ISO New England has released the "New England Electricity Scenario Analysis," a report that examines the reliability, economic, and environmental impacts of pursuing a range of resource scenarios for the region to meet future electricity needs. The purpose of the report is to serve as a reference document for policymakers and the industry to use when considering fulfilling the region's energy requirements.

"New England electricity consumers want reliable, clean power and they want it at reasonable and competitive prices," said Gordon van Welie, president and chief executive officer of ISO New England Inc. "This analysis is intended to provide valuable information for regional policymakers and other stakeholders to use as they pursue these goals."

The New England Electric Scenario Analysis is intended to help regional policymakers better understand the drivers for electricity costs, fuel diversity issues, and environmental impacts; clarify some of the trade-offs among these drivers; and inform the public, regional policymakers, and other decision makers about the impacts of various solutions to the region's challenges.

Over the past eight months, interested stakeholders along with the ISO evaluated seven basic scenarios involving different mixes of supply- and demand-side resource scenarios. The report uses specific assumptions developed by the stakeholder group about various technology outcomes that represent only a one-year 'snapshot' in time, serving as a point of reference. Based on this specific set of assumptions, some of the key themes of the Scenario Analysis include:

-- New England likely will continue to depend heavily on natural-gas-fired electricity production.

-- Fossil fuel prices drive the region's energy mix, electricity prices, and emissions; the relative costs of natural gas and oil strongly influence electric energy prices and air emissions.

-- New England likely will face significant challenges in meeting its allocation of Regional Greenhouse Gas Initiative allowances.

-- Lower systemwide wholesale electric energy prices and reduced air emissions seem possible by reducing demand or supplying large amounts of electric energy from low-cost fuel sources and those fuels that emit few pollutants.

-- Demand-side resources appear to provide capacity and energy to the system at relatively low capital costs and with low emissions relative to other resources.

The report also stated that the region will likely need continued transmission improvements. This is especially true if the region adds renewable power resources in areas far from major cities, or imports more hydroelectric power from Canada. In addition, adding infrastructure in the regional natural gas supply and delivery systems and lessening gas-sector demands could mitigate price volatility during periods of high demand.

"The purpose of this initiative is to inform policymakers, so they can make judgments regarding available outcomes," van Welie said. "The ISO is eager to continue to work with policymakers and stakeholders to define the next stage of this analysis."

The analysis envisioned a peak system demand of about 35,000 MW by 2020 to 2025 and examined the addition of 8000 MW. Each of seven scenarios assumed that 2600 MW would reflect the mix of recently proposed power sources, mostly natural gas power plants. The remaining 5400 MW represented a large concentration of a certain technology, such as nuclear, new coal, natural gas, imports, demand-side resources, or renewables, to assess their impacts.

More than 100 representatives from ISO New England, the New England Conference of Public Utilities Commissioners, the New England Power Pool, consumers, utilities, state regulators, and environmental experts were involved in the groundbreaking analysis.