UNITED STATES OF AMERICA
BEFORE THE

FEDERAL ENERGY REGULATORY COMMISSION

New York Independent System Operator, Inc.)Docket No. ER12-1155-000

MOTION TO INTERVENE AND COMMENTS IN SUPPORT BY
THE NEW YORK INDEPENDENT SYSTEM OPERATOR, INC.

Pursuant to Rules 212 and 214 of the Federal Energy Regulatory Commission’s

(“Commission”) Rules of Practice and Procedure, 18 C.F.R. §§ 385.212, 385.214 (2011), the
New York Independent System Operator, Inc. (“NYISO”) moves to intervene and comment in
support of the February 24, 2012 tariff filing by ISO New England (“ISO-NE”) and the New
England Power Pool (“NEPOOL”) (together the “Filing Parties”) in the above-captioned
proceeding.1 As discussed below, the Filing Parties have proposed to amend the ISO-NE
Transmission, Markets and Services Tariff by adding a set of market rules known as Coordinated
Transaction Scheduling (“CTS”). CTS is designed to enhance the efficiency of energy trading
over ISO-NE’s external border with New York and, once in place, is expected to significantly
lower the cost of energy for market participants in both the ISO-NE and the NYISO regions.
The NYISO supports this filing and urges the Commission to approve it.

ISO New England Inc. and New England Power Pool, Market Rule 1 Revisions Related to Coordinated

I.COMMUNICATIONS

All communications, pleadings, and orders with respect to this proceeding should be to:

Robert E. Fernandez, General Counsel

Ray Stalter, Director, Regulatory Affairs
*Mollie Lampi, Assistant General Counsel
New York Independent System Operator, Inc.

10 Krey Boulevard

Rensselaer, NY 12144
Tel: (518) 356-8875
Fax: (518) 356-7678

rfernandez@nyiso.com
rstalter@nyiso.com
mlampi@nyiso.com

* Designated to receive service.

II.COMMENTS

The Filing Parties propose to implement CTS to improve the efficiency of external

energy transactions with the NYISO.2 The NYISO filed companion amendments to its tariffs on December 28, 2011.3

The NYISO agrees with the Filing Parties that CTS can be expected to reduce customers’
energy expenditures in both regions by $100 million or more annually.4 These savings originate
in two results expected from CTS implementation - an increase in the utilization of existing
transmission capacity to move energy more often from the lower price region to the higher price
region and a reduction in the utilization of transmission capacity for counter-intuitive flows or

Transaction Scheduling Market Rules and Request for Waiver Docket ER12-701-000 (filed Dec. 28, 2011)

(“NYISO Filing”). Once CTS is approved, the NYISO expects to expand the use of CTS to transactions at several interconnection points with its other neighbors, such as PJM, through further tariff filings over the next several years. NYISO Filing at fn 25.

at p. 9. This estimate, also referenced in the NYISO Filing at p. 4 and Attachment VI, was developed by the ISO-
NE External Market Monitor, Potomac Economics, which also serves as the NYISO Market Monitoring Unit.

trades from the higher cost region to the lower cost region.5 Increased transmission capacity

utilization will lower the combined cost of generation in the two regions by further displacing

higher cost generation in one region with lower-cost generation from the other. Reducing

counter-intuitive flows will avoid schedules between the regions that require the exporting region to increase production from higher-cost resources while simultaneously causing the importing region to displace lower cost generation.6

These CTS-based improvements in external transactions are vital as the existing

inefficiencies on the system are fairly prevalent. As the Filing Parties explain, data suggests that ISO-NE and the NYISO (“the ISOs”) are currently scheduling power from the high-cost region to the low cost region 44 percent of the time.7 To support these counter-intuitive trades, as
mentioned, the exporting region must increase production from higher-cost resources while,
simultaneously, the importing region must displace lower cost generation. Even when power is moving efficiently from the low-cost to the high-cost region, the data also suggest that
significant transmission capacity is left unused. Until remedied, these inefficiencies leave the production cost savings that can be reasonably expected from efficient external transactions
unrealized and unavailable to the ISOs’ market participants.

The ISOs still have work to do but both expect to be ready to implement this new market
design sometime towards the end of 2013 or the first half of 2014.8 The NYISO encourages the
Commission to consider the Filing Parties’ submission in this docket and the NYISO’s CTS

NE Filing at p. 6.

Id.

NE Filing at p. 8.

NE Filing at p. 2; NYISO Filing at p. 7.

filing in ER12-701-000 concurrently and to issue Orders accepting the tariff revisions for both regions within sixty days of this filing - April 24, 2012.

III.MOTION TO INTERVENE

The NYISO, the balancing authority and transmission grid operator for the New York

Control Area, administers market rules for exporting and importing energy from ISO-NE. It has
filed substantially similar tariff amendments with the Commission in order to allow it and ISO-
NE to implement CTS in their Control Areas simultaneously.9 However, it cannot implement its
market rule enhancements without concurrent implementation by ISO-NE. The NYISO,
therefore, has a direct and substantial interest in the Commission’s decision in this proceeding,
which no other party can adequately represent. Accordingly, it is in the public interest to permit
this intervention.

IV.CONCLUSION

For the reasons stated herein, the NYISO asks the Commission to grant its motion to intervene and to grant the relief described herein.

Respectfully submitted,

/s/_Mollie Lampi_______ Mollie Lampi

Assistant General Counsel
NYISO

10 Krey Blvd.

Rensselaer, NY 12144
Tel: (518) 356-7530
Fax: (518) 356-7678

mlampi@nyiso.com

Dated: March 16, 2012

See: NYISO Filing referenced at fn 2.

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 this proceeding in accordance with the requirements of Rule 2010 of the Rules of Practice and Procedure, 18 C.F.R. §385.2010.
Dated at Rensselaer, NY this 16th day of March, 2012.

/s/ Joy A. Zimberlin

Joy A. Zimberlin

New York Independent System Operator, Inc

10 Krey Blvd.

Rensselaer, NY 12114 (518) 356-6207