ISO-New England, the folks who run the six-state power grid, have announced results for the latest capacity auction, which bribes – er, sorry, pays power plants a fixed amount regardless of their output. the system is designed to make sure there will be enough electricity available three years from now, giving companies a reason not to shut down a plant suddenly if the numbers don’t pencil out.
As is always the case, there’s more than enough for the 2027-28 period: 31.5 megawatts cleared the auction, meaning they were the cheapest bids that met various issues, which is several thousand over all-high maximum demand. Several points of interest:
- Winning bids were $3.58 per kilowatt-month, which is about 40% higher than the winning bid ($2.55) in last year’s capacity auction. Power plants expect costs to keep rising, it seems.
- New and existing solar and wind generation, energy storage, and demand resources won in the auction, totaling about 5,540 MW or about 18% of all capacity.
- New solar generation and energy storage resources or facilities combining the two secured obligations totaling about 795 MW. This accounted for the majority of new generating resources, which also included about 185 MW of new wind resources.
There’s also this in the ISO-NE statement, the significance of which I don’t quite understand: “Prior to the auction, the ISO proposed—and the Federal Energy Regulatory Commission (FERC) accepted—a net installed capacity requirement of 30,550 MW to meet reliability requirements for New England’s power system. The auction rules allow the region to acquire more or less capacity based on demand curves set by the capacity requirement. This provides flexibility to acquire additional capacity and enhanced reliability at a cost-effective price.”
Details about which power plants won in the auction will be released in a couple of weeks.