Dive Brief:
- ISO New England said today it expects to have adequate resources to meet demand this winter, aided in part by market solutions created after a cold snap last winter stretched generators thin.
- The grid operator earlier this month put in place a 21 day-ahead forecast of the region's available energy supplies, and developed a market mechanism to help ensure that fuel supplies are used most efficiently.
- The ISO is forecasting a winter peak demand of 20,357 MW, but says under an "extreme winter" scenario, the peak could reach 21,057 MW. Demand peaked at 20,631 MW during the cold snap last winter.
Dive Insight:
New England's two-week temperature drop last season spiked heating demand for natural gas, which in turn raised natural gas prices for generators higher than the price of coal or oil. As a result, "a significant portion of the region's electricity was generated by power plants that use oil," according to the ISO.
During the two-week stretch, the ISO said oil accounted for more than a quarter of the region's generation — compared with 0.29% in the previous weeks.
In a winter outlook issued Wednesday, ISO officials said they are eager to put the lessons learned into practice.
"Last winter demonstrated just how much the weather can impact power system operations, not just in terms of consumer demand for electricity, but in the ability of generators to access fuel," ISO New England Vice President of System Operations Peter Brandien said in a statement. "The ISO has learned lessons from this experience, and made near-term improvements to help address these energy security concerns."
But grid officials are also realistic, warning in their outlook that other weather events could challenge operations.
"As seen during last year's two-week cold snap, power system operations could become challenging if demand is higher than projected, if the region loses a large generator, electricity imports are affected, or during periods of fuel delivery constraints," the ISO said.
In addition to the two market initiatives, this will also be the first winter with the ISO's pay-for-performance capacity market rules in effect. The new rules provide enhanced incentives to generators — along with potential penalties — to ensure resources are online when needed.
Despite the enhancements, grid officials say they continue to be concerned about fuel availability, an issue they have raised before: In February, a report concluded the ISO New England's biggest challenges to reliability include a lack of fuel infrastructure to supply gas-fired generators.
In the new assessment, ISO officials say little has changed.
"The region's natural gas delivery infrastructure has expanded only incrementally, while reliance on natural gas as the predominant fuel for both power generation and heating continues to grow," the outlook says. "During extremely cold weather, natural gas pipeline constraints limit the availability of fuel for natural-gas-fired power plants."
New England's all-time winter peak demand was 22,818 MW, set in January 2004.
