CAISO Puts Generator Must-Offer Rules Proposal on Ice

The California Independent System Operator this week put off posting on its Web site a proposal to change ?must-offer? requirements for generators. The intent of these federal rules is to prevent generators from withholding supplies. The grid operator has been looking at ways to streamline, and make more transparent, the waiver process for must-offer requirements. But some have argued that must-offer problems extend beyond tweaking waivers. One problem, according to critics, is that cost shifting can occur?for instance, when Northern California customers pay for units required to run in Southern California. In the wake of the energy crisis, the Federal Energy Regulatory Commission requires generators to offer capacity from the plants if needed by the grid operator to prevent blackouts. The order is known as ?must offer.? A need to review the California Public Utilities Commission?s January 22 decision approving a procurement framework was cited as a reason for the delay. As part of this decision, all load-serving entities are mandated to acquire reserves to meet resource-adequacy requirements for the state. Another reason given was a FERC technical conference last week dealing in part with must-offer issues. The Independent Energy Producers and the Western Power Trading Forum have argued that resource-adequacy rules would take many must-offer concerns off the table.

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CAISO Puts Generator Must-Offer Rules Proposal on Ice

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