With measures in place to ensure the reliability of New England's electric grid for the coming winter season, grid operator ISO New England, Inc. expects to have adequate electricity supplies this winter -- but according to a recent presentation to federal regulators, the biggest challenges could come in the form of extended cold weather when fuel inventories are already depleted or a day when gas supplies are constrained and suddenly a large non-gas resource is lost.
According to an October 19, 2017 presentation by ISO-NE to the Federal Energy Regulatory Commission, in 2016 nearly half of the electricity produced in New England came from natural gas, and the availability of gas impacts both grid reliability and production costs. At the same time, the gas pipeline infrastructure serving New England is limited, with pipelines reaching their maximum capacity at times including winter months when demand peaks for gas for heating.
In response to concerns over reliability and past events like the January 2004 "cold snap" and the 2014 "polar vortex", ISO-NE has taken steps including developing operating procedures, a Winter Reliability Program and "Pay for Performance" changes to market rules that incentivize investment in operational improvements and secure fuel arrangements, as well as improving communication and coordination with generators, pipelines, and other stakeholders.
With those measures in place, ISO-NE recently told the Commission it expects to have adequate electricity supplies this winter, but that gas pipeline constraints continue to be a concern. ISO-NE noted that while Spectra Energy placed its Algonquin Incremental Market project in service providing some relief last winter, that relief "was short-lived due to the retirement in 2017 of more than 1,500 MW of non-gas units (Brayton Point Power Station)." The grid operator also noted that "LNG shipments are unknown" and that "Non-gas resources will continue to play a vital role in maintaining reliability."
Citing the biggest challenges this winter as extended cold weather when fuel inventories are depleted or a day when gas supplies are constrained and the region is using primarily nuclear, coal, and oil resources and suddenly a large non- gas resource is lost, ISO-NE noted that while the region has adequate generating capacity to serve load under those conditions, "the ability to meet energy needs is at risk if gas cannot be supplied to gas-fired generators."