FERC Approves CASPR, ISO-NE’s New Forward Capacity Auction
On March 9, 2018, the Federal Energy Regulatory Commission (FERC), in a split decision, approved ISO-New England Inc.’s (ISO-NE) proposed tariff revisions to accommodate entry of additional clean energy resources into the Forward Capacity Market (FCM). ISO-NE’s Competitive Auctions with Sponsored Policy Resources (CASPR) revises the Forward Capacity Auction (FCA) rules to include a secondary auction to “facilitate the transfer of capacity supply obligations (CSOs) from existing capacity resources, which commit to permanently exit ISO-NE’s wholesale markets” to new, state-incentivized clean energy resources known as “Sponsored Policy Resources.”
Existing resources that shed their CSO in the substitution auction will retain a one-time “severance payment” for the difference between the clearing prices in the primary and substitution auctions. With the exception of approved tariff changes regarding FCM settlements, CASPR takes effect immediately, to coincide with the start of the year-long auction administration cycle for FCA 13.
FERC’s order is an important one, as it approves tariff revisions that reconcile