New England must balance multiple objectives as it navigates the clean energy transition, according to the operator of the region's electric grid and wholesale electricity markets.
ISO New England, Inc. is the regional transmission organization serving all of New England except northern Maine. ISO-NE administers the regional electric transmission system and wholesale markets for electricity.
The region must increasingly balance multiple objectives in light of state policies promoting renewable energy and decarbonization, according to recent remarks by ISO-NE President and Chief Executive Officer Gordon van Welie.
Historically, the grid and markets were designed to maintain the reliability of the regional bulk electric system, while minimizing costs by selecting the lowest-price resources: what ISO-NE calls the "least-cost security-constrained economic energy-dispatch model". But according to a presentation by Gordon van Welie at the March 22 meeting of the New England Electricity Restructuring Roundtable, "there is not an adequate regional mechanism to sufficiently value clean energy attributes or price carbon – which are public policy decisions."
Additionally, each of the six New England states has adopted various policies regarding renewable energy and decarbonization or beneficial electrification of the whole economy or of specific sectors like transportation and heating. ISO-NE projects a significant increase in electricity consumption as a result of these state policies, with the potential to triple existing peak demand by the early 2030s. This will require a large scale of carbon-free generating resources. According to van Welie, "Existing carbon-free energy resources are an important part of achieving these policies."
The ISO-NE leader noted the consequence of these dynamics: "Greater dependency on the capacity market for all resources, and a need for supplementary, out-of-market revenues for carbon-free resources that are uneconomic in the wholesale market".
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