FERC last week accepted SPP Tariff revisions implementing recommendations from the RTO’s stakeholders on fast-start resources and ramping products.

The commission accepted SPP’s compliance filing on fast-start pricing but directed a further compliance filing (ER20-644). It also accepted Tariff revisions creating two new ramp capability products for both ramping up and down (ER20-1617).

The proposed Tariff revisions were both included in the Holistic Integrated Tariff Team’s 21 recommendations last year. The HITT reviewed SPP’s models, processes and operations as part of its effort to integrate the expansion of renewable energy, boost reliability, and improve transmission planning and the wholesale market. (See SPP Board Approves HITT’s Recommendations.)

FERC found SPP’s fast-start pricing practices to still be unjust and unreasonable and directed another compliance filing, saying they again do not allow prices to reflect the marginal cost of serving load. The commission last year wrapped up investigations of several RTOs under Federal Power Act Section 206 and ordered SPP to eliminate inflexible operating limits and other rules that it said were preventing prices from reflecting the marginal cost. (See FERC Orders Fast-start Rules for SPP.)

The commission said two aspects of SPP’s proposal required further revisions. It directed the RTO to provide that, for pricing purposes, fast-start resources’ composite offers be calculated with as-committed commitment costs, regardless of the current offer.

It also ordered SPP to revise its Tariff to provide that a fast-start resource’s commitment costs will be amortized over its economic maximum operating limit and its minimum run time, striking the RTO’s use of the phrase “over an hour.” It said the revisions should provide that the grid operator will calculate the no-load cost added to each breakpoint of a fast-start resource’s energy offer curve by dividing the resource’s no-load offer by its economic maximum operating limit and by the ratio of the number of intervals needed to meet the resource’s minimum run time to the number of intervals in an hour.

FERC rejected the SPP Market Monitoring Unit’s contention that the RTO’s proposal could lead to “unmitigated economic withholding in the dispatch run, potentially resulting in unrelieved congestion and reduced reliability.” The commission found insufficient evidence in the record that the instances of economic withholding contemplated by the MMU would occur frequently enough under SPP’s proposal “to warrant additional mitigation in the dispatch run.”

The commission did agree with the MMU that SPP’s proposal presents a gaming opportunity for fast-start resources because a resource “will have the unique ability to hold its energy offer constant while changing its start-up and no-load offers, and … its composite offer.”

It found that, “on balance, eliminating this potential gaming opportunity outweighs the smaller potential for improved price formation associated with allowing fast-start resources to update their commitment offers after being committed by the market and set price for legitimate reasons in order to recover costs not otherwise recoverable in incremental energy offers.”

FERC said several other issues raised by the MMU and Golden Spread Electric Cooperative were beyond the proceeding’s scope.

SPP has 60 days to reply and must include an effective date that reflects its estimate of when development, testing and software system changes are complete.

Ramp Capability Given Go-ahead

In accepting SPP’s ramp up and down products, FERC ordered the RTO to submit an informational filing notifying the commission of the actual effective date at least 30 days before the Tariff revisions are added to the system software.

Golden Spread protested SPP’s filing, contending that it did not allow offline fast-start resources to participate in the products. The co-op also said the products would reduce the instantaneous load capacity by the amount of cleared ramp capability in a given operating interval. With the reduction, the co-op said, the instantaneous load capacity could be over-procured, leading to price distortion.

FERC agreed with the MMU, which supported SPP’s filing and said that offline resource participation would be impractical under the proposed construct. “As designed, the market clearing engine would be unable to properly evaluate or efficiently dispatch these resources,” the commission said.

Noting the MMU “commits to tracking potential issues with the demand curves going forward and recommending improvements if appropriate,” FERC encouraged SPP “to remain engaged” with the MMU and stakeholders as it gains experience with the ramp products.

Exit Fee Compliance Filing Accepted

The commission also accepted SPP’s compliance filing in a docket related to the elimination of the RTO’s exit fee for non-transmission owners (ER19-2522).

FERC in December rejected a rehearing request from SPP and its load-serving entities. It directed a compliance filing revising the RTO’s Tariff to ensure that a withdrawing non-TO is only exempt from paying a share of SPP’s long-term financial obligations and not all existing obligations associated with the member’s withdrawal. (See FERC Denies Rehearing of SPP Exit Fee Decision.)

In fully accepting SPP’s compliance, FERC rejected protests by renewable energy interests, who argued that the revisions to the grid operator’s membership agreement created “ambiguity” as to which costs would be borne by withdrawing non-TOs. EDF Renewables, RWE Renewables Americas and Savion also contended that the agreement’s provisions could be interpreted to say that withdrawing non-TOs are subject to a share of SPP’s long-term financial obligations.

The commission found that the proposed phrase “incurred by SPP directly due to the termination” requires a direct connection between the costs that SPP may recover and the membership’s termination. It said it is “reasonable” for the grid operator to recover costs it incurs directly because of a member’s termination of its membership.

FERC said the requirement that departing members pay a share of SPP’s long-term debts in the event of a partial termination does not apply to non-TO members because they “do not have load, as reflected by SPP’s proposed ‘if applicable’ language.”

The proceeding stems from a 2018 complaint by the American Wind Energy Association and the Advanced Power Alliance, which have long argued against the exit fee. (See Wind Groups Challenge SPP Exit Fee.)