FERC gives nod to ISO-NE’s installed capacity requirement calculation for FCA 13
Washington — ISO New England will need to procure a net value of at least 33,750 MW during a forward capacity auction slated for February to meet the reliability requirements of the region for 2022-23, according to a Federal Energy Regulatory Commission order accepting the grid operator’s method for calculating installed capacity requirements.
ICRs are calculated before each FCA as a measure of the installed resources projected to be necessary to satisfy New England’s peak demand forecast and maintain sufficient reserve capacity. The ICR and related values, such as local sourcing requirements and maximum capacity limits, are used to develop an auction’s demand curve but must first be approved by FERC.
ISO-NE has consistently based its calculation of the ICR on load forecasts, resource capacity ratings, resource availability and load “relief assumed obtainable by operator actions during capacity deficiencies,” such as tie benefits from interconnections with neighboring areas and capacity from operating reserves, the order said. But proposed ICR values for FCA 13 drew scrutiny when the grid operator changed the assumption governing the level of system reserves needed for reliable operations during emergency conditions.
RESERVES ASSUMPTION INCREASED
That figure had stood at 200 MW since 1980 but was increased to 700 MW for the upcoming auction to account for “changes in peak load, an increase in the size of credible contingencies on the New England transmission system, New England’s limited tie capability to the Eastern Interconnection, and changes in the resource mix,” ISO-NE determined.
The New England States Committee on Electricity challenged the reserves assumption increase, arguing that ISO-NE failed to provide analysis supporting the magnitude of the increase and tends to overestimate the ICR causing over-procurement that has historically been “more than enough to cover the 550 MW by which ISO-NE proposes to increase ICR” under its new assumption.
But FERC said in its order (ER19-291) issued Friday that “the precise reserves assumption is a matter of engineering judgment,” and ISO-NE had demonstrated the proposed increase was just and reasonable.