PGE, CAL-ISO Agreement Augurs 2017 EIM Entry

by | Dec 3, 2015

The California Independent System Operator (CAL-ISO) filed with the Federal Energy Regulatory Commission (FERC) on November 20 for approval of its implementation agreement with Portland General Electric – the first official step on the Oregon-based utility’s path toward joining the western Energy Imbalance Market (EIM) in October 2017.

CAL-ISO has requested that the commission accept the agreement, effective January 20, 2016, so that the participation plan can proceed on schedule.

The implementation agreement sets forth the terms under which the CAL-ISO will extend its existing real-time energy market systems to provide imbalance energy service to PGE pursuant to the CAL-ISO Energy Imbalance Market tariff. Under the terms of the agreement, PGE will compensate the CAL-ISO for its share of the costs of related system changes, software licenses, and other configuration activities.

PGE recently filed an assessment by San Francisco-based Energy and Environmental Economics, an energy market modeling consulting firm, with the Oregon Public Utility Commission, showing potential cost savings and efficiency gains for PGE and its customers from EIM participation and pooling of flexible reserves among EIM participants. Indeed, the PGE benefits analysis found that the western EIM will provide PGE access to a larger and more diverse resource mix, including the region’s growing renewables portfolio.

The western EIM – a real-time market that went live on November 1, 2014 – creates significant reliability and renewable integration benefits for ratepayers, by sharing and economically dispatching a broad array of resources. ISO advanced market systems automatically balance supply and demand for electricity every 15 minutes, dispatching the lowest-cost resources every five minutes.

“PGE has been working since 2013 to prepare our grid systems to effectively manage variable energy resources and participate fully in a real-time market, such as the western EIM,” said CEO Jim Piro. “We have looked carefully at the alternatives and believe the western EIM provides the best all-around strategy currently available to us for capturing the greatest benefit for our customers.”

PGE is the most recent utility to announce participation in the western EIM. Phoenix-based Arizona Public Service and Puget Sound Energy are set to enter the market in 2016. Nevada-based NV Energy will begin participating on December 1.

“The first year of EIM has been very successful and produced significant cost savings,” said CAL-ISO CEO Steve Berberich, in a joint statement with PGE. “With additional participants, we envision even lower generation costs and more efficient use of clean energy resources. We are pleased that PGE wants to share in those benefits.”

Currently, the EIM automatically dispatches least-cost energy in real time in California, Oregon, Washington, Utah, Idaho and Wyoming.

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