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Arizona's major utilities agree to energy market plan with providers in other states

power lines
SRP

Arizona Public Service, Salt River Project, Tucson Electric Power and UniSource Energy Services are joining an energy market agreement with several other electric providers across the U.S. West. The utilities say it will keep costs affordable for customers and make energy more reliable as demand grows.

APS, SRP, TEP and UniSource already sell power to other utilities when they’re generating more than their customers need and buy additional electricity when demand is high. But those trades usually happen with about an hour’s notice.

Under new plans announced this week, the utilities will be able to buy and sell energy a day in advance.

“The benefit of doing day-ahead is to provide more notice period so that we can make sure the right resources are online that can maximize the opportunity to both buy and sell for customers,” said Kent Walter, director of Western market affairs at APS.

The plan, known as Markets+, will be managed by the regional transmission organization, Southwest Power Pool.

In addition to allowing utilities more time to prepare for peaks in demand, Walter said the plan will provide a more efficient way to pool renewable resources across different parts of the country when weather impacts demand or energy generation.

“So our solar supports those in the Northwest, their hydro and wind supports us in the Southwest,” Walter said. “We get the benefit of differences in seasonality for load, but also for weather patterns and renewable resources that are very subject to those weather patterns.”

The utilities taking part in the energy market are still developing technology to allow day-ahead trading. They expect the system to launch in 2027.

Katherine Davis-Young is a senior field correspondent reporting on a variety of issues, including public health and climate change.
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