California power grid OKs mutual sharing of energy with other states

Reuters

Nov 8 (Reuters) - California's power grid operator approveda new market design that will increase reliability and reducecosts by integrating generation resources from utilities outsidethe state to help balance the growing use of intermittentrenewable resources.

Nevada power company NV Energy Inc said in a releaseThursday it plans to seek permission from Nevada regulators tojoin California's new "energy imbalance market" after completingstudies on the benefits of the new market.

The California Independent System Operator, which operatesthe power grid for much of the state, said the energy imbalancemarket, which its board of governors approved on Thursday, willallow power companies, known as balancing authorities, fromacross the West to participate in its real-time energy markets.

PacifiCorp, a unit of U.S. conglomerate Berkshire HathawayInc's MidAmerican Energy Holdings unit, was the firstcompany to partner with the California ISO on the energyimbalance market.

MidAmerican Energy is also in the process of buying NVEnergy and hopes to complete the deal in the first quarter of2014.

PacifiCorp has been working with the ISO to implement thenew market, which is expected to go live on Oct. 1, 2014, theISO said.

PacifiCorp controls two balancing authorities serving morethan 1.8 million customers in parts of six states. The companyoperates as Pacific Power in Oregon, Washington and NorthernCalifornia, and as Rocky Mountain Power in Utah, Wyoming andIdaho.

The ISO said the new market will match energy needs with thelowest cost resources in all participants' service areas, whichis expected to reduce costs while increasing reliability.

Moreover, by having PacifiCorp and possibly NV Energy jointhe energy imbalance market, the California ISO said all of thecompanies will have access to all of their generation to helpkeep their grids in balance as the number of intermittentrenewable resources like wind and solar power increase.

Without an energy imbalance market, the ISO said operatorsgenerally must rely on generation assets within their servicearea for any last minute balancing.

The biggest power companies participating in the Californiaelectric market include units of Edison International,PG&E Corp, Sempra Energy, NRG Energy Inc, Dynegy Inc and AES Corp.

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