HUNTON & WILLIAMS LLP
1900 K STREET, N.W.

WASHINGTON, D.C. 20006-1109

TEL202 • 955 • 1500

FAX202 • 778 • 2201

TED J. MURPHY

DIRECT DIAL: 202 • 955 • 1588
EMAIL: tmurphy@hunton.com

July 6, 2010FILE NO: 55430.000072

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, Docket Nos.
ER09-1142-___, RM05-15-017, ER10-_____

Dear Ms. Bose:

Pursuant to the Federal Energy Regulatory Commission’s (“Commission”) June 4,

2010 order in the above captioned proceeding (“June 4 Order”),1 and the Commission’s

directives in Order No. 676-F,2 the New York Independent System Operator, Inc. (“NYISO”)
respectfully submits this compliance filing. This filing includes proposed compliance
revisions to the NYISO’s Market Administration and Control Area Services Tariff (“Services
Tariff”): (1) to satisfy the June 4 Order’s directives with respect to the NYISO’s list of “traffic
ticket” violations in Attachment O of the Market Administration and Control Area Services
Tariff (“Services Tariff”); and (2) to incorporate by reference the Phase I Measurement and
Verification (“M&V”) business practice standards developed by the North American Energy
Standard Board’s (“NAESB”) Wholesale Electric Quadrant (“WEQ”) into its Open Access
Transmission Tariff (“OATT”) and Services Tariff, as directed by the Commission in Order
No. 676-F. The NYISO also requests waiver of the Order No. 614 filing requirements to the
extent necessary to make the proposed language effective prior to June 30, 2010 (i.e., the
effective date of the NYISO’s baseline eTariff).

1 New York Independent System Operator, Inc., 131 FERC ¶ 61,225 (2010) (“June 4 Order”).

2 Standards for Business Practices and Communication Protocols for Public Utilities, Order No. 676-F,

75 Fed. Reg. 20901 (April 22, 2010), 131 FERC ¶ 61,022 (2010).

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 July 6, 2010

Page 2

I.Documents submitted

1. This filing letter;

2. Clean and Redline Attachment O Services Tariff Sheets reflecting the proposed
changes (“Attachment I”);

3. Clean and Redline Services Tariff Sheets reflecting the proposed changes to
Section 5.1.2.6 (“Attachment II”); and

4. Clean and Redline OATT Sheets reflecting the proposed changes to Section 2.17
(“Attachment III”).

II.Communications

Copies of correspondence concerning this filing should be served on:

Robert E. Fernandez, General Counsel Carl F. Patka, Senior Attorney

*Alex Schnell

New York Independent System Operator, Inc.

10 Krey Boulevard

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

aschnell@nyiso.com

*Ted J. Murphy
Vanessa A. Colón

Hunton & Williams LLP 1900 K Street, NW

Suite 1200

Washington, DC 20006-1109 Tel: (202) 955-1500

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

Ms. Kimberly D. Bose, Secretary July 6, 2010

Page 3

Additionally, the Commission rejected item (16), failure to comply with

creditworthiness requirements, because it found the NYISO did not provide tariff references
for the conduct or the sanction.3 The NYISO, therefore, proposes to modify the proposed
language that it submitted on February 18, 2010, to address the Commission’s concern by
specifying the relevant tariff provisions. The NYISO proposes the following revised
language:

failure of a Market Party to comply with the ISO’s creditworthiness requirements set
forth in Attachment K of the ISO Services Tariff, or other action, that triggers
sanctions under Section 7.5 of the ISO Services Tariff or Section 2.7.5 of the ISO
OATT, specifically for customers, including, but not limited to, failure to: (i) failure
of a Market Party to make timely payment under Section 7.2.2 of the ISO Services
Tariff or Section 2.7.3.2 of the ISO OATT that triggers a sanction under Sections

7.5.3(i) or 7.5.3(iv) of the ISO Services Tariff or Sections 2.7.5.3(i), 2.7.5.3(iv), or

2.7.5.4 of the ISO OATT;comply with a demand for additional credit support, (ii)

failure of a Market Party to comply with a demand for additional credit support under
Article 26.5 of Attachment K to the ISO Services Tariff that triggers a sanction under
Section 7.5.3(i) of the ISO Services Tariff or Section 2.7.5.3(i) of the ISO OATTcure
a default in another independent system operator/regional transmission organization
market; (iii) failure of a Market Party to cure a default in another ISO/RTO market
under Sections 7.5.3(iii) of the ISO Services Tariff, or Sections 2.7.5.3(iii) of the ISO
OATT that triggers a sanction under of those tariff provisionsprepay for charges in
accordance with the terms of a prepayment agreement; (iv) failure of a Market Party
that has entered into a Prepayment Agreement with the ISO under Appendix K-1 to
Attachment K to the ISO Services Tariff to make payment in accordance with the

terms of the Prepayment Agreement that triggers a sanction under the Prepayment
Agreement or 7.5.3(i) of the ISO Services Tariff comply with the ISO’s
creditworthiness reporting requirements; and (v) failure of a Market Party to make
timely payment on two occasions within a rolling twelve month period under Section

7.5.3(iv) of the ISO Services Tariff, or Section 2.7.5.3(iv) of the ISO OATT that

triggers a sanction under either of those provisionsprovide sufficient credit support to cover bid submissions.

The June 4 Order stated that the NYISO could either remove the rejected items or propose

modifications,4 but the Commission did not specifically indicate that the NYISO could

propose modified tariff language for item (16).5 However, because the Commission generally

3 June 4 Order at P 26.

4 Id. at P 17.

5 Id. at p 26

Ms. Kimberly D. Bose, Secretary July 6, 2010

Page 4

directed the NYISO to either remove or propose modifications to the rejected items, the

NYISO submits that the Commission should accept the NYISO’s proposed change to item

(16) as complying with the June 4 Order. The NYISO requests clarification of this issue in its contemporaneously submitted Request for Rehearing and Clarification.

The NYISO requests that the Commission accept these proposed modifications for filing effective as of January 1, 2010, the effective date the June 4 Order accepted for the proposed tariff modifications.6

Additionally, the NYISO is revising OATT Section 2.7, Billing and Payment, to

correct the numbering on one item referred to in the proposed tariff language above.

Specifically, the NYISO is correcting the numbering for the section titled “Notice to

Transmission Customers” from 2.7.5.1 to 2.7.5.4. The Commission has previously accepted such ministerial corrections in compliance filings.7

B. Modifications to Comply with Order No. 676-F

Order No. 676-F requires public utilities to modify their tariffs to incorporate by

reference the new Phase I M&V Standards. The Phase I M&V Standards categorize various demand response products and services and support the measurement and verification of these products and services in wholesale electric energy markets.8 Order No. 676-F directed public utilities to include tariff language to incorporate the Phase I M&V Standards into their tariffs, in their next unrelated tariff filing.9

In compliance with Order No. 676-F, the NYISO proposes to modify section 2.17 of the OATT and section 5.1.2.6 of the Services Tariff to include the following language:

Measurement and Verification of Wholesale Electricity Demand Response (WEQ-015, 2008 Annual Plan Item 5(a), March 16, 2009).

The NYISO respectfully requests that the Commission accept for filing these proposed
modifications effective as of May 24, 2010, the effective date of the Phase I M&V Standards.

IV. Request for Waiver of Order No. 614 Filing Requirements

6 Id. at P 1.

7 See, e.g., New York Independent System Operator, Inc., 125 FERC ¶ 61,206 (2008), reh’g, 127 FERC ¶ 61,042 (2009) (accepting proposed tariff revisions necessary to correct drafting errors or ambiguities).

8 Order No. 676-F at P 1.

9 Id. at P 44.

Ms. Kimberly D. Bose, Secretary July 6, 2010

Page 5

Given that the requested effective dates (i.e., January 1, 2010 and May 24, 2010) of
the proposed compliance language precedes the eTariff baseline date of June 30, 2010, the
NYISO is requesting a waiver of the of the requirements that it provide a paper version of the
tariff sheets as they would have been filed under Order No. 614. The attached clean and
redlined files comply with Order No. 719 and incorporate the changes directed by the
Commission’s order in the instant docket. However, should the Commission wish to
complete the “paper” record, the NYISO can provide those sheets upon request.

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 electric utility regulatory agency of New Jersey. In
addition, the complete filing will be posted on the NYISO’s website at www.nyiso.com.

VI.Conclusion

Wherefore, for the foregoing reasons, the New York Independent System Operator,
Inc. respectfully requests that the Commission accept this filing to be effective as specified
above.

Respectfully submitted,

/s/Ted J. Murphy____________________

Ted J. Murphy

Counsel to

the New York Independent System Operator, Inc.

CERTIFICATE OF SERVICE

I hereby certify that I have this day served the foregoing document upon each person designated on the official service list compiled by the Secretary in this proceeding in
accordance with the requirements of Rule 2010 of the Rules of Practice and Procedure, 18
C.F.R. §385.2010.

Dated at Rensselaer, NY this 6th day of July, 2010

/s/ Joy A. Zimberlin

Joy Zimberlin

New York Independent System Operator, Inc

10 Krey Blvd

Rensselaer, NY 12114 (518) 356-6207

55430.000072 EMF_US 31477670v1