Monday, February 18, 2019

FERC Approves New Hampshire Capacity Settlement

By Michael Kuser

A 4.5-MW biomass power generator in Claremont, N.H., will refund ISO-NE capacity payments it wrongly accepted for nine months following the plant’s closure in September 2013 and pay a $250,000 civil penalty under a settlement approved by FERC on Friday (IN18-10).

The commission accepted a stipulation and consent agreement between its Office of Enforcement and Wheelabrator Technologies under which the company will disgorge $107,231.34 in capacity payments and interest.

Claremont energy-from-waste facility | Stuart B. Millner & Associates (SBMA)

Enforcement began its investigation in March 2015 following a referral from the RTO. “Claremont subsequently responded to data requests and requests for investigative testimony, and demonstrated cooperation during the investigation,” the commission said.

Following the Claremont facility’s closure, ISO-NE continued to issue monthly capacity payments for a year in exchange for Claremont’s continuing obligation to supply capacity while the facility was inoperable. The RTO later clawed back the July to October 2014 payments through its Tariff-based reconciliation process.

Public Service New Hampshire (now part of Eversource Energy) previously purchased Claremont’s generation and operated as its lead market participant and asset owner, managing Claremont’s participation in the Forward Capacity Auctions (FCAs) and receiving the payments issued by ISO-NE. On Dec. 1, 2013, PSNH transferred Claremont’s market participant status to Wheelabrator North Andover, which operates a generation facility in North Andover, Mass., and, as of that date, began receiving capacity payments on Claremont’s behalf.

At the time, Wheelabrator management did not fully understand its obligation to shed its capacity supply obligations for FCA 4 (June 2013 to May 2014) and FCA 5 (June 2014 to May 2015) and continued to collect capacity payments for the closed Claremont facility, the commission said.

“Accordingly, Claremont did not successfully shed those obligations. Claremont did shed its obligation for FCA 9 through a non-price retirement request. Claremont’s obligations in FCA 8 were eventually unwound by ISO-NE after it discovered Claremont’s permanent closure,” the commission said.

Wheelabrator’s compliance measures were insufficient to identify the violation, the commission said. The company also agreed to submit annual reports for two years on the progress of its recently implemented compliance measures and any new incidents of noncompliance.