Colorado Utilities Aim to Join Southwest Power Pool’s Energy Imbalance Market

Xcel Energy-Colorado, Platte River Power Authority, and Black Hills Colorado Electric LLC on Jan. 25 revealed plans to join the Western Energy Imbalances Service (WEIS) Market, operated by the Southwest Power Pool, which manages the power grid across the central U.S. The utilities plan to join the market by April 2023 subject to approval through appropriate regulatory processes. By joining the imbalance service, the utilities reinforce their commitment to evaluating a longer term and broader provincial market structure that will ensure system security of supply and enhance the incorporation of renewable generation into the system.

The real-time market allows energy generation from numerous power producers to be dispatched at the least viable cost to consistently distribute customer demand in the region. The WEIS allows the utilities to provide cost advantages to customers and improve operational efficiencies, since it takes advantage of the reduction in renewable generation variability that is realized via the geographic diversity inherent across a broad area.

Xcel Energy – Colorado at present works under a joint dispatch agreement that allows sharing energy between Platte River Power Authority, Black Hills, and Colorado Springs Utilities within its Balancing Authority Area. Before joining the WEIS, operated by the SPP, the utilities investigated membership in the Western Energy Imbalance Market (WEIM) launched by the California Independent System Operator in 2014. The utilities, after analysing the California grid operator’s energy imbalance market, decided that the most viable interim option is to participate in the WEIS given the geographic diversification and existing interconnections across the region. The utility’s membership will replace the aforementioned agreement, and is projected to provide customers with additional production cost savings.

In October 2021, the three utilities also participated In the Western Markets Exploratory Group, in order to explore options to lower costs, increase security of supply and aid the promotion of their strategies to facilitate progress towards a carbon free power system.