Houston — The Federal Energy Regulatory Commission approved Dec. 23 the Southwest Power Pool's Western Energy Imbalance Services tariff, paving the way for the grid operator to launch the real-time balancing market slated to serve entities in the Western Interconnection.
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SPP operates as a regional transmission organization in the Eastern Interconnection, where it administered a separate energy imbalance service market before launching its integrated marketplace for that region in 2014. It is currently jockeying with the California Independent System Operator for position to offer energy imbalance services across the US West.
"We're very pleased with FERC's order on our WEIS market governing documents and are excited to be able to proceed with our implementation efforts, which are well on their way," Bruce Rew, SPP senior vice president of operations, said in a news release. "[The Dec. 23] order is another significant milestone on the way toward our planned February go-live."
SPP entered into a period of parallel operations with its market participants in early December, during which participants continued testing and training in the WEIS market's production environment.
SPP announced Nov. 12 that it received letters from several of its WEIS participants who have committed to evaluating full membership in the SPP regional transmission organization. SPP will facilitate a public new-member integration process to evaluate the costs, benefits and other impacts of this potential move, and it will do so simultaneously with the WEIS implementation effort, according to an SPP news release.
FERC rejection, tariff changes
FERC rejected the initial SPP tariff filing (ER20-1059, ER20-1060) without prejudice and identified five primary issues that needed to be addressed – two main issues that caused FERC 's rejection and three suggestions.
FERC 's July 31 order particularly noted flaws with SPP 's proposed use of transmission capacity and with the role it sought to assign the reliability coordinator in the WEIS market. The commission also provided guidance on supply adequacy, marginal losses and market power issues.
SPP addressed the issues identified by FERC and refiled the tariff after the SPP board approved the changes in September. SPP sought FERC approval by the end of the year to remain on schedule for the February launch.
The WEIS market is a narrowly defined service offered by SPP to utilities in the Western Interconnection under a contract. It will balance generation and load regionally and in real time for participants. Utilities do not have to be a member of the SPP regional transmission organization to participate.
The market will centrally dispatch energy from participating resources throughout the region every five minutes, enhancing both the reliability and affordability of electricity delivery from utilities to their customers, according to SPP.
SPP will maintain reliability of the region's transmission system and meet demand with the most cost-effective generation available, reducing wholesale electricity costs for participants.
Like SPP 's previous markets, the WEIS will provide price transparency of wholesale energy, allow parties to trade bilaterally and hedge against costly transmission congestion.
Eight utilities will participate in the WEIS Market when it launches in February 2021, including Basin Electric Power Cooperative, Deseret Power Electric Cooperative, Municipal Energy Agency of Nebraska, Tri-State Generation and Transmission Association, Wyoming Municipal Power Agency and Western Area Power Administration's Upper Great Plains West, Rocky Mountain Region, Colorado River Storage Projects.