By William Opalka

FERC accepted the results of ISO-NE’s 10th Forward Capacity Auction last week, again rejecting allegations of market manipulation and concluding that the prices were just and reasonable (ER16-1041).

The auction, covering the 2019/20 commitment period, saw prices drop to $7.03/kW-month from last year’s $9.55/kW-month. It was the first decline in four years. (See Prices Down 26% in ISO-NE Capacity Auction.)

The Utility Workers Union of America has claimed the Brayton Point generating plant in Massachusetts has been withheld from the last three auctions to drive up capacity prices. The plant, purchased by Dynegy in 2015 from Energy Capital Partners, is scheduled to close next year. (See FERC Again Rebuffs Brayton Point Union.)

“We emphasize, as the commission has stated in previous orders, that the commission’s Office of Enforcement reviewed Brayton Point’s bidding behavior in FCA 8 to determine whether further investigation of Brayton Point was warranted and ‘found credible justifications for the owners’ retirement decision and elected not to widen its investigation to include Brayton Point,’” FERC said. “We are not persuaded by Utility Workers Union’s allegations that market manipulation affected FCA 10, as the record is devoid of any evidence to that effect, and we similarly reject Utility Workers Union’s request for a stay pending discovery and further adjudication of that allegation.”

The commission also said that a “rigorous” review by ISO-NE’s Internal Market Monitor determined FCA 10 was competitive.

FERC Backs ISO-NE in Tariff Dispute

In a separate order, the commission rejected a complaint that alleged ISO-NE violated its Tariff when it refused to qualify an increase in a Massachusetts generating plant’s output for FCA 10 (EL16-48).

Northeast Energy Associates, owner of the Bellingham generating station, agreed with ISO-NE that an additional 10 MW of capacity was a “significant increase” but disagreed on whether it should be treated as new or existing capacity. New capacity is required to submit a composite offer linking incremental summer qualified capacity to existing winter qualified capacity.

NEA said the 10 MW should have been added to the existing summer qualified capacity without a composite offer and asked the commission to order ISO-NE to include the increase as if it had cleared FCA 10 — a move that would result in capacity payments to NEA of almost $844,000.

FERC sided with ISO-NE, saying that NEA, which is owned by subsidiaries of NextEra Energy and GDF SUEZ Energy Resources, misread the Tariff.

“We agree with ISO-NE that … the Tariff is clear that a significant increase must abide by all the provisions applicable to a new generating capacity resource,” FERC wrote.

This is the second time FERC has addressed a capacity increase for Bellingham. Previously, FERC granted a waiver to allow the plant to participate when the company submitted a late interconnection deposit. ISO-NE wanted to disqualify the resource, but the commission said a good-faith effort was made to submit a timely payment after NEA discovered its oversight. (See FERC Overrides ISO-NE, Grants Waiver for Late Capacity Payment.)