By Michael J. Gergen, Eli Hopson, and Andrew H. Meyer

The California Independent System Operator (“CAISO”) is moving forward with a stakeholder initiative to examine issues with connecting energy storage facilities to the CAISO controlled grid under the CAISO’s existing interconnection rules, and to develop new policies as needed to clarify and facilitate interconnection of energy storage. 

By Michael J. Gergen, Jared W. Johnson, and Andrew H. Meyer

The California Independent System Operator (“CAISO”) has taken a significant step toward proposing a new ancillary service known as the “Flexible Ramping Product” as part of its market design.  With increasing levels of variable energy resources on the CAISO-controlled grid, maintaining power balance requires increased ramping capability, as the variable outputs of the renewable resources may increase the magnitude of 5-minute to 5-minute net load changes.  In a Straw Proposal issued June 2, 2014, the CAISO proposes to use the Flexible Ramping Product to address these emerging operational challenges relating to maintaining power balance in real-time dispatch.  In doing so, the CAISO emphasized that while its existing regulation service product could be called upon to address forecast uncertainties, procuring more regulation service is problematic from an economic and market efficiency perspective both because the generating capacity of some resources must be reserved to provide regulation service and because more real-time dispatch prices will be compensated at administratively-set penalty rates.  The CAISO stated that its Flexible Ramping Product is designed to deal with uncertainties that are realized before the binding real-time dispatch using a market-based design to procure ramping capacity in the CAISO’s day-ahead market, fifteen-minute market and real-time dispatch.

By Michael Feeley and Aron Potash

A lawsuit which delayed and once threatened to dismantle California’s greenhouse gas (GHG) cap and trade scheme was largely resolved last week, removing one roadblock to California’s plan to be the first state to impose an economy-wide GHG trading program.  Under modified regulations adopted by the California Air Resources Board (CARB) on October 20, 2011, California will require certain emitters of GHGs to obtain allowances or offsets in amounts commensurate to their respective emissions

By John H. Kenney, James I. Mann, John B. Sherrell, and Haim Zaltzman

With Governor Jerry Brown recently signing into law Senate Bill 2, which increases California’s Renewable Portfolio Standard to 33 percent by 2020, the push to develop and finance renewable energy projects in California is likely to gain further momentum.  Financing renewable energy projects in California, however, has re-exposed lenders to the “one-action rule.” The one-action rule places limits on the ability of lenders to enforce

On September 7, 2010 Energy Secretary Steven Chu announced the issuance of the first loan guarantee under the Department of Energy’s (DOE) Financial Institution Partnership Program (FIPP).  The DOE issued the partial guarantee for a $98.5 million loan being made by John Hancock Financial Services to a subsidiary of the Nevada Geothermal Power Company (NGP) in respect of the 49.5 megawatt Blue Mountain geothermal project (PDF) located Humboldt County in Northwestern Nevada.  The blended interest rate for the loan was determined