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

New York Independent System Operator

New York Independent System Operator

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

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