Transmission Owner Transmission Solutions

The Transmission Owner Transmission Solutions (TOTS) was a group of three electric power bulk transmission projects constructed on the New York bulk transmission system to increase transfer capability between Upstate New York and Downstate New York. The projects were in-service by June 2016. The projects were proposed by a consortium of the state's seven Investor-Owned Utility (IOU) companies (New York Transco (Transco),[1] composed of Consolidated Edison, Orange and Rockland, PSEG-Long Island, Central Hudson, National Grid, New York State Electric and Gas, and Rochester Gas and Electric) in response to a New York State Public Service Commission (NYSPSC) appeal for Indian Point contingency plans in the event that the 2,060-MW Indian Point power facility were to retire.[2][3] The shutdown of the Indian Point facility has been a policy goal of Governor Andrew Cuomo since before he began his administration in New York in 2011.[4] The TOTS projects are estimated to have costed $240 million[5] to construct. Construction costs were divided between the seven Transco utilities and the New York Power Authority (NYPA). The IOUs are receiving a 10% return on equity (approved by the Federal Energy Regulatory Commission)[6] for construction of the projects which is being recovered through retail consumer rates approved by the NYSPSC.

History

An Indian Point contingency plan, initiated in 2012 by the NYSPSC under the administration of Cuomo, solicited energy solutions from which the TOTS plan was selected. Proposals were solicited from third party developers and the incumbent transmission IOUs. The TOTS projects consist of 3 separate projects that were projected to provide 450 MW[7] of additional transfer capability across a NYISO defined electric transmission corridor. The NYSPSC approved the Certificate of Public Convenience and Necessity for the TOTS projects (usually required before construction of a project) on behalf of Transco on May 19, 2016 (pursuant to section 68 of the Public Service Law).[7] Most other major transmission projects in New York are subject to Article VII of the Public Service Law.[8] These TOTS projects, with the exception of part of the Staten Island "unbottling" were in service by June 2016. The cost of the TOTS projects are distributed among the various IOUs in their rate cases that were approved by the public service commission. The cost allocation amongst themselves was approved by the Federal Energy Regulatory Commission (FERC). NYPA is also receiving a portion of the cost allocation, which they are recovering through tariffs. The cost of the TOTS projects has been estimated to be in the range of between $27 million to $240 million.[2][9][10][11][12]

Facilities
  • Marcy South Series Compensation project: The installation of a 240-MVAR series compensation unit (capacitor bank) at the Fraser Station for a circuit between the Marcy Station and the Fraser Station, reconductoring of a 345-kV circuit between these stations, and the replacement and refurbishment of selected towers.
  • Construction of a second Ramapo station to Rock Tavern station 345-kV circuit.
  • Staten Island Unbottling project: The splitting of a 345-kV underground circuit in Staten Island.

Cost allocation
IOU Cost allocation (%) Estimated Increase in Rate Base ($ mm)
Central Hudson5.9914.4
Con Edison / Orange and Rockland63.18151.6
New York State Electric and Gas / Rochester Gas and Electric10.1224.3
National Grid12.1629.2
Long Island Power Authority (PSEG-Long Island)8.5520.5

Note: "Increase in Rate Base" is based on an estimated $240 million total construction cost without including the FERC approved 10% ROE.[5][6]

Other facilities

Several other facilities have been or are being constructed near Indian Point Energy Center which at one point attempted to qualify for the original 2012 contingency plan solicitation from the NYSPSC.

An energy highway initiative was prompted by the Indian Point Contingency Plan order from 2012 (generally speaking, additional lines on the Edic-Pleasant Valley and the Oakdale-Fraser transmission corridors) which is still going through the regulatory process in both the NYISO and NYSPSC.[13][14]

Other projects include the proposed Champlain Hudson Power Express and the in-service (as of October 1, 2018) CPV Valley Energy plant, a 650 MW natural gas plant located in Wawayanda, New York.[15] The CPV Valley plant has been associated with Governor Cuomo's close aid, Joe Percoco, and the associated corruption trial.[16] There was a 1,000 MW merchant HVDC transmission line proposed in 2013 to the NYSPSC that would have interconnected at Athens, New York and Buchanan, New York, however this project was indefinitely stalled when its proposed southern converter station site was bought by the Town of Cortlandt in a land auction administered by Con Edison.[17][18][19] Another plant being built, Cricket Valley Energy Center, rated at 1,100 MW, is on schedule to provide energy by 2020 in Dover, New York.[20]

New capacity zone

FERC has also been instrumental in developing wholesale market policy in the region of New York that TOTS was designed to alleviate. Approved in 2013 and upheld by a federal appeals court in 2015,[21] a new capacity zone for the NYISO's wholesale capacity market was implemented. Previously, the state only had three locational capacity zones in the wholesale capacity market (rest of state, New York City, and Long Island). The new capacity zone is a fourth zone that extends from the Hudson Valley to New York City and essentially acts as a price floor to the New York City capacity zone price. Historically, the Hudson Valley zone and two other zones north of New York City were located in the lower priced rest-of-state zone. The NYISO's wholesale capacity market provides wholesale energy producers with a revenue stream independent of actual energy production and based upon a unit's power production capability, but it has never been called a standby fee or market.[22][23][24] While the creation of new capacity zones has been historically documented, the NYISO has disallowed policy that would provide the ability to remove a capacity zone in the state if a transmission corridor is deemed unrestrained.[25]

NYSPSC Staff

At least one member of the NYSPSC staff responsible for guiding the TOTS projects through the state regulatory process in the years 2012-2016, Raj Addepalli, retired in 2016 as an office Director with a final salary of $165,489 and a total compensation of $181,178 - the highest level of compensation for the department that year.[26][27]

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References
  1. "New York Transco". www.nytransco.com. Retrieved December 9, 2018.
  2. "NYSPSC case no. 12-E-0503 February 24, 2016 Order". documents.dps.ny.gov. February 24, 2016. Retrieved October 31, 2018.
  3. NYSPSC case no. 12-E-0503
  4. Kaplan, Thomas (March 22, 2011). "For Cuomo and Indian Point, New Round in a Long Fight". www.nytimes.com. Retrieved December 8, 2018.
  5. "New York "Energy Highway Plan" Forces Increase In Monthly Bills". www.engieresources.com. Retrieved December 8, 2018.
  6. Opalka, William (March 21, 2016). "FERC OKs Settlement for NY TOTS Projects". www.rtoinsider.com. Retrieved December 8, 2018.
  7. Linares, Corina Rivera (July 6, 2016). "New York ISO: TOTS projects placed in service in June". www.transmissionhub.com. Retrieved December 8, 2018.
  8. "NYSPSC DMM". documents.dps.ny.gov. Retrieved December 8, 2018.
  9. Opalka, William (November 11, 2015). "Settlement Reached on New York TOTS Projects". www.rtoinsider.com. RTO Insider. Retrieved November 14, 2018.
  10. "Costs for New Transmission Lines in NY Passed Through To You As of June 1st". energywatch-inc.com. Energywatch inc. Retrieved November 14, 2018.
  11. "NYPA Financial Report 2016-2017" (PDF). www.nypa.gov. December 31, 2017. pp. 20, 21, 74. Retrieved November 14, 2018.
  12. "Company Background". www.nytransco.com. Retrieved December 9, 2018.
  13. "NYSPSC AC Transmission website". www.dps.ny.gov. Retrieved December 8, 2018.
  14. "AC Transmission Upgrades - Q&A". www3.dps.ny.gov. Retrieved December 8, 2018.
  15. "CPV Achieves Commercial Operation at 680MW CPV Valley Energy Center New York". www.cpv.com. October 1, 2018. Retrieved October 31, 2018.
  16. James Nani (November 22, 2016). "Corruption Indictment Details Charges Against Former CPV Exec Ex Cuomo Aide". www.recordonline.com. Times Herald-Record. Retrieved October 31, 2018.
  17. NYSPSC DMM Case No. 13-T-0292
  18. "WPP Letter to ALJ asking for suspension of schedule". documents.dps.ny.gov. October 29, 2014. Retrieved November 13, 2018.
  19. "WPP Website". westpointproject.com. Retrieved November 13, 2018.
  20. Amy Wu (May 30, 2018). "Cricket Valley Energy Center Target 2020 Open". www.poughkeepsiejournal.com. Poughkeepsie Journal. Retrieved October 31, 2018.
  21. Troutman Sanders LLP (April 14, 2015). "Second Circuit Upholds FERC's NYISO Capacity Zone Order". troutmansandersenergyreport.com. Retrieved December 9, 2018.
  22. "FERC Approves NYISO's Proposal to Establish a New Capacity Zone". business.directenergy.com. September 17, 2013. Retrieved December 9, 2018.
  23. Walton, Robert (December 17, 2014). "NYISO: New NY capacity zone is boosting reliability". www.utilitydive.com. Retrieved December 9, 2018.
  24. Bonds News (September 26, 2013). "New York seeks delay of costly FERC power capacity zone decision". www.reuters.com. Retrieved December 9, 2018.
  25. Heidorn Jr., Rich (April 26, 2018). "NYISO Board Rejects Appeals on Capacity Votes". www.rtoinsider.com. Retrieved December 9, 2018.
  26. Addepalli, Raj (September 30, 2013). "Indian Point Contingency Proposal to NYS Senate Energy and Telecommunications Committee" (PDF). media.gractions.com. Retrieved December 9, 2018.
  27. "Seethroughny.net Payrolls "public service commission"". www.seethroughny.net. Retrieved December 9, 2018.
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