House members express concerns about Energy Imbalance Market

House Natural Resources Committee Chairman Doc Hastings, R-Wash., and the committee’s Ranking Democratic Member, Peter DeFazio of Oregon, sent a letter to Secretary of Energy Ernest Moniz urging him to listen to regional electric customer input before implementing new proposals for the Bonneville Power Administration and the Western Area Power Administration.

The Sept. 10 letter follows concerns expressed by existing Bonneville and Western electricity customers that participation in an Energy Imbalance Market (EIM) could impose costs that outweigh regional benefits. An EIM is an automated tool that aims to balance fluctua­tions in renewable generation and demand. Regional utilities have undertaken a Market Assessment and Coordination Initiative (Initiative) to study the costs and benefits of an EIM. The first phase of the study has been completed but the second has not, the congressmen said in a Sept. 10 statement.

A key question is whether or not an EIM and its participants would be subject to Federal Energy Regulatory Commission jurisdiction – a major point of possible contention for Hastings and DeFazio, who want the studies to be fully completed before any policy decision is made by the Department of Energy.

“We urge you to allow a pending fact-finding Initiative on integrating wind and other intermittent resources to be completed in order to allow the Bonneville Power Administration and the Western Area Power Administration to make sound business decisions on behalf of their existing customers,” wrote DeFazio in the letter to Moniz. “We are particularly concerned that Bonneville and Western may be required by your Department to join an Energy Imbalance Market (EIM) without regard to whether an EIM is in the best interest of the customers and consumers in our region. If an EIM is pursued, it must be done in a way that does not injure long-standing success in crafting regional solutions or lead to the formation of broader electricity market structures that have been repeatedly rejected in the Northwest.”

Hastings said: “The bipartisan nature of this letter speaks volumes that any wind and solar integration scenario needs to prioritize the consumers that have been paying the bills for generations. The Pacific Northwest electricity system has worked for decades because regional interests came together for the betterment of the region and that needs to continue. Any Washington, DC-imposed system will not work for our region and could only raise electricity costs without benefits.”  

The Bonneville Power Administration is one of the largest providers of hydropower in North America, DeFazio noted. “For decades, the Pacific Northwest has been a longtime beneficiary of inexpensive, renewable power that has served as the backbone of our economy,” he said. “The Pacific Northwest is also the second largest generator of wind power in North America. The integration of wind and hydro power requires a unique, northwest solution, not solutions from invisible bureaucrats that would only drive up our rates.”

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.