PORTLAND, Ore. — The Bonneville Power Administration could face high implementation fees and operating costs under both SPP’s Markets+ and CAISO’s EDAM, but exact amounts are still in flux, and various factors could soften the financial blow, staff members said during BPA’s member meeting Jan. 29.

Rachel Dibble, vice president of bulk power marketing at BPA, told RTO Insider that implementation fees are “one part of the puzzle” in the agency’s final market decision. The agency will weigh those considerations against results of production cost models, “as well as all the other quantitative elements that weren’t included in the production cost model,” Dibble added.

“As far as the magnitude of those numbers, they probably sit more in the ongoing revenue … and costs that we would generate from participating in the market,” Dibble said. “I would expect over time, we would make back all of the money that we would be investing in getting ready to enter a market. So, we will certainly consider them, and they will be part of the decision.”

SPP estimates that Phase 2 implementation costs across the entire Markets+ footprint will be approximately $150 million, and it is unclear exactly how much of that BPA would be responsible for. Agency staff have noted it is probably about $25 million, which is more than the $2.5-$3 million in implementation fees expected under an EDAM scenario.

However, CAISO has also projected $29 million annually in grid management charge fees for the BPA BAA across all scheduling coordinators. The charge is a transactional fee applied to each transaction, and the agency itself would “bear only a share of these charges based on its activities representing its loads and resources in the market,” according to a staff presentation.

Andy Meyers, market initiatives policy lead with BPA, noted the agency itself would pay less than $29 million under EDAM, adding that “knowing exactly what Bonneville’s portion of that is an … outstanding question, but knowing kind of where the maximum is for the BAA is helpful in providing a reference point.”

By contrast, the $150 million Phase 2 costs associated with Markets+ would be financed, and BPA would repay its portion of the loan with a market transaction fee applied to each transaction made in the market. The $150 million covers staff, facilities, infrastructure, tools and applications.

BPA would pay its share of the Phase 2 funding fees on top of annual operating costs, which are projected to be between $13 million and $15 million, according to the staff’s presentation.

Still, Laura Trolese with The Energy Authority noted that BPA would pay Phase 2 funding fees on market transactions over several years, which could potentially limit the financial impact.

Spencer Gray, executive director of the Northwest & Intermountain Power Producers Coalition, asked whether BPA would still be on the hook for its share of the Phase 2 portion if the agency decides to leave Markets+ after signing a Phase 2 agreement.

BPA Chief Business Transformation Officer Nita Zimmerman responded that it “gets into the specifics of the funding agreement. That’s up to SPP to share and not me. It really depends on how far the funding agreements go as to how much we would be on the hook for and at what point.”

Likewise, BPA could not provide a definite answer to what extent the fee agreements factor in “inflationary assumptions,” following a question by Stefanie Johnson, strategic adviser at Seattle City Light.

There are still details, like specific amounts, timing and mechanics, that BPA needs to iron out before it can give stakeholders a clearer picture of how implementation fees would impact the agency under either Markets+ or EDAM. The agency is also working on estimates for internal implementation costs, staff said.

BPA has said it will issue a draft day-ahead market decision in March and a final decision in May.