The Winter Reliability Program for 2015/2016 through 2017/2018 addresses concerns that the region will have insufficient oil and LNG on hand when the natural gas transmission system, which supplies about half the region’s generation, is constrained. The program incentivizes generators that run on oil and liquefied natural gas to secure fuel before winter by compensating them for a portion of the costs related to any fuel inventory that is unused at the end of each winter. The Program also includes a demand-response component. All participants are subject to nonperformance charges.
Appendix K of Section III of the ISO New England Inc. Transmission, Markets and Services Tariff establishes the program rules. Per section III.K.1(g), the ISO must determine a “Set Rate” for each winter. The Set Rate calculation is initially set forth in dollars per barrel ($/bbl) and represents partial compensation for the per-barrel carrying costs of stored fuel oil. Through conversion based on a fuel oil heat content of 6.0 million British thermal units (MMBTU) per barrel, the Set Rate is translated into an equivalent rate for the other, non-oil services that are compensated through Appendix K.
The following memos to market participants define the base Set Rate plus converted Set Rates for liquefied natural gas (LNG), other stored fuels, and demand response for each winter.
The number of participants and levels of eligible participation are subject to change over the course of each program—see the program rules for details on eligibility requirements at various stages, inventory caps, etc. For the 2017/2018 winter program, the table reflects the status as of 6/11/18. For context, read, “Update on the 2017/2018 Winter Reliability Program.” For the 2016/2017 winter program, the table reflects final results as of 4/20/17. For the 2015/2016 winter program, the table reflects final results as of 9/9/16.
|
Type |
Program |
Participants |
Amount eligible for compensation |
Payment rate |
PROGRAM USAGE (Oil Inventory Changes, LNG Usage, and DR Events) |
program costs* |
|
Oil |
2017/2018 |
86 units |
2.867 million barrels |
$10.33 per barrel |
December: 548,410 barrels January: 524,447 barrels |
$24,535,344 (after penalties of $2,075,709) based on 2,576,094 barrels of unused eligible inventory at program end |
|
2016/2017 |
84 units |
3.052 million barrels |
$10.21 per barrel |
114,010 barrels (December: 76,967; January: 12,737; February: 18,663; March 1–15: 5,643) |
$30,309,795 (after penalties of $674,169) based on 3,034,668 barrels of unused eligible inventory at program end |
|
|
2015/2016 |
77 units |
2.954 million barrels |
$12.90 per barrel |
254,845 barrels (December: 21,251; January: 75,277; February: 153,985; |
$35.91 million (after penalties of $1.26 million) based on 2,881,550 barrels of unused eligible inventory at program end |
|
|
LNG |
2017/2018 |
0 units |
0.0 MMBtu |
$1.72 per MMBtu |
None |
$0.00 |
|
2016/2017 |
2 units |
171,000 |
$1.70 per |
None |
$277,868 (after penalties of $13,037) |
|
|
2015/2016 |
8 units |
1.278 million MMBtu |
$2.15 per MMBtu |
None |
$2.58 million |
|
|
DR |
2017/2018 |
3 assets |
7.5MW |
$1,033 per MW-month, plus energy payments, if dispatched |
None |
$34,177 ($13,946 monthly payments; $20,232 energy payments) |
|
2016/2017 |
6 assets |
23 MW |
$1,021 per MW-month, plus energy payments, if dispatched |
All assets dispatched 6:39 a.m.–9:04 a.m. on 1/10/17 |
$128,220 ($85,764 monthly payments; $42,456 energy payments) |
|
|
2015/2016 |
6 assets |
26.5 MW |
$1,290 per MW-month, plus energy payments, if dispatched |
All 26.5 MW dispatched for three-hour period 1/5/16 |
$211,107 |
*For oil and LNG, program compensation is based on unused eligible inventory at the end of each winter. See the program rules for other factors that go into the calculation of program payments, such as resource types, inventory caps, and performance requirements.
