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CAISO Reliability is Feeling the Heat

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In a recent heat wave, CAISO’s demand reached 7.5% above forecasted annual peak and prices climbed as high as $750/MWh. That demand led CAISO to send out conservation alerts into the night. Hot weather is only part of the story. California is attempting to integrate a record amount of renewables and additional work is needed to reliably achieve energy and environmental goals. For example, in 2017 California overstates the reliability contribution of solar by 100% or more, and underestimates the variability of supply and demand. The emerging misalignment of solar generation and system peak in California could open new opportunities for thermal and storage assets that provide reliability services during peak periods.