Comments on Working group 5

1. Provide a summary of your organization’s comments on the November 27, 2023 GHG Coordination working group discussion:

Please see the attached comments from the Department of Market Monitoring.

2. Provide your organization’s comments on the current and proposed GHG metrics published by the CAISO:

Please see the attached comments from the Department of Market Monitoring.

3. Provide your organization’s comments on the consolidated problem statements:

The consolidated problem statements are available to reference on the GHG Coordination working group webpage.

Please see the attached comments from the Department of Market Monitoring.

4. Provide any questions you have on the current GHG design that you would like the ISO to answer:

Please see the attached comments from the Department of Market Monitoring.

5. Please list the following topic areas in order of highest priority for discussion to lowest priority for discussion – Market Operations and GHG Design, State Coordination, Emissions Tracking and Accounting, Beyond GHG Price-based Policy:

Please see the attached comments from the Department of Market Monitoring.

6. Please list the consolidated problem statements (PS 1-6) in order of highest priority for discussion to lowest priority for discussion.

The consolidated problem statements are available to reference on the GHG Coordination working group webpage. The ISO is dedicated to addressing each problem statement, but will use the top listed problem statements to indicate near term priorities for assessment and further discussion if necessary.

Please see the attached comments from the Department of Market Monitoring.

7. Additional comments:

Please see the attached comments from the Department of Market Monitoring.

1. Provide a summary of your organization’s comments on the November 27, 2023 GHG Coordination working group discussion:

CRS provides comments on CAISO Staff’s presentation of current and proposed GHG metrics, and on the consolidated problem statements. Overall, we think that CAISO should provide multiple new metrics, including different versions of average emissions rate, attributed generation data, and unallocated (residual) generation data. We express general support for consolidated problem statements. We’d like to better understand CAISO’s approach to and rationale for consolidation and ensure that our previous feedback on the previous problem statements will not be lost. We also provide feedback on prioritization.

2. Provide your organization’s comments on the current and proposed GHG metrics published by the CAISO:

Regarding the GHG attributions by fuel type (formerly the WEIM transfer by fuel type into the ISO by fuel type) currently published by CAISO, there is a need for this market attribution data to be broken out into attributions from generators registered in WREGIS and generators not registered in WREGIS, and for the portion of this attributed generation that is from WREGIS generators to be shared with WREGIS. See previous our comments. The non-WREGIS generation portion is also of interest since, according to CAISO, most of attributed generation is hydropower and that hydropower may also be claimed for customers in WA and OR and different states and/or programs may consider market attribution of that generation to affect the eligibility of the retail claim in that state/program.

We appreciate CAISO Staff’s presentation of potential future GHG metrics, though it was limited to average emissions rate. We have suggested other metrics in previous comments, and we generally agree with stakeholders at the Nov 27 meeting that CAISO should consider different boundaries around different categories of energy, including an average for entire market footprint, generation deemed to GHG-pricing states/zones (attributed generation by zone), and residual market generation (unallocated generation) over different timeframes.

Regarding the average emissions rate metric, we’ve said in previous comments is that stakeholders could use this to understand the impact of incremental generation, conservation, load-shifting, for siting (of load or generation) decisions, as opposed to for retail claims and reporting, for example. In that case, CA attributions should not be excluded from the system average, since that would describe something more like a residual rate, which could be used for retail claims and load-based accounting for market purchases. We generally agree with other stakeholders at the Nov 27 meeting that CAISO should not limit this information to a single average. Rather, it can provide many different averages, e.g. with DR and without, relative to the base schedule and all scheduled, etc., and just explain the differences.

In terms of how bilateral transactions between BAs should be treated in the average, whereas these don’t need to be included in systemwide generation-based average, they could be included in an average that accounts for imports and exports. Again, we suggest calculating both. For that, rather than using the default unspecified rate of 0.428 tons/MWh, CAISO should work with other BAs and data providers to get them to adopt similar metrics and use the appropriate metric, e.g. system residual rate of the exporting region. This coordination and consistency is important to avoid double counting.

In terms of treatment of missing data, we think it is appropriate to estimate using similar resources from the master file or make other reasonable assumptions until resource-specific data is available.

3. Provide your organization’s comments on the consolidated problem statements:

The consolidated problem statements are available to reference on the GHG Coordination working group webpage.

We thank CAISO Staff for their efforts to consolidate the problem statements. In our Nov 7, 2023 comments, we provided substantial feedback on previous problem statements #5, 7, 8, 9, and 15, and we commented that the most important, from our perspective, were #5, 6, 7, and 8. 

It would be helpful for CAISO to further explain how the previous problem statements have been consolidated into the new ones—i.e. how the previous list relates to the new list—and how feedback received on the previous problem statements will be organized under and applied to the new ones. This will help us confirm our understanding, provide additional feedback, and hopefully avoid reiterating previous feedback regarding data, analysis, examples, metrics, etc.
 
We assume that 5 became 4b. We assume that 6 was also consolidated into 4. But we’re not sure 6 is fully captured—double counting resulting from inconsistent accounting in GHG pricing policies and market attribution. 4c also seems new. We understand the role of CAISO in addressing 4b, but it not as clear to us how CAISO would address 4c, except by providing additional data/metrics and explaining how they can be used for different generation-based vs. load-based programs. More explanation would be helpful.

We assume that 7 became 6a, and that 8 became 5b. But 8 may not be fully captured, since 5b is only about LSEs in non-pricing states, additional reporting metrics are also needed by states with load-based programs (including states that also have GHG pricing), customers in all states, and voluntary programs.

It is also not entirely clear to us:
•    whether 3 and 6b are new;
•    whether previous 4 has been captured somewhere;
•    whether previous 10 was consolidated into 4a; and
•    whether previous 13 was consolidated into 4b.
 

4. Provide any questions you have on the current GHG design that you would like the ISO to answer:

None at this time.

5. Please list the following topic areas in order of highest priority for discussion to lowest priority for discussion – Market Operations and GHG Design, State Coordination, Emissions Tracking and Accounting, Beyond GHG Price-based Policy:

1. State Coordination 
2. Emissions Tracking and Accounting
3. Beyond GHG Price-based Policy
4. Market Operations and GHG Design

This is because we prioritize avoiding double counting, better data for accurate accounting/reporting and market participation, attribution for non-pricing states again for market participation, and then improvements to limit secondary dispatch.
 

6. Please list the consolidated problem statements (PS 1-6) in order of highest priority for discussion to lowest priority for discussion.

The consolidated problem statements are available to reference on the GHG Coordination working group webpage. The ISO is dedicated to addressing each problem statement, but will use the top listed problem statements to indicate near term priorities for assessment and further discussion if necessary.

4 (4b)
5 (5b)
6 (6a)
3
2
1
 

7. Additional comments:

None at this time.

1. Provide a summary of your organization’s comments on the November 27, 2023 GHG Coordination working group discussion:

LADWP appreciates the GHG working group discussions and opportunity to comment.

2. Provide your organization’s comments on the current and proposed GHG metrics published by the CAISO:

LADWP would like to see metrics that quantify the financial and emission impacts of CAISO's GHG design and attributions in EIM and EDAM including the following for each financially binding time interval in EDAM, RTPD, and RTD:

1. Net import into the GHG regulation zone and marginal cost of GHG (or marginal GHG emission rate) for electricity deemed delivered to serve load in the GHG zone.
   1. LADWP recognizes that in cases when marginal GHG cost is driven by a marginal emitting resource within the GHG zone, it is necessary to break out the carbon adder component from its energy bid.
2. For resources deemed as supporting an import into a GHG zone, the total MWH of GHG attribution separately above base schedules/GHG references and below base schedules/GHG references.
3. Total MWH and GHG emissions of emitting resources outside of GHG zones dispatched above the base schedule/GHG reference and not deemed for delivery into a GHG zone.
4. The dollar amount of GHG revenue distributed to zero-emitting resources within GHG and non-GHG zones.
5. The dollar amount that would be paid to emitting resources if paid highest as-bid GHG for resources wrongly deemed beneath the base schedule.

CAISO should report on the resources and associated GHG emissions deemed to have served Load in a GHG zone. CAISO should make reports available at the lowest level of granularity possible along with daily, monthly, and annual summaries.

In addition, LADWP would like to see a graph comparing the marginal GHG emission rate for deemed delivered imports (below the EIM base schedule) to California and Washington for each market interval to the default GHG emission factor for unspecified electricity (0.428 metric tons CO2e/MWh).

3. Provide your organization’s comments on the consolidated problem statements:

The consolidated problem statements are available to reference on the GHG Coordination working group webpage.

As previously raised by LADWP, the problem statements do not consider the limitations of the resource specific approach when GHG zones and/or individual load-serving entities have declining emission targets and ultimately a zero-emission or carbon neutral target. See #4 below for a suggestion how this problem can be addressed.

4. Provide any questions you have on the current GHG design that you would like the ISO to answer:

1) Can "Beyond GHG Price Based policy" be expanded to include how emission reductions can be implemented in GHG zones, as the current resource specific method does not contemplate specific LSE targets in GHG zones.

• In resolving how to reflect a declining cap on emissions in states that do not have a carbon pricing program, a similar approach may also be applicable to Cap and Invest/Trade states that also have declining caps on emissions to ensure load is served by generation and wholesale market transfers that meet those emission reduction targets.

2) How does GHG revenue collected at the marginal GHG emission rate compare to the actual resource-specific GHG compliance cost, and where does any surplus GHG revenue go?

5. Please list the following topic areas in order of highest priority for discussion to lowest priority for discussion – Market Operations and GHG Design, State Coordination, Emissions Tracking and Accounting, Beyond GHG Price-based Policy:

Priority (highest to lowest) for topic areas: 1) Emissions Tracking, Accounting and Reporting, 2) an adaptation of Beyond GHG Price Based policy that looks at declining emission targets in GHG areas, 3) State Coordination, and 4) Market Operations and GHG Design.

6. Please list the consolidated problem statements (PS 1-6) in order of highest priority for discussion to lowest priority for discussion.

The consolidated problem statements are available to reference on the GHG Coordination working group webpage. The ISO is dedicated to addressing each problem statement, but will use the top listed problem statements to indicate near term priorities for assessment and further discussion if necessary.

 Priority (highest to lowest) for problem statements: 5, 6, 4, 2, 1, 3

7. Additional comments:

None at this time.

1. Provide a summary of your organization’s comments on the November 27, 2023 GHG Coordination working group discussion:

1. PG&E urges CAISO to prioritize load-based accounting, aligning with the initiative’s motivation and addressing the issues in problem statements 1-4
2. PG&E suggests CAISO prioritize addressing problem statement 1, followed by statements 2-4, and lastly statements 5-8.

2. Provide your organization’s comments on the current and proposed GHG metrics published by the CAISO:

PG&E advocates for market transparency and supports additional metrics to inform participants on the GHG intensity of the market.  We support the development of the average emissions metric and agree with other stakeholders that comparing more than one formulation is essential before deciding on the final version.  

3. Provide your organization’s comments on the consolidated problem statements:

The consolidated problem statements are available to reference on the GHG Coordination working group webpage.

4. Provide any questions you have on the current GHG design that you would like the ISO to answer:

No questions at this time.

5. Please list the following topic areas in order of highest priority for discussion to lowest priority for discussion – Market Operations and GHG Design, State Coordination, Emissions Tracking and Accounting, Beyond GHG Price-based Policy:

1. Market Operations and GHG Design (i.e., Problem Statement 1)
2. Beyond GHG Price-based Policy (i.e., Load-Based Accounting)
3. State Coordination (i.e., whether Load-Based Accounting can better align CA's and WA's programs)
4. All other problem statements

6. Please list the consolidated problem statements (PS 1-6) in order of highest priority for discussion to lowest priority for discussion.

The consolidated problem statements are available to reference on the GHG Coordination working group webpage. The ISO is dedicated to addressing each problem statement, but will use the top listed problem statements to indicate near term priorities for assessment and further discussion if necessary.

PG&E suggests the following prioritization:

1. Problem Statement 1 and consideration of load-based accounting
2. Problem Statements 2 & 3 and consideration of load-based accounting
3. Problem Statement 4 and the consideration of load-based accounting
4. Problem Statements 5 – 8.

7. Additional comments:

1. Provide a summary of your organization’s comments on the November 27, 2023 GHG Coordination working group discussion:

PacifiCorp thanks the CAISO for allocating time during the GHG coordination working group process to allow PacifiCorp to present on its compliance accounting and reporting challenges as a multi-jurisdictional Balancing Area Authority (BAA) and Load-Serving Entity (LSE). PacifiCorp operates in six states as a retail provider, operates two BAAs, PACE and PACW, and is subject to numerous emissions and renewables compliance accounting frameworks. PacifiCorp’s unique position of being a multijurisdictional LSE has long been recognized and accommodated by its regulators, so that the emissions attributes of the resources are aligned with the resources paid for by retail customers in those states. These provisions include cost-based allocation methodology of emissions, as discussed by ODEQ and PacifiCorp during the working group meeting on November 27th, 2023. Preservation of this cost-based -allocation methodology for states' emissions accounting ensures there is equitable sharing of its system for all customers, leverages geographic diversity for decarbonization of the system as a whole, and ensures the benefits of ratepayer investments are realized and claimed appropriately. 

PacifiCorp also posed a recommendation for compliance accounting treatment of EDAM settlements to and from PacifiCorp BAAs.  PacifiCorp recommends that the reporting framework preserve consistent treatment across both California and Washington and consider the BAA as outside the GHG regulation area. Without doing so, there is a risk of double counting or undercounting when doing cost-based retail load allocation due to the market’s inability to isolate specific market transfers to PacifiCorp’s retail load. PacifiCorp is keen on finding workable solutions for transparency into the market's emissions, for states with both price-based and non-price based carbon programs. PacifiCorp supports the continuation of dialogue between the market operator, state regulators, and market participants. 

2. Provide your organization’s comments on the current and proposed GHG metrics published by the CAISO:

PacifiCorp generally supports the CAISO’s preparation of an Average Emissions Rate (AER) to represent the composition of the market at a given interval; however, the appropriate composition of and applications of such data should continue to be explored. For example, if such data were used to represent the emissions content of unspecified market purchases, PacifiCorp asserts that this determination must be made by state air regulators after robust stakeholder processes. During the call, the CAISO asked stakeholders to opine on the methodology for preparation of the AER and provide feedback on questions such as the types of resources the metric should incorporate and if the metric should use all schedules or only those relative to the WEIM optimized base schedule. PacifiCorp suggests that using the WEIM optimized schedules relative to the baseline is more appropriate, as those schedules are representative of the market’s total emissions. To further explore the calculation, the CAISO could look at variations of the metric by adding or subtracting supply resource types.  

The CAISO also asked how missing emission data should be treated. PacifiCorp generally supports the CAISO using emission rates for resources that are similar technology type as proxy for resources that do not have existing emissions rates in the Masterfile, however, it is important to note that similar technology types could have emission rates which are vastly different, that the CAISO should consider. The CAISO shared an example of AER calculation that yielded two results. One emission rate resulted from electricity imports into the WEIM through bilateral transactions plus electricity generated in the WEIM and the other resulted from attributed megawatt hours through WEIM transfers. Since reporting is done after-the-fact, PacifiCorp recommends the CAISO embed the attributed MWhs into the overall system AER rather than showing separate quantities. Finally, PacifiCorp is unsure whether there will be a separate AER for EDAM participants or whether the final AER calculated will reflect EDAM and WEIM participants. PacifiCorp looks forward to continued discussion on this metric.   

3. Provide your organization’s comments on the consolidated problem statements:

The consolidated problem statements are available to reference on the GHG Coordination working group webpage.

PacifiCorp believes the problem statements were consolidated appropriately. 

4. Provide any questions you have on the current GHG design that you would like the ISO to answer:

PacifiCorp would like the working group to take some time to go through examples on how the EDAM and WEIM baseline/counterfactual will work in EDAM and how it works today in WEIM.  

5. Please list the following topic areas in order of highest priority for discussion to lowest priority for discussion – Market Operations and GHG Design, State Coordination, Emissions Tracking and Accounting, Beyond GHG Price-based Policy:

PacifiCorp’s ranking from highest priority to lowest priority for discussion: 

1. Emissions Tracking and Accounting
2. Market Operations and GHG Design 
3. Beyond GHG Price-Based Policy 
4. State Coordination 

6. Please list the consolidated problem statements (PS 1-6) in order of highest priority for discussion to lowest priority for discussion.

The consolidated problem statements are available to reference on the GHG Coordination working group webpage. The ISO is dedicated to addressing each problem statement, but will use the top listed problem statements to indicate near term priorities for assessment and further discussion if necessary.

PacifiCorp’s ranks the following problem statements from highest priority to lowest priority for discussion: 

1. There is not a market mechanism in states with a declining cap on emissions.
2. The ISO doesn’t provide all metrics desired by market participants. 
3. When there are multiple unlinked regulation areas or different reporting requirements by different states, market participation may result in double counting, undercounting, or inconsistent counting of emissions. 
4. The current GHG design doesn’t limit attribution to only capacity above the baseline which results in the potential for secondary dispatch. 
5. Attribution is not scale-able because it creates the potential for secondary dispatch. This secondary dispatch could increase with market expansion. 
6. The optimization doesn’t take the explicit cost of secondary dispatch into account, and therefore may not balance optimized attribution with constraints to limit secondary dispatch. 

7. Additional comments:

No additional comments.

1. Provide a summary of your organization’s comments on the November 27, 2023 GHG Coordination working group discussion:

PGE appreciated CAISO’s presentation on a potential average emissions rate. This discussion of GHG metrics and potential metrics helped move the conversation forward toward improved data availability about the GHG emissions from market imports.

2. Provide your organization’s comments on the current and proposed GHG metrics published by the CAISO:

PGE supports CAISO providing data on GHG emissions associated with power transacted in the WEIM, including through an average emissions rate similar to that described by CAISO in the November 27 GHG working group. While there are more detailed discussions needed on the design and use of the metric, PGE finds the AER discussed at the workshop to be a promising metric design.  As discussed in the workshop, it may be useful for CAISO to produce several different metrics, such as for different time scales (PGE is particularly interested in hourly data that can be easily aggregated for an annual regulatory report).

3. Provide your organization’s comments on the consolidated problem statements:

The consolidated problem statements are available to reference on the GHG Coordination working group webpage.

PGE agrees with the discussion in the workshop that the problem statements should be further consolidated to focus the discussion.

4. Provide any questions you have on the current GHG design that you would like the ISO to answer:

No specific questions

5. Please list the following topic areas in order of highest priority for discussion to lowest priority for discussion – Market Operations and GHG Design, State Coordination, Emissions Tracking and Accounting, Beyond GHG Price-based Policy:

PGE believes the top priorities should be improving and expanding the data published by CAISO about the GHG emissions associated with market power, and working toward a mechanism that allows for entities in states with a declining cap on emissions (but no price) to ensure load is served by generation that meets the state’s targets. Improving market emissions data should be first priority because it will support several of the other issues for discussion.

1. Emissions Tracking and Accounting.
2. Beyond GHG Price-based Policy
3. Secondary Dispatch, Market Operations and GHG design
4. State Coordination

6. Please list the consolidated problem statements (PS 1-6) in order of highest priority for discussion to lowest priority for discussion.

The consolidated problem statements are available to reference on the GHG Coordination working group webpage. The ISO is dedicated to addressing each problem statement, but will use the top listed problem statements to indicate near term priorities for assessment and further discussion if necessary.

PS 5 Emissions Accounting and Reporting

PS 6 Beyond Price-based GHG policy

PS 1/2/3 Secondary Dispatch / Market Operations and GHG Design

PS 4 State coordination

7. Additional comments:

1. Provide a summary of your organization’s comments on the November 27, 2023 GHG Coordination working group discussion:

PSE supports the CAISO’s efforts to improve the WEIM and EDAM greenhouse gas accounting structures. In particular, PSE encourages the CAISO to seek solutions that will be durable in the rapidly changing regional environment. Changes to the existing structure should seek to meet the needs of a variety of participating entities facing increasing levels of carbon regulation. PSE views the development of this accounting and reporting as an iterative process. The data being considered may initially be used for informational purposes only but with an eye toward serving various compliance needs as more becomes known and methodologies improve.

As an initial matter, GHG metrics currently published by the CAISO would be improved by increasing access to historical figures. Daily Outlook and GHG report data should be warehoused and accessible to interested stakeholders to bulk download in CSV or Excel format for the purposes of evaluating various slices of time.

2. Provide your organization’s comments on the current and proposed GHG metrics published by the CAISO:

CAISO’s Daily Outlook serves the purpose of providing an informational view of the trend of emissions attributed to serve CAISO demand in the daily market. The data is downloadable in Excel format, uses five-minute metered data, and is available at the CAISO BAA level.  The basis of these inputs could be an important base set of data for calculation of average emissions factors and residual emissions factors as discussed in the GHG Coordination Working Group. But this report has some limitations for compliance purposes:

• Utilizes generic emissions factors based on fuel-type versus resource-specific factors. To utilize this data beyond the Daily Outlook, resource-specific factors should be used, where known or available. Further discussion is needed on how to determine factors for unknown or unregistered resources. 
• Assigns 0.428 mtCO2e/MWh emissions factor to imports. At least in the case of WEIM, attributions to the CAISO are resource-specific. Resource-specific factors should be used, where known or available. Further discussion is needed on how to determine factors for imports of an unknown source.
• Requires sufficient locational granularity to be useful for compliance purposes. Stakeholder discussion is needed about the appropriate level of locational granularity to be made available publicly versus confidentially.

CAISO’s Emissions Tracking Report serves the purpose of providing an informational view of the trend of emissions attributed to serve CAISO demand in a given month. The data is available in PDF format, uses five-minute market awards data, utilizes resource-specific emissions factors (where known), and is available at the CAISO BAA level.  This report has some limitations for compliance purposes:

• Report has a lag of more than one month.
• Data is available at the monthly level only.
• Due to a limitation in CAISO dispatch accounting, this report assigns 0.428 mtCO2e/MWh emissions factor to all imports, including WEIM transfers. At least in the case of WEIM, attributions to the CAISO are resource-specific. Resource-specific factors should be used, where known or available. Further discussion is needed on how to determine factors for imports of an unknown source.
• Requires sufficient locational granularity to be useful for compliance purposes. Stakeholder discussion is needed about the appropriate level of locational granularity to be made available publicly versus confidentially.

Does not reflect GHG emissions associated with exports and EIM transfers out of the ISO that are serving load outside of the ISO. PSE supports further exploration by CAISO and stakeholders of an average emissions rate for various segments of the market and supports WPTF’s proposed definition of an average emissions rate with a few minor edits:

The average emissions rate is the generation-weighted average emission rate of energy from dispatched resources located registered outside the GHG pricing area that is are not attributed to the GHG pricing areas, or otherwise claimed by other market participants or other external entities.

With respect to the treatment of demand response and storage resources, PSE suggests the following as a starting point for discussion:

• Demand response should be considered as a reduction of load rather than a supply resource – positive energy schedules associated with demand response should be removed from the Energy Output variable in calculations to most accurately convey the emissions rate of generating supply resources. Considering demand response as a supply resource may have the effect of lowering the AER by treating it similarly to a zero emissions generator.
• Energy storage resources have no overall impact to the volume of emissions associated with serving load, but rather, they change the interval with which the emissions are associated. Their primary impact is through the displacement of supply to serve load from one interval to another. Energy storage resource schedules, positive and negative, should be excluded from AER calculations to prevent underestimation of the AER due to the variable charge and discharge schedules associated with battery efficiency losses. This approach will associate the emissions of charging the battery with the interval in which it charges, rather than the interval in which it serves load.

Additionally, it will be important for the CAISO’s reporting to have the ability to carve out attributed megawatt-hours and emissions that make up those segments to arrive at a residual emissions factor that reflects what is “left over” in non-GHG zones. PSE appreciates the information and technical detail shared by CAISO at the November 27 meeting around the treatment of demand response resource and storage, and recognizes there may be additional considerations around various slices of time and the sources of available data in those increments. PSE also supports the exploration of a marginal emissions rate but believes considerable discussion is needed before attempting to define a marginal emissions rate.

3. Provide your organization’s comments on the consolidated problem statements:

The consolidated problem statements are available to reference on the GHG Coordination working group webpage.

NA

4. Provide any questions you have on the current GHG design that you would like the ISO to answer:

NA

5. Please list the following topic areas in order of highest priority for discussion to lowest priority for discussion – Market Operations and GHG Design, State Coordination, Emissions Tracking and Accounting, Beyond GHG Price-based Policy:

1. Emissions Tracking and Accounting
2. Market Operations and GHG Design
3. State Coordination
4. Beyond GHG Price-Based Policy

PSE is particularly interested in discussion around how resource attribution will perform in a market with two carbon-regulated states.  

6. Please list the consolidated problem statements (PS 1-6) in order of highest priority for discussion to lowest priority for discussion.

The consolidated problem statements are available to reference on the GHG Coordination working group webpage. The ISO is dedicated to addressing each problem statement, but will use the top listed problem statements to indicate near term priorities for assessment and further discussion if necessary.

1. When there are multiple unlinked GHG regulation areas or different reporting requirements by different states, market participation may result in double counting, undercounting, or inconsistent counting of emissions.
2. The optimization does not take the explicit cost of secondary dispatch into account, and therefore may not balance optimized attribution with constraints to limit secondary dispatch.
3. The current GHG design does not limit attribution to only capacity above the baseline which results in the potential for secondary dispatch.
4. Attribution is not scale-able because it creates the potential for secondary dispatch. This secondary dispatch could increase with market expansion.
5. The ISO does not provide all metrics desired by market participants.
6. The market does not address states with non-priced emissions programs with a declining cap on emissions.

7. Additional comments:

NA

1. Provide a summary of your organization’s comments on the November 27, 2023 GHG Coordination working group discussion:

The Salt River Project Agricultural Improvement and Power District (SRP) appreciates the comprehensive discussions during the November 27 GHG Coordination Working Group (WG) meeting. The presentations by all participants, including PacifiCorp's insights into multijurisdictional utility complexities, Oregon DEQ’s detailed overview of GHG reporting requirements, and the informative contributions by the CAISO, were appreciated. The session provided perspectives on multi-state compliance challenges, emissions tracking intricacies, and the complexities of coordination across different jurisdictions. SRP encourages continued WG discussions in an effort to identify and prioritize problem statements that will aid in the advancement of GHG coordination efforts across multiple footprints.

2. Provide your organization’s comments on the current and proposed GHG metrics published by the CAISO:

SRP strongly supports additional GHG reporting metrics to better characterize GHG related to market transfers. To better understand the options for reporting metrics, SRP requests further clarity on the reporting methodology of the proposed metrics and examples illustrating the reporting of emission rates. Specifically, SRP seeks clarification on how the emission rate would be reported using all resources as opposed to solely using resource schedules relative to the base schedule, with or without bilateral transactions. This clarity and examples may potentially aid in understanding the nuances of emissions calculation methodologies.

Additionally, SRP requests detailed insights into how the energy storage resource emission rates are intended to be accounted for within the proposed metrics. Understanding the inclusion of these factors is crucial for a comprehensive assessment of emissions across varied resource types.

Furthermore, SRP values transparency in emissions reporting and encourages CAISO to offer insights into the granularity of emissions reporting. Clarity on how these proposed metrics align with reporting frameworks adhered to by utilities would facilitate their integration and utilization within existing operational assessments. The frameworks pertinent to SRP's carbon accounting practices are World Resource Institute’s (WRI) Greenhouse Gas Protocol and The Climate Registry's Electric Power Sector Protocol, and with regard to customer renewable energy allocations, the RE 100 Technical Criteria and the Center for Resource Solutions' Accounting for Standard Delivery Renewable Energy, among others. In conclusion, SRP appreciates CAISO’s efforts to enhance GHG reporting metrics and seeks further clarification to ensure the effective integration of these metrics into utility reporting frameworks.

3. Provide your organization’s comments on the consolidated problem statements:

The consolidated problem statements are available to reference on the GHG Coordination working group webpage.

SRP appreciates CAISO’s effort to consolidate problem statements and the clarity provided in the revised statements. In reviewing the consolidated problem statements, SRP supports the consolidation and revision made to problem statements 5 and 6 which focuses on broadening the perspective on emission reduction targets. However, these statements consider only state mandated caps, overlooking corporate sustainability objectives that may or may not be the same as state programs. SRP emphasizes the importance of considering corporate emission reduction goals alongside state-mandated caps for a more comprehensive approach to emission tracking and compliance.  Additionally, SRP recommends the CAISO incorporate additional metrics that would enable better tracking of emissions due to market transfers to meet these goals. SRP advocates for the establishment of a market mechanism that aligns with corporate emission reduction goals, similar to those applied to state mandated caps that will provide a consistent framework for GHG management across varied objectives. Further refinement of these statements to encompass diverse emission reduction objectives, including corporate goal, will potentially facilitate a better understanding.

4. Provide any questions you have on the current GHG design that you would like the ISO to answer:

SRP appreciates the CAISO's focus on addressing critical inquiries brought up during the GHG Coordination WG session. The questions presented in the meeting identified as areas of further exploration align with SRP’s interest for more insights into the current EDAM and WEIM GHG design and will be important for refining future problem statements.

5. Please list the following topic areas in order of highest priority for discussion to lowest priority for discussion – Market Operations and GHG Design, State Coordination, Emissions Tracking and Accounting, Beyond GHG Price-based Policy:

SRP prioritizes the topic areas as follows:

1. Emissions Tracking and Accounting
2. Market Operations and GHG Design
3. Beyond GHG Price-based Policy
4. State Coordination

6. Please list the consolidated problem statements (PS 1-6) in order of highest priority for discussion to lowest priority for discussion.

The consolidated problem statements are available to reference on the GHG Coordination working group webpage. The ISO is dedicated to addressing each problem statement, but will use the top listed problem statements to indicate near term priorities for assessment and further discussion if necessary.

SRP prioritizes the problem statements as follows:

1. Problem Statement 5 - The ISO does not provide all metrics desired by market participants.
2. Problem Statement 1 - The optimization does not take the explicit cost of secondary dispatch into account, and therefore may not balance optimized attribution with constraints to limit secondary dispatch.
3. Problem Statement 2 - The current GHG design does not limit attribution to only capacity above the baseline which results in the potential for secondary dispatch.
4. Problem Statement 3 - Attribution is not scale-able because it creates the potential for secondary dispatch. This secondary dispatch could increase with market expansion.
5. Problem Statement 4 - When there are multiple unlinked GHG regulation areas or different reporting requirements by different states, market participation may result in double counting,
6. Problem Statement 6 - There is not a market mechanism in states with a declining cap on emissions.

7. Additional comments:

No additional comments at this time.

1. Provide a summary of your organization’s comments on the November 27, 2023 GHG Coordination working group discussion:

The working group session on November 27 was productive and informative.  SCE appreciates both the Oregon DEQ and Pacificorp for presenting and providing further insight into the complexities of GHG accounting in a regional market.  The opportunity to hear from different types of stakeholders furthers these efforts because the issues around GHG are so broad.

2. Provide your organization’s comments on the current and proposed GHG metrics published by the CAISO:

SCE appreciates CAISO’s laying out of the structure of existing GHG emissions metrics both public and non-public.  For the public metrics, it would be helpful if CAISO could lay out why it publishes the metrics, i.e., who is the target user for this data and how does CAISO believe this information is being utilized.  The CAISO and stakeholders are not aligned on what data is needed and why, so a further understanding of the perceived purpose (to the extent not intuitive) of the existing set of metrics could help align and prioritize the goals and objectives of changes to GHG metrics.  It would be helpful to differentiate the various drivers of existing metrics, e.g., regulatory, corporate reporting, cost derivation, nice to know.

The introduction of the Average Emissions Rate as a future metric is interesting if a bit confusing as to CASIO’s beliefs of how the metric could or should be used.  SCE understands that CAISO indicated that the working group process would develop and drive use cases and potential refinements but it would be helpful to get a better understanding of why CAISO proposed this specific metric.

Additionally, SCE encourages the CAISO to contemplate what information is available about marginal emitting units and how that data could be provided and utilized.

Overall, while SCE encourages as much transparency as possible when it comes to available data pertaining to GHG (and other data, too), SCE believes that an agreed upon framework for evaluating current and proposed GHG metrics will be a useful tool to furthering this discussion and that aligning on this framework should be a priority item for discussion at the next GHG working group meeting.  With a more robust framework, the evaluation of current and potential metrics could be pursued in a more efficient manner, such that the working group focuses on priority metrics rather than on all possible metrics and data points.

3. Provide your organization’s comments on the consolidated problem statements:

The consolidated problem statements are available to reference on the GHG Coordination working group webpage.

SCE appreciates the CAISO starting the conversation about the consolidated problem statements with an alignment on definitions of key aspects.  It could be helpful for the CAISO to provide a more detailed example of secondary dispatch in WEIM and how that may (or may not) change in EDAM.        

SCE encourages the continued prioritization and refinement of these problem statements.  Though it may be contrary to how problem statements are typically pursued, SCE suggests that maybe there could be a stakeholder “sponsor” for each of the problem statements.  This additional co-ownership should help any discussion about specific problem statements to be a bit more efficient.

4. Provide any questions you have on the current GHG design that you would like the ISO to answer:

SCE has no comment

5. Please list the following topic areas in order of highest priority for discussion to lowest priority for discussion – Market Operations and GHG Design, State Coordination, Emissions Tracking and Accounting, Beyond GHG Price-based Policy:

State Coordination

Beyond GHG Price-base Policy

Current - Market Operations and GHG Design

Current - Emission Tracking and Accounting

Future - Market Operations and GHG Design

Future - Emission Tracking and Accounting

It is key that policy alignment reflecting regulatory needs be achieved before evaluating whether the current design and market operations are sufficient or require modifications.  Any emissions tracking and accounting should be driven by policy and then reflected in the design of the market.

6. Please list the consolidated problem statements (PS 1-6) in order of highest priority for discussion to lowest priority for discussion.

The consolidated problem statements are available to reference on the GHG Coordination working group webpage. The ISO is dedicated to addressing each problem statement, but will use the top listed problem statements to indicate near term priorities for assessment and further discussion if necessary.

SCE believes that policy, to the extent to which there is not alignment, should be prioritized for discussion.  This should then support the understanding and evaluation of current market ops and design as well as any accounting and tracking problem statements.  

7. Additional comments:

SCE has no additional comments

1. Provide a summary of your organization’s comments on the November 27, 2023 GHG Coordination working group discussion:

In the Six Cities’ view, the consolidation of problem statements as presented at the November 27, 2023 working group meeting represents a step forward.  However, the consolidated problem statements continue to co-mingle issues or concerns that relate to current operation of the Western Energy Imbalance Market (“WEIM”) and essentially speculative concerns about how implementation of the Extended Day-Ahead Market (“EDAM”) over an as-yet undefined footprint might affect Greenhouse Gas coordination.  As discussed in Item 7 below, the Six Cities reiterate (in updated form) the recommendation previously submitted in their November 7, 2023 comments that the next steps in the GHG Coordination working group process include: (1) distinguishing between those problem statements that address current market operations and those that relate to future operations under the EDAM design and deferring further consideration of the latter, and (2) only for those consolidated problem statements that identify concerns under current market operations, identifying data available to analyze the scope of the problem and potential solutions under current market operations.

2. Provide your organization’s comments on the current and proposed GHG metrics published by the CAISO:

As described in the CAISO’s presentation at the November 27^th working group meeting, the CAISO already provides a variety of information and metrics relating to GHG accounting and the impacts on GHG emissions of operations under the WEIM.  The Six Cities do not have any recommendations at this time with regard to specific data collection for assessment of problem statements relating to WEIM operations, and stakeholders that propose problem statements relating to WEIM operations are in the best position to identify data that would support evaluation of such problem statements and potential solutions.  To the extent problem statements focus on potential concerns with GHG accounting, coordination, or impacts under the EDAM design, the Six Cities recommend deferring further consideration of such problem statements until the EDAM has been operating for a reasonable period of time (e.g., one year following implementation of the EDAM).

3. Provide your organization’s comments on the consolidated problem statements:

The consolidated problem statements are available to reference on the GHG Coordination working group webpage.

As noted above, the consolidated problem statements do not clearly identify whether they relate to current operations under the WEIM, anticipated operations under the EDAM, or both.  They should be supplemented to distinguish between current and future operations. 

4. Provide any questions you have on the current GHG design that you would like the ISO to answer:

At this time, the Six Cities do not have any questions they would like the CAISO to answer regarding the current GHG design.

5. Please list the following topic areas in order of highest priority for discussion to lowest priority for discussion – Market Operations and GHG Design, State Coordination, Emissions Tracking and Accounting, Beyond GHG Price-based Policy:

The Six Cities prioritize the topic areas as follows, to the extent they relate to concerns involving current operations under the WEIM:

1. State Coordination
2. Emissions Tracking and Accounting
3. Market Operations and GHG Design
4. Beyond GHG Price-based Policy

6. Please list the consolidated problem statements (PS 1-6) in order of highest priority for discussion to lowest priority for discussion.

The consolidated problem statements are available to reference on the GHG Coordination working group webpage. The ISO is dedicated to addressing each problem statement, but will use the top listed problem statements to indicate near term priorities for assessment and further discussion if necessary.

The Six Cities prioritize evaluation of the consolidated problem statements in the following order, to the extent they relate to concerns involving current operations under the WEIM:

Problem Statement 4

Problem Statement 1

Problem Statement 2

The Six Cities recommend deferring consideration of Problem Statements 3 and 6 at this time and refining or eliminating Problem Statement 5.

7. Additional comments:

As summarized above, the Six Cities recommend that this working group process focus on problem statements that identify concerns with the CAISO’s markets as they currently operate.  It is premature and an inefficient use of CAISO and stakeholder resources to attempt to predict how well the EDAM design will or will not properly account for GHG impacts.  In addition, issues that may have insignificant effects given the limitation of the WEIM to imbalance energy volumes may have greater impacts in the context of the EDAM, or, conversely, modifications to be implemented with the EDAM design may resolve or reduce effects currently observed in the WEIM.  Subsequent working group sessions should distinguish between those problem statements that address current market operations and those that relate to future operations under the EDAM, identify data available to analyze the scope of the problem and potential solutions under current market operations, and defer consideration of concerns that may or may not arise under EDAM operations.

1. Provide a summary of your organization’s comments on the November 27, 2023 GHG Coordination working group discussion:

WRA appreciates the presentations from CAISO, ODEQ, and PacifiCorp. WRA is eager to continue the discussion about GHG metrics as it pertains to tracking and accounting that meets the needs of market participants, regulators, customers, and other stakeholders.

2. Provide your organization’s comments on the current and proposed GHG metrics published by the CAISO:

WRA appreciates the information provided about developing an average emissions rate (AER) metric and looks forward to continuing this discussion in future work group meetings. In general, WRA is interested in discussing the feasibility, frequency, and granularity of 1) market total average emissions, 2) market average marginal emissions, 3) market residual emissions, and 4) total emissions by jurisdiction. WRA will provide more in-depth analysis and recommendations on reporting metrics in January 2024.

3. Provide your organization’s comments on the consolidated problem statements:

The consolidated problem statements are available to reference on the GHG Coordination working group webpage.

N/A

4. Provide any questions you have on the current GHG design that you would like the ISO to answer:

N/A

5. Please list the following topic areas in order of highest priority for discussion to lowest priority for discussion – Market Operations and GHG Design, State Coordination, Emissions Tracking and Accounting, Beyond GHG Price-based Policy:

1. Beyond GHG Price-based Policy
2. Emissions Tracking and Accounting
3. State Coordination
4. Market Operations and GHG Design

6. Please list the consolidated problem statements (PS 1-6) in order of highest priority for discussion to lowest priority for discussion.

The consolidated problem statements are available to reference on the GHG Coordination working group webpage. The ISO is dedicated to addressing each problem statement, but will use the top listed problem statements to indicate near term priorities for assessment and further discussion if necessary.

6. There is not a market mechanism in states with a declining cap on emissions for...

5. The ISO does not provide all metrics desired by market participants...

4. When there are multiple unlinked GHG regulation areas or different reporting requirements by different states, market participation may result in double counting, undercounting, or inconsistent counting of emissions.....

3. Attribution is not scale-able because it creates the potential for secondary dispatch. This secondary dispatch could increase with market expansion...

1. The optimization does not take the explicit cost of secondary dispatch into account, and therefore may not balance optimized attribution with constraints to limit secondary dispatch...

2. The current GHG design does not limit attribution to only capacity above the baseline which results in the potential for secondary dispatch...

7. Additional comments:

N/A

1. Provide a summary of your organization’s comments on the November 27, 2023 GHG Coordination working group discussion:

WPTF appreciates the opportunity to provide these comments on the CAISO’s Nov 27 GHG Coordination working group discussions. As we move meeting to meeting, the conversations of this topic is evolving and moving the effort in a positive direction. At this point, WPTF believes it would be most beneficial to try and combine/condense the problem statements into a few concise and well-articulated problem statements for ease of scoping the policy discussions. As discussed in more detail below, several of the problem statements seem to be trying to capture the same issue, thus would be most efficient to combine where able.

2. Provide your organization’s comments on the current and proposed GHG metrics published by the CAISO:

WPTF supports providing additional data and metrics regarding GHG. As evident from the discussion, there are several different ways one could slice and dice the data. For example, we would see benefit in calculating separate average emission rate metrics for a) resources within each of the GHG pricing area, b) for resources deemed to the GHG pricing area, and c) for the market footprint as a whole. To maximize the value of this information for regulators, market participants and the public more generally, consideration is needed of the appropriate granularity for calculation and publication of this data, such as hourly, daily, seasonally and annually. We think it would be useful to fold into this discussion how the data is going to be used to help narrow in on the most informative way to present the data. For example, if the average emissions rate is going to be used for compliance reporting purposes, then granularity must align with that required by the relevant regulations, e.g. hourly.

Additionally, WPTF recommends that the CAISO should calculate and publish a residual market emission factor. This would represent the generation-weighted average emission rate of energy from dispatched resources located outside the GHG pricing area that is not attributed to the GHG pricing areas, or otherwise claimed by other market participants. The CAISO could also consider developing an accounting mechanism to enable load-serving entities outside of the GHG pricing areas to ‘claim’ energy from resources dedicated to serve the entities own load. This accounting mechanism would enable calculation of a residual market emission rate by removing emissions and MWh associated with energy from dedicated resources, as well as deemed energy. The residual emission factor should be calculated and published on the same granularity and frequency as average emission factors.

With respect to CAISO’s implied question on inclusion of storage resources in the calculation of GHG metrics, WPTF would appreciate clarification that when the CAISO says it could exclude storage resources from the calculation, it is saying when aggregating the total supply of energy during a given time period it would not include energy discharged from storage resources. Additionally, if that is the case, then we think it makes sense to also discuss how to treat the supply of energy used to charge the storage resources in the same metric calculation. For example, if the CAISO is going to calculate the metric using dispatch instructions, then it could be the case that by excluding storage discharge from the calculation will overstate the average emission rate in hours of discharge as well as in hours of charging since the energy dispatched from all resources (including those used to charge the storage) is included in the calculation. Alternatively, if the CAISO plans to use metered data to the grid, then there would need to be a way to distinguish between energy put on the grid from a storage resource versus a non-storage resource where both are behind the same meter.

Clarification of these matters would be important before determining whether charging and discharging of storage resources is included in any particular GHG metric (e.g. grid average, deemed average, residual average). Generally speaking, WPTF can see why it may make sense to exclude storage resources from the calculation since they are a non-emitting resource and do not necessarily “generate” energy in the traditional sense but rather shift energy from being generated in one interval to another. However, at the same time, these resources are an integral part of the ability for CA (and we suspect other states with clean energy and GHG goals) to meet renewable and GHG state policies. Simply excluding them all together may not truly capture the overall GHG emissions in a way that we can assess the overall reduction in GHG emission. Here again, providing the average emissions rate metric under different variations (with and without storage resources) may be most informative rather than solely reporting a metric that does not include storage resources.

Lastly, WPTF also suggests publication of marginal emission factors for 1) resources located within or deemed to the GHG pricing areas and 2) the market footprint as a whole.  While consideration is needed as to how to define marginal emission factors, WPTF considers that it should be based on the emission factor of the highest energy offer dispatched emitting resource.

3. Provide your organization’s comments on the consolidated problem statements:

The consolidated problem statements are available to reference on the GHG Coordination working group webpage.

WPTF recommends the CAISO consider a way to combine the first two problem statements under Market Operations and GHG design or consider having the first problem statement be a sub-issue of the second. For example, the CAISO could consider the following problem statement and sub-issue:

The current GHG design does not limit attribution to only dispatched generation above the baseline which results in the potential for secondary dispatch and inaccurate price signals.

Sub-Issue: Because the optimization does not see the full cost of GHG associated with secondary dispatch, there may not be an appropriate market design balance between limiting attribution and allowing for secondary dispatch.

Along the same lines, WPTF also recommends the CAISO combine problem statements 6-8 as identified in the presentation. The CAISO could consider rephrasing as follows:

There is not a mechanism for entities in states with a declining cap on emissions to ensure load is served by generation that meets the state’s targets and for generation to be offered to serve load in the states with such declining caps.

Sub-Issue: Because there is not a current mechanism to reflect states with declining caps on emissions, there is an inability for states with both a carbon price policy and declining cap on emissions to reflect both requirements in the market.

Lastly, the Oct 19 and Oct 30 working group discussions walked through 15 problem statements that have now been revised and condensed. However, WPTF has noticed that Problem Statement #4 in the Oct 19 presentation related to price formation and transparency was omitted from the list of problem statements in the Nov 27 working group meeting.[1] Accurate price formation and transparency are fundamental elements to running a competitive wholesale market. Entities rely on the accuracy and transparency of not only the overall energy prices but also the underlying components (e.g., GHG component of the LMP) when making long term investment and business decisions that directly impact the market. It is absolutely imperative that we as a group ensure the prices, including the price components, coming out of the market optimization are as accurate and transparent as possible. Thus, we respectfully request that the CAISO re-introduce this problem statement into the working group discussions.

[1] “The current price formation does not provide full transparency into the total marginal GHG cost, leading to inaccurate price signals and reduced price transparency.”  

4. Provide any questions you have on the current GHG design that you would like the ISO to answer:

No comment.

5. Please list the following topic areas in order of highest priority for discussion to lowest priority for discussion – Market Operations and GHG Design, State Coordination, Emissions Tracking and Accounting, Beyond GHG Price-based Policy:

WPTF believes that of highest priority are two topic areas - Market Operations and GHG design and Emissions Tracking and Accounting. The reason they should be linked in terms of priority is because in order to make well-informed decisions about the market operations and GHG design, we need to have the ability to first evaluate the data and have access to metrics. Following those two topic areas, WPTF believes the next priority should be state coordination and then beyond GHG price-based policy. 

6. Please list the consolidated problem statements (PS 1-6) in order of highest priority for discussion to lowest priority for discussion.

The consolidated problem statements are available to reference on the GHG Coordination working group webpage. The ISO is dedicated to addressing each problem statement, but will use the top listed problem statements to indicate near term priorities for assessment and further discussion if necessary.

WPTF believes the following priority order of problem statements achieves an appropriate balance and flow in discussion:

1. PS 1 and 2 as a combined problem statement as suggested in response to question #3
2. WPTF added PS as suggested in response to question #3
3. PS 5
4. PS 4
5. PS 3 (although note that this could be considered a sub-issue of #1)
6. PS 6

7. Additional comments: