Energy Imbalance Market (EIM)
Dan Dettmer
Board Meeting
February 16, 2011
EIM Description
From the Western Governors’ / EIM Crossroads website: http://www.westgov.org/EIMcr/index.htm:
The proposed EIM is a sub-hourly, real-time energy market tool that dispatches balance energy in an
economical way while maintaining reliability. The EIM will allow for the use of balancing resources and ability
to make economically efficient balancing decisions. Participation in the EIM and all offers into the EIM would be
voluntary. The EIM would not replace the current bilateral energy market, but would instead supplement the
bilateral market with real-time balancing.
The EIM would also allow for more efficient use of the transmission system by determining transmission
availability based on actual flows in real-time, rather than based on OASIS-posted reserved Available Transfer
Capacity (ATC) on scheduled transmission paths.
The EIM may be an important tool to lower costs to consumers, help integrate variable wind and solar
generation, and expand the use of the transmission system.
While the EIM market has similarities to ISOs and RTOs, this proposal does not include implementing an RTO in
the Western Interconnection. The EIM could utilize tools and algorithms that have been successfully
implemented in other markets.
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WIEB / Crossroads
Needs / Goals Summary
• To dispatch resources more economically
while maintaining reliability
• More efficient use of the transmission system
by determining availability based on actual
flows in real-time
– The proposed EIM is a sub-hourly, real-time
energy market tool
• Participation should be voluntary and bilateral
markets should remain intact
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Needs / Goals Summary – cont.
• It should not include implementing an RTO
– Although EIM is a proven tool that has “worked” in other
markets, e.g. SPP
• To help integrate variable wind and solar
generation
– By 2020, state RPS targets in WECC will drive installed
renewables to 70,000 MW compared to 13,000 MW today
– An earlier NREL analysis showed that by 2020 the Western
Interconnection could reduce generation for load following
by 3,100 MW through joint BA balancing efforts
• A similar study for CG by PNNL showed ‘significant’ savings
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Where concept started / coordinating parties:
• WECC
– Mark Maher, EDT Steering Committee Chair;
Michelle Mizumori, EDT Tech. Review Subcommittee Chair
– Market Interface Committee (MIC): Phil Tice, Chair (DG&T)
– Seams Issues Subcommittee (SIS): Steve Beuning, Chair
(Xcel/PSCO)
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Where concept started / coordinating parties – cont.:
• Western Governors’ Association
– Western Interstate Energy Board (WIEB)
• Doug Larson, Executive Dir. / Victoria Ravenscroft, staff
• State Provincial Steering Committee (SPSC)
– SPSC Grid Utilization Work Group /Steve Oxley, Chair (WY PSC)
• Western Interconnection Regional Advisory Body (WIRAB)
» SPSC & WIRAB each contributed $25k to WECC to lead benefit/cost study
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WIEB
http://www.westgov.org/EIMcr/index.htm
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What is EIM?
Excerpts below are from a presentation by Phil Tice on the Efficient Dispatch Toolkit (EDT). The toolkit consists of
two tools: (1) The Enhanced Curtailment Calculator (ECC) aka the “Seams Coordination Tool”, and (2) The EIM.
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What is an EIM? (cont.)
Excerpts from presentation by Steve Beuning:
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EIM – Impacts
Excerpts from presentation by Phil Tice on EDT:
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EIM Relationships
From presentation by Phil Tice on EDT:
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EDT Timeline
2010 -- Apr: The WECC Board agreed to undertake a benefit/cost study. The EDT Steering & Technical
Review committees were created. Sep: WECC briefed CREPC. Oct: 1st workshop. FERC approved
WECC’s 2011 budget.
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Market Operator - Functions
Excerpts from the 1/14/11 Draft Options Paper on EIM:
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Market Operator – Structure
Excerpts from the 1/14/11 Draft Options Paper on EIM:
Options: The Market Operator could be: 1) a new division within WECC; 2) a reconstituted form of
one or more of the existing Subregional Entities (e.g., WestConnect, NTTG, ColumbiaGrid,
Northwest Power Pool); 3) an existing third-party which operates a market; or 4) a new third-party
market operator. The third-party operator could be an expansion of an existing market operator (e.g.,
the California ISO, SPP, MISO, ERCOT, or PJM), an operating division of a major software vendor
(e.g. OATI, Areva) interested in expanding their business, or a new for-profit or not-for-profit entity.
Other Market Operator Issues:
•
Governance – FERC Jurisdictional? / Board structure / Corporate make-up
•
Financing Options – Start-up and ongoing. Allocation of costs and revenues.
•
Exit Provisions – The voluntary nature of the EIM means BAs / TSPs should
have an option to terminate participation over time.
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Footprint Possibilities
Excerpts from the 1/14/11 Draft Options Paper on EIM. Options 1, 3, and 4 include all CG members; option
2 – CG IOUs (Avista & PSE) only.
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Benefits Study
Excerpts from the 1/31/11 presentation by E3; based in San Francisco, E3 also did market design work on RTO West:
Potential EIM
Benefits:
Conceptual Magnitude
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Benefits Study – cont.
Excerpts from the 1/31/11 presentation by E3:
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Benefits Study – cont.
Excerpts from the 1/31/11 presentation by E3:
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Cost Analysis Below are excerpts from slides presented by Utilicast at the 1/18/11 EDT Workshop. The cost analysis is
targeted for completion by 3/31/11. Note: SPP spent $50M for start-up and $20M annually to establish
and operate its EIM.
Market Operator
Cost Categories:
___________________
Market Participant
Cost Categories:
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Additional Observations
• TSP view on some loss of non-firm revenues vs. the
“imputed” transmission charge / revenue received
for “unauthorized” use of their wires
– Same for TCs regarding forgone trading profits on current
market inefficiencies
• Cost / benefit to participant & non-participant
– Cost and revenue allocation among participants
• ColumbiaGrid
– Presently monitoring / attending EDT / EIM workshops,
webinars, technical committee meetings and other related
forums. Reporting and ready to assist as needed
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