On June 26, 2026, FERC accepted New York Independent System Operator, Inc.’s (NYISO) proposal to modify its Installed Capacity market rules to address seasonal reliability risks and to account for seasonal availability of capacity supply. In doing so, FERC found that the revisions will enhance NYISO’s ability to send appropriate price signals through the Installed Capacity market, which will ensure sufficient capacity during winter periods. The revisions were accepted effective June 28, 2026.
On February 18, 2026 (amended April 28, 2026), NYISO filed revisions to its Market Administration and Control Area Services Tariff (Tariff). As NYISO explained, although the installed capacity market has historically optimized resources around summer peaking demand, the regional transmission system has come under increasing strain from winter reliability events and has exposed certain system vulnerabilities, such as through the dependence on non-firm gas supplies to support electricity generation. To help address these concerns, NYISO proposed Tariff revisions to: (1) establish seasonal New York Control Area (NYCA) minimum capacity requirements, seasonal transmission security limit floor values, and seasonal Locational Minimum Installed Capacity Requirements; (2) require holders of Unforced Capacity Deliverability Rights (UDRs) and External-to-Rest of State Deliverability Rights (EDRs) to submit two distinct seasonal elections (Summer and Winter) for the upcoming Capability Year by August 1, accompanied by a must offer requirement and associated penalty; and (3) adjust the Installed Capacity Demand Curves to reflect the new seasonal minimum capacity requirements, including the creation of distinct zero crossing points for the summer and winter curves. NYISO’s Market Monitoring Unit supported the proposal. NYISO maintained that the proposal will help sustain resource adequacy while supporting efficient investment and resource retention to support winter reliability needs.
FERC found that the tariff revisions were just and reasonable and not unduly discriminatory or preferential. FERC agreed with NYISO that establishing separate summer and winter transmission security floor values will enable NYISO to develop Installed Capacity Demand Curves that more accurately reflect winter reliability risks. With respect to seasonal UDR/EDR election, FERC found that NYISO’s proposal reasonably addresses risk of potential misalignment between modeled and actual capacity. Specifically, FERC found that NYISO’s proposed seasonal elections will ensure more accurate data reflecting seasonal differences in availability of UDRs and EDRs. FERC also found that NYISO’s revisions to seasonal Installed Capacity Demand Curves reasonably accounts for seasonal differences in available capacity and reflect seasonal minimum capacity requirements in the seasonal Installed Capacity Demand Curves.
FERC’s order, issued in Docket No. ER26-1431 can be found here.
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