By Robert Mullin
Powerex has signed an agreement with CAISO to become the first non-U.S. participant in the Western Energy Imbalance Market (EIM).
Vancouver-based Powerex markets the surplus generation of parent BC Hydro, Canada’s third largest utility. The company’s role is similar to that of U.S. federal power marketing agencies, such as Bonneville Power Administration and the Western Area Power Administration.
Mexican grid operator El Centro Nacional de Control de Energía (CENACE) last year announced that it was exploring having its Baja California Norte join the market, but it has not yet signed a participation agreement.
Powerex is slated to join the EIM in April 2018, an aggressive timeline compared with other utilities that have signed on to the market. Preparations typically take 18 months or longer, but the company has long experience selling into the ISO’s real-time market.
“Powerex has actively participated in the ISO’s five-minute market since 2005 through a dynamic scheduling arrangement, so joining the EIM is a logical extension of our intra-hour market participation,” Powerex CEO Teresa Conway said in a statement.
Conway noted that Powerex’s participation in the growing EIM footprint will allow the company to engage in sub-hourly transactions across multiple utility service territories, helping to integrate renewables and improve the region’s grid reliability.
With its access to BC Hydro’s ample hydroelectric resources, Powerex is well-positioned to provide EIM participants with the flexible ramping capacity increasingly needed to firm up the growing number of variable renewable resources coming to the region’s grid. That type of resource sharing is touted as a key benefit of the market.
The company also holds transmission rights on lines throughout the West, including the California-Oregon Intertie, a key transfer point between the Pacific Northwest and California. Constraints on that line periodically act as a chokepoint that isolates the PacifiCorp West and Puget Sound Energy balancing authority areas from the rest of the EIM, resulting in prices that diverge from the rest of the market.
Washington’s Puget Sound Energy — whose service area stretches from suburban Seattle to the Canadian border — began transacting in the EIM last October. (See Seattle City Light Signs EIM Membership Agreement.)
Other future participants in the EIM include Portland General Electric (October 2017), Sacramento Municipal Utilities District (April 2019) and Salt River Project (April 2020). CAISO also said that it expects the Los Angeles Department of Water and Power to soon announce a formal agreement to join the market.
