What is the Day-Ahead market?
The Day-Ahead-Market is where electricity prices are set for each hour the day before that electricity will be used. When you sign up for the Smart Usage Plan or other plans where supply prices are set by the Day- Ahead-Market you might want to know how to find out what those prices will be. (See below for more detail about what the Day-Ahead-Market is.)
The NYISO website has an abundance of energy market information that can be daunting to wade through. There is a page which allows you to select your local load zone and download the prices for a selected date range. Hopefully this step by step process will be simple to follow:
1. Go to www.nyiso.com
2. Select the "Markets" tab from the top
3. Select "Custom Reports' from the listed items under "Energy Market & Operational Data"
4. On the Custom Reports page, scroll down so you can see the box in the middle named "Day-Ahead Market LBMP - Zonal"
5. Click the box marked "Central" to add our local Central Zone to the list on the right.
6. Then chose a start date and end date for the Day Ahead Market prices you would like to download.
7. Then choose the format you would like the report generated in- CSV, Html, or PDF.
8.Then click on "Generate Report" at the bottom of this box.
9. A report will be downloaded by your computer. The chart will have many columns of information. The most important columns are A (the hour of the day) and E (the price per megawatt of electricity).
10.Because the price in Column E is listed in megawatts and you pay your utility bill in kilawatts, you must divide Column E by 1000 to get the hourly kilowatt price.
Going one step further...
Columns F and G contain the relatively small gains and losses for that hour's price which you can choose to include in any calculations but will not make a significant change to the overall price.
If you choose to download a CSV format and use the program Excel to manipulate the data, you can create a formula to divide Column E by 1000 (add in Columns F and G if you want )...
...and generate a chart that shows the hourly price for that time period.
Background on the Day Ahead Market...
Each day, hundreds of thousands of megawatts of electricity are channeled from generating stations through power lines, substations, transformers, and into people's homes and businesses. Since 1999, when New York deregulated its energy system, the New York Independent System Operator or NYISO has been operating our electricity grid and managing the wholesale energy markets. Large power plants of all types sell the energy they produce on wholesale energy markets. Utilities and Energy Supply Companies (ESCOs) purchase bulk amounts of electricity from the NYISO on a regular basis. This electricity is billed to customers as part of their "Supply Charges" which are in addition to "Delivery Charges" that cover the cost of maintaining the power lines and other infrastructure to carry the electricity on the grid.
Like the stock market, the price of electricity changes frequently depending on the supply available and the amount of demand. Utilities and ESCOs purchase electricity on the NYISO markets in a number of ways. Often utilities purchase bulk amounts of electricity with an additional hedge that acts like an insurance policy to protect against big price spikes. Locally, NYSEG has a new rate plan called the Smart Usage Plan where electricity is instead purchased on the Day Ahead Market. On the Day-Ahead-Market prices are set for electricity for each hour of the following day and can reflect the volatility of the market with price spikes as well as dips that respond to the current supply and demand circumstances. Demand for electricity tends to be lower overnight when most of us are sleeping, and tends to be higher in the afternoon and evening when businesses and homes are using a lot of electricity. So the Day-Ahead-Market prices tend to be cheaper overnight and in the morning and more expensive in the afternoon and evenings. Prices can spike dramatically during very cold periods of time, especially if there is a corresponding natural gas shortage (because the price of electricity is connected to the price of natural gas as well as other energy sources), because there is a high demand for electricity to heat buildings. Prices can spike also during heat waves when many people turn on their Air Conditioning to cool off.
Last updated July 26, 2019