NEPGA Files Comments in Support of Energy Efficiency Proposal – Docket No. ER21-943-000

On February 16, 2021, NEPGA filed Comments in support of ISO-NE’s proposal to exempt energy efficiency resources for Pay for Performance charges and payments due to a Capacity Scarcity Condition that occurs in a peak load hour (Docket No. ER21-943-000). Energy efficiency resources are presently exempt from such charges and payments for Capacity Scarcity Conditions that occur in all non-peak hours of the year. The changes ISO-NE proposes herein will have the effect of entirely exempting energy efficiency resources from PFP payments and charges. NEPGA offers several reasons for its support. First, energy efficiency resources cannot deliver energy or reserves in real-time, and thus are not responsive to the price signals the PFP design sends to incent capacity resource performance. It is thus entirely reasonable to eliminate exposure to price signals that have no consequence on incremental actions, and thus on the incremental real-time reliability benefit of a resource to which those price signals currently apply. Second, the changes proposed by ISO-NE are consistent with the Commission’s prior findings and reasoning in accepting the PFP design, namely that energy efficiency resources are appropriately compensated for their contributions to resource adequacy through the Forward Capacity Auction “base payments.” Third, in no longer applying PFP charges and payments to energy efficiency resources, ISO-NE appropriately recognizes that these resources should likewise not be subject to the financial assurance requirements of resources exposed to PFP charges.  ISO-NE thus proposes the necessary and just and reasonable changes to ISO-NE’s financial assurance policy. ISO-NE filed the proposed changes on January 26, 2021, under FPA Section 205. FERC thus must issue an order on the proposed changes by March 30 or they will go into effect by operation of law.



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