AS THE NEW ENGLAND GOVERNORS and Eastern Canadian premiers meet at their annual gathering this week, the New England Power Generators Association and the COMPETE Coalition would like to take an opportunity to underscore that these talks come as electricity and natural gas prices are at historic lows in New England.

June’s average wholesale electricity price was the lowest since the ISO New England markets began as we know them in 2003. Despite historic winter weather in New England four of the six lowest average price months for wholesale electricity have occurred in 2015. ISO New England has cited abundant natural gas supplies, low fuel prices and low demand levels as driving the electricity price decrease with the average price of natural gas in June ($1.63/MMBtu) also the lowest since 2003.

The open, competitive market in New England is also driving investments to keep power supplies in the region competitively priced and reliable. In July alone New England saw an unprecedented amount of new resource investment based here in the region all being pursued as market-based investments at the developer’s risk without a state-subsidized contract:

  • NRG announced it was repowering its Canal power plant in Sandwich, MA, targeting a completion date of June 2019.
  • Emera Energy announced it is making an $80 million investment in its Tiverton, RI plant to increase efficiency, boost capacity and improve emissions.
  • Invenergy announced its intention to develop a 900-MW power plant in Burrillville, RI to become commercial in June 2019. (all projects listed pending regulatory approvals)

These summer announcements are in addition to more than 1,800 MW of new supply projects currently under development that have cleared the forward capacity market in recent years – 750 MW in Salem, Massachusetts, 815 MW in Oxford and Wallingford, Connecticut, and 190 MW in Medway, Massachusetts. What all these investments have in common is reliance on market fundamentals and putting their own capital at risk, without the promise of a long-term contract or ratepayer guarantees.

As these projects move forward, only the most cost-effective supply sources will be selected to meet consumer needs. The New England competitive electricity market is driving competitive pricing, reliability, and environmental improvements for consumers. We hope the New England states continue supporting these types of New England-based investments to keep prices competitive and support thousands of local jobs.

A recent study prepared for the COMPETE Coalition looked at empirical data over the past two decades to conclude that customers in states with workably competitive electricity markets – including New England states – were better off in terms of price, investment, and reliability than were customers in states with government-managed electricity monopolies.

New England’s competitive energy marketplace is working and delivering value and sustainability to consumers. Allowing these markets to continue to work is the best path forward for New England’s energy consumers and the region’s economy.

Dan Dolan is president of the New England Power Generators Association and William Massachusetts is the counsel to the COMPETE Coalition. 

5 replies on “Power prices at historic lows”

  1. Bad news for solar and wind? Doesn’t this make them even less price competitive without huge subsidies from taxpayers and ratepayers?

  2. Remember, the price for fuel for solar and wind is 0. So any price paid above 0 for the power is good.

    For natgas, you have to get more for power than you paid for the gas.

  3. I regret to inform you that Eversource is forced to pay more than $0 to solar and wind electric producers. We could only wish for that. Instead, ratepayers are put over the barrel paying them rates nearly double what electricity costs from natural gas.

  4. It’s regrettable that no mention is made of state mandates for wind and solar energy, and how these mandates are distorting the markets forcing the early retirement of coal and nuclear. The Green Communities Act, and the Global Warming Solutions Act are distorting the market into a future make up of Natural Gas (NG), wind, solar, and hydro from Canada.

    We will be over dependent on NG for electricity and heat in the winter. Winter price hikes and shortages will be inevitable. The plan to increase NG pipeline capacity at ratepayers expense will give us skyrocketing rates and little relief from shortages.

    The energy markets have worked well so far keeping rates low. But, the distortions forced on the market by wind and solar, will ruin that record for the future.

    Tell Beacon Hill to stop pushing wind and solar. When the time is right, the market will welcome them on the grid.

  5. Pingback: Energy News for week ending September 4, 2015 | New England Energy News

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