Off Peak

Fortnightly Magazine - November 15 2001
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Off Peak

November 15, 2001

Markets Behaving Badly

 

To understand 'gaming,' be a gamer.

DC PSC RFP Technical Consultant for Formal Case (FC) No. 1156

FERC Staff Member: What sort of behavior is wrong?

Charles J. Cicchetti:* I'm not certain. When we tried to understand 'gaming' [in California], we discovered there was underscheduling and underbuying - arbitrage between two markets, the PX and ISO. This arbitraging did not seem so bad until a shortage emerged.

Marji Philips: I hate to say 'gaming' is bad. You want us to be gaming. You want us to make money. Otherwise, you won't have enough generation. As traders, we are the ones who are taking the risks. So you want to give me room to play my portfolio.

Sonny Popowski: You want these folks to be creative, but not gaming. You need something like the infield fly rule in baseball.

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