10 Krey Boulevard Rensselaer, NY 12144
September 19, 2016
By Electronic Delivery
Honorable Kimberly D. Bose Secretary
Federal Energy Regulatory Commission 888 First St, NE
Washington, DC 20426
Re: New York Independent System Operator, Inc., Compliance Filing, Docket No. ER16-
120-___
Dear Secretary Bose:
The New York Independent System Operator, Inc. (“NYISO”) hereby submits this
compliance filing to fulfill the directives of the Federal Energy Regulatory Commission
(“Commission”) in its April 21, 2016, Order on Compliance and Rehearing in the above-
captioned proceeding (“April Order”) and in accordance with the Commission’s May 26, 2016,
Notice of Extension of Time.1 The NYISO respectfully requests that the compliance tariff
revisions proposed in this filing become effective on October 20, 2015 as described in Part VII
below.2
The NYISO’s compliance filing in response to the April Order was due by 5 PM on
Monday, September 19, 2016. Due to technical issues in the electronic submission of the
NYISO’s filing, the NYISO was unable despite its best efforts to submit its compliance filing
until after the 5 PM deadline. Given the circumstances, there was no opportunity for the NYISO
to seek an extension of time before the deadline expired. Consequently, the NYISO respectfully
requests that the Commission grant any required motions to accept the compliance filing one
day out of time.
I. SUMMARY OF DIRECTIVES AND COMPLIANCE FILING
The NYISO submits with this filing proposed revisions to its Open Access Transmission Tariff (“OATT”) and Market Administration and Control Area Services Tariff (“Services
1 N.Y. Indep. Sys. Operator, Inc., Order on Compliance and Rehearing, 155 FERC ¶ 61,076
(2016) (“April Order”); N.Y. Indep. Sys. Operator, Inc., Notice of Extension of Time, Docket No. ER16-
120-000 (May 26, 2016).
2 The NYISO requests in Part VII below a separate effective date of April 1, 2016, for Section
31.11 of the OATT - Form of Operating Agreement.
Honorable Kimberly D. Bose September 19, 2016
Page 2
Tariff”) to address the Commission’s directives in the April Order and in its initial February 19,
2015 order directing the NYISO to establish reliability must run (“RMR”) tariff requirements
(“Initial RMR Order”).3 All of the proposed revisions included in this compliance filing are
expressly required by the April Order and Initial RMR Order, are necessary to implement or
clarify the existing tariff language to accommodate the Commission’s directives, or are non-
substantive organizational or clarifying adjustments of the kind that the Commission has
previously permitted in compliance filings.4 Affidavits in support of this compliance filing are
provided by Zachary G. Smith, Vice President, System and Resource Planning, and Shaun
Johnson, Director of the Market Mitigation and Analysis Department. The NYISO respectfully
submits that its proposed compliance tariff revisions fully comply with the directives of the April
Order and Initial RMR Order, are fully supported, are just and reasonable, and should be
accepted without modification or condition.
As described in detail in this filing letter, the NYISO’s proposed tariff revisions address the Commission’s directives as follows:
• Develop a Generator Deactivation Process that is separate from the NYISO’s existing Gap
Solution process.
The NYISO proposes to implement the reliability-must-run requirements in a new Generator
Deactivation Process5 located in Attachment FF of its OATT. This process is separate and
distinct from the NYISO’s Gap Solution process located in Attachment Y of the OATT. As
described in Part III of this filing letter, the Generator Deactivation Process establishes the
requirements by which the NYISO will assess whether a reliability need will result from a
Generator’s becoming Retired, entering into a Mothball Outage or being unavailable due to
an ICAP Ineligible Forced Outage (collectively “deactivation”). If a Generator Deactivation
Reliability Need cannot be timely addressed in the NYISO’s biennial reliability planning
process, the NYISO will solicit and evaluate solutions to the need, including alternatives to
entering into an RMR Agreement. The NYISO will be the party independently responsible
for evaluating and selecting solutions to Generator Deactivation Reliability Needs. Only the
3 N.Y. Indep. Sys. Operator, Inc., Order Instituting Section 206 Proceeding and Directing Filing to
Establish Reliability Must Run Tariff Provisions, 150 FERC ¶ 61,116 at P 9 (2015) (“Initial RMR
Order”). The Commission initially provided the NYISO with 120 days to submit its compliance filing.
Id. at P 4. The Commission subsequently granted the NYISO a further 120 days to submit its compliance
filing. New York Indep. Sys. Operator, Inc., Notice of Extension of Time, Docket No. EL15-37-000 (June
4, 2015).
4 See New York Independent System Operator, Inc., 125 FERC ¶ 61,206 (2008), reh’g, 127 FERC
¶ 61,042 (2009) (accepting proposed additional tariff revisions that were necessary to implement the
modifications directed by the Commission and to correct drafting errors or ambiguities in a compliance
filing).
5 Capitalized terms that are not defined in this filing letter have the meaning ascribed to them in the NYISO’s Tariffs or in the proposed Tariff revisions submitted with this filing. Many of the terms that the NYISO defined to implement its Generator Deactivation Process are defined in the proposed revisions to Sections 1.18 or 38.1 of the OATT, or in Rate Schedule 8 to the Services Tariff.
Honorable Kimberly D. Bose September 19, 2016
Page 3
NYISO may enter into an RMR Agreement with a Generator. The selection process
establishes a preference for non-RMR Agreement alternatives and is designed to make RMR service a temporary, last resort solution.
•Develop rules that specify when the RMR process will apply, and when the existing Gap
Solution planning process will apply.
As described in Part III.B.i of this filing letter, Attachments Y and FF of the OATT establish that the NYISO will apply the Generator Deactivation Process, and not the Gap Solution
process, to address the impacts of noticed Generator deactivations and of Generators that
enter an ICAP Ineligible Forced Outage. The NYISO will continue to apply the Gap
Solution Process in Attachment Y to evaluate and address immediate reliability threats
resulting from causes other than a Generator’s deactivation that cannot be timely addressed in the biennial reliability planning process.
• Establish rules making the NYISO solely responsible for evaluating and selecting solutions to
identified Reliability Needs caused by Generator deactivations.
Under the rules proposed in this filing, the NYISO is the sole entity responsible for
evaluating and selecting solutions to Generator Deactivation Reliability Needs. If the
NYISO determines that a reliability need results from a Generator’s deactivation, the NYISO
is responsible for soliciting, evaluating, and selecting among all proposed solutions. If the
need is a Near-Term Generator Deactivation Reliability Need (occurring within three years
of the conclusion of the 365-day Generator deactivation notice period), the NYISO will
designate the Responsible Transmission Owner as the entity responsible for proposing a
regulated solution, and will fully explain and allow stakeholders to comment on the rationale
for its decision to assign this role to the Responsible Transmission Owner. If the NYISO
performs a competitive selection process, it will solicit and select from among the competing
Viable and Sufficient solutions in accordance with the selection criteria described below.
• Develop a deactivation notice period and RMR evaluation timetable that reflects the
establishment of an RMR process that is distinct from the Gap Solution process.
A Market Participant must provide a minimum of 365 days prior notice before its Generator
may be Retired or enter into a Mothball Outage, which period begins after the NYISO
determines its Generator Deactivation Notice has been completed. The NYISO will also
conduct the Generator Deactivation Process over a 365 day period for a Generator that has
entered into an ICAP Ineligible Forced Outage, starting on the date the Generator enters into
the ICAP Ineligible Forced Outage. The 365 day period is the shortest period practicable for
the NYISO to complete each of the steps of the Generator Deactivation Process, which steps
were developed to address the directives of the Initial RMR Order and April Order. The
NYISO’s anticipated time frames to perform each of the process steps are based on its
longstanding experience in administering its planning and market monitoring requirements
and performing related responsibilities.
Honorable Kimberly D. Bose September 19, 2016
Page 4
• Submit criteria for implementing the “distinctly higher” net present value standard to select
from among possible Generator and non-generation solutions to identified Reliability Needs, provide a conceptual basis as to how the “distinctly higher” standard will be implemented, and define the criteria that the NYISO will propose to make its selection.
As described in Part III.H of this filing letter, the NYISO’s proposal establishes the criteria
governing the application of the “distinctly higher” net present value standard, as well as the
criteria governing the NYISO’s ultimate selection of a solution to a Generator Deactivation
Reliability Need. Executing an RMR Agreement with a Generator is designed to be a last
resort to addressing a Generator Deactivation Reliability Need. For purposes of the
Generator Deactivation Process, “last resort” means that the NYISO will only enter into an
RMR Agreement when: (i) there is no Viable and Sufficient transmission solution, or (ii) if a
Viable and Sufficient transmission solution is available, then the Viable and Sufficient
generation solution must have a distinctly higher net present value than the transmission
solution, and the advantages of entering into an RMR Agreement with the Generator must
outweigh the advantages of selecting the transmission solution. The NYISO has defined the
criteria it will use when assessing the benefits and detriments of each solution. Key criteria
include the expected expandability, operability and performance of each solution. The
NYISO will determine if a Generator has a “distinctly higher net present value” than a
transmission solution by calculating accuracy ranges of each transmission and generation
project cost estimate and determining whether the range of net present values of the
generation solution is higher than the range of the net present values of the transmission
solution. The NYISO may also enter into an RMR Agreement on a temporary basis, if
necessary, to permit it to complete the resource selection process.
• Exempt RMR Generators from offer floor mitigation in capacity auctions and require all
such generators to offer their capacity as price-takers.
As described in Part IV.B, consistent with the Commission’s instructions in its April Order, the NYISO has amended both its Services Tariff and its OATT to make clear that capacity offers from RMR Generators will not be subject to offer floor mitigation and will be offered into the ICAP markets at $0.00/kW-month.6
• Propose a cost allocation methodology for its RMR process that is separate from its Order
No. 1000-compliant regional transmission cost allocation methodology.
6 The NYISO has requested rehearing of certain aspects of the Commission’s directives in the
April Order that it implements in this filing, including the Commission’s instruction that the NYISO must
require all RMR Generators to offer into capacity auctions as price-takers and must implement an
additional claw-back refund mechanism. New York Independent System Operator, Inc., Request for
Rehearing and Clarification of the New York Independent System Operator, Inc., Docket No. ER16-120-
001 (May 23, 2016) (“NYISO Rehearing Request”). If the Commission grants the NYISO’s rehearing
request, the NYISO will submit the necessary changes in a future compliance filing, consistent with the
Commission’s direction.
Honorable Kimberly D. Bose September 19, 2016
Page 5
As described in Part VI of this filing letter, the NYISO proposes to use a “needs-based”
methodology to allocate the costs of an RMR Agreement or a transmission solution selected
by the NYISO to address a Generator Deactivation Reliability Need. The methodology
allocates the costs of the solution to those Load Serving Entities in New York that contribute
to the Generator Deactivation Reliability Need and primarily benefit from the solution to the
need. The methodology utilizes the cost allocation formulation for the NYISO’s reliability
planning process, as recently revised and accepted by the Commission to address both
transmission security and resource adequacy needs.7 The methodology in the Generator
Deactivation Process adds to the methodology accepted in the reliability planning process by
providing that the NYISO can allocate the costs of solutions to reliability needs that arise on
the local, non-Bulk Power Transmission Facilities that result from a Generator’s
deactivation.
• Expand the “anti-toggling” protections by requiring an RMR generator that wishes to
operate at the end of its RMR agreement to repay the NYISO the higher of capital
expenditures less depreciation or the above-market payments that it received.
Rate Schedule 8 of the Services Tariff governs compensation for RMR Generators and
Interim Service Providers. As described in Part IV.C of this filing letter, Rate Schedule 8 has
been revised to require that a Generator that wants to return to participate in the NYISO’s
markets after operating pursuant to an RMR Agreement or as an Interim Service Provider
must reimburse the NYISO for the higher of: (1) the Capital Expenditures that were paid for
by RMR Loads to permit the Generator to operate, or (2) the amount by which the payment
under the RMR Agreement or to the Interim Service Provider (including payments to
reimburse Capital Expenditures) exceeded the amounts the Generator would have received
had it been participating in the ISO Administered Markets at market-based rates.
• Specify that the NYISO may finish a non-generation solution that is substantially complete at
the time a Generator rescinds its Generator Deactivation Notice.
As described in Part III.L of this filing letter, the NYISO will not halt a selected transmission project once the Developer has received its applicable permits or authorizations under state law, or if permitting is not required, after physical construction has commenced. In other circumstances, the NYISO may decide to halt a transmission project based on a set of
proposed detailed criteria. Cost recovery is provided for all halted projects.
• Define the circumstances under which a non-generation solution that NYISO selects in the
RMR process can serve as the permanent solution to an identified Reliability Need.
As described in Part III.M of this filing letter, the NYISO may select a permanent solution in
the Generator Deactivation Process. If the NYISO is required to select an interim solution in
the Generator Deactivation Process, including entering into an RMR Agreement, it will not
7 New York Independent System Operator, Inc., Letter Order, Docket No. ER16-1968-000 (August 12, 2016).
Honorable Kimberly D. Bose September 19, 2016
Page 6
take these temporary solutions into account in determining whether there is a reliability need in its next biennial reliability planning process. If the need continues to exist, the NYISO will identify a permanent solution through its biennial reliability planning process.
• NYISO proposal to pay an avoidable cost rate to Interim Service Providers that are required
to operate after the requested deactivation date, during days 181 to 365 of the 365 day
period.
As described in Part IV.A, consistent with its December 21, 2015 Request for Leave to
Answer and Answer at pages 10-11, 17 and 21-23, the NYISO proposes changes to Rate
Schedule 8 of the Services Tariff, added Section 38.13 of the OATT, and proposed revisions
to other tariff sections to require it to pay an avoidable cost rate to Generators that (a) are not
permitted to deactivate on the date the Generator asked to be permitted to deactivate, and
(b) that are required to remain available for days 181 to 365 of the 365 Day Notice Period
that is defined in proposed Section 15.8.6 of Rate Schedule 8 to the Services Tariff. The
proposed compensation rule supports the NYISO’s efforts to develop just and reasonable
rates.
TABLE OF CONTENTS
I.SUMMARY OF DIRECTIVES AND COMPLIANCE FILING....................1
II.BACKGROUND........................................................8
III.GENERATOR DEACTIVATION PROCESS..................................9
A.New Generator Deactivation Process...................................9
i.RMR Process Background.....................................9
ii.Summary of Generator Deactivation Process......................11
B.Identification of Generator Deactivation Reliability Need..................12
i.Commencing the Generator Deactivation Process..................12
ii.Commencement of 365 Day Notice Period.......................13
iii.Need for a 365 Day Notice Period..............................14
iv.Generator Deactivation Assessment.............................16
v.Near-Term Generator Deactivation Reliability Need................17
C.Solicitation of Generator Deactivation Solutions.........................20
i.Solicitation of Generator Deactivation Solutions...................20
ii.Responsible Transmission Owner Requirements for New
Transmission Owners........................................22
iii.Study Costs................................................22
iv.Review of Deactivated Generator(s) that Are Eligible to Return.......23
Honorable Kimberly D. Bose September 19, 2016
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v.NYISO’s Consideration of Demand Response and Generators
Located Outside the New York Control Area as Generator
Deactivation Reliability Need solutions..........................24
D.Information Requirements and NYISO Review..........................24
i.Cost, Revenue, and Other Information Requirements...............24
ii.Review of Appendix B Cost, Revenue, and Other Information........25
E.NYISO Evaluation of Viability and Sufficiency of Generator Deactivation
Solutions........................................................25
F.Determining RMR Avoidable Costs...................................26
G.RMR Service Offers...............................................27
H.Solution Selection Process..........................................28
I.Entry into RMR Agreements........................................30
J.Developer’s Responsibility Following Selection of Transmission Solution....31
i.Responsible Transmission Owner’s Obligation to Construct..........31
ii.Developer’s Responsibility to Obtain Necessary
Approvals/Authorizations.....................................31
iii.Development Agreement.....................................32
K.Generator’s Failure to Deactivate.....................................33
i.Deactivation Time Frame.....................................33
ii.Study Cost Recovery........................................33
L.Halting.........................................................34
M.Addressing Reliability Needs on a Permanent Basis......................35
IV.PROPOSED COMPLIANCE REVISIONS ADDRESSING COMPENSATION,
MARKET PARTICIPATION, “ANTI-TOGGLING” PROTECTION AND
OTHER ISSUES........................................................36
A.Revisions that Provide for Interim Compensation During the Second Half
of the Proposed 365 Day Generator Deactivation Notice Period.............36
i.Justification for Compensating Generators During the Notice
Period....................................................36
ii.Overview of Proposed Interim Service Provider Compliance
Revisions..................................................37
iii.Rate Schedule 8: Availability and Performance Rate Payments to
Interim Service Providers.....................................39
iv.Section 23.6: Participation by Interim Service Providers in the
NYISO-Administered Energy and Ancillary Services Markets........40
Honorable Kimberly D. Bose September 19, 2016
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v.Exclusion of Interim Service Providers’ UCAP from the Pivotal
Supplier Calculation.........................................41
vi.Voltage Support Obligations..................................41
B.Revisions that Require RMR Generators and Interim Service Providers to
Offer Capacity as “Price-Takers” and that Address the Application of
Offer Floors Under the Buyer-Side Market Power Mitigation Measures.......42
C.Revisions to Establish Additional “Anti-Toggling” Measures and to
Govern Repayment Periods.........................................44
D.RMR Credit Rules................................................47
E.MMU Responsibilities.............................................47
V.FORM OF RELIABILITY MUST RUN AGREEMENT........................48
VI.COST ALLOCATION AND COST RECOVERY.............................49
A.Generator Deactivation Process Cost Allocation Methodology..............49
B.Justification for Cost Allocation Methodology..........................54
C.Cost Recovery Requirements........................................55
i.Cost Recovery for Regulated Transmission Solutions...............55
ii.Cost Recovery for RMR Generators Operating Under RMR
Agreements................................................56
iii.Other.....................................................57
VII.EFFECTIVE DATE.....................................................57
VIII.COMMUNICATIONS...................................................57
IX.LIST OF DOCUMENT SUBMITTED......................................58
X.SERVICE.............................................................59
XI.CONCLUSION.........................................................59
II.BACKGROUND
On February 19, 2015, the Commission issued the Initial RMR Order determining that
the NYISO is the appropriate entity to administer RMR service in New York under its tariffs.8
The Commission stated that it was “fundamental to the proper and efficient operation of
NYISO’s markets” for the rates, terms, and conditions for RMR service to be on file and that the
absence of such requirements rendered the NYISO’s tariffs unjust and unreasonable.9 For this
reason, the RMR Order directed the NYISO to submit proposed tariff revisions to establish an
8 Initial RMR Order at P 3.
9 Initial RMR Order at P 9.
Honorable Kimberly D. Bose September 19, 2016
Page 9
RMR process to govern “the retention of and compensation to generating units required for
reliability, including procedures for designating such resources, the rates, terms and conditions for RMR service, provisions for the allocation of costs of RMR service, and a pro forma service agreement for RMR service.”10
On October 19, 2015, the NYISO submitted its compliance filing in response to the
Initial RMR Order (“October 2015 Filing”).11 On April 21, 2016, the Commission ruled on the October 2015 Filing with its Order on Compliance and Rehearing. The April Order accepted this filing subject to a number of compliance directives, each of which is addressed in detail
below. On June 7, 2016, the NYISO submitted an initial limited compliance filing in Docket No. ER16-120-002 to remove language from its OATT that was rejected by the April Order. The Commission accepted this filing on July 1, 2016.
The NYISO has worked diligently with its stakeholders to respond to the Commission’s
directives. During the five months following the issuance of the April Order, the NYISO held
multiple stakeholder meetings to develop the proposed compliance tariff revisions that are
submitted in this second compliance filing. The NYISO presented the proposed Generator
Deactivation Process and related provisions, rate schedules, and pro forma service agreement at
a series of stakeholder working group meetings that were held on the following dates: July 26,
2016, August 9, 2016, August 10, 2016, August 25, 2016, September 1, 2016, September 7,
2016, and September 13, 2016. These meetings often involved a combination of stakeholder
working groups focused on planning, energy markets, and installed capacity issues. At each of
the meetings, the NYISO requested, received, and considered comments from interested parties.
The NYISO incorporated feedback from stakeholders on multiple issues and made
numerous revisions to the proposed Generator Deactivation Process and related changes.
Although a consensus was not reached on all issues, the open and transparent process facilitated the NYISO’s and stakeholders’ understanding of concerns, issues, and proposals and narrowed differences on many issues. The NYISO appreciates its stakeholders’ efforts to review certain revisions the NYISO proposed on comparatively short notice.
III.GENERATOR DEACTIVATION PROCESS
A.New Generator Deactivation Process
i.RMR Process Background
In the April Order, the Commission rejected the NYISO’s proposal to locate the RMR
process within the existing Gap Solution process because it did not approve the role of the New
York State Public Service Commission (“NYPSC”) in selecting non-generation solutions.12 The
10 Initial RMR Order at P 11.
11 N.Y. Indep. Sys. Operator, Inc., Compliance Filing, Docket No. ER16-120-000 (October 19, 2015) (“October 2015 Filing”).
12 April Order at PP 31-41.
Honorable Kimberly D. Bose September 19, 2016
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Commission directed the NYISO to establish an RMR process separate from its Gap Solution
process in which the NYISO would evaluate and select solutions to the reliability needs resulting from Generator deactivations.13 The Commission deferred ruling on the individual RMR
process elements proposed in the October 2015 Compliance Filing until it reviewed the process proposed by the NYISO separate from the Gap Solution process.14
In response to the April Order, the NYISO proposes to create a separate new Generator Deactivation Process, which is located in a new Attachment FF (Section 38) of the OATT. The Generator Deactivation Process is consistent with the Commission’s directives for an RMR
process set forth in the April Order and the Initial RMR Order, which process requirements are summarized as follows:
• Establishes an RMR process separate from the existing Gap Solution process;15
• Includes a clear schedule by which a Generator must inform the NYISO of its proposed
deactivation and by which the NYISO will notify the Generator whether it is required for
reliability or can be deactivated;16
• Sets forth the process for conducting the reliability analysis necessary to determine
whether there is a reliability need for the deactivating Generator, including coordinating,
reviewing, and verifying any study work performed by the local Transmission Owner;17
• Sets forth the process the NYISO will use to identify alternative solutions to RMR
contracts and to provide for thorough consideration of alternatives in an open and
transparent matter to ensure that RMR agreements are only used as a limited, last resort measure;18
• Makes the NYISO solely responsible for evaluating and selecting the solutions to
reliability needs resulting from Generator deactivations, whether market-based solutions,
generation solutions, or non-generation solutions,19 including determining whether a
specific Generator is needed to maintain reliability and be designated an RMR unit; and20
13 April Order at PP 31, 41.
14 April Order at P 31.
15 April Order at P 41.
16 Initial RMR Order at P 13.
17 Initial RMR Order at PP 13-14.
18 Initial RMR Order at P 16.
19 April Order at P 41.
20 Initial RMR Order at P 14.
Honorable Kimberly D. Bose September 19, 2016
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• Establishes a separate cost allocation methodology and process outside of the NYISO’s
reliability planning process.21
ii.Summary of Generator Deactivation Process
Under the Generator Deactivation Process, the NYISO will perform a Generator
Deactivation Assessment to determine whether a Generator Deactivation Reliability Need would
result from a Generator’s deactivation. The NYISO will use its most recent reliability planning
base case, updated for the most current data and Local Transmission Owner Plans. If the
assessment identifies a Generator Deactivation Reliability Need that cannot timely be addressed
through the NYISO’s biennial reliability planning process, the NYISO will solicit and evaluate
the viability and sufficiency of market-based and regulated Generator Deactivation Solutions as
alternatives to the NYISO entering into an RMR Agreement to address the need. If the
reliability need will arise within three years, the NYISO will designate the Responsible
Transmission Owner as the sole party eligible to propose a regulated alternative to a generation
solution. In evaluating alternative solutions, the NYISO will consider entering into an RMR
Agreement with the Generator that may deactivate or with one or more Generators that have
deactivated, but that are eligible to return, on a temporary basis to maintain system reliability.
The first set of solutions the NYISO will consider to address an identified Generator
Deactivation Reliability Need are market-based solutions that are not eligible for additional cost recovery under the NYISO Tariffs. If there are not adequate market-based or demand response solutions to fully address the need, the NYISO will select one or more solutions from the Viable and Sufficient transmission and generation alternatives to address the Generator Deactivation Reliability Need. In choosing between competing solutions, the NYISO will make its selection in the manner described in Part III.H of this filing letter.
If the NYISO selects a transmission solution to address the need, it will enter into a
Development Agreement with the transmission Developer. The costs of the transmission
solution will be allocated under Attachment FF and recovered under Rate Schedule 16 to the
OATT. Consistent with the rules set forth in its solution selection process, the NYISO may enter
into an RMR Agreement with one or more Generators, including the deactivating Generator.
Payments will be made to Generators under Rate Schedule 8 of the Services Tariff. The costs
associated with the RMR Agreement will be allocated to the RMR Loads and recovered under
Rate Schedule 14 to the OATT. If the NYISO enters into an RMR Agreement with a Generator
or selects an interim transmission solution to address the need, the NYISO will not consider that
temporary solution in its biennial reliability planning process when determining whether a
reliability need exists for which the NYISO must solicit a permanent solution.
21 April Order at P 112.
Honorable Kimberly D. Bose September 19, 2016
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B.Identification of Generator Deactivation Reliability Need
i.Commencing the Generator Deactivation Process
The NYISO will commence the Generator Deactivation Process when either: (i) a Market Participant submits to the NYISO a Generator Deactivation Notice in the form set forth in
Appendix A of Attachment FF indicating its intent for its Generator to be Retired or enter into a Mothball Outage, or (ii) a Market Participant’s Generator has entered into an ICAP Ineligible Forced Outage.22 These Generators are referred to as “Initiating Generators.”23
The NYISO may accelerate its Generator Deactivation Process and take immediate action if it identifies an immediate reliability need that it determines cannot be timely addressed through the normal Generator Deactivation Process.24 In such case, the NYISO may abbreviate, as
necessary, the time periods and requirements of its Generator Deactivation Process and make any necessary filings with the Commission to maintain reliability.25 The NYISO requires this
flexibility to enable it to maintain reliability if a Generator Deactivation Reliability Need arises on short notice and must be addressed immediately to maintain reliability.26
The Generator Deactivation Process is separate from the Gap Solution process in
Attachment Y of the OATT. The NYISO proposes revisions to its Gap Solution process
requirements in Sections 31.1.2 and 31.2.11.3 to clarify that it will address any Generator
Deactivation Reliability Need or immediate reliability need that results from a Generator’s
deactivation in accordance with Attachment FF of the OATT.27 The Gap Solution process will
be used to address imminent threats to reliability from causes other than deactivation of a
Generator.
22 Proposed OATT Sections 38.3.1, 38.3.2. The Initial RMR Order indicated that generator “deactivation” encompasses “generator retirements, mothballing, or any other long-term outages or suspension of service.” Initial RMR Order at P 1 n. 2.
23 Proposed OATT Section 38.1 (definition of “Initiating Generator”).
24 Proposed OATT Section 38.3.3.
25 Proposed OATT Section 38.3.3.
26 The proposed process is intended to parallel the provisions in the Gap Solution process that are used to address “imminent threats” to reliability, which the Commission has previously approved. New York Independent System Operator, Inc., Order Accepting in Part and Rejecting in Part Tariff
Amendments, 109 FERC ¶ 61,372 (2004), Order on Rehearing and Compliance, 111 FERC ¶ 61,182 (2005) (accepting NYISO’s Gap Solution process).
27 See April Order at P 41 (“In developing a separate RMR process, NYISO should develop additional tariff revisions to clarify when its separate RMR process will be triggered, as opposed to its existing Gap Solution process.”).
Honorable Kimberly D. Bose September 19, 2016
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ii.Commencement of 365 Day Notice Period
The Commission directed the NYISO to establish a clear time frame to govern the
schedule by which it must be notified of a Generator’s proposed deactivation and by which it must give notice of whether or not the Generator is needed for reliability or may deactivate.28 Consistent with this directive, the NYISO proposes to require up to 365 days advanced notice if a Generator seeks to be Retired or to enter into a Mothball Outage.29 The 365 day period will begin to run on the “Generator Deactivation Assessment Start Date.”30
For a Generator proposing to be Retired or enter into a Mothball Outage, the Generator Deactivation Assessment Start Date will be the date that the NYISO issues written notice to the Market Participant that its Generator Deactivation Notice form is “complete” (as described
below).31 The Generator Deactivation Notice form is included in proposed Section 38.24
(Appendix A) of Attachment FF.32 The Generator Deactivation Form requires the Market
Participant to provide pertinent information, including the date that the Generator proposes to be Retired or enter into a Mothball Outage and confirmation regarding whether a Generator
proposing to enter into a Mothball Outage is able to return to service within 180 days. The
Market Participant must also provide cost, revenue, and other information that is specified in
Section 38.25 (Appendix B) of Attachment FF.33 The NYISO will review the submitted
information and may request additional information.
The Generator Deactivation Notice will be considered “complete” when the NYISO
determines that it has received sufficient information to begin reviewing both: (i) the reliability impacts that would result from the Generator being Retired or entering into a Mothball Outage and, (ii) the market and related information required by Appendix B.34 The NYISO will notify the Market Participant when its notice is complete and post non-confidential information about the completed notice on its website.35 Market Parties36 are subject to a continuing obligation to promptly submit any additional information required by the NYISO.37
28 Initial RMR Order at P 13.
29 Proposed OATT Section 38.3.1.1. In the April Order, the Commission rejected the NYISO’s
proposed 365 day notice period in light of its overall rejection of inserting the RMR process within the
Gap Solution process. April Order at P 63. The Commission did not disapprove the length of the notice
period, but directed the NYISO to submit in its compliance filing a proposed timeline that reflects the new
RMR process. Id.
30 Proposed OATT Section 38.1 (definition of “Generator Deactivation Assessment Start Date”).
31 Proposed OATT Section 38.3.1.1.
32 Proposed OATT Section 38.3.1.2.
33 Proposed OATT Section 38.3.1.2.
34 Proposed OATT Section 38.3.1.4. The NYISO will have 10 business days to determine
completeness following receipt of the initial information and, if necessary, additional information. Id.
35 Proposed OATT Section 38.3.1.5.
Honorable Kimberly D. Bose September 19, 2016
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For a Generator that enters an ICAP Ineligible Forced Outage, the Generator
Deactivation Assessment Start Date will be the date that it enters that outage status in accordance with the Generator Outage rules in Section 5.18 of the Services Tariff.38 Within twenty days of its Generator entering into an ICAP Ineligible Forced Outage, the Market Participant must
provide the cost and related information required in Appendix B to the NYISO.39
iii.Need for a 365 Day Notice Period
The 365 day notice period is the shortest period practicable for the NYISO to complete
the Generator Deactivation Process requirements, which process steps were developed to address
the directives of the Initial RMR Order and the April Order. The proposed notice period scarcely
provides the NYISO with the time necessary to evaluate the reliability impacts of a Generator
deactivation, to solicit and evaluate alternatives to an RMR Agreement that could address the
reliability need, and to select among proposed solutions to address the need. Although the
NYPSC’s role in reviewing and identifying non-generation alternatives has been removed, the
NYISO needs that time to step into this role itself and to evaluate and select from among the
available transmission and generation alternatives.40 Soliciting and evaluating proposed
solutions are time and resource intensive processes that are necessary to fulfill the Commission’s
mandate that the NYISO be responsible for the evaluation and selection of solutions.41 If the
NYISO were to use a shorter notice period, it would not have sufficient time to carefully
evaluate the information it received addressing each proposed solution.
The proposed time frames for each of the process steps in the Generator Deactivation Process were developed based on the NYISO’s long-standing experience in administering its planning and market monitoring requirements and performing related responsibilities. The NYISO has sought to streamline process steps where possible, but will still be compressing into 365 days many of the steps included in its reliability planning process, which in the normal course requires at least two years to perform.42
36 The definition of “Market Party” recognizes that multiple business entities may have
information pertinent to the NYISO’s complete review. Proposed OATT Section 38.1 (definition of “Market Party”).
37 Proposed OATT Section 38.3.1.6.
38 Proposed OATT Section 38.1 (definition of “Generator Deactivation Assessment Start Date”). Generators entering an ICAP Ineligible Forced Outage are not subject to the proposed 365 day prior
notice requirement.
39 Proposed OATT Section 38.3.2.
40 Previously, the NYISO selected only from among transmission alternatives in its reliability
planning process, and solely from among generators in its proposed RMR process. The Commission
directed the NYISO to select from among transmission and generation alternatives for the first time in this proceeding.
41 April Order at P 41.
42 OATT Section 31.1.8.2.
Honorable Kimberly D. Bose September 19, 2016
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The NYISO proposes to take up to 90 days to evaluate the reliability impacts of a
Generator’s proposed deactivation, which includes performing the required reliability studies
using power flow and resource adequacy modeling tools, coordinating with the Responsible
Transmission Owner(s), consultants, and stakeholders, and developing and reporting the study
results.43 Instead of the 30 days provided in its initial compliance filing, the NYISO will provide
60 days for eligible parties to propose Generator Deactivation Solutions.44 This 60 day period reflects a careful balance between providing for an accelerated review of proposed Generator deactivations, while allowing sufficient time for interested parties to develop and submit viable alternatives to an RMR Agreement.45
After it receives responses to its solicitation, the NYISO must evaluate the Viability and
Sufficiency46 of potential alternative Generator Deactivation Solutions. Concurrent with
soliciting alternative solutions and evaluating their Viability and Sufficiency, the NYISO will be
calculating an RMR Avoidable Cost for the Initiating Generator and determining the net present
value of Generator Deactivation Solutions that have been offered to the NYISO and determined
to be Viable and Sufficient. The remainder of the 365 day period is required for the NYISO to:
(a) make a selection among the Viable and Sufficient generation and transmission solutions that
have been presented, (b) to negotiate and enter into a Development Agreement if the NYISO
selects a transmission solution, or to negotiate and enter into an RMR Agreement if the NYISO
selects a Generator solution, or to enter into several different agreements, and (c) to file RMR
Agreements and/or Development Agreements with the Commission for its acceptance.
At the time or shortly after it issues its Generator Deactivation Assessment, the NYISO
will inform an Initiating Generator that requested permission to deactivate earlier than 365 days
whether it needs to remain available to provide service during the 365 day notice period.47 In
performing their deactivation planning, Generators should anticipate the possibility that they will
be required to remain available for the 365 day notice period. As described in Part IV.A, the
NYISO proposes to pay a deactivating Generator that requested permission to deactivate early an
avoidable cost rate as an Interim Service Provider beginning as soon as Day 181 of the 365 day
notice period.
43 The NYISO and stakeholders identified as a “lesson learned” from a prior assessment of a Generator’s proposed deactivation the importance of NYISO review of key study assumptions with stakeholders. The 90 day period takes this additional process step into account.
44 See proposed OATT Section 38.4.
45 Deactivated Generators that want to be considered as possible solutions have 10 days to submit a “statement of intent” to participate and an additional 20 days to submit or update previously submitted cost information. See proposed OATT Section 38.5.
46 The term “Viable and Sufficient” is defined in Section 38.1 of the proposed revisions to the OATT to mean the “[t]erm that describes a proposed Generator Deactivation Solution that the ISO has determined in accordance with Section 38.6 to be viable and sufficient to satisfy the identified Generator Deactivation Reliability Need individually or in conjunction with other solutions.”
47 Proposed OATT Section 38.3.6.
Honorable Kimberly D. Bose September 19, 2016
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The NYISO proposes to create an “off ramp” that would be available to Generators as
early as the conclusion of the Generator Deactivation Assessment at day 91 of the 365 day notice period, consistent with the Generator Deactivation Notice submitted to the NYISO.48 Pursuant
to this “off ramp,” the NYISO will permit early deactivation if it determines that a Generator’s
deactivation will not result in a reliability need, or if it determines that any identified need can be timely addressed without the deactivating Generator. The NYISO will notify a Market
Participant that wants to deactivate its Generator before the end of the 365 day notice period of
the date, following its completion of all required NYISO administrative processes and
procedures, when it may deactivate.49
iv.Generator Deactivation Assessment
The Initial RMR Order directed the NYISO to describe “the process for conducting the
reliability analyses necessary to determine that there is a Reliability Need for the unit.”50 Upon
the Generator Deactivation Assessment Start Date, the NYISO, in coordination with the relevant
Responsible Transmission Owner, will commence a Generator Deactivation Assessment to
determine whether a Generator Deactivation Reliability Need would result from the Generator’s
deactivation.51
The NYISO will conduct the necessary reliability studies to review the impact of the
deactivation on the reliability of the New York State Bulk Power Transmission Facilities
(“BPTFs”) following its current planning standards.52 As contemplated by the Initial RMR
Order,53 the relevant Transmission Owner(s) will conduct the necessary reliability studies to
review the impact on the reliability of the non-BPTFs that are part of the New York State
Transmission System, which studies the NYISO will review and verify.54 For this assessment,
the NYISO will review the five years period that follows the conclusion of the 365 day notice
48 Proposed OATT Section 38.3.6.
49 The deactivating Generator will be separately responsible for satisfying any state law or
regulatory requirements concerning its deactivation, including the 180-day prior notice requirements with the NYPSC (90 days for Generators between 2 and 80 MW). Proceeding on Motion of the Commission to Establish Policies and Procedures Regarding Generation Unit Retirements, Case 05-E-0889, Order Adopting Notice Requirements for Generation Unit Retirements (issued December 20, 2005).
50 Initial RMR Order at P 13.
51 Proposed OATT Section 38.3.4.1.
52 Proposed OATT Section 38.4.3.1.
53 Initial RMR Order at P 14 (“To avoid requiring NYISO to study steps necessary to ensure
reliable operation of transmission facilities over which NYISO does not have direct operational control,
we require that the NYISO Tariff indicate the entity that will conduct the study in such cases.. NYISO
may elect to allow the relevant transmission owner to conduct the necessary reliability studies. If an entity
other than NYISO is to conduct the initial reliability study, NYISO must review and verify any local or
regional reliability studies conducted, and notify stakeholders as to whether or not it agrees with the
outcome of those studies...”).
54 Proposed OATT Section 38.4.3.1.
Honorable Kimberly D. Bose September 19, 2016
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period, using the most recent base case from its reliability planning process, as updated in
accordance with the NYISO’s procedures.55 The NYISO will review whether any potential
Generator Deactivation Reliability Need can be addressed through the adoption of alternative
NYISO or Transmission Owner operating procedures or by updates to the Local Transmission Owner Plans.56 The NYISO will conduct the Generator Deactivation Assessment and post on its website the results of its analysis within 90 days of the Generator Deactivation Assessment Start Date.57 The assessment will specify whether there is a Generator Deactivation Reliability Need and whether the need can be timely addressed in the biennial reliability planning process or must be addressed in the Generator Deactivation Process.58
The NYISO is required by the Initial RMR Order to determine whether there is a
reliability impact of a Generator’s deactivation on the local, non-BPTF portion of the New York
State Transmission System. Accordingly, the NYISO will also indicate in the Generator
Deactivation Assessment if the Generator Deactivation Reliability Need is only a reliability need
on non-BPTFs, for which solely the Responsible Transmission Owner may propose a non-
generation regulated solution as an alternative to an RMR Agreement.59 Only the NYISO may
enter into an RMR Agreement with a Generator to address this local need. The local
Transmission Owner retains the right to develop projects on its system as an alternative to an
RMR Agreement to address reliability needs within its Transmission District. Unless selected by
the NYISO in its Generator Deactivation Process, such projects are not eligible for cost
allocation and cost recovery through the NYISO’s Tariffs. The costs of an RMR Agreement or a
transmission solution to a local transmission need selected by the NYISO will be allocated
through the NYISO OATT solely to the Subzones within the local Transmission Owner’s service
territory and will not be allocated regionally.60
v. Near-Term Generator Deactivation Reliability Need
The NYISO proposes to designate the Responsible Transmission Owner as the sole party
to propose a regulated solution as an alternative to an RMR Agreement when the Generator
Deactivation Reliability Need arises within three years of the conclusion of the 365 days that
follow the Generator Deactivation Assessment Start Date.61 The Commission has previously
55 Proposed OATT Section 38.4.3.1. The NYISO will review the key study assumptions with its stakeholders. Id.
56 Proposed OATT Section 38.3.4.2. As the NYISO must be the party to enter into an RMR
Agreement with a Generator, updates to the Local Transmission Owner Plans cannot include agreements with the Initiating Generator subject to the assessment or to Generators currently in a Mothball Outage, ICAP Ineligible Outage, or that have been mothballed since before May 1, 2015. Id.
57 Proposed OATT Section 38.3.4.
58 Proposed OATT Section 38.3.4.
59 Nothing in Order No. 890 or Order No. 1000 requires a competitive solicitation and selection process to address local reliability needs in a Transmission Owner’s Transmission District.
60 Proposed OATT Section 38.22.4.
61 Proposed OATT Section 38.3.5.1.
Honorable Kimberly D. Bose September 19, 2016
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permitted ISO-NE, PJM and SPP to include rules in their tariffs that allow the ISO or RTO to designate solely the local Transmission Owner as the party to develop a solution to a timesensitive need if the ISO/RTO satisfies five criteria.62
In Section 38.3.5 of its OATT, the NYISO proposes a process for identifying Near-Term Generator Deactivation Reliability Needs and designating a Responsible Transmission Owner to meet that need. The NYISO’s proposal is consistent with the five criteria that the Commission has accepted for other ISOs and RTOs.63
First, a Near-Term Generator Deactivation Reliability Need is a need that results from the deactivation of one or more Generators that the NYISO determines will arise within three years
following the conclusion of the 365 day notice period.64 This satisfies the Commission’s
criterion that requires that the solution “must be needed in three years or less to solve reliability
criteria violations.”65
Second, the NYISO will include with its posted Generator Deactivation Assessment an explanation of any Near-Term Generator Deactivation Reliability Need, including the reliability criteria violations and system conditions, in sufficient detail to allow stakeholders to understand the need and why it is time sensitive.66 This satisfies the Commission’s criterion that requires the ISO/RTO to identify and post an explanation “of the reliability violations and system
conditions in advance for which there is a time-sensitive need . . . in sufficient detail to allow stakeholders to understand the need and why it is time-sensitive.”67
Third, the NYISO will provide to stakeholders and post on its website a full and
supported written explanation of its decision to solicit solely from the Responsible Transmission Owner a regulated non-generation solution as an alternative to an RMR Agreement, which will include an explanation of the other transmission and non-transmission options considered by the NYISO, the circumstances that generated the need, and an explanation of why the need was not identified earlier.68 This satisfies the Commission’s criterion that requires:
the process that [the ISO/RTO] uses to decide whether an Immediate-need
Reliability Project is assigned to an incumbent transmission owner must be
clearly outlined in [the ISO/RTO’s] OATT and must be open, transparent, and not
62 See PJM Interconnection, L.L.C., et al., 142 FERC ¶ 61,214 (2013) at P 248 (“PJM 2013
Order”); ISO New England Inc., 143 FERC ¶ 61,150 (2013) at P 236; Southwest Power Pool, Inc., et al., 144 FERC ¶ 61,059 (2013) at P 196.
63 See id.
64 Proposed OATT Section 38.1 (definition of “Near-Term Generator Deactivation Reliability
Need”).
65 PJM 2013 Order at P 248.
66 Proposed OATT Section 38.3.5.2.1.
67 PJM 2013 Order at P 248.
68 Proposed OATT Section 38.3.5.2.2.
Honorable Kimberly D. Bose September 19, 2016
Page 19
unduly discriminatory. [The ISO/RTO] must provide to stakeholders and post on
its website a full and supported written description explaining: (1) the decision to
designate an incumbent transmission owner as the entity responsible for
construction and ownership of the project, including an explanation of other
transmission or non-transmission options that the region considered but concluded
would not sufficiently address the immediate reliability need; and (2) the
circumstances that generated the immediate reliability need and an explanation of
why that immediate reliability need was not identified earlier.69
Fourth, the NYISO will provide stakeholders with a reasonable opportunity to provide comments on the NYISO’s written explanation.70 This satisfies the Commission’s criterion that requires that “stakeholders must be permitted time to provide comments in response to the
description in criterion three and such comments must be made publicly available.”71
Finally, the NYISO will maintain and post on its website a list of all transmission
solutions that it selected in prior years to be built in response to a Near-Term Generator
Deactivation Reliability Need for which the NYISO solely designated a Responsible
Transmission Owner.72 The list will include the need, the identity of the designated Responsible
Transmission Owner, the transmission solution selected by the NYISO, its in-service date, and
date on which the transmission solution was energized or otherwise implemented.73 The NYISO
will file the list with the Commission as an informational filing in January of each year, covering
the designation of the prior calendar year, if the NYISO selected a Responsible Transmission
Owner’s regulated transmission solution to a Near-Term Generator Deactivation Reliability
Need in the prior year.74 This satisfies the Commission’s criterion that requires:
[The ISO/RTO] must maintain and post a list of prior year designations of all
projects in the limited category of transmission projects for which the incumbent
transmission owner was designated as the entity responsible for construction and
ownership of the project. The list must include the project’s need-by date and the
date the incumbent transmission owner actually energized the project. Such list
must be filed with the Commission as an informational filing in January of each
calendar year covering the designations of the prior calendar year.75
69 PJM 2013 Order at P 248.
70 Proposed OATT Section 38.3.5.2.3.
71 PJM 2013 Order at P 248.
72 Proposed OATT Section 38.3.5.3.
73 Proposed OATT Section 38.3.5.3.
74 Proposed OATT Section 38.3.5.3.
75 PJM 2013 Order at P 248.
Honorable Kimberly D. Bose September 19, 2016
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C. Solicitation of Generator Deactivation Solutions
The Initial RMR Order directed the NYISO to “describe the process NYISO will use to evaluate alternatives for addressing the identified reliability need.”76 The NYISO will solicit market-based and regulated Generator Deactivation Solutions to address a Generator
Deactivation Reliability Need. The NYISO will then evaluate the viability and sufficiency of the proposed solutions it receives. The NYISO will select a solution from among the Viable and Sufficient transmission and generation solutions it identifies.
i.Solicitation of Generator Deactivation Solutions
If the Generator Deactivation Assessment determines that a Generator Deactivation
Reliability Need exists and must be addressed in the Generator Deactivation Process, the NYISO will solicit market-based and regulated solutions to address the need.77 With the exception of Generators that are currently deactivated but eligible to return, a proposed Generator
Deactivation Solution must be submitted to the NYISO within 60 days.78 The NYISO’s
consideration of deactivated Generators is addressed in subpart iv, below.
Any Developer may propose a transmission, generation or demand response marketbased solution to address the need.79 As with its reliability planning process, the NYISO’s
Generator Deactivation Process favors market-based solutions. The NYISO will conclude the Generator Deactivation Process if there are adequate market-based solutions available to address the Generator Deactivation Reliability Need.
In response to the NYISO’s solicitation, the Responsible Transmission Owner is required to submit a proposed regulated solution that must, to the extent practicable, completely address the need.80 The Responsible Transmission Owner may propose a transmission, demand response and/or generation solution.81 However, for a generation solution only the NYISO may enter into an RMR Agreement with a Generator.82
77 Proposed OATT Section 38.4.1.
78 Proposed OATT Section 38.4.1. Consistent with its existing definition, the Gap Solution shall
also strive to be compatible with permanent solutions, which could include market-based or regulated
solutions that are identified through the normal, biennial reliability planning process. Proposed OATT
Section 38.4.4.
79 Proposed OATT Section 38.4.2.2.
80 Proposed OATT Section 38.4.2.1. The NYISO identifies the Responsible Transmission
Owner, which will normally be the Transmission Owner in whose Transmission District the NYISO
identifies the Generator Deactivation Reliability Need and/or that owns a transmission facility on which such a need arises.
81 A Responsible Transmission Owner may only recover the costs of a transmission solution under the NYISO OATT. Proposed OATT Section 38.4.2.1.
82 Proposed OATT Section 38.4.2.1.
Honorable Kimberly D. Bose September 19, 2016
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The NYISO will determine, with input from the Responsible Transmission Owner,
whether its proposed regulated solution is an interim or permanent solution.83 If it is an interim
solution, the Responsible Transmission Owner will also be required to submit a conceptual
permanent solution to the Generator Deactivation Reliability Need.84 The NYISO will use this
conceptual permanent solution solely for the purpose of identifying the term of any RMR
Agreement based on the anticipated time frame for permanently resolving the Reliability Need.
Regardless of whether its solution is ultimately selected by the NYISO, the Responsible
Transmission Owner may recover under the OATT its costs for developing its proposed
Generator Deactivation Solution and, if applicable, its conceptual permanent solution. Providing
such cost recovery is just and reasonable, as the Responsible Transmission Owner is required to
incur these costs and submit the proposed solutions in the Generator Deactivation Process.85 The
Commission previously approved recovery for Responsible Transmission Owner costs of
proposing regulated backstop solutions in the NYISO’s reliability planning process.86
Any Developer may propose a transmission solution for consideration as a regulated solution to address the Generator Deactivation Reliability Need, unless: (i) the NYISO has
designated a Responsible Transmission Owner as the sole party to propose a regulated solution to a Near-Term Generator Deactivation Reliability Need, or (ii) the reliability need arises on the local, non-BPTF portion of the New York State Transmission System.87
A Developer’s submission in response to the NYISO’s solicitation must provide the same
project information that is required in the NYISO’s reliability planning process for proposed
market-based and regulated solutions.88 Developers must also provide the information regarding
proposed Generator Deactivation Solutions that is required in Appendix B of Attachment FF.89
83 Proposed OATT Section 38.4.2.1. If the Generator Deactivation Reliability Need is only a
local need on non-BPTFs, the Responsible Transmission Owner must propose a permanent solution. Id.
84 Proposed OATT Section 38.4.2.1.
85 Proposed OATT Sections 38.23.1.
86 OATT Section 31.2.4.3.1. See New York Independent System Operator, Inc., 148 FERC ¶
61,044 at P 75 (2014); New York Independent System Operator, 143 FERC ¶ 61,059 at P 326 (2013)
(“We find that it is appropriate for the Responsible Transmission Owner to be permitted to recover costs
that it prudently incurred to meet its obligation, even when the project is not selected, since only the
Responsible Transmission Owner is required to provide the regulated backstop solution for a reliability
transmission need.”).
87 Proposed OATT Section 38.4.2.3. As stated earlier, the Commission does not require a
competitive solicitation and selection process to address local reliability needs in a Transmission Owner’s Transmission District.
88 Proposed OATT Sections 38.4.2.1, 38.4.2.2, 38.4.2.3. The project information requirements
are located in Sections 31.2.4.4.1, 31.2.4.4.2, and 31.2.6.5.1.1 of Attachment Y to the OATT (for the
Responsible Transmission Owner’s project), Section 31.2.4.6 of Attachment Y (for market-based
solutions), and Sections 31.2.4.8.1, 31.2.4.8.1, and 31.2.6.5.1.1 of Attachment Y (for alternative regulated
solutions). In Section 38.4.5, the NYISO clarifies that it may disclose the proposed Generator
Honorable Kimberly D. Bose September 19, 2016
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ii.Responsible Transmission Owner Requirements for New Transmission
Owners
To implement the requirements for a Responsible Transmission Owner that is a new
Transmission Owner in New York, the NYISO proposes conforming additions to the pro forma
operating agreement (“Operating Agreement”) to obligate a new Transmission Owner to propose
and develop a regulated solution when designated as a Responsible Transmission Owner by the
NYISO.90 In the NYISO’s September 13, 2016 Order No. 1000 compliance filing, the NYISO
proposed changes to the Operating Agreement to set forth the rights and obligations of a new
Transmission Owner in connection with providing a regulated backstop solution in the reliability
planning process under Attachment Y of the OATT.91 The proposed additions in this filing
clarify that a new Transmission Owner that executes an Operating Agreement is also required to
provide the NYISO a regulated solution in the Generator Deactivation Process when designated
as a Responsible Transmission Owner.92 Concomitantly, the tariff changes afford the new
Transmission Owner the right to recover reasonably incurred costs in accordance with Section
6.16 of the OATT (Rate Schedule 16) related to the preparation of a proposal for, and the
development, construction, operation, and maintenance, of such a regulated solution.93
iii.Study Costs
If the NYISO performs a competitive selection process among proposed regulated
transmission solutions as part of the Generator Deactivation Process, each Developer proposing a
regulated transmission solution, including an incumbent Responsible Transmission Owner, will
be responsible for the NYISO’s actual costs in evaluating its project proposal for purposes of
selection.94 With its submission of its project proposal in a competitive process, a Developer
must submit a non-refundable $10,000 application fee and a study deposit of $100,000.95 The
Deactivation Solution, except for information regarding market-based solutions and non-public financial qualification information that the NYISO would otherwise maintain as confidential under its planning
process requirements. The proposed revision also provides that the NYISO will not disclose a
Responsible Transmission Owner’s conceptual permanent solution, except for its proposed project type, general geographic location and in-service date, which are used in determining the term of any RMR
Agreement. The NYISO will not disclose other information regarding the conceptual permanent solution because the Responsible Transmission Owner, acting as a Developer, could elect to later propose it as a solution in a competitive reliability planning process.
89 Proposed OATT Section 38.4.3.
90 See OATT Section 31.11.
91 See New York Independent System Operator, Inc., Compliance Filing, Docket No. ER13-102-
011 at pp 18-22 (September 13, 2016).
92 Proposed Section 2.13(a) of the Operating Agreement.
93 Proposed Section 2.13(b) of the Operating Agreement.
94 Proposed OATT Section 38.4.6.2.
95 Proposed OATT Section 38.4.6.1.
Honorable Kimberly D. Bose September 19, 2016
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NYISO will then invoice each Developer monthly for the study costs related to the evaluation of its project.96 As with its reliability planning process and Public Policy Transmission Planning Process, it is reasonable for the NYISO to recover the costs it incurs on behalf of a Developer in evaluating its project proposal as part of a competitive process.97 The monthly invoicing
requirements, including when the NYISO may draw on the security deposit and how invoice disputes are addressed, mirror the requirements in the NYISO’s competitive planning processes that were previously accepted by the Commission.98
iv. Review of Deactivated Generator(s) that Are Eligible to Return
In addition to the Generator Deactivation Solution proposed in response to the NYISO’s
solicitation for solutions, the NYISO will review Generators that are currently deactivated, but
are eligible to return to operation, to determine whether they may be capable of satisfying the
Reliability Need in whole or in part.99 Generators subject to review include Generators currently
in a Mothball Outage, in an ICAP Ineligible Forced Outage, or that have been mothballed since
before May 1, 2015.100 If the NYISO identifies a Generator as a possible Generator Deactivation
Solution, an interested Market Participant shall inform the NYISO in writing of its intent to offer
its Generator as a Generator Deactivation Solution.101 The Market Participant must then provide
the NYISO within 20 days the information regarding its Generator that is required in Appendix
B of Attachment FF.102 Notwithstanding whether or not a Market Participant submitted a
statement of intent, the NYISO may request, at any time, that a Generator Owner submit the
information required in Appendix B, or any updates to previously submitted information within
twenty days.103 In its outage state requirements in Section 5.18 of the Services Tariff, the
NYISO proposes to make conforming revisions concerning the terminology of the new
Generator Deactivation Process and to reinstate Section 5.18.4.1.1 that was deleted in the
October 2015 Filing to address the compensation requirements for a Generator that returns to
service to address a reliability need that does not trigger the Generator Deactivation Process.
96 Proposed OATT Section 38.4.6.3.
97 OATT Sections 31.2.5.1, 31.2.6.2 (reliability planning process), 31.4.4.4 (Public Policy Transmission Planning Process).
98 Proposed OATT Sections 38.4.6.3 and 38.4.6.4.
99 Proposed OATT Section 38.5. This requirement is consistent with tariff requirements accepted by the Commission in Docket ER14-2518 with respect to Generators in a Mothball Outage or ICAP
Ineligible Forced Outage.
100 Proposed OATT Section 38.5. Generators that were mothballed prior to May 1, 2015, do not
fall within the definition of a Mothballed Generator and are separately referenced in the proposed tariff
revisions.
101 Proposed OATT Section 38.5.
102 Proposed OATT Section 38.5.
103 Proposed OATT Section 38.5.
Honorable Kimberly D. Bose September 19, 2016
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v.NYISO’s Consideration of Demand Response and Generators Located
Outside the New York Control Area as Generator Deactivation Reliability
Need solutions
The NYISO proposes to allow demand response resources to be solutions to Generator
Deactivation Reliability Needs if they are included in a Transmission Owner’s Local
Transmission Plan, are offered as a market-based solution in the NYISO’s solicitation for
solutions, or are proposed as a regulated solution by a Responsible Transmission Owner, with
regulated cost recovery, if any, occurring under state law. The NYISO does not, however,
provide for cost allocation or cost recovery for a demand response solution under its Tariffs. The
NYISO’s proposed treatment of demand response is consistent with its biennial reliability
planning process,104 and with the rules other ISOs and RTOs have implemented.105
Although the NYISO has not proposed any Tariff rules that would preclude it from
executing an RMR Agreement with a Generator located outside the NYCA as a temporary
solution to a Generator Deactivation Reliability Need, the NYISO does not have the Tariff
mechanisms and rules that would be necessary for it to evaluate, rely on, execute an RMR
Agreement with, or to compensate all of the costs that a Generator located outside the NYCA
might incur. The rules proposed in this filing would, however, allow the NYISO to select a
Generator located outside New York that is a NYCA Generator as a solution to a Generator
Deactivation Reliability Need.106 The NYISO has informed its stakeholders that if they believe
there is significant additional value to be gained by developing rules to allow Generators located
outside the NYCA to be possible solutions to a Generator Deactivation Reliability Need, then
they may prioritize this effort in the NYISO’s project prioritization process at its Budget and
Accounting Working Group. If developing improvements to enable Generators located outside
the NYCA to be RMR Generators is prioritized as a part of that process, then the NYISO will
develop enhancements to the baseline Generator Deactivation Process and Tariff rules the
NYISO submitted in this filing to explicitly address how the NYISO would consider and select
external Generators as Generator Deactivation Solutions, and the terms and conditions of service
that would apply to external Generators.
D.Information Requirements and NYISO Review
i.Cost, Revenue, and Other Information Requirements
In addition to requiring the information for the Generator Deactivation Assessment and
the information to evaluate proposed Generator Deactivation Solutions, the NYISO requires cost,
104 OATT Section 31.5.1.6.
105 See, e.g., Midcontinent Independent System Operator presentation to its Planning
Subcommittee MISO Non-Transmission Alternatives (April 19, 2016) (noting on Slide 30 “Non-
transmission alternatives are not projects and there are no plans for cost recovery of such alternatives
through the MISO tariff.”), available at: https://www.misoenergy.org/Events/Pages/PSC20160419.aspx.
106 There are currently Generators located in New Jersey that are NYCA Generators. There are Generators interconnecting in Pennsylvania that will be NYCA Generators.
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revenue, and other information from proposed and potential Generator Deactivation Solutions.
These information requirements are located in Appendix B (Section 38.25) of Attachment FF.
The Commission accepted them in its April Order.107 The NYISO has made conforming
revisions to Appendix B to be consistent with the revisions to the Generator Deactivation
Process.
The proposed tariff revisions establish the deadlines by which the required information
must be submitted. The tariff also sets a time limit for the NYISO to determine whether the
information submitted as part of a Generator Deactivation Notice meets the requirements in
Appendix B.108 It is the same period in which a Generator Deactivation Notice is determined to
be complete, i.e., within 10 days of receipt of the information or receipt of information in
response to a notice from the NYISO that the previously submitted information was not
sufficient.
ii. Review of Appendix B Cost, Revenue, and Other Information
Section 38.7, along with the requirements in Appendix B previously accepted by the
Commission, establish and describe the NYISO’s role in reviewing and verifying and/or
validating information related to an Initiating Generator and proposed Generator Deactivation
Solutions. Section 38.7.2 provides that the NYISO may reject, and require a Market Party to re-
submit or substantiate information that it determines is not adequately supported or otherwise
verifiable. Market Parties must promptly provide additional information at the NYISO’s request.
They must also make qualified representatives available to answer NYISO questions and
otherwise to facilitate the NYISO’s review. The NYISO may terminate its consideration of a
proposed Generator Deactivation Solution if a Market Party fails to provide the requested
information.
E.NYISO Evaluation of Viability and Sufficiency of Generator Deactivation
Solutions
The NYISO will evaluate all proposed Generator Deactivation Solutions to determine
whether each is Viable and Sufficient to satisfy individually or in conjunction with other
solutions the identified Generator Deactivation Reliability Need.109 The NYISO will perform
the viability and sufficiency evaluation consistent with the requirements for performing such
107 April Order at P 64. In the October 2015 Compliance Filing, these information requirements were located in Appendix F of Attachment Y.
108 Proposed OATT Section 38.3.1.5.
109 Proposed OATT Section 38.6.1. The NYISO will coordinate with the Responsible
Transmission Owner, as necessary, in performing the evaluation. Id. The NYISO will also evaluate the conceptual permanent solution proposed by the Responsible Transmission Owner to determine that it is Viable and Sufficient for purposes of the NYISO’s use of the solution as a benchmark for identifying the term of an RMR Agreement. Id.
Honorable Kimberly D. Bose September 19, 2016
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evaluation in its reliability planning process.110 If there are adequate Viable and Sufficient
market-based or demand response111 Generator Deactivation Solutions to satisfy completely the
Generator Deactivation Reliability Need, the NYISO will conclude the Generator Deactivation
Process at this point.112 In such case, the NYISO will present the results of its assessment in a
final report.113
F.Determining RMR Avoidable Costs
Compensation for RMR Generators under an Availability and Performance Rate
determined in accordance with Rate Schedule 8 of the Services Tariff is based on the Generator’s
Avoidable Costs. These costs are determined in accordance with Section 38.8 of the OATT and
Rate Schedule 8 to the Services Tariff. RMR Avoidable Costs are those costs, net of estimated
revenues (if applicable), of both the Initiating Generator and any other Viable and Sufficient
Generator Deactivation Solution that responds to the Generator Deactivation Reliability Need.114
RMR Avoidable Costs are determined, and verified, by the NYISO based on cost and revenue
information that it receives under Sections 38.3, 38.4, 38.5, 38.7, 38.8, Appendix B and the other
provisions of Attachment FF. RMR Avoidable Cost determinations are calculated for the shorter
of the Generator Deactivation Reliability Need or the period that the Initiating Generator or other
Viable and Sufficient Generator is able to address the Generator Deactivation Reliability
Need.115
Cost determinations made by the NYISO will incorporate early termination adjustments
reflected in any underlying agreement to which the Initiating Generator is a party.116 Section
38.8 also requires the NYISO to include as Capital Expenditures, in the RMR Avoidable Cost
calculation, any property or other asset acquisition costs that are necessary to permit the
Initiating Generator or other Generator Deactivation Solution to address the Generator
Deactivation Reliability Need, as long as the underlying assets have a useful life of longer than
one year.117 In calculating revenues, Section 38.8 requires the NYISO to include revenues from
any contract then in place for the Initiating Generator or other Viable and Sufficient Generator
Deactivation Solution.118 Finally, the new proposal gives the NYISO external Market
110 Proposed OATT Section 38.6.1. The viability and sufficiency evaluation requirements are located in Sections 31.2.5.3 and 31.2.5.4 of Attachment Y of the OATT.
111 The NYISO will consider demand response when it is offered as a market-based solution or
when it is proposed by the Responsible Transmission Owner as a solution that is eligible for cost recovery under New York State law.
112 Proposed OATT Section 38.6.2.
113 Proposed OATT Section 38.6.2.
114 Proposed OATT Section 38.8.1.
115 Id.
116 Proposed OATT Section 38.8.1.1.
117 Proposed OATT Section 38.8.1.3.
118 Proposed OATT Section 38.8.1.4.
Honorable Kimberly D. Bose September 19, 2016
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Monitoring Unit (“MMU”) the opportunity to provide input on the NYISO’s cost and revenue calculations in its determination of RMR Avoidable Cost.119
G.RMR Service Offers
The NYISO will solicit an RMR Service Offer from Generators that have been
determined to be a Viable and Sufficient Solution to the Generator Deactivation Reliability
Need. If the NYISO has only identified one Generator that can meet the Reliability Need, or if
all of the Generators that have been identified as Viable and Sufficient solutions are owned or
controlled by the same Generation Owner, the NYISO will provide the Generator with its RMR
Avoidable Costs, including a separate statement of the Capital Expenditures, and provide the
Generator with an opportunity to enter into the Form of Reliability Must Run Agreement.120 If
there is more than one Generator that was determined to be a Viable and Sufficient Generator
Deactivation Solution, the NYISO will solicit RMR Service Offers from each of the Generators
that responded to the NYISO’s solicitation or submitted a notice of intent to participate and
required cost information.121 Simultaneous with its request for RMR Service Offers, the NYISO will also post a notice on its website that it is soliciting such offers, which will provide further transparency to stakeholders.122
When the NYISO provides to a Generator a request for an RMR Service Offer, it must
include with that request (a) the Generator’s RMR Avoidable Costs (with a separate
identification of the Capital Expenditure amount that is included in the RMR Avoidable Costs),
(b) the duration of the period for which the NYISO determines that the Generator is Viable and
Sufficient to meet the Generator Deactivation Reliability Need, (c) the deadline by which offers
must be received, and (d) a listing of all other information that the Generator must provide in its
proposal.123 All RMR Service Offers are required to (1) state the price at which the Generator is
willing to provide the service (at either an Availability and Performance Rate or a FERC-
approved Owner Developed Rate), (2) list the timing and cost of each Capital Expenditure
included in the offer, (3) identify any changes to the Form of Reliability Must Run Agreement
that must be made to be able to provide the service, (4) identify the duration of the offer (which
cannot be for a period that is longer than the duration identified by the NYISO), (5) explain
whether the offer would change if the duration of the agreement were to be for a shorter period,
and (6) explain whether the offer is for less than or equal to the Generator’s full cost of
service.124
119 Proposed OATT Section 38.8.2.
120 Proposed OATT Section 38.9.1.
121 Id.
122 Proposed OATT Section 38.9.2.
123 Proposed OATT Section 38.9.3.
124 Proposed OATT Section 38.9.4.
Honorable Kimberly D. Bose September 19, 2016
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H.Solution Selection Process
The NYISO proposes rules to evaluate and select among Viable and Sufficient
transmission and generation solutions to address Generator Deactivation Reliability Needs that are consistent with the instructions in the Commission’s April Order. In Paragraph 73 of its April Order the Commission stated “While we emphasize that RMR agreements should only be used as a last-resort measure, we also have an interest in minimizing costs.” The NYISO’s proposed solution selection process was developed to balance the competing concerns that the Commission recognized in its order. The execution of an RMR Agreement with a Generator should be a last resort. However, the NYISO should not be required to select a transmission solution if a far less expensive Generator solution is available.
The NYISO only initiates its solution selection process if it determines that a Generator
Deactivation Reliability Need exists after it accounts for Transmission Owners’ Local
Transmission Owner Plans, operating procedures and for projects in its interconnection queue.
The first set of solutions the NYISO considers are Viable and Sufficient market-based Generator
Deactivation Solutions. Market based solutions can be generation, transmission or demand
response. Market based solutions are not eligible to recover costs that exceed market rates under
the NYISO’s tariffs. If the NYISO identifies Viable and Sufficient market based solutions that
fully address the identified Generator Deactivation Reliability Need, then it will conclude the
Generator Deactivation Process. Otherwise, Viable and Sufficient market based solutions may
reduce the scope of the need that the NYISO must select a Generator Deactivation Solution to
address.
In Section 38.10.1 of its OATT, the NYISO explains that if it expects the solution
selection process may require more than 365 days to complete, it may execute a short-term RMR Agreement with one or more Generators (most likely, with the Initiating Generator) in order to maintain reliability while it completes the solution selection process. Time concerns are most likely to arise where several Viable and Sufficient transmission solutions and several Viable and Sufficient generation solutions have all been presented for selection by the NYISO, or when several Generators provide near-simultaneous notice of their desire to deactivate.
In Section 38.10.1.1 of its proposed solution selection process, the NYISO may select a
permanent transmission solution that completely satisfies a Generator Deactivation Reliability
Need. Immediately implementing a permanent transmission solution when such a solution is
available should reduce the long-term cost to ratepayers because it avoids incurring both the cost
of implementing a temporary solution, such as an RMR Agreement, and the cost of the
permanent solution.
When a need arises on non-bulk power transmission facilities, the NYISO proposes to
select a temporary solution, if necessary, and a permanent transmission solution. The NYISO
expects that selecting a permanent transmission solution and providing cost recovery to the
Responsible Transmission Owner in this circumstance will significantly speed development of
the transmission solution and reduce the duration of any RMR Agreement that might be
necessary.
Honorable Kimberly D. Bose September 19, 2016
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In footnote 136 and Paragraph 73 of its April Order the Commission instructed the
NYISO to employ a “distinctly higher” net present value standard in its process for choosing between non-generation solutions and executing an RMR Agreement with a Generator, and to explain how the standard will be implemented. Proposed Sections 38.10.2.1 through 38.10.2.4 and Section 38.10.4 of the OATT were developed to implement the Commission’s instruction, recognizing that RMR Agreements should be a last resort.
Section 38.10.2 of the proposed solution selection rules states that the NYISO will select
a Viable and Sufficient transmission solution if there is no Viable and Sufficient generation
solution that has a “distinctly higher net present value.” Section 38.10.2.2 explains that a Viable
and Sufficient generation solution has a “distinctly” higher net present value than a Viable and
Sufficient transmission solution if, after accounting for the accuracy range of each transmission
project cost estimate and generation revenue estimate, the NYISO determines that the range of
net present values of the generation solution is higher than the range of the net present values of
the transmission solution. If there is an overlap between the ranges of net present values
between a generation solution and a transmission solution, then the generation solution does not
have a distinctly higher net present value than the transmission solution, and the NYISO will
select the Viable and Sufficient transmission solution. If there is no overlap between the ranges
of the net present values of the generation and transmission solution, and the range of net present
values of the generation solution is above those of the transmission solution, then the NYISO
will select from among the generation and transmission solutions in the manner explained below.
Consistent with the Commission’s instruction that executing an RMR Agreement should
be a last resort, the NYISO’s determination that a generation solution has a distinctly higher net
present value than a transmission solution does not require the NYISO to select the generation
solution and execute an RMR Agreement. In accordance with Section 38.10.2.4 of its proposed
rules, the NYISO next compares the Viable and Sufficient transmission solution(s) to the Viable
and Sufficient generation solution(s) based on (i) the net present value of each solution, and
(ii) the degree to which each solution satisfies the metrics proposed in Section 38.10.4.1 through
38.10.4.8 of the solution selection rules.
The metrics proposed in Section 38.10.4.1 through 38.10.4.8 of the solution selection rules were adopted from the NYISO’s biennial reliability planning process that were approved by the Commission and revised and expanded in response to stakeholder comments to better fit the Generator Deactivation Process.125 The metrics allow the NYISO to account for both cost and non-cost factors, including the impact each solution will have on the flexibility, efficiency and operation of the New York State Transmission System and the NYISO’s commitment of resources to serve load, when selecting a Generator Deactivation Solution.
125 The selection metrics in OATT Section 38.10.4 include: (i) the capital costs, (ii) cost per MW,
(iii) expandability of the proposed solution, (iv) operability of the proposed solution, (v) performance of
the proposed solution, (vi) extent to which Developer has the property rights, or ability to obtain property
rights, required to implement solution, (vii) potential issues associated with delay in constructing solution
or entering into service, and (viii) the impact on other pending reliability needs and pending solutions to
those needs.
Honorable Kimberly D. Bose September 19, 2016
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In accordance with Section 38.10.2.1, the NYISO will choose from among Viable and
Sufficient transmission solutions based on which transmission solution best satisfies the metrics
proposed in Section 38.10.4.1 through 38.10.4.8 of the solution selection process. When there is
no Viable and Sufficient transmission solution and the NYISO is selecting between the Viable
and Sufficient generation solutions, consistent with Section 38.10.3, the NYISO will choose
based primarily on which RMR Service Offer from a Generator results in the highest net present
value solution to the Generator Deactivation Reliability Need. The NYISO will also consider the
impact of any blacklined changes to the Form of Reliability Must Run Agreement that each
Viable and Sufficient generation solution submits with its RMR Service Offer. If the NYISO’s
review of the net present value of each RMR Service Offer and requested changes to the Form of
Reliability Must Run Agreement do not enable it to make a selection on those bases alone, then
the ISO will also consider the expected operational, performance and market impacts, including
the size of the offered generation solutions.
In some cases, addressing an identified Generator Deactivation Reliability Need may
require a combination of Viable and Sufficient solutions. Addressing the need might require the
NYISO to select a pair of compatible transmission solutions, or a transmission solution in
conjunction with a compatible generation solution. Proposed Section 38.10.2.3 addresses how
the NYISO will compare and select “Multi-Element Solutions.” If the NYISO must select
between one or more generation solutions that will be paired with a transmission solution, it will
use the same selection criteria as it applies in Section 38.10.3 to select the Generator. The
NYISO will compare a generation solution to a multi-element solution that includes transmission
by applying the criteria set forth in Section 38.10.2.4, which are described above.
I.Entry into RMR Agreements
Proposed Section 38.11 establishes that the NYISO may enter into an RMR Agreement with one or more Generators it selected in accordance with Section 38.10, that are capable of satisfying an identified Generator Deactivation Reliability Need, either on their own or in tandem with other Viable and Sufficient Generator Deactivation Solutions.
Under proposed Section 38.11.2, the NYISO will tender to the Owners of the selected
Generators the Form of Reliability Must Run Agreement set forth in proposed new Appendix C
to Attachment FF. The term of the agreement shall be determined by the NYISO based on in
service date of the conceptual permanent solution identified under Section 38.4.2.1. and any
modifications to the scope and timing of the originally identified Generator Deactivation
Reliability Need.
Sections 38.11.3 through 38.11.5 describe the alternative methods by which RMR
Agreements may be submitted to the Commission. Consistent with Commission precedent, the
NYISO will file an executed RMR Agreement on behalf of itself and the Generator Owner under
Section 205 of the Federal Power Act (“FPA”) if both parties agree on the terms and conditions
of the agreement, including the Availability and Performance Rate (“APR”). The NYISO will
specifically identify and explain any proposed changes to the Form of Reliability Must Run
Agreement included in such filings. If the NYISO and Generator Owner agree on all terms and
conditions (including the APR) but the Generator Owner proposes to recover Capital
Honorable Kimberly D. Bose September 19, 2016
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Expenditures above the authorized limits ($10 million if the Generator is a non-nuclear
Generator, and $25 million if it is a nuclear Generator), then the NYISO will file an unexecuted RMR Agreement, including a proposed APR, under Section 205 of the FPA, and the Owner will make a separate Section 205 filing seeking to recover its expected Capital Expenditures. If the NYISO and Owner agree on the terms and conditions of the RMR Agreement but the Owner rejects the APR, then the NYISO will file an unexecuted RMR Agreement with the Commission setting forth general terms and conditions of service that the parties have agreed to, and the
Owner will separately submit an Owner Developed Rate that is consistent with the terms and conditions of service specified in the RMR Agreement.
Section 38.11.6 proposes to include as part of the NYISO filing submitting an RMR
Agreement a description of the methodology and results of the reliability studies that the NYISO performed to identify a Generator Deactivation Need. The NYISO’s filing will describe the alternative solutions it evaluated and explain why the term of an RMR Agreement is appropriate in light of the potential alternative solutions it considered.
J.Developer’s Responsibility Following Selection of Transmission Solution
i.Responsible Transmission Owner’s Obligation to Construct
Consistent with its reliability planning process, the Responsible Transmission Owner is required to develop and construct its regulated Generator Deactivation Solution if it has been selected by the NYISO.126 The Responsible Transmission Owner will be entitled to the full recovery of all of its reasonably incurred costs related to the development, construction,
operation and maintenance of the solution.127
ii. Developer’s Responsibility to Obtain Necessary Approvals/Authorizations
Upon its selection of its transmission Generator Deactivation Solution, the NYISO will
inform the Developer that it should submit it solution to the appropriate governmental agencies
or authorities to obtain any required approvals to site, construct, and operate the solution.128 The
Developer shall do so to the extent it has not already requested or obtain the approvals.129 If the
appropriate agency or authority either rejects the required approvals or later withdraws them, the
Developer of the selected transmission solution may recover all of its necessary and reasonable
costs incurred and commitments made up to the final regulatory decision, including reasonable
and necessary expenses incurred to implement an orderly termination of the project to the extent
permitted by the Commission in accordance with its regulations on abandoned plant recovery.130
126 Proposed OATT Section 38.12.1.
127 Proposed OATT Section 38.12.1.
128 Proposed OATT Section 38.12.2.1.
129 Proposed OATT Section 38.12.2.1.
130 Proposed OATT Section 38.12.2.2.
Honorable Kimberly D. Bose September 19, 2016
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iii.Development Agreement
The NYISO proposes to require that the Developer of a transmission project selected in
the Generator Deactivation Process enter into a development agreement with the NYISO.131 The
agreement would provide for the project to be timely developed and constructed in a manner
consistent with the project proposal selected by the NYISO. The NYISO will use as the base for
this agreement the pro forma Development Agreement for reliability projects selected in its
reliability planning process that is located in Appendix C of Section 31.7 in Attachment Y of the
OATT.132
Section 38.12.3 establishes the process by which the NYISO will tender the development
agreement to the Developer and will negotiate and enter into the agreement. The proposed
process is drawn from and generally consistent with the NYISO’s process for negotiating and
entering into a development agreement in its reliability and public policy planning processes.133
However, due to the tight time frames associated with the Generator Deactivation Process, the
parties must finalize the agreement “as soon as reasonably practicable” after it is tendered by the
NYISO. In addition, as the parties will be modifying the pro forma Development Agreement
from the reliability planning process, the NYISO will always file the agreement with the
Commission for its acceptance of non-conforming changes to the pro forma agreement. Section
38.12.3 also establishes the method by which the NYISO will file either the non-conforming or an unexecuted version of the agreement with the Commission. Upon the execution or filing of an unexecuted version of the agreement, the NYISO and Developer will perform their respective obligations under the agreement that are not in dispute.
Section 38.12.4 establishes the consequences if: (i) the Developer of the selected
transmission project does not timely execute the development agreement or does not request that
it be filed unexecuted, or (ii) an effective development agreement is terminated under the terms
of the agreement. If one of these circumstances occurs and the NYISO determines that it must
identify a solution to the Generator Deactivation Reliability Need prior to the next planning cycle
of its reliability planning process, the NYISO could take one or more of the following actions.
The NYISO could address the remaining reliability need as an immediate reliability need as
described in Part III.B.i above. The NYISO could direct the Developer to continue to develop its
project for completion beyond the in-service date required to address the reliability need.
Finally, if the selected solution was proposed by a party other than the Responsible Transmission
Owner, the NYISO could request that the Responsible Transmission Owner step in to complete
it. If the Responsible Transmission Owner agreed to complete the project, the Responsible
131 Proposed OATT Section 38.12.3.
132 The Commission has accepted in large part the NYISO’s Development Agreement for its
reliability planning process, while directing certain changes. See New York Independent System
Operator, Inc., 153 FERC ¶ 61,341 at P 21 (2015). The NYISO filed compliance revisions regarding the Development Agreement that are currently pending. See New York Independent System Operator, Inc., Compliance Filing, Docket No. ER13-102-009 pp 31-40 (March 22, 2016).
133 OATT Sections 31.2.8.1.6, 31.2.8.1.7 (reliability planning process); 31.4.12.2 (Public Policy Transmission Planning Process).
Honorable Kimberly D. Bose September 19, 2016
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Transmission Owner and the original Developer would be required to work cooperatively with
each other in accordance with the requirements in Section 38.12.4.4 to implement the transition,
including negotiating in good faith with each other to transfer the project. The requirements and
restrictions concerning the project’s transfer mirror those in the NYISO’s reliability planning
process.134
K.Generator’s Failure to Deactivate
i.Deactivation Time Frame
Section 38.14.1 establishes the timeframe in which a Generator that has submitted a
Generator Deactivation Notice and has satisfied the requirements to be Retired or enter into a
Mothball Outage may take such action. Specifically, a Generator may be Retired or enter a
Mothball Outage within 365 days of: (i) the conclusion of the 365-day notice period, or (ii) the date specified in the Generator Deactivation Notice for the Generator to take such action if the
Market Participant provided greater than 365 days prior notice.135 If the Generator is not Retired or does not enter into a Mothball Outage within the allowed period then the Market Participant must submit a new Generator Deactivation Notice and satisfy anew the requirements of the
Generator Deactivation Process before its Generator may be Retired or enter into a Mothball
Outage.136 This time frame was developed to carefully balance the flexibility that a Market
Participant may want to determine the date on which it deactivates its Generator with the
NYISO’s ability to assess the impact of Generator deactivations.
ii.Study Cost Recovery
If the NYISO commences its Generator Deactivation Process in response to a Market
Participant’s submission of a Generator Deactivation Notice and: (i) the Market Participant
rescinds this notice or (ii) the Market Participant’s Generator has not Retired or entered into a
Mothball Outage within the permitted time frame described above and is not operating under an
RMR Agreement, the Market Participant must reimburse the NYISO and the Responsible
Transmission Owner(s) the actual costs that each incurred in performing their responsibilities
under the Generator Deactivation Process, including any costs associated with using
contractors.137 Requiring a Market Participant to pay study costs under these circumstances will
discourage the repeated submission of Generator Deactivation Notices to gauge the reliability
implications of the potential deactivation of a Generator. The NYISO already has a reliability
study process in place pursuant to which it will perform reliability analysis consistent with the
134 OATT Section 31.2.10.1.4.
135 Proposed OATT Section 38.14.1. As explained in Part III.B.iii of this filing letter, the NYISO may allow a Generator to deactivate at a date earlier than 365 days following a complete Generator
Deactivation Notice, but not sooner than 91 days after the Generator Deactivation Start Date, in
accordance with proposed Section 38.3.6 of its OATT.
136 Proposed OATT Section 38.14.1.
137 Proposed OATT Section 38.14.2. If the Initiating Generator is an Interim Service Provider, it may also be subject to a repayment obligation pursuant to Schedule 8 of the Services Tariff.
Honorable Kimberly D. Bose September 19, 2016
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Generator Deactivation Assessment at a Market Participant’s request and expense. In the
absence of the proposed reimbursement requirement, a Market Participant might require the
NYISO to continually perform detailed and time-consuming analysis concerning the Generator on its behalf at no cost to the Market Participant by repeatedly submitting Generator
Deactivation Notices.
L.Halting
The Gap Solution process requirements proposed in the October 2015 Filing did not
specify how the NYISO would address a non-generation solution selected to meet a reliability
need if the underlying reliability need changed or no longer existed. In response to comments in
this proceeding, the NYISO agreed that there are circumstances in which it would be reasonable
for a selected non-generation solution to continue if a Market Participant rescinded the Generator
Deactivation Notice that was the cause of the reliability need.138 In the April Order, the
Commission directed the NYISO to clarify that a non-generation solution that is substantially
complete at the time a Generator Deactivation Notice is rescinded could be completed.139 The
Commission agreed that this would “prevent waste and increase efficiency of system
planning.”140
In developing the new Generator Deactivation Process, the NYISO identified additional instances in which it may need to address whether to halt a transmission project that was selected to satisfy a Generator Deactivation Reliability Need. The NYISO, therefore, proposes the
following comprehensive halting requirements to address both the halting scenario identified by the Commission and additional circumstances.
Section 38.15 establishes the requirements by which the NYISO will determine whether or not to halt a transmission solution if the underlying reliability need has changed or no longer exists. This could occur if the Market Participant has rescinded the Generator Deactivation Notice that was the cause of the reliability need, the Generator that is the subject of the notice does not timely deactivate, or the need is otherwise addressed or eliminated.141
In such circumstances, the NYISO will not halt the selected transmission project once the
Developer has received its applicable permits or authorizations under state law.142 This approach
is consistent with the NYISO’s halting requirements for transmission projects in its reliability
planning process and reflects the substantial investment of time and resources in the NYISO’s
138 New York Independent System Operator, Inc., Request for Leave to Answer and Answer of
New York Independent System Operator, Inc., Docket No. ER16-120-000 (December 21, 2015) at p 36.
139 April Order at P 151.
140 April Order at P 151.
141 For example, a market-based solution that satisfies the reliability need may have commenced operation.
142 Proposed OATT Section 38.15.2.
Honorable Kimberly D. Bose September 19, 2016
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selection and project permitting processes.143 If permitting or regulatory approvals are not required, the NYISO will not halt a project once the Developer has commenced physical construction of its project.144
If a selected transmission project has not yet met these milestones, the NYISO will have
the discretion whether or not to halt the project.145 In making its determination, the NYISO will
consider, among other things, several factors that are guided by the concerns raised by the
Commission for preventing waste and maintaining the efficiency of system planning. The
factors include; (i) whether the developer has executed a development agreement or requested it
be filed unexecuted, (ii) the status of Developer’s progress against the milestones in the
development agreement, (iii) the status of Developer’s obtaining required permits or
authorizations, (iv) whether the project is an interim or permanent solution, and (v) the
operational and performance benefits of the project.146 If the NYISO halts the project, the
Developer will be eligible to recover the costs it incurred and the commitments made up to that
point, including the reasonable and necessary expenses incurred to implement an orderly
termination of the project.147
M. Addressing Reliability Needs on a Permanent Basis
The Initial RMR Order indicated that “RMR filings should be made only to temporarily
address the need to retain certain generation until more permanent solutions are in place... ”148
The NYISO’s proposed tariff revisions limit the need to execute RMR Agreements with
Generators by establishing a process to identify permanent solutions to address a Generator Deactivation Reliability Need.
Consistent with Section 38.10.1.1 of its proposed OATT revisions, the NYISO may select
a permanent transmission solution in the Generator Deactivation Process to address an identified
Generator Deactivation Reliability Need. If the NYISO is instead required to select an interim
solution, such as entering into one or more RMR Agreements, the NYISO’s proposed tariff
revisions will enable the NYISO to identify a permanent solution through its biennial reliability
planning process.
The initial stage of the NYISO’s biennial reliability planning process is the NYISO’s
performance of a Reliability Needs Assessment (“RNA”). This process identifies whether there
are any Reliability Needs for which the NYISO must solicit permanent market-based or
regulated solutions in the Comprehensive Reliability Plan (“CRP”). The NYISO proposes to
143 OATT Section 31.2.8.2.3.
144 OATT Section 31.2.8.2.3. Commencing physical construction includes excavation and pouring for foundations or the installation or erection of improvements. Id.
145 Proposed OATT Section 38.15.1.
146 Proposed OATT Section 38.15.1.
147 Proposed OATT Sections 38.15.1., 38.23.2. 148 Initial RMR Order at P 16.
Honorable Kimberly D. Bose September 19, 2016
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revise the requirements for the development of the base case underlying the RNA to enable the
identification of permanent solutions to a Generator Reliability Deactivation Need. If the
NYISO has selected a permanent solution in the Generator Deactivation Process, that permanent
solution will be included in the RNA Base Case so long as it satisfies the base case inclusion
rules set forth in the NYISO Procedures.149 The NYISO will not include in the RNA Base Case
an interim solution selected in the Generator Deactivation Process, or an RMR Generator
operating under an RMR Agreement.150 Because these interim projects will not be included in
the base case, the NYISO’s RNA can identify the Reliability Need underlying the need for the
interim solution as a Reliability Need for which the NYISO will solicit in its CRP market-based
and regulated permanent solutions and address that need through the biennial reliability planning
process.
IV. PROPOSED COMPLIANCE REVISIONS ADDRESSING COMPENSATION,
MARKET PARTICIPATION, “ANTI-TOGGLING” PROTECTION AND OTHER ISSUES
A. Revisions that Provide for Interim Compensation During the Second Half of
the Proposed 365 Day Generator Deactivation Notice Period
i. Justification for Compensating Generators During the Notice Period
The NYISO’s October 2015 Filing proposed that a Generator seeking to deactivate must
provide the NYISO with 365 days prior notice. Several protests argued that the 365 day notice
period was too long and should either be shortened or that the NYISO should be required to enter
into an RMR Agreement as soon as it determines that a deactivation would result in a Reliability
Need. In its December Answer to those protests, the NYISO stated that it “would not be
opposed to allowing limited cost recovery under certain circumstances during the second half of
the 365 day notice period” if necessary to ensure a just and reasonable rate.151 The NYISO
suggested that such compensation might encompass demonstrated avoidable costs, including
variable operating costs.152
The April Order rejected the 365 day notice proposal without addressing its merits and
directed the NYISO to submit a new notice timetable in this filing. In Part III.B.iii of this filing
letter, the NYISO justified its decision to re-submit a 365-day notice proposal. The NYISO is
also proposing to build on the concepts first outlined in its December Answer by establishing
interim compensation rules that would apply to “Interim Service Providers” during the second
half of the proposed 365 day period. The proposed new rules are within the scope of the April
149 OATT Section 31.2.2.3.2.
150 OATT Section 31.2.2.3.2.
151 New York Independent System Operator, Inc., Request for Leave to Answer and Answer of the New York Independent System Operator, Inc., Docket No. ER16-120-000 at 7 (December 21, 2015)
(“December Answer”).
152 December Answer at 10.
Honorable Kimberly D. Bose September 19, 2016
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Order’s broad mandate that the NYISO develop a comprehensive deactivation notice proposal and thus are appropriately included in this compliance filing.
The NYISO’s proposed rules for compensating Interim Service Providers are designed to ensure that Generators seeking to deactivate remain in roughly the same financial position that they occupy today. To date, additional payments under RMR-like agreements have generally not been available in New York until after the NYPSC’s 180 day notice requirement is satisfied. Establishing an interim compensation mechanism that would trigger on the 181st day should also eliminate any remaining concerns related to the overall justness and reasonableness of a 365 day notice period. The addition of interim compensation rules would align the NYISO’s proposal with the Commission-approved 182 day notice period under the Midcontinent Independent
Transmission System Operator, Inc.’s System Support Resource rules.153
ii. Overview of Proposed Interim Service Provider Compliance Revisions
The NYISO proposes to make interim compensation available to “Interim Service
Providers.” The NYISO’s proposed tariff revisions pertaining to the terms and conditions of
service for Interim Service Providers are modeled very closely on the language concerning RMR Generators that was accepted by the April Order. Where there are differences they are minor and are justified by valid distinctions, e.g., by the fact that Interim Service Providers will not execute RMR Agreements with the NYISO.
Section 38.1 of OATT would define an “Interim Service Provider” as “[a] Generator that must remain in service during the 365 days that follow the Generator Deactivation Assessment Start Date beyond the later of (a) the 181st day of the 365 day period, or (b) the Generator’s
requested deactivation date.” Section 38.1’s definition of “Generator Owner” would expressly include entities “that possess ultimate responsibility for the operation of an Interim Service
Provider and its participation in the ISO Administered Markets.”
Section 38.13 sets forth general rules applicable to Interim Service Providers. It also
references more detailed Interim Service Provider rules that are located elsewhere in the tariffs. Specifically:
• Sections 38.13.1 and 38.13.2 explain that if the NYISO declines to authorize an Initiating
Generator to deactivate by the later of the 181st day of the 365 day period or its requested
deactivation date then the Initiating Generator will become an Interim Service Provider.
• Section 38.13.2.1 notes that Interim Service Providers will be compensated in accordance
with Rate Schedule 8 of the Services Tariff. As is discussed in subsection “iii” below,
the Rate Schedule 8 provisions applicable to Interim Service Providers are modeled
closely on language applicable to RMR Generators that was accepted by the April Order.
In general, the NYISO proposes to pay Interim Service Providers an Availability and
153 The Midcontinent Independent System Operator, Inc.’s (“MISO’s”) tariff rules give the MISO
26 weeks (which is approximately 180 days) to identify a reliability need and develop a solution. See
MISO Open Access Transmission, Energy and Operating Reserve Markets Tariff Section 38.2.7.
Honorable Kimberly D. Bose September 19, 2016
Page 38
Performance Rate that encompasses avoidable, fixed, and variable costs, but that does not include any availability or performance incentives.
• Section 38.13.2.1.1 describes the cost, revenue and other information that the NYISO
will use to calculate the compensation to be paid under Rate Schedule 8. It also
empowers the NYISO to use estimated values when it cannot verify or validate a
submitted cost or revenue figure. This is necessary because the NYISO will only have
180 days to calculate a rate. If the Generator Owner does not promptly and diligently
respond to the NYISO’s data requests, the NYISO may be required to rely on estimates.
• Section 38.13.2.2 affirms that Generators are not eligible to be Interim Service Providers
when they are in an ICAP Ineligible Forced Outage state. Generators that are in an ICAP
Ineligible Forced Outage are not capable of operating; it would not make sense for the
NYISO to pay a Generator a cost-based rate to provide a service it is not capable of
providing.
• Section 38.13.2.3 authorizes the NYISO to allow an Interim Service Provider to
deactivate, and thus cease to be an Interim Service Provider, prior to the conclusion of the 365 day notice period after the NYISO gives sixty days’ notice. The NYISO will be able to use this rule to permit a Generator to deactivate prior to the conclusion of the 365 day period when a solution becomes available, or can be used by the NYISO to cease
compensating a Generator that is not providing adequate service.
• Section 38.13.2.4 provides that the NYISO may also allow an Interim Service Provider to
deactivate prior to the end of the 365 day notice period if it experiences a Forced Outage
of ten days or longer. The deactivation may occur only after the NYISO gives at least
thirty days’ notice that deactivation is permitted. This rule allows the NYISO to cease
paying a cost-based rate to a Generator that is not available to operate as an Interim
Service Provider.
• Section 38.13.2.5 states that Interim Service Providers must comply with applicable
Energy and Ancillary Services Market Participation Rules set forth in Section 23.6 of the
Services Tariff. As is discussed below in subsection “iv” the rules that apply to Interim
Service Providers are modeled closely on those that that April Order accepted for RMR
Generators.
• Section 38.13.2.6 specifies that Interim Service Providers that have Capacity Resource
Interconnection Rights must take all required actions to be qualified as Installed Capacity
Suppliers pursuant to Section 5.12 of the Services Tariff. Section 5.12.4 provides than an
Interim Service Provider cannot enter into any new agreements that limit its ability to
provide Energy, Capacity or Ancillary Services into the ISO Administered Markets. This
provision corresponds to revisions the NYISO proposed in October of 2015 to establish a
limitation on RMR Generators entering into new agreements. Interim Service Providers
must also comply with the capacity “must offer” requirements that the NYISO proposes
to add to Section 5.14.1.1.
Honorable Kimberly D. Bose September 19, 2016
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• Section 38.13.2.7 requires an Interim Service Provider that has deactivated but that
wishes to return to participating in any of the ISO-Administered Markets to give the
NYISO at least sixty days’ notice of its intended return so that the NYISO may calculate any repayment obligation to be imposed under Rate Schedule 8 and any credit
requirements to be applied under Sections 26.4 and 26.5 of the Services Tariff.
• Section 38.13.2.8 establishes that an Interim Service Provider that wishes to continue
participating in the ISO-Administered Markets after it ceases to be an Interim Service
Provider (and is not operating under an RMR Agreement) must give the NYISO at least
30 days’ notice of its intentions so that the NYISO may calculate any repayment obligation and applicable credit requirements as noted above.
Proposed revisions to Section 38.16 of the OATT and Rate Schedule 8 to the Services
Tariff address the recovery of “Additional Costs” by Interim Service Providers. Under the
proposed rules the NYISO may allow an Interim Service Provider to recover up to $1,000,000 in
additional costs that are necessary to address an event (a) that occurred after a Generator
Deactivation Notice was submitted, but prior to the conclusion of the 365 day notice period,
(b) that could not reasonably have been foreseen at the time the Generator Deactivation was
submitted if incurring the cost is necessary to enable the Generator to continue operating as an
Interim Service Provider. Under the proposed rules the Generator Owner would have to seek
authority to recover costs that exceed $1,000,000 from the Commission. The NYISO is required
to submit an informational filing to the Commission describing any reimbursement of Additional
Costs it allows.
Proposed revisions to Rate Schedule 8 to the Services Tariff and Sections 38.17.3,
38.17.4 and 38.17.6 of the OATT allow the NYISO to reimburse an Interim Service Provider’s
Capital Expenditure costs that are necessary to permit the Generator to provide service during the
365 day period. Similar to the treatment of Additional Costs, the NYISO can only agree to
reimburse costs of up to $1,000,000. Capital Expenditures with costs in excess of $1,000,000
must be approved by the Commission. In addition, the NYISO is not permitted to reimburse the
Generator Owner for the Capital Expenditure if the facility is not placed in service by a date that
the NYISO and the Generator Owner agree to in a written agreement (which in service date must
be prior to the conclusion of the 365 day period). The NYISO is required to submit an
informational filing to the Commission describing any reimbursement of Capital Expenditures it
allows.
iii.Rate Schedule 8: Availability and Performance Rate Payments to Interim
Service Providers
The NYISO has added proposed rules for determining Interim Service Provider
compensation to Section 15.8.6 of Rate Schedule 8 to the Services Tariff. The new provisions that would apply to Interim Service Providers are modeled closely on tariff language applicable to RMR Generators that was accepted by the April Order.
Specifically, proposed new Section 15.8.6 would direct the NYISO to compensate
Interim Service Providers using essentially the same calculations and defined variables that are
Honorable Kimberly D. Bose September 19, 2016
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used to determine an APR for RMR Generators under Section 15.8.1. As under Section 15.8.1,
Interim Service Providers will receive compensation that accounts for their avoidable costs, their
energy costs, and their supply of Voltage Support Service and Restoration (black start) Service.
The NYISO is not proposing to make performance incentive payments or availability
incentive payments to Interim Service Providers. Consistent with the explanation the NYISO
provided on pages 15-17 and 21-23 of its December Answer, the rate the NYISO proposes to pay
Interim Service Providers is appropriate because it will protect Interim Service Providers from
sustaining losses during days 181-365 of the 365 day period, but will not give Generator Owners
a financial incentive to give the NYISO the least possible amount of notice of a Generator
deactivation in order to obtain the temporary recovery of a rate that exceeds the Interim Service
Provider’s costs. Accordingly, the NYISO is not proposing to revise existing Sections 15.8.2,
15.8.3, or 15.8.4 to make them applicable to Interim Service Providers.
Section 15.8.6 would also establish that if an Interim Service Provider has a Preexisting
Capacity Bilateral then the NYISO will reduce the Interim Service Provider’s RMR Avoidable
Cost to reflect the revenues that the NYISO expects it to receive under the bilateral. If the
Interim Service Provider’s Preexisting Capacity Bilateral is with an Affiliate or was entered into
less than year before the Interim Service Provider submitted its Generator Deactivation Notice
then its RMR Avoidable Cost will be reduced by the amount that the NYISO determines that it
would be reasonably expected to have received if it had offered the capacity that is subject to the
Preexisting Capacity Bilateral into the Spot Market as a price taker for the relevant time period.
This provision is a reasonable safeguard to prevent Interim Service Providers from being over-
compensated.
iv. Section 23.6: Participation by Interim Service Providers in the NYISO-
Administered Energy and Ancillary Services Markets
Interim Service Providers’ participation in the NYISO-administered Energy and
Ancillary Services markets would be governed by revisions to Section 23.6 of the Services
Tariff. Most of the compliance tariff revisions addressing Interim Service Providers are minor
adjustments to expand rules that the April Order accepted for RMR Generators to include Interim
Service Providers or to add cross-references to other new tariff provisions.154 Like RMR
Generators, Interim Service Providers will be required to offer all of their Energy, Operating
Reserves, and Regulation into the NYISO-administered Day-Ahead and Real-Time markets.
They must generally bid in the same manner, and are subject to the same requirements and
obligations, as RMR Generators. There are also a few instances in which the NYISO is
proposing to add Interim Service Provider related language to Section 23.6 that differs slightly
from previously accepted RMR Generator language. All of these variations are limited in scope
and reflect valid differences between Interim Service Providers and RMR Generators. In most
cases, the additional rules that apply to Interim Service Providers are necessary to replace rules
that have been incorporated into the pro forma RMR Agreement. All of the proposed Interim
154 See, e.g., Sections 23.6.5.3.
Honorable Kimberly D. Bose September 19, 2016
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Service Provider related changes to Section 23.6 should therefore be accepted for the same reasons that the April Order accepted that Section as applied to RMR Generators.
For example, the NYISO is proposing to revise Section 23.6.1.1.3 to establish procedures
that will apply if a new operating constraint arises that prevents an Interim Service Provider from
offering all or a portion of its capacity via an ISO-committed flexible bid. The relevant revisions
closely track Commission-accepted language regarding the treatment of RMR Generators that
face such a constraint, but with minor adjustments to account for the fact that Interim Service
Providers will not execute RMR Agreements (except, of course, to the extent that that they later
become RMR Generators). Similarly, the NYISO has added language to Sections 23.6.1.3,
23.6.1.4, 23.6.4.2, and 23.6.4.4 addressing, respectively, Interim Service Providers’ potential
obligation to provide Voltage Support Services and restricting both their participation in Bilateral Transactions and their ability to execute or extend agreements that would impede their ability to provide Energy or Ancillary Services to the NYISO. This language differs slightly from existing Sections 23.6.1.3, 23.6.1.4, 23.6.4.1, and 23.6.4.4 concerning RMR Generators, but only to the
extent necessary to address the fact that Interim Service Providers have not executed RMR
Agreements with the NYISO.
Finally, the NYISO is proposing to add new Section 23.6.2.2 to provide more detail
concerning the determination of reference levels for Interim Service Providers. Because the
NYISO will only have 90 days advance notice that a Generator will become an Interim Service
Provider and interim service is only provided for 185 days, the NYISO will use an Interim
Service Provider’s existing cost-based reference levels, rather than performing a thorough
reference level review in conjunction with the Generator Owner and the MMU in advance (as is
done for an RMR Agreement). The Generator Owner, the NYISO or the MMU may request a
review if they do not believe the Generator’s cost-based reference levels are accurate.
v.Exclusion of Interim Service Providers’ UCAP from the Pivotal Supplier
Calculation
The October 15 Filing revised the definitions of “Affiliated Entity” and “Control” in
Section 23.2.1 of the Services Tariff to exclude an RMR Generator’s UCAP from being counted as “Mitigated UCAP.” These revisions prevented such UCAP from being subject to the
“supplier-side” “must offer” requirement applicable to Pivotal Suppliers located in Mitigated Capacity Zones.155 The revisions were accepted by the April Order.
The NYISO is now proposing conforming revisions to Section 23.2.1 to exclude Interim Service Providers’ UCAP from mitigation to the same extent as RMR Generators’ UCAP.
vi.Voltage Support Obligations
The October 2015 Filing156 included revisions to Rate Schedule 2 of the Services Tariff
regarding RMR Generators’ obligation to provide Voltage Support Service that were accepted by
155 October 2015 Filing at p 49.
156 October 2015 Filing at p 76.
Honorable Kimberly D. Bose September 19, 2016
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the April Order. The NYISO is proposing conforming revisions to Rate Schedule 2 to apply the same requirements (for the same reasons) to Interim Service Providers.
Specifically, the NYISO would add language to Section 15.2 to require an Interim
Service Provider that has provided Voltage Support Service over the last twelve months that it participated in the NYISO-administered markets to continue to provide the service unless it can demonstrate to the NYISO that it is no longer capable of doing so. This obligation is essentially identical to the one imposed on RMR Generators by Section 15.2. The October 2015 Filing explained that requiring RMR Generators to continue to provide Voltage Support Service was necessary to ensure that they continue to “provide all of the benefits they are capable of
providing to the ISO-Administered Markets during the term of their RMR Agreement.” The same rationale is equally applicable to Interim Service Providers.
Similarly, the NYISO proposes to revise Section 15.2.1 to establish that Interim Service Providers must timely perform the annual testing applicable to all Suppliers of Voltage Support Service so that they will remain continuously eligible to provide the service. If an Interim
Service Provider does not comply with the annual testing requirements then the NYISO will
make alternative arrangements to permit it to be a Qualified Supplier of Voltage Support Service. The October 2015 Filing adopted an identical rule for RMR Generators which was accepted by
the Commission in the April Order.
B. Revisions that Require RMR Generators and Interim Service Providers to
Offer Capacity as “Price-Takers” and that Address the Application of Offer Floors Under the Buyer-Side Market Power Mitigation Measures
The October 2015 Filing proposed to require RMR Generators to offer all of their UCAP
into the NYISO-administered capacity auctions as “price-takers,” i.e., at $0.00/kW month with
certain limited exceptions. The April Order rejected each of the proposed exceptions that would
allow the NYISO “to impose a capacity offer price on RMR generators higher than $0.00/kW-
month.... ”157 It stated that it would be “more efficient” for all RMR Generators to offer as
price-takers and expressed concern that the proposed exceptions could result in ratepayers
“paying twice.”158 The Commission also emphasized that RMR Generators should not be
subject to offer floor mitigation under the NYISO’s “buyer-side” capacity market power
mitigation rules.159
The NYISO sought rehearing, and in the alternative clarification,160 of the Commission’s
determination with respect to RMR Agreements that addressed a resource adequacy need. The
NYISO argued that it would be inefficient to require RMR Generators that were retained to
157 April Order at P 82.
158 Id.
159 Id. at P 83.
160 See NYISO Rehearing Request at pp 4-10.
Honorable Kimberly D. Bose September 19, 2016
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address such a need to offer as price takers. The NYISO’s request for rehearing is still pending before the Commission.161
Consequently, in accordance with the April Order, the NYISO is proposing compliance
revisions to specify that all RMR Generators and Interim Service Providers must offer into the
capacity market as price-takers, i.e., at $0.00/kW-month. Section 5.14.1.1 would establish the
must-offer and price taker requirements for Interim Service Providers but allow an exception to
the extent that the generator is subject to a “Pre-Existing Capacity Bilateral”162 that precludes it
from offering all or a portion of its capacity into an ICAP Spot Market Auction. This exception
is necessary to avoid abrogating existing contracts in the absence of an express Commission
directive to do so and is consistent with similar language that the April 16 Order accepted for
RMR Generators.163 The must offer and price taker requirements for RMR Generators would be set forth in Section 3.7.2 of the Form of Reliability Must Run Agreement. Similar must-offer and price taker language applicable to both ISP UCAP MW and RMR Generators would also be
added to Section 23.4.5.8 of the Services Tariff.
In addition, the NYISO is revising Sections 23.4.5.7.12 and 23.4.5.8 to specify that RMR
Generator or Interim Service Provider UCAP that is subject to an Offer Floor shall always be
offered at $0.00/kW-month.164 Correspondingly, the NYISO is proposing a conforming
revision to Section 23.4.5.7.11 to specify that if UCAP MW are Mitigated UCAP (i.e., subject to
a Pivotal Supplier offer cap) and also subject to a buyer-side mitigation Offer Floor, the UCAP
MW shall be offered in accordance with Section 23.4.5.7.12 (i.e., at $0.00/kW-month).
Similarly, Section 23.4.5.7 would be revised to state that ISP UCAP MW and the UCAP of RMR Generators will not be required to offer capacity at the Offer Floor level that would normally apply and that Offer Floors shall “cease to apply” for periods when an Installed
Capacity Supplier is an RMR Generator.
Finally, the NYISO is proposing to revise Section 23.4.5.7 of the Services Tariff to
clarify that when ISP UCAP MW from an Interim Service Provider or UCAP from an RMR
Generator that are subject to a buyer-side mitigation Offer Floor clears in an ICAP Spot Market
Auction will not be counted for purposes of determining what constitutes “Cleared UCAP.”
Section 23.4.5.7 establishes that Offer Floor mitigation shall continue to apply to UCAP until it
has cleared for any twelve, not necessarily consecutive, months. The purpose of this requirement
161 The NYISO’s submission of compliance tariff revisions in accordance with the April Order is not intended to, and should not be construed as, a withdrawal or waiver of any argument raised in the NYISO Rehearing Request.
162 The revision to Section 5.14.1.1 proposed in this filing would define a “Preexisting Capacity Bilateral” as a “bilateral contract that is effective at the time of the ICAP Spot Market Auction and was executed and effective before the NYISO received a Generator Deactivation Notice ”
163 Section 3.7.2 (Alternate Language) of the Form of Reliability Must Run Agreement in OATT Section 38.26.
164 Sections 23.4.5.7(ii) and 23.4.5.7.1 of the Services Tariff specifies that UCAP subject to an Offer Floor can only be offered into an ICAP Spot Market Auction.
Honorable Kimberly D. Bose September 19, 2016
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is to permit Offer Floor mitigation to end only when capacity has proven to be economic and thus becomes “Cleared UCAP.”165 Thus, the NYISO’s proposed clarification is necessary
because allowing UCAP that cleared an auction solely because it was being offered by an RMR Generator or was ISP UCAP MW at $0.00/kW-month in accordance with the RMR or Interim Service Provider rules would not be appropriate. Such UCAP would not have been
demonstrated to be economic for that month and thus counting it as “Cleared UCAP” could
result in mitigation ending prematurely.
C.Revisions to Establish Additional “Anti-Toggling” Measures and to Govern
Repayment Periods
The April Order rejected, in part, the October 2015 Filing’s proposed rules to
disincentivize toggling between cost-based and market-based compensation. The Commission
was concerned that the NYISO’s proposed “claw-back” provision did not adequately prevent a
Generator from noticing an intent to deactivate in order to temporarily obtain cost-based
compensation in excess of its expected market compensation without having to refund the above-
market payments.
The April Order therefore required the NYISO to revise its tariff to “provide that where
an RMR generator wishes to continue to operate at the end of its RMR agreement, it must repay
NYISO the higher of: (1) the capital expenditures less depreciation, that NYISO reimbursed the
RMR generator to enable it to remain in service during the term of the RMR agreement; or
(2) the above-market payments the RMR generator received during the term of the RMR
agreement.”166 The above-market payments “would be the difference between the total marketbased revenues, including uplift revenues, the generator would have received during the term of the RMR agreement, and the revenues received pursuant to the RMR agreement.”
The April Order specified further that the NYISO should “propose a process to allow the
RMR generator to return to the NYISO-administered markets immediately upon termination of
the RMR agreement, while repaying NYISO any applicable capital expenditures . . . or above-
market payments, both with interest, . . . on a pro-rata monthly basis.” (footnotes omitted).167
Repayments would “continue until all applicable capital expenditures or above-market payments
are fully repaid, provided the now-former RMR generator continues to operate in the NYISO-
administered markets.” The Commission explained that “[r]equiring reimbursement of all
capital expenditures before participating in the markets could discourage an otherwise efficient
generator from continuing to operate to the detriment of customers.”168 It believed that its “pro-
rata payment alternative balances these concerns by ensuring the repayment of capital
165 See New York Independent System Operator, Inc., 133 FERC ¶ 61,178 (2010) at 47-52. 166 April Order at P 126.
167 In the December Answer, the NYISO had agreed that Section 15.8.6 should be clarified to
specify that Capital Expenditure costs must be repaid with interest. See December Answer at 50.
168 See April Order at P 127.
Honorable Kimberly D. Bose September 19, 2016
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expenditures, while also ensuring that customers have the opportunity to receive the full value of service from upgrades for which they have paid.”169
The NYISO sought rehearing, arguing that protections that were already included in its
RMR rules made an additional claw-back measure unnecessary and that the specific additional
measure adopted by the Commission could be unduly punitive and create other unintended
problems.170 To the extent that the Commission continued to believe that an additional anti-
toggling measure was necessary, the NYISO asked that it be permitted to work with stakeholders
to develop an alternative to the one imposed by the April Order. The NYISO’s request for
rehearing is still pending before the Commission. Accordingly, the NYISO is now proposing
anti-toggling tariff revisions that implement the April Order’s compliance directives
notwithstanding the concerns expressed in the NYISO Rehearing Request.171
Specifically, the NYISO proposes to revise Rate Schedule 8 to its Services Tariff to
enhance the October 2015 Filing’s language that would have compelled former RMR Generators to pay back Capital Expenditures, minus depreciation, prior to returning to the NYISO-
administered markets. Under a revised Section 15.8.7,172 former RMR Generators and former Interim Service Providers would be required to make monthly payments in order to pay back the higher of Capital Expenditures minus depreciation or Above Market Revenues. Consistent with the April Order, interest would be applied to the value of both Capital Expenditures and Above Market Revenues prior to determining which was greater.
Proposed Section 15.8.7 of Rate Schedule 8 to the Market Services Tariff requires
Generator to make repayments to the NYISO if the NYISO: (i) reimbursed all or a portion of the
cost of a Capital Expenditure that was necessary to permit a Generator to provide service during
the term of an RMR Agreement or while it was an Interim Service Provider or; (ii) compensated
an RMR Generator or Interim Service Provider under Rate Schedule 8 in excess of what it would
have received if it had participated normally in the markets, including the NYISO’s
reimbursement of Capital Expenditures. The Generator would be required to repay the NYISO
the higher of the value calculated under Section 15.8.7.1, regarding the recovery of capital
expenditures from former RMR Generators and former Interim Service Providers, and Section
15.8.7.2, regarding the recovery of Above Market Revenues from former RMR Generators and former Interim Service Providers. Section 15.8.7 also establishes that the higher of the two
repayment obligations, divided by the applicable number of repayment periods, is the “Monthly Repayment Obligation.”
169 Id.
170 NYISO Rehearing Request at pp 11-14.
171 The NYISO’s submission of compliance tariff revisions in accordance with the April Order is not intended to, and should not be construed as, a withdrawal or waiver of any argument raised in the NYISO Rehearing Request.
172 This provision was previously Section 15.8.6.
Honorable Kimberly D. Bose September 19, 2016
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The calculation that would be conducted under Section 15.8.7.1 is essentially the same calculation that the April Order approved for determining reimbursable Capital Expenditure costs. The NYISO is proposing a new formula to govern the calculation of Above Market Revenue repayment obligations in Section 15.8.7.2.
As required by the April Order, the values calculated under both Sections 15.8.7.1 and
15.8.7.2 will be adjusted to reflect accumulated interest computed on a quarterly basis and
assessed based on the dates payments were made by the NYISO. Once a Generator has returned to the NYISO-administered markets a fixed interest rate will be used in the NYISO’s
determination of the Generator’s Monthly Repayment Obligation.
In addition, the NYISO proposes to comply with the April Order’s mandate that it permit former RMR Generators to repay their claw-back obligations over time by modifying the
formula it uses to calculate the claw-back obligation for Capital Expenditures in Section
15.8.7.1, adding new Section 15.8.7.1.1 that is used to determine the term over which Capital
Expenditures must be repaid, and by making additional revisions to Section 15.8.7.2. Proposed
Section 15.8.7.1.1 would set the “Recovery Term” for repayments calculated under Section
15.8.7.1 as the shorter of: (i) the major maintenance cycle in total years of the Generator; or
(ii) the Average Remaining Life of the cumulative Capital Expenditures paid by the NYISO over
the term of the RMR Agreement. The NYISO selected these repayment periods because a
competitive entity participating in the ISO markets that intends to continue its participation
should have the capability to accrue or finance the funds necessary to timely repair and/or
replace Capital Expenditures that are necessary for the operation of a Generator. The proposed
Recovery Term is aligned with the average amount of time over which such expenditures would
be expected to be incurred. The proposed duration of the Recovery Term attempts to achieve a
delicate balance. If it is too short, it may preclude a former RMR Generator or former Interim
Service Provider from returning to the market, even though it should. If the Recovery Term is
too long, then it will be difficult for RMR loads to recuperate the monies paid to reimburse RMR
Generators and Interim Service Providers for Capital Expenditures, potentially resulting in a
subsidy to the Generator.
The Recovery Term for repayments calculated under Section 15.8.7.2, with respect to any Capital Expenditure component of Above Market Revenues shall be the same as would be
computed under Section 15.8.7.1.1. The portion of the Section 15.8.7.2 repayment obligation
that is attributable to repaying the “Other [above market] Revenues” portion of the formula
would be recovered over the shorter of 36 months or twice the duration of any applicable RMR Agreement. The proposed recovery period is based on a stakeholder proposal that was near-
universally supported by the NYISO’s stakeholders as an appropriate compromise between the
Commission’s instruction that the NYISO must allow repayment over time and the desire to
reimburse RMR Loads as quickly as possible.
The NYISO is proposing revisions to Section 6.14.6 of Rate Schedule 14 to its OATT to
ensure that any reimbursements received from Interim Service Providers are repaid to the
appropriate RMR Loads. This allocation will be conducted based on the same principles and
using the same mathematical formulae that the April Order accepted for capital expenditure
repayments by RMR Generators. The NYISO’s proposed revisions are limited to: (i) amending
Honorable Kimberly D. Bose September 19, 2016
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existing provisions so that they will apply to both RMR Generators and Interim Service
Providers; (ii) changing language that previously referred only to “Capital Expenditure Costs” to refer to “Monthly Repayment Credits” that reflect the broader scope of anti-toggling measures required by the April Order; (iii) adding a new section 6.14.3.5 to govern the calculation of the “RMR Charge” variable for Interim Service Providers; and (iv) making certain additional
ministerial corrections and updates to tariff cross-references.
D.RMR Credit Rules
Because the NYISO is permitting former RMR Generators and former Interim Service Providers to repay their claw-back obligations over time, the NYISO has developed new credit rules to ensure that the NYISO is able to recover these repayment obligations from former RMR Generators and former Interim Service Providers.
The NYISO proposes to add a new Services Tariff Section 26.4.2.10 to establish a credit
requirement that will apply to a Market Participant that returns a former RMR Generator or
former RMR Interim Service Provider to the ISO-Administered Markets while the Generator is
subject to a Monthly Repayment Obligation. The purpose of the credit requirement is to mitigate
the risk of a bad debt loss that could result if the market participant defaulted on its Monthly
Repayment Obligation.
The proposed credit requirement is eight times the Monthly Repayment Obligation
associated with the former RMR Generator or former Interim Service Provider. Eight months is
the maximum amount of exposure that a Market Participant could have at any given time for a
Monthly Repayment Obligation for a Generator. If less than eight months are remaining in the
repayment term for the Monthly Repayment Obligation associated with the former RMR
Generator or former Interim Service Provider, then the NYISO will reduce the credit requirement
accordingly.
The NYISO also proposes to modify Services Tariff Section 26.5 to indicate that a
Market Participant may not use unsecured credit to satisfy this credit requirement. A Market Participant subject to this credit requirement must provide collateral to satisfy the repayment requirement.
E.MMU Responsibilities
Order No. 719,173 requires all tariff revisions describing the MMU’s RMR-related
functions to be incorporated into Attachment O to the Services Tariff, (which is the NYISO’s
“Market Monitoring Plan”), in addition to appearing in other relevant portions of the tariffs.
Accordingly, as it did in the October 2015 Filing,174 the NYISO is proposing to revise
Attachment O of the Services Tariff to delineate all new MMU responsibilities added by this
173 See Wholesale Competition in Regions with Organized Electric Markets, Order No.719, 125 FERC ¶ 61,071 (2008).
174 See October 2015 Filing at 71-72.
Honorable Kimberly D. Bose September 19, 2016
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compliance filing. The NYISO proposes to revise Section 30.4.6.8.6 of Attachment O to
conform the MMU responsibilities in Attachment O of the Services Tariff to those set forth in
the Generator Deactivation Plan in Attachment FF of the OATT. These include that the NYISO
will seek comments from the MMU: (i) on matters relating to the inputs and calculations
performed by the NYISO in determining RMR Avoidable Costs in Section 38.8 of the OATT
and (ii) on its review of Proposed Additional Costs and its determinations of Substantiated
Additional Costs under Section 38.16 of the OATT. The NYISO also proposes revisions to
Section 30.4.6.2.13 of Attachment O to modify the description of the MMU responsibilities
concerning Energy and Ancillary Service market participation rules. The revisions address the
addition or modification of these rules, so that they apply to Interim Service Providers as well as
RMR Generators.
V. FORM OF RELIABILITY MUST RUN AGREEMENT
In paragraphs 139-140 of its April Order the Commission accepted the NYISO’s pro
forma RMR Agreement for filing without modification. In this filing the NYISO proposes to
relocate the pro forma RMR Agreement from Section 31.10 of the OATT to Section 38.26 of the OATT as part of its effort to distinguish the generator deactivation rules from the gap solution rules. In addition to moving the pro forma RMR Agreement to a different location in its Tariffs, the NYISO proposes the following changes to the pro forma RMR Agreement to comply with requirements of the April Order:
1. The NYISO proposes to add a new defined term “365 Day Notice Period.”
2. The NYISO proposes to revise sections 2.2.6.1, 2.2.9, 3.3.7, 4.1 and 4.3.4 of the pro
forma RMR Agreement to implement the instruction in paragraphs 126-127 of the April Order that the reimbursement of Capital Expenditures and above market revenues can occur over time.
3. The NYISO proposes to revise Sections 2.2.6 through 2.2.9 and 4.3.4 of the pro forma
RMR Agreement to incorporate by reference the new credit rules that will apply to
former RMR Generators that elect to continue participating in the ISO Administered
Markets following the conclusion of their RMR Agreement, or that deactivate and later
return to participating in the ISO Administered Markets while they are eligible to receive
market-based rates. The proposed credit rules are necessary to protect loads while former
RMR Generators repay Capital Expenditures and above market revenues over time.
4. The NYISO proposes to revise sections 2.2.6.1, 2.2.9, 3.3.7, 4.1 and 4.3.4 of the pro
forma RMR Agreement to implement the instruction in paragraphs 123-126 of the April
Order that the NYISO must require former RMR Generators to repay to the NYISO the
higher of (1) the capital expenditures, less depreciation, that the NYISO reimbursed the
RMR Generator to enable it to remain in service during the term of the RMR Agreement;
or (2) the above-market payments the RMR Generator received during the term of the
RMR Agreement.
Honorable Kimberly D. Bose September 19, 2016
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5. The NYISO proposes to revise section 3.7.2 of the pro forma RMR Agreement to
implement the instruction in paragraphs 82-83 of the April Order that imposing a
capacity offer price on RMR Generators higher than $0.00/kW-month would be unjust and unreasonable.
In addition to the changes described above, the NYISO proposes ministerial changes to
the pro forma RMR Agreement that include updated cross-references to the NYISO’s Tariffs.
VI.COST ALLOCATION AND COST RECOVERY
A.Generator Deactivation Process Cost Allocation Methodology
Consistent with the Commission’s directives in the April Order, the NYISO proposes a
cost allocation methodology that is completely separate from its Order No. 1000 cost allocation
methodology. At the same time, the NYISO’s proposed cost allocation mechanism for
Generator Deactivation Solutions is similar to the NYISO cost allocation mechanism that the
Commission accepted in the Order No. 1000 context.175 Under the proposed cost allocation
mechanism, the NYISO proposes to use a “needs-based” methodology to allocate the costs of a
Generator Deactivation Solution to those LSEs in New York that contribute to the Reliability
Need and primarily benefit from the solution to that need. Furthermore, like the Order No. 1000
cost allocation methodology recently approved by the Commission, the NYISO proposes to
allocate costs based on five different types of reliability issues - resource adequacy , BPTF
thermal transmission security, BPTF voltage security, local transmission security, dynamic
stability, and short circuit.
In particular, the NYISO’s proposed methodology will allocate costs associated with: (i)
a Responsible Transmission Owner’s proposed transmission Generator Deactivation Solution
and, if applicable, its conceptual permanent transmission Generator Deactivation Solution, (ii) a
Developer’s transmission Generator Deactivation Solution selected by the NYISO to address the
Generator Deactivation Reliability Need, or (iii) a Generator operating under an RMR
Agreement to address a Generator Deactivation Reliability Need. The NYISO will perform the
steps to resolve the different types of reliability issues based on the following hierarchy: (i)
resource adequacy, (ii) BPTF thermal transmission security, (iii) BPTF voltage security, (iv)
local transmission security, (v) dynamic stability, and (vi) short circuit.176 The NYISO will
proceed through this hierarchy until all of the costs of the solution have been addressed. The
NYISO developed this hierarchy to reflect the level of importance of the reliability issue
underlying each of these steps in relation to maintaining system reliability.
The NYISO’s methodology is consistent with traditional electric system planning
practice, which begins by providing for resource adequacy with the design and siting of supply
resources to provide sufficient resources to service load. This is followed by providing that the
175 New York Independent System Operator, Inc., Letter Order, Docket No. ER16-1968-000 (August 12, 2016).
176 Proposed OATT Section 38.22.
Honorable Kimberly D. Bose September 19, 2016
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transmission system can accommodate the delivery of power from these supply resources to
loads without creating thermal overloads and ensuring that there is sufficient voltage support to accommodate transmission. Local thermal and voltage transmission issues must then be
addressed. Next, the methodology provides for maintaining dynamic system stability on the BPTF. Finally, solutions to exceeding fault current ratings of circuit breakers will be treated as a local matter without cost allocation through the NYISO’s tariff.
1. Resource Adequacy Cost Allocation Step
The first step of the cost allocation mechanism is the allocation of that portion of the
costs of the solution attributable to resolving resource adequacy.177 This aspect of the cost
allocation mechanism is comprised of a three-step approach that focuses on whether there is a
locational, statewide, or a bounded region Reliability Need arising from a resource adequacy
issue.
Step one focuses on those areas within the New York Control Area (“NYCA”) that have
Locational Minimum Installed Capacity Requirements (“LCRs”) (i.e., Load Zones J, K, and G
through J), which are referred to herein as “LCR Zones.” To the extent that these LCRs have
resource adequacy deficiencies addressed by the Generator Deactivation Solution (deficiencies
defined as having a Loss of Load Expectation (“LOLE”) in the NYCA above 0.1 days per year),
then the resource adequacy costs associated with the Generator Deactivation Solution are
allocated first to those LCRs. Step two applies if the Generator Deactivation Solution addresses resource adequacy deficiencies in the unconstrained NYCA region. If so, then the portion of the resource adequacy costs of the Generator Deactivation Solution needed to address the NYCA resource adequacy deficiencies will be allocated to all Load Zones based on their coincident peak load contribution. If the reliability simulation shows that there are still resource adequacy issues after steps one and two are applied, step three requires the NYISO to apply a binding interface test. Any Bounded Regions identified under the application of this test are then allocated any remaining resource adequacy costs of the Generator Deactivation Solution.
2. BPTF Transmission Security Cost Allocation Step
If, after addressing any resource adequacy issues, there remains a BPTF transmission
security issue that is addressed by the Generator Deactivation Solution, the NYISO will allocate
the costs of addressing the transmission security issue by first allocating the costs for the portion
of the solution attributable to a thermal transmission security issue on the BPTFs, and then
allocating the costs for the portion attributable to a voltage security issue on the BPTFs.
a. BPTF Thermal Transmission Security Cost Allocation Step
For the portion of a Generator Deactivation Solution attributable to the resolution of a
BPTF thermal transmission security issue, the NYISO will allocate the cost of the solution to
those Subzones that contribute to a thermal overload on the BPTFs based on the relative
contribution of the Load in each Subzone to the transmission security issue as described below.
177 Proposed OATT Section 38.22.1.
Honorable Kimberly D. Bose September 19, 2016
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The use of a Subzone evaluation methodology is consistent with the operation and market design of the NYISO’s system and is the most granular level at which the NYISO’s billing and
settlement system can allocate the costs to LSEs.
The NYISO will perform the BPTF thermal transmission security step using the same
system modeling that is used under Attachment Y in identifying Reliability Needs necessitating
the solution to be cost allocated. The NYISO will first identify for each load bus in a Subzone a
“nodal distribution factor” and “nodal megawatt flow.” The “nodal distribution factor”
represents the percentage of a Load that flows across the facility subject to the Reliability
Need.178 The sign (positive or negative) of the nodal distribution factor represents the direction
of the flow.179 The “nodal megawatt flow” represents the number of megawatts that flow across
the facility subject to the thermal transmission security-related Generator Deactivation
Reliability Need due to the Load.180 It is calculated by multiplying the amount of Load in
megawatts for the bus (the “Nodal Load”) by the nodal distribution factor (positive or negative)
for the bus.181
Based on these determinations, the NYISO will identify which Loads contribute to the
overloading of the facility and which help to resolve the overloading of the facility. The Nodal
Load for a load bus with a positive nodal distribution factor contributes to the overloading
facility and is referred to as a “contributing Load.”182 The nodal megawatt flow for this Load is
referred to as “contributing flow.”183 The Nodal Load for a load bus with a negative nodal
distribution factor helps to resolve the overloading of the facility and is referred to as a “helping
Load.”184 The nodal megawatt flow for this Load is referred to as “helping flow.”185
The NYISO will then determine which of the contributing Loads and helping Loads have
a material impact on the thermal transmission security-related Generator Deactivation Reliability
Need. The NYISO will first calculate the “contributing materiality threshold,” which represents
the percentage of all contributing Load that flows across the overloaded facility.186 This is
calculated by dividing the sum of all contributing flow by the sum of all contributing Load.187
The NYISO will similarly calculate the “helping materiality threshold,” which represents the
178 Proposed OATT Section 38.22.2.1.
179 Proposed OATT Section 38.22.2.1.
180 Proposed OATT Section 38.22.2.2.
181 Proposed OATT Section 38.22.2.2.
182 Proposed OATT Section 38.22.2.3.
183 Proposed OATT Section 38.22.2.3.
184 Proposed OATT Section 38.22.2.4.
185 Proposed OATT Section 38.22.2.4.
186 Proposed OATT Section 38.22.2.3.
187 Proposed OATT Section 38.22.2.3.
Honorable Kimberly D. Bose September 19, 2016
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percentage of all helping Load that flows across the overloaded element.188 This is calculated by dividing the sum of all helping flow by the sum of all helping Load.189 For each load bus, the
nodal megawatt flow will be considered material if the nodal distribution factor is: (i) greater
than or equal to the contributing materiality threshold, or (ii) less than or equal to the helping
materiality threshold.190
The NYISO will calculate the net material flow for each Subzone as the sum of the
material Subzone contributing flow and material Subzone helping flow for that Subzone.191
Based on the net material flow, the NYISO will calculate the allocated flow for each Subzone.192
If the net material Subzone flow for a Subzone is positive, the allocated flow is equal to the net
material Subzone flow. If the net material Subzone flow for a Subzone is negative or zero, the
allocated flow for that Subzone is zero. That is, based on the net material flow, a Subzone that is
contributing to the overload will be allocated costs for the solution to the Reliability Need,
whereas a Subzone that is helping to alleviate the overload will not be allocated costs.
The NYISO will then check the reasonableness of the resulting allocation to verify that
sufficient contributing flow is being allocated costs. If the total allocated flow is less than a
majority of the total contributing flow, represented as 60%, then the contributing materiality
threshold will be reduced until the total allocated flow is at least 60% of the total contributing
flow.193
Finally, the NYISO calculates the allocation percentage for each Subzone by dividing the total allocated flow for each Subzone by the total of all allocated flow in the NYCA.194
If a single solution addresses multiple BPTF thermal transmission security issues, the NYISO will calculate weighting factors based on the ratio of the present value of the estimated costs for individual solutions to the costs of resolving each BPTF thermal transmission security issue.195 The NYISO will apply the weighting factors to the cost allocation calculated for each Subzone for each individual BPTF thermal transmission security issue.196
The NYISO will exclude a Subzone from cost allocation if it does not exceed a threshold
de minimis impact from the Subzone. If a Subzone is assigned a BPTF thermal transmission
security cost allocation less than a de minimis dollar threshold, that Subzone will not be allocated
188 Proposed OATT Section 38.22.2.4.
189 Proposed OATT Section 38.22.2.4.
190 Proposed OATT Section 38.22.2.5.
191Proposed OATT Section 38.22.2.5.
192Proposed OATT Section 38.22.2.6.
193 Proposed OATT Section 38.22.2.6.
194 Proposed OATT Section 38.22.2.7.
195 Proposed OATT Section 38.22.2.8.
196 Proposed OATT Section 38.22.2.8.
Honorable Kimberly D. Bose September 19, 2016
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costs. However, the total de minimis Subzones may not exceed 10% of the total BPTF thermal transmission security cost allocation.197 The de minimis dollar threshold would be reduced until the total de minimis Subzones do not exceed 10% of the total BPTF thermal transmission
security cost allocation. The de minimis threshold is initially $10,000.
i.BPTF Voltage Security Cost Allocation Step
If, after addressing any resource adequacy or BPTF thermal transmission security issues, there remains a BPTF voltage security issue, the NYISO will allocate the costs of addressing the voltage security issue on a Load-ratio share to each Subzone to which the substation subject to the violation is connected as determined based on the total peak Load for that Subzone.198
Transmission system voltage issues are inherently local in nature. It is, therefore, reasonable to allocate the costs of resolving these issues at the Subzone level, which is the lowest level of granularity at which the NYISO can allocate these costs.
3. Local Transmission Security Cost Allocation Step
The initial three cost-allocation steps, for resource adequacy, BPTF thermal transmission
security, and BPTF transmission voltage security, all involve addressing issues on BPTFs. The
RMR Order, however, requires that the NYISO administer all RMR Agreements needed to
address Generator Deactivation Reliability Needs in the NYCA, including those Generator
Deactivation Reliability Needs that arise on the New York Transmission Owners’ local, non-
BPTF transmission systems.199 In compliance with the RMR Order, the NYISO proposes this
local transmission security cost allocation step to allocate the costs under its OATT of a
Generator Deactivation Solution that is required to address a non-BPTF thermal or voltage
transmission security issue.200
If there are non-BPTF thermal overloads remaining after the NYISO has addressed the BPTF transmission security issues, the NYISO will allocate the costs of addressing these
overloads to the Subzone in which the receiving terminal of the overloaded non-BPTF facility is assigned. If a solution addresses multiple non-BPTF overloads in multiple Subzones, the
NYISO will allocate the costs of addressing these overloads on a Load-ratio share basis to each identified Subzone. Finally, if there are any remaining non-BPTF voltage violations, the NYISO will allocate the costs necessary to resolve these violations on a Load-ratio share basis to each Subzone to which the substation subject to the violation is connected.
The non-BPTF facilities are local in nature and used to secure local Load. Thermal
overloads on non-BPTF facilities are primarily driven by the megawatt draw to serve local Load,
197 Proposed OATT Section 38.22.2.9. If the total allocation percentage of all de minimis
Subzones is greater than 10%, then the de minimis threshold will be reduced until the total allocation percentage of all de minimis Subzones is less than or equal to 10%. Id.
198 Proposed OATT Section 38.22.3.
199 See Initial RMR Order at PP 14-15.
200 Proposed OATT Section 38.22.4.
Honorable Kimberly D. Bose September 19, 2016
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and voltage violations are inherently a local issue driven by reactive power draw to service local Load. Accordingly, it is appropriate to allocate the costs attributable to these violations on a Load-ratio share basis to LSEs at the local Subzone level, which is the lowest level of granularity at which the NYISO can allocate these costs.
4. Dynamic Stability Cost Allocation Step
If, after completion of the preceding steps in the methodology, there remains a dynamic stability issue, the NYISO will allocate the costs of the portion of the solution attributable to resolving a dynamic stability issue to all Subzones in the NYCA on a Load-ratio share basis.201 This additional step in the hierarchy is required because a Generator Deactivation Solution may be required to address a Reliability Need resulting from dynamic stability issues. Dynamic stability is a systemic issue that can lead to widespread cascading and outages. For this reason, the entire NYCA benefits from a solution resolving a dynamic stability issue.
5. Short Circuit Issues
Finally, if, after the completion of all of the prior steps in the methodology, there remains a short circuit issue, the short circuit issue will be deemed a local issue and related costs will not be allocated under the OATT.202 The NYISO proposes to insert this final step for completeness purposes as it clarifies how the NYISO will address a Reliability Need that results from a short circuit issue. In such case, a Generator would not be used to resolve the issue. Short circuit
issues, or fault current issues, are inherently local, driven primarily by electrically-local
generators, transmission system configuration, and transmission system impedance. Regional
load and power transfers do not contribute to fault current, and therefore should not be allocated costs for Reliability Needs related to fault current.
B. Justification for Cost Allocation Methodology
Although the Commission has directed the NYISO to separate the cost allocation
mechanism used for Generator Deactivation Solutions from the cost allocation provisions of the
NYISO’s Order No. 1000 planning process in Attachment Y, the cost allocation principles that
underpin the Order No. 1000 process are fundamentally the same as the principles that underpin
the allocation of costs for Generator Deactivation Solutions. The primary goal in cost allocation
is to ensure that the rates paid by customers are at least roughly commensurate with the costs
actually caused by those customers, and that customers who receive no benefit from an upgrade,
and therefore do not cause those costs to be incurred, should not be assessed any of such costs.203
Indeed, these are the core rules set forth in the Commission’s Order No. 1000 cost allocation
201 Proposed OATT Section 38.22.5.
202 Proposed OATT Section 38.22.6.
203 See Public Service Commission of Wisconsin v. Midcontinent Independent System Operator,
Inc., 148 FERC ¶ 61,071 at P 61 (2014) (“all approved rates[must] reflect to some degree the costs
actually caused by the customer who pays them”) (citing Black Oak Energy, LLC v. FERC, 725 F.3d 230, 364 (D.C. Cir. 2013).
Honorable Kimberly D. Bose September 19, 2016
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principles, with the added requirements that cost allocation rules may impose different types of
cost allocation mechanisms for different types of upgrades, that the rules not impose too high a
burden on new facilities that have significant net benefits, and that the rules be transparent.
The NYISO respectfully submits that these core cost allocation requirements all are
satisfied in this instance. The NYISO is proposing to allocate costs only to those entities that
receive a benefit from a Generator Deactivation Solution, and that such allocated costs be
commensurate with the reliability benefit that each paying entity receives from the Generator
Deactivation Solution. An entity will not be allocated costs if it receives no benefit from a
Generator Deactivation Solution, and the mechanism itself is fully transparent. The cost
allocation mechanism that the NYISO proposes here is fundamentally the same as the cost
allocation mechanism that the Commission recently accepted in Docket No. ER16-1968-000 for
the reliability planning process.204 Accordingly, the NYISO respectfully requests that the
Commission approve the proposed cost allocation mechanism in Attachment FF.
C.Cost Recovery Requirements
i.Cost Recovery for Regulated Transmission Solutions
Sections 6.16 and 38.23 of the OATT establish the mechanism pursuant to which the NYISO will recover from Load Serving Entities the cost related to a Developer’s transmission solution to a Generator Deactivation Transmission Need. The cost recovery requirements are based on and are generally consistent with the cost recovery requirements previously accepted by the Commission for the NYISO’s transmission planning process, which requirements are set forth in Sections 6.10 and 31.5.6 of the OATT.
Pursuant to the Generator Deactivation Process requirements, the Responsible
Transmission Owner or any other Developer of a transmission solution that is selected by the NYISO in the Generator Deactivation Process may recover through a Generator Deactivation Facilities Charge (“GDFC”) all of its reasonably incurred costs, as determined by the
Commission, related to the preparation of proposals for, and the development, financing,
construction, operation, and maintenance of, the selected project.205 Such cost includes, but is not limited to, a reasonable return on investment and any incentives for the construction of
transmission projects approved under Sections 205 or Section 219 of the Federal Power Act and the Commission’s regulations implementing those sections.206
204 New York Independent System Operator, Inc., Letter Order, Docket No. ER16-1968-000 (August 12, 2016).
205 Proposed OATT Sections 6.16.4.1, 38.23.1.
206 Proposed OATT Sections 6.16.4.1. OATT Section 6.16.5 establishes cost recovery rules that are specific to the New York Power Authority (“NYPA”) and the Long Island Power Authority (“LIPA”), as Unregulated Transmitting Utilities that are not subject to the Commission’s jurisdiction under Sections 205 and 206(a) of the Federal Power Act. These separate cost recovery rules are similar to the separate NYPA and LIPA requirements for recovering the costs of their projects in the NYISO’s reliability
planning process that are set forth in Schedule 10 of the OATT.
Honorable Kimberly D. Bose September 19, 2016
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As it is obligated to submit a project proposal to maintain system reliability, the
Responsible Transmission Owner may also recover its cost for developing its proposed
transmission solution and, if applicable, its conceptual permanent solution, regardless of whether the project is selected by the NYISO to proceed with construction.207 Finally, as described in Parts III.J.ii and III.L above, if a Developer’s selected transmission project is halted or has its request for a necessary governmental authorization rejected or withdrawn, the Developer may recover the necessary and reasonable costs it had previously incurred and the reasonable and necessary expenses required for an ordinary termination of the project.208
The Developer or the NYISO209 will file on the Developer’s behalf with the Commission
for its review and approval or acceptance, the final project cost and resulting revenue
requirement to be recovered through the GDFC.210 The NYISO will begin to calculate and bill
the GDFC after the Commission has accepted or approved the filing. The period for cost
recovery will be determined by the Commission and will begin if and when the project is
completed or halted, or as otherwise determined by the Commission. The base revenue
requirements will be adjusted to reflect any Incremental Transmission Rights Revenue resulting
from the allocation of Incremental TCCs to the Eligible Project as well as any outage charges
attributable to such project.
The ISO will recover the costs approved or accepted by the Commission from Load
Serving Entities serving Load in the Load Zones and/or Subzones to which the cost of the
transmission project are allocated in accordance with the cost allocation methodology for the
Generator Deactivation Process using the methodology set forth in Section 6.16.3.4 of the
OATT. Each Load Serving Entity is charged based on its Actual Energy Withdrawals in the
Load Zones or Subzones to which costs are allocated.211 The ISO will remit the recovered costs
to the appropriate Developer in accordance with its billing and settlement procedures.212
ii. Cost Recovery for RMR Generators Operating Under RMR Agreements
Section 38.23.4 establishes that an RMR Generator operating under an RMR Agreement will be paid in accordance with Rate Schedule 8 of the Services Tariff, and the NYISO will recover costs related to the RMR Agreement from Load Serving Entities in accordance with Schedule 14 of the OATT. The revisions to these schedules to address Interim Service Provider requirements and claw-back rules are described in Parts IV.A and IV.C above.
207 Proposed OATT Sections 6.16.1, 38.23.1.
208 Proposed OATT Sections 38.12.2.2, 38.15.1, 38.23.2, 38.23.3.
209 Regardless of which party makes the filing, the Developer shall bear the burden of resolving
all concerns about the contents of the filing that might be raised in such proceeding. Proposed OATT
6.16.4.2, 6.16.5.2.2, 6.16.5.3.1.
210 Proposed OATT Section 6.16.4.2.
211 Proposed OATT Sections 6.16.3, 6.16.3.1. 212 Proposed OATT Sections 6.16.3.5.
Honorable Kimberly D. Bose September 19, 2016
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iii.Other
Transmission Owners undertaking projects through their Local Transmission Owner Planning Process are not eligible to recover the costs of these projects under the NYISO
tariffs.213 In addition, with the exception of a Generator operating under an RMR Agreement, costs related to non-transmission regulated solutions to a Generator Deactivation Reliability Need, such as demand response, may be recovered by Developers in accordance with New York state law.214 Finally, market-based solutions are not eligible for cost recovery under Rate
Schedule 8 of the Services Tariff or Schedules 14 or 16 of the OATT.215
VII. EFFECTIVE DATE
With a limited exception described below, the NYISO respectfully requests that the
Commission accept the tariff revisions proposed in this compliance filing with an October 20,
2015 effective date. This is the effective date the Commission accepted in its April Order for the
tariff provisions filed in the October 2015 Filing for which all parties are on notice.216 The
NYISO requests that its tariff revisions to OATT Section 31.11, Form of Operating Agreement,
have a different effective date of April 1, 2016. The base OATT Section 31.11 that the NYISO
proposes to modify in this filing was filed with the Commission in Docket No. ER13-102-009 on
March 22, 2016, with an errata correction submitted on May 24, 2016, with a requested effective
date of April 1, 2016. The filing in Docket No. ER13-102-009 is currently pending before the
Commission.
VIII. COMMUNICATIONS
Communications and correspondence regarding this filing should be directed to:
Robert E. Fernandez, General Counsel
Raymond Stalter, Director of Regulatory Affairs Karen G. Gach, Deputy General Counsel
*Alex M. Schnell, Assistant General Counsel,
Registered Corporate Counsel
*Carl F. Patka, Assistant General Counsel
New York Independent System Operator, Inc.
10 Krey Boulevard
Rensselaer, NY 12144
213 Proposed OATT Section 38.23.1. 214 Proposed OATT Section 38.23.5. 215 Proposed OATT Section 38.4.2.2. 216 April Order at P 14.
*Ted J. Murphy
Hunton & Williams LLP 2200 Pennsylvania Ave, NW Washington, DC 20037
Tel: (202) 955-1500
Fax: (202) 778-2201
tmurphy@hunton.com
*Michael J. Messonnier217
217 Waiver of the Commission’s regulations (18 C.F.R. § 385.203(b)(3) (2014)) is requested to the extent necessary to permit service on counsel for the NYISO in Rensselaer, NY, Richmond, VA and
Washington, DC.
Honorable Kimberly D. Bose September 19, 2016
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Tel: (518) 356-6000
Fax: (518) 356-4702
rfernandez@nyiso.com
rstalter@nyiso.com
kgach@nyiso.com
aschnell@nyiso.com
cpatka@nyiso.com
*Persons designated to receive service
IX.LIST OF DOCUMENT SUBMITTED
Hunton & Williams LLP Riverfront Plaza, East Tower 951 East Byrd Street
Richmond, VA 23219
Tel: (804) 788-8712
Fax: (804) 343-4646
mmessonnier@hunton.com
The NYISO respectfully submits the following documents with this filing letter:
1. A clean version of the proposed revisions to the OATT, effective October 20, 2015
(Attachment I);
2. A blacklined version of the proposed revisions to the OATT, effective October 20,
2015 (Attachment II);
3. A clean version of the proposed revisions to the OATT, effective April 1, 2016
(Attachment III);
4. A blacklined version of the proposed revisions to the OATT, effective April 1, 2016
(Attachment IV);
5. A clean version of the proposed revisions to the Services Tariff (Attachment V);
6. A blacklined version of the proposed revisions to the Services Tariff (Attachment
VI);
7. Affidavits of Zachary G. Smith and Shaun Johnson (Attachment VII);
8. A clean version of certain sections of the OATT incorporating tariff revisions that
have, or have been proposed to, become effective subsequent to the October 20, 2015
effective date requested for the tariff revisions proposed herein (Attachment VIII);218
and
9. A clean version of certain sections of the Services Tariff incorporating tariff revisions
that have, or have been proposed to, become effective subsequent to the October 20,
218 OATT Section 1.9 was filed July 31, 2015 in ER15-2345-000 and September 13, 2016 in ER13-102-
011; OATT Section 31.1 was filed February 18, 2016 and May 18, 2016 in ER16-966-000 and -001 and March 22, 2016 and September 13, 2016 in ER13-102-009 and -011; OATT Section 31.2-31.2.7was filed May 18, 2016 in ER16-966-001 and March 22, 2016 in ER13-102-009; OATT Section 31.2.8-31.2.13 was filed March 22, 2016 in ER13-102-009; OATT Section 31.11 was filed March 22, 2016 in ER13-102-009, May 24, 2016 in ER13-102-010 and September 13, 2016 in ER13-102-011;
Honorable Kimberly D. Bose September 19, 2016
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2015 effective date requested for the tariff revisions proposed herein (Attachment
IX).219
X.SERVICE
The NYISO will send an electronic copy of this filing to the official representative of
each party to this proceeding, to the official representative of each of its customers, to each
participant on its stakeholder committees, to the New York Public Service Commission and the
New Jersey Board of Public Utilities. In addition, the complete public version of this filing will
be posted on the NYISO’s website at www.nyiso.com.
XI.CONCLUSION
WHEREFORE, the New York Independent System Operator, Inc. respectfully requests that the Commission accept this compliance filing without requiring any modifications and
determine that the NYISO has fully complied with the directives of the April Order and the
Initial RMR Order.
Respectfully submitted,
NEW YORK INDEPENDENT SYSTEM OPERATOR, INC. By: /s/ Alex M. Schnell
Alex M. Schnell,
Assistant General Counsel,
Registered Corporate Counsel
By: /s/ Carl F. Patka
Carl F. Patka,
Assistant General Counsel
cc:Michael BardeeAnna Cochrane
Kurt LongoMax Minzner
Daniel NowakLarry Parkinson
J. Arnold QuinnDouglas Roe
Kathleen SchnorfJamie Simler
Gary Will
219 Services Tariff Section 2.9 was filed May 20, 2016 in ER16-1751-000 and September 13, 2016 in
ER13-102-011; Services Tariff Section 5.12 was filed October 30, 2015 in ER16-185-000; Services Tariff Section
23.2 was filed March 22, 2016 in ER16-1213-000; Services Tariff Section 23.4.5 was filed March 22, 2016 in
ER16-1213-000 and September 13, 2016 in ER13-102-011; and Services Tariff Section 30.4 was filed May 20, 2016 in ER16-1751-000 and on November 30, 2015, June 7, 2016, June 21, 2016 and June 22,2016 in ER16-425-000, -
002, -004 and -005 respectively.
