State Needs New RA Sales Framework as Market Tightens

California Energy Markets

Guest Editorial: State Needs New RA Sales Framework as Market Tightens
Bottom Lines, Issue 1541, May 31, 2019

SUMMARY: A tightening market for resource-adequacy supply has created problems for load-serving entities, including community choice aggregators that say state RA procurement policies need updating. In this guest editorial, the California Community Choice Association says action is urgently needed to address possible market power in RA supply, and presents a platform of changes for the California Public Utilities Commission to consider. -Editor

It is now more important than ever that California take steps to address a rapidly evolving energy market as the state focuses on ways to advance the safety, reliability and affordability of electricity service, while also staying on track to achieve ambitious climate goals.

California’s resource-adequacy program–a critical tool to ensure load-serving entities procure the resources that are needed to keep the lights on–is one area where swift action is needed. The RA market is tightening and some load-serving entities are finding it impossible to meet their RA requirements, resulting in increasing waivers and penalties.

A confluence of factors is contributing to these problems in the RA market, including a growing number of LSEs competing to buy the same resources and a shrinking pool of resources LSEs can procure due to the planned retirement dates of older natural gas plants.

But outdated RA policies and practices might be the main culprit.

Read more here: