Bonneville Power Administration Moves Closer to Join Western Power Market to Enhance Transmission Reliability, Resource Utilization

The Bonneville Power Administration on July 29 released a draft decision to join the Western Energy Imbalance Market, or EIM, operated by the California Independent System Operator Corp., in March 2022 after a three-year evaluation of the market opportunity. The federal power marketing administration, which sells electricity from 31 federal dams and one nuclear plant to consumers and businesses across eight states, considers joining the market as a way to progress grid modernization and efficient transmission. Participation would also create opportunities to lower costs through improved efficiencies and increase revenues by providing a new avenue to market surplus power.

The EIM, which began operations in November 2014, optimizes resources through an automated system that secures the lowest-cost energy to serve real-time customer demand over a broad region spanning across multiple western states. The system optimizes resources from a larger and more diverse pool, facilitating integration of surplus renewables that may otherwise be curtailed. The market reported a record $101 million in first-quarter benefits for 2021, with cumulative benefits reaching $1.28 billion since its launch. Currently, the market serves 10 states, which include parts of Arizona, California, Idaho, Nevada, New Mexico, Oregon, Utah, Washington, Wyoming, and Montana.

EIM participation would allow the federal power marketer to purchase electricity from other entities in the intra-hour market when that is more economical. Further, customers would have the option to bid their non-federal resources into the market and maximize the value of their own resource flexibility. The initiative would allow for more precise management of congestion, since the market allows for more efficient transmission by dispatching least-cost generating resources within transmission reliability constraints evaluated on a 5-minute basis. Therefore, joining the market would allow customers to enjoy both economic and reliability benefits.

Comments on the draft are due by Aug. 23 with a final decision anticipated by Sept. 30.