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NewsData's "People in Power" is an exciting new biweekly podcast that explores issues in the energy industry, featuring expert guests from a wide range of backgrounds. Hosted by veteran energy journalists Jason Fordney and Abigail Sawyer of California Energy Markets and including appearances by writers from sister publication Clearing Up, People in Power will explore trends such as development of a Western wholesale electricity trading market, the transition to a more electrified world of new infrastructure and transportation, renewables integration and reliability, wildfire response and mitigation, and many other topics. "People in Power" draws from an unprecedented pool of expertise and insight in a way never seen before! It's available on all major podcast platforms as well as at www.newsdata.com.
Intro:
Welcome to NewsData's Energy West, a podcast about the energy
industry today and where it's going tomorrow.
Dan Catchpole:
Hello, I'm Dan Catchpole, reporter with NewsData's Clearing Up.
Joined by my co-host and editor of NewsData's California Energy
Markets, Jason Fordney.
NewsData covers the energy sector in California, the Northwest
and beyond like no one else.
And here are some of our top stories that we're working on.
But first, Jason, how are you doing?
Jason Fordney:
I'm doing great, Dan. Happy Monday.
August coming to a close.
Dan Catchpole:
I know. The summer is winding down already.
Jason Fordney:
Yeah. It's hard to believe.
Halloween will be in our face before we know it.
Dan Catchpole:
Yeah, you know, to that point, my oldest daughter and I already
started working on her Halloween costume a little bit earlier
today. So she's going to go as a fruit stand.
Jason Fordney:
All right. Well, great.
And it sounds a little bit cumbersome.
Dan Catchpole:
Wait, I thought you were trying to do, like, a play on cucumbers
or something.
I don't know.
Jason Fordney:
I'm not clever enough.
Dan Catchpole:
Cucumber-some. And then we just lost, like, half the listeners.
They're like, I'm out of here.
Okay, well, let's get to something a bit more relevant than bad
fruit or vegetable puns anyways.
So what do you have going on, Jason?
Jason Fordney:
All right. Well, today I'm going to talk about the California
Independent System Operators new extended stay ahead market
proposal and a little bit of reaction on that.
Then I'll be talking about my Bottom Lines, analyzing why so far
fewer acres have burned in California this year
compared to last year.
Some reasons may surprise you.
And finally, a proposed new inland port in Kern County that will
hopefully ease the supply chain a little bit, including four
solar panels and components.
Dan Catchpole:
And I've got a little market update here for about Bonneville's
participation and some surplus
capacity sharing program across the West that's getting going.
And yeah, I've got a little update on PacifiCorp and some
allegations regarding the biggest wildfire in
California and Oregon this year.
And then some stuff going on with Northwest Natural in Oregon.
And for listeners who are not familiar with our print products,
which is available at
NewsData.com, you can find out lots more there.
Just in case anybody was wondering, Bottom Lines is the name of
the column in California Energy Markets.
It is not some weird reference to Jason Feeney's derriere.
I just want to clarify that now.
Jason Fordney:
Now, we're really deterring people.
Dan Catchpole:
All right, well, why don't you get us started with the CAISO day
ahead update?
Jason Fordney:
Sure thing. What we have here is California Independent System
Operator, or CAISO's revised extended day ahead market straw
proposal. This is an effort that's been going on for some time.
This latest proposal has important enhancements, according to
CAISO.
It includes new details, descriptions and examples of different
EDAM design elements.
EDAM standing for extended day ahead market.
CAISO says EDAM will allow for optimal commitment and scheduling
of supply on a day ahead basis and will apply equally to all of
the 19 participating members in the Western energy and balance
market.
So for those that don't know, CAISO is bringing the the day
ahead market across the footprint of the EIM, which represents
about 80% of the load in the Western interconnection.
Pretty big deal.
CAISO says the EDAM design will support the rapidly evolving
Western resource adequacy landscape.
Among the modifications are provisions concerning transmission
commitment.
There's also some new tagging requirements for firm energy
contracts, and then there's a one year transition period
for convergence bidding for EDAM entities.
Convergence bidding includes things like virtual bids, which are
financial positions taken in the day ahead market and liquidated
in the real time market.
Southwest regulators have been examining this proposal.
They're really looking to this to meet their state's clean
energy goals.
New Mexico Public Regulation Commission members said they're
receptive to the potential for the EDAM to maximize existing
transmission resources and help meet renewable portfolio
standards.
And a PRC member Steve Fishman told CAISO, quote, "I'm pretty
excited by the prospect of getting this off the ground
and being the first baby step for the West to get where it needs
to be."
Commission member Joseph Meister said he got a little nervous
about the EDAMs emphasis on maximizing transmission availability
over land use considerations, tribal concerns and other issues.
What CAISO's Phil Pettengill said, quote, "What we are trying to
do is unlock the transmission capacity that you have and try to
maximize that utilization." Over in Arizona, just to wrap up, we
have a
ACC chair, Arizona Corporation Commission, Leia Marquez Peterson
said, Based on my understanding of CAISO's current governance
structure, I have some concerns.
Governance being the big deal with any sort of regional
activities.
There seems to be a pattern, she said.
California isn't coming to the table on water as it relates to
drought on the Colorado River, and California isn't willing to
change its governance structure for a regional energy market.
These are critical issues.
She sort of drifted over into the topic of a Western RTO.
But yeah, the EDAM CAISO will be taking comment on this through
August 29th with in-person meetings
September 7th and 8th.
I'm sorry, stakeholder comments are due by September 20th.
So that's the new EDAM.
You can find that on the CAISO website, and you can read more
about it on NewsData.com.
So back to you, Dan, for the Northwest or what you have for us.
Dan Catchpole:
Yeah. So speaking of CAISO's EDAM.
The Bonneville Power Administration has agreed to participate in
the next phase of the Southwest Power
Pool's Markets Plus Initiative, which is kind of like competing
design to CAISO's EDAM.
Now, BPA is also participating in the development of EDAM, but
it has made a public
commitment to supporting at the same time the development of the
markets plus initiative.
And so it's been really interesting covering the development of
these two.
Clearly, actors in the West are really open to further
coordination through market structures, and you've got these
two big competing entities, Cal ISO and South West Power Pool.
So that's good news for, well for both I suppose, that
Bonneville is all on board for further market
coordination.
And in another step forward for markets, members of the Western
Power Pools, new surplus capacity sharing program approved a
tariff last Thursday.
Formalizing the program structure and how it operates.
The tariff includes an independence governing structure and
punitive charges.
If any participant doesn't meet the program's operational
requirements, things like and maintaining an adequate planning
reserve margin.
So the program is officially known as the Western Resource
Adequacy Program, often shortened to RAP.
So the RAP tariff next goes to power pools board of directors
for review, and if they sign off on it, it will be sent
to FERC for final approval for implementation.
The program is being rolled out in phases.
The current timeline calls for the program to go live in a beta
testing period in the summer of 2023
with full implementation in 2025.
The purpose of the program is essentially to coordinate and
streamline.
It basically makes better use out of any surplus capacity during
times when the market is tight.
To make it less likely that any entity has to gets into a load
shedding event where they just don't have enough
capacity to meet demand.
So that's obviously becoming an increasing concern, and this has
developed in the past few years as a method
to hopefully decrease that vulnerability.
Jason Fordney:
Yeah. I see the current timeline calls for going live next
summer.
Dan Catchpole:
Yes. Yeah. Testing period, in summer 2023.
Jason Fordney:
And full implementation in 2025.
Dan Catchpole:
And there's already in some of the early kind of pre
implementation stages.
But yeah, it's been figuring out some of the details of how the
thing's going to work.
Jason Fordney:
Sure. Yeah.
Just so much happening in the West on resource adequacy markets.
It's a great time to be an energy reporter, and it's a great
time to subscribe to NewsData's Energy Markets.
Dan Catchpole:
That's definitely true. And Clearing Up.
Jason Fordney:
Oh yeah.
Dan Catchpole:
You can find out more about our fine products at NewsData.com.
Jason Fordney:
Excellent. All right.
Well, good coverage on that.
Thank you. We had a really strong market coverage in our issue
last week, and we'll continue.
I wrote in my Bottom Lines about the acreage burned by wildfires
in California so far this year is down dramatically from 2021,
despite a similar number of incidents.
Analyzing why this is the case can be a bit tricky.
As I found.
What we have about 198,000 acres of burned in wildfires this year
in the Golden State.
That's according to Cal Fire.
Last year at this time, 1.5 million acres.
So 198,000 compared to 1.5 million.
This year's tally is also far lower than the five year average
for acres burned at this point in the year, which is about
724,000. The number of incidents this year is 5,415, compared
with
5,968 by this time last year.
I talked to Cal Fire spokesman Robert Foxworthy.
He said, quote, "We're looking better.
I feel like we're in a really good spot compared with last
year." He did note the ongoing drought and the dryness of
vegetation has created ideal conditions for fires, but wildfire
response has improved.
While firefighters catching more fires when they're still
small, we're still getting the starts, but we seem to be catching
them this year. There's also been a big increase vegetation
management and inspections by utilities.
I asked Robert about utility caused wildfires, whether they're
on the downtick or uptick.
He said it's too soon to say.
PG&E did say they've mitigated fire risk in about 90% of their
territory.
So some good news.
You know, it's great. I live here in wildfire country.
There hasn't been a lot of smoke, not a lot of fires.
But one reason when you look at this acreage, last year, we had
two fires that burned
almost a million acres.
That was Caldor and the Dixie Fire.
So that's what really pushed up the numbers last year.
But all in all, some good news on the wildfire front here in
California.
Dan Catchpole:
And Jason, in talking to Robert Foxworthy from Cal Fire, did you
get any
sense as to whether how much this is due to sort of like a
change in trend because of
changes in practices, or what have you?
Versus just it was a wetter year?
Was it just conditional, or do you think these are improvements
that can be sustained?
Jason Fordney:
I think the response has improved.
I also talked to Robert Lewin, who's with Resolute Associates,
former fire captain, very experienced.
He said there's been a really aggressive firefighting with
deployment of large firefighting resources occurring on even more
remote lands. What happened last year was a lot of competition
for resources because we had big fires going on at the same time.
And that Dixie Fire particularly nasty.
But it seems to me a combination here: better response, less
competition for resources, more wildfire
mitigation, and maybe just a little bit old fashioned luck, too.
Dan Catchpole:
Well, some folks up in Oregon were not so lucky.
A group of homeowners who lost their homes in the McKinney fire
say PacifiCorp's equipment caused the wildfire along the Oregon
California border.
The lawsuit alleges that the ignition of the fire was
foreseeable and PacifiCorp's, quote, "negligently, recklessly and
willfully" end quote, failed to properly maintain its equipment.
That complaint was filed in Sacramento County Superior Court,
and they're being represented by San Diego law firm Singleton
Schreiber. The fire started July 29th in the Klamath National
Forest, and so far it's the biggest wildfire of the season in
California. It tragically has killed four people.
And as of last week, Cal Fire reports that nearly 200 homes and
other buildings have been destroyed.
In last update from that I saw last week was that it was almost
entirely contained though.
Jason Fordney:
Yeah, I think it was 95% on Friday.
Dan Catchpole:
Yeah, that sounds right.
Jason Fordney:
Yeah. Cause still under investigation.
I guess I did find a notice that PacifiCorp filed with the
California Public Utilities Commission, said it was notified of
the fire on July 29th and that the PacifiCorp distribution
circuit in the area is the 5G40 out of the Scott Barr
substation. But we should stress that it's not been proven that
PacifiCorp caused this fire.
Dan Catchpole:
Yes, these are purely allegations.
Jason Fordney:
Yep. All right.
Well, some tough news there.
We'll see what happens with that.
Finally, I have hear from CEM.
A new inland port proposed in Kern County, which Kern County
officials hope will ease choke supply chains, including for
imported energy system components such as solar panels.
Kern County Board of Supervisors August 9th Proclamation
supports a newly announced inland port that is also forecast to
reduce greenhouse emissions from coastal ports.
This is called the Mojave Inland Port, designed to alleviate
supply chain pressures at ports of Los Angeles and Long Beach,
should also address air quality issues, as goods offloaded at
the coastal ports will now be transported via rail to the new
hub rather than via truck.
So good to see that. Some good news for Kern County.
And hopefully.
Yeah, we've obviously been hearing a lot about supply chain.
This will take some time to be constructed, but we'll hopefully
help.
Dan Catchpole:
So if I understand it correctly, the idea around this inland
port, it's obviously Kern County is
landlocked, obviously.
So I don't think there's any major river that runs through there
that reaches down to the coast like that.
But so it's instead of putting this stuff on trucks, the idea
is, like you said, it goes over rail in that that's where they
get the idea of the inland port, kind of just like how container
shipping comes into a port.
Just kind of making that faster, bigger transit of these goods to
the
interior. Is that the gist of it?
Jason Fordney:
Yes. I think one of the issues is trucks idling at the ports.
You know, the ports are, of course, a massive source of
emissions, but this will eliminate that.
You know, these containers can move via rail or truck.
Usually this port will be able to handle about 3 million
containers per year.
So it's not a small one.
They'll be transported from the seaports via shuttle trains.
Utilizing the underutilized Alameda corridor, which should also
create some more economic benefits.
Dan Catchpole:
Well, the last thing I've got here is Northwest Natural, natural
gas utility, wants to start field testing it's proposed one
megawatt, Eugene Hydrogen Pilot project.
The project would use an electrolyzer to create hydrogen from
water and the hydrogen that would then be injected into Northwest
Natural's natural gas supply lines around Eugene, Oregon, where
it's got about 2,400 customers.
The company hopes to deliver an initial blend of 5% hydrogen gas
in its distribution service and with
the potential of that going up to 10% down the road, according
to a Northwest Natural filing with the Oregon PUC.
At the same time, a group of local lawmakers and more than 30
organizations have asked, and I should say, this is a
Northwest natural story, but separate from the hydrogen
projects, I want to make that clear.
A group of local lawmakers in more than 30 organizations have
asked the Oregon Department of Justice last week to investigate
Northwest Natural for what they accuse or say are deceptive
advertising practices.
The group alleges that the natural gas utility conductedwhat
they call a propaganda campaign aimed at delaying the transition
to clean energy homes.
The campaign, the group alleges, misled customers, elected
officials and Oregonians at a time at large about the climate and
health risks of methane gas appliances at the time when
lawmakers were considering state policies to decrease the use
of natural gas in homes.
Northwest Natural Gas told my colleague Steve Ernst last week
that it is aware of the allegations and it is assessing them.
So you can follow that story and more at Clearing Up at
NewsData.com.
Jason Fordney:
Okay. We'll keep us posted on whether that investigation happens.
Dan Catchpole:
Yeah. Lots going on this last week and lots more to cover this
week.
I don't know about you, but I've got a busy week.
Jason Fordney:
Yeah, great. I'll be writing up some new CAISO's energy storage
enhancements.
We have a CPUC meeting, so yep, things are kicking off pretty
quickly.
Dan Catchpole:
Yeah, I've got some development in Montana to catch up with and
various other things taking shape down.
But. Well, that's it for me.
Dan Catchpole, thank you all for listening.
As always, please rate and review this podcast in Apple
Podcasts, Spotify or however you listen.
And if you like it, please let other people know about it.
You can find me. I'm on Twitter, I'm at @DCatchpole and my
cohost Jason Ford is on Twitter at
@FordneyEnergy.
Jason Fordney:
Yes, I am. And thanks for listening to NewsData's Energy West.
You can read more of our coverage at NewsData.com.
Nobody covers energy in the West like we do.
Follow us on Twitter.
CEM is at @CEMNewsData.
That's the letters C-E-M NewsData.
Clearing Up is at @CUNewsData.
Again, that's the letters C-U NewsData.
Thanks for listening, and we'll see you back here next week.
Intro:
You've been listening to NewsData's Energy West, a podcast about
the energy industry today and where it's going
tomorrow.