Mathematical validation and realistic considerations on expected energy treatments

As part of the CAISO market redesign, the Market Quality System (MQS) represents an important subsystem that manages the market result data, facilitates after-the-fact data corrections, and most importantly, computes the settlement needed intermediate results. Most of the intermediate results calculated by the MQS are the 5-minute based, granular, expected energy and allocation results per each expected energy type. There are several different kinds of resources and more than twenty different kinds of expected energy types, the business rules specify how these different types of expected energy should be calculated for different resource types. There has been a concern whether or not all the real-time expected energy components calculated from the expected energy calculation formulas derived from the CAISO business rules sum up to the instructed imbalance energy. This paper is aimed at providing a mathematical justification that all the real-time expected energy components sum up to the instructed imbalance energy for each 5-minute interval and for any resource. In addition, some practical issues in the expected energy calculation in the production environment are discussed.