On June 20, 2025, FERC approved Southwest Power Pool, Inc.’s (SPP) revisions to its Western Energy Imbalance Service (WEIS) tariff to allow a participating balancing authority to initiate a market hold due to reliability concerns and to specify how SPP will settle the market in the event of such a market hold. FERC found that the revisions will allow participating balancing authorities to timely respond to reliability-based events while avoiding disruptions to the WEIS market.
On February 3, 2025, SPP filed tariff revisions to formally incorporate reliability-based market holds into the WEIS tariff. Under SPP’s tariff, a market hold is a temporary suspension of market operations designed to address issues impacting the integrity, reliability, or fairness of the energy market. SPP’s proposed revisions would allow SPP to suspend dispatch instructions for settlements negotiated during the hold period. In the event of such a reliability-based market hold, the revisions direct SPP to use the last available locational marginal price to settle imbalance energy. SPP’s prior WEIS tariff was silent on reliability-based market holds and authorized this settlement procedure only in the event of “system failure.”
SPP explained that market holds had always been allowed in response to “reliability-based concerns” — e.g., unplanned outages, frequency instability, or forecasting errors. Rather than fundamentally alter the rights and responsibilities of balancing authorities, SPP maintained that the revisions would “provide a clearer mechanism for settlements during a balancing authority-initiated market hold.” The SPP Market Monitoring Unit (MMU) protested the filing, arguing that without a clear definition of “reliability-based concerns,” the revisions could obscure underlying market issues and incentivize market manipulation.
FERC accepted SPP’s proposed tariff revisions, determining that the revisions help facilitate the operation of the WEIS market by specifying that SPP, as the market operator, will suspend the calculation of dispatch instructions for certain resources if a participating balancing authority requests a market hold due to a reliability concern. FERC dismissed MMU’s concerns, concluding that SPP’s proposal appropriately reflects the responsibilities of balancing authorities under the North American Electric Reliability Corporation’s reliability standards. In light of the notification process that balancing authorities must observe when initiating a market hold, FERC remained unconvinced by MMU’s fears of market manipulation. Further, FERC found that SPP’s tariff revisions enable balancing authorities “to coordinate and timely respond to reliability-based events while avoiding significant disruptions to operation of the WEIS Market.”
FERC’s order issued in Docket No. ER25-1137-000, can be found here.
* Adam Webster is a 2025 summer associate with Troutman Pepper Locke and not admitted to practice law in any jurisdiction.