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SPP’s Order 2222 proposal is taking too long

SPP’s Order 2222 proposal is taking too long
SPP Coordination Center (Courtesy: SPP)

SPP’s initial compliance proposal for FERC’s Order 2222 differed significantly from those of MISO and PJM, opting to use existing resource types and not permitting multi-nodal aggregation.

Despite requesting a favorable implementation date of Q3 2025, FERC took nearly two years to respond, eventually directing SPP to make substantial revisions. In response, SPP has sought multiple extensions and continues to provide updates through various stakeholder committees, yet progress remains slow and fragmented. Stakeholders face challenges in navigating SPP’s opaque and dispersed implementation process.

SPP’s First Order 2222 proposal

In April 2022, when SPP submitted its first compliance proposal to FERC for Order 2222, it took a different approach than MISO. Unlike MISO, SPP did not propose a new market participation model nor did it request a distant implementation date in 2030. SPP suggested that DER providers use one of the existing valid Resource Types to meet Order 2222 requirements. However, SPP did not permit multi-nodal aggregation, a significant benefit for aggregators and DER providers under Order 2222, compared to previous orders (719, 745) and the energy storage order (841).

The proposal required aggregators to obtain multiple attestations from Load Resource Entities (LREs) and state regulatory authorities. In contrast to MISO and PJM, SPP did not submit any accompanying testimony with its compliance proposal to FERC. Overall, SPP’s initial compliance proposal for Order 2222 was minimal compared to those of MISO and PJM. A positive aspect of SPP’s proposal was the request for a Q3 2025 implementation, contingent on FERC issuing an order by December 31, 2022, without significant changes. This 2025 date was more favorable compared to MISO’s 2030 timeline.

FERC’s decision on SPP’s first proposal

FERC took nearly two years to respond to SPP’s initial compliance filing, finally issuing a decision on March 1, 2024. As anticipated, FERC directed SPP to submit another compliance filing within 60 days to address the “does not comply with” and “partially complies with” directives. It was expected that after FERC’s March 2024 decision, SPP would seek a time extension to comply with the requirements since SPP had much work to do, and 60 days was not enough.

However, unlike MISO and PJM, SPP did not restart the Order 2222 task force meetings. Instead, SPP continues to provide updates with presentations at the Markets Working Group, and the Markets and Operations Policy Committee (MOPC). Also unique to SPP’s response to FERC’s direction on Order 2222 is that SPP has never engaged the state regulatory staff in a workshop to discuss the coordination requirements with state regulators. Before putting together the initial proposal, SPP had initiated workshops with Electric Distribution Companies like MISO and PJM, but after FERC’s decision in March, there are no workshops scheduled yet either with EDCs or state regulators.

Multiple extension requests from SPP

Following FERC’s March 2024 decision, SPP adopted a strategy of requesting multiple extensions of time from FERC rather than a single extension. Both MISO and PJM have requested a time extension after FERC sent back their initial compliance proposals, but SPP seeking an extension is a whole new level. For instance, SPP’s response to FERC’s March 1 decision was due in 60 days, making the deadline April 30. However, SPP requested an extension until August 28, 2024, which FERC granted.

SPP filed an additional extension of time request, asking FERC for a 120-day extension. This request was also granted by FERC, making the due date for SPP’s revised proposal December 26, 2024. This is SPP’s second extension request. I hope there won’t be a third extension request. In the meanwhile, SPP is filing informational reports at FERC telling the same thing it is communicating in presentations that SPP is working on a multi-nodal aggregation proposal.

Stakeholder process on multi-nodal aggregation

Unlike MISO and PJM, SPP has not designated a single task force or working group for Order 2222 implementation. Instead, SPP’s staff presentations are dispersed across various stakeholder committees. It is very confusing which stakeholder group is discussing the multi-nodal aggregation topic, for example. Another perplexing issue is that SPP sometimes does joint stakeholder groups. For example, on July 24, SPP’s Markets Working Group will be jointly discussing the multi-nodal topic with the Operating Reliability Working Group.

What is known at this stage on multi-nodal aggregation is that SPP is actively looking at two options, none of which look particularly appealing to aggregators. In the first option, SPP is limiting multi-nodal capability to pre-determined pockets of similar nodes and allowing aggregations only in those pre-determined pockets. In the second option, SPP is proposing a system-wide limit of 56 MW, which SPP says will be the sum of all multi-nodal aggregations across all market participants because it should not exceed 0.1% of SPP’s all-time peak demand.  None of these options meet the FERC multi-nodal requirement of “geographically broad as technically feasible.”

Stakeholders have limited influence within SPP’s opaque process. The fragmented approach, with multiple committee meetings, adds to the complexity and burden. In addition to the multi-nodal issue, which is a major issue and SPP is right to focus on, there are other issues with SPP’s initial proposal, but we don’t know where SPP stands with those. Only the next few months will tell how SPP is planning to meet FERC’s requirements on Order 2222. So far, other than seeking an extension of time from FERC, SPP’s progress has not been much to speak of in terms of advancing the objectives of FERC Order 2222.

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