Hydro giant shakes up Western grid market plans

Source: By Jason Plautz, E&E News • Posted: Sunday, April 7, 2024

Members of the Bonneville Power Administration’s staff are leaning toward a plan that doesn’t align with California.

A coordination center for the Arkansas-based Southwest Power Pool.

A coordination center for the Arkansas-based Southwest Power Pool. Southwest Power Pool

Staff of the largest electricity supplier in the Pacific Northwest shook up Western power market discussions Thursday by recommending a plan led by an Arkansas-based grid operator rather than one out of California.

In a new report, staffers from the Bonneville Power Administration said that joining the proposed Markets+ program from the Southwest Power Pool would give it the best chance to improve reliability, lower costs and share renewable resources across multiple states.

BPA’s push to join SPP comes against the advice of two Democratic governors and some environmental advocacy groups, who said the move could fragment a potential Western electricity market. A decision to spurn the California market, they said, means the power provider risks missing out on sharing valuable solar energy resources while reducing the potential for utilities to gain the full carbon reduction and economic benefits of a robust multistate market.

In the recommendation, BPA staff members said governance concerns, along with how the markets would deal with greenhouse gas emissions for states that have carbon markets, were key to their decision to lean toward SPP’s market rather than one being developed by the California Independent System Operator. Markets+, staff wrote, has “developed a structure and process that is more likely to result in equitable market outcomes and fair consideration of Bonneville’s interests.”