Keeping power plants on the grid when their owners would rather keep them off is now in the hands of the California Independent System Operator. The grid operator voted Nov. 2 to give itself the short-term option to keep a power plant online, despite its owners’ desire to close the unit down. Grid operator staff described it as a “teeny” part of backing up the grid, estimated to cost about $2.7 million a year. Still, the move to keep power plants online created a rift between the CAISO and the California Public Utilities Commission. The CPUC staff begged to differ that the amount was small, however. Called “capacity procurement mechanism,” the option is called a “fail safe” by grid operator staff. “Capacity procurement mechanism is a blunt instrument,” responded Robert Strauss, CPUC supervisor, procurement and resources. “It’s millions of dollars in ratepayer money.” Grid operator board member Bob Foster noted that both agencies are looking to underscore that the electric system has enough generation capacity to function in the worst of situations. Foster noted, however, that each agency has its own methods. “We’re not duplicating the CPUC, but taking another bite at the apple,” said Foster. In other news, the grid operator voted early this week to integrate demand-response electric demand drops into its wholesale market. A higher use of demand-response is expected to lessen requirements for peaking power plants at times of high electricity use. At this time, the grid operator may not call on demand-response drops of electricity consumption unless there’s an emergency, said Margaret Miller, CAISO senior market design and policy specialist. The decision takes out the “emergency” part of dispatch, as well as funneling it into the automatic wholesale bid market. While state policymakers integrate demand-response programs into utilities’ quotidian life, the California Independent System Operator noted that they constitute a tool that’s been manually dispatched by utilities. That is, utilities manage demand-response aggregation, but the ability to reduce electricity use through those plans must currently be relayed by phone during emergencies. The decision is set to allow automatic load reduction through utility and other bids to the grid operator’s daily wholesale market beginning in 2012.
