A dependable, reasonably priced supply of electricity is essential to the quality of life of New England’s 14 million residents and is the lifeblood of the region’s $700 billion economy. Without it, businesses cannot operate productively, hospitals and schools cannot provide essential services, and residents cannot depend on the amenities of daily life in our modern society.
While electricity is a basic necessity, it is also a commodity—a product that is produced, sold, and transported for profit by hundreds of companies. And like most commodities, electricity is sold on both a wholesale and retail level.
ISO New England is the independent, not-for-profit organization responsible for overseeing the wholesale side of the electricity industry in the northeastern states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont.
Our 500 employees are made up of power system engineers, economists, and computer scientists who fulfill three critical responsibilities that together ensure New England has reliable, competitively priced electricity today and into the future.
Rules and Standards Define Us
In New England, the wholesale electricity industry is able to fulfill the dual goals of maintaining reliable electricity service at competitive prices because we have certainty of purpose and are guided by solid rules and standards.
In fulfilling each of our three roles, the ISO abides by the standards and requirements established by the Federal Energy Regulatory Commission (FERC), the North American Electric Reliability Corporation (NERC), and the Northeast Power Coordinating Council (NPCC). We are regulated by FERC, which defines our authority and the services we provide. NERC, which is subject to the commission’s oversight and approval, develops and ensures compliance with mandatory standards for planning and operating the power systems around the country and can levy fines of $1,000 to $1 million per day for violations. NERC coordinates its activities with eight regional entities that develop, implement, and enforce reliability criteria on a regional level. New England is part of the NPCC region.
Grid operation: We have developed procedures to meet these numerous, stringent regional and national requirements for keeping the lights on. These procedures work well—the New England grid has not experienced a widespread system outage in over four decades.
Market oversight: New England’s markets are guided by clear rules approved or mandated by FERC, resulting in a marketplace that has yielded numerous reliability and economic benefits.
System planning: We have been able to form a successful transmission planning process because national, mandatory reliability standards provide clear goals and because industry roles and authority for planning the grid to meet these standards are well defined.
The agreements, tariffs, and contracts that govern the services ISO New England provides and the relationships it has with entities that generate, buy, sell and transport electricity in New England can be found on ISO New England’s website, under Rules & Procedures.
Culture of Compliance
A 2009 NERC/NPCC audit found the ISO compliant with all 41 applicable reliability standards and 375 requirements and subrequirements over a two-year period, from June 2007 to April 2009. During this review, we were one of the first organizations in the U.S. to be audited for compliance with Critical Infrastructure Protection standards that safeguard certain energy infrastructure information. In analyzing our culture, NPCC stated that compliance is an “integral component of ISO New England operation.” The ISO dedicates full-time resources to ensuring the company meets existing standards and follows the development of new standards.
Cost to Consumers
The operating cost to provide our essential services is approximately $130 million per year.
That's about 79 cents per month for each customer in New England.