In March, the Bonneville Power Administration (BPA) announced that it would join a new day-ahead wholesale power market to buy and sell power for near immediate use, the result of a years-long decision process.
Now, less than a year later, new leadership has announced it will reconsider and come to a final decision by the end of the year.
A group of consumer-owned utilities in the Pacific Northwest called the Public Power Council (PPC) isn’t satisfied with the announcement.
The group, which represents the Lewis County Public Utility District, released a study and news release early last week urging BPA to stay the course.
“The status quo isn’t going to sit still while BPA continues evaluating its options,” PPC CEO and Executive Director Scott Simms said in a recent news release. “The question is whether BPA deliberately chooses a market with independent governance and rules that appropriately value Northwest resources, or misses that chance.”
Roughly six months ago, the administration made the decision to join a day-ahead power market that it had a role in developing and molding known as Markets+, which is operated by the Southwest Power Pool.
But, just last week, BPA’s newest administrator and CEO Travis Kavulla, who was sworn in back in January, announced he would reconsider that decision.
In a letter from the administrator dated Sept. 3, the CEO recognized the reasons for joining Markets+ but ultimately questioned if it was the right decision and considered joining a competing market, or simply choosing neither.
The administration will now reconsider if it would prefer to join the Extended Day-Ahead Market (EDAM) operated by the California Independent System Operator, the market that so far has had more participation and which Kavulla argues is more “seamless.”
“Before the end of the year, Bonneville intends to issue a new decision either to continue on that course, to pivot toward EDAM, to remain in its status quo, or to adopt a different approach to markets that suits Bonneville and its customers,” Kavulla wrote.
The new study from the PPC, despite being published before Kavulla’s letter, appears to comment directly on claims in the letter that the California based market would be much more profitable.
The study argues that the freedom of joining Markets+ preserves the region’s independence and will keep the region’s power more affordable for longer and refutes that EDAM poses a significant economic advantage.
“Northwest affordability is an enormous economic advantage at exactly the moment the country needs more reliable electricity to support economic growth and American competitiveness,” Simms said in the release. “We should be very careful about putting that advantage at risk.”
The group warns that any decision made will have a profound impact on their customers as they assert the utilities they represent “purchase roughly 90% of BPA’s generation through long-term contracts.”
“For the public power utilities that ultimately pay BPA’s costs, this decision has always been about much more than drawing the biggest possible market footprint on a map,” PPC Chair and Tacoma Power General Manager Chris Robinson said in the news release.
“It is about protecting affordable, reliable electricity for Northwest communities and ensuring that the federal hydropower system continues delivering value to the customers who have supported and paid for it for generations.”
For more information on the agency’s decision to reconsider its path forward, visit the Northwest Public Power Association website at https://tinyurl.com/2tzx2pyr.
