Forecasted Demand for Electricity in NYC Shows ‘Reliability Supply Deficit’ by 2025, NYISO Reports

By JOHN JORDAN – July 21, 2023

RENSSELAER, NY—As New York State continues its push for green and renewable energy sources, The New York Independent System Operator (NYISO) on July 14 released its quarterly assessment of reliability of the bulk electric system, which found a deficit in reliability margins for the New York City area beginning in summer 2025.

The deficit is as large as 446 MW (the equivalent of nearly half the power that the now-shuttered Indian Point Nuclear Power Plant Unit 3 produced [1,040MW] during peak demand periods). The power deficit is driven primarily by the combination of a forecasted increase in peak demand and the unavailability of certain generators, the ISO stated.

Before the closure of Indian Point Energy Center in Buchanan, NY, the two nuclear reactors supplied approximately 2,000 MWs of electric power, or almost 25% of New York City’s usage.

The NYISO’s Short-Term Assessment of Reliability (STAR) studied electric system reliability for the period April 15, 2023, through April 15, 2028. Factors driving New York City’s reliability need in 2025 include increased electrification of the transportation and building sectors, continued economic growth following the pandemic, and the unavailability or retirement of select “Peaker” generators under the New York State Department of Environmental Conservation’s emissions limits. That rule went into effect in May 2023. 

The ISO report noted that the agency may need to keep some fossil fuel “Peaker” energy facilities open to meet New York City’s power needs in 2025.

“This new STAR report reflects the extraordinary challenges of the grid in transition,” said Zach Smith, NYISO’s vice president of System and Resource Planning. “The reliability of the electric system is essential to the health and safety for all New Yorkers as well as the state’s economy. The NYISO will now work to identify solutions to the reliability need identified in New York City.”

The ISO assessment found a reliability need beginning in the summer of 2025 in New York City primarily driven by a combination of forecasted increases in peak demand and the assumed unavailability of certain generation in New York City affected by the “Peaker Rule.”

“Specifically, the New York City zone is deficient by as much as 446 MW for a duration of nine hours on the peak day during expected weather conditions (95 degrees Fahrenheit) when accounting for forecasted economic growth and policy driven increases in demand,” the report stated. “The deficiency would be significantly greater if New York City experiences a heat wave (98 degrees Fahrenheit) or an extreme heatwave (102 degrees Fahrenheit).”

Beyond 2025, the STAR report found that New York City’s reliability margin would improve when the Champlain Hudson Power Express (CHPE) transmission line from Quebec to New York City is completed. CHPE is expected to enter service in the spring of 2026. The STAR report found that delays in CHPE’s schedule could result in additional transmission security concerns. The NYISO will continue to monitor closely the development of CHPE.

The reliability need is based on a deficiency in transmission security. Transmission security analysis tests the ability of the power system to withstand disturbances, such as electric short circuits or unanticipated loss of a generator or a transmission line, while continuing to supply and deliver electricity. The NYISO first identified rapidly declining reliability margins in its 2021 Comprehensive Reliability Plan and restated those concerns in its 2022 Reliability Needs Assessment. 

Reliability rules that determine the acceptable levels of transmission security are determined by several entities that are responsible for overseeing the reliability of the bulk electric system, including the North American Electric Reliability Corporation, the Northeast Power Coordinating Council, the New York State Reliability Council and the New York State Public Service Commission. 

Three natural gas-fired power plants have been introduced over the past three years to help support the electric supply needed by New York City that Indian Point had been providing: Bayonne Energy Center II (120 MW), CPV Valley Energy Center (678 MW), and Cricket Valley Energy Center (1,020 MW).

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