What are Block Dispatch Settlement Differences?

Overview

The 'Block Dispatch Settlement Difference' is the difference between the amounts settled when market nodes in the block dispatch group are dispatched as a block, compared to the amount that would have potentially been settled if the market nodes in that block were dispatched individually.

Below is an example of how the Block Dispatch Settlement Differences are calculated each month.

Example for Block A

Trading Period 1

Generation Qty (MWs) Reconciled Qty (MWs) Final Price Calculation Settlement Differences
Market Node 1 50 55 $100.00 $100 x (55 - (50 x (155/150)))/2  $166.67
Market Node 2 60 65 $90.00 $90 x (65 - (60 x (155/150)))/2  $135.00
Market Node 3 40 35 $80.00 $80 x (35 - (40 x (155/150)))/2 -$253.33
Block Totals 150 155  $48.33

Trading Period 2

Generation Qty (MWs) Reconciled Qty (MWs) Final Price Calculation Settlement Differences
Market Node 1 150 149 $45.00 $45 x (149 - (150 x (493/485)))/2  -$78.17
Market Node 2 200 210 $46.00 $46 x (210 - (200 x (493/485)))/2  $154.12
Market Node 3 135 134 $33.00 $33 x (134 - (135 x (493/485)))/2 -$53.24
Block Totals 485 493  $22.71

Trading Period 3

Generation Qty (MWs) Reconciled Qty (MWs) Final Price Calculation Settlement Differences
Market Node 1 90 89 $50.00 $50 x (89 - (90 x (271/275)))/2  $7.73
Market Node 2 100 102 $52.00 $52 x (102 - (100 x (271/275)))/2  $89.82
Market Node 3 85 80 $51.00 $51 x (80 - (85 x (271/275)))/2 -$95.97
Block Totals 275 271  $1.58

The above example assumes:

  • There are only three trading periods in this billing period
  • There are three market nodes in Block A
The Maximum settlement difference for this block for this billing period would be $48.33 and the Total settlement difference for this block for this billing period would be $72.62...($48.33 + $22.71 + $1.58)

What do the positive and negative Settlement Differences mean?

  • A positive difference indicates that settlement when block dispatched would be higher than when station dispatched.
  • A negative difference indicates that settlement when station dispatched would be higher than when block dispatched.

Definitions

  • Generation Quantity - Is the same as the dispatched quantity in 'Constrained on' calculations and means the time weighted average quantity of electricity for that market node for that trading period, taking into account:
    • The quantity in MW provided to the Clearing Manager by the Dispatcher
    • The ramp rate applying to that trading period that is specified in the offer submitted by that Generator Class Market Participant (GCMP).
  • Reconciled Quantity - Is the quantity of electricity in MW's sold by each GCMP (as determined by the Reconciliation Manager) at a particular grid injection point for a trading date and trading period.
  • Market Node - A combination of a Grid Injection Point and a station.
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