Biden-Harris Administration Announces more than $10 Million to Support State Engagement and Analysis in Wholesale Electricity Markets, Reducing Costs for Consumers

WASHINGTON, D.C. — The Biden-Harris Administration, through the U.S. Department of Energy (DOE), today announced up to a total of $10.6 million for six projects to improve state and regional engagement in wholesale electricity markets. The Wholesale Electricity Market Studies and Engagement (WEMSE) Program provides funding to states and regions related to developing, expanding, or improving wholesale electricity markets. This engagement will ensure these stakeholders are able to provide critical insight into market design, expansion, and improvement activities. The six projects announced today will help facilitate the improvement or creation of more efficient and flexible wholesale markets, which will be essential to ensure grid resilience and reliability as new load and generation come online.

“Efficient, fair, and transparent markets are essential as we transition to a clean, reliable, equitable electric grid,” said Maria Robinson, Director, Grid Deployment Office. “But U.S. wholesale markets were designed three decades ago when the U.S. electric grid looked much different. With the widespread deployment of new clean energy resources and advanced grid and transmission technologies, creating effective wholesale electricity markets is critical.”

As more clean and renewable resources come online, creating more flexible and efficient markets would not only ensure a reliable supply of electricity, but also help keep prices low for consumers. Utilities, state agencies, and market operators themselves have valuable perspectives on how to address this, but many currently lack the resources or training to meaningfully participate in market development. Increasing engagement can improve market efficiency and decrease the cost of electricity, often lowering energy bills for consumers. Administered by DOE’s Grid Deployment Office, the WEMSE program provides technical and financial assistance to help ensure these stakeholders are able to provide critical insight into market design, expansion, and improvement activities, including interregional transmission infrastructure development.

The six projects selected today could receive up to a combined total of $10.6 million in funding to identify and implement market improvements. 

• Cornell University will analyze price formation and resource procurement policies in wholesale electricity markets that could accommodate an evolving resource mix of higher levels of wind, solar, and storage in future electricity systems, in support of efficiency and reliability in both the short and long term. ($2 million) 
• Electric Power Research Institute (EPRI) will study Southwest Power Pool’s (SPP’s) current and projected market configurations by developing advanced modeling approaches and a market simulation framework to prototype new market design features, including accounting for greenhouse gas emissions in markets. ($1.4 million) 
• National Association of State Energy Officials (NASEO) will inform state energy offices on regional wholesale market design and how they impact resilience and resource adequacy through informational materials and trainings/convenings. Efforts will strive to examine how state-level integrated resource planning can be coordinated with broader regional plans to enable states’ successes and to engage local governments and other stakeholders (such as the private sector and community groups) that state energy offices interact with on resilience, reliability, and market issues. ($3 million) 
• Pennsylvania State University will identify market design changes that efficiently integrate batteries and other unconventional resources by assessing potential market design changes to manage intertemporal constraints and uncertainties using a realistic market simulation model with PJM Interconnection and ISO New England. ($816,000)
• University of Texas at Arlington will study the benefits, aggregability, and deliverability of aggregated distributed energy resources (ADERs) and facilitate the adoption of ADERs into wholesale electricity markets, specifically in the Electric Reliability Council of Texas market in Texas. ($1.6 million)
• Western Power Pool will conduct planning analyses across the Western Interconnection to produce 10-year and 20-year transmission plans, which will identify benefits for western states and Tribes to achieve their respective energy goals, as well as improved interregional transmission planning. ($1.8 million) 

GDO is administering the WEMSE program through rolling application rounds. This is intended to afford states, market operators, and other wholesale market stakeholders the time to develop coalitions and coordinate joint applications as appropriate. The next deadline to submit concept papers is June 13, 2024.

Private industry and national labs who receive funding through this program are required to collaborate with a state or regional system operator, or a coalition of states or regional market operators. Importantly, WEMSE funding supports studies, convenings, education, and analysis but does not support hard infrastructure development or tools. 

Learn more about the Grid Deployment Office.