On February 3, 2017, FERC accepted Southwest Power Pool, Inc’s. (“SPP”) proposal to modify its Open Access Transmission Tariff (“Tariff”) to permit combined cycle resources to register as Multi-Configuration Resources (“MCR”) in its Integrated Marketplace. FERC accepted the modifications subject to SPP submitting a compliance filing to provide further clarification and refinement to address certain areas of ambiguity in SPP’s proposed tariff language.
MCRs are combined-cycle gas facilities that can produce power using multiple components and operating configurations with different characteristics. SPP’s current Tariff does not permit an MCR to register and offer its generation on the basis of such multiple operating configurations. According to SPP, its proposed Tariff modifications expand MCRs’ offerings in the Integrated Marketplace and provide additional flexibility for such MCRs in SPP’s commitment and dispatch process.
SPP proposed to modify the provisions of its Tariff that govern modeling, commitment and settlement of MCRs. Specifically, SPP proposed: to define and identify MCRs as a resource type within the Integrated Marketplace; to establish a registration process and valid configurations, and transitions between configurations, for MCRs; to establish offer parameters; to restrict regulation up or regulation down service for MCRs; and to revise contingency and operating reserve development procedures. With respect to the settlement process, SPP proposed modifications to the determinations of make-whole payments, out-of-merit energy amounts, reliability unit commitment make whole payments, and other settlement provisions. Additionally, SPP proposed to apply market mitigation procedures to MCRs, including to transition state offers of an MCR.
In accepting SPP’s proposal, FERC found that “modify[ing] the procedures by which SPP models, commits, and settles combined cycle resources that elect to register as MCRs within SPP’s Integrated Marketplace will more accurately model the operating characteristics of these resources and will therefore benefit market efficiency.” As to settlement procedures, FERC found that the proposed modifications would benefit market efficiency by “more accurately reflect[ing] commitment optimization and cost causation principles in cost recovery.”
Notably, FERC directed SPP to submit a compliance filing to clarify certain areas of ambiguity related to issues of physical withholding by MCRs.
The Order Accepting Tariff Revisions can be found here.