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.
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.
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Contributing Author: Mark Ladisch
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