- What is an FTR?
- How can a participant obtain an FTR?
- What FTR training is available from ISO New England?
- Are successful FTR bidders identified after the auction?
- How does the ISO notify customers about what FTRs are available in the auction?
- In the annual FTR auction, can a participant bid for on peak, off peak, and the full 24-hour day?
- What is the dollar per megawatt ($/MW) offer for the different auction lengths (monthly, annual)?
- What FTR auction results are posted and when and where?
- Why can't the ISO specify a minimum amount of FTRs to buy or sell in an FTR auction?
- What is the difference between the total value of an FTR auction and the total revenue for an FTR auction?
- Do FTRs always have to go through the Hub?
- What are the requirements to become an eligible FTR bidder?
- Does the ISO offer FTRs as options compared with only offering FTRs as obligations?
- Does a Simultaneous Feasibility Test (SFT) run all single transmission contingencies?
- Does an SFT run generation contingencies?
- Are planned transmission lines included in the long-term FTR auctions?
- Can FTRs and auction revenue rights (ARRs) be associated with the existing non-pool-transmission facility (PTF) ties?
- Does an SFT account for special protection systems (SPSs) and runbacks (i.e., when a special event occurs and a generating unit can reduce output) when modeling the contingencies?
- How does a participant access the FTR PSS/e (power system software) power-flow data?
- Does a participant pay its bid price or the market-clearing price of the FTR, which could be lower?
- How are excess transmission congestion revenues at the end of year distributed to congestion-paying entities?
- Does ISO New England publish data for the distribution of transmission congestion revenues?
- Are the cost-effectiveness ratios, which provide a relative stacking order for selecting FTRs, based on each binding constraint published?
- What is the financial obligation when a line is unexpectedly out of service for a long time?
- Does the ISO hold an annual ARR allocation auction similar to PJM, or does the ISO automatically allocate ARR revenue to load-serving entities (LSEs)?
- What is the source of FTR auction revenue for the allocation of ARRs—the annual FTR auction or the monthly FTR auctions?
- Does the ISO publish the ARR allocation dollars by zone?
- Do holders of excepted transactions (ETs) receive ARRs?
- Can NEPOOL Auction Revenue Rights ever be a liability to the ARR holder? For example, can they be negative, such that the ARR holder would need to pay the ISO?
- Where are the auction schedule updates located on the ISO’s website?
- How can a participant access information on the FTR model used in the monthly auctions?
- How are FTR bids deleted after they have been submitted for the February FTR market? Will the new file override the existing file?
- Why is a file upload rejected without explanation?
What is an FTR?
FTR stands for Financial Transmission Right. It is part of the ISO’s Congestion Management/ Multisettlement System. An FTR provides a forward congestion hedge in the Day-Ahead Energy Market. It hedges the difference between the congestion components of the locational marginal prices (LMPs) of two pricing nodes in the day-ahead market.
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How can a participant obtain an FTR?
FTRs are available by auction from the ISO, which conducts monthly and annual FTR auctions. The schedule for auctions is located at the following website: http://www.iso-ne.com/markets/othrmkts_data/ftr/calendars/index.html.
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What FTR training is available from ISO New England?
Access all of ISO-NE’s training materials. Select Document Type “Financial Transmission Rights” to see a list of FTR training materials.
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Are successful FTR bidders identified after the auction?
Yes. The following information is published in ISO Express after an auction is complete:
- FTR market identification—annual or monthly
- Source and sink identity of the FTR
- Owner name
- Class—on peak or off peak
- Purchase or sale
- Megawatt amount
- Clearing price
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How does the ISO notify customers about what FTRs are available in the auction?
The availability of FTRs depends on the auction assumptions located in the eFTR application.
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In the annual FTR auction, can a participant bid for on peak, off peak, and the full 24-hour day?
In a single bid, a participant can bid for on peak and off peak separately but not for the full 24-hour day.
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What is the dollar per megawatt ($/MW) offer for the different auction lengths (monthly, annual)?
The offer price is always for the length of the auction, so the offer would be in terms of MW-month or MW-year.
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What FTR auction results are posted and when and where?
The posted results include the megawatts cleared, the path (from location to location) for the full period of the FTR auction, the winning bidders, and the FTR clearing prices at all locations. (See Market Rule 1 [MR 1], Section III.7.3.7, and Manual M-06, Section 3.5). The ISO publishes the results in accordance with the FTR Auction Calendar.
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Why can't the ISO specify a minimum amount of FTRs to buy or sell in an FTR auction?
Market Rule 1, Section III.7.3.5 does not allow the ISO to specify the minimum quantity. Additionally, the effort to develop the software that would enable the ISO to accept a minimum quantity for an FTR auction would require significant cost and time.
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What is the difference between the total value of an FTR auction and the total revenue for an FTR auction?
The value of an FTR auction is based on the bid prices. The FTR auction revenue is based on the clearing prices, which are set by the marginal FTRs. This question references WEM201 training, which discusses the maximization of an auction’s bid value when clearing the FTRs during the auction. As the training shows, marginal FTRs set the clearing prices that determine auction revenue. As a result, marginal FTRs pay their bid price, FTRs that fully clear pay the clearing price (usually less than their bid price), and FTRs that fail to clear bid too low.
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Do FTRs always have to go through the Hub?
No. FTRs may be sold from any location to any location including nodes, external nodes, load zones, and the Hub:
- Node: a point on the transmission system for which nodal prices for electric energy are calculated
- External node: A location on the transmission system outside the New England Balancing Authority Area; a point of interconnection to a neighboring balancing authority area or system
- Load zones: An aggregation of pricing nodes within a specific area
- Hub: A specific set of predefined pricing nodes for which LMPs are calculated and which are used to establish reference prices for electric energy purchases, the transfer of day-ahead and real-time adjusted load obligations, and the designation of Financial Transmission Rights.
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What are the requirements to become an eligible FTR bidder?
The ISO tariff, Section I, General Terms and Conditions, defines an eligible FTR bidder as an entity that has satisfied the applicable financial assurance criteria and is not the auctioneer; an affiliate of the auctioneer; or an officer, director, employee, consultant, or other representative of the auctioneer.
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Does the ISO offer FTRs as options compared with only offering FTRs as obligations?
Options are not included in the FTR market, and the ISO is not currently investigating the implementation of options in this market. The ISO may be obligated to implement options in the future, depending on directives from the Federal Energy Regulatory Commission.
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Does a Simultaneous Feasibility Test (SFT) run all single transmission contingencies?
No. An SFT does not run all transmission contingencies. The transmission-contingencies an SFT runs during an FTR auction are the same contingencies the ISO uses to clear the Day-Ahead and Real-Time Energy Markets.
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Does an SFT run generation contingencies?
No. The SFT process does not model generators for the FTR auction. The process only models injections from the FTRs that participants bid for in the FTR auction and injections from those FTRs already awarded from a previous FTR auction.
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Are planned transmission lines included in the long-term FTR auctions?
No. Planned transmission lines are not included in the FTR auctions.
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Can FTRs and auction revenue rights (ARRs) be associated with the existing non-pool-transmission facility (PTF) ties?
FTRs are not associated with individual ties, but rather, the paths enabled by the ties. (The network model represents the ties, participants place bids at the external nodes, and interface limits can constrain the flows and FTRs.)
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Does an SFT account for special protection systems (SPSs) and runbacks (i.e., when a special event occurs and a generating unit can reduce output) when modeling the contingencies?
FTR auctions recognize the existence of SPSs. Runbacks have no significance for an SFT because it does not model generation.
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How does a participant access the FTR PSS/e (power system software) power-flow data?
Eligible FTR bidders and holders can access the FTR-pertinent PSS/e power-flow information and other documents associated with a particular upcoming FTR auction via the eFTR application. Customers should enter the eFTR application and select the hot link called “FTR Market” on the top middle of the page.
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Does a participant pay its bid price or the market-clearing price of the FTR, which could be lower?
Winning eligible FTR bidders always pay the FTR clearing price for the associated FTR path.
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How are excess transmission congestion revenues at the end of year distributed to congestion-paying entities?
Revenues remaining at year-end after FTR holders are compensated for any shortfalls that occurred during the calendar year are distributed to market participants. Manual M-06, Section 6.3.5, describes how excess transmission congestion revenues are distributed.
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Does ISO New England publish data for the distribution of transmission congestion revenues?
Yes, the Congestion Revenue Summary includes the pool totals for the distribution of transmission congestion revenues.
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Are the cost-effectiveness ratios, which provide a relative stacking order for selecting FTRs, based on each binding constraint published?
No. This question references WEM201 training where a cost effectiveness ratio is used to illustrate how the FTR auction’s optimization works. These ratios are not available from the auction software the ISO uses to conduct the FTR auctions.
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What is the financial obligation when a line is unexpectedly out of service for a long time?
Manual M-06, Section 5, explains how shortfalls and excess collections of transmission congestion revenue are offset.
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Does the ISO hold an annual ARR allocation auction similar to PJM, or does the ISO automatically allocate ARR revenue to load-serving entities (LSEs)?
Reference Manual M-06 FTRs, Section 7.2, ARR Overview. Revenues from the FTR auction are allocated to 1) entities paying for transmission upgrades and 2) congestion-paying LSEs.
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What is the source of FTR auction revenue for the allocation of ARRs—the annual FTR auction or the monthly FTR auctions?
The revenue comes from all FTR auctions.
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Does the ISO publish the ARR allocation dollars by zone?
The ARR MIS reports located on the FTP site include the allocations by zones. These data are available to market participants only. See the FAQs, Accessing MIS Reports from Secure FTP Accounts, for additional information.
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Do holders of excepted transactions (ETs) receive ARRs?
Not anymore. Grandfathered ET treatment has expired. Their treatment was effective for a 10-year period after the start of the markets in March 2003.
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Can NEPOOL Auction Revenue Rights ever be a liability to the ARR holder? For example, can they be negative, such that the ARR holder would need to pay the ISO?
Yes, a negative real-time load obligation (RTLO) would require the ARR holder to make a payment.
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Where are the auction schedule updates located on the ISO’s website?
The auction schedule updates are posted with the FTR Calendars, which are updated annually and include both the annual and monthly FTR auction dates.
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How can a participant access information on the FTR model used in the monthly auctions?
Information on the FTR model is posted on a secure website. This information is only available to participants who have been granted access by their company's security administrator. The ISO does not provide nonparticipants with access to this information.
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How are FTR bids deleted after they have been submitted for the February FTR market? Will the new file override the existing file?
FTR bids can be deleted per the instructions contained in the eFTR User Guide.
A successful upload will not override a previous successful upload. To replace a previous successful upload, the previous upload must first be deleted. Then a new upload can be successfully entered for an FTR bid for the auction. Each additional successful upload adds FTR bids to the market.
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Why is a file upload rejected without explanation?
These files are “comma delineated” and must be converted into a.txt file to view the errors. After the file is converted into a text file, the extra commas must be removed. This is a typical problem that causes a file to be rejected. The eFTR User Guide includes error codes and directions on how to properly format this file.
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