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Friday
Feb082019

An update on Vineyard Wind’s participation in FCA #13

To clarify misinformation that has been reported in the press and circulated online, ISO New England is providing this background on Vineyard Wind’s participation in the Forward Capacity Auction (FCA) #13, which took place earlier this week.

Vineyard Wind participated in both FCA #13’s primary auction and secondary substitution auction. The offshore wind farm secured a 54-megawatt capacity supply obligation during the substitution auction.

At issue is the FCA’s Renewable Technology Resource (RTR) exemption, which allows for a certain amount of megawatts from New England-based renewable resources to be exempt from the minimum-offer price rule that applies to new resources in the primary auction. Renewable resources do not need to be designated as RTRs to participate in the primary or substitution auctions.

During the qualification process for FCA #13, it was determined that the RTR exemption language precluded resources in federal waters from receiving the exemption. Realizing that this stakeholder-submitted language in the tariff diverged from the initial intent of the provision, ISO New England, working with the New England states and members of the New England Power Pool, filed tariff changes on November 30, 2018 to allow offshore wind resources located in federal waters, such as Vineyard Wind, to qualify for RTR treatment in FCA #13 and future auctions. These changes were approved by the Federal Energy Regulatory Commission (FERC) on Jan. 29, 2019.

As part of the approved changes, resources located in federal waters that wished to participate in the FCA #13 auction as an RTR would need to seek a waiver from FERC since deadlines for qualifying for the auction had passed. Vineyard Wind applied for this waiver on December 14, 2018. The ISO filed comments on Vineyard Wind’s waiver request, stating that it did not oppose the waiver and if FERC approved the tariff language changes by January 29, the resource would receive RTR treatment for FCA 13. As of February 8, 2019, FERC has not yet acted on the waiver request.

Because the Commission did not act on the waiver request in time for the auction, Vineyard Wind did not receive RTR treatment in FCA #13. Vineyard Wind filed an emergency motion on the day of the auction, asking FERC to either delay the auction, or to require it to be re-run later, after FERC ruled on Vineyard Wind’s waiver request. FERC did not act on the request for stay before the auction. The ISO conducted and concluded the primary auction in accordance with FERC-approved rules on February 4, 2019.

While ISO New England did not oppose Vineyard Wind’s request for a waiver to allow it to receive RTR treatment in the auction, the ISO did oppose Vineyard Wind’s request to delay or re-run the auction because doing so would harm market participants who made decisions under the expectation that the auction results would be final, subject to FERC approval.

Offshore wind projects in federal waters, including Vineyard Wind, will be eligible for the RTR exemption in next year’s auction.

A timeline of events:

Nov. 30 – ISO New England filed a package of CASPR-related changes, including revised renewable technology resource (RTR) exemption language what would make offshore wind in federal waters eligible, and allowing offshore wind in federal waters to file for a waiver to seek an RTR exemption for FCA #13.

Dec. 14 – Vineyard Wind files for a waiver to allow it to receive a RTR exemption in FCA #13. That waiver request is pending at FERC as of February 8, 2019.

Jan. 4 – ISO New England files comments on Vineyard Wind’s waiver request, stating that it did not oppose the waiver request, and noting that if a ruling was received by Jan. 29 allowing Vineyard Wind’s waiver request, the resource could be included in FCA 13 with a renewable technology exemption.

January 29 – FERC order allowing the ISO’s CASPR-related changes, including the revised language pertaining to offshore wind in federal waters (however, Vineyard Wind’s waiver request was still pending).

Feb. 4 – Vineyard Wind files emergency motion at FERC seeking to delay the auction, or to have it rerun if it received the RTR waiver. The emergency motion is still pending.

Feb. 4 - 5 – FCA #13’s primary and substitution auctions were conducted; Vineyard Wind participated and procured a 54-MW capacity supply obligation in the substitution auction.

Feb. 6 – The ISO filed a motion opposing the request to delay or re-run the auction.