California ISO board approves governance framework for expanded EIM

Measures to expand the California ISO’s (Cal-ISO) real-time energy imbalance market (EIM) to outside participants took a step forward on Dec. 18 when the Cal-ISO’s board of governors approved the charter for, and the formation of, a nine-member transitional committee that will give stakeholders a voice in EIM decision-making and advise the board in advance of the ISO integrating its first EIM partner.

“Interest in the EIM has grown throughout the Western Interconnection, requiring a need to develop a structure that will give EIM participants and other regional interests a voice in the EIM decision-making process,” an Cal-ISO spokesperson told TransmissionHub Dec. 20. “It builds upon our current 5-minute imbalance market. It has been expanded to include non-ISO market participants,” though the expanded market will offer 15-minute dispatch to conform with FERC Order 764.

The transitional committee will initially comprise representatives of seven sectors, including investor-owned utilities, publicly owned utilities, generators and marketers, alternative energy providers, EIM participants, government agencies and public interest entities. The charter provides for two additional seats in the event that other entities besides PacifiCorp, to date the only outside entity that has taken the steps necessary to participate, enter into EIM agreements.

“We will begin to take nominations from the different sectors, and they will be brought back to our board for them to choose who to appoint to the committee,” the spokesperson said. A minimum slate of nine candidates will be considered at the ISO board meeting in May 2014. Once seated, the transitional committee will begin work immediately, with its first meeting tentatively scheduled for June 2014.

PacifiCorp and the Cal-ISO on Feb. 12 announced that PacifiCorp would be the ISO’s first EIM partner. FERC approved the implementation agreement between the California ISO and PacifiCorp on July 3. Since then, the parties have been working together to prepare for market implementation, which is expected to take place on Oct. 1, 2014.

PacifiCorp, which is a MidAmerican Energy Holdings company, operates as Pacific Power in Oregon, Washington and Northern California, and Rocky Mountain Power in Utah, Wyoming and Idaho, controls two BAs and serves nearly two million customers.

The expanded EIM will allow balancing authorities (BAs) in the West to voluntarily participate in a real-time energy market “that enhances grid reliability and responsiveness, effectively integrates renewable power and saves wholesale energy costs,” according to the ISO.

The EIM will include a 15-minute market that dispatches across a wide area, automatically identifying and adjusting to find the best resource to meeting fluctuating demand. Currently, non-ISO balancing authorities in the West schedule power hourly.

Costs of participating in the EIM will be allocated between balancing authorities using cost causation principles, the ISO said. In addition, EIM balancing authorities still retain all the operational responsibilities for serving their customers and for maintaining reliability in their areas.

The region will benefit from the expanded EIM in number of ways, according to the ISO, including improved reliability and enhanced renewable integration. The expanded market is also expected to lower wholesale costs through the use of the ISO’s advanced technology that every five minutes automatically finds the most efficient resources to serve customers.

While utilities and other entities have been able to participate in real-time balancing markets in other areas of the country, including the areas served by the Midcontinent ISO and PJM Interconnection, extending the opportunity to entities outside the ISO is plowing new ground.

“None of them extend their real-time balancing markets to non-[ISO] participants,” the Cal-ISO spokesperson said.