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California ISO asks FERC to approve further enhancements to EIM model

The on April 28 FERC to approve more changesto its energy imbalance market to boost functionality and address issues that aroseduring the first year of the market's operations.

CAISOand PacifiCorp launchedthe EIM in late 2014, and NV EnergyInc. began participatingin that market in late 2015. PugetSound Energy Inc. and ArizonaPublic Service Co. are expected to begin participating in October, andtwo other utilities, Portland GeneralElectric Co. and IdahoPower Co., plan to follow suit in fall 2017 and spring 2018, respectively.

FERCin October 2015 approved an initial set of enhancements to the EIM, and those filedApril 28 represent a second phase of changes that will also facilitate the participationof Puget Sound Energy and APS.

The proposedrevisions are rather technical in nature and address a wide range of topics. Oneof the more major changes would modify the way certain congestion costs, referredto as the real-time congestion offset, are assigned to better reflect the contributionof each member to congestion at the interties. Those costs currently are sharedequally between PacifiCorp and CAISO, PacifiCorp and NV Energy, and CAISO and NVEnergy, depending on the intertie location.

Anotherprovision would require CAISO to comply with any EIM entity's request to provideoutage information to the reliability coordinator to avoid an unnecessary duplicationof effort. The proposal would not change the reliability responsibilities of theEIM entity.

Yet anotherproposed change would clarify that the administrative costs included in the defaultenergy bid and start-up cost and minimum load cost calculations for an EIM marketparticipant should include the applicable EIM administrative charges and not thecharges reflected in CAISO's grid management charge.

Otherproposed changes specify that base schedules must include all e-tags for importsand exports, clarify that appropriate market rules must be developed before economicbidding at EIM external interties can be implemented, provide for real-time localmarket power mitigation of EIM transfers on EIM internal interties, and furtherdetail the calculation of the marginal losses.

CAISOsaid it still has not decided how to proceed on the issue of whether to add an EIMtransmission charge. The idea has been controversial, and CAISO said it will continuethe current reciprocity approach until the EIM gains further operational experience.CAISO will "engage all stakeholders in the event this question is consideredin the future," the filing concluded.

FERCwas asked to allow the proposed changes to take effect Oct. 1, and for a rulingby July 1 so it can include all approved functionality in the market simulationfor the participation of Puget Sound Energy and APS in the EIM. (ER16-1518)