Comments on discussion paper

1. Please provide your organization’s feedback regarding the updated DDEMI Discussion paper (which was published on June 13, 2025).

The California Community Choice Association (CalCCA) appreciates the opportunity to comment on the June 13, 2025, updated Demand and Distributed Energy Market Integration (DDEMI) Discussion Paper. CalCCA reiterates its May 1, 2025, comments on the Performance Evaluation Methodology (PEM) problem statements presented at the April 7, 2025, DDEMI Working Group (DDEMI WG) meeting, and provides a response to problem statement 3, regarding device-level measurement. In its May 1 comments, CalCCA took no position on the exploration of device-level measurement (problem statement 3) or device-level registration (problem statement 5) problem statements. CalCCA now expresses support for the DDEMI WG exploring device-level measurement via the stakeholder initiative process, as discussed in more detail below, and continues to take no position on device-level registration.

CalCCA restates its May 1, 2025, recommendations that the California Independent System Operator (CAISO):

• Move the operational details of PEMs from the tariff to the Business Practice Manual (BPM) to allow flexibility for modifying PEMs to be more effective and adding PEMs to support new technologies or processes for monitoring and evaluating performance;
• Include general descriptions of PEM categories in the tariff to ensure compliance with Federal Energy Regulatory Commission (FERC) rules; and
• Work with the California Public Utilities Commission (CPUC) and stakeholders to explore opportunities to allow full export from behind-the-meter (BTM) energy storage and electric vehicles (EVs).

Additionally, the CAISO should address problem statement 3 by exploring the use of device-level measurement in developing baselines for PEM options. The Discussion Paper defines problem statement 3 as, “BTM device-level measurement is not recognized for use in developing baselines for PEM options. Performance evaluations depend on energy measurement (load and generation) and don’t recognize non-energy metered technologies' contributions to load reduction calculation equivalents.”

Because performance at the individual BTM device level is not recognized in developing PEM baselines, the baselines could potentially undervalue their contribution to load reduction calculation equivalents. Without visibility into individual BTM devices, the CAISO cannot accurately determine their performance or forecast short-term loads. In particular, BTM energy storage charging and discharging in response to dispatch instructions could be “hidden” by other loads behind the customer meter and may be more accurately measured by device-level measurement. The DDEMI WG should therefore continue exploring device-level measurement via the stakeholder initiative process to better understand the challenges and opportunities of individual BTM device measurement.

1. Please provide your organization’s feedback regarding the updated DDEMI Discussion paper (which was published on June 13, 2025).

The California Department of Water Resources – State Water Project (CDWR-SWP) appreciates the CAISO’s support in collaborating on the development of the draft problem statement on real-time load bidding. CDWR-SWP also values the CAISO’s engagement with stakeholders and its recognition of the need to enhance real-time market participation for demand-side resources, along with the potential market efficiencies this effort could yield.

CDWR-SWP believes the draft problem statement accurately reflects the challenges and opportunities identified and captures the foundational elements necessary to advance real-time load bidding. CDWR-SWP strongly supports the direction outlined in the problem statement and is encouraged by the CAISO’s commitment to addressing this important issue. We look forward to continued collaboration as this initiative progresses into policy development.

1. Please provide your organization’s feedback regarding the updated DDEMI Discussion paper (which was published on June 13, 2025).

Comments on Demand and Distributed Energy Market Integration Working Group Discussion Paper

Department of Market Monitoring

July 11, 2025

Summary

The Department of Market Monitoring (DMM) appreciates the opportunity to comment on the Demand and Distributed Energy Market Integration Working Group Discussion Paper and presentation dated June 13 and 17, 2025, respectively.[1]^{, [2]} In these comments, DMM adds to our previous comments from the ISO’s Demand and Distributed Energy Market Integration (DDEMI) Working Group Meeting on April 7, 2025.[3]

DMM appreciates the work that is going into the DDEMI effort. However, the ISO has not presented information on the costs and benefits of these enhancements. DMM recommends that an assessment of the effort required for these market improvements should be included in this stakeholder process. Without any such assessment, it appears to DMM these enhancements should have a lower priority than other policy efforts currently underway, such as EDAM congestion rent allocation refinements, congestion revenue rights reforms, storage default energy bids, and uncertainty products.

DMM offers comments on the following four topics:

• The ISO should work toward a long-term goal of modeling demand response resources as participating load. DMM recommends the ISO incrementally work to move demand response from a supply-side resource to a demand-side resource. Further, DMM recommends in this stakeholder process the ISO consider the interactions of this change to long-term planning for resource adequacy obligations, and methods to value the resource adequacy of demand-side resources if they are treated as load.
• Real-time load bidding. DMM supports enhancements to real-time load bidding functionality for load resources that are able to respond to real-time economic signals. DMM recommends the ISO consider the interaction between demand response participating through real-time load bidding and the resource adequacy capacity accreditation of these resources.
• Western Energy Imbalance Markets (WEIM) demand response models. DMM supports expanding the demand response models available to WEIM entities. Real-time load bidding and resource participation are preferred models. However, DMM cautions any model must not allow for double counting of the resource capacity in the resource sufficiency evaluation test.
• Participation model for electrolyzer resources. DMM supports the ISO’s development of a hydrogen electrolyzer resource model that is similar to the storage model, to the extent there are resources that will be imminently participating in the market and require such a model to do so. In developing this model, DMM asks the ISO to carefully consider characteristics unique to electrolyzers that may differ from storage, such as state-of-charge and ancillary service requirements.

Comments

Demand response should be modeled as participating load whenever technologically feasible

DMM believes demand response (DR) should be modeled as participating load rather than as a supply-side resource whenever technologically feasible. Modeling demand response as a real-time demand-side resource instead of a supply-side resource will improve market efficiency by increasing the slope of the demand curve of the market. This will in turn improve reliability and reduce overall system costs by not scheduling uneconomical loads.

DMM recommends an incremental transition to modeling DR as a demand-side resource. Modeling more demand response as participating load is a long-term goal, however, there are considerations to be made in the interim. A near term enhancement could allow real-time participation under the existing participating load model, with future enhancements for other DR participation models as learnings and technological improvements further facilitate the ability to treat a wider range of DR as a real-time demand-side resource.

Modeling DR as participating as load will require additional attention to the interaction with the current capacity planning paradigm. Currently, capacity obligations are determined ahead of time, and with no consideration of market conditions. Adding additional price responsive demand will both modify the long-term forecasted loads used for planning, and the potential capacity (qualifying capacity) of the participating resources. DMM recommends in this stakeholder process the ISO consider the interactions and overlapping policy structures of participating loads, long-term load forecasting for resource adequacy (RA), and the qualifying capacity of resources in the RA process.

Furthermore, in the incremental development of a demand-side DR model, the potential DR model developments discussed in this stakeholder process for WEIM balancing authorities (BAs) could work as pilot programs of this functionality.[4] These improvements are discussed below.

DMM supports enhancements to real-time load bidding functionality

DMM continues to support real-time load bidding functionality for load resources that are able to respond to real-time economic signals.[5] Currently, load can bid economically in the day-ahead market, but all load is served in real-time without regard to price. This is true even for participating load resources that may be willing and able to respond to real-time economic signals to increase or decrease consumption. This is also true for WEIM balancing authorities, which are discussed below. DMM supports real-time bidding functionality, initially for participating load resources, to provide for greater system flexibility and additional slope to the demand curve. This model could then be incrementally extended to additional DR models beyond the participating load model.

The ability to schedule loads in real-time would allow for uneconomical load to not be scheduled or served in real-time, allowing for existing on-line capacity to meet the needs of the system without additional supply. The additional supply could then contribute to reserves for tight conditions, and as a result lower real-time system costs because the market would not be dispatching the next marginal unit.

Western Energy Imbalance Markets

DMM further recommends the ISO extend real-time load bidding functionality to WEIM entities. WEIM considerations are more generally discussed below. At present, WEIM entities have no ability to bid load in real-time, and generation is matched to load forecasts. To facilitate DR participation in the BAs of WEIM entities, real-time load bidding would allow for the BAs to economically schedule loads that could adjust to price signals. The WEIM entity could self-schedule loads that are inflexible, and bid their flexible loads to facilitate prices responsive to DR in their BA. This would be beneficial to the WEIM entities because the price responsiveness would reduce system costs and increase reliability for the WEIM BAs.

Resource adequacy

DMM recommends clarification of the interaction between modeling DR as real-time participating load and resource adequacy accreditation. A participating load resource that has similar bidding requirements to demand response and has verifiable load reductions, should also receive resource adequacy credit (qualifying capacity). DMM understands RA accreditation is within the scope of the local regulatory authority (LRA), but DMM recommends the ISO work with the LRAs to monitor and verify appropriate RA accreditation.

The ISO should expand demand response participation models for use in the Western Energy Imbalance Market

DMM recommends the ISO expand demand response participation models to allow greater DR functionality for the WEIM entities. This extension of DR models could include the ability of WEIM entities to register DR resources, and/or adjust base schedules to reflect DR programs. DMM recommends DR participation models developed for WEIM entities allow the WEIM entities to bid DR programs as participating load in the real-time. 

In the WEIM today, DR can participate on the supply-side using the dispatchable demand response (DDR) model, or as a load modifier that is submitted to the ISO daily. The DDR model offers one pathway to economic real-time participation of DR loads, but DR as a load modifier neither allows the resource to respond to price signals, nor provides robust availability or performance metrics for monitoring and verification of the resource.

WEIM entities have expressed interest in a verifiable method to allow for DR participation in their BAs, but prefer to use their own Performance Evaluation Methodologies (PEMs) instead of established CAISO PEMs. The ISO has indicated consideration of a model for WEIM entities that does not use the current CAISO PEMs. DMM requests the ISO further discuss this model for WEIM DR participation without CAISO PEMs, as the use of less-transparent PEMs could lead to insufficient resource performance to meet demand for the WEIM BA.

To ensure WEIM DR participation does not lead to leaning if there is a lack of generation within the WEIM BA, DMM recommends the ISO consider the interaction of DR participation and the resource sufficiency evaluation (RSE) test. Overall, DMM supports expansion of WEIM DR participation models. However, DMM recommends such models be developed in a manner that ensures DR capacity is not double counted in the RSE test. The concern of double counting is that a registered DR resource may be shown as a resource, as well as an adjustment to base schedules, effectively double counting the load reduction of the DR program. The double counting may foreseeably result in a lack of capacity at the BA level, but not be reflected in the RSE.

Demand response as load in the WEIM

As discussed above, DMM recommends as a long-term goal modeling DR as participating real-time load instead of a supply-side resource. If the ISO were to extend real-time load bidding functionality, and the ability to adjust base schedules to reflect DR programs, the ISO would effectively be treating DR as participating load. DMM recommends this initial step as a viable solution to extending DR participation models to the WEIM, to the extent technologically feasible by WEIM DR resources.

DMM supports development of a participation model for hydrogen electrolyzers if needed that is similar to the storage resource model, but considers technology specific attributes

A hydrogen electrolyzer is a technology that can produce or consume electricity through the joining or splitting of water molecules into their component parts (hydrogen and oxygen). Since the resource can both produce and consume electricity, the electrolyzer is similar to a storage resource. However, electrolyzer technology is not limited to production and consumption of hydrogen, but can be used more generally to create hydrogen that is later used as a fuel source in other technologies, such as combustion to create electricity, or within the transportation industry. To cover both of these cases, DMM supports the ISO plan to develop a general electrolyzer model that is similar to the storage resource model, though with additional considerations specific to this technology. Because development of this new model may take extensive effort by the ISO, DMM supports the development of this new model only to the extent there are resources that will be imminently participating in the market and require such a model to do so. 

While developing the electrolyzer model that is similar to the storage model is logical, fundamental differences should be addressed. An electrolyzer does not have the same concept of a state-of-charge or cycling. This is especially important if the electrolyzer is only producing hydrogen, but then not consuming the stored hydrogen, analogous to a storage resource.

Furthermore, if the electrolyzer is to provide ancillary services, especially regulation, the resource may have differing ancillary service constraints. DMM recommends the ISO work with stakeholders to closely develop a general model for electrolyzers that is similar to the storage model, but considers the unique characteristics of the technology that differ from the storage model.

[1] Demand and Distributed Energy Market Integration Working Group Discussion Paper, California ISO, June 13, 2025: https://stakeholdercenter.caiso.com/InitiativeDocuments/DiscussionPaper-DemandandDistributedEnergyMarket-June13-2025.pdf

[2] Demand and Distributed Energy Market Integration Working Group, California ISO, June 17, 2025: https://stakeholdercenter.caiso.com/InitiativeDocuments/Presentation-Demand-Distributed-Energy-Market-Intgeration-Jun17-2025.pdf

[3] Comments on Demand and Distributed Energy Market Integration, Department of Market Monitoring, May 1, 2025: https://www.caiso.com/documents/dmm-comments-on-demand-and-distributed-energy-market-integration-apr-07-2025-working-group-may-01-2025.pdf

[4] Western Energy Imbalance Market (WEIM) balancing authorities (BAs) include BAs that are in the Western Energy Imbalance Market (WEIM) and the forthcoming Extended Day-Ahead Market (EDAM)

[5] Comments on Demand and Distributed Energy Market Integration, Department of Market Monitoring, February 21, 2025: https://www.caiso.com/documents/dmm-comments-on-demand-and-distributed-energy-market-integration-feb-05-2025-working-group-feb-21-2025.pdf

1. Please provide your organization’s feedback regarding the updated DDEMI Discussion paper (which was published on June 13, 2025).

A. Performance Evaluation Methodology problem statements

CALSSA appreciate the opportunity to provide feedback on the June 13 updated DDEMI Discussion paper, and.appreciates the work of the CAISO staff to formulate and refine problem statements for Performance Evaluation Methodologies. We offer the following comments as the process of iterating on these problem statements continues.

Problem Statement 2

Problem Statement 2, in its updated form, is as follows:

“Existing PEMs, such as the commonly used 5-in-10 and 10-in-10 approaches, are not well suited for emerging DR participation (inclusive of all technology types such as Behind-the-meter batteries, aggregations, Electric Vehicle charging, etc.) whose frequent dispatching distorts baseline calculations.”

CALSSA appreciates that the problem statement was amended to include examples of technology types encompassed in its scope. Additionally, CALSSA recommends that this problem statement be revised to address two concerns we have previously noted. 

First, the wording of the problem statement inadvertently communicates that frequent dispatch by behind-the-meter batteries and other distributed energy resources is problematic (by saying that frequent dispatch “distorts baseline calculations”). To the contrary, frequent dispatch makes DERs more useful to the grid on a more regular basis, and should be encouraged and not treated as a disadvantage. If existing baseline calculations do not adequately account for the contributions of these resources, the problem statement should more clearly state that.

Second, CALSSA continues to believe it is important to expressly include concerns about PEMs excluding energy exported from BTM storage and other devices. Although the working group will address other themes where energy exports are addressed (including under Economic-Based Demand Response Participation Model and Distributed Energy Resource Participation), this is an issue that directly implicates PEMs.

CALSSA suggests the following changes to the problem statement:

“Existing PEMs, such as the commonly used 5-in-10 and 10-in-10 approaches, are not well suited for emerging DR participation (inclusive of all technology types such as Behind-the-meter batteries, aggregations, Electric Vehicle charging, etc.) whose frequent dispatching distorts has proven difficult to account for using existing baseline calculations.  Further, existing PEMs fail to account for exports, a key source of value that behind-the-meter stationary and mobile storage technologies can provide.

Other Problem Statements

CALSSA and other stakeholders previously suggested revisions to Problem Statements 1, 3, 4, and 5 in comments submitted on May 1, and also gave input on the problem statements during the May 13 working group meeting. Not all of the concerns and suggestions we raised are represented in the current versions of these problem statements. We wish to reiterate some of the concerns we previously noted:

• Problem Statement 1 should not be understood to point to a solution of reducing the number of methodologies, and instead should lead to exploration of why many of the approved methodologies are not more fully used.
• Problem Statement 3 should lead to exploration of issues around device-level measurement, including barriers to the use of premises-level measurement and how relying on premises-level measurement reduces the ability of participants to enroll multiple devices in programs and measure each device’s performance separately. With the development of technology to measure precisely at the device level, methods of measurement and verification should be explored that allow greater precision and participation.

Deferred Problem Statement 

The following problem statement was presented at the May 13 working group meeting as PS #5:

“Requirement for registration of locations to be at the service account level prevents aggregators from developing resources at the level of the customer’s device.”

The discussion paper states that varied positions and feedback were heard on this problem statement, and further discussion is warranted, so the plan is to revisit this problem statement.

CALSSA strongly supports the inclusion of this problem statement, with an addition to address concerns about the existing “Click-Through”/“Share My Data” process that significantly reduces customer enrollment and participation. Therefore, we look forward to revisiting this problem statement.

B. Distributed Energy Resource Participation theme

To better tee up the discussion of this theme when the working group reaches it, CALSSA recommends adding to the existing scope item related to behind-the-meter storage participation, to provide greater clarity about issues of concern.

CALSSA members wish to create a viable market pathway for BTM storage systems to participate in CAISO wholesale markets for the full scope of services they are able to provide. Accordingly, we suggest revising the second scoped item as follows.

“2. Explore behind-the-meter storage participation in wholesale markets through existing or new participation models, including but not limited to, the range of grid services that it can provide, device level registration, and device level performance evaluation inclusive of exports to the grid.”

1. Please provide your organization’s feedback regarding the updated DDEMI Discussion paper (which was published on June 13, 2025).

Derapi appreciates the opportunity to comment on the Discussion Paper draft published June 13, 2025. We thank CAISO staff for their effort in preparing the draft and organizing the Working Group.

Topic 1, Performance Evaluation Methodology:

Derapi supports the inclusion of problem statement #3, “BTM device-level measurement is not recognized for use in developing baselines for PEM options. Performance evaluations depend on energy measurement (load and generation) and don’t recognize non-energy metered technologies contributions to load reduction calculation equivalents.” Many behind-the-meter energy devices available in the market, including solar inverters and battery storage systems, come equipped with the ability to measure their own production or consumption. Recognizing device-level measurement provides a cost-effective way to measure baselines and performance from behind-the-meter devices. Device-level measurement also provides the ability to identify the individual contributions of multiple devices behind the same utility meter, enabling a customer to enroll multiple devices in the same program, or separate programs.

Derapi also encourages CAISO to hold a Working Group session to discuss the proposed problem statement mentioned in the final paragraph of Topic 1, related to registration of locations at the service account level rather than the customer device level. The adoption of flexible load devices such as smart thermostats, battery storage, and managed EV chargers, has reached a level where many customers have multiple devices potentially capable of participating in load flexibility/demand response, but are prevented from enrolling all of their devices due to restrictions on dual participation at the service account level. Failure to address this issue will prevent CAISO from accessing significant levels of capacity as adoption of these technologies continues to accelerate. There exist a number of potential solutions to this problem, and we believe a discussion with the community will prove fruitful.

Topic 2, Economic-based Demand Response Participation Model:

Derapi supports the inclusion of problem statements related to updating PDR programs, and consideration of creating a modified PDR program to accurately reflect load reductions from behind-the-meter storage and Rule 21 exports.

Topic 4, Distributed Energy Resources Participation:

Derapi supports exploration of behind-the-meter storage participation in wholesale markets as part of the discussion for problem statement formation.

1. Please provide your organization’s feedback regarding the updated DDEMI Discussion paper (which was published on June 13, 2025).

Marin Clean Energy (MCE) appreciates the opportunity to comment on the updated DDEMI Discussion Paper and DDEMI Working Group (WG) schedule. As it relates to the updated Discussion Paper and proposed WG schedule: 

• MCE supports the CAISO’s proposed updates to the Performance Evaluation Methodologies (PEMs). The updated problem statements appropriately balance the DDEMI WG principles of efficiency, competition, feasibility, simplicity, reliability/compliance, and practicable facilitation of states’ public policy. MCE supports the WG moving forward with these updated problem statements in a subsequent phase. 

• MCE continues to encourage the CAISO to allow for additional stakeholder presentations beyond the problem statement formation phase. Specifically, MCE recommends that the WG allows for and schedules time for stakeholder presentations in the next phases of the WG (i.e. forming solutions/actions).  MCE recommends that the WG consider soliciting proposals for and authorizing Pilot programs to test alternative baseline approaches to the control group methodology. Such Pilots could be implemented in the near term by continuing to settle on existing approved PEMs, while simultaneously evaluating performance using alternative baseline techniques. As stated in its DDEMI comments submitted on May 27th, 2025, MCE is currently developing an alternative baseline method designed to enable daily participation and enhance performance value by rewarding more frequent load-shifting and encourages the CAISO to consider exploring and authorizing such Pilot programs to better inform policy changes.

• MCE encourages the CAISO to include more specificity and detail in the listed topics outlined in the WG schedule, with as much advanced notice as possible, so that stakeholders can be best prepared to discuss ideas and positions during WG meetings. 

1. Please provide your organization’s feedback regarding the updated DDEMI Discussion paper (which was published on June 13, 2025).

Northern California Power Agency (NCPA) appreciated the opportunity to present the topic of Electrolyzer Market Participation during the June 17, 2025, working group meeting.  As discussed during the June 17, 2025 working group meeting, NCPA believes that CAISO should further consider including as part of this ongoing stakeholder effort, or as part of a separate stakeholder effort that may be better suited for the applicable subject matter, the goal of developing (or further developing) market rules that will enable hydrogen electrolyzer technology to actively participate in the CAISO markets.  As presented by NCPA, NCPA believes the two (2) key configurations that should be further evaluated are the following:

1. Hydrogen electrolyzer(s) that are operated in direct coordination with other technologies (e.g., existing natural gas generating facilities); and

2. Hydrogen electrolyzer(s) that are operated as independent facilities and that participate directly in the CAISO market.

Regarding configuration 1 as described above, this configuration enables the production and storage of hydrogen gas as fuel to be used in coordination with other generating technologies, and to operate as a type of short-term and longer-term storage technology; whereby, hydrogen gas can be produced and stored during period of supply surplus, and the stored gas can subsequently be used as fuel by complementary technologies (e.g., an existing natural gas generating facility) to generate power to support grid reliability.  This configuration may be more appropriately considered as a standalone stakeholder initiative, or further considered in a storage focused initiative.  For example, similar to BESS that provide storage (that are not subject to TAC/WAC charges when accepting charging energy), hydrogen electrolyzers that are used as storage devices should receive comparable settlement treatment.

Regarding configuration 1 as described above, NCPA looks forward to the opportunity to discuss what market rules may be required to account for the unique operating characteristics of hydrogen electrolyzers, with focus on the operational flexibility this technology offers. 

1. Please provide your organization’s feedback regarding the updated DDEMI Discussion paper (which was published on June 13, 2025).

PG&E appreciates the opportunity to comment on the updated DDEMI Discussion paper and concurs with the five problem statements related to the PEM thematic area.   PG&E also appreciates the support of CAISO and the stakeholder community for the inclusion of the problem statement expressing the challenges related to the control group methodology and looks forward to the development of potential solutions with the goal of making the control group methodology useful for all demand response providers, IOUs, third parties and WEIM entities.    

PG&E is pleased to work with CAISO and a diverse group of stakeholders to address the challenges and opportunities expressed in the remaining PEM problem statements and the upcoming thematic areas in pursuit of the goal of greater integration of demand and distributed energy resources in the CAISO markets. 

1. Please provide your organization’s feedback regarding the updated DDEMI Discussion paper (which was published on June 13, 2025).

PacifiCorp agrees with the characterization of discussion topics outlined thus far in the discussion paper and requests the CAISO to continue down the path of education of the current offerings. The working group has been pivotal in providing high level education to stakeholders on demand response registration, participation model requirements, and potential areas of enhancements that the CAISO could implement. PacifiCorp believes the working group is ready to conduct a more in-depth discussion on the various participation models, and the tradeoffs of each model, due to the foundational concepts presented by the CAISO and stakeholders. As such, in a future working group meeting, PacifiCorp requests a deeper dive into all the demand response participation offerings so stakeholders can assess the tradeoffs of each participation model. PacifiCorp believes this will enable future problem statement shaping. 

PacifiCorp is currently evaluating which participation models would fit its current demand response fleet, which consists of irrigation, residential, commercial and industrial programs using smart meters. PacifiCorp has completed a detailed review of the metering requirements and demand response sections of the CAISO’s tariff, market operations, demand response, metering and telemetry business practice manuals, working group presentation and discussion paper materials, in addition to the comparison matrix. Thus far, PacifiCorp has found the information publicly available to be widely dispersed and lacking technical detail to assess which option is the best for registering its demand response fleet. As such, PacifiCorp requests the CAISO to provide an integrated, clean document that stakeholders can use to guide them through the registration process. For example, the comparison matrix describes under the "performance evaluation methodology for settlement” that for proxy demand response participation requires a baseline, however, the NGR participation doesn’t explicitly state whether one is required for all sub-types and only describes state of charge requirements. 

1. Please provide your organization’s feedback regarding the updated DDEMI Discussion paper (which was published on June 13, 2025).

Portland General Electric (“PGE”) appreciates the opportunity to comment on the updated June 13 DDEMI Discussion Paper and thanks CAISO staff for facilitating a stakeholder-driven process that is actively surfacing barriers and opportunities related to demand-side and distributed energy resource participation.

Our highest-priority issue remains the need for more flexible and accurate Performance Evaluation Methodologies (PEMs), particularly baseline options. As a WEIM-only entity operating in a region with variable and often extreme weather conditions, the CAISO’s default methodologies have proven ineffective and inaccurate for many DR resources in our footprint. The discussion paper accurately reflects widespread stakeholder input that the current suite of PEMs does not adequately support emerging resource types or operational realities. PGE supports efforts to address this through enhanced PEM flexibility, including the use of device-level data and recognition of non-energy metered technologies.

In addition, the CAISO's limited ability to make detailed operational adjustments without tariff changes, as explained in the DDEMI discussion paper, is a persistent constraint that should be revisited. To that end, we encourage the CAISO to establish a formal path for submitting program-specific PEM/Baseline Plans, similar to how scheduling coordinators currently submit metering templates for SQMD review. This process could enable more accurate measurement and lower performance risk, particularly for newer DR configurations and non-CAISO BAAs. For WEIM entities like PGE, these improvements are essential to scale DR participation while maintaining accurate forecasting and settlement alignment with local operational realities.

PGE also seeks to prioritize the development of a new DR participation model that reflects the nuanced characteristics of today’s demand response programs, including those that involve BTM storage, export behavior, and mixed load/generation profiles. The proposed mPDR concept is a helpful starting point and PGE looks forward to additional concept exploration. 

PGE appreciates the CAISO’s focus on harmonizing DR and DER participation models for WEIM and EDAM-specific use cases. PGE supports continued discussion of the distinctions in regional characteristics and operations as problem statements are refined and prioritized.

In summary, PGE supports the DDEMI process and encourages the CAISO to maintain a sequential pathway towards (1) near-term improvements in PEM flexibility, including incorporation of bespoke PEMs for external, non-CAISO BAAs, and (2) long-term evolution of demand-side participation models to allow for more dynamic design as DR/DER technologies mature. Prioritizing these changes will establish a strong foundation for subsequent efforts and ensure that the most consequential improvements are addressed early.

1. Please provide your organization’s feedback regarding the updated DDEMI Discussion paper (which was published on June 13, 2025).

Problem Statements Missing in the DDEMI Discussion Paper 

Southern California Edison (SCE) did not see the suggested problem statements below in the discussion paper:  

1. Discrete Reliability Demand Response Resources (RDRR) should be allowed to be derated or rerated across the entire range between Pmin and Pmax.  Although this may seem counter-intuitive, there are two operational realities upon which this request is based. 

   a. RDRRs are shared resources between SCE’s reliability/transmission function and SCE’s scheduling coordinator/marketing function.  When an RDRR is dispatched via the market, the Scheduling Coordinator (SC) must dispatch the entire resource. However, when an RDRR is dispatched by the reliability side, they do not necessarily need to dispatch the entire resource.  In such cases, the SC is unable to accurately represent the remaining quantity of RDRR MW available to the market.    

b. Available MWs for some RDRRs are a function of the weather.  Without the ability to partially derate, this can result in a skewed representation of the quantity of MW available to the market.  

2. When CAISO enables RDRR resources into CAISO markets, they should notify the Market Participants (the Scheduling Coordinators) directly.  Currently, CAISO Operations provides this notification to the reliability side of SCE (Grid Control), which has no action to take based on this notification.  Since enabling and dispatching RDRR resources via the CAISO market is a market function (e.g. SCE’s Energy Procurement & Market organization), CAISO should be providing notifications to the Market Participants at the same time notification is sent to SCE’s Grid Control. 

These problem statements were submitted by SCE via comments for the February 5, 2025 Demand and Distributed Energy Market Integration (DDEMI) working group meeting.   

New Problem Statement to Include in Discussion Paper 

SCE has an additional problem statement to add to the discussion paper.  The new problems statement is as follows: 

CAISO should implement a meaningful Resource ID naming convention for RDRRs. Currently, it is challenging for scheduling coordinators to identify which Resource ID corresponds to each Demand Response program due to the lack of clarity in CAISO’s naming convention. For example, SCE’s RDRR portfolio includes multiple programs such as the Summer Discount Plan (SDP), Smart Energy Program (SEP), Agricultural and Pumping Interruptible (API), and Base Interruptible Program (BIP). At a minimum, CAISO should include the program acronym in the Resource ID or allow scheduling coordinators to create their own Resource IDs. 

1. Please provide your organization’s feedback regarding the updated DDEMI Discussion paper (which was published on June 13, 2025).

Tesla believes the DDEMI discussion paper accurately reflects working group discussions to date and that the problem statements generally capture key issues related to the market participation of behind-the-meter (BTM) batteries, which is Tesla’s primary focus.

There are currently a few problem statements that are related to the participation of BTM batteries in Demand Response participation:

Performance Evaluation Methodology: Existing PEMs, such as the commonly used 5-in-10 and 10-in-10 approaches, are not well suited for emerging DR participation (inclusive of all technology types such as Behind-the-meter batteries, aggregations, Electric Vehicle charging, etc.) whose frequent dispatching distorts baseline calculations.

Tesla agrees with the thrust of this problem statement and the issues it raises about how frequent BTM battery dispatch represents a challenge to  traditional 5-in-10 or 10-in-10 baselines. However, we are concerned about the notion that battery dispatch is “distortionary” which puts a pejorative lens on what is actually a strength of the technology and its ability to specifically respond to customer and grid needs. We offer some edits to the language below to address this framing.

Furthermore,Tesla continues to recommend that CAISO explore both baseline and non-baseline PEM frameworks to more accurately evaluate DER performance, including exports beyond what is currently possible with the metered generation output (MGO) methodology. This would provide needed flexibility to support a range of DER configurations and participation models.

Tesla also recommends that this Problem Statement highlight that no current PEMs recognize the value of exports that can be provided by BTM batteries and other DERs. A PEM that fully recognizes the potential for DERs to contribute to the grid will evaluate the full performance of a device, inclusive of exports.

With the above comments in mind, we recommend amending the current PEM problem statement as it relates to these issues as follows:

“Existing PEMs, such as the commonly used 5-in-10 and 10-in-10 approaches, are not well suited for emerging DR participation (inclusive of all technology types such as Behind-the-meter batteries, aggregations, Electric Vehicle charging, etc.) whose frequent dispatching distorts and their ability to export energy to the grid is not reasonably captured in existing baseline calculations”.

Economic-based Demand Response Participation Model: Create a new variant of PDR called mPDR to more accurately reflect load reductions of PDR participants with behind-the-meter storage or Rule 21 exports.

Tesla supports this problem statement and believes that creating a new PDR variant will help meaningfully address the barriers that exporting resources face in participating in PDR. Tesla has specific feedback on the mPDR proposal that we will share in a future commenting opportunity on mPDR.

Overall, Tesla recommends that mPDR focus on device-driven demand response and address the barriers to BTM storage participation that are discussed below.

Distributed Energy Resource Participation: Explore behind-the-meter storage participation in wholesale markets.

Tesla strongly supports efforts to explore BTM storage participation in wholesale markets. Generally, Tesla recommends that the following elements and barriers be addressed specifically for BTM storage:

• Expansion of services: Consider how BTM batteries can provide additional ancillary services to the market, such as frequency regulation.
• Device-level registration: Enrollment processes should be streamlined to simplify registration of battery devices in wholesale markets. Current processes such as the Customer Information Service Request (CISR) form and Share My Data agreements have proven burdensome and confusing for customers, significantly impeding DER participation. Tesla believes there are easier ways to share device level data for performance evaluation. Allowing for the registration of an individual device in PDR would also allow aggregators to enroll individual customer devices when there are multiple smart devices on a premise participating in different programs.
• Performance evaluation at the device level that is inclusive of exports: Tesla reiterates that performance evaluation should occur at the device level, using device telemetry to ensure accurate settlement and enable more granular and sophisticated services. However, to fully realize these benefits, exports must be incorporated into the evaluation. If exports are excluded, CAISO will still need to reconcile device telemetry with customer meter data, undermining the advantages of device-level registration.

Tesla recommends incorporating these three elements into the Problem Statement to ensure that these issues are explicitly addressed as follows:

Distributed Energy Resource Participation: Explore behind-the-meter storage participation in wholesale markets, including the types of services that DERs broadly, and batteries in particular, can provide, device level registration, and device level performance evaluation that recognizes exports.