Southwest Power Pool raises the planning reserve margin for utilities

Southwest Power Pool (SPP) approved increases to the planning reserve margins (PRM) that its member utilities are required to maintain to support grid reliability.

The power reserve margin is the amount of back-up power utilities must have to guard against unplanned conditions or events on the regional power grid.

By increasing the margin, SPP officials said it will help the region prepare for extreme weather events and other circumstances that lead to higher-than-usual demand for electricity. These extreme events have become increasingly common in recent years, including Winter Storm Uri in 2021 and Winter Storm Elliott in 2022.

SPP’s Regional State Committee and board approved minimum requirements of a 36 percent winter-season PRM and a 16 percent summer-season PRM, effective summer 2026 and winter 2026/2027.

This means that load responsible entities in SPP’s region must have enough generating capacity to serve their peak consumption with at least 36 percent margin during the winter and at least 16 percent margin during the summer.

“As the real-time grid operator and transmission planner for a 14-state region, our job is to ensure electric reliability for millions of consumers. We’ve been successfully doing this work since 1941. But we can’t do it alone. A concerted, collective effort is needed to ensure we have a reliable power grid today and in the future,” SPP CEO Barbara Sugg said.

This marks the first time that a winter PRM requirement has been defined separately from a summer PRM requirement.

The current margin is 15 percent for both winter and summer. The new requirements support SPP’s efforts to meet the region-wide demand for electricity from residents, commercial centers and industries throughout the SPP footprint.

Sugg said that SPP is increasingly forced to issue grid advisories in winter and summer due to the heightened risk of inadequate power supplies during those times.

“Demand for electricity is outpacing supply from our generation fleet,” Sugg said. “While SPP always focuses on affordability, we need continued investment to add the generating and transmission facilities needed to mitigate risks and keep the lights on.”

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