Dive Brief:
- The Mountain West Transmission Group is moving through the process to integrate into the Southwest Power Pool, with the SPP's board of directors approving a set of policies defining the terms of its membership this week.
- Mountain West is a group of eight entities in the Western Interconnection that announced in September they would pursue SPP membership. Studies have estimated benefits to the group as much as $154 million.
- Mountain West's planned move has set other changes in motion, as it would no longer use Peak Reliability's services. The California ISO has indicated it will begin acting as its own reliability coordinator.
Dive Insight:
Full integration off Mountain West into SPP is a process that will take years, but the board this week approved the next phase. According to a statement, the vote results from a year of negotiating the terms and conditions of Market West's proposed membership.
SPP says integration will take about two years, though reliability coordination services will be implemented in late 2019.
The board approved a set of policies that will govern Mountain West's membership, including provisions for east and west balancing authority areas and planning regions that will follow the same transmission planning processes. Also addressed: cost allocation of transmission expansion specific to each planning region, and the joint dispatch of electricity via SPP’s wholesale market under a single set of rules.
SPP’s Regional State Committee would also be expanded to include state commissioners from the Mountain West region.
But Mountain West's move will have impacts on others. The coalition of 10 electricity service providers has more than 6 million customers, which will mean fewer customers for Peak Reliability, its current reliability coordinator.
That will likely mean higher costs for Peak members, which in turn led to the California ISO announcing in January that it will act as its own reliability coordinator. And, CAISO announced it will offer reliability services to any transmission owner interested, and claims it will do so at a lower cost than Peak.
SPP has been operating for more than three quarters of a century and serves a 14-state region. The grid operator estimates current members could benefit to the tune of $500 million in the first decade of Mountain West’s membership.
