In 2016, Brattle experts led a team of multiple consulting companies to help California ISO evaluate ISO regionalization and transitioning the Western Interconnection into a locational marginal cost-based full “Day-2” energy market with centralized optimized day-ahead unit commitment and real-time dispatch. Our role included using PSO to develop West-wide nodal production cost simulations for 2020 through 2030 to assess impacts on ratepayers, emissions, grid operations, and the ability to integrate large amounts of variable renewable generation across the region. We also analyzed the findings of other regional markets that have gone through similar transitions, reviewing two dozen ex-post and ex-ante studies of the costs and benefits of regionalization, transitioning from zonal to nodal market design, and migrating from a real-time imbalance market to a full day-ahead market with optimized unit commitments and ancillary services markets. Our work culminated in a public report and several presentations to stakeholder groups across the West and in California. It provided the analytical foundation for active ongoing multi-state discussions about ISO regionalization.

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