Commissioner See’s Dissent Regarding ISO New England Inc.

Docket No. ER25-3253-000

Some dissents are reluctant.  This is one of them.  I am sympathetic to Brookfield’s plight—it followed ISO-NE’s Tariff yet received (and paid) a Performance Penalty Charge due to ISO-NE’s admitted dispatch error.  Unfortunately, the Tariff lacks a mechanism to correct that error.  That’s why ISO-NE is coming to us: As the majority’s order explains, the parties need a Tariff waiver to make things right.  But regrettably, the requested waiver is retroactive and thus violates the filed rate doctrine.  The Commission doesn’t have power to grant that kind of relief. 

After the dispatch error on June 24, 2025, ISO-NE issued the initial settlement of Capacity Performance Payment calculations to market participants, including Brookfield, on July 14, 2025.  ISO-NE issued Brookfield’s negative Performance Payment Charge after performing the calculation Tariff section III.13.2.7.6 requires, yet did not seek this waiver until August 20.  In other words, ISO-NE has already applied the Tariff provision it now asks the Commission to waive.[1]  That’s the definition of retroactive relief: The ISO wants to unring the bell, not get permission to keep from ringing it in the first place.

ISO-NE argues that its request is prospective because, consistent with the Tariff, it will not issue Brookfield’s final bill until November 10.  I cannot agree.  At bottom, issuing a corrected bill requires undoing past action that led to the initial penalty Brookfield has already paid.  The Commission has denied relief on similar facts because of retroactivity and filed-rate-doctrine concerns.[2]  More generally, the Commission has denied waiver where the applicant sought to recover costs incurred before the applicant filed its request: In denying relief under the filed rate doctrine and the rule against retroactive ratemaking, the Commission reasoned that ratepayers had not received sufficient notice that the rate was subject to change.[3]  Similarly, the Tariff here provides no notice that the Performance Payment Charge could be refunded—whether before the final bills issue or later.

The Tariff itself also refutes ISO-NE’s case for granting error-correction relief before issuing final bills.  The Tariff allows the ISO to correct some errors before issuing the final bill.  Section III.3.6 explains that ISO-NE “will correct data handling errors associated with other Market Participant supplied data to the extent that such data did not impact unit commitment or the Real-Time dispatch.”  But that provision does not apply here where the data was accurately reported.  Regardless, the dispatch error “impact[ed] unit commitment or the Real-Time dispatch” because ISO-NE’s June 24 operational decision affected real-time operation by holding down the Harris 2 unit.

More to the point, by delineating a subset of “correctable” matters, the Tariff necessarily implies that others are final after the initial assessment.  In fact, the Tariff is explicit in section III.3.6 that “data handling errors that impacted unit commitment or the Real-Time dispatch will not be corrected.”  And section III.3.7 doubles down: Errors eligible for billing adjustments must “not affect the day-ahead schedule or real-time dispatch.”  The result is that the Tariff not only fails to contemplate that errors outside section III.3.6’s reach could be corrected before a final bill goes out, the Tariff explicitly says that the error in question here will not be corrected.  Allowing ISO-NE to change the initial assessment and issue a refund on non-data-handling-error grounds thus requires changing Tariff rules after they’ve been applied. 

I recognize denying the waiver would not lead to an equitable result.  Indeed, I have no quarrel with the majority’s analysis under the four prongs of our waiver test.  But we lack authority to apply that equitable framework where doing so violates the filed rate doctrine.  As the D.C. Circuit put it, “[t]he filed rate requirement is stringent and admits of no equitable adjustments by the Commission or this court.”[4]  Genuine sympathy for Brookfield under these facts cannot overcome an unlawful remedy.

Sticking to the hard conclusion here would uphold the filed rate doctrine’s cornerstone principle that ratepayers are entitled to sufficient notice before the rules change.  At the same time, no one wants to see a costly error go uncorrected.  I encourage ISO-NE to explore revising its Tariff to prevent similar predicaments in the future.  (A Tariff without sufficient error-correction protections might even raise questions about its justness and reasonableness.) 

Given the facts of this case, I respectfully dissent from today’s order.