Arizona Public Service (APS), Salt River Project (SRP), Tucson Electric Power and UniSource Energy Services announced plans to join Southwest Power Pool’s (SPP) Markets+, a day-ahead and real-time energy market that is anticipated to span through the northwest, southwest and mountain west regions of the U.S. The new market is expected to bring enhanced reliability and savings of nearly $100 million above current market participation, passed back across the electric companies’ customers. It will also support the addition of more renewable resources to the energy grid, as Arizona continues to experience residential and business growth and record-breaking energy demand.
Along with other western utilities, Markets+ is anticipated to help the Arizona energy providers respond efficiently to market price changes and regional weather events driving energy usage, while giving them access to a larger pool of diverse generation resources. After several years of strategic planning and development, APS, SRP, TEP and UniSource expect to participate in the new market as early as 2027.
“Arizona is one of the fastest growing states in the country and we are thoughtfully planning for the future and evolving our operations to continue to provide top-tier service and reliability to our customers at an affordable cost,” said Brian Cole, APS Vice President of Resource Management. “Together with our neighboring utilities, APS plans to join Markets+ to efficiently deliver energy and bolster the resilience of our shared energy grid in Arizona and across the region.”
“SRP’s participation in SPP Markets+ is a key component of our plan to meet the growing energy needs of our customers reliably and affordably and will help us achieve our 2035 Sustainability Goals,” said Josh Robertson, SRP Director of Energy Market Strategy. “We look forward to working with utilities in the region to bring the cost and resilience benefits to our respective customers.”
“Tucson Electric Power and UniSource Energy Services are excited about the value that Markets+ can provide to our customers, including cost savings and greater access to clean energy and other resources that support affordable, reliable service,” said Erik Bakken, TEP Senior Vice President. “We look forward to strengthening an already collaborative, productive relationship with Southwest Power Pool, our reliability coordinator, in its new role as market operator.”
What is an energy market?
An energy market is an interconnected network of electricity providers that help meet the supply and demand of power across a specific geography and include transmission pathways for electricity to travel from one location to another. Through Markets+, APS, SRP, TEP and UniSource will have greater access to substantial cost-effective hydroelectric, wind and nuclear power to help meet their customers’ needs. When demand is lower, the Arizona utilities can sell energy, like excess solar power during the winter season, to maintain a balanced electric system, while also taking advantage of cost-savings opportunities.
How will Markets+ benefit Arizonans and the region?
Over the past several years, APS, SRP, TEP and UniSource actively participated in workshops and planning meetings with other western utilities to equitably develop the new market’s design. Markets+ offers participants an independent governance structure that ensures the market meets the needs of customers now and into the future and provides each utility equitable representation and voice in the process. The design is intended to offer a variety of benefits to customers, including:
Increased Reliability
- Participation standards requiring utilities to maintain specific generation levels to sustain a reliable pool of available market resources.
- Improving regional energy flows to better serve customer needs on transmission lines from the Northwest through the Mountain West and down to the Southwest.
- Efficient market structure that allows energy providers greater flexibility in meeting customers’ short-term and long-term energy needs in real time and day-ahead markets. This allows utilities to plan long-term, the next day, hourly and down to even 5-minute intervals.
Greater Cost Savings
- Greater savings for customers from more efficient utilization of generation resources.
More Clean Energy
- Expanded diversity of renewable and clean energy technologies – from solar power and battery energy storage to wind and hydropower – expected across a region from Arizona to Canada.
- Support for participating utilities’ clean energy goals by enabling better movement of clean energy from a shared pool of power plants and technologies.
- Leveraging Southwest Power Pool’s 20 years of experience as a regional transmission operator, which includes a recent, significant expansion of renewable resources.
