The West covers all or a portion of Washington, Oregon, Idaho, Montana, Wyoming, South Dakota, Nevada, Utah, Colorado, Arizona, New Mexico and Texas. The West region is part of the wider Western Electricity Coordinating Council (WECC) which is responsible for coordinating and promoting Bulk Electric System reliability in the Western Interconnection.
The region is dominated by large, vertically-integrated utilities with a history of self-build as the primary buyers and suppliers of power. The creation of a regional market has been proposed but multiple efforts to expand the footprint of the CAISO to other Western states have stalled.
How is the market structured?
The West has a vertically integrated electricity market. Independent power producers may provide power to incumbent utilities under power purchase agreements.
What are the geographic boundaries of the market?
The West covers all or a portion of Washington, Oregon, Idaho, Montana, Wyoming, South Dakota, Nevada, Utah, Colorado, Arizona, New Mexico and Texas.
What are the relevant price and delivery zones?
State Public Service/Utility Commissions are responsible for setting electricity rates. Nodal pricing does not exist in the West.
Can I buy long-term power in the traded markets?
Buyers and sellers can hedge their exposure in the forward market within a ~5 year window via over the counter trading platforms.
Who do I need to contract with to buy power?
Many consumers receive power from their local utility (the utility covering the geographic area in which the load is located). Consumers can also opt to buy power directly from a generator, or through a retailer (in states where competitive retail markets exist) though the utility will continue to charge certain fees (i.e. transmission/distribution/other system fees).
Retail choice is available in Oregon (commercial & industrial customers only) and Texas.
How are system costs and other social charges levied?
In general, a bill can be broken into three components: generation, transmission and distribution. In a vertically integrated market, these costs reflect the local cost of the utility.
How do I prove I've bought renewable power?
In the US, renewable generation is certified and tracked using RECs (Renewable Energy Certificates). One REC is issued for every MWh of eligible renewable energy that is delivered to the electric grid. A REC contains unique identifying details of the energy generated, including the renewable fuel type, project name and location, the vintage of the project and the generation, and serial number.
Within the West, the Western Renewable Energy Generation Information System (WREGIS) is used to track generation ownership and attributes, including RECs.
How are RECs procured? Market transactions or long-term contracts.
Are renewable Power Purchase Agreements (PPAs) available? Yes
Are Green Tariffs available? Yes. Green tariffs are available in Washington, Wyoming, Nevada, Utah, Colorado, and New Mexico.
What are the key institutions?
- Multiple balancing authorities
Key Government Departments:
- State energy departments which oversee policy related to power markets within their state.
- Public Service/Utility Commissions which regulate and oversee the electricity industry in their state.
- The Federal Energy Regulatory Commission (FERC) is the federal agency that regulates the transmission and wholesale sales of electricity in interstate commerce.
- The North American Electric Reliability Corporation (NERC) is a not-for-profit international regulatory authority whose mission is to assure the reliability and security of the bulk power system in North America.
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