MSA Transmission Must Run Investigation Report (February)
February 28, 2005
NOTICE TO MARKET PARTICIPANTS
Re: MSA Report - Transmission Must Run Investigation
In October 2004, the Market Surveillance Administrator (MSA) advised market participants that we had initiated an investigation into the competitiveness of the market for Transmission Must Run services (TMR) in Alberta. This investigation is now complete and the report posted to the MSA’s website. A copy of the MSA’s report may be obtained at the following link:
The following questions were addressed in the investigation:
1. Does a competitive market for TMR exist?
2. If the answer to #1 is no, is it possible to design and implement a competitive market for TMR?
3. If the answer to #2 is no, what are the alternatives to a competitive market?
The investigation considered these questions in the context of both the Rainbow Lake area and the wider market for TMR.
The MSA retained the services of Charles River Associates (Asia Pacific) Pty Ltd to prepare an independent assessment of the Alberta TMR market. This report will be posted to the MSA’s website on March 1, 2005.
The investigation concluded that overall, the process and outcomes for TMR, viewed over a number of years, have not been consistent with the promotion of a fair, efficient, and openly competitive process. The basis for the report’s findings included a review of technical need, balance of the Alberta Electric System Operator’s (AESO) statutory roles, the process for procuring TMR, and processes for managing disputes.
The report contains recommendations concerning the formal process for procuring TMR going forward, limitations on the use of conscription of TMR, monitoring of procurement processes and policy direction to the AESO on interpreting roles, objectives and obligations. The report also provides the MSA’s views on economic principles for pricing TMR.
Questions concerning the MSA Investigation report and the CRA report may be directed to the undersigned or Chris Joy at 403.233.6418 or via email at chris.joy@albertamsa.ca.
Yours truly,
MARKET SURVEILLANCE ADMINISTRATOR
“Original signed by Rob Spragins”
Robert F. Spragins
Manager, Investigations