This post draws heavily on previous posts that discuss the mechanics of the Performance Factor, which I divide into two independent parts - the MX Factor and the QX Factor. You can find the initial post on the MX Factor here and the two posts on the QX Factor here and here. 

In the last post, we covered how removing the base charge that feeds the Performance Factor from both the policy charges and interest credits clearly shows why PDX is so levered to the illustrated rate assumption.