The CAISO is proposing several changes to the Resource Adequacy framework that will be relevant to generators both within and outside of California. CAISO is in the initial stages of developing their policy changes and it is a good time to voice concerns or offer suggestions before the changes are solidified.  We expect more than one straw proposal in this process, as the CAISO works with stakeholders to develop the appropriate policy solutions. Comments regarding this portion of the proposal are due February 6. CAISO’s proposal:

Import RA:

• Reassess the requirements and rules for specifying the sources behind RA import showings (prevent double counting in meeting EIM resource sufficiency requirements and RA requirements)
• Implement real time bidding requirement for all MWs of import RA – not just those awarded in IFM and RUC (day-ahead market)
• Explore expanding must offer obligation for import RA to 24/7
• Require 15 minute bidding/scheduling for import RA
• Change import RA designations to be resource-specific

Resource Adequacy Availability Incentive Mechanism (“RAAIM”):

• Explore moving RAAIM  from predetermined hours to event-based triggers
• Implement changes that will resolve gaps in current planned outage approval process, including looking at rules that will incentivize submission of planned outages over reliance on forced outages. Two proposed options are under consideration, namely (i) prohibiting resources that are taking planned outages during a month from providing RA capacity, and (ii) authorizing ISO to procure capacity for any days on which resource is on planned outage using standing CSP bids
• Limit exemptions from various levels of RAAIM penalties
• Consider a RAAIM assessment based on both availability and performance. Currently RAAIM does not assess how resources perform in response to ISO dispatch instructions)
• Seek different pricing structures for each type of capacity (i.e., system, local, flexible)

Local Resource Adequacy Needs:

• Consider proposals to allow slow demand response to help meet local RA needs
• Plan to better outline enhancements to the local capacity technical study to inform stakeholders of availability needs within local capacity areas – including providing additional data

Note that CAISO’s straw proposal part 2 will come out in February with additional changes. 

We are happy to provide counsel regarding the impact of the proposed changes on your business and work with you to participate in this process.