FERC has again upheld the ISO-NE limited exemption for renewables from the RTO’s minimum offer price rule, saying it was necessary to protect consumers from paying for excess capacity (ER14-1639).

The commission voluntarily agreed to reconsider the issue after NextEra Energy and other generation owners asked the D.C. Circuit Court of Appeals to review FERC’s January 2015 order rejecting their challenge of the exemption (15-1070).

The generators claimed the exemption, which is limited to 200 MW annually, suppressed clearing prices in the Forward Capacity Market. The exemption was contained in an order in which FERC accepted ISO-NE’s compliance filing in response to the commission’s requirement for a sloped demand curve.

The companies had relied on a previous FERC order that recognized that exemptions could suppress capacity prices. However, the commission said that a unique set of facts presented in a specific case could justify an exemption.

“The renewables exemption fulfills the commission’s statutory mandate by protecting consumers from paying for … capacity that cleared through the [Forward Capacity Auction] and separately paying for renewable resources built by state entities to meet state policy objectives,” FERC said.

– William Opalka