Four major Arizona utilities have recently decided to join the Southwest Power Pool’s (SPP) Markets+, a forthcoming energy market set to launch in 2027. This strategic decision is not only projected to enhance the reliability of the electrical grid but also to deliver nearly $100 million in savings beyond existing market conditions. As the demand for reliable and affordable energy continues to grow among Arizona’s residential and business sectors, the utilities’ participation in Markets+ marks a significant step towards accommodating this increasing demand through enhanced operational efficiency and the integration of renewable energy resources.
Commitment to Energy Reliability and Savings
Arizona Utilities’ Participation in Markets+
Arizona Public Service (APS), Salt River Project (SRP), Tucson Electric Power, and UniSource Energy Services have committed to joining Markets+, aiming to create a more efficient and resilient energy grid. APS Vice President Brian Cole emphasized that the collaboration within Markets+ would bring unprecedented efficiency and resilience, aligning with the utilities’ commitment to providing affordable energy for their customers. This initiative promises to not only stabilize energy prices but also enhance the reliability of the energy supply, thus addressing some of the pressing challenges faced by the state’s energy sector.
Similarly, SRP’s Director of Energy Market Strategy, Josh Robertson, highlighted Markets+ as essential for meeting the growing energy needs of their customers. The move to join Markets+ is seen as a proactive approach to maximizing grid transparency and operational efficiency. By integrating with Markets+, the utilities are taking a forward-thinking approach to ensure that the modern grid can meet future demands and incorporate a significant amount of renewable energy sources. This is especially critical given the increasing emphasis on sustainable energy solutions to combat climate change and reduce carbon footprints.
Markets+ Development and Competition
SPP’s Markets+ and CAISO’s Extended Day-Ahead Market
Markets+ builds on the foundation laid by SPP’s Western Energy Imbalance Services market, which was launched in 2021. Unlike its predecessor, Markets+ aims for larger-scale cooperation and integration among participating entities. A detailed 600-page tariff for this new market was submitted to the Federal Energy Regulatory Commission (FERC) in March 2024. This submission is a crucial step towards the launch of Markets+ as it outlines comprehensive guidelines for its operation. A second implementation phase, which includes integrating the necessary software and hardware, is still pending FERC’s approval.
However, the journey towards Markets+ is not without competition. The California Independent System Operator (CAISO) introduced its extended day-ahead market, which is set to commence in 2026. This means Markets+ will face direct competition not only in terms of technology and operational efficiency but also in attracting participants. Public Service Co. of New Mexico, for example, has already committed to CAISO. However, there are environmental and operational concerns regarding the “seams” between the Markets+ and CAISO markets. These boundaries could create operational challenges and inefficiencies that may need to be addressed to ensure seamless integration and optimal performance.
Regulatory and Environmental Considerations
Approval and Operational Readiness
The proactive involvement of these utilities in Markets+ demonstrates a strong commitment to a sustainable energy future, ultimately benefiting both consumers and the broader energy landscape. Four major Arizona utilities have recently decided to join the Southwest Power Pool’s (SPP) Markets+, an emerging energy market anticipated to launch in 2027. This strategic move is expected to boost the reliability of the electrical grid and potentially deliver nearly $100 million in savings beyond current market conditions. As the demand for dependable and affordable energy increases among both residential and business sectors in Arizona, the utilities’ participation in Markets+ signifies a crucial step toward meeting this growing demand. By enhancing operational efficiency and integrating renewable energy resources, the initiative aims to address the increasing energy consumption expectations effectively. This decision underscores the need for innovative solutions to manage energy resources more effectively and ensures that Arizona remains at the forefront of energy management practices.
