(BRK.A), (BRK.B)
Two of Berkshire Hathaway’s utilities, PacifiCorp and NV Energy, saved a combined $58.16 million in the third quarter through the western Energy Imbalance Market (EIM).
The Western EIM achieved $301 million in third-quarter benefits, bringing the cumulative benefits attained in the real-time energy market since its inception in late 2014 to $1.72 billion.
The gross benefits for Berkshire’s NV Energy was $18.04 million and PacifiCorp was $40.12 million.
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 record-setting results for the third quarter of 2021 are attributed to above normal temperatures that caused tight energy supplies for much of the West, and the addition of several new entities that joined the Western EIM earlier in the year.
“As we embark on the development of our Enhanced Day-Ahead Market (EDAM), these EIM results are another tangible example of the value of West-wide market coordination,” said California Independent System Operator (ISO) President and CEO Elliot Mainzer. “We look forward to working with our partners across the West to build on this foundation and create even greater economic and environmental value for the people we serve.”
The third-quarter results, which represent gross cost savings calculated from the optimization of market and grid efficiencies, exceeds the $297 million in cumulative benefits for all of 2019, and nearly reaches the $325 million in total benefits attained in 2020.
Since its launch, the Western EIM has deployed sophisticated technology to find and deliver the lowest-cost energy to its members, while enhancing reliability and providing significant environmental benefits through the reduction of renewable energy curtailments during periods of oversupply.
Reducing curtailments leads to lower greenhouse gas emissions because the renewable energy – rather than going unused – can be deployed by other market participants, and may displace power generated using fossil fuels.
The 2021 third-quarter economic benefits for each participant:
(Millions $)
Arizona Public Service $ 24.58
BANC $ 72.52
California ISO $ 54.01
Idaho Power $ 17.76
LADWP $ 23.57
NV Energy $ 18.04
NorthWestern Energy $ 5.16
PacifiCorp $ 40.12
Portland General Electric $ 7.12
Powerex $ 0.92
PNM $ 6.77
Puget Sound Energy $ 6.78
Salt River Project $ 17.78
Seattle City Light $ 3.92
Turlock Irrigation District $ 2.13
Total $ 301.18
© 2021 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.