A new initiative to streamline and expand bilateral trading in the Western Energy Imbalance Market (WEIM) and Extended Day-Ahead Market (EDAM) was launched Aug. 20, marking another important step toward EDAM implementation.

The initiative centers on inter-scheduling coordinator (inter-SC) trades, an optional market feature facilitating settlement of bilateral contracts between scheduling coordinators (SCs).

“As we’ve been going through implementation activities, we’ve seen some requests where there may be potential value in inter-SC trade functionality,” said Milos Bosanac, regional markets section manager at CAISO. “The lift to implement this functionality is not extensive, and it’s something that could be included, if approved, within the broader implementation activity of the EDAM effort for May of 2026.”

According to the straw proposal, SCs in the ISO market can submit an inter-SC trade, which is a settlement service for parties of bilateral contracts to offset ISO settlement charges against bilateral contractual payment responsibilities. Inter-SC trades don’t have an impact on market optimization, schedules or dispatch, and currently are supported in the ISO balancing area, but not in the wider WEIM or future EDAM footprint.

There are three types of inter-SC trades involving energy, ancillary services and the integrated forward market (IFM) load uplift obligation. Trades of energy can facilitate settlement of bilateral power purchases or trades of energy between SCs in the day-ahead or real-time markets and can be made at physical generator locations (PNodes) or at aggregate pricing nodes (APNs).

Ancillary services trades can facilitate bilateral arrangements of regulation-up, regulation-down, spinning and non-spinning reserve ancillary services obligations. These are financial-only trades that are not at defined locations in the real-time market. In the WEIM and EDAM markets, ancillary services are not optimized or settled through the market, and therefore, the ISO isn’t proposing to extend this type of trade to the broader markets.

IFM load uplift obligation trades can facilitate transfer of bid cost recovery obligations between parties based on bilateral contract arrangements. Like ancillary service trades, they do not occur at defined locations and operate only in the real-time market, and aren’t being considered for extension, either.

“We’re also not proposing, at this stage, to extend this type of inter-SC trade to EIM and EDAM areas for a couple of different reasons, primarily that this is really a feature of participation in the day-ahead market so it wouldn’t necessarily be applicable in the EIM,” Bosanac said. “The current structure of settlement of the IFM load uplift obligation in the EDAM is with the balancing area, not necessarily with the discrete loads within that balancing area. So, there might not be much value to this type of inter-SC trade.”

For trades at physical locations, settlements occur based on the locational marginal price at the location, and there is no limit to the number of trades that can occur. But at APNs, only one trade can occur per scheduling coordinator each hour. Some stakeholders took issue with the limit on trades.

“This will not meet WAPA’s requirements,” said Tong Wu, representing the Western Area Power Administration. “We need to be able to have multiple trades because we have multiple customers … so although from WAPA’s side there’s only one SC, on the customer side, there will be multiple SCs that we need to trade with.”

Dan Williams, principal advisor of Western markets at The Energy Authority, shared Wu’s concern.

“WAPA has really defined the need statement very well within its resource portfolio for why this needs to exist and how it can be used,” Williams said. “There’s probably still a little more work.”

The initiative received overall support and is expected to be presented to the ISO Board of Governors and Western Energy Markets Governing Body in early November.