FERC Allows ISO-New England To Integrate DR Into Wholesale Markets
January 15, 2015
The Federal Energy Regulatory Commission has authorized ISO-New England to fully integrate demand response into the grid operator’s wholesale markets, in spite of uncertainty over a court’s decision to vacate Order 745. Some of the tariff changes have already gone into effect in advance of ISO-NE’s forward capacity auction scheduled for next month. The New England Power Generators Association (NEPGA) had asked regulators to delay a decision because a federal appeals court held that FERC lacked jurisdiction to regulate rates for supply-side demand response resources. According to NEPGA, the decision extended to all FERC-jurisdictional markets, including the forward capacity and forward reserve markets. While acknowledging that the appeals court decision “creates uncertainty for demand response resources in FERC-jurisdictional wholesale markets,” the commission said it was appropriate to proceed with ISO-NE’s market enhancements until further action was taken. The Obama administration has indicated it will take the appeals court decision to the U.S. Supreme Court.