UNITED STATES OF AMERICA

BEFORE THE

FEDERAL ENERGY REGULATORY COMMISSION

SENECA POWER PARTNERS, L.P.)

)

Complainant,)

)

v.)Docket No. EL12-6-000

)

NEW YORK INDEPENDENT SYSTEM)

OPERATOR, INC.)

)

Respondent.)

NEW YORK INDEPENDENT SYSTEM OPERATOR, INC.’S
ANSWER TO COMMENTS AND

REQUEST FOR TECHNICAL CONFERENCE

Pursuant to Rule 213 of the Rules of Practice and Procedure of the Federal Energy

Regulatory Commission (“FERC” or “Commission”),1 the New York Independent System

Operator, Inc. (“NYISO”) hereby submits this answer to (i) the Comments in Support and

Request for Technical Conference or Other Commission Assistance of TC Ravenswood, LLC;2
and (ii) the Motion to Intervene and Comments in Support of Independent Power Producers of
New York, Inc.3 The comments of TC Ravenswood, LLC (“TC Ravenswood”) and the
Independent Power Producers of New York, Inc. (“IPPNY”) are not germane because they do
not provide cost or other information relevant to the calculation of reference levels for the

Because these pleadings are “comments,” the NYISO is entitled to answer them under

Commission Rule 213(a)(3). In addition, the NYISO is entitled to respond to the TC

Ravenswood pleading, since it seeks affirmative relief in the form of a technical conference, and thus is in effect a motion.

Seneca Power Partners, L.P. (“Seneca”) Batavia Generator (“Batavia”), which is the only issue raised by Seneca’s complaint (“Seneca Complaint”). In addition, the Commission should deny TC Ravenswood’s request for a technical conference, because: (1) the issues posed by TC Ravenswood for consideration at a technical conference are not placed at issue by the Seneca Complaint; and (2) the determination of the three elements of the Batavia reference levels that are at issue under the complaint turns on confidential, unit-specific cost information that could not meaningfully be assessed in a multi-party technical conference involving the owners or bidders of other Generators that participate in the New York markets.4

I. ANSWER

A.The Commission Should Disregard TC Ravenswood’s and IPPNY’s Comments As

They Do Not Provide Information Relevant to the Calculation of Batavia’s

Reference Levels

Because they cannot possibly know the unit-specific costs or operating characteristics of
Batavia, TC Ravenswood’s and IPPNY’s comments simply assume that the assertions in the
Seneca Complaint are all factually correct and fully substantiated. Thus, to the limited extent
that the IPPNY and TC Ravenswood comments purport to address the issues raised in the
complaint, the reasoning of the comments is at best redundant and that only if the facts alleged in
the Seneca Complaint are 100% true and accurate. The November 28, 2011 Answer of the New
York Independent System Operator, Inc. (“Answer”) shows that this is not the case.
Third-party Generators are not in a position to contribute to the resolution of the Seneca Complaint. The NYISO calculates Batavia’s reference levels by determining Batavia’s marginal

costs through a detailed assessment of confidential, Generator-specific data in accordance with
the requirements in the Market Power Mitigation Measures set forth in Attachment H to the
NYISO’s Market Administration and Control Area Services Tariff (“Mitigation Measures”).5
The NYISO and Seneca can address concerns regarding Batavia’s reference levels through
consultations pursuant to the process set forth in the Mitigation Measures.6 TC Ravenswood and

IPPNY do not have access to Batavia’s confidential reference levels or to the confidential,

Generator-specific data used by the NYISO to calculate the Batavia reference levels. TC

Ravenswood and IPPNY do not and, as potentially competing Generators, should not, participate
in the consultations between the NYISO and Seneca regarding Batavia’s reference levels.
In the absence of any facts, the TC Ravenswood and IPPNY comments merely parrot back Seneca’s arguments from its complaint and make unsupported, conclusory statements that Seneca has demonstrated that the NYISO has not calculated Batavia’s reference levels in
accordance with the Mitigation Measures.7 IPPNY and TC Ravenswood’s comments do not and
cannot contribute in any meaningful way to the Commission’s resolution of the fact-based, unit-
specific reference level determinations placed in issue by the Seneca Complaint.
TC Ravenswood, citing an order in a proceeding that did not involve the determination of reference levels, claims that “the NYISO continues to make overly exclusionary decisions with respect to variable costs in reference prices by excluding natural gas commodity basis
adjustments, local transportation rates and gas balancing costs.”8 As shown in the NYISO’s

5 SeeNew York Independent System Operator, Inc. November 28, 2011Answerat 12-

19 (“NYISO Answer”).

6 See NYISO Answer at 20-22.

7 See, e.g.,TC Ravenswood Comments at 6; IPPNY Comments at 7.

8 TC Ravenswood Comments at 9.

-3-

Answer, however, the problem with Seneca’s gas costs claims is not some nuance in the

definition of “variable” costs, but rather Seneca’s failure to come forward with any data on the variable costs of local gas transportation service to Batavia.9

The Commission should similarly disregard TC Ravenswood’s and IPPNY’s scattered
attacks on the NYISO’s process for setting and reviewing a Generator’s reference levels.10 The
NYISO sets and reviews each Generator’s reference levels in accordance with the process and
timetable accepted by the Commission and set forth in the Mitigation Measures. TC
Ravenswood’s and IPPNY’s complaints regarding the NYISO’s process are simply a collateral
attack on the Commission’s approval of this process in other dockets, and are not relevant to the
calculation of the three specific elements of Batavia’s reference levels at issue in this proceeding.
Finally, the Commission should disregard TC Ravenswood’s assertions regarding the reference levels of TC Ravenswood’s Generators. Such complaints are beyond the limited scope of this proceeding. While initially indicating that it may have to seek Commission action to
resolve its own issues,11 TC Ravenswood then proceeds to detail its concerns regarding the
calculation of the reference levels of its own Generators and requests broad Commission action
to address these claims.12 The calculation of the reference levels for TC Ravenswood’s
Generators are not at issue in this proceeding. Rather, the Seneca Complaint solely concerns the
calculation of the reference levels for local gas transportation cost, minimum run time, and
operating and maintenance costs for Batavia.

9 NYISO Answer at 6-7, 24-25.

10 See, e.g., TC Ravenswood Comments at 6; IPPNY Comments at 8.

TC Ravenswood Comments at 2.

12 See TC Ravenswood Comments at 8-11.

-4-

TC Ravenswood’s comments are, essentially, a new complaint against the NYISO
regarding the calculation of the reference levels for TC Ravenswood’s Generators. The
Commission has previously denied intervenors’ attempts to initiate a new complaint through another party’s proceeding and should, therefore, reject any attempt to expand the scope of this docket beyond a determination regarding the three elements of Batavia’s reference levels raised in the Seneca Complaint and addressed in the NYISO’s Answer.13

B. The Commission Should Deny TC Ravenswood’s Request for a Technical

Conference As the Request Goes Beyond the Complaint and a Technical Conference Is Not a Suitable Forum for Addressing Generator-Specific Determinations

TC Ravenswood asks the Commission to “convene a technical conference or other

Staff/ALJ administered proceeding to define certain standard definitions to be used in reference
price calculations.”14 TC Ravenswood proposes that the technical conference should cover the
setting of “certain generic and recurring cost items and types.”15 The Commission should deny

TC Ravenswood’s request.

First, the Seneca Complaint does not request relief based on the resolution of conflicting
definitions of “generic and recurring cost items and types.” Rather, the complaint turns on
whether Seneca has in fact “shown that it has a cost foundation for each NYISO-proposed

See, e.g., Golden Spread Elec. Coop., Inc., 115 FERC ¶ 61,136, at P 4 (2006) (“[T]he

Commission has long held that a complaint cannot be submitted as part of a motion to

intervene.”); see also, Louisiana Power & Light Co., 50 FERC ¶ 61,040 at 61,062-63(1990)
(stating that complaints must be titled as such and cannot be included as part of a protest or
motion to intervene); Yankee Atomic Elec. Co., 60 FERC ¶ 61,316 at 62,096-97 n.19 (1992)
(explaining importance of filing complaint separately from motion for clarification); Entergy
Servs., Inc., 52 FERC ¶ 61,317 at 62,270 (1990) (stating that complaints must be filed separately from motions to intervene and protests).

TC Ravenswood Comments at 8.

TC Ravenswood Comments at 2.

-5-

change to the reference price.”16 TC Ravenswood may wish to dispute other issues, but those

issues are not relevant to the complaint now before the Commission.

Second, as described in its Answer, the NYISO calculates each Generator’s reference levels by determining that Generator’s marginal costs through a detailed assessment of the
Generator’s unique, confidential data pursuant to the process set forth in the Mitigation
Measures.17 A technical conference addressing multiple Generators’ reference levels is not a suitable forum for this determination, as it is specific to each Generator and based on an
independent evaluation of that Generator’s confidential costs and operating data and other
proprietary, unit-specific information.

TC Ravenswood’s request for a technical conference is another effort to inject its own issues into another Generator's proceeding. If TC Ravenswood has a concern regarding its
Generators’ reference levels, it should be required to follow the consultation process set forth in the Mitigation Measures. If TC Ravenswood does not agree with the NYISO’s determination regarding its reference levels through this process, it should seek assistance from the NYISO’s independent Market Monitoring Unit or the Commission to address its specific claims, rather than seeking to inject extraneous issues into this docket.

II. CONCLUSION

WHEREFORE, for the reasons set forth above, the NYISO respectfully requests that the Commission disregard TC Ravenswood’s and IPPNY’s comments in making its determination and deny TC Ravenswood’s request for a technical conference.

Seneca Complaint at 36.

17 See NYISO Answer at 12-19.

-6-

Respectfully submitted,

/s/ William F. Young

William F. Young

Michael J. Messonnier

HUNTON & WILLIAMS LLP

2200 Pennsylvania Ave., N.W. Washington, D.C. 20037
202 • 955 • 1500

202 • 778 • 2201 Fax

Attorneys for New York Independent System Operator, Inc.

Dated: December 13, 2011

-7-

CERTIFICATE OF SERVICE

I hereby certify that I have this day served the foregoing document upon each person

designated on the official service list compiled by the Secretary in these proceedings in

accordance with the requirements of Rule 2010 of the Rules of Practice and Procedure, 18 C.F.R. § 385.2010.

Dated at Washington, D.C. this 13th day of December, 2011.

/s/ William F. Young

William F. Young

HUNTON & WILLIAMS LLP

2200 Pennsylvania Ave., N.W. Washington, D.C. 20037
202 • 955 • 1500

202 • 778 • 2201 Fax

55430.000122 EMF_US 38126433v5