By Michael Gergen, Jared Johnson and Andrew Meyer

The California Independent System Operator (CAISO) has announced that it is starting a new “Reliability Services” stakeholder process.  In a January 14, 2014, Market Notice the CAISO said that the new stakeholder process would address three related issues: (i) the development of a replacement proposal for the backstop capacity procurement provisions of CAISO’s Tariff; (ii) the design of a market-based mechanism to replace the CAISO’s current backstop capacity procurement authority, and (iii) updates to the standard must-offer requirements for local, flexible, and system resource adequacy capacity.