NYISO Commits to Continued Evolution of Capacity Market & Mitigation Rules in Response to NY Energy Policy
RENSSELAER, NY (03/23/2021) (readMedia)-- New York ISO President and CEO Rich Dewey today, in excerpted testimony submitted to the Federal Energy Regulatory Commission ("FERC") for a technical conference examining, "Resource Adequacy in the Evolving Electricity Sector," said in part:
The NYISO appreciates the opportunity to participate in this important technical conference. It welcomes the Commission's effort to explore "the role of capacity market constructs in an environment where state policies increasingly affect resource entry and exit." The issues to be addressed in this proceeding are a key focus area for the NYISO. The current version of the NYISO's capacity market, and its mitigation rules, must continue to evolve in response to New York's clean energy mandates.
New York State has established some of the most ambitious clean energy goals in the country. Under the Climate Leadership and Community Protection Act ("CLCPA"), 70% of energy consumed must be produced by renewable resources by 2030, and all energy consumed must be emissions free by 2040. In addition, in 2019, the New York State Public Service Commission ("NYPSC") initiated its Proceeding on Motion of the Commission to Consider Resource Adequacy Matters (the "RAM" proceeding) which touches on many of the same issues that Commission is taking up now.
The NYISO's position in this proceeding is the same as in the RAM proceeding.
• The NYISO's Capacity market, the buyer-side Capacity market power mitigation measures (the "BSM Rules"), and the Energy and Ancillary Services markets must evolve and adapt to account for the clean energy transition taking place in New York. But the Capacity market is compatible with that transition and remains vitally important to support resource adequacy.
• Properly designed market structures are more efficient than non-market based alternatives. They protect consumers by shifting investment risks to investors. They are more adaptive and better suited than non-market based alternatives to manage the current clean energy transition.
• Market mechanisms will also be the better approach after the transition is complete. Even in a 100% clean energy future, harnessing market forces will be the best way to send efficient price signals, protect consumers from investment risks, and support reliability.
• Market-based resource adequacy mechanisms should evolve, not be discarded..."
Read the complete testimony here.
Additional New York ISO resource adequacy informational resources
• How We Keep the Grid Reliable in New York [blog]
• The Capacity Market's Role in Grid Reliability: Frequently Asked Questions [blog]
• NY's 2040 Power Grid: [webpage] Addressing a zero-emissions grid with market-based solutions
About the New York ISO
The New York Independent System Operator (NYISO) is a not-for-profit corporation responsible for operating the state's bulk electricity grid, administering New York's competitive wholesale electricity markets, conducting comprehensive long-term planning for the state's electric power system, and advancing the technological infrastructure of the electric system serving the Empire State.