NWEC Celebrates the Launch of the Extended Day-Ahead Market 

May 1 marks a momentous day for affordable, reliable, and clean energy in the Northwest and beyond. All of us rely upon a regional, even West-wide, electric grid to power our homes and businesses. Throughout our history utilities across the region have traded power between each other to balance out generation and demands. This system leverages the diverse resources across our region—e.g., wind in the eastern parts of the northwest states, solar in the arid areas, and hydroelectric power to balance it all.  

However, these resources have impacts on our lands, wildlife, fish and communities. As we grow both the scale of clean energy and our overall needs, we must modernize the trading system so we can minimize impacts, reduce overall costs, and increase reliability.

Today, a major new mechanism went live: the Extended Day-Ahead Market (EDAM). This new market mechanism enables utilities to plan for each successive day to ensure sufficient resources to meet expected needs. Planning ahead enables more clean energy options and helps control costs. By joining the EDAM, utilities can use an integrated and sophisticated system to match the expected output of wind and solar resources, river flows, and energy needs to find the least cost available resources. All credible studies show this modern approach to energy trading is likely to reduce power costs and maintain reliability.

After years of planning and processes, now the EDAM is operating—with Northwest utilities leading the way. As the first entity to go live, PacifiCorp builds upon decades of trading power with entities in California and is paving the way for other utilities to join. Portland General Electric is expected to be the next entity to go live in October. 

A number of utilities have also announced plans to join, covering a large portion of the West. For example, NV Energy recently announced they will join the EDAM, thus greatly expanding the market’s (and thereby the Northwest’s) access to solar power and a growing geothermal resource base. And we expect more utilities will join, realizing the benefits of a larger market footprint.

This progress builds on two foundations: 

• The Western Energy Imbalance Market has been operating since 2014 and delivered over $8.6 billion in energy cost savings to the region. The WEIM enables utilities to trade within each hour to balance resources and loads. The EDAM extends this proven mechanism to address each hour of the day, thereby increasing the potential benefits for power costs, reliability, and clean air.
• Improved governance that promotes the public interest, respects the differing policies of Western states, and provides independent oversight. Stakeholders across the West, including NWEC, were engaged in a multi-year effort to develop and secure these improvements through the Pathways Initiative. As the EDAM market grows, the Regional Organization for Western Energy, which continues to be shaped by stakeholders across the west, will take on this key independent governance role. 

NWEC has been and will continue to be an advocate for the largest West-wide market possible. With the launch of EDAM, the West has its chance. We have called on the largest supplier of electricity in the Northwest, Bonneville Power Administration, to reconsider its decision to join a competing day-ahead market in the West. Study after study, including BPA’s own economic analysis, demonstrate more benefits to the region if BPA chooses to join EDAM instead. In addition, with the development of an entity fully controlled by Western interests and independent of any single entity to govern EDAM, EDAM represents a stark and inclusive contrast to any other proposed market mechanism.

We continue to encourage every utility in the Northwest to join the EDAM. Through collaboration, growing our footprint, and modernizing our system, we can create a grid that accesses high-quality clean energy at the lowest possible costs while mitigating the risks of localized stress from weather conditions or outages.