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Richard V. Kowalski/Monica Gonzalez

Richard V. Kowalski/Monica Gonzalez. Process Associated with the Elective Interconnection to, and Expansion/Upgrade of, the PTF. Elective Transmission Upgrade Process Improvement - Update. APRIL 22, 2014 TC meeting. Overview. Background

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Richard V. Kowalski/Monica Gonzalez

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  1. Richard V. Kowalski/Monica Gonzalez Process Associated with the Elective Interconnection to,andExpansion/Upgrade of, the PTF Elective Transmission Upgrade Process Improvement - Update APRIL 22, 2014 TC meeting

  2. Overview • Background • Reasons for improving the current Elective Transmission Upgrade (“ETU”) process • High level aspects of the proposal under development / consideration • General process • Interconnection service • Other process mechanics • Next steps

  3. Background: What is an ETU? • ISO Tariff definitions: • Elective Transmission Upgrade is a Transmission Upgrade that is participant-funded (i.e., voluntarily funded by an entity or entities that have agreed to pay for all of the costs of such Transmission Upgrade), and is not: (i) a Generator Interconnection Related Upgrade; (ii) a Reliability Transmission Upgrade (including a NEMA Upgrade, as appropriate); (iii) an Market Efficiency Transmission Upgrade (including a NEMA Upgrade, as appropriate) (iv) a Public Policy Upgrade; or (v) A project initially proposed in an Elective Transmission Upgrade Application filed with the ISO, in accordance with Section II.47.5, on a date after the addition or modification already has been otherwise identified in the current Regional System Plan (other than as an Elective Transmission Upgrade) in publication as of the date of that application • Transmission Upgrade(s) means an upgrade, modification or addition to the PTF that becomes subject to the terms and conditions of the OATT governing rates and service on the PTF on or after January 1, 2004. This categorization and cost allocation of Transmission Upgrades shall be as provided for in Schedule 12 of the OATT

  4. Background: The Current ETU Process • The process applicable to proposed ETUs is set out in Section II.47.5 of the ISO Tariff • It is the process that is used: • By any entity proposing to (i) interconnect a transmission facility to the Pool Transmission Facilities (“PTF”) or (ii) expand/upgrade the PTF as provided in Section II.47.5; • By an Eligible Customer specifically requesting the ISO conduct a System Impact Study pursuant to a Through or Out Service request under Section II.34 of the ISO Tariff; and • By any entity proposing to conduct an Economic Study that did not fall within the three identified requests to be performed in a given year under Attachment K of the ISO OATT

  5. Background: Current ETU Process Overview • The ETU process essentially entails the following steps:

  6. Reasons for Improving the Current ETU Process • The ISO reviewed the current ETU process and identified three primary deficiencies: • The process itself lacks specificity, which creates uncertainty for ETU applicants • The process steps differ from those set out for generator interconnections, which results in proposed ETUs being in a constant “free-fall” situation from an interconnection queue and study perspective • Generator Interconnection Studies cannot be delayed for ETU-related studies • Generator Interconnection Studies’ base cases do not account for an ETU until the ETU achieves I.3.9 approval • Generators are subject to withdrawal from the Queue if not actively moving through the interconnection process. ETUs being in constant “free-fall” do not have the same incentive to actively move through the process • The rights and obligations of an ETU differ from those available to generators • The ISO OATT does not provide for ETU interconnection service; ETUs just receive the right/approval to interconnect to the system

  7. Objectives of the ETU Process Improvements • To address the deficiencies in the current ETU process, the ISO has been developing a more comprehensive, robust process that will address the interconnection of participant-funded transmission facilities to the PTF and the elective expansion/upgrade of the PTF • The process will: • Account for all forms of participant-funded transmission facilities and develop clear rules as to the level of service and associated rights and obligations available for each “type” of ETU request, such as: • Participant-funded PTF enhancements for reasons other than generator interconnection; • Interconnection of participant-funded transmission facilities to the PTF

  8. Objectives of the ETU Process Improvements – Continued • Provide ETUs comparable treatment to generators; e.g.,: • Apply similar interconnection rights and obligations • Different labels/definitions, but same intent • Establish meaningful queue position • ETU can secure a sustainable capacity or energy interconnection service • May use a limited long-lead type of process to hold service until CSO is obtained • Provide for the interconnection of a transmission facility so that it can be operated and administered in a manner that is consistent with the ISO Tariff, including the existing Market Rules, the OATT and applicable operating practices • ExternalETUs must operate in the same manner as similarly situated facilities (e.g., PTF, Merchant Transmission Facility (“MTF”) or Other Transmission Facility (“OTF”)) • InternalETUs must operate in the same manner as PTF (i.e., no physical rights recognized)

  9. High Level Proposal Under Development to Achieve Objectives: General Process • Develop a new OATT schedule that is specific to ETUs • Based on the existing Schedule 22 – Large Generator Interconnection Process/Agreement; and • Recognize the interconnection of participant-funded transmission facilities to the PTF and the elective expansion/upgrade of the PTF • Process will use the same construct as the generator interconnection process:

  10. High Level Proposal Under Development to Achieve Objectives: General Process - Continued • However, the ETU process will: • Provide for an application and study construct that can account for the goals of the ETU applicant relative to the ETU interconnection service requested • E.g., A construct that generators can use as a complementary process to the generator interconnection process to identify PTF upgrades above those required for minimum interconnection • Provide for the completion of, as applicable: • A standardized transmission interconnection agreement • An operating agreement between ISO-NE and the transmission owner • An OATT Schedule for transmission service over the ETU • An assessment of impacts to Coordination Agreements

  11. High Level Proposal Under Consideration to Achieve Objectives: Other Process Mechanics • Consistent with the generator interconnection procedures, other process mechanism that are under consideration include: • Requirements for a valid and comprehensive ETU application to establish a meaningful queue position • Details regarding material modifications to an ETU application • Transitioning rules recognizing pending/existing ETUs • Identification of conforming changes to Market Rule 1 • FCM • Incorporation of ETU capacity- and energy-related interconnection service definitions and concepts • Other? • Other Market rules (?)

  12. High Level Proposal Under Consideration to Achieve Objectives: Transition Plan • All ETUs that have already applied and are not in service will need to conform to the updated process • Will provide for a transition timeframe • Will transition to “next stage” of the process, based on current status • Will recognize deposits already received

  13. Next Steps • ISO will continue development of the ETU process proposal and the associated OATT and Market Rule 1 changes • Changes will be coordinated with the PTOs • Proposed OATT changes will be presented to stakeholders at future Transmission Committee meetings • Tentative schedule for filing in late 2014 • For comments/questions, contact: • Rich Kowalski (rkowalski@iso-ne.com), 413-535-4127 • Cheryl Ruell (cruell@iso-ne.com), 413-540-4219

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