Southwest Power Pool launches Western Energy Imbalance Services market |

Southwest Power Pool launches Western Energy Imbalance Services market

Tri-State Generation and Transmission Association is one of several regional utilities are participating in the market

The Craig Station coal-burning power plant in Moffat County is pictured Feb. 27, 2020. Tri-State Generation plans to close the plant by 2030.

Hoping to lower wholesale electricity costs, increase price transparency, and mitigate congestion on the transmission system for participating markets, the Southwest Power Pool launched its Western Energy Imbalance Services market Monday morning.

Tri-State Generation and Transmission Association is one of several regional utilities are participating in the market.

The real-time balancing market is the latest of SPP’s contract-based Western Energy Services to be implemented in the Western Interconnection.

“This is an exciting step for SPP and our new market participants in the west. Our electricity markets have played a big role in lowering costs, integrating renewables and enhancing reliability in the east, and we’re excited to see a new part of the country begin to see similar benefits,” said SPP President and CEO Barbara Sugg. “I’m hopeful this is just the beginning of valuable partnerships between SPP and western utilities that will help them and the customers they serve meet their financial, reliability and renewable- energy goals.”

Basin Electric Power Cooperative, Deseret Power Electric Cooperative, the Municipal Energy Agency of Nebraska (MEAN), Tri-State Generation and Transmission Association, the Western Area Power Administration, and the Wyoming Municipal Power Agency announced in 2019 their intent to join the WEIS.

WAPA’s agreement includes the firm electric service loads and resources of Pick-Sloan Missouri Basin Program–Eastern Division in the Upper Great Plains Western Area Balancing Authority footprint and the Loveland Area Projects and Salt Lake City Area Integrated Projects, in the Western Area Colorado Missouri Balancing Authority footprint, according to a press release from SPP.

As the WEIS market’s administrator, SPP will support the reliability of the region’s transmission system and meet demand with the most cost-effective generation available, reducing wholesale electricity costs for participants.

The WEIS will provide price transparency of wholesale energy, allow parties to trade bilaterally and hedge against costly transmission congestion, according to the press release.

“With a low cost of entry, immediate economic benefits and greater market experience for Tri-State, the WEIS delivers real benefits to our members,” said Duane Highley, Tri-State CEO. “Importantly, the five- minute WEIS intra-hour market will greatly aid in the integration of more renewable resources that empower Tri-State’s clean energy transition. This is an important first step toward a full RTO in this region to help Tri-State meet its clean energy goals.”

SPP currently holds the record for the highest one-hour and point-in-time wind penetration ever recorded by the Energy Information Administration. It recently set a SPP wind peak record of 19,848 megawatts on Jan. 14 and was the first U.S. regional transmission organization to see wind as its main fuel source in 2020.

Looking ahead, many of the WEIS participants are now evaluating full membership in the SPP RTO. According to the press release, a 2020 SPP Brattle study found RTO membership could produce an annual savings of $49 million for both SPP and western entities.

If Basin Electric Power Cooperative, MEAN, Tri-State Generation and Transmission Association and WAPA pursue membership in SPP, SPP can extend the reach and value of its services and the synergies they provide when bundled under the RTO structure.

The real-time imbalance market is one of many services SPP offers to western utilities under its Western Energy Services umbrella. In 2018, SPP became the administrator of the Western Interconnection Unscheduled Flow Mitigation Plan. In 2019, SPP launched its Western Reliability Coordination service, through which it ensures the reliability of the bulk electric system in the west on behalf of 12 entities across seven states. In 2020, SPP was hired by entities in the Northwest Power Pool to be the program developer for its regional Resource Adequacy Program.

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