FERC Accepts CAISO EIM System Functionality Enhancement Proposal

On February 14, 2018, FERC accepted a suite of system functionality enhancements to the Energy Imbalance Market (“EIM”) proposed by the California Independent System Operator Corporation (“CAISO”).  The enhancements, which became effective the following day, included automated matching of import/export schedule changes between resources inside and outside the EIM, as well as allowing EIM entities to use CAISO’s settlement process to address base energy transfer differences.  As CAISO explained in its proposal, the requested enhancements will improve the EIM overall, as well as facilitate the entrance of Powerex Corp. and Idaho Power Company into the market on April 4, 2018.

CAISO’s EIM is a real-time market for imbalance energy that began with a collaboration with PacifiCorp in November 2014 but has since expanded to include numerous other balancing authority areas across the Western Interconnection. On December 15, 2017, CAISO filed the present set of proposed system enhancements to improve the functionality of the EIM.  In particular, CAISO proposed a new tariff provision to automatically match post-market closure EIM intertie schedule changes with nonparticipating resources in order to increase the balancing options available to EIM entities.  CAISO also proposed various changes to improve market modeling of non-participating resources and non-generator resources, as well as to allow the use of CAISO’s settlement process for settling imbalance energy resulting from changes in base energy transfers between EIM entities—a proposal that would, as CAISO argued, reduce the burden of the EIM entities’ own settlement process.

FERC approved each of CAISO’s proposals.  As FERC found, the proposed tariff revisions will make the EIM function more efficiently and effectively, and will provide greater transparency and increased participation of resources in both that market and in CAISO’s other markets.  FERC granted CAISO’s request that the proposed revisions become effective February 15, 2018.

A copy of FERC’s order can be found here.

This article originally appeared on the Washington Energy Report, hosted by Troutman Sanders, LLP.

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