Renewable integration market and product review phase 1

While protecting system reliability, state policy requires the ISO integrate more renewable energy into California's wholesale energy market. Renewable resources operate with inherent output variability, making forecasting an important and challenging consideration. Further, renewables integration requires additional operational capabilities, including additional ramping support and ancillary services and increased ability to manage over-generation conditions. Renewable energy also imposes new operating requirements, such as more frequent starts and stops and cycling of existing generation units. The ISO wholesale market redesign in 2009, along with additional planned changes for 2010-2011, improve the ISO's ability to optimize the use of existing resources and generate market-driven prices that support investment in renewable resources. The ISO is confident that the system is capable of supporting 20% renewables integration. However, as we move toward 33% RPS, we need to examine further market design changes.