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Higher Electricity Prices Forthcoming? FERC Conditionally Accepts ISO-NE’s Winter Reliability Program

September 25, 2013

ISO-NE’s proposed reliability program for the 2013/2014 winter has been tentatively accepted by the Federal Energy Regulatory Commission as an adequate solution to the reliability challenges coming this winter. The program hopes to alleviate potential problems with operational challenges in the winter that could arise because of the heavy reliance on natural gas-produced electricity in New England in addition to concerns about the scarcity of natural gas. The program is also being accepted in part due to the shortage of capacity caused by Entergy’s closing of the Vermont Yankee Nuclear Power Station.

Implementation of the reliability program would almost guarantee even higher electricity prices across the board in NEPOOL for both suppliers (whether they take on the cost associated with the program or pass it through) and utilities.