[Federal Register Volume 88, Number 120 (Friday, June 23, 2023)]
[Rules and Regulations]
[Pages 41262-41287]
[FR Doc No: 2023-13286]

Vol. 88

Friday,

No. 120

June 23, 2023

Part IV

Department of Energy

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Federal Energy Regulatory Commission

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18 CFR Part 40

Transmission System Planning Performance Requirements for Extreme
Weather; Final Rule

Federal Register / Vol. 88, No. 120 / Friday, June 23, 2023 / Rules
and Regulations

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 40

[Docket No. RM22-10-000; Order No. 896]

Transmission System Planning Performance Requirements for Extreme
Weather

AGENCY: Federal Energy Regulatory Commission, Department of Energy.

ACTION: Final rule.

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SUMMARY: The Federal Energy Regulatory Commission directs the North
American Electric Reliability Corporation, the Commission-certified
Electric Reliability Organization, to develop a new or modified
Reliability Standard no later than 18 months of the date of publication
of this final rule in the Federal Register to address reliability
concerns pertaining to transmission system planning for extreme heat
and cold weather events that impact the Reliable Operation of the Bulk-
Power System. Specifically, we direct the North American Electric
Reliability Corporation to develop a new or modified Reliability
Standard that requires the following: development of benchmark planning
cases based on prior extreme heat and cold weather events and/or future
meteorological projections; planning for extreme heat and cold events
using steady state and transient stability analyses that cover a range
of extreme weather scenarios, including the expected resource mix's
availability during extreme weather conditions and the broad area
impacts of extreme weather; and corrective action plans that include
mitigation activities for specified instances where performance
requirements during extreme heat and cold events are not met.

DATES: This rule is effective September 21, 2023.

FOR FURTHER INFORMATION CONTACT:

Mahmood Mirheydar (Technical Information), Office of Electric
Reliability, Federal Energy Regulatory Commission, 888 First Street NE,
Washington, DC 20426,<PHONE_NUMBER>, [email protected]
Gonzalo E. Rodriguez (Legal Information), Office of the General
Counsel, Federal Energy Regulatory Commission, 888 First Street NE,
Washington, DC 20426,<PHONE_NUMBER>, [email protected]

SUPPLEMENTARY INFORMATION:

Table of Contents

                                                               Paragraph
                                                                 Nos.

Introduction................................................           1
II. Background..............................................           8
    A. Legal Authority......................................           8
    B. Reliability Standard TPL-001-5.1 (Transmission System          10
     Planning Performance Requirements).....................
    C. Prior Commission Actions To Address the Reliability            14
     Impacts of Extreme Weather.............................
    D. Notice of Proposed Rulemaking........................          17
III. The Need for Reform....................................          20
IV. Discussion..............................................          25
    A. Directive to NERC To Develop New or Modified                   25
     Reliability Standard...................................
    B. Develop Benchmark Events and Planning Cases Based on           30
     Major Prior Extreme Heat and Cold Weather Events and/or
     Meteorological Projections.............................
        1. Comments.........................................          32
        2. Commission Determination.........................          35
    C. Definition of ``Wide-Area''..........................          41
        1. Comments.........................................          44
        2. Commission Determination.........................          50
    D. Entities Responsible for Developing Benchmark Events           51
     and Planning Cases, and for Conducting Transmission
     Planning Studies of Wide-Area Events...................
        1. Comments.........................................          53
            a. Entity Responsible for Development of                  53
             Benchmark Events...............................
            b. Entity Responsible for Development of                  54
             Planning Cases and Conducting Transmission
             Planning Studies of Wide-Area Events...........
        2. Commission Determination.........................          58
            a. Entity Responsible for Establishing Benchmark          58
             Events.........................................
            b. Entities Responsible for Development of                60
             Planning Cases and Conducting Transmission
             Planning Studies of Wide-Area Events...........
    E. Coordination Among Registered Entities and Sharing of          63
     Data and Study Results.................................
        1. Comments.........................................          66
        2. Commission Determination.........................          72
    F. Concurrent/Correlated Generator and Transmission               78
     Outages................................................
        1. Comments.........................................          82
        2. Commission Determination.........................          88
    G. Conduct Transmission System Planning Studies for               95
     Extreme Heat and Cold Weather Events...................
        1. Steady State and Transient Stability Analyses....          95
            a. Comments.....................................          98
            b. Commission Determination.....................         111
        2. Sensitivity Analysis.............................         118
            a. Comments.....................................         121
            b. Commission Determination.....................         124
        3. Modifications to the Traditional Planning                 127
         Approach...........................................
            a. Comments.....................................         131
            b. Commission Determination.....................         134
    H. Implement a Corrective Action Plan if Performance             139
     Standards Are Not Met..................................
        1. Comments.........................................         143
            a. Jurisdictional Issues........................         143
            b. Corrective Action Plans......................         144
            c. Generation and Transmission Capacity Increase         148
             and Resource Adequacy Issues...................

            d. Notification to Applicable Regulatory                 151
             Authorities or Governing Bodies Responsible for
             Retail Electric Service Issues.................
        2. Commission Determination.........................         152
            a. Jurisdictional Issues........................         154
            b. Circumstances That Require Corrective Action          157
             Plans..........................................
            c. Generation and Transmission Capacity Increase         161
             and Resource Adequacy Issues...................
            d. Notification to Applicable Regulatory                 165
             Authorities or Governing Bodies Responsible for
             Retail Electric Service Issues.................
    I. Other Extreme Weather-Related Events and Issues......         169
        1. Comments.........................................         170
        2. Commission Determination.........................         177
    J. Reliability Standard Development and Implementation           181
     Timeline...............................................
        1. Comments.........................................         182
        2. Commission Determination.........................         188
V. Information Collection Statement.........................         194
VI. Environmental Analysis..................................         196
VII. Regulatory Flexibility Act.............................         197
VIII. Document Availability.................................         200
IX. Effective Date and Congressional Notification...........         203
Appendix A: Commenter Names.................................

I. Introduction

    1. Pursuant to section 215(d)(5) of the Federal Power Act (FPA),\1\
the Commission directs the North American Electric Reliability
Corporation (NERC), the Commission-certified Electric Reliability
Organization (ERO), to submit a new Reliability Standard or
modifications to Reliability Standard TPL-001-5.1 that addresses
concerns pertaining to transmission system planning for extreme heat
and cold weather events that impact the Reliable Operation \2\ of the
Bulk-Power System.\3\
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    \1\ 16 U.S.C. 824o(d)(5).
    \2\ The FPA defines ``Reliable Operation'' as ``operating the
elements of the Bulk-Power System within equipment and electric
system thermal, voltage, and stability limits so that instability,
uncontrolled separation, or cascading failures of such system will
not occur as a result of a sudden disturbance, including a
cybersecurity incident, or unanticipated failure of system
elements.'' 16 U.S.C. 824o(a)(4).
    \3\ The Bulk-Power System is defined in the FPA as ``facilities
and control systems necessary for operating an interconnected
electric energy transmission network (or any portion thereof), and
electric energy from generating facilities needed to maintain
transmission system reliability. The term does not include
facilities used in the local distribution of electric energy.'' Id.
824o(a)(1).
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    2. We take this action to address challenges associated with
planning for extreme heat and cold weather events, particularly those
that occur during periods when the Bulk-Power System must meet
unexpectedly high demand.\4\ Extreme heat and cold weather events have
occurred with greater frequency in recent years, and are projected to
occur with even greater frequency in the future.\5\ These events have
shown that load shed during extreme temperature result in unacceptable
risk to life and have extreme economic impact.\6\ As such, the impact
of concurrent failures of Bulk-Power System generation and transmission
equipment and the potential for cascading outages \7\ that may be
caused by extreme heat and cold weather events should be studied and
corrective actions should be identified and implemented.
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    \4\ Technical Conference June 1-2, 2021, Climate Change, Extreme
Weather, and Electric System Reliability, Docket No. AD21-13-000
(June 1-2, 2021), June 1, 2021 Tr. 26: 3-7 (Derek Stenclik, Founding
Partner, Telos Energy, Inc.), 31:7-8 (Judy Chang, Undersecretary of
Energy, Massachusetts).
    \5\ See e.g., Environmental Protection Agency, Climate Change
Indicators: Weather and Climate (May 12, 2021) (EPA Climate Change
Indicators), https://www.epa.gov/climate-indicators/weather-climate
(showing an upward trend in extreme heat and cold weather events).
NOAA, Adam Smith, 2022 U.S. Billion-dollar Weather and Climate
Disasters in Historical Context (Jan. 10, 2023), https://www.climate.gov/news-features/blogs/2022-us-billion-dollar-weather-and-climate-disasters-historical-context.
    \6\ FERC, NERC, and Regional Entity Staff, The February 2021
Cold Weather Outages in Texas and the South Central United States,
at 9, 192 (Nov. 16, 2021), https://www.ferc.gov/media/february-2021-cold-weather-outages-texas-and-south-central-united-states-ferc-nerc-and (2021 Cold Weather Event Report).
    \7\ NERC Glossary of Terms Used in Reliability Standards
(Updated Mar. 8, 2023) (NERC Glossary). NERC defines ``cascading''
as, the ``uncontrolled successive loss of System Elements triggered
by an incident at any location. Cascading results in widespread
electric service interruption that cannot be restrained from
sequentially spreading beyond an area predetermined by studies.''
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    3. At the Commission's June 1-2, 2021 technical conference on
Climate Change, Extreme Weather, and Electric System Reliability, there
was consensus among panelists that planners cannot simply project
historical weather patterns forward to effectively forecast the future,
since climate change has made the use of historical weather
observations no longer representative of future conditions.\8\ For
example, extreme summer heat in regions like the Pacific Northwest and
extreme winter cold in regions like Texas have increased demand for
electricity at times when historically demand has been low.\9\ As
events such as these will likely continue to present challenges in the
future, transmission planners and planning coordinators must account
for this new reality in their planning processes.\10\
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    \8\ June 1, 2021 Tr. 30:2-3 (Chang), 31:12-18 (Lisa Barton,
Executive Vice President/Chief Operating Officer, American Electric
Power).
    \9\ June 1, 2021 Tr. 31:1-6 (Chang); June 2, 2021 Tr. 72:8-10
(Amanda Frazier, Senior Vice President of Regulatory Policy, Vista
Corp.); 9:1-5 (Wesley Yeomans, Vice President of Operations, New
York Independent System Operator, Inc. (NYISO)) (noting that in New
York the majority of the extreme conditions were cold weather
related but that there can be heat waves in New York City, and more
heat waves are expected).
    \10\ June 1, 2021 Tr. 35:1-6 (Chang). See also US News,
Blackouts in US Northwest Due to Heat Wave, Deaths Reported (June
29, 2021), https://www.usnews.com/news/business/articles/2021-06-29/rolling-blackouts-for-parts-of-us-northwest-amid-heat-wave; Judah
Cohen et al., Linking Arctic Variability and Change With Extreme
Winter Weather in the United States, 373 Sci. 1116, 1120 (2021), (a
study connecting the 2021 extreme cold weather event in Texas and
the South-central United States to global warming-induced weather
anomalies that are likely to continue to produce severe winter storm
events).
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    4. Since 2011, the country has experienced at least seven major
extreme heat and cold weather events,\11\ each of which put stress on
the Bulk-Power System and resulted in some degree of load shed. In some
cases, these events nearly caused system collapse

and uncontrolled blackouts, which were avoided due to system operator
actions.
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    \11\ See Transmission System Planning Performance Requirements
for Extreme Weather, Notice of Proposed Rulemaking, 87 FR 38,020
(June 27, 2023), 179 FERC ] 61,195 at PP 24-36 (2022) (NOPR)
(discussing these prior events in detail).
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    5. Given the reliability risks associated with extreme heat and
cold weather events, including the potential for widespread blackouts,
maintaining the reliability of the Bulk-Power System requires
transmission system planning to account for the potential impact of
extreme heat and cold weather over wide geographical areas, and to
consider the changing resource mix. Reliability Standard TPL-001-4 \12\
was developed to establish transmission system planning performance
requirements that ensure that the Bulk-Power System operates reliably
over a broad spectrum of system conditions and following a wide range
of probable contingencies.\13\ Both it and its successor, TPL-001-5.1,
include provisions for transmission planners and planning coordinators
to study system performance under extreme events based on their
experience; \14\ however, neither standard specifically requires
entities to conduct performance analysis for extreme heat and cold
weather, despite the fact that such conditions have clearly
demonstrated a risk to the Reliable Operation of the Bulk-Power System,
thus leaving a reliability gap in system planning.
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    \12\ Effective July 1, 2023, Reliability Standard TPL-001-4 will
be replaced by Reliability Standard TPL-001-5.1. Unless otherwise
specified, the use of Reliability Standard TPL-001-5.1 in this final
rule also refers to its predecessor, Reliability Standard TPL-001-4.
    \13\ Reliability Standard TPL-001-5, at 1.
    \14\ Id. at tbl. 1.
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    6. To address this reliability gap, we direct NERC to develop a new
or modified Reliability Standard that requires the following: (1) the
development of benchmark planning cases based on information such as
major prior extreme heat and cold weather events and/or future
meteorological projections; (2) planning for extreme heat and cold
weather events using steady state and transient stability analyses
expanded to cover a range of extreme weather scenarios, including
expected availability of the resource mix during extreme heat and cold
weather conditions, and including the broad area impacts of extreme
heat and cold weather; and (3) the development of corrective action
plans that mitigate specified instances where performance requirements
during extreme heat and cold weather events are not met. In directing
NERC to develop a new or modified Reliability Standard, we are not
proposing specific requirements. Instead, we identify concerns that
should be addressed by the proposed Reliability Standard. NERC may
propose to develop a new or modified Reliability Standard that address
our concerns in an equally efficient and effective manner; however,
NERC's proposal should explain how it addresses the Commission's
concerns.\15\
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    \15\ See e.g., Mandatory Reliability Standards for the Bulk-
Power Sys., Order No. 693, 72 FR 16416 (Apr. 4, 2007), 118 FERC ]
61,218, at PP 186, 297, order on reh'g, Order No. 693-A, 72 FR 40717
(July 25, 2007), 120 FERC ] 61,053 (2007) (``where the Final Rule
identifies a concern and offers a specific approach to address the
concern, we will consider an equivalent alternative approach
provided that the ERO demonstrates that the alternative will address
the Commission's underlying concern or goal as efficiently and
effectively as the Commission's proposal'').
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    7. We direct NERC to submit the proposed new or modified
Reliability Standard no later than 18 months from the publication of
this final rule in the Federal Register. We believe that an 18-month
deadline provides sufficient time for NERC to develop a responsive
Standard in consideration of the issues involved and the steps in
NERC's standards development process. Further, we direct NERC to ensure
that the proposed new or modified Reliability Standard becomes
mandatory and enforceable beginning no later than 12 months from the
effective date of Commission approval of the new or modified
Reliability Standard.

II. Background

A. Legal Authority

    8. Section 215 of the FPA provides that the Commission may certify
an ERO, the purpose of which is to develop mandatory and enforceable
Reliability Standards, subject to Commission review and approval.\16\
Reliability Standards may be enforced by the ERO, subject to Commission
oversight, or by the Commission independently.\17\ Pursuant to section
215 of the FPA, the Commission established a process to select and
certify an ERO,\18\ and subsequently certified NERC.\19\
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    \16\ 16 U.S.C. 824o(c).
    \17\ Id. 824o(e).
    \18\ Rules Concerning Certification of the Elec. Reliability
Org. & Procedures for the Establishment, Approval, & Enf't. of Elec.
Reliability Standards, Order No. 672, 71 FR 8662 (Feb. 17, 2006),
114 FERC ] 61,104, order on reh'g, Order No. 672-A, 71 FR 19814
(Apr. 18, 2006), 114 FERC ] 61,328 (2006).
    \19\ N. Am. Elec. Reliability Corp., 116 FERC ] 61,062, order on
reh'g and compliance, 117 FERC ] 61,126 (2006), aff'd sub nom.
Alcoa, Inc. v. FERC, 564 F.3d 1342 (D.C. Cir. 2009).
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    9. Pursuant to section 215(d)(5) of the FPA, the Commission has the
authority, upon its own motion or upon complaint, to order the ERO to
submit to the Commission a proposed Reliability Standard or a
modification to a Reliability Standard that addresses a specific matter
if the Commission considers such a new or modified Reliability Standard
appropriate to carry out section 215 of the FPA.\20\ Further, pursuant
to Sec.  39.5(g) of the Commission's regulations, the Commission may
order a deadline by which the ERO must submit a proposed or modified
Reliability Standard, or when ordering the ERO to submit to the
Commission a proposed Reliability Standard that addresses a specific
matter.\21\
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    \20\ 16 U.S.C. 824o(d)(5).
    \21\ 18 CFR 39.5(g) (2022).
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B. Reliability Standard TPL-001-5.1 (Transmission System Planning
Performance Requirements)

    10. Transmission system planning refers to the evaluation of future
transmission system performance and creation of corrective action plans
that include mitigation to remedy identified deficiencies.\22\ The
planning horizon associated with transmission system planning covers
near term (one to five years), long-term (six to ten years), and
beyond.\23\
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    \22\ NERC Glossary (defining ``Planning Assessment'' as
``documented evaluation of future Transmission System performance
and Corrective Action Plans to remedy identified deficiencies'').
    \23\ Id. (defining ``Near-Term Transmission Planning Horizon''
and ``Long-Term Transmission Planning Horizon'').
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    11. Reliability Standard TPL-001-5.1 establishes minimum
transmission system planning performance requirements to plan a Bulk-
Power System that will operate reliably over a broad spectrum of system
conditions and following a wide range of probable contingencies.\24\
Under Requirement R2 of Reliability Standard TPL-001-5.1, each
transmission planner and planning coordinator must prepare an annual
planning assessment for its portion of the Bulk-Power System.\25\ This
planning assessment is required for both near-term and long-term
transmission planning horizons.\26\
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    \24\ Reliability Standard TPL-001-5.1, Purpose.
    \25\ Id., at Requirement 2. Further, steady-state analyses are a
snapshot in time where load and system conditions (e.g., generators,
lines, facilities) are modeled as constant (not as changing over
time). The analysis will either solve (converge numerically) or not
solve (diverge numerically). See IEEE, Transactions on Power
Systems, Vol. 19, No. 2, (May 2004) (power system stability is the
ability of an electric power system, for a given initial operating
condition, to regain a state of operating equilibrium after being
subjected to a physical disturbance, with most system variables
bounded so that practically the entire system remains intact); see
also, Kundur, Prabha, Power System Stability and Control, McGraw
Hill, at 26 (1994).
    \26\ See Reliability Standard TPL-001-5.1, at Requirement 2.1
(Near-Term Transmission Planning Horizon) and Requirement R.2.2
(Long-Term Transmission Planning Horizon).
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    12. Requirements R3 and R4 of Reliability Standard TPL-001-5.1

require in part that planning coordinators and transmission planners
conduct steady state and stability studies of pre-specified extreme
events and evaluate possible actions designed to reduce the likelihood
or mitigate the consequences and adverse impacts of the event(s), if
the analysis concludes that the pre-selected extreme events cause
cascading outages.
    13. Table 1 of Reliability Standard TPL-001-5.1 includes a list of
examples of planning events (i.e., Category P1 through P7) \27\ for
which specific studies may be required based on the entity's own
evaluation that such an event could occur within its operating area.
Section 3.a of Table-1 (Steady State & Stability Performance Extreme
Events) states that steady state analysis should be conducted for wide-
area events affecting the transmission system based on system
configuration and how it can be affected by events such as wildfires
and severe weather (e.g., hurricanes and tornadoes). In addition,
section 3.b serves as a catch-all provision, stating that steady state
analysis should be performed for ``other events based upon operating
experience that may result in wide-area disturbances.''
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    \27\ Categories P1 through P7 are defined in TPL-001-5.1 in
Table 1--Steady State & Stability Performance Planning Events.
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C. Prior Commission Actions To Address the Reliability Impacts of
Extreme Weather

    14. On June 1 and 2, 2021, the Commission convened a staff-led
technical conference on Climate Change, Extreme Weather, and Electric
System Reliability.\28\ The Commission sought to understand, among
other things, whether further action from the Commission is needed to
help achieve an electric system that can withstand, respond to, and
recover from extreme weather events.\29\
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    \28\ Climate Change, Extreme Weather, and Electric System
Reliability, Notice of Technical Conference, Docket No. AD21-13-000,
at 1 (Mar. 5, 2021).
    \29\ Id. at 2.
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    15. In the pre- and post-conference comments, industry experts
agreed that extreme weather events are likely to become more severe and
frequent in the future.\30\ They also acknowledged the challenges
associated with planning for extreme events, including shifting
scheduled maintenance and canceling or recalling transmission and
generation assets from scheduled maintenance to meet demand under
unexpected circumstances.\31\ Further, commenters discussed potential
changes to the Reliability Standards to address planning and
operational preparedness for energy adequacy risks,\32\ contingencies
related to extreme weather events, and wide-area transmission planning
and development challenges, among others.\33\ Comments also addressed
more directly the potential reliability gaps in the existing set of
Reliability Standards, including Reliability Standard TPL-001-4, and
identified potential solutions.\34\
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    \30\ CAISO Pre-Conference Comments at 1-3; California Public
Utilities Commission Pre-Conference Comments at 4; Oregon Public
Utilities Commission Pre-Conference Comments at 2-3; NYISO Pre-
Conference Comments at 4; AEP Pre-Conference Comments at 5.
    \31\ June 2, 2021, Tr. at 21-23 (Wesley Yeomans, Vice President
of Operations, NYISO).
    \32\ ISO-New England Inc. Pre-Conference Comments at 10.
    \33\ Midcontinent Independent System Operator (MISO) Pre-
Conference Comments at 4-5, 14-17.
    \34\ See e.g., NERC Pre-Conference Comments at 6; MISO Post-
Conference Comments at 20; Pacific Gas & Electric Company Pre-
Conference Comments at 19-20; PJM Post-Conference Comments at 21;
CAISO Post-Conference Comments at 10.
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    16. On August 24, 2021, and February 16, 2023, the Commission
approved revised Reliability Standards to address some of the
reliability risks posed by extreme cold weather.\35\ These Reliability
Standards, among other things, require generators to implement plans
for cold weather preparedness and implement freeze protection measures
to mitigate the reliability impacts of extreme cold weather on their
generating units. The new and revised standards also require the
balancing authority, transmission operator, and reliability coordinator
to plan and operate the grid reliably during cold weather conditions by
requiring the exchange of certain information related to the
generator's capability to operate under such conditions.\36\
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    \35\ N. Am. Elec. Reliability Corp., 176 FERC ] 61,119 (2021).
The Commission approved proposed Reliability Standards EOP-011-2
(Emergency Preparedness and Operations); IRO-010-4 (Reliability
Coordinator Data Specification and Collection); and TOP-003-5
(Operational Reliability Data) (collectively, the Cold Weather
Reliability Standards) and Order Approving Extreme Cold Weather
Reliability Standards EOP-011-3 and EOP-012-1 and Directing
Modification of Reliability Standard EOP-012-1, 182 FERC ] 61,094
(2023).
    \36\ Id. P 3.
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D. Notice of Proposed Rulemaking

    17. On June 26, 2022, the Commission issued the Notice of Proposed
Rulemaking (NOPR) proposing to direct NERC to develop a new or modified
Reliability Standard to address a lack of a long term planning
requirement for extreme heat and cold weather events.\37\ Specifically,
the Commission proposed to direct NERC to develop either modifications
to Reliability Standard TPL-001-5.1 or a new Reliability Standard, to
require the following: (1) development of benchmark planning cases
based on major prior extreme heat and cold weather events and/or
meteorological projections; (2) planning for extreme heat and cold
weather events using steady state and transient stability analyses
expanded to cover a range of extreme weather scenarios including the
expected resource mix's availability during extreme heat and cold
weather conditions, and including the wide-area impacts of extreme heat
and cold weather; and (3) development of corrective action plans that
mitigate any instances where performance requirements for extreme heat
and cold weather events are not met.\38\
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    \37\ NOPR, 179 FERC ] 61,195 at P 47.
    \38\ Id. P 51.
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    18. The NOPR preliminarily found that, based on the wide geographic
impacts on the Bulk-Power System of previous extreme heat and cold
weather events, the study criteria for extreme heat and cold events
should include a consideration of wide-area conditions affecting
neighboring regions and their impact on one planning area's ability to
rely on the resources of another region during the weather event.\39\
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    \39\ Id. P 67.
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    19. The NOPR sought comments on all aspects of the proposed
directives, including among others: (1) the development of benchmark
planning cases; (2) requiring transmission planning studies of wide-
area extreme heat and cold events; (3) the study of concurrent
generator and transmission outages; (4) the analysis of sensitivities;
(5) modifications to current deterministic planning approaches; (6)
coordination among registered entities and sharing of study results;
(7) requiring entities to implement corrective action plans if
performance standards are not met; and (8) whether the final rule
should address other extreme weather events beyond heat and cold
events. The comment period for the NOPR ended on August 26, 2022, and
the Commission received 33 sets of comments.\40\
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    \40\ A list of commenters to the NOPR and the abbreviated names
used in this final rule appear in Appendix A.
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III. The Need for Reform

    20. Extreme weather-related events that spread across large
portions of the country over the past decade demonstrate the challenges
to transmission planning from extreme heat and cold weather patterns.
The NOPR discussed seven major extreme heat and cold weather events
that had

occurred since 2011.\41\ Of these, four (2011, 2013, 2018, and 2021)
were extreme cold weather events that nearly caused system collapse if
the operators had not acted to shed load.\42\ The remaining three
events (2014, 2020, and 2021) were extreme heat weather events that
resulted in generation losses and varying degrees of load shedding.\43\
Since the issuance of the NOPR, another extreme cold weather event
indicated reliability challenges faced by the Bulk-Power System. In
December 2022, Winter Storm Elliott caused extreme cold conditions that
significantly stressed the Bulk-Power System, forcing some utilities to
deploy rolling blackouts to preserve Bulk-Power System reliability.\44\
These extreme heat and cold events demonstrate a risk to Reliable
Operation of the Bulk-Power System.
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    \41\ For a full discussion of these extreme weather events, see
NOPR, 179 FERC ] 61,195 at PP 24-33.
    \42\ See e.g., FERC and NERC Staff Report, Outages and
Curtailments During the Southwest Cold Weather Event of February 1-
5, 2011, at 7 (Aug. 2011), https://www.ferc.gov/sites/default/files/2020-05/ReportontheSouthwestColdWeatherEventfromFebruary2011Report.pdf
(impacting nearly 4.4 million electric customers in ERCOT); 2013 PJM
Heat Wave Analysis at 5 (impacting approximately 45,000 customers in
PJM).
    \43\ See, e.g., 2021 Cold Weather Event Report at 133.
    \44\ FERC, FERC, NERC to Open Joint Inquiry into Winter Storm
Elliott (Dec. 2022), https://www.ferc.gov/news-events/news/ferc-nerc-open-joint-inquiry-winter-storm-elliott.
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    21. While wide-area extreme heat and cold weather events may not
occur every year, their frequency and magnitude are expected to
increase. The National Oceanic and Atmospheric Administration's (NOAA)
data and analyses show an increasing trend in extreme heat and cold
weather events,\45\ and the U.S. Environmental Protection Agency
climate change indicators also show upward trends in heatwave
frequency, duration, and intensity.\46\ NOAA states that climate change
is also driving more compound events, i.e., multiple extreme events
occurring simultaneously or successively, such as concurrent heat waves
and droughts, and more extreme heat conditions in cities.\47\
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    \45\ See NOAA., Nat'l Centers for Envtl. Info., U.S. Billion-
Dollar Weather and Climate Disasters (2023), https://www.ncei.noaa.gov/access/billions/.
    \46\ U.S. EPA, Climate Change Indicators in the United States
(last updated May 2, 2023), https://www.epa.gov/climate-indicators.
    \47\ NOAA, 2022 U.S. Billion Dollar Weather and Climate
Disasters in Historical Context (2023), https://www.climate.gov/news-features/blogs/2022-us-billion-dollar-weather-and-climate-disasters-historical-context.
---------------------------------------------------------------------------

    22. These conditions have created an urgency to address the
negative impact of extreme weather on the reliability of the Bulk-Power
System. To that end, the directives to NERC in this final rule aim to
improve system planning specifically for extreme heat and cold weather
events. The potential impact of widespread extreme heat and cold events
on the reliability of the Bulk-Power System can be modeled and studied
in advance as part of near-term and long-term transmission system
planning. Responsible entities could then use the studies to develop
transmission system operational strategies or corrective action plans
with mitigations that could be deployed in preparation for extreme heat
and cold events.
    23. The current transmission planning Reliability Standards,
however, do not obligate transmission planners and planning
coordinators to consider extreme hot and cold weather in their
transmission assessments. In particular, Reliability Standard TPL-001-
5.1 requires steady state and stability analyses to be performed for
certain extreme events but does not require steady state and stability
analyses for extreme heat and cold conditions.\48\ Likewise, while
Reliability Standard TPL-001-5.1 Table 1, provisions 2.f (stability)
and 3.b (steady state), requires responsible entities to study events
based on operating experience that may result in a wide-area
disturbance,\49\ the Standard does not specify the study of extreme
heat or cold conditions.
---------------------------------------------------------------------------

    \48\ See Reliability Standard TPL-001-5.1, at Requirements R3
and R4 and Table 1.
    \49\ Id. at Table 1, provisions 2.f and 3.b.
---------------------------------------------------------------------------

    24. System planning measures alone will not eliminate the
reliability risk associated with extreme heat and cold events. The
directives to improve transmission planning discussed in this final
rule will prepare the Bulk-Power System for extreme weather events in
the long term and will work together with the requirements in the Cold
Weather Reliability Standards to mitigate the near-term reliability
impact of extreme weather events. Improved system planning will limit
the impact of such events and reduce the risk to the reliability of the
Bulk-Power System, which prior events demonstrate is significant.

IV. Discussion

A. Directive to NERC To Develop New or Modified Reliability Standard

    25. Pursuant to FPA section 215(d)(5), we adopt the NOPR proposal
and direct NERC to submit a new Reliability Standard or modifications
to Reliability Standard TPL-001-5.1 requiring transmission system
planning for extreme heat and cold weather events that impact the
Reliable Operation of the Bulk-Power System. For the reasons discussed
in section III above, we conclude that it is necessary to update the
transmission planning Reliability Standard to reflect the impact of
extreme heat and cold weather events on the reliability of the Bulk-
Power System. Most commenters support the NOPR proposal to develop
mandatory transmission system planning requirements for extreme heat
and cold weather events.\50\ Commenters also agree that Commission
action is necessary to address the reliability gaps pertaining to the
consideration of extreme heat and cold weather events that exist in
current transmission planning processes.\51\
---------------------------------------------------------------------------

    \50\ See, e.g., MISO Transmission Owners Comments at 1-2;
Indicated Trade Associations Comments at 1-2; NYISO Comments at 1-2;
AEP Comments at 1; ACP Comments at 1; PIOs Comments at 1.
    \51\ See, e.g., EPRI Comments at P 4.
---------------------------------------------------------------------------

    26. Although supportive of the need to consider extreme weather in
the transmission planning process, PJM Interconnection, L.L.C. (PJM) is
critical of the Commission's proposed ``piecemeal'' approach and
suggests that the Commission harmonize this rulemaking with other
Commission actions on transmission planning.\52\ While we agree that it
is important for NERC and applicable planning entities to consider how
requirements implemented pursuant to this rulemaking may interact with
processes carried out pursuant to other Commission actions on
transmission planning, we disagree with PJM's suggestion that this
proceeding is not an appropriate forum for directing changes to the
NERC Reliability Standards. While there is undoubtedly a nexus between
the long-term planning for expected changes in resources and demand as
contemplated in Docket No. RM21-17-000 and Reliability Standards for
extreme weather, each set of reforms is subject to differing statutory
schemes and other considerations, and each aims at related but distinct
challenges. The Commission's transmission planning reform efforts
require individual consideration, as they each concern different
transmission planning objectives, time horizons, and areas of
Commission jurisdiction. This proceeding is conducted pursuant to the
Commission's jurisdiction under section 215 of the FPA and contemplates
transmission planning entity actions that may be needed in the planning
timeframe of six to ten years and beyond to mitigate the impacts of
extreme weather, whereas the proceeding in Docket No. RM21-17-000 was
initiated

pursuant to the Commission's jurisdiction under section 206 of the FPA,
considers a more fulsome range of practices that may be required to
render rates just and reasonable, and contemplates a planning horizon
of 20 years.\53\ While addressing these related efforts in a single
proceeding may have benefits, it also would risk complicating the
development of solutions and making the process more unwieldy. The
Commission has thus determined to take this step to facilitate
solutions to one aspect of the extreme weather challenge, as part of a
series of actions that build on each other by seeking to address the
many areas that affect extreme weather reliability.
---------------------------------------------------------------------------

    \52\ PJM Comments at 3-4, 7.
    \53\ See Building for the Future Through Elec. Reg'l
Transmission Planning & Cost Allocation & Generator Interconnection,
Notice of Proposed Rulemaking, 87 FR 26504, (May 4, 2022), 179 FERC
] 61,028 (2022).
---------------------------------------------------------------------------

    27. Accordingly, we adopt the NOPR proposal and direct NERC to
develop a new or modified Reliability Standard to require the
following: (1) development of benchmark planning cases based on major
prior extreme heat and cold weather events and/or meteorological
projections; (2) planning for extreme heat and cold weather events
using steady state and transient stability analyses expanded to cover a
range of extreme weather scenarios including the expected resource
mix's availability during extreme heat and cold weather conditions, and
including the wide-area impacts of extreme heat and cold weather; and
(3) development of corrective action plans that mitigate specified
instances where performance requirements for extreme heat and cold
weather events are not met.\54\ We also direct NERC to identify the
responsible entities for developing benchmark planning cases and
conducting wide-area studies under the new or modified Reliability
Standard.
---------------------------------------------------------------------------

    \54\ NOPR, 179 FERC ] 61,195 at P 51.
---------------------------------------------------------------------------

    28. Given the importance of timely addressing the identified
reliability gap, we direct NERC to submit the responsive new or
modified Reliability Standard within 18 months of the date of
publication of this final rule in the Federal Register. We further
direct NERC to develop a phased-in implementation timeline for the
different requirements of the new or modified Reliability Standard
(i.e., developing benchmark planning cases, conducting studies,
developing corrective action plans) that shall begin within 12 months
of the effective date of a Commission order approving the proposed
Reliability Standard.
    29. We address below in further detail issues raised in the NOPR
and in comments regarding: (1) development of benchmark events and
planning cases; (2) definition of ``wide-area;'' (3) entities
responsible for developing benchmark events and conducting transmission
planning studies of wide-area events; (4) coordination among registered
entities and sharing of data and study results; (5) concurrent/
correlated generator and transmission outages; (6) conducting
transmission system planning studies for extreme heat and cold weather
events; (7) corrective action plans; (8) other extreme weather events;
and (9) Reliability Standard development and implementation timeline.

B. Develop Benchmark Events and Planning Cases Based on Major Prior
Extreme Heat and Cold Weather Events and/or Meteorological Projections

    30. In the NOPR, the Commission proposed to direct NERC to include
in the new or modified Reliability Standard benchmark events that
responsible entities must study.\55\ The NOPR proposed basing such
benchmark events on prior events (e.g., the February 2011 Southwest
Cold Weather Event and the January 2014 Polar Vortex Cold Weather
Event) and/or meteorological projections. Recognizing that extreme
weather risks may vary from region to region and change over time, the
NOPR proposed to direct NERC to consider approaches that would provide
a uniform framework for developing benchmark events while still
recognizing regional differences; for example, NERC could define
benchmark events around a projected frequency (e.g., 1-in-50-year
event) or probability distribution (95th percentile event).\56\
Although the NOPR did not specify how these benchmark events should be
developed, the NOPR provided two examples: (1) NERC could develop the
benchmark event or events during the standard development process; or
(2) NERC could include in the new or modified Reliability Standard a
framework establishing a common design basis for the development of
benchmark events. The NOPR also suggested including in the modified
standard the primary features of the benchmark event(s) while
designating NERC or another entity to periodically update benchmark
events.\57\
---------------------------------------------------------------------------

    \55\ Id.
    \56\ Id. P 52.
    \57\ Id. P 53.
---------------------------------------------------------------------------

    31. The NOPR also proposed that establishing one or more benchmark
planning cases, based on benchmark events, should form the basis for
sensitivity analysis. In addition to providing valuable case study
information to be applied to preparing for possible comparable future
events, these events would also serve as a basis for effectively using
assets and resources. Specifically, once developed, responsible
entities would use the benchmark events to develop benchmark planning
cases to conduct studies to assess the limitations of the transmission
system locally and over a wide-area, and to understand resource
availability and potential firm load shedding requirements under
stressed conditions.\58\ The NOPR sought comments on all aspects of the
proposed directive.
---------------------------------------------------------------------------

    \58\ Id.
---------------------------------------------------------------------------

1. Comments
    32. Commenters generally agree with the NOPR proposal to direct
NERC to develop requirements that address the types of extreme heat and
cold weather scenarios that responsible entities are required to
study.\59\ Indicated Trade Associations caution, however, that
universal benchmark events would be hard to implement given regional
differences.\60\ As such, and consistent with the NOPR proposal,
Indicated Trade Associations, APS, Bonneville Power Administration
(BPA), and Idaho Power, among others, agree that regional differences
(e.g., climate, topology, electrical characteristics) should be
considered in developing benchmark events.\61\
---------------------------------------------------------------------------

    \59\ See, e.g., NERC Comments at 7-8; AEP Comments at 7;
Indicated Trade Associations Comments at 8; NARUC Comments at 5.
    \60\ Indicated Trade Associations Comments at 8.
    \61\ See id.; APS Comments at 3; BPA Comments at 3; Idaho
Comments at 2.
---------------------------------------------------------------------------

    33. Regarding how benchmark events should be developed, NERC notes
that significant work will be necessary to develop a uniform planning
approach that properly accounts for regional differences in climate and
weather patterns, among other considerations. Accordingly, NERC asks
for flexibility in developing benchmark events, including considering
options beyond those identified in the NOPR.\62\ Indicated Trade
Associations recommend that NERC consider all the examples of benchmark
events identified in the NOPR.\63\ PJM indicates that developing
benchmark events will require scientific and meteorological expertise
to ensure that NERC guidelines and criteria reflect statistically valid
scenarios for the meteorological projections and their possible impacts
on transmission planning. As such, PJM recommends that the Commission
engage the national

labs, Regional Transmission Organizations (RTO), NOAA, and other
agencies to develop extreme weather ``design threshold'' metrics, as
well as investigate targeted planning thresholds (e.g., 1-in-50-year
events).\64\ Other commenters highlight the necessity of ensuring that
benchmark events are not only developed using historical extreme heat
and cold event data, but more importantly use future meteorological
projections in order to prepare for plausible extremes in future
years.\65\
---------------------------------------------------------------------------

    \62\ NERC Comments at 8-9.
    \63\ Indicated Trade Associations Comments at 8.
    \64\ PJM Comments at 9.
    \65\ See, e.g., EPRI Comments at P 5; Entergy Comments at 3.
---------------------------------------------------------------------------

    34. All those who submitted comments regarding the NOPR proposal to
require periodic updates to benchmark events agree with the need to do
so. For example, Union for Concerned Scientists (UCS) points to the
scientific consensus that climate change is altering the intensity and
frequency of extreme weather conditions as a reason to require the
periodic update of benchmark events.\66\ American Electric Power
Service Corporation (AEP) recommends updating the benchmark events
every three years, consistent with the Commission's proposed planning
cycle for regional transmission planning, based on the most up-to-date
data.\67\ In contrast, Midcontinent Independent System Operator, Inc.
(MISO) suggests that, consistent with similar requirements in
Reliability Standard TPL-007-4 (Transmission System Planned Performance
for Geomagnetic Disturbance Events) and Reliability Standard PRC-006-5
(Automatic Underfrequency Load Shedding) extreme heat and cold weather
benchmark events should be updated every five years.\68\ Other
commenters recommend that the key aspects of the benchmark be updated
periodically, without opining on the periodicity of updates.\69\
---------------------------------------------------------------------------

    \66\ UCS Comments at 7.
    \67\ AEP Comments at 3-4 (citing Docket No. RM21-17-000).
    \68\ MISO Comments at 3.
    \69\ See, e.g., APS Comments at 3; Entergy Comments at 4;
Indicated Trade Associations Comments at 8.
---------------------------------------------------------------------------

2. Commission Determination
    35. Pursuant to section 215(d)(5) of the FPA, we adopt the NOPR
proposal and direct NERC to: (1) develop extreme heat and cold weather
benchmark events, and (2) require the development of benchmark planning
cases based on identified benchmark events. Without specific
requirements describing the types of heat and cold scenarios that
responsible entities must study, the new or modified Reliability
Standard may not provide a significant improvement upon the status quo.
Benchmark events will provide a defined event that will form the basis
for assessing system performance during extreme heat and cold weather
events. Benchmark events will also form the basis for a planner's
benchmark planning case--i.e., the base case representing system
conditions under the relevant benchmark event--that will be used to
study the potential wide-area impacts of anticipated extreme heat and
cold weather events.
    36. Although the NOPR outlined some of the Commission's
expectations for the development of benchmark events, including that
benchmark events be based on prior extreme heat and cold events and/or
meteorological projections,\70\ there is currently no established
guidance or set of tools in place to facilitate the development of
extreme heat and cold benchmark events for the purpose of informing
transmission system planning. As recommended by commenters, NERC should
consider the examples of approaches for defining benchmark events
identified in the NOPR (e.g., the use of projected frequency or
probability distribution).\71\ NERC may also consider other approaches
that achieve the objectives outlined in this final rule. Further, as
recommended by PJM, we believe there is value in engaging with national
labs, RTOs, NOAA, and other agencies and organizations in developing
benchmark events. Considering NERC's key role, technical expertise, and
experience assessing the reliability impacts of various events and
conditions, we encourage NERC to engage with national labs, RTOs, NOAA,
and other agencies and organizations as needed. To that end, as
discussed in section IV.J below, we have modified the NOPR proposal to
allow more time for NERC to consider these complex issues and engage
additional expertise where necessary.
---------------------------------------------------------------------------

    \70\ For instance, a benchmark event could be constructed based
on data from a major prior extreme heat or cold event, with
adjustments if necessary to account for the fact that future
meteorological projections may estimate that similar events in the
future are likely to be more extreme.
    \71\ See supra P 33.
---------------------------------------------------------------------------

    37. Because the impact of most extreme heat and cold events spans
beyond the footprints of individual planning entities, it is important
that all responsible entities likely to be impacted by the same extreme
weather events use consistent benchmark events. Doing so is important
to ensuring that neighboring planning regions are assuming similar
weather conditions and are able to coordinate their assumptions
accordingly. As a result, defining the benchmark event in a manner that
provides responsible entities significant discretion to determine the
applicable meteorological conditions would not meet the objectives of
this final rule.
    38. At the same time, because different regions experience weather
conditions and their impacts differently, a single benchmark event for
the entire Nation is unlikely to meet the objectives of this final
rule. Accordingly, in developing extreme heat and cold benchmark
events, NERC shall ensure that benchmark events reflect regional
differences in climate and weather patterns.
    39. We also direct NERC to include in the Reliability Standard the
framework and criteria that responsible entities shall use to develop
from the relevant benchmark event planning cases to represent potential
weather-related contingencies (e.g., concurrent/correlated generation
and transmission outages, derates) and expected future conditions of
the system such as changes in load, transfers, and generation resource
mix, and impacts on generators sensitive to extreme heat or cold, due
to the weather conditions indicated in the benchmark events. Developing
such a framework would provide a common design basis for responsible
entities to follow when creating benchmark planning cases. This would
not only help establish a clear set of expectations for responsible
entities to follow when developing benchmark planning events, but also
facilitate auditing and enforcement of the Standard.
    40. We also direct NERC to ensure the reliability standard contains
appropriate mechanisms for ensuring the benchmark event reflects up-to-
date meteorological data. The increasing intensity, frequency, and
unpredictability of extreme weather conditions requires that key
aspects of the benchmark events be reviewed, and if necessary, updated
periodically to ensure the corresponding benchmark planning cases
reflect updated meteorological data. For example, a requirement that
defines a fixed benchmark event with no provision for future updates
(e.g., defining the benchmark event for a responsible entity as the
most severe heat wave in the last twenty years measured from the
effective date of the standard) may not provide an accurate indicator
of future risks. To the extent NERC determines that the benchmark event
should be fixed or only updated

periodically,\72\ we agree with MISO that including a mechanism to
update the benchmark event at least every five years would strike a
reasonable balance between the benefits of using the most up-to-date
meteorological data and administrative the burdens of collecting and
analyzing such data.
---------------------------------------------------------------------------

    \72\ See, e.g., Reliability Standard EOP-012-1 (Extreme Cold
Weather Preparedness and Operations), at Requirement 4 (requiring
generator owners to calculate the generator extreme cold weather
temperature every five years).
---------------------------------------------------------------------------

C. Definition of ``Wide-Area''

    41. In the NOPR, the Commission proposed to direct NERC to require
in a new or modified Reliability Standard that transmission planning
studies consider the wide-area impacts of extreme heat and cold
weather.\73\ The NOPR explained that the impacts of extreme weather
events on the Reliable Operation of the Bulk-Power System can be
widespread, potentially causing simultaneous loss of generation and
increased transmission constraints within and across regions.\74\ The
NOPR also pointed out that failure to study the wide-area impact of
extreme heat or cold weather conditions in transmission planning could
result in reliability issues affecting multiple regions or multiple
planning coordinator areas remaining undetected in the long-term
planning horizon. This, in turn, could lead to otherwise avoidable
system conditions that would be only one contingency away from voltage
collapse and uncontrolled blackouts.\75\
---------------------------------------------------------------------------

    \73\ NOPR, 179 FERC ] 61,195 at P 64.
    \74\ Id.
    \75\ Id. P 66.
---------------------------------------------------------------------------

    42. The NOPR proposed that, based on prior events, the study
criteria for extreme heat and cold weather events should consider wide-
area conditions affecting neighboring regions and their impact on one
planning area's ability to rely on the resources of another region
during the weather event.
    43. To identify opportunities for improved wide-area planning
studies and coordination, the NOPR sought comments on whether wide-area
planning studies should be defined geographically or electrically.\76\
---------------------------------------------------------------------------

    \76\ Id. P 67. The NOPR also solicited comment on which entities
should oversee and coordinate the wide-area planning models and
studies, as well as addressing the results of the studies, and how
they should communicate those results among transmission planners.
Id. These comments are addressed below in the sections D and E.
---------------------------------------------------------------------------

1. Comments
    44. AEP, MISO Transmission Owners, and Tri-State Generation and
Transmission Association, Inc. (Tri-State) favor defining wide-area
geographically.\77\ MISO Transmission Owners assert that wide-area must
be defined by geography to address issues in each region as best suited
for that region, given that extreme heat and cold weather risks, and
the appropriate responses thereto, vary by geography.\78\ Tri-State
explains that ``wide-area'' should be defined geographically, because
for a transmission planner to evaluate a large area weather event, it
would need to be modeled within the transmission planner's area, as
well as neighboring entities.\79\
---------------------------------------------------------------------------

    \77\ AEP Comments at 16; MISO Transmission Owners Comments at 4.
    \78\ Id. at 4.
    \79\ Tri-State Comments at 5-6.
---------------------------------------------------------------------------

    45. Although MISO Transmission Owners support a geographic
definition, they also caution that RTO regions, Order No. 1000 planning
regions, and NERC Regional Entities do not have identical footprints.
Therefore, MISO Transmission Owners recommend that the final rule
direct NERC to propose modifications to Reliability Standards to
provide appropriately flexible provisions to address scenarios where
those inconsistent footprints may introduce conflicts.\80\
---------------------------------------------------------------------------

    \80\ MISO Transmission Owners Comments at 4.
---------------------------------------------------------------------------

    46. Idaho Power, on the other hand, comments that ``wide-area''
should be defined electrically to better capture the interdependency of
systems.\81\
---------------------------------------------------------------------------

    \81\ Idaho Power Comments at 4.
---------------------------------------------------------------------------

    47. LCRA Transmission Services Corporation (LCRA), Electric Power
Research Institute (EPRI), and PJM prefer that ``wide-area'' be defined
both geographically and electrically. LCRA explains that this is
necessary to represent the geographic correlation of extreme weather
events and the electrical connectivity of the transmission system.\82\
EPRI cautions that ``geographic definitions of wide area events will
need to be developed for inclusion in resource adequacy or production
cost models'' for purposes of identifying the snapshot conditions that
should serve as the primary inputs to the transmission planning
assessments.\83\ Further, EPRI explains that ``wide area events defined
electrically can be used to represent acute switching events that occur
over much shorter timescales and can be used to capture discrete
impacts defined as contingency events, which occur concurrent with the
extreme temperature condition.'' \84\
---------------------------------------------------------------------------

    \82\ LCRA Comments at 3; EPRI Comments at P 18; PJM Comments at
10.
    \83\ EPRI Comments at P 18.
    \84\ Id. at 12.
---------------------------------------------------------------------------

    48. Other commenters, while not indicating a preference between
electrical or geographical definition, highlight that extreme heat and
cold weather events are not bound by the footprint of utilities or
authorities that separate planning and balancing areas.\85\ Indicated
Trade Associations recommend that the Commission invest the NERC
standard drafting team with substantial discretion in addressing
whether and how wide-area planning studies should be defined
geographically or electrically.\86\
---------------------------------------------------------------------------

    \85\ UCS Comments at 8; Entergy Comments at 5; EDF at Comments
23; MISO Transmission Owners Comments at 4.
    \86\ Indicated Trade Associations at 10.
---------------------------------------------------------------------------

    49. Although also not stating a preference as to whether to define
``wide-area'' electrically or geographically, Entergy Services, LLC
(Entergy) cautions against expecting transmission planners and
coordinators ``to overlap benchmark events between regions'' because
``[s]uch overlapping could result in modeling of extreme heat and cold
events over regions that are much larger than the areas in which such
events are likely to occur.'' \87\
---------------------------------------------------------------------------

    \87\ Entergy Comments at 5-6.
---------------------------------------------------------------------------

2. Commission Determination
    50. Pursuant to section 215(d)(5) of the FPA, we adopt the NOPR
proposal and direct NERC to require that transmission planning studies
under the new or revised Reliability Standard consider the wide-area
impacts of extreme heat and cold weather. We direct NERC to clearly
describe the process that an entity must use to define the wide-area
boundaries. While commenters provide various views in favor of both a
geographical approach and electrical approach to defining wide-area
boundaries, we do not adopt any one approach in this final rule.
Rather, we believe that this technical matter deserves a more fulsome
vetting in the Reliability Standards development process. NERC should
consider the comments in this proceeding when developing a new or
modified reliability standard that considers the broad area impacts of
extreme heat and cold weather.\88\
---------------------------------------------------------------------------

    \88\ Cf., Order No. 693, 118 FERC ] 61,218 at P 188 (directing
NERC to address NOPR comments suggesting specific new improvements
to the Reliability Standards in the standards development process,
noting that it ``does not direct any outcome other than that the
comments receive consideration.'').
---------------------------------------------------------------------------

D. Entities Responsible for Developing Benchmark Events and Planning
Cases, and for Conducting Transmission Planning Studies of Wide-Area
Events

    51. The NOPR proposed to direct NERC to develop requirements that
address the types of extreme heat and

cold scenarios responsible entities are required to study, including
the development of benchmark events and benchmark planning cases.\89\
The NOPR solicited feedback on which entities should be responsible for
updating benchmark events and whether, and to what extent, it may be
appropriate to allow designated entities to periodically update key
aspects of the benchmark events.\90\
---------------------------------------------------------------------------

    \89\ NOPR, 179 FERC ] 61,195 at PP 50-51.
    \90\ Id. P 53.
---------------------------------------------------------------------------

    52. As a separate matter, the NOPR proposed to require that
transmission planning studies that consider the wide-area impacts of
extreme heat and cold weather.\91\ To inform this directive, the NOPR
solicited comment on which entities should oversee and coordinate the
wide-area planning models and studies, as well as which entities should
have responsibility to address the results of the studies.\92\
---------------------------------------------------------------------------

    \91\ Id. P 64.
    \92\ Id. P 67.
---------------------------------------------------------------------------

1. Comments
a. Entity Responsible for Development of Benchmark Events
    53. There is no consensus among the commenters regarding which
entities should be tasked with developing the benchmark events.
Indicated Trade Associations suggest that the subject matter experts on
the NERC standard drafting team should develop the benchmark
events.\93\ Entergy also suggests that the NERC develop the benchmark
events, as NERC will be able to tailor the benchmark events to reflect
regional variations in extreme weather risk.\94\ All other commenters
on this issue proposed that other entities be responsible for benchmark
event development.\95\ For example, New York Independent System
Operator, Inc. (NYISO) and MISO Transmission Owners posit that entities
registered with NERC as planning coordinators or transmission planners
should be given the latitude to develop the benchmark events.\96\ AEP
recommends that each planning coordinator should develop individualized
benchmark events for its planning area, except in regions that lack the
necessary resources or expertise, in which case the Regional Entities
should coordinate and review the benchmark event process in
collaboration with these smaller planning coordinators in that
region.\97\ American Clean Power Association (ACP) suggests that the
Regional Entities should develop the benchmark events that will be
evaluated by all transmission planners and planning coordinators in a
given region.\98\
---------------------------------------------------------------------------

    \93\ Indicated Trade Associations Comments at 8.
    \94\ Entergy Comments at 4.
    \95\ See. e.g., EDF Comments at 8.
    \96\ NYISO Comments at 13; MISO Transmission Owners Comments at
5.
    \97\ AEP Comments at 9.
    \98\ ACP Comments at 3.
---------------------------------------------------------------------------

b. Entity Responsible for Development of Planning Cases and Conducting
Transmission Planning Studies of Wide-Area Events
    54. Regarding development of benchmark planning cases, beyond
existing registered entities, Arizona Public Service Company (APS)
recommends ``that a regional planning entity would be the appropriate
entity to determine the benchmark planning cases and develop the
scenarios that constitute an extreme event in their region.'' \99\
---------------------------------------------------------------------------

    \99\ APS Comments at 3.
---------------------------------------------------------------------------

    55. Further, commenters suggest a variety of entities to perform
the wide area studies. NERC suggests that a registered entity subject
to the Reliability Standard, such as a planning coordinator or
transmission planner, should be responsible for performing the wide-
area studies.\100\ AEP asserts that the planning coordinators should
oversee and coordinate the wide-area planning models and studies,
communicate the results, and work to mitigate issues that require
corrective action.\101\
---------------------------------------------------------------------------

    \100\ AEP Comments at 20; NERC Comments at 9-10.
    \101\ AEP Comments at 16.
---------------------------------------------------------------------------

    56. APS and MISO Transmission Owners express concern that an
individual transmission planner or planning coordinator would not be
positioned to perform a wide-area assessment of extreme weather
conditions because of its limited geographical visibility.\102\
Similarly, Entergy also questions whether a single transmission planner
would be able to model a wide-area event on its own. Entergy believes
that the responsibility for performing the analysis should lie with the
RTOs or Regional Entities, with input provided by member transmission
owners and transmission planners.\103\ Alternatively, APS suggested a
regional planning entity, such as those created under Order No. 1000,
would be appropriate to oversee and coordinate wide-area planning
models and studies.\104\ Idaho Power Company (Idaho Power) asserts that
regional planning groups such as Western Power Pool are the ones best
positioned to coordinate and perform the wide-area planning
studies.\105\
---------------------------------------------------------------------------

    \102\ APS Comments at 4; MISO Transmission Owners Comments at 4.
    \103\ Entergy Comments at 6.
    \104\ APS Comments at 4.
    \105\ Idaho Power Comments at 4.
---------------------------------------------------------------------------

    57. Environmental Defense Fund (EDF), Tri-State, and Eversource
Energy Service Company (Eversource) propose that reliability
coordinators should have the responsibility to perform wide-area
planning and coordination in collaboration with other impacted
reliability coordinators.\106\
---------------------------------------------------------------------------

    \106\ EDF Comments at 23; Tri-State Comments at 6; Eversource
Comments at 5.
---------------------------------------------------------------------------

2. Commission Determination
a. Entity Responsible for Establishing Benchmark Events
    58. Pursuant to section 215(d)(5) of the FPA, we adopt the NOPR
proposal and direct NERC to develop benchmark events for extreme heat
and cold weather events through the Reliability Standards development
process. We agree with Indicated Trade Associations that the
development of adequate benchmark events is critical and should be
committed to the subject matter experts on the standards drafting team.
We also agree with Entergy that NERC will be able to tailor benchmark
events to capture regional differences and the different risks that
each region faces during extreme heat and cold weather events. While
Regional Entities and reliability coordinators are encouraged to
participate in the NERC Reliability Standards development process to
develop the benchmark events, we disagree with AEP and other commenters
who recommend that entities other than NERC take the lead in the
development of benchmark events.
    59. Further, requiring NERC to develop the new or modified
Reliability Standard's benchmark events is consistent with the approach
the Commission took in Order No. 779, when the Commission directed NERC
to develop benchmark events for geomagnetic disturbance analyses.\107\
For the same reasons, we also conclude that NERC is best positioned to
define mechanisms to periodically update extreme heat and cold weather
benchmark events, as discussed above.\108\
---------------------------------------------------------------------------

    \107\ Reliability Standards for Geomagnetic Disturbances, Order
No. 779, 143 FERC ] 61,147, at P 2 (2013).
    \108\ See supra P 40.
---------------------------------------------------------------------------

b. Entities Responsible for Development of Planning Cases and
Conducting Transmission Planning Studies of Wide-Area Events
    60. We also direct NERC to designate the type(s) of entities
responsible for

developing benchmark planning cases and conducting wide-area studies
under the new or modified Reliability Standard. The scope of extreme
weather event studies will likely cover large geographical areas far
exceeding the smaller individual transmission planner or planning
coordinator planning areas. Accordingly, we agree with APS that the
benchmark planning cases should be developed by registered entities
such as large planning coordinators, or groups of planning
coordinators, with the capability of planning on a regional scope.\109\
---------------------------------------------------------------------------

    \109\ According to the NERC Registration Matrix, there are
currently 211 transmission planners and 66 planning coordinators in
the United States. While some of these entities operate over large
geographic areas--for example, PJM and MISO are the only planning
coordinators in the Reliability First footprint--the majority
operate on a much smaller scale--WECC and SERC have 59 planning
coordinators, some of which are small cities and counties. NERC, NCR
Active Entities List, (last visited Apr. 7, 2023) https://www.nerc.com/pa/comp/Registration%20and%20Certification%20DL/NERC_Compliance_Registry_Matrix_Excel.xlsx.
---------------------------------------------------------------------------

    61. We also disagree with assertions that reliability coordinators
should be responsible for developing benchmark planning cases or
conducting wide-area studies. We believe the designated responsible
entities should have certain characteristics, including having a wide-
area view of the Bulk-Power System and the ability to conduct long-term
planning studies across a wide geographic area. The responsible
entities should also have the planning tools, expertise, processes, and
procedures to develop benchmark planning cases and analyze extreme
weather events in the long-term planning horizon. Under the NERC
functional model, however, reliability coordinators have responsibility
for the real-time operation of the bulk-power system. Accordingly, we
conclude that reliability coordinators are not well suited for
developing benchmark planning cases or conducting wide-area studies.
    62. To comply with this directive, NERC may designate the tasks of
developing benchmark planning cases and conducting wide-area studies to
an existing functional entity or a group of functional entities (e.g.,
a group of planning coordinators). NERC may also establish a new
functional entity registration to undertake these tasks. In the
petition accompanying the proposed Reliability Standard NERC should
explain how the applicable registered entity or entities meet the
objectives outlined above.

E. Coordination Among Registered Entities and Sharing of Data and Study
Results

    63. The NOPR explained that Reliability Standard TPL-001-5.1 cross-
references Reliability Standard MOD-032-1 (Data for Power System
Modeling Analysis), which establishes consistent modeling data
requirements and reporting procedures for the development of planning
horizon cases necessary to support analysis of the reliability of the
interconnected system.\110\ Reliability Standard MOD-032-1 ensures an
adequate means of data collection for transmission planning. It
requires applicable registered entities to provide steady-state,
dynamic, and short circuit modeling data to their transmission
planner(s) and planning coordinator(s). The modeling data is then
shared pursuant to the data requirements and reporting procedures
developed by the transmission planner and planning coordinator as set
forth in Reliability Standard TPL-001-5.1, Requirement R1.
---------------------------------------------------------------------------

    \110\ NOPR, 179 FERC ] 61,195 at P 80.
---------------------------------------------------------------------------

    64. The NOPR stated that, while balancing authorities and other
entities must share system information and study results with their
transmission planner and planning coordinator pursuant to Reliability
Standards MOD-032-1 and TPL-001-5.1, there is no required sharing of
such information related to extreme heat or cold weather events--or
required coordination--among planning coordinators and transmission
planners with transmission operators, transmission owners, and
generator owners.\111\ Sharing system information and study results and
enhancing coordination among these entities for extreme heat and cold
weather events could result in more representative planning models by
better integrating and including operations concerns (e.g., lessons
learned from past issues including corrective actions and projected
outcomes from these actions, evolving issues concerning extreme heat/
cold) in planning models; and conveying reliability concerns from
planning studies (e.g., potential widespread cascading, islanding,
significant loss of load, blackout, etc.) as they pertain to extreme
heat or cold.\112\
---------------------------------------------------------------------------

    \111\ Id. P 81.
    \112\ Id.
---------------------------------------------------------------------------

    65. The NOPR proposed to direct NERC to require system information
and study results sharing and coordination among planning coordinators
and transmission planners with transmission operators, transmission
owners, and generator owners for extreme heat and cold weather
events.\113\ The NOPR solicited comments on whether existing
Reliability Standards are sufficient to ensure that responsible
entities performing studies of extreme heat and cold weather events
have the necessary data, and/or whether the Commission should direct
additional changes pursuant to FPA section 215(d)(5) to address the
issue.\114\ The NOPR also sought comments on the following: (1) the
parameters and timing of coordination and sharing; (2) specific
protocols that may need to be established for efficient coordination
practices; and (3) potential impediments to the proposed coordination
efforts.
---------------------------------------------------------------------------

    \113\ Id. P 82.
    \114\ Id. P 63.
---------------------------------------------------------------------------

1. Comments
    66. There is no consensus among commenters on whether Reliability
Standards TPL-001.5.1 and MOD-032-1 are adequate means of data
collection for transmission planning, with some commenters raising
concerns about the types of data that will be needed to conduct extreme
heat and cold weather studies under the new or modified Reliability
Standard and whether such data can be obtained through existing
processes.
    67. For example, NERC and Idaho Power believes that the existing
standards are sufficient.\115\ According to NERC, the Commission does
not need to direct revisions to Reliability Standard MOD-032-1 to
account for new data required for extreme heat and cold weather studies
because the standard requires functional entities to provide ``other
information requested by the Planning Coordinator or Transmission
Planner necessary for modeling purposes'' for each of the three types
of data required (steady-state, dynamics, and short circuit).\116\
Thus, NERC asserts that planning coordinators and transmission planners
are empowered to request any specific data needed for studies of
extreme heat and cold conditions. According to Idaho Power, because (1)
utilities currently share contingencies to be studied with neighboring
entities to get feedback and make updates as needed and (2) utilities
share TPL-001 reports with other utilities subject to the execution of
a non-disclosure agreement, the Commission proposal would be redundant
of current practice.\117\
---------------------------------------------------------------------------

    \115\ NERC Comments at 13; Idaho Power Comments at 5.
    \116\ NERC Comments at 13.
    \117\ Idaho Power Comments at 5.

---------------------------------------------------------------------------

    68. In contrast, Tri-State indicates that there is no requirement
for transmission customers to provide data for extreme heat and cold
weather conditions such as load forecast data.\118\ AEP asserts that
planning coordinators and transmission planners have limited insight
into a generator's likelihood of availability during extreme weather
events, particularly limited for inverter-based resources.\119\ EPRI
states that there is limited modeling of protection systems in dynamic
assessments currently, and any dynamic simulation of extreme events
would require significant modeling of protection systems to provide for
convergence of the numerical simulation.\120\ NYISO notes that
Reliability Standard TPL-001 currently limits transmission planners or
planning coordinators to requesting data pertaining to their own
planning area.\121\
---------------------------------------------------------------------------

    \118\ Tri-State Comments at 4-5.
    \119\ AEP Comments at 15.
    \120\ EPRI Comments at P 11.
    \121\ NYISO Comments at 14.
---------------------------------------------------------------------------

    69. Other commenters suggest that it will be necessary to define
the data needed by responsible entities to perform studies under the
new or modified Reliability Standard. AEP proposes that the Commission
hold a technical conference to help define the data needed to perform
the extreme weather assessments and the avenue through which
information will be shared.\122\ Indicated Trade Associations recommend
that, although Reliability Standard MOD-032-1 might be adequate as a
data source, the Commission should recognize in any final rule that the
standard drafting team should be tasked with identifying what data is
already collected and specifying what new data is needed to perform the
assessments for extreme heat and cold.\123\
---------------------------------------------------------------------------

    \122\ AEP Comments at 4.
    \123\ Indicated Trade Associations Comments at 9-10.
---------------------------------------------------------------------------

    70. Regarding the sharing of study results and coordination among
entities, Tri-State suggests that the balancing authority should
address the results of the studies and how they should communicate
those results among the transmission planners. Tri-State also asserts
that the balancing authority is responsible for resource adequacy and
should communicate resource needs for the area with the responsible
transmission planners who can evaluate system needs and ``provide
access to remove'' resource needs.\124\ EPRI does not opine on who
should do the wide-area coordination, but states that some level of
coordination will be required to ensure accurate assessments of wide
area events that impact geographic footprints across multiple planning
entities.\125\ UCS suggests that the final rule should direct the
sharing of modeling information between planning areas regarding
extreme weather benchmark events, because ensuring reliability will
depend on the extent to which neighboring regions cooperate.\126\
---------------------------------------------------------------------------

    \124\ Tri-State Comments at 6.
    \125\ EPRI Comments at P 19.
    \126\ UCS Comments at 8.
---------------------------------------------------------------------------

    71. NERC asserts that while wide-area studies should be coordinated
as appropriate for the area, the specific procedural details for
coordination on wide-area studies do not need to be mandated in a
Reliability Standard. NERC adds that other coordination requirements,
such as those related to sharing of study results and coordination for
corrective actions across multiple transmission planner areas, can be
addressed through the standard development process with consideration
of any factors identified by the commenters in this proceeding.\127\
Similarly, Indicated Trade Associations recommend that the Commission
empower the standards drafting team to consider whether coordination
between a variety of functional entities, and across regions, would be
the most effective means of addressing certain identified extreme heat
and cold weather events.\128\
---------------------------------------------------------------------------

    \127\ NERC Comments at 10.
    \128\ Indicated Trade Associations Comments at 5.
---------------------------------------------------------------------------

2. Commission Determination
    72. Pursuant to section 215(d)(5) of the FPA, we adopt and modify
the NOPR proposal and direct NERC to require functional entities to
share with the entities responsible for developing benchmark planning
cases and conducting wide-area studies the system information necessary
to develop benchmark planning cases and conduct wide-area studies.
Further, responsible entities must share the study results with
affected transmission operators, transmission owners, generator owners,
and other functional entities with a reliability need for the
studies.\129\
---------------------------------------------------------------------------

    \129\ The NOPR proposed to direct NERC to ensure that functional
entities share necessary system information with planning
coordinators and transmission planners, as these entities conduct
current transmission planning studies under TPL-001-5.1. Because
this final rule directs NERC to determine the entities that will be
responsible for conducting studies under the new or modified
Reliability Standard, we modify the NOPR accordingly to ensure the
selected responsible entity has the means to request and receive
necessary system information.
---------------------------------------------------------------------------

    73. We agree with commenters that Reliability Standard MOD-032-1
allows for data collection for extreme heat and cold weather events.
However, only planning coordinators and transmission planners can
request data from other entities through Reliability Standard MOD-032-1
processes. Because in this final rule we direct NERC to determine the
responsible entities that will be developing benchmark planning cases
and conducting wide-area studies, it is possible that the selected
responsible entities under the new or modified Reliability Standard
will not be able to request and receive needed data pursuant to MOD-
032-1, absent modification to that Standard.
    74. Regarding EPRI's statement of insufficiency of dynamic modeling
of protection systems, we consider the insufficiency of protection
system modeling to be an ongoing deficiency in the modeling process.
The dynamics databases used for transient stability simulations by
various interconnections typically do not include comprehensive dynamic
models of relays installed in the interconnection. Thus, in addressing
our directive above, NERC should evaluate this deficiency during the
standard development process.
    75. We disagree with UCS's recommendation that the final rule
should direct the sharing of modeling information between planning
areas regarding extreme weather benchmark events. We expect that the
existing practice (e.g., MOD-032-1) of responsible entities sharing
modeling information between planning areas will continue, without the
need for us to specifically direct that in this final rule.
    76. Rather than predetermine each aspect of the coordination
process, we believe the decision of which entities are best positioned
for wide-area coordination should be left to NERC. We therefore direct
NERC to address the requirement for wide-area coordination through the
standard development process, giving due consideration to relevant
factors identified by commenters in this proceeding.
    77. We agree with NERC and Indicated Trade Associations that
coordination requirements, such as those related to the sharing of
study results and corrective actions across multiple transmission
planner areas, are best addressed through the standard development
process, which we expect will consider relevant factors identified by
the commenters in this proceeding. Although this final rule does not
specify how study results must be shared, we believe that the new or
modified Reliability Standard must require responsible entities to
share these studies with affected functional entities. The sharing of
study results will alert entities of reliability concerns identified

in wide-area studies.\130\ Further, requiring responsible entities to
share study results with functional entities with a reliability related
need for the study is consistent with existing planning assessment
sharing requirements under Reliability Standard TPL-001-5.1.\131\
Therefore, we direct NERC to require in the new or modified Reliability
Standard that responsible entities share the results of their wide-area
studies with other registered entities such as transmission operators,
transmission owners, and generator owners that have a reliability
related need for the studies.
---------------------------------------------------------------------------

    \130\ NOPR, 179 FERC ] 61,195 at P 81.
    \131\ See Reliability Standard TPL-001-5.1, Requirement R8.
---------------------------------------------------------------------------

F. Concurrent/Correlated Generator and Transmission Outages

    78. The NOPR stated that generation resources that are sensitive to
severe weather conditions may cease operation during extreme heat and
cold events, thus contributing to wide-area concurrent outages. In
addition, the NOPR indicated that extreme heat could lead to
significant derating, reduced lifetime, or failure of power
transformers, while extreme cold could lead to at least temporary
transmission facility outages.\132\
---------------------------------------------------------------------------

    \132\ NOPR, 179 FERC ] 61,195 at P 68.
---------------------------------------------------------------------------

    79. As such, the NOPR posited that modeling the loss of these
generators and transmission equipment during extreme heat and cold
weather events would allow planners to assess the effects of potential
concurrent transmission and generator outages and study the feasibility
(i.e., availability and deliverability) of external generation
resources that could possibly be imported to serve load during such
events, thereby minimizing the potential impact of extreme heat and
cold events on customers.\133\ In addition, the NOPR indicated that
modeling concurrent generator and transmission outages would also allow
planners to better identify appropriate solutions to be incorporated
into corrective action plans.\134\
---------------------------------------------------------------------------

    \133\ Id. P 69.
    \134\ Id.
---------------------------------------------------------------------------

    80. The NOPR also proposed that accounting for concurrent outages
including modeling the derating and possible loss of wind and solar
generators, as well as natural gas generators sensitive to extreme heat
and cold conditions in planning studies would provide a more realistic
assessment of system conditions (i.e., updated conditions based on
historic benchmarked performance) during potential extreme heat and
cold events and will help better assess the probability of potential
occurrences of cascading outages, uncontrolled separation, or
instability. Thus, the NOPR suggested that requiring transmission
planners and planning coordinators to study concurrent generator and
transmission failures under extreme heat and cold events to account for
the expected resource mix's availability during these extreme
conditions is one way to address the reliability gap in Reliability
Standard TPL-001-5.1.\135\
---------------------------------------------------------------------------

    \135\ Id. P 72.
---------------------------------------------------------------------------

    81. To identify the scope of these planning studies, the NOPR
sought comments on the following: (1) the assumptions (e.g., weather
forecast, load forecast, transmission voltage levels, generator types,
multi-day low wind, and solar events) used in modeling of concurrent
outages due to extreme heat and cold weather events; (2) what
assumptions should be included when performing modeling and planning
for generators sensitive to extreme heat and cold; (3) how the impact
of loss of generators sensitive to extreme heat and cold should be
factored into long-term planning; (4) the extent of neighboring
systems' or planning areas' outages that should be modeled in
transmission planning studies; and (5) whether a certain threshold
penetration of wind, solar, and natural gas generation should trigger
additional analyses.\136\
---------------------------------------------------------------------------

    \136\ Id.
---------------------------------------------------------------------------

1. Comments
    82. Commenters mostly agree with the NOPR that responsible entities
should evaluate the risk of correlated or concurrent outages and
derates of all types of generation resources (i.e., conventional and
renewables) as well as transmission facilities related to extreme
weather events.\137\ For example, the Federal Energy Advocate for the
Public Utilities Commission of Ohio (Ohio FEA) recommends that the
Standard incorporate asset correlations and interdependencies, and
consider the extent to which they can be obviated or mitigated because
asset performance or failure is highly correlated with their dependency
on weather conditions and on the performance of nearby or related
infrastructure.\138\ Idaho Power notes that while Reliability Standard
TPL-001-5.1 already addresses the loss of multiple generating stations
resulting from conditions such as the loss of a large gas pipeline into
a region or multiple regions that have significant gas-fired
generation, the standard could be modified to include the impact of
renewable energy resource response due to extreme weather as well.\139\
While agreeing with the NOPR proposal, Public Interest Organizations
(PIOs) and ACP argue that any requirement to study concurrent or
correlated generation outages should be extended to conventional
generators to account for the reliability risk and to eliminate undue
discrimination caused by overstating the reliability contributions of
conventional generators relative to renewable and storage
resources.\140\
---------------------------------------------------------------------------

    \137\ EDF Comments at 22; ACP Comments at 5; PIOs Comments at 9;
AEP Comments at 4; UCS Comments at 12; and Americans for Clean
Energy Grid Comments at 6 (ACEG Comments).
    \138\ Ohio FEA Comments at 5.
    \139\ Idaho Power Comments at 4.
    \140\ PIOs Comments at 23-24.
---------------------------------------------------------------------------

    83. Some commenters assert that the NOPR proposal on modeling the
effects of potential concurrent transmission and generator outages
might be unnecessary. ISO New England Inc. (ISO-NE) takes issue with
including the expected resource mix's availability during extreme
weather conditions as part of extreme weather scenarios. ISO-NE asserts
that resource mix availability should not be addressed in a
transmission planning standard because it is addressed as part of
resource adequacy assessment and other Reliability Standards, such as
the Cold Weather Reliability Standards. Further, ISO-NE argues that
transmission planning Reliability Standards need to consider resource
availability in planning cases, because generators will be required to
be ready to perform in extreme weather events under those other
standards.\141\ EPRI asks if the Commission intends for the concurrent
outages of generation and transmission assets to be modeled as an acute
event, and if so, requests clarification as to how it differs from the
P3 category of contingency events from TPL-001-5.1.\142\
---------------------------------------------------------------------------

    \141\ ISO-NE Comments at 2-4.
    \142\ EPRI Comments at PP 20-21. Category P3 requires the study
of the loss of a generator unit followed by system adjustments,
followed by a loss of one of the following: generator or
transmission circuit or transformer or shunt device or single pole
of a DC line as stated in Reliability Standard TPL-001.5.1, Table 1.
---------------------------------------------------------------------------

    84. NYISO recommends that, as the extreme events in Reliability
Standard TPL-001-5.1 are analogous to extreme contingencies rather than
extreme system conditions such as heatwaves, cold snaps, droughts,
etc., NERC planning events should be expanded to include the weather-
related loss of generation across areas of the system in the design-
basis contingencies rather than as an extreme contingency.\143\
---------------------------------------------------------------------------

    \143\ NYISO Comments at 13.

---------------------------------------------------------------------------

    85. Regarding modeling assumptions, LCRA asserts that the Standard
should not be prescriptive regarding the modeling assumptions,
particularly concerning generation availability, beyond developing the
study base case when available generation is insufficient to meet the
load with respect to extreme weather events.\144\ LCRA also cautions
that modeling too many outages will result in an unsolvable case that
cannot be analyzed.\145\
---------------------------------------------------------------------------

    \144\ LCRA Comments at 3.
    \145\ Id.
---------------------------------------------------------------------------

    86. While no comments recommended any specific threshold of
penetration of renewable resources that would trigger additional
analysis, PJM notes that special studies may be needed as greater
numbers of renewable, inverter-based resources (IBR), connect to the
Bulk-Power System. With a much higher IBR penetration level, a more
material change to dynamic and steady state assessment will likely be
needed to capture the impacts of higher penetration levels of IBRs and
much reduced conventional generation support.\146\ APS, however,
suggests that the Commission should not set a penetration threshold,
arguing that the entity performing the study should determine the
threshold, which likely would differ depending on the characteristics
of the particular system.\147\
---------------------------------------------------------------------------

    \146\ PJM Comments at 11.
    \147\ APS Comments at 5.
---------------------------------------------------------------------------

    87. Electric Power Supply Association (EPSA) suggests that the
Commission direct NERC to examine how it defines and measures its
resource adequacy benchmarks, including the impacts of non-dispatchable
resources with increasing penetration in the system and the
availability of dispatchable, flexible resources which are increasingly
being replaced by new, less flexible resources or technologies.\148\
---------------------------------------------------------------------------

    \148\ EPSA Comments at 3.
---------------------------------------------------------------------------

2. Commission Determination
    88. Pursuant to section 215(d)(5) of the FPA, we adopt the NOPR
proposal and direct NERC to require under the new or revised
Reliability Standard the study of concurrent/correlated generator and
transmission outages due to extreme heat and cold events in benchmark
events as described in more detail below.
    89. We disagree with comments suggesting that the modeling of
concurrent/correlated generator and transmission outages is
unnecessary.\149\ As discussed in the NOPR, and reinforced by
commenters, the failures of individual generators during extreme
weather events are not independent.\150\ Previous extreme weather
events have demonstrated that there is a high correlation between
generator outages and cold temperatures, indicating that as
temperatures decrease, unplanned generator outages and derates
increase.\151\ Because of this correlation, it is necessary that
responsible entities evaluate the risk of correlated or concurrent
outages and derates of all types of generation resources and
transmission facilities as a result of extreme heat and cold events, as
commenters suggest.\152\
---------------------------------------------------------------------------

    \149\ See, e.g., ISO-NE Comments at 2-4.
    \150\ NOPR, 179 FERC ] 61,195 at P 70.
    \151\ Id. PP 70-71.
    \152\ See supra P 82.
---------------------------------------------------------------------------

    90. Further, we disagree with ISO-NE that resource mix availability
should not be considered here because it is considered in resource
adequacy planning and in other Reliability Standards. Although resource
outages are an important input into the resource adequacy studies, they
are also an important determinant in assessing the adequacy of the
transmission system.\153\ Therefore, it will be necessary to consider
the impact of extreme weather events on generators anticipated to be
connected to the subject transmission system during the study period.
Similarly, although the Cold Weather Reliability Standards require
generators to be prepared to be available and perform at or above their
extreme cold weather temperature during extreme weather events,
generator availability is not guaranteed by any Reliability Standard,
and outages occur for many reasons. Accordingly, some generators may
still be unavailable under extreme heat or cold conditions and thus
their potential outages must be considered in extreme heat and cold
weather planning scenarios.
---------------------------------------------------------------------------

    \153\ This understanding is consistent with section 215(a)(1) of
the FPA, 16 U.S.C. 824o(a)(1), which defines Bulk-Power System to
include ``electric energy from generation facilities needed to
maintain transmission system reliability.''
---------------------------------------------------------------------------

    91. Although several commenters ask for flexibility as to modeling
assumptions, we believe that it is necessary for the Reliability
Standard to strike a balance between allowing responsible entities
discretion to ensure the study incorporates their operating experience
and the need to create a robust framework that ensures extreme heat and
cold events are adequately studied. Thus, while generation and
transmission availability and concurrent outages must be included in
the benchmark planning case, we defer to NERC to develop the framework
and criteria that responsible entities shall use to represent potential
weather-related contingencies (e.g., concurrent/correlated generation
and transmission outages, derates) in the relevant benchmark event
planning cases.\154\
---------------------------------------------------------------------------

    \154\ See supra P 39. Reliability Standard TPL-001-5.1
Requirement 1.1.5 requires responsible entities to maintain system
models that represent projected system conditions, including
resources required for load. Because drought conditions may impact
the availability of certain supply resources, we expect that the new
or revised Reliability Standard will include a similar requirement
that accounts for the impact of drought conditions on generation
where appropriate.
---------------------------------------------------------------------------

    92. Regarding the comments of NYISO and EPRI on the difference
between extreme events and contingencies covered under Reliability
Standard TPL-001-5.1, we clarify that all contingencies included in
benchmark planning cases under the new or modified Reliability Standard
will represent initial conditions for extreme weather event planning
and analysis. These contingencies (i.e., correlated/concurrent,
temperature sensitive outages, and derates) shall be identified based
on similar contingencies that occurred in recent extreme weather events
or expected to occur in future forecasted events.
    93. Regarding PJM's comment regarding the likely need for
additional studies to capture the impacts of higher penetration levels
of renewables and much reduced conventional generation support, we note
that the benchmark planning case will include this information pursuant
to our directive above regarding benchmarking planning cases.
Accordingly, we do not foresee the need for the additional studies
suggested by PJM.
    94. Lastly, regarding EPSA's comment requesting that we direct NERC
to examine how it defines and measures its resource adequacy
benchmarks, we note that resource adequacy benchmarks are outside the
scope of this proceeding.

G. Conduct Transmission System Planning Studies for Extreme Heat and
Cold Weather Events

1. Steady State and Transient Stability Analyses
    95. The Commission proposed in the NOPR to require both steady
state and transient stability analyses be conducted for extreme heat
and cold weather events as part of transmission planning studies.\155\
Consistent with Reliability Standard TPL-001-5.1, the NOPR stated that
steady state and stability analyses of study cases modeled to reflect
past and forecasted extreme heat and cold conditions would better
prepare transmission operators for such

conditions.\156\ The NOPR explained that a steady-state analysis is
based on a snapshot in time where the bulk electric system facilities
such as generators, transmission lines, transformers etc. are modeled
as fixed and load is modeled as a constant.\157\ On the other hand,
transient stability or dynamic analyses simulate the time-varying
characteristics of the system during a disturbance that occurs during
an extreme heat or cold event.\158\ The NOPR further stated that
performing these studies in the long-term planning horizon period
(i.e., six to ten years and beyond) will provide an adequate lead time
for entities to develop and implement corrective action plans to reduce
the likelihood or mitigate the consequences and adverse impacts of such
events.\159\
---------------------------------------------------------------------------

    \155\ NOPR, 179 FERC ] 61,195 at P 69.
    \156\ Id. P 70.
    \157\ Id. P 59.
    \158\ Id. P 60.
    \159\ Id. P 58.
---------------------------------------------------------------------------

    96. The NOPR noted that the use of dynamic studies is particularly
important given the changing resource mix and the need to understand
the dynamic behavior of both traditional generators and variable energy
resources (VERs) (i.e., wind and solar photovoltaic).\160\
---------------------------------------------------------------------------

    \160\ Id. P 61.
---------------------------------------------------------------------------

    97. The NOPR sought comments on all aspects of the proposal, and
specifically, on whether responsible entities should include
contingencies based on their planning area and perform both steady
state and transient stability (dynamic) analyses using extreme heat and
cold cases. In addition, the NOPR invited comments on the following
topics: (1) the set of contingencies responsible entities must
consider; (2) required analyses to assess voltage stability, frequency
excursions and angular deviations caused as a result of near
simultaneous outages or common mode failures of VERs; and (3) the role
of demand response under such scenarios.\161\
---------------------------------------------------------------------------

    \161\ Id. P 62. The NOPR also sought comment on whether existing
Reliability Standards are sufficient to ensure that responsible
entities performing studies of extreme heat and cold weather
conditions have the necessary data, and/or whether the Commission
should direct additional modifications pursuant to FPA section
215(d)(5) to address this issue. Id. P 63. This question is
discussed in section IV.E of this final rule.
---------------------------------------------------------------------------

a. Comments
    98. All those who commented on the NOPR proposal to require both
steady state and transient stability analyses agree with the NOPR that
both steady state and transient stability analyses should be performed
in order to understand the potential impacts of extreme heat and cold
weather events.\162\ Below, we discuss comments received on the
following topics: (i) required contingencies; (ii) analyses of common
mode failures; and (iii) demand response.
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    \162\ See, e.g., NERC Comments at 9; PJM Comments at 10; Tri-
State Comments at 4; Eversource Comments at 5; WE ACT for
Environmental Justice Comments at 4; LCRA Comments at 3; UCS
Comments at 7.
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i. Required Set of Contingencies
    99. Idaho Power supports the inclusion of contingencies listed in
Table 1 of Reliability Standard TPL-001-4 such as the loss of two
generating stations resulting from, among other events, severe weather,
as it currently applies these contingencies in its severe weather
studies.\163\
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    \163\ Idaho Power Comments at 3.
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    100. AEP recommends that the Commission direct NERC to revise and
reclassify the contingency lists in Reliability Standard TPL-001-5.1 to
``reflect the unique challenges posed by extreme weather events'' and
to ensure that the bulk electric system is operated to withstand N-1-1
contingencies ``without interruption of firm transmission service or
non-consequential load loss.'' \164\ NYISO recommends expanding NERC
planning events to include the weather-related loss of generation
across areas of the system in the design-basis contingencies rather
than as an extreme contingency.\165\ Southern California Edison Company
(SCE) suggests that NERC determine whether additional contingencies
should be developed to evaluate potential reliability risks from events
occurring at the same or sequential times in the same region that have
the potential to pose an aggregate impact on electricity assets,
operations, and services, e.g., an extreme heat event that reduces grid
capacity while increasing demand for cooling.\166\ LCRA suggests that
performing contingency analyses similar to what is required under
Reliability Standard CIP-014-3 (Physical Security) may be useful.\167\
LCRA states, for example, that the analysis could study the outage of
medium impact facilities (e.g., single circuit, common tower). If the
result of the analysis identifies instability, cascading, uncontrolled
islanding, or excessive load shed, these facilities could be identified
as ``weather critical'' and targeted for hardening as part of a
corrective action plan.\168\
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    \164\ AEP Comments at 4.
    \165\ NYISO Comments at 14.
    \166\ SCE Comments at 4.
    \167\ Reliability Standard CIP-014-3 requires entities to assess
their transmission facilities to determine whether, if rendered
inoperable or damaged, they could result in widespread instability,
uncontrolled separation, or cascading. Reliability Standard CIP-014-
3 (Physical Security), at 1.
    \168\ LCRA Comments at 2.
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    101. Other commenters state that responsible entities should be
able to consider contingencies beyond those in Table 1 of Reliability
Standard TPL-001.5.1 that will affect their study area.\169\ For
example, PJM emphasizes the need for regional variance for unique
contingencies to be studied.\170\ Eversource recommends that the
Commission avoid prescription and allow details such as the types of
required contingencies to be determined during the standard development
process.\171\
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    \169\ AEP Comments at 4; Idaho Power Comments at 3; Tri-State
Comments at 4, PJM Comments at 11.
    \170\ AEP Comments at 4; Idaho Power Comments at 3; Tri-State
Comments at 4, PJM comments at 11.
    \171\ Eversource Comments at 4.
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    102. EPRI asserts that clarification is needed to differentiate
between events that impact the initial conditions of the benchmark
scenario for which the contingency events will be analyzed, and the
actual contingencies meant to be captured as acute impacts to the
system that occur over a wide area and can be studied through the
steady state and transient stability processes.\172\
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    \172\ EPRI Comments at P 21.
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ii. Analyses for Common Mode Failures
    103. NERC and ACP agree that Reliability Standard TPL-001-5.1
should better address the risk posed by extreme heat and cold weather
events and the associated common mode failure impacting resource
availability and the transmission system.\173\
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    \173\ NERC Comments at 6; ACP Comments at 9 n.23.
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    104. EPRI states that the benchmark planning cases, which serve as
the basis for steady state and transient stability assessments,
historically have not been developed to include the correlated impacts
of common mode events based on the impact of extreme temperature on
load and the availability of derated generation and transmission
capacity. EPRI asserts that capturing extreme temperature conditions
for both heat and cold would require a new approach that directly
accounts for the correlated temperature-related impacts to supply and
demand.\174\ EPRI agrees with the Commission's proposal that dynamic
models of VERs need to be included in the studies but states they would
need to be sufficiently robust to accurately capture system performance
under extreme weather conditions.\175\
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    \174\ EPRI Comments at PP 3-4.
    \175\ Id. P 11.

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    105. Indicated Trade Associations state that in any case modeling
these scenarios will likely require additional resources in time,
expertise, and enhanced software capabilities.\176\ Indicated Trade
Associations ask that the standard drafting team recognize the range
and quantity of complexities layered into the modeling process, e.g.,
whether concurrent generators must be in a single or multiple balancing
authority area, how many generators are needed for a given study, and
if there is a particular combination of generators needed for
modeling.\177\
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    \176\ Indicated Trade Associations at 9.
    \177\ Id.
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iii. Demand Response
    106. EDF and UCS suggest that when evaluating relevant distribution
system impacts, responsible entities should focus on the impacts of the
extreme weather event on both electric demand and on the capability of
the distribution system assets, including demand response, distributed
storage and generation, and utility-scale storage, to mitigate
reliability risks.\178\
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    \178\ EDF Comments at 22-23; UCS Comments at 7-8.
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    107. APS comments that demand response should be used as a tool to
resolve issues and only studied when it is relied on as a mitigation
action.\179\
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    \179\ APS Comments at 4.
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    108. Eversource states that the Commission should encourage
regional flexibility in any consideration of demand response.
Eversource further comments that the Commission should not impose a
``one size fits all'' approach for resources that may significantly
differ based on location. It is also concerned that during extreme
weather events, demand response with heating or cooling-based load
reduction may not be achievable due to safety concerns.\180\
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    \180\ Eversource Comments at 6.
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    109. EPRI asserts that steady state simulation cannot sufficiently
capture demand response, and that there is limited capability to
capture the aggregated dynamic response of demand in the load models
used in positive sequence platforms. EPRI adds that ``the impacts of
demand response are better represented through appropriate temporal and
diurnal patterns that would inform the load and demand profile under a
given extreme temperature condition. This information is best
represented in operational assessments such as resource adequacy or
production cost modeling.'' \181\
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    \181\ EPRI Comments at P 12.
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    110. LCRA notes that while the role of demand response in its
portion of the Bulk-Power System is negligible today, this could change
in the future as additional large loads (e.g., cryptocurrency mining
and data centers) are energized. LCRA states that this trend should be
observed for further consideration in the future.\182\
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    \182\ LCRA Comments at 2-3.
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b. Commission Determination
    111. Pursuant to section 215(d)(5) of the FPA, we adopt the NOPR
proposal and direct NERC to require in the proposed new or modified
Reliability Standard that responsible entities perform both steady
state and transient stability (dynamic) analyses in the extreme heat
and cold weather planning studies. In a steady state analysis, the
system components are modeled as either in-service or out-of-service
and the result is a single point-in-time snapshot of the system in a
state of operating equilibrium. A transient stability (dynamic)
analysis examines the system from the start to the end of a disturbance
to determine if the system regains a state of operating
equilibrium.\183\ Performing both analyses ensures that the system has
been thoroughly assessed for instability, uncontrolled separation, and
cascading failures in both the steady state and the transient stability
realms.
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    \183\ Plots are created during the dynamic simulation from pre
to post disturbance and are then examined for voltage, frequency,
and rotor angle stability, which cannot be assessed using only a
steady state analysis.
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    112. We also adopt the NOPR proposal and direct NERC to define a
set of contingencies that responsible entities will be required to
consider when conducting wide-area studies of extreme heat and cold
weather events under the new or modified Reliability Standard. We
believe that it is necessary to establish a set of common contingencies
for all responsible entities to analyze. Required contingencies, such
as those listed in Table 1 of Reliability Standard TPL-001-5.1 (i.e.,
category P1 through P7), establish common planning events that set the
starting point for transmission system planning assessments. Requiring
the study of predefined contingencies will ensure a level of uniformity
across planning regions--a feature that will be necessary in the new or
revised Reliability Standard considering that extreme heat and cold
weather events often exceed the geographic boundaries of most existing
planning footprints.
    113. Additionally, establishing a set of required contingencies
will aide in the auditing and enforcement of the new or revised
Reliability Standard. While we do not require in this final rule the
inclusion of any particular contingency, we agree with commenters that
the contingencies required in the new or revised Reliability Standard
should reflect the complexities of transmission system planning studies
for extreme heat and cold weather events. As such, NERC may determine
whether contingencies P1 through P7 should also apply to the new or
modified Reliability Standard, or whether a new set of contingencies
should be developed.
    114. Regarding the request for clarification from EPRI as to what
outages should be included in the benchmark planning case versus
modeled as contingencies, we believe the standard drafting team is best
positioned to consider that specific question. By definition, the
benchmark planning case will already include certain weather-related
contingencies that therefore will not be studied as additional
contingencies when conducting extreme weather studies.\184\ For
example, baseline drought conditions will be present in the benchmark
planning case as part of the system models representing projected
system conditions,\185\ whereas the impacts of more severe droughts
could be studied during sensitivity analysis as a variation to the
benchmark planning case's generation assumptions.\186\ As discussed in
section IV.F above, we direct NERC to develop specific criteria for
determining which outages should be considered in the benchmark
planning case.
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    \184\ See supra P 39.
    \185\ See supra note 155.
    \186\ See infra P 124.
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    115. Regarding the study of common mode failures, we reiterate our
above directives concerning the study of concurrent/correlated
generator and transmission outages. We believe that, as suggested by
Indicated Trade Associations, the standard development process will
provide an adequate platform to address the concerns raised by
commenters regarding common mode failures.
    116. We also direct NERC to require in the new or modified
Reliability Standard that responsible entities model demand load
response in their extreme weather event planning area. As indicated by
several commenters, because demand load response is generally a
mitigating action that involves reducing distribution load during
periods of stress to stabilize the Bulk-Power System, its effect during
an extreme weather event should be modeled.
    117. Regarding EPRI's comment that steady state simulation cannot

sufficiently capture demand load response, we believe EPRI's comments
are accurate for modeling in the operational timeframe for temporal and