NPRR1036  Late Payment Enforcement Provisions

This Nodal Protocol Revision Request (NPRR) clarifies certain processes associated with “Late Payments” and “Payment Breaches” and aligns Protocol language in Section 16, Registration and Qualification of Market Participants, with language in the Standard Form Market Participant Agreement. First, this NPRR removes the option for ERCOT to terminate a Counter-Party’s Standard Form Market Participant Agreement under Level III Enforcement when a Market Participant has made three Late Payments. This is done to eliminate a potential conflict with the Standard Form Market Participant Agreement, which states that automatic termination may occur after more than three payment breaches in a 12-month period. Instead, Level III Enforcement actions are revised to ramp up from Level I and Level II actions. Also, the Level II requirement for additional “Financial Security” is increased from 110% to 115% to ramp up from Level I. Next, this NPRR clarifies the means by which ERCOT will determine the time of receipt of payments for purposes of assessing if a payment is a Late Payment by specifying that ERCOT will use the timestamp for when funds are credited to ERCOT’s bank account for purposes of determining if a payment is a Late Payment. Finally, clarification is provided that payments are due by the times specified in the Protocols, not at the close of the Bank Business Day. This clarification is made because requests for Financial Security may be due at a different time than Settlement Invoices.