Colorado utilities Public Service Company of Colorado (PSCo), Platte River Power Authority and Black Hills Colorado Electric (NYSE:BKH) said Tuesday they plan to join SPP’s Western Energy Imbalance Service (WEIS) market over CAISO’s Western Energy Imbalance Market.
The utilities said the move will allow them to provide cost savings to customers and improve operational efficiencies. They expect to join WEIS in April 2023 and will continue to study long-term solutions for joining or developing an organized wholesale market.
“As we look at opportunities moving forward, this short-term step meets our energy needs to deliver clean, reliable and affordable energy to customers right now,” PSCo President Alice Jackson said. “The energy imbalance market allows us to participate in an organized market while giving us the flexibility to explore a more permanent solution that will help us integrate more wind and solar energy onto our system.”
SPP’s Board of Directors on Tuesday approved an amended Western joint dispatch agreement (JDA) brought forward by the Western Markets Executive Committee that incorporates terms and conditions agreed upon by participants in the PSCo balancing authority. The WMEC met three times the week of Jan. 17 to hammer out differences.
The board’s approval cleared the way for the three utilities to join SPP’s WEIS. The JDA enables generation within its BA to be shared with Platte River, Black Hills and Colorado Springs Utilities (CSU).
PSCo paused a previous decision to join the EIM when CSU said last May it had decided to join WEIS. The Xcel Energy (NASDAQ:XEL) subsidiary approached SPP in August to begin negotiating its BA’s membership in WEIS. (See Xcel Delays Joining EIM to Examine Options.)
A CAISO spokesperson said the grid operator was disappointed to learn PSCo had “decided to change course.”
“We understand and respect its decision. We remain committed to continued collaboration with PSCo as the Western markets evolve,” Anne Gonzales said.
“We’re proud that our relationship-based approach and valuable portfolio of services continues to attract utilities looking to modernize and regionalize the way electricity is delivered,” SPP CEO Barbara Sugg said. “And we’re confident SPP and our WEIS participants will not only benefit from this expansion but will also help these utilities meet their goals of making power delivery more affordable and reliable.”
SPP began operating its WEIS market on a contract basis in February 2021, centrally dispatching energy from the region’s participating resources every five minutes. It currently comprises six members, including Tri-State Generation & Transmission. CSU will join in August.
Tri-State said in a release that PSCo’s decision will bring the remaining 20% of its member load into an organized market. Its Eastern Interconnection load became part of the SPP RTO in 2015.
“We welcome additional participants into the SPP WEIS, which increases the efficiency of the market, lowers power costs and further helps to reliably and cost-effectively integrate renewable energy resources,” Tri-State CEO Duane Highley said. “Our membership in the SPP WEIS has already greatly benefited our members with lower costs, higher reliability and more efficient dispatch of resources.”
Tri-State and CSU are among several WEIS members exploring membership in SPP’s RTO West. The grid operator is also offering a Markets+ service for parties that value RTO benefits but aren’t ready for membership. It has been a reliability coordinator for several Western entities since 2019.
Meanwhile, WEIM is welcoming four new utilities this spring (Avista Utilities, Bonneville Power Authority, Tacoma Public Utilities and Tucson Electric Power). When it adds El Paso Electric, Avangrid and the Western Area Power Authority’s Desert Southwest region in 2023, WEIM will cover almost 80% of the Western Interconnection.
