Tiers 1 3 Assignment Flat Profile Recommendation Tiers

Tiers 1 & 3 Assignment Flat Profile Recommendation

Tiers 1 & 3 Assignment Flat Profile Recommendation • Motion 2: A valid challenger must be for a fixed capacity over the term of the request. • Recommendation: Tier 1 and Tier 3 challengers should not be required to have a fixed capacity over the term of the request to be valid challengers. 10/22/2013 Alan Pritchard 2

Tiers 1 & 3 Assignment Flat Profile Recommendation FERC and NAESB Flat Profile Requirement • FERC: – Flat profile requirements were put into place in FERC Order 638 in order to address a gaming opportunity to obtain longer duration requests in order to receive higher priority. • NAESB Table 4 -3: – Duration is only a factor in P&C of Tier 2 by Tier 2 (rows 3 b, 3 c, 3 e, 3 h) and Tier 4 by Tier 4(rows 7 b, 7 c, 7 e, 7 f, 7 h). – Duration is not a factor in P&C by Tier 1 and Tier 3, the current Table 4 -3 does not include this requirement for rows where Tier 1 or Tier 3 are challengers 10/22/2013 Alan Pritchard 3

Tiers 1 & 3 Assignment Flat Profile Recommendation Problems with Flat Profile Requirement 1. Where capacity is inflated to meet the requirement, NITS customers could immediately reduce capacity upon confirmation. – needless displacement (bumping) of lower priority reservations/requests – Customers with displaced reservations/requests could submit replacement requests after capacity is released by NITS customer but would lose queue position. 10/22/2013 Alan Pritchard 4

Tiers 1 & 3 Assignment Flat Profile Recommendation Problems with Flat Profile Requirement 2. The NITS customer may not have rights to the additional DNR capacity needed for the inflated (see #1) flat profile request and could not legally provide an attestation. Possible work-around to get DNR capacity: submit multiple shorter duration flat-profile DNR requests (Tier 1). – DNR request cannot be granted without a work-around. – Work-around: Would result in multiple requests processed and longer queue processing time than for a single request – Work-around: The ultimate impact would likely grant the same capacity as would be granted through processing of a single profiled DNR request. 10/22/2013 Alan Pritchard 5

Tiers 1 & 3 Assignment Flat Profile Recommendation Issue NITS (Excluding OATT 2. 2) PTP (within same Tier) PTP (Higher Tier vs. lower Tier) Duration Not applicable for NITS as challengers. Only applicable in Tier 2 vs Tier 2 or Tier 4 vs Tier 4 P&C (see slide 3). Not applicable to Higher Tier PTP vs Lower Tier PTP P&C. Duration is only used for response timing table (See Table 105 A). There are no specified Service Increments for NITS 10/22/2013 Alan Pritchard 6

Tiers 1 & 3 Assignment Flat Profile Recommendation Issue NITS (Excluding OATT 2. 2) Profiled Requests Included in NITS standards (WEQ-001 -101. 2) Necessary for DNR because the customer can only request capacity that customer owns or controls (i. e. , meets attestation requirements) 10/22/2013 PTP (within same Tier) Permitted at Transmission Provider’s option (WEQ-013 -2. 6. 1) Alan Pritchard PTP (Higher Tier vs. lower Tier) Permitted at Transmission Provider’s option (WEQ-013 -2. 6. 1) 7

Tiers 1 & 3 Assignment Flat Profile Recommendation NAESB Business Practices – Profiled Requests • WEQ-001 -101. 2 (NITS) OASIS shall support capability that allows the Eligible Customer or Transmission Customer to submit information required for arranging of NITS through multiple requests that together, represent the requested service. This shall include multiple requests submitted as part of a single NITS Application, as well as multiple requests submitted as modifications of service (including Concomitant Evaluations and Coordinated Requests). • WEQ-013 -2. 6. 1 (PTP) The Transmission Customer may submit a time varying profile of capacity as allowed by the Transmission Provider’s Business Practice by repeating the template Data Elements of BID_PRICE, CAPACITY_REQUESTED, START_TIME and STOP_TIME in template continuation records. The segments of any submitted profile must not overlap in time 10/22/2013 Alan Pritchard 8

Tiers 1 & 3 Assignment Flat Profile Recommendation Summary Ø Duration is only considered in P&C for: • Tier 2 vs. Tier 2 and • Tier 4 vs. Tier 4 Ø For Tiers 1 & 3 Challengers: • Flat profiles are not needed to prevent gaming since duration is not a factor • NITS customers who inflate capacity to get to flat profile then release unneeded capacity upset market dynamics • Requests for DNR capacity may not be able to inflate capacity to meet flat profile requirements (attestation restrictions) • NITS customers who submit multiple small flat profile requests impact queue processing efficiency 10/22/2013 Alan Pritchard 9

Tiers 1 & 3 Assignment Flat Profile Recommendation • Tier 1 and Tier 3 challengers should not be required to have a fixed capacity over the term of the request to be valid challengers. • Rescind Motion 2 and replace it with a motion that applies only to Tier 2 vs. Tier 2 and Tier 4 vs. Tier 4 preemption and competition. 10/22/2013 Alan Pritchard 10

Tiers 1 & 3 Assignment Flat Profile Recommendation Draft Language for Replacement for Motion 2 • In each row of Table 4 -3 where duration is included in the column labeled Is Preempted by Subsequent Request 2, a valid challenger must be for a fixed capacity over the term of the request. 10/22/2013 Alan Pritchard 11