Elective Transmission Upgrade Process Improvements Design

Transmission Committee Meeting

SEPTEMBER 23, 2014

Monica GonzalezSENIOR REGULATORY COUNSEL

Rich KowalskiDIRECTOR, TRANSMISSION STRATEGY & SERVICES

Purpose of Today’s Presentation

• At the RC/TC Summer Meeting, the ISO discussed the objective and scope of the Elective Transmission Upgrade Process Enhancement Project (ETU Project) and provided background necessary to establish a common understanding about the existing rules to facilitate the ETU Project discussions.

• With that common understanding established, today, we are presenting the ETU Project design that will form the basis for the revisions to the Open Access Transmission Tariff (OATT).

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• What the ETU Project Will Do

• Basic Rules for the ETU Project Design

• Refine the ETU Definition

• New OATT ETU Schedule

• Interconnection Process Comparison

• ETU Interconnection Services

• Additional Design Elements Related to CNIIS*

• ETU Operation in ISO Markets

• Queue Position Rules

• Transition Rules

• Summary

• Next Steps

* Capacity Network Import Interconnection Service3

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Basic Rules for the ETU Project Design

• The ETU Project relies on the ISO Tariff structure that is already in place– The fundamental structure of the ISO Markets, Transmission Service, &

Operations will remain unchanged

• ETUs will be treated in the same manner as similarly-situated transmission facilities and will need to fit within one of the following categories:– Pool Transmission Facility (PTF) – Merchant Transmission Facility (MTF)– Other Transmission Facility (OTF)

• PTF, OTF and MTF facilities will be operated the same as they are today:– Physical priority rights will not be recognized over PTF and internal

transmission facilities– Scheduling of External Transactions will remain the same for existing ties

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Refine the ETU Definition

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Internal ETU

External ETU

A transmission facility with interconnection points

located solely within the New England Control Area

A transmission facility that will interconnect the New England Control Area with

another control area

• The ETU Project will clarify the definition of ETU and create two categories of ETUs: internal and external

New OATT ETU Schedule

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Interconnection Process Comparison

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GENERATOR(SCH 22)

ETU (II.47.5 - Today)

ETU (NEW SCHEDULE)

REQUIREMENTS TO INITIATE THE PROCESS

Complete IR $50,000 deposit Proof of Site Control

if capacity or $10,000 if energy and no Site Control

All required technical data

Complete Application $2,500 administration

fee

Complete IR* $50,000 deposit Proof of Site Control: (i)

required for the source & sink or an additional $10,000 deposit; (ii) not required for ETU IRs that describe a general objective; instead requires an additional $10,000 deposit

All required technical data specific to the nature of the ETU request

QUEUE POSITION

Certain Queue PositionUsed for study order and cost allocation

Uncertain Queue PositionIn constant free-fall until such time as I.3.9 approval is achieved

Certain Queue PositionUsed for study order and cost allocation

*Internal ETU IRs between PTF & Non-PTF will require a concurrent application to the applicable PTO through their Schedule 21 process for the Non-PTF connection. External ETU IRs will require a request to the other control area through their applicable process.

Interconnection Process Comparison - continued

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GENERATOR(SCH 22)

ETU (II.47.5 - Today)

ETU (NEW SCHEDULE)

STUDIES Need to respect:Earlier queued generatorsETUs with I.3.9 approvalIncludes: Feasibility Study, System Impact Study, Facilities StudyStudies performed by ISO (or at the direction of ISO)

Need to respect:Earlier queued generatorsETUs with I.3.9 approvalNew generators that enter the queue after the ETU and start their studies prior to the ETU studies & I.3.9 being completeIncludes: System Impact Study & Facility StudyStudies performed by ISO, ITO or Affected TO or ETU developer’s consultant under NDA

Will respect:Earlier queued generators & ETUsWill Include: Feasibility Study, System Impact Study, Facilities Study**Studies performed by ISO (or at the direction of ISO)

*Changes will be required to Schedules 22/23 such that earlier queued generators and ETUs are respected**A Facilities Study is required unless an Engineering & Procurement Agreement is pursued

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Interconnection Process Comparison - continued

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GENERATOR

(SCHEDULE 22)ETU

(II.47.5 - Today)ETU

(NEW SCHEDULE)

MATERIAL MODIFICATIONS

Rules to assess project modifications

No rules to assess project modifications

Rules to assess project modifications

AGREEMENTS

3-Party Interconnection Agreements with ISO, Interconnecting Transmission Owner (“ITO”) & Interconnection Customer (“IC”)

Interconnection Agreements with Affected Transmission Owners (ISO not a Party)

Support Agreements with Affected Transmission Owners (ISO not a Party)

3-Party Interconnection Agreements with ISO, ITO & IC, if applicable

Other agreements (e.g., Coordination, TOA, OATT service schedule, if applicable) may need to be in place before the ETU can become commercial

MILESTONES Monitoring of Major

Milestones to assure project is moving forward

No milestones or monitoring

Monitoring of Major Milestones to assure project is moving forward

• For certain ETU types, the ETU schedule will define ETU-specific interconnection services similar to the services available to generators:– Network Import Interconnection Service (NIIS): Comparable to a

generator’s Network Resource Interconnection Service for energy– Capacity Network Import Interconnection Service (CNIIS):

Comparable to a generator’s Capacity Network Resource Interconnection Service (CNRIS) for capacity & energy

• ETU CNIIS and NIIS structure is comparable to generator CNRIS and NRIS, except that:– CNIIS and NIIS are assigned to the ETU, not a generator

• ETU must complete interconnection process milestones & achieve commercial operation to receive NIIS

• ETU must complete interconnection process & FCM-specific milestones & achieve commercial operation to receive CNIIS

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ETU Interconnection Services - continued

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Additional Design Elements Related to CNIIS

• External ETUs eligible to request CNIIS will be:– Subject to CNR Group Study– Afforded the opportunity to request long lead treatment at the

time of the interconnection request• This structure allows an ETU with a long-lead construction

schedule to be considered existing for study purposes before CNIIS is secured

• Rules for ETU long lead treatment will parallel the existing design for generators (e.g., deposits, CPS monitoring & other requirements)

– Incorporated into the existing FCM conditional qualification provisions under the Tariff

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• Consistent with the basic design rules, ETUs will be operated by the ISO as follows:– Internal ETUs – without recognition of physical priority rights and

consistent with capabilities to facilitate Security Constrained Economic Dispatch

– External ETUs (PTF or non-controllable OTF/MTF) – without recognition of physical priority rights and consistent with capabilities to facilitate Security Constrained Economic Dispatch

– External ETUs (controllable OTF/MTF) – with recognition of physical rights for use of the transmission facility consistent with the corresponding OATT schedule approved by FERC and consistent with Security Constrained Economic Dispatch

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Queue Position Rules

• The new ETU schedule will include Queue Position (QP) rules that will determine study order and cost allocation, as is the case for generators, under the existing single queue construct.

• With the ability to establish meaningful QP, Internal ETUs will be able to facilitate an associated internal generator(s) realization of CNRIS and NRIS in the generator interconnection process.

• When the Internal ETU and the associated generator are at different QPs, the QP of the Internal ETU will be used to determine the order in which the ETU and the associated generator(s) is (are) included in the CNR Group Study only, as follows: – A generator that is not associated with an ETU will be studied in its

respective queue order– A generator and its associated ETU will be studied at the lower of the

generator’s or its associated ETU’s queue position

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Queue Order Study Order

Gen 1 Gen 1

ETU 2

Gen 3 Gen 3 & ETU 2 

Gen 4

ETU 5 Gen 4 & ETU 5 

Gen 6

ETU 7  

Gen 8 Gen 8 

Gen 9 Gen 9 & ETU 7

ETU 10 Gen 6 & ETU 10

Queue Position Rules - Example

• Currently, ETUs that are pending in the queue do not have a firm Queue Position; therefore, transition rules are necessary to address how pending ETUs will establish a meaningful QP.

• QP adjustments for pending ETU requests will be made on the Effective Date of the ETU Project (as requested in the filing) revisions based on progress:

– ETUs with I.3.9 approval will be given a:• New QP based on the date of their I.3.9 Approval Letter; and • Separate additional QP placeholder, located at the bottom of the queue in

relative queue order, for the ETU to submit a new ETU IR for CNIIS– ETUs without I.3.9 approval will be:

• Assigned a meaningful QP at the bottom of the queue (below the separate additional QP placeholder for ETUs with I.3.9 approval) and in relative queue order based on their System Impact Study Agreement (SISA) execution status and study status (active vs. inactive)

• Following QP adjustments, studies may need to be updated to reflect the revised queue

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Earlier queued

Later queued

ETUs with I.3.9 approvalETUs with I.3.9 approval

ETUs w/o I.3.9 approval: Without executed SISA

ETUs w/o I.3.9 approval: Without executed SISA

ETUs w/o I.3.9 approval:Executed SISA/inactive

study

ETUs w/o I.3.9 approval:Executed SISA/inactive

study

ETUs w/o I.3.9 approval:Executed SISA/active study

ETUs w/o I.3.9 approval:Executed SISA/active study

ETUs with I.3.9 approvalETUs with I.3.9 approval

ETUs w/o I.3.9 approval:Without executed SISA

ETUs w/o I.3.9 approval:Without executed SISA

ETUs w/o I.3.9 approval:Executed SISA/inactive

study

ETUs w/o I.3.9 approval:Executed SISA/inactive

study

ETUs with I.3.9 approval:Placeholder for CNIIS IR

ETUs with I.3.9 approval:Placeholder for CNIIS IR

ETUs w/o I.3.9 approval:Executed SISA/active study

ETUs w/o I.3.9 approval:Executed SISA/active study

Queuebottom

New QP based date of

I.3.9 Approval Letter CNIIS IR

Placeholder

All ETUs w/o I.3.9 approval will be assigned a new meaningful QP at bottom

of queue in relative queue order & re-ordered based on process progress

Studies may need to be updated to reflect the

revised queue

CURRENT FUTURE

• After the ETU Project Effective Date , ETUs will have a 60-day transition period to meet specific requirements or will be withdrawn from the queue

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ETUs with I.3.9 Approval & Executed 2-Party IA

ETUs with I.3.9 Approval & without Executed IA

ETUs without I.3.9 Approval

• Submit new ETU CNIIS IR with applicable deposit to support the QP placeholder, if desired

• Comply with all ISO Tariff requirements before achieving commercial operation status (e.g., OA, OATT service schedule)

• Submit new ETU CNIIS IR with applicable deposit to support the QP placeholder, if desired

• Enter into a Facilities Study Agreement or an Engineering & Procurement Agreement

• True-up to the new ETU interconnection deposit

• Submit a new IR & true-up to the new ETU interconnection deposit

• Provide all requested data to ISO to take over direction/completion of the study under the new ETU schedule

• Enter into a SISA with the ISO if do not have an executed SISA

Summary

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