By William Opalka

ISO-NE and the New England Power Pool Participants Committee want to begin using the RTO’s system-wide sloped demand curve in their Annual Reconfiguration Auctions.

The organizations submitted proposed Tariff changes to FERC that would apply the curve — first used in the ninth Forward Capacity Auction earlier this year — to the ARAs beginning in June 2016 (ER15-2404).

Under the current rules, demand in ARAs is represented by the fixed value of the installed capacity requirement.

The proposed changes “simply incorporate the system-wide demand curve used in an initial Forward Capacity Auction into the Annual Reconfiguration Auctions so that demand will be represented consistently in both FCAs and ARAs,” the petition said.

“Such consistency in the demand model from auction to auction avoids predictable, structural price differences,” Matthew C. Brewster, lead analyst in ISO-NE’s market development department, wrote in accompanying testimony.

Demand in import- and export-constrained capacity zones will continue to be established by local sourcing requirements and maximum capacity limits, respectively, the RTO said.

The RTO will conduct three ARAs to allow for the exchange of capacity supply obligations prior to the 2018/19 capacity commitment period covered by FCA 9.

The changes would not affect how suppliers participate in reconfiguration auctions. But unlike current rules, in which clearing occurs only through matching of counterparty offers and bids, clearing would occur using the demand curve, even without a counterparty.

The changes received the unanimous support of the NEPOOL Participants Committee and near-unanimous support from the NEPOOL Markets Committee.

Power generators have opposed a system-wide sloped demand curve and advocate a zonal demand curve to reflect capacity constraints in parts of New England. (See ISO-NE, NEPOOL Oppose Demand Curve Change.)