Provide summary of your organization’s comments on the Flexible Ramping Product Refinement design to isolate and limit base transfers into the failed Western EIM Balancing Authority Area (BAA):
During the May 10, 2022, stakeholder call CAISO presented on a reliability issue that would result from a potential tariff change to implement the Board approved Flexible Ramp Product (“FRP”) Enhancements prior to implementation this Fall 2022. While NV Energy and PacifiCorp appreciates that the CAISO has brought this item forward on a stakeholder call rather than move to implement such a fundamental departure from the current failure consequences of the EIM resource sufficiency evaluation (RSE). NV Energy and PacifiCorp are concerned that CAISO did not recognize the significant reliability risk that would result from the proposal and did not highlight the potential consequences to stakeholders or to the Board during the stakeholder process. We share the concern that the analysis, record and communication around this proposal has been insufficient and falls short of the CAISO’s own stakeholder engagement standards.
Under Section 15 of the CAISO Tariff, any amendment or other modification of any provision of this CAISO Tariff must be in writing and approved by the CAISO Governing Board in accordance with the bylaws of the CAISO. The Board did not approve a change to the failure consequences of the RSE as this was never presented to them. To the contrary, the Board Memo and Presentation stated a proposal to address a particular issue,
“The current design does not allow the market to consider locational constraints when procuring the flexible ramping product. This results in the market awarding the flexible ramping product to resources that may not be fully deliverable when and where uncertainty materializes.” 
The proposed response was to implement nodal procurement of the flexible ramp product. This sounds reasonable, but there was never a discussion of any implication on RSE failure consequences and certainly not identification that CAISO’s proposed implementation would restrict EIM Transfers as a result of RSE failures.
To be clear, a proposal to limit an EIM Entity to base transfers is a fundamental change in how the concept of a freeze has been implemented since the start of the EIM. As such it was incumbent on CAISO Staff to fully explain the change and potential reliability consequences to the Board. It cannot simply be thrown-in as an after-the-fact thought on additional tariff language. Furthermore, the CAISO has a duty as the market operator to identify and mitigate any negative consequences associated with its initiatives. Stakeholders have different interests and responsibilities and not all are responsible for Balancing Authority Area operations.
On May 18, 2022, CAISO published an implementation update that included a proposed solution to this reliability issue. As NV Energy and PacifiCorp understand the proposal, this proposed solution would keep the current RSE failure mechanism in place for the EIM dynamic transfers while restricting the FRP deployment into Balancing Authority Areas that have failed the RSE. If this understanding is correct, then no change is necessary for tariff section 29.34.n.1.B..
“the CAISO will hold the EIM Transfer limit into or from the EIM Entity Balancing Authority Area or the CAISO Balancing Authority Area, as specified in Section 29.34(n)(2), at the value for the last 15-minute interval.” 
However, if this understanding is not correct and this solution would result in any changes to the RSE failure that reduces the transfers to the failed RSE Entity then those changes must be presented to the Board for consideration. Thus, if the proposed solution rectifies the reliability issue and maintains the spirit of the proposed FRP enhancements without the need to make any additional tariff changes, then the CAISO should move forward implementing the FRP enhancements this Fall with this proposed solution. It is important to note, that NV Energy and PacifiCorp will not support the current Board approved FRP enhancements without a solution for this reliability issue and will protest any filing at FERC.
A proposal to limit an EIM Entity that fails to the base schedule transfers only would be a violation of good utility practice. Rather than using the market as a powerful reliability tool to provide assistance to an EIM Entity under stressed conditions at an appropriate price, this change would exacerbate the existing flaw in the current design by taking additional transfers away from the EIM Entity that failed the RSE, thereby increasing the reliability challenge. Moreover, there has been no study and demonstration by CAISO that EIM Entities have the ramping capabilities to recover from such a direct and immediate challenge. There has been no data that identified the maximum volume of EIM Transfers that could be lost and no review of how reliability could be maintained.
 CAISO. September 30, 2020. “Memorandum: Decision on flexible ramping product refinements proposal.” DecisiononFlexibleRampingProductRefinementsProposal-Memo-Sept2020.pdf (caiso.com). Accessed May 23, 2022.
 CAISO. April 1, 2022. “California Independent System Operator Corporation Fifth Replacement FERC Electric Tariff (Open Access Transmission Tariff) Effective as of April 1, 2022”. Conformed-Tariff-as-of-Apr1-2022.pdf (caiso.com). Accessed May 23, 2022.
Provide your organization’s comments on the proposed tariff change to section 29.34.n.1.B, and the potential impact to the WEIM Resource Sufficiency Evaluation:
The revised draft tariff language that was posted on March 15, 2021, did not contain any proposals to this section of the tariff. NV Energy and PacifiCorp have not seen any proposed changes to the revised draft tariff language for this section of the tariff.
As noted above, the potential proposed change to 29.34.n.1.B presented a reliability challenge to EIM Entities currently participating in the EIM. If CAISO pursues revisions to this section of the tariff, then these proposed changes must be taken to the Board for a vote as it would represent a fundamental change in the current RSE failure consequences and has not been explained to and approved by the Board.
Please provide your organization's comments on the potential conflict between the FRP design of isolating failed WEIM RSE BAA’s and the proposed scope of WEIM Resource Sufficiency Evaluation Enhancements Phase 2:
A properly designed and administered market works to improve reliability by using market prices to incent supply when and where needed at an appropriate price. On the other hand, poorly designed and administered markets can threaten reliability posing unwarranted risks of outage and causing a loss of confidence in the overall market design by participants, customers, and regulators. The proposal to limit EIM dynamic transfers into the EIM Entity that fails the RSE was fundamentally flawed. At a time when CAISO is focusing in both EIM and EDAM on using prices as a means to address shortage conditions, the unwarranted regression to not only artificially limit incremental EIM Transfers to the distresses EIM Entity but to exacerbate the shortfall by “zeroing-out” the previously relied on supply represents an inappropriate reliability change in violation of good utility practice.
The RSE Enhancements Phase 2 should continue to the work that was being developed under the RSE emergency actions workshop to develop an enhancement that prevents blackouts with financial consequences to be implemented prior to Summer 2023.
Provide any additional comments: