Resource Adequacy
Regionalization Initiative



In 2015, the governor signed into law SB 350, which directs state agencies to consider the expansion of the California Independent System Operator (CAISO) into a regional organization. CAISO is responsible for developing a regional energy market to better use resources, especially renewables and to reduce greenhouse gas emissions and costs. If CAISO expands, Resource Adequacy rules will need to change to address a regional market. 

 CAISO is leading a stakeholder initiative to address resource adequacy issues, as part of implementing SB 350. Stakeholders are submitting feedback through the CAISO Process.  ORA comments focus on ratepayer concerns over grid reliability, maintaining a voice for individual states and ratepayers in a regional entity, and creating a level playing field. 

 On May 26, 2016, CAISO issued its Second Revised Straw Proposal on Regional RA, which creates a regional framework that addresses multi-state issues, such as load forecasting, importing capabilities and allocation of RA requirements for load serving entities.    

CAISO plans to present a Resource Adequacy proposal to its board no earlier than October 2016. After approval, the CAISO would request approval with the Federal Energy Regulatory Commission. 



ORA Position  

ORA supports the CAISO initiative to consider Resource Adequacy’s (RA) role in a multi-state expansion.  The current Resource Adequacy rules are specific to California and must be adjusted to accommodate use in a multi-state entity.    

ORA supports a regional Resource Adequacy approach that increases  reliability, promotes increased renewable resource integration and can reduce ratepayer costs.    

 ORA recommends that the CAISO should use:  

  • Consistent load forecasting and resource counting methodologies to prevent inequitable Resource Adequacy requirements.  
  • An independent entity to develop and maintain oversight of Resource Adequacy rules to promote   consistent methodologies through a consensus sensitive to state issues like Demand Response and Energy Efficiency, while recognizing the need for regional consistency. 
  • Modeling for the planning reserve margin (PRM) that includes metrics to determine the costs and benefits of varying reliability levels, that will measure the value of reliability but protect ratepayers from higher than necessary PRM costs. 


See ORA’s:  

July 12, 2016 Comments to the CAISO on Load Forecasting.

June 15, 2016 Comments to the CAISO on CAISO’s Second Revised Straw Proposal. 




CAISO Initiative Process 

See the CAISO Initiative process. 





CAISO Stakeholder Regionalization Initiatives Webpage