The California Independent System Operator Corporation (California ISO) and the Merced Irrigation District executed a memorandum of understanding as part of the first step in the community-owned utility potentially becoming a member of the ISO.
The ISO has posted the MOU on its website and scheduled a stakeholder call on February 28 to answer questions.
Merced is a community-owned utility that provides retail electric service to about 8,000 residential and business customers in the Central Valley. The municipal utility owns about 100 MW of installed generating capacity including the New Exchequer and McSwain hydroelectric facilities, which are currently connected to the ISO grid.
Merced approached the ISO to inquire about the benefits of becoming a participating transmission owner, utility distribution company, load serving entity, and generator owner. Subsequently, it submitted a transmission interconnection request to Pacific Gas and Electric Co. (PG&E) for a 230 kV interconnection between Merced’s electric system and the PG&E owned Wilson substation east of Merced near Highway 140. Those facilities are already part of the ISO-controlled grid.
The ISO Board of Governors will be asked at their general meeting in March to authorize the ISO to move forward with negotiating a transition agreement. The ISO could finalize an agreement with Merced this spring and then file with FERC to facilitate the transition process. If Merced and ISO were to complete the transition, Merced could become a participating generator owner by summer of 2014 and a participating ISO transmission owner as early as July 1, 2015.