Below, Price Map for projected Day Ahead system from ISO-NE website
By GARRY RAYNO, InDepthNH.org
CONCORD — A change the region’s electric system’s manager made a year ago, has added about $1 billion to New England customers’ bills.
The change went from a fixed-rate, six-month bid contract to a day-ahead auction system with flexible pricing and resources.
Tuesday Gov. Kelly Ayotte called on Independent System Operator (ISO) New England to quickly reform the Day-Ahead Ancillary Services market so electric prices will go down.
The region’s Internal Market Monitor’s data indicates the Day-Ahead Ancillary Services (DA A/S) program cost an additional $921 million across New England since March 2025, significantly higher than the ISO’s original estimate of $140 million.
Ayotte met with ISO-NE president and CEO Dr. Vamsi Chadalavada last week and discussed the DA A/S structure and its shortcomings, she said in a letter to the ISO-NE board and urged the organization to act on the fixes proposed by the Internal Market Monitor as quickly as possible to bring down electric rates for all of New England.
“The IMM (Internal Market Monitor) is clear that changes in market fundamentals alone do not account for the full magnitude of the overrun,” Ayotte wrote. “January 2026 results further illustrate the severity of these outcomes under stressed winter conditions.”
The unprecedented cost increases impose substantial and unanticipated burdens on electricity consumers across New England, including in New Hampshire, and should receive urgent attention to protect ratepayers, she said in her letter.
“Electric bills are through the roof, and New Hampshire families and businesses shouldn’t bear these unnecessary additional costs,” said Ayotte in a press release. “New England’s electric system needs to be reliable and affordable, and it must be reformed immediately to lower costs for Granite Staters.”
Under the old six-month contract system ancillary services were far less than than the 9 percent of power costs on a customer’s bill from the day-ahead auction system. The ISO estimated the change to the new system would be about 3 percent of a bill’s energy costs.
Ancillary services help maintain grid stability and reliable delivery. They include such things as regulation, operating reserves, and voltage support.
Ancillary costs are their own independent market, much like the separate energy and forward capacity markets.
The change was made to reduce the “fast start generation” costs when more energy is needed quickly and to lower real time market expenses.
However critics of the new plan say it has resulted in charges that are higher and less predictable.
“New Hampshire’s consumers should not be expected to shoulder unnecessary costs,” Ayotte wrote in her letter. “New England’s electricity system must remain both reliable and affordable, and in its current form, DAA/S is falling short of that responsibility and must be reformed to better serve the people of our state. I appreciate your attention to this important matter.”
Ayotte recently nominated and the Executive Council confirmed Chris Ellms as the new Chair of the Public Utilities Commission, although he has little experience in the electric industry.
Ayotte said the top priority for the commission has to be affordability.
In her state-of-the-state speech last month, Ayotte directed the Department of Energy to work with legislators, experts, and stakeholders to pave the pathway for next-generation nuclear power in New Hampshire.
New England and New Hampshire have some of the highest electric rates in the country and they can be expected to go higher with the region’s high dependence on natural gas to generate electricity.
The Iran War and the resulting blockage of the Strait of Hormuz have halted the delivery of oil and natural gas to nations around the world driving up prices for fossil fuels.
Garry Rayno may be reached at garry.rayno@yahoo.com.