Dive Brief:

• A broad group of 31 utilities, power generators, market participants, climate advocates and others, has executed agreements to participate in the first phase of Southwest Power Pool’s Markets+ initiative in the West, the grid operator announced Tuesday.
• The initial phase of the Markets+ development includes establishment of a fully independent governance structure, the grid operator said. Signing on to the development phase does not necessarily mean entities will choose to participate in the market, however.
• The Markets+ set of services will expand on SPP’s Western Energy Imbalance Services market, or WEIS, which began operating in 2021. Federal regulators on Friday authorized Xcel Energy subsdiary Public Service Co. of Colorado to participate in the WEIS though they also required a price analysis be completed 15 months after PSCo joins the market.

Dive Insight:

The deadline for interested parties to sign on to the early phase of SPP’s Markets+ initiative passed on Monday, though the grid operator said it had already begun development after funding reached a “critical mass” a month ahead of schedule.

“We’re encouraged to see such a varied group of entities taking an active role in the development of Markets+,” Antoine Lucas, SPP vice president of markets, said in a statement.

Participating utilities include Arizona Public Service Co., Bonneville Power Administration, NV Energy, Salt River Project, Tri-State Generation and Transmission Association, Tucson Electric Power Co. and Xcel’s PSCo. Groups include the American Clean Power Association, Interwest Energy Alliance, Intermountain Power Producers Coalition, Western Power Trading Forum and Western Resource Advocates.

“There’s room for all of those voices to have a say in the design and implementation of our market,” Lucas said.

Xcel said it is participating in the development of Markets+ as it seeks ways to “increase reliability and affordability while meeting our clean energy goals.” But that does not mean the utility’s participation in the new market is assured.

“Taking part in Phase 1 does not mean we will move forward into Markets+ or a Regional Transmission Organization. We will make that decision following our extensive review of the Markets+ design,” Robert Kenney, PSCo president, said in a statement.

BPA Administrator and CEO John Hairston said the utility’s contribution to phase one funding of SPP Markets+ “is an investment that we expect to provide multiple benefits ... Markets such as this are the future of operations in the West and this ensures BPA and its customers will keep pace and help shape these important initiatives.”

As part of the first phase, Markets+ participants and stakeholder representatives will meet in committees and working groups to develop market protocols, tariff and governing documents that SPP must file with the Federal Energy Regulatory Commission for approval, the grid operator said.

SPP’s WEIS began operating two years ago. Xcel announced plans for its Colorado subsidiary to participate in January 2022, and FERC approved that request last week — with a caveat.

Because the PSCo balancing authority area will become a part of the WEIS market footprint, the utility’s participation “raises concerns of whether the PSCo balancing authority area could become a submarket of the WEIS Market,” FERC said in its Friday order.

The commission required PSCo, 15 months after joining the market, to submit an analysis of market-based rate changes “in status filing that includes an ex post analysis with 12 months of price separation data.” FERC added that it may request additional data, “including but not limited to a transmission congestion study and indicative screens.”