Renewable Industry asks FERC to End New England Rules Favoring Natural Gas

By Varistor60, CC BY-SA 4.0


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A recent auction to secure electric generating capacity for New England steered over $1 billion of investment to power plants in the region, including 15 percent towards clean energy resources like solar, wind and energy storage.

Renewable industry groups RENEW Northeast and the American Clean Power Association said that regional grid operator ISO-New England’s decisions to assume natural-gas fired power plants have a 100 percent reliable fuel supply — despite ISO repeatedly warning that those plants could lose access to fuel during long cold snaps — is blocking renewables from taking on a larger share of that auction.

In a complaint filed with the Federal Energy Regulatory Commission this week, the renewable advocates called for the federal regulator to find that the ISO-New England market rules “provide undue preference to gas-only resources” and order ISO-New England to fix its rules to end that preference.

“A diverse array of clean energy resources can supply reliable capacity to New England, but wind, solar, and storage are clearly disadvantaged by current market rules favoring gas generators,” American Clean Power Association counsel Gabe Tabak said in a news release. “[We] are seeking a level playing field, in which all resources receive credit consistent with the capacity they are actually able to provide to the New England grid.”

ISO-New England’s annual forward capacity auction is meant to ensure there are enough power plants to meet the region’s energy demand three years in the future. Each auction, the ISO sets a number of megawatts it needs to ensure it can meet demand, and it assigns each power producer who enters the auction a “capacity accreditation” – basically the number of megawatts the region can count on that producer to generate.

ISO-New England discounts “intermittent” renewable resources like solar and wind to account for times they won’t be producing power when the sun isn’t shining or the wind isn’t blowing, the renewable advocates claim. Having a lower “capacity accreditation” makes the renewable projects less competitive in the auction.

Stephen Rourke, advisor with Daymark Energy Advisors and former Vice President of System Planning at ISO-New England, said in an affidavit supporting the renewable industry’s complaint that the process ISO uses to set a gas-fired power plant’s winter capacity rating only considers how much power the plant could produce when the temperature outside is 20 degrees – not whether it can get gas to burn in the first place.

ISO assigns lower summer ratings to wind power because there is less wind in the summer than winter, solar is rated at 0 megawatts in the winter because the peak demand time is after sunset, and hydro power has lower summer ratings because of lower water flows, Rourke said. 

But there is no discount for natural gas plants that might not be able to get fuel in a harsh winter, he said — a situation ISO officials have said is a real possibility during an extended cold snap given the limits of pipelines bringing gas into New England. This policy places pipeline-reliant gas plants on the same level of reliability as nuclear or oil-fired plants that store fuel on site, Rourke said.

“The winter capacity audit process is not designed to capture the real-world natural gas supply uncertainty during the severe cold weather conditions that will drive peak natural gas demand,” Rourke said.