(BRK.A), (BRK.B)
Berkshire Hathaway Energy’s participation in the western Energy Imbalance Market continue to meet projections. The company has two utilities, NV Energy and PacifiCorp, participating.
According to the California Independent System Operator (ISO), total benefits realized in the 2015 fourth quarter were $12.29 million, which increases the total benefit since the November 2014 EIM launch to $45.7 million.
These benefits accrue to all EIM participants and their customers, as well as the ISO.
The totals are in line with initial projections and as expected, increased participation benefits all EIM participants. Benefits for October were $2.51 million, down slightly from the summer months because of reduced transmission capacity resulting from a line outage.
With the line restored to service, benefits increased again in November to $3.49 million. With NVE’s entry into EIM in December, the benefits jumped to $6.29 million, including $840,000 that accrued to NVE and its customers and also additional benefits to PacifiCorp and ISO customers because of NVE’s participation and additional transfer capability that they bring to the EIM operation.
NV Energy entering the real-time market in December 2015 produced significant benefits because their participation increases transfer capability between the participants. Interregional transfers enabled in EIM allows each balancing area to take advantage of lower cost resources in other areas.
Besides the benefits produced by interregional transfers, savings were also realized by avoiding having to reduce renewable resources’ output in the ISO control area during times of oversupply. The total avoided energy reduction for Q4 was 17,573 megawatt hours, which greatly outpaced the avoided reductions of 828 megawatt-hours in Q3. Avoiding the renewables output reductions in Q4 displaced an estimated 7,521 metric tons of carbon emissions.
About the Energy Imbalance Market
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. The only real-time energy market in the Western U.S., advanced ISO market systems automatically balance supply and demand for electricity every fifteen minutes, dispatching the least-cost resources every five minutes.
© 2016 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.