Dive Brief:

• Portland General Electric (PGE) and the California Independent System Operator (CAISO) filed an implementation agreement with the Federal Energy Regulatory Commission (FERC), the first step in allowing the Oregon utility to share resources in the western Energy Imbalance Market (EIM).
• The western EIM, which includes California’s investor-owned utilities and Warren Buffett-owned PacifiCorp utilities, is expanding quickly. Nevada’s NV Energy will enter as of December 1, 2015, Washington’s Puget Sound Energy and Arizona Public Service will join next year.
• CAISO uses its advanced automated market systems to do 5 minute and 15 minute dispatch of the lowest-cost electricity available in its wholesale market to meet participant load serving entities’ needs when supply and demand do not match. The EIM optimizes renewables consumption by making excess generation available to the system that would otherwise be curtailed.

Dive Insight:

For decades, individual balancing authority areas (BAAs) in the Western U.S. operated independently to keep load and generation balanced. In the East, grid operators developed interlocking systems with shared resources that make reliability a much easier lift. The energy imbalance market in the West looks to mimic some of those capabilities, allowing utilities to trade power over the bounaries of balancing authorities.

CAISO has been operating the imbalance market since November 2014 and now has plans that cover California, Oregon, Washington, Utah, Idaho, Wyoming, Arizona, and Nevada. Its access to widely dispersed resources has begun reducing fossil fuel use in favor of low-cost renewables, saving utilities and consumers money.

PacifiCorp and the ISO saved a combined $21.4 million over the EIM's first eight months of operation. A recent Energy and Environmental Economics analysis showed PGE’s access to the western EIM's larger and more diverse resource mix would significantly lower the utility’s cost of producing and supplying power. Other utilities have seen milions in savings as well:

In PGE’s current integrated resource planning, it weighed participation in a similar Northwest PowerPool initiative. Other western utilities’ decisions convinced PGE the California-based and Buffett-backed EIM was the better choice.