As expected, ISO New England’s (“ISO-NE”) recent Forward Capacity Auction (“FCA”) 15 resulted in higher capacity clearing prices than FCA 14. The auction, consisting of five rounds of bidding, concluded on February 8th with preliminary clearing prices ranging from $2.48/kW-month to $3.98/kW-month, depending on zone. These prices represent a significant increase from FCA 14, when all zones cleared at $2.00/kW-month, the lowest ever. These recently cleared prices also ended a five-year streak of ISO-NE capacity price decreases, following a high of $10.00/kW-month in FCA 9.
The FCA 15 cleared capacity prices and resources represent the resources needed to meet consumer demand in the years 2024 and 2025. 34,621 MW of total capacity cleared the auction, higher than the 33,270 MW target. Of the total cleared capacity, 950 MW is from new resources. Notably, 630 MW of battery storage capacity cleared the auction, representing the first-time energy storage resources had done so. Preliminary estimates put the total value of the capacity market in 2024-2025 at $1.36 billion. Final auction results will be filed with the Federal Energy Regulatory Commission (“FERC”) by the end of this month.
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