Seeking Rapid Elimination of a Barrier to Renewable Energy

Submitted by Jerry Halberstadt on Thu, 04/28/2022 - 19:34

Re: Revisions to ISO New England Transmission, Markets and Services Tariff of Buyer-Side Market Power Review and Mitigation Reforms, FERC ER22-1528-000 

I urge you to require ISO-NE to immediately end the minimum offer price rule (MOPR) and to re-open their forward capacity and forward reserve auctions to all renewables.

Chairman Glick and Commissioner Clements have clearly stated the argument for ending the use of the minimum offer price rule (MOPR).

“The [ISO-NE] MOPR appears to act as a barrier to competition, insulating incumbent generators from having to compete with certain new resources that may be able to provide capacity at lower cost. Such overbroad barriers are the antithesis of market competition, in that they divorce capacity market clearing prices from the actual net going forward costs of would-be capacity suppliers and serve only to prop up capacity prices, protect incumbent generators, and increase the costs of state policies.”Order Accepting Informational Filing and Directing Modification, 178 FERC 61,050 (2022),

This rule serves to protect existing and planned fossil fuel generation from competition, competition which on a level playing field, renewable sources are winning.

Gordon van Welie, the president and CEO of ISO-New England, in a recent article in Commonwealth Magazine, seeks to justify continued reliance on natural gas.

“The problem in New England is we don’t have a very predictable input source into the electric grid, particularly in the winter time when the gas pipelines are constrained,” he said. “I really see [natural] gas as the only option for balancing the system at the moment.” —Commonwealth Magazine, April 11, 2022

However, supplies of natural gas are constrained during severe winter weather, and are not readily available for power generation. For short-term capacity needs, battery storage is proving more reliable and less expensive. For longer periods, balancing demand through the forward reserve market would have to rely on oil-fired generation. As offshore wind becomes installed in the coming years, if we upgrade our transmission and battery storage, wind will become the likely most reliable source, especially during severe winter storms.

To the extent that there is a realistic need for continued reliance on fossil fuel generation during the transition to renewable, non-emitting resources, ISO-NE can reduce fossil-fuel based contracts only as comparable amounts of renewable resources are available. Continuing to rely on MOPR to exclude renewables and protect fossil power is not a rational policy, and worse, it stands in the way of urgent action to reduce all use of emitting sources in order to mitigate climate change and meet Federal and state limits on emissions.

In their request to revise the MOPR over a two-year period, ISO-NE acknowledges the function of the rule is to penalize renewable resources for the support they may receive from the state to encourage reducing fossil fuel use and meet climate roadmap goals. They recognize the financial threat to fossil generation facilities and in the interests of “fairness” want to force renewables to be priced high enough so that the fossil facilities can compete. They conveniently ignore the ongoing Federal and other subsidies to the fossil fuel industry, while declaiming the modest support available to new renewable resources.

Gordon van Welie asserts a concern that New England may face a shortage of electricity. But there is a growing resource available, consisting of renewable energy and storage.

The region is now at a crossroads. New Englands generation mix is poised to change dramatically. The states have substantially increased their decarbonization goals, with corresponding expansion of state clean energy procurement targets and renewable portfolio standards. The ISO interconnection queueone significant measure of new resource interest in New Englandis dominated by renewable and clean-energy resources. All new resources that cleared in the most recent Forward Capacity Auction were renewable or clean.”

Because the IPCC has established that mitigation of the most extreme impacts of climate change must be urgently addressed now, and given that climate change poses an existential threat to civilization and the planet, FERC should move to enable the most rapid feasible transition to renewables.

Therefore, I urge the Commissioners to require a more rapid transition from the current MOPR than the two-year process proposed by ISO-NE.

Thank you for your consideration