(BRK.A), (BRK.B)
Two of Berkshire Hathaway’s utilities, PacifiCorp and NV Energy, saved a combined $13.19 million in Q2 2020 through the western Energy Imbalance Market (EIM).
The California Independent System Operator (ISO) has released its western Energy Imbalance Market (EIM) 2020 second-quarter benefits report that shows total savings have reached $1 billion since the market’s launch in November 2014.
In 2014, Berkshire Hathaway Energy’s PacifiCorp agreed to become the first participant in the Energy Imbalance Market. Berkshire’s NV Energy, which serves 2.4 million customers in Nevada, commenced participation on December 1, 2015.
The western EIM platform automatically finds and delivers low-cost energy to serve consumers in Arizona, California, Idaho, Nevada, Oregon, Utah, Washington and Wyoming. Optimizing diverse resources from a large geographic area enables more effective use of carbon-free generation besides reducing costs.
The Western Energy Imbalance Market (EIM), is operated by the California Independent System Operator (ISO), and is averaging $1 million daily combined benefits for the eleven participating utilities.
ISO President and CEO Steve Berberich, who’s retiring from the ISO later this summer, envisioned the western real-time market to optimize resources and integrate high amounts of renewable energy while improving the reliable operation of the grid. “This milestone demonstrates the Western EIM is providing significant operational efficiencies and greater integration of variable resources for its participants,” said Berberich. “As many entities strive to meet the demands of the quickly evolving grid, the Western EIM will continue to be an important market for supporting a cleaner, greener system in the West.”
“This benefits milestone shines a spotlight on the value of regional collaboration,” said ISO Board of Governors Chair David Olsen. “The ISO will build on this momentum, together with its Western EIM partners, to develop even more efficient ways to share resources and improve reliability west-wide, in order to further reduce costs and emissions for all.”
John Prescott, Chair of Western EIM’s Governing Body, said that as the Western EIM continues to grow, so too will the benefits. “The Western Energy Imbalance Market is helping utilities and participants across the West use their energy resources much more efficiently, while reducing costs to their consumers,” Chair Prescott said. “With the EIM slated to see record growth by adding 10 balancing authorities over the next two years, the Governing Body looks forward to seeing the valuable regional coordination grow tremendously.”
With increasing levels of variable resources on the grid, such as solar and wind, there are times when output from these resources exceed demand for electricity. To balance the grid, those resources are often curtailed. Through the Western EIM and regional collaboration, clean energy resources are transferred across a large geographic area to serve demand where needed, leading to a reduction in curtailments for the second quarter of the year by 147,514 megawatt hours (MWh), and 1.24 million MWh overall since 2015.
With the increased generation of carbon-free energy, the cumulative CO2 emissions have been reduced by 533,381 metric tons, or the equivalent of taking 112,141 passenger cars off the road.
Additionally, operators are seeing qualitative benefits from the increased visibility and resource options available, especially during times such as the evening ramp or the variable nature of storm cloud cover.
© 2020 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.