By NOAH BAUSTIN, POLITICO
With help from Camille von Kaenel and Alex Nieves
THE BUZZ OF THE BALL: Establishing a new Western electricity market was a major goal for Gov. Gavin Newsom and legislative leaders in 2025. Now, it’s becoming a reality.
On Friday, Nevada regulators gave NV Energy, the state’s largest utility, approval to join the new extended day-ahead energy market that California’s grid manager is setting up.
That news has California’s energy leaders buzzing.
“The NV Energy approval is particularly pivotal for our market,” Elliot Mainzer, president of the California Independent System Operator, said in an interview.
The reason is largely geographical, because Nevada’s central location makes it a key connector for California utilities and energy producers who hope to link with states in the Southwest, and Idaho, in the North.
The whole point is to have as large a market as possible, one that’s bigger than any single weather system. That way, if electricity demand is spiking in Southern California as a heat wave spurs residents to blast their air conditioners, power plants in cooler regions can alleviate the supply crunch by sending power that’s not in demand locally.
“The progress we are making with … the implementation of the regional market is incredibly important for the progress that we want to make on affordability, reliability and sustainability,” Assemblymember Cottie Petrie-Norris, who authored the bill that paved the path for the new independent market, said in an interview.
That 2025 bill, AB 825 (opens in new tab), allowed California to pass oversight of its electricity markets to an independent entity. Supporters argued that the CAISO would never be able to get widespread buy-in from other states without it, since operators outside of California would fear unfair treatment in a market totally controlled by California.
That is a fear that the CAISO’s competitor has been all too happy to stoke.
The Arkansas-based Southwest Power Pool has also been in the process of setting up its own Western electricity market. That’s forced utilities across the West to pick sides: join California’s EDAM, or SPP’s Markets+.
Kathleen Staks, president of the formation board of the Regional Organization for Western Energy, which will eventually take over governance of California’s electricity markets, said in an interview that the competition was initially healthy, pushing market makers to address participants’ concerns.
“However, we are now at a point where that competition has, at times, turned kind of nasty (opens in new tab),” Staks said.
There’s still some key Western utilities that haven’t decided which market to join. And some in the West remain concerned that, even after the passage of AB 825, EDAM remains a less independent market than Markets+, according to Felix Chow-Kambitsch, head of U.S. West advisory for Aurora Energy Research, a power analytics firm.
“It comes down to having a larger, more liquid market with the EDAM option, versus having a more independent governance with the Markets+ option,” Chow-Kambitsch said in an interview, describing the shape of the debate in energy circles.
Among the fence riders: Idaho Power, which in 2024 said it was “leaning” toward EDAM, but is still “continuing to evaluate market options,” according to its spokesperson, Brad Bowlin. And Seattle City Light is holding off on making a decision “until there is a greater degree of clarity on where and how the two market options develop,” the utility’s spokesperson Jenn Strang said in a statement.
Carrie Simpson, SPP vice president of markets, said in a statement that Markets+ is currently building its systems and will launch in October 2027.
“We continue conversations with entities across the western footprint who are evaluating their market options,” Simpson said, adding that “Markets+ is a compelling choice available to the West.”
California has its own crop of EDAM critics as well.
Jamie Court, president of the consumer advocacy group Consumer Watchdog, opposed AB 825, and continues to fear that broadening California’s electricity market will bring in electricity from producers who don’t share the state’s renewable energy goals.
“I’m concerned … that this is driving us toward dirty energy,” Court said.
But whether Court’s concerns will materialize won’t become clear until the CAISO passes off oversight of its markets to the new regional organization. And there’s quite a few steps that will come first.
Staks and her team at the ROWE have applied for nonprofit status from the IRS and are in the process of searching for members of the organization’s founding board of directors, which they hope to seat this fall. The CAISO plans for the ROWE to take over governance of its markets by the end of 2028.
In the meantime, the CAISO is pushing for a May 1 launch date for the EDAM, which will be governed by the CAISO in its first years of operations. PacifiCorp and California’s three investor-owned utilities will be the founding members of the market, later joined by Portland General Electric, Los Angeles Department of Water and Power, Balancing Authority of Northern California, Public Service Co. of New Mexico, Turlock Irrigation District, Imperial Irrigation District and NV Energy, according to Mainzer.
BHE Montana also plans to join the EDAM in 2028, according to its spokesperson Michael Freeman.
“This is something that many, many people have been working for, for many, many years,” Mainzer said. “I think it’s a remarkable moment.” — NB
