 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          5746
 
                               2017-2018 Regular Sessions
 
                   IN ASSEMBLY
 
                                    February 15, 2017
                                       ___________
 
        Introduced by M. of A. DINOWITZ -- 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:

     1    Section  1.  Section 66 of the public service law is amended by adding
     2  three new subdivisions 29, 30 and 31 to read as follows:
     3    29. Review the rates  of  any  public  utility  on  an  annual  basis,
     4  provided  however  that  upon a determination by the commission that the
     5  public interest does not require such annual rate review,  a  review  of
     6  rates may be undertaken at no more than three year intervals.
     7    30.  (a) Use the fullest extent of its powers to regulate the distrib-
     8  ution of retail electric energy to retail customers in the state and, to
     9  the extent not prohibited by federal law, the transmission  of  electric
    10  energy in the state.
    11    (b)  A market clearing price mechanism for the purchase of power shall
    12  be forbidden for purchases made through the wholesale market via  a  bid
    13  procurement  or  auction process held by the independent system operator
    14  ("ISO") of New York, or any successor in law and function to such  enti-
    15  ty.
    16    (c)  Such  auction or bid procurement process shall be overseen by the
    17  commission, which shall require a descending clock,  pay-as-bid  auction
    18  in which bid amounts will continue to fall until no bidder is willing to
    19  supply  electricity  at  a lower price. For the purposes of this article
    20  "descending clock auction" shall be defined as an auction in  which  the
    21  prices  drop  throughout  an  auction of time-limited duration; starting
    22  high and being reduced gradually until the supply bid is just sufficient
    23  to meet the electrical load to be procured. Prices that tick down  in  a
    24  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.
                                                                   LBD07504-01-7

        A. 5746                             2
 
     1  ous  price.  Bidders  holding the final bids when the auction closes are
     2  the winners.
     3    (d)  Bidders  will  be forbidden from knowing when the amount of elec-
     4  tricity supply fills requirements.
     5    (e) The commission shall appoint  an  independent  market  advisor  to
     6  review  market  practices  and  behavior; that will recommend to the ISO
     7  actions that can be taken to mitigate  or  correct  behavior  by  market
     8  participants  that  was  reasonably  calculated to, or had the effect of
     9  affecting the function of the auction process so that the winning bidder
    10  was not the lowest price bidder.
    11    (f) Utilities may buy power from markets other than the  ISO,  or  via
    12  contracts  with  individuals  or groups of generating entities, provided
    13  that such electrical energy must be offered to  customers  at  just  and
    14  reasonable rates.
    15    31.  (a)  The commission shall exercise its full jurisdiction over the
    16  ISO of New York.
    17    (b) The commission shall regulate the reliability, quality and mainte-
    18  nance by transmitters and distributors of their transmission and  retail
    19  distribution systems.
    20    (c)  The  commission  shall regulate the reliability, quality, mainte-
    21  nance, and price of generators.
    22    (d) The commission shall not require any incumbent electric utility to
    23  divest itself of any generation,  transmission  or  distribution  assets
    24  pursuant  to  any provision of this chapter without specific authorizing
    25  legislation for such purpose.
    26    (e) The commission  shall  develop  codes  of  conduct  governing  the
    27  conduct  of incumbent electric utilities and affiliates thereof when any
    28  such affiliates provide, or control any  entity  that  provides,  gener-
    29  ation, distribution, or transmission services to the extent necessary to
    30  prevent impairment of competition. Nothing in this chapter shall prevent
    31  an  incumbent  electric  utility  from  offering metering options to its
    32  customers.
    33    § 2. This act shall take effect immediately.
Abolishes the market clearing price

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