Subject: Generator Retirement ProcedureDeactivation Process and Gap Solution Process
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1 NEW YORK INDEPENDENT SYSTEM OPERATOR TECHNICAL BULLETIN 185 5/29/2009, revised , , recertified 9/13/11, mm/dd/16 Subject: ProcedureDeactivation Process and Gap Solution Process This Technical Bulletin explainssummarizes the process by whichnyiso s Generator Operators notifydeactivation Process and Gap Solution Process for the NYISOReliability Planning Process (RPP) as set forth in Section of their intent to retire a generator, per the New York State Public Service Commission (PSC) order in Case 05-E Proceeding on MotionAttachment Y of the Commission to Establish Policies and Procedures Regarding Generation Unit Retirements.Open Access Transmission Tariff (OATT). Details: In PSC Case No. 05-E The NYISO recently filed a Reliability Must Run (RMR) compliance filing with the Federal Energy Regulatory Commission (FERC). The compliance filing proposed revisions to the Reliability Planning Process addressing, among other things, the Generator Deactivation and Gap Solution processes and requested an effective date of October 20, This Technical Bulletin summarizes several of the principal obligations and requirements included in the revised Generator Deactivation and Gap Solution processes. Generators, Transmission Owners, Developers and Market Participants must review the relevant provisions of the Tariffs and other authority cited herein to ensure their full understanding of the NYISO processes and of their responsibilities. (1) Generator Deactivation Notice A Generator must provide the NYISO with a minimum of 365 days notice before it may be Retired or enter into a Mothball Outage. 2 The Generator must follow the instructions for submitting the Generator Deactivation Notice Form set forth in Section of Attachment Y and its submission must include the information required to satisfy the informational requirements contained in Section of Attachment Y of the Open Access Transmission Tariff (OATT). If the Generator intends to deactivate in greater than 365 days, it must specify its proposed later deactivation date in its notice. If the Generator is interested in deactivating in less than 365 days (provided that the NYISO does not identify a Reliability Need that would result from the deactivation), the Generator must indicate this interest in its notice. The 365-day period will begin to run on the Generator Deactivation Assessment Start Date, which is the date that the NYISO issues a written notice indicating that the Generator Deactivation Notice and associated informational submissions are sufficiently complete for the NYISO to commence its review. If the Initiating Generator has entered into an ICAP Ineligible Forced Outage (IIFO), the Generator Deactivation Assessment Start Date is the date that the Generator entered into the IIFO state. Such Generator must provide the NYISO with the information required by Section of Attachment Y within twenty days of entering the IIFO state, consistent with Section of the Market Administration and Control Area Service Tariff (Services Tariff). 1 NYISO s Compliance Filing to Establish Reliability Must Run (RMR) Tariff Provisions (Oct. 19, 2015) is available at: 2 Section of Attachment Y. The purpose of this Technical Bulletin is to facilitate participation in the NYISO by communicating various NYISO concepts, techniques, and processes to Market Participants before they can be formally documented in a NYISO manual. The information contained in this bulletin is subject to change as a result of a revision to the ISO Tariffs or a subsequent filed tariff with the FERC. NYISO Customer Support Page 1 of 5
2 All notices that Generator Deactivation Notices are complete will be posted to the NYISO s web page under Planning. Generators remain separately responsible for satisfying any state law or regulatory requirements concerning their deactivation, including advance notice requirements to the NYPSC and transmission and distribution utilities as set forth in Proceeding on Motion of the Commission to Establish Policies and Procedures Regarding Generation Unit Retirements, the PSC Case 05-E-0889, Order Adopting Notice Requirements for Generation Unit Retirements (issued an Order requiring that generators subject to PSC jurisdiction greater than 2 MW should provide notification of their intent to retire their generator. The PSC order states that "(g)enerators proposing to retire are required to serve their notice on our (PSC) Secretary, the NYISO, and any affected T&D utility. 3 " TheDecember 20, 2005) ( PSC Order ). Generator Owner isowners are requested to forward a copy of the respective generator's retirementany deactivation letter to the PSCsubmitted to the PSC, which differs from or is in addition to the NYISO s Generator Deactivation Notice pursuant to of Attachment Y, to the NYISO at: generator_retirement@nyiso.com. The length of the time period for notification depends upon the size of the generator. See Table 1 below for a chart of lead-time versus generator size, as defined by the PSC order: Such deactivation letters submitted to the PSC will be posted to NYISO s web page under Planning. Table 1: Notification Lead-Times Generator Size Lead Time for Notification 2 MW N/A > 2 MW, but less than 80 MW 90 Days 80 MW 180 Days The PSC Order further states that "we request that the NYISO notify its market participants of any retirement notices it receives, in order to apprise those potentially-affected parties. The NYISO is issuing this Technical Bulletin to assist Market Participants in providing their generator retirement notification to the NYISO. The NYISO is also requesting notification of generator retirements from generators pursuant to Section 3.5 of the Services Tariff, which states that: (2) "Customers shall inform the ISO, in accordance with the ISO procedures, of the Availability of Generators within the NYCA subject to a Customer s control by Energy contract, ownership or otherwise.... Suppliers will provide Generator Deactivation Assessment Following the Generator Deactivation Assessment Start Date, the NYISO will perform, in coordination with the Responsible Transmission Owner(s) (TO(s)), a Generator Deactivation Assessment to determine the impact on reliability of the Initiating Generator s deactivation as set forth in Section of Attachment Y. As a part of the Generator Deactivation Assessment, the Responsible TO(s) will perform the necessary reliability studies to review the impact on the reliability of the non- Bulk Power Transmission Facilities that are part of the New York State Transmission System. The results of the Generator Deactivation Assessment, which will identify whether a Reliability Need is expected to arise, will be posted on the NYISO s web page under Planning. 3 The Order did not apply to generators owned by the New York Power Authority (NYPA) or the Long Island Power Authority (LIPA), but NYPA and LIPA may voluntarily provide the notifications called for in the Order. NYISO Customer Support Page 2 of 5
3 (3) Generator Deactivation If the Generator Deactivation Assessment does not identify a Reliability Need, an Initiating Generator that has indicated an interest in an early deactivation in its Generator Deactivation Notice may be Retired or enter into a Mothball Outage consistent with Section of Attachment Y. Otherwise, a Generator that satisfies the requirements to be Retired or enter into a Mothball Outage may do so within 365 days of: (i) the conclusion of the 365-day notice period or (ii) the later date specified in its Generator Deactivation Notice. 4 If the Generator is not Retired or has not entered into a Mothball Outage within this time period, it must begin the Generator Deactivation process anew to be Retired or to enter into a Mothball Outage. 5 Generators are also required to provide specific data to the NYISO as set forth in Section 3.5 of the Services Tariff regarding their deactivation. They must provide, among other information: data on Generator status and output including maintenance schedules, Generator scheduled return dates (inclusive of return to service from maintenance, forced outages or partial unit outagesoutage that resulted in significant reduction in a generating unit s ability to produce Energy in any hour), and Generator machine data, in accordance with the ISO Procedures. These data shall also include Generator Incremental/Decremental Bids, operating limits, response rates, megawatt, megavar and voltage readings.". Notification provided in accordance with this Technical Bulletin will be promptly forwarded to all necessary departments within the NYISO to communicate a prospective generator retirement. If the NYISO requires additional technical information to perform the A Market Party is required reliability analyses from the generator, the respective NYISO department will contact the generator. Accordingly once communicated to the NYISO, the NYISO will also post the generator notice as received to its Planning web page at: Finally, this Technical Bulletin requires generators to to confirm the retiremententry of their unitsits Generator into a Retired or Mothball Outage state, so that the NYISO can timely update its data.market Information System. At least five business days in advance, or as soon as practicable before the actual retirement date, each generatordate that the Generator actually enters into a Retired or Mothball Outage state, each Generator shall contact its NYISO Customer Relations representative to confirm the retirementits change of the unit or units and associated changes to the NYISO s Market Information System; provided, however, that the NYISO status. The NYISO shall not be obligated to reflect the unit retirement in NYISOits systems the entry of the Generator into a Retired or Mothball Outage state on or before the date of the actual unit retirementchange of status if the notice of retirementsuch confirmation is received by the NYISO fewer than five business days in advance of the actual unit retirement. The NYISO shall as soon as practicable but not later than five business days of receiving notice of the actual unit retirement date reflect the unit retirement in NYISO systems. Once the generator is retired, the NYISO will send a final notice of retirement to its MP TIE distribution list. When a Market Participant provides notice of a generator retirement to all interested parties, the Market Participant also shall provide notice to the NYISO via the following address: generator_retirement@nyiso.com. The Market Participant shall attach to the a PDF copy of the generator retirement notification letter it provided to the PSC. The letter will be posted to the NYISO s website as described above. 4 See Section of Attachment Y. 5 Id. See also Section of Attachment Y. NYISO Customer Support Page 3 of 5
4 Nothing in this Technical Bulletin alters the responsibility of generators for all bids ingenerators to submit Bids to the extent required under the NYISO s Market Information SystemTariffs. Considerations: When retiring a generator, the Market Participant should consider the following as it proceeds in the generator retirement: 1. Day Ahead Market Bidding The Market Services Tariff sets forth certain requirements for generators to offer capacity. The NYISO Market Monitoring Unit will continue to monitor offers until the day of the respective generator s retirement. If a generator fails to comply with the Market Services Tariff, including Attachment H, the Market Participant may be subject to financial sanctions as described in the NYISO Market Services Tariff, Section , ICAP Manual, Sections 4.8 and 6, and Services Tariff Attachment H. 2. ICAP Market The NYISO ICAP Market permits generators to sell their capacity into the market many months ahead of time. When sold into the ICAP market, this capacity is a commitment from the Market Participant to the NYISO, and it is expected that the quantity of capacity will be available for the period sold. If a generator certified capacity from the unit in an ICAP Auction and it will not be available for the entire period, then the generator may be subject to an ICAP deficiency charge, as described in the NYISO Market Services Tariff, sections and A Market Participant has various options available to it to reduce its exposure to potential ICAP deficiency charges. These options include purchasing capacity in the monthly auctions or through a bilateral transaction to satisfy its obligation to provide capacity in accordance with its sale of capacity from the retired generator. (4) Commencement of Gap Solution Process In the event that a Reliability Need cannot be timely addressed through the biennial Reliability Needs Assessment (RNA) or Comprehensive Reliability Planning (CRP) processes, the NYISO will commence the Gap Solution process to address the need as set forth in Section of Attachment Y. (5) Solicitation of Gap Solution Proposals If a Reliability Need requiring a Gap Solution is identified, the NYISO will solicit proposed Gap Solutions and/or market-based solutions from Responsible TO(s) and Developers. Pursuant to Section of Attachment Y, the Responsible TO(s) must submit a Gap Solution proposal, together with a conceptual permanent solution, and any other Developer may propose a Gap Solution to address the Reliability Need. 6 In proposing a Gap Solution, Developer(s) must submit the information required in Section of Attachment Y and Attachment C of the RPP Manual. All Developers Gap Solution proposals must be submitted within thirty days of the NYISO s solicitation for solutions if the Reliability Need was identified as a result of a Generator Deactivation Assessment. 6 A Developer seeking to propose a transmission Gap solution must be determined to be qualified under Section of Attachment Y. NYISO Customer Support Page 4 of 5
5 In addition, if the NYISO determines that a Generator, which is in a Mothball Outage, an IIFO, or that has been mothballed under the pre-may 1, 2015 rules, may be capable of satisfying, in whole or in part, the identified Reliability Need, then the Generator will be notified that it is subject to review to assess whether it can satisfy the Reliability Need as a possible Gap Solution by providing service under an RMR agreement. Such a Generator shall provide the NYISO with the information required by Section of Attachment Y within twenty days of the issuance of the NYISO s notice. (6) RMR Agreements Pursuant to Sections and of Attachment Y, the NYISO may enter into an RMR Agreement with one or more Generators, if it determines such action is necessary to timely address a Reliability Need. The NYISO anticipates that the contents of this Technical Bulletin will be incorporated into the ICAPReliability Planning Process Manual during its next available recertification periodafter FERC rules on the NYISO s RMR Compliance Filing. NYISO Customer Support Page 5 of 5
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