Organized wholesale electricity markets (OWM) are centrally managed markets that provide a platform for transparent and competitive wholesale electricity trading. Wholesale electricity trading includes the real-time and day-ahead purchase and sale of electricity among generators and energy suppliers in tandem with services needed to maintain power reliability and quality.
In the U.S., the most advanced organized wholesale markets are operated by Regional Transmission Organizations/Independent System Operators (RTOs/ISOs). RTOs/ISOs are independent grid operators overseen by the Federal Energy Regulatory Commission, which in addition to operating organized wholesale markets, balances power across multiple service territories while ensuring reliability, efficiently dispatches electricity generation in least-cost merit order, manages regional transmission, and establishes stakeholder and governance processes. Learn more about OWM and RTOs/ISOs by downloading the CEBI Organized Wholesale Markets Explainer.
There are currently seven RTOs/ISOs which cover roughly two-thirds of the U.S. and generate billions of dollars of benefits annually. RTOs/ISOs leverage the power of wholesale competition to increase customers’ clean energy purchasing options and drive renewable energy integration. To cost-effectively and reliably transition to a zero-carbon energy grid, RTOs/ISOs must develop and/or expand across regions where they currently do not exist. CEBI seeks to provide education and expert thought leadership on best practices for OWM expansion.
The Western Energy Imbalance Market (WEIM) and Western Energy Imbalance Service Market (WEIS) are voluntary incremental markets that provide a sub-hourly economic dispatch of participating resources to balance energy supply and demand at 5-minute intervals while maintaining transmission and reliability constraints. WEIM is operated by CAISO, while WEIS is operated by SPP, however, as an incremental market that does not provide all the services of an organized wholesale market, customers are unable to experience the full range of potential benefits.
Fact Sheet: How Virtual Power Purchase Agreements Can Enhance Customer Clean Energy Access
The ability to contract for a virtual power purchase agreement in a customer’s organized wholesale market allows customers to drive emissions reductions closer to their operations and may provide a hedge against their energy costs.
In support of its mission to solve the toughest market and policy barriers to achieve a carbon-free energy system, the Clean Energy Buyers Institute (CEBI) has created a clearinghouse of resources for organizations interested in the advancement of clean energy.