By Jason Fordney

Peak Reliability and PJM Connext on Tuesday refined their pitch to attract participants to a new Western energy market, saying they envision “a marketplace built by and for the West.”

“We sense, and we have heard, some people saying it’s coming down to the time for some choice in markets in the West again,” PJM Connext’s Fran Barrett said during a Feb. 6 meeting and conference call hosted by Peak. He added that PJM is “heavily, heavily focused on the bottom line.”

Barrett emphasized PJM’s experience operating a 13-state market in the East, and indicated a focus on reliability, self-governance and providing options for various market structures for potential participants. Officials from the organizations provided more detail on how the new Peak/PJM market would coordinate with other market and non-market areas, including possible congestion management practices.

Peak and PJM first described their joint market initiative in January. (See Peak, PJM Detail Western Market Proposal.) In a presentation Tuesday, they laid out three possible market options “customized to the needs of participants,” each of which includes a nodal real-time market, day-ahead market, financial transmission rights, integrated settlement and credit management. Settlement would be based on PJM’s structure, modified for the West, with a central counter-party structure and weekly billing.

Interregional Coordination Proposed

Peak and PJM also provided more detail about how their proposed market would coordinate with other areas in the West. Their goal is to implement the market in two phases, the first using an “enhanced curtailment calculator” tool in a process comparable to the transmission loading relief procedure used in the Eastern Interconnection.

A second “market-to-market” phase would be more complex and similar to how PJM conducts coordination with MISO and NYISO. In those cases, the RTOs use combined redispatch as a joint congestion management tool for greater efficiency, and costs are allocated between RTOs based on transmission flows and negotiated historical rights.

Barrett said Peak and PJM did not know exactly what minimum size footprint or configuration would be necessary to make the proposal work, noting they were gathering data to study the issue.

“We haven’t modeled in the Swiss cheese or the string cheese or if we will have people all over the place,” Barrett said, describing the possible variable shapes of the market’s footprint.

CAISO recently announced it will depart Peak, become its own reliability coordinator and offer to migrate Peak’s current members. (See CAISO to Depart Peak Reliability, Become RC.) The ISO also plans to expand its day-ahead market into the Western Energy Imbalance Market (EIM), while Mountain West Transmission Group is negotiating to join SPP setting up possible competition for a new Western RTO. (See CAISO Bid for Western RTO to Face Competition in 2018.)

[Editor’s Note: An earlier version of this article incorrectly described PJM Connext as under FERC jurisdiction.]