1. BPA Formal Comments Recap of ‘Best Offer’ Proposal
API 2.a.i.1 – Short-term Preemption & ROFR
OS Sept 26-28, 2017

2. Problem Statement The current draft standards permit:
Preemption of capacity from a Defender with ROFR that is not needed by a Challenger.
Preemption of capacity inconsistent with Reservation Priority.
Capacity can be preempted from a Defender with ROFR instead of a Defender without ROFR.
Capacity can be preempted from a Defender with ROFR, and then be reallocated to a Defender without ROFR.
Root cause: Capacity is being preempted from Defenders with ROFR before knowing how much capacity the Challenger ultimately needs based on their final action.
BPA Formal NAESB OS /13/2017

3. Observations
It is necessary to first evaluate the ROFR requests submitted by Defenders with ROFR to determine how much capacity is available to be preempted to support a Challenger offer.
However…
It is also necessary to know the Challenger final action to determine how much capacity is actually needed to be preempted from Defenders with ROFR.
BPA’s “best offer” proposal reflects these observations to address the stated problems.
BPA Formal NAESB OS /13/2017

4. Proposed Order of Processing, with BPA’s edits
Sort and then evaluate ROFR requests to determine how much capacity is available to make an offer to the Challenger (based on the Matching and Remaining profiles that can be accommodated).
Make offer to Challenger. Wait until Challenger takes final action in order to determine how much capacity the Challenger actually needs to have preempted.
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Evaluate the Defenders without ROFR. Preempt as necessary.
Delay actual preemption (Recall) of the “best offer” Defenders with ROFR until after the Challenger is in a final state.
Re-evaluate the “best offer” Defenders with ROFR now that it is known how much capacity the Challenger actually needs. Preempt as necessary.
BPA Formal NAESB OS /13/2017

5. Example of Proposed Process
Evaluate Defenders with ROFR (x001-xx )
Explicitly decline ROFR
Only submit invalid ROFR requests
Do not submit any ROFR request
Valid ROFR request that is granted
Valid ROFR request that is not granted
Evaluate Challenger (x001-xx.4.6.6)
Re-evaluate the “best offer” Defenders
(updated x001-xx )
Evaluate Defenders without ROFR
Reservations (renumbered x001-xx )
Requests (renumbered x001-xx )
Profile
Remaining
Remaining
Remaining
Matching
Remaining
“Best Offer” Defenders are those that submit a valid ROFR request that cannot be granted in full and which have set the Best Offer flag to Y.
Delay preemption of these Defenders until after the Challenger has taken final action once the actual amount needed to be preempted is certain.
BPA Formal NAESB OS /13/2017

6. Limited Changes from the OS Recommendation
Add a new Data Element for the “best offer” flag to WEQ-003.
Add the “best offer” flag to the rofrrequest and rofrstatus templates in WEQ-002.
In both WEQ-001 and WEQ-013:
Introduce the use of the “best offer” flag as part of submitting a valid rofrrequest template.
Identify any “best offer” Defenders during the evaluation of ROFR requests. Delay preemption of these Defenders until after the Challenger has taken final action.
Add a new step to re-evaluate the “best offer” Defenders after the Challenger is in a final state. Preempt as necessary.
In WEQ-001, update timing Table xx-4 to incorporate time for the TP to re-evaluate the “best offer” Defenders.
BPA Formal NAESB OS /13/2017

7. Updates from BPA’s August Formal Comments
The Remaining profile will be honored during re-evaluation of “best offer” Defenders. This means the re-evaluation can only result in an offer that meets or exceeds the Remaining profile.
The “best offer” flag is no longer optional. Must be Y or N.
Added language to clarify that those Defenders who explicitly decline ROFR are ineligible for the “best offer”.
Added language to clarify that the TP shall incorporate the preemption of the “best offer” Defenders (up to the Remaining profile) in determining the offer available to the Challenger (even though that preemption would not occur until after the Challenger takes final action).
Updated the timing Table xx-4 to account for the time for TP re-evaluation of the “best offer” Defenders.
Added language to clarify the “best offer” Defenders must submit a Remaining profile that matches the one provided by the TP.
BPA Formal NAESB OS /13/2017

8. What Does NOT Change from the OS Recommendation
All standards related to Preemption without ROFR.
Everything else about the process and timing for submitting ROFR requests (except the addition of the ‘best offer’ flag).
Sorting of Defenders with ROFR.
Evaluation and processing of successful matches.
Evaluation, processing, and preemption of Defenders who explicitly decline ROFR and those who do not submit valid ROFR requests.
Evaluation and processing of the Challenger.
Evaluation, processing, and preemption of Defenders without ROFR.
Honoring the Remaining profile for Defenders with ROFR who are not granted a Matching profile.
Timing considerations for the Challenger.
Method of evaluation for any Defender with ROFR, Defender without ROFR, or the Challenger. A new re-evaluation step is being added, but the way in which the evaluations take place remain unchanged.
BPA Formal NAESB OS /13/2017

9. Timing Considerations to address Reservation Priority
Delaying preemption of “best offer” Defenders until after Challenger final action is key to upholding Reservation Priority. It is then necessary to incorporate PTP Challenger timing into the Defender timing considerations along with the TP re-evaluation.
Standard x001-xx says that a request or reservation shall be excluded as a valid Defender if the preemption of that Defender cannot be completed prior to certain deadlines (e.g., the unconditional time). Examples below are for Daily Firm PTP from Table xx-4. Current Recommendation (Defenders with ROFR preempted before the Challenger): BPA Proposal (“Best Offer” Defenders preempted after the Challenger):
Fri
12am
P&ROFR
Initiated
Tues
8pm
Thurs
Unconditional
Window (1d)
Start of Service
Wed
4hrs
TP ROFR Evaluation
Defender ROFR Submission Window (24hrs)
ROFR Preemption
TP Offer to Challenger
Fri
12am
P&ROFR
Initiated
Tues
noon
Challenger Confirmation Time (24hrs)
4pm
Thurs
Unconditional
Window (1d)
Start of Service
Mon
Noon
Wed
8pm
TP “best offer”
Re-evaluation
4hrs
Challenger REBID
TP Offer to Challenger
Defender ROFR Submission Window (24hrs)
TP ROFR Evaluation
ROFR Preemption (Best Offer)
ROFR Preemption (non Best Offer)
BPA Formal NAESB OS /13/2017