UNITED STATES OF AMERICA
BEFORE THE

FEDERAL ENERGY REGULATORY COMMISSION

New York Power Authority and)

Consolidated Edison Company)Docket No. ER12-1624-000

of New York, Inc.)

)

MOTION FOR LEAVE TO FILE ANSWER AND ANSWER TO

THE LIMITED PROTEST AND ANSWER OF THE NRG COMPANIES
BY THE NEW YORK INDEPENDENT SYSTEM OPERATOR, INC.

In accordance with Rules 212 and 213 of the Federal Energy Regulatory Commission’s
(“FERC” or “the Commission”) Rules of Practice and Procedure,1 the New York Independent
System Operator, Inc. (“NYISO”) respectfully requests leave to respond to the Motion to
Intervene and Limited Protest of the NRG Companies (“Limited Protest”) filed in the above-
referenced docket on May 11, 2012 and the Answer of the NRG Companies (“NRG”) filed in the
above-referenced docket on May 30, 2012 (the “May 30 Answer”) .2   The NYISO requests that
the Commission consider this Answer before issuing an Order in the above-captioned
proceeding3 as the Limited Protest and May 30 Answer are not premised upon an accurate
interpretation of the NYISO’s Open Access Transmission Tariff (“OATT”).

1 18 C.F.R. §§ 385.212 and 385.213 (2012).

2 NYISO submitted a Motion to Intervene in the above-referenced docket on May 8, 2012.

3 Filing of an Executed Interconnection Agreement Between the New York Power Authority and

Consolidated Edison Company of New York, Inc., Docket No. ER12-1624-000 (April 26, 2012) (“Interconnection Agreement Filing”).

I.MOTION FOR LEAVE TO FILE ANSWER

Rule 213(a)(2) of the Commission Rules of Practice and Procedure, provides that “an
answer may not be made to a protest, an answer, a motion for oral argument, or a request for
rehearing, unless otherwise ordered by the decisional authority.” 4  The NYISO requests the
Commission to exercise its discretion to grant leave to the NYISO to submit this answer.  The
Commission has accepted responses not permitted by the Commission’s Rules of Practice and
Procedure when they help to clarify complex issues, provide additional information that will

assist the Commission, correct inaccurate statements, or provide otherwise helpful information to
develop the record in a proceeding or assist in the Commission’s decision-making process.5   The
NYISO respectfully requests that the Commission accept the NYISO’s answer in this instance as
well, as it is limited in scope to clarifications of representations made in the Limited Protest and
the May 30 Answer and will therefore clarify the record and assist the Commission in its
deliberations.

II.BACKGROUND

On April 26, 2012, New York Power Authority (“NYPA”) and Consolidated Edison
Company of New York, Inc. (“Con Edison”), collectively “the Parties”, filed a Transmission
Facility Interconnection Agreement (“Interconnection Agreement”) requesting that the
Commission accept the Interconnection Agreement effective May 1, 2012.  In the
Interconnection Agreement, the Parties propose a new transmission tie to connect the Con
Edison Astoria East Substation to the NYPA Astoria Annex Substation (“the Astoria PAR”).

4 18 C.F.R. §385.213(a)(2) (2012).

5 See, e.g., New York Independent System Operator, Inc., 123 FERC ¶ 61,044 at P 39 (2008) (accepting answers to answers because they provided information that aided the Commission’s decision-making process); Morgan Stanley Capital Group, Inc. v. New York Independent System Operator, Inc., 93 FERC ¶ 61,017 at 61,036 (2000) (accepting an answer that was “helpful in the development of the record              ”).

2

The Astoria PAR was proposed by Con Edison as a solution for the local reliability deficiency

that could result in the event of the mothballing of the Astoria No. 2 generator and the concurrent
unavailability of Astoria No. 4 generator.  It has proceeded on an accelerated basis in order to be
available before the beginning of the 2012 Summer Capability Period.6  The Parties sought a
waiver of the 60-day notice period, to accommodate the requested effective date.  The
Commission issued a notice on April 26, 2012 setting a Comments due date of May 17, 2012.
On May 11, 2012, NRG filed its Limited Protest.  NRG states that its protest is limited to cost allocation issues: “In short, the NRG Companies request that the Commission clarify that, for purposes of cost allocation, 2012 Class Year participants be held harmless from any adverse impacts caused by the emergency transmission fix proposed by the parties.”7  On May 23, 2012, NYPA filed a Motion for Leave to Answer and Answer to the Limited Protest (“NYPA
Answer”).  Similarly, Con Edison filed an Initial Response to the limited Protest and a Response
to the Limited Protest on May 15 and May 24, 2012, respectively (collectively “Con Edison
Answer”).  On May 30, 2012, NRG filed an Answer to the NYPA Answer and the Con Edison
Answer.

III. ANSWER TO NRG’S LIMITED PROTEST AND NRG’S MAY 30 ANSWER

The NYISO provides this answer in response to both NRG’s Limited Protest and NRG’s May 30 Answer to clarify issues regarding its administration of the OATT and to clarify

6 Capitalized terms not otherwise defined in this letter have the meaning set forth in Attachments S and X of the OATT.

7 See Limited Protest at pg. 1.

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statements in the Limited Protest which do not accurately characterize the OATT or the NYISO’s administration of the interconnection process under the OATT.8

A.Impact on Class Year 2012 Projects

NRG asserts in its answer that its project in Class Year 2012 is “next in line” for access to an open bus position at the Astoria Annex substation.9   However, NRG’s project does not have
pre-established rights to any bus position.  The project’s cost allocation for upgrades necessary to interconnect to the transmission system, including any required upgrades at Astoria Annex, will be established during the ongoing Class Year 2012 study in accordance with applicable tariff
provisions.10  Because the upgrades and associated cost responsibility have not yet been
determined, it is not appropriate or consistent with the NYISO’s tariff to require that “2012 Class Year participants be held harmless.”11

Under the NYISO’s tariff, interconnection costs are allocated to proposed generation

projects and Merchant Transmission Facilities through the Class Year Interconnection Facilities
Study (“Class Year Study”).12  The Class Year Study evaluates the impacts of a group of
qualifying projects on a combined basis.13 Each project in a Class Year shares in the then

8 The NYISO also seeks to clarify that NRG’s fault current concerns are without basis and indeed, do not accurately represent the 2012 fault current assessment for the Astoria East substation.  Contrary to NRG’s assertion, the Astoria PAR will not prohibit existing generation from operating.  As indicated by the results of the NYISO’s 2012 Fault Current Assessment approved by the Operating Committee on May 17, 2012, the Astoria PAR does not trigger any modification to the current operating protocol for fault current mitigation (“the Operating Protocol”). Moreover, the Operating Protocol does not prohibit existing generation from operating.

9 See Id. at pg. 4.

10 The interconnection procedures administered by the NYISO for Large Generating Facilities and Merchant Transmission Facilities are contained in Attachment X of the OATT.  The Small Generator
Interconnection Procedures are contained in Attachment Z of the NYISO OATT.

11 See Limited Protest at pg. 1.

12 See Attachment S, § 25.6.

13 The Class Year is comprised of projects that have met specified Class Year eligibility requirements specified by Attachment S.

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currently available electrical capability of the transmission system, and each Class Year project shares in the cost of upgrades required to interconnect its respective project based on the pro rata electrical impact of its project.14

The Class Year Study measures the incremental impact of the Class Year projects over a
tariff-defined baseline system.  Under Attachment S, the baseline is defined, for the Minimum
Interconnection Standard, as the Annual Baseline Transmission Assessment (“ATBA”).15  The
Annual Transmission Reliability Assessment (“ATRA”) is then performed on a group basis16 to
determine the upgrades required for each generation and merchant transmission project included
in the Class Year.17   Accordingly, whether facilities are modeled or not modeled in the ATBA
can impact cost allocation.

The tariff requires the NYISO to include in the Existing System Representation18 for
purposes of the ATBA for a given Class Year, specified existing and planned generation and
transmission facilities, specified generation and transmission retirements and derates, and:

(iv) all other changes to existing facilities, other than changes that are subject to Class Year cost allocation but that have not accepted their Class Year cost
allocation, that are identified in the Load and Capacity Data Report or reported by Market Participants to the NYISO as scheduled to occur during the five year cost allocation study planning period.19

The Astoria PAR is a transmission facility identified in the NYISO’s 2012 Load and
Capacity Data Report (“2012 Gold Book”), which is the Gold Book that will be the existing

14 See Attachment S, §§ 25.5.7, 25.6.2.5.1.

15 The ATBA identifies the SUFs that Transmission Owners are expected to need to ensure reliability.

16 The ATRA is created by adding the Class Year projects to the ATBA and is performed on a group basis with the exception of the Attachment Facilities and Local SUFs required to accommodate an interconnection, which are studied on an individual project basis.

17 A similar process is followed in the Class Year Deliverability Study which determines the SDUs required for each generation and merchant transmission project included in a Class Year.

18 The Existing System Representation is defined as “[t]he representation of the New York State Power System developed as specified in Section 25.5.5 of these rules.”  See Attachment S, § 25.1.2.

19 Attachment S, § 25.5.5.1 (emphasis added).

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Gold Book when the ATBA for the Class Year 2012 Study is finalized.  Accordingly, the

NYISO anticipates that it will model the Astoria PAR and its interconnection to an available bus
positions at the Astoria Annex substation in the Existing System Representation in the ATBA for
the Class Year 2012 Study.20    This means that the incremental impact of Class Year 2012
projects, including NRG’s project, will be measured over a baseline system that includes the
Astoria PAR

B.NRG’s Reference to the Commission’s “First-in-Time” Precedent is

Misplaced.

Relying on its “higher” queue position, NRG insists that “the OATT and Commission
precedent require that the Astoria PAR project hold the 2012 Class Year participants harmless from any increases in costs as a result of allowing the interconnection to proceed … . Con Ed has no right to jump to the front of the queue.” 21  However, the Astoria PAR is not subject to the
NYISO interconnection process under Attachments S and X, and, accordingly, is not evaluated as a project in the Class Year Study.22  Attachment X applies to both generation and merchant
transmission; however, merchant transmission does not include Transmission Owner
transmission projects such as the Astoria PAR.23

20 NRG’s project in Class Year 2012 had the opportunity to have its cost allocation determined in earlier

Class Years that did not model the Astoria PAR in the ATBA.  NRG’s project was a member of Class year 2010, but NRG elected not to accept its cost allocation from that study.  NRG’s project also could have entered Class Year 2011, but NRG chose instead to enter Class Year 2012.

21 See Limited Protest at pgs. 4-5.

22 See Attachment S (Rules to Allocate Responsibility for the Cost of New Interconnection Facilities); Attachment X (Large Generator Interconnection Procedures).

23 See Attachment X, § 30.1, Merchant Transmission Facility (providing, in part, “Merchant Transmission
Facilities shall be those transmission facilities developed by an entity that is not a Transmission Owner … shall not
include upgrades or additions to the New York State Transmission System made by a Transmission Owner ….”)

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Contrary to NRG’s assertion that the Astoria PAR “skipped the process (an

interconnection request and System Impact Study),”24  Transmission Owner transmission

projects such as the Astoria PAR have been treated as outside the defined scope of the NYISO interconnection process and require only a two-party Interconnection Agreement - an
Interconnection Agreement to which the NYISO is not a party.25  Even if the Astoria PAR
required a System Impact Study under Section 3.7 of the NYISO OATT, and had a queue
position, it would not be evaluated as a proposed project in a Class Year, nor would the manner in which it is modeled in the Class Year 2012 ATBA be any different.

Transmission Owners are, however, allocated the cost of any upgrades required in the
ATBA, including any upgrades that could be triggered by a new Transmission Owner project
(i.e., Class Year projects do not share in the cost responsibility for such upgrades).  Therefore,
NRG’s contention that the Astoria PAR should “take its place in line behind already planned
projects in the 2012 Class Year …”26 is not consistent with the NYISO interconnection process.

Furthermore, NRG’s apparent reference to a “first-in-time”” process articulated by the
Commission in Virginia Electric and Power Company (“VEPCO”) 27 is misplaced under these
circumstances.  NRG contends that because Class Year 2012 projects have a higher queue
position than the Astoria PAR, Commission precedent allows the Astoria PAR to use existing
system facilities, “so long as [Con Edison] commits to pay for any facilities needed to
interconnect new generators with queue priority if and when those projects are ready to

24 See NRG’s May 30 Answer at pg. 5.

25 Similar projects have likewise been treated as outside the defined scope of the NYISO interconnection process.  See, e.g., Consolidated Edison Company of New York, Inc., Docket No. ER10-1193-000, Letter Order dated June 3, 2010; Consolidated Edison Company of New York, Inc., Docket No. ER09-1515-000, Letter Order dated September 3, 2009; Niagara Mohawk Power Corporation, 121 FERC ¶ 61,183 (2007); Consolidated Edison Company of New York, Inc., 119 FERC ¶ 61,206 (2007).

26 See Limited Protest at pg. 4.

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interconnect.”28    NRG seems to rely on the standard set forth in VEPCO, in which the

Commission directed Dominion Virginia Power to allow a lower-queued project (“Project 2”) to
use the transmission capability that had been set aside for a higher-queued project (“Project 1”),
explaining:

Then, if and when [Project 1] completes its project and

interconnection, [Project 2] will have to fund the network upgrades needed for [Project 1]'s interconnection to the extent that the need for the upgrades is due to [Project 2]'s use of the excess
transmission capability and [Project 2]'s decision to have its
interconnection completed ahead of [Project 1].29

Notably, however, the Commission subsequently clarified the manner in which the

VEPCO standard would apply in the context of the NYISO interconnection process.  In an

August 2008 Order on Requests for Clarification of a previous order - the January 2008 order
NRG relies on in its Limited Protest30 - the Commission clarified the significance of queue
priority with respect to cost allocation in the NYISO interconnection process. 31  Recognizing
that the NYISO OATT does not assign facilities or allocate costs based on queue position, the
Commission stated:

We clarify that it was not the Commission’s intention to displace NYISO’s
existing cost allocation and facility assignment procedures or its intention to

27 See Virginia Electric and Power Company, Docket Nos. ER03-743-001, ER03-743-002, 104 F.E.R.C. ¶ 61,249 Orders on Compliance Filing and Rehearing (Sept. 10, 2003 ).  VEPCO addressed a situation where the project that was assigned use of an open bus position was not the first project to be in a position to use it - the
second project to which cost of the expansion was allocated was the first to be ready to use the bus position.  That is inapposite to the situation here vis-à-vis NRG and the Astoria PAR.

28 See Limited Protest at pg. 5.

29 See VEPCO at P19 (adding, in note 21 that “[Project B] would also be responsible for any additional study costs”).

30 See Limited Protest at pg. 5 (citing Hudson Transmission Partners, LLC v. New York Independent System Operator, Inc., 122 FERC ¶ 61,024 (2008) at P 33).

31 See Hudson Transmission Partners, LLC v. New York Independent System Operator, Inc., 124 FERC ¶ 61,182 (2008) at P12.

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elevate queue position to a significance beyond that which it already has under the OATT.32

As the Commission’s above-referenced Order makes clear, the VEPCO standard is not
intended to disrupt the cost allocation established under the NYISO OATT.  Likewise, NRG’s
requests to alter the cost allocation that would be required by the NYISO’s OATT should be
denied.

IV.CONCLUSION

WHEREFORE, for the foregoing reasons, the NYISO respectfully requests that the

Commission accept and consider its answer to the Limited Protest before issuing an Order in the above-captioned proceeding.

Respectfully submitted,

/s/ Sara B. Keegan

Sara B. Keegan
Senior Attorney

New York Independent System Operator, Inc.

10 Krey Blvd.

Rensselaer, New York 12144 (518) 356-8554

skeegan@nyiso.com

May 31, 2012

32 See Id. at P14; see also Id. at P20 (adding that, “HTP is incorrect in asserting that it has a priority based on queue position.”).

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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, New York this 31st day of May, 2012.

By:/s/ John C. Cutting

John C. Cutting

Regulatory Affairs Senior Specialist

New York Independent System Operator, Inc.

10 Krey Blvd.

Rensselaer, NY 12144 (518) 356-7521

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