CAISO avoiding fix to massive market distortion that harms local renewables and California ratepayers

The Clean Coalition's Katie Ramsey presented at this webinar, which took place on December 1, 2016.

This Transmission Access Charges (TAC) Campaign webinar exposed how transmission costs in California are erroneously allocated to local energy sources that do not require use of the transmission grid while resulting in a massive market distortion that harms ratepayers, hinders local and state energy goals, and minimizes local economic development opportunities. In addition, the webinar summarized how the California Independent System Operator (CAISO) failed to address this issue on a timely basis, and provided recommendations for a straightforward fix that could be implemented without delay and in a manner that reduces the substantial risks associated with CAISO expansion into a regionalized Independent System Operator. Overall, the webinar explored how a simple fix to the TAC market distortion will significantly benefit local renewables, ratepayers, and the environment — and will maximize California’s control of its future.

TAC are designed to be per kilowatt-hour (kWh) fees for using California’s transmission system and TAC add about 3 cents per kWh to the levelized cost of energy over a 20-year contract. Importantly, the TAC distortion is massive, because 3 cents per kWh is roughly 30% of the wholesale value of energy in California.

The Clean Coalition — along with 60 supporting organizations — demanded that CAISO correct the TAC market distortion without delay.

The webinar discussed the following:

  • An overview of the TAC distortion, its simple fix, and how CAISO failed to pursue the fix on a timely basis.
  • Why the TAC issue needs to be resolved prior to serious consideration of CAISO’s proposal to expand its balancing authority and dilute California’s governance over CAISO.
  • How the TAC fix can be extended to CAISO’s proposed regionalization in a manner that protects ratepayers and retains strong levels of state governance.
  • How all parties, from Load Serving Entities like utilities and Community Choice Aggregators to energy producers and ratepayers, benefit from the TAC fix.
  • How the TAC fix aligns with other California energy policies, including renewable portfolio standards, distribution resources planning, integrated resources planning, and Zero Net Energy buildings and communities.
  • The Clean Coalition’s next steps and how to get involved.

The prior TAC Campaign webinar dissected the economic, environmental, and societal benefits of the TAC fix and featured speakers from UCLA, SolarCity, and the Sierra Club. The webinar concluded how a TAC fix represents the biggest opportunity for ensuring that fair and accurate value will be provided to local renewables and other distributed energy resources.

More information on the TAC Campaign:

Watch the webinar here.

Slides are available in PDF and PPT format.