By Robert Mullin

The recently expanded western Energy Imbalance Market (EIM) provided California a new outlet for its surplus renewable output last quarter, according to CAISO’s quarterly economic benefits report.

The EIM produced $18.9 million in overall financial benefits for its participants during the first quarter of 2016, up from $12.3 million the previous quarter, the report said.

CAISO attributed the increase to the participation of NV Energy, which joined the real-time market in December 2015. The utility’s addition significantly improved transfer capability between the ISO and the balancing areas belonging to PacifiCorp — the EIM’s first participant — creating a more unified footprint. (See NV Energy has Smooth EIM Integration, CAISO Says.)

Despite its key contribution to unifying the market, NV Energy realized just $1.7 million of the gross benefits during the quarter. The largest share — $10.85 million — flowed to PacifiCorp, while CAISO picked up $6.35 million.

CAISO: Exporter

Nested into the report was what could be the most significant development of the quarter: the rise of CAISO as a real-time energy exporter into other areas of the EIM. CAISO has generally been an importer of electricity since the launch of the market in November 2014. NV Energy’s entry into the market expanded transfer capacity between the ISO and PacifiCorp East from 200 MW to about 570 MW.

“A significant level of the energy that was exported by the ISO was renewable generation,” CAISO said.

That data supports arguments for an expanded EIM — and potentially a Western RTO. Advocates contend a larger market is necessary to reduce curtailments of the increasing amount of renewable generation in the West. CAISO estimates that its EIM operation helped it avoid curtailing 112,948 MWh of renewable generation during the first quarter.

“If not for energy transfers facilitated by the EIM, some renewable generation located within the ISO would have been curtailed via either economic or exceptional dispatch,” CAISO said.

The renewable output made possible by the reduced curtailments prevented the emission of more than 48,000 metric tons of CO₂ for the quarter, CAISO estimates. The ISO also speculates that the cut in curtailments also reduced the number of renewable energy certificates retracted, although that benefit was not quantified in the report.

The ISO’s calculations are based on estimated cost savings from EIM dispatch compared with a “counterfactual” case of dispatch without the market. Benefits fall into three categories, including:

• More efficient inter- and intraregional dispatch in the 15-minute and real-time markets;
• Reduced curtailment of renewable energy; and
• Reduced need for flexibility reserves in all balancing areas.

For individual EIM participants, benefits take the form of either cost savings — such as from reduced need for reserves — or increased profits from merchant operations. CAISO’s quarterly report does not break down estimates along those lines.

CAISO says the EIM has benefited participants to the tune of $64.6 million since the market’s 2014 rollout.