hour limitation.

Proposed Timeline

Issue initiated: 3.23.2017
Work begins: 5.23.2017
Target Completion: TBD
Actual Completion: TBD

Issue Details

Stakeholder Body Market Implementation Committee
Facilitator Freeman, Jennifer
Subject Matter Expert Freeman, Jennifer
Problem Statement/
Issue Charge First Read
2.23.2017
Issue Catalyst Panda Power Funds
Issue Status Closed
Manual Changes Yes
Agreement Changes Operating Agreement
  • Stakeholder Process Step

  • Completed Approved
  • Completed Education
  • Completed Interest
  • Completed Design
  • Completed Options
  • Completed Packages
  • Completed Consensus
  • Completed Review
  • Completed Completed