Dave Forrest M A N A G E R , E N G I N E E R I N G & S T U D Y C O O R D I N A T I O N

ISO-NE Planning ProcessResponse to PAC Comments

Planning Advisory Committee Meeting

M A Y 2 2 , 2 0 1 3 | W E S T B O R O U G H , M A

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Presentation Goals

• Present the ISO’s responses to comments received on the ISO-NE Planning Process Guide

• Describe the ISO’s proposed approach to the three issues that generated the highest level of interest

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Background

• A draft Planning Process Guide was presented to PAC on February 12, 2013

• On March 22, 2013, a reminder was sent requesting comments no later than March 31, 2013

• Comments that were received are posted on the ISO website at:– http://www.iso-ne.com/committees/comm_wkgrps/prtcpnts_comm/p

ac/plan_guides/index.html

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Categorization of Comments

• The ISO reviewed the comments and has placed them in three categories– Comments to the Process Guide that clarify the description of the

current process (Clarifications)– Comments that propose changes to the existing process that the ISO

intends to discuss further with Stakeholders at upcoming PAC meetings (Proposed Changes)

– Comments and/or questions that ISO will respond to at today’s meeting or defer to future revisions (Comments)

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Clarifications

• A number of comments enhance the description of the existing process or requested additional information be added

• ISO accepted many comments of this nature and added information where requested

• A redlined version of the Planning Process Guide that shows changes to the February 5, 2013 version is posted with the meeting materials

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Proposals for Process Changes

• There are three process-related areas that seemed to generate the highest level of interest. The ISO intends to address these areas with stakeholders at future meetings– Communications– Study groups– Evaluation of alternatives

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Communications

• Comments were received from PAC members that addressed the communications on transmission projects

• Examples of these comments are included at the end of this presentation

• The ISO proposes to present the current process of communicating projects to PAC, tentatively at the July meeting, and solicit suggestions for improvements

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Study Groups

• Participation in study groups was the issue that solicited the most comments from PAC members, both at the meeting and in written comments

• Examples of these comments are included at the end of this presentation

• The ISO proposes to hold a special stakeholder meeting in the fall to address this issue and report back to PAC with recommendations

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Study Groups, cont.

• The major goals of the special meeting will be:– To develop a clear mutual understanding of the roles and

responsibilities of the study teams and study team members– To elicit from stakeholders what specific needs are not being satisfied

by the current PAC process

• The information shared in the discussions of communications will serve as important input to the special meeting

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Evaluation of Alternatives

• Several comments were received from PAC members that suggested that the process for evaluating solution alternatives should be more robust

• The Greater Boston study will provide the latest example of the process for evaluating solution alternatives

• After this information is presented to PAC, the ISO will schedule a discussion of the process used to evaluate alternatives and solicit suggestions on how to improve future evaluations

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Response to Other Comments

• The ISO received several other comments that we believe can be responded to today

• Other comments will be addressed in the future

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Response to Other Comments, cont.

• Comment - Will the Planning Manual be brought forward to a vote at, say, the RC? Without such a vote, it's not clear that ISO will get a full sense of stakeholder positions.

• ISO Response - We believe that PAC meetings are an appropriate forum for discussion of stakeholder positions. We intend to bring any changes to Planning Procedures or the Tariff through the appropriate stakeholder process.

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Response to Other Comments, cont.

• Comment - The guide does not have any reference to the ISO or NEPOOL task forces and working groups and their review of the study scope or results. To document what we are doing today, this should be modified even if there is a suggestion of changing this in the future.

• ISO Response - This will be addressed in a future revision.

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Response to Other Comments, cont.

• Comment - NHT is concerned that initial project study scopes might be too narrow, both in terms of areas to be studied and possible solutions to be considered. Perhaps more comprehensive studies that would include facilities in adjacent areas would aid coordination of studies in those adjacent areas. This issue should be discussed by the PAC.

• ISO Response - We believe that existing Needs Assessments provide a comprehensive review of an appropriate part of the system without being so big as to become unwieldy. Needs Assessments of adjacent areas are coordinated by the ISO and combined when appropriate (e.g., NEEWS, VT/NH). Also, the scopes of Needs Assessments, Solution Studies and each project are presented to PAC. Any stakeholder can suggest changes during those multiple opportunities.

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Response to Other Comments, cont.• Comment - NHT is concerned that the 10-year planning horizon

referenced in the tariff could lead to shortsighted decisions given the uncertainty involved in planning out that far. A possible fix to this would be to change Attachment K to say that the study horizon will look out over a period of “at least” 10 years with ISO-NE having the discretion to define the study horizon on a case-by-case basis taking into consideration input from the PAC. That is a very minor change that should be fairly easy to get through the review and approval process. Another option, suggested by Tom Welch, could be to have the 10-year horizon begin on the date that the proposed solutions would be in service. This would effectively extend the time horizon another 5 years or so.

• ISO Response - This issue was also raised in comments on the Technical Guide and will be addressed together with the use of the 90/10 load forecast.

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Response to Other Comments, cont.

• Comment - Need section 2.5.10 to recognize the language in 2.5.7 that a preferred solution is already selected and sanctioned by ISO-NE and the TCA process is more oriented to gold plating review of an already approved preferred solution. Schedule 12C may need to be modified and updated to reflect this same process as it is not in step with where we need to go on this.

• ISO Response - This is a modification to existing practice and will be addressed in the future.

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Response to Other Comments, cont.

• Comment – Could ISO-NE give states and stakeholders a sense of how, prior to running analysis, ISO-NE identifies whether changed assumptions are likely to affect the year of need by more than 5 years? Further, would ISO-NE please include in the section language that indicates ISO-NE will explain its analysis and decisions to adopt new assumptions, or not to, in the event a stakeholder identifies a change in assumptions that warrants consideration?

• ISO Response - This will be addressed in a future revision.

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APPENDIX – SAMPLE COMMENTS

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Sample Comments on Communications• “To increase transparency, the process guide should provide that ISO will post

high-level non-CEII meeting summaries so that stakeholders not included in needs or solution study groups have information about who is participating in what discussions. To facilitate stakeholder review, especially in light of regular scope changes, the ISO should consider adding to its website a link to each study which would track a project from the needs assessment stage to placement in the RSP and include information on scope changes. See the NERC website for project tracking and explanation of status as a possible model.”

• “Is there a designated place on the ISO’s website where final reports will be posted (even if in duplicate to other places) or will interested parties need to dig?”

• “Is the RSP Project Listing in the RSP?”

• “Given that ISO identifies the most cost-effective solution as the preferred solution (consistent with language above,) the RSP should provide cost information.”

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Sample Comments on Communications, cont.

• NESCOE commented: “The ISO will post the draft of the Needs Assessment Report and problem statement on the PAC website for a 30-day review period. The ISO will arrange a PAC meeting at the end of the review period for discussion and comment on the study and the study results. This includes a review of the study that was conducted including all assumptions and testing performed, a summary of the conditions modeled and a summary of the problems and concerns identified in the study. A review of system performance issues to the standards or criteria used in the assessment also is provided. The goal of the review process is to ensure that PAC members understand the nature of the problems and their causes identified in the Needs Assessment. The ISO will arrange additional PAC meetings as needed to meet this goal. Some studies are more complex and may require additional PAC meeting discussions in order to respond to all stakeholder concerns or questions.”

• NESCOE commented: “The ISO will also solicit the views of State regulators, NESCOE, the Market Advisor, and the ISO Board of Directors on the draft Needs Assessment Report and problem statement. The ISO will consider all stakeholders’ input, will provide responses and post on its website such responses to substantively material stakeholder input ISO receives so that stakeholders understand why ISO either accepted or rejected stakeholder recommendations and will revise the draft documents as appropriate based on stakeholder comments provided through this review process.”

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Sample Comments on Study Teams

• “The Tariff (Attachment K) states that "affected stakeholders" will be involved in the planning process. That is much more broad than "Stakeholders whose facilities may be electrically impacted.” (Draft Manual Section 2.3). We need a process to involve those affected stakeholders.”

• “Restricting membership for these study groups as has been past practice not only unduly limits transparency, but precludes input and potentially useful alternatives from being properly considered. This can lead to inferior solutions. Allowing more participant input in the study groups should also help with stakeholder buy-in later, as there would be more confidence that a full range of alternatives (and impacts) are considered in the process.”

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Sample Comments on Study Teams, cont.

• “ISO currently includes only those TOs whose facilities are directly impacted by a study in the working group established to review and guide that study. NHT believes that all TOs should be invited to participate. There may be valid anti-competitive reasons why other market participants would not be included in these study groups.”

• “Attachment K uses the term “affected stakeholders.” ISO should discuss with PAC what that term means and define that term in this planning process guide.”

• “Attachment K Section 4.1 contemplates that ISO, in the context of Needs Assessment Study Groups, will deal with information that is subject to Info Policy, CEII and Standards of Conducts limitations by forming sub-working groups with limited participation. The Process Guide should detail how ISO will manage information sharing restrictions through such sub-working groups contemplated by the tariff (notice re: establishment, etc.).”