Common use of Inter-Zonal Congestion Management Clause in Contracts

Inter-Zonal Congestion Management. 7.2.5.1 The scheduling procedures in the Day-Ahead Market and Hour-Ahead Market will first ascertain, through power flow calculations, whether or not Inter- 7.2.5.2 The purpose of Inter-Zonal Congestion Management is to allocate the use of, and determine the marginal value of, active Inter-Zonal Interfaces. Inter-Zonal Congestion Management will comply with the requirements stated in Sections 7.2.2, 7.2.4 and 7.2.5. 7.2.5.2.1 Inter-Zonal Congestion Management will keep each Scheduling Coordinator's portfolio of Generation and Demand (i.e., the Scheduling Coordinator's Preferred Schedule) separate from the portfolios of the other Scheduling Coordinators, as the ISO adjusts the Schedules to alleviate Inter-Zonal Congestion. 7.2.5.2.2 If Congestion would exist on one or more active Inter-Zonal Interfaces, then the ISO shall execute its Inter-Zonal Congestion Management algorithms to determine a set of tentative (in the Day-Ahead procedure) allocations of Inter-Zonal Interface rights and tentative (in the Day-Ahead procedure) Usage Charges, where the Usage Charges will be calculated as the marginal values of the Congested Inter-Zonal Interfaces. The marginal value of a Congested Inter-Zonal Interface is calculated by the ISO’s computer optimization algorithm to equal the total change in redispatch costs (based on the Adjustment Bids) that would result if the interface’s scheduling limit was increased by a small increment. 7.2.5.2.3 As part of the Day-Ahead scheduling procedure, but not the Hour-Ahead scheduling procedure, Scheduling Coordinators will be given the opportunity to adjust their Preferred Schedules (including the opportunity to make trades amongst one another) and to submit Revised Schedules to the ISO, in response to the ISO's Suggested Adjusted Schedules and prices for Inter-Zonal Interfaces. 7.2.5.2.4 If the ISO receives any Revised Schedules it will execute its Inter-Zonal Congestion Management algorithms using revised Preferred Schedules, to produce a new set of allocations and prices. 7.2.5.2.5 All of the ISO's calculations will treat each Settlement Period independently of the other Settlement Periods in the Trading Day. 7.2.5.2.6 [Not Used] 7.2.5.2.7 If inadequate Adjustment Bids have been submitted to schedule Inter- Zonal Interface capacity on an economic basis and to the extent that scheduling decisions cannot be made on the basis of economic value, the ISO will allocate the available Inter-Zonal Interface capacity to Scheduling Coordinators in proportion to their respective proposed use of that capacity as indicated in their Schedules and shall curtail scheduled Generation and Demand to the extent necessary to ensure that each Scheduling Coordinator’s Schedule remains balanced. 7.2.5.2.8 The ISO will publish information prior to the Day-Ahead Market, between the iterations of the Day-Ahead Market, and prior to the Hour-Ahead Market, to assist the Scheduling Coordinators to construct their Adjustment Bids so as to actively participate in the management of Congestion and the valuation of Inter-Zonal

Inter-Zonal Congestion Management. 7.2.5.1 The scheduling procedures in the Day-Ahead Market and Hour-Ahead Market will first ascertain, through power flow calculations, whether or not Inter-Inter-Zonal Congestion would exist if all of the Preferred and Revised Schedules submitted by the Scheduling Coordinators were accepted by the ISO. If no Inter-Zonal Congestion would exist, then all Inter-Zonal Interface uses will be accepted and the Usage Charges will be zero. 7.2.5.2 The purpose of Inter-Zonal Congestion Management is to allocate the use of, and determine the marginal value of, active Inter-Zonal Interfaces. Inter-Zonal Congestion Management will comply with the requirements stated in Sections 7.2.2, 7.2.4 and 7.2.5. 7.2.5.2.1 Inter-Zonal Congestion Management will keep each Scheduling Coordinator's portfolio of Generation and Demand Load (i.e., the Scheduling Coordinator's Preferred Schedule) separate from the portfolios of the other Scheduling Coordinators, as the ISO adjusts the Schedules to alleviate Inter-Zonal Congestion. 7.2.5.2.2 If Congestion would exist on one or more active Inter-Zonal Interfaces, then the ISO shall execute its Inter-Zonal Congestion Management algorithms to determine a set of tentative (in the Day-Ahead procedure) allocations of Inter-Zonal Interface rights and tentative (in the Day-Ahead procedure) Usage Charges, where the Usage Charges will be calculated as the marginal values of the Congested Inter-Zonal Interfaces. The marginal value of a Congested Inter-Zonal Interface is calculated by the ISO’s computer optimization algorithm to equal the total change in redispatch costs (based on the Adjustment Bids) that would result if the interface’s scheduling limit was increased by a small increment.and 7.2.5.2.3 As part of the Day-Ahead scheduling procedure, but not the Hour-Ahead scheduling procedure, Scheduling Coordinators will be given the opportunity to adjust their Preferred Schedules (including the opportunity to make trades amongst one another) and to submit Revised Schedules to the ISO, in response to the ISO's Suggested Adjusted Schedules and prices for Inter-Zonal Interfaces. 7.2.5.2.4 If the ISO receives any Revised Schedules it will execute its Inter-Zonal Congestion Management algorithms using revised Preferred Schedules, to produce a new set of allocations and prices. 7.2.5.2.5 All of the ISO's calculations will treat each Settlement Period independently of the other Settlement Periods in the Trading Day. 7.2.5.2.6 [Not Used] 7.2.5.2.7 If inadequate Adjustment Bids have been submitted to schedule Inter- Inter-Zonal Interface capacity on an economic basis and to the extent that scheduling decisions cannot be made on the basis of economic value, the ISO will allocate the available Inter-Inter- Zonal Interface capacity to Scheduling Coordinators in proportion to their respective proposed use of that capacity as indicated in their Schedules and shall curtail scheduled Generation and Demand to the extent necessary to ensure that each Scheduling Coordinator’s Schedule remains balanced. 7.2.5.2.8 The ISO will publish information prior to the Day-Ahead Market, between the iterations of the Day-Ahead Market, and prior to the Hour-Ahead Market, to assist the Scheduling Coordinators to construct their Adjustment Bids so as to actively participate in the management of Congestion and the valuation of Inter-ZonalZonal Interfaces. This information may include the ISO's most-current information regarding: potentially Congested paths, projected transmission uses, projected hourly Loop Flows across Inter- Zonal Interfaces, scheduled line Outages, forecasts of expected system-wide Load, the ISO's Ancillary Services requirements, Generation Meter Multipliers, and power flow outputs. 7.2.5.2.9 The ISO will also publish information, once it is available, regarding tentative prices for the use of Inter-Zonal Interfaces, and Generation shift factors for the use of Inter-Zonal Interfaces, which indicate the relative effectiveness of Generation shifts in alleviating Congestion.

Inter-Zonal Congestion Management. 7.2.5.1 The scheduling procedures in the Day-Ahead Market and Hour-Ahead Market will first ascertain, through power flow calculations, whether or not Inter- 7.2.5.2 The purpose of Inter-Zonal Congestion Management is to allocate the use of, and determine the marginal value of, active Inter-Zonal Interfaces. Inter-Zonal Congestion Management will comply with the requirements stated in Sections 7.2.2, 7.2.4 and 7.2.5. 7.2.5.2.1 Inter-Zonal Congestion Management will keep each Scheduling Coordinator's portfolio of Generation and Demand (i.e., the Scheduling Coordinator's Preferred Schedule) separate from the portfolios of the other Scheduling Coordinators, as the ISO adjusts the Schedules to alleviate Inter-Zonal Congestion. 7.2.5.2.2 If Congestion would exist on one or more active Inter-Zonal Interfaces, then the ISO shall execute its Inter-Zonal Congestion Management algorithms to determine a set of tentative (in the Day-Ahead procedure) allocations of Inter-Zonal Interface rights and tentative (in the Day-Ahead procedure) Usage Charges, where the Usage Charges will be calculated as the marginal values of the Congested Inter-Zonal Interfaces. The marginal value of a Congested Inter-Zonal Interface is calculated by the ISO’s computer optimization algorithm to equal the total change in redispatch costs (based on the Adjustment Bids) that would result if the interface’s scheduling limit was increased by a small increment. 7.2.5.2.3 As part of the Day-Ahead scheduling procedure, but not the Hour-Ahead scheduling procedure, Scheduling Coordinators will be given the opportunity to adjust their Preferred Schedules (including the opportunity to make trades amongst one another) and to submit Revised Schedules to the ISO, in response to the ISO's Suggested Adjusted Schedules and prices for Inter-Zonal Interfaces. 7.2.5.2.4 If the ISO receives any Revised Schedules it will execute its Inter-Zonal Congestion Management algorithms using revised Preferred Schedules, to produce a new set of allocations and prices. 7.2.5.2.5 All of the ISO's calculations will treat each Settlement Period independently of the other Settlement Periods in the Trading Day. 7.2.5.2.6 [Not Used] 7.2.5.2.7 If inadequate Adjustment Bids have been submitted to schedule Inter- Inter-Zonal Interface capacity on an economic basis and to the extent that scheduling decisions cannot be made on the basis of economic value, the ISO will allocate the available Inter-Zonal Interface capacity to Scheduling Coordinators in proportion to their respective proposed use of that capacity as indicated in their Schedules and shall curtail scheduled Generation and Demand to the extent necessary to ensure that each Scheduling Coordinator’s Schedule remains balanced. 7.2.5.2.8 The ISO will publish information prior to the Day-Ahead Market, between the iterations of the Day-Ahead Market, and prior to the Hour-Ahead Market, to assist the Scheduling Coordinators to construct their Adjustment Bids so as to actively participate in the management of Congestion and the valuation of Inter-Zonal

Inter-Zonal Congestion Management. 7.2.5.1 The scheduling procedures in the Day-Ahead Market and Hour-Ahead Market will first ascertain, through power flow calculations, whether or not Inter- 7.2.5.2 The purpose of Inter-Zonal Congestion Management is to allocate the use of, and determine the marginal value of, active Inter-Zonal Interfaces. Inter-Zonal Congestion Management will comply with the requirements stated in Sections 7.2.2, 7.2.4 and 7.2.5. 7.2.5.2.1 Inter-Zonal Congestion Management will keep each Scheduling Coordinator's ’s portfolio of Generation and Demand (i.e., the Scheduling Coordinator's ’s Preferred Schedule) separate from the portfolios of the other Scheduling Coordinators, as the ISO adjusts the Schedules to alleviate Inter-Zonal Congestion. 7.2.5.2.2 If Congestion would exist on one or more active Inter-Zonal Interfaces, then the ISO shall execute its Inter-Zonal Congestion Management algorithms to determine a set of tentative (in the Day-Ahead procedure) allocations of Inter-Zonal Interface rights and tentative (in the Day-Ahead procedure) Usage Charges, where the Usage Charges will be calculated as the marginal values of the Congested Inter-Zonal Interfaces. The marginal value of a Congested Inter-Zonal Interface is calculated by the ISO’s computer optimization algorithm to equal the total change in redispatch costs (based on the Adjustment Bids) that would result if the interface’s scheduling limit was increased by a small increment. 7.2.5.2.3 As part of the Day-Ahead scheduling procedure, but not the Hour-Ahead scheduling procedure, Scheduling Coordinators will be given the opportunity to adjust their Preferred Schedules (including the opportunity to make trades amongst one another) and to submit Revised Schedules to the ISO, in response to the ISO's ’s Suggested Adjusted Schedules and prices for Inter-Zonal Interfaces. 7.2.5.2.4 If the ISO receives any Revised Schedules it will execute its Inter-Zonal Congestion Management algorithms using revised Preferred Schedules, to produce a new set of allocations and prices. 7.2.5.2.5 All of the ISO's ’s calculations will treat each Settlement Period independently of the other Settlement Periods in the Trading Day. 7.2.5.2.6 [Not Used] 7.2.5.2.7 If inadequate Adjustment Bids have been submitted to schedule Inter- Inter-Zonal Interface capacity on an economic basis and to the extent that scheduling decisions cannot be made on the basis of economic value, the ISO will allocate the available Inter-Inter- Zonal Interface capacity to Scheduling Coordinators in proportion to their respective proposed use of that capacity as indicated in their Schedules and shall curtail scheduled Generation and Demand to the extent necessary to ensure that each Scheduling Coordinator’s Schedule remains balanced. 7.2.5.2.8 The ISO will publish information prior to the Day-Ahead Market, between the iterations of the Day-Ahead Market, and prior to the Hour-Ahead Market, to assist the Scheduling Coordinators to construct their Adjustment Bids so as to actively participate in the management of Congestion and the valuation of Inter-Zonal 7.2.5.2.9 The ISO will also publish information, once it is available, regarding tentative prices for the use of Inter-Zonal Interfaces, and Generation shift factors for the use of Inter-Zonal Interfaces, which indicate the relative effectiveness of Generation shifts in alleviating Congestion.

Inter-Zonal Congestion Management. 7.2.5.1 7. 2.5 .1 The scheduling procedures in the Day-Ahead Market and Hour-Ahead Market will first ascertain, through power flow calculations, whether or not Inter-Inter- Zonal Congestion would exist if all of the Preferred and Revised Schedules submitted by the Scheduling Coordinators , including any tr ansmission associated with Ancillary Services bid were accepted by the ISO. If no Inter-Zonal Congestion would exist, then all Inter-Zonal Interface uses will be accepted , and the Usage Charges will be zero and the ISO will then utilize its Intra-Zonal Congestion Management . 7.2.5.2 7. 2.5 .2 The purpose of Inter-Zonal Congestion Management is to allocate the use of, and determine the marginal value of, active Inter-Zonal Interfaces. Inter-Zonal Congestion Management will comply with the requirements stated in Sections 7.2.2, 7.2.4 and 7.2.5. 7.2.5.2.1 7. 2.5 .2 .1 Inter-Zonal Congestion Management will keep each Scheduling Coordinator's portfolio of Generation and Demand Load (i.e., the Scheduling Coordinator's Preferred Schedule) separate from the portfolios of the other Scheduling Coordinators, as the ISO adjusts the Schedules to alleviate Inter-Zonal Congestion. 7.2.5.2.2 7. 2.5 .2 .2 If Congestion would exist on one or more active Inter-Zonal Interfaces, then the ISO shall execute its Inter-Zonal Congestion Management algorithms to determine a set of tentative (in the Day-Ahead procedure) allocations of Inter-Zonal Interface rights and tentative (in the Day-Ahead procedure) Usage Charges, where the Usage Charges will be calculated as the marginal values of the Congested Inter-Zonal InterfacesZonal 7. The marginal value of a Congested Inter-Zonal Interface is calculated by the ISO’s computer optimization algorithm to equal the total change in redispatch costs (based on the Adjustment Bids) that would result if the interface’s scheduling limit was increased by a small increment. 7.2.5.2.3 2.5 .2 .3 As part of the Day-Ahead scheduling procedure, but not the Hour-Hour- Ahead scheduling procedure, Scheduling Coordinators will be given the opportunity to adjust their Preferred Schedules (including the opportunity to make trades amongst one another) and to submit Revised Schedules to the ISO, in response to the ISO's Suggested Adjusted Schedules and prices for Inter-Zonal Interfaces. 7.2.5.2.4 7. 2.5 .2 .4 If the ISO receives any Revised Schedules it will execute its Inter-Zonal Congestion Management algorithms using revised Preferred Schedules, to produce a new set of allocations and prices. At the conclusion of these calculations, the ISO shall select either (i) the first set of tentative allocations and prices or (ii) the second set of allocations and prices. The ISO will make its selection based on which of the two sets of allocations results in the lower total amount of Usage Charge revenues to the ISO for the hour. 7.2.5.2.5 7. 2.5 .2 .5 All of the ISO's calculations will treat each Settlement Period independently of the other Settlement Periods in the Trading Day. 7.2.5.2.6 [Not Used] 7.2.5.2.7 If inadequate Adjustment Bids have been submitted to schedule Inter- Zonal Interface capacity on an economic basis and to the extent that scheduling decisions cannot be made on the basis of economic value, the ISO will allocate the available Inter-Zonal Interface capacity to Scheduling Coordinators in proportion to their respective proposed use of that capacity as indicated in their Schedules and shall curtail scheduled Generation and Demand to the extent necessary to ensure that each Scheduling Coordinator’s Schedule remains balanced. 7.2.5.2.8 The ISO will publish information prior to the Day-Ahead Market, between the iterations of the Day-Ahead Market, and prior to the Hour-Ahead Market, to assist the Scheduling Coordinators to construct their Adjustment Bids so as to actively participate in the management of Congestion and the valuation of Inter-Zonal

Inter-Zonal Congestion Management. 7.2.5.1 The scheduling procedures in the Day-Ahead Market and Hour-Ahead Market will first ascertain, through power flow calculations, whether or not Inter- 7.2.5.2 The purpose of Inter-Zonal Congestion Management is to allocate the use of, and determine the marginal value of, active Inter-Zonal Interfaces. Inter-Zonal Congestion Management will comply with the requirements stated in Sections 7.2.2, 7.2.4 and 7.2.5. 7.2.5.2.1 Inter-Zonal Congestion Management will keep each Scheduling Coordinator's portfolio of Generation and Demand (i.e., the Scheduling Coordinator's Preferred Schedule) separate from the portfolios of the other Scheduling Coordinators, as the ISO adjusts the Schedules to alleviate Inter-Zonal Congestion. 7.2.5.2.2 If Congestion would exist on one or more active Inter-Zonal Interfaces, then the ISO shall execute its Inter-Zonal Congestion Management algorithms to determine a set of tentative (in the Day-Ahead procedure) allocations of Inter-Zonal Interface rights and tentative (in the Day-Ahead procedure) Usage Charges, where the Usage Charges will be calculated as the marginal values of the Congested Inter-Zonal Interfaces. The marginal value of a Congested Inter-Zonal Interface is calculated by the ISO’s 's computer optimization algorithm to equal the total change in redispatch costs (based on the Adjustment Bids) that would result if the interface’s 's scheduling limit was increased by a small increment. 7.2.5.2.3 As part of the Day-Ahead scheduling procedure, but not the Hour-Ahead scheduling procedure, Scheduling Coordinators will be given the opportunity to adjust their Preferred Schedules (including the opportunity to make trades amongst one another) and to submit Revised Schedules to the ISO, in response to the ISO's Suggested Adjusted Schedules and prices for Inter-Zonal Interfaces. 7.2.5.2.4 If the ISO receives any Revised Schedules it will execute its Inter-Zonal Congestion Management algorithms using revised Preferred Schedules, to produce a new set of allocations and prices. 7.2.5.2.5 All of the ISO's calculations will treat each Settlement Period independently of the other Settlement Periods in the Trading Day. 7.2.5.2.6 [Not Used] 7.2.5.2.7 If inadequate Adjustment Bids have been submitted to schedule Inter- Inter-Zonal Interface capacity on an economic basis and to the extent that scheduling decisions cannot be made on the basis of economic value, the ISO will allocate the available Inter-Zonal Interface capacity to Scheduling Coordinators in proportion to their respective proposed use of that capacity as indicated in their Schedules and shall curtail scheduled Generation and Demand to the extent necessary to ensure that each Scheduling Coordinator’s 's Schedule remains balanced. 7.2.5.2.8 The ISO will publish information prior to the Day-Ahead Market, between the iterations of the Day-Ahead Market, and prior to the Hour-Ahead Market, to assist the Scheduling Coordinators to construct their Adjustment Bids so as to actively participate in the management of Congestion and the valuation of Inter-Zonal 7.2.5.2.8 The ISO will also publish information, once it is available, regarding tentative prices for the use of Inter-Zonal Interfaces, and Generation shift factors for the use of Inter- Zonal Interfaces, which indicate the relative effectiveness of Generation shifts in alleviating Congestion.

Inter-Zonal Congestion Management. 7.2.5.1 The scheduling procedures in the Day-Ahead Market and Hour-Ahead Market will first ascertain, through power flow calculations, whether or not Inter-Inter-Zonal Congestion would exist if all of the Preferred and Revised Schedules submitted by the Scheduling Coordinators were accepted by the ISO. If no Inter-Zonal Congestion would exist, then all Inter-Zonal Interface uses will be accepted and the Usage Charges will be zero. 7.2.5.2 The purpose of Inter-Zonal Congestion Management is to allocate the use of, and determine the marginal value of, active Inter-Zonal Interfaces. Inter-Zonal Congestion Management will comply with the requirements stated in Sections 7.2.2, 7.2.4 and 7.2.5., 7.2.5.2.1 Inter-Zonal Congestion Management will keep each Scheduling Coordinator's portfolio of Generation and Demand Load (i.e., the Scheduling Coordinator's Preferred Schedule) separate from the portfolios of the other Scheduling Coordinators, as the ISO adjusts the Schedules to alleviate Inter-Zonal Congestion. 7.2.5.2.2 If Congestion would exist on one or more active Inter-Zonal Interfaces, then the ISO shall execute its Inter-Zonal Congestion Management algorithms to determine a set of tentative (in the Day-Ahead procedure) allocations of Inter-Zonal Interface rights and tentative (in the Day-Ahead procedure) Usage Charges, where the Usage Charges will be calculated as the marginal values of the Congested Inter-Zonal Interfaces. The marginal value of a Congested Inter-Zonal Interface is calculated by the ISO’s computer optimization algorithm to equal the total change in redispatch costs (based on the Adjustment Bids) that would result if the interface’s scheduling limit was increased by a small increment.was 7.2.5.2.3 As part of the Day-Ahead scheduling procedure, but not the Hour-Ahead scheduling procedure, Scheduling Coordinators will be given the opportunity to adjust their Preferred Schedules (including the opportunity to make trades amongst one another) and to submit Revised Schedules to the ISO, in response to the ISO's Suggested Adjusted Schedules and prices for Inter-Zonal Interfaces. 7.2.5.2.4 If the ISO receives any Revised Schedules it will execute its Inter-Zonal Congestion Management algorithms using revised Preferred Schedules, to produce a new set of allocations and prices. 7.2.5.2.5 All of the ISO's calculations will treat each Settlement Period independently of the other Settlement Periods in the Trading Day. 7.2.5.2.6 [Not Used] 7.2.5.2.7 If inadequate Adjustment Bids have been submitted to schedule Inter- Inter-Zonal Interface capacity on an economic basis and to the extent that scheduling decisions cannot be made on the basis of economic value, the ISO will allocate the available Inter-Zonal Interface capacity to Scheduling Coordinators in proportion to their respective proposed use of that capacity as indicated in their Schedules and shall curtail scheduled Generation and Demand to the extent necessary to ensure that each Scheduling Coordinator’s Schedule remains balanced. 7.2.5.2.8 The ISO will publish information prior to the Day-Ahead Market, between the iterations of the Day-Ahead Market, and prior to the Hour-Ahead Market, to assist the Scheduling Coordinators to construct their Adjustment Bids so as to actively participate in the management of Congestion and the valuation of Inter-ZonalZonal Interfaces. This information may include the ISO's most-current information regarding: potentially 7.2.5.2.9 The ISO will also publish information, once it is available, regarding tentative prices for the use of Inter-Zonal Interfaces, and Generation shift factors for the use of Inter-Zonal Interfaces, which indicate the relative effectiveness of Generation shifts in alleviating Congestion.