Comments on Revised draft tariff language

1. Please provide any redline changes and embedded comments your organization may have on the Extended Day-Ahead Market revised draft tariff language as an attachment to this comment template, and provide any additional comments in the text box below: *

When providing additional comments in the text box below, please specify the section(s) or subsection(s) your comments refer to.

ACP-California appreciates the opportunity to provide comments on the Extended Day Ahead Market (EDAM) revised draft tariff language put forth by CAISO on June 8 (and the small, but important, update to Section 33 posted on June 13). ACP-California continues to support EDAM’s implementation as a significant step in better integrating power markets in the West. We believe CAISO has taken several steps in these revisions to the tariff language to better address a number of our concerns, such as modest improvements to how a generator that owns transmission rights and is contracted to California (or other external) LSEs can provision its transmission to EDAM and transfer the Resource Sufficiency attributes to CAISO. We also appreciate the elimination of references to “unreserved use” transmission charges in Section 33.23 in the updated posting of Section 33 on June 13^th. However, we continue to be concerned about certain aspects of the revised draft tariff language, as outlined below and hope for additional discussion on these items as EDAM implementation moves forward. Although these comments will primarily focus on elements of the Revised Draft Tariff that differ from the Draft Tariff, we will also reiterate points made in prior comments that have not yet been addressed or broadly discussed. We recognize some of these comments may not be addressed directly in the EDAM tariff and/or may need to be evaluated in future stakeholder processes related to EDAM implementation and enhancements but urge CAISO to take them up as soon as possible.

In addition to these comments, ACP-California has included limited redlines to Section 33 in the attached document.

We look forward to continuing to work with the CAISO and other stakeholders to move EDAM forward in an expeditious manner and to continuing to explore for places where the design and tariff language can be improved and provide meaningful benefits.
 

Specific Tariff Changes Recommended by ACP-California

Inter Scheduling-Coordinator (Inter-SC) Trades are necessary and beneficial for EDAM and should be enabled in Section 33.28

ACP-California supports CAISO enabling the use of Inter-Scheduling Coordinator Trades in EDAM footprint and, therefore, has recommended changes to Section 33.28 of the CAISO tariff. While we recognize that these trades are not currently allowed in the Western EIM, we believe they would provide an essential and beneficial functionality in a day-ahead market paradigm and should be enabled in EDAM.

Inter-SC trades (or their equivalent in other markets) can be used to facilitate more efficient bilateral settlements and facilitate different contracting structures. For instance, they may be used by corporate offtakers and the generators they contract to provide better settlements under virtual PPAs. The EDAM design addresses potential concerns around potential cost shifts from these types of contracting structures by implementing a transmission requirement for EDAM Resources and, in the absence of a generator meeting that requirement, a charge the EDAM Transmission Service Provider would assess. Given this, ACP-California does not understand the need to prohibit these trades in EDAM nor the reasoning for doing so.

At a minimum, CAISO should support further discussion on this topic and any logic/justification for not enabling this functionality in EDAM prior to a complete prohibition on Inter-SC Trades in EDAM being filed at FERC. But ideally, the tariff can be modified to simply enable these transactions in EDAM in the same manner as they are enabled in the CAISO BAA.

CAISO should consider changes to Section 33.23 to enable EDAM Transmission Service Providers to use a non-firm hourly charge when a transmission charge is applied to EDAM Resources and to prevent double charging for transmission

As ACP-California has mentioned in previous comments, we believe the uniform use of an hourly charge, in instances when an EDAM Transmission Service Provider assesses a charge to an EDAM Resource under Section 33.23, is highly preferable to what is currently proposed which gives the optionality for a daily or hourly charge. Uniform use of an hourly charge would have significant consistency and efficiency benefits for those participating in the market and would provide more certainty to generators offering in to the market that might be exposed to this charge when accounting for it in their EDAM offers. Generators cannot easily incorporate the daily transmission cost into their hourly bids with any certainty and may need to increase their bids to address the uncertainty as to how many hours they may be dispatched by the market to spread out recovery of this charge.

ACP-California has commented on this before and recognizes that CAISO has declined to limit this to charge an hourly charge by EDAM Transmission Service Providers. However, we understand that some EDAM Entities may be open to utilizing an hourly non-firm charge in these instances. And there is no reason that the charge must be for firm transmission service and should be limited to such by the CAISO tariff. Thus, ACP-California recommends that CAISO change the language in Section 33.23 of the Tariff to not specify that the charge should be for firm transmission and, therefore, to allow EDAM Entities the flexibility to implement a non-firm hourly transmission charge for these instances.

Additionally, CAISO should modify Section 33.23(b) to not specifically require “firm” transmission service for EDAM participation in order to not be assessed an incremental transmission charge. As currently written, we are concerned that an EDAM Resource may have acquired non-firm transmission service from the EDAM Transmission Service Provider to enable a bilateral transaction. But that bilateral transaction would still be a form of EDAM participation and the resource could both pay for non-firm transmission service and be assessed an hourly or daily transmission charge for EDAM participation by the EDAM Transmission Service Provider. This would be an impermissible double charge for transmission and should not be enabled by the CAISO tariff. We, therefore, recommend striking the term “firm” from Section 33.23(b).

Ongoing Policy Issues & Discussion Items

EDAM would benefit from the inclusion of key policy provisions in the Revised Tariff Language

In the EDAM Final Proposal, CAISO included a key policy provision to address concerns about the use of transmission rights between the day-ahead and real time. Specifically, CAISO stated that, as part of the EDAM design, EDAM Transmission Service Providers should “to the extent feasible” hold all firm point-to-point and NITS customers harmless from the EDAM transfer and congestion costs incurred in scheduling on transmission rights between the EDAM scheduling deadline and real-time. By including language in the policy proposal CAISO signaled its commitment to maintaining the value of holding transmission rights and reducing the likelihood of cost-shifts. While we continue to believe that CAISO could improve market efficiency by providing more standardization through the inclusion of this policy provisions in the EDAM tariff, we understand that CAISO has reviewed ACP-California’s comments and opted not to adopt this recommendation at this time. However, due to the importance of achieving this design in practice, we hope that CAISO will explore modifications to this language, if shown to be needed, as EDAM moves to implementation and expansion.

CAISO should host additional discussions with stakeholders on how demonstrating transmission delivery to CAISO for RPS compliance will work within the EDAM paradigm

Since the beginning of the EDAM stakeholder process, ACP-California (formerly AWEA-California) has requested details on how renewable resources that currently deliver to CAISO, and are contracted to provide Portfolio Content Category (PCC) #1 energy under the California RPS, can continue to demonstrate their delivery to CAISO (and qualify as PCC#1) under the EDAM paradigm. Through discussions with the CAISO team, we understand that CAISO foresees this continuing to function much as it does today within EDAM through a “bucket 1 transmission” EDAM transfer. The transmission used to support delivery of this resource will become part of a “bucket 1 transmission” EDAM transfer and, as such, there will be an e-Tag that can demonstrate delivery of the specific resource to CAISO. As discussed below, we hope CAISO can expand this same functionality to bucket 2 transmission EDAM transfers (to provide transmission customers more options and direct relationships with CAISO under EDAM). But, additionally, ACP-California requests that CAISO provide stakeholders with additional information and examples of how delivery for PCC#1 compliance will be demonstrated in EDAM. We also request that CAISO and the CEC host a joint workshop to explore the issue and ensure that, if modifications to any rules are required, they can be implemented ahead of when EDAM goes live.

CAISO should explore modifications to the “bucket” structure to enable Transmission Customers that use their transmission to deliver resources from one EDAM BAA to another, to better use the “Bucket 2” pathways to do so

ACP-California appreciates that the CAISO EDAM team has taken time to discuss the functionality of the transmission buckets with stakeholders during this process and in one-on-one conversations. As we currently understand transmission provision in EDAM, if a Transmission Customer that today owns transmission rights to export a resource out of an EDAM BAA to another BAA (where their offtaker is located), wants to use those rights in EDAM to “transfer” the RSE attributes of their resource to the BAA where their offtaker resides, they have limited options for doing so. They could do so by communicating through the EDAM Entity and their transmission will become part of a “bucket 1” transfer. Or they can self-schedule the resource using the provisions outlined in Section 33.18.2.2.1. ACP-California is concerned that, if Transmission Customers are not provided more options, many may choose to self-schedule (via Section 33.18.2.2.1) these resources to their offtakers which will unnecessarily reduce the benefits and economic efficiency of EDAM.

We are concerned that customers in this situation may not want to use the “bucket 1” transfer option for their resource because by going through the bucket 1 transfer, they become subject to settlement of congestion and transfer revenue with the EDAM Entity (and not directly with CAISO). The process for allocation of these revenues from the EDAM Entity to transmission customers is not known at this time and, in experience with the EIM, Transmission Customers have found the allocation mechanisms of EIM Entities problematic and disconnected from their specific use of the transmission system and, thus, not a reliable hedge for congestion. Given this, we are concerned that Transmission Customers in this situation will not want to participate in a bucket 1 transfer through the EDAM Entity. Thus, they may be incented to, instead, self-schedule their resources and transmission under Section 33.18.2.2.1.

ACP-California believes that if these customers could, instead, use Section 33.18.2.2.2, which provides for a direct settlement relationship of congestion/transfer revenue with CAISO, they would do so and would offer their resources into EDAM on an economic basis. We therefore recommend that CAISO continue to explore how this could be enabled within EDAM in order to maximize economic participation of resources and market benefits.

1. Please provide any redline changes and embedded comments your organization may have on the Extended Day-Ahead Market revised draft tariff language as an attachment to this comment template, and provide any additional comments in the text box below: *

When providing additional comments in the text box below, please specify the section(s) or subsection(s) your comments refer to.

Arizona Public Service (APS), Salt River Project Agricultural Improvement and Power District (SRP), and Tucson Electric Power (TEP), collectively referred to in this document as the Arizona Utilities, appreciate the opportunity to comment on the CAISO Extended Day-Ahead Market (EDAM) revised draft tariff, posted on June 8, 2023. The Arizona Utilities would like to thank the CAISO for its efforts thus far on the EDAM development, including the development of this iteration of the draft tariff.

These comments supplement comments the Arizona Utilities’ previously submitted, individually and collectively, to the CAISO and the Joint Governing Bodies on the EDAM draft tariff and EDAM related matters. Governance, resource adequacy, price formation and fast start pricing, and transmission wheel through remain important, unresolved areas that the Arizona Utilities and others have been emphasizing for multiple years without resolution. The Arizona Utilities feel these areas are critical to participation in EDAM.

In addition, the Arizona Utilities here provide (1) high-level comments in three areas that the Arizona Utilities seek cooperation from the CAISO to resolve prior to EDAM go-live, and (2) redline edits to a section of the EDAM draft tariff.

Fuel Limited Resource Management

The Arizona Utilities have a finite amount of gas that can be procured daily and limited transportation rights that can be utilized for serving native load and participating in the wholesale market. Market mechanisms are not yet established to provide the tools for these entities to fully manage those limited fuel sources in a reliable and economic manner. The Arizona Utilities’ concerns are that if the gas scheduling challenges are not resolved then EDAM may create substantial operational risk to gas scheduling and pipeline reliability serving Arizona resources or create substantial risk that the real cost of using gas resources in the market would not be recoverable in EDAM. This would result in an expense paid by Arizona customers to the benefit of the broader West instead of the collective costs and benefits being shared by EDAM participants. Numerous discussions have been held with the CAISO and other stakeholders to develop solutions with only minor changes to date. These challenges and recommendations were most recently discussed and presented by APS and SRP (“Southwest Entities”) at the Regional Issues Forum on June 21, 2023 (presentation slides can be found at https://www.westerneim.com/Documents/Presentation-RIF-Gas-Panel-APS-SRP-06212023.pdf). The CAISO has committed to hosting additional workshops with the hope that concrete steps can be taken to alleviate these critical concerns. The Arizona Utilities expect the CAISO to work earnestly with the Arizona Utilities to identify a solution and improvements to the challenges associated with gas scheduling.

Seams Mitigation

As market footprints in the West materialize and transform, seams agreements between markets will be important components of day-ahead markets. The Arizona Utilities seek a commitment from the CAISO to work with Southwest Power Pool on seams agreements to minimize the impact of seams between markets.

Western Resource Adequacy Program (WRAP) Interoperability

The CAISO should demonstrate a commitment to work closely with Western Power Pool to address interoperability between WRAP and EDAM. The CAISO should maintain a willingness to revise its market design and draft tariff language to accommodate entities participating in both programs. This would support market participants as they work to meet resource adequacy requirements and achieve intended goals of enhanced reliability.

Lastly, upon review of the new Appendix B.XX Transmission Service Provider Agreement (EDAMTSPA), the Arizona Utilities offer the following redline edits to Article III. Term and Termination. The redlines clarify that the 30-day process should not begin until the Dispute Resolution outlined in the tariff has run its course. Also, consider defining “material default” in the same section.

3.2.1 Termination by CAISO.  Subject to Section 9.2, the CAISO may terminate this Agreement by giving written notice of termination in the event that the EDAM Transmission Service Provider commits any material default under this Agreement and/or the CAISO Tariff which, if capable of being remedied, is not remedied within thirty (30) days after the CAISO has given, to the EDAM Transmission Service Provider, written notice of the default and the CAISO Dispute Resolution process has been completed, unless excused by reason of Uncontrollable Forces in accordance with Article IX of this Agreement.  With respect to any notice of termination given pursuant to this Section, the CAISO must file a timely notice of termination with FERC, if this Agreement was filed with FERC, or must otherwise comply with the requirements of FERC Order No. 2001 and related FERC orders.  The filing of the notice of termination by the CAISO with FERC will be considered timely if: (1) the filing of the notice of termination is made after the preconditions for termination have been met, and the CAISO files the notice of termination within sixty (60) days after issuance of the notice of default; or (2) the CAISO files the notice of termination in accordance with the requirements of FERC Order No. 2001.  This Agreement shall terminate upon acceptance by FERC of such a notice of termination, if filed with FERC, or thirty (30) ninety (90) days after the date of the CAISO’s notice of default, if terminated in accordance with the requirements of FERC Order No. 2001 and related FERC orders. 

The Arizona Utilities thank the CAISO staff for their continued engagement and look forward to continuing to collaborate and reach consensus on paths forward.

1. Please provide any redline changes and embedded comments your organization may have on the Extended Day-Ahead Market revised draft tariff language as an attachment to this comment template, and provide any additional comments in the text box below: *

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The Balancing Authority of Northern California (BANC) is pleased to submit these supportive comments on the continued development of the Tariff language for the Extended Day Ahead Market.  

BANC appreciates the work that the CAISO and stakeholder have put in on the development of Tariff language.  It is clear through the extra time allotted to develop the Tariff before filing at FERC has improved the work product and allowed alignment with other processes such as the Day Ahead Market Enhancements.

BANC joins several of the other stakeholders in supporting the direction of the EDAM design.  The Tariff development reflects the core design principles as approved by the CAISO Board of Governors and EIM Governing Body through the exercise of Joint Authority.  BANC greatly appreciates the detailed Tariff suggestions made by several parties (Six Cities, PacifiCorp, NV Energy, to name a few) that help improve the ultimate filing at FERC.

We are concerned that a limited number of stakeholders appear to be revisiting fundamental principles of design such as how Open Access Transmission Tariff (OATT) are honored in the market, or firmness of transfers in the EDAM, have been well vetted through the Working Group and stakeholder processes.

BANC urges the CAISO to stay the course and maintain the core market design principles.  Like most market issues, stakeholders and the CAISO will learn from the operation of the market and be able to consider future adjustments if needed based on market performance.  Now, it is critical that the CAISO adhere to the core approved market tenets in its filing at FERC.

1. Please provide any redline changes and embedded comments your organization may have on the Extended Day-Ahead Market revised draft tariff language as an attachment to this comment template, and provide any additional comments in the text box below: *

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The complete text of DMM's comments is included in this response to question 1.  For a fully formatted version of DMM's complete comments, please see the PDF version attached below.

Comments on Extended Day-Ahead Market Revised Draft Tariff Language

Department of Market Monitoring

July 24, 2023

Comments

The Department of Market Monitoring (DMM) appreciates the opportunity to comment on the Extended Day-Ahead Market – Revised Draft Tariff Language.[1] 

Section 33.7.5 EDAM Transfer Priority Relative to Demand

Language in this section states, “EDAM Transfers will have a priority equal to Demand in the EDAM Area.”  DMM’s understanding of the intended policy for prioritizing between EDAM Area Demand and EDAM transfers in real-time is that there is a difference between how the real-time optimization software will prioritize between demand and EDAM transfers and how operators in an EDAM Area that has to curtail load and/or EDAM transfers will prioritize between demand and EDAM transfers.

The equations defined in Appendix 3 of the EDAM Final Proposal specify how the real-time optimization software will prioritize between each area’s demand and EDAM Transfers.[2] DMM’s understanding of these equations is that when system-wide real-time supply cannot meet real-time demand, the software will assign the power balance violation to the EDAM Area whose supply is insufficient to meet its real-time demand plus net EDAM transfers out.  The real-time software will not assign power balance violations to EDAM Areas that may have insufficient supply to meet demand in the absence of EDAM Transfers in from other areas, but which have sufficient supply to meet demand with the addition of all net EDAM energy, IRU, and RCU Transfers in.  Therefore, the EDAM policy defined by the Final Proposal has the real-time market software assigning a higher priority to EDAM Transfers than to Demand in an EDAM Area.

The tariff language in this section 33.7.5 seems to accurately describe the Final Proposal policy for how an EDAM balancing area’s operators should prioritize between EDAM Transfers and Demand if the balancing area assigned the power balance violation by the real-time software actually has to curtail either load or EDAM Transfers. 

However, DMM has not identified tariff language that defines the policy for how the real-time optimization software will prioritize between Demand and EDAM Transfers.  DMM believes the policy defined in the Final Proposal that clarifies that the software will prioritize EDAM Transfers over Demand is an important aspect of the overall EDAM policy.  DMM recommends that the ISO identify where this policy is specified in the Revised Draft Tariff Language, and to add such language if it does not currently exist.

Section 33.30.8.3 Non-Source Specific E-Tag Requirements

Bids and schedules that can cure untagged non-resource specific import awards

Revised draft tariff language in this section states:

“An EDAM Entity Scheduling Coordinator will have until 5 hours before the start of the Operating Hour to submit E-Tags and/or replace the capacity with other firm schedules or physical resources for schedules that lack a valid Day-Ahead E-Tag within the timeframe. If the EDAM Entity Scheduling Coordinator does not E-Tag the outstanding import schedules, including import EDAM Transfers, and fails to resupply by submitting additional incremental Energy Bids from internal supply EDAM Resources above the resource’s Day-Ahead Schedule not encumbered by Day-Ahead capacity awards to cover the E-Tag insufficiency prior to the deadline, the CAISO will remove the EDAM Entity Balancing Authority Area from the group of Balancing Authority Areas that comprise the EDAM Upward Pool”

DMM supports the ISO clarifying that firm schedules, or bids from specific resources in excess of day-ahead energy, IRU, and RCU awards, can count towards curing untagged non-source specific imports.  DMM noted in prior comments on EDAM policy that ambiguity in the Final Proposal language seemed to leave open the possibility of only counting real-time bids in excess of day-ahead market bids.  Counting real-time bids in excess of day-ahead awards, as clarified in the tariff language, resolves this potential ambiguity.

Clarifying which EDAM BAA is responsible for an untagged non-resource specific import that was supposed to wheel through one EDAM BAA to count towards the EDAM RSE of another EDAM BAA

If a non-resource specific import contracted to count towards an EDAM BAA’s EDAM RSE requirement schedules on the border of that EDAM BAA, EDAM policy and tariff language is clear that this EDAM BAA will bear the consequences of that import not tagging by the start of the STUC run.  However, consider a scenario of a non-resource specific import that counts towards one EDAM BAA’s EDAM RSE.  Now assume that this non-resource specific import is ultimately supported by an import into a second EDAM BAA that is wheeled through that second EDAM BAA using Bucket 1 transmission and then imported into the first EDAM BAA, which counts this import as EDAM RSE supply.  In this scenario, the EDAM policy in the Final Proposal and tariff language is not clear on which of the two EDAM BAAs will bear the consequences of the import failing to tag by the start of the STUC run.

DMM’s current understanding of the planned implementation of supply using Bucket 1 transmission from EDAM BAA 2 to count towards the EDAM RSE requirements of EDAM BAA 1 is that the ISO will simply increase the EDAM RSE requirement of EDAM BAA 2 and decrease the EDAM RSE requirement of EDAM BAA 1.  In this wheel-through scenario, this would imply that the consequences for the import failing to tag would fall on the EDAM BAA that the import is simply wheeling through (EDAM BAA 2 in this example).  DMM questions whether this would be the most appropriate policy. 

DMM recommends that the ISO clarify in the EDAM tariff language which EDAM BAA will bear the consequences of the untagged import in this scenario.  Each EDAM BAA will need to develop policy for addressing possible untagged non-resource specific imports wheeled through its BAA, and this policy will depend on which BAA is responsible for the consequences of the import failing to tag.  

Clarifying implications of a non-resource specific import counted towards EDAM RSE but that ultimately tags its source as being from an EDAM BAA

The Straw Proposal in the EDAM ISO BAA Participation Rules initiative contemplates the possibility of a non-resource specific import counted towards an EDAM BAA’s EDAM RSE.  The ISO would model the import as a distributed injection at the sink BAA’s Demand Aggregation Points.  The proposal then describes the policy for how the real-time market would treat such an import, if the import ultimately sourced from within the EDAM footprint:

In the real-time market, once the source of the supply is known, the scheduling coordinator would be expected to submit a bid at the resource if the source supporting the firm delivered energy is located within the EDAM footprint. The scheduling coordinator would be expected to cancel the DA schedule at the resource in the EDAM footprint through a base transfer deviation with the ISO at the applicable interface between EDAM areas. This base transfer associated with the resource in the footprint would contribute to the ISO WEIM RSE.[3]

DMM recommends the ISO clarify this policy for any EDAM balancing authority area that has day-ahead market schedules from non-resource specific imports.  If a non-resource specific import tags as ultimately being sourced from within an EDAM BAA, it seems reasonable to automatically set the real-time tagged energy amount on the import resource that cleared the day-ahead market to 0 MWs, forcing the importer to buy back the day-ahead cleared quantity at the relevant real-time market price.  This could also expose the importer to each EDAM balancing area’s penalties for failing to tag an import.  It is not clear if this is the intended EDAM policy.  It is also not clear how the EDAM and WEIM implementation will adjust to allowing the power in this scenario to count towards the WEIM RSE of the EDAM BAA that was the sink of the non-resource specific import, rather than towards the WEIM RSE of the EDAM BAA that is ultimately tagged as the source.  EDAM BAAs will need to develop rules in their tariffs to account for the potential of being the import source or sink in this scenario.

Section 33.18.4.1 Wheels Through

The revised draft tariff language states:

Supply wheeled through the CAISO Balancing Authority Area and accounted for in the EDAM Resource Sufficiency Evaluation must demonstrate establishment of a Wheeling Through transaction across the CAISO Controlled Grid and have designated transmission service under Section 33.18.2.1 into an EDAM Entity Balancing Authority Area and on the CAISO Controlled Grid Section in accordance with Section 23 and Appendix L. (Emphasis added)

The term “Wheeling Through” is a tariff defined term, but does not indicate high-priority wheel through.  Should this section reference a high-priority wheel through?  Can other BAAs in EDAM rely on an LPT wheel across CAISO to meet the EDAM RSE?  Policy on page 8 of the EDAM Final Proposal implies that a PT wheel is required for the bucket 1 transmission across the CAISO balancing area that is necessary for the supply to count towards the receiving EDAM balancing area’s resource sufficiency evaluation.

Section 33.32 Greenhouse Gas (GHG) and Section 29.32 Greenhouse Gas Regulation and GHG Bid Adders

DMM recommends the ISO carefully review these sections again for instances where the tariff language specifies resources “within the CAISO Balancing Authority Area” for whether it would be more appropriate to specify EDAM resources within the state of California.  There are balancing authority areas in the state of California besides CAISO that are currently in the WEIM and that may join EDAM. Therefore, some instances of the use of “CAISO Balancing Authority Area” in these sections may be currently incorrect.  Others may become incorrect as soon as a balancing authority area in California besides the CAISO joins EDAM.

[1] Revisions as of June 13, 2023 available at: https://stakeholdercenter.caiso.com/StakeholderInitiatives/Extended-day-ahead-market

[2] Extended Day-Ahead Market – Final Proposal, CAISO, December 7, 2022, pp. 136-137: http://www.caiso.com/InitiativeDocuments/FinalProposal-ExtendedDay-AheadMarket.pdf

[3] Extended Day-Ahead Market ISO Balancing Authority Area Participation Rules – Issue Paper and Track A1 Straw Proposal, CAISO, May 5, 2023, p. 29: http://www.caiso.com/InitiativeDocuments/IssuePaper-TrackA1StrawProposal-EDAMISOBAAParticipationRules.pdf

1. Please provide any redline changes and embedded comments your organization may have on the Extended Day-Ahead Market revised draft tariff language as an attachment to this comment template, and provide any additional comments in the text box below: *

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CEBA is a national association of large-scale energy customers seeking to procure clean energy across the U.S. With 434 members across the commercial and industrial sectors, non-profit organizations, as well as energy providers and service providers, CEBA’s members are working to create a resilient, zero-carbon energy system. CEBA and its members are engaging with regulators, grid operators and others in the west on market design and governance issues in emerging organized wholesale markets. CEBA supports these efforts to increase regional coordination through well-designed and well-implemented organized wholesale markets. Furthermore, CEBA is committed to achieving a 90% carbon free electricity system by 2030 and well-functioning organized wholesale markets are a vital piece of the puzzle.

CEBA supports CAISO’s overall approach to the EDAM tariff design posted on June 8, 2023 and believes it is a positive step towards supporting the ability of large energy customers to access low cost, reliable clean energy in the West. One general issue we would like to flag and work with CAISO on as the EDAM moves into fuller development is the potential for some enhancements that would better support the ability of large energy customers to work with developers on virtual purchase power agreements (vPPAs) for clean energy. Specifically, steps that can be taken in the EDAM market to create new trading hubs, support adoption of convergence (virtual) bidding provisions within all balancing areas and between areas to the extent feasible, and support finsched transactions (referred to in CAISO as Inter-Scheduling Coordinator Trades) would enhance the value that EDAM can provide to large energy customers, clean energy developers and, in our opinion, to all participants in the EDAM market. We look forward to continued engagement with CAISO on this draft tariff and these future market enhancements.

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Idaho Power appreciates the opportunity to comment on the Extended Day-Ahead Market (EDAM) revised draft tariff provisions and appreciates CAISO’s consideration of its previous comments and those of other stakeholders.  The revised EDAM tariff provisions are a meaningful improvement. Idaho Power submits these additional comments to assist the CAISO in further improvement of the EDAM tariff provisions.

Comment 1:  Section 11.5.4.1.1. Real-time Imbalance Energy Offset:  Clause (a), “Financial Value of EIM Transfers,” should be revised to exclude the word “System” from “System Marginal Energy Cost” to reflect that the defined term has been changed from “System Marginal Energy Cost” to "Marginal Energy Cost.” 

The revision should appear as follows:

“(a)      Financial Value of EIM Transfers.  For each Balancing Authority Area in the EIM Area, the CAISO will calculate the Real-Time Market financial value of EIM Transfers as the product of the EIM Transfer MWh, either positive or negative, and the System Marginal Energy Cost.."

Comment 2: Section 33.10.4 Telemetry:  The text should be revised to clarify that the exception for facilities with a “rated capacity of less than ten (10) MW” applies to the “CAISO Controlled Grid”.  Other EDAM Entities that retain their role as a balancing authority area and a transmission provider may have different requirements.  The addition of the last sentence is helpful but should be edited to clarify that it applies to EDAM Resource Facilities “within the EDAM Entity’s Balancing Authority Area”.  Together these edits ensure that the provisions work together and are not inconsistent.

The revision should appear as follows:

“Section 33.10.4 Telemetry:   

[. . .] An EDAM Resource Facility within the CAISO Controlled Grid will be exempt from this Section 33.10.4 if it has a rated capacity of less than ten (10) MW, unless it is certified by the CAISO to provide Ancillary Services.  For purposes of this calculation, aggregated resources will calculate their aggregated capacity and provide telemetry at the aggregate level.  EDAM Resource Facilities within the EDAM Entity’s Balancing Authority Area must comply with any EDAM Entity or Local Regulatory Authority requirements in addition to this Section 33.10.4.”

Comment 3:  Section 33.11.1.1.3 Reliability Capacity Transfer Revenue:  The text should be revised to remove a remaining reference to “practices to adjust costs among its transmission customers and measured demand."  In response to stakeholder comments this phrase was removed in other portions of Section 33.11.1.1.1, 33.11.1.2 and 33.11.1.3 and was missed in this instance.  By removing the phrase, the CAISO’s tariff simply requires the EDAM Transmission Service Provider’s tariff to provide the mechanism for suballocation without specifying the method of suballocation.

The revision should appear as follows:

“[. . .] An EDAM Entity will ensure that EDAM Transfer revenue for Reliability Capacity allocated to its EDAM Entity Scheduling Coordinator is further allocated by all applicable EDAM Transmission Service Providers as may be detailed in the EDAM Transmission Service Provider tariff and business practices to adjust costs among its transmission customers and measured demand.  [. . .]” 

Comment 4:  Section 33.18.2 Transmission at EDAM Internal Interties:  The text should be revised to remove the reference to “in hourly increments” when describing the transmission that must be acquired to support an EDAM Transfer.  The minimum increment that can be purchased will depend upon the transmission sold by the EDAM Transmission Provider.  For some transmission providers that increment will be “hourly” while for others it will be “daily”.  For example, the minimum increment of transmission service sold by Idaho Power is “daily.”  Idaho Power does not sell hourly transmission service.

The revision should appear as follows:

“[. . .] EDAM Transfers must be supported by firm or conditional firm point-to-point transmission service rights in hourly increments across an EDAM Internal Intertie, network integration transmission service associated with an import of a designated network resource across an EDAM Internal Intertie, or available transfer capability across an EDAM Internal Intertie.  [. . .]”

Comment 5:  Section 33.18.3.3 Transmission Not Available in the Day Ahead Market:  The text should be revised to remove “actual market” from the phrase “operational experience.”  The EDAM Transmission Provider retains its authority to provide transmission services and retains its responsibilities as a balancing authority area.  The EDAM Transmission Provider must be able to rely on its “operational experience” generally, and not be limited to “actual market operational experience.”

The revision should appear as follows:

“If the CAISO is informed through the prospective EDAM Entity implementation process or by the EDAM Entity Scheduling Coordinator for the EDAM Transmission Service Provider that, based on actual market operational experience, accommodating Self-Schedules accounting for incremental intra-day schedules in the Real-Time Market that were not scheduled in the Day-Ahead Market impacts market outcomes or reliability, the CAISO will accept a notification from the EDAM Entity Scheduling Coordinator associated with the EDAM Transmission Service Provider and will adjust Day-Ahead Market availability of the impacted transmission elements and the associated transmission service rights in accordance with the EDAM Transmission Service Provider tariff.”

Comment 6:  Section 33.23 Transmission Service Requirements for EDAM Resources:  The text should be revised to correct the spelling error “assesse”.  The correct spelling is “assess”.  Additionally, the text should be revised to delete the words “unreserved use” and add the phrase “(including unreserved use penalty)”.  These changes are suggested to clarify that transmission service utilized within the EDAM will be charged based on the EDAM Transmission Provider’s tariff.  Specifically, for the quantity of generation dispatched that is associated with the Real-Time Dispatch, the transmission customer will be assessed a transmission charge based upon the EDAM Transmission Provider’s tariff.  For the quantity of generation that exceeds the Real-Time Dispatch, the transmission customer will be assessed an unreserved use penalty, as provided for in the EDAM Transmission Provider’s tariff.  Idaho Power believes these edits will accomplish the objectives envisioned in the Final Proposal – Extended Day Ahead Market dated (Dec. 7, 2022) for compensating transmission providers for transmission services used in the EDAM.

The revision should appear as follows:

“[. . .] If the Real-Time Dispatch for any hour across the day is above the transmission reservation, the CAISO will notify the EDAM Entity associated with the EDAM Transmission Service Provider and the EDAM Transmission Service Provider will assesse assess the hourly transmission charge as described above.  This Section 33.23 establishes a common methodology for a Scheduling Coordinator to secure transmission service from a10.4n EDAM Transmission Service Provider.  The specific unreserved use transmission service requirements and any associated unreserved use transmission service charges (including unreserved use penalty) will be determined in accordance with the EDAM Transmission Service Provider tariff.”

Comment 7:  Section 33.30.9 Base Schedules:  It remains unclear what an EDAM Entity must submit and how the EDAM Entity must submit additional information in order to pass the retail-time sufficiency tests, should the EDAM Entity fails the EDAM resource sufficiency test.  This information could be provided for in the tariff or in its Business Practice Manual.

Comment 8:  Section 33.31.1.2 Components of EDAM RSE:  Idaho Power requests that the CAISO be vigilant to ensure that during the designation of EDAM Resources the same resource is not allowed to provide resource adequacy both within the CAISO BAA and within another EDAM BAA. 

Idaho Power has no additional comments at this time.

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LADWP EDAM REVISED TARIFF DRAFT COMMENTS

July 20, 2023

General Comments

The Los Angeles Department of Water and Power (“LADWP”) appreciates the opportunity to submit comments on the Extended Day Ahead Market (“EDAM”) revised draft tariff provisions released for stakeholder comment on June 8 and 13, 2023 (the “Revised Tariff Provisions”). LADWP appreciates the CAISO’s consideration of its previous comments and those of other stakeholders. The revised draft tariff provisions reflect considerable effort by the CAISO to respond to, incorporate, and balance stakeholders’ input regarding the original draft tariff provisions. LADWP looks forward to continuing to work with the CAISO and stakeholders.

LADWP reserves the right to provide additional comments as it continues to work through the Revised Tariff Provisions.

The Revised Tariff Provisions remain ambiguous regarding Transmission Service Provider’s role in administering its EDAM Legacy Contracts.

LADWP’s comments on the May 25, 2023 draft tariff (“Original Tariff Provisions”) expressed serious concern with allowing holders of transmission rights pursuant to EDAM Legacy Contracts to use their rights associated with those contracts to make transmission available in the EDAM. The Revised Tariff Provisions do not fully address LADWP’s concerns. Although the revisions properly increase the role of the EDAM Transmission Service Provider in managing the participation of EDAM Legacy Contracts in the EDAM over the Original Tariff Provisions, LADWP remains uncomfortable with the ambiguity in the Revised Tariff Provisions with respect to whether an EDAM Legacy Contract rights holder must seek consent, in all instances, from the EDAM Transmission Service Provider to make capacity available through the EDAM or at least to do so only as permitted under the EDAM Transmission Service Provider tariff.

For instance, Section 33.16.1 of the Revised Tariff Provisions continues to state that “CAISO will administer EDAM Legacy Contracts . . .,” ignoring requests from stakeholders for further clarification that the EDAM Transmission Service Provider will determine whether and how EDAM Legacy Contracts are administered. Likewise, Section 33.16.2 does not clearly state that that the EDAM Transmission Service Provider will determine which contracts are eligible for registration as an EDAM Legacy Contract. While this sentiment is expressed by the CAISO in a comment bubble, the text of the provision only calls for “coordination” between the EDAM Transmission Service Provider and/or the EDAM Entity and the EDAM Legacy Contract rights holder. Additionally, Section 33.18.2.2.2 allows the Scheduling Coordinator representing the transmission rights to “determine . . . whether to make the full amount or only a portion of its registered transmission service rights available for EDAM Transfers . . . .” This language does not take into account the requirements of the EDAM Transmission Service Provider tariff or the particulars of the agreement.

The Revised Tariff Provisions remain ambiguous with respect to the EDAM Transmission Service Provider’s control to implement its tariff.

LADWP and other stakeholders have asked the CAISO to recognize that an EDAM Transmission Service Provider must have unilateral authority to implement its tariff and comply with reliability obligations. Although the revisions improve on the Original Tariff Provisions, given the importance of this issue, LADWP believes that the CAISO Tariff must be revised further to remove any ambiguity.

For instance, Section 33.7.5 of the CAISO Tariff should state that “each EDAM Transmission Service Provider is solely responsible for curtailments within its transmission system as provided for in its tariff and applicable reliability requirements.” Each EDAM Transmission Service Provider, including the CAISO, is responsible for the transmission system it operates. The CAISO is not currently authorized to make curtailment decisions outside of the transmission assets that it operates, and the EDAM cannot inject ambiguity regarding this matter.

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General comments:

NIPPC recommends CAISO develop model tariff language for Transmission Service Providers to incorporate into their own tariffs as they implement EDAM.   NIPPC understands CAISO does not want to dictate practices to its participating Entities (BAAs) but facilitating a reasonable level of uniformity and consistency would benefit market participants.  CAISO should assert more oversight over the policies and procedures it is leaving for EDAM (and EIM) Entities to develop themselves. Developing model tariff language for Transmission Service Providers to consider would lead to more consistent and efficient implementation of the CAISO tariff by Transmission Service Providers across the EDAM footprint, without forcing Transmission Service Providers to incorporate specific language in their own tariff. CAISO model tariff language would also allow FERC to consider the merits of deviations from the model language in considering individual tariff filings from EDAM participants.

Here are two examples, one from each market:

                                    i.    EDAM – Regarding the adjustment described in Section 33.18.3.3, CAISO is leaving EDAM Entities to decide whether to adjust or not.  We believe EDAM Entities will need guidance about risks of infeasibility and at what level redispatch costs are excessive.  Our concern is, without guidance, EDAM Entities may rely too much on redispatch when unscheduled transmission is used in real-time (Section 33.18.1.4 - Permissible Intra-Day Transmission Schedule Changes) and accumulate unnecessary redispatch costs when the adjustment could be utilized to better effect.

                                   ii.    EIM – Currently settlement training, procedures, and practices are not uniform across all EIM Entities.  This results in, for example, widely varying supporting data that is made available for market participants to verify their EIM charges.  Establishing a standard level of settlement data, pushing it down to existing Entities, and incorporating it into EIM onboarding would significantly improve the settlement process.

Specific Comments:

Section 33.18.3.3.

1. 1. NIPPC believes any “adjustment” described in this section should only go in one direction, down. 
   2. CAISO appears to be pushing all the responsibility for these adjustments towards the EDAM TSP. How would the TSP use its tariff provisions to make this adjustment?  Does the CAISO intend to develop model tariff language for EDAM TSP’s to incorporate into their tariffs?

33.18.3.2 – NIPPC encourages CAISO to develop a process for assigning Contract Reference Numbers (“CRN”) for short-term firm transmission rights for terms of monthly duration down to hourly.  As described in preceding EDAM workshops, the Pacific Northwest market supports extremely active redirection of long-term service, often to hourly service, to accommodate everyday load service.  NIPPC believes that CAISO’s 5-day Masterfile process does not currently accommodate hourly service registration.

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NV Energy appreciates the opportunity to comment on the revised tariff language. The CAISO staff has put a great deal of effort into the draft EDAM Tariff.  Our limited comments are as follows:

• Section 33.2.5 requires the prospective EDAM Entity to execute any necessary agreements for operating as an EDAM Entity. Will there be a separate requirement for third-party load serving entities and generators in the EDAM Entity Balancing Authority Area to execute necessary agreements?

• Section 33.7.4.1 states that Administrative Prices apply only to the CAISO BAA, and that each EDAM entity would have an administrative price in its tariff per section 29. NV Energy believes it may be helpful to have a more precise cross-reference which we think would be 29.7(j)(2)(D)(i).

• Section 33.7.5 (proposed redlined changes to emphasize the curtailment instruction comes from the respective Balancing Authority/Transmission Provider)

EDAM Transfers will have a priority equal to Demand in the EDAM Area. If it is necessary for an EDAM Entity or the CAISO to reduce or suspend EDAM Transfers between one or more Balancing Authority Areas in the EDAM Area based on operational judgement and consistent with Good Utility Practice, the CAISO or the EDAM Entity may do so with respect to their respective Balancing Authority Areas, provided that the reduction or suspension is consistent with the EDAM Transmission Service Provider tariff or the CAISO Tariff, as applicable, and communicated to potentially impacted Balancing Authority Areas in the EDAM Area in advance, if practicable, or immediately following the reduction or suspension.  This communication and subsequent coordination should continue among the CAISO and all potentially impacted EDAM Entities to assess and mitigate potential issues within the EDAM Area until resolution of the circumstances underlying the reduction or suspension in the Real-Time Market as may be reflected by results provided under Section 29.34(o). Further, the CAISO and the EDAM Entity will only undertake any reduction or suspension of EDAM Transfers between one or more Balancing Authority Areas in the EDAM Area in a manner that is not unduly discriminatory or preferential, taking into account any transmission scheduling priorities in the EDAM Transmission Service Providers’ tariff or CAISO Tariff, as applicable, and potential or actual involuntary curtailment of Demand within a Balancing Authority Area.  The CAISO will promptly adjust the EDAM Transfer limits or EIM Transfer limits associated with the reduction or suspension to reflect in the CAISO Markets the reduction or suspension directed by the EDAM Entity with respect to its Balancing Authority Area or the CAISO with respect to its Balancing Authority Area.

• Section 33.18.2 states that EDAM Transfers must be supported by firm or conditional firm point-to-point transmission service rights in hourly increments across an EDAM Internal Intertie. NV Energy provides a clarification that if the transmission provider does not sell hourly firm transmission, daily firm can be used with hourly increments identified.

• 33.26.2.3        Component 3: Recovery of Transmission Costs Associated With EDAM Wheeling Through Volumes Net of Imports/Exports (proposed redlined changes consistent with Final Proposal). The third EDAM recoverable component eligible for recovery is projected revenue shortfalls associated with wheeling through an EDAM Entity Balancing Authority Area or the CAISO Balancing Authority Area associated with an EDAM Transmission Service Provider in excess of the total net transfers of the EDAM Entity Balancing Authority Area.  In periods where this excess occurs, the EDAM Entity, on behalf of the EDAM Transmission Service Provider, will be compensated for the transmission use supporting excess wheeling through the EDAM Transmission Service Provider or CAISO Participating TO at the EDAM Entity’s filed and approved non-firm hourly point to point transmission rate.

• 33.30.7           Convergence Bidding

In the last round of comments, NV Energy noted that the language in section 33.30.7.1 mandates the imposition of virtual bidding after two years and that this requirement was in direct contravention of the final proposal as approved by the EIM Governing Body and the Board:

this proposal removes a mandatory transition to convergence bidding after a one year transition period if an entity does not elect to implement convergence bidding at the onset of their participation. Under the final proposal, in the lead-up to the two-year anniversary of EDAM operation – as a year-two enhancement – the ISO will conduct a stakeholder process to derive a more permanent EDAM convergence bidding policy informed by operational experience and stakeholder input. The proposed optionality enables interested EDAM entities to implement convergence bidding functionality in their balancing area at the onset of their participation in EDAM. It also allows entities that are not yet ready for enabling convergence bidding in their balancing area at the start of their EDAM participation to gain experience with the market and implement convergence bidding at a later time. The first two years of EDAM operation will allow the ISO and EDAM participants to develop valuable operational experience in the EDAM and evolve the design based on that experience. A future stakeholder process will evaluate a holistic implementation of convergence bidding, including a formal transition to convergence bidding for participating EDAM entities, the necessity for any interim bidding requirements, and design enhancements based on EDAM operational experience. The ISO will, in coordination with the Department of Market Monitoring (DMM), continue to monitor and evaluate the market’s performance with or without convergence bidding in various parts of the footprint to help inform the evolution of the future design and address any unintended consequences of an optional convergence bidding design at the onset of EDAM.

NV Energy submits it is unjust and unreasonable to include a requirement in a tariff subject to a stakeholder process to assess whether that requirement would be just and reasonable or if any conditions are required to make it just and reasonable. Any notion that this is needed simply a “placeholder” does not withstand scrutiny. As with any other subsequent modification to the tariff it could be added in when approved. The requirement should be eliminated from the initial EDAM tariff and can be added based on the outcome of the stakeholder process.

• 33.30.7.1        Optional Transition Period (proposed redlined changes to remove the two-year mandate)

For its first two years in the Day-Ahead Market, each EDAM Entity may participate in the Day-Ahead Market without Virtual Bids in its Balancing Authority Area.  Alternatively, Each EDAM Entity may voluntarily elect to forego such a transition period and commence Day-Ahead Market participation with Virtual Bids in its Balancing Authority Area.

• 33.31.3 – The CAISO should provide additional explanation as to how and when it would enforce the constraint with respect to CAISO exports.

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Section 33.31.1.6 (“Timely Submission of Tags …”). 

This section needs additional language to reflect the final policy that tagging deficiencies can be cured by STUC. Further, tariff language should be added to clarify what can cure the deficiency.  It is PG&E’s understanding that as long as the energy schedule is replaced with a feasible schedule (i.e., provided by an RSE-eligible resource and flows the same path or another feasible path) that the cure should count towards the requirement. 

33.31.1.6           Timely Submission of Tags Necessary to Remain in EDAM Pool

A Balancing Authority Area in the EDAM Area must comply with the tagging protocols set forth in Section 33.30.8.3 and the Business Practice Manuals to ensure imports and exports are timely tagged.  A Balancing Authority Area in the EDAM Area that fails to timely E-tag imports or exports, and does not otherwise re-supply from a physical source to cover for the untagged imports or exports for the operating hour following the process in the Business Practice Manual and as outlined in section 33.31.1.7, will be removed from the EDAM Upward Pool or the EDAM Downward Pool, respectively, for that Trading Hour.  A Balancing Authority Area in the EDAM Area that is removed from the EDAM Upward Pool or the EDAM Downward Pool in accordance with this Section 33.31.1.6 will be evaluated as an individual Balancing Authority Area and will be allowed to share in the Diversity Benefits of the pool that it would have otherwise been a part of, as provided in Section 33.31.1.4.3. 

33.31.1.7           Curing Tagging Deficiencies to Remain in EDAM Pool

Balancing Authority Area in the EDAM Area that fails to timely E-tag imports or exports must cure that deficiency before the Short-Term Unit Commitment process runs. The curing energy must be for a physical RSE-eligible resource flowing on a feasible path.

Appendix A – Master - Gross Load

Does the definition of Gross Load cover loads that are directly connected to an EDAM participants transmission voltage (i.e., industrial load connected to 115kV)?  If not, please consider the redlines below. It clearly covers such a load for CAISO PTOs but not EDAM transmission service providers.

“Demand (adjusted for distribution losses) of End-Use Customer Loads directly connected to the transmission facilities or directly connected to the Distribution System of a Utility Distribution Company or MSS Operator located in a PTO Service Territory, or End-Use Customer Loads directly connected to the Transmission or Distribution System of an EDAM Transmission Service Provider in an EDAM Entity Balancing Authority Area.”

33.26 EDAM Access Charge

33.26.2.1 – The last sentence of this paragraph seems to apply to all EDAM entities but includes a revenue that might only accrue to the CAISO BAA.   Does this apply to all EDAM entities or is this meant to be specific to the CAISO BAA?  Or is there a need for this to be more general?

“EDAM Entities associated with EDAM Transmission Service Providers also may recover, on behalf of such EDAM Transmission Service Providers, projected revenue shortfalls due to foregone CAISO Participating Transmission Owner WAC revenues associated with third-party Wheeling from the CAISO Balancing Authority Area.”

33.26 – Monitoring and Consequences

Section 33.26.4 makes clear the level of documentation that will be needed as well as some level of transparency (metrics that will be posted).  There might be value in being explicit the monitoring of this mechanism (who is monitoring, for what types of behavior, etc.) and the consequences of misuse of this mechanism.

Section 33.26 may need to be revised further given the ongoing initiative to further clarify the way the CISO BAA will participate in the EDAM.  This topic is scoped in Track 1A (See Slide 7 of the CAISO’s June 14^th presentation, accessible here: http://www.caiso.com/InitiativeDocuments/Presentation-ExtendedDay-AheadMarketISOBAAParticipationRules-Jun14-2023.pdf)

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Please see attached. Thank you. 

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PGE appreciates the extensive amount of time and work from stakeholders and the CAISO on the Extended Day-Ahead Market (EDAM) initiative. PGE has been engaged in this initiative since its development. The CAISO has shown collaboration amongst many different entities which has helped shape the market design and tariff. A day-ahead market is an important step forward to leveraging regional markets to support enhanced reliability, lower prices, and decarbonize the energy supply. EDAM provides a viable option for Western entities in making the next incremental step.

PGE is generally supportive of the changes made to the revised draft tariff and appreciates CAISO’s work to address many of PGE’s initial concerns on the draft tariff, there is still work that needs to be accomplished, particularly around transmission use to support transactions under the Western Resource Adequacy Program (WRAP). PGE has committed to participate in the WRAP’s binding program in 2026 and sees the WRAP as a critical tool for maintaining regional reliability.

As the west continues to incrementally and independently evolve market structures while operating under the Open Access Transmission Tariff (OATT) framework, the complexity of aligning three tariffs (i.e., the CAISO tariff, the WRAP tariff, and the utility’s OATT) is increasing exponentially. With this complexity, it is important to ensure clarity regarding the obligations that will need to be carried through the various tariffs to ensure consistency.

Specifically, in Section 33.18.3.3 (Transmission Not Available in the Day-Ahead Market) the intent of “carve out” should be more defined. PGE agrees that the prospective EDAM Entity tariff and the CAISO tariff must work in consort to ensure that an EDAM Entity that is also a WRAP participant can honor both obligations; however, the CAISO tariff can include more specificity in this section to promote consistency in the treatment of the delivery of the WRAP holdback obligation.

Finally, in Sections 33.18.3 (Contract Reference Numbers), CAISO states it “will honor the scheduling priorities of EDAM Transmission Service Provider customer transmission rights as provided under the EDAM Transmission Service Provider tariff subject to the provisions of Section 33.18.1 and 33.18.2.” PGE interprets this statement as OATT scheduling priorities would be honored but would like clarification as to CAISO’s intent as PGE interprets as a shift from an OATT framework. More dialogue in these areas would be appreciated at the next stakeholder workshop.

PGE looks forward to continually working with the CAISO and stakeholders to improve the tariff for a filing at FERC.

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Powerex submits the following comments on the CAISO’s June 8, 2023 Revised Draft Tariff language for the Extended Day-Ahead Market (“EDAM”).  The Revised Draft Tariff language continues to pursue an unacceptable approach for EDAM to use Firm transmission rights held by transmission customers of participating Transmission Service Providers (“TSPs”).  A long-standing and bedrock principle of the OATT framework is that Firm transmission rights that have not been scheduled by the rights-holder may be made available for use by others, but strictly as lower-priority, non-Firm service.  When this occurs, the transmission customer that holds Firm rights continues to have the ability to use those rights, up to and through the delivery hour, in which case schedules on lower-priority rights may be limited and/or curtailed.

The Revised Draft Tariff language violates this fundamental element of the OATT framework.  Specifically, Firm OATT rights unscheduled prior to the day-ahead market will be available to support EDAM Transfers, but those EDAM Transfers will not have lower priority than deliveries using the original Firm OATT rights.  Instead, EDAM Transfers on unscheduled Firm rights will have equal priority to flow as deliveries that are scheduled outside of EDAM by the transmission customer that invested in Firm OATT service.  In effect, the Revised Draft Tariff language proposes to use unscheduled Firm OATT rights as Firm service, rather than as non-Firm service.

When a path is over-scheduled, and redispatch through EDAM and/or EIM is not able to allow all schedules to flow, reductions or curtailments of those schedules will be required.  Regardless of which particular schedules are curtailed—and which schedules are able to flow—the same quantity of power will flow across the transmission constraint, with the same total generation upstream of the constraint and the same total load being served downstream of it.  The selection of which particular schedules are curtailed is therefore not supported by arguments of regional reliability, efficient dispatch, or environmental goals. 

What the Revised Draft Tariff does attempt to do is change who bears the consequences when transmission limitations restrict the amount of power that can be delivered to different customers downstream of that constraint.  Simply stated, the Revised Draft Tariff Language attempts to ensure that as much of that power as possible is delivered to the load located in the EDAM footprint (including the CAISO BAA), including by shifting the risk of load curtailments onto customers that have invested in Firm OATT service who are seeking to use it to serve load outside of the EDAM area.

The CAISO’s approach for EDAM is in contrast with the Western EIM, which also utilizes Firm capacity that has not been scheduled by the Firm transmission customer prior to the market run but recognizes that any EIM Transfers relying on this capacity have lower priority.  If the transmission customer holding the Firm rights subsequently schedules on those rights, it is recognized that the EIM Transfers may need to be reduced.

The Revised Draft Tariff language is also in contrast with the CAISO’s Initial Proposal for EDAM, in which unscheduled Firm OATT capacity was not made available for EDAM Transfers at all.  The Initial Proposal would support EDAM Transfers only with Firm OATT transmission that was affirmatively and voluntarily made available for optimization in EDAM by the rightsholder[1].

Powerex believes the Revised Draft Tariff must be modified to avoid violating OATT principles and upholding the scheduling priority of Firm OATT service.  Potential solutions include:

• Continue to make unscheduled Firm OATT rights available to support EDAM Transfers but recognize that the quantity of EDAM Transfers on unscheduled Firm rights has lower priority and may need to be reduced in real-time.  This may require physical resources to be committed or positioned day-ahead to ensure a feasible solution is available if the EDAM Transfers relying on non-Firm transmission are, in fact, reduced.  Powerex believes this is the preferred approach, as it continues to enable maximum efficient utilization of transmission capability in EDAM, while upholding OATT priority.
• Revert to the CAISO’s Initial Proposal for EDAM, in which only unsold Firm ATC or Firm rights affirmatively and voluntarily made available by the rightsholder are available to support EDAM Transfers.
• Make no change to the proposal for how transmission is made available to EDAM or to the scheduling priority of EDAM Transfers but afford transmission customers that hold Firm OATT rights the unqualified option to have those rights “carved out” from use in EDAM.  Powerex does not believe this approach is desirable, but it is the minimum required to protect Firm OATT rights if the CAISO continues to pursue its current direction.

Each of these potential solutions will ensure that EDAM does not deprive entities that invest in Firm OATT rights the priority to deliver power in real time.  The ability to rely on this priority:

1. Underpins the equitable funding of existing transmission service in the west, by encouraging third party users of the transmission system to invest in long-term Firm OATT rights;
2. Is vital to achieving the extensive transmission upgrades and expansion necessary in the region, as the priority of flow afforded to Firm OATT rights is a key value item that drives long-term investment in existing and new transmission service under the OATT framework; and
3. Is the basis for arrangements and programs (including WRAP) that protect reliability by ensuring the deliverability of resources to load with a high degree of confidence.

[1] CAISO’s initial proposal for EDAM was also, appropriately, able to use Firm OATT transmission capacity that was not yet sold to anyone.

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The Public Generating Pool (PGP) appreciates the CAISO and stakeholders continued efforts to develop durable and fair language for the Extended Day Ahead Market (EDAM) Tariff that is reflective of the policy described in the EDAM Final Proposal. As noted in our comments on the final proposal, PGP supports the Balancing Authority Area (BAA) voluntary participation framework, as it aligns Open Access Transmission Tariff (OATT) frameworks and locally funded transmission systems with a broader market optimization to capture regional benefits. These benefits have the potential to include not only economic efficiency gains, but reliability benefits as well, through enhanced regional coordination, market visibility, and enhanced utilization of the transmission system through use of a shared market optimization engine. Given this participation framework, and an anticipated transition period due to phased market-entry, the tariff requires careful consideration of appropriate roles and responsibilities between the Market Operator (MO), the Transmission Service Providers (TSPs), and the Balancing Authorities (BAs). This also requires evaluation of the tradeoffs associated with market use of transmission for the benefit of market participants, which will include OATT rights that are contributed for market optimization. As more entities join a market, market-to-market coordination may supplant bilateral transactions, and the market solutions will be relied on more heavily to support regional reliability as market participation reaches critical mass. As the region moves toward this desired end-state, PGP supports a focus on interoperability with bilateral frameworks as a transitional measure.

Early in the EDAM design effort, regional stakeholders had extensive discussion that established a goal of a market that enhances and contributes to regional reliability, which requires a high level of confidence in market transfers and an ongoing reliance on the existing roles of the Balancing Authorities.  A unique consideration for this market design is also the appropriate preservation of optionality and priority of OATT rights as participants contemplate operating in a footprint that is managing phased entry and market seams. Consideration of this future is particularly important as it relates to resource adequacy, including fulfillment of obligations related to participation in shared Resource Adequacy (RA) programs such as the Western Power Pool’s Western Resource Adequacy Program (the WRAP) and the California Public Utility Commission’s Resource Adequacy Program. While these programs are arguably outside of the scope of the EDAM design, they have significant implications for how various parties might be incentivized to participate in and/or use, the market.[1] If EDAM in some way undermines regional RA programs, it will not be a durable market design, and should instead work to provide a platform that may meet the operational needs of such programs in a more efficient manner than can be obtained through the bilateral construct. During the transition to the desired end state where the market solution is relied upon in the operational timeframe, and RA programs are geared more towards shared planning and adequate procurement of long-term supply, this will require tariff language that seeks to fully optimize the use of OATT transmission that has opted-into the EDAM to capture regional benefits and enhance reliability while minimizing any reduced optionality for late entrants.  PGP offers the following suggestions to enhance the interoperability with the RA programs during the transitional period and to align the tariff with the ongoing roles and responsibilities that are unique to this market construct.

33.7.3 Manual Dispatch:

“The EDAM Entity may issue a manual dispatch to an EDAM Resource in its Balancing Authority Area, outside of the Market Clearing of the Day-Ahead Market, and enforce Transmission Constraints when necessary to address issues in the EDAM Entity Balancing Authority Area that the CAISO is unable to address through normal economic Dispatch and Congestion Management.  The EDAM Entity Scheduling Coordinator will inform the CAISO of the manual dispatch through submission of a Self-Schedule or EIM Manual Dispatch, and if the EDAM Entity Balancing Authority Area is under manual operation.  Upon receiving notice of a manual dispatch, the CAISO will reflect the manual dispatch in the applicable CAISO Market depending upon when the notice is received and only to the extent that reflection of the manual dispatch in the market is practicable.”

PGP recommends specific timelines be included either in the Business Practice Manual or tariff for when manual dispatch needs to be provided to be considered feasible for the various market runs. Noting that for the WRAP operations program the requirement is T-90 for holdback release, this seems a logical timeline to accommodate manual dispatch in the RT market during the transition phase, and addressing this more explicitly in the tariff language may support WRAP interoperability.  See WRAP Operations overview graphic provided by WPP in a recent Ops-Program overview presentation.

33.7.5 EDAM Transfer Priority Relative to Demand 

“EDAM Transfers will have a priority equal to Demand in the EDAM Area.  If it is necessary for an EDAM Entity or the CAISO to reduce or suspend EDAM Transfers between one or more Balancing Authority Areas in the EDAM Area based on operational judgement and consistent with Good Utility Practice, the CAISO or the EDAM Entity may do so, provided that the reduction or suspension is consistent with the EDAM Transmission Service Provider tariff or the CAISO Tariff, as applicable, and communicated to potentially impacted Balancing Authority Areas in the EDAM Area in advance, if practicable, or immediately following the reduction or suspension.  This communication and subsequent coordination should continue among the CAISO and all potentially impacted EDAM Entities to assess and mitigate potential issues within the EDAM Area until resolution of the circumstances underlying the reduction or suspension in the Real-Time Market as may be reflected by results provided under Section 29.34(o).  Further, the CAISO and the EDAM Entity will only undertake any reduction or suspension of EDAM Transfers between one or more Balancing Authority Areas in the EDAM Area in a manner that is not unduly discriminatory or preferential, taking into account any transmission scheduling priorities in the EDAM Transmission Service Providers’ tariff or CAISO Tariff, as applicable, and potential or actual involuntary curtailment of Demand within a Balancing Authority Area.  The CAISO will promptly adjust the EDAM Transfer limits or EIM Transfer limits associated with the reduction or suspension to reflect in the CAISO Markets the reduction or suspension directed by the EDAM Entity with respect to its Balancing Authority Area or the CAISO with respect to its Balancing Authority Area.”

This section is critical to preserving appropriate roles and responsibilities in the multiple BA framework that is contemplated in the EDAM design. We find it worth noting that this language appears to reflect these roles and responsibilities appropriately but indicates that some portion of the design and interoperability will ultimately be fulfilled through OATT revisions that may occur to enable EDAM participation.

33.9.3 Transmission Limits

“An EDAM Entity Scheduling Coordinator must notify the CAISO by the means and in the manner specified in the Business Practice Manual for the Extended Day-Ahead Market regarding transmission limits on the transmission capacity made available to the Day-Ahead Market within the EDAM Entity Balancing Authority Area that need to be enforced in the Day-Ahead Market.”

PGP recommends that for the business practice development, the CAISO explore a more granular reservation notification to reflect operational realities of a phased entry approach or seams with non-market participants. This may indicate an hourly shape may need to be applied to the max capabilities to the extent this is feasible from a modeling and automation perspective. PGP recommends the CAISO explore this approach in the ongoing implementation process and continue the dialogue on interoperability and seams, noting that improved granularity in this process may also align better with the ongoing relationship between the WEIM and the EDAM.

33.18.3.3 Transmission Not Available in the Day-Ahead Market

“If the CAISO is informed through the prospective EDAM Entity implementation process or by the EDAM Entity Scheduling Coordinator for the EDAM Transmission Service Provider that, based on actual market operational experience, modeling, or analysis during the implementation phase, accommodating Self-Schedules accounting for incremental intra-day schedules in the Real-Time Market that were not scheduled in the Day-Ahead Market may impact market outcomes or reliability, the CAISO will accept a notification from the EDAM Entity Scheduling Coordinator associated with the EDAM Transmission Service Provider and will adjust Day-Ahead Market availability of the impacted transmission elements and the associated transmission service rights in accordance with the EDAM Transmission Service Provider tariff.”

Given this concern may only arise during rare contingency events, it may be difficult for EDAM entities to demonstrate this need using operational experience. As such, we recommend modifying the language to include “or modeling and analysis in the implementation phase” next to “operational experience” in this clause. Such modeling or historical analysis should consider the unique ATC methodology of the EDAM entity, including but not limited to Capacity Benefit Margins and Transmission Reliability Margins, or other risk margins designed to address operational uncertainty. Analysis may indicate that these margins can be relied upon in edge cases as intended, to avoid adverse outcomes.

PGP appreciates the ongoing efforts of CAISO to address interoperability concerns that arise as a result of enabling phased entry, and recommend the region continue the dialogue on interoperability to enable market transitions toward enhanced reliability and ongoing improvements in regional coordination.

[1] PGP notes that most potential non-CAISO EDAM Entities are currently non-binding participants in the newly formed Western Resource Adequacy Program (WRAP), but will be transitioning to the binding phase of the program as EDAM begins to go live. While this program is non-binding would be an ideal time for continued analysis on the benefits of a broader footprint, and if maintaining an adequate reliability standard to incentivize participation from a broader footprint is sufficient incentive, economically and otherwise, to drive appropriate RA procurement to this regional standard.

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Western Resource Advocates and Sustainable FERC Project (Public Interest Organizations “PIOs”) appreciate the opportunity to comment on the Extended Day-Ahead Market (EDAM) Revised Draft Tariff Language. The PIOs support the development of a successful, well-designed EDAM that maximizes efficiency, reduces greenhouse gas emissions, and lowers costs. In accordance to these goals, our comments focus on certain transmission elements that can maximize both participation in, and the efficiency of, the market.

Section 33.1.1.1 - PIOs request clarification of the definition of “manual operation” that an EDAM Entity would undertake of its BAA in the event the CAISO issues a Market Notice of temporary suspension of EDAM participation by an EDAM Entity.

Section 33.2.1 - PIOs request that CAISO require EDAM Entity Implementation Agreements to be made available in the tariff or provide further clarification on the reason for not requiring it. EDAM Entity Implementation Agreements are important as they provide relevant and crucial information on seams. While there isn’t a requirement in the tariff for the CAISO to publish the EIM Implementation Agreements, the EDAM is not just an extension of the EIM, it is a full day-ahead market, and its tariff requirements should not be based on the EIM.

Section 33.4 (d) - PIOs request clarification on the definition of “CAISO Controlled Grid” to ensure alignment with the definition of “CAISO Controlled Grid” under different conditions within the Joint Authority framework.

Section 33.18.2.2 - CAISO has included a path forward that enables transmission customers of transmission service providers that have transmission rights across an EDAM BAA to have their transmission used to support Resource Sufficiency. PIOs appreciate how CAISO has proactively worked with key stakeholders to find modifications to this specific tariff language that addresses this issue. Allowing the use of these transmission rights for Resource Sufficiency under Bucket 2 will improve the efficiency of the market while reducing barriers to participation for entities that have contracted with off-system generators in another EDAM BAA. While we are greatly appreciative of the significant progress that has been made on this issue, we suggest CAISO consider implementing economic bidding (rather than self-scheduling) for the use of this transmission to maximize efficiencies in the market.

Section 33.23 - Per our previous comments, the PIOs support further discussions on Section 33.23 of the Revised Tariff Language. We believe the use of an hourly transmission charge would bring significant efficiency benefits to participants in the market. We also support exploration of alternative language, including the optionality for the use of a non-firm hourly transmission charge, that would be workable for both CAISO and transmission providers to achieve this outcome.

Section 33.29 - PIOs request further explanation of the operational linkages between the EDAM and the EIM in the EDAM Business Practice Manual.

Section 33.31.4 - PIOs request that the Demand Forecast and Variable Energy Resource Forecast for each EDAM Entity is given to the Department for Market Monitoring (DMM) and that the information is reflected in regular DMM reports and presentations for regulators and stakeholders.

Section 33.32.6.2 - PIOs request clarification on what would be considered “confidential” about information related to GHG Transfers that would prevent the information from being disclosed. We support the disclosure of information related to GHG Transfers as an important component to the West-Wide GHG Reporting Initiative led by the Clean Energy Buyers Institute (CEBI), WRA, GridLab, and Gridworks and supported by the Sustainable FERC Project.

In addition to these recommendations and requests, the PIOs reiterate our suggestion for CAISO to include as much detail as possible in the Tariff. Including the Final EDAM Proposal’s key policy provisions in the Tariff language minimizes concerns over how EDAM entities might implement these policies and ensures consistency in treatment across BAAs. Additionally, PIOs continue to broadly support EDAM, with the hope that the transmission provision proposal will lead market participants on a glide-path to an RTO in the West. We believe a flow-based transmission framework that enables transparent use and allocation, maximizes efficiency, and ensures fairness in compensation will result in significant benefits for participants across the footprint while integrating the maximum amount of clean energy generation.

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Shell Energy North America (US), L.P. (“Shell Energy”) appreciates the opportunity to provide limited comments on the draft EDAM tariff language.  As a threshold matter, Shell Energy insists the EDAM tariff should generally seek a reasonable balance between harmonization of concepts across prospective EDAM TSPs and avoiding being overly prescriptive in application of concepts.  The current frame is too loose; Shell Energy is concerned this will reduce the efficiency of the EDAM by resulting in duplicative processes across the EDAM footprint.

The CAISO’s current approach relies heavily on each TSP making discrete changes to their respective OATTs to implement core concepts of EDAM.  To ensure consistency across the EDAM footprint, the CAISO should develop pro-forma tariff language to be used as a template – a “starting point” by prospective EDAM TSPs--meanwhile not require any specific tariff language be adopted.  This approach would strike the right balance to encourage harmonization as prospective TSPs would almost certainly build from the template tariff language rather than formulating tariff language from scratch.  Needed context and specificity is often lost in translation—a common template to work from would reduce these pitfalls.  

With respect to WEIM, Shell Energy’s experience is settlements, processes, procedures, and business practices are not well aligned across the WEIM footprint currently.  Indeed, this level of duplicity requires 10 different approaches, spreadsheets, and processes to validate the same general data for each WEIM TSP’s settlement and validation processes.  EDAM should seek to avoid this pitfall where possible. 

Along these lines, one specific concern for Shell Energy is the potential for non-uniform allocation of redispatch costs across the EDAM footprint when customer transmission rights are exercised in various regions through to realtime.  Without a template to work from, the CAISO is opening the door to the WEIM approach – multiple methods and disparate treatment of the same concept across TSPs.  This would result in a demonstrable seam with efficiency costs and should be avoided.  

Specific comments regarding Section 33.18.3.2:  The CAISO, as the market operator of EDAM must define the process for assigning contract reference numbers (‘CRNs’) to all long and short-term transmission products—from long term to hourly transmission.  The Pacific Northwest region relies heavily on redirected transmission – this reality must be reflected by the CAISO adopting a CRN process that is more granular than only CAISO’s 5-day Masterfile process; this will not accommodate short-term transmission service.

Finally, Shell Energy objects to language of Section 33.30.3 which is bold italicized below.  Except for resource-specific resources with an obligation to serve Demand in the EDAM Area described in Section 33.30.8, or a Scheduling Coordinator for a designated resource associated with network integration transmission service of an EDAM Transmission Service Provider, or a resource located outside of the EDAM Area at an EDAM External Intertie with the CAISO Balancing Authority Area, Scheduling Coordinators may not submit Economic Bids at EDAM External Interties or EDAM Internal Interties.  Scheduling Coordinators may submit Self-Schedules at any EDAM Intertie.” 

First, the distinction of EDAM internal and external intertie is quite confusing; we suggest the use of “intra-EDAM tie” to denote a transmission connection between two EDAM areas.  We understand EDAM external intertie refers to a transmission connection between an EDAM and non-EDAM area. 

For intra-EDAM tie locations, Shell Energy understands resources must economically bid or self-schedule at the generator node rather than the point of electrical connection between the two EDAM-areas.  Please confirm.

For non-EDAM interties (aka EDAM external interties), Shell Energy opposes the prohibition of economic bidding unless the resource either: 1) demonstrate a contract to serve load in an EDAM area, 2) be considered a designated network resource for an EDAM BAA, or 3) are pseudo-tied or dynamically scheduled.  As a general matter most of the supply offered to the CAISO IFM market is economically bids – the concept is true for bilateral markets as well.  Removing economic bidding is not preferred in well-functioning markets and should be minimized.

In addition, Shell Energy notes there are contracts to serve load which utilize point-to-point transmission service, whereas designated/secondary network resources are a relic of network transmission service alone.  Resources under contract by a scheduling coordinator located in non-EDAM areas must retain the ability to economically bid at the non-EDAM intertie location such that the scheduling coordinator (or affiliate) has a load contract in an EDAM area—whether or not the load utilizes network or point-to-point transmission service. 

 Further, requiring these resources located in non-EDAM areas to self-schedule (vs economically bid) introduces novel price risks—which affect existing and prospective contracts alike for resources located in non-EDAM BAAs. Offtake contracts are often fixed price which introduces an unforeseen and potentially unmanageable variable between the PPA price and the payment (or charge) to the generator for self-scheduled energy.  Shell Energy requests that market-participants, scheduling coordinators/generation owners located in non-EDAM areas with access to transmission to an EDAM area which are able to demonstrate an offtake contract be enabled to economically bid resources at the connection point between the EDAM and non-EDAM area. 

Consider the following example: BreezyWind resource is in a non-EDAM BAA.  BreezyWind is under contract to the scheduling coordinator AC.DC, which also has a separate contract to serve load inside an EDAM-BAA.  AC.DC has point-to-point transmission rights in both BAAs for service of these discrete contracts. AC.DC can support the intent to serve load with the resource by demonstrating transmission and a contract for both generation and load.  In this case, the tariff should allow for BreezyWind to be economically bid into EDAM at the electric adjacency between the non-EDAM and EDAM BAA.  Section 33.30.3 must be amended to reflect this.  

Thanks for consideration of these comments.

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Appendix A – Master Definitions Supplement:

1. EDAM Demand as “Energy delivered to Load in an EDAM Entity Balancing Authority Area.”

The Six Cities question whether there is a need for a definition of EDAM Area Demand that would include Demand in the CAISO BAA and all EDAM Entity BAAs?

2. EDAM Area

The CAISO’s comment references a proposed term “EDAM Balancing Authority Area.”  The Six Cities note that the CAISO does not appear to define this term, but it is used in several places in Section 33.

3. EDAM Transmission Service Provider as:

An EDAM Entity or other party that owns transmission or has transmission service rights on an EDAM Intertie or within an EDAM Entity Balancing Authority Area that makes transmission service available for use in the Day-Ahead Market through an EDAM Entity.  This definition does not include network integration transmission service customers or other transmission customers of an EDAM Transmission Service Provider.

The Six Cities recommend deleting the reference to “or other transmission customers” in the last sentence of the definition.  The exclusion of NITS customers is clear, but the reference to “other transmission customers” seems overly broad and would sweep in holders of transmission rights, which would make the definition internally inconsistent.

EDAM Transmission Service Provider Agreement:

1. Whereas Paragraph B:  The Six Cities recommend deleting the reference to “or other transmission customers” in the last sentence of the paragraph.  The exclusion of NITS customers is clear, but the reference to “other transmission customers” seems overly broad and would sweep in holders of transmission rights, which would make the paragraph internally inconsistent.

2. Section 3.2.1:  The Six Cities question whether the CAISO should have the ability to terminate the agreement if the EDAM Entity within which the EDAM Transmission Provider operates or holds transmission rights terminates its (the EDAM Entity’s) participation in the EDAM.

In addition, the reference in the first sentence to Article IX should be changed to Article VII.

3. Section 6.1:  In the second line, change “has” to “have”.

4. Section 6.2:  In the last line, insert after the word “with,” “the EDAM Entity within which the EDAM Transmission Prover operates or holds transmission rights or”.

EDAM Load Serving Entity Scheduling Coordinator Agreement:  The Six Cities question whether there also should be a draft pro forma EDAM Load Serving Entity Scheduling Coordinator Agreement.

Appendix F:  The Six Cities reiterate their previous comment that Appendix F should be revised to address, most likely at Schedule 3, the methodology that will be used to determine the EDAM Access Charge for the CAISO.  Alternatively, more detail should be set forth elsewhere in the CAISO Tariff to specify how and when the EDAM Access Charge for the CAISO will be determined and the process that the CAISO will use to update its EDAM Access Charge and validate its accuracy with CAISO Participating TOs.

Section 11:

1. Section 11.5.8: The Six Cities reiterate their previous request that the CAISO clarify the relationship of Settlement for Emergency Assistance as described in Section 11.5.8 and the provisions of the optional EIM Assistance Energy Transfer process proposed under the Resource Sufficiency Evaluation Enhancements Phase 2 initiative.

2. Section 11.5.10:  In the next to last line of the section, change “served” to “serve”.

3. Section 11.8.6.5:  The Six Cities reiterate their previous request that the CAISO confirm that EDAM Entity BAAs will share in the allocation of RUC Compensation Costs and ensure that the definitions and processes described in this section will appropriately provide for such sharing.

4. Section 11.14(b):  Referring to the second sentence of this sub-section and the CAISO’s response to the Cities’ previous comment on this section, it does seem necessary to include a reference to EDAM Demand, if the dispute concerns the Day-Ahead Market.  The sentence differentiates between disputes that concerned the Real-Time Market (for which allocation is to EIM Measured Demand) and disputes that concerned the Day-Ahead Market (currently allocated only to CAISO BAA Demand).  EDAM Demand should share in any allocation made if a dispute concerned the Day-Ahead Market.

Section 27:

1. Overall relationship with Section 33.27:  Reading through multiple sections of Section 27, it is frequently unclear whether or not a section or process applies to the EDAM or EDAM Entities.  It would be helpful to include at or near the beginning of Section 27 a cross-reference to Section 33.27, stating that provisions of Section 27 that apply to the Day-Ahead Market apply to EDAM Market Participants except as provided in Section 33.27.  In addition, it does not appear that all exceptions or exclusions from Section 27 are covered in Section 33.27.  For example, it is Section 33.11.3.4 that makes clear the CAISO will not procure Ancillary Services for EDAM Entity BAAs.  There should be a cross-reference to that section in the introduction to Section 27 and in Section 27.1.2 as well as any other sections that create exclusions from Section 27.

For the portions of Section 27 that do apply to EDAM Market Participants, the language of the sections should be consistent in terminology with that applicability.  For example, Section 33.27 does not state that Section 27.1.1.2 does not apply to EDAM Entity BAAs, but the terminology of the section refers only to the CAISO BAA.  The Six Cities question whether it will be clear to EDAM Market Participants how Marginal Cost of Losses will be calculated in EDAM Entity BAAs.  Sections 27.5.1.1 and 27.5.6, which likewise are not addressed in Section 33.27, raise similar terminology issues.

2. Section 27.1.1.1:  In the last sentence change “the Balancing Authority Area” to “a Balancing Authority Area.”

Section 29:

1. Sections 29.1 and 29.29:  The language in Section 29.29 explaining the relationship between Section 29 and Section 33 would be even more helpful if included in Section 29.1.  The Six Cities recommend moving the text of Section 29.29 to Section 29.1 and leaving Section 29.29 as [Not Used].

2. Section 29.11(d)(3)(B)(ii):  The inclusion of the text of this sub-section appears to be inconsistent with the comment A8, which states that EDAM Entities and the CAISO BAA are excluded from being charged or allocated revenues from over-under scheduling in the real-time market.  Please clarify.

3. Section 29.32(a)(3):  In the second sentence of the sub-section (at line 6), insert “with” after “accordance”.

4. Section 29.32(b)(1):  In each of the second and third paragraphs, in the third line of each, insert “Area” after “Regulation”.

5. Section 29.32(b)(2):  In the third paragraph - -

• In the third line, insert “a” after “Demand in”.
• In the fourth line, delete the second instance of the phrase “a value equal to the lower of”.
• In the last line, insert “the” before “resource’s”.

Section 33:  Please refer to the attached redline containing the Cities’ comments on this section. 

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TransAlta appreciates this opportunity to provide comments as well as the efforts of the CAISO to help us better understand the proposed market design.

General Comments: 

TransAlta requests that the CAISO consider model tariff language for Transmission Service Providers to utilize in their open access transmission tariffs (“OATT”) as they implement EDAM, with the goal of achieving market-wide consistency that would greatly benefit participants. 

Specific Comments: 

33.18.2.2.3 – TransAlta appreciates how EDAM’s design honors transmission customers’ OATT-based transmission rights and the ability to exercise those rights after the Day Ahead market has closed.  We are disappointed, however, that the final design does not insulate those market participants from potential redispatch costs.  Absent those protections, transmission customers are at risk of paying for its transmission twice, once to the Transmission Service Provider (“TSP”) and again if allocated redispatch costs by the TSP.  As mentioned in the general comments above, TransAlta urges the CAISO to develop model tariff language for TSPs that eliminates this redispatch cost exposure. 

33.18.3.2 – TransAlta echoes NIPPC’s recommendation for the Contract Reference Numbers (“CRN”) process to also assign very short-term firm transmission rights, such as hourly service. 

33.18.3.3 – TransAlta appreciates the addition of this adjustment mechanism, which should help reduce over-reliance upon redispatch in situations where OATT-based transmission capacity is regularly scheduled in real-time.  However, it is unclear what tariff provisions TSPs will use to make this adjustment.  Does the CAISO intend to develop model tariff language for EDAM TSPs to incorporate into their tariffs? 

33.30.8 – TransAlta recommends that the CAISO reconsider practices and language dealing with economic bidding at interties. 

It is unclear how External Interties that exist today will be treated under the EDAM framework as proposed when EDAM Entities join.  For example, if the Bonneville Power Administration (“BPA”) were to become an EDAM Entity, would Malin become an EDAM Internal Intertie? 

If so, it appears that Section 33.30.8 would apply and prohibit economic bids at Malin.  Economic bids are a significant portion of energy delivered to the external interties today.  Market participants may not be willing to transact instead via self-schedules, be price-takers, and be left with no way to manage extreme price excursions. 

TransAlta requests that CAISO explain how EDAM’s implementation would affect External Interties that exist today and remove the prohibition on economic bidding described in 33.30.3.  TransAlta recognizes that this may be a current EIM practice, but we do not believe the two markets are comparable on this topic due to the significant volume of energy and financial commitment.  We request the CAISO commit to working with stakeholders to develop comprehensive intertie bidding into EDAM’s design. 

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Western Area Power Administration (WAPA) is a federal agency responsible for marketing hydropower to meet its statutory responsibilities to serve project-use energy pumping requirements and to market available hydropower generation under its power marketing plans to preference power customers.

In northern California, WAPA's Sierra Nevada Region (SNR) serves load in both the Balancing Authority of Northern California (BANC) Balancing Authority Area (BAA) and the CAISO BAA. WAPA SNR delivers its generation from many large and small hydro facilities in the Central Valley Project to its loads. WAPA SNR owns, operates, and maintains an extensive high voltage transmission network extending to the load centers of Northern California.

WAPA's Desert Southwest Region (DSW) serves load throughout Arizona and in portions of California and Nevada using generation from the Parker, Davis, and Hoover dams along with purchased power. WAPA DSW owns, operates, and maintains an extensive high voltage transmission network throughout Arizona extending into California and Nevada.

WAPA appreciates the opportunity to provide comments on the CAISO’s revised draft EDAM tariff language. During the EDAM stakeholder processes, WAPA has provided extensive comments both verbally and in writing. Many of WAPA’s concerns have been addressed to varying degrees. However, as a transmission provider, WAPA remains concerned that EDAM will utilize WAPA’s transmission system without providing adequate compensation, thereby leaving WAPA’s customers to subsidize the use of its transmission system by EDAM participants.

Transmission revenue requirement compensation

The draft EDAM tariff proposes to compensate transmission providers for the use of their transmission based on historical short and long-term firm transmission sales. This is not an approach that is equitable for WAPA because a significant percentage of WAPA’s sales are bundled energy and transmission services based on statutory and contractual obligations – not short and long-term firm transmission sales. As such, the current EDAM design does not include a mechanism for WAPA to be equitably compensated for use of its transmission system. WAPA believes that any transmission taken by the EDAM to create a “hurdle-free” market should also be eligible for full transmission revenue recovery.

Although the revised draft tariff language makes it possible for WAPA to receive transfer revenue and congestion revenue, it is uncertain whether the transfer revenue and congestion revenue would adequately meet WAPA’s revenue requirements in proportion to the transmission capacity taken by the market. Additionally, it is not clear whether WAPA would be eligible to recover sufficient transmission revenue from the market following the expiration of legacy contracts because some of the eligibility criteria in EDAM Section 33.26.2.2 would be difficult for WAPA to meet.

A goal of EDAM is to optimize generation and load resources in a broad geographic area to support renewable energy and reliability. Transmission resources will play a pivotal role in EDAM and should be fully compensated at rates approved via the processes specific to the individual transmission providers, with certainty for the capacity utilized by the market. Obtaining access to transmission without paying or paying for transmission usage at a discounted rate should not be an attraction of EDAM because doing so would unduly harm transmission providers like WAPA, which is a transmission-asset heavy utility with limited load.

Adequate transmission revenue recovery is vitally important to WAPA, as it is to all transmission owners. Although EDAM is not intended to incentivize long-term transmission investment, EDAM should not create detrimental side effects that deter long-term transmission investment.

Transmission loss compensation

WAPA DSW operates the Western Area Lower Colorado (WALC) BAA. WAPA SNR functions as a sub-balancing authority area within BANC except it does not submit NERC compliance paperwork separately from BANC. As such, WAPA balances the supply and demand instantaneously in real time including the transmission losses that are not accounted for in the schedules of bilateral trades. WAPA charges schedulers for transmission losses that are calculated hourly as the product of the transmission losses and the higher of the day-ahead locational marginal price (LMP) or its generation cost, where the transmission losses are calculated as a percentage of the scheduled quantities shown on the E-tags. WAPA charges the party responsible for the E-tag. In EDAM, transmission losses are implicitly reflected in the LMPs. When both WAPA and the CAISO charge losses independently, there is a potential conflict in transmission loss accounting for transmission facilities inside WAPA (or BANC for SNR). CAISO attempted to address this conflict in its EDAM tariff Section 27.1.1.2. Here is an excerpt from the latest version of the EDAM tariff.

             “27.1.1.2  Marginal Cost of Losses

For all PNodes and Aggregated PNodes in the CAISO Balancing Authority Area, including Scheduling Points, the use of the Base Market Model adjusted as described in Sections 27.5.1 and 27.5.6 in the DAM and the RTM processes incorporates Transmission Losses. At each PNode or Aggregated PNode, the Marginal Cost of Losses is the Marginal Energy Cost multiplied by the Marginal Loss factor at that PNode or Aggregated PNode. The Marginal Cost of Losses at a Location (PNode or APNode) may be positive or negative depending on whether an increase in Demand at that Location marginally increases or decreases the cost of Transmission Losses, using the distributed Reference Bus to balance it. The Marginal Loss factors are determined through a process that calculates the sensitivities of Transmission Losses with respect to changes in injection at each Location in the FNM. For CAISO Controlled Grid facilities outside the CAISO Balancing Authority Area, the CAISO shall assess the cost of Transmission Losses to Scheduling Coordinators using each such facility based on the quantity of losses agreed upon with the neighboring Balancing Authority multiplied by the LMP at the PNode of the Transmission Interface with the neighboring Balancing Authority Area. The MCLs calculated for Locations within the CAISO Balancing Authority Area shall not reflect the cost of Transmission Losses on those facilities.”

While the section addresses the transmission accounting issues in the CAISO BAA, it does not address the issues outside of the CAISO BAA. WAPA recommends expanding or updating this section to include all transmission facilities for which transmission losses are accounted for separately from the EDAM.

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Please see attached comments.