Dive Brief:
- Portland General Electric (PGE) will formally explore joining the Energy Imbalance Market (EIM) operated by the California Independent System Operator (CAISO), the utility announced last week.
- The EIM is a real-time, voluntary wholesale electricity market that can dispatch the lowest cost generation to meet short-term changes in demand. PGE is targeting late 2017 for active participation.
- CAISO welcomed the utility's announcement last week, and issued a release highlighting a combined a $21.4 million savings for the grid operator PacifiCorp, the western utility holding company owned by Warren Buffett that joined the EIM earlier this year.
Dive Insight:
CAISO has been operating since November 2014 in parts of California, Oregon, Washington, Utah, Idaho, and Wyoming. It now includes the active participation of the Warren Buffett-owned PacifiCorp utilities, and will soon include NV Energy, Puget Sound Energy (PSE), and Arizona Public Service (APS).
Because of access to a wide geographic dispersion of resources, the EIM has reduced fossil fuel use in favor of low-cost renewables to meet short-term imbalances in supply and demand. PacifiCorp and the ISO saved a combined $21.4 million over the first eight months of operation.
In PGE’s current integrated resource planning, it weighed participation in a similar Northwest PowerPool initiative. Other western utilities’ decisions convinced PGE the Buffett-backed ISO EIM was the better choice.
Nevada’s NV Energy, also owned by BHE, will go active in the ISO’s EIM in November. Washington’s PSE and Arizona’s APS plan to participate by October 2016.
For decades, individual balancing authority areas (BAAs) in the Western U.S. operated independently to keep load and generation balanced. In the East, grid operators developed interlocking systems with shared resources that make reliability a much easier lift.
The millions in benefits to PacifiCorp East (PACE) and West (PACW) and the ISO validate pre-launch estimates and provide confidence benefits predicted for NV Energy, APS and PSE will be realized.
“This is clearly a ‘the bigger, the better’ situation in terms of optimizing the system,” BHE U.S. Transmission President and CEO John Cupparo explained.
