Uniform electricity markets across the Northeast andMid-Atlantic regions moved one step closer to becoming reality onThursday as electricity market administrators, Independent SystemOperator (ISO) New England Inc. and PJM Interconnection LLC,reported that they have teamed up with systems developer ALSTOMESCA Corp. with the intent to formalize an agreement that willstandardize their electricity markets. The ISOs also believe themodel could be adopted by wholesale markets across the country.

In a letter sent by ISO New England to the Federal EnergyRegulatory Commission, the administrator outlined a wholesalemarket program that would include features of both its own designas well as the current PJM market model. The end result called theStandard Market Design for wholesale electricity markets could thenbe used as a model for the rest of the country.

“This new market standard should put into place the necessarymarket improvements more quickly and at a reduced cost than if wewere to implement a customized market system for New England,” saidWilliam W. Berry, chairman of ISO New England. “Now is the time tostop the experimentation. Ultimately, we hope the Standard MarketDesign will serve as the benchmark for wholesale electricitymarketplaces across the country, if not around the world.”

Under the agreement currently in the works, ISO-NE will purchasethe current PJM market design and certain software components fromALSTOM and PJM. The two ISOs and ALSTOM will then work together todevelop a standardized market design that includes solutions toreserve markets and a common solution to unit dispatch.

Phillip G. Harris, chairman of PJM, said “PJM is very excited tofurther standardize a design for a competitive wholesaleelectricity market. Along with the progress in the implementationof the PJM West concept, this initiative will provide an evenbroader standardized market design.”

The companies also said that the approach should furtherexpedite the elimination of trading barriers across differentmarkets and promote FERC’s goal of creating a seamless marketplace.ISO New England and the New York ISO will continue to work togetheron these issues under a joint board resolution passed on Jan. 16.

“Because of our geographic location, New York is in the centerof the Northeast markets, with ISO New England, PJM and IMO each onone of our borders. We support the continued elimination ofbarriers across Northeast trading markets to develop a moreseamless marketplace where everyone will benefit,” said William J.Museler, CEO of the New York ISO.

The administrators said the proposed market design standard willbe developed jointly with stakeholder input. ISO New England saidit plans to propose the Standard Market Design to the New EnglandConference of Public Utility Commissioners and the New EnglandPower Pool in a series of meetings next week. Additional meetingswill be conducted in the next few weeks. The Standard Market Designfor New England will be subject to FERC approval.

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