Christopher J. Novak

Senior Counsel

December 23, 2019

The Honorable Kimberly D. Bose Secretary

Federal Energy Regulatory Commission 888 First Street, NE

Washington, DC 20426

Re: Niagara Mohawk Power Corporation
Docket No. ER20-____-000

Filing of Large Generator Interconnection Agreement with Covanta Niagara I, LLC

Dear Secretary Bose:

Pursuant to Section 205 of the Federal Power Act (“FPA”),1 and Part 35 of the
Federal Energy Regulatory Commission’s (“Commission”) regulations,2 Niagara
Mohawk Power Corporation (“Niagara Mohawk”) submits a Large Generator
Interconnection Agreement (“LGIA”) between Niagara Mohawk and Covanta Niagara I,
LLC (“Covanta Niagara”). The attached LGIA (the “Covanta Niagara LGIA”) is
designated as Service Agreement No. 2500 under the New York Independent System
Operator, Inc.’s (“NYISO”) Open Access Transmission Tariff (“OATT”).

The Covanta Niagara LGIA is an undisputed agreement between Niagara

Mohawk and Covanta Niagara for the continued provision of interconnection service to the generating facility owned by Covanta Niagara. Niagara Mohawk requests that the Commission accept the Covanta Niagara LGIA as of the effective date set forth therein, November 26, 2019.

I.Background

Niagara Mohawk is a public utility subject to the Commission’s jurisdiction that owns transmission facilities located in New York which have been placed under the operational control of the NYISO.

Covanta Niagara owns and operates a generating facility located in the Town of Niagara Falls, County of Niagara, New York that has a nominal installed capacity not to exceed 42,400 kilowatts and associated electric energy (the “Facility”).

Niagara Mohawk and Covanta Niagara are already parties to an interconnection
agreement for Niagara Mohawk to provide interconnection service to the Facility using

The Honorable Kimberly Bose December 23, 2019

Page 2

the transmission system owned by Niagara Mohawk (the “Prior Interconnection

Agreement”). The Commission accepted the Prior Interconnection Agreement for filing
effective as of December 30, 2014.3 Article 11.1 of the Prior Interconnection Agreement
states that it will continue in effect for five years (i.e., until December 29, 2019). Article

11.2 of the Prior Interconnection Agreement states that, upon expiration of that

agreement, if Covanta Niagara desires to remain interconnected to the transmission system thereafter, then the parties will enter into a new interconnection agreement consistent with the then-current NYISO pro forma LGIA.

II.The Covanta Niagara LGIA

Niagara Mohawk and Covanta Niagara have entered into the Covanta Niagara LGIA to provide for continued interconnection service to the Facility using the
transmission system owned by Niagara Mohawk, pursuant to the terms of the Covanta Niagara LGIA. The parties intend the Covanta Niagara LGIA to supersede the Prior
Interconnection Agreement effective as of November 26, 2019, as set forth in the
Covanta Niagara LGIA.4

With minor variations, the Covanta Niagara LGIA follows the pro forma NYISO LGIA set forth in Appendix 6 of Attachment X to the NYISO OATT. The main
difference between the Covanta Niagara LGIA and the pro forma NYISO LGIA is that the Covanta Niagara LGIA is a two-party agreement between the transmission owner
(Niagara Mohawk) and the generation facility owner (Covanta Niagara), whereas the pro forma NYISO LGIA is a three-party agreement among the transmission owner, the
generation facility owner, and the NYISO.5

Commission precedent supports acceptance of the Covanta Niagara LGIA as a

two-party agreement. In proceedings on two-party LGIAs between Niagara Mohawk and
generation subsidiaries of Alliance Energy that were modeled on the pro forma NYISO
LGIA (collectively, the “Alliance Energy LGIAs”),6 the Commission found that the
NYISO did not need to be a party to the two-party Alliance Energy LGIAs, for the
following reasons:

[T]hey are not the type of new generator interconnection agreements
envisioned by Order No. 2003; rather they are more like after-the-fact
interconnection operating agreements that govern the terms, conditions,
and rates associated with the continued operation and maintenance of
previously constructed facilities built to accommodate the interconnection

The Honorable Kimberly Bose December 23, 2019

Page 3

of the Alliance generators to Niagara Mohawk’s transmission system. Accordingly, we will not require NYISO to be a signatory to these unexecuted IAs.7

Like the Alliance Energy LGIAs, the Covanta Niagara LGIA is not a new generator interconnection agreement of the type envisioned by Order No. 2003. Instead, the
Covanta Niagara LGIA governs the terms, conditions, and rates associated with the continued operation and maintenance of the previously constructed facilities built to accommodate the interconnection of the existing Facility to the Niagara Mohawk
transmission system. Therefore, the Commission should accept the Covanta Niagara LGIA as a two-party agreement.

The pro forma NYISO LGIA contains a number of provisions that are applicable to new interconnections but are not applicable to existing interconnections, such as the interconnection of the Facility. However, Niagara Mohawk and Covanta Niagara have agreed to retain those provisions in the Covanta Niagara LGIA.8 This approach is
consistent with the approach authorized in PJM Interconnection, L.L.C.9 In that order, the Commission rejected a proposal to delete inapplicable provisions from an LGIA,
stating that “[i]f a provision of a contract is not applicable, it is not applicable,” and
concluding that “[u]nless confusion is likely, modifications to a pro forma agreement that ‘clarify’ matters not in doubt are not necessary.”10

Niagara Mohawk and Covanta Niagara have agreed to a twenty-year term for the
Covanta Niagara LGIA.11 Niagara Mohawk and Covanta Niagara have also included
clarifying provisions in the Covanta Niagara LGIA that differ from provisions in the pro
forma NYISO LGIA. In Article 27.2, the parties have agreed to have a third arbitrator
selected by the first two arbitrators chosen by the parties, because this is a two-party
agreement. In Article 27.4, the parties have changed the allocation of costs for a single
arbitrator from one-third per party to one-half per party, because the Covanta Niagara
LGIA is a two-party rather than a three-party agreement. Each of the Alliance Energy
LGIAs accepted by the Commission contained similar clarifying provisions. In new
Appendix G to the Covanta Niagara LGIA, the parties have clarified that, in accordance
with Article 10.5 of the Covanta Niagara LGIA, Covanta Niagara will be responsible for

omitted). The Commission also stated that “any interconnections involving the interconnection of a new
generating facility or involving increases in capacity or material modifications to the operating
characteristics of existing generating facilities interconnected to Niagara Mohawk’s or any other NYISO
member’s transmission system will require the NYISO to be a signatory to that IA.” Id. However, the
Facility is already interconnected to the transmission system owned by Niagara Mohawk, and there has
been no increase in capacity or material modifications to the operating characteristics of the Facility.
Therefore, the NYISO does not need to be a signatory to the Covanta Niagara LGIA.

The Honorable Kimberly Bose December 23, 2019

Page 4

all reasonable operation and maintenance expenses and will pay them as a fixed, ongoing
charge.

III.Effective Date

The Commission’s regulations require service agreements to be filed not more than 30 days after service under the agreements has commenced.12 As discussed above, the Covanta Niagara LGIA is intended to go into effect as of November 26, 2019, i.e., fewer than 30 days after the date the Covanta Niagara LGIA is being filed. Therefore, Niagara Mohawk requests that the Commission accept the Covanta Niagara LGIA
effective November 26, 2019.

IV.Documents Enclosed

In addition to this filing letter, attached are the following documents:

i.The Covanta Niagara LGIA (Service Agreement No. 2500 under the

NYISO OATT), provided in clean format (Attachment A)

ii.Black-lined revisions showing the differences between the Covanta

Niagara LGIA and the pro forma NYISO LGIA (Attachment B)

1218 C.F.R. § 35.3(a)(2).

The Honorable Kimberly Bose December 23, 2019

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V.Communications and Service

Communications regarding this filing should be addressed to the following

individuals, whose names should be entered on the official service list maintained by the

Secretary for this proceeding:

Christopher J. NovakSean Atkins

Senior CounselBradley R. Miliauskas

National Grid USAAlston & Bird LLP

Service Company, Inc.The Atlantic Building

40 Sylvan Road950 F Street, NW

Waltham, MA 02451Washington, DC 20004

(781) 907-2112(202) 239-3300

chris.novak@nationalgrid.comsean.atkins@alston.com

bradley.miliauskas@alston.com

Kathryn Cox-Arslan

Director, Commercial Services National Grid USA

40 Sylvan Road

Waltham, MA 02451 (781) 907-2406

kathryn.cox@nationalgrid.com

Copies of this filing have been served on Covanta Niagara, the NYISO, and the New York Public Service Commission.

VI.Conclusion

For the reasons stated herein, Niagara Mohawk respectfully requests that the
Commission accept the Covanta Niagara LGIA effective as of November 26, 2019.

Respectfully submitted,

/s/ Christopher J. Novak

Christopher J. Novak Senior Counsel

National Grid USA

Service Company, Inc.

40 Sylvan Road

Waltham, MA 02451

Attorney for Niagara Mohawk Power Corporation