An Energy Imbalance Market (EIM) is a dynamic real-time energy supply market that provides electricity generation and transmission services. It automatically adjusts demand every 15 minutes and dispatches power plants to meet demand efficiently every five minutes, utilizing the most affordable energy sources. It contributes to improved economic efficiency in the power system. This centralized, automated approach to generation economic dispatch spans regions, attracting an increasing number of participants and encouraging increased benefits for all customers through greater diversity.
This cutting-edge, Energy Imbalance Market (EIM) automatically deploys the most cost-effective electricity-generating resources to meet short-term utility customer requirements. The market optimizes the use of renewable energy sources across the Western United States and a Canadian province. Using advanced technology, the Energy Imbalance Market (EIM) facilitates coordinated power sales and purchases among participating utilities, effectively balancing the fluctuating demand and supply of electricity. This streamlined process facilitates the integration of variable renewables such as wind and solar power, with the ultimate goal of delivering cost savings to customers while also contributing to a cleaner and more secure power supply.
What is Energy Imbalance?
Energy Imbalance is the difference between the Energy tagged, scheduled, offered, and dispatched by a Transmission Provider or required to be supplied to a Transmission Provider within a specified timeframe. It reflects the variance from the actual quantity of Energy delivered to that Transmission Provider.
Similarly, it denotes the difference between the volume of electricity communicated to the transmission or distribution system operator for injection or withdrawal at specified locations within a specified timeframe. This discrepancy is compared to the metered quantity of electricity withdrawn or injected at those same locations during the same period.
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What is Energy Imbalance Charge?
Energy Imbalance Charges are imposed by a utility or transmission provider, transmission authority, or control area services provider as a result of differences between the delivered energy at the Energy Point of Delivery and the scheduled quantity intended for delivery at that same Energy Point. These charges encompass excess energy costs, losses resulting from Utility or T&D Provider settlements, and fees tied to excessive energy procurements, along with any associated legal expenses. Such fees become applicable when there are discrepancies between an account’s energy demands and the amount of energy supplied by the utility, or in instances of non-compliance with a Utility Curtailment Notice.
What is the Cause of Energy Imbalance?
The primary cause of energy imbalance is the potential increase in variable renewable generation such as wind and solar power. This influx of renewable sources, particularly the significant increase in solar generation, is causing concern, particularly in the smaller balancing authority areas (BAAs) of the Western Interconnection. As a result, system operators are faced with the difficult challenge of balancing electricity production and demand.
Moreover, due to expected load growth and difficulties in locating suitable sites for new transmission and generation resources, the future conditions of the Western Interconnection may face increased stressors. This implies that the changing energy mix, as well as the dynamics of integrating renewable energy, may contribute to an energy imbalance in the Western Interconnection.
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