California Independent System Operator Corporation June 22, 2018 The Honorable Kimberly D. Bose Secretary Federal Energy Regulatory Commission 888 First Street, NE Washington, DC 20426 Re: California Independent System Operator Corporation ER18- -000 Revisions to Transmission Control Agreement Dear Secretary Bose: The California Independent System Operator Corporation (CAISO) submits for filing and acceptance changes to the Transmission Control Agreement (TCA) among the CAISO and the current participating transmission owners to include a new participating transmission owner, Citizens Sycamore- Penasquitos Transmission LLC (CSPT), and to make minor additional changes.1 The CAISO requests that the TCA changes be made effective on August 31, 2018. This is the projected closing date whereupon CSPT will acquire from San Diego Gas & Electric Company (SDG&E) an interest of approximately 12.92 percent of the transfer capability of an underground segment of the Sycamore-to- Penasquitos 230 kV transmission project currently under construction (Sycamore-Penasquitos transmission project), and CSPT will thereby become a participating transmission owner. Alternatively, if CSPT should perfect its interest in the Sycamore-Penasquitos transmission project on another date, the CAISO requests that the TCA changes take effect upon the closing of the transaction, subject to the compliance filing requested below. I. Background of the TCA The TCA is the agreement among the CAISO and participating transmission owners that establishes the terms and conditions under which transmission owners place certain transmission facilities and entitlements under the CAISO’s operational control, thereby becoming participating transmission owners. The TCA describes how the CAISO and each participating transmission owner will discharge their respective duties and responsibilities with respect to the operation of those facilities and entitlements. 1 This filing is submitted pursuant to Section 205 of the Federal Power Act, 16 U.S.C. § 824d. www.caiso.com │ 250 Outcropping Way, Folsom, CA 95630 │ 916.351.4400 Honorable Kimberly D. Bose June 22, 2018 Page 2 The initial TCA was filed as part of the comprehensive “Phase II” filings submitted by the trustee on behalf of the CAISO on March 31, 1997. Refinements to the TCA were made as a result of an ongoing stakeholder process, and a revised TCA was submitted on August 15, 1997, in compliance with the Commission’s order in Pacific Gas and Electric Company, 80 FERC ¶ 61,128 (1997). In its order dated October 30, 1997, the Commission granted interim and conditional authorization to the CAISO to commence operations and required certain modifications to the TCA.2 The CAISO filed the revised TCA on February 20, 1998. By order dated March 30, 1998, the Commission conditionally accepted the TCA for filing to become effective on the CAISO operations date and required further modifications to be made in a compliance filing within 60 days of the CAISO operations date.3 Additional amendments to the TCA have been made to add new participating transmission owners and for other purposes. The most recent amendment to the TCA was filed in Docket No. ER17-694-000 and accepted by Commission letter order dated February 24, 2017.4 II. Proposed TCA Changes The changes to add CSPT as a new participating transmission owner are reflected in the TCA table of contents, signature pages, and appendices for CSPT and SDG&E. There is one additional change in the body of the TCA that applies to CSPT. Also, SDG&E has taken this opportunity to make other updates to its versions of appendix A (which contains tables listing facilities and entitlements of the participating transmission owners) and appendix B (which contains tables listing encumbrances of the participating transmission owners).5 Lastly, the TCA has been updated to reflect a participating transmission owner’s name change from Atlantic Path 15, LLC to Duke-American Transmission Company (DATC) Path 15, LLC. The CAISO is not aware of any objection to the proposed changes by any of the current participating transmission owners.6 A. Changes to Add CSPT 2 Pac. Gas and Elec. Co., et al., 81 FERC ¶ 61,122. 3 Cal. Indep. Sys. Operator Corp., 82 FERC ¶ 61,325, at 62,276-79 (1998). The CAISO submitted the required compliance filing on June 1, 1998. 4 Cal. Indep. Sys. Operator Corp., 152 FERC 62,137 (2017). 5 The CAISO has also restored Commission-approved language in appendix B.2 to appendix A (SDG&E’s list of contract encumbrances) that was included in the TCA as recently as the CAISO’s filing in Docket No. ER11-2295-001 but was inadvertently omitted from the CAISO’s subsequent filings to amend the TCA. 6 The signature pages for the CAISO, SDG&E, and CSPT are being submitted with this filing. An updated signature page for DATC Path 15, LLC is also being submitted with this filing. www.caiso.com Honorable Kimberly D. Bose June 22, 2018 Page 3 The changes proposed to include CSPT as a participating transmission owner include updates to the TCA table of contents, a signature page, additions to appendix A to identify CSPT’s entitlements, and additions to appendix B to identify CSPT’s encumbrances.7 The transmission facilities that CSPT will have an interest in will be under CAISO operational control and will be included in the CAISO transmission register. The CAISO also proposes to add new TCA section 4.4.8 to address any concerns about the possibility that CSPT might recover all or a portion of its revenue requirement for the high voltage transmission assets it acquired in the Sycamore-Penasquitos transmission project and then subsequently seek to withdraw those interests from the CAISO’s operational control and operate them as transmission rights not subject to the Commission’s jurisdiction. These provisions are modeled on existing TCA sections 4.4.4, 4.4.5, 4.4.6, and 4.4.7, which were incorporated into the TCA to address similar concerns relating to Trans Bay Cable LLC, Startrans IO, L.L.C., Citizens Sunrise Transmission LLC, and GridLiance West Transco LLC when they proposed to become parties to the TCA. The proposed provisions of section 4.4.8 specify essentially the same rights and obligations for CSPT. These provisions recognize the benefit conferred on CSPT through its transmission revenue requirement become participating transmission owners under the TCA. Consequently, the CAISO requests that the Commission accept section 4.4.8 for the same reasons that the Commission previously accepted similar provisions for other parties to the TCA.8 B. Changes to SDG&E’s Appendix A and Appendix B of the TCA The changes proposed for SDG&E include the removal of the Mutual Assistance Transmission Agreement due to the termination of that agreement on January 1, 2018, the removal of the SONGS Participation Agreement due to the shutdown of the San Onofre Nuclear Generating Station, and updates to SDG&E’s entitlements that reflect its rights with regard to the Sycamore-Penasquitos transmission project. 7 A copy of the CAISO Governing Board memorandum and resolution accepting CSPT’s application to become a participating transmission owner is included as Attachment C. 8 See, e.g., Cal. Indep. Sys. Operator Corp., 117 FERC ¶ 61,029 (2006) (order accepting revisions to the TCA to include Trans Bay Cable LLC). www.caiso.com Honorable Kimberly D. Bose June 22, 2018 Page 4 C. Name Change from Atlantic Path 15, LLC to DATC Path 15, LLC Pursuant to a transaction consummated in 2013,9 Atlantic Path 15, LLC has changed its name to DATC Path 15, LLC. The name change is reflected in the TCA table of contents, signature pages, and appendix A contained in this filing. III. Effective Date and Request for Waiver The CAISO requests the proposed changes to the TCA contained in this filing become effective on August 31, 2018, to accommodate the addition of CSPT as a party to the TCA. This is the anticipated closing date and also the date that CSPT would become a participating transmission owner. The actual effective date of the proposed changes to include CSPT as a new participating transmission owner, including CSPT’s appendix A and the changes to the SDG&E appendix A, should coincide with the actual closing date between SDG&E and CSPT. Accordingly, the CAISO requests the Commission direct the CAISO to submit a compliance filing to revise the effective date of these proposed changes in the event the transaction between SDG&E and CSPT closes on a date other than the requested effective date for the changes to the CSPT appendix A and the SDG&E appendix A. Over the course of its operations, the CAISO has become accustomed to implementing Commission-ordered revisions to transmission revenue requirements and the associated revisions to its transmission access charges to become effective on dates as necessary to support schedules associated with the addition of transmission facilities and other transactions involving entitlements.10 Consequently, the CAISO is willing to forego its usual preference for implementation of transmission access charge revisions for new participating transmission owners on July 1 or January 1 as prescribed by CAISO tariff section 4.3.1.1, since the effective dates requested for CSPT and SDG&E appendix A are other than January 1. Accordingly, the CAISO hereby respectfully requests any waiver, if necessary, by the Commission of the provisions of CAISO tariff section 4.3.1.1 – and the related provisions of CAISO tariff appendix F, schedule 3, section 8.1 – in order to implement the effective date of CSPT and SDG&E appendix A of August 31, 2018. The granting of any necessary waiver of these CAISO tariff provisions by the Commission, in conjunction with its order establishing the effective date of the CSPT and SDG&E appendix A changes, 9 See Atlantic Path 15, LLC, 143 FERC ¶ 62,025 (2013). 10 See, e.g., Cal. Indep. Sys. Operator Corp., 109 FERC ¶ 61,153, at Ordering Paragraph (B) (2004) (accepting revisions to TCA effective November 1, 2004 as proposed by the CAISO); Cal. Indep. Sys. Operator Corp., 139 FERC ¶ 61,198 at P 18 (2012); Cal. Indep. Sys. Operator Corp., Commission Letter Order, Docket No. ER13-71-000 (Nov. 6, 2012). www.caiso.com Honorable Kimberly D. Bose June 22, 2018 Page 5 should resolve any concerns that other participating transmission owners may express. The Commission has granted waiver of tariff provisions where: (1) the applicant acted in good faith; (2) the waiver is of limited scope; (3) the waiver addresses a concrete problem; and (4) the waiver does not have undesirable consequences, such as harming third parties.11 All of these criteria are satisfied by the requested waiver. The CAISO is acting in good faith to address the effective date issue described above. The waiver is of limited scope because it applies only to two provisions in the CAISO tariff in order to permit the requested effective date for certain provisions in the TCA. The waiver addresses the concrete problem that the tariff provisions for which the CAISO requests waiver would otherwise be at variance with the requested effective date. Lastly, the waiver does not have undesirable consequences and instead will resolve any concerns that other participating transmission owners may express. Therefore, the Commission should grant the requested waiver if necessary. IV. Attachments In addition to this transmittal letter, the following documents support the instant filing: Attachment A: Proposed clean version of the TCA as revised by this filing; Attachment B: Red-lined document showing the proposed changes to the TCA; and Attachment C: CAISO Governing Board memorandum and resolution. V. Service Copies of this filing, including all attachments, have been served upon the Public Utilities Commission of the State of California, the California Energy Commission, the participating transmission owners, CSPT, and all parties with effective Scheduling Coordinator Agreements under the CAISO tariff. In addition, the CAISO has posted the filing and all attachments on the CAISO website. 11 See, e.g., Midcontinent Indep. Sys. Operator, Inc., 154 FERC ¶ 61,059, at P 14 (2016); Calpine Energy Serv., Inc., 154 FERC ¶ 61,082, at P 12 (2016); New York Power Auth., 152 FERC ¶ 61,058, at P 22 (2015). www.caiso.com Honorable Kimberly D. Bose June 22, 2018 Page 6 VI. Correspondence Pursuant to Commission Rule 203(b)(3),12 the CAISO requests that all correspondence, pleadings, and other communications concerning this filing be served upon the following: John C. Anders Assistant General Counsel California Independent System Operator Corporation 250 Outcropping Way Folsom, CA 95630 Tel: (916) 608-7278 Fax: (916) 608-7222 Email: [email protected] VII. Conclusion The CAISO respectfully requests that the Commission accept this filing and permit the proposed TCA changes to be effective as of the dates requested. Respectfully submitted, By: /s/ John C. Anders Roger E. Collanton General Counsel Burton A. Gross Deputy General Counsel John C. Anders Assistant General Counsel California Independent System Operator Corporation 250 Outcropping Way Folsom, CA 95630 Tel: (916) 608-7278 Fax: (916) 608-7222 Email: [email protected] Attorneys for the California Independent System Operator Corporation 12 18 C.F.R. § 385.203(b)(3). www.caiso.com Attachment A – Clean Tariff Records Revisions to Transmission Control Agreement California Independent System Operator Corporation TABLE OF CONTENTS Section 1. DEFINITIONS ............................................................................................................... 2. PARTICIPATION IN THIS AGREEMENT ..................................................................... 3. EFFECTIVE DATE, TERM AND WITHDRAWAL .......................................................... 4. TRANSFER OF OPERATIONAL CONTROL ................................................................ 5. INDEPENDENT SYSTEM OPERATOR ........................................................................ 6. PARTICIPATING TRANSMISSION OWNERS ............................................................. 7. SYSTEM OPERATION AND MAINTENANCE .............................................................. 8. CRITICAL PROTECTIVE SYSTEMS THAT SUPPORT CAISO CONTROLLED GRID OPERATIONS ................................................................... 9. SYSTEM EMERGENCIES ............................................................................................ 10. CAISO CONTROLLED GRID ACCESS AND INTERCONNECTION .......................... 11. EXPANSION OF TRANSMISSION FACILITIES ......................................................... 12. USE AND ADMINISTRATION OF THE CAISO CONTROLLED GRID ....................... 13. EXISTING AGREEMENTS ......................................................................................... 14. MAINTENANCE STANDARDS ................................................................................... 15. DISPUTE RESOLUTION ............................................................................................ 16. BILLING AND PAYMENT............................................................................................ 17. RECORDS AND INFORMATION SHARING .............................................................. 18. GRANTING RIGHTS-OF-ACCESS TO FACILITIES ................................................... 19. [INTENTIONALLY LEFT BLANK] ................................................................................ 20. TRAINING ................................................................................................................... 21. OTHER SUPPORT SYSTEMS REQUIREMENTS ..................................................... 22. LIABILITY .................................................................................................................... 23. UNCONTROLLABLE FORCES .................................................................................. 24. ASSIGNMENTS AND CONVEYANCES ..................................................................... 25. CAISO ENFORCEMENT ............................................................................................ 26. MISCELLANEOUS ...................................................................................................... 27. SIGNATURE PAGE CALIFORNIA INDEPENDENT SYSTEM OPERATOR CORPORATION ................................................................................ 28. SIGNATURE PAGE PACIFIC GAS AND ELECTRIC COMPANY .............................. 29. SIGNATURE PAGE SAN DIEGO GAS & ELECTRIC COMPANY .............................. 30. SIGNATURE PAGE SOUTHERN CALIFORNIA EDISON COMPANY ....................... 31. SIGNATURE PAGE CITY OF VERNON ..................................................................... 32. SIGNATURE PAGE CITY OF ANAHEIM .................................................................... 33. SIGNATURE PAGE CITY OF AZUSA ........................................................................ 34. SIGNATURE PAGE CITY OF BANNING .................................................................... 35. SIGNATURE PAGE CITY OF RIVERSIDE ................................................................. 36. SIGNATURE PAGE OF DATC PATH 15, LLC ............................................................ 37. SIGNATURE PAGE OF WESTERN AREA POWER ADMINISTRATION, SIERRA NEVADA REGION ................................................... 38. SIGNATURE PAGE OF CITY OF PASADENA ........................................................... 39. SIGNATURE PAGE OF TRANS BAY CABLE LLC ..................................................... 40. SIGNATURE PAGE OF STARTRANS IO, L.L.C. ....................................................... 41. SIGNATURE PAGE OF CITIZENS SUNRISE TRANSMISSION LLC ........................ 42. SIGNATURE PAGE OF CITY OF COLTON ............................................................... 43. SIGNATURE PAGE OF VALLEY ELECTRIC ASSOCIATION, INC. ........................... 44. SIGNATURE PAGE OF GRIDLIANCE WEST TRANSCO LLC .................................. 45. SIGNATURE PAGE OF CITIZENS SYCAMORE-PENASQUITOS TRANSMISSION LLC .............................................................................................