The development of more wind farms and solar arrays, along with conventional unit retirements and high natural gas prices have increased volatility in the Southwest Power Pool (SPP) marketplace. While natural gas prices will continue to fluctuate, the transition from conventional resources to renewable generation will continue. Several new measures have been approved through the SPP stakeholder process to mitigate market volatility and improve reliability across the region.
We’ve summarized these new measures below to help you understand the implications for municipalities and cooperatives and prepare for upcoming changes in SPP.
Ramp Capabilities
SPP introduced ramp products to the Integrated Marketplace to systematically pre-position resources with ramp capabilities to manage net load variations and uncertainties. Ramp products serve two main purposes in SPP: reducing costs and improving reliability.
Introduction of ramp products in SPP should result in:
- Reduced system scarcity of traditional reserves.
- Reduced price spikes are often attributed to drops in wind generation.
- Slight additional cost for everyone across the market footprint but reduced overall costs.
- More transparent pricing and payment of flexibility needs.
- More efficient operation of the transmission system with less reliance on short-term or manual commitments for uncertainty.
- Increased flexibility to resolve multiple constraints.
Ramp-up products have seen non-zero pricing a significant portion of the time in both Day-Ahead and Real-Time markets, while ramp-down has seen little to no pricing activity in the same period. Increased ramp-up needs have been observed during late spring and summer months, driven by faster load swings and higher demand.
In addition, an uncertainty market product has been approved through the SPP stakeholder process and by the Federal Energy Regulatory Commission (FERC). This new product is intended to improve the management of market volatility and operational uncertainty as grid conditions become more dynamic
Increasing Reserve Margin
Regulating reserve margin is one way that SPP improves reliability by ensuring that the region always has more supply available than may be required. On July 26, 2022, the SPP Board of Directors voted to increase the reserve margin from 12% to 15% effective for the summer of 2023. The Regional State Committee had also approved the change a day earlier.
In the long run, this increase will improve power reliability and flexibility on days when wind or solar generation drops off due to weather changes or conventional units are undergoing maintenance. Power providers in SPP should plan for this increase, as the sudden increase will likely cause a short-term rush for additional capacity.
Required Winterization Plans
Your winterization plan may include:
- Date on which your company begins winterization activities.
- Physical actions taken to freeze-protect generator and substation equipment.
- Fuel assurance activities including alternate fuel source arrangements, communication plans with fuel suppliers, environmental waivers, and physical winterization actions for fuel stored on site.
- Staffing and training.
Ancillary Services
The measures mentioned above are utilized in conjunction with SPP’s ancillary services, which are required to maintain grid stability and security. These include:
- Scheduling and dispatch
- Reactive power and voltage control
- Loss compensation
- Load following
- System protection
- Energy imbalance
When used in conjunction with existing ancillary services, SPP’s new measures should help to mitigate the impact of market volatility for power providers. As more renewable sources are added to the fold, these measures aim to improve reliability and offer cost savings across the market.
As the market evolves, municipal and cooperative clients need flexible energy management solutions that account for renewables while prioritizing cost and reliability. Learn more about Evergy Energy Partners and our energy management solutions. Get in touch today!
David Shupe
John Sampler: Jun 15, 2026 3:15:00 PM
Robert Day: Jun 15, 2026 2:30:00 PM
