FERC Subjects Storage, Special Case Resources To Buyer-Side Mitigation In NYISO Capacity Market

Directs NYISO To Ensure That Exemptions For Renewables, Self-Supply Be "Narrowly Tailored"

February 19, 2020

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Reporting by Paul Ring • ring@energychoicematters.com

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FERC has approved a series of orders related to buyer-side market power mitigation in the New York ISO ICAP capacity market

Written orders were not immediately published

FERC described its actions in a news release

FERC said that, in Docket ER16-1404, FERC found that NYISO’s proposed megawatt cap on the renewable resources exemption fails to comply with prior Commission directives, and directed NYISO to make a further compliance filing to ensure the exemptions for both renewable and self-supply resources are narrowly tailored to exempt only those resources the Commission has determined should be exempt.

During a discussion of the order, FERC Chair Neil Chatterjee indicated that FERC accepted, subject to conditions, NYISO's proposed eligibility criteria for the renewable resources exemption, but rejected NYISO's proposed 1,000 MW exemption cap. Chatterjee said that FERC also rejected NYISO's proposal to allow state entities to be eligible for the self-supply exemption

FERC said that, in Docket EL19-86-000, FERC denied a complaint from the New York Public Service Commission and the New York State Energy Research and Development Authority seeking an exemption for electric storage resources from NYISO’s buyer-side market power mitigation rules.

FERC said that, in Dockets EL16-92 and ER17-996-000, FERC found that all new Special Case Resources (SCRs), a type of demand response resource in NYISO, should be subject to NYISO’s buyer-side market power mitigation rules. The Commission also found that payments from retail-level demand response programs designed to address distribution-level reliability needs should be excluded from the calculation of SCRs’ offer floors.

FERC said that, in Docket EL13-62, FERC denied rehearing of an order that rejected a complaint, saying the complainant did not show that NYISO’s tariff was unjust and unreasonable because it permits existing capacity resources needed for short-term reliability and capacity resources with repowering agreements to offer their capacity at de minimis price levels into NYISO’s capacity markets.

As previously reported, due to concerns with FERC's regulations concerning capacity markets, including buyer-side mitigation, the New York PSC has commenced an inquiry into assuring resource adequacy, given questions that have been raised concerning the "compatibility" of the New York ISO installed capacity market with state policy goals.

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