New England should have enough power to keep homes and businesses warm this winter, but constraints on natural gas pipelines could pose a challenge, the region’s grid operator said Tuesday.
ISO New England said it has put another Winter Reliability Program in place to help keep the lights on when the weather turns cold.
“Winter has become a challenging time for New England grid operations,” said Vamsi Chadalavada, executive vice president and chief operating officer of ISO New England.
“Especially during the coldest weeks of the year, the natural gas infrastructure in New England is inadequate to meet the demand for gas for both heating and power generation.”
The independent system operator has identified more than 4,000 megawatts of gas-fired generation that is “at risk of not getting sufficient fuel on any given day,” Chadalavada said.
This winter’s reliability program, like last year’s, provides incentives to oil-fired power plants and gas generators that can access liquefied natural gas to stock up enough fuel before winter begins.
Spot gas prices in New England spiked to more than $78 per million Btu on one of the coldest days in January 2014 when gas supplies to generators ran short as most of the fuel was being used to heat homes and businesses.
Even though the weather was just as cold last winter as in 2013-14, prices this year topped out at around $30 per million Btu in February because the winter reliability program made New England generators less dependent on gas from the pipelines.
Spot gas prices averaged $13.82 in January and February when generators bought oil and LNG before the weather turned cold, under a reliability program similar to the latest one. That compared with an average of $24.09 during the same two months in 2014 under an older version of the program.
More than 45 percent of the total generating capacity in New England uses gas as its primary fuel.
ISO New England forecast demand this winter will peak at 21,077 megawatts under normal winter temperatures, or 21,737 megawatts under extreme cold conditions. New England has 32,872 megawatts of generation.
Last winter, demand peaked at 20,583 megawatts on Jan. 8, well short of the region’s all-time winter peak of 22,818 megawatts in 2004.