Dive Brief:
- FERC this week approved changes to New England's forward capacity market auctions, but New York grid operators warn the changes could cause capacity prices in the state to spike $341 million, SNL reports.
- While ISO-NE runs a three-year forward auction, changes to its tariff would allow resources that clear the capacity auction to begin submitting bids sooner than previously allowed.
- The New York ISO requested FERC delay implementation of the changes, saying consumers could see a spike in prices if the Roseton 1 power plant is allowed to export power next year.
Dive Insight:
Federal officials denied New York's request to delay tariff change implementation, saying the flaw lies in New York's rules and not the regional ISO.
In its decision, federal regulators said they recognized the New York ISO’s concerns "about a potential flaw in its market rules," but it approved the new tariff anyway.
New York ISO Market Monitor David Patton previously told the commission that when the New York capacity resource is available and New England calls for it, the ISO will input the export in its real-time dispatch model, which will increase its aggregate dispatch. But "the increase in output will actually be produced from NYISO’s marginal generating resources (not necessarily from the capacity resource itself)," Patton said in an affidavit to FERC.
While the actual price implication would depend on market conditions, New York said its $341 million impact is based on a hypothetical export of 500 MW from the gas-fired plant. The ISO had asked FERC to delay implementation a year, though it did not ask the changes to be rejected.
The changes allow cleared capacity to begin bidding into New England ISO's annual reconfiguration auctions, where suppliers may release shed or acquire capacity. Roseton 1 could begin exporting power next summer.
