The Modesto Irrigation District board of directors unanimously voted to have the district's electric power service participate in the California ISO's western Energy Imbalance Market by 2021.
Modesto owns and operates all or major portions of seven hydropower and gas-fired plants and serves about 123,000 electric customers. It also provides water service in California's Central Valley.
The Energy Imbalance Market, or EIM, is a voluntary, automated real-time energy wholesale market that matches the lowest-cost electricity supply with customer demand. The EIM reported $86 million in savings for its members in the second quarter of 2019 alone and gross benefits of more than $736 million since late 2014.
On Aug. 27 the Modesto board voted to proceed with implementing, administrating and participating in the EIM. The decision follows neighboring Turlock Irrigation District's decision to do the same in May. Both are expected to begin participating in 2021.
Modesto is a member of the Balancing Authority Of Northern California, or BANC, along with the Sacramento Municipal Utility District, or SMUD, the Trinity Public Utilities District and municipal electric utilities of the cities of Redding, Roseville and Shasta Lake, Calif. Modesto will participate in the EIM through BANC.
SMUD in April began full participation in the western EIM. BANC, a joint powers authority, is California's third-largest balancing authority and has been evaluating future participation of its other members in the EIM.
"Joining the EIM will provide MID continued access to the market's diverse, readily-available power resource mix," Modesto General Manager Scott Furgerson said in a press release. "Access to this low-cost, growing pool of resources will also further ensure and enhance service reliability to our customers."
Costs to join are expected to be about $3.3 million, Modesto said, with ongoing annual costs of about $1 million. Participating through BANC will reduce Modesto's costs, it said.
In addition to SMUD, Modesto will join the CAISO, a number of major investor-owned utilities in the West and BC Hydro electricity marketing and trading subsidiary Powerex Corp. as EIM participants.
About 10 other public- and investor-owned utilities expect to begin participating in the EIM in 2021-2022. These include the Los Angeles Department of Water and Power, Salt River Project, Fortis Inc. subsidiary Tucson Electric Power Co. and NorthWestern Corp.
