Public Utilities Reports

PUR Guide 2012 Fully Updated Version

Available NOW!
PUR Guide

This comprehensive self-study certification course is designed to teach the novice or pro everything they need to understand and succeed in every phase of the public utilities business.

Order Now

Category Error

The trouble with treating grid projects as market players in New York’s capacity auction.

Fortnightly Magazine - December 2013
This full article is only accessible by current subscribers. Please login to view the full content.
Not a subscriber yet? Click here to subscribe for one year of Fortnightly Magazine, and gain access to the entire Fortnightly article database online for you and three of your coworkers.

New York City, according to Sir Peter Hall’s epic 1998 survey, Cities in Civilization , is the “apotheosis of the modern.” Hall cites New York City’s unique geography as compelling technological fixes, and thus New York engineers invented the air brake (Westinghouse), the telephone (Bell), the electric light (Edison), the fountain pen (Waterman), the adding machine (Burroughs) and the linotype (Mergenthaler). Over time, cities age and sometimes ossify, as seen in Detroit. Cities have to reinvent themselves, and that reinvention includes their basic infrastructure: they have to renew roads, bridges, power lines, and water systems. 

Superstorm Sandy’s high winds and severe flooding revealed the fragility of New York City’s electricity infrastructure. Sandy was only the latest chapter in a prolonged review of the electric transmission system that has been underway since the Northeast Blackout of August 14, 2003. For more than a decade, the challenge has been where and how to invest intelligently in transmission. In the New York metro area, the challenge has been met in different ways by the different regulatory and political processes that govern transmission. Since 2003, in the New York City and Long Island area, only two major transmission projects – the Neptune and Hudson High Voltage Direct Current (HVDC) systems – have been commissioned and built. Connecticut, part of the New England power grid, has invested $1.9 billion in transmission projects. New Jersey, part of the mid-Atlantic power grid, has also added modestly to the expansion and renovation of its metro area transmission grid.

These references to different transmission grids highlight something distinctive about the New York metro area: New York is the only mega-city whose broader metro area is largely located, not only in other states, but also in other power pools. Seen from the “tri-state” perspective, the New York metro area’s transmission grid is defined by three completely different planning processes that determine what transmission must be built to keep the metro area’s lights on: in Connecticut, the process is administered by the Independent System Operator of New England (ISO-NE). New Jersey’s power grid is administered by the PJM RTO. New York City and Long Island’s transmission systems are administered by the New York Independent System Operator (NYISO).

Figure 1 - NYC vs. Upstate Demand Curves

An effort to amalgamate these three areas into a single ISO is now lost in the mists of time. Each RTO-ISO was spawned by efforts sponsored by the Federal Energy Regulatory Commission (FERC) back in the late 1980s and 1990s. The federal effort was motivated by the reality that electricity trade was inevitably an interstate activity, and hence ultimately under the purview of the federal

This full article is only accessible by current subscribers. Please login to view the full content.
Not a subscriber yet? Click here to subscribe for one year of Fortnightly Magazine, and gain access to the entire Fortnightly article database online for you and three of your coworkers.