HUNTON & WILLIAMS LLP
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TED J. MURPHY
DIRECT DIAL: 202 • 955 • 1588
EMAIL: tmurphy@hunton.com
January 25, 2011FILE NO: 55430.000063
Ms. Kimberly D. Bose Secretary
Federal Energy Regulatory Commission 888 First Street, NE
Washington, DC 20426
Re: New York Independent System Operator, Inc., Compliance Filing and Request for
Commission Action by April 1, 2011, Docket No. ER10-3043-001
In compliance with the Commission’s November 26, 2010 Order on Proposed
Revisions to In-City Buyer Side Mitigation Measures (“November Order”)1 the New York
Independent System Operator, Inc. (“NYISO”) respectfully submits this filing to revise
Attachment H to the NYISO’s Market Administration and Control Area Services Tariff
(“Services Tariff”). This compliance filing addresses the Commission’s remaining2
directives regarding the NYISO’s September 27, 2010 filing3 proposing revisions to the
NYISO’s “Buyer Side Mitigation” provisions for the Installed Capacity (“ICAP”) market in
New York City (“In-City”) (“September Filing”). As directed, the NYISO proposes to revise
the Offer Floor duration methodologies and make a minor modification to the Offer Floor
exemption process, and, thus in accordance with the Commission’s November Order, the
revisions would be effective November 27, 2010, which also is consistent with the effective
date of the other tariff provisions that were accepted in the November Order.
Finally, the NYISO respectfully requests that the Commission issue an order accepting
the compliance tariff revisions included in this filing, and the Initial Compliance Filing,4 no
1 New York Independent System Operator, Inc., 133 FERC ¶ 61,178 (2010) (“November
Order”).
2 As discussed further in Section II, the NYISO submitted an initial compliance filing to address one issue on December 7, 2010. See New York Independent System Operator, Inc., Initial Compliance Filing, Docket No. ER10-3043-001 (filed December 7, 2010).
3 New York Independent System Operator, Inc., Proposed Enhancements to In-City BuyerSide Capacity Mitigation Measures, Docket No. ER10-3043-000 (filed September 27, 2010)
(“September Filing”).
4 See Section II and n. 14.
ATLANTA AUSTIN BANGKOK BEIJING BRUSSELS CHARLOTTE DALLAS HOUSTON LONDON LOS ANGELES
McLEAN MIAMI NEW YORK NORFOLK RALEIGH RICHMOND SAN FRANCISCO WASHINGTON
www.hunton.com
Ms. Kimberly D. Bose, Secretary January 25, 2011
Page 2
later than April 1, 2011. Commission action by that date will provide greater certainty to both the NYISO and to its Market Participants and will facilitate the NYISO’s orderly
implementation of its Buyer Side Mitigation Measures in advance of the 2011 Summer
Capability Period.
I.LIST OF DOCUMENTS SUBMITTED
The NYISO submits the following documents:
1. This filing letter;
2. A clean version of the modifications to Attachment H to the Services Tariff
(Attachment I); and
3. A blacklined version of the modifications to Attachment H to the Services Tariff
(Attachment II).
II.BACKGROUND
The NYISO’s September Filing proposed enhancements to Attachment H’s provisions
governing In-City Buyer Side Mitigation. The September Filing proposed changes to the
Offer Floor5 duration calculation methodology as follows: (1) modify the existing “period of
years” formula to use a forecast of future load growth rather than the prior three years of
actual load growth;6 (2) add a second methodology which would eliminate the Offer Floor
when an Installed Capacity Supplier’s total number of MW that cleared in the In-City ICAP
Spot Market Auction exceeds its nominal Unforced Capacity (“UCAP”), during months when
at least fifty percent of its Capacity cleared;7 and (3) add a thirty Capability Period maximum
Offer Floor duration.8 The NYISO also proposed several improvements to the Offer Floor
exemption process.9
5 Terms with initial capitalization not otherwise defined herein shall have the meaning
specified in Article 2 of the Services Tariff, in Section 23.2.1 of Attachment H thereto, or in Section
25.1.2 of Attachment S to the NYISO’s Open Access Transmission Tariff (“OATT”) as applicable.
6 September Filing at 7.
7 Id.
8 Id. at 6.
9 The revisions included changes to: (1) clarify which entities may receive Offer Floor
exemptions; (2) clarify information submission requirements and the consequences of non-
Ms. Kimberly D. Bose, Secretary January 25, 2011
Page 3
On November 26, 2010, the Commission issued an order on the September Filing, directing the following revisions: (1) elimination of the modified Offer Floor duration methodology based on a period of years;10 (2) elimination of the existing six Capability Period minimum and newly proposed thirty Capability Period maximum Offer Floor
durations;11 (3) modification of the second Offer Floor duration methodology;12 and (4) addition of a reference to the “ISO Procedures” in section 23.4.7.3.3.
The Commission also directed the NYISO to better justify or delete the proposed tariff
provision that assumes, for purposes of the mitigation exemption determination, a start date of
three years after a project’s Class Year.13 The NYISO submitted an Initial Compliance Filing
to address this issue on December 7, 2010 in Docket No. ER10-3043.14 The November Order
accepted the proposed tariff provisions, as modified by the Commission, effective November
27, 2010. 15
III.DESCRIPTION OF PROPOSED TARIFF REVISIONS
A.Modifications to the Offer Floor Duration Methodologies
The November Order accepted in part and rejected in part the NYISO’s proposed
revisions to the Offer Floor duration methodologies, directing the NYISO to delete the
modified Offer Floor duration methodology that was based on the existing period of years
formula16 and the minimum and maximum Offer Floor duration periods.17 With respect to
the Offer Floor duration methodology based on an Installed Capacity Supplier’s cleared
compliance; (3) clarify and update the timetable for conduction exemption analyses and disclosing results; and (4) improve the Offer Floor exemption analysis.
10 November Order at PP 47, 48, 52.
11 Id. at PP 47, 51, 52.
12 Id. at PP 47, 49, 52.
13 Id. at P 73.
14 That filing is currently pending. See New York Independent System Operator, Inc., Initial Compliance Filing, Docket No. ER10-3043-001 (filed December 7, 2010).
15 November Order at P 1.
16 Id. at P 48.
17 Id. at P 51.
Ms. Kimberly D. Bose, Secretary January 25, 2011
Page 4
UCAP, the Commission found it reasonable, because it based the duration of the Offer Floor “on actual acceptance of the resource’s capacity in the market at the offer floor,” but directed the NYISO to delete the “Fifty Percent Rule.”18 The Commission further directed the NYISO to modify the methodology to provide that “the offer floor mitigation will be lifted only for the minimum percentage portion of a supplier’s resource capacity that has cleared in 12, notnecessarily-consecutive, monthly auctions.”19
In compliance with the November Order, the NYISO has modified Section 23.4.5.7 to delete the modified period of years formula, delete the Offer Floor minimum and maximum duration, and revise the accepted Offer Floor exemption methodology as follows:
Unless exempt as specified below, offers to supply Unforced Capacity in an
ICAP Spot Market Auction from an In-City Installed Capacity Supplier: (i)
shall equal or exceed the applicable Offer Floor; and (ii) can only be offered in
the ICAP Spot Market Auctions. The Offer Floors shall apply to offers for
Unforced Capacity from the Installed Capacity Supplier, if it is not a Special
Case Resource, for a minimum of each of the six Capability Periods starting
with the Capability Period for which the Installed Capacity Supplier first offers
to supply UCAP; (“Initial Capability Period”), or the lesser of the number of
Capability Periods if a positive number greater than six (6) that is determined
in the following three ways: (a) the number determined by (1) the initial
DMNC value of the Installed Capacity Supplier plus the amount of Surplus
Capacity at the time the Installed Capacity Supplier first offers to supply
UCAP, divided by (2) the forecast average annual growth in MW for the New
York City Locality over the six Capability Periods beginning with the Initial
Capability Period with such forecast growth as identified in the Load and
Capacity Data (Gold Book), (b) thirty (30) Capability Periods (including the
Initial Capability Period), and (c)the final Capability Period determined as the
Capability Period in which the Total Cleared UCAP is greater than the Total
Nominal UCAP, with Total Nominal UCAP determined using the utilized in
the Interconnection Facilities Study, or if an Interconnection Facilities Study is
not required, the MW value the proposed Generator identified to the
Transmission Owner to which it proposed to interconnect, multiplied by one
minus the NERC class average Equivalent Demand Forced Outage Rate, to
18 Id. at P 49.
19 Id.
Ms. Kimberly D. Bose, Secretary January 25, 2011
Page 5
determine the initial nominal UCAP value for the Generator (“Nominal
UCAP”), and then computing the product of twelve (12) and the Nominal
UCAP, and Total Cleared UCAP equal to the cumulative amount of the
Installed Capacity Supplier’s Cleared UCAP, with Cleared UCAP equal to the
Installed Capacity Supplier’s offers of UCAP that are accepted in a New York
City ICAP Spot Market Auction (in whole MW, rounded down)provided,
however, that portion of a resource’s UCAP (rounded down to the nearest tenth
of a MW) that has cleared for any twelve, not-necessarily-consecutive, months
shall cease to be subject to the Offer Floor requirement., provided that each
such amount is equal to or greater than fifty percent (50%) of the initial
DMNC value of the Installed Capacity Supplier. If the foregoing calculation
extends mitigation to part of a Capability Period, the entire Capability Period
shall be subject to an Offer Floor. The initial DMNC value of the Installed
Capacity Supplier shall be determined as specified in the ISO tariffs and ISO
Procedures.
In compliance with the Commission’s directive, the NYISO’s modifications revise the Offer Floor duration methodology to provide that only the Installed Capacity that clears in twelve, not-necessarily-consecutive, months will cease to be subject to the Offer Floor. Because the Commission directed the NYISO to delete the modified period of years formula and the proposed Fifty Percent Rule, the NYISO has also deleted the tariff language regarding the determination of the initial DMNC values, which is no longer needed.
B. Modification to the Offer Floor Exemption Process Revisions
The Commission accepted most of the NYISO’s proposed modifications to the Offer
Floor Exemption process, but directed a minor modification to the NYISO’s data submission
provisions. The Commission accepted Section 23.4.5.7.3.3, but directed the NYISO to
include a reference to the “ISO Procedures” similar to the reference found in Section
23.4.5.7.5, regarding data response requirements for Special Case Resources. The NYISO, therefore, proposes to modify Section 23.4.5.7.3.3 as follows:
All developers, Interconnection Customers, and Installed Capacity Suppliers for any Examined Facility that does not request CRIS shall provide data and information requested by the ISO by the date specified by the ISO, in
accordance with the ISO Procedures.
Ms. Kimberly D. Bose, Secretary January 25, 2011
Page 6
IV.PROPOSED EFFECTIVE DATE AND REQUEST FOR COMMISSION
ACTION BY APRIL 1, 2011
The November Order states that the “Commission accepts in part and rejects in part
the proposed tariff provisions, effective November 27, 2010, subject to the conditions of this
order.”20 Accordingly, the NYISO requests that the Commission accept these revisions as
satisfying the conditions of the November Order, with an effective date of November 27,
2010.
The NYISO also requests that the Commission issue an order by April 1, 2011
accepting the proposed tariff revisions. This will provide greater certainty to both the NYISO and its Market Participants and facilitate the NYISO’s orderly implementation of its Buyer Side Mitigation Measures in advance of the 2011 Summer Capability Period.
V.SERVICE
This filing will be posted on the NYISO’s website at www.nyiso.com. In addition, the
NYISO will e-mail an electronic link to this filing to the official representative of each party
to this proceeding, to 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.
VI.CONCLUSION
Wherefore, for the foregoing reasons, the New York Independent System Operator, Inc. respectfully requests that the Commission accept this compliance filing effective
November 27, 2010.
Respectfully submitted,
/s/Ted J. Murphy____________________
Ted J. Murphy
Counsel to
the New York Independent System Operator, Inc.
20 November Order at P 1.
CERTIFICATE OF SERVICE
I hereby certify that I have on this day served the foregoing document on the official service
lists compiled by the Secretary in these proceedings. I have also electronically served the
foregoing on all market participants, on each participant in its stakeholder committees, on the
New York State Public Service Commission, and on the electric utility regulatory agency of
New Jersey.
Dated at Albany, NY, this 25th day of January 2011.
/s/ Joy A. Zimberlin
Joy A. Zimberlin
New York Independent System Operator, Inc
10 Krey Blvd
Rensselaer, NY 12114 (518) 356-6207
