New England Governors Call For "Reform" Of ISO New England Market Design

October 15, 2020

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Reporting by Paul Ring • ring@energychoicematters.com

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Connecticut Governor Ned Lamont, Maine Governor Janet Mills, Massachusetts Governor Charlie Baker, Rhode Island Governor Gina Raimondo, and Vermont Governor Phil Scott are calling for reform of the regional electricity market design, transmission planning process, and the governance of the ISO-New England, the independent system operator for the New England power system.

A vision document outlining specific areas for reform will be released later this week through the New England States Committee on Electricity (NESCOE)

"When Connecticut deregulated our electricity sector, we were promised competition, lower risk for ratepayers, more affordable electricity, and a system that respects and accommodates our clean energy mandates," Governor Lamont said. "What we got is a system that has actively hindered our efforts to decarbonize the grid, and imposed burdensome costs on Connecticut ratepayers to fix market design failures. Working together with our neighboring states, I’m committed to achieving a regional electricity grid that provides the affordable, clean, and reliable electricity that Connecticut families and businesses deserve."

The five governors said that, "Going forward, we require a regional electricity system operator and planner that is a committed partner in our decarbonization efforts," and one which will:

• "Proactively develop market-based mechanisms, in concert with state policymakers, that facilitate growth in clean energy resources and enabling services, while fully accounting for on-going renewable energy investments made pursuant to enacted state laws;

• "Conduct best-in-class system planning activities that proactively address our clean energy needs;

• "Ensure grid resiliency and reliability at least cost in a manner that is responsive to state and consumer needs; and

• "Adopt an organizational mission and structure to reflect our energy transition and establish a higher degree of accountability and transparency to the participating States and other stakeholders."

"Today’s wholesale electricity market and organizational structures: (1) are based on a market design that is misaligned with our States’ clean energy mandates and thereby fails to recognize the full value of our States’ ratepayer-funded investments in clean energy resources; (2) lack a proactive transmission planning approach and tools that facilitate the development of a future system with more clean, dynamic and distributed resources; and (3) are based on a governance structure that is not transparent to the states and customers it serves, with a mission that is not responsive to States’ legal mandates and policy priorities. Recognizing these shortfalls, it is time to make the necessary changes to meet the challenges of our 21st century energy transition," the governors said

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