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NV Energy Enters the Western Energy Imbalance Market

December 18, 2015 By Cheryl Kaften

The California Independent System Operator Corporation (CAL-ISO) and NV Energy announced on December 1 that the Nevada-based utility had successfully begun participating in the western Energy Imbalance Market (EIM).

“We welcome NV Energy’s entry into the western EIM,” said CAL-ISO CEO Steve Berberich, adding, “The real-time energy market is already generating significant cost savings, and NV Energy’s participation is expected to add to those benefits while incorporating more clean energy into the grid.”

The EIM is projected to result in more customer savings by using the lowest-cost energy while optimizing the use of clean energy sources, like solar and wind, to meet changes in demand. In its first 12 months of operation, the real-time market produced more than $33 million in cost savings for PacifiCorp, the first EIM participant, and the independent system operator, CAL-ISO reported. Those savings are projected to increase as more utilities join the EIM.

NV Energy CEO Paul Caudill said “I am … confident this work will be good for Nevada, as all resulting cost benefits will flow directly to our customers.”

With the addition of NV Energy, the EIM expands into Nevada, where the utility serves 2.4 million customers. PacifiCorp’s EIM participation serves customers in California, Washington, Oregon, Idaho, Wyoming and Utah.

The newly expanded marketplace enables CAL-ISO and participants to incorporate thousands of megawatts of variable generating resources, such as wind and solar, into the power grid while reducing greenhouse emissions, and improving grid resiliency and reliability, the system operator said.

The ISO and NV Energy have prepared for the utility to join the market for nearly a year, including extensive testing of operations and interfacing in the last two months. The ISO’s state-of-the-art software analyzes western grid needs every five minutes and automatically finds the lowest-cost generation to meet demand.

An independent benefits study found that, by participating in the EIM, NV Energy could save from $6 million to $10 million per year by 2017, and nearly $12 million annually by 2022, CAL-ISO said. Total additional benefits to other EIM participants will range from $9 million to $18 million per year by 2017, and as much as $29 million annually by 2022. A 2013 study by the National Renewable Energy Laboratory found that an EIM with participation of all western states could cut electricity production costs by $1.3 billion a year.

Puget Sound Energy of Washington State and Arizona Public Service, based in Phoenix, Arizona, expect to begin participating in the western EIM in October 2016. Portland General Electric is scheduled to begin participation in October 2017.

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