Author: Basit Mushtaq
As the U.S. power industry continues its transition towards cleaner and more flexible energy systems, regional transmission organizations (RTOs) like the Southwest Power Pool (SPP) are stepping up to offer innovative market solutions. One of the most ambitious efforts in recent years is SPP’s Markets+ initiative. Launched to create a fully voluntary day-ahead and real-time electricity market tailored for the Western Interconnection, Markets+ represents a significant shift toward enhanced grid coordination, cost-efficiency, and decarbonization across the Western U.S. This article provides a comprehensive overview of Markets+, including its origin, structure, participating entities, anticipated benefits, governance model, and current development status.
Background: The Need for a Western Market
The Western Interconnection has historically lacked a unified market structure, with many utilities operating in isolated or bilateral trading arrangements. This fragmentation has led to inefficiencies in electricity dispatch, transmission usage, and integration of renewable energy resources. To address these gaps, SPP launched the Western Energy Imbalance Service (WEIS) in 2021, which offered real-time balancing services. Building on WEIS, the Markets+ initiative seeks to expand into the day-ahead market domain and offer a broader suite of services1.
Markets+ is distinct from a traditional RTO model. It is fully voluntary and does not require participants to join SPP’s existing RTO footprint. Instead, it is designed to allow utilities and transmission providers in the Western Interconnection to access day-ahead energy trading, congestion management, resource adequacy support, and more.
Markets+
Markets+ is more than just a day-ahead market offering. It’s a conceptual bundle of services proposed by SPP that would centralize day-ahead and real-time unit commitment and dispatch and pave the way for the reliable integration of a rapidly growing fleet of renewable generation. It provides:
- Day-Ahead Market Services: Optimized unit commitment and dispatch based on security-constrained unit commitment (SCUC) and security-constrained economic dispatch (SCED) models.
- Real-Time Balancing: Integrated with or complementary to existing services like WEIS.
- Congestion Management: More efficient use of transmission through congestion pricing and redispatch mechanisms.
- Resource Adequacy Coordination: Facilitating compliance with RA obligations.
- Ancillary Services Procurement: Frequency regulation, spinning reserves, etc.
Key Features:
- Voluntary Participation: Entities can opt in without joining the SPP RTO.
- Independent Governance: Decisions are made with input from a range of Western stakeholders.
- Market Optimization: Employs advanced forecasting and modelling techniques for real-time and day-ahead operations.
Source: SPP
Markets+ is engineered to function across multiple balancing areas while offering flexibility and transparency to both investor-owned and publicly owned utilities2.
Regulatory Milestones and Market Design Approval
In January 2025, the Federal Energy Regulatory Commission (FERC) approved the initial Markets+ tariff, validating the proposed market rules and operations. In April 2025, FERC approved the Phase 2 Funding Agreement, between SPP and eight Western entities. The $150 million in implementation costs will be financed by SPP and recovered throughout the market operations of Markets+. SPP will obtain the funds to set up “systems, processes and operations necessary” for implementing Markets+ in the Western Interconnection3.
Unlike SPP’s traditional RTO membership, Markets+ allows western entities to retain local control over their transmission and resource planning while participating in centralized market operations. The governance remains collaborative, with technical and policy committees offering a voice to state regulators and utilities alike.
Governance and Stakeholder Involvement
Unlike CAISO’s Extended Day-Ahead Market (EDAM), which operates under California’s regulatory jurisdiction, SPP Markets+ offers a separate governance structure that allows greater regional stakeholder involvement. Markets+ is governed through a novel stakeholder-driven structure that includes4:
Markets+ Independent Panel (MIP): A five-member panel that is independent from Markets+ participants and Markets+ stakeholders. The MIP is the highest level of authority for decisions related to the Markets+ market with the SPP board of directors providing independent oversight.
Its chief objective is to assess and act upon recommendations from the Markets+ Participant Executive Committee (MPEC).
Markets+ State Committee (MSC): The MSC works to effectively engage state members in the development and operation of the market and to provide direction and input to the Markets+ Independent Panel (MIP), Markets+ Participant Executive Committee (MPEC), and any working group or task force on pertinent market matters such as initiative prioritization, market operations, and policy issues.
Markets+ Participant Executive Committee (MPEC): MPEC features representation from a geographically diverse range of Markets+ participants in the West. MPEC oversees working groups established to explore issues such as tariff language and market design, seams management, grid reliability and more.
Working Groups: Such as the Markets+ Transmission Working Group (MTWG) and Markets+ Implementation Task Force (MITF).
This multi-layered governance model is designed to ensure transparency, regional representation, and alignment with Western market needs. In addition, the Voting rights are extended to the following Markets+ participants and stakeholders:
- Investor-owned and consumer-owned utilities
- Independent power producers
- Trade groups
- Public interest organizations
- Non-governmental organizations
Participants in Markets+ – As of 2025, several key Western utilities and organizations have committed to Phase Two of Markets+ development:
- Arizona Public Service (APS)
- Bonneville Power Administration (BPA)
- Chelan County PUD
- Grant County PUD
- Powerex Corp.
- Salt River Project (SRP)
- Tacoma Power
- Tucson Electric Power (TEP)
Source: SPP
These entities collectively serve over 216,000,000 MWh annually and cover a vast geographic area across the Pacific Northwest, Desert Southwest, and Mountain West regions of the Western Interconnection.
Other stakeholders involved in early design include Interwest Energy Alliance, NW Energy Coalition, Public Generating Pool Energy, and advocacy groups like the Sierra Club and Western Resource Advocates etc.
Timeline and Development Phases – The Markets+ development has occurred over multiple stages:
- 2021: Launch of WEIS, SPP’s real-time market for Western entities.
- 2022–2023: Stakeholder engagement, concept design, and initial modeling.
- 2024: Filing of Markets+ tariff with FERC.
- 2025: Phase Two development confirmed; implementation planning under way.
- 2026+: Potential market go-live pending regulatory approvals and system readiness.
Benefits and Strategic Value – Markets+ is expected to deliver a wide array of benefits to the western grid which include:
- Operational Efficiency: Lower production costs, increased market competition and fair and equitable tariffs will return economic benefits to Markets+ participants. For perspective, current participants in SPP’s Western Energy Imbalance Service (WEIS) program realized savings of $1.35 per 1,000 kilowatt-hours and a total of $31.7 million in net benefits in 2022.
- Renewable Integration: Better coordination of variable generation.
- Transmission Utilization: Enhances the economic use of available capacity and supports efficient congestion relief.
- Decarbonization Support: By enabling broader access to clean energy, Markets+ aligns with state-level climate goals.
- Transparency and Equity: Ensures all participants have access to market benefits without mandatory RTO membership.
According to SPP estimates, similar market models have historically delivered net benefits exceeding hundreds of millions annually in cost savings5.
Challenges and Considerations
- Regulatory Coordination: Coordinating across multiple state jurisdictions and aligning with FERC oversight.
- Resource Adequacy Standards: Managing different regional RA standards.
- Transmission Rights Compatibility: Reconciling existing firm rights and transmission ownership structures.
- Market Seam Management: Managing interoperability with neighboring markets like CAISO’s Western Energy Imbalance Market (WEIM).
Conclusion
SPP’s Markets+ initiative represents a transformative step in the evolution of energy markets in the western U.S- it represents a thoughtful, collaborative approach to addressing the structural inefficiencies in the Western Interconnection. With a transparent governance structure, voluntary participation and a design centered on stakeholder input, Markets+ promises to deliver cost savings, reliability enhancements and better integration of clean energy resources.
As the initiative moves toward full implementation by 2027, continued engagement from utilities, regulators, and public stakeholders will be crucial. Markets+ may soon become a cornerstone of a more integrated, reliable, and sustainable Western grid.
At ZEG, we specialize in supporting transmission developers and energy stakeholders with deep expertise in interconnection strategy, load forecasting, and grid modeling. If you’re looking to optimize your projects within SPP, contact our team for tailored advisory services that move your development forward.
References
1. Markets+ A Proposal for Southwest Power Pool’s Western Day-Ahead Marke and Related Services, https://www.spp.org/documents/69346/spp%20markets%20plus%20proposal.pdf
2. Markets+, https://www.marketsplus.org/about
3. Southwest Power Pool Markets+ Funding Agreement, Funding Mechanism Receive FERC Approval,https://www.publicpower.org/periodical/article/southwest-power-pool-markets-funding-agreement-funding-mechanism-receive-ferc-approval.
4. SPP’s independent and inclusive Markets+ governance model allows diverse voices to drive western market development,https://www.spp.org/news-list/spp-s-independent-and-inclusive-marketsplus-governance-model-allows-diverse-voices-to-drive-western-market-development/.
5. How will Markets+ benefit Stakeholders, https://southwestpowerpool.s3.amazonaws.com/newsstories/Markets.pdf a comprehensive view of future grid needs—supporting better planning, reliability, and long-term investment. As the grid faces increasing complexity from emerging technologies and large flexible loads, trusted insight is more critical than ever.
