Could New England be the cradle for the energy evolution too?
Photo by Stephanie McCabe on Unsplash
- March 20, 2019
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History tells us the important role New Englanders played in “jump starting” the United States into becoming the greatest country on Earth. Obviously, I’m proudly biased by my heritage. A recent announcement from New England’s Governor’s may not have the historical significance of the Declaration of Independence, but their commitment to fix the way that energy capacity is secured in New England is indeed a “shot heard around the industry”.
On the surface, a 10-year financial commitment from Connecticut’s main Utility Companies, Eversource and United Illuminating, to ensure the survival of the Millstone Nuclear Facility, outside of Wholesale Capacity Markets, might appear to be the death knell for Wholesale Capacity Markets, especially in light of similar commitments for Mystic 8 and 9 power plants in Massachusetts. However, the announcement contains some very encouraging prose that would seem to indicate a higher commitment by the Governor’s to “fix what’s wrong” with the Wholesale Capacity Market in New England. Here are some excerpts from the announcement, which give me reason to believe that positive change is possible:
“the New England Governors commit to work together, in coordination with ISO New England and through the New England States Committee on Electricity (NESCOE), to evaluate market-based mechanisms that value the contribution that existing nuclear generation resources make to regional energy security and winter reliability. In addition, to the extent a state’s policies prioritize clean energy resources, those states commit to work together on a mechanism or mechanisms to value the important attributes of those resources, while ensuring consumers in any one state do not fund the public policy requirements mandated by another state’s laws.”
It would appear that NESCOE has been given a mandate to ensure that the Governor’s commitment to these highlighted items is satisfied by whatever Capacity Market solution is agreed to, along with ISO New England. No timeline was specified for the solution to be completed.
The parallels to 1776 don’t stop with this announcement. Other states and regions are also struggling, just like New England States, to meet State Energy targets for renewable, clean energy, in regions with Capacity Market designs that are too rigid or inflexible to properly manage capacity in the dynamic and evolving electrical system, that exists today. New generating capacity is coming on to the system daily in large quantities, across the United States. The problem today is not insufficient capacity to meet demand. There is excess capacity already in place, that needs to be better managed. The old way of thinking about how to secure capacity “years in the future”, in order to give time for construction of generating units, fails to address and manage the rapid expansion of new DER capacity, especially behind the meter (BTM) Solar installations, that is occurring daily. A new approach is needed that properly values, and efficiently utilizes, all capacity resources for what they provide to grid reliability and in meeting State energy targets, nationwide, not just in New England. We may not have an equivalent to Independence Hall to bring everyone together to find a solution, however we do have a proven, nationwide, process for creating successful energy industry standards (NAESB), that become FERC regulations, which have quietly and effectively served the industry in managing Transmission Capacity for over 10 years, called OASIS.
Tonight, I’ll proudly lift a pint of Samuel Adams and toast to the success of NESCOE in finding an appropriate Capacity Market solution for New England and hope that this step could also lead to another great union across America to solve the capacity acquisition conundrum for all.