If the electricity markets of the North Eastern US were patients in a hospital, their condition would not be improving, and some might even describe it as critical. New England’s redesigned capacity market, which ran in February under new rules for the first time, closed at a clearing price that was the lowest in six years. The second stage of the auction, designed to accommodate subsidized resources, cleared just 54 MW at $0/kW-m. PJM Interconnection’s energy and capacity markets are both in the process of being redesigned, with the 2019 capacity auction recently delayed for a second time due to the complexity of the proceeding and delay from federal regulators. The regional transmission operator (RTO) and independent system operator (ISO) operates across 13 US Northeastern states and Washington DC. Serving 65 million people, PJM is the largest US power market. And New York’s less liquid, short-term capacity market, along with its energy and ancillary services markets, could undergo design changes in the near term to improve price signals needed to attract new power plant investment and address other issues. Capacity markets are intended to ensure there is adequate capacity at a future date by paying generators to commit to future… continue reading
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Source: CTRM Center