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Latest New England capacity auction clears 12.6% lower on year at $4.63/kW-month

The clearing price in the 12th annual ISO New England forward capacity auction came in within the range of market estimates, clearing after four rounds at $4.63/kW-month, down 67 cents, or 12.6%, on the year.

Preliminary results of the New England forward capacity auction, which began Feb. 5 and covers the capacity commitment period of June 1, 2021, to May 31, 2022, were issued Feb. 7.

After five rounds, Phase I/II HQ Excess and New Brunswick closed at clearing prices of $3.70/kW-month and $3.16/kW-month, respectively.

A total of 34,827 MW of capacity cleared in the auction.

In February 2017, the regional transmission organization's 11th forward capacity auction which covered the capacity commitment period of June 1, 2020, through May 31, 2021, cleared $1.73, or 24.6% lower, on the year at $5.30/kW-month. A total of about 35,835 MW cleared in the 11th forward capacity auction.

Market analysts had expected the latest auction would clear at a price below the prior year's level. The range of projections spanned $4.30/kW-month to $5.30/kW-month due to increased demand response, a decline in the Net Installed Capacity Requirements and a lower cost of new entry.

On Feb. 8, ISO New England will issue a formal news release regarding additional details of the auction results.