Energy Markets and Finance Committee Newsletter
The Future of Regional Electricity Markets In The Western Interconnection: Analysis of the California Independent System Operator’s Latest Market Offering in the Context of Recent Federal Energy Regulatory Commission Rulings
The Western Interconnection covers the United States from the Pacific Ocean to the Great Plains and is one of the major power grids in North America. As most other regions of the country eagerly established regional electricity markets in the wake of Federal Energy Regulatory Commission (FERC) Orders 888, 889, and 2000, which created greater generator competition and wider transmission access by encouraging the creation of Regional Transmission Organizations (RTOs) and Independent System Operators (ISOs), the Western Interconnection (outside of California) instead remained in a highly balkanized operating paradigm with minimal coordination. Today, the Western Interconnection includes 38 balancing authorities, of which 35 are in the United States.