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Blackouts renew criticism of Cal ISO system

California is the only western state with an ISO
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Posted at 3:58 PM, Aug 18, 2020
and last updated 2020-08-18 18:58:52-04

SAN DIEGO (KGTV) — As California deals with its worst energy crisis in two decades and the threat of more rolling blackouts, a lot of people are wondering who -- or what -- is to blame.

Energy experts say last weekend’s blackouts are raising new questions about the way the state manages its electrical grid. California is the only state in the west that uses an independent system operator, an entity known as Cal ISO.

“This is really just a demonstration that the reliability of the grid is less reliable with [Cal ISO] than when we just had regular utilities,” said San Diego-based energy consultant Bill Powers.

Cal ISO manages 80 percent of California’s power grid. It manages the flow of electricity for investor-owned utilities like an air traffic controller manages the flow of privately owned airplanes down a runway. City-owned utilities like the Los Angeles Department of Water and Power are not part of the Cal ISO system.

Cal ISO, previously known as CAISO, was formed in 1998 after regulatory changes during the Clinton administration that were designed to make the energy market more competitive.

Powers said the fundamental idea was simple: “instead of having these monopoly utilities controlling everything, let's open up the transmission systems.”

But it didn’t take long for flaws in the system to emerge. In 2001, market manipulation from companies like Enron prompted dozens of rolling blackouts.

In other states like Arizona, utilities are responsible for the electrical transmission within their service territory. Those utilities are able to rapidly respond if conditions prompt the need for additional power generation, Powers said.

“[It’s] one-stop shopping. Here it’s two-stop shopping,” he said. “You've got another layer of fat in there. And if that layer of fat is playing the game a different way, simply making sure everyone is covered, then you have the potential to have a breakdown. And we're now experiencing a breakdown.”

The most recent major breakdown was in 2011, when 1.4 million San Diegans suddenly found themselves in the dark.

A federal investigation into the Great Blackout of 2011 cited “inadequate real-time situational awareness” -- basically bad grid management -- and faulted several entities, including Cal ISO.

Edward Lopez, the executive director of the Utility Consumers’ Action Network, said last weekend’s rolling blackouts were another example of bad grid management.

“This is an indication that, again, this statewide organization needs to be better prepared and ready to jump into action quicker,” he said.
Cal ISO blames another state agency for the recent rolling blackouts, the California Public Utilities Commission, along with California’s evolving energy portfolio.

About one-third of the energy California now generates in-state is from renewable sources like solar and wind. When clouds roll in and the winds subside, that can be a problem.

“Lack of resources, the heat, those go into account,” Lopez said, “but on the other hand, this was not unpredictable.”

Even though more Californians have been staying home due to the pandemic, last weekend’s conditions were not particularly remarkable, he said. With the impact of climate change, above normal temperatures are expected to become more common.

One solution to California’s renewable energy problem, he said, is to invest in more energy storage.

Cal ISO’s own data shows energy demand last weekend was lower than in previous peak years and there were reserves available, Powers said.

“Why do we keep reserves if we’re not willing to use those reserves when conditions get tight?” Powers said.

City-owned utilities like LADWP that are independent from Cal ISO did not experience rolling blackouts, one reason Powers thinks there’s a problem with California’s energy air traffic controller.

“Maybe we need better rules. Maybe we need a different system,” he said.