With its membership opened, NEPOOL sets a transmission tariff, but still must develop competitive markets. In 1993, after a series of attempts going back as far as 1971, the New England Power Pool failed to reach agreement among its members for a regional transmission arrangement. But destiny then took over (em with help from the newly enacted Energy Policy Act (em to lead pool members back to the bargaining table. Finally, on Sept. 30, 1996, NEPOOL announced that its executive committee had agreed in principle on restructuring the pool. The agreement provided for a regional transmission group and tariff, a New England independent system operator, and criteria for developing competitive markets for energy, capacity and ancillary services.
But that's just the beginning. The NEPOOL experiment must yet face its first test when it undergoes review at the Federal Energy Regulatory Commission. (See Docket Nos. 0A97-237-000, et al., filed Dec. 13, 1996.) Granted, the New England negotiators made a good-faith effort to meet all FERC requirements for open access, while taking into account the particular history of the region. But that effort could fall short of demands for quick development of an open market for bulk power, free from domination by traditional players.
Whatever the result of the FERC review, the New England system will remain a work in progress. Work will continue on developing the market. Pressure may build to simplify the transmission rules. But as this process continues, the new ISO may well prove to be the most important part of the package, exerting broad authority over the evolution of NEPOOL.