The Energy Markets
The NYISO runs a day-ahead and a real-time market for electricity. In addition, the NYISO handles the scheduling of direct transactions between buyers and sellers (these are known as bilateral transactions).
Roughly 98% of energy is scheduled in the day-ahead market, while the remaining 2% is accounted for in the real-time market. About half of the energy settled in the day-ahead market is scheduled through bilateral contracts.
Key Energy Terms
Most large electric generators require advanced notice to start. By operating a financially binding day-ahead market, the NYISO allows generators to receive operating schedules ahead of time, and provides a financial incentive for them to perform as scheduled.
Because anticipated load, available generation, and system conditions can change from the time the day-ahead market is run, the NYISO operates a Real-Time market to efficiently and economically balance system changes.
The NYISO supports the direct sale of energy bilaterally (between buyers and sellers). While the cost of energy of a bilateral transaction is negotiated outside the NYISO's marketplace, a bid-based system is used to make transmission service available.