The CAISO Board of Governors and Western Energy Imbalance Market (EIM) Governing Body on Thursday approved changes to the EIM’s governance structure involving the selection of Governing Body members, stakeholder engagement and other matters.

The changes, recommended by the EIM’s Governance Review Committee (GRC), do not include the GRC’s more controversial proposal to give the Governing Body greater joint authority with the board over market rules. That measure will be considered separately. (See Joint CAISO-EIM Authority Debated in West.)

“We decided to move forward with finalizing some of the recommendations … and taking more time to engage with stakeholders on the delegation-of-authority topics before finalizing those recommendations,” said GRC member Andrew Campbell, executive director of the Energy Institute at the University of California, Berkeley, Hass School of Business.

Campbell, who presented the GRC’s proposal to the joint meeting of the Governing Body and the board, said the committee is aiming to bring its joint authority proposal to the bodies in June for a vote.

The five categories of changes approved Thursday included:

• elevating the representative for the public interest and consumer advocacy groups of the EIM from an advisory role to a voting member of the Governing Body nominating committee;
• allowing the EIM’s Regional Issues Forum to offer opinions on matters that are part of an ongoing stakeholder process;
• recommending that the EIM’s Body of State Regulators consider adding non-voting positions for federal power market agencies and consumer-owned utilities that participate in the EIM; and
• enhancing the Governing Body’s role in market monitoring and market expertise and sharing authority with the board to approve members of CAISO’s Market Surveillance Committee (MSC).

Governor Severin Borenstein said he was concerned that the EIM employing its own experts could prove divisive between CAISO and the EIM. He recommended that the EIM take greater advantage of the ISO’s Department of Market Monitoring and MSC for advice.

“I am disturbed that this is fragmenting rather than building a common community,” Borenstein said, though he eventually voted for the package of changes.

Thursday’s decision was the culmination of a two-year stakeholder process.

The EIM charter, adopted in 2015, required “a review of EIM governance in light of accumulated experience and changed circumstances” within five years. The board and Governing Body adopted a charter for the GRC in June 2019, directing it to develop a proposal for EIM governance refinements. (See CAISO OKs EIM Governance Review.)

The governance review stakeholder process began with an issue paper in December 2018 and resulted in a revised straw proposal by the GRC in December 2020.

Since its inception in 2014, the EIM — a voluntary interstate trading market — has grown to 14 entities with eight more planning to join in the next two years. The market is expected to eventually encompass 83% of load in the Western Interconnection, and CAISO is trying to expand the EIM’s current real-time market to a day-ahead trading platform.

“I applaud the Governance Review Committee’s work to advance a package of consensus recommendations that were unanimously approved at yesterday’s meeting,” CAISO CEO Elliot Mainzer said in a statement Friday. “The Board of Governors and the Western EIM Governing Body recognized the need for governance enhancements to better reflect the growth and evolution of the real-time energy market and the expanding community of utilities committed to greater regional collaboration.”