Electricity Markets

WAPA’s Colorado River Storage Project to explore membership in SPP

The Southwest Power Pool (SPP) recently received a letter from the Western Area Power Administration’s (WAPA) Colorado River Storage Project (CRSP) expressing interest in evaluating membership in the organization.

CRSP is the sixth electric service provider in the West to publicly commit to exploring regional transmission organization (RTO) expansion in the Western Interconnection, SPP noted.

In November 2020, Basin Electric Power Cooperative, Deseret Power Electric Cooperative, the Municipal Energy Agency of Nebraska (MEAN), Tri-State Generation and Transmission Association, and WAPA’s Upper Great Plains-West and Loveland Area Projects notified SPP of their intent to evaluate membership in the RTO. The entities’ letters indicate they will work with SPP to evaluate the terms, costs and benefits of putting western facilities under the RTO’s tariff.

If these utilities pursue membership, they would become the first members of SPP’s RTO to place facilities in the Western Interconnection under the terms and conditions of SPP’s open access transmission tariff.

The interested parties currently receive at least one of SPP’s contract-based Western Energy Services in the Western Interconnection. CRSP participates in two -- Western Reliability Coordination and the Western Energy Imbalance Service Market.

Basin Electric, MEAN, Tri-State and WAPA’s Upper Great Plains-East Region are already members of SPP, having joined the RTO in 2015 when they placed their respective facilities in the Eastern Interconnection under SPP’s tariff.

A Brattle study commissioned by SPP found that the move would be mutually beneficial and produce $49 million a year in savings for SPP’s current and new members.

The western utilities joining SPP would receive $25 million a year in adjusted production cost savings and revenue from off-system sales, and SPP’s members in the east would benefit from $24 million in savings resulting from the expansion of SPP’s market, transmission network and generation fleet.

SPP noted that its prior calculations of the value of RTO membership suggest that these benefits are only a portion of those current and new members will derive.

There is additional value not considered by the Brattle study in five-minute real-time economic dispatch, achievement of public policy goals, lowered reserve-margin requirements, consolidation and regionalization of planning and other processes and more, SPP said.

Additionally, SPP said it anticipates its wholesale electricity market, resource adequacy program and other regionalized services can help western members achieve renewable-energy goals and reinforce system reliability.