July 29, 2020

SPP stakeholders discuss wind, market roadmap, 2020 goals and HITT improvements

LITTLE ROCK, Ark. — With approvals and guidance from our stakeholder-led committees and independent board, Southwest Power Pool (SPP) looks to implement policy changes and refine our market-development strategy in the second half of 2020.

During their quarterly meetings in July 2020, the SPP board approved four recommendations of the Holistic Integrated Tariff Team (HITT), and the Market and Operations Policy Committee (MOPC) approved the 2020 Strategic Market Roadmap. More than 250 stakeholders attended the meetings where they also discussed SPP’s energy markets, transmission planning, real-time electric grid operations and corporate affairs.

SPP is making strides toward our corporate goals despite nearly all staff working remotely since March in response to the COVID-19 pandemic, President and CEO Barbara Sugg said. Sugg noted significant progress in implementing recommendations from the landmark 2019 HITT report; continued expansion in the West, including the planned February 2021 launch of SPP’s Western Energy Imbalance Service market; improved collaboration with the Midcontinent Independent System Operator; plans to define a new strategic plan later this year; and efforts to effectively measure and communicate the organization’s value.

Consistent with the Value and Affordability Task Force’s efforts that concluded in 2019, SPP remains dedicated to providing excellent service while operating as efficiently as possible.

“SPP is committed to remaining affordable,” Sugg said. SPP ceased business travel in response to the pandemic and will continue holding many of our meetings virtually in 2021 as a cost-saving measure. A projected over-collection of administrative fees in 2020 could contribute to reductions in SPP’s 2021 net revenue requirement.

“We are on track for wind to be our number one fuel this year,” Sugg said. “We have 24 gigawatts of wind connected to the grid and expect to have 27 gigawatts by the end of the year.”

In June, wind production was the highest SPP has ever experienced. We reached a new wind peak July 17, when wind resources participating in our market generated a record 18.3 gigawatts of electricity.

This spring, annual electricity demand fell to as much as 8-10 percent below historical forecasts due to COVID-19 but has now returned to normal.

The MOPC approved the 2020 Strategic Market Roadmapthat will guide enhancements to SPP’s wholesale, day-ahead Integrated Marketplace. Staff and stakeholders worked together to select 44 initiatives that will enhance our market’s efficiency, transparency, reliability, price formation and price convergence.

The board approved four HITT recommendations, bringing the total of completed recommendations to eight out of 21.

  • SPP performed comprehensive analysis to evaluate challenges in maintaining electric reliability with a changing generation mix. The studies indicated that while our region has strong voltage performance, increased renewable generation means additional compensation mechanisms may be needed to support frequency response. 
  • SPP will file a tariff revision with the Federal Energy Regulatory Commission to allow greater flexibility in committing fast-start generating resources near real-time.
  • Stakeholders discussed whether to change the benefit/cost ratio for economic projects in the Integrated Transmission Plan, and they voted to keep the ratio at 1.0.
  • Per the SPP Regional State Committee’s policy decision, SPP will establish a process to evaluate how to allocate costs of qualifying 100-300-kilovolt transmission projects that are primarily used to move power out of the local transmission pricing zone.

Access meeting materials from the July 2020 stakeholder meetings at the links below:

Regional State Committee materials
Markets and Operations Policy Committee materials
Board of Directors and Members Committee materials

Derek Wingfield, 501-614-3394, dwingfield@spp.org