The Bonneville Power Administration has signed a Western Energy Imbalance Market (EIM) Implementation Agreement with the California Independent System Operator that signals the beginning of work on projects that need to be completed before BPA can start EIM operations.
At the same time, BPA issued a record of decision that addresses numerous policy issues and topics related to its participation in the EIM.
The BPA in June issued a letter to the region in which BPA described the business case and legal authority for joining the Western EIM, as well as what it said are important related policy proposals.
BPA on Sept. 27 said it expects that the dispatch benefits of the Western EIM will quickly pay for both the startup and ongoing costs of participation and result in annual net benefits of $29 million to $34 million a year. The Western EIM will also provide tools and capabilities to increase the efficiency of BPA’s transmission operations and more effectively mitigate congestion along transmission corridors, BPA said.
BPA said that current market designs do not sufficiently compensate generators for their flexible capability. The ISO has signaled its support for market enhancements to address these issues through an effort to develop market opportunities for capacity and flexibility. BPA is involved in these efforts and expects the ISO to develop and implement these opportunities in the next few years.
Since the summer of 2018, BPA has conducted a robust stakeholder engagement process to determine whether to sign the implementation agreement and to identify many of the issues and concerns addressed in the record of decision.
In the next step of the stakeholder process, BPA will address a set of policy decisions that need to be made about how BPA plans to implement the Western EIM in its operations, transmission tariff and rates. BPA plans to initiate these conversations this fall.
BPA will issue a closeout letter in late 2021 that will determine whether participating in the EIM aligns with the EIM participation principles set forth in the record of decision issued Sept. 27.
A public comment period will follow the letter and the process will conclude in the fall of 2021 with a final decision on whether BPA will join the Western EIM.
WAPA, Basin Electric and Tri-State G&T to join SPP EIM
Basin Electric Power Cooperative, Tri-State Generation and Transmission Association and the Western Area Power Administration on Sept. 9 announced their decision to join the Southwest Power Pool (SPP) Western Energy Imbalance Service (WEIS) market.
SPP said that when it launches the WEIS in February 2021, it will become the market administrator for these and potentially other utilities in the west. The market will centrally dispatch energy from these participants throughout the region every five minutes.
Public power utilities, IOUs study joining western energy market
Meanwhile, public power utilities Colorado Springs Utilities and Platte River Power Authority on Aug. 30 were joined by investor-owned utilities Xcel Energy and Black Hills Energy in announcing that they are evaluating the opportunity to join an EIM. They have launched an in-depth study to determine the best course of action.
Xcel Energy, Black Hills Energy, Colorado Springs Utilities and Platte River Power Authority have secured an independent consultant, which is evaluating the benefits and costs associated with the utilities’ participation in one of two markets -- the WEIS proposed by SPP earlier this year or the existing Western EIM, operated by CAISO.
The study will help the four utilities evaluate which option would provide the most benefit to customers.
Currently, the four energy companies share resources and balance demand for electricity during peak periods through a joint dispatch agreement.