Grid Operations Engagement Group ISO/DSP Interaction and Coordination August 25, 2016 Presentation material does not represent the views of the Joint Utilities Engagement Group as the group is still in discussion on these topics. Please do not redistribute this deck.

Agenda Time Topic 1:00 – 1:15 Introductions and Overview of Meeting 1:15 – 2:00 NYISO Presentation and Discussion 2:00 – 3:00 JU Presentation and Discussion 3:00– 3:15 Break 3:15 – 3:45 California ISO Presentation and Discussion 3:45 – 4:00 Summary & Next Steps

Engagement Group Ground Rules* All stakeholder engagement (Advisory Group and Engagement Group) meetings, webinars and information exchange are designed solely to provide an open forum or means for the expression of various points of view in compliance with antitrust laws. Under no circumstances shall stakeholder engagement activities be used as a means for competing companies to reach any understanding, expressed or implied, which tends to restrict competition, or in any way, to impair the ability of participating members to exercise independent business judgment regarding matters affecting competition or regulatory positions. Proprietary information shall not be disclosed by any participant during any stakeholder engagement meeting or its subgroups. In addition, no information of a secret or proprietary nature shall be made available to stakeholder engagement members. All proprietary information which may nonetheless be publicly disclosed by any participant during any stakeholder engagement meeting or its subgroups shall be deemed to have been disclosed on a non-confidential basis, without any restrictions on use by anyone, except that no valid copyright or patent right shall be deemed to have been waived by such disclosure. AG & EG discussions will be open forums without attribution and no public documents by the AG or EG will be produced unless publication is agreed upon by the group. *Ground Rules adapted from the JU Advisory Group

Grid Operations Engagement Group Charter Purpose: Explore JU common approaches for continued secure, safe and reliable operation of the distribution system under increased penetration of Distributed Energy Resources (DER) while enhancing DER participation opportunities and move towards a future utility role as Distributed System Platform (DSP). Topics and Scope: System Data; NYISO/DSP Interaction and Coordination, Monitoring and Control System Data Discuss the type of system data that the stakeholders would require to make investment decisions on the NY grid Identify the highest value information for DER providers to make effective decisions Identify the granularity of the information required for specific planning and analysis purposes Identify the frequency of the information required Discuss methods for overcoming limitations related to security and confidentiality Discuss the process for providing value added information to stakeholders Monitoring and Control Determine monitoring requirement of DERs Explore the impact of DERs on real- time operations of the grid that include scheduling, operation and dispatch Explore potential control signals to align NYISO and DSP generation or needs for load reduction. Discuss standards and protocols for DER aggregation Discuss DER response to emergency and contingency events. NYISO/DSP Interaction and Coordination Describe the extent to which retail and wholesale operations are currently coordinated within existing programs. Explore the evolution in assumptions necessary to align ISO and DSP operations. Determine whether further analysis of DER is necessary for more accurate estimation of DER contribution to serving grid needs for planning and operations. Explore the visibility required for DER on the distribution system for the ISO to accurately reflect and align their forecasts

NYISO/DSP Interaction and Coordination Topics from Grid Ops Charter Describe the extent to which retail and wholesale operations are currently coordinated within existing programs. Explore the evolution in assumptions necessary to align ISO and DSP operations. Determine whether further analysis of DER is necessary for more accurate estimation of DER contribution to serving grid needs for planning and operations. Explore the visibility required for DER on the distribution system for the ISO to accurately reflect and align their forecasts

NYISO Perspective on DSP Interaction and Coordination Grid Operations Stakeholder Engagement Group August 25, 2016

Distributed Energy Resources Roadmap Matt Darcangelo Manager - Distributed Resources Integration Joint Utilities Grid Operations ISO/DSP Coordination August 25, 2016 National Grid - Albany, NY

Initiative’s Scope Roadmap for next 3-5 years for integration of DER and evolutionary changes in current Demand Response programs DER is a resource or set of resources -- typically located on an end-use customer’s premises and operated for the purpose of supplying customer electric load -- that seeks to provide NYISO wholesale market services Curtailable load, generation, storage or various combinations Individual resources or aggregations Net load or net generation

DER Roadmap Development Process Kickoff Overview of Roadmap Concepts May 24, 2016 Review Stakeholder Input for Roadmap Development June /July 2016 Initial Draft Published August 2016 Stakeholder Comments and Feedback Summer/Fall 2016 Publish DER Roadmap (living document) 2016 Follow Roadmap and Execute Projects 2017-2021

Key Objectives Integrate DER into energy markets Ability for real-time scheduling Minimize out-of-market actions Align with goals of NYS REV Measurement and Verification Align payments with performance Focus on wholesale market

Future Wholesale DER Participation Real -Time Dispatchable Capacity Energy Ancillary Services Special Case Resource (SCR) Program Manual Activation Flexible Performance & Payment Options Emergency Demand Response Program (EDRP) Manual Activation Voluntary Load Reduction Reliability Non - Dispatchable Load Modifier Self-managed Load Reductions to Reduce Capacity Obligation Price Capped Load Bid Economic Day Ahead Load Procurement Dispatchable Distributed Energy Resources Comparable to a Generator Supports Aggregations of DER Fully integrated in both Capacity and Energy Markets Capacity with Daily Energy Must-Offer Obligation Flexible performance & payment options Economic Real -Time Dispatchable

Integrating DER in Wholesale Electricity Markets Wholesale service provided through DSP super aggregator DSP Wholesale service provided to ISO Retail service provided to DSP ESCO Aggregator Wholesale Services Capacity Energy Regulation Services Operating Reserves Retail Services Wholesale service direct to ISO Retail service direct to DSP Service provided through Aggregator Distributed Energy Resources Wholesale Services Retail Services

DER Roadmap Development & Input DER Workshop September 22 – Radisson, Wolf Road Albany, NY Verbal comments at DER Workshop and NYISO Shared Governance Meetings Written comments to mdarcangelo@nyiso.com and/or deckels@nyiso.com http://www.nyiso.com/public/webdocs/markets_operations/market_data/demand_response/Distributed_Energy_Resources/DRAFT%20Distributed%20Energy%20Resources%20Roadmap%20-NYISO%208-17.pdf

The Mission of the New York Independent System Operator, in collaboration with its stakeholders, is to serve the public interest and provide benefit to consumers by: Maintaining and enhancing regional reliability Operating open, fair and competitive wholesale electricity markets Planning the power system for the future Providing factual information to policy makers, stakeholders and investors in the power system www.nyiso.com

2016 Solar Forecasting Initiative Overview Arthur Maniaci NYISO System & Resource Planning Joint Utilities Grid Operations ISO/DSP Coordination August 25, 2016 National Grid - Albany, NY

Project Scope & Schedule Provide real-time solar power forecasts to Operations -- both distributed (behind-the-meter) and specific sites (large grid-connected sites) Provide solar forecasts to Operations for display on Grid Operations video display Modify NYISO forecasting software to include forecasts of solar irradiance and solar power Explore how to obtain real-time actual irradiance and behind-the-meter SPV power data from third-party firms Project is to have Code-Ready status by Dec 2016 and implemented in Q2 2017

Current Forecasting Process of Load Using Weather Forecasts as Input Weather Forecaster Provides Hourly Forecasts NYISO Forecast Software Inputs Weather Forecasts Updated Hourly Hourly update, 15 minute intervals Forecasts Load Forecast Models Five-minute RTD forecast process Load Data Updated Every 5 Minutes

Proposed Plan for Solar Forecasting Includes Use of Actual Irradiance and BTM SPV kW Data Inputs Hourly Weather, Irradiance & Power Forecasts NYISO Forecast Software Solar Forecaster: irradiance and power forecasts Hourly update, 15 min. intervals Load & Solar Forecast Models Forecasts Five-minute RTD forecast 15-Minute Load & Solar Forecasts Actual solar irradiance and SPV power data are sent to solar forecast vendor in real-time. Actual Grid-Scale SPV MW Data from NYISO Actual Distributed BTM SPV MW Data from Vendor Actual Irradiance Data from Vendor

Dispatch, Commitment & Visual Display All Forecasts are sent to other NYISO Systems & NYISO Video Display Wall Actual Load & Solar Inputs Forecasts at 15-min Intervals Forecasts of load, distributed solar and grid solar, all at 15-minute Intervals Net MW Load in Zone Grid Operations: Dispatch, Commitment & Visual Display BTM SPV MW in Zone Total Load = Net Load + BTM SPV Grid-Connected Solar Sites Site 1 Site 2 Site 3

The Mission of the New York Independent System Operator, in collaboration with its stakeholders, is to serve the public interest and provide benefit to consumers by: Maintaining and enhancing regional reliability Operating open, fair and competitive wholesale electricity markets Planning the power system for the future Providing factual information to policy makers, stakeholders and investors in the power system www.nyiso.com

ISO-DSP Operations Coordination Grid Operations Stakeholder Engagement Group August 25, 2016

Outline and Agenda Overview Where are we now Where are we heading Review current coordination practices between JU and NYISO Where are we heading Review and expected timing Next Steps and Summary JU / NYISO continuing discussion

ISO-DSP Coordination Overview John Borchert, Central Hudson

Relevance of ISO-DSP Coordination to the REV Goals Under “Reforming the Energy Vision” (REV) strategy, New York is seeking to promote, among other things, wider deployment of distributed energy resources (DERs) such as micro grids, roof-top solar, other on-site power sources and storage As greater numbers of DERs interconnect to the grid and participate in new programs, additional coordination between the ISO and DSPs for safe and reliable operation of the system is necessary Coordination is paramount as the NYISO administers markets under the NYISO tariffs, resources connected at <115kV are likely to be dispatched on a pure market evaluation vs. a combined market and security constrained basis. Conversely dispatch by a DSP may also have impacts upward onto the Bulk Electric System. Coordination may also provide additional opportunities for DERs to participate in programs at either or both the ISO and/or DSP levels Coordination will improve customer benefits through appropriate procurement of capacity and energy

DSIP Filing Guidance on ISO-DSP Coordination The April 20th DSIP Order instructs the utilities to begin to identify areas which will require interaction between the ISO and DSP to maintain quality operations: “With respect to the roles, responsibilities, and interactions between utilities and the NYISO, it is expected that the Supplemental DSIP will begin to define the obligations and actions that will be needed to ensure seamless and reliable operations of a dynamic transmission and distribution grid”

DSP/NYISO Coordination Required in Multiple Areas Grid Operations Distribution Planning Market Operations Real Time and Day Ahead DER performance Load Forecasting ISO Programs Real Time and Day Ahead Load Forecasts DER Penetration Forecasts DSP Programs Sharing info on DER participation in programs at ISO and DSP level Settlement Communications type and frequency Today’s discussion is focused on the Grid Operations area only

NYISO-DSP Operations Discussions The JU has begun collaborative process to engage experts from the NYISO in the bulk and distributed power system operations The JU/NYISO have sought input from participants in the California processes to identify relevant issues with respect to ISO-DSP coordination on operational issues

Where Are We Now? David MacRae, ConEd

COMMUNICATIONS AND COORDINATION CURRENTLY VARY BY PROGRAM NEED Where Are We Now? COMMUNICATIONS AND COORDINATION CURRENTLY VARY BY PROGRAM NEED Currently, coordination between the NYISO and JU regarding DERs is primarily focused on Demand Response (DR) DR participation exists today as Utility only – contingency, peak load shaving NYISO only – SCR; EDRP; DSASP Both NYISO and Utility Units larger than 1 MW may also directly participate in the NYISO markets as SC 11 customers, or as Large CHP/Cogen units NYISO also allows Behind the Meter (BTM) net generation (NG) resources to participate in the wholesale market with surplus (“net”) energy and/or capacity available after serving their host load obligations Resources with a name plate rating of 2 MW, with valid interconnection allowing export of at least 1 MW

Current Coordination Activities Parameter Operations Planning Details Frequency Load-Forecasting Typically, individual company forecasts are not coordinated with the NYISO, except on high load days As needed basis via conference calls Utilities provide NYISO with a 10 year electric load forecast Annual DER/DR Dispatch Utilities and NYISO notify each other via emails and/or phone calls when they plan to dispatch DR for test or actual events As needed basis via phone calls and emails. The coordination depends on the DR program being called. N/A DER/DR Forecasted Operations If signed onto the NYISO tariff as DG’s and SCR’s, need to communicate their operation in the form of a bid Daily Available DER/DR Capacity DR enrollment information is shared for identifying overlapping resources so that operational awareness can be improved Monthly Embedded in the 10-year electric load forecast DER/DR Performance DR event performance summary filed with PSC

NYISO-Utilities Coordination for DR Programs Coordination occurs at various levels: Pre-Event Email, Phone Call between NYISO and utilities Day Ahead 2-hour prior to event During Event Utilities and NYISO notify each other of when a DR event is activated Post Event Monthly Reporting of participating resources to estimate: Addback MW for NYISO’s peak load formulation www.coned.com/DR

Con Edison and NYISO Demand Response – Operational Coordination Activities Coordination with the NYISO occurs at various stages of demand response operations NYISO provides a list of its participating accounts each month. Verify the account and cross reference to identify discrepancies The list of participating accounts impacts aspects of DR operations: Enrollments Measurement and Verification (M & V) Operations Planning

Enrollments, M & V, Operations Planning We advise the NYISO of any inactive accounts on their list, they follow up with the aggregators The list includes ACL and Pledged kW for each account M & V Update customer baseline (CBL) calculation to ensure that the days of NYISO DR events are excluded from the CBL calculation for accounts that participate in Con Edison and in NYISO programs We provide DR event performance data for DR events initiated by us to the NYISO for “add back” purposes. NYISO uses this data to add back these kWs to customer load profiles for ACL determination Operations Planning Prepare the “overlap” report to understand the amount of DR resources in each network and the overlap of the NYISO and Con Edison DR resources. This report is used to communicate the expected level of DR to operators for contingency planning.

The Challenges Ahead John Borchert, Central Hudson

Bulk and Distribution Grid Operational Coordination Concerns The JU anticipates further areas of review as dispatchable DER participation via aggregators becomes possible as per NYISO’s roadmap Limitation on aggregation due to reliability impacts on distribution systems Operational Awareness of the response of aggregated/individual resources on individual circuits due to activation and dispatch instructions of NYISO Also, as dispatchable resources serve as both load reductions and power injections, additional coordination between the DSP and NYISO will be required NYISO currently anticipates a 3 to 5 year timeline before such programs are introduced under its roadmap The timeline should allow for scaling up existing communication systems and protocols to handle more frequent communication with NYISO and an increasing number of DERs

Bulk and Distribution Grid Operational Coordination Concerns No formal standards exist today between the NYISO and JU. As DER programs types increase, and the flexibility and responsiveness of DERs grow, formalization of operational standards will be required Possible formalization could be through the NYISO stakeholder process Solar forecasting methods NYISO working on 8760 solar forecasts for enhancing operations NYISO-JU can leverage the tool further to share inform information and inform operations Information sharing requirements between the ISO and DSP will increase to ensure appropriate planning and operations standards exist. NYISO and JU should be able to freely share information for planning, operations with out concerns for markets, privacy.

Path Forward – Coordination of Operational Activities Formalize Current Communication Practices Improve Communication Protocols As DERs increase market penetration, communication processes will need improvement for daily operating plans and day-ahead forecasts Dispatch Protocols DER becomes integrated at a level that communication needs to enable the utility to override dispatch orders Dispatch Interface Development Resources will service ISO and the DSP needs JU and NYISO develop an operating interface that matches the need for market coordination

Next Steps and Summary John Borchert, Central Hudson

ISO-DSP Coordination Next Steps The ISO and JU will continue to engage in regular discussions to advance coordination requirements and needs NYISO is expecting to receive stakeholder comments on their draft ‘Roadmap’ positions, the NYISO intends to engage the JU once comments are received to begin to identify key issues for coordination with the DSP Regular working groups will continue thereafter – propose quarterly meetings subject to NYISO agreement NYISO DER evolution roadmap will influence next steps Summer 2016 – DER Roadmap draft released (8/17/16) Fall 2016 - Stakeholder review 2017 - Modifying tariff language for initiating market rule changes 2018/2019 – Market products development

ISO-DSP Potential Areas for Discussion Information exchanges between DSP and NYISO – content, format, and timing Short-term forecasting (real-time, day-ahead, week-ahead) of net load and autonomous DER behavior Ability to calculate expected distribution system impacts of ISO dispatches of DER; “feasibility” of ISO dispatches Standard interface between DSP and NYISO Situational awareness – sensing and data systems Operating procedures to deal with the normal day to day activities & the unexpected

ISO-DSP Operations Coordination Summary Currently DERs can participate in utility and NYISO administered programs. The primary area of overlap is demand response. Demand response dispatch by the NYISO is coordinated with the JU and vice-versa. Various communication channels are used depending on the program Near-term goals include: Establish a formal process of cross-pollination with NYISO and the JU Identify a process to formalize coordination standards between the parties going forward Rules on sharing customer or resource level information may evolve over time Establish a feedback process for DERs to communicate with the JU and NYISO In the long-term, utilities need to monitor penetration levels and gauge how coordination can be improved. Using the amount of DER in queue as a trigger, steps towards a more coordinated Day Ahead forecast can be initiated As Solar PV in the queue is realized, it would influence wholesale market mechanisms, causing further coordination issues Reciprocity of information sharing between NYISO and DSPs will be established The JU supports continuing discussions with the NYISO to achieve increased awareness and situational response of distribution and bulk grid activities

CAISO Experience on DSP Interaction and Coordination Grid Operations Stakeholder Engagement Group August 25, 2016

Thank you for joining us! Please contact info@jointutilitiesofny.org or visit our website www.jointutilitiesofny.org for more information

Appendix & Reference Materials

Overall Engagement Group Purpose & Objectives The Grid Operations Stakeholder Engagement Group (EG) is an open forum for stakeholders who are actively engaged in the REV process and the Distributed System Implementation Plan (DSIP) filings to provide input to, and exchange ideas with, the Joint Utilities of New York (JU) on topics related to grid operations as identified by the Joint Utilities Stakeholder Advisory Group (AG). Objectives Exchange information, ideas, and perspectives of mutual interest to grid operations. Facilitate JU understanding of the grid operations business needs of Stakeholder participants. Facilitate Stakeholder understanding of the scope of JU grid operations. Discuss identified topics to achieve shared understanding, identify areas of convergence and clarify areas of differences.

Engagement Process Overview Stakeholder Engagement Schedule Jan 2016 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2017 DSIP Final Guidance Initial DSIP Filings Supplemental DSIP Filing Advisory Group Mtgs Initial DSIP Stakeholder Engagement* Supplemental DSIP Engagement Groups Distribution Planning** Grid Operations Market Operations Stakeholder Conferences*** *Initial DSIP engagements dates based on individual JU workshop schedule during this period. **ITWG beginning in March, EG begins in May. *** Stakeholder engagement conferences to engage a wider set of participants to inform technical discussions and share Engagement Group results, as needed and in consultation with the Advisory Group Source: Updated plan for stakeholder engagement process as reflected in May 5th DSIP filing

Grid Operations Engagement Group Charter Purpose: Explore JU common approaches for continued secure, safe and reliable operation of the distribution system under increased penetration of Distributed Energy Resources (DER) while enhancing DER participation opportunities and move towards a future utility role as Distributed System Platform (DSP). Topics and Scope: System Data; NYISO/DSP Interaction and Coordination, Monitoring and Control System Data Discuss the type of system data that the stakeholders would require to make investment decisions on the NY grid Identify the highest value information for DER providers to make effective decisions Identify the granularity of the information required for specific planning and analysis purposes Identify the frequency of the information required Discuss methods for overcoming limitations related to security and confidentiality Discuss the process for providing value added information to stakeholders Monitoring and Control Determine monitoring requirement of DERs Explore the impact of DERs on real- time operations of the grid that include scheduling, operation and dispatch Explore potential control signals to align NYISO and DSP generation or needs for load reduction. Discuss standards and protocols for DER aggregation Discuss DER response to emergency and contingency events. NYISO/DSP Interaction and Coordination Describe the extent to which retail and wholesale operations are currently coordinated within existing programs. Explore the evolution in assumptions necessary to align ISO and DSP operations. Determine whether further analysis of DER is necessary for more accurate estimation of DER contribution to serving grid needs for planning and operations. Explore the visibility required for DER on the distribution system for the ISO to accurately reflect and align their forecasts

Grid Operations Topic Descriptions System Data System data includes grid information such as power consumption, power quality, and reliability at various granularities (system-wide, substation, feeder, etc.). The data is used to generate insightful information that is used by the utilities to support the planning and operation of the distribution system. Insightful information derived from system data would also enable DER providers to make investment and operational decisions that would be beneficial to the overall system thereby increasing societal benefits. The utilities would provide the information necessary for developers to offer solutions that can improve the efficiency of the system and add value to customers. Cyber Security Cyber security measures are essential for maintaining the confidentiality, integrity, and availability of information. With increased communication and information exchange between the grid entities, cyber security is a critical issue that must be addressed by the utilities. Cyber security plans account for protection of all and any communication of data within the utility and between the utility and third party facilities.

Grid Operations Topic Descriptions continued Monitoring and Control Monitoring Monitoring of the distribution assets and DERs in the distribution system is essential for maintaining the reliability of the grid. As distributed energy resources have considerable impact on the distribution grid operation, the need for advanced monitoring capability increases with the penetration of distributed energy resources. The topic focuses on the needed expansion and improvement in visibility and communication protocols to interact with and observe DER providers. Control/Dispatch Control at the distribution level refers to signaling and mobilization of distribution assets to satisfy system operational goals in real-time. The ability to control distribution system assets is vital to the reliable and efficient operation of the distribution grid. The term ‘control’ signifies the utility having complete discretion over operation of the asset. Whereas, the term ‘dispatch’ indicates that the utility sends control signals to the asset owner who have discretion over operation of the asset. The term ‘dispatch’ is used for signals sent to DER providers.