By Pete Danko – Staff Reporter, Portland Business Journal
Mar 7, 2025
Bonneville Power Administration intends to join the new energy market Markets+, the federal agency said Thursday, a decision with potentially significant energy cost and reliability ramifications that has divided utilities and other industry stakeholders in the Pacific Northwest.
The draft decision by the region's biggest power player was in line with a policy direction laid out nearly a year ago. Yet it came amid rising pressure to hold off on a commitment, if not opt for a rival market supported by Oregon's two largest utilities, Portland General Electric and PacifiCorp, and many renewable energy and climate advocates.
Oregon's and Washington's U.S. senators had joined in calls for BPA to delay action.
"This hasty draft decision by the BPA is not good news for electricity consumers in Oregon and the Pacific Northwest,” Oregon Sen. Ron Wyden said Thursday in an emailed statement.
BPA's release of a two-page cover letter and 93-page draft policy paper opened a 30-day comment period ahead of a planned final policy declaration in May.
"This draft policy is consistent with Bonneville's strategic goals, day-ahead market evaluation principles, and the Trump Administration's energy directives," John Hairston, BPA's administration and CEO, said in the letter.
For nearly two years, utilities and other electricity providers throughout the West have been weighing two "day-ahead" energy market proposals: Markets+ from the Southwest Power Pool based in Arksansas, and the Extended Day-Ahead Market, or EDAM, that California's grid operator is developing.
Each has promised efficient and robust energy trading that could help in addressing the challenges of grid congestion, reliability in the face of extreme weather events, rising rates and demand, and decarbonization.
"As the region evolves, this draft policy reflects BPA's best opportunity to remain competitively positioned in the long-term to continue meeting firm power sales obligations and marketing surplus to maintain low rates for customers," Rachel Dibble, BPA Power Services vice president of bulk marketing, said in a written statement.
BPA's direction is key not only because it sells power from 31 federal dams and a nuclear plant, but it owns and manages 75% of the region's high-voltage transmission system.
Its tilt toward the Markets+ has been widely — though not unanimously — supported by consumer-owned utilities, who have first dibs on its relatively inexpensive hydropower. A key factor in their preference has been concern that EDAM's governance structure would give California politicians undue influence, putting BPA's market standing at risk.
The agency has stood by its position through two new rounds of analysis that found that an EDAM with BPA in it would deliver greater economic benefits to BPA and the region, possibly amounting to as much as $4.4 billion over the next decade.
EDAM advocates had called on BPA to hold off on a decision while California lawmakers consider legislation that could solve the governance issue. BPA's precarious staffing situation in the wake of Trump administration actions brought new urgency to their calls.
'Tumult inflicted by Donald Trump and Elon Musk'
"The needless tumult inflicted on BPA by Donald Trump and Elon Musk, along with the uncertain outcome of potential changes to the California Independent System Operator add up to serious questions BPA must answer with transparency before issuing its final market decision," Wyden, the Oregon Democrat, said. "Foremost in that decision come May is the need for an electricity market that serves everyone in the Pacific Northwest and keeps reliability and electricity prices at the forefront."
BPA officials, in a news conference Thursday afternoon, said they had waited years for changes to the California system operator's governance and didn't want to be forced into a corner as other utilities made market choices.
"The longer BPA waits, the more the opportunity to chart our own course closes," Dibble said.
She also emphasized the governance advantages the agency sees in Markets+.
"Those are qualitative elements that we hold as very high priorities," Dibble said. "We do believe in the long run they will result in positive, quantitative benefits ... because we will have a seat at the table and be able to work, to collaborate, with partners on those future design elements."
The Public Power Council, which represents consumer-owned utilities, encouraged utilities to rally around the BPA decision and Markets+.
"With many utilities across the Northwest and Southwest already supporting Markets+, this decision signals even greater momentum toward a broad and well-structured market that delivers reliability and cost benefits," Scott Simms, the group's CEO and executive director, said via email. "We encourage additional utilities to consider joining this effort to further enhance regional coordination and market efficiencies."
Many energy players, though, see EDAM — bringing in the massive California energy market — as the only possibility for achieving the broadest and most beneficial market footprint. They warned that a split decision in the region would introduce new costs and reliability risks by introducing "seams" into transmission operations that would have to be overcome.
PGE, PacifiCorp positions
"Maintaining reliability is already challenging in some circumstances, even as we've operated under the same rules," Larry Bekkedahl, a PGE senior vice president, said via email. "BPA's decision may adversely impact all customers in the PNW, including PGE's."
PGE highlighted that EDAM builds on the California grid operator's long-standing real-time market that brings in almost all of the West, including BPA, while Markets+ is starting from the ground up.
PGE had joined with PacifiCorp and Seattle City Light, a municipally owned utility, in a letter earlier this week making the case for EDAM and urging Bonneville to hold off on a decision.
"This would allow BPA to explore mechanisms to better monetize its participation in (the existing real-time market), while continuing to lead on governance reform as it considers future day-ahead market opportunities," the utilities said. "Additionally, it would delay the creation of an unavoidable, not easily managed or reversible, seam and maintain the coordination in the West that is critical to keep the lights on and costs down."
Two groups that support the clean energy transition in the Pacific Northwest expressed disappointment at BPA's decision.
NW Energy Coalition said it puts "every power customer in the Northwest ... at risk for higher costs on their monthly bills." Renewable Northwest said "we believe it will have negative economic impacts on regional customers that have not been adequately addressed."
Both groups noted the BPA staffing challenges that have been in the headlines in recent weeks.
"While we disagree with this proposed decision, we continue to support BPA's employees' essential work to manage the power and resources entrusted to them by the American people, to protect our fish, wildlife and natural resources, and to keep the lights on," Nancy Hirsh, NW Energy Coalition's executive director, said in a statement.
