NE Electricity Prices Set to Increase in Response to Capacity Auction
February 6, 2014
The Independent System Operator for New England (ISO-NE) released results on Wednesday, February 5 for the eighth Forward Capacity Auction for June 1, 2017 to May 31, 2018 it held on February 3. The auction produced 33,702 MW in capacity, 153 MW fewer than ISO-NE expects will be needed for the year mentioned above (33,855 MW). This is the first time the forward capacity auction has yielded less than the estimated power requirements; there had always been an oversupply. Gordon van Welie, ISO-NE president and CEO, indicated that the reason for this is that several major New England plants have planned shut down by 2017. They include the following power plants:
Brayton Point in Somerset, MA (1,535 MW)
Vermont Yankee in Vernon, VT (600 MW)
Salem Harbor in Salem, MA (750 MW)
Norwalk Harbor in Norwalk, CT (350 MW)
Though the closings do not mean the region will not have enough power to operate in 2017-2018, it does mean electricity prices are set to increase in 2017-2018. 600 MW worth of demand response is also planning to retire; however, the closings are the primary reason for future increase.