Addressing Affected System Impacts of Generator Interconnection: Processes and Principles. Stakeholder Call August 23, :30 a.m. - 12:00 p.m.

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1 Addressing Affected System Impacts of Generator Interconnection: Processes and Principles Stakeholder Call August 23, :30 a.m. - 12:00 p.m.

2 1. Introduction Mercy Parker Helget Sr. Stakeholder Engagement and Policy Specialist Page 2

3 Agenda Time Topic Presenter 9:30-9:45 a.m. 1. Introduction Mercy Parker Helget 9:45-11:45 a.m. 2. Discussion: Processes and Principles Keith Johnson 11:45-12:00 p.m. 3. Next Steps Keith Johnson Page 3

4 Purpose of this initiative is to add detail to Business Practice Manual ( BPM ) regarding affected systems. ISO tariff currently addresses treatment of affected systems, but at a high level Additional clarity will improve generator interconnection process Purpose of today s call is to discuss processes and principles proposed to be incorporated in BPM Page 4

ISO tariff currently addresses treatment of affected systems, but at a high level

5 Stakeholders will have multiple opportunities over the next six months to provide input. Aug 5 Aug 23 Sept 12 Oct 9 Oct 30 Nov 20 Dec 11 After Dec 11 & Jan 2014 ISO posts first paper Stakeholder conference call Stakeholder written comments due ISO posts second paper, includes BPM language Stakeholder conference call Stakeholder written comments due Proposed language put in BPM change management process Stakeholders will have two additional opportunities to provide input during BPM process Page 5

Stakeholder written comments due ISO posts second paper, includes BPM language Stakeholder conference call Stakeholder

6 2. Discussion Processes and Principles Keith Johnson Manager, Infrastructure Policy Page 6

7 The ISO has worked with affected systems for years and developed ways to address interconnections. Worked under variety of interconnection circumstances and developed processes and principles to address impacts of generator interconnections Purpose of this initiative is to present these principles and processes to stakeholders for consideration and eventual incorporation into ISO s BPM Page 7

address impacts of generator interconnections Purpose of this initiative is to present these

8 There are a few key terms that will be used throughout our discussion today. Tariff defines affected system as electric system other than ISO controlled grid that may be affected by proposed interconnection And affected system operator as entity operating an affected system Note definition includes electric system that may be affected, without necessarily having made determination that it is in fact affected by interconnection Interconnection customer ( customer ) Participating Transmission Owner ( PTO ) Page 8

interconnection And affected system operator as entity operating an affected system Note definition includes electric system

9 Neighboring Systems as Affected Systems Page 9

10 Tariff requires ISO to notify potential affected system operators at outset of a request for interconnection. ISO will then coordinate with these affected system operators throughout interconnection process ISO has developed process for notification and exchange of necessary information with affected system operators and customers Page 10

ISO will then coordinate with these affected system operators throughout

11 The paper discusses nine process steps. 1. ISO maintains database of potentially affected systems associated with each study area and contact information for potentially affected system operators; used to identify potentially affected system operators to be notified 2. ISO notifies potentially affected system operators at beginning of study process for each interconnection request that is expected, or has potential, to impact affected systems 3. Affected system operators may enter into non-disclosure agreements to access base case and study plan data Page 11

system operators; used to identify potentially affected system operators to be notified 2.

12 nine process steps (continued). 4. ISO provides customers contact information to affected system operators 5. ISO informs customers that their contact information will be provided to affected system operators 6. When study reports are sent out, ISO advises customers via which systems their interconnection may potentially affect 7. ISO provides affected system operators notice when study results are available and invites them to attend the results meeting for each project that may impact their electric systems Page 12

When study reports are sent out, ISO advises customers via e-mail which systems their interconnection may potentially affect 7.

13 nine process steps (continued). 8. ISO provides each customer with letter outlining tasks that need to be accomplished and status report template that customer must provide to ISO on periodic basis, including status of discussions with affected system operators 9. Six months prior to generating unit s in-service date customer must provide documentation confirming that: a) Affected system operators have been contacted and any system reliability impacts have been addressed (or that there are no system impacts), or b) Customer has taken all reasonable steps to address potential reliability system impacts with affected system operator, but has been unsuccessful Page 13

including status of discussions with affected system operators 9.

14 The paper also discusses seven policy principles. 1. ISO does not conduct comprehensive impact studies on neighboring systems, and affected system operators must conduct these studies and provide any mitigation solutions to identified reliability impacts to customer 2. If ISO deliverability studies identify constraints on neighboring systems that limit deliverability of generator and determines that upgrades on ISO system are most cost effective approach to resolving problem, ISO will identify those upgrades as delivery network upgrade responsibilities of interconnection generation project Page 14

mitigation solutions to identified reliability impacts to customer 2.

15 seven policy principles (continued). 3. Generation projects will not be energized on ISO controlled grid until affected system issues are resolved (However, if customer s reasonable coordination efforts with affected system operator do not result in affected system operator moving forward on a timely and reasonable basis, and ISO determines that possible impacts on affected system can be mitigated within ISO controlled grid, ISO will advise affected system operator and customer that interconnection can proceed without affirmative agreement by neighboring system) 4. If customer makes unilateral decision that affected system agreement is not necessary and does not reasonably attempt to address that issue, ISO will advise customer that interconnection will not be allowed to move forward with synchronization and commercial operation unless issue is resolved, including demonstration by customer that it has made reasonable efforts to obtain concurrence by affected system operator that there is no reliability impact Page 15

result in affected system operator moving forward on a timely and reasonable basis, and ISO determines that possible impacts on affected system can be mitigated within ISO controlled grid, ISO will

16 seven policy principles (continued). 5. If requested by customer, ISO will review affected system agreements, tendered to customer and available to ISO, to determine whether they contain terms and conditions that could be problematic for ISO 6. If requested by customer, ISO may review reasonableness of studies conducted and study results issued by affected system operator 7. ISO will review other issues on case-by-case basis, either upon request of customer, or where ISO deems it appropriate Page 16

whether they contain terms and conditions that could be problematic for ISO 6.

17 Questions/comments? Page 17

18 ISO Controlled Grid as an Affected System Page 18

19 ISO tariff does not address impacts on ISO controlled grid caused by interconnection to adjacent systems. However: FERC Order Nos. 2003, et seq. provide framework for affected system coordination and reimbursement Adjacent electric systems and transmission providers are required by NERC planning standards to work together to minimize system impacts caused by generator interconnections Page 19

provide framework for affected system coordination and reimbursement Adjacent electric systems and

20 To date, have been few instances of interconnection to neighboring systems that impacted ISO controlled grid. Thus, ISO has not documented formal process steps ISO suggests that process steps be considered in this initiative Invites neighboring system operators and other stakeholders to make recommendations that could be incorporated into ISO s BPM Steps developed here could be provided by neighboring system operators to their customers Page 20

initiative Invites neighboring system operators and other stakeholders to make recommendations that could be

21 The paper discusses four policy principles. 1. Funding and reimbursement for reliability network upgrades on ISO controlled grid will be in accordance with applicable provisions of ISO tariff regarding generator interconnection 2. ISO expects that ISO and PTO will be notified that their electric system might be impacted by interconnection to adjacent electric system Page 21

22 four policy principles (continued). 3. ISO will use applicable tariff reimbursement scheme for reliability upgrades to PTO systems, depending on date on which customer on neighboring system contacted ISO and PTO whose system potentially could be impacted or entered into a study agreement with contacted PTO whichever was later 4. ISO is developing a three-party pro forma facilities construction agreement to be used when ISO is an affected system Page 22

23 The paper also discusses four potential process steps. 1. Once customer has entered neighboring system operator s interconnection process, and if it appears there could be reliability impacts on ISO controlled grid, ISO and affected PTO(s) are notified by neighboring system operator so that study data can be exchanged and studies coordinated 2. Customer should take reasonable steps to contact ISO and affected PTO(s) and enter into study agreement with ISO and PTO to identify reliability system impacts Page 23

24 four potential process steps (continued). 3. If reliability system impacts and mitigation solutions are identified, customer must enter into facilities construction agreement 4. Prior to synchronization, neighboring system operator should verify that ISO and potentially impacted PTO(s) have been contacted and steps have been taken to address reliability system impacts Page 24

25 Questions/comments? Page 25

26 3. Next Steps Keith Johnson Manager, Infrastructure Policy Page 26

27 The near-term next steps are shown below. Sept 12 Sept 16 Oct 9 Written stakeholder comments due* ISO posts written comments received ISO posts second paper, which will include proposed BPM language * Submit to GIP@caiso.com Use comments template posted at: _GeneratorInterconnection.aspx Page 27

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