March 19, 2018
By Electronic Delivery
Honorable Kimberly D. Bose, Secretary Federal Energy Regulatory Commission 888 First Street, NE
Washington, DC 20426
Re: New York Independent System Operator, Inc., Compliance Filing,
Docket Nos. ER13-102-008, -009, -010, -011, -____
Dear Secretary Bose:
The New York Independent System Operator, Inc. (“NYISO”)1 hereby submits revisions
to its Open Access Transmission Tariff (“OATT”)2 and its Market Administration and Control
Area Services Tariff (“Services Tariff”) concerning its compliance with the Order No. 1000
regional transmission planning requirements.3 The proposed revisions in this compliance filing
fulfill the directives of the Federal Energy Regulatory Commission (“Commission”) in its
February 15, 2018, Order Conditionally Accepting Tariff Revisions and Requiring Further
Compliance (“February 2018 Order”)4 and Order Granting, in Part, and Denying, in Part,
1 Due to the nature of the matters addressed in this compliance filing that relate to the treatment of Developers of transmission and Transmission Owners that will apply to both the existing New York
Transmission Owners and non-incumbent Developers, the NYISO submits this compliance filing on its
own, with the understanding that the New York Transmission Owners and other interested parties may
file separate comments.
2 Capitalized terms that are not otherwise defined in this filing letter shall have the meaning specified in Attachment Y or Attachment P of the NYISO OATT, and if not defined therein, in the NYISO OATT and the NYISO Services Tariff.
3 Transmission Planning and Cost Allocation by Transmission Owning and Operating Public
Utilities, Order No. 1000, 136 FERC ¶ 61,051 (2011) (“Order No. 1000”), order on reh’g and
clarification, Order No. 1000-A, 139 FERC ¶ 61,132 (2012) (“Order No. 1000-A”), order on reh’g and clarification, 141 FERC ¶ 61,044 (2012) (“Order No. 1000-B”). For convenience, unless otherwise
specified, references in this filing to “Order No. 1000” should be understood to encompass Order Nos.
1000, 1000-A, and 1000-B.
4 New York Independent System Operator, Inc., Order Conditionally Accepting Tariff Revisions and Requiring Further Compliance, 162 FERC ¶ 61,107 (2018) (“February 2018 Order”).
Honorable Kimberly D. Bose March 19, 2018
Page 2
Rehearing and Clarification, and Requiring Further Compliance (“Rehearing Order”) in the above-captioned proceeding.5
The NYISO respectfully submits that its proposed compliance revisions described in
Parts II through V below fully comply with the directives of the February 2018 Order and
Rehearing Order, are fully supported, are just and reasonable, and should be accepted without
modification or condition.6 As described in Part VI below, the NYISO respectfully requests that the Commission accept these tariff revisions with an effective date of April 1, 2016 with the
exception of those revisions detailed in Parts III.A through III.D, for which the NYISO requests an effective date of March 20, 2018.
I.BACKGROUND
In response to the Order No. 1000 regional transmission planning and cost allocation
directives, the NYISO and the New York Transmission Owners have submitted compliance
filings to revise the NYISO’s tariff requirements for its Comprehensive System Planning Process
(“CSPP”), which is composed of the NYISO’s local transmission planning, reliability, economic,
and public policy transmission planning processes. In previous Orders, the Commission has
largely accepted the NYISO’s revised CSPP as compliant with the Order No. 1000
requirements.7
5 New York Independent System Operator, Inc., Order Granting, in Part, and Denying, in Part,
Rehearing and Clarification, and Requiring Further Compliance, 162 FERC ¶ 61,124 (2018) (“Rehearing
Order”).
6 The proposed tariff revisions included in this filing are those expressly required by the
directives in the February 2018 Order and Rehearing Order. In addition, the proposed tariff revisions in
this filing include additional limited tariff revisions that are necessary to either implement or clarify the
existing tariff language to accommodate those directives; or are non-substantive organizational or
clarifying adjustments necessary to make the NYISO’s Order No. 1000-related tariff provisions clearer
and to conform related tariff provisions to those expressly required by the directives of the February 2018
Order and Rehearing Order. It is consistent with Commission precedent to include such tariff revisions in
this compliance filing. The Commission has previously authorized the NYISO to include these kinds of
limited, but necessary, clarifications in compliance filings and should follow that precedent here. 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).
7 See New York Independent System Operator, Inc., Order Conditionally Accepting Tariff
Revisions and Requiring Further Compliance, 153 FERC ¶ 61,341 (2015); New York Independent System Operator, Inc., Order on Rehearing and Compliance, 151 FERC ¶ 61,040 (2015); New York Independent System Operator, Inc., Order on Rehearing and Compliance, 148 FERC ¶ 61,044 (2014); New York
Independent System Operator, Inc., Order on Compliance Filing, 143 FERC ¶ 61,059 (2013).
Honorable Kimberly D. Bose March 19, 2018
Page 3
In response to the Commission’s December 23, 2015, order in this proceeding
(“December 2015 Order”),8 the NYISO submitted on March 22, 2016 and September 13, 2016
its fifth and six compliance filings.9 These filings included: (i) new Transmission
Interconnection Procedures, along with related revisions to the NYISO’s existing interconnection
and transmission expansion requirements in the OATT; (ii) a new pro forma development
agreement for the NYISO’s Public Policy Transmission Planning Process (“Public Policy
Development Agreement”) and related tariff revisions; (iii) revisions to the pro forma
development agreement for the NYISO’s reliability planning process (“Reliability Development
Agreement”) and related tariff revisions; (iv) a new pro forma operating agreement for Non-
Incumbent Transmission Owners (“Operating Agreement”); and (v) tariff revisions to clearly
outline the rights and responsibilities of existing and new Transmission Owners under the
NYISO’s tariffs. The NYISO separately requested rehearing on January 27, 2016, of the
Commission’s determinations in the December 2015 Order concerning: (i) the indemnification
requirements in the Reliability Development Agreement and (ii) which parties must execute that
agreement.10
On February 15, 2018, the Commission issued two orders addressing the NYISO’s
compliance filings and its request for rehearing. In the February 2018 Order, the Commission
accepted in large part the NYISO’s tariff revisions. The February 2018 Order directed the
NYISO to submit a further compliance filing within 30 days to make a limited number of
additional revisions concerning the Transmission Interconnection Procedures, the Operating
Agreement, the Reliability Development Agreement, and related provisions in the NYISO
OATT. In addition, in the Rehearing Order, the Commission granted the NYISO’s rehearing
request concerning the indemnification requirements in the Reliability Development Agreement
and directed the NYISO to submit within 30 days a compliance filing to implement the required
changes.
In response to the directives in the February 2018 Order and the Rehearing Order, the
NYISO proposes the revisions to its tariffs described in Parts II through V below. The NYISO
discussed these tariff revisions with stakeholders at the joint meeting of the Transmission
Planning Advisory Subcommittee and the Electric System Planning Working Group meeting on
March 8, 2018.
8 See New York Independent System Operator, Inc., Order Conditionally Accepting Tariff
Revisions and Requiring Further Compliance, 153 FERC ¶ 61,341 (2015) (“December 2015 Order”).
9 See New York Independent System Operator, Inc., Compliance Filing, Docket No. ER13-102-
009 (Mar. 22, 2016); New York Independent System Operator, Inc., Errata Correcting Compliance Filing, Docket No. ER13-102-010 (May 24, 2016); New York Independent System Operator, Inc., Compliance Filing, Docket No. ER13-102-011 (Sept. 13, 2016).
10 See New York Independent System Operator, Inc., Request for Rehearing and Clarification of New York Independent System Operator, Inc., Docket No. ER13-102-008 (Jan. 27, 2016).
Honorable Kimberly D. Bose March 19, 2018
Page 4
II. TRANSMISSION INTERCONNECTION PROCEDURES
In the December 2015 Order, the Commission determined that the NYISO’s existing process for evaluating the interconnection of transmission projects that are proposed to satisfy needs identified in the CSPP to be unjust and unreasonable.11 In complying with the
Commission’s directive, the NYISO developed with stakeholder input a new interconnection process—the Transmission Interconnection Procedures in Attachment P to the OATT—that
uniformly studies proposed transmission projects regardless of whether the project was proposed by an incumbent or non-incumbent transmission developer.
In the February 2018 Order, the Commission accepted the Transmission Interconnection
Procedures in large part and directed the NYISO to make the following specific revisions: (i)
clarify that the NYISO will not forward Transmission Interconnection Applications to the
Connection Transmission Owner before the close of a competitive solicitation window under the
CSPP; (ii) explain whether the Transmission Interconnection Procedures apply to incumbent
Transmission Owners’ market-based project proposals; (iii) revise the definition of “Merchant
Transmission Facility” to be consistent with the Commission’s definition in Order No. 1000; (iv)
revise Section 3.7 of the OATT to refer to both System Impact Studies and Transmission System
Studies, as appropriate; and (v) correct or explain a reference to “Section 31.3.1.3” in Section
22.3.1.2 of Attachment P to the OATT.12 In response to the Commission’s directives, the NYISO proposes the following revisions.
A. Revisions to Await the Close of a Solicitation Window Before Forwarding a
CSPP-Related Transmission Interconnection Application to the Connecting
Transmission Owner(s)
In accordance with the Commission’s directive,13 the NYISO revised Section 22.4.2.2 of
Attachment P to provide that it shall not forward a Transmission Interconnection Application
that is submitted in connection with a proposed solution to a need identified in the CSPP to the
Connecting Transmission Owner(s) until after the close of the applicable solicitation window.14
As a result of retaining the Transmission Interconnection Application until after the close of the
solicitation window and being unable to receive input from the Connecting Transmission
Owner(s) on the application, the NYISO would be limited in the actions that it can take in
processing the application under Section 22.4.2.3 of Attachment P. To account for these
limitations, the NYISO also clarified that an application cannot be considered to be valid until
after the close of the solicitation window, and the NYISO has up to five (5) Business Days
following the close of a solicitation window to notify a Transmission Developer of deficiencies
11 December 2015 Order at PP 67-68.
12 February 2018 Order at P 39.
13 See id. at PP 39-40.
14 See OATT Sections 22.4.2.2 and 22.4.2.3.
Honorable Kimberly D. Bose March 19, 2018
Page 5
in its application.15 The revisions further state that any information received from a
Transmission Developer related to its application cannot be forwarded until the close of the applicable window.16
In addition, the NYISO added corresponding revisions in the Large Facility
Interconnection Procedures under Attachment X, which are applicable to transmission projects that are proposed by incumbent or non-incumbent transmission developers and eligible for and request Capacity Resource Interconnection Service (“CRIS”) subject to the eligibility
requirements set forth in the ISO Procedures. Consistent with the revisions proposed in
Attachment P, the revisions to Attachment X make clear that the NYISO shall not forward an Interconnection Request that is for a proposed solution under the CSPP to the Connecting
Transmission Owner(s) until after the close of the applicable solicitation window.17 This
revision is consistent with the Commission’s directive in the February 2018 Order to prevent the potential that receipt of an Interconnection Request by a Connecting Transmission Owner prior to the close of a solicitation could result in a competitive advantage.
Because the NYISO will not be able to validate an application or request until after the
close of a solicitation window, the NYISO made conforming revisions to Attachment Y of the
OATT to remove the requirement that a Developer submit a “valid” transmission interconnection
application or interconnection request, as applicable, along with its proposed solution to a
Reliability Need or a Public Policy Transmission Need.18 As revised, a Developer need only
submit a transmission interconnection application or interconnection request, as applicable.
B.Clarification Related to the Study of Transmission Owners’ Market-Based
Proposals
In its February 2018 Order, the Commission requested clarification regarding the
applicable interconnection process for market-based transmission projects proposed by
incumbent Transmission Owners.19 As explained below, such projects may be subject to either the Transmission Interconnection Procedures or the Large Facility Interconnection Procedures, depending upon whether the transmission project is eligible for CRIS and whether the
Transmission Owner requests CRIS in its interconnection application.
In response to the Commission’s directives in the December 2015 Order, the NYISO
proposed the Transmission Interconnection Procedures under Attachment P to apply broadly to
transmission projects proposed by any entity—whether an incumbent Transmission Owner or a non-
incumbent Transmission Developer—that is proposing a new transmission facility or upgrade to
15 See revised OATT Section 22.4.2.2.
16 See id.
17 See revised OATT Sections 30.3.3.2 and 30.3.3.3.
18 See revised OATT Sections 31.2.5.1 and 31.4.4.3.1.
19 February 2018 Order at PP 39, 41.
Honorable Kimberly D. Bose March 19, 2018
Page 6
the New York State Transmission System.20 The Transmission Interconnection Procedures
apply to the interconnection of all proposed transmission facilities with two exceptions. The first
exception includes proposed transmission facilities identified in a Transmission Owner’s local
transmission plan or NYPA’s transmission plan, which would be evaluated in Section 3.7 of the
OATT. The second exception includes proposed controllable transmission lines for which the
proposing entity is seeking CRIS to receive Unforced Capacity Deliverability Rights.21 Based
on the expansive definition of “Transmission Project” subject to the Transmission
Interconnection Procedures, market-based transmission projects proposed by incumbent
Transmission Owners are subject to Attachment P, unless the project is eligible for and seeks
CRIS, in which case the proposed facility would be studied in the Large Facility Interconnection Procedures pursuant to Attachment X to the OATT.
To further clarify that an incumbent Transmission Owner that proposes a market-based solution would have to go through the Transmission Interconnection Procedures, unless
requesting CRIS, the NYISO revised Section 3.7 of the OATT to provide additional mapping in the tariff of the interconnection procedures applicable to the various types of transmission
projects. The revised language makes clear that Transmission Owners that propose any new
transmission facility or upgrade, other than an upgrade or expansion identified in its local
transmission plan, “regardless of whether the Transmission Owner seeks cost allocation under the ISO OATT or proposes a market-based project,” shall be required to go through the
Transmission Interconnection Procedure under Attachment P or, if requesting CRIS, the Large Facility Interconnection Procedures under Attachment X.22
C. Revisions to the Definition of Merchant Transmission Facility
In response to the Commission’s directive in the February 2018 Order,23 the NYISO
revised the definition of “Merchant Transmission Facility” to be consistent with the definition in
Order No. 1000, which defines a “Merchant Transmission Facility” as a facility for which the
costs of construction are recovered through negotiated rates as opposed to cost-based rates.24
Specifically, the NYISO revised the definition of “Merchant Transmission Facility” in Section
30.1 of Attachment X and added an identical definition to Section 31.1.1 of Attachment Y, as
follows:
Merchant Transmission Facility shall mean a Developer’s proposed new
transmission facility that will interconnect to the New York State Transmission
System or a proposed upgrade—an improvement to, addition to, or replacement of
a part of an existing transmission facility—to the New York State Transmission
20 See OATT Section 22.3.1.3; New York Independent System Operator, Inc., Compliance Filing, Docket No. ER13-102-009 at p 11 (March 22, 2016).
21 See OATT Section 22.3.1.3.
22 See February 2018 Order at P 41.
23 See id. at PP 39, 42.
24 See id. at P 42 (citing Order No. 1000, FERC Stats. & Regs. ¶ 31,323 at P 119).
Honorable Kimberly D. Bose March 19, 2018
Page 7
System, for which the costs of construction will be recovered through negotiated
rates instead of cost-based rates and not subject to the competitive evaluation and
selection process for purposes of cost allocation under Attachment Y to the ISO
OATT. Merchant Transmission Facilities shall not include Attachment Facilities,
Network Upgrade Facilities, System Upgrade Facilities or System Deliverability
Upgrades.
To incorporate the revised definition of “Merchant Transmission Facility” into the
NYISO’s tariffs, the NYISO added the term “Class Year Transmission Project” to capture
transmission projects that fell under the former definition of “Merchant Transmission Facility”25
and, if not seeking cost-based rate recovery for its construction costs, are a subset of the new
definition of “Merchant Transmission Facility.” Consistent with the NYISO’s current practice,
transmission facilities seeking CRIS must participate in the Class Year Interconnection Facilities
Study process, including the deliverability study set forth in Attachments X and S to the
OATT.26 As a result, the Transmission Interconnection Procedures, as initially proposed, and
the former definition of “Merchant Transmission Facility” provided, that transmission projects
eligible for and requesting CRIS, subject to the eligibility requirements set forth in the ISO
Procedures, are required to proceed through the Large Facility Interconnection Procedures in
Attachment X as opposed to the Transmission Interconnection Procedures in Attachment P. To
account for these transmission projects, the NYISO created the new term “Class Year
Transmission Project” that includes those transmission facilities that are eligible to request and
do request CRIS subject to the eligibility requirements set forth in the NYISO procedures, and
are specifically excluded from being evaluated in the Transmission Interconnection
Procedures.27 The NYISO conducted a comprehensive review of the NYISO’s tariffs to adjust,
align, and/or add references to “Merchant Transmission Facilities” and “Class Year
Transmission Project,” accordingly.28
25 Revised OATT Section 30.1 provides the following definition:
“Class Year Transmission Project shall mean a Developer’s proposed new transmission facility that will interconnect to the New York State Transmission System or a proposed upgrade—an improvement to, addition to, or replacement of a part of an existing transmission facility—to the New York State Transmission System, for which the Developer is eligible to request and does request Capacity Resource Interconnection Service, subject to the eligibility requirements set forth in the ISO Procedures. Class Year Transmission Projects shall not include Attachment Facilities, Network Upgrade Facilities, System Upgrade Facilities or System Deliverability Upgrades.”
26 See OATT Section 30.1.
27 See revised OATT Section 22.3.1.3. As set forth in Section 22.3.1.2 of Attachment P,
Merchant Transmission Facilities that do not also satisfy the definition of “Class Year Transmission Project” will proceed through the Transmission Interconnection Procedures.
28 See generally, revised OATT Section 1.4; Section 6.12.4; Section 22.3.1.3 of Attachment P;
OATT Sections 25.1, 25.3.1.2, 25.5.5, 25.6.2.3.1.1.4, and 25.7 of Attachment S; OATT Sections 30.1,
30.2.1, 30.2.2, 30.2.4, 30.3.1, 30.3.2.2, 30.6.2, 30.7.2.2, 30.7.3, 30.14 of Attachment X, OATT Sections
Honorable Kimberly D. Bose March 19, 2018
Page 8
D.Conforming Revisions to the References to Studies under Section 3.7 of the
OATT
Section 3.7.1 of the OATT distinguishes System Impact Studies from Transmission
Service Studies—both of which fall under Section 3.7 of the OATT. System Impact Studies
evaluate proposed transmission upgrades and expansions identified in a Local Transmission
Owner Plan or NYPA transmission plan. Transmission Service Studies, on the other hand, are
performed for an Eligible Customer that requests the NYISO study facilities that could be
constructed (e.g., where an Eligible Customer requests the NYISO to identify possible
transmission options to increase transfer capability). As the Commission identified in paragraph
43 of the February 2018 Order, there are instances where Section 3.7 of the OATT only refers to System Impact Studies, but should reference both System Impact Studies and Transmission
Service Studies.
Therefore, as directed by the Commission, the NYISO added references to “Transmission
System Study” where the NYISO mentions System Impact Studies throughout Section 3.7 of the
OATT, with the exception of the provisions in Section 3.7 of the OATT describing the Facilities
Study.29 Unlike upgrades or expansions identified in a Transmission Owner’s local transmission
plans or NYPA transmission plan that would be evaluated in a Facilities Study under Section
3.7.4 of the OATT, an Eligible Customer that requests a conceptual evaluation of a transmission project can have such request studied in a Transmission Service Study under Section 3.7 of the OATT, but then must proceed to the Transmission Interconnection Procedures to proceed with further evaluation, as opposed to conducting a Facilities Study under Section 3.7.30 To account for this difference, the NYISO did not include corresponding references to “Transmission
Service Studies” in Section 3.7.4 of the OATT.
E.Ministerial Revision
In compliance with paragraph 44 of the February 2018 Order, the NYISO also made the
ministerial correction to the reference of “Section 31.3.1.3 of the OATT” for exceptions to the
definition of Transmission Project, which has been amended to refer to Section 22.3.1.3 of the
OATT.31
31.1.1, 31.2.2.4.1, 31.3.1.4, 31.5.1.3, and 31.5.3.2 of Attachment Y; OATT Section 32.5 of Attachment X; OATT Section 38.22 of Attachment FF; and Services Tariff Section 5.16.1.1.
29 See February 2018 Order at P 43.
30 See revised OATT Section 3.7.3. An Eligible Customer is not required to obtain a conceptual
study of a transmission project prior to submitting a transmission interconnection application, and may
proceed directly to the Transmission Interconnection Procedures under Attachment P to the OATT. See
id.
31 See February 2018 Order at P 44.
Honorable Kimberly D. Bose March 19, 2018
Page 9
III.OPERATING AGREEMENT
As directed by the December 2015 Order, the NYISO submitted with its March 22, 2016, compliance filing a pro forma Operating Agreement for Non-Incumbent Transmission Owners (“NTOs”), which agreement is located in Section 31.11 of Attachment Y of the OATT. The Operating Agreement is largely consistent with and comparable to the Agreement Between New York Independent System Operator and Transmission Owners (“ISO/TO Agreement”) that was entered into among the NYISO and incumbent Transmission Owners in 1999.32
In the February 2018 Order, the Commission accepted the Operating Agreement in large part and directed the NYISO to make a limited number of revisions to the agreement.33 In
response to the directives in the February 2018 Order, the NYISO has made the following
changes to the Operating Agreement and to its Services Tariff.
In response to paragraph 134 of the February 2018 Order, the NYISO revised Article
3.08a of the Operating Agreement to conform it with the same provision of the ISO/TO
Agreement (i.e., Article 3.10a).34 With this revision, Article 3.08 of the Operating Agreement is
comparable to Article 3.10 of the ISO/TO Agreement with only the following limited differences
between the provisions, which differences were included in the March 22, 2016 compliance
filing: (i) the term “Transmission Owner” was replaced with “NTO”; (ii) the term “FPA” was
replaced with “Federal Power Act”; (iii) the reference to “any other agreement or amendment
made in connection with the restructuring of the NYPP and establishment of the New York ISO”
was not carried over from the ISO/TO Agreement to the first sentence of Article 3.08 of the
Operating Agreement as it concerns the start-up of the NYISO; and (iv) minor revisions were
made in Article 3.08 to address the fact that there is only one Transmission Owner subject to this
agreement (e.g., the language “individually or collectively” was not carried over from the
ISO/TO Agreement into Article 3.08c).
In response to paragraphs 130 and 131 of the February 2018 Order, the NYISO inserted a
new Section 3.5.3 of the Services Tariff to require all Transmission Owners: (i) to provide
maintenance schedules to other Transmission Owners where those maintenance schedules would
directly impact other Transmission Owners’ facilities, and (ii) to provide to other Transmission
Owners information regarding the results of investigations of equipment malfunctions and
failures and forced transmission outages.35 Section 3.5.3 of the Services Tariff also provides for
the Transmission Owner receiving this potentially non-public information concerning another
Transmission Owner’s transmission facilities to maintain the information in a manner consistent
with the Commission’s Standards of Conduct requirements in 18 C.F.R. § 358 or any more
restrictive requirement of the receiving Transmission Owner governing the sharing of
32 See Cent. Hudson Gas & Elec. Corp., et al., 88 FERC ¶ 61,138 at p 5 (1999).
33 See February 2018 Order at PP 122-123.
34 See id at PP 123, 134.
35 See id at PP 123, 130-131.
Honorable Kimberly D. Bose March 19, 2018
Page 10
Transmission System Information (as that term is defined in Attachment F of the OATT). The NYISO also revised Articles 2.08 and 2.10 of the Operating Agreement to reference this new tariff provision.36
The Commission also directed revisions to the limitation of liability provisions in Articles
5.01 and 5.02 of the Operating Agreement, finding the difference between these provisions and
the related provisions in the ISO/TO Agreement to be unduly discriminatory and preferential
because the NYISO’s “liability to incumbent and Nonincumbent Transmission Owners should be
limited to the same extent, which is to the extent it is limited under the OATT.”37 Specifically,
the Commission directed the NYISO to revise Articles 5.01 and 5.02 “to state that NYISO’s
liability to the Nonincumbent Transmission Owner is limited ‘as provided under the ISO
OATT.’”38 Accordingly, the NYISO has revised Articles 5.01 and 5.02 of the Operating
Agreement (i) to remove the previously-proposed variations from the related provisions in the
ISO/TO Agreement,39 and (ii) to insert, consistent with the Commission’s directive, a new
sentence at the end of each Article that provides that: “The ISO shall not be liable to the NTO or
any other party for any damages resulting from any act or omission in any way associated with
this Agreement, except to the extent provided for under the ISO OATT.” The Operating
Agreement is comparable to the ISO/TO Agreement because the new language required by the
Commission simply refers to the NYISO’s existing limitation of liability requirements set forth
in the OATT.40
The NYISO made the following additional changes to the Operating Agreement in response to the directives in the February 2018 Order:
• Revised Article 2.02 to remove the language that an NTO’s actions shall be performed in
accordance with “the transmission interconnection agreement(s) for its facilities”;41
• Revised Article 2.07 to remove the requirement that an NTO comply with the local
reliability rules and planning criteria of its Interconnecting Transmission Owner;42
36 See id.
37 See id. at P 136.
38 See id.
39 This revision included backing out the replacement of the word “under” with “in any way associated with” in the first sentence of Article 5.01.
40 See OATT Section 2.11.3(b). The Commission noted that the ISO/TO Agreement is silent on
the NYISO’s liability to incumbent Transmission Owners. See February 2018 Order at P 136 n. 193.
41 See February 2018 Order at PP 123, 126.
42 See id. at PP 123, 129.
Honorable Kimberly D. Bose March 19, 2018
Page 11
• Revised Article 4.01 to remove the NYISO’s right to assign the Operating Agreement;43
• Revised Articles 6.01 and 6.02 and deleted Section 6.03(c) to remove the requirements
that an NTO “obtain[] all regulatory approvals . . . and hav[e] on file with FERC its own
open access transmission tariff” before terminating the Operating Agreement;
withdrawing from the ISO Agreement, the OATT, and Services Tariff, and withdrawing
its assets from NYISO’s control;44 and
• Revised Article 6.10 to remove the NYISO’s right to seek an injunction or specific
performance.45
IV. DEVELOPMENT AGREEMENTS
The NYISO submitted in its March 22, 2016, compliance filing revisions to the pro
forma Reliability Development Agreement for its reliability planning process, which is located in Appendix C of Section 31.7 of Attachment Y of the OATT. The NYISO also submitted a new pro forma Public Policy Development Agreement for its Public Policy Transmission Planning Process, which is located in Appendix D of Section 31.7 of Attachment Y of the OATT. The Public Policy Development Agreement is substantially similar to the Reliability Development Agreement with a small number of differences to reflect the different purposes and procedures of the reliability and public policy transmission planning processes.
In the February 2018 Order, the Commission accepted these agreements in large part and
directed the NYISO to make certain limited revisions to the Reliability Development Agreement,
and to the related tariff requirements that address a Developer’s inability to complete a regulated
transmission solution in the NYISO’s reliability or public policy processes. In response to the
directives in the February 2018 Order, the NYISO has made the following revisions:
• Revised Article 8.1 of the Reliability Development Agreement and Section 31.2.10.1.2 of
Attachment Y of the OATT to remove from the provision concerning cost recovery in the
event of termination the “provided, however” clause expressly providing for the
Responsible Transmission Owner to recover costs to the extent permitted by the ISO/TO
Reliability Agreement;46
• Revised the definition of “ISO/TO Reliability Agreement” in the Reliability
Development Agreement and in Section 31.1.1 of Attachment Y of the OATT, so that the definition is the same in both locations;47 and
43 See id. at PP 123, 135.
44 See id. at PP 123, 139-141.
45 See id. at PP 123, 142.
46 See id. at PP 16-18.
47 See id. at P 173.
Honorable Kimberly D. Bose March 19, 2018
Page 12
• Removed the requirement in Section 31.2.10.1.3 of Attachment Y of the OATT that the
NYISO may take any action it reasonably considers appropriate in the event a Developer
is unable to complete its project.
The Commission also directed the NYISO to revise Section 31.4.12.3.1.3 of Attachment
Y of the OATT to remove the requirements that the NYISO: (i) submit a report to the NYPSC
and/or Commission in the event a Developer is unable to complete its project, and (ii) take any
action it reasonably considers appropriate in the event a Developer is unable to complete its
project.48 The Commission had previously directed the NYISO to make this change in an April
18, 2016, order49 in a separate proceeding in Docket No. ER16-966 that overlapped with the
Order No. 1000 compliance proceeding. The NYISO made this change in its May 18, 2016,
compliance filing in that proceeding,50 and the change was accepted by the Commission on
September 7, 2016.51
Additionally, in the Rehearing Order, the Commission granted the NYISO’s request for
rehearing concerning the indemnification requirements in Article 9.2 of the Reliability
Development Agreement. The Commission directed the NYISO to file revisions to the
agreement “to provide for the transmission developer to indemnify NYISO, except for acts of
gross negligence or intentional misconduct, and to make the terms in the provisions mutual to the
extent allowed under the NYISO OATT.”52 Accordingly, the NYISO proposes to revise Article
9.2 of the Reliability Development Agreement as follows:
Notwithstanding any other provision in the NYISO’s tariffs and agreements to the
contrary, each Party shall at all times indemnify and save harmless, as applicable,
the other Party, its directors, officers, employees, trustees, and agents or each of
them from any and all damages (including, without limitation, any consequential,
incidental, direct, special, indirect, exemplary or punitive damages and economic
costs), losses, claims, including claims and actions relating to injury to or death of
any person or damage to property, liabilities, judgments, demands, suits,
recoveries, costs and expenses, court costs, attorney and expert fees, and all other
obligations by or to third parties, arising out of, or in any way resulting from this
48 See id. at P 174.
49 New York Independent System Operator, Inc., 155 FERC ¶ 61,037 at P 17 (2016).
50 New York Independent System Operator, Inc., Compliance Filing, Docket No. ER16-966-001
(May 18, 2016). Attachment III of the NYISO’s May 18, 2016 compliance filing in Docket No. ER16-
966 included a revised Section 31.4 of the OATT with an April 1, 2016 effective date that included the
NYISO’s tariff revisions proposed on March 22, 2016 in Docket No. ER13-102 on top of the revised
version of Section 31.4 from the May 18, 2016 filing in Docket No. ER16-966. The updated Section 31.4
included the removal of the requirements that the NYISO: (i) submit a report to the NYPSC and/or
Commission in the event a Developer is unable to complete its project, and (ii) take any action it
reasonably considers appropriate in the event a Developer is unable to complete its project.
51 New York Independent System Operator, Inc., 156 FERC ¶ 61,162 at PP 21-22 (2016).
52 Rehearing Order at PP 17-19.
Honorable Kimberly D. Bose March 19, 2018
Page 13
Agreement, provided, however, that the Developer shall not have any
indemnification obligation under this Article 9.2 with respect to any loss to the
extent the loss results from the gross negligence or intentional misconduct of the
NYISO; provided, further, that the NYISO shall onlynot have any
indemnification obligation under this Article 9.2 with respect to any loss resulting
from itsto the extent the loss results from thegross negligence or intentional
misconductof the Developer to the same extent as provided in Section 2.11.3(b) of
the ISO OATT. This Article 9.2 shall survive the termination, expiration, or
cancellation of this Agreement.
As revised, Article 9.2 provides that the Developer indemnify the NYISO for losses
resulting from this Agreement, except to the extent a loss results from the NYISO’s acts of gross
negligence or intentional misconduct. In addition, Article 9.2 makes the provision mutual to the
extent allowed under the NYISO OATT. Specifically, the NYISO will indemnify the Developer
to the same extent as the liability provided for in Section 2.11.3(b) of the OATT. Section
2.11.3(b) establishes that the NYISO shall not be liable, “except to the extent that the ISO is
found liable for gross negligence or intentional misconduct, in which case the ISO will only be liable for direct damages.”
The NYISO also made these same revisions to the indemnity requirements in Article 9.2
of the pro forma Public Policy Development Agreement. The Public Policy Development
Agreement was based on the Reliability Development Agreement and only differs where
necessary to accommodate differences between the NYISO’s reliability and public policy
transmission planning processes. There are no differences between the reliability and public
policy planning processes that would necessitate different indemnity requirements.
V.ADDITIONAL TARIFF REVISIONS
In the February 2018 Order, the Commission directed the NYISO to revise Section 31.6.4
of Attachment Y of the OATT, which describes the Transmission Owner’s rights concerning the
construction of upgrades and local transmission facilities. Specifically, the Commission directed
the NYISO to remove the language “outside of the ISO’s Tariffs,” from Section 31.6.4(1) and to
provide that “nothing in Attachment Y affects a Transmission Owner’s right to recover the cost
of upgrades to its facilities except if the upgrade has been selected in the regional cost allocation
method set forth in Attachment Y applies, unless the Transmission Owner has declined to pursue
regional cost allocation.”53 Accordingly, the NYISO has revised Section 31.6.4(1) as follows:
Nothing in this Attachment Y affects the right of a Transmission Owner to: (1)
build, own, and recover outside of the ISO’s Tariffs the costs for upgrades to the
facilities it owns, provided that nothing in Attachment Y affects a Transmission
Owner’s right to recover the costs of upgrades to its facilities except if the
upgrade has been selected in the regional transmission plan for purposes of cost
allocation, in which case the regional cost allocation method set forth in
Attachment Y of the ISO OATT applies, unless the Transmission Owner has
53 February 2018 Order at PP 159-161.
Honorable Kimberly D. Bose March 19, 2018
Page 14
declined to pursue regional cost allocationregardless of whether the upgrade has
been selected in the regional transmission plan for purposes of cost allocation; . . .
VI.EFFECTIVE DATE
Except as described below, the NYISO respectfully requests that the Commission accept the tariff revisions proposed in this compliance filing with an April 1, 2016, effective date. This is the effective date the Commission accepted in the February 2018 Order for the NYISO’s tariff revisions proposed in its fifth and sixth compliance filings.54
The NYISO further respectfully requests that the Commission accept the tariff revisions
related to the Transmission Interconnection Procedures (and corresponding tariff revisions to
Attachments S and X to the OATT) described in Parts II.A through II.D and included in
Attachments III, IV, VII, and VIII with an effective date of March 20, 2018 so that they would
only be applied prospectively (on and after that effective date) to new Transmission
Interconnection Applications and Interconnection Requests submitted after that date.55 The
acceptance of a March 20, 2018 effective date would not prejudice any market participants
currently in the NYISO’s interconnection queue and, in fact, would mitigate against potential
prejudice to certain market participants with projects currently pending in the NYISO’s
interconnection queue that, absent that effective date, could arguably be subject to new or
different interconnection requirements if required to transition from Attachment P to Attachment
X in order to comply with the changes if there was an effective date earlier than the date of this
filing.56
54 Id. at P 7.
55 Since the filing of the March 22, 2016 compliance filing and the September 13, 2016
compliance filing, the NYISO undertook a substantial and comprehensive interconnection process
improvement initiative, which the Commission accepted for filing with an effective date of December 19,
2017. See New York Independent System Operator, Inc., Letter Order, Docket No. ER18-80-000
(December 7, 2017) (“December 2017 Order”). As certain tariff provisions impacted by the February
2018 Order were deleted or significantly altered by the NYISO’s revisions accepted by the December
2017 Order, the revisions herein would only be clear for market participants with a prospective effective
date.
56 Specifically, one project in the interconnection queue—Queue No. 430—is a proposed
transmission upgrade that has been evaluated under Attachment P, is completing a Facilities Study under
Attachment P, and will proceed to a Transmission Interconnection Agreement under Attachment P. The
NYISO’s proposed revisions to the definition of “Merchant Transmission Facility” and “Class Year
Transmission Project,” if applied to existing projects in the interconnection queue, could arguably require
the Queue No. 430 project to initiate an Interconnection Request under Attachment X and proceed
through all of the interconnection studies in Attachment X, simply because the project is requesting CRIS
associated with its project. While not currently eligible for CRIS, and, therefore, not within the four
corners of the definition of “Class Year Transmission Project,” Queue No. 430 is being evaluated in the
current Class Year Study for CRIS, as a result of a Commission waiver in Docket No. ER17-505-000.
See H.Q. Energy Services (U.S.) Inc., FERC Docket No. ER17-505-000; Order Granting Tariff Waiver,
58 FERC ¶ 61,098 (2017). As to not prejudice the Queue No. 430 project, the NYISO, therefore,
Honorable Kimberly D. Bose March 19, 2018
Page 15
VII. COMMUNICATIONS
All communications and correspondence regarding this filing should be directed to:
Robert E. Fernandez, General Counsel
Raymond Stalter, Director, Regulatory Affairs Karen G. Gach, Deputy General Counsel *Carl F. Patka, Assistant General Counsel *Sara B. Keegan, Senior Attorney
*Brian R. Hodgdon, Attorney
New York Independent System Operator, Inc.
10 Krey Boulevard
Rensselaer, NY 12144
Tel: (518) 356-6000
Fax: (518) 356-4702
rfernandez@nyiso.com
rstalter@nyiso.com
kgach@nyiso.com
cpatka@nyiso.com
skeegan@nyiso.com
bhodgdon@nyiso.com
*Persons designated to receive service
VIII. DOCUMENTS SUBMITTED
*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 Messonnier57
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 NYISO OATT, effective April 1,
2016 (“Attachment I”);
2.A blacklined version of the proposed revisions to the NYISO OATT, effective
April 1, 2016 (“Attachment II”);
3.A clean version of the proposed revisions to the NYISO OATT, effective March
20, 2018 (“Attachment III”);
proposes that the revisions related to the new “Class Year Transmission Project” definition apply only to interconnection projects submitting applications or requests for interconnection after the requested March 20, 2018 effective date.
57 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 March 19, 2018
Page 16
4.A blacklined version of the proposed revisions to the NYISO OATT, effective
March 20, 2018 (“Attachment IV”);
5.A clean version of the proposed revisions to the NYISO Services Tariff, effective
April 1, 2016 (“Attachment V”);
6.A blacklined version of the proposed revisions to the NYISO Services Tariff,
effective April 1, 2016 (“Attachment VI”);
7.A clean version of the proposed revisions to the NYISO Services Tariff, effective
March 20, 2018 (“Attachment VII”);
8.A blacklined version of the proposed revisions to the NYISO Services Tariff,
effective March 20, 2018 (“Attachment VIII”);
9.A clean version of the proposed revisions to the NYISO Services Tariff effective
December 13, 2016 (“Attachment IX”);58 and
10.A clean version of the proposed revisions to the NYISO OATT effective October
18, 2017 (“Attachment X”).59
IX.SERVICE
The NYISO will send an electronic link to 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 to the New
Jersey Board of Public Utilities. In addition, the complete filing will be posted on the NYISO’s
website at www.nyiso.com.
58 Services Tariff Section 3.5 was filed on March 17, 2016 and November 29, 2016 in Docket No. ER16-1213.
59 OATT Sections 31.2.8-31.2.13 and 31.7 were filed on August 18, 2017 in Docket No. ER17-
2327.
Honorable Kimberly D. Bose March 19, 2018
Page 17
X.CONCLUSION
WHEREFORE, the New York Independent System Operator, Inc. requests that the
Commission accept this compliance filing without requiring any modifications, and determine
that the NYISO has fully complied with the directives in the February 2018 Order and Rehearing
Order.
Respectfully submitted,
/s/ Brian R. Hodgdon
Carl F. Patka, Assistant General Counsel Sara B. Keegan, Senior Attorney
Brian R. Hodgdon, Attorney
New York Independent System Operator, Inc.
cc:Anna Cochrane
James Danly
Jette Gebhart
Kurt Longo
David Morenoff
Daniel Nowak
Larry Parkinson
J. Arnold Quinn
Douglas Roe
Kathleen Schnorf Gary Will
