Cal-ISO Board Approves Bundling of DERs for Wholesale Market

New rules and processes approved by the California Independent System Operator (Cal-ISO) Board of Governors on July 16 will enable aggregated distributed energy resources (DERs) such as rooftop solar to participate in the wholesale energy market.

The rules “set a pathway for bundling of smaller resources,” the ISO said – either by utilities or by third parties – so that they collectively meet the half-megawatt minimum requirement for participating in the energy market.

The board clarified that, for purposes of this proposal, a distributed energy resource is any distribution-connected resource – regardless of size or whether it is connected behind or in front of the end-use customer meter. “Examples of DERs include, but are not limited to, rooftop solar, energy storage and plug-in electric vehicles.

“With the rapidly evolving grid and quantum growth in distributed generation, this framework for integrating smaller renewable resources onto the high-voltage grid demonstrates a significant step in redesigning our energy future and helping California meet its clean energy goals,” said Cal-ISO CEO Steve Berberich.

The proposal approved by the board also outlines how DER aggregations would be metered, and allows service providers to act as scheduling coordinators to interact with the ISO through a single point of contact. In turn, the Cal-ISO will have the ability to select a broader array of resources when balancing supply with demand, while integrating more renewables on to the power grid.

Supporting tariff language will be developed and submitted to the Federal Energy Regulatory Commission (FERC) for its approval later this year.

Management proposes to create a pro forma distributed energy resource provider agreement to establish the terms and conditions under which the ISO and distributed energy resource provider will discharge their respective duties and responsibilities under the tariff. This agreement would identify every sub-resource subject to the agreement as part of a schedule to the agreement. Each provider, regardless of how many aggregations it has, will only execute a single agreement. Under this arrangement, individual sub-resources in an aggregation must participate in the ISO market as part of the aggregation and not as individual resources.

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