Southwest Power Pool has signed up three big clients — including one led by a former Arkansan — for its electrical grid services in the Western United States, announcing an agreement in which SPP will centrally dispatch energy from the companies to balance electricity loads in the region.
Basin Electric Power Cooperative, Tri-State Generation & Transmission Association and the Western Area Power Administration announced Monday that they have joined SPP’s Western Energy Imbalance Service market. The market will dispatch energy from the companies every five minutes, correcting demand imbalances.
SPP, which manages the electric grid and wholesale energy market for the central United States as a designated regional transmission organization, is based in Little Rock. Basin Electric is a consumer-owned cooperative based in Bismarck, North Dakota, transmitting power to 141 member rural electric systems in nine western states. Tri-State Generation is a nonprofit transmission cooperative in Westminster, Colorado, north of Denver.
Tri-State’s CEO, Duane Highley, was previously CEO of Arkansas Electric Cooperative Corp. of Little Rock and is highly aware of SPP’s operations. WAPA, based in Lakewood, Colorado, is one of four power-marketing administrations authorized by the U.S. Department of Energy, and is responsible for delivering wholesale federal hydropower to 15 central and western states.
“Through the WEIS, our regional utilities are moving forward together with a cost-effective solution that quickly increases market efficiencies, reduces expenses for our members and electric consumers, and supports Tri-State’s rapid transition to cleaner energy,” Highley said. “Our entry advances the goal to provide utilities across the West options to participate in a real-time, beneficial market.”
As market administration, SPP will enhance the reliability of the regional transmission system and coordinate loads to meet demand with the most cost-effective generation available, “reducing wholesale electricity costs for participants,” an SPP news release said. “Like SPP’s previous markets, the Western Energy Imbalance Service will provide cost transparencies and let parties trade and hedge against transmission congestion.
“SPP has a proven track record in operating energy imbalance and full day-two markets,” Paul Sukut, Basin Electric’s CEO and general manager, said in a statement. He called SPP “an excellent choice,” with “a proven stakeholder process and a governance structure that specifically includes commissioners from state regulatory commissions.”
SPP will be accepting commitments from additional Western customers through Oct. 25.
“We’re a stakeholder-driven organization that believes in the power of partnership,” said Nick Brown, SPP’s president and CEO. “We want to do more than just launch a wholesale electricity market in the West. We want to work with utilities to understand the challenges they face and develop smart solutions that benefit the whole region. That’s how we operate as an RTO, and it’s how we plan to administer this and other contract services in the West.”
SPP also administers the Western Interconnection Unscheduled Flow Migration Plan and is on point to launch reliability coordination services for a number of Western utilities in December.