The integration of Markets+ with the Western Resource Adequacy Program (WRAP) would be among a handful of key reliability benefits of SPP’s Western day-ahead offering, according to an “issue alert” published Aug. 13 by 10 entities that backed development of the market.

The alert, sent to the Markets+ States Committee (MSC) on Aug. 13, is the second in a series of seven such notices intended to highlight the purported advantages of Markets+ over CAISO’s Extended Day-Ahead Market (EDAM) and Western Energy Imbalance Market (WEIM). The first covered differences between how the two markets would be governed. (See Governance is ‘Key Consideration’ for West, Markets+ Backers Say.)

The Markets+ Phase 1 Funding Parties include Arizona Public Service, Powerex, Public Service Co. of Colorado, Salt River Project, Tacoma Power, Tri-State Generation and Transmission Association, Tucson Electric Power, and the Chelan, Grant and Snohomish public utility districts of Washington state. The alerts aren’t vetted by the MSC and don’t represent the positions of the committee or of the staff for the Western Interstate Energy Board, which hosts both the MSC and the WEIM’s Body of State Regulators.

“Market design elements that support electric system reliability must be considered prior to joining a market, as reliable service is not only expected by consumers; it is also essential to the safety and wellbeing of the general public,” the alert said. “As evidenced by the impact of extreme weather events over the past several years, reliability risk is elevated.”

The alert contends Markets+ will address that risk because its “robust, stakeholder-driven governance framework” produced a market design with a “strong focus” on reliability. The parties to the notice also point out SPP has a “long track record” as a reliability coordinator in both the Eastern and Western interconnections and through operation of the SPP RTO and Western Energy Imbalance Service (WEIS).

But the integration of Markets+ with the Western Power Pool’s (WPP) WRAP, which SPP operates on behalf of the WPP, gets top billing in the alert. Under the Markets+ tariff, market participants must join the program “because a common and rigorous resource adequacy structure is foundational to reliability and critical to achieving equitable outcomes within a market footprint,” according to the alert.

“WRAP applies a common approach for calculating resource capacity values and determining each participant’s minimum obligation for resource adequacy, which, in the context of Markets+, will prevent market participants from being over-reliant on others’ resources,” the parties wrote, adding that the arrangement will ensure that capacity obligations — and the benefits of regional diversity — are “distributed equitably.”

The parties also contend the WRAP component of Markets+ will provide visibility into how various resources perform during critical hours “in a way that does not currently exist” and enforce resource deliverability requirements that will incentivize development of new transmission, “supporting reliable service to customers and the efficient integration of clean energy resources.”

The alert further said Markets+ “builds upon” WRAP’s forward resource procurement requirement — an explicit commitment to make resources available during a specific time frame — that ensures the market has sufficient generation on hand during real-time intervals through use of a must-offer requirement that can only be satisfied by WRAP supply or other “specified resources.”

“This approach improves reliability in the West by addressing those instances where historically some energy commitments have not been backed by reliable physical supply (and ultimately did not deliver to load),” the alert said.

The WRAP originally was scheduled to begin its “binding” penalty phase in summer 2026, but this spring program stakeholders requested that step be delayed until summer 2027, saying supply chain delays, rapid growth in regional peak load and extreme weather events affect participants’ ability to procure enough capacity to meet RA requirements. (See WRAP ‘Binding’ Phase Delay Finds Stakeholder Support.)

‘Fundamentally Different’

Non-California participants in CAISO’s WEIM and EDAM are not required to participate in a resource adequacy program, but California utilities are subject to one overseen by the state’s Public Utilities Commission. To prevent participants from leaning too heavily on the WEIM/EDAM to meet forecasted demand, CAISO instead administers a resource sufficiency evaluation ahead of each market interval to gauge whether each member is prepared to cover expectations for that interval.

The alert singles out that practice for particular criticism.

“Resource sufficiency tests applied in the operating time frame without the underpinning of a common resource adequacy program are inherently challenging for several reasons,” the alert contended. “These reasons include challenges in accurately applying such a test, insufficient failure consequences to prevent deliberate leaning and insufficient notice of a deficiency due to the late timing of the test.”

The alert called the tests “flawed,” saying there have been “numerous examples of inaccurate outcomes” stemming from differing treatment between WEIM balancing authority areas and the CAISO BAA, although no specific examples were cited.

“This experience has reduced some stakeholders’ confidence that an accurate resource sufficiency test will be applied in the day-ahead time frame for the Extended Day-Ahead Market,” the parties to the alert wrote.

The alert additionally criticizes the WEIM/EDAM approach for resulting in “inadequate consequences.”

“Regardless of whether a resource sufficiency test is applied accurately, a standalone resource sufficiency test does not provide adequate time to resolve supply deficiencies that may be identified,” it said. “As a consequence, such a test necessarily relies on failure consequences that are known ahead of time to create incentives for participants to procure sufficient supply in advance to avoid failing.”

The alert also argues that the lack of a common RA framework in the WEIM/EDAM could reduce liquidity in the day-ahead market because participants might hold back supply “in order to manage unforeseen risks in their individual areas through real-time operations.”

“Such voluntary holdback actions for local reliability further diminish available resources in the market, diminishing the market’s overall reliability and efficiency,” it said.

The alert also cautions that utilities participating in both the WRAP and WEIM/EDAM could incur additional costs for having to meet two “unlinked” requirements: the WRAP’s forward-showing obligation and WEIM’s sufficiency test.

“Ensuring reliability is an essential priority that Markets+ and EDAM seek to address in fundamentally different ways, resulting in material differences in the reliability risk that will prevail in each market,” the alert said.