The California ISO has submitted a tariff amendment today, Sept. 19, 2022, to be effective Sept. 20, 2022 to address a market design issue identified by the Department of Market Monitoring (DMM) that affects battery storage resources.
Over the past year, storage resources have become a critical and growing part of the fleet the ISO relies on for reliable operations. Most recently, during the historical heatwave, storage resources played a critical role in supporting reliable operations during the net load peak. Prior to the heatwave, the ISO worked with DMM to address a market design issue that under specific conditions affects the energy bid cost recovery of storage resources awarded ancillary services. Now that the ISO has had some time to return to normal operations since the historic September heatwave, the ISO is submitting this filing to establish a market rule change that removes the potential for adverse market outcomes, whilst the ISO works with stakeholders to explore other possible solutions to address this issue.
In order to ensure battery storage resources maintain a state of charge that meets their awarded ancillary service requirements, the market uses an ancillary services state of charge constraint, which requires a storage resource to charge or discharge to meet its ancillary services award. Earlier this year, the DMM discovered unintended market outcomes where storage resources may receive unwarranted energy bid cost recovery payments when the ancillary services state of charge constraint causes the ISO market to issue an instruction to charge or discharge.
The ISO will discuss the FERC filing during today’s Market Surveillance Committee Meeting scheduled for Sept. 19, 2022 from 1:00 p.m. to 5:00 p.m. During the Energy Storage Enhancement agenda topic the details of the filing and the subsequent stakeholder policy initiative that will be initiated to explore other possible solutions to address this issue will be discussed.
Meeting details
Market Surveillance Committee General Session
Date: Sept. 19, 2022
Time: 1:00 p.m. - 5:00 p.m. (Pacific Time)
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