CAISO Board gives go-ahead for EIM negotiations with PacifiCorp

For immediate release: March 20, 2013

FOLSOM, Calif. – The California Independent System Operator Corporation (ISO) Board of Governors today authorized the ISO to move forward with negotiating a formal agreement with PacifiCorp for a joint real-time energy imbalance market (EIM).

The ISO and PacifiCorp announced the potential EIM partnership last month and explained it will optimize available energy supplies by providing frequent and automatic dispatching that takes into account resources across the entire EIM region. Without an EIM, only generation assets within each balancing authority can be used to cover short-term gaps in generation resources. The EIM could become operational in October 2014.

The EIM would be facilitated by the ISO. PacifiCorp, which controls two balancing authorities covering portions of six states, including part of Northern California, is not joining the ISO and would maintain control of its assets and responsibilities for serving its customers. A joint report on the EIM benefits released last week demonstrates benefits for both PacifiCorp and ISO customers. The combined savings are estimated to range from $21 million – $129 million by 2017.

“The report shows that an EIM partnership between the ISO and PacifiCorp provides a low-cost, low-risk means of achieving significant benefits for consumers,” said ISO Board Chair Bob Foster. “I want to thank PacifiCorp for pursuing this regional collaboration with the ISO because the West is more likely to achieve efficient renewable integration by sharing resources and leveraging geographic diversity.”

Stakeholder comments regarding the potential EIM can be located at this link. Here are highlights from the letters of support sent to the Board ahead of today’s meeting:

“We look forward to realizing the benefits and highly encourage other balancing authorities in the Western region to enter into similar relationships, creating a more efficient western transmission grid.” Robert B. Weisenmiller, Chair, California Energy Commission and Michael R. Peevey, President, California Public Utilities Commission.

“We are encouraged by the decision of the ISO and PacifiCorp to pursue a partnership. We see this as a pivotal development that could spur more coordination and more effective grid management across the entire region to the benefit of all ratepayers.” Susan Ackerman, Chair, John Savage, Commissioner, and Steve Bloom, Commissioner, Oregon Public Utility Commission.

“With the dramatic increase of wind and solar resources in the West, a coordinated effort to reduce the quantity of required balancing reserves while improving reliability is critical. Iberdrola Renewables applauds PacifiCorp and the ISO for taking this important step forward to lead the region toward a more effective balancing solution.” Kevin Lynch, VP External Affairs, Iberdrola Renewables, LLC.

“The possibility of a real-time balancing energy market that further transcends the historical CAISO footprint is an exciting opportunity that may eventually include other neighboring balancing authorities in the western states and produce significant market efficiencies. WPTF applauds the CAISO and PacifiCorp for demonstrating leadership on this issue.” Gary Ackerman, Executive Director, Western Power Trading.

While not included in the report’s analysis, enhanced grid reliability and renewable integration are additional benefits that come from an EIM. These types of benefits were recently outlined in a FERC staff paper “Qualitative Assessment of Potential Reliability Benefits for a Western Energy Imbalance Market.”

The EIM negotiations now given the green light do not preclude other similar discussions with industry groups in the West and both parties remain supportive of efforts to broaden participation in this or similar regional energy imbalance markets in the future.