Yale Report on Western Grid Integration: Just Say Yes
A strong and timely endorsement for western grid integration forcefully rebuts claims that moving from a balkanized system with 38 separate entities to a regional operation could introduce environmental problems, raise costs, or open state energy and climate policies to challenge by federal regulators. In fact, the analysis released today by Yale University’s Environmental Protection Clinic identifies numerous economic and environmental benefits from allowing the California Independent System Operator to become a regional grid operator.
The groundbreaking report comprehensively examines the policy and legal merits of allowing the California Independent System Operator (CAISO) to become a regional grid operator, open to any western utility or generator that wants to join.
The Yale report identifies the increasing constraints that today’s fragmented western grid imposes on system-wide electricity costs and reliability, addresses the potential benefits of integration, and evaluates potential legal risks for the states involved. California receives particular attention because its legislature is considering the first step in the grid integration process, which involves authorizing the CAISO to create a fully independent board (other western states are unlikely to approve joining an entity whose governance is determined solely by California’s governor and legislature, as is the case now).
Elements of the report
The analysis examined all of California’s key energy and climate policies, from its cap on carbon emissions to its renewable energy goals and its pollution standards for power plants, and concludes that none would face additional legal risks under a fully integrated western grid. The operator of such a grid would be regulated by an independent federal agency (the Federal Energy Regulatory Commission)—but so is the CAISO itself, now and since its inception, by virtue of its extended involvement in interstate electricity commerce throughout the West.
And if empowered to serve the entire region, the CAISO would not interfere with the longstanding rights of California and other states to regulate their utilities’ investments or set energy and climate policies. The study points out that grid operators don’t set energy policies for the states they serve; they help those states minimize costs, enhance reliability, and avoid unnecessary pollution.