Energy Imbalance Market Presented at: The Governor’s Utah Energy Development Summit 2015 Caitlin Liotiris Energy Strategies Power Through Ideas

Key Questions What is an Energy Imbalance Market (EIM)? How does the EIM improve system flexibility and reliability?

Energy Imbalance Market Tool that manages supply and demand imbalances through automatic economic redispatch on an intrahour basis Software allows most efficient resource to be dispatched to meet need Allows utilities to share imbalances during the hour – Reductions in supply in one area can be made up by increases in supply in another – Especially important with variable energy resources (wind, solar)

EIM Footprint Current participants: – CAISO – PacifiCorp Rocky Mountain Power Pacific Power Future participants: – NV Energy (2015) – Puget Sound Energy (2016) Others possible: – Arizona Public Service Company (2016?) – Others?

Absent EIM Entities responsible for managing deviations in supply and demand (referred to as Balancing Authorities or “BAs”): – Start the hour with (what they expect) will be balanced load and generation – Within the hour changes in load, renewable output, unexpected outages cause the BA to redispatch generation – Generally, absent the EIM, manual redispatch takes place within a BAA’s boundaries BA

With the EIM BAs still start the hour with (what they expect) will be balanced load and generation When within hour changes cause a need to redispatch supply and demand is balanced across and between BAs by a Market Operator – Resources are redispatched in the most economic manner feasible BA

EIM Benefits More economical dispatch of generation – Expanded pool of resources (interregional benefits) – Improvements over manually dispatching resources (intraregional benefits) Renewable benefits & use of new technologies – Geographical diversity (variation in renewable output in one regional may counterbalance variation in another region) – Send price signals to new technologies (like storage/batteries) Reliability – Tool provides increased operational awareness across a larger area More efficient use of transmission – Market allows additional use of transmission system

Future Opportunities EIM allows optimization for supply and demand imbalances within the hour – Allows optimization for units that are already running or could start quickly Traditional markets (Independent System Operators or Regional Transmission Organizations) allow optimization in the day-ahead, and hour-ahead timeframes in addition – Allows units to be committed across larger areas – More benefits in optimizing in day-ahead and hour-ahead time frame