CAISO has revamped its policy initiative roadmap process by categorizing stakeholder initiatives under one of three “critical strategic and tactical objectives” as a way of providing more clarity on the ISO’s most significant policy goals for this year and beyond.
The reorganization of CAISO’s roadmap, which lays out the policy initiatives that the ISO plans to tackle in the next three years and their anticipated timelines in a diagram, was presented at a meeting last week that kicked off the 2023-25 planning process.
“Unlike previous years, we’ve gone ahead and organized the initiatives included in the roadmap … based on what strategic objectives we feel they most closely support,” said Gillian Biedler, CAISO policy integration and governance manager. “Some of them are quite clear. Some of them will support multiple strategic objectives. We’ve organized them that way so that you get a sense of the emphasis for those initiatives and a broader scheme of prioritization.”
The strategic goals mostly revolve around CAISO’s efforts to ensure it has sufficient capacity after three summers of strained grid conditions and to expand its regional presence through the Western Energy Imbalance Market, as well as advancing the state’s transition to 100% clean energy.
One objective is to “reliably and efficiently integrate new resources by proactively upgrading operational capabilities.” Initiatives that fall under that category focus on “improving the modeling of resources to better reflect their economic and physical characteristics,” Biedler said in her presentation.
Among them is CAISO’s Price Formation Enhancements initiative, which deals with issues such as scarcity pricing.
“Scarcity prices are important to attract supply and incent resources to be available and perform,” the ISO says on the initiative’s web page. “They are also important to provide appropriate price signals to reduce demand. Recent energy shortages and associated prices in the ISO real-time market have emphasized the need for the ISO to review and enhance its scarcity pricing provisions.”
Others deal with variable energy resources such as solar power and storage dispatch enhancements, both meant to optimize resource participation in the ISO.
A second objective is to strengthen resource adequacy and to meet the state’s climate goals through long-term transmission planning and effective coordination with state agencies such as the California Public Utilities Commission and the state Energy Commission, which share electricity planning duties with CAISO.
Initiatives dealing with changes to the ISO’s capacity procurement mechanism soft-offer cap and interconnection process enhancements fall into this category; so will processes expected to start next year on transmission planning and extreme weather events in response to FERC directives.
The third objective is to “build on the foundation of the Western Energy Imbalance Market to further expand Western market opportunities.”
The category includes initiatives to refine the rules governing the WEIM’s Extended Day Ahead Market (EDAM), which the CAISO Board of Governors and the WEIM Governing Body approved Feb. 1. (See CAISO Approves Day-ahead Market for Western EIM.)
The ISO’s Day Ahead Market Enhancements initiative and revisions to the EDAM resource sufficiency evaluation test and WEIM governance fall into this category.
The initiative and dozens of others are described in the ISO’s Policy Initiatives Catalog, which is updated twice a year. The 2023 draft catalog was last updated Feb. 16.