A number of Berkshire Hathaway’s utilities, including PacifiCorp and NV Energy, has saved millions million so far this year through the western Energy Imbalance Market (EIM).
The California Independent System Operator (ISO) reported that the western Energy Imbalance Market produced benefits of $39.52 million in the second quarter of 2017. The benefits since the western regional market was launched in 2014 now total $213.24 million.
In 2014, Berkshire Hathaway Energy’s PacifiCorp agreed to become the first participant in a new Energy Imbalance Market (EIM) as a way to balance electricity in-flows and out-flows on a regional basis and bring millions of dollars in benefits to participating utilities.
During the most recent three-month period, PacifiCorp saw benefits of $8.81 million, and NV Energy total benefits in April and May were $4.62 million, while June benefits are still pending data verification.
The EIM began financially-binding operation on November 1, 2014, by optimizing resources across the ISO and PacifiCorp’s balancing authority areas (BAAs), which includes California, Oregon, Washington, Utah, Idaho and Wyoming.
The EIM improves the integration of renewable resources and increases reliability by sharing information between balancing authorities on electricity delivery conditions across the entire EIM region.
Portland General Electric plans to enter the EIM in October 2017, followed by Idaho Power and Canada’s Powerex in April 2018. The Balancing Authority of Northern California/Sacramento Municipal Utility District, Seattle City Light and Los Angeles Department of Water and Power will begin participating in April 2019. Salt River Project of Phoenix is slated to enter the market in April 2020.
The EIM’s state-of-art technology automatically optimizes the real-time grid to find low cost energy regardless of its location to serve consumers in California, Arizona, Oregon, Washington, Utah, Idaho, Wyoming and Nevada.
Excess renewable energy in one area can be used to serve demand in another seamlessly and effectively, avoiding turning off clean energy resources when not enough local demand exists to use it. Another benefit comes from reducing the amount of energy flexibility reserves utilities must carry to manage load and supply variability, as they can tap into resources outside of their service area to serve their load at less cost.
During Q2 2017, the western EIM helped improve use of renewable resources that is estimated to have reduced carbon emissions by 28,700 metric tons. These emission reductions were made possible by using 67,055 megawatt-hours of excess renewable energy that otherwise would have been turned off.
“The EIM had another strong quarter,” said ISO President and CEO Steve Berberich. “The western real-time market is a proven platform for utilities to find and use low-cost energy that produces substantial cost savings — and it will only get better with seven more utilities preparing to join the market by 2020.”
© 2017 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.