The Northeast power grid is entering a period of rapid transformation as electrification drives load growth during winter months, while the retirement of dispatchable resources due to age, economics, and policy goals tightens operating reserves. Meeting this growing demand while maintaining reliability and affordability presents a material challenge for regulators and system planners across the region.
In this white paper, the authors assess the contribution of offshore wind (OSW) to system reliability and affordability in ISO New England (ISO-NE) and the New York Independent System Operator (NYISO). Using detailed capacity expansion, production cost, and probabilistic reliability modeling, the analysis evaluates how OSW performs relative to alternative portfolios dominated by onshore renewables or natural gas. The findings indicate that OSW can provide meaningful resource adequacy and energy price benefits, offering complementary performance to other generation resources. The authors also find that new resources, particularly those capable of delivering energy during winter and nighttime stress periods, will be needed in downstate regions of NYISO to meet growing load and hedge against tightening reserve margins across the American and Canadian Northeast.
Simultaneously, the authors recognize that OSW development faces challenges, including cost pressures, supply-chain constraints, permitting uncertainty, and declining effective load carrying capability (ELCC) values as additional capacity is added. Some of these challenges are not unique to OSW. For example, natural gas additions are constrained by pipeline capacity and permitting timelines; solar and onshore wind require extensive land use and transmission expansion; and storage resources depend on sufficient energy availability during multi-day stress events.
The authors note that the extent of OSW’s reliability and affordability benefits depends on several additional factors, most critically – the price of power purchase agreements (PPAs), permitting uncertainty, and transmission costs associated with OSW. They also emphasize that decisions to add new resources must balance cost, development risk, and policy objectives alongside reliability considerations when selecting a portfolio mix.
Read more about the impacts of offshore wind on reliability and affordability in ISO-NE and NYISO here.
