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NERC and FERC on New England Reliability // Why Ørsted Quit New Jersey
Welcome to Grid Brief! Here’s what we’re looking at today: NERC and FERC raise reliability alarm for New England, Ørsted reveals why it left New Jersey, and more.
NERC and FERC on New England Reliability
In June, Everett Marine Terminal in New England announced that it may cease operations in 2024, as its main buyer, Mystic Generating Station, looks to shutdown in the spring. As part of the Federal Energy Regulatory Commission’s Reliability Week, FERC Chairman Willie Phillips and North American Electric Reliability Corp. CEO James Robb released a joint statement on what the loss of Everett could mean for New England.
Robb and Phillips pointed out that NERC and FERC’s joint investigation into the power system’s performance during Winter Storm Elliott last year revealed that the largest failures cascaded out of the natural gas system. Readers familiar with our “What’s Keeping the Lights On” series know that natural gas is a growing part of the power grid’s generation portfolio and vital to keeping New England alive.
“With respect to the natural gas system, the evidence raised what we view as serious concerns about certain local gas distribution systems’ ability to ensure reliability and affordability in the region without Everett,” write Phillips and Robb. “And, although there was evidence that the retirement of Everett would be ‘manageable’ for the electric system, at least in the near-term, given anticipated new resource deployments and transmission development, minimal load growth, limited resource retirements, and increased reliance on non-natural gas generators, the evidence indicates that, should those expectations not materialize as anticipated, ensuring reliability and affordability could become challenging in the face of a significant winter event.”
In other words, losing Everett is not insignificant to New England’s supply of reliable natural gas. Without that natural gas, the region’s electricity supply will be more vulnerable to winter storms.
Phillips and Robb advised ISO-New England to pursue reforms adequate to keeping infrastructure like Everett around in order to maintain reliability.
Why Ørsted Quit New Jersey
Last week, the Danish energy company Ørsted made headlines when it backed out of its offshore wind projects in the Garden State.
The decision came as a shock to the state and its governor, who called Ørsted’s decision “outrageous.” New Jersey had just passed legislation to let the offshore wind developers reap federal tax credits that were originally meant for consumers.
Offshore wind’s troubles have been persistent and thorny for over a year now. But Ørsted cited one major issue that drove it out of New Jersey: "Significant delays on vessel availability ... in the entire market has now meant that it would implicate a multi-year delay of the entire project,” said Ørsted CEO Mads Nipper, as reported by Reuters. The delays, according to Nipper, would put the company in "a situation where we would need to go out and recontract all or very large scopes of the project at expectedly higher prices."
To add insult to New Jersey’s injury, Ørsted is still pursuing its offshore wind projects in New York.
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