November 13, 2024
CAISO, WEM Boards Approve Pathways ‘Step 1’ Tariff Amendments
Changes Include Revising Language to Elevate WEM Governing Body’s Authority
NW Energy Coalition
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CAISO’s Board of Governors and WEM Governing Body approved ISO tariff amendments needed to implement the West-Wide Governance Pathways Initiative’s “Step 1” proposal.

CAISO’s Board of Governors and Western Energy Markets (WEM) Governing Body on Nov. 8 approved ISO tariff amendments needed to implement the West-Wide Governance Pathways Initiative’s “Step 1” proposal, which would refine four key characteristics in the governance documents and the tariff.  

The proposal seeks to elevate the power of the Governing Body by granting it “primary” authority over rule changes affecting CAISO’s Western Energy Imbalance Market (WEIM) and Extended Day-Ahead Market (EDAM), compared with the “joint” authority it currently shares with the ISO board.  

The tariff amendments will modify the markets’ dispute resolution process to include a dual filing option and augment language considering the public interest. (See CAISO, WEM Boards Approve Pathways ‘Step 1’ Plan.)  

When they approved the Step 1 proposal in August, the ISO and WEM boards directed CAISO to prepare revisions to governing documents for later approval. Implementing the changes would require amendments to three governing documents and a section of the tariff.  

Changes to the charter for EDAM and WEIM governance include:  

    • Adding refinements to the mission of the WEM Governing Body as it relates to considering the public interest and respecting state and local authority.
    • Revising the process for approving tariff amendments within the shared authority from the joint authority to the WEM Governing Body having primary authority, with approved amendments being placed initially on the consent agenda of the ISO board. 
    • Revising the dispute resolution process to add a dual filing with FERC as a possible means of resolving a sustained disagreement between the two bodies. 
    • Adding that the WEM Governing Body may initiate a review of governance if a majority of EDAM entities announce plans to leave EDAM.

Section 6 of the charter, which established the WEM Body of State Regulators, will be amended to clarify that the BOSR can provide opinions to FERC regarding any proposed tariff amendment within the scope of the Governing Body’s authority.  

Additionally, references to “joint authority” will be revised to say “primary authority” in the corporate bylaws and decisional classification guidance for the WEM Governing Body. Tariff language also will be amended to enable dual filing.  

The changes won’t occur until a trigger mechanism is enabled, which is achieved when utilities outside of CAISO’s balancing authority area representing equal to or greater than 70% of the ISO’s load have executed EDAM agreements. To avoid uncertainty about when the changes go into effect, management added a step that requires revised documents to become effective upon certification by the ISO’s CEO or COO.  

While the trigger isn’t expected to be enabled until sometime in 2025, the ISO seeks approval of the changes now to allow time for FERC to issue an order on a tariff amendment.

CAISO Board of GovernorsEDAMWEIM Governing Body

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