Non-ERCOT Utility Proposes Allowing Large Loads To Satisfy Their Load With Third-Party Generation

Southwestern Public Service Company (SPS, or Xcel Energy) has proposed a large load tariff at the Texas PUC that would, among other things, allow large loads to serve their load in whole or in part through "third-party generation" under contract with SPS to specifically serve one or more identified end-use customers

SPS's proposed large load tariff (LLT) would apply to customers 75 MW and larger

"The proposed LLT contemplates customer-owned generation, third-party generation under contract with SPS, or other mutually agreed configurations between SPS, the customer, and any applicable third party, provided they meet safety, reliability, and operational standards, and any applicable law," SPS said

"SPS retains the right to review and approve dedicated generation connected to its system for operational compatibility, safety, and reliability prior to interconnection, but does not expand its role beyond what is already permitted under existing rules and contracts," SPS said

The proposed tariff provides that large load customers may elect to satisfy a portion or all of their large load electric requirements through "dedicated generation resources", which may include (i) customer-owned generation facilities, (ii) third-party generation under contract with SPS to specifically serve one or more identified end-use customers, or (iii) other arrangements mutually agreed upon by SPS, the customer, and any other parties, "(which may include, but are not limited to, system dispatch, administration and settlement fees) [sic]".

All incremental capital, operations and maintenance costs associated with dedicated generation -- including but not limited to generation facilities, interconnection facilities, transmission or distribution upgrades, system impact studies, network upgrades, fuel, metering, telemetry, protective equipment, and any related infrastructure improvements -- shall be the sole responsibility of the customer, the proposed tariff states

"Nothing in this tariff obligates the Company to purchase power from, provide backup service to, or otherwise integrate dedicated generation resources onto Company's [SPS] system beyond the terms expressly agreed in the ESA or a separate interconnection agreement," the tariff states Docket 60332