ISO-NE updating accreditation standards to ensure resource reliability
New England’s power grid is rapidly evolving as economic trends, technological advances, and state environmental policies fundamentally alter the mix of resources providing electricity across the region. A key project underway at ISO New England aims to account for the unique attributes of the resources that will make up the future grid and accurately measure each resource’s contribution to system reliability. This extensive and complex project is critical to ensuring a reliable clean energy future.
More than 1,000 resources participate annually in the region’s Forward Capacity Market, acquiring obligations to help meet projected demand by generating electricity or reducing consumption, and earning money for providing this capacity. As the region’s resource mix evolves, so too must the methods by which ISO New England measures capacity contributions, thereby ensuring the region has the resources it needs.
For more than a year, ISO New England and the region’s stakeholders have been working on the Resource Capacity Accreditation (RCA) project, with plans to file a proposal with the Federal Energy Regulatory Commission (FERC) this fall. This timeline would allow the ISO to implement the new process in the 19th Forward Capacity Auction, scheduled for 2025 to procure the resources needed for the 2028/2029 capacity year.
“Enhancing the way that we measure and accredit the capacity contribution from all resource types will enable the region to more cost-effectively procure the resources necessary to keep the system reliable as it continues to evolve,” said Tongxin Zheng, the ISO’s director of Advanced Technology Solutions and an RCA project leader.
Determining projected production years in advance
When determining the amount of capacity a resource can bid into the Forward Capacity Market, ISO New England looks at what an individual resource can be reasonably expected to produce during peak conditions three years in the future. This process involves examining a number of factors, including the resource’s physical characteristics and historical performance. The RCA project builds upon this framework, while evolving to meet the changing needs of the region, looking at the different characteristics of the resources expected to make up a growing share of the region’s power mix.
Solar panels produce energy when the sun is shining, but not at night, when it’s cloudy, or when they’re covered by snow. Wind turbines require wind speeds within a certain range. Energy storage resources can only store so much and discharge for so long.
Fossil fuel resources can also have limitations on their ability to provide energy. Natural-gas-fired power plants can only run when they can access fuel, supplies of which can be limited in the winter. Oil-fired resources do not need to rely on natural gas pipelines, but they may have limited fuel onsite.
The accreditation reforms cover many topics, but examine four key areas of resource performance in particular:
Wind and solar resources in the same geographical area tend to produce electricity at the same times. As use of these intermittent resources increases, so does the potential risk to power system reliability when they are offline.
Today, storage resources are compensated regardless of how much energy they can store. Under RCA, resources with less stored energy are likely to be paid less than otherwise identical resources with more stored energy.
Winter risks and fuel availability
RCA will incorporate winter seasonal risks into the resource adequacy assessment for the first time. In addition, natural gas pipelines become constrained in winter when priority is given to residential heating customers. Power plants that rely solely on pipeline gas purchased on the spot market will be compensated less than otherwise identical resources that have stored fuel onsite, or that have firm contracts to access pipeline gas.
Resources determined to be more likely to have an unexpected outage when the system needs them generally will be paid less than otherwise identical resources that are less likely to be out of service under the same conditions.