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FERC Approves NYISO Plan for Wind Forecasting, Under-Generation Exemptions

June 24, 2008

In a move intended to encourage the development of wind and other renewables as well as integrate them more effectively into the resource mix, the Federal Energy Regulatory Commission (FERC) on June 17 approved the New York System Operator’s (NYISO’s) proposed tariff revisions that triple the amount of variable capacity exempt from under-generation charges and also would institute a mandatory wind forecasting mechanism for wind farms.

The approval would raise, from 1,000 MW to 3,300 MW, the amount of variable resources that are both exempt from under-generation charges and eligible for payment for all of the power they produce. The centralized wind forecasting mechanism, which would apply to facilities larger than 12 MW, would use meteorological data collected by interconnected wind resources to forecast the amount of energy expected to be produced by those resources for use in NYISO's day-ahead and real-time markets processes.

Each wind resource would be responsible for the cost of installation and maintenance of any equipment necessary to collect the required data. NYISO also would add a new rate schedule to recover its cost of providing the wind forecasting service. NYISO would use the output forecasts for its commitment and dispatch service, and so its tariff revisions call for making the program mandatory and enforceable, with penalties imposed on entities that do not install the necessary equipment and participate.

“ We are pleased with FERC’s approval of the New York Independent System Operator’s wind forecasting system and market rules for wind energy,” said Carol E. Murphy, executive director of the Alliance for Clean Energy New York. “This is an issue we have worked very hard on and believe will be extremely useful in the successful integration of wind resources into the New York grid.

“The 3,300 MW limit on penalty exemption was put into the rule as a placeholder until completion of another study of integrating wind resources into the market. That study, if done properly, will identify the necessary steps to fully integrate higher levels of wind penetration into the New York Control Area managed by the NYISO.”

Added Murphy, “New York is committed to renewable resources as a means of combating global climate change and enhancing energy security and economic development; making these needed changes to the NYISO’s market rules will help facilitate their smooth integration while ensuring a reliable electricity supply.”

Source: Wind Energy Weekly 1295 (20 June 2008)