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February 19, 2020

Energy-capacity auction results in record low New England price

Photo | Contributed The Millstone Power Station in Waterford.
By Matt Pilon

Connecticut power plants and other generators have pledged to make their energy output available when needed in 2023, and for a record low price, according to regional grid and energy markets overseer ISO New England.

ISO-NE held its annual “forward capacity auction” earlier this month, through which generators and others pledge to be available to produce energy (or curtail demand) three years in advance.
In exchange for their 2023-2024 commitments, bidders who clear the auction receive monthly payments. For the recent auction, those payments are expected to total approximately $980 million.

For the 33,956 megawatts procured in the auction, the clearing price was $2 per kilowatt-month, down from $3.80 last year, and the lowest it’s been in the 14 years since the forward capacity auctions began, ISO-NE said.

The capacity obtained includes approximately 600 megawatts of new resources, including 317 megawatts of new solar, wind and energy efficiency resources. 

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