Configuration Guide for: Invoice Deviation Interest Allocation / Date: 05/19/09021/1520/2011
Settlements & Billing
BPM Configuration Guide: Invoice Deviation Interest Allocation
CC 7999
Version 5.01
ÓCAISO, 2011 / Page 9 of 10Settlements & Billing / Version: 5.01
Configuration Guide for: Invoice Deviation Interest Allocation / Date: 05/19/09021/1520/2011
Table of Contents
1. Purpose of Document 3
2. Introduction 3
2.1 Background 3
2.2 Description 3
3. Charge Code Requirements 5
3.1 Business Rules 5
3.2 Predecessor Charge Codes 7
3.3 Successor Charge Codes 7
3.4 Inputs – External Systems 8
3.5 Inputs - Predecessor Charge Codes or Pre-calculations 8
3.6 CAISO Formula 8
3.7 Outputs 8
4. Charge Code Effective Date 9
1. Purpose of Document
The purpose of this document is to capture the requirements and design specification for a SaMC Charge Code in one document7999 to assess and apply interest, by Scheduling Coordinator, CRR Holder, Black Start Generator or Participating TO, to deviations for each Trading Month between: (i) each Initial Settlement Statement T+7B (invoiced semi-monthly) and Recalculation Settlement Statement T+ 38B (invoiced monthly); and (ii) Recalculation Settlement Statement T+38B (invoiced monthly) and Recalculation Settlement Statement T+76B (invoiced monthly); (iii) Recalculation Settlement Statement T+76B (invoiced monthly) and Rerun Settlement Statement T+18M (invoiced monthly); (iv) Rerun Settlement Statement T+18M (invoiced monthly) and Rerun Settlement Statement T+35M (invoiced monthly); and, (v) Rerun Settlement Statement T+35M (invoiced monthly) and Rerun Settlement Statement T+36M (invoiced monthly).[1]
2. Introduction
2.1 Background
The CAISO’s payment acceleration program significantly shortens the time period in which the CAISO invoices and settles market transactions. Under payment acceleration, the timeframe for the CAISO’s release of its Initial Settlement Statement for each Trading Day is reduced from 38 to 7 Business Days and the payment timeline isare reduced, which shortens from 38 Business Days after the last Trading Day of the month through semi-monthly invoicing. As a result, the average cash clearing schedule is shortened from approximately 80 to 25 calendar days. The shorter cash clearing schedule reduces the amount of outstanding market charges and payments, and exposes Market Participants to less credit risk.
Under the payment acceleration program, the CAISO charges or pays interest, by Scheduling Coordinator, CRR Holder, Black Start Generator or Participating TO, for each Trading Month based on deviations between: (i) each Initial Settlement Statement T+7B and Recalculation Settlement Statement T+ 38B; and (ii) Recalculation Settlement Statement T+38B and Recalculation Settlement Statement T+76B; and (iii) succeeding deviations between two consecutive settlement statements; (iii) Recalculation Settlement Statement T+76B and Rerun Settlement Statement T+18M; (iv) Rerun Settlement Statement T+18M and Rerun Settlement Statement T+35M; and, (v) Rerun Settlement Statement T+35M and Rerun Settlement Statement T+36M.
The application of interest ensures that the time value of money is properly accounted for when Market Participants initially are overcharged or undercharged due to estimated Meter Data, updates to SQMD Meter Data, and price adjustments on Invoices generated semi-monthly at T+7B. The interest provision is also intended to eliminate financial incentive to submit unreasonable estimates of Meter Data for the Initial Settlement Statement T+7B.
2.2 Description
Interest will be charged or paid through new separate Charge Codes (7989 and 7999) in the CAISO Settlements system. These Charge Codes will be based on deviations for each Trading Month, by Scheduling Coordinator, CRR Holder, Black Start Generator or Participating TO, between: (i) each Initial Settlement Statement T+7B and Recalculation Settlement Statement T+ 38B; and (ii) Recalculation Settlement Statement T+38B and Recalculation Settlement Statement T+76B; and (iii) succeeding deviations between two consecutive settlement statementsRecalculation Settlement Statement T+76B and Rerun Settlement Statement T+18M; Rerun Settlement Statement T+18M and Rerun Settlement Statement T+35M; and, Rerun Settlement Statement T+35M and Rerun Settlement Statement T+36M.
There are three variables used to calculate the interest applicable to the deviations:
· FERC annual rate of interest
· Number of interest days; and
· The amount of each deviation.
Because invoicing occurs semi-monthly and is based on statements ranging in date from the 1st to the 15th of the month and from the 16th to the end of the month, the deviation must be determined for each Trading Month between:
· the Recalculated Settlement Statement T+38B and each semi-monthly initial Invoice;
· the Recalculated Settlement Statement T+76B and the Recalculated Settlement Statement T+38B;
· the Rerun Settlement Statement T+18M and the Recalculated Settlement Statement T+76B;
· the Rerun Settlement Statement T+35M and the Rerun Settlement Statement T+18M, if necessary; and,
· the Rerun Settlement Statement T+36M and the Rerun Settlement Statement T+35M, if necessary must be determined.
Four Seven bill determinants are required to record total amounts of the Initial Settlement Statements T+7B from the 1st to the 15th and the 16th to the end of the month, as well as total amounts of the Recalculation Settlement Statement T+38B, and Recalculation Settlement Statement T+76B, Rerun Settlement Statement T+18M, Rerun Settlement Statement T+35M and Rerun Settlement Statement T+36M for the same Trading Month. For clarification, the following terms are used to identify these amounts.
· Initial_1 is the total amount for the Initial Settlement Statements T+7B from the 1st to the 15th.
· Initial_2 is the total amount for the Initial Settlement Statements T+7B from the 16th to the end of the month.
· TrueUp_1 is the total amount for Recalculation Settlement Statement T+38B for the Trading Month that corresponds with Initial_1 and Initial_2.
· TrueUp_2 is the total amount for Recalculation Settlement Statement T+76B for the Trading Month that corresponds with Initial_1 and Initial_2.
· TrueUp_3 is the total amount for Rerun Settlement Statement T+18M for the Trading Month that corresponds with Initial_1 and Initial_2.
· TrueUp_4 is the total amount for Rerun Settlement Statement T+35M for the Trading Month that corresponds with Initial_1 and Initial_2.
· TrueUp_5 is the total amount for Rerun Settlement Statement T+36M for the Trading Month that corresponds with Initial_1 and Initial_2.
Interest charged or paid will be calculated back to the due date of the initial Invoices; therefore, bill determinants are required to determine the number of days of interest between these due dates.
If the due dates between the initial Invoice containing Initial Settlement Statements T+7B and the initial Invoice containing Recalculation Settlement Statement T+38B, or Recalculation Settlement Statement T+76B, Rerun Settlement Statement T+18M, Rerun Settlement Statement T+35M or Rerun Settlement Statement T+36M span calendar quarters, then interest is compounded quarterly. Since the due dates between an initial Invoice containing Initial Settlement Statements T+7B and the last Recalculation Rerun Settlement Statement T+76B 36M can span at most threeseveral several calendar quarters, a number of 3 4 15 bill determinants shall beare defined to record the applicable FERC interest rate for complete quarters during the span as well as portions of quarters at the start or at the end of the span as needed.each of those quarters.
Finally, if the interest calculated results in a payment to a Scheduling Coordinator, CRR Holder, Black Start Generator or Participating TO, the Charge Code to be used is 7989. If the interest calculated results in payment to the CAISO by the Scheduling Coordinator, CRR Holder, Black Start Generator or Participating TO, the Charge Code to be used is 7999. Charge Code 7999 will be discussed in this configuration document.
3. Charge Code Requirements
3.1 Business Rules
Bus Req ID / Business Rule /1.0 / Invoice deviation interest allocation is provided by Market Clearing to Settlements.
2.0 / A business requirement exists that invoice deviation interest allocation appears on the first available initial Invoice. The Trading Day will always reflect either the 15th or end of month Trading Days.
3.0 / Settlements receive from Market Clearing supporting data which is provided to the Market Participants for validation purposes.
4.0 / FERC published annual interest rate may change on a quarterly basis.
5.0 / ‘From Date’ is defined as the due date for initial Invoice or beginning of quarter date.
5.1 / ‘From Date Type’ is defined as a set of enumerations that indicate what type the ‘From Date’ represents and the set of values are: ‘Initial 1 Due Date’, ‘Initial 2 Due Date’, ‘BOQ1 Date’, ‘BOQ2 Date’, ‘BOQ3 Date’, ‘BOQ4 Date’, ‘BOQ5 Date’, ‘BOQ6 Date’, ‘BOQ7 Date’, ‘BOQ8 Date’, ‘BOQ9 Date’, ‘BOQ10 Date’, ‘BOQ11 Date’, ‘BOQ12 Date’, ‘BOQ13 Date’, ‘BOQ14 Date’ and ‘BOQ315 Date’.
6.0 / ‘To Date’ is defined as the due date of true up adjustment Invoice or end of quarter date.
6.1 / ‘To Date Type’ is defined as a set of enumerations that indicate what type the ‘To Date’ represents and the set of values are: ‘True Up 1 Due Date’, ‘True Up 2 Due Date’, ‘True Up 3 Due Date’, ‘True Up 4 Due Date’, ‘True Up 5 Due Date’, ‘EOQ1 Date’, ‘EOQ2 Date’, ‘EOQ3 Date’, ‘EOQ4 Date’, ‘EOQ5 Date’, ‘EOQ6 Date’, ‘EOQ7 Date’, ‘EOQ8 Date’, ‘EOQ9 Date’, ‘EOQ10 Date’, ‘EOQ11 Date’, ‘EOQ12 Date’, ‘EOQ13 Date’, ‘EOQ14 Date’ and ‘EOQ315 Date’.
7.0 / The difference between ‘From Date’ and ‘To Date’ determines the number of days used in the interest calculation formula.
8.0 / FROM_DATE_TYPE VALUE DESCRIPTION
Initial_1_Due_Date 1st initial Invoice due date
Initial_2_Due_Date 2nd initial Invoice due date
BOQ1_Date Beginning of 1st quarter date
BOQ2_Date Beginning of 2nd quarter date
BOQ3_Date Beginning of 3rd quarter date
BOQ4_Date Beginning of 4th quarter date
BOQ5_Date Beginning of 5th quarter date
BOQ6_Date Beginning of 6th quarter date
BOQ7_Date Beginning of 7th quarter date
BOQ8_Date Beginning of 8th quarter date
BOQ9_Date Beginning of 9th quarter date
BOQ10_Date Beginning of 10th quarter date
BOQ11_Date Beginning of 11th quarter date
BOQ12_Date Beginning of 12th quarter date
BOQ13_Date Beginning of 13th quarter date
BOQ14_Date Beginning of 14th quarter date
BOQ15_Date Beginning of 15th quarter date
TO_DATE_TYPE VALUE DESCRIPTION
True_Up_1_Due_Date 1st True-Up adjustment
Invoice due date
True_Up_2_Due_Date 2nd True-Up adjustment
Invoice due date
True_Up_3_Due_Date 3rd true-up adjustment
Invoice due date
True_Up_4_Due_Date 4th true-up adjustment
Invoice due date
True_Up_5_Due_Date 5th true-up adjustment
Invoice due date
EOQ1_Date End of 1st quarter date
EOQ2_Date End of 2nd quarter date
EOQ3_Date End of 3rd quarter date
EOQ4_Date End of 4th quarter date
EOQ5_Date End of 5th quarter date
EOQ6_Date End of 6th quarter date
EOQ7_Date End of 7th quarter date
EOQ8_Date End of 8th quarter date
EOQ9_Date End of 9th quarter date
EOQ10_Date End of 10th quarter date
EOQ11_Date End of 11th quarter date
EOQ12_Date End of 12th quarter date
EOQ13_Date End of 13th quarter date
EOQ14_Date End of 14th quarter date
EOQ15_Date End of 15th quarter date
3.2 Predecessor Charge Codes
Charge Code/ Pre-calc Name /None
3.3 Successor Charge Codes
Charge Code/ Pre-calc Name /None
3.4 Inputs – External Systems
Row # / Variable Name / Description /1 / BADayInvoiceDeviationInterestAllocation BU’Umd / Interest amount to be charged to the Market Participant due to positive invoice deviation as a financial adjustment by Business Associate ID (B), Bill Period Start (U’), Bill Period End (U), Trading Month (m) and Trading Day (d).
3.5 Inputs - Predecessor Charge Codes or Pre-calculations
Row # / Variable Name / Predecessor Charge Code/Pre-calc Configuration
None
3.6 CAISO Formula
3.6.1 BADayInvoiceDeviationInterestAllocationAmount BU’Umd =
BADayInvoiceDeviationInterestAllocation BU’Umd
Implementation Note:
The above charge type shall not be provided. However, the above input, BADayInvoiceDeviationInterestAllocation BU’Umd, as well as supporting data inputs identified in the Inputs section in Charge Code 7989 shall be provided in the BD files.
3.7 Outputs
Output Req. ID / Name / DescriptionAll external inputs shall be included as outputs.
1 / BADayInvoiceDeviationInterestAllocationAmount BU’Umd / The total amount of interest to be charged to the Market Participant due to a positive invoice deviation by Business Associate ID (B) Bill Period Start (U’), Bill Period End (U) Trading month (m) and Trading day (d).
4. Charge Code Effective Date
Charge Code/Pre-calc Name / Document Version / Effective Start Date / Effective End Date / Version Update Type /
Invoice Deviation Interest Allocation (CC 7999) / 5.0 / 11/01/09 / Open10/31/09 / Configuration Impacted
Invoice Deviation Interest Allocation (CC 7999) / 5.1 / 11/01/09 / Open / Configuration Impacted
ÓCAISO, 2011 / Page 9 of 10
[1] Capitalized terms in this Configuration Guide have the same meaning as set forth in (i) CAISO Tariff, Appendix A, Master Definitions Supplement, (ii) the BPM for Settlements and Billing, Section 8.2, Sign & Subscript Conventions, or (ii) this Configuration Guide.