On October 31, 2012, FERC conditionally approved the New York Independent System Operator, Inc.’s (“NYISO”) August 31, 2012 proposed tariff revisions to address concerns with Black Start and System Restoration Services (“Restoration Services”), effective November 1, 2012. The Commission found NYISO’s proposed tariff revisions were a “reasonable step” towards meeting concerns regarding black start service adequacy, and requested one area of modification by NYISO on compliance.
NYISO’s Market Administration and Control Area Services Tariff (“Services Tariff”) includes a plan to restore the New York Control Area (“NYCA”) bulk power system in the event of a blackout. In its August 31 filing, NYISO proposed changes to its Services Tariff and Open Access Transmission Tariff (“OATT”) to address compensation, testing requirements, and commitment terms for Restoration Services providers.
NYISO’s Plan includes local transmission owner restoration plans in two categories: (1) the Con Edison Plan; and (2) all other local restoration plans. First, NYISO proposed minor changes to its Services Tariff to state that Restoration Services are provided under the NYISO Plan or an individual transmission owner’s Restoration Plan. NYISO further proposed changes to clarify that customers shall pay for Restoration Services based on their share of the supply of load in NYCA not used to supply station power as a third party provider.
Second, with regard to NYISO’s Con Edison Plan, NYISO proposed to have Con Edison designate, on an individual basis, gas and steam turbine units necessary to implement the Con Edison Plan. NYISO further proposed that the compensation method for Restoration Services under the Con Edison Plan would follow the ISO New England, Inc. (“ISO NE”) approach, which compensates generators for incremental costs associated with adding Restoration Services capability to generating units. NYISO explained that proxy costs based on ISO NE amounts would be adjusted to reflect costs in New York City. NYISO also proposed to include tariff language that a generator shall have the right to file a proposed rate for the recovery of its actual incremental costs of providing services under section 206 of the Federal Power Act if its actual incremental costs exceed payment. The Commission rejected this language and ordered NYISO on compliance to remove the reference to section 206, with the understanding that the generator will not have an additional burden to show the existing tariff is unjust and unreasonable. The Commission clarified that on compliance, the Services Tariff should reflect that NYISO will file jointly with the generator for a tariff change reflecting the generator’s unit-specific rate.
Finally, in response to concerns from generators, NYISO also proposed to modify Con Edison Plan testing criteria for steam turbine units that provide Restoration Services, subjecting these units to “full start-up tests” once every three years, with an “intervening year test” in the other two years. NYISO also proposed a 30-day grace period for generators following a failed test. Finally, NYISO proposed to stagger commitment periods so that generators could potentially withdraw from the Con Edison Plan in groups, and proposed to increase the advanced notice of withdrawal requirement to two years.
A copy of the Commission’s Order is available here.