The California Independent System Operator (CAISO) is looking to energy storage as a key resource to avoid a replay of last August’s power outages as it looks ahead to what executives at the grid operator expect to be yet another long, hot summer in 2021.
CAISO estimates that 2,000 MW of storage will come online by this summer and is looking to leverage day-ahead market results to manage storage resources throughout 24-hour timeframes, said Mark Rothleder, chief operating officer. The goal is to “ensure that storage is charged to meet local supply constraints or system evening demand needs during the peak hours,” he said.
Rothleder was one of five CAISO executives, including new president and CEO Elliot Mainzer, who appeared en masse for what was intended as a trust-building exercise during a recent webinar hosted by the Clean Coalition. With Mainzer taking the lead, the message from the group was aimed at acknowledging the problems behind the Aug. 14-15 rolling outages that left thousands of Californians without power, while keeping a focus on changes being made to ensure the lights stay on.
August was a pivotal moment for California, said Mainzer, who stepped into the top job at CAISO in September, after seven years as administrator and CEO at the Bonneville Power Administration (BPA) in Oregon. At the same time, CAISO’s Department of Market Monitoring (DMM) had found “no evidence of market manipulation of strategic generator outages” during the August blackouts, he said.
Mainzer said that going forward, “resource adequacy is job number one. Planning, procurement and operational changes are going to be necessary to enable a reliable transition to a decarbonized power system.”
FERC Order 2222
Details of the plans for summer 2021 were offered in updates provided by Rothleder and others.
CAISO would raise its planning reserve margin — the amount of power available to the system above its peak demand — from 15% to 20%, Rothleder said. That margin will be stretched to include not only the late afternoon peak, but the hours immediately following it — the early evening time period when power from solar tapers off but power demand remains high.
Integration of distributed energy resources (DERs) could be accelerated as CAISO works to comply with the Federal Energy Regulatory Commission’s (FERC) Order 2222, said Anna McKenna, assistant general counsel. While California has led the country in efforts to integrate aggregated DERs into wholesale power markets, McKenna said the FERC order, which requires a level playing field for DERs, would push the state further by lowering the threshold for aggregated DERs from 500 kW to 100 kW.
Integration of transmission and distribution planning is also moving ahead, said Neil Millar, vice president of transmission planning and infrastructure development. “Solutions to address reliability needs have not just defaulted to a conventional transmission wire solution, but (are) either looking at distributed energy resources or combinations of wires and non-wires solutions,” he said.
Millar pointed to projects in Santa Clara and Oakland, both of which will use storage and other DERs to provide sufficient power to meet local needs for high demand and flexibility during future summer heat waves.
CAISO’s Energy Imbalance Market also provided grid support during the heat waves, when imported power from the regional system exceeded exports, according to the DMM. Stacey Crowley, vice president of external and customer affairs, said the regional power market is set to double its membership, from 10 to 20 utilities or other load-serving entities, by 2022, representing 82% of load for the Western Interconnection.
Out of the frying pan
According to a preliminary report released in October, California’s August power outages were the result of the combined impacts of an unprecedented heat wave, lagging resource adequacy as the state transitions to a clean grid, and problems with its day-ahead power market. A final report looking at the root causes of the outages is expected by the end of the year. But the preliminary report — issued by CAISO, the California Public Utilities Commission and the California Energy Commission — raised concerns from a range of stakeholders.
For example, Ted Ko, vice president of policy and regulatory affairs at commercial storage developer Stem, has argued that regulatory restrictions on behind-the-meter storage meant that his company had to limit the emergency support services it could provide to the grid.
In an interview with pv magazine shortly after the outages, Ko said Stem had about 100 MW of power across its entire commercial storage fleet but was only able to use about half to ease stress on the grid. When questioned on the situation during the webinar, Rothleder had no easy answers, but said CAISO would “look forward to the opportunity to figure out how to harvest that capacity.”
Before leaving BPA, Mainzer’s colleagues there joked that he was heading out of the frying pan into the fire. At the time, he recalled, he had tried to downplay the analogy, but the wildfires and heat storms of August and September served as an abrupt reality check.
To his credit, during the webinar Mainzer did not dismiss or react defensively to criticism leveled at his agency, and seemed sincere in his commitment to listen and learn from CAISO’s broad range of stakeholders. He might not always agree with them, he said, but called for “fact-based and intellectually honest analysis” of all issues.
“We need to look across the entire regulatory, commercial and operational drive train to ensure that resources can participate on a fair and rational basis,” he said. That would hold true whether they are embedded within the distribution system or actively participating in the wholesale energy market.
*Article updated 12/14. Due to a transcription error, Elliott Mainzer was incorrectly quoted as saying that the August rolling blackouts were a “mistake.” Instead, he said they were a pivotal moment for California.
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