Southwest Power Pool to launch energy imbalance market as alternative to CAISO

Dive Brief:

The Southwest Power Pool announced Monday it will move ahead with development of a Western Energy Imbalance Service (WEIS) market to balance generation and load regionally and in real time.
The market aims to reduce capacity and energy costs, provide price transparency for wholesale energy, and ensure efficient use of the transmission system. SPP's new market would provide an alternative to the California ISO's imbalance market, and would operate alongside reliability coordinator (RC) services the Southwest grid operator plans to offer in December.
The market is expected to launch in December, 2020 and will be administered on a contract basis, meaning utilities do not need to be SPP members in order to participate.

Dive Insight:

SPP is growing its services and capabilities, with the upcoming WEIS just one of several contract-based products from the regional grid operator.

SPP also administers the Western Interconnection Unscheduled Flow Mitigation Plan and will offer RC services to a number of utilities in about six months. The RTO also said it is in the early stages of developing planning coordination services, "by which it would help utilities study and plan upgrades to the region's transmission system."

Like other imbalance markets, SPP said the central feature of its WEIS would be an intra-hour, centralized dispatch of energy from participating resources.

"This centralized dispatch more efficiently ensures the reliability of the transmission system and minimizes the production costs of satisfying load's resource obligations," SPP said in its market proposal.

The new market will accommodate a diverse set of resource types, and the RTO said it will facilitate resource registration as part of the market-participant onboarding process. Loads and resources in participating balancing authorities must be registered with the WEIS, unless they include behind-the-meter generation resources less than 10 MW.

Source: Southwest Power Pool (click on chart to expand)

Implementation of the new market will take about 16 months, SPP said, assuming it can get enough customers on board by Aug. 1 to ensure funding of implementation costs.