This analysis is an addendum to the July 2021 assessment of energy storage as a cost-effective alternative to building Project 2015A, also known as the Peabody Peaker, a 60 megawatt oil and gas peaking unit proposed by the Massachusetts Municipal Wholesale Electric Company (MMWEC) to serve 14 municipal light plants (MLPs) and provide capacity into the ISO-NE market. Both analyses were prepared by Strategen for Clean Energy Group. This analysis focuses on the purchase of capacity from the market and concludes that the light boards could collectively fulfill their capacity obligations by buying capacity from the market at a lower cost than participating in Project 2015A.
Strategen compared the cost of $84.3 million to construct Project 2015A to the cost of buying from the market. The cost savings in the first 15 years combined with significant uncertainty in later years and environmental harm and emissions issues that jeopardize the likelihood of the proposed project operating its full life without an expensive retrofit lead Strategen to conclude that the participating MLPs stand to benefit from withdrawing from the project and purchasing capacity from the market.
- Press Release: New reports outline the financial risks associated with investing in the proposed Peabody Peaker plant, and indicate purchasing energy on the open capacity market is forecasted to be cheaper than the $85 million plant (3/10/2022)
- Policy Brief: Peabody Peaker Plant Risk Assessment (Applied Economics Clinic, March 2022)