Electricity prices increased in New England in 2018
Electricity prices in New England rose in 2018 over 2017 prices, according to ISO New England.
However, ISO New England points out that the prices were the six-lowest since the current wholesale markets were implemented 16 years ago. The total value of New England’s wholesale electric energy market in 2018 was $6 billion, up 34 percent from 2017 but down 19 percent from 2004.
Wholesale prices rose last year for several factors. One, the cost of natural gas to produce electricity was higher; two, consumer demand increased; and three, an extreme cold spell during the first week of the year raised prices during that period.
The preliminary average annual price for wholesale power in New England last year was $43.54 per megawatt-hour (MWh), a 28 percent increase over 2017. The average price of natural gas in 2018 in New England was $4.84 per million British thermal units (MMBtu), up 30 percent from 2017. Natural gas-fired plants generated 49 percent of the electricity produced in New England.
Consumer demand for electricity rose by 1.8 percent in 2018 to about 123,344 gigawatt-hours. Consumer demand is influenced by several factors, including the economy, weather, and the effects of energy-efficiency measures.
Wholesale electricity prices rise and fall based primarily on fuel prices, demand for power, and transmission system conditions.
ISO New England an independent, not-for-profit corporation responsible for the operation of New England’s electric power generation and transmission system.
