PVcase Prospect's Power Market Analysis assesses project financial viability, providing historical locational marginal pricing (LMP) and node-to-hub basis risk. This data helps you identify the most profitable interconnection points, de-risk profitability, and offer an advantage in early PPA negotiations.
What is Power Market Analysis?
Power Market Analysis is a critical feature within PVcase Prospect designed to help you understand the energy market landscape and target the most profitable areas of the grid. It integrates essential market insights with interconnection and land analysis for holistic early-stage site selection.
How does it relate to LMP data?
While locational marginal pricing (LMP) — the wholesale price of electricity at a specific grid node — is the foundation, PVcase’s Power Market Analysis is a comprehensive solution that goes beyond raw data.
It includes:
- Aggregated historical LMP metrics, such as total averages, solar weighted node averages, min/max spreads (for storage analysis), negative price hours, or download granular LMP data for additional financial modeling.
- Basis risk analysis: A critical calculation that shows the difference between the nodal price (where your project connects) and the hub price (often used for PPA settlement), helping you uncover financial risk.
Why is it useful?
This analysis is essential for de-risking projects and maximizing financial returns. By evaluating historical pricing trends, basis risk, and curtailment potential (measured by negative price hours) early on, you can:
- Avoid sunk costs: Eliminate time and resources spent on sites that are structurally unprofitable, and evaluate tradeoffs with interconnection and land.
- Maximize profitability: Target the most financially viable regions and nodes from day one.
- De-risk PPAs: Understand potential financial exposure from node-to-hub basis risk before signing contracts.
- Consolidate tools for holistic decision-making: Replace multiple separate solutions without cutting corners on quality.
It is highly recommended that you evaluate market potential early on in the site selection process:
Data quality and coverage
PVcase Prospect's Power Market Analysis uses data powered by Yes Energy.
Compared to most LMP providers, this data is much more comprehensive and accurate, and offers the following key advantages:
- Comprehensive nodal pricing coverage: Most LMP providers do not provide data for all nodes. We cover all nodes — tradable or not — because developers need the closest price node to their project for the most accurate pricing analysis.
- Geographic accuracy: Yes Energy has the most accurate ISO data and a team of 20+ experts dedicated to ensuring all price nodes are accurately mapped and that newly energized nodes are promptly added. This gives developers confidence that their historical nodal analysis reflects the correct physical price points, without relying on suboptimal proxy nodes.
- Data integrity: ISOs frequently change how they publish and revise prices. The data operations team continuously collects all LMP data for all nodes and manages price revisions, ensuring historical accuracy and completeness.
Understanding the key metrics
PVcase Prospect provides three years of aggregated, geographically accurate historical nodal pricing data from all available US nodes. The platform automatically calculates and visualizes key metrics to help you make informed decisions.
The following table explains these metrics, detailing their function and how to best utilize them in each use case:
| Metric | Purpose and calculation method | Optimal value per use case (project/role) |
|---|---|---|
| Total Average LMP (Node) | Understand the total average price at a specific node. We average 5-minute pricing data from the ISO over the course of 1-3 years. |
Data center developers should target nodes with low prices (cheap energy). Generators should target nodes with high prices (get paid at high price). Solar generators may want to look at Solar Weighted Average instead (see below). Also evaluate basis risk if planning for hub-settled PPAs. |
| Solar Weighted Average LMP (Node) | A more accurate average price for solar developers, weighted based on production hours (average nodal price weighted by solar irradiance). |
Utility-scale solar generators want to target a high price (get paid at a high price). Also evaluate basis risk if planning for hub-settled PPAs. |
| 4-hr Min/Max Spread (Node) | Identifies optimal locations for battery energy storage (BESS) arbitrage (buy low, sell high). Price spread between the four consecutive lowest priced hours and four consecutive highest priced hours. | BESS developers should target nodes with the highest spread (charge up battery when energy is cheap; discharge when energy is expensive). Hybrid developers need to look at both LMP price (either total or solar weighted) in conjunction with min/max price spread to make sure node works for both generation and battery storage needs. |
| 12 by 24 LMPs (Node) | Download granular “12x24” LMP data for hourly pricing for each month of the selected year to conduct detailed financial modeling and analysis. |
|
| Basis Analysis (Node-to-hub) | Identify nodes with better value relative to hubs, enabling smarter site selection and reducing financial risk for hub-settled PPAs. Basis $ amount = Nodal price - hub price |
Generators: Financial risk increases if nodal price is far below hub price. Target positive basis $ value. Data center: Financial risk increases if nodal price is far above hub price. Target low or negative basis $ value. |
Learn more