If SMUD joins the EIM, it will be the first municipal utility to join ten investor-owned utilities in a real-time electricity market growing throughout the western U.S. Seven of those utilities are outside CAISO’s California service area, with Idaho power agreeing in April to enter the market in 2018.
Citing increasing penetrations of renewable energy, SMUD and BANC hope joining the real-time market will smooth integration of intermittent generation and help it trade electricity in a wider, interstate market.
But BANC noted in a statement that the key for an ideal outcome of the negotiations would be an agreement recognizing the needs of BANC’s members as public power agencies. If all goes smoothly with SMUD’s integration, other BANC members could follow suit. Members include the City of Redding, the City of Roseville, Modesto Irrigation District and Trinity Public Utilities District.
The Sacramento Business Journal notes SMUD will bring nighttime electric generation from windmills in the Sacramento Delta, dispatching renewable generation at a time when most renewable resources, such as sun, are not producing. That will mesh well in meeting California’s renewables mandate, which seeks to run the grid on 50% renewables by 2050, as well as allow SMUD to export to other states.
That enhanced power trading capability has raised concerns. While CAISO points to clean energy as a significant factor for the $64.6 million in gross benefits the market generated since it was expanded outside of California, some critics said PacifiCorp’s entry into the market could mean participants would use more coal-generated electricity.
