New Hampshire’s coal-fired power plant, the last of its kind in New England not set to retire, will now remain online through at least 2025, despite calls from climate change activists for it to close.
The news comes from a federal filing in late February by the regional grid manager, ISO-New England.
The nonprofit filed results from its latest forward capacity auction, where power plants bid on payments in exchange for promising to generate electricity three years in the future.
“This is our reliability market – it’s the commitment to be there to ensure there’s sufficient supply to meet consumer demand,” said Dan Dolan, president of the New England Power Generators Association, in a recent interview. He said these auctions often give insight into changes to come. “It’s the first indication of plants retiring and it also gives this three-year runway for new facilities,” he said.
Merrimack Station, the coal plant in Bow, is already committed to providing its more than 400 megawatts of capacity to the grid in each of the next two years. In this latest auction, it extended that through mid-2025.
The facility will be the last coal user in the region after Bridgeport Harbor Station, a similarly sized plant in Connecticut, retires this June. The PSEG-owned facility was replaced by a new natural gas plant in 2019.
Merrimack Station’s owner is Bow-based Granite Shore Power, which also owns a smaller fossil fuel plant in Portsmouth. The 90-megawatt Schiller Station hasn’t run its coal or oil units recently, and laid off workers last summer when it idled its wood-fired biomass unit.
Like Merrimack Station, Schiller also has a quick-start jet turbine that runs on kerosene and is typically called up in grid emergencies. Both plants won commitments from the latest ISO auction to keep their jet turbines available in 2024-25.
New England currently gets about 1 percent of its electricity from coal each year – down from nearly a fifth of the fuel mix 20 years ago. The region now gets the majority of its power from natural gas and has been using more renewable energy than coal every year since 2011, according to ISO data.
In addition to power plants, the capacity market also includes what are known as “demand” resources – such as energy efficiency and battery storage, which ISO officials say saw a notable uptick in this year’s auction.
Dolan, with the Power Generators Association, said stakeholders and regulators are now considering whether these “fuel-agnostic” auctions should be changed to include a carbon price or “environmental performance” measure as a third priority alongside reliability and low prices.
He argues this would be a fair way to encourage clean energy development and constrain planet-warming emissions in line with state climate change goals.
Activist groups like 350 New Hampshire and the No Coal No Gas campaign have also argued that ISO's current capacity auctions do too much to encourage fossil fuel plants like Merrimack Station to stay open.
"ISO-NE’s reliance on coal and other fossil fuels for electricity decreases reliability by driving climate change, which leads to more frequent extreme weather events, the primary cause of power outages," said No Coal No Gas in a statement. "It is irresponsible, dangerous, and poor grid-management to prop up fossil fuel generators that cannot compete with other generators or generate electricity without contributing to climate change."
They suggest that ISO maintains too high a reliability margin -- reserving more extra fuel than almost any other grid manager in the country -- and that this margin could be lowered to encourage fossil fuel retirements and funnel savings to more climate-friendly energy projects.
The debate comes at a time when reliability is in the national spotlight after a historic winter storm led to rolling blackouts in Texas, which is not interconnected with the rest of the country's electric system and operates with no reserve margin, allowing instead for greater short-term price spikes.
CORRECTION: An earlier version of this story incorrectly stated that Granite Shore Power is headquartered in Connecticut. In fact, it's based in New Hampshire. This story has been updated to reflect that and to include a statement from the No Coal No Gas campaign.