nerc standards and compliance 101€¦ · •twelve membership categories: investor-owned utility...

NERC Standards and Compliance 101Mallory Huggins, NERC Standards DeveloperAdina Mineo, NERC Senior Compliance Operations Auditor Standards and Compliance Spring WorkshopApril 1, 2014

RELIABILITY | ACCOUNTABILITY2

• NERC Overview• Standards 101• Standards Website Tutorial• Standards Q&A• Compliance Operations 101• Compliance Website Tutorial• Compliance Operations Q&A

Presentation Agenda


• Mission: Ensure the reliability of the North American Bulk-Power System (BPS) by: Holding entities accountable for compliance with mandatory NERC

Reliability Standards Acting as a catalyst for positive change within the industry

NERC’s Role


• NERC defines a reliable BPS as one that is able to meet the electricity needs of end-use customers even when unexpected equipment failures reduce the amount of available electricity

• This means: Adequacy – sufficient resources Security – ability of system to withstand sudden and expected

disturbances

Defining Reliability


Reliability History: Key Dates

1965: Northeast blackout1968: National Electric Reliability Council (NERC) established by

the electric industry2002: NERC operating policy and planning standards become

mandatory and enforceable in Ontario, Canada2003: August 14 blackout; worst to date2005: U.S. Energy Policy Act of 2005 creates the Electric Reliability Organization

(ERO)2006: Federal Energy Regulatory Commission (FERC) certifies NERC as the ERO;

Memorandum of Understanding (MOUs) with some Canadian Provinces2007: North American Electric Reliability Council becomes the North

American Electric Reliability Corporation (still NERC); FERC issues Order 693 approving 83 of 107 proposed reliability standards; reliability standards become mandatory and enforceable


• Only one ERO; overseen by U.S. and Canadian regulatory authorities (FERC and the Provinces) Responsible for developing/enforcing standards Independent of owners, operators, users Adheres to rules governing standards development, compliance

enforcement, budgeting

NERC as ERO


• Develops and enforces standards• Monitors the BPS• Assesses adequacy• Audits owners, operators, and users for preparedness• Educates and trains industry personnel

What does NERC do?


NERC’s Board of Trustees

F. Gorbet J. CaseG. Cauley R. Clarke D. GouldingP. Barber

D. Jaeger R. ThillyJ. SchoriB. ScherrK.Peterson


• Open to all entities interested in the BPS• Twelve membership categories: Investor-owned utility State or municipal utility Cooperative utility Federal or provincial utility/power marketing administrator Transmission dependent utility Merchant electricity generator Electricity marketer Large end-use electricity customer Small end-use electricity customer Independent system operator/regional transmission organization Regional Entity Government representative

NERC Membership


Relationship of NERC Members to Board of Trustees


NERC Regions

FRCC Florida Reliability Coordinating Council MRO Midwest Reliability Organization NPCC Northeast Power Coordinating Council RF ReliabilityFirst SERC SERC Reliability Corporation SPP-RE Southwest Power Pool Regional Entity TRE Texas Reliability Entity WECC Western Electric Coordinating Council


• Perform delegated functions: Regional standards Compliance Organization registration Reliability assessments

• Regional consistency key for transparency, predictability, and uniform outcomes

Responsibilities of the Regions


• NERC and Regional Entities allocate operating costs to load-serving entities (LSEs): LSEs are owners, operators, and users of the BPS, responsible for

delivering electricity to retail customers.

NERC Funding


• Bulk-Power System Awareness• Communications• Compliance Enforcement• Compliance Investigations • Compliance Operations• Critical Infrastructure• Event Analysis• Finance and Accounting

NERC Departments


NERC Departments

• Human Performance and Training• Human Resources• Information Technology• Legal and Regulatory• Policy and External Affairs• Reliability Assessment and Performance Analysis (RAPA)• Reliability Initiatives and System Analysis (RISA)• Standards


• Standards development process depends on active participation of stakeholders

• Stakeholder technical expertise is essential to standard development process

• Order 672: Commission must give “due weight to technical expertise of ERO”

Stakeholder Accountability


• Governed by Standard Processes Manual (SPM) approved in June 2013

NERC’s Standard Process


Roles and Responsibilities

StandardsCommittee

StakeholdersDrafting Teams

BallotPools

Board of Trustees

TORTO

LSE

TDU

Gov’t

Gen.Mkt.

RE

LEU

SEURegulators

StandardsStaff

BallotBody


• Prioritizes standards development activities• Reviews actions to ensure the standards development process

is followed• Reviews and authorizes Standard Authorization Requests

(SARs)• Manages progress of SARs and standards development efforts• Reviews and authorizes drafting new or revised standards and

their supporting documents• Makes appointments to standard drafting teams (SDTs)

Standards Committee


• Process Subcommittee (SCPS) Develops, reviews, and maintains processes and procedures that support

standards development

• Project Management and Oversight Subcommittee (PMOS) Works with NERC staff and SDTs to manage the timely development and

maintenance of a comprehensive set of world-class standards

Standards Committee Subcommittees


DraftStandard

Collect InformalFeedback

Post for Final Ballot

Board AdoptsImplement

Appoint SDT

Authorize Posting SAR

Regulatory AgenciesApprove

Consider,Respond,

Revise

Post for Comment &

Ballot

Consider,Respond,

Revise

NERC Standards Development Process


• Required by American National Standards Institute (ANSI) to document the scope and reliability benefit of a proposed project

• Must be accompanied by technical justification

SARs


• Develop an excellent, technically correct standard that helps provide an adequate level of reliability and achieves consensus Stay within the scope of the SAR Address regulatory directives and stakeholder issues Consider Independent Experts’ Review Panel input Ensure standard meets criteria for approval

• Develop initial set of Violation Risk Factors (VRFs) and Violation Severity Levels (VSLs) and associated reasoning

• Produce a realistic Implementation Plan• Develop supporting documents (optional)

Roles and Responsibilities of Drafting Teams


• If a team is formed to address the SAR, the same team develops the standard

• Includes: Stakeholder facilitator NERC staff project manager Subject Matter Experts (SMEs) Technical writer (if needed) Legal support FERC staff observers Industry observers

Drafting Team Formation and Support


Stakeholder Consensus Process

Informal Feedback

Consider/Respond to Feedback

Post Standard forComment/Ballot

Consider/Respond to Comments

Final Ballot

Initial/Additional Ballot:At this step, the standard is either“new” or significantly changed fromthe last version posted for comment/ballot. The ballot record starts withno votes and no comments.

Final Ballot:At this step, there have been nosignificant changes to the standardfrom the last ballot. The ballot record starts with all votes and comments from the previous ballot.



Informal Feedback




Final Ballot




• Stakeholder feedback is essential Comments (or indication of support of another entity’s comments) must

be submitted for each negative vote in order for that vote to be counted towards consensus

• The best comments offer suggested replacement language first and then support that suggested language with rationale

• If a stakeholder cannot suggest alternate language, he or she should still support his or her claim with sound technical rationale

• New balloting and commenting software will give stakeholders far more options with respect to commenting

Building Consensus with Comments


• “In Attachments 1, 2, and 3 the six-month requirement for notice is too short in many cases. We suggest nine months to one year. Six months is not enough time for budgeting and construction scheduling.”

• “The Generator Owner (GO) appears to be the logical choice. The GO has the access to the equipment records, Generator Operator (GOP) may not.”

Sample Comments


• “Disagree with R2 as written.”• “Disagree with assigning requirement to the GO.”• “Definition is a little loose.”

Sample Comments


Drafting Team Responses to Comments


• Sections of Comment Report Executive Overview

o What was posted wheno Who commentedo What was changed and whyo Unresolved minority issueso Link to unformatted commentso Reminder of appeals process

Index to questions List of commenters Questions and responses

Navigating a Comment Report


• If time is limited: Read the first section For each question, read the summary response Find responses to your comments

• If time is not limited: Read the entire report

Navigating a Comment Report



Informal Feedback




Final Ballot




• Balloter Accountability Review changes made to the standard Review unresolved minority issues Last chance to see if you should change your vote

Final Ballot


FERC’s Approval Process for Standards

Standard and TechDetails

NOPR OrderFERC

AnalysisFERC

Analysis


• Seek additional clarity about one or more requirements in approved standards

• An entity or individual may submit a Request for Interpretation using the form on NERC’s website

• The interpretation development process is similar to the standard development process

• Response provides clarity on the requirement(s) but does not expand on the requirement(s) or explain how to comply

Interpretations


• 2014–2016 Reliability Standards Development Plan (RSDP) Continues bold plan for standards development High-level RSDP supported Family Snapshot document and RSDP Work

Plan Informed by Independent Experts Review Project, periodic reviews, current

workload, outstanding directives

• Standards Development Tools Weekly Standards Bulletin Project Tracking Spreadsheet Projected Posting Schedule New balloting and commenting software – now live!

Current State of Standards


• Subscribe to mailing lists General standards mailing list (includes Weekly Standards Bulletin) Project-specific mailing lists

• Review Project Tracking Spreadsheet and Projected Posting Schedule regularly

• Respond to requests for comments on draft standards; review comments from others

• Participate in webinars and workshops• Participate in Registered Ballot Body and join ballot pools• Vote on standards• Volunteer for drafting teams• Volunteer for the SC

Getting Involved


• Help joining NERC Registered Ballot Body or participating in comment periods: Wendy Muller at [email protected]

• To be added to (one or more of) NERC’s email lists: [email protected]

• Suggestions for website improvements: Barbara Nutter at [email protected]

• Suggestions for improved communication: Mallory Huggins at [email protected]

• If you ever feel there was an error or omission during the consideration of comments process: Mark Lauby at [email protected].

Standards Staff Contacts

mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]


Locating Standards on NERC’s Home Page

• Select Program Areas & Departments Select Standards under the drop-down menu


Locating Reliability Standards

• Select Reliability Standards on the left navigation Select the United States jurisdiction


Locating Reliability Standards & Status

• Select the appropriate status in the middle of the page Note: This page defaults to the Mandatory Standards Subject to

Enforcement status


Locating a Reliability Standard(s)

• Select the symbol of the desired standards family i.e., (COM) Communications


• Select the hyperlinked title of the desired standard

Viewing the Standard


• Scroll to the bottom of the Standard to see theenforcement/inactive date data

Standards Addendum


Viewing the Project Page/Associated Docs for the Standard

• Select the Related Information link associated with the desired standard


Understanding the Related Information Page

• Related Links: Development History (project page, compliance tools & related links)

• Related Documents: Implementation Plans and associated documents (.pdf)


Standards Left Navigation


• Select US Enforcements Dates from the left navigation Note: This page defaults to the Mandatory Standards Subject to

Enforcement status

US Enforcements Dates Page


US Enforcements Dates Page (Cont’d)

• Select the status to see the dates pertinent to the standard Note: Clicking the enforcement date will enable viewing of the FERC Order for

that standard


For More Information


Standards Under Development


Standards News/Bulletins


Standards Tracking Tools


Projected Posting Schedule is posted each Monday.

Projected Posting Schedule


Project Tracking Spreadsheet is updated monthly.

Project Tracking Spreadsheet


Standards Committee and Subcommittee Access


Standards Committee (SC)

One-Stop Committee Resource Page


Objective

Provide an overview of the structure and Compliance Monitoring processes, as well as provide available resources pertaining to the monitoring of Registered Entities’ compliance with NERC standards.


• ERO compliance organization• Foundational compliance operations documents• Annual compliance operations documents• Compliance process overview• Compliance resources• Reliability Assurance Initiative (RAI)

Agenda


ERO Compliance Organization

FERC

NERCRegional

Oversight-Compliance

Compliance Analysis &

Certification

ComplianceEnforcement

8 Regional Entities


• Energy Policy Act of 2005 – Section 215• Rules of Procedure (ROP) – Section 400 Provides for NERC oversight of Regional Entities (REs) Compliance program attributes (audit cycles, independence,

confidentiality) ROP Appendix 4C, Compliance Monitoring and Enforcement Program

• Regional Delegation Agreements Delegation to REs to enforce Reliability Standards REs must follow ROP

Foundational Guiding Documents


• Compliance Monitoring and Enforcement Program (CMEP) Outlines Compliance Monitoring processes Provides guidance and requirements for each monitoring process

• CMEP also describes: Enforcement actions Mitigations of violations Remedial action directives Data retention and confidentiality

Foundational Guiding Documents


• Annual ERO CMEP Implementation Plan (NERC and REs) Direction CMEP will take for the year Major compliance initiatives for the year ERO reliability assessment Presentation of Actively Monitored List (AML) and rationale

• AML Identifies high-risk priority standards Determined based on FERC guidance, compliance history, events analysis,

and stakeholder input All standards are subject to audit based on professional judgment of RE

audit teams

Annual Guiding Documents


• Compliance Monitoring and Enforcement Program (CMEP) Compliance Monitoring Processeso Compliance Auditso Self-Certificationso Spot Checkso Compliance Investigations o Self-Reportso Periodic Data Submittalso Complaints o Exception Reports

CMEP-Compliance Activities


• Entity’s registration determines audit cycle ROP states: Audit will occur at least once every 3 years for Balancing

Authority, Reliability Coordinator, or Transmission Operator Audits of other entities may occur on 6 year cycle. Refer to annual ERO

CMEP IP Audit schedules posted in ERO CMEP IP on NERC website

• REs lead compliance audits, NERC and FERC may observe Audit team composition and requirements described in Section 3.1.5 of

CMEP

• Audits are based on GAAS/GAGAS/IIA

Compliance Audits


Compliance Audit Cycle

Audit Cycle

Fieldwork

Audit Cycle


• Pre-audit: RE planning stage. Assembles team, logistics, etc.• Planning: RE detailed planning for audit scoping, understanding

entity, developing data requests• Fieldwork: Actual audit starts, testing begins • Reporting: RE develops reports with Finding(s),

Recommendation(s), Area(s) of Concern, etc.• Performance Assessment: RE reviews workpapers, identifies

lessons learned, etc.

Compliance Audit Cycle


• Audit scope determined based on entity registration, AML, reliability assessment, and ERO CMEP IP (NERC and RE) Scope identified in Audit Notification Letter Audit period identified in Audit Notification Letter

• Audit team collects and reviews evidence for all standards/requirements in audit scope and uses professional judgment to determine entity’s compliance

• Audit team will conduct onsite or offsite audits Onsite: Audit occurs at Registered Entity Offsite: Audit occurs at RE office

• Audit team assesses compliance. Audit team identifies possible violations, areas of concern, and recommendations.

• A public and non-public audit report is issued

Compliance Process


• Annually, Registered Entities must self-certify compliance with every applicable actively monitored standard/requirement for each of its function(s) Includes NERC AML RE actively monitored requirements identified by the RE

• Registered Entities must identify non-compliance where necessary

Self-Certifications


• RE may conduct a spot check at any time to determine compliance with any Reliability Standard/requirement Typically smaller in scope than an audit Normally may result after an event, compliance, system disturbance, or to

ensure mitigation of previous findings REs may use periodically in lieu of a compliance audit

Spot Checks


• Registered Entities should make a self-report once it becomes aware it: Has, or may have, violated a standard or requirement The Violation Severity Level of a previously reported violation has changed

• REs have specific self-reporting processes entities must follow REs will make available self-report forms Entity should provide relevant documentation to support filing REs will review information to evaluate compliance and needed mitigation

• Exception reporting is required within certain standards. Similar process as self-report.

Self-Reports and Exception Reporting


• Registered Entities or other third party may make a complaint to NERC or an RE

• Complaints may be sent through compliance hotlines, emails, or other contact methods

• Complaints may trigger a spot check• Any findings resulting from a complaint are processed similarly

to an audit finding or spot check finding

Complaints


• REs identify and notify entities of data submittal requirements• REs collect submittals and review for compliance

Periodic Data Submittals


• Investigation to confirm occurrence of non-compliance• Broader scope than spot check, more detailed investigation• Generally led by RE staff, may have NERC participation• Confidential, unless FERC directive

Compliance Investigations


Reliability Assurance Initiative (RAI)

http://www.mindflash.com/blog/2013/08/three-simple-ways-to-improve-your-elearning-courses/http://www.mindflash.com/blog/2013/08/three-simple-ways-to-improve-your-elearning-courses/


RAI

• RAI encompasses a variety of enhancements to the CMEP that are intended to benefit both the ERO and industry

• RAI includes compliance and enforcement activities

• Goals of RAI include: Compliance monitoring shifts to using standard, risk-based audit practices

similar to other industries Audit scoping based on a standard approach to assessing an entity’s risk to

reliability Compliance focus shifts to assess strength of management controls relative

to meeting standards Process allows for lower-risk violations to stay in compliance space Visibility of all violations maintained, including self-reported, to allow for

trend analysis


• Two major compliance activates that will impact process: ERO Enterprise Compliance Auditor Manual and Handbook

Companion document to Audit Checklist. Process document that provides guidance to auditors for a consistent, standard audit approach.

Handbook is not a tool that will tell an auditor how to determinecompliance with Reliability Standards, nor will it provide an interpretationof Reliability Standards.

Prototypes and Pilot Programs Develop and test risk-based assessments, scoping, internal controls reviewconcepts, and tests of controls.

RAI Compliance Activities


• NERC and regional compliance websites ERO CMEP IP Procedure documents Timelines and schedules Workshops, training, and presentations

• Reliability Standard Audit Worksheets (RSAWs)• Compliance Application Notices (CANs)• Bulletins• Training Semi-annual ERO Auditor Workshops Semi-annual Standards and Compliance Workshops All auditors must complete an initial training offered by NERC Lead auditors must receive additional NERC training

Compliance Resources


Compliance & Enforcement Home Page

RAI-related information

CANs, Bulletins, Directives, and RSAWs


RSAWs

RSAWs available by Standard


Compliance Resource Documents

AML

2014 CMEP Implementation Plan


• Rules of Procedure• Compliance Monitoring and Enforcement Program• Regional Delegation Agreements• 2014 Annual Implementation Plan• 2014 Actively Monitored List• Generally Accepted Government Auditing Standards• Reliability Standard Audit Worksheets• Compliance Application Notices• Compliance Process Bulletins

Other Useful Links

http://www.nerc.com/pa/comp/Documents/NERC_ROP_Effective_20121220.pdfhttp://www.nerc.com/page.php?cid=1|8|169http://www.nerc.com/FilingsOrders/us/RuleOfProcedureDL/Appendix_4C_CMEP_20130625.pdfhttp://www.nerc.com/AboutNERC/Pages/Regional-Entity-Delegation-Agreements.aspxhttp://www.nerc.com/files/2013%20Implementation%20Plan_RM%20(2).pdfhttp://www.nerc.com/pa/comp/Resources/ResourcesDL/2014%20ERO%20CMEP%20IP%20%20v.0.pdfhttp://www.nerc.com/files/2013%20Implementation%20Plan_RM%20(2).pdfhttp://www.nerc.com/pa/comp/Resources/Pages/default.aspxhttp://www.gao.gov/assets/590/587281.pdfhttp://www.nerc.com/pa/comp/Pages/Reliability-Standard-Audit-Worksheets-(RSAWs).aspxhttp://www.nerc.com/pa/comp/Resources/Pages/Compliance-Application-Notices.aspxhttp://www.nerc.com/pa/comp/Resources/Pages/ComplianceProcessBulletins.aspx

Keynote Remarks: A Risk-Focused EROTHIS PRESENTATION WILL BE POSTED AFTER THE WORKSHOPThomas Burgess, NERC VP and Director of Reliability Assessments and Performance AnalysisMark Lauby, NERC VP and Director of StandardsStandards and Compliance Spring WorkshopApril 1, 2014

NERC Standards Update and Reliability Standards Development Plan (RSDP)Valerie Agnew, NERC Director of Standards DevelopmentStandards and Compliance WorkshopApril 1, 2014


• Report on progress from 2013–2015 RSDP• Provide objective considerations for project prioritization • Allow sufficient flexibility for re-prioritization and addressing

emerging issues• Provided in two documents: 2014–2016 Reliability Standards Development Plan 2014 Reliability Standards Development Work Plan

2014–2016 RSDP Purpose


• The 2013–2015 RSDP identified 30 active projects• Projects completed in 2013 or scheduled to be completed by

the end of first quarter 2014: 17• To be completed after 2013: 8• Five-year reviews: 5• Projects that have been retired: 12

Progress from 2013–2015 RSDP


• As stated in the RSDP, steady-state means: “a stable set of clear, concise, high-quality, and technically sound

Reliability Standards that are results-based, including retirement of requirements that do little to promote reliability.”

• Continues transformation to steady-state Address Paragraph 81 criteria Address FERC directives Results-based High-quality Appropriate content

2014–2016 RSDP


• Reliability Issues Steering Committee (RISC) category rankings• Outstanding regulatory directives• Regulatory deadlines• Paragraph 81 candidates/criteria• Independent Expert Review Panel’s findings: Content and quality assessments Recommendations for retirement

• Periodic review status

Prioritization Considerations


Prioritization Steps

Prioritization Considerations:

RISC category rankings

Regulatory directives

and deadlines

Paragraph 81 candidates

Independent experts content and quality

assessments

2014–2016 RSDP Prioritization:

HighMedium

Low

Pending Technical Committee Input

Project Tracking Spreadsheet:

PMOS and NERC translate into Project Tracking Spreadsheet

Real-time changes with inputs from SC, NERC, RISC, and technical committees






and deadlines



assessments


HighMedium

Low

Pending technical committee input





• 19 current projects• Includes: CIP V5 revisions TOP/IRO revisions Real-time Reliability Monitoring and Analysis Capabilities Dispersed Generation Resources Geomagnetic Disturbance Mitigation (Stage 2)

2014 Work Plan


• Protection Systems: Misoperations (PRC-004-3) Stable Power Swings (PRC-xxx) System Protection Coordination (PRC-027-1) Disturbance Monitoring (PRC-002-2) Protection System Maintenance and Testing (PRC-005-4) Undervoltage Load Shedding (PRC-010-1) Special Protection Systems (PRC-xxx)

2014 Projects


• Emergency Operations (EOP-011-1)• Connecting New Facilities to the Grid (FAC-001-1, FAC-002-1)• Demand Data (MOD C) (MOD-031-1)• Balancing Authority Reliability-based Controls Phase 1: BAL-002-2 Phase 2: BAL-005-02.b, BAL-006-2

• NUC five-year review implementation (NUC-001-2.1)• Voltage and Reactive Control (VAR-002-3)

2014 Projects


• 2014–2016 RSDP July 1–August 9, 2013: Developed initial draft of RSDP in collaboration with

Standards Committee (SC) August 29–September 13, 2013: Posted for comment October 17, 2013: Presented RSDP to SC October 2–October 9, 2013: Posted for comment after further

collaboration with SC October 17: SC endorsement November 7, 2013: Presentation to NERC Board of Trustees

• 2015–2016 RSDP Process starting now

RSDP Timeline


• Regulatory deadlines• Continue transformation to steady-state Address Paragraph 81 criteria Address FERC directives Results-based High-quality Appropriate content Sustainable

• Begin periodic reviews in 2016

2015–2017 Plan Considerations

Standards Committee UpdateScott Miller, Standards Committee Vice ChairStandards and Compliance Spring WorkshopApril 1, 2014


1. Reliability Standards Development Plan 2014-2016 2. Standards Committee Strategic Work Plan 2014-20163. Enhancements to Consensus Building Approach4. Project Management and Oversight Subcommittee Project

Tracking Spreadsheet

Key Topics


• Known Ongoing Work Eliminated 13 unneeded projects

• Future Project Prioritization High Priorities Medium Priorities Low Priorities

• Additional Input for In-Progress Projects Technical Committees Reliability Issues Steering Committee (RISC) Independent Experts Review Panel (IERP) Evaluation Flowcharto Content o Quality

Reliability Standards Development Plan (RSDP) 2014-2016


• Vision, Mission, and Guiding Principles • Work Plan Task No. 1 – Consideration of the IERP Recommendations Task No. 2 – Implementation of the Cost Effective Analysis Process Task No. 3 – Evaluation of 2013 Enhancements and Reforms Task No. 4 – Enhanced Project Management for the Prioritization,

Initiation, and Posting of Standard Development Projects Task No. 5 – Steady-State for SC and Standard Drafting Team-Related

Procedures Task No. 6 – Fourth Quarter Review of SC Strategic Work Plan 2014-2016 Independent Experts’ Appendix F – Bulk Power System Risks Not

Adequately Mitigated (Gaps)

Standards Committee (SC) Strategic Work Plan


• 2013 Approach to Consensus Building Addressed directives, five-year reviews, content/quality, and P81

retirements; focused on results-based standards Informalo Subject matter expert group exploration and researcho Continuous stakeholder outreacho Preparation of draft standard

Formal o Formal Standard Drafting Team takes over

– Follows known process– Continued active outreach and consensus building

Enhancements to Consensus Building Approach


• 2014 Enhancements Projects Carrying Over from 2013o Going forward, all projects will consider directives, content/quality (including

incorporation of IERP recommendations), and P81 criteriao Still focused on results-based standards

Known Projectso Continued outreach during formal development o Use of existing and new consensus building tools, such as straw polls and

providing options for different standard approaches o Continue improvements and timeliness

Approach for New and Emerging Reliability Issues o RISC will work with technical committees to develop a problem statement that

includes suggested solutionso SC will use RISC’s assessment to determine whether to move forward with a

standard



1-4 Months 3-4 months 3-6 months 1-2 months

1-4 months 3-4 months 3-6 months 1-2 months


New and emerging reliability issues

|------------------------------------- 5-16 months ----------------------------------------|

RISC Triage: Guideline?

Standard? Other options?

If standard, then goes to SC: SAR, draft standard,

consensus building

SDT develops and refines; posts for

comment and ballot

Board adoption;FERC filing


• Structure• Coding• What’s included; what’s not included

Project Management and Oversight Subcommittee (PMOS) Project Tracking Spreadsheet


Brian Murphy, Chair Manager, Reliability Standards, NextEra Energy(305) 442-5132 | [email protected]

Scott Miller, Vice ChairManager, Regulatory Policy, MEAG Power(678) 644-3524 | [email protected]

SC Web Pagehttp://www.nerc.com/comm/SC/Pages/default.aspx

Email [email protected] to subscribe to the standards distribution list or the SC plus list.

SC Contact Information

mailto:[email protected]:[email protected]://www.nerc.com/comm/SC/Pages/default.aspxmailto:[email protected]


• RSDP 2014-2016 (see p. 7 for the project prioritization flowchart): http://www.nerc.com/pa/Stand/Standards%20Development%20Plan%20Libr

ary/2014-2016_RSDP_BOT_adopted_111913.pdf

• SC Strategic Work Plan 2014-2016: http://www.nerc.com/comm/SC/Documents/2014-

2016_SC_Strategic_Work_Plan.pdf

• December 2013 Issue of NERC News (see p. 3 for the article on consensus building): http://www.nerc.com/news/newsletters/Newsletters/NERCNews-2013-

12.pdf

Resource Documents

http://www.nerc.com/pa/Stand/Standards%20Development%20Plan%20Library/2014-2016_RSDP_BOT_adopted_111913.pdfhttp://www.nerc.com/comm/SC/Documents/2014-2016_SC_Strategic_Work_Plan.pdfhttp://www.nerc.com/news/newsletters/Newsletters/NERCNews-2013-12.pdf


• Approaches to Consensus Building (see item 13bii of December 11-12, 2013 SC meeting agenda for the proposal endorsed by the SC; final refinements to be approved in March): http://www.nerc.com/comm/SC/Agenda%20Highlights%20and%20Minute

s/SC_Agenda_Pkg_December_2013_Final.pdf

• Project Tracking Spreadsheet: http://www.nerc.com/pa/Stand/Project%20Tracking%20Spreadsheet/Proje

ct_Tracking_Spreadsheet.xlsx

Resource Documents

http://www.nerc.com/comm/SC/Agenda%20Highlights%20and%20Minutes/SC_Agenda_Pkg_December_2013_Final.pdfhttp://www.nerc.com/pa/Stand/Project%20Tracking%20Spreadsheet/Project_Tracking_Spreadsheet.xlsx

NERC StandardsInformationBarb Nutter, NERC Manager of Standards InformationStandards and Compliance Spring WorkshopApril 1, 2014


Standards Information


Industry via NERC.com

Standards Development


Announcements Standards Calendar

• Comment Periods • Ballot Periods• Ballot Results• Committees• Industry Webinars• Technical Conferences• Workshops• Standard Drafting Team

(SDT) Meetings

• SDT Meetings• Industry Webinars• Technical Conferences• Workshops • Standards Committee (SC) Standards Committee Process

Subcommittee (SPCS) Project Management Oversight

Subcommittee (PMOS)

Announcements and Standards Calendar


• Reliability Standards• US Enforcement Dates• US Enforcement

Status/Functional Applicability

• Complete Set of Reliability Standards

• Glossary of Terms Used in Reliability Standards

• VRF Matrix• VSL Matrix

• Reliability Standards Development Plan

• Project Tracking Spreadsheet• Projected Posting Schedule• Standard and Project Cross

Reference• SDT Rosters• SDT Vacancies• Regional Standard

Development

Standards


• Status and applicability at the requirement level

US Enforcement Status/Functional Applicability


• Displays proposed Reliability Standards Under Development

Reliability Standards Under Development


Previous Updated

Standards Left Navigation


• Balloting and Commenting on a separate page now

Updated Standards Page


Commenting Balloting

• Project Page• Electronic Comment Form• Project Documentation• Final Comment Report

• Registered Ballot Body (RBB) Vetting

• Ballot Pools• Ballot Events• Ballot Results

Commenting and Balloting


• Balloting and Commenting Information

New Balloting and Commenting Page


• Displays balloting, open ballot pools, and posted for comments

New Balloting and Commenting Page (Cont’d)


Cast a Vote

Quorum(At least 75% of members of the ballot pool submit a response)

Abstain

Negative

Affirmative


• Standards Program News o Weekly Standards Bulletin

• Standard Processes Manual • Resources• Standards Questions/Feedback: [email protected]• Standards Balloting & Commenting System Questions/Feedback:

[email protected]


http://www.nerc.com/pa/Stand/Pages/default.aspxhttp://www.nerc.com/comm/SC/Documents/Appendix_3A_StandardsProcessesManual.pdfhttp://www.nerc.com/pa/Stand/Resources/Pages/default.aspxmailto:[email protected]:[email protected]


• Monica Benson: [email protected]• Natara Bierria: [email protected]• Arielle Cunningham: [email protected]• Wendy Muller: [email protected]• Barb Nutter: [email protected]

Standards Information Staff

mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]


Tutorial on New Balloting and Commenting SystemWednesday, April 2 from 8:30-10:00 a.m.

Definition of Bulk Electric System ImplementationThomas Burgess, NERC VP and Director of Reliability Assessment and Performance AnalysisStandards and Compliance Spring WorkshopApril 1, 2014


Why is the BES definition important?Why are we doing this?

What is it all about?

Order 773, 773-A, and Order Revising Definition

What are the basic parameters of the BES definition I’s and E’s?

3 RELIABILITY | ACCOUNTABILITY

• Consistent, uniform way to determine BES assets• FERC Order Approval 3/20/2014• Effective 7/1/2014• Transition period through 7/2016• ERO enterprise process, implementation tool • Documents and training readily available • BES project web page – one-stop shopping• Regional and NERC staff resources available

BES Definition At-a-Glance


• Firsthand contact with registered entities• May have lots of questions posed• Provide basic understanding of BES and implementation plans• Provide guidance on where to turn for answers, where to point

registered entities• Common themes and responses – uniform approach across

ERO enterprise

Relevance to Standards and Compliance Attendees


What is the Bulk Electric System?

Inclusions

By Definition By Process

The Bulk Electric

SystemInclusions

Exclusions

Rules of Procedure

Exclusions


BES Implementation Update• BES Exception Request Evaluation Guideline

Guidelines for review and approval of for exception requests Checklist, information sufficiency, RE exception recommendation

• BES Notification Guidelines – Guideline for Reviewing Self-Determined Notifications Guidelines for review of notifications of self-determinations, identify

need for Exception Inclusion Requests Checklist to consider in responding

• BES Definition Reference Document Methodology for consistent categorization of BES elements Common methodology for each region and NERC Basis for “good faith” judgment for registered entity submittals

BES Exception - Notifications


BESnet Enterprise Application Tool• All basic functionality, user acceptance testing, and end-to-end

testing completed – December• Final tool refinement and deferred functionality completed –

March Final testing completed Balance of refinements in enterprise system enhancement

• Ready for initial training, user registration starting April 1• Training/Outreach

March-June Registered entities Regions/NERC direct staff, also corollary staff Opportunistic overviews

BESnet Enterprise Tool


BES Project Page: • FERC Order Nos. 773, 773-A, Order Approving Revisions• NERC Rules of Procedure (Section 500; Appendix 5C)• BES Definition BES Definition Reference Document

• BES Guideline for Reviewing Self-Determined Notifications• BES Exception Request Evaluation Guideline• BESnet Application User Guide• BES Implementation Reference Document• Frequently Asked Questions (FAQs)• Overview BES Implementation Milestones - Schedule• Technical Justification White Papers

Reference Documents


Timeline

ERO staff Training

ERO Staff Training on Definition and Exception Process

Mid Feb 2014 Feb 24 Mar 31 Early Jun July 1


• First Quarter 2014: Completion and posting of reference documents• February 2014: BESnet tool final coding and user acceptance tests• March 2014: Projected issue date of FERC’s final order• March 2014: NERC and Regional Entity training on process, BESnet

tool• April/May 2014: Registered Entity training on implementation and

BESnet tool• June 2014: BESnet tool user registration• July 1, 2014: Implementation and effective date• 2014-2015: Submit self-determined notifications and Exception

Requests• July 2016: Compliance date for newly identified Elements

Timeline


• FERC Order issued March 20, 2014• Approved all aspects of BES definition and revisions• Addressed various comments consistent with NERC proposal

Radial Systems – E1 Local Networks – E3 Dispersed Power Producing Resources – I4 Reactive Power Devices – E4

• Supported effective date – July 1, 2014• Next steps:

BES reference and implementation materials Deployment of communications/training beginning Q2 2014 Registered entity preparation for July 1, 2014 effective date

Order Approving Revised Definition


• No change to 75/20 MVA thresholds• Directives from FERC Orders 773 and 773-A addressed

Collector systems for dispersed power producing resources(Inclusion I4b) Generator interconnection facilities (Exclusions E1 – radial systems and

E3 – local networks) Floor removed from local network exclusion (Exclusion E3) Loop flow in radial systems addressed through introduction of 50 kV

threshold value (Exclusion E1)

Highlights of Phase 2 Changes


• Dispersed Generation Individual Units Standard Authorization Request (SAR) pending to modify standards

applicability sections for Generator Owners (GO)/Generator Operators (GOP)

Proposes reliability standards applicability at the point of aggregation at 75 MVA or above

• Large End-use Industrial Customers 50 kV threshold eliminates consideration of most of parallel connections Loops operated below 50 kV unlikely carry parallel through-flow with BES,

can be disregarded in applying E1 Does not preclude self-determined exclusions of elements

Key Points


• Step 1 – Core BES Definition Establish 100 kV bright-line Identify Real and Reactive Power resources connected at 100 kV or higher

• Step 2 – Inclusions Apply definition to identify specific BES elements Address specific criteria (Transmission Elements, Real and Reactive Power

resources)

• Step 3 – Exclusions Evaluate specific situations for potential exclusion from the BES

• Self-Determined Notifications

Overall – provide for a consistent determination of an Element as BES or Non-BES

High-level Overview: BES Definition


Self-Determination Notifications

Assure that entities appropriately implement BES definition• All entities must apply the BES Definition Facilities may be declassified or newly classified as BES

• NERC and Regional Entities must be notified of BES Element Status changes Newly identified inclusions to the BES or newly identified exclusions Beginning July 1, 2014

• The obligation to notify is ongoing• Notification failure does not relieve a registered entity from any

compliance responsibility


Self-Determination Notification Process

• BESnet is the enterprise application for reporting notifications NOT a database of all BES Elements

• User Account will be needed to submit a Notification• Only asset owners submit Notifications May not be a currently registered entity

• Self-determined Notification - permanent NERC records


Self-Determination Notification Information Requirements

• Does not require justification for element exclusion• Definition application must be in good faith Application of BES definition as in the BES Definition One-line diagrams For Retail Generation (E2) Exclusion notificationso Net Capacity Transactional Data (12 months of hourly data)o Standby, back-up, and maintenance power service documentation

For Local Network (E3) Exclusion notificationso Power Flow Transactional Data (24 months of hourly data)

• Each Regional Entity is responsible for verifying their respective Regional BES self-determined designations Regions may seek further information


Self-Determination Notification Decision

• Element ceases as part of the BES upon Notification In absence of bad faith Unless NERC makes a contrary determination in the exception process Cease compliance obligations for facilities no longer considered BES

• If a Regional Entity disagrees with the classification Contact registered entity to amend Notification if feasible Initiate an Exception Request

• Newly determined facilities In compliance within 24-month period


What is an Exception Request?

• Formal Exception Process Rule of Procedure 509 and Appendix 5C

• Follows Application of the BES Definition Determines if element is included or excluded Exception requests allow for special situations Case-by-case evaluation by Regions, NERC Demonstrate element status as supporting reliable operation

• Entities that may submit an exception: Owner Regional Entity Entity with Scope of Responsibility [Planning Authority, Reliability

Coordinator, Transmission Operator, Transmission Planner, or Balancing Authority]


The Exception Request Process

• The Main Steps in the Exception Process: Exception Request Submittal Regional Entity (RE) Initial

Review RE Substantive Review and

Recommendation NERC Review and Final

Decision



• Substantive Review Review facts and circumstances Element is or is not necessary for

the reliable operation of the interconnected bulk power transmission system

If RE recommends disapproval, a Technical Review Panel (TRP) must be assembled

TRP may be used in other instances at its discretion



• NERC Review and Final Decision NERC Review Panel (NRP)

recommends approval or disapproval NERC President and CEO may approve

or disapprove the NRP recommendation

Submitting Entity either accepts the NERC decision, or challenges it

• During the pendency of an Exception Request status of an Element(s) unchanged from BES Definition result


Content of an Exception Request

• Separated to ensure transparency, protect confidentiality Section I – Basic information, non-confidential. Section II – Restricted to persons involved in review Section III – Classified National Security Information not released

• All Section I-III Required Information must be provided to process Exception Request For Each Element or set of connected Elements Multiple, similar Elements, may be combined


Support Information

• Evaluation may require: Review of added Regional Entity requested information Some level of system analysis Current one line diagram Interconnection-wide base case Supporting data and studies

• Information needed will vary on the configuration


All Exception Requests

• Part of monitored Facility or permanent Flowgate or a major transfer path

• Part of a Nuclear Plant Off-Site Power Supply• Effects of not requiring the Element(s) to comply with

requirements• Part of a Special Protection System/Remedial Action Scheme• Plays a role in meeting the Reliable Operation of the system• Necessary for Reliable Operation - transfer capability, system

stability, or voltage control• Loading impacted by changes in generation dispatch or outages of

other elements• Available short circuit current and potential effects of faults• Whether the Element is inter-regional


NERC Challenge Process

• Registered Entity may submit a written challenge Within thirty (30) days following NERC’s decision Must state the basis of the objection and provide information supporting

the challenge

• During the pendency of a challenge Compliance status of an Element(s) is unchanged



• BOTCC will render a decision• May appeal BOTCC decision

to applicable governmental authority



• BESnet is the application for submitting Exception Requests• A User Account will be needed to submit a Notification


Implementation Expectations

• New BES definition expected to result in limited number of - Assets being removed from the BES Changes to overall registration

• Registered Entities should Review guidance and reference materials Participate in outreach efforts during Q1-2, 2014


Training and Outreach

• Reference and guidance materials being finalized, to be posted on BES Implementation Project webpage Application of BES definition Process for inclusions, exclusions, and self-notifications Registration aspects Reliability Standards applicability Oversight

• Implementation outreach efforts Scheduled across first half 2014 Training and orientation for registered entities Workshops and webinars

http://www.nerc.com/pa/RAPA/Pages/BES.aspx


• FERC Order Nos. 773 and 773-A• NERC Rules of Procedure: Section 500; Appendix 5C

• Bulk Electric System Definition: BES Definition Reference Document

• BES Guideline for Reviewing Self-Determined Notifications• BES Exception Request Evaluation Guideline• BESnet Application Users Guide• BES Implementation Reference Document• Frequently Asked Questions (FAQs)• Overview BES Implementation Milestones – Schedule • Technical Justification White Papers

Reference Documents


BES Definition at-a-glance

• Consistent, uniform way to determine BES assets• FERC Order Approval 3/20/2014• Effective 7/1/2014• Transition period through 7/2016• ERO enterprise process, implementation tool • Documents and training readily available • BES project web page – one stop shopping• Regional and NERC staff resources available


Huggins & Mineo_Standards and Compliance 101Burgess & Lauby_Keynote RemarksAgnew_NERC Standards Update and RSDPMiller_SC UpdateNutter_NERC Standards InformationBurgess_BES Definition