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    Market Efficiency - Pricing Framework

    Review of Price Cap, Price Floor and Shortage Pricing

    In order to meet the government’s direction, while also ensuring stability and certainty in the energy-only market structure, the AESO will evaluate the ability of the current pricing framework in the energy market to maintain resource adequacy and economic efficiency in both the short and long term, and explore options to address deficiencies or increase efficiency in the current energy-only market pricing framework. Administrative price mechanisms, such as the current price cap, offer cap and price floor, must be set at levels to allow for efficient market outcomes while also protecting consumers from cost risk.

    Throughout the Pricing Framework engagement process, the AESO will be seeking stakeholder input and feedback on:

    • The current energy-only pricing framework;
    • The AESO’s methodology and analysis to evaluate the pricing framework; and
    • Options to evolve or improve the ability of the pricing framework to maintain resource adequacy and economic efficiency.

    The AESO will take stakeholder feedback into consideration when submitting the requested recommendation to the Minister of Energy in Q3 2020.

    Additional information on the 2020-2021 Plan for Market-Related Initiatives is available here.

    Materials

    If you have any questions, please contact stakeholder.relations@aeso.ca and subscribe to our stakeholder newsletter for updates.