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Division Between ISO-NE and Participants over Energy Security Proposal

April 23, 2020

On April 15, ISO-NE introduced a new proposal to the federal regulators of the Energy Security Improvements authority for improving reliability during shortages and winter months. Some of these initiatives include: Day-Ahead Replacement Energy Reserve (RER); Day-Ahead Energy Imbalance Reserve (EIR); Day-Ahead Generation Contingency Reserve (GCR). As mentioned, the main goal is of improving energy security while keeping costs for users in check.

With the presentation of this 1700+ page document, the NEPOOL commision disagreed with what ISO-NE wanted to accomplish. NEPOOL submitted a proposal of its own, but would have to get at least 60% approval from the market participants. A main issue with this is how energy security requires large scale investments, which also entails a high enough energy price to recover this. 

Under ISO-NE’s proposed agreement, the seller of energy would get upfront payment in exchange for the right to call on capacity the day it is required. Said plan would need to become effective after November 1st 2020.