New resources that want to participate in the Forward Capacity Market (FCM) must submit documentation indicating the resource’s ability to operate at a specific megawatt value for the relevant capacity commitment period. ISO New England evaluates this information to confirm capacity.
The first step in qualifying a new resource is submitting a New Capacity Show-of-Interest (SOI) form with project information via the Forward Capacity Tracking System (FCTS).
Regarding substitution auction participation: Beginning with the February 2019 annual Forward Capacity Auction (FCA), new renewable, clean, or alternative resources that receive revenue from state or municipal governments outside of ISO markets (“sponsored policy resources”) can elect to participate in a substitution auction. Be aware that some of the deadlines overlap with those for the primary auction. See the FCM Substitution Auction Overview and Timeline and Supply Participation in the FCM Substitution Auction for details.
A new generator must have a valid and active interconnection request in place by the close of the SOI submission window, regardless of interconnecting jurisdiction. For details, see the following sections of the Open Access Transmission Tariff (OATT): Schedule 22, Large Generator Interconnection Procedures; Schedule 23, Small Generator Interconnection Procedures; and Schedule 25, Elective Transmission Upgrade Interconnection Procedures.
Projects that don’t fall under the jurisdiction of the Federal Energy Regulatory Commission (“non-FERC jurisdictional projects”) must provide a copy of the interconnection application submitted to the local utility entity specifying the point of interconnection, substation name, and/or distribution feeder number. The specific project tracking number used by the local utility entity during the interconnection process should also be provided. The local utility entity is responsible for determining whether the resource is FERC or non-FERC jurisdictional.
Generators that submitted an SOI in the last qualification cycle but withdrew, didn’t clear, or only partially cleared can reuse the information in that SOI. See the carryover instructions.
Note that there are two types of new generating resources:
An SOI can be submitted for a new generator that hasn’t previously cleared in an FCA.
Certain kinds of existing generation may also seek qualification as a new resource:
*For the specific amount per kilowatt, see the cost threshold adjustment parameters for each FCA available on the FCM Parameters section of the FCM webpage. These thresholds are based on the Handy-Whitman Index of Public Utility Construction Costs—details below.
FCA qualification price thresholds are adjusted annually using the most recent Handy-Whitman Index of Public Utility Construction Costs. These thresholds apply to existing generation seeking qualification as a new resource based on:
See Market Rule 1, Sections 18.104.22.168.2 to 22.214.171.124.4 for details.
The Handy-Whitman Index is derived from cost trends in public utility construction. The ISO uses the index’s data on “Total Other Production Plant” costs (construction and equipment) in the North Atlantic region.
As the first year of the FCM, 2008 serves as the benchmark year. The cost-threshold adjustment parameters used in FCM qualification are as follows:
The cost-threshold adjustment formula: benchmark year costs x (variable index value ÷ base index value).
For example, for the FCA to be conducted for capacity commitment period (CCP) 2022–2023 (FCA #13), thresholds are calculated as follows:
These adjusted qualification thresholds for each FCA are available on the FCM Parameters section of the FCM webpage.
The Handy-Whitman Index publisher, Whitman, Requardt & Associates, LLP, has granted the ISO permission to distribute data.
The SOI is due approximately nine months before the FCA. Check the dates for the SOI submission window in the appropriate FCA calendar. (Learn how to access the auction calendars.)
When the SOI window is open, project sponsors can enter an SOI application via the Forward Capacity Tracking System (FCTS). (A digital certificate is required to access FCTS. Your security administrator for the ISO’s Customer and Assets Management System [CAMS] can provide this.)
To submit the SOI:
See the sample show of interest application form in Appendix C of Planning Procedure No.10 (PP-10). The form for generators requests information including, but not limited to, the following:
Note: Additional information for new generation projects beyond what the FCTS requests should be provided using the “New Generation Project Form: Supplemental Information for Direct Connect Review” and uploaded as additional “Interconnection Study” documentation in the FCTS during the SOI submission process.
In some cases, a new resource can reuse a previously submitted show of interest.
You can reuse an SOI for a project if both of the following are true:
If the resource partially cleared, the megawatts that didn’t clear can carry over to the next CCP. The project name and ID from the previous CCP will be retained when carrying over an SOI. Updates to carryover SOIs are permitted as long the SOI window is still open.
For screenshots of the carryover process, see the “New Generation and Imports Show of Interest (SOI)” or “Demand Capacity Resources Show-of-Interest (SOI)” training. Both are available on the Training Materials webpage.
With each show of interest (SOI), the project sponsor must submit a refundable qualification process cost-reimbursement deposit (QPCRD). The deposit is used for costs the ISO and its consultants incur, including affected transmission owners’ documented and reasonably-incurred costs associated with the qualification process.
Use the appropriate form available on the Financial Assurance and Credit page to set up payment for the QPCRD.
For the amount required, see the table in Market Rule 1, Section III.126.96.36.199, Qualification Process Cost Reimbursement Deposit.
The QPCRD is due after the close of the show-of-interest window. (Learn how to access the auction calendars.) The ISO will issue an invoice, usually in early May.
If the ISO does not receive the QPCRD by the deadline, the project will be withdrawn.
The remaining balance of the QPCRD is returned under the following conditions:
If a project is denied qualification for the current CCP (CCPn) and does not carry over its SOI for the next CCP (CCPn+1), the QPCRD will be returned after the SOI window for the next CCP (CCPn+1). With the exception of QPCRD returns for achieving FCM commercial operation, all returns will be processed twice per year during the May (following the close of the SOI submission window) and November (following the completion of the new capacity qualification process) timeframes.
The new capacity qualification package (NCQP) is the next major submittal after the show-of-interest (SOI) application.
The NCQP is a set of data, forms, applicable supporting documents, and elections that collectively demonstrate the viability of a project.
For new generators, the NCQP consists of four major components:
Most project sponsors are expected to complete more than one section of the package depending on the resource type.
Intermittent generation resources seeking qualification need to provide additional information to support their claimed summer and winter qualified capacity as part of their NCQP.
This additional information should contain site-specific data, as well as all calculations deriving the claimed capacity using resource data, equipment energy conversion efficiencies, etc. This information will be used to confirm the claimed summer and winter qualified capacity.
Detailed data submittal guidelines for each type of intermittent resource are available on the FCM page.
The NCQP must be submitted in June four years before the beginning of the capacity commitment period. The submission window opens on the deadline for existing capacity qualification. For the specific window dates, learn how to access the auction calendars.
The NCQP must be submitted through the Forward Capacity Tracking System (FCTS). The ISO will not accept any submittal via email.
Screenshots with detailed instructions can be found in the “New Capacity Qualification Package” trainings available on the Training Materials webpage.
The project sponsor must complete each component of the NCQP as applicable. Once the documentation is submitted, the ISO may consult with the project sponsor to seek clarification, to gather additional necessary information, or to address questions or concerns that arise from the material submitted.
The information requested in the NCQP depends on your resource type. This information may include, but is not limited to, the following:
New capacity resources requesting to submit offers below the relevant ORTP must also submit with their NCQP sufficient documentation and information to permit the Internal Market Monitor to perform its review (details below). Recommended documents include, but are not limited to, the following:
Cost information is required for all new generating capacity resources seeking to participate in the FCA with the following project types:
Cost data associated with the project must be in sufficient detail to allow the ISO to determine that the relevant cost threshold will be met. Environmental compliance projects must include a detailed description of the specific regulations the project is seeking to comply with and the permits it must obtain.
The Internal Market Monitor (IMM) is responsible for ensuring the competitiveness of the FCM and other ISO New England markets through the following activities:
In the FCM, mitigation is performed by these actions:
ORTPs are the default values applied to capacity seeking to participate in the upcoming auction, which the IMM sets at the lower end of the competitive range for a particular technology type.
An ORTP is assigned to a new capacity resource during the show-of-interest process. During the FCA, the ISO removes the resource’s offered quantity of megawatts once the threshold price has been reached. However, a market participant has the option of requesting a lower offer floor price by submitting documentation indicating why the new capacity resource requires less compensation from the FCM than resources of a similar category. (Recommended documentation is noted above.)
The IMM will review market participant requests for an offer floor price below the ORTP and all associated documentation to determine if the requested value is a more accurate representation of the resource’s costs. The IMM may accept the requested lower value. However, if the IMM determines that the submission does not contain adequate information to support a price lower than the ORTP, the IMM will mitigate the offer up, capping the value at the ORTP. If the IMM determines that the requested value is not reflective of the resource’s true costs, the IMM will mitigate the offer to a price reflective of market conditions.
The qualification determination notification (QDN) of the resource provides the final offer floor price after IMM review and any mitigation, accessible in the FCTS along with an explanation for why the resource was mitigated, if applicable.
As part of the new resource qualification process, a new generating resource will be subject to the initial interconnection analyses to ensure that (1) the new generating resource does not cause overloads that cannot be fixed in time for the capacity commitment period and that (2) its capacity is deliverable within the load zone into which it will be interconnecting.
Existing resources seeking to qualify additional capacity will be studied at a capacity value above their current capacity network resource capability (CNRC).
Two reliability assessments are performed for this purpose as part of the new generating resource qualification process:
The initial interconnection analysis is performed following these rules:
The purpose of the analysis is to assess:
The assessment includes steady-state analysis, short-circuit analysis, thermal analysis, and other analyses depending on project type. Results from interconnection procedures for large and small generators and elective transmission upgrades (ETUs) are used whenever available.
This test helps the ISO ensure that the new generating resource under study does not cause overloads that cannot be fixed in time for the capacity commitment period. For example, in the diagram below:
The overlapping impact analysis helps the ISO determine if a proposed new capacity resource or an elective transmission upgrade provides incremental capacity to the system by doing the following to meet the CCIS:
The analysis is performed as a group study. All projects in the ISO’s Interconnection Request Queue seeking capacity network resource or import interconnection service are included on the basis of their queue position.
The generator redispatch criteria are as follows:
The transfer-level criteria are as follows:
General test conditions:
The overlapping impact analysis will reveal any qualification transmission upgrades (QTUs). These are transmission upgrades that the study resource will be responsible for addressing to make its capacity deliverable to the relevant load zone.
Reference Section 5.8.1 of Planning Procedure No. 10 for additional information on QTU identification.
Conditional qualification provisions apply when a resource may not qualify as a result of overlapping interconnection impacts with another resource. In these cases, Interconnection Request Queue order is used to choose between the overlapping generators.
Generator-based upgrades identified through these assessments will be listed in the qualification determination notification (QDN) of the resource, accessible in the Forward Capacity Tracking System (FCTS).
If a new resource clears in the FCA, the overlapping impact would be restudied, and the final list of upgrades would become part of the critical path schedule (CPS) for the project. The progress of these upgrades, along with all other CPS milestones, will be monitored.
Reference Section 5.8.3 of Planning Procedure No. 10 contains additional information on the methodology for restudying overlapping impacts.
No later than 150 days before the Forward Capacity Auction, project sponsors must inform the ISO of any changes to their projects that may reduce their capacity.
However, material modifications may not be made. If they are necessary, the project will be withdrawn.
Please contact ISO System Planning to discuss all potential changes.
See Market Rule 1, Section III.188.8.131.52.1, New Capacity Show-of-Interest Form.
To find out whether your resource is accepted for participation in the Forward Capacity Auction, check your qualification determination notification. Project sponsors can access these notifications through the Forward Capacity Tracking System (FCTS) no later than 127 days before the Forward Capacity Auction.
If your resource was not accepted, the notification will explain why.
If your resource was accepted, the notification will include the following information:
Project sponsors may elect to have the qualified capacity of their resource participate in primary auctions as a renewable technology resource (RTR). A designated amount of megawatts from RTRs are exempt from the minimum-offer floor price requirement in each capacity commitment period (CCP). The RTR election will be phased out with FCA #15 held in 2021. See RTR Phaseout below for details.
Note that renewable treatment elections will invalidate any prior election for a multiyear price lock-in for the resource.
To participate as an RTR, the resource must meet the following criteria:
The RTR election must be made through the Forward Capacity Tracking System under the New Qualification Elections tab. There, the project sponsor must submit the RTR election form and supporting documentation demonstrating that the resource meets each of the eligibility criteria noted above. The following information must be specified and documented:
For example, if the resource is participating in a specific state renewable or alternative energy program, the project sponsor must provide the name of the program, the web link for more information on that program, and detailed supporting documentation illustrating that the specific resource seeking qualification for RTR treatment has been accepted into that program and is (or will be) receiving revenue from the program. If the supporting documentation is applicable to multiple resources seeking RTR treatment, it must be uploaded for each resource separately, and the supporting documentation must clearly identify the resource by name, megawatts, or equivalent statements. Due to the tight timeframe for review, the ISO is unlikely to seek clarification on any documentation submitted. The election form is available in FCM Materials under FCM Forms and Guides.
The RTR exemption will be phased out with the implementation of the substitution auction. The FCA associated with CCP 2024–2025 (FCA #15) will be the final auction in which the RTR exemption is allowed, unless the remaining available megawatts clear in a primary auction before FCA #15.
Resources electing to participate in a primary auction as an RTR may also elect to participate in a substitution auction, provided that they meet all substitution auction supply eligibility criteria.
Pursuant to ISO New England Planning Procedure No. 10, new capacity resources that meet Attachment K certification criteria under the Open Access Transmission Tariff (OATT) are included in the FCA reliability assessments. Project sponsors that have contractual commitments under a state-sponsored request for proposal or similar financially binding contract, will complete and execute a certification of contractual commitment.
This certification is distinct from the renewable technology resource or sponsored policy resource (SPR) certifications and can be provided to the ISO voluntarily or by request at any time.
In certain instances, the ISO will automatically match an existing resource’s newly qualified additional megawatts with existing seasonal capacity at the same resource. Participants cannot opt out of automatic matching.
Automatic matching applies to these projects:
The amount of capacity eligible to be automatically matched will be limited to the excess existing megawatts in the offsetting season (summer or winter) at the same resource. Any remaining seasonal incremental capacity will need to form a composite offer to participate in the FCA.
The automatic matching process will occur before the opening of the composite offer window. (Learn how to access the auction calendars.)
An existing capacity resource submits a request to increase its capacity by 20 MW in the summer and 0 MW in the winter, and the increase is qualified as an incremental upgrade. The newly qualified summer megawatts are automatically matched to the excess existing winter capacity, and both the incremental capacity and the matched existing capacity are eligible for the multiyear price lock-in at the associated FCA clearing price.
An existing capacity resource submits a significant increase in capacity for 20 MW of summer capacity and 0 MW of winter capacity. Both the significant increase in capacity and the base resource are qualified as existing capacity. The qualified summer significant-increase megawatts are automatically matched to the excess existing winter capacity at the same resource.
An existing capacity resource submits an SOI to increase its capacity by 30 MW in the summer and 0 MW in the winter. The resource is qualified as an incremental upgrade and is eligible for the multiyear price lock-in. Only 20 MW of summer incremental increase are automatically matched to the excess existing winter capacity and eligible for the multiyear price lock-in at the associated FCA clearing price. A composite offer will need to be submitted for the resource to bring the excess remaining (10 MW) to the auction.
A composite offer allows capacity resources that have each received a qualified capacity value to participate together to maximize their combined offer in a Forward Capacity Auction.
Composite offers can be submitted during the composite offer window for the desired FCA. (Learn how to access the auction calendars.) Composite offers can be modified or withdrawn in the Forward Capacity Tracking System (FCTS) until the composite-offer deadline.
Throughout the composite offer submittal process, the FCTS will enforce various validation rules on partner eligibility:
Composite offers are submitted into the Forward Capacity Tracking System by selecting a specific new or existing resource. For new resources, select the New Qualification tab, then the Composite Offer tab:
For existing resources, select the Existing Qualification tab, then the Composite Offer tab:
The project sponsors for the summer and winter resources must then cooperate to complete the following steps by the deadline. Composite offers submitted after the deadline will not be considered in the FCA. Please note:
FCTS Actions Required by Each Partner
Initiate the composite offer in the FCTS. The Composite Offer Status will display as “Pending.” Ask your winter partner to act.
Designate the winter resource to the composite offer. Status remains “Pending.” Ask your summer partner to act.
Submit the composite offer. Status displays “Confirmed.” Ask your winter partner to act.
Verify submission: both participating resources should appear under Winter Resource Information (MW). If they don’t, contact Customer Support.
Only the summer resource partner in a composite offer should bid in an FCA. Both resources do not need to bid in individually.
Note that the peak-energy-rent mechanism is being eliminated. The capacity market payment adjustments associated with the PER mechanism will continue in place until June 1, 2019. After that date, the PER mechanism will no longer apply.
The Forward Capacity Auction Qualified Capacity (FCA QC) is the amount of megawatts, as determined in the qualification process, that a resource is capable of providing in the summer and winter during a specific capacity commitment period. Resources must pay financial assurance based on the FCA QC.
Your FCA QC is available in the Forward Capacity Tracking System (FCTS).
A market participant may choose to cover its FCM obligations by using resources it owns or has contracted with. The contract or agreement usually takes place outside of the ISO marketplace. Designating capacity from a resource as self-supply allows a load-serving entity (LSE) to satisfy its capacity load obligation using resources owned or under contractual obligation of the LSE.
For all resources—new or existing—the lead market participant must designate a resource as self‐supplied no later than the date new resources are required to post their financial assurance for the same capacity commitment period. (Learn how to access the auction calendars.)
All self-supply designations are done through the Forward Capacity Tracking System (FCTS). The designation window opens after the ISO posts Market Information Server (MIS) reports on each load-serving entity’s projected share of the Installed Capacity Requirement.
The steps to submit a self-supply designation, which must be completed by the self-supply submittal deadline, are as follows:
Throughout the designation process, the FCTS will enforce various validation rules on eligibility:
New capacity resources are responsible for posting financial assurance on their FCA qualified capacity.
Use the appropriate form available on the Financial Assurance and Credit page to set up financial assurance payments.
Check the due date in the auction calendars. (Learn how to access the auction calendars.)
A new capacity resource that has been qualified to participate in a Forward Capacity Auction (FCA) for a given capacity commitment period (CCP) may elect critical path schedule (CPS) monitoring. CPS monitoring ensures the following for the resource:
This CPS monitoring election is an annual election made by new capacity resources before the FCA. Check the due date in the auction calendars. (Learn how to access the auction calendars.)
Once made, this election is irrevocable. A change in the CPS milestones may result in a change in eligibility to participate in earlier CCPs’ reconfiguration auctions.
The election must be made through the Forward Capacity Tracking System (FCTS) under the New Qualification Elections tab during the CPS monitoring election window. As you make the election, you will be required to provide an update to the CPS submitted as part of the new capacity qualification package.
Forward Capacity Market participants should become familiar with the ISO’s market settlement and billing processes. See the FCM Settlements and Billing page for helpful resources.