ISO New England last Tuesday warned FERC that a loss of power supplied by various power plants owned by bankrupt NRG Power Marketing Inc. in the region “could result in blackouts over a considerable area of the New England bulk power grid, including areas outside the immediate region where the assets are located.”

NRG Power Marketing recently warned FERC that if it is forced to continue supplying power to Connecticut Light & Power Co. (CL&P) under a standard offer service agreement, NRG Power Marketing will be facing permanent insolvency in a matter of weeks and possibly complete liquidation. That, in turn, could take as much as 6,700 MW off the market in New York and Connecticut later this summer.

The unavailability of some or all of NRG Power Marketing’s power plants in New England during the peak summer period “would violate accepted reliability criteria and risk potentially substantial service disruptions,” ISO New England told FERC in its July 15 filing.

ISO New England noted that the power grid in the southwestern region of Connecticut poses “persistent and major threats” to reliable electricity service in the Southwest Connecticut subregion, the state of Connecticut as a whole and the New England region.

In its July 8 filing, NRG Power Marketing outlined a number of scenarios that could lead to the potential unavailability of the company’s New England generation assets if the CL&P contract isn’t terminated.

Among other things, NRG Power Marketing said that the complex functions performed by the company can’t be readily replaced and that there would likely be a “gap period” between the time that NRG Power Marketing ceased to function and the time that a replacement entity or process could be established.

ISO New England encouraged FERC to “take any actions it can to reduce the risk of reliability problems in New England.” The grid operator said that such actions should ensure one of two results — either NRG Power Marketing can obtain additional financing and continue to function as a viable entity or prompt action is taken to ensure that an alternative plan is developed that will eliminate the risk of a “gap period.”

Five NRG Northeast Generating LLC subsidiaries own power plants in Connecticut:

Along with these plants, NRG Northeast Generating indirectly owns power plants in New York and Massachusetts.

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