CAISO considers making Aliso Canyon gas reliability measures permanent

Dive Brief:

  • The California Independent System Operator has floated a proposal to extend gas reliability measures it put in place following reliability concerns related to the Aliso Canyon gas storage leak.
  • A straw proposal published by CAISO this month recognizes "continued risks to electric reliability due to constrained natural gas systems." Mitigation measures put in place after the leak was discovered in 2015 are slated to roll off at the end of November.
  • The Aliso Canyon storage facility, owned by Southern California Gas, is expected to have limited operability "for an extended period of time," CAISO officials say.

Dive Insight:

Renewable energy and quickly-installed battery storage have helped keep California's electric grid stable in the wake of diminished gas resources, along with an authorization for the Los Angeles municipal utility to burn diesel in its dual fuel plants when gas supplies run low. 

Now officials say they need to keep stricter reliability rules in place going forward until the capacity can be replaced.

CAISO is proposing to make a market constraint limiting the maximum gas burn of a group of generators "a permanent operational tool that can be used throughout the CAISO and Energy Imbalance Market balancing areas." According to the grid operator, experience over the past year has shown that the grid "has prudently used this tool and it has proven particularly effective when used."

The extended rules would also include CAISO's authority to label transmission constraints as uncompetitive when the natural gas constraint is enforced "and to suspend convergence bidding when the constraint adversely impacts market efficiencies."

According to the Energy Information Administration, California gas generation was off about 20% during summer 2016 as a result of the leak. 

CAISO's proposal would also make permanent the operator's ability to suspend virtual bidding in the event of market inefficiencies. Initial stakeholder comments are due next week and CAISO expects to issue a final draft of the proposal on June 21. Another round of comments would be due June 30.

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Filed Under: Generation Transmission & Distribution Regulation & Policy
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