June 24, 2025
For decades, electricity systems in the West have functioned as a patchwork quilt of market operators. There are significant barriers between these different “patches” owned by different utilities, which can make it hard to sustain grid reliability or share power in extreme weather stressed times. Regional wholesale electricity markets and expanding transmission capacity are two tools to ensure we have reliable power for our everyday. But the energy landscape is shifting rapidly, and the Western Interconnection – our region’s electric grid – will soon enter new wholesale electricity markets. The evolving changes across states and utilities in the Interior West present significant opportunities for greater reliability and a faster transition to clean energy. At WRA, we believe one of the solutions to the energy puzzle in the West is expansion of regional wholesale electricity markets that are flexible, fair in design, and transparent in operation. This process involves several entities and concepts.
Types of Wholesale Electricity Markets
Companies whose power plants generate most of the electricity delivered to homes and businesses every day can sell that electricity on what are called wholesale markets.
Energy Imbalance Market Service
A market where participants buy or sell wholesale electricity on various intervals – some as short as five minutes – to meet a small portion of demand or sell a small surplus of electricity in real-time.
Day-Ahead Market Service
A market where participants buy or sell wholesale electricity up to one day before the operating day, maximizing efficiencies through advance planning to turn on or off generating units as needed for each day.
Regional Transmission Organization (RTO)
A wholesale market that centralizes the management of a multi-state portion of the electric grid under a single operator. Market operator responsibilities include planning and dispatching power to balance supply and demand across the market footprint. RTOs operate in much of the U.S. and Canada, but not currently in most of the West. RTOs can incentivize decarbonization, reliability, and cost benefits by coordinating across a large geographic footprint for diverse energy resources. The Federal Energy Regulatory Commission (FERC) regulates RTOs.
Western Wholesale Electricity Markets
California Independent System Operator (CAISO)
A market operator with a wholesale energy market serving 80% of California and a small part of Nevada. Created in 1998, CAISO is the only independent grid operator in the West. California legislation has been proposed to change the governance structure of CAISO so that a California-inclusive RTO could be established in the West.Regional electricity markets offer the most efficient, effective ways to meet the increasing demand for reliable, affordable, and clean energy while significantly reducing carbon emissions in the West.
Western Energy Imbalance Market (WEIM)
Launched in 2014 as the first energy imbalance market in the West. It has 22 participants representing 80% of the load in the West. It has produced $6.62 billion in gross benefits as of January 2025.
Extended Day-Ahead Market (EDAM)
FERC-approved planned day-ahead market to begin operations in the West in 2026. Current likely participants include Balancing Authority of Northern California (BANC), Berkshire Hathaway Energy (BHE) Montana, Idaho Power, Los Angeles Department of Water and Power (LADWP), Nevada Energy, PacifiCorp, Portland General Electric, and Public Service Company of New Mexico (PNM).
Southwest Power Pool (SPP)
A market operator with an RTO serving parts of 14 states in the central U.S. SPP was founded in 1941 and became an RTO in 2004. FERC approved the planned RTO expansion into the West in 2026 with the addition of some utilities primarily in Colorado and Wyoming.
Western Energy Imbalance Service (WEIS)
Launched in 2021 as an energy imbalance market, it currently has 12 participants primarily in Colorado and Wyoming. WEIS will be folded into Markets+ following its launch.
Markets Plus (Markets+)
FERC-approved planned day-ahead market to begin operations in the West in 2027. Current likely participants include Arizona Public Service (APS), Bonneville Power Administration (BPA), Chelan County Public Utility District (PUD), Grant County PUD, Powerex, Salt River Project (SRP), Tacoma Power, and Tucson Electric Power (TEP).
