Interest in the Northwest’s Energy Dispatch Market Wanes as CAISO’s EIM Gains Momentum
On October 5, 2015, the Balancing Authority of Northern California (BANC) announced its withdrawal from discussions related to developing a centrally cleared energy dispatch market (CCED) in the northwestern United States. BANC, the third- largest balancing authority in California, is the latest in a series of recent departures from the group of thirteen Northwest Power Pool (NWPP) members involved in the CCED discussions. The other withdrawals came in September with Portland General Electric (PGE) and Idaho Power Corporation announcing they will consider participating in CAISO’s Energy Imbalance Market (EIM) instead of the CCED.
While interest in the CCED is waning, the EIM is gaining momentum. In September, PGE and Idaho Power Corporation, which both withdrew from the CCED discussions, began pursing plans to participate in the EIM. In October, CAISO announced that the benefits of the EIM are in line with initial forecasts, totaling $33.4M of benefit for its participants in the first eleven months of operation. In November, NV Energy, the first of three new participants slated to join the EIM over the next twelve months, will begin active participation.
- NWPP members participating in the CCED discussions are expected to make a decision in November about whether they will continue with the CCED planning
- BANC cited transmission access, cost challenges, and loss of other participants as reasons for withdrawing from CCED discussions
- PGE is targeting the fall of 2017 to begin active participation in the EIM
- The EIM currently includes participants across six states, including California, Idaho, Oregon, Utah, Washington, and Wyoming
- NV Energy, Puget Sound Energy, and Arizona Public Service are slated to join the EIM between November 2015 and October 2016
The future of the NWPP’s CCED market is becoming more uncertain as more NWPP members withdraw from the discussions. The CCED faces the additional challenge of overcoming the interest and momentum building up around the EIM, which was established in November 2014 and is already showing the ability to meet the forecasted benefits for its participants. If the members of the NWPP decide not to proceed with the CCED, then the EIM will be the likely beneficiary as more utilities in the Northwest will look to the EIM to help them reduce operating costs and more efficiently incorporate renewable energy resources into their systems.
This report is part of ScottMadden’s Grid Minute series. To view all featured Grid Minutes, please click here.
Contributing Author: Mark LadischView More
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