S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  1216

                       2015-2016 Regular Sessions

                          I N  A S S E M B L Y

                             January 8, 2015
                               ___________

Introduced  by M. of A. BRENNAN -- read once and referred to the Commit-
  tee on Corporations, Authorities and Commissions

AN ACT to amend the public service law, in relation  to  abolishing  the
  market clearing price

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1.  Section 66 of the public service law is amended by  adding
three new subdivisions 29, 30 and 31 to read as follows:
  29.  REVIEW  THE  RATES  OF  ANY  PUBLIC  UTILITY  ON AN ANNUAL BASIS,
PROVIDED HOWEVER THAT UPON A DETERMINATION BY THE  COMMISSION  THAT  THE
PUBLIC  INTEREST  DOES  NOT REQUIRE SUCH ANNUAL RATE REVIEW, A REVIEW OF
RATES MAY BE UNDERTAKEN AT NO MORE THAN THREE YEAR INTERVALS.
  30. (A) USE THE FULLEST EXTENT OF ITS POWERS TO REGULATE THE  DISTRIB-
UTION OF RETAIL ELECTRIC ENERGY TO RETAIL CUSTOMERS IN THE STATE AND, TO
THE  EXTENT  NOT PROHIBITED BY FEDERAL LAW, THE TRANSMISSION OF ELECTRIC
ENERGY IN THE STATE.
  (B) A MARKET CLEARING PRICE MECHANISM FOR THE PURCHASE OF POWER  SHALL
BE  FORBIDDEN  FOR PURCHASES MADE THROUGH THE WHOLESALE MARKET VIA A BID
PROCUREMENT OR AUCTION PROCESS HELD BY THE INDEPENDENT  SYSTEM  OPERATOR
("ISO")  OF NEW YORK, OR ANY SUCCESSOR IN LAW AND FUNCTION TO SUCH ENTI-
TY.
  (C) SUCH AUCTION OR BID PROCUREMENT PROCESS SHALL BE OVERSEEN  BY  THE
COMMISSION,  WHICH  SHALL REQUIRE A DESCENDING CLOCK, PAY-AS-BID AUCTION
IN WHICH BID AMOUNTS WILL CONTINUE TO FALL UNTIL NO BIDDER IS WILLING TO
SUPPLY ELECTRICITY AT A LOWER PRICE. FOR THE PURPOSES  OF  THIS  ARTICLE
"DESCENDING  CLOCK  AUCTION" SHALL BE DEFINED AS AN AUCTION IN WHICH THE
PRICES DROP THROUGHOUT AN AUCTION  OF  TIME-LIMITED  DURATION;  STARTING
HIGH AND BEING REDUCED GRADUALLY UNTIL THE SUPPLY BID IS JUST SUFFICIENT
TO  MEET  THE ELECTRICAL LOAD TO BE PROCURED. PRICES THAT TICK DOWN IN A
ROUND DECREASE BY A DECREMENT; WHICH IS A GIVEN PERCENTAGE OF THE PREVI-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD02311-01-5

              

A. 1216                             2

OUS PRICE. BIDDERS HOLDING THE FINAL BIDS WHEN THE  AUCTION  CLOSES  ARE
THE WINNERS.
  (D)  BIDDERS  WILL  BE FORBIDDEN FROM KNOWING WHEN THE AMOUNT OF ELEC-
TRICITY SUPPLY FILLS REQUIREMENTS.
  (E) THE COMMISSION SHALL APPOINT  AN  INDEPENDENT  MARKET  ADVISOR  TO
REVIEW  MARKET  PRACTICES  AND  BEHAVIOR; THAT WILL RECOMMEND TO THE ISO
ACTIONS THAT CAN BE TAKEN TO MITIGATE  OR  CORRECT  BEHAVIOR  BY  MARKET
PARTICIPANTS  THAT  WAS  REASONABLY  CALCULATED TO, OR HAD THE EFFECT OF
AFFECTING THE FUNCTION OF THE AUCTION PROCESS SO THAT THE WINNING BIDDER
WAS NOT THE LOWEST PRICE BIDDER.
  (F) UTILITIES MAY BUY POWER FROM MARKETS OTHER THAN THE  ISO,  OR  VIA
CONTRACTS  WITH  INDIVIDUALS  OR GROUPS OF GENERATING ENTITIES, PROVIDED
THAT SUCH ELECTRICAL ENERGY MUST BE OFFERED TO  CUSTOMERS  AT  JUST  AND
REASONABLE RATES.
  31.  (A)  THE COMMISSION SHALL EXERCISE ITS FULL JURISDICTION OVER THE
ISO OF NEW YORK.
  (B) THE COMMISSION SHALL REGULATE THE RELIABILITY, QUALITY AND MAINTE-
NANCE BY TRANSMITTERS AND DISTRIBUTORS OF THEIR TRANSMISSION AND  RETAIL
DISTRIBUTION SYSTEMS.
  (C)  THE  COMMISSION  SHALL REGULATE THE RELIABILITY, QUALITY, MAINTE-
NANCE, AND PRICE OF GENERATORS.
  (D) THE COMMISSION SHALL NOT REQUIRE ANY INCUMBENT ELECTRIC UTILITY TO
DIVEST ITSELF OF ANY GENERATION,  TRANSMISSION  OR  DISTRIBUTION  ASSETS
PURSUANT  TO  ANY PROVISION OF THIS CHAPTER WITHOUT SPECIFIC AUTHORIZING
LEGISLATION FOR SUCH PURPOSE.
  (E) THE COMMISSION  SHALL  DEVELOP  CODES  OF  CONDUCT  GOVERNING  THE
CONDUCT  OF INCUMBENT ELECTRIC UTILITIES AND AFFILIATES THEREOF WHEN ANY
SUCH AFFILIATES PROVIDE, OR CONTROL ANY  ENTITY  THAT  PROVIDES,  GENER-
ATION, DISTRIBUTION, OR TRANSMISSION SERVICES TO THE EXTENT NECESSARY TO
PREVENT IMPAIRMENT OF COMPETITION. NOTHING IN THIS CHAPTER SHALL PREVENT
AN  INCUMBENT  ELECTRIC  UTILITY  FROM  OFFERING METERING OPTIONS TO ITS
CUSTOMERS.
  S 2. This act shall take effect immediately.