California approves bundling of distributed power to compete in wholesale electricity market

On July 16th the California Independent System Operator Corp. (ISO) became the first electrical grid operator in the US to approve small distributed electrical generation sources, such as roof top solar, energy storage and plug-in vehicles, to be bundled together in order to compete in the wholesale electricity market in the state.  What this means is that small system owners, who previously had no influence on the price they could get for excess electricity production, can now join together and compete in the open market if, in the aggregate, they meet a 0.5 MW generation threshold. “With the rapidly evolving grid and quantum growth in distributed generation, this framework for integrating smaller renewable resources onto the high voltage grid demonstrates a significant step in re-designing our energy future with lower carbon emissions and helping California meet its clean energy goals,” said ISO President and CEO Steve Berberich. “This proposal encourages innovation and entrepreneurs to explore opportunities within the wholesale market by combining resources that individually would be too small to participate on their own.”

The proposal approved by the board outlines how these energy resources aggregations would be metered and how scheduling coordinators will interact with the ISO through a single point of contact; however, detailed processes to implement the proposal still need to be developed and approved by the Federal Energy Regulatory Commission (FERC).

For more details, see CA ISO Board.

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