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SPP’s Western Power Market Gains Federal Approval

3 min read

The Federal Energy Regulatory Commission conditionally approved Southwest Power Pool’s proposal for a day-ahead wholesale electric power market in the western U.S.

SPP, the not-for-profit regional transmission organization based in Little Rock, announced the FERC’s decision on the proposed market, called Markets+, on Thursday.

Regulatory approval represents a major milestone in SPP’s effort to launch the market in 2027, letting participants advance to a second phase of development and funding. Potential participants include the Bonneville Power Administration, four Arizona entities and Mountain West entities including Xcel Energy Colorado.

SPP worked with 38 western utilities and power entities to develop the Markets+ tariff, and collaborated closely with prospective market participants in the months since the FERC received the proposal in late March. Significant collaboration came after the FERC requested more information on specific tariff elements in a July 31 letter.

What’s Next

Phase two of the project, beginning early this year, emphasizes development, testing and parallel market operations.

Barbara Sugg, in her last weeks as the grid operator’s chief executive officer, called the decision “an important achievement” for SPP. “It reiterates what we know to be true about Markets+ — it’s a superior market design that recognizes and values the needs of all participants.”

Antoine Lucas, SPP’s vice president of marketing and incoming COO, said in a statement that he was thrilled. 

“Markets+ is a collaborative, stakeholder-driven market, which will enhance reliability and provide significant economic benefits to participants across the Western Interconnection, and we look forward to the next phase of market development,” Lucas said.

Commissioners Speak

Several FERC members spoke on the benefits of the Markets+ program in the panel’s open meeting in Washington this week. FERC Chairman Willie Phillips described economic benefits and “associated reliability benefits [that come] when markets allow for efficient dispatch of resources, including during times of system stress.” 

Markets+ will facilitate transmission of power from less expensive generation sources to entities demanding power, officials said. Commissioner Lindsay See called it an important step forward “as the West is continuing to develop and think through the right options” for reliable and affordable power.

The BPA, which delivers wholesale power to 140 utilities and provides transmission service to more than 300 customers, has announced that it will pay for its share of phase-two development as they develop a policy direction in choosing a day-ahead market option by May of this year.

Rachel Dibble, BPA Power Services’ vice president of bulk marketing, said in a news release that participants “crafted” the Markets+ tariff through a robust stakeholder process. “This guarantees BPA has two viable day-ahead markets to consider as we make our way toward a day-ahead market decision later this year.”

Arizona and Colorado

Four Arizona entities announced their intent to join Markets+ in November: Arizona Public Service (APS), Salt River Project (SRP), Tucson Electric Power (TEP) and UniSource Energy Services will join phase two development in 2025 and be part of the market’s launch in 2027.

“Looking forward, our participation in SPP Markets+ is a vital element of our plan to address the increasing energy demands of our customers in a reliable and affordable manner, while also supporting our ambitious 2035 sustainability goals,” said a statement by Josh Robertson, SRP director of energy market strategy.

Xcel Energy Colorado noted that it has been involved in building Markets+ since its inception.

The utility plans to make a filing soon with state regulators for approval to enter the new market, President Robert Kenney said in the release. “Upon a favorable ruling in that proceeding, Xcel Energy-Colorado will execute the Phase 2 funding agreement and proceed to join Markets+.”

SPP guarantees adequate supplies of wholesale power and electricity transmission infrastructure in a 14-state footprint of the middle United States. Its markets ensure competitive wholesale power prices, and the organization provides energy services on a contract basis to customers in both the Eastern and Western Interconnections.



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