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Bonneville moves closer to joining California ISO's energy imbalance market

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Bonneville moves closer to joining California ISO's energy imbalance market

The Bonneville Power Administration announced Sept. 27 that it will address numerous policy issues as it weighs prospects of joining the California ISO's Western Energy Imbalance Market, or EIM.

The BPA also signed an agreement with the ISO to begin work on projects that must be completed before EIM operations can start.

However, the BPA will not make a final decision until the fall of 2021 on whether to join the Western EIM. Still, the ISO said the implementation agreement positions the federal-government-owned power agency to join the EIM in 2022.

"BPA is committed to continued open and transparent stakeholder engagement throughout the implementation phases that will lead up to a final decision," Steve Kerns, the BPA's grid modernization director, said in a news release. "We are looking forward to continued engagement as we launch our discussion of policy issues and move into how we will implement the EIM here at BPA."

Since the summer of 2018, the BPA said it has conducted a stakeholder engagement process to determine whether to sign an implementation agreement. The agency announced it has just signed a "record of decision" that identifies many issues and concerns about engaging in the voluntary real-time power market. The BPA wants to preserve its autonomy and retain authority over its power marketing and transmission operations in the Northwest. The BPA operates and maintains about three-fourths of the high-voltage transmission in its service territory in Idaho, Oregon, Washington, western Montana and small parts of five other states.

The BPA said the EIM offers the federal agency an opportunity to market hydroelectric power resources more efficiently across a large geographic footprint. It estimated net annual benefits of $29 million to $34 million, covering both startup and ongoing costs of participation.

Unlike the hourly and day-ahead markets in which the BPA operates now, the Western EIM dispatches generation in the most economic way every 5 minutes, balancing supply and demand across a wide region.

"We have long recognized that an EIM is one aspect of a well-designed energy market, but there is still more work to be done to fully realize the value of our flexible, carbon-free federal generation," BPA Administrator Elliot Mainzer said.

Earlier this year, the BPA announced its intent to explore whether to join the EIM, which uses data and software technology to find and deliver lower-cost energy to meet real-time energy demand across eight western states. It provides regional environmental benefits by integrating increasing amounts of renewable energy, according to the ISO.

The Western EIM continues to gain participants that already include investor-owned and publicly owned utilities and a Canadian power marketing and trading company. Among companies that intend to join between 2020 and 2022 are certain members of the Balancing Authority of Northern California and the Western Area Power Administration's Sierra Nevada Region.