July 13, 2018

By Electronic Delivery

Honorable Kimberly D. Bose, Secretary Federal Energy Regulatory Commission 888 First Street, NE

Washington, DC 20426

Re: Filing of an Executed Amended and Restated Operating Agreement Between the
New York Independent System Operator, Inc. and New York Transco, LLC;
Request for Waiver of the 60-Day Notice Period; Docket No. ER18-___-000

Dear Ms. Bose:

Pursuant to Section 205 of the Federal Power Act,1 the New York Independent System Operator, Inc. (“NYISO”) hereby submits for filing an executed Amended and Restated
Operating Agreement (“Amended Agreement”) entered into between the NYISO and the New York Transco, LLC (“Transco”). The Amended Agreement is labeled as Service Agreement No. 2271 under the NYISO’s Open Access Transmission Tariff (“OATT”).

The NYISO respectfully requests that the Commission accept the Amended Agreement for filing. The Amended Agreement conforms to the NYISO’s pro forma Operating Agreement for non-incumbent transmission owners (“NTOs”) that is contained in Section 31.11 of
Attachment Y of the OATT (“Pro Forma Agreement”), with the exception of the limited non-
conforming revisions described in Part I of this letter and the non-conforming revisions that were previously accepted by the Commission for the prior version of this agreement. Further, as
described in Part II of this letter, the NYISO respectfully requests a waiver of the Commission’s prior notice requirements2 to make the Amended Agreement effective as of May 23, 2016, which is the effective date of the prior version of the agreement.

I.Discussion

A.Background

The Amended Agreement supersedes the operating agreement between the NYISO and
Transco that was filed with the Commission in Docket No. ER16-1785 on May 25, 2016 (“Initial
Agreement”).3 At the time the Initial Agreement was executed, the Commission had not yet

1 16 U.S.C. § 824d (2016).

2 See Prior Notice and Filing Requirements Under Part II of the Federal Power Act, 64 FERC ¶ 61,139, clarified, 65 FERC ¶ 61,081 (1993).

3 The NYISO re-filed the Initial Agreement on May 26, 2016, to correct the set of attachments included with the filing letter.

10 Krey Boulevard, Rensselaer, New York 12144 | www.nyiso.com

Honorable Kimberly D. Bose July 13, 2018

Page 2

accepted the Pro Forma Agreement that the NYISO submitted on March 22, 2016 in its Order No. 1000 regional compliance proceeding in Docket No. ER13-102.

The NYISO and Transco, an NTO, were required to execute the Initial Agreement prior
to the Commission’s acceptance of the Pro Forma Agreement to provide for an operating
agreement between the parties when a portfolio of the Transco’s transmission upgrade projects
entered into service. For this reason, the NYISO and Transco inserted a new Article 6.15 in the
Initial Agreement stating that the parties would amend the Initial Agreement to incorporate any
modifications to the then-pending Pro Forma Agreement directed by the Commission in Docket
No. ER13-102. Article 6.15 provided that the parties would promptly file an amended
agreement after the issuance of a Commission order directing any modifications to the Pro
Forma Agreement. The Commission accepted the Initial Agreement on July 29, 2016, including
Article 6.15 and certain other non-conforming modifications to the then-pending Pro Forma
Agreement.4

B.Amendments to Conform Initial Agreement with Modified Pro Forma

Agreement

The NYISO submitted the Pro Forma Agreement for the Commission’s acceptance in its March 22, 2016, Order No. 1000 regional compliance filing in Docket No. ER13-102-009.5 The NYISO subsequently submitted modifications to the Pro Forma Agreement: (i) in a September
13, 2016, compliance filing in Docket No. ER13-102-011 to set forth the rights and obligations of an NTO as a Responsible Transmission Owner that may be required to submit a regulated
backstop solution in the NYISO’s reliability planning process in accordance with Attachment Y of the OATT;6 and (ii) in a September 20, 2016, compliance filing in Docket No. ER16-120-003 to set forth the rights and obligations of an NTO as a Responsible Transmission Owner that may be required to submit a regulated solution in the NYISO’s Generator Deactivation Process in
accordance with Attachment FF of the OATT.7

On February 15, 2018, the Commission issued an order accepting in large part the Pro

Forma Agreement.8 The Commission directed the NYISO to make a small number of additional

4 See New York Independent System Operator, Inc., Letter Order, Docket No. ER16-1785 (July 19, 2016).

5 New York Independent System Operator, Inc., Compliance Filing, Docket No. ER13-102-009 (March 22, 2016). The NYISO subsequently submitted an errata filing that corrected two inadvertent errors in the Pro Forma Agreement. New York Independent System Operator, Inc., Errata Correcting Compliance Filing, Docket No. ER13-
102-010 (May 24, 2016).

6 New York Independent System Operator, Inc., Compliance Filing, Docket No. ER13-102-011 (September 13, 2016).

7 New York Independent System Operator, Inc., Compliance Filing, Docket No. ER16-120-003 (September 20, 2016). These revisions to the Pro Forma Agreement were accepted in a November 16, 2017, order. See New York Independent System Operator, Inc., Order on Compliance and Rehearing, 161 FERC ¶ 61,189 at P 11 (2017) (“November 2017 Order”).

8 New York Independent System Operator, Inc., Order Conditionally Accepting Tariff Revisions and Requiring Further Compliance, 162 FERC ¶ 61,107 at PP 122-123 (2018) (“February 2018 Order”).

Honorable Kimberly D. Bose July 13, 2018

Page 3

revisions to the Pro Forma Agreement.9 The NYISO submitted these revisions in a compliance filing on March 19, 2018,10 which revisions were accepted by the Commission in a letter order on June 5, 2018.11

Pursuant to Articles 6.14 and 6.15 of the Initial Agreement, the NYISO and Transco have
entered into the Amended Agreement, which was fully executed on July 10, 2018. The
Amended Agreement aligns the Transco’s operating agreement with the current Pro Forma
Agreement, with the exception of those limited non-conforming revisions described below and
those non-conforming revisions that the parties agreed to, and the Commission accepted, for the
Initial Agreement.

i. Revisions to Reflect Modifications to Pro Forma Agreement

As revised, the Amended Agreement includes the modifications to the Pro Forma
Agreement that arose after the execution of the Initial Agreement. These include: (i) the
NYISO’s modifications to the Pro Forma Agreement included in its September 13, 2016,
compliance filing in Docket No. ER13-102-011 that were accepted by the Commission in its
February 2018 order;12 (ii) the NYISO’s modifications to the Pro Forma Agreement included in
its September 20, 2016, compliance filing in Docket No. ER16-120-003 that were accepted by
the Commission in a November 16, 2017, order;13 and (iii) the NYISO’s revisions to the Pro
Forma Agreement included in its March 19, 2018, compliance filing in Docket No. ER13-102-
012 to address the Commission’s directives in its February 2018 order that were accepted in a
June 5, 2018, letter order.14

These revisions are located in the preamble of the Amended Agreement, along with

Articles 2.02, 2.07, 2.08, 2.10, 2.13, 3.01, 3.05, 3.08, 4.01, 5.01, 5.02, 6.01, 6.02, 6.03, 6.10, and

6.14. In addition, the parties made modifications to reflect that this is an “Amended and

Restated Agreement.” The parties also corrected the Service Agreement number in the heading
of certain pages of the Amended Agreement to state Service Agreement No. 2271, rather than
2771.

9 Id. at P 123.

10 New York Independent System Operator, Inc., Compliance Filing, Docket No. ER13-102-012 (March 19, 2018). The NYISO subsequently submitted an errata filing on May 2, 2018 to correct the inadvertent exclusion from the Pro Forma Agreement of the revisions to the agreement accepted by the Commission in its November 2017 Order in Docket No. ER16-120-003. New York Independent System Operator, Inc., Refiling of Tariff Section to Correct Ministerial Error, Docket No. ER13-102-014 (May 2, 2018).

11 See New York Independent System Operator, Inc., Letter Order, Docket Nos. ER13-102-012, 013, and 014 (June 5, 2018) (“June 2018 Letter Order”).

12 See February 2018 Order at P 122.

13 See November 2017 Order at P 11.

14 See June 2018 Letter Order.

Honorable Kimberly D. Bose July 13, 2018

Page 4

ii. Revisions to Remove Article 6.15

On June 5, 2018, the Commission issued a letter order accepting the NYISO’s final

compliance filing in its Order No. 1000 regional compliance proceeding in Docket No. ER13-
102.15 As the Commission has issued a final order and no request for rehearing has been timely
submitted, the Pro Forma Agreement is not subject to further modification in Docket No. ER13-
102. Accordingly, the parties have agreed to remove Articles 6.15. The non-conforming
provision is no longer required as there will be no further modifications to the Pro Forma
Agreement in Docket No. ER13-102 that must be reflected in the parties’ operating agreement.16

iii. Corrections to Pro Forma Agreement

In the course of developing the Amended Agreement, the NYISO and Transco identified
a few minor wording issues in the Pro Forma Agreement. In Section 2.13(c)(1), the NYISO and
Transco agreed to insert the missing word “be” in the first sentence. The parties also agreed to
replace the word “covered” with “recovered” in the second sentence in Section 3.08(f). Finally,
the parties made the word “Obligations” singular in the Table of Contents to mirror the heading
for Section 2.12 of the agreement. If the Commission accepts for filing these revisions in the
Amended Agreement, the NYISO will make these revisions to the proposed Pro Forma

Agreement in a future compliance filing as directed by the Commission or in a Section 205

filing, as appropriate. In the meantime, the NYISO will tender and apply this revised terms

equally to any other NTO by proposing them as a non-conforming revisions in future operating agreements. The Commission has previously accepted non-conforming clarifications to the Pro Forma Agreement.17

iv. Effective Date

As described in Part II below, the NYISO requests an effective date of May 23, 2016 for the Amended Agreement. The parties have revised Article 6.01 of the Amended Agreement to reflect that May 23, 2016 is the effective date of the agreement.

II. Proposed Effective Date and Request for Wavier of the 60-Day Notice Period

The NYISO requests an effective date of May 23, 2016, for the Amended Agreement,
which is the effective date accepted by the Commission for the Initial Agreement. Article 6.15
of the Initial Agreement provides that any modifications to the operating agreement between the
NYISO and Transco to comply with the changes to the Pro Forma Agreement in Docket No.
ER13-102 “shall be effective back to the effective date of this Agreement.” Consistent with this
requirement, the NYISO respectfully requests that the Commission waive its prior notice

15 See id.

16 The parties also made a related conforming change to revert the non-conforming title of Article 6.14 from “Modification Generally” back to “Modification” as set forth in the Pro Forma Agreement.

17 See New York Independent System Operator, Inc., Letter Order, Docket No. ER16-1785 (July 19, 2016) (accepting Initial Agreement with certain non-conforming clarifications to the Pro Forma Agreement).

Robert E. Fernandez, General Counsel
Karen Georgenson Gach, Deputy General Counsel
Raymond Stalter, Director Regulatory Affairs
*Carl F. Patka, Assistant General Counsel
New York Independent System Operator, Inc.

10 Krey Boulevard

Rensselaer, NY 12144
Tel: (518) 356-6000
Fax: (518) 356-4702
rfernandez@nyiso.com
kgach@nyiso.com

cpatka@nyiso.com

*Designated to receive service.
IV. Documents Submitted

*Ted J. Murphy

Hunton Andrews Kurth LLP 2200 Pennsylvania Avenue, NW Washington, D.C. 20037
Tel: (202) 955-1500

Fax: (202) 778-2201
tmurphy@huntonAK.com

*Michael J. Messonnier Jr. Hunton Andrews Kurth LLP 951 East Byrd Street

Richmond, VA 23219
Tel: (804) 788-8200
Fax: (804) 344-7999

mmessonnier@huntonAK.com

The NYISO submits the following documents with this filing letter:

• A clean version of the Amended Agreement (Attachment I);

• A blacklined version of the Amended Agreement showing the changes from the
Initial Agreement (Attachment II); and

• The signature pages for the Amended Agreement (Attachment III).

V.Service

The NYISO will send an electronic link to this filing 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, a complete

18 The NYISO respectfully requests waiver of 18 C.F.R. § 385.203(b)(3) (2014) to permit service on counsel in both Washington, D.C. and Richmond, VA.

Honorable Kimberly D. Bose July 13, 2018

Page 6

copy of the documents included with this filing will be posted on the NYISO’s website at
www.nyiso.com.

VI. Conclusion

Wherefore, the NYISO respectfully requests that the Commission accept the Amended Agreement for filing with an effective date of May 23, 2016.

Respectfully submitted,

/s/ Carl F. Patka

Carl F. Patka

Assistant General Counsel

New York Independent System Operator, Inc.

cc:Anna Cochrane

James Danly
Jignasa Gadani
Jette Gebhart
Kurt Longo

David Morenoff
Daniel Nowak
Larry Parkinson
Douglas Roe

Kathleen Schnorf Gary Will