UCP appoints interim administrator to clarify role of MSA in electricity market

Last July, Sonya Savage, Minister of Energy, wrote a letter to the Alberta Electric System Operator the pending expiration of the power purchase arrangements that had been established in the mid–1990s. She said that the government was moving to the existing energy-only market, but that they’d received concerns about mandates and roles of the 4 Alberta electricity agencies:

• Alberta Utilities Commission
• Alberta Electric System Operator
• Market Surveillance Administrator
• Balancing Pool

She directed the AESO to examine whether the move to the energy-only market needed any changes to the price floor, the price ceiling, or shortage pricing. She also requested advice on market power and market power mitigation.

The AESO completed their review and submitted it in November. They found that the existing framework should remain efficient and effective and concluded that no policy changes were needed. This determination was based on 19 stakeholder submissions:

• 13 from the power industry
• 4 associations/organizations
• 1 individual
• 1 agency

The review also highlighted opportunities to clarify the role of the Market Surveillance Administrator and its oversight of the electricity market. In response to that, the government appointed an interim administrator yesterday.

Over the next 9 months, this interim administrator is supposed to focus on market surveillance and enforcement.

The person appointed to this position is Derek Olmstead, an economist at the University of Calgary. He has worked with the MSA since January 2019, first as director of capacity market, then director of markets, and currently as director of enforcement. He also served as an economic advisor to the AESO in 2018, and prior to that, another 6 years with the MSA.

In 2018, Olmstead donated $1,000 to the UCP.

The salary for the MSA is between $184,365 and $249,435.