POWER BASICS GENERATION REGULATION Air Waste Management Niagara

POWER BASICS: GENERATION & REGULATION Air & Waste Management Niagara Frontier Section January 25, 2017 Robert E. Knoer, Esq The Knoer Group, PLLC rknoer@knoergroup. com

Electricity's Journey NYISO ESCO

The Power Markets • http: //www. nyiso. com/public/about_nyiso/understanding_the_markets/wholesale_retail/index. jsp

http: //www. eia. gov/todayinenergy/detail. php? id=10

The Power Generators

http: //www. eia. gov/energy_in_brief/article/major_energy_sources_and_users. cfm

http: //www. nyiso. com/public/webdocs/media_room/publications_presentations/NYISO_Presentations/N YISO_Presentations/Power_Trends_in_NY-E%20 Nelson-092316. pdf

The Regulators Federal Energy Regulatory Commission (FERC) North American Electric Reliability Corporation Regions New York Independent System Operator (NYISO) Public Service Commission (PSC)

FERC

“The Federal Energy Regulatory Commission, or FERC, is an independent agency that regulates the interstate transmission of electricity, natural gas, and oil” http: //www. ferc. gov/about/ferc-does. asp

Federal Energy Regulatory Commission (FERC) established in 1977 to replace FPC “. . determine whether wholesale electricity prices were unjust and unreasonable and, if so, to regulate pricing and order refunds for overcharges to ratepayers”

• History: • Federal Power Commission (FPC)created in 1920’s to control hydropower dams • Federal Power Act 1935 - pushed by FDR to dismantle utility monopolies expanded the FPC role to set “just and reasonable” wholesale electricity prices

• FPA (Federal Power Act) • Natural Gas Act • Interstate Commerce Act • PURPA (Public Utility Regulatory Policies Act) • EPAct (Energy Policy Act of 1992) • EPAct 2005 (Public Law 109 -58)

ORDER NO. 888 FINAL RULE (Issued April 24, 1996) Promoting Wholesale Competition Through Open Access Non-discriminatory Transmission Services by Public Utilities; Recovery of Stranded Costs by Public Utilities and Transmitting Utilities SUMMARY: The Federal Energy Regulatory Commission (Commission) is issuing a Final Rule requiring all public utilities that own, control or operate facilities used for transmitting electric energy in interstate commerce to have on file open access non- discriminatory transmission tariffs that contain minimum terms and conditions of nondiscriminatory service.

https: //en. wikipedia. org/wiki/North_American_Electric_Reliability_Corporation#/media/File: NERC-map-en. svg

North American Electric Reliability Corporation Regions • Founded 1968 • Self regulating • Subject to FERC as well as Canadian authorities • 2007 FERC authorized NERC to enforce reliability standards approved by FERC

Regional Transmission Organizations (RTO)

http: //www. isorto. org/site/c. jh. KQIZPBIm. E/b. 2604471/k. B 14 E/Map. htm

New York Independent System Operator (NYISO) “The NYISO was created to fulfill the Federal Energy Regulatory Commission (FERC) mandate to provide fair and open access to the electrical grid”

The NYISO is responsible for the New York Control Area (NYCA) which is part of the Eastern Interconnection http: //www. nyiso. com/public/about_nyiso/importance_of_reliability/grid_operations/index. jsp

Athens Cross Sound Cable Con. Ed Upgrades Neptune

Uniform Clearing Price http: //www. nyiso. com/public/about_nyiso/understanding_the_markets/clearing_price_auctions/index. jsp

The Power Market NYISO ESCO Net Metering Commercial Residential Public

• Established by Public Service Law • Up to 5 members • Required to be bi-partisan • Appointed by the Governor • Confirmed by the Senate

• Public Service Commission • Sets retail rates through tariff filings • Ensures adequate service by utilities • Establishes procedures and eligibility for ESCO; s • Represents rate payers and the public interest

The Power Market – “External Costs” Costs “off budget”: pollution/ climate change impacts defense cost of protecting resources government underwriting of costs tax incentives

POWER BASICS: GENERATION & REGULATION Air & Waste Management Niagara Frontier Section January 25, 2017 Robert E. Knoer, Esq The Knoer Group, PLLC rknoer@knoergroup. com