A group of Southeast energy companies on Dec. 11 offered a courtesy preview to state utility regulators in North and South Carolina of a filing the group plans to submit to the Federal Energy Regulatory Commission for the creation of a centralized, automated, intra-hour energy exchange called the Southeast Energy Exchange Market (SEEM).
The companies involved intend to file for approval from FERC by the end of the year and to begin operations as early as fourth quarter 2021.
Founding members of SEEM are expected to include:
- Associated Electric Cooperative
- Dalton Utilities
- Dominion Energy South Carolina
- Duke Energy Carolinas
- Duke Energy Progress
- ElectriCities of North Carolina
- Georgia System Operations Corporation
- Georgia Transmission Corporation
- LG&E and KU Energy
- MEAG Power
- Oglethorpe Power Corp.
- Santee Cooper
- Southern Company
- The Tennessee Valley Authority
Participation in SEEM is open to other entities that meet the appropriate requirements. Some utility commitments will take place following FERC approval.
SEEM is a 15-minute energy market, the first of its kind for the region, that will use technology and advanced market systems to automatically match participants with low-cost energy to serve customers across a wide geographic area, according to a news release related to the market.
The new SEEM platform will facilitate sub-hourly, bilateral trading, allowing participants to buy and sell power close to the time the energy is consumed, utilizing available unreserved transmission. The exchange is an extension of the existing bilateral market.
As part of their evaluation, SEEM members performed a detailed study to assess the costs and benefits of forming such a platform.
An independent third-party consultant estimated the platform’s total benefits to members and their retail customers range from $40 million to $50 million annually in the near-term, potentially growing to $100 million to $150 million annually in later years as more solar and other variable energy resources are added.
After validating the concept of forming this market with the study, SEEM members discussed the potential structure and benefits with numerous energy regulators, policy makers, consumer advocates, non-governmental organizations, energy associations, solar developers and business customers. Feedback helped strengthen the platform agreement by adding more transparency measures, according to the news release.
SEEM members will maintain local control of their generation and transmission assets and participation is voluntary.
Many of the member companies operate within state guidelines and directives, so having full control over their respective generation and transmission resources is an important governing requirement.
“TVA continues to actively work with other utilities on the proposed Southeast Energy Exchange Market, which offers the potential of lower costs and optimized renewable energy resources that both support TVA’s mission of serving the Tennessee Valley,” said Jim Hopson, TVA Public Information Officer.
“The courtesy preview of the upcoming FERC filing shared today is another important milestone in SEEM’s formation,” he said.
"Santee Cooper will take up our required SEEM approval process after FERC has reviewed and made its decision on the proposed platform," said Mollie Gore, Corporate Communications Director at Santee Cooper. "We do believe there is an opportunity for real, meaningful savings for customers here, plus the ability to better integrate renewables – which is helpful given Santee Cooper’s aggressive plans for new solar over the next decade. It is also very low risk, which is important."
“We are pleased to be part of this effort to bring benefits to the southeast and our customers," said Drew Elliot, Manager, Government Affairs at ElectriCities. "SEEM will maximize the investment in the transmission system and should allow better integration of renewables in the region. We see this as a no-regrets strategy to lower costs for customers due to the relatively quick set-up and low costs – both start-up and ongoing – compared to other wholesale market concepts.”
In a recent blog, Elise Caplan, Director, Electric Market Analysis, at the American Public Power Association, notes that the Southeast is the largest geographic area without some form of a centrally dispatched energy market.
“It is therefore no surprise that various entities are giving attention to the development of a coordinated energy market in the Southeast,” she wrote, noting the significant benefits that can be achieved.
While APPA does not have a position on whether some form of organized energy market should be adopted in the Southeast, Caplan said that there are some important lessons to be learned from other regions, which she details in her blog.