By Tom Kleckner

KANSAS CITY — SPP’s Markets & Operations Policy Committee voted to move the deadline for day-ahead market offers up 90 minutes to 9:30 a.m. CT, following a lengthy discussion about whether the benefits justified the change and its price tag.

The committee approved the recommendation by the Gas Electric Coordination Task Force by voice vote.

Assuming approval by the Board of Directors and the Federal Energy Regulatory Commission, SPP will post day-ahead results at 2 p.m. CT, up from 4 p.m. It also shortens the reoffer period to 45 minutes, with reliability unit commitment (RUC) offers due at 2:45 and results posted by 5:15.

The Tariff changes are a first step in complying with FERC’s Order 809, which moved the timely nomination cycle deadline for gas to 1 p.m. CT from 11:30 a.m. and added a third intraday nomination cycle (RM14-2). The commission ordered RTOs to adjust the posting of their day-ahead energy market and reliability unit commitment process results “sufficiently in advance” of the revised gas cycles, or explain why it is not suitable for their markets.

‘Very Little Gain’

SPP’s northern members voiced their continued opposition to the recommendation, saying the adjustments did little to increase the knowledge of next-day gas prices.

“Most winter gas doesn’t trade until 10 p.m.,” said the Omaha Public Power District’s Troy Via.

“I’m really surprised we went down this route,” said Lincoln Electric System’s Dennis Florom. “We see very little gain. We’re making a lot of adjustments, but we’re not getting the key benefit — a timely nomination. By making this adjustment, we are moving further away from the next operating day.”

The Nebraska Public Power District’s Paul Malone, the MOPC’s vice chair, noted that while the GECTF’s recommendation was approved by four lower stakeholder groups, the votes were far from unanimous. The Market Working Group, for example, voted 7-5 in favor with five members abstaining. (See SPP Moving to 9:30 Day-Ahead Close.)

Malone contended FERC’s order was intended to address “critical” gas days.

“This is a change for all days,” Malone said. “The real value we see is better pricing discovery. To get a half-hour change … we’re just struggling with that.”

The revised timeline would not provide day-ahead market results before the 1 p.m. CT nomination deadline, but it would provide 30 minutes before the Intraday 2 nomination. RUC results would be available 45 minutes before the 6 p.m. evening gas nomination.

Enhanced Combined-Cycle Project

In presenting the GECTF’s recommendation, Oklahoma Gas & Electric’s Jake Langthorne said the changes would provide an opportunity to use the evening gas nomination period and provide some price formation in the morning before the day-ahead market closes.

Langthorne also said the move would allow for continued progress with the enhanced combined-cycle project, an effort to provide more sophisticated modeling that captures such plants’ flexibility. The board last year suspended work on the project until after the Integrated System entities join the RTO as full members in October, allowing time for a more thorough cost-benefit study. (See Combined-Cycle Model’s Cost, Benefit Uncertain.)

SPP has estimated it will take approximately $1.5 million and 14 months to implement the schedule changes next year, which would require new software.

SPP Director of System Operations Sam Ellis said “almost 100%” of the spending on the scheduling change would also benefit the ECC project.

“I think $1.5 million is more than enough money,” Ellis said. “Both projects are investments in reducing the market-clearing engine’s solution time.”

Dogwood Energy’s Rob Janssen, a member of the task force, seemed to sway some minds when he expressed a similar long-term view.

“I’m always concerned about costs, but I’m comfortable with this after discussions with staff,” Janssen said. “The staff believes this will improve the market over time. While $1.5 million shows up as a red light, it would be hidden over time the next three to five years. We might as well make the investment and get some value for gas-electric coordination in response to FERC’s order.”

Midwest Energy’s Bill Dowling suggested a shorter RUC process to get gas nominations in as early as possible for the next day. He added, “I do find it compelling to spend some of this money on the ECC project.”