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New England Grid Operator Increasingly Worried About Operational Reliability This Winter

In light of the potential effects of Hurricanes Katrina and Rita on fuel supplies and tightening supplies of natural gas in the Northeast generally, ISO New England (ISO-NE) "is becoming increasingly concerned about the operational reliability of the New England system during the upcoming winter," the grid operator disclosed in a recent filing submitted to federal energy regulators [ER03-563-053].

While ISO-NE has continued to work towards implementation of a Southwest Connecticut (SWCT) energy load zone, "new developments now require the ISO to redeploy its internal resources that have been devoted to that project to issues that could impact reliability in New England this winter," the grid operator said in its Sept. 26 filing at FERC.

"Significant internal resources are required to assess the potential impacts of these developments and to undertake any projects necessary to mitigate their effects and to ensure reliability," ISO-NE added. "Prudence requires the ISO to undertake this shift of resources immediately so that any measures identified as necessary can be developed and implemented in a timely manner."

Therefore, ISO-NE is suspending work on the implementation of a SWCT energy load zone, "which, depending on the Commission's guidance, may not even be imminent, and is instead focusing those internal resources to explore several potential projects that might be necessary to address the potential reliability issues that could result from" supply issues detailed in the filing.

In August, FERC postponed LICAP implementation, if it proceeds, until no earlier than Oct. 1, 2006 instead of January 2006 as originally scheduled. The plan was previously filed by ISO-NE.

ISO-NE subsequently filed a motion for clarification in response to FERC's August order. The grid operator specifically asked FERC to clarify when it must implement a separate energy load zone for SWCT. In its Aug. 31 filing, ISO-NE further requested the Commission provide the requested clarification within 60 days of the date of the filing. "If the requested clarification is not received by that time, the ISO will continue treating Connecticut as a single load zone for the purposes of the long-term FTR [financial transmission rights] auction for 2006," the grid operator said this summer.

In its filing last week, ISO-NE said that because of the necessary reallocation of internal resources, if the Commission does direct that the SWCT energy load zone be implemented on Jan. 1, 2006, ISO-NE requires notice prior to the timeframe requested in the motion for clarification, "and so now requests expedited review of that motion. If the Commission does direct the ISO to implement the SWCT energy load zone on January 1, 2006, the ISO urges the Commission to do so no later than October 11, 2005."

Action by that date will allow the grid operator "to again refocus its resources on implementing a SWCT energy load zone on January 1, 2006 if so directed. The ISO also requests that the Commission shorten any comment periods as necessary to provide the requested guidance by October 11, 2005."

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