By Michael Kuser

FERC ruled Thursday that NYISO must make additional changes to comply with Order 1000, while acknowledging in a separate docket that it erred in directing the ISO to change the indemnification language in its pro forma development agreement.

The commission said transmission developers must indemnify NYISO except for acts of “gross negligence or intentional misconduct.” In ordering NYISO to remove the word “gross” from the agreement, the commission said it failed to follow its precedent in a 2015 order involving MISO (ER15-2059-002; ER13-102-008).

FERC also granted NYISO a request for clarification, saying it will allow the ISO to propose a new process for evaluating alternative regulated transmission solutions and regulated backstop solutions for interconnection. The ISO’s current process is outlined in Tariff Attachments X and S.

But the commission rejected rehearing requests by the New York Transmission Owners (NYTOs), who balked at the commission’s requirement that TOs responsible for providing “backstop” solutions to a reliability need — normally the incumbent TO — sign the development agreement, as is required of nonincumbent transmission developers.

“If responsible transmission owners developing regulated backstop solutions are not required to execute a development agreement, they will have an advantage over nonincumbent transmission developers both in seeking selection in the regional transmission plan for purposes of cost allocation and remaining selected,” the commission said, noting that the NYISO Transmission Owners Agreement and the agreement between NYISO and the NYTOs on the Comprehensive Planning Process for Reliability Needs are less stringent than those in the development agreement

The NYTOs consist of Central Hudson Gas & Electric; Consolidated Edison; New York Power Authority; New York State Electric and Gas; Niagara Mohawk Power; Long Island Power Authority; Rochester Gas & Electric; and Orange and Rockland Utilities.

Compliance Filings

FERC also provided its clarification on alternatives to Attachments X and S in a concurrently issued order in which it accepted in part Order 1000 compliance filings NYISO made in March and September 2016. The commission accepted most of the ISO’s Tariff revisions but rejected language it said was discriminatory or unjust (ER13-102, et al.).

It ordered the ISO to make changes in its proposed transmission interconnection procedures that it found unjust and unreasonable, including language on scheduling and definitions.

It also required the ISO to make changes in its proposed Operating Agreement regarding maintenance schedules, compliance with local reliability rules and investigations of equipment malfunctions.

The commission found “incorrect” the Tariff revision that said nothing in Attachment Y affects a TO’s right to recover the costs of upgrades to its facilities regardless of whether the upgrade has been selected in the regional transmission plan for purposes of cost allocation.

“Pursuant to Order No. 1000, once NYISO selects a transmission project in the regional transmission plan for purposes of cost allocation, the regional cost allocation method set forth in Attachment Y of the [Tariff] applies, unless the project developer ‘decline[s] to pursue regional cost allocation,’” the commission said.