Most flexible load operators in Southwest Power Pool (SPP) are leaving money on the table without realizing it because their generic demand response program isn’t designed to capture the revenue opportunities they need.
Southwest Power Pool offers one of the most lucrative revenue stacks for flexible loads in the country, but you need to stack those opportunities correctly to maximize $/MW each year. If you participate through a one-size-fits-all DR program , you’ll be lucky to hit $20k per MW annually. The right demand response partner can more than double that number, increasing your potential profits up to $80k per year.
The difference comes down to understanding how SPP’s markets work and how to optimize your participation around your specific economics, rather than relying on generic practices from legacy demand response programs.
This post breaks down the specific market mechanisms available in SPP, what each revenue stream is worth, and what it takes operationally to capture the full stack. If you're operating flexible load in SPP territory and you're not earning at least $60k per MW, this is where the gap is.
Understanding Southwest Power Pool market structure
If you’re operating flexible load in the central United States, you’re likely already familiar with SPP, but understanding how its market works is a different matter. Understanding the ins and outs of how Southwest Power Pool works can spell the difference between basic DR revenue and the kind of maximum returns that can earn you $60k+ per MW.
Southwest Power Pool is the regional transmission organization that manages the electric grid across 14 states in the central U.S. That footprint includes Oklahoma, Kansas, Nebraska, and portions of Texas, Arkansas, Louisiana, Missouri, South Dakota, North Dakota, Montana, Minnesota, Iowa, Wyoming, and New Mexico. SPP ensures reliable power delivery and wholesale electricity prices for about 19 million people.
As a Regional Transmission Organization (RTO), SPP doesn't own the grid infrastructure. Instead, SPP operates the system, runs the markets, and manages the dispatch of generation resources to keep supply and demand balanced at all times.
SPP is uniquely valuable for flexible loads because it isn’t just another RTO. Its market structure creates specific opportunities for flexible load operators due to a few key factors.
First, SPP has more wind generation than any other RTO in the country, which can create dramatic price swings. On windy nights across Oklahoma and Kansas, wholesale electricity prices are at rock bottom. On calm summer afternoons when air conditioners are cranking and wind generation drops off, those same prices can spike to $200+/MWh . If you’re running a flexible load, you have a unique opportunity to run at full speed ahead when power is nearly free and curtail when it’s expensive.
Additionally, SPP's grid is getting tighter. The combined reserve margin across SPP's territory dropped from 39% in 2015 to 22% in 2023, and it's expected to fall to just 13.6% by 2027. SPP raised its reserve margin requirement in response, resulting in a squeeze on utilities that is pushing up payments for flexible resources that can curtail on demand. If you can reliably reduce load during peak periods, utilities need what you're offering, and they’re willing to pay for it.
When you participate in SPP through a registered market participant, like Giga Power Systems, you get to engage directly with the markets, submit granular, hour-by-hour offers, and stack revenue across multiple programs. For flexible load data centers and bitcoin mining operations, this is the key to maximizing revenue per MW.
Read more: Key considerations when choosing data centers for bitcoin mining
Breaking down earning potential in SPP
The only way to maximize your earning potential is by understanding which revenue streams are available in SPP and how to stack them effectively. Let’s break down each of the revenue streams and show you the best way a flexible load operator can stack them.
1. Energy arbitrage opportunities
Energy arbitrage is the foundation of flexible load economics in SPP. Using this approach, you run your operation when electricity is cheap and curtail it when it's expensive. In markets with high renewable penetration, such as SPP, the spread between cheap and expensive hours can be dramatic.
The volatility created by SPP's wind-heavy generation mix gives you the opportunity to take advantage of a massive price spread. Furthermore, the tightening supply situation we discussed above is reshaping how much utilities are willing to pay for dispatchable capacity, positioning flexible load operators to capture premium payments that didn't exist two years ago.
2. Ancillary services markets
Ancillary services are the products SPP procures to keep the grid balanced. These markets are often overlooked by flexible load operators, but they can offer significant revenue potential if you can move quickly.
SPP needs backup power available at all times in case a generator fails or demand suddenly increases, which is where operating reserves come in. Flexible loads can provide the equivalent of reserves by curtailing on demand, freeing up grid capacity when it's needed most. Since you can respond faster than many traditional generators, the payments are typically higher than basic energy market participation.
Regulation services help maintain grid frequency by making rapid, automatic adjustments to balance generation and load on a second-by-second basis. While not all flexible loads are suitable for regulation, bitcoin miners and modular data centers with the right telemetry infrastructure can participate in and benefit from the revenue opportunities these services offer.
3. Traditional demand response programs
Demand response is what most operators first think of when they consider grid participation. DR is an important part of SPP, but it’s just one piece of the larger revenue stack rather than the whole picture.
Emergency DR programs activate during reliability concerns, like extreme weather events or unexpected outages, and pay high rates because the grid genuinely needs relief in those moments. These dispatches are infrequent, but if you're already enrolled with telemetry in place, capturing the revenue is straightforward.
Economic DR programs, on the other hand, pay you to reduce load during high-price periods even when there's no emergency. The dispatch frequency is higher with payments tied to wholesale energy prices. For flexible loads, this integrates naturally with your energy arbitrage strategy. In other words, you're already curtailing during expensive hours, so getting paid through a DR program is additional revenue for doing what you'd do anyway.
4. Capacity value and reserve margin requirements
In response to declining reserve margins across its territory, SPP raised its planned reserve margin requirement from 12% to 15%. This policy change is translating into higher capacity payments for flexible load operators because utilities are going to need your MWs to meet their obligations, and they’re willing to pay for it.
It’s important to remember that not all megawatts are equal in SPP’s eyes. Wind and solar, for example, have low capacity accreditation because they’re not reliably available during peak demand periods. Flexible loads, on the other hand, can achieve much higher accreditation if they can demonstrate reliable curtailment performance during those peak periods.
Battery energy storage systems and flexible data centers are uniquely positioned to capture this value because they can respond instantly and repeatedly without issue. Assuming SPP's reserve margins continue to tighten, your operational advantage in this area will only become more and more valuable over time.
The bottom line is that each of these four revenue streams is accessible through SPP, but most providers only capture one or two, leaving tons of cash on the table. In the next section, we’ll examine the reasons why so many operators are missing out on the revenue stacking opportunities available through SPP.
Why generic demand response programs leave money on the table
Most demand response aggregators weren’t built with bitcoin miners and flexible load data centers in mind. The traditional model was designed for hospitals, factories, and big-box retail stores that can dim lights or adjust HVAC as needed. But these one-size-fits-all demand response programs don’t work for flexible compute.
Generic DR programs treat all loads the same. They pool your megawatts with unrelated assets, submit blended offers daily or weekly, and dispatch everyone according to a set schedule. This approach doesn't work if you're running a 50 MW mining operation where a few hours of downtime can cost you a ton of opportunity cost tied to hash price.
A hospital's backup generator isn’t generating revenue, so it doesn’t matter when it runs or curtails. Your Bitcoin mining operation definitely cares.
Whether it makes sense to curtail depends on the relationship between wholesale electricity prices and Bitcoin's network difficulty at that exact moment. Generic DR providers aren’t monitoring hashprice or your site’s efficiency, they don't know your breakeven price, they don't track network difficulty, and they're not optimizing dispatch decisions around your hosting agreements or uptime commitments. Instead, they're making curtailment calls based on grid signals alone, which means you're leaving money on the table every time the grid value doesn't actually exceed your compute value.
The generic approach also misses opportunities to use real-time data to catch peak hours when they surface unexpectedly. Most DR aggregators submit offers once per day or even once per week. That approach might capture the most obvious peak hours, but it misses the real-time opportunities. Dynamic optimization means adjusting your strategy hour by hour, or even within the hour, based on actual market conditions, and that’s just not a strategy most DR partners are willing or able to employ.
Another challenge many flexible load operators face related to demand response programs is the snail-like pace of settlement timelines. Most DR aggregators pay out 60 to 90 days after the dispatch month closes. That's because they're waiting for SPP to settle, then internally reconciling across their entire portfolio, then cutting checks. If you're operating on tight cash flow or financing equipment, waiting three months for revenue is a real problem.
The takeaway is that generic demand response was not designed for revenue-generating loads. Bitcoin mining and flexible compute are different. Your downtime has an opportunity cost, your economics change hour by hour, and your operational constraints don't fit a one-size-fits-all model. Maximizing revenue in Southwest Power Pool means working with a platform that understands those differences and optimizes around businesses like yours.
Operational strategies to maximize Southwest Power Pool revenue
Understanding SPP's revenue opportunities is one thing. Capturing them consistently is another. In this section, we’ll walk you through the steps and strategies you need to maximize revenue per MW.
Hour-by-hour market participation
The first thing you need to do to optimize your market participation is get granular. Instead of deciding once per day or week whether and when to curtail, you need a solution that allows you to make that decision every hour based on current conditions.
A dynamic bidding strategy means adjusting your offers based on what's actually happening on the grid. You can take advantage of variants like:
- Wind forecasts
- Temperature extremes
- Generator outages
- Transmission constraints
Bear in mind that if you're operating under a hosting agreement with minimum uptime requirements, you can't curtail indiscriminately just because prices are high.
The solution is to set dispatch guardrails that protect your baseline obligations while allowing you to participate when conditions are right. That might mean limiting curtailments to a certain number of hours per week, capping total monthly curtailment time, or requiring a minimum price threshold before you'll dispatch.
Stacking multiple revenue streams
As we’ve covered, SPP offers energy markets, ancillary services, demand response programs, and capacity payments. Most operators participate in one or two of these programs, but the operators maximizing revenue are stacking them all.
You can submit offers to SPP's day-ahead energy market while also offering spinning reserves or supplemental reserves. The revenue streams are complementary:
- If you're dispatched for reserves, you earn reserve payments.
- If you're not dispatched but you curtail based on high energy prices, you earn energy market revenue.
- If that curtailment happens to align with a demand response event, you also capture DR payments.
The challenge is structuring your offers so they don't conflict. For example, you can’t offer the same megawatts into two different reserve products simultaneously. You must also ensure you have the telemetry and control systems to respond to whichever dispatch signal comes through first.
Some DR programs have exclusivity requirements or restrict your ability to participate in other markets during certain hours. Some ancillary service products require you to hold capacity in reserve rather than running at full load. Before signing up for multiple programs, you need to understand the dispatch rules and settlement mechanics for each.
The best approach is working with a provider, like Giga Power Systems, that manages those interactions for you, submits offers, and automatically adjusts your participation to avoid conflicts.
Telemetry and compliance requirements
SPP requires real-time telemetry, metering data, and verification that you delivered on your curtailment promises. At a minimum, you need:
- Interval metering that reports your load every 5-10 minutes (depending on the market)
- Communication infrastructure that transmits that data to SPP in real-time
- Remote control capability so SPP or your market participant can send dispatch signals directly to your site
For ancillary services markets, the telemetry requirements are even more strict. You need sub-minute data and proof that you responded within the required timeframe: 10 minutes for reserves, seconds for regulation.
Most Bitcoin mining operations and modular data centers already have remote monitoring through miner management software or SCADA systems. The question is whether that infrastructure integrates with SPP's telemetry requirements. If not, you'll need to install additional metering equipment, communication hardware, and control interfaces.
After you curtail, SPP verifies your performance by comparing your baseline load against your actual metered load during the dispatch period. The difference is your delivered curtailment, and that's what you get paid for.
Fleet aggregation for scale
If you're operating a single 10 MW site, market participation is relatively straightforward. If you're operating five sites totaling 75 MW spread across Oklahoma, Kansas, and Nebraska, fleet management becomes critical.
Each site has its own load profile, equipment characteristics, interconnection constraints, and hosting economics. Managing them as a portfolio means optimizing dispatch decisions across all sites simultaneously rather than treating each one independently.
SPP's footprint covers multiple utilities and multiple pricing nodes, and wholesale electricity prices vary by location based on transmission congestion and local generation mix. On any given hour, prices in one region might be near zero while prices in another might be elevated. If you have sites in both locations, your curtailment strategy should reflect those differences.
The same logic applies to ancillary services. Reserve prices vary by zone, and submitting offers strategically across your fleet is the best way to maximize your revenue. This level of optimization is difficult to achieve manually, which is why most multi-site operators either use sophisticated market participation software or work with a provider, like Giga Power Systems, that manages fleet dispatch on their behalf.
Getting started: How to maximize your Southwest Power Pool revenue
If you're operating flexible load in SPP territory and you're not earning $60-80k per MW annually, you're leaving money on the table. The question is: how much, and what do you need to change to capture it?
Start by assessing where you are today.
Are you participating in SPP markets at all, or are you simply buying power at retail rates without any grid revenue?
If you are participating, is it through a basic demand response program that only captures emergency curtailments, or are you actively engaged in day-ahead energy markets, ancillary services, and capacity programs?
Once you understand your current setup, the next step is to evaluate your performance. Calculate your actual revenue per MW over the past 12 months, consider your current settlement speeds, and examine your reporting to see if you’re able to access real-time performance data.
Most importantly, consider whether or not your current provider understands the specific economics of your business. If the answer is no, it’s time to find a platform built for businesses like yours rather than trying to fit the square peg of bitcoin mining or flexible load data center operations into the round hole of generic demand response.
You need a platform built by operators, for operators. Enter: Giga Power Systems. We built our platform because we run flexible load sites ourselves, and we built the tools we needed when generic DR providers couldn’t deliver the results we wanted.
Generic solutions were designed to pick off the easiest opportunities rather than capture the full revenue stack. If you want to capture the full revenue opportunity offered by participating in SPP, you need a purpose-built solution and a coordinated strategy.
Ready to see how much revenue per MW your facility can earn with Southwest Power Pool? Schedule a consultation with our team today to learn more.
