Bad battery bids: FERC ruling costs REV Renewables $2.67M
Storage

Bad battery bids: FERC ruling costs REV Renewables $2.67M

A recent Federal Energy Regulatory Commission (FERC) ruling has prompted Vista Energy Storage, operated by REV Renewables, to cough up $2.67 million for placing bad battery bids in the California Independent System Operator (CAISO) market in the summer of 2022.

As detailed in a decision issued on August 6, Vista violated the CAISO’s Open Access Transmission Tariff “By submitting bids to CAISO when the Vista Battery was not reasonably expected to be available and capable of performing at the levels specified in the bids, on 33 days during the summer of 2022.”

Vista Energy Storage has been operational since 2018 and was at one time the largest BESS in the U.S. REV Renewables owns about 2.8 GW of capacity in the United States including 615 MW of battery energy storage, all in California. It was formed in 2021 by LS Power, whose affiliates own about 87% of REV.

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As a result of the FERC decision, Vista has agreed to pay a civil penalty of $1 million to the United States Treasury and will return the $1.67M it received as a result of bids to CAISO for the Vista Battery during those 33 days in 2022. Vista “stipulates to the facts” in the settlement, but neither admitted nor denied the allegations. Vista has also agreed to conduct compliance training and will submit one annual compliance monitoring report.

What did they do to violate the CAISO Tariff?

REV’s Vista Battery has a maximum storage capacity of 40 Megawatt Hours (MWh) and can fully charge or discharge within one hour. FERC’s Office of Enforcement concluded REV violated the CAISO Tariff by providing an incorrect initial state of charge.

“Vista told CAISO (in a bid submitted by 10 a.m.) that it forecasted its Initial State of Charge the next day (i.e., 14 hours after submitting the bid) to be at or below 4 MWh, even though the Battery had a 36 MW or larger Regulation Up award for the final hour of that day,” reads part of FERC’s decision. “Vista knew, or should have known, that because of that Regulation Up award, the Ancillary Services State of Charge constraint would ensure that Vista’s actual State of Charge would be around 20 MWh during the final hour that day.”

On those 33 summer days, Vista received 40 MW Regulation Down awards for the first hour of the next day, due to that incorrectly reported 4 MWh or lower Initial State of Charge figure.

“Vista knew, or should have known, it would not have received these awards in the first hour of the day if it had submitted an Initial State of Charge value of 20 MWh,” continues the FERC ruling. “On each of these 33 days, Vista’s low Initial State of Charge values also enabled it to obtain 40 MW Regulation Down awards for several hours after the first hour.”

During the 33 day span, Vista received approximately $1,485,000 in Bid Cost Recovery payments that CAISO made because of Regulation Down Awards that Vista would not have obtained if it had submitted Initial State of Charge values consistent with the CAISO Tariff, rather than values that resulted in Vista’s obtaining the largest possible Regulation Down awards. Vista also received approximately $185,000 for Regulation Down awards during that time frame.