ISO-NE to file stakeholder-supported plan for MOPR removal, renewable technology exemption
ISO New England intends to file in the coming weeks a proposal with the Federal Energy Regulatory Commission (FERC) to remove the minimum offer price rule (MOPR) from the Forward Capacity Market (FCM). The proposal would see the MOPR removed ahead of Forward Capacity Auction (FCA) 19, scheduled for 2025, and create an exemption from the MOPR for 700 megawatts (MW) of capacity from state-sponsored renewable resources for FCAs 17 and 18. This exemption is in addition to other current opportunities for renewables to enter the capacity market.
The proposal was first put forward by stakeholders, and was supported by the New England Power Pool (NEPOOL) Participants Committee at their February 3, 2022 meeting. During the stakeholder process, the New England States Committee on Electricity (NESCOE) indicated that while five of six states support more immediate MOPR reform, while maintaining system reliability, the ISO’s “support of a transition proposal as the preferred way to reform the MOPR while mitigating the potential for short-term reliability impacts provides an additional insight” that led five of six states to not oppose the transition approach.
This transition proposal, paired with the renewable technology resource (RTR) exemption, will serve the region with a dual objective of protecting power system reliability while having state-sponsored resources gain entry to the market. More certainty on the quantity of sponsored resources entering the market should also lessen the potential for any reliability risk caused by inefficient retirements that can occur when delays arise in the development of new resources.
Industry and government stakeholders agreed with the RTR exemption amount of 700 MW. This amount signifies the value that the renewable resources are able to take on as an obligation in the capacity market, which is likely much less than their nameplate value.
Given their individual development timelines, many sponsored resources are not yet prepared to enter the markets, and the 700 MW for renewable exemptions should be sufficient to bring in the resources seeking to enter the capacity market over the next two-auction period before the MOPR is fully eliminated.
In addition to the RTR exemption, sponsored resources would be able to enter the capacity market through the substitution auction process.
ISO New England continues to work with the New England states and NEPOOL stakeholders to provide a reliable transition to the clean energy future.