Finding the 'Sweet Spot'

Fortnightly Magazine - May 2008
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As president and CEO of ISO New England, Gordon van Welie has his feet planted firmly on each of two sides of a cultural divide. First, as a transmission system operator, van Welie must keep the lights on and the wires humming—a conservative agenda dictated by long-established engineering concepts where even a moment’s failure can and does lead to political repercussions.

At the same time, however, he must run a regional market—an ongoing experiment in freewheeling capitalism in an industry fraught with more long-term uncertainty than perhaps any other.

Fortnightly: I’m hearing through the grapevine that your recent auction in the forward capacity market was “hijacked” by a huge wave of demand-side bidding. My sources tell me these bids pushed the price so low that some power producers—hard asset owners—are left asking, “What’s in it for me?”

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