How it started
History
New England's electric power industry, like that of the entire nation, changed dramatically during the past few decades. Until the 1970s, the industry consisted of utilities that handled every aspect of providing electricity: generating it, transmitting it and then distributing it to homes and businesses. These utilities were regulated local monopolies that operated independently of each other.
The Northeast Blackout of 1965 marked a turning point for the region's electric power industry. It shut down power for 30 million customers. In January 1966, the Northeast Power Coordinating Council (NPCC) formed to improve system reliability. Concerned about the system's reliability, the Northeast's power companies formed three "power pools" to ensure a dependable supply of electricity. The New England Power Pool (NEPOOL), formed in 1971 by the region's private and municipal utilities, was intended to foster cooperation and coordination among utilities in the six-state region.
During the next three decades, NEPOOL created a regional power grid that now includes more than 300 separate generating plants and more than 8,000 miles of transmission lines.
While the electric power industry's regulated monopolies worked well for generations, by the 1990s the lack of competition provided little reason to improve service, minimize prices or invest in new facilities and technologies. In New England, electricity rates were among the nation's highest, and the region had an antiquated electric power infrastructure.
In the early 1990s, Congress and the Federal Energy Regulatory Commission (FERC)—which oversees the electricity industry nationally—began enabling the restructuring of wholesale electric power. They believed competition would provide needed renewal, much as it had in transportation, telecommunications and financial services.
From Wikipedia’s article on ISO New England, shared under CC BY-SA 4.0.2