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Locational Avoided Capacity and Transmission Cost Across US ISOs

In 2025, the capacity-plus-transmission cost a consumer avoids by cutting one kilowatt of demand at the coincident peak ranged from about $33 to $293 per kW-year across US ISO zones (median about $154), highest in PJM (PSEG $293, DOM $254). Each figure is for a specific zone and year; 2025 is elevated by recent capacity-price spikes.

The consumer-side avoided cost: what a consumer (or the load-serving entity on their behalf) avoids in capacity and transmission cost by reducing one kilowatt of metered demand at the coincident peak, by ISO zone and year (2018-2027). The locational value signal for grid flexibility, VPP, and siting decisions.

Coverage: All 7 US ISOs (CAISO, ERCOT, ISO-NE, MISO, NYISO, PJM, SPP), 2018-2027, by zoneLicense: CC BY 4.0Updated: 2026-06-19

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Free to use with attribution (CC BY 4.0). These are the derived summary tables, reproducible from the primary sources.

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How it is built

This is the consumer-side (load) avoided cost: the bulk-system capacity and transmission cost avoided when a retail-metered kilowatt is removed at the coincident peak, grossed up from the meter to the system by transmission and distribution loss factors. Avoided capacity cost uses the zone's capacity price; avoided transmission cost uses the zone's peak-driven transmission rate. Capacity values are market-cleared for PJM, ISO-NE, MISO, and NYISO (auction prices); CAISO uses a regulator-published bilateral RA proxy (CPUC); SPP uses the SPP market monitor's new-entry net-revenue-gap proxy (about $61/kW-yr in 2025), a public economic-value estimate (no cleared or bilateral SPP capacity price exists; the OATT CONE of $85.61/kW-yr and its $107 to $171/kW-yr deficiency range are the administrative benchmark). ERCOT is energy-only, so its total is transmission-only. These are different kinds of number and are not directly comparable. The figure is the value a flexible consumer creates; whether the consumer captures it depends on rate design (a coincident-peak demand charge passes it through, flat volumetric rates do not). The same avoided cost reads differently to a utility (avoided procurement plus deferred transmission, net of lost throughput), a system operator (resource adequacy and reliability), and a regulator (total-resource-cost cost-effectiveness). Method follows the CPUC Avoided Cost Calculator and NYSERDA VDER frameworks.

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Cite this dataset

Corey Balgeman, "Locational Avoided Capacity and Transmission Cost Across US ISOs," Grid Flexibility, 2026. https://gridflexibility.fyi/data/locational-avoided-cost

Part of the Grid Flexibility open datasets. Provenance and methodology are published; another researcher can reproduce these tables from the primary sources. Canonical home: https://gridflexibility.fyi/data/locational-avoided-cost.