© 2000-2012 New York Independent System Operator, Inc.  All Rights Reserved.

New Challenges Facing System OperatorsStephen G. WhitleyPresident & Chief Executive OfficerNew York Independent System Operator

Past Present and Future of the Power GridA Cornell University workshop in honor of Robert J. ThomasIthaca, NYAugust 9, 2012

© 2000-2012 New York Independent System Operator, Inc.  All Rights Reserved.

Topics• Growth of the Grid• Renewable Resources• Demand Response• Advancing Technology• Regional Collaboration

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Growth of the Grid

Pearl Street Station distribution area, New York, Image 69231, Electricity & Modern Physics Collection. National Museum of American History - Smithsonian Institution

1882Pearl Street Station

59 customers

600 kW of generation

10.5 miles of main lines

2012New York Control Area

7 million electric utility customers

43,000,000 kWof generating capacity,

transmission capability & demand-response

11,000 circuit-miles of high-voltage transmission

© 2000-2012 New York Independent System Operator, Inc.  All Rights Reserved.

Looking Ahead• Integrating Renewable Resources• Empowering Consumers• Advancing Technology• Enhancing Collaboration

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Wind Power• 2006 – NYISO exempts wind from undergeneration

penalties as a variable energy resource• 2008 – NYISO establishes centralized wind

forecasting system established• 2009 – NYISO integrates wind into Economic

Dispatch system (First in nation)

Growing wind in NY… Wind-powered generating capacity in NY grew

from 48 MW in 2005 to 1,414 MW in 2012 Another 4,000 MW of wind projects proposed

for interconnection to NY grid

© 2000-2012 New York Independent System Operator, Inc.  All Rights Reserved.

2009 -- NYISO implements first market rules in US enabling storage systems to participate in the markets as frequency regulation providers

Energy storage complements development of variable energy resources

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Energy Storage

NY’s Energy Storage Firsts… First commercial grid-scale battery-based storage

system to operate as a generator in the US First full-scale flywheel energy storage facility to

provide frequency regulation service in the US

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2012 – NYISO exempts solar power from under-generation penalties to compensate solar fully for all energy production

Future – Market evolution for solar resources likely to parallel wind power initiatives

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Solar Power

Grid-scale solar in NY… The largest photovoltaic array in the

eastern US is the 32-MW Long Island Solar Farm at Brookhaven National Laboratory – completed in Nov. 2011

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Demand Response

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Shaving the Peak

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NYCA 2011 Peak DayWith & Without Demand Response

20,000

22,000

24,000

26,000

28,000

30,000

32,000

34,000

36,000

38,000

1 2 3 4 5 6 7 8 9 1011 12 13 1415 16 171819 202122 2324

Actual Without Demand Response

Actual Load with DR

Estimated Load without DR

July 2011 heat waves could have

pushed demand to over 35,000 MW

-- a new record peak -- had DR

programs not served to reduce

load by more than 1,400 MW

© 2000-2012 New York Independent System Operator, Inc.  All Rights Reserved.

Dynamic Pricing

NYISO/Brattle Group Study Dynamic pricing can encourage shift to off-peak usage Potential 10-14% reduction in system peak Market-based customer cost reductions of 2-5%

Impact of Dynamic Pricing on Hourly Loads

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Smart Grid Smart Grid Investment Grant (SGIG)

Three-Year project -- $74 Million (DOE SGIG funding of $37 Million to cover 50% of project cost)

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Project components Creation of a statewide Phasor

Measurement Network Installation of Capacitor Banks

Enhanced reliability PMU Installation one of key DOE recommendations

from 2003 blackout study endorsed by FERC and NERC

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NYISO Infrastructure New state-of-the-art

primary control center in a facility adjacent to existing corporate center

Renovation of 42-year-old power control facility to serve as alternate control center Existing

Corporate Center

New Primary Power Control

Center

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Regional Collaboration• Broader Regional Markets

Address “seams” between regional markets and grid operations

Collaborative effort - NYISO, PJM Interconnection, Midwest ISO, ISO- New England, Ontario’s Independent System Operator and Hydro Quebec

More frequent scheduling can facilitate better regional integration of variable, renewable resources

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Interregional Planning

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Eastern Interconnection Planning Collaborative 25 electric system planning

authorities in U.S. and Canada representing 95% of Eastern Interconnection

Grassroots effort to integrate local planning interconnection-wide

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Moving Forward

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The New York Independent System Operator (NYISO) is a not-for-profit corporation

responsible for operating the state’s bulk electricity grid, administering New York’s competitive wholesale electricity markets,

conducting comprehensive long-term planning for the state’s electric power system, and

advancing the technological infrastructure of the electric system serving the Empire State.

www.nyiso.com