2. MOSC Meeting Operations Market Manual updates October 22, 2003 Presented by:Ron Falsetti Steve Cooper

3. Changes MM 4.3 - Real-Time Scheduling of Ph. Mkts. –IMO - NYISO Scheduling Protocol (IMDC 0051) –Dispatch instruction enhanced filtering (IMDC 0053) MM 7.1, 7.4 Policies, Procedures & 7.8 OPSRP - C hanges arising from : –August 14 th blackout + other contingencies; –Power system restoration exercises; –Operating reserve pricing initiative;and –Voltage reduction test results.

4. IMO - NYISO Scheduling Protocol

5. 11:0012:0014:0015:00 NYISO posts Day-Ahead interchange schedules IMO determines and posts first pre-dispatch schedule 15:30 NYISO passes Day-Ahead commitments (with pre-schedules identified) to the IMO IMO pre-dispatch schedule incorporating NYISO Day Ahead commitments posted IMO Pre-Dispatch / NYISO Day Ahead Period IMO-NYISO Scheduling Protocol

6. IMO Hourly Pre-Dispatch / NYISO Balancing Market Evaluation Period T-120 T-60 T=0 Dispatch HourT-100 T-75 T-30 T-40 NYISO runs BME and posts BME results NYISO filters BME bids using information on interchange schedules accepted by the IMO 2-hour ahead pre-dispatch IMO and NYISO confirm final interchange schedules NYISO hour ahead market closes IMO determines projected interchange schedules for the dispatch hour based on 2-hour ahead pre-dispatch run and passes them to NYISO

7. Dispatch Instruction Filtering

8. Existing Dispatch Filtering Filter prevents sending out dispatch instructions for small changes in scheduled quantities New dispatch instructions issued for provision of energy change from the previous dispatch instruction provided greater than the lesser of 2% of maximum offer/bid capability and 10 MW

9. Filtering Enhancements More adaptive filtering capability to help maintain adequacy and minimize CMSC that: –disables filtering of dispatch instruction within filter thresholds for: energy resource dispatches to the facilities HIGH or LOW operating limit; and energy reduction changes when previous dispatch instruction is > max. offer

10. Filtering Enhancements cont’d –disables filtering every 30 minutes & prior to dispatch hour (intervals 1, 7 and 12) –permits filter thresholds to be energy resource configurable

11. Operating Policies and Procedures

12. Policies & Procedures Enhance operational communication protocols & communication content involving the IMO, transmitters & connected market participants Potential changes to controlled rotational & U/F load shedding Clarify procedures for emergency reduction of major generating facility output to mitigate OSL after a contingency.

13. OPSRP Emergency Preparedness Task Force annual review of OPSRP - after the Nov. 26, 2003 exercise Lessons learned from the Aug. 14 blackout –EPTF sponsored Restoration Working Group feedback - end of Nov.

14. OPSRP Cont’d Reinforce need for key facility and critical component testing Reinforce need for restoration plan market participants to open circuit breakers

15. Control Action Breakers

16. By removing from service certain circuit breakers & eliminating the breaker failure contingency there are opportunities to improve transfer capabilities This is required for TLR (TLR 4), but can also help to relieve interface congestion, enhance our ability to mitigate adequacy concerns, and provide additional transaction opportunities Should this policy change be adopted it would require changes to market manual 7.4 and Appendix E “EOSCA list”