KENNEDY, MARKEY CALL ON REGULATORS TO REVIEW REGIONAL ENERGY CAPACITY MARKETS
Washington, DC – Continuing their call for reforms to New England’s energy capacity markets, Congressman Joe Kennedy III and Senator Edward J. Markey led the Massachusetts delegation and other colleagues from the region in urging ISO-New England (ISO-NE) and the Federal Energy Regulatory Commission (FERC) to consider stronger protections for consumers in future auctions. Specifically citing the results of last month’s Forward Capacity Auction (FCA10) and two ISO-NE filings late last year, the lawmakers again expressed their frustration that the current structure and policies do not provide electric reliability at just and reasonable rates for consumers.
“A system that fails to take consumer impact into account is simply a system that doesn’t work,” said Congressman Joe Kennedy III. “With our region’s energy bills already the highest in the continental United States and set to increase due to previous capacity auctions, stakeholders and regulators must come together to reform these markets in a way that protects ratepayers and incents future generation. The results of FCA10 and both ISO-NE filings demonstrate flaws in the current system and our delegation will continue to call on regulators to address these concerns.”
"Problems with the markets intended to secure future electricity generation in New England can have major impacts on consumers,” said Senator Edward J. Markey. “Recent filings by ISO-New England are the smoking guns confirming that there are potentially serious issues with how these markets are functioning, and it is consumers who will pay the price. New England already has some of the highest electricity rates in the nation. The current system appears to be flawed, and we need to ensure that electric ratepayers are protected from ballooning costs in the coming years.”
In separate filings with FERC in December 2015, ISO-NE indicated that both FCA8 and FCA9, which initially fell short of meeting generation targets, now have sufficient generating capacity after taking into account updated renewable resources and improvements to the grid. In their letter, the legislators also raised concerns that ISO-NE offered no recourse for consumers who will pay higher rates due to those initial shortfalls. The second filing cited the possibility for market actors to utilize the retirement process to increase costs for ratepayers for their own benefit, a concern which the New England delegation repeatedly raised with ISO-NE over the last two years. To read the full letter, please click here.
Both Congressman Kennedy and Senator Markey have introduced the Fair Ratepayer, Accountability, Transparency and Efficiency Standards (RATES) Act, which would ensure that consumers can always have a mechanism to appeal energy rate changes filed with FERC. Yesterday, the Fair RATES Act passed the House of Representatives unanimously and now awaits a vote in the Senate. The lawmakers also recently wrote a letter to President Obama highlighting the vacancy at FERC that limits the commission’s ability to rule whether rates are just and reasonable.