Excess Northwest hydropower could flow more freely across the Western United States after the Bonneville Power Administration on Sept. 27 finalized its decision to join the Western Energy Imbalance Market, or EIM, a growing real-time electricity exchange managed by the California ISO.
"This decision aligns with Bonneville's strategic plan and opens up an opportunity to increase revenues through additional sales of surplus power and to reduce costs through greater efficiencies," John Hairston, administrator of the agency, known as BPA, said in a statement. "As the West moves rapidly to decarbonize the grid, Western EIM participation will help us navigate future challenges and leverage opportunities to benefit our customers and the Northwest."
After several years of consideration, BPA plans to join the market in March 2022, pending approval from the Federal Energy Regulatory Commission. The Portland, Oregon-based federal agency began exploring EIM participation while under the leadership of former Administrator Elliot Mainzer, who left BPA in 2020 to become CAISO's president and CEO.
BPA's sprawling portfolio of 31 hydroelectric dams in Oregon, Washington, Idaho and Montana — with a combined maximum capacity of 22,442 MW — and roughly 15,200 circuit miles of transmission build the backbone of the region's power supply system.
While BPA's service area already extends into the Southwest, joining the EIM marks a significant milestone in the effort to better coordinate and integrate the West's highly fragmented power grid. This summer, CAISO and BPA were on opposite ends of an argument before FERC over access to excess resources in the Northwest ultimately decided in favor of California. The issue highlighted the increasing competition for the region's hydropower reserves amid a severe drought that has taken a heavier toll on hydro plants in the Southwest and exacerbated grid reliability concerns.
Now both grid operators are looking forward to closer cooperation.
"Western EIM participation is a great introduction to emerging markets in the West," Hairston said. "We hope to build on this experience to assess future market-based opportunities."
"Bonneville and its public power customers are highly valued partners for the ISO, and we look forward to further strengthening our working relationships," added Mark Rothleder, CAISO's COO.
Earlier this year, the EIM expanded its footprint by adding the Los Angeles Department of Water and Power, the Western Area Power Administration's Sierra Nevada region, PNM Resources Inc. subsidiary Public Service Co. of New Mexico and NorthWestern Corp.
Launched in 2014, the EIM has created $1.42 billion in benefits for its members through the first half of 2021 while helping to better utilize available renewable energy and reduce greenhouse gas emissions, CAISO said in August.
