Commissioner Richard Glick Dissent Regarding NYC Energy LLC

Commissioner Richard Glick Statement
March 19, 2020
Docket No. ER20-629-000

Dissent Regarding NYC Energy LLC

I dissent from today’s order because I would grant NYC ENERGY LLC’s (NYCE) request for waiver.  NYCE is developing a roughly 80 MW battery storage facility that would interconnect with Consolidated Edison’s system in Brooklyn. 1   The basic issue here is that NYCE failed to comply with certain of NYISO’s interconnection procedures and, as a result, lost its position in the interconnection queue.  Those procedures require a generator to take a series of steps within thirty days of executing its Class Year Interconnection Facilities Study Agreement (Class Year Study Agreement). 2   One of those steps is to show that the generator has satisfied the applicable regulatory milestone laid out in Attachment S to NYISO’s Tariff. 3   In the event that the generator has not satisfied that step, it may instead opt to pay an additional deposit of $3,000 per MW on top of the $100,000 deposit required of all generators. 4   If the generator fails to take all the actions required in the thirty-day period, it is not eligible to participate in the relevant class year and may lose its place in the interconnection queue. 5

NYCE’s planned facility was originally designed as a dual-fuel oil/gas combined-cycle unit. 6   Last year, however, NYCE decided to develop the project as a battery storage facility instead. 7  Before that change, NYCE applied for and received a conditional determination from the state and the city that its proposed facility would have no adverse environmental impacts. 8 NYCE sought to use those determinations to satisfy the regulatory milestone requirement in Attachment S. 9   NYISO concluded that those determinations did not satisfy that requirement in light of the design change and, therefore, that NYCE had not satisfied all the Attachment S conditions within thirty days of signing its Class Year Study Agreement. 10   Upon learning of NYISO’s determination, NYCE offered to pay the additional $3,000/MW deposit. 11 Nevertheless, NYISO concluded that NYCE had failed to meet the requirements of Attachment S and removed the project from its interconnection queue. 12

NYCE then filed this waiver request.  NYISO filed comments supporting the waiver request, noting in particular that it would not have adverse consequences for the planning process or entities in the interconnection queue. 13   No one opposed the waiver.  As today’s order observes, the Commission generally considers four factors in evaluating a request for a tariff waiver:  (1) whether the applicant acted in good faith; (2) whether the waiver is of limited scope; (3) whether the waiver addresses a concrete problem; and (4) whether the waiver has undesirable consequences, such as harming third parties. 14

I believe that NYCE’s waiver request satisfies those four criteria and is in the public interest.  First, I see nothing in the record—or today’s order—indicating that NYCE did not act in good faith.  After all, it does not strike me as totally unreasonable to assume that, if an oil/natural-gas fired unit can pass environmental muster, then a non-emitting battery storage facility is likely to clear that bar as well.  In any case, the record indicates that, after learning of NYISO’s final determination, NYCE promptly offered to make the additional deposit. 15   Second, I believe that the waiver request is limited in scope insofar as it applies only to this facility and only to this single failure to comply with the applicable deadlines.  Third, the waiver request remedies a concrete problem wherein a resource that is progressing towards development and is willing to put up the additional collateral required by the Tariff would lose its interconnection queue position because of a misinterpretation of the Tariff—one my colleagues also recognize was made with no “ill intent.” 16 Finally, I agree with NYISO that granting the waiver would not have undesirable consequences, such as harming third parties. 17

The Commission, however, rejects the waiver request, concluding that it both was not made in good faith and is not limited in scope.  On good faith, the Commission’s position is that NYCE has not shown good faith because it could have submitted the additional deposit at that outset rather than trying to prove that it met the regulatory milestone. 18 That is true enough, but I also understand why NYCE sought to rely on its previous environmental determinations rather than fork over an additional quarter-million dollars in collateral. 19   The fact that NYCE could have—and, in hindsight, should have—taken a different path does not, in my view, indicate that it acted in bad faith. 20

On the scope of the waiver request, the Commission finds that NYCE has failed to “provide a compelling reason why it should be afforded special treatment.” 21   In other words, the Commission suggests that the waiver request is not limited in scope because NYCE has not shown that it deserves a waiver. 22   That seems to be beside the point.  We can disagree about whether NYCE’s request deserves to be granted or whether NYCE deserves to be treated differently than other interconnecting resources, but that hardly seems relevant to whether the particular waiver request in front of us is limited in scope.  Accordingly, I disagree that NYCE has failed to satisfy any prong of the four-part waiver test.   

For these reasons, I respectfully dissent.







 

• 11 Waiver Request at 2.
• 22 NYISO Comments at 2.
• 33 Id.
• 44 Id.
• 55 Id.
• 66 Waiver Request at 2.
• 77 Id. at 3. NYISO determined that this was a non-material change in technology for the purpose of maintaining its queue position. Id. at 1-2.
• 88 Id. at 3.
• 99 Id.; NYISO Comments at 3 & n.6.
• 1010 NYISO Comments at 2-3 & n.6.
• 1111 Waiver Request at 3.
• 1212 NYISO Comments at 3.
• 1313 NYISO Comments at 4-5.
• 1414 NYC ENERGY LLC, 170 FERC ¶ 61,230, at P 13 (2020) (Order).
• 1515 Waiver Request at 1. The Majority contends that I “do[] not acknowledge” that, by that point, the payment was untimely. Order, 170 FERC ¶ 61,230 at n.30. Of course it was untimely; that is why NYCE had to file this waiver request. But that hardly shows that NYCE did not act in good faith.
• 1616 Order, 170 FERC ¶ 61,230 at P 14.
• 1717 NYISO Comments at 5.
• 1818 Order, 170 FERC ¶ 61,230 at P 14.
• 1919 As noted, the additional collateral requirement is $3,000 per MW, NYISO Comments at 2, which comes out to $240,000 for an 80 MW facility.
• 2020 The Majority states that I failed to note that the relevant environmental determinations were issued years ago. Order, 170 FERC ¶ 61,230 at n.31. But nothing in this record—certainly not NYISO’s comments—suggest that the age of the environmental determinations was at all relevant to NYISO’s finding that NYCE had not complied with Attachment S.
• 2121 Id. P 15.
• 2222 As I have previously noted, any third-party tariff waiver request is, by definition, a request for special treatment since it is asking for a departure from the generally applicable tariff language. See Enerwise Global Techs., Inc., 170 FERC ¶ 61,084, at P 4 (2020)