Comments on DAME Configurable Parameters Implementation Working Group

1. Please provide a summary of your organization's comments on the December 18, 2025 DAME Configurable parameters implementation working group discussion.

Comments on Day-Ahead Market Enhancements Configurable Parameters

Working Group Presentation on December 18, 2025

Department of Market Monitoring

January 8, 2026

Summary

The Department of Market Monitoring (DMM) appreciates the opportunity to comment on the Day-Ahead Market Enhancements - Configurable Parameters Implementation Working Group presentation on December 18, 2025.[1] DMM supports the ISO testing the sensitivity of the configurable parameters on market results prior to go-live, but continues to recommend caution when interpreting results that use unrealistic market data. When determining configurable parameter values that impact deliverability of imbalance reserves (IR), DMM supports an approach that balances computational complexity and market efficiency with the need for sufficiently reliable and deliverable imbalance reserve capacity. DMM continues to request that the ISO provide additional information regarding IR bids being used in testing to allow better understanding of the interaction between IR bids and IR prices.

Comments

DMM understands that computation time will be the deciding factor on which constraints will be considered in the imbalance reserve (IR) deployment scenarios. DMM supports the ISO’s plan to use the same approach used for the flexible ramping product (FRP) deployment scenarios by first enforcing flowgates, then nomograms, and then assessing feasibility of contingencies. Due to performance issues with solution run-times, the ISO does not include contingency flowgate constraints in FRP deployment scenarios.

Because the IR deployment scenarios are run in the day-ahead, the computation time may not be as limiting as it was for FRP. Ideally, all constraints (flowgates, nomograms, and contingencies) should be included because using the same constraints for both the market run and the deployment scenarios is important for preventing stranded capacity.[2] However, full deliverability may be too high a standard and if computation times are too burdensome, tradeoffs may need to be made and DMM supports the ISO’s proposal to prioritize the inclusion of flowgates and nomograms.

DMM recommends the ISO consider starting the deployed imbalance reserve (DIR) factor at a value less than 100 percent, and then analyze after go-live whether it is necessary to increase. If the ISO is not open to changing the initial value, DMM recommends the ISO prioritize testing whether lowering the DIR significantly impacts deliverability. The DIR factor creates a trade-off, and either extreme has its downfalls. Even a 100 percent DIR factor does not guarantee deliverability in real-time.

The ISO’s analysis shows higher DIR factors may lead to higher IR prices and could also result in more demand curve procurement which implies fewer IR awards to resources (less capacity procured). On the other end, a zero percent factor would likely result in IR being awarded to stranded resources, resulting in capacity that would not be deliverable. DMM recommends the ISO consider starting the DIR factor lower than the proposed 100 percent, and potentially increasing this value if a deliverability problem arises.

DMM continues to request that the ISO provide additional information regarding IR bids to allow better understanding of the interaction between IR bids and IR prices.[3] Specifically, DMM requests the ISO provide figures similar to the ones in the presentation that show IR bid megawatt quantities by price bucket, but exclude the megawatt quantities of IR bids that correspond to energy schedules or are infeasible due to commitment status and start-up time. Such data would be beneficial, for example, to better understand why there are so many hours that have 8-9 GW of imbalance reserve up (IRU) bids less than or equal to $5/MWh (slide 38) but result in relaxing the IR constraint at $40/MWh prices (slide 42) when the requirement is 2-4 GW.[4]

[1]  Day-Ahead Market Enhancements: Configurable Parameters Implementation Working Group presentation, California ISO, December 18, 2025: https://stakeholdercenter.caiso.com/InitiativeDocuments/Presentation-Day-Ahead-Market-Enhancements-Configurable-Parameters-Implementation-Working-Group-Dec-18-2025.pdf

[2]  2024 Annual Report on Market Issues and Performance, Department of Market Monitoring, August 7, 2025, p. 232: https://www.caiso.com/documents/2024-annual-report-on-market-issues-and-performance-aug-07-2025.pdf

[3]  Comments on Day-Ahead Market Enhancements Configurable Parameters Working Group Presentation on November 20, 2025, Department of Market Monitoring, December 10, 2025: https://www.caiso.com/documents/dmm-comments-on-day-ahead-market-enhancements-configurable-parameters-implementation-nov-20-2025-working-group-dec-10-2025.pdf

[4]  Day-Ahead Market Enhancements: Configurable Parameters Implementation Working Group presentation, California ISO, December 18, 2025: https://stakeholdercenter.caiso.com/InitiativeDocuments/Presentation-Day-Ahead-Market-Enhancements-Configurable-Parameters-Implementation-Working-Group-Dec-18-2025.pdf

2. Please provide a summary of your organization's comments regarding the discussion on Analysis #3 results – Set of enforced constraints.

Please see the PDF attached below the final question for DMM's fully formatted complete set of comments. For the reader's convenience, the complete text of the comments is pasted in response to #1, but there may be some formatting errors.

3. Please provide a summary of your organization's comments regarding the discussion on updates to benchmark setup and associated market results.

Please see the PDF attached below the final question for DMM's fully formatted complete set of comments. For the reader's convenience, the complete text of the comments is pasted in response to #1, but there may be some formatting errors.

4. Please provide a summary of your organization's comments regarding the discussion on Sensitivity analysis #4 results - Proportion of deployed reserves.

Please see the PDF attached below the final question for DMM's fully formatted complete set of comments. For the reader's convenience, the complete text of the comments is pasted in response to #1, but there may be some formatting errors.

5. Please provide any additional comments.

Please see the PDF attached below the final question for DMM's fully formatted complete set of comments. For the reader's convenience, the complete text of the comments is pasted in response to #1, but there may be some formatting errors.

1. Please provide a summary of your organization's comments on the December 18, 2025 DAME Configurable parameters implementation working group discussion.

Energy Division staff (ED staff or staff) of the California Public Utilities Commission (CPUC) develops and administers energy policy and programs to serve the public interest, advises the CPUC, and ensures compliance with CPUC decisions and statutory mandates. ED staff provides objective and expert analyses that promote reliable, safe, and environmentally sound energy services at just and reasonable rates for the people of California.  

ED staff appreciates the opportunity to submit comments on the Day-Ahead Market Enhancements (DAME) configurable parameters implementation working group, which is focused on the implementation of the new imbalance reserves requirements. ED staff also appreciated the sizable amount of material analyzed and released for discussion at the working group meeting that was held on December 18th, 2025.

At a high level, ED staff has a number of questions about the data and methodology used by CAISO that was presented at the workshop, which we discuss in more detail below. ED staff also recommends that, in order to test and fully vet the configurable parameters that will be used in the EDAM market beginning on May 1, 2026 and through the summer, CAISO should continue to test various imbalance reserve requirements on high load days (e.g., 45,000 MW) and under various stressed system conditions, rather than on non-stressed, low-load days (CAISO presented data regarding the imbalance reserve prices and outcomes for a very low load day, i.e., Saturday, October 4, 2025). 

Finally, ED staff are concerned that the imbalance reserve requirements may be set too high and may prove costly, given the preliminary results provided at the workshop. ED staff understand CAISO does not agree with our preliminary cost analysis, but the data available to market participants is limited. ED staff understand there are significant time limitations, but ED staff is using the best available information to conduct this analysis, given the importance and potential cost of this new product. Therefore, consistent with CAISO’s commitment in its DAME tariff filing to address parties concerns about potential costs associated with imbalance reserve product, ED staff recommends that CAISO proactively consider steps it could take should the preliminary results materialize in the market when CAISO implements the EDAM and DAME changes on May 1, 2026. ED staff are concerned that the Imbalance Reserve product, as designed, will cause CAISO customers to double-pay for resources that must bid into CAISO markets: once via contracts for RA resources that have day-ahead and real-time must offer obligations, and again for those same resources when they are selected as Imbalance Reserves. Ultimately, the Imbalance Reserve design must ensure that CAISO customers do not double-pay for reliability capacity.

ED staff thank CAISO for the analysis provided regarding the envelope constraint multiplier’s impact on ancillary services -- the results are as expected. ED appreciates the focus of the December 18^th meeting on constraint enforcement and deployment factor. As it stands today, it does not appear that CAISO is open to re-evaluating the 97.5% percentile of uncertainty, given that this would require a tariff revision. As a result, the correct tuning of the deployment factor and constraint enforcement will be critical to minimize impacts of the costs associated with the new imbalance reserve product, which ED staff has consistently argued will be set too high on most days and will result in additional, and duplicative costs for CAISO customers.

After EDAM go-live CAISO said it will consider conducting a cost/benefit analysis of Imbalance Reserves, as stated on slide 15 of the December 18^th Working Group slide deck. ED staff looks forward to this analysis, but is concerned that this would be too late if it results in large potential new costs as a result of EDAM (e.g., imbalance reserve costs as well as potentially compounding effects on energy costs, congestion costs, and bid cost recovery costs, etc.). While we recognize that the data that will emerge out of Parallel Operations is still limited, ED staff would appreciate it if CAISO would conduct a cost/benefit analysis to understand if the imbalance reserve configurable parameters need any urgent adjustments. CAISO noted in its tariff filing that it was “committed to implementing a range of configurable market parameters in the software design to permit the CAISO to make refinements readily based on experience during the market simulation period and during the initial stages of implementation. … to provide off-ramps and the ability to pivot quickly should the CAISO identify unintended adverse consequences.”  Id[1].   (Emphasis added.)

[1] DAME/EDAM Tariff Filing, Transmittal Letter at 100, 20230822-5161_DAME-EDAM Transmittal Letter Final.pdf

2. Please provide a summary of your organization's comments regarding the discussion on Analysis #3 results – Set of enforced constraints.

• ED staff requests CAISO clarify the alternative constraint enforcement plan. On slide 30, CAISO finds 52% of all congested constraints are tied to contingencies. On slide 32, CAISO indicates the alternative will be to “leverage on approach used for FRP: enforce flow gates, then nomogram and then assess feasibility of contingencies.” ED staff understands selecting a subset of transmission constraints can be difficult due to a reliance on system conditions for these contingencies, but is there not enough historical data to have a reasonable idea of which transmission constraints are enforceable or should be?
• ED staff would like to better understand if this tunable parameter and constraint enforcement can vary by season or based on other system conditions (e.g., load).
• ED staff requests that CAISO explain the drawbacks of enforcing everything in the DAM, and only enforcing what is feasible in the RTM?
• ED staff requests that CAISO conduct further analysis surrounding the computational limitations of constraint enforcement as we add more non-CAISO BAAs to EDAM. CAISO in their answer to SCE during the Working Group meeting pointed to their ability to operate the market in real-time for 23 BAAs. This response does not take into account CAISO’s own statement on slide 32, that CAISO does not enforce all constraints in the RTM.

3. Please provide a summary of your organization's comments regarding the discussion on updates to benchmark setup and associated market results.

ED staff appreciates CAISO dedicating time to conducting this data analysis on the implementation of imbalance reserves, but has a number of questions and recommendations. ED staff reiterates the questions from the previous presentation below (in normal text), some of which were partially addressed at the last meeting, but also includes new questions and recommendations (in italics below).

• ED staff request that CAISO provide the data on the ancillary service prices for all analyses and scenarios previously conducted and all analyses and scenarios going forward.
• ED staff requests that CAISO calculate the costs of the IR products to customers on an annual basis for each of the imbalance reserve up and imbalance reserve down scenarios, if the results occurred every day of the year.
• ED staff requests that CAISO address the functionality in OASIS mapstage, as it is not possible to download the imbalance reserve and reliability capacity price data. The inability to download this data hampers ED staff’s ability to conduct robust analyses.  ED staff has been in contact with CAISO staff regarding this issue, beginning on October 24, 2025.
• In addition, if cost analysis does occur closer to EDAM go-live, does CAISO have a plan if these new costs are significant? Is there any mechanism being considered to protect ratepayers from potentially large non-forecasted costs? Has CAISO considered needing to open an expedited tariff revision process if costs coming out of parallel operations are unreasonably high?
• ED staff requests that CAISO consider changing the configurable parameters based on system conditions (e.g., with load less than 43,000 MW, using 0% for the envelope constraint and no deployment).
• ED staff requests clarification if and when CAISO will consider reducing the 97.5% level of uncertainty being used for procurement of imbalance reserves? Cal Advocates raised this question in the November 20th meeting, but was told that adjusting this 97.5% value is not in scope. If we consistently see over procurement of imbalance reserves due to the 97.5% level of uncertainty, a reduction in this value is warranted before EDAM go-live to ensure ratepayers are not being exposed to unneeded costs.
• ED staff requests that CAISO explain how imbalance reserve prices are roughly $10/MWh, when all bids are $0.  A fuller explanation is warranted as this result does not seem to make sense.

• ED staff requests that CAISO explain what is actually procured in the scenario where all bids are placed at $55/MWh and the demand curve reduces the price. It would be helpful to explain whether no imbalance reserves are procured under this scenario. That is, if all bids are $55/MWh, and the price is set at $30/MWh by the demand curve, it would seem that no imbalance reserves would be procured. Can you confirm that if all bids are at $55/MWh and the demand curve sets the price at $35/MWh, then no imbalance reserves is procured?
  • If this is the case, is there any penalty to not meeting the IR requirements or are bids forced to clear at $30/MWH, and if so, can these generators, then receive BCR for the difference between $30 and $55?
  • ED staff understands imbalance reserves to be eligible for BCR per 11.8.2.1 IFM Bid Cost Calculation “For each Settlement Interval, the CAISO shall calculate IFM Bid Cost for each Bid Cost Recovery Eligible Resource as the algebraic sum of the IFM Start-Up Cost, IFM Transition Cost, IFM Minimum Load Cost, IFM Pump Shut-Down Cost, IFM Energy Bid Cost, IFM Pumping Cost, IFM AS Bid Cost, IFM GHG Bid Cost, and IFM Imbalance Reserves Bid Cost.” If this is not the case, can CAISO please clarify?
• ED staff requests clarification on page 23 of the November 20^th meeting, how were bids above $55 simulated? It is not clear the rationale for testing bids above the bid cap. Thus far cost analysis has not been provided, and opening the door to a potentially higher bid cap at this time seems unwise.
• ED staff requests that CAISO provide more explanation of the price separation effects between the BAAs and how imbalance reserves is affecting price separation for each scenario and compare this to a base case, with no imbalance reserves or reliability capacity (i.e., business as usual case).  Further, ED requests that CAISO run a business as usual case for each case that it has run and will run in the future.
• ED staff requests further clarification on slide 45 of the November 20^th meeting, how many of these import bids are CPUC-jurdisctional LSE RA imports bidding at $0 versus actual economic bids?
• ED staff questions whether the amount of self-schedule bids for PACW on slide 27 of the November 20^th meeting is reasonable, it appears to be around 40%.  Can CAISO provide more clarity on the level of self-schedule bids being used in this modeling and the rationale for such a high amount of self-schedules?
• ED staff requests further clarification on the diversity benefit discussion around slide 30 of the November 20^th meeting, is this a purely mathematical reduction or does there have to be sufficient transfer capability for these flows to occur?
• ED staff requests follow-up on slide 42, Cal Advocates inquired why the demand curve at 6 AM is all at the bid cap, can CAISO please explain why this same phenomenon is occurring in HE 22 and 23?

4. Please provide a summary of your organization's comments regarding the discussion on Sensitivity analysis #4 results - Proportion of deployed reserves.

ED appreciate the deployment factor analysis. ED does not think we should set the deployment factor so high that we cause unneeded congestion costs, nor unnecessarily increase energy prices.  

• ED staff requests further explanation on slide 59 “While the DIR Factor impacts energy pricing locally due to the additional congestion impacts, the overall impact on system pricing was limited even on this high load day.” Does CAISO plan to publish where these local impacts are more significant? It seems this information could be useful for those purchasing auctioned CRRs. Likewise, when CAISO says that the overall impacts on system pricing was limited, could CAISO please quantify the impacts in terms of additional costs across the entire system (i.e., not just examining the system marginal energy cost).
• ED staff requests further analysis from slide 66-68.  As presented, the slide seems to suggest there are diminishing returns to deployment of imbalance reserves; that is, a higher deployment produces more demand curve procurement, higher prices, and ultimately less procurement. Therefore, ED staff questions whether 100% deployment is the most sensible starting point for EDAM go-live?

5. Please provide any additional comments.

• ED staff request further clarification and testing of the competitiveness of the imbalance reserve product, based on the high demand chart on slide 57 of the November 20^th meeting, for example 19 hours are being set by the demand curve, not submitted bids.
• ED staff again will note here that it would be helpful to be able to download the price data tied to the analysis presented in each working group so far. This would allow ED staff to be able to undertake more thorough analysis and be prepared to conduct similar analysis from the data developed during parallel operations. ED staff understands that CAISO staff have indicated that providing this data is too burdensome and will not be provided.
• ED staff understands that CAISO does not agree with the preliminary calculation of imbalance reserves costing the CAISO BAA $300 million annually. The data being presented thus far is limited. ED staff have estimated this cost to the CAISO BAA based on the available data. Rather than CAISO conducting a cost/benefit analysis in response, or providing more data, CAISO has provided a menu of reasons this number could possibly be wrong, including the following:
  • “Today, we already incur costs for similar services—hidden in uplift charges, real-time imbalance costs, and RA contracts. EDAM will make these costs transparent and, through diversity benefits, reduce them compared to what we pay today. Additionally, the CAISO can provide IR to other balancing areas, creating revenue opportunities that flow back to ratepayers and help offset RA costs.”
    • Therefore, ED staff requests CAISO provide data on the costs of these hidden uplift charges and real-time imbalance costs. This will help stakeholders understand what percentage of this new market product is additive, and how much of this product cost is costs being redirected from other areas.
• ED staff requests clarification on whether parties/generators will be required to submit imbalance reserve bids or whether CAISO will be seeding the bids?
• ED staff continues to request CAISO provide Energy Division staff with underlying data from the imbalance reserves scenarios.

1. Please provide a summary of your organization's comments on the December 18, 2025 DAME Configurable parameters implementation working group discussion.

PG&E appreciates the opportunity to comment on the continued effort to tune the DAME configurable parameters.  We also appreciate that the CAISO team has been receiving a lot of feedback and has been responsive.

PG&E’s comments and feedback on the 12/18/25 meeting can be summarized in the following three points:

• PG&E looks forward to seeing the detailed plan for evaluating the parameters in parallel operations and the plan should include:
  • A detailed timeline with time allotted for discussion and delays.
  • A detailed description of the tuning cases including stressed cases and regionally diverse scenarios.
  • Description of how the parameter values will be evaluated (i.e., performance metrics); the evaluation criteria should including a consideration of cost. 
• PG&E appreciates that CAISO has a plan for post-launch analysis and is preparing options for quick responses should the market need it.
• PG&E appreciates the complexity of the analysis CAISO has provided.

2. Please provide a summary of your organization's comments regarding the discussion on Analysis #3 results – Set of enforced constraints.

PG&E took away two main points from the CAISO presentation on the set of enforced constraints:

1. The solve-time will determine the set of enforceable constraints
2. This solve-time cannot be assessed until parallel operations.  

The conclusion of these two points is that CAISO and stakeholders will have to wait until parallel operations for any meaningful data or insights. We appreciate this and look forward to engaging with you after parallel operations start.

3. Please provide a summary of your organization's comments regarding the discussion on updates to benchmark setup and associated market results.

No comments.

4. Please provide a summary of your organization's comments regarding the discussion on Sensitivity analysis #4 results - Proportion of deployed reserves.

PG&E appreciates the complexity of the analysis CAISO has provided.

The analysis CAISO has done shows many unintuitive results and complex dynamics between the parameters, bidding, the demand curve, congestion, and market costs. For example, the relationship between higher deployment and higher congestion makes perfect sense, but high bid prices resulting in less congestion is far less intuitive; but it makes sense given the presentation. This is an excellent insight and very much appreciated.

Again, CAISO’s presentation of how congestion can happen independently on Energy, IRU, and IRD was very insightful.

This is a complex set of choices we’re making with the parameters and appreciate the dedication CAISO is giving to this effort.

5. Please provide any additional comments.

PG&E looks forward to seeing the detailed plan for evaluating the parameters in parallel operations. Additionally, it has some suggestions for what it would like to see included in the plan.

PG&E provided feedback last round that the timeline in parallel operations is going to be tight given all the sensitivity analysis needed to reach agreement with stakeholders on the final parameter values. As we approach the May 1^st go-live date for EDAM, PG&E is growing concerned that the analysis needed to make informed decisions on the configurable parameters may not be completed in time for go-live.

In the January 29^th plan must include the following items:

• Timeline with time budgeted for discussion and delays.
• Description of how the parameter values will be evaluated (i.e., performance metrics); the evaluation criteria should including a consideration of cost.
• A description on how CAISO is going to incorporate stakeholder feedback from the 1/19/26 meeting into the tuning plan given the short window in which to tune.
• Detailed description of the tuning cases, which much include “high transfers” cases:  

High transfer between CAISO from PAC and vice versa. 

We imagine a case where CAISO load is elevated and PAC is not; leading to high transfers into CAISO. Additionally a case where PAC load is elevated and CAISO is not; leading to high transfers from CAISO to PAC.  We believe this is needed as CAISO and PAC’s regulatory environment, fleet, and systems are different and the optimal parameter value for one BAA may not be the optimal for the other. Understanding if the differences between the BAAs matter or any trade-offs in parameter values could prove important in the final selected values.

• In addition to the “must have” elements (above) PG&E would like to see the following cases:
  • High Solar Scenario. Flows and congestion is very different at peak solar than at peak load or peak net-load. The difference in supply, flow direction, and congestion in a high solar case might help to identify additional trade-offs in parameter values.
  • High transfers and high exports out of CAISO. Given recent events where the CAISO BAA has experienced high levels of self-scheduled exports, PG&E would like to see a scenario showing how IR would operate under similar circumstances.

How is CAISO going to incorporate stakeholder feedback from the 1/29 meeting?

The tentative date for the next meeting is January 29^th with an expected comment due date of February 12^th.  Parallel operations is expected to begin on February 2^nd. This means CAISO will already be well into parallel operations before it even receives feedback. Given this known time crunch, we’d like to understand how CAISO is already planning to incorporate stakeholders’ feedback.

PG&E appreciates that CAISO has a plan for post-launch analysis and is preparing options for quick responses should the market need it.

Stakeholders are very concerned about the cost of the IR and have repeatedly asked CAISO to be ready to intervene if the worst should come to pass. We appreciate that the CAISO is already thinking of how it will monitor IR post launch and ways in which it could correct course if needed.

1. Please provide a summary of your organization's comments on the December 18, 2025 DAME Configurable parameters implementation working group discussion.

SDG&E appreciates CAISO’s written responses to stakeholder comments and confirmation that the impacts of the envelope multiplier on storage resources will be assessed following go-live. While SDG&E remains concerned that meaningful evaluation will only occur after the period during which market participants can proactively review and provide input and once there are realized market impacts on resources and prices, we recognize that certain assessments can only be conducted when operations are underway.

Given the importance of this analysis, SDG&E asks for additional details on CAISO’s plan for reporting on the interplay between the envelope multiplier value and the real-time availability of storage resources to stakeholders after May 1, 2026. The provision of transparent and timely data will be essential for stakeholders to determine whether the envelope constraint is overly restrictive on storage resources’ ability to provide imbalance reserves. This reporting could include information on the real-time deliverability of the reserves that are clearing, or any other metrics that CAISO or stakeholders believe could be used to inform whether the multiplier is appropriately calibrated.

2. Please provide a summary of your organization's comments regarding the discussion on Analysis #3 results – Set of enforced constraints.

SDG&E appreciates the information provided by CAISO on the set of enforced constraints during testing. Given the challenges with the solve time for the market solution and the possible outcome of enforcing only a subset of constraints, it would be helpful to provide additional analysis on the impact of enforcing different constraints in the different market runs as this work continues. Further, while leveraging the approach used for FRP seems like a reasonable approach, SDG&E would like to understand whether there may be value in dynamically selecting or prioritizing a subset of transmission constraints that are known to regularly bind for testing purposes. SDG&E thanks CAISO for its consideration of its recommendations and looks forward to continued participation in the working groups.

3. Please provide a summary of your organization's comments regarding the discussion on updates to benchmark setup and associated market results.

No comment.

4. Please provide a summary of your organization's comments regarding the discussion on Sensitivity analysis #4 results - Proportion of deployed reserves.

No. comment.

5. Please provide any additional comments.

No comment.

1. Please provide a summary of your organization's comments on the December 18, 2025 DAME Configurable parameters implementation working group discussion.

Please see attached document

2. Please provide a summary of your organization's comments regarding the discussion on Analysis #3 results – Set of enforced constraints.

Please see attached document

3. Please provide a summary of your organization's comments regarding the discussion on updates to benchmark setup and associated market results.

Please see attached document

4. Please provide a summary of your organization's comments regarding the discussion on Sensitivity analysis #4 results - Proportion of deployed reserves.

Please see attached document

5. Please provide any additional comments.

Please see attached document

1. Please provide a summary of your organization's comments on the December 18, 2025 DAME Configurable parameters implementation working group discussion.

Six Cities’ Summary:  The CAISO’s responses to stakeholder questions and comments relating to the costs versus benefits of the Imbalance Reserve (“IR”) products to date do not provide a basis for confidence that the configurable parameter values the CAISO proposes to apply upon implementation of the Extended Day-Ahead Market (“EDAM”) can be expected to result in an appropriate cost/benefit relationship.  The Six Cities reiterate their concerns with the absence (thus far) of cost/benefit data and urge the CAISO to focus efforts both prior to and immediately following EDAM implementation on evaluation of quantifiable benefits of IR procurement in relation to cost.

2. Please provide a summary of your organization's comments regarding the discussion on Analysis #3 results – Set of enforced constraints.

Six Cities' Response:  The Six Cities have no comments on this aspect of the December 18, 2025 discussions.

3. Please provide a summary of your organization's comments regarding the discussion on updates to benchmark setup and associated market results.

Six Cities' Response:  The Six Cities have no comments on this aspect of the December 18, 2025 discussions.

4. Please provide a summary of your organization's comments regarding the discussion on Sensitivity analysis #4 results - Proportion of deployed reserves.

Six Cities' Response:  The Six Cities have no comments on this aspect of the December 18, 2025 discussions.

5. Please provide any additional comments.

Six Cities’ Comments:  The essence of the CAISO’s responses to stakeholder comments on the configurable parameters working group discussions to date is that the outcomes of market simulation exercises for the EDAM do not provide reliable data for estimating expected costs for the new IR products when the EDAM becomes operational.  It has been and remains the Six Cities’ understanding that the purpose for establishing configurable parameters is to calibrate the procurement of IR such that the procurement costs are commensurate with the benefits provided by the product.  The CAISO’s responses to stakeholder questions and comments relating to the costs versus benefits of the IR products to date do not provide a basis for confidence that the parameter values the CAISO proposes to apply initially (i.e., at EDAM go-live, now less than six months away) can be expected to result in an appropriate cost/benefit relationship.  The CAISO’s recitation of theoretical or conceptual benefits of IR in the final segment of the 12/17/25 response matrix (addressing comments by the CPUC Energy Division) lacks empirical support and does not address the fundamental issue of cost/benefit relationship.  The Six Cities reiterate their concerns with the absence (thus far) of cost/benefit data and urge the CAISO to focus efforts both prior to and immediately following EDAM implementation on evaluation of quantifiable benefits of IR procurement in relation to cost.

1. Please provide a summary of your organization's comments on the December 18, 2025 DAME Configurable parameters implementation working group discussion.

The Energy Authority (TEA) appreciates all the effort that went into the data analysis and presentation provided to stakeholders at the December 18, 2025, and prior meetings. We understand that the task of assessing the potential impact of configurable parameters decisions is a difficult one and respect that CAISO staff do not have all the information they would need to replicate or accurately forecast the financially binding market results that CAISO Load and Gen SC's across the EDAM footprint will be subject to on May 1, 2026. 

Based on the study results to date, the known-unknowns regarding product performance, and the apparent lack of confidence in the ability for the market to solve consistently and expediently with the granular inputs the products were designed to leverage, TEA does not believe it is appropriate or beneficial to the market as a whole for CAISO to launch EDAM with the new DAME products. TEA instead would like to see CAISO gather 6-12 months of market data, refine models and constraints, and then insert the new products (1) after their impact has been studied with live EDAM results and (2) after ensuring CAISO's systems can perform the market solving task with the level of granularity needed to achieve the products' targeted outcomes. TEA understands though that making this determination is not within the scope of this immediate effort and that it would require signicant redesign of the EDAM RUC process and significant Tariff amendment coordination, which is simply not feasible at this late stage if the May 1, 2026, go-live deadline remains in place. 

TEA therefore suggests that the CAISO leave the DAME products in place but pivot to solving for a different objective function for them in the time remaining before market go-live: limiting the impact of the DAME products over the first 6-12 months of market operations wherever possible - such as setting lower procurement targets through a reduced confidence interval, aggregating nodal procurement to the BAA-level and ignoring sub-BAA constraints, minimizing deployment factors, etc.. TEA recommends the CAISO assess and commit to the updated objective as quickly as possible, and then follow through with the identified changes to the parameters in the BPMs and market software prior to Parallel Operations or at a minimum no later than 30-days prior to go-live.

2. Please provide a summary of your organization's comments regarding the discussion on Analysis #3 results – Set of enforced constraints.

TEA requests CAISO further explain the impact of EDAM transfer constraints on the solution and utility of the products in the market. This should include the assumed volume of transfers at the interface point between PacifiCorp West and CAISO, between PacifiCorp West and PacifiCorp East, and between PacifiCorp East and CAISO (to the extent the Mona intertie will be open for IR/RC optimization). TEA would like to better understand as well whether and how the enaction of a Net EDAM Transfer Constraint (NETC) at the EDAM BAA level will impact market results, including in light of EDAM transitionary pricing rules in place for the first six-months, or longer, of EDAM operation.

3. Please provide a summary of your organization's comments regarding the discussion on updates to benchmark setup and associated market results.

N/A

4. Please provide a summary of your organization's comments regarding the discussion on Sensitivity analysis #4 results - Proportion of deployed reserves.

Consistent with the position stated above that CAISO's objective from here should be minimize the impact of these products, TEA requests CAISO further test a significantly reduced deployment factor in combination with a significantly reduced IR/RC procurement target.

5. Please provide any additional comments.

N/A