On October 30, 2023, FERC accepted the California Independent System Operator Corporation’s (“CAISO”) revisions to its wheeling tariff provisions. The revised provisions allow external load serving entities to obtain, in advance, on a monthly and daily basis, rights to transmit electricity (also known as “wheeling”) through self-schedule priorities equal to the scheduling priority of CAISO demand. The revised provisions also update CAISO’s calculation of Available Transfer Capability (“ATC”).
CAISO proposed a variety of revisions in its July 28, 2023, filing. First, CAISO proposed a framework for external load serving entities to request monthly or daily wheeling through priority. For the monthly request window, scheduling coordinators may submit a request no sooner than 12 months and no later than one month before the requested priority dates (which can be for any month or months within that 12-month horizon). For a daily request window, a scheduling coordinator may submit a request for priority no sooner than seven days before and no later than one day before the priority date (which can be for any day or days within that seven-day horizon). To be eligible for a wheeling through priority, a request must be supported by an executed firm power supply contract to serve an external load serving entity’s load. CAISO states that it will award wheeling through priority for requests based on the total number of hours of the requested priority over the applicable horizon. Requests “for more hours during the 13-month or seven-day period will be awarded before requests for fewer hours, and, in the event of a tie, CAISO will allocate the priorities pro rata to those entities that indicated a willingness to accept a pro rata or partial allocation.”
Second, CAISO proposed to update its ATC calculation to set aside intertie capacity for native load. The updates include revisions to the definition of “existing transmission commitments” (“ETComm”) to include transmission capacity for wheeling through priority because such transmission capacity will have priority equal to the priority of CAISO demand. CAISO also proposed to utilize historical import data in its calculation of ETComm across a 13-month horizon. It also proposed to update the transmission reliability margin (“TRM”) provisions to include two additional North American Electric Reliability Corporation (“NERC”)-approved components of uncertainty: (a) aggregate load forecast uncertainty and (b) variations in generation dispatch. The additions are intended to enable CAISO to establish and increase or decrease TRM values across all applicable horizons, including monthly and daily. CAISO also proposed modifications to the Capacity Procurement Mechanism (“CPM”) imports provisions. Under the modified CPM provisions, CAISO will first use available ATC, and then TRM, if ATC is no longer available, when it designates import capacity to address an annual or monthly resource adequacy deficiency. If CAISO designates import capacity for any other reason, it will first use the available TRM, and if no TRM is available, it will then use available ATC.
Third, CAISO proposed to modify the post-Hour-Ahead Scheduling Process (“HASP”) to adjust or curtail wheeling through priority transactions and imports needed to meet CAISO load pro rata if there is (1) a transmission limitation on the intertie and (2) a power balance infeasibility due to an inability to serve load.
FERC held that the requirements and processes proposed by CAISO will result in wheeling through service for external users that satisfies the comparability standard established in Order No. 888. FERC explained that it is not unduly discriminatory or preferential for CAISO “to require external load serving entities to meet certain eligibility criteria in order to obtain a scheduling priority equal to native load in CAISO, even if those criteria are not identical to the criteria applicable to resource adequacy imports, which serve that load.” Next, FERC approved CAISO’s proposed ATC calculation revisions, finding that it is not unduly discriminatory in principle for CAISO to reserve intertie capacity for native load before making ATC available to external load serving entities, citing Order No. 888 and Order No. 890’s emphasis to balance a transmission provider’s and outside entities’ need to meet load obligations. Finally, FERC found that CAISO’s proposal to change the components of the native load quantity used in the post-HASP process aligns with its proposed ATC related changes because it will lessen the need for any day-ahead bidding incentive for priority wheeling throughs and should enhance CAISO’s ability to manage intertie capacity more.
FERC accepted the tariff revisions, subject to a condition that CAISO remove an expiration date from the scheduling run priority tariff provisions. The revisions will be effective November 1, 2023 (for the ATC and wheeling through priority provisions) and June 1, 2024 (for the post-HASP process and bidding rule provisions).
A copy of the order, issued in Docket No. ER23-2510-000, can be found here.
