Benefits of joining an RTO
Tri-State has announced significant goals for emission reductions and renewable energy additions, all while reducing our wholesale rates and keeping power reliable.
Central to meeting our goals is participation in a Regional Transmission Organization (RTO) in our region of the West that will help efficiently and cost-effectively provide much needed regional transmission infrastructure and an organized market to integrate more renewables and transmission onto the grid.
RTOs coordinate participant utilities’ and power providers electricity generation and transmission on a regional basis, which increases efficiencies and lowers costs for utilities and, by extension, their consumers.
There is a growing consensus in the Rocky Mountain region that joining or forming a regional transmission organization (RTO) is imperative to achieve an efficient, cost-effective and reliable transition to a clean grid.
Tri-State has always worked closely with our neighboring utilities to both plan and construct new transmission infrastructure and to explore organized markets. We are also participating in two energy imbalance markets that help reduce costs and increase reliability.
Now, as we move ahead with integrating more renewables and reducing member rates as part of our Responsible Energy Plan, it is imperative that we, and our region, join an RTO in the Western Grid to make serious strides toward the transition goals we, neighboring utilities and policymakers have set.
Tri-State currently participates in two imbalance markets: California Independent System Operator’s (CAISO) Western Energy Imbalance Market (WEIM) and Southwest Power Pool’s (SPP) Western Energy Imbalance Service (WEIS) market. Imbalance markets can be an initial step to a full RTO, not an end, because the economic and reliability benefits of an RTO are much greater. What’s more, the gap between those EIM and RTO benefits broadens rapidly over time as the need for more regional transmission grows, significant renewable resources are added, and traditional thermal generation is retired.
Important benefits of western RTOs include:
- An organized “Day 2” market (real-time, day-ahead, ancillary services) over a larger footprint – key to integrating both large scale and distributed renewable resources.
- Regional transmission planning and cost allocation to provide for much needed new regional transmission infrastructure - key to integrating new renewable resources, key to a low cost, efficient organized market.
- A common tariff that applies the same rules across the entire footprint, eliminating pancaked rates and losses, and offering common generation interconnection standards and processes.
- Increased value of abundant western solar and eastern wind by connecting those regions through the central Rocky Mountain region
Since these benefits are so important to a timely and cost-effective energy transition, Tri-State has taken the next step toward an RTO and signed a letter of intent to evaluate potential participation in a western extension of Southwest Power Pool’s regional transmission organization (RTO). Other regional power suppliers – Basin Electric Power Cooperative, Deseret Power Electric Cooperative, Municipal Energy Agency of Nebraska (MEAN), and Western Area Power Administration (WAPA) – have signed similar letters with SPP.
Taking these steps toward a western RTO now should help provide a framework Tri-State and other electricity providers in the region can secure reliable, affordable electricity while transitioning to a clean grid in a rapid, cost-effective and efficient manner, creating a brighter future for tomorrow.