New England energy market revenues increased by roughly 150% in the winter of 2024/25 compared to the prior winter, growing from about $1.6 billion to about $4 billion, ISO-NE COO Vamsi Chadalavada told the NEPOOL Participants Committee on March 6.
The increased costs were driven by consistently cold weather, Chadalavada said, adding that this winter was the first with lower-than-normal average temperatures since 2014. Despite that, the system did not experience any capacity deficiency events and maintained adequate oil inventories, he noted.
Natural gas accounted for about 40% of the total energy, followed by nuclear around 23%, imports around 21%, hydropower around 5%, renewables around 4% and oil around 2%.
Chadalavada noted that scheduled LNG injections into the gas system increased to 22.4 Bcf compared to the five-year average of 16.6 Bcf.
Spot payments for the RTO’s Inventoried Energy Program, which compensated thermal resources for maintaining stored fuel on-site, were triggered on five days. The two-year program expired at the end of February.
ISO-NE does not plan to renew the program, which cost about $80 million per winter. The RTO noted in a memo in February that “it has not found that the program provided a notable incremental impact on the regions’ fuel inventories.”
Tariff Uncertainty
ISO-NE also spoke with the committee about the uncertainty surrounding tariffs imposed by President Donald Trump on Canadian imports.
While the RTO has argued that the tariffs should not apply to electricity, it has requested authorization from FERC to collect them in case it is directed to do so by the Trump administration. (See ISO-NE Braces for Tariffs on Canadian Electricity.)
ISO-NE and NYISO have retained an outside counsel to engage with the Department of the Treasury and plan to make the case that electricity should not be covered by the tariffs, and if it is, RTOs should not be tasked with collecting the tariffs, a representative of ISO-NE said.
The RTO’s understanding is, because the secretary of the Treasury has not issued regulations to bring electricity into the scope of the import tariffs, there is no current tariff on electricity imports, the representative noted. Neither the executive order creating the tariffs nor the notice of implementation published in the Federal Register on March 6 explicitly reference electricity.
“I think the biggest thing at this stage is that we continue to seek more clarity,” ISO-NE spokesperson Matt Kakley said.
Committee Votes
The PC voted to support ISO-NE’s compliance proposal for FERC Order 904, which prevents transmission providers from compensating generators for reactive power within the standard power factor range.
In a change from ISO-NE’s initial proposal, the RTO will still allow compensation for reactive power outside the standard range. (See NEPOOL Transmission Committee Briefs: Feb. 27, 2025.)
The committee also supported changes to ISO-NE’s billing policy to account for a recently accepted change to the RTO’s financial assurance policy allowing an affiliate company to guarantee the payment of Pay-for-Performance charges. (See FERC Approves ISO-NE Capacity Market Collateral Requirements.)
