Welcome New York Independent System Operator

(Pre-NYISO) Regulated Market Physical contracts Regulated industry Cost Based System Two Party Deals Bundled Services Members sell Firm Transmission Capacity Losses Scheduled in MWH’s (megawatt hours) Fixed % Balanced (hourly or Monthly) New York Independent System Operator

NYISO De-regulated Wholesale Electric Market Financial Deregulated Price Based System Unbundled Services NYISO OATT (Open Access Transmission Tariff) Marginal Losses paid in $’s Balanced every 5 minutes Transmission Congestion Contracts (TCC’s) New York Independent System Operator

A not for profit corporation established to: Maintain safety and reliability of New York State transmission system Schedule and coordinate power transactions New York Independent System Operator

Provide open access to New York State transmission system Provide non-discriminatory treatment for all market participants Provide meaningful involvement by market participants in the oversights of New York State transmission system Act as a clearinghouse for transactions by market participants New York Independent System Operator

Load Serving Entity New York Independent System Operator

Load Serving Entity (i.e. Freeport Electric) Responsible for providing energy, capacity and ancillary services Retail customers liaison with NYISO Submits (schedules) forecasted retail loads for which it is responsible to the NYISO two days ahead and five days out Submits actual metered load data to the NYISO New York Independent System Operator

Ancillary Services New York Independent System Operator

Ancillary Services Ancillary Services – necessary to support the transmission of energy from generator to loads, while maintaining reliable operation of the power system Scheduling, System Contract and Dispatch Reactive Supply and Voltage Support Regulation and Frequency Response Energy Imbalance (mismatches between day ahead schedules and real-time) Operating Reserve (back-up generation) Black Start (generators starting without outside electric supply following a system blackout) New York Independent System Operator

Locational Based Market Price New York Independent System Operator

Locational Based Market Price The price of energy at each of the 11 zones of the New York State Transmission System Equivalent to the cost to supply the next increment of load in the zone Differences in LBMP reflect cost of transmission associated with system congestion Price for NYISO transmission losses Energy imbalance charges New York Independent System Operator

Day Ahead Market New York Independent System Operator

Day Ahead Market Schedules the most economic units available Hour by hour load schedules and generator bids Accepted load schedules and generator bids become forward contracts Prices locked in Sets congestion rents for Transmission Congestion Contracts (TCC’s) Closes at 5:00AM the day before schedule Accepted bids posted at 11:00AM the day before New York Independent System Operator

Hour Ahead Market New York Independent System Operator

Hour Ahead Market Advisory – Generators only Projection of next hour prices Prices not locked in Transaction accepted are settled in Real Time Market (RTM) Closes 90 minutes prior to the hour Looks ahead three hours Accepted bids posted 30 minutes prior to the hour New York Independent System Operator

Real Time Market New York Independent System Operator

Real Time Market Dispatches generation to serve the real time load Real-time computer program adjusts the output of dispatched generators Final settlement for DAM and HAM schedules where actual generation or sales differ from DAM) Operated to match actual load to available generation New York Independent System Operator

Transmission Congestion Contract New York Independent System Operator

Transmission Congestion Contract A financial hedge of transmission congestion, (I.e. protection from congestion charges) Financial equivalent of firm transmission rights Allows holder to collect congestion rent from the NYISO associated with transmitting power from point of injection to point of withdrawal Associated with the physical capability of transmission system New York Independent System Operator

Installed Capacity New York Independent System Operator

Installed Capacity Available resources which ensure that the probability that load exceeds available generation occurs no more than one day in 10 years ALL LSE’s (load serving entities) in New York must maintain ICAP (locational ICAP) Each LSE is assigned an ICAP requirement predicated on its peak demand coincident with the transmission District peak demand If a LSE does not fully meet its ICAP requirement, it must purchase the deficiency through NYISO auctions New York Independent System Operator

Thank You New York Independent System Operator