Stakeholder Report: December 2024
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Barbara Sugg, President and CEO
In December we reflect on the year’s accomplishments and look ahead to 2025. As reported at our Dec. board meeting, SPP had a very successful year, making significant progress with all of our corporate goals and strategic plan initiatives. On April 1st, COO Lanny Nickell will ascend to the CEO role as I head off to enjoy retirement. It’s been an honor to lead SPP through a period of rapid growth and maturation. I’m very grateful for the opportunity and excited to pass the reins to Lanny, my trusted colleague and partner.
Earlier this month, the SPP board re-elected John Cupparo to serve another two-year term as the board chair. Ray Hepper was elected to serve as the board’s vice chair. We are very appreciative of the leadership Elizabeth Moore provided as vice chair for the last two years and have no doubt her contributions to SPP’s success will only increase as she continues her service on the SPP board.
On a more somber note, we very recently paid our respects to long-time SPP board member, Julian Brix. Julian served faithfully on the SPP board for 14 years, with a front-row seat to many of the accomplishments we recorded during that time. Julian passed away peacefully with his family by his side on Dec. 9, 2024. We continue to hold his family in our thoughts and prayers.
Thank you for your continued support of SPP. We know that we are nothing without our stakeholders and very much appreciate the time and effort you all put in to making SPP the best RTO in the country.
Happy holidays, and we look forward to doing great work together in the New Year!
Barbara
There were no new operational peaks set during Q3. By comparison, the summer 2024 peak load was 54,393 MW, while the summer 2023 peak load was 56,184 MW.
SPP issued a Conservative Operations Advisory for its entire Balancing Authority (BA) on five dates: July 16, August 1, August 2, August 26 and August 27. On August 26, SPP declared an EEA Level 1 for the entire Balancing Authority area from 12:30 p.m. CT to 3:00 p.m. CT. The EEA1 was declared due to high temperatures across much of our 14-state service territory, combined with low region-wide wind output and generation and transmission outages to produce narrow margins in available generating capacity. SPP has experienced EEA1 events three times prior to August 26, 2024: on August 6, 2019; during Winter Storm Uri in February 2021; and during Winter Storm Elliot in December 2022.
The top contributors to real-time generation mix in the Integrated Marketplace in Q3 2024 were gas (33.9%), coal (29.2%), wind (28.4%), nuclear (4.9%) and hydro (3.0%).
Overall average prices between the day-ahead ($26.20/MWh in Q3) and real-time ($24.70/MWh in Q3) markets were closely aligned for Q3 2024. Prices increased due to summer load but remained stable through Q3. The average real-time price of energy in Q3 2024 was up 31% from $18.17/MWh in Q2 and up 11% from $23.24 in Q1 2024, and 33% lower than 2023’s Q3 average of $39.09.
Looking ahead, SPP conducts an assessment each year to identify and mitigate threats to energy reliability during the winter season lasting from December to March. Based on its assessment results, SPP anticipates a 98.5% probability that it will have sufficient resources to meet the projected peak demand for electricity and maintain energy reserves throughout the upcoming winter season. SPP further anticipates an even greater chance that it can meet region-wide demand with the help of reserves if needed. Read more about SPP’s confidence in meeting energy needs this winter here.
The Markets and Operations Policy Committee (MOPC) held its quarterly meeting on October 15-16. There were 22 voting items on the agenda which passed with an average approval rate of 99%.
Approved items included: Endorsement of the 2024 ITP Assessment, which includes recommended issuance, modification and withdrawal of Notifications to Construct (NTC) for projects within the four-year financial commitment window, and state projects addressing winter weather needs as those that address persistent operational needs per the staging waiver; RR651 (GI Manual Solution Process Methodology), which revises BP7250 GI Manual language to allow upgrades from other planning processes which are approved mid-study to be used as solutions for constraints identified during the DISIS study; and the Provisional Load Policy recommendation, which is a proposed provisional load process that will allow transmission customers to add load to our region using their planned generation.
The MOPC also approved RR638 (Day-Ahead Reliability Unit Commitment Self-Commitment Exemption), which removes the Self-Commit Deviation exemption and seeks to mitigate behaviors in the market where resources are intentionally switching between self-status and market-status to increase make whole payments. The committee also approved RR632 (Date Change for Attachment AA), which allows Load Responsible Entities (LRE) more time to address deficiencies in meeting their Resource Adequacy Requirement (RAR).
Other discussion items included Order 881 and Order 2222 updates, the high-voltage direct current (HVDC) Process Preview, and JTIQ and Joint Planning Process updates.
The MOPC met for a special meeting on December 3 to further evaluate the staging of two projects from the 2024 ITP Assessment: the Elm Creek–Tobias and Buffalo Flats–Delaware 345kV transmission projects. This work was completed by the Transmission Working Group (TWG) and Economic Studies Working Group (ESWG) in response to a board directive to delay the need-by date staging until the board’s December 9, 2024, meeting. The MOPC approved the Elm Creek– Tobias project to be staged as 12/1/2028 based upon the version of the tariff and ITP Manual that was used to determine current need dates as recommended by SPP staff for the 2024 ITP. They approved the Buffalo Flats–Delaware project be staged as 12/1/2025 to resolve the remaining Winter Storm Elliott Target Area Reliability Needs, consistent with SPP staff’s incremental staging approach.
The MOPC will next meet virtually January 14-15, 2025.
To get involved in SPP's stakeholder-driven process, find meeting registration, contact information and materials at the stakeholder group links below:
MOPC | DSC | ESWG | MWG | ORWG | 2222
PCWG | RARTF | RTWG | SAWG | TOSPTF | TWG
Phase one of Markets+, SPP’s proposed day-ahead western energy market, continues with SPP staff and Markets+ participants focused on developing protocol language. At their November 12 meeting, the Markets+ Participant Executive Committee (MPEC) approved 16 new protocols including GHG Tracking and Reporting, Multi-Day Forecast Analyst and Analysis Results, Day-Ahead Activities, Load Deviation Exemptions, Post Operating day and Settlement Activities, MCP Calculations, Settlement Location LMPs and LMP Components, Day-Ahead and Real-Time Balancing Market Settlement Overview, Settlement Statement Process, Market System Outages, Congestion Rent, Real-Time and Day-Ahead Must offers, Outage Scheduling and Reporting, Interchange Transactions, and more.
SPP continues to work on phase-two funding agreements with phase-one participants and other parties interested in joining Markets+ phase-two development. A revised version of the phase-two funding agreement has been shared with stakeholders. Stakeholder agreements for non-funding parties will be distributed after funding party agreements are complete.
On July 31, FERC issued a deficiency letter to SPP regarding the initial Markets+ tariff filing, requesting more information related to the Markets+ transmission construct. SPP filed its response on Sept. 20, well within the FERC-requested Sept. 30 response deadline. SPP anticipates a response in January 2025.
Markets+ participants have produced a series of issue alerts designed to inform interested parties about the Markets+ value proposition relative to other market options. SPP has launched a Markets+ Newsletter to keep participants and interested parties informed of Markets+ news and development. To automatically receive this monthly publication, log in to your SPP.org account and add the Markets+ exploder distribution list to your profile. You can also keep up with Markets+ news and resources at www.marketsplus.org.
The MPEC will next meet Jan. 21 in Phoenix, Arizona.
IMIP | MPEC | MDWG | MSWG | MTWG | MORWG
MGHGTF | MCRTF | MRATF | MRTF
Future Grid Strategy Advisory Group (FGSAG)
The Future Grid Strategy Advisory Group (FGSAG) shared a final FGSAG Report Addendum with prioritized recommendations to the Strategic Planning Committee (SPC). The addendum includes an array of recommendations including those to addresses Artificial Intelligence (AI), Grid Enhancing Technologies (GET), Load of the Future, advancement of the Future Energy Resource Needs (FERNs) study, and more, each to be incorporated into various working group plans in 2025 and beyond. The group is currently working with the Resource Energy Adequacy Leadership (REAL) Team to host a Load of the Future Symposium March 3-4, 2025, and considering significant changes to the FGSAG scope statement.
The FGSAG will next meet virtually February 17, 2025.
Leadership & Oversight
The Regional State Committee (RSC) and Board of Directors and Members Committee (BOD/MC) held their business meetings and quarterly joint stakeholder briefing October 28-29.
The RSC approved the following slate of officers for 2025: President: Pat O’Connell (NM), Vice President Chuck Hutchison (NE) and Secretary/Treasurer: Kim David (OK).
They approved Holistic Integrated Tariff Team (HITT) Recommendation C1, which decouples Schedules 9 and 11 and establishes larger Schedule 11 zones (subregions), as approved by the Cost Allocation Working Group (CAWG); and RR632-Date Change for Attachment AA, as approved by the REAL Team and CAWG. The committee continued to endorse the Seams Projects Policy Paper, and to move forward with the approved Strategic and Creative Re-engineering of Integrated Planning Team (SCRIPT) recommendation to seek FERC approval to include in the SPP Tariff.
The RSC also agreed to first steps of FERC Order 1920 compliance including serving as the SPP forum for the negotiation of any potential changes to our existing Long-Term Regional Transmission Cost Allocation Method and/or development of a new State Agreement Process for the compliance obligations on SPP under FERC order 1920.
The BOD approved RR632-Date Change for Attachment AA as approved by the RSC. They approved the 2025 SPP operating budget as presented by the Finance Committee, which includes total expenses of $296.3 million and a net revenue requirement of $204.0 million, as well as the 2025 capital budget allocation of $22.1 million.
The BOD also approved the 2024 Integrated Transmission Plan (ITP) 2024 Assessment Report portfolio of projects as developed by SPP staff and approved by the MOPC. SPP’s 2024 ITP is the single largest portfolio, in terms of size and value, that SPP has proposed for construction in its 20-year history as a transmission planning coordinator. This plan will provide a more reliable and resilient grid that plans for extreme weather conditions and facilitates generation interconnection and delivery point load additions. The plan includes 2,333 miles of new transmission and 89 new transmission projects. Read more about the $7.7 billion ITP for transmission builds and upgrades here.The BOD’s approval did not include a determination for need-by date staging for the Elm Creek-Tobias and Buffalo Flats-Delaware 345 kV projects. They delayed that decision based on a request of working groups and the MOPC to further evaluate the staging for each project.
The BOD met again on December 9 to review the MOPC’s modified recommendations regarding the Buffalo Flats–Delaware and Elm Creek-Tobias projects. They approved the Elm Creek–Tobias project to be staged as 12/1/2028 based upon the version of the tariff and ITP Manual used to determine current need dates as recommended by SPP staff for the 2024 ITP (*which was unchanged from the MOPC recommendation provided on Dec. 2). They approved the Buffalo Flats–Delaware project be staged as 12/1/2025 to resolve the remaining Winter Storm Elliott Target Area Reliability Needs, consistent with SPP staff’s incremental staging approach (which was modified by the MOPC from the recommendation provided on Dec. 2, based on further review).
Minutes from the meetings of the RSC and BOD can be found on spp.org. The RSC and BOD/Members Committee will next meet virtually February 3-4. Register for the RSC and Quarterly Joint Stakeholder Briefing meeting here, and the BOD/MC meetinghere.
The Strategic Planning Committee (SPC) met October 16 and approved the Grid of the Future Report addendum. The committee reviewed updates on Aspire 2026 initiativesincluding inter-market optimization, Department of Energy funding opportunities, 2026 ITP futures guidance, Order 1000 process improvements, and high-voltage direct current (HVDC) and seams strategy.
The committee discussed its role and how representatives can best fulfill their responsibility as stewards of the strategic plan. The committee pledged to continue this discussion at its next meeting.
The SPC will next meet virtually January 15-16, 2025.
The Corporate Governance Committee (CGC) met November 19. During its meeting it approved the following chair nominees for recommendation of appointment by the BOD (unless otherwise noted, all were subsequently approved by the BOD via Consent Agenda at its December 9 meeting):
- Markets and Operations Policy Committee (MOPC)
- Chair: Joe Lang, Omaha Public Power District
- Vice Chair: Olivia Hough, City Utilities of Springfield
- Credit Practices Working Group (CPWG)
- Chair: Caleb Head, Northeast Texas Electric Coop. (Incumbent)
- Economic Studies Working Group (ESWG)
- Chair: Calvin Daniels, Western Farmers Elec. Coop. (Incumbent)
- Project Cost Working Group (PCWG)
- Chair: Angie Anderson, Sunflower Electric Power Corp. (Incumbent)
- System Protection and Control Advisory Group (SPCAG)
- Chair: David Oswald, Liberty Utilities (New-Currently VC)
- Model Development Advisory Group (MDAG)
- Chair: John Turner, Western Farmers Electric Cooperative (Incumbent) *Prior to BOD approval, John resigned this position
- Operations Training User Forum (OTUF)
- Chair: Derek Stafford, Grand River Dam Authority (Incumbent)
- Generation Interconnection Advisory Group (GIAG)
- Chair: Jason Tanner, NextEra Energy (New - Currently VC)
- Market Working Group (MWG)
- Chair: Richard Ross, American Electric Power (Incumbent)
The committee approved revisions to the Project Cost Working Group (PCWG) scope statement to align with recent changes to Business Practice 7060 that defined the PCWGs responsibilities to review delayed upgrades and provide recommendations to the BOD in a timely manner. It also approved revisions to the Strategic Planning Committee (SPC) to add an additional BOD seat to the SPC.
The CGC also approved the rosters of the organizational groups as provided in the 2024 annual assessments.
The CGC will next meet virtually February 18, 2025.
BOD/MC | RSC | CAWG | CGC | Finance | HRC | Oversight | SPC
Adaptive Governance
SPP identified “Adaptive Governance” as an enabling capability in its ASPIRE 2026 strategic plan.
At its November 19 meeting, the CGC approved a policy that working group chairs serve up to three full two-year terms effective January 1, 2026. Terms served as of January 1, 2026, will be included in the calculation of the term limit. The CGC discussed the need for the exception policy to be applied narrowly and that it should only be granted in extraordinary circumstances. The CGC also clarified that the intent is that chairs be limited to three cumulative terms.
The committee also endorsed SPP staff implementing an improved scorecard process that includes, but is not limited to, qualifications, sector balance and geographic balance; and conduct additional training with organizational group staff secretaries.
With these final actions, the CGC approved a motion to consider the governance review conducted consistent with the Adaptive Governance enabling capability as identified in ASPIRE 2026 to be completed.
Stewardship & Value
As of October 29, SPP was forecasting the 2024 gross revenue requirement (GRR) to be $213.2 million, which was 1.9% under the GRR budget of $217.3 million.
On October 7, SPP celebrated the 20th anniversary of its designation as a regional transmission operator (RTO). SPP formed in 1941 and earned the Federal Energy Regulatory Commission’s RTO designation in October 2004. Over the last two decades, SPP has expanded from seven to 14 states; directed investment of $12.5 billion in transmission with benefit-to-cost ratios of 5-to-1 or better; launched multiple wholesale energy markets in the Eastern and Western Interconnections, which have produced more than $10 billion in cumulative savings; and reliably facilitated a tenfold increase in wind energy. Read more about the 20-year anniversary here.
Other Information
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