Wind Energy Integration Into Regional Markets: Market Innovation in ERCOT and what can be learned by the SPP

Abstract

As renewable generation continues to grow within the electricity sector, operators of the electrical grid are having to take a fresh look at the capabilities of the regional systems to handle these resources, as well as policies to encourage development. This is especially true for those Regional Transmission Organizations (RTOs) that cover areas possessing high levels of wind, such as the central region of the United States. The Electric Reliability Council of Texas is one of the leading RTOs in pursuing innovative market policies and operational protocols for dealing with the variability of wind generation. As the Southwest Power Pool expands into areas with additional wind resource potential, operational procedures and market policies will need to be continuously evaluated. Due to ERCOT’s leading status in the wind industry, as well as similar challenges in transmission constraints across their territories, it will be beneficial for the Southwest Power Pool to learn from ERCOT’s experiences. Not only could this maintain reliability on the SPP grid, but with the correct approach, may make the region an attractive development opportunity for new wind generation. The SPP has the opportunity to capitalize on the significant wind resource and the recent expansion to experience Power Purchase Agreements (PPA) levels beyond those in ERCOT.