Dive Brief:

• Southwest Power Pool on Wednesday published details of its proposed Markets+ service, the grid operator’s bid to centralize day-ahead and real-time unit commitment and dispatch in a Western energy market.
• The Markets+ set of services would build on SPP’s Western Energy Imbalance Services market, which began operating in 2021.
• Markets+ would also utilize “hurdle-free transmission service across its footprint and pave the way for the reliable integration of a rapidly growing fleet of renewable generation,” SPP said in a statement. Participants interested in funding further market development must sign agreements by April 1.  

Dive Insight:

SPP has been communicating with Western stakeholders since 2021 to sketch out a day-ahead and real-time market. The governance document released yesterday is a result of months of work with potential customers, the grid operator said.

“Collaboration with Western stakeholders to design the Markets+ service offering has been a tremendous effort,” SPP President and CEO Barbara Sugg said in a statement. “I’m confident we can design and deliver a market that addresses challenges unique to the region and provides value to Western customers.”

SPP’s plan includes a two-phase development process for the Western market, beginning with potential participants and stakeholders financially committing to design the market protocols, tariff and governing documents. The second phase would launch on approval of those documents by the Federal Energy Regulatory Commission. SPP expects it will take about 21 months to prepare the FERC application.

During the second phase, SPP said it would acquire “necessary software and hardware while participating entities fully commit to fund and are integrated into the system.”

“For utilities that see value in these services but who aren’t ready to pursue full membership in a regional transmission organization at this time, Markets+ provides a voluntary, incremental opportunity to realize significant benefits,” the grid operator said.

The energy and reserve markets processes include a price-based day-ahead market, a price-based real-time balancing market and a reliability unit commitment process.

The day-ahead market “provides market participants with the ability to submit offers to sell energy, flexibility reserve products and/or to submit bids to purchase energy,” according to SPP’s plan. The real-time balancing market “provides market participants with the ability to submit offers to sell energy and flexibility reserve products.” Energy and reserve markets operations will “simultaneously or jointly optimize resource offers for energy and reserve in the security constrained unit commitment and security constrained economic dispatch algorithms.”

The market operator will also be responsible for economical dispatch of generation throughout the market footprint, SPP said, while transmission service providers and owners will continue to own and operate the system.

“The market region is broader than a single transmission provider’s system and uses transmission and resources differently than traditional bilateral operations,” SPP said. “Regional, non-pancaked transmission use facilitating the receipt of energy from any resource in the market region to meet load obligations is necessary to facilitate the most economical market solution.”

SPP’s Markets+ offerings build on its Western Energy Imbalance Market, which launched in February 2021 and is designed to help keep wholesale electricity costs low, increase transparency and mitigate transmission congestion.

SPP said that throughout its first year of operation the imbalance market “performed well and to the expectations of its participants, enhancing both reliability and economics and paving the way toward even greater value as it grows in size and leads to the development of Markets+.”

Bonneville Power Administration, Avista Corp., Chelan County Public Utility District, Grant County Public Utility District, Puget Sound Energy, Tacoma Power and Powerex Corp., the power trading arm of BC Hydro, have all indicated they will work with SPP to develop the Markets+ proposal.