[Federal Register: November 24, 2010 (Volume 75, Number 226)]
[Proposed Rules]
[Page 71613-71625]
[DOCID:fr24no10-42]

=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 40

[Docket No. RM10-15-000]

Mandatory Reliability Standards for Interconnection Reliability
Operating Limits

November 18, 2010.
AGENCY: Federal Energy Regulatory Commission.

ACTION: Notice of proposed rulemaking.

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

SUMMARY: Under section 215 of the Federal Power Act, the Federal Energy
Regulatory Commission proposes to approve three new Interconnection
Reliability Operations and Coordination Reliability Standards and seven
revised Reliability Standards related to Emergency Preparedness and
Operations, Interconnection Reliability Operations and Coordination,
and Transmission Operations. These proposed Reliability Standards were
submitted to the Commission for approval by the North American Electric
Reliability Corporation, which the Commission has certified as the
Electric Reliability Organization responsible for developing and
enforcing mandatory Reliability Standards. The proposed Reliability
Standards were designed to prevent instability, uncontrolled
separation, or cascading outages that adversely impact the reliability
of the interconnection by ensuring prompt action to prevent or mitigate
instances of exceeding Interconnection Reliability Operating Limits.
The Commission also proposes to approve the addition of two new terms
to the NERC Glossary of Terms. In addition, pursuant to section
215(d)(5) of the Federal Power Act, the Commission proposes to direct
NERC to develop a modification to the proposed term ``Real-time
Assessment'' to address a specific concern identified by the
Commission. The Commission raises some concerns with regard to certain
aspects of NERC's proposals and, based on the responses from NERC and
industry, may choose to direct certain modifications to the proposed
new and revised Reliability Standard, as well as the new Glossary
Terms, as discussed below.

DATES: Comments are due January 24, 2011.

ADDRESSES: You may submit comments, identified by docket number and in
accordance with the requirements posted on the Commission's Web site,
http://www.ferc.gov. Comments may be submitted by any of the following
methods:
     Agency Web site: Documents created electronically using
word processing software should be filed in native applications or
print-to-PDF format, and not in a scanned format, at http://
www.ferc.gov/docs-filing/efiling.asp.
     Mail/Hand Delivery: Commenters unable to file comments
electronically must mail or hand-deliver an original copy of their
comments to: Federal Energy Regulatory Commission, Secretary of the
Commission, 888 First Street, NE., Washington, DC 20426. These
requirements can be found on the Commission's Web site, see, e.g., the
``Quick Reference Guide for Paper Submissions,'' available at
    http://www.ferc.gov/docs-filing/efiling.asp or via phone from FERC
Online Support at<PHONE_NUMBER> or toll-free at 1-866-208-3676.

FOR FURTHER INFORMATION CONTACT:

Darrell Piatt (Technical Information), Office of Electric Reliability,
Division of Reliability Standards, Federal Energy Regulatory
Commission, 888 First Street, NE., Washington, DC 20426, Telephone:
(202) 502-6687;
A. Cory Lankford (Legal Information), Office of the General Counsel,
Federal Energy Regulatory Commission, 888 First Street, NE. Washington,
DC 20426, Telephone:<PHONE_NUMBER>;
William Edwards (Legal Information), Office of the General Counsel,
Federal

Energy Regulatory Commission, 888 First Street, NE., Washington, DC
20426, Telephone:<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Table of Contents

                                                               Paragraph
                                                                numbers

I. Background...............................................           3
    A. Mandatory Reliability Standards......................           3
    B. Order No. 693 Directives.............................           4
II. Discussion..............................................           7
    A. System Operating Limits..............................          10
    B. Proposed New Reliability Standards...................          22
        1. IRO-008-1........................................          22
        2. IRO-009-1........................................          30
        3. IRO-010-1a.......................................          33
    C. Proposed Revised Reliability Standards...............          38
        1. EOP-001-1........................................          38
        2. IRO-002-2........................................          42
        3. IRO-004-2........................................          47
        4. IRO-005-3........................................          54
        5. TOP-003-1........................................          58
        6. TOP-005-2........................................          61
        7. TOP-006-2........................................          66
    D. Violation Severity Levels and Violation Risk Factors.          69
III. Information Collection Statement.......................          77
IV. Environmental Analysis..................................          82
V. Regulatory Flexibility Act Certification.................          83
VI. Comment Procedures......................................          84
VII. Document Availability..................................          88

Notice of Proposed Rulemaking

    1. Under section 215 of the Federal Power Act (FPA),\1\ the Federal
Energy Regulatory Commission (Commission) proposes to approve three new
Interconnection Reliability Operations and Coordination (IRO)
Reliability Standards and seven revised Reliability Standards related
to Emergency Preparedness and Operations (EOP), IRO, and Transmission
Operations (TOP). The proposed Reliability Standards were submitted to
the Commission for approval by the North American Electric Reliability
Corporation (NERC), which the Commission has certified as the Electric
Reliability Organization (ERO) responsible for developing and enforcing
mandatory Reliability Standards.\2\ The proposed Reliability Standards
were designed to prevent instability, uncontrolled separation, or
cascading outages that adversely impact the reliability of the
interconnection by ensuring prompt action to prevent or mitigate
instances of exceeding interconnection reliability operating limits
(IROL). The Commission also proposes to approve the addition of two new
terms to the NERC Glossary of Terms (NERC Glossary). In addition,
pursuant to section 215(d)(5) of the Federal Power Act, the Commission
proposes to direct NERC to develop a modification to the proposed term
``Real-time Assessment'' to address a specific concern identified by
the Commission. The Commission raises some concerns with regard to
certain aspects of these proposals and, based on the responses from
NERC and from industry, may choose to direct certain modifications to
the proposed new and revised Reliability Standard, as well as the new
Glossary Terms, as discussed below.
---------------------------------------------------------------------------

    \1\ 16 U.S.C. 824o.
    \2\ North American Electric Reliability Corp., 116 FERC ]
61,062, order on reh'g & compliance, 117 FERC ] 61,126 (2006), aff'd
sub nom. Alcoa, Inc. v. FERC, 564 F.3d 1342 (DC Cir. 2009).
---------------------------------------------------------------------------

    2. The three new Reliability Standards proposed by NERC are
designated as IRO-008-1 (Reliability Coordinator Operational Analyses
and Real-time Assessments), IRO-009-1 (Reliability Coordinator Actions
to Operate Within IROLs), and IRO-010-1a \3\ (Reliability Coordinator
Data Specification and Collection). In preparing these new Reliability
Standards, the standards drafting team determined that it was necessary
to retire or modify certain requirements from several existing
standards. Accordingly, NERC requests Commission approval of revised
Reliability Standards EOP-001-2,\4\ IRO-002-2, IRO-004-2, IRO-005-3,
and TOP-006-2. NERC also proposes to add the following new terms to the
NERC Glossary: ``Operational Planning Analysis'' and ``Real-time
Assessment.'' \5\
---------------------------------------------------------------------------

    \3\ NERC designates the version number of a Reliability Standard
as the last digit of the Reliability Standard number. Therefore,
original Reliability Standards end with ``-0'' and modified version
one Reliability Standards end with ``-1.'' The NERC Board of
Trustees approved the proposed IRO-010-1 Reliability Standard on
October 17, 2008. Subsequently, on August 5, 2009, the NERC Board of
Trustees approved an interpretation to the proposed IRO-010-1
standard. Accordingly, NERC is requesting approval of both the
proposed standard and the appended interpretation, and NERC has
designated the proposed standard and appended interpretation as IRO-
010-1a.
    \4\ Concurrent with its filing in this Docket, NERC filed a
petition in Docket No. RM10-16-000 seeking approval of certain
Emergency Preparedness and Operations Reliability Standards. NERC,
Petition for Approval of Three Emergency Preparedness and Operations
Reliability Standards, Docket No. RM10-16-000 (filed Dec. 31, 2009).
As part of its filing in RM10-16-000, NERC proposed to retire
Requirement R3.4 of EOP-001-0. Each petition proposes unique changes
to EOP-001-0 reflecting the distinct issues addressed by the
respective Reliability Standards drafting teams. NERC indicated in
both petitions that it could not anticipate the sequence in which
the Commission would act and therefore included two sets of proposed
amendments to EOP-001-0 in each petition. The Commission will
clarify upon issuance of Final Rules in each proceeding which
revised version of EOP-001-0 it is addressing in its determination.
    \5\ The proposed new Reliability Standards and other modified
Reliability Standards are not codified in the CFR and are not
attached to the NOPR. They are, however, available on the
Commission's eLibrary document retrieval system in Docket No. RM10-
15-000 and are available on the ERO's Web site, http://www.nerc.com.
---------------------------------------------------------------------------

I. Background

A. Mandatory Reliability Standards

    3. Section 215 of the FPA requires a Commission-certified ERO to
develop mandatory and enforceable Reliability Standards, which are
subject to Commission review and approval. Once approved, the
Reliability Standards are

enforced by the ERO, subject to Commission oversight, or by the
Commission independently.

B. Order No. 693 Directives

    4. On March 16, 2007, the Commission issued Order No. 693,
approving 83 of the 107 initial Reliability Standards filed by NERC,
including the existing IRO Reliability Standards.\6\ Under section
215(d)(5) of the FPA, the Commission directed NERC to develop
modifications to the IRO Reliability Standards to address certain
issues identified by the Commission.
---------------------------------------------------------------------------

    \6\ Mandatory Reliability Standards for the Bulk-Power System,
Order No. 693, 72 FR 16416 (Apr. 4, 2007), FERC Stats. & Regs. ]
31,242, order on reh'g, Order No. 693-A, 120 FERC ] 61,053 (2007).
---------------------------------------------------------------------------

    5. With respect to IRO-001-1, the Commission directed the ERO to
develop modifications to eliminate the regional reliability
organization as an applicable entity.\7\ The Commission also directed
the ERO to modify IRO-002-1 to require a minimum set of capabilities
that must be made available to the reliability coordinator to ensure
that a reliability coordinator has the capabilities it needs to perform
its functions.\8\ With respect to IRO-003-2, the Commission directed
the ERO to develop a modification to create criteria to define the term
``critical facilities'' in a reliability coordinator's area and its
adjacent systems.\9\ The Commission also directed the ERO to modify
IRO-004-1 to require the next-day analysis to identify control actions
that can be implemented and effective within 30 minutes after a
contingency. In addition, the Commission directed the ERO to consider
adding Measures and Levels of Non-Compliance to Reliability Standards
IRO-004-1 and IRO-005-1 that are commensurate with the magnitude,
duration, frequency and causes of the violations and whether these
occur during normal or contingency conditions.\10\
---------------------------------------------------------------------------

    \7\ Order No. 693, FERC Stats. & Regs. ] 31,242 at P 896.
    \8\ Id. P 908.
    \9\ Id. P 914.
    \10\ Id. P 935. NERC has subsequently replaced Levels of Non-
Compliance with Violation Severity Levels. See Order on Violation
Severity Levels Proposed by the Electric Reliability Organization,
123 FERC ] 61,284 (Violation Severity Level Order), order on reh'g,
125 FERC ] 61,212 (2008).
---------------------------------------------------------------------------

    6. The Commission also directed the ERO to conduct a survey on IROL
practices and actual operating experiences by requiring reliability
coordinators to report any violations of IROLs, their causes, the date
and time, the durations and magnitudes in which actual operations
exceed IROLs to the ERO on a monthly basis for one year beginning two
months after the effective date of Order No. 693.\11\ On October 31,
2008, NERC filed the results of its year-long survey with the
Commission.\12\ On February 8, 2009, NERC supplemented those results in
a second filing.\13\
---------------------------------------------------------------------------

    \11\ Id. P 951.
    \12\ NERC, Compliance Filing, Docket No. RM06-16-006 (filed Oct.
31, 2008).
    \13\ NERC, Compliance Filing, Docket No. RM06-16-006 (filed Feb.
8, 2009).
---------------------------------------------------------------------------

II. Discussion

    7. In a December 31, 2009 filing (NERC Petition),\14\ NERC requests
Commission approval of proposed Reliability Standards IRO-008-1, IRO-
009-1, and IRO-010-1a. NERC contends that these new Reliability
Standards would address certain Commission directives from Order No.
693. In developing the new IRO Reliability Standards, NERC determined
that it was necessary to retire or modify certain requirements from
several existing standards. Accordingly, NERC proposes revised
Reliability Standards EOP-001-1, IRO-002-2, IRO-004-2, IRO-005-3, TOP-
003-1, TOP-005-2, and TOP-006-2. NERC also requests approval of new
definitions ``Operational Planning Analysis'' and ``Real-time
Assessment.''
---------------------------------------------------------------------------

    \14\ North American Electric Reliability Corp., Dec. 31, 2009
Petition for Approval of Proposed New and Revised Reliability
Standards for Operating Within Interconnection Operating Limits
(NERC Petition).
---------------------------------------------------------------------------

    8. As discussed below, the Commission proposes to approve new
Reliability Standards IRO-008-1, IRO-009-1, and IRO-010-1a. The
Commission also proposes to approve revised Reliability Standards EOP-
001-1, IRO-002-2, IRO-004-2, IRO-005-3, TOP-003-1, TOP-005-2, and TOP-
006-2 as well as the two new NERC Glossary terms.
    9. In addition, the Commission seeks comment on specific concerns
related to the proposed IRO Reliability Standards, as set forth below.

A. System Operating Limits

    10. To maintain the reliable operation of the Bulk-Power System,
reliability coordinators, balancing authorities, and transmission
operators must be aware of the applicable system operating limits
(SOLs) and interconnection reliability operating limits (IROLs) on
their system. NERC defines SOLs as the value (such as MW, MVar,
Amperes, Frequency or Volts) that satisfies the most limiting of the
prescribed operating criteria for a specific system configuration to
ensure operation within acceptable reliability criteria. These SOLs are
based upon certain operating criteria. IROLs are, essentially, a subset
of SOLs. NERC defines IROLs as the value (such as MW, MVar, Amperes,
Frequency or Volts) derived from, or a subset of the SOLs, which if
exceeded, could expose a widespread area of the bulk electric system to
instability, uncontrolled separation, or cascading outages.\15\
---------------------------------------------------------------------------

    \15\ See NERC Glossary, available at http://www.nerc.com/docs/
standards/rs/Glossary_of_Terms_2010April20.pdf.
---------------------------------------------------------------------------

NERC Proposal
    11. The proposed IRO Reliability Standards together with the
proposed revisions to existing Reliability Standards would divide
responsibility for SOLs and IROLs between reliability coordinators and
transmission operators according to the Functional Model.\16\ NERC
explains that having two entities with the same primary responsibility
is not supported by the Functional Model. However, NERC notes that the
proposed Reliability Standards should not imply that the reliability
coordinator will not look at its future operations with respect to
specific SOLs.\17\ NERC states that the reliability coordinator must
look at its future operations with respect to specific SOLs to ensure
that their transmission operators are taking actions at appropriate
times, but the primary responsibility for SOLs rests with the
transmission operators. NERC explains that, under the proposed
Reliability Standards, the reliability coordinator retains overall
visibility of all operations within its Wide-Area view, including some
SOLs, although the transmission operator is primarily responsible for
actions related to SOLs.\18\ NERC states that the IRO standards were
developed in support of the authority and assignment of tasks in the
Functional Model.\19\ NERC explains that under the Functional Model,
while reliability coordinators will assign their transmission operators
tasks associated with IROLs, the reliability coordinator has ultimate
responsibility for these tasks, and the reliability coordinator is
sanctioned if these tasks are not performed as required by the
Reliability Standards.\20\
---------------------------------------------------------------------------

    \16\ NERC, Reliability Functional Model, version 5, at 30 (Nov.
2009), available at http://www.nerc.com/files/Functional_Model_
V5_Final_2009Dec1.pdf.
    \17\ NERC Petition at 77.
    \18\ Id. at 78.
    \19\ Id. at 7-9.
    \20\ Id. at 8.
---------------------------------------------------------------------------

    12. NERC explains that, under the Functional Model, the reliability
coordinator is the functional entity with the highest level of
responsibility and authority for real-time reliability of the Bulk-
Power System. NERC states that the reliability coordinator is
responsible

for identifying the subset of SOLs that are known as IROLs, and may
direct its transmission operators to take actions associated with
IROLs. In assigning a single task to a single functional entity, under
the Functional Model, the reliability coordinator is the sole
functional entity responsible for developing IROLs and for actions to
prevent/mitigate instances of exceeding IROLs. While the transmission
operator has no ``direct'' responsibility for developing IROLs, the
transmission operator may be assigned the task of developing some
IROLs, monitoring real-time values against identified IROLs, and taking
actions to prevent reaching an IROL or to mitigate an instance of
exceeding an IROL. However, the transmission operator only performs
these tasks when directed to do so by its reliability coordinator.\21\
---------------------------------------------------------------------------

    \21\ Id.
---------------------------------------------------------------------------

    13. NERC further explains that, in a similar fashion, the
Functional Model assigns responsibility for SOLs that are not IROLs to
the transmission operator. But, NERC states, this too is a shared
responsibility.\22\ NERC states that where the Transmission Operator
has primary responsibility for developing the SOLs within its
transmission operator area, the transmission operator may request the
assistance of its reliability coordinator in developing these SOLs. In
addition, NERC states that it is the reliability coordinator that is
held responsible for ensuring that transmission operators develop SOLs
for its reliability coordinator area in accordance with a methodology
developed by the reliability coordinator. NERC states that the
transmission operator must share its SOLs with its reliability
coordinator, and the reliability coordinator must share any SOLs it
develops with its transmission operator. NERC also states that the
reliability coordinator monitors the status of some, but not all, SOLs.
---------------------------------------------------------------------------

    \22\ Id. at 9.
---------------------------------------------------------------------------

    14. According to NERC, the reliability coordinator's visualization
capabilities are not expected to display all SOLs within the Wide-Area
that the reliability coordinator monitors because this would mix SOLs
that have little impact on reliability with those SOLs that are
associated with facilities that are important to the Bulk-Power System.
NERC states that the reliability coordinator's visualization
capabilities are expected to display the real-time status of parameters
against all IROLs that the reliability coordinator monitors and also
display the subset of SOLs associated with facilities that are most
critical to the portions of the Bulk-Power System that are monitored by
the reliability coordinator.
    15. Under proposed new Reliability Standards, IRO-008-1, IRO-009-1,
and IRO-010-1a, reliability coordinators must monitor and analyze IROLs
within their Wide-Area to prevent instability, uncontrolled separation,
or cascading outages that adversely impact the reliability of the
interconnection. These Reliability Standards would not require the
reliability coordinator to monitor and analyze SOLs other than IROLs
within their reliability coordinator area. Similarly, NERC's proposed
revisions to Reliability Standards EOP-001-1, IRO-002-2, IRO-004-2,
IRO-005-3, TOP-003-1, TOP-005-2, and TOP-006-2, inter alia, would
remove requirements for the reliability coordinator to monitor and
analyze SOLs other than IROLs.
Discussion
    16. We believe that it is appropriate to develop requirements for
Reliability Standards that offer a clear division of responsibilities
among reliability coordinators and transmission operators. We,
therefore, propose to approve NERC's proposed division of
responsibility for SOLs and IROLs among reliability coordinators and
transmission operators. Although we support NERC's proposal and propose
here to approve it with only a limited directive regarding one proposed
definition, we are also seeking comments from NERC and industry to
obtain further information and ensure that there will not be gaps in
the analysis of SOLs by reliability coordinators going forward,
particularly those SOLs that could become IROLs. NERC acknowledges in
its filing that the transmission operator must develop and share its
SOLs with its reliability coordinator, and the reliability coordinator
must develop and share any SOLs it develops with its transmission
operator.\23\ NERC also states that the reliability coordinator
monitors the status of some, but not all, SOLs.\24\ In addition, the
Commission is aware that NERC is currently working on a project to
identify a subset of SOLs, other than IROLs, that a reliability
coordinator must continuously monitor and analyze.\25\ Taken together,
NERC's statements and its ongoing project indicate a need for
reliability coordinators to continue to analyze certain SOLs. We,
therefore, seek comment on whether there is a need for reliability
coordinators to continue to analyze, in addition to continuing to
monitor and coordinate data on,\26\ SOLs other than IROLs.
---------------------------------------------------------------------------

    \23\ Id.
    \24\ Id.
    \25\ NERC identifies this as ``Project 2007-03: Real-time
Operations,'' available at http://www.nerc.com/filez/standards/Real-
time_Operations_Project_2007-03.html.
    \26\ Existing reliability standards that NERC does not propose
to change here continue to require reliability coordinators to
monitor SOLs. See Reliability Standard IRO-002-1 Requirement R6.
---------------------------------------------------------------------------

    17. Since the ERO has stated that responsibility for the SOLs is
shared between the reliability coordinator and their transmission
operators, we also believe it may be beneficial for the reliability
coordinator to have a documented methodology for identifying the SOL
information it needs to fulfill its responsibilities for monitoring,
day ahead and real-time assessments, and operational control within the
reliability coordinator's area. We seek comment on this matter.
    18. In addition, we request comment from NERC, reliability
coordinators, and other interested entities on the current practices of
reliability coordinators and transmission operators with respect to
coordinating operational responsibilities for monitoring, day ahead and
real-time assessments; and operating SOLs and IROLs, the practical
division of responsibilities for preventing and mitigating SOL and IROL
violations, and the monitoring capabilities of the reliability
coordinator with respect to IROLs as well as SOLs. The Commission
further seeks comment as to whether a reliability coordinator can
provide an accurate assessment of the Bulk-Power System to its
transmission operators on a Wide-Area basis, without evaluating: (1)
The operating environment on SOLs that will impact the transmission
operators within the reliability coordinator's areas; (2) SOLs that
have the potential to become IROLs; and (3) the existing IROLs within
the reliability coordinator area. In addition, the Commission seeks
comments as to whether a transmission operator can provide reliable
operating assessments or make reliable operating instructions on an SOL
that is on the border between two different transmission operator's
areas. The Commission also requests comment on whether the reliability
coordinator should have responsibility to monitor certain SOLs other
than IROLs, and whether such a responsibility would place an
unreasonable burden on reliability coordinators. If a reliability
coordinator should monitor certain SOLs other than IROLs, comments
should address in detail how reliability coordinators should determine
which SOLs to monitor.
    19. The Commission has noted that NERC Standard IRO-006,
Transmission

Loading Relief (TLR), requires the reliability coordinators in the
Eastern Interconnection to relieve overloads on the facilities modeled
in the Interchange Distribution Calculator (IDC). IRO-006 requires the
reliability coordinator to model the SOLs and IROLs in the IDC to
perform the TLR procedures. The Commission seeks comments on how the
reliability coordinators in the Eastern Interconnections selects the
SOLs for evaluation by the IDC and the extent of any burden this has
caused the reliability coordinator.
    20. The NERC Functional Model is a reference document developed by
NERC that outlines functions for each responsible entity in the NERC
Reliability Standards.\27\ NERC explains in its filing that the NERC
Functional Model was developed by first identifying all of the
operating tasks necessary for reliability, and then assigning each of
these operating tasks to a single functional entity.\28\ NERC states
that this approach results in a clear identification of a single
functional entity with responsibility for each reliability task.
However, NERC also states that in later versions of the Functional
Model, there are circumstances where the Functional Model assigns some
activities to more than one planning entity.\29\ NERC explains that,
under the Functional Model, the reliability coordinator is responsible
for identifying the subset of SOLs known as IROLs and that the
transmission operator is responsible for other SOLs. But the Functional
Model assigns a much broader role to the reliability coordinator to
maintain the real-time operating reliability of the bulk electric
system within its area. The Commission seeks comments from NERC and the
public as to how the current Functional Model represents the
delineation of assessment and operating responsibilities between the
reliability coordinator and transmission operator with respect to SOLs
and IROLs.
---------------------------------------------------------------------------

    \27\ NERC, Reliability Functional Model, version 5 at 30 (Nov.
2009), available at http://www.nerc.com/files/Functional_Model_
V5_Final_2009Dec1.pdf. NERC developed the current version of the
Functional Model after it developed the proposed Reliability
Standards.
    \28\ NERC Petition at 7.
    \29\ Id. at 7 n.9.
---------------------------------------------------------------------------

    21. Based on the foregoing, the Commission proposes to approve the
proposed new and revised Reliability Standards without modification
(with the exception of the limited directive proposed below), as they
appear to be an improvement over the existing Reliability Standards
with respect to the division of responsibilities between reliability
coordinators and transmission operators. Our intent in seeking comments
from NERC and industry in this NOPR is to better understand the
proposed division of responsibilities, as well as the future
modifications to those responsibilities that NERC intends to pursue.

B. Proposed New Reliability Standards

1. IRO-008-1
    22. Proposed Reliability Standard IRO-008-1 has the stated purpose
of preventing instability, uncontrolled separation, or cascading
outages that adversely impact the reliability of the interconnection by
ensuring that the Bulk Electric System is assessed during the
operations horizon. The proposed Reliability Standard applies to
reliability coordinators. IRO-008-1 requires the reliability
coordinator to use analyses and assessments as methods of achieving the
stated goal. The Reliability Standard requires analysis of the
reliability coordinator's Wide-Area \30\ ahead of time and during real-
time. It also requires communication with the entities that need to
take specific operational actions based on the analyses and
assessments.
---------------------------------------------------------------------------

    \30\ The term ``Wide-Area'' is defined in the NERC Glossary,
approved by the Commission. As defined, Wide-Area includes not only
the reliability coordinator's Area, but also critical flow and
status information from adjacent reliability Coordinator areas as
determined by detailed system studies to allow the calculation of
IROLs. See NERC Glossary available at http://www.nerc.com/docs/
standards/rs/Glossary_of_Terms_2010April20.pdf.
---------------------------------------------------------------------------

    23. Reliability Standard IRO-008-1 contains three requirements.
Requirement R1 requires each reliability coordinator to perform an
Operational Planning Analysis to assess whether the planned operations
for the next day within its Wide Area, will exceed any of its IROLs
during anticipated normal and contingency event conditions. Requirement
R2 requires the reliability coordinator to perform a Real-Time
Assessment at least once every 30 minutes to determine if its Wide Area
is exceeding any IROLs or is expected to exceed any IROLs. Requirement
R3 requires a reliability coordinator to share the results of an
Operational Planning Analysis or Real-Time Assessment that indicates
the need for specific operational actions to prevent or mitigate an
instance of exceeding an IROL with those entities that are expected to
take those actions.
    24. NERC explains that IRO-008-1, Requirement R1 does not specify
any single application program that all reliability coordinators must
use because the Requirement assumes that the reliability coordinator
has a suite of applications that it can use to conduct its assessment,
verified as part of the certification process. NERC notes that having
the ability to conduct a day-ahead contingency analysis is a
requirement for reliability coordinator certification.
    25. NERC also requests approval of two new terms that appear in
IRO-008-1: ``Operational Planning Analysis'' and ``Real-time
Assessment.'' Operational Planning Analysis is defined as:

    An analysis of the expected system conditions for the next day's
operation. (That analysis may be performed either a day ahead or as
much as 12 months ahead.) Expected system conditions include things
such as load forecast(s), generation output levels, and known system
constraints (transmission facility outages, generator outages,
equipment limitations, etc.).

NERC states that the definition was designed to provide greater
specificity regarding the day-ahead study. NERC explains that the term
``unique'' used in the currently-effective IRO-004-1 causes confusion.
NERC states that in the event there are no changes to the expected
conditions from one day to the next, the reliability coordinator would
not be forced to conduct a new analysis of the expected system
conditions solely to have documentation for compliance.
    26. The proposed term ``Real-time Assessment'' is defined as ``[a]n
examination of existing and expected system conditions, conducted by
collecting and reviewing immediately available data.'' The purpose of
the new term is to assure that the reliability coordinator is required
to conduct a real-time assessment, including situations when the
reliability coordinator is operating without its primary control
facilities, by collecting and reviewing available data. NERC explains
that the definition of Real-Time Assessment is purposefully ambiguous
to allow the assessment to be conducted either through the energy
management system or manually.
NOPR Proposal
    27. We agree with NERC that the proposed Reliability Standard IRO-
008-1 would prevent instability, uncontrolled separation, or cascading
outages that adversely impact the reliability of the interconnection by
ensuring that the bulk electric system is assessed during the
operations horizon. In addition, the Commission recognizes NERC's
effort to create a body of IRO Reliability Standards that clearly
define which functional entity has the ultimate responsibility for SOLs
and IROLs. Accordingly, pursuant to section 215(d)(2) of the FPA, the
Commission proposes to approve Reliability

Standards IRO-008-1, as just, reasonable, not unduly discriminatory or
preferential, and in the public interest. To ensure that the proposed
changes are supported by the Functional Model, the Commission requests
comment whether the proposed Reliability Standards, such as IRO-008-1,
appropriately resolve the division of responsibilities for SOLs and
IROLs or whether some level of sharing of responsibility needs to
exist.
    28. The Commission also proposes to approve the addition of two new
definitions to the NERC Glossary: ``Operational Planning Analysis'' and
``Real-time Assessment'' with limited modification, as discussed below.
Although the proposed definition of Operational Planning Analysis would
permit entities to use an analysis of the expected system conditions
for the next day's operation that was performed up to twelve months
earlier, the discretion to use an existing analysis is limited to
circumstances where the expected system conditions, such as load
forecasts, generation output levels, and known system constraints are
the same for both days. Nevertheless, the Commission requests comments
from NERC and the public on the prudence of using an Operational
Planning Analysis up to twelve months old. We request comment on
whether this timeframe is reasonable or whether the timeframe should be
shorter to ensure that the analysis is not outdated. In addition, the
Commission also seeks comments from NERC and the public on whether the
definition should include measurable criteria needed to determine
whether it is appropriate to use an existing analysis.
    29. In addition, the Commission seeks comment on the meaning of
``immediately available data'' within the proposed definition of Real-
Time Assessment. Requirement R6 of proposed Reliability Standard IRO-
002-2 would require reliability coordinators to have adequate analysis
capabilities such as state estimation, pre- and post-contingency
analysis capabilities (thermal, stability, and voltage), and wide-area
overview displays.\31\ Thus, it appears that any immediately available
data used by the reliability coordinator in the development of a Real-
time Assessment should be data obtained from one of these analysis
capabilities. We believe this could be clearer. Accordingly, under
section 215(d)(5) of the FPA, the Commission proposes to direct NERC to
modify the definition of ``Real-time Assessment'' to specify that the
type of data to be relied upon by a reliability coordinator in
conducting a Real-time Assessment must be based on adequate analysis
capabilities such as those referenced in Requirement R6 of IRO-002-2
when the tools are available.
---------------------------------------------------------------------------

    \31\ As discussed below, NERC proposes to revise IRO-002-1 by
removing one provision, Requirement R2. Thus, Requirement R6 of
proposed IRO-002-2 is the same as Requirement R7 of the existing
version 1 Reliability Standard.
---------------------------------------------------------------------------

2. IRO-009-1
    30. As proposed, Reliability Standard IRO-009-1 is designed to
prevent instability, uncontrolled separation, or cascading outages that
adversely impact the reliability of the interconnection by ``ensuring
prompt action to prevent or mitigate instances of exceeding [IROLs].''
Proposed Reliability Standard IRO-009-1 applies only to reliability
coordinators.
    31. For each IROL that the reliability coordinator identifies one
or more days in advance, the reliability coordinator must, under
Requirements R1 and R2, have one or more operating processes,
procedures, or plans that identify actions it shall take that can be
implemented in time to prevent exceeding those IROLs and to mitigate
the magnitude and duration of exceeding that IROL such that the IROL is
alleviated within the maximum time duration allowed for a violation of
an IROL. Reliability Standard IRO-009-1 refers to the maximum response
period for alleviating an IROL as its ``IROL Tv.'' \32\ Under
Requirements R3 and R4, the reliability coordinator must use those
operating processes, procedures, or plans to prevent and mitigate
IROLs. If reliability coordinators cannot agree on the value for an
IROL or its IROL Tv, Requirement R5 would require each reliability
coordinator that monitors that facility to use the most conservative
value.
---------------------------------------------------------------------------

    \32\ The NERC Glossary of Terms defines ``IROL Tv'' as:
    The maximum time that an Interconnection Reliability Operating
Limit can be violated before the risk to the interconnection or
other Reliability Coordinator Areas becomes greater than acceptable.
Each Interconnection Reliability Operating Limit's Tv shall be less
than or equal to 30 minutes.
---------------------------------------------------------------------------

NOPR Proposal
    32. The Commission agrees that having action plans developed and
implemented with respect to IROLs to prevent instability, uncontrolled
separation, or cascading outages that adversely impact the reliability
of the interconnection increases the likelihood that reliability
coordinators will take appropriate action. Accordingly, under section
215(d)(2) of the FPA, the Commission proposes to approve Reliability
Standard IRO-009-1, as just, reasonable, not unduly discriminatory or
preferential, and in the public interest. However, as discussed above,
the Commission requests comment on the extent that reliability
coordinators should have action plans developed and implemented with
respect to other SOLs apart from IROLs and if so, which SOLs.
3. IRO-010-1a
    33. NERC proposes the addition of a new Reliability Standard, IRO-
010-1a to the current suite of IRO Reliability Standards. IRO-010-1a is
designed to prevent instability, uncontrolled separation, or cascading
outages that adversely impact the reliability of the interconnection by
mandating that the reliability coordinator have the data it needs to
monitor and assess the operation of its reliability coordinator Area.
    34. The requirements in the Reliability Standard specify a formal
request process for the reliability coordinator to explicitly identify
the data and information it needs for reliability; and require the
entities with the data to provide it as requested. The Reliability
Standard applies to the reliability coordinator and to the other
functional entities that must supply data to the reliability
coordinator.\33\ This includes entities that have been identified as
owners, users, or operators of the bulk-power system.
---------------------------------------------------------------------------

    \33\ The requirements in the standard are specifically
applicable to the following functional entities: (1) Reliability
coordinator; (2) balancing authority; (3) generator owner; (4)
generator operator; (5) interchange authority; (6) load-serving
entity; (7) transmission operator; and (8) transmission owner.
---------------------------------------------------------------------------

    35. Because the interpretation for IRO-010-1 was completed before
the filing of IRO-010-1, NERC requests Commission approval of IRO-010-
1a, which includes the standard as interpreted. The WECC Reliability
Coordination Subcommittee requested clarification on: (1) The type of
data to be supplied to the reliability coordinator; (2) which entities
are ultimately responsible for ensuring data are provided; and (3) what
actions are expected of the reliability coordinator regarding a
``mutually acceptable format.''
    36. In response to the questions posed by the WECC Reliability
Coordination Subcommittee, NERC's interpretation team clarified that
the data to be supplied in Requirement R3 applies to the documented
specification for data and information referenced in Requirement R1.
They also explained that the intent of Requirement R3 is for each
responsible entity to ensure that its data and information (as stated
in the documented specification in

Requirement R1) are provided to the reliability coordinator. NERC's
interpretation team stated that another entity may provide that data or
information to the reliability coordinator on behalf of the responsible
entity, but the responsibility remains with the responsible entity.
Finally, they explained that Requirement R1.2 mandates that the parties
will reach a mutual agreement with respect to the format of the data
and information. If the parties can not mutually agree on the format,
it is expected that they will negotiate to reach agreement or enter
into dispute resolution to resolve the disagreement.\34\
---------------------------------------------------------------------------

    \34\ NERC Petition at 108.
---------------------------------------------------------------------------

NOPR Proposal
    37. Under section 215(d)(2) of the FPA, the Commission proposes to
approve Reliability Standard IRO-010-1a, including the proposed
interpretation, as just, reasonable, not unduly discriminatory or
preferential, and in the public interest. However, the Commission notes
that the requirements of Reliability Standard IRO-010-1a do not require
reliability coordinators to specify a list of minimum data needed for
reliable operation of the Bulk-Power System. The Commission is
concerned that, without such a minimum list, neighboring reliability
coordinators could experience problems regarding compatibility and,
therefore, common understanding of data. For example, if differing data
requirements were specified by adjacent reliability coordinators, the
analysis performed by one could indicate a more severe result from a
possible contingency and result in conflicting operating procedures for
mitigation of risk to the Bulk-Power System. Therefore, the Commission
requests comments from the ERO and industry on whether a minimum list
of data is necessary for the effective sharing of data between
neighboring reliability coordinators and, if so, what data should be
included. The Commission also requests comments from NERC and the
industry on how compatibility of data between neighboring reliability
coordinators can be assured absent a list of minimum data as part of
this proposed Reliability Standard.

C. Proposed Revised Reliability Standards

1. EOP-001-1
    38. NERC proposes to retire Requirement R2 of Reliability Standard
EOP-001-0. To implement this revision, NERC proposes a revised
Reliability Standard EOP-001-1. The purpose of EOP-001-1 is to require
each transmission operator and balancing authority to develop,
maintain, and implement a set of plans to mitigate operating
emergencies. These plans need to be coordinated with other transmission
operators and balancing authorities, and the reliability coordinator.
Revised Reliability Standard EOP-001-1 would apply only to balancing
authorities and transmission operators.
    39. NERC contends that, upon IRO-009-1 becoming effective,
Requirement R2 of EOP-001-0 should be retired. Under Requirement R2
transmission operators must have an emergency load reduction plan for
all identified IROLs. NERC contends that this requirement would no
longer be appropriate upon IRO-009-1 becoming effective because the
reliability coordinator, not the transmission operator, is responsible
for developing plans for mitigating IROLs. Accordingly, NERC requests
approval of EOP-001-1, which is identical to existing Reliability
Standard EOP-001-0 except for the retirement of Requirement R2.
    40. NERC contends that the proposed new Requirements R1 and R2 of
IRO-009-1 combined with the revisions in proposed Reliability Standard
EOP-001-1 address the Commission's directives in Order No. 693 to
modify EOP-001-0 to include the reliability coordinator as an
applicable entity and to require the reliability coordinator to act to
mitigate IROL violations within 30 minutes.\35\ In developing IRO-009-
1, NERC states that the drafting team determined that there are some
IROLs that must be resolved in a time frame that is shorter than 30
minutes. Accordingly, Requirement R2 of IRO-009-1 requires that each
action plan developed to resolve an IROL must be capable of being
executed such that the IROL is relieved within its IROL Tv. In
addition, Requirement R4 of IRO-009-1 requires the reliability
coordinator to act, without delay, when actual system conditions show
that there is an instance of exceeding an IROL.
---------------------------------------------------------------------------

    \35\ Order No. 693, FERC Stats. & Regs. ] 31,242 at P 548, 556,
566.
---------------------------------------------------------------------------

NOPR Proposal
    41. Under section 215(d)(2) of the FPA, the Commission proposes to
approve Reliability Standard EOP-001-1 as just, reasonable, not unduly
discriminatory or preferential, and in the public interest. The
Commission also proposes to find that the ERO has satisfied the first
and second directives from P 566 of Order No. 693.\36\
---------------------------------------------------------------------------

    \36\ The Commission notes that the third and fourth directives
listed in P 566 of Order No. 693 remain outstanding. Further, the
Commission directed the ERO to consider a pilot program for
implementing system states. Order No. 693, FERC Stats. & Regs. ]
31,242 at P 566.
---------------------------------------------------------------------------

2. IRO-002-2
    42. NERC proposes to retire Requirement R2 of Reliability Standard
IRO-002-1. To implement this revision, NERC requests Commission
approval of revised Reliability standard IRO-002-2. The purpose of IRO-
002-2 is to provide reliability coordinators with the information,
tools and other capabilities that they need to perform their
responsibilities. IRO-002-2 would apply only to reliability
coordinators.
    43. Requirement R2 of IRO-002-1 requires each reliability
coordinator to determine the data requirements to support its
reliability coordinator tasks and to request such data from its
transmission operators, balancing authorities, transmission owners,
generation owners, generation operators, and load-serving entities, or
adjacent reliability coordinators. NERC explains that proposed
Reliability Standard IRO-010-1a (discussed above) requires the
reliability coordinator to develop and distribute a data specification
to ensure that entities provide data as needed to support monitoring,
analyses, and assessments. NERC contends that the proposed requirements
are more explicit than the associated requirement in Reliability
Standard IRO-002-1.
    44. Reliability Standard IRO-002-2 continues to require each
reliability coordinator to monitor SOLs other than IROLs both within
its reliability coordinator area and in surrounding reliability
coordinator areas. Under Requirement R4 of IRO-002-2, each reliability
coordinator must have detailed real-time monitoring capability of its
reliability coordinator area and sufficient monitoring capability of
its surrounding reliability coordinator areas to ensure that potential
or actual SOLs or IROL violations are identified. In addition, under
Requirement R5, each reliability coordinator must monitor bulk electric
system elements such as generators, transmission lines, buses,
transformers and breakers that could result in SOL or IROL violations
within its reliability coordinator area.
    45. In Order No. 693, the Commission directed the ERO to develop a
modification to IRO-002-1 that requires a minimum set of capabilities
that should be made available to reliability coordinators. NERC
acknowledges that the proposed modification does not

address this directive. NERC states that this directive is being
considered in Project 2009-02--Real-time Tools and Analysis
Capabilities.
NOPR Proposal
    46. Under section 215(d)(2) of the FPA, the Commission proposes to
approve Reliability Standard IRO-002-2. The Commission proposes to find
that the data specification requirements of proposed Reliability
Standard IRO-001-1a are more explicit than the direction provided in
Requirement R2 of IRO-002-1. In addition, the Commission accepts NERC's
commitment to develop a minimum set of capabilities that should be made
available to reliability coordinators.
3. IRO-004-2
    47. NERC proposes to revise IRO-004-1 by retiring Requirements R1
through R6. To implement these revisions, NERC requests Commission
approval of Reliability Standard IRO-004-2. The purpose of IRO-004-2 is
to require each reliability coordinator to conduct next-day reliability
analyses for its reliability coordinator area to ensure the bulk
electric system can be operated reliably in anticipated normal and
contingency conditions. IRO-004-2 would apply to balancing authorities,
transmission operators, and transmission service providers.
    48. NERC states that, upon approval of proposed IRO-008-1,
Requirement R1 of the currently-effective IRO-004-1 should be retired
because the requirement only requires a next-day reliability analysis
of its own reliability coordinator area as opposed to its Wide-Area,
which also would include critical flow and status information from
adjacent reliability coordinator areas to allow the calculation of
IROLs. NERC explains that because proposed IRO-008-1 requires the
reliability coordinator to assess a wider area than is currently
required by IRO-004-1, the reliability coordinator is required to
continuously look beyond its own area boundaries and assess a broader
portion of the interconnected Bulk-Power System. NERC further states
that the purpose of conducting a day-ahead analysis is not to
``ensure'' but to ``assess'' the system and, thus, Requirement R1 of
currently-effective IRO-004-1 is inaccurate.
    49. NERC also seeks to retire Requirement R2 of IRO-004-1, which
requires each reliability coordinator to ``pay particular attention to
parallel flows to ensure one reliability coordinator area does not
place an unacceptable or undue burden on an adjacent reliability
coordinator area.'' \37\ NERC states that the phrase ``to pay
particular attention to'' is neither clear nor measurable. NERC asserts
that the requirements in currently-effective IRO-014, IRO-015, and IRO-
016 are aimed at ensuring that reliability coordinators coordinate
their actions with one another and act in the best interest of the
interconnection as a whole. In addition, NERC explains that, under the
Functional Model, the transmission operator is responsible for the
real-time operation of the transmission system with the reliability
coordinator providing oversight of the transmission operator's actions,
directing additional or alternate actions when needed. NERC states that
the requirements proposed in the new IRO Reliability Standards focus
specifically on IROLs and are inclusive of any reliability implications
due to parallel flows.
---------------------------------------------------------------------------

    \37\ Reliability Standard IRO-004-1, Requirement R2.
---------------------------------------------------------------------------

    50. In support of retiring Requirements R1 and R2 of IRO-004-1,
NERC posits that under the Functional Model, the reliability
coordinator is the functional entity with primary responsibility for
IROLs and the transmission operator is the functional entity with
primary responsibility for SOLs. NERC states that, under certain
circumstances, the transmission operator may request the assistance of
its reliability coordinator in developing an SOL but the responsibility
for addressing the SOL remains with the transmission operator.\38\ NERC
explains that, under the Functional Model and Requirement R11 of
Reliability Standard TOP-002-2, the transmission operator is
responsible for conducting analyses to identify where there may be
instances of exceeding SOLs. NERC also states that, under TOP-008-1,
the transmission operator is responsible for taking actions to either
prevent or mitigate instances of exceeding SOLs. NERC states that, by
contrast, it is the reliability coordinator that is responsible for
ensuring that IROLs are developed for its reliability coordinator area
in accordance with a methodology developed by the reliability
coordinator. Further, NERC states that the transmission operator must
share its SOLs with its reliability coordinator, and the reliability
coordinator must share any SOLs it develops with its transmission
operator. NERC states that the reliability coordinator monitors the
status of some, but not all, SOLs.
---------------------------------------------------------------------------

    \38\ See Reliability Standard TOP-008-1, requiring transmission
operators to take action to prevent or mitigate violations of SOLs.
---------------------------------------------------------------------------

    51. NERC also contends that, upon proposed Reliability Standard
IRO-009-1 becoming effective, Requirements R3 and R6 of currently-
effective IRO-004-0 should be retired. Under Requirement R3 of IRO-004-
0, reliability coordinators must, in conjunction with its transmission
operators and balancing authorities, develop action plans, including
for reducing load to return transmission loading to within acceptable
SOLs or IROLs. NERC states that the use of the phrase, ``in conjunction
with'' is not supported by the responsibilities of the reliability
coordinator in the Functional Model and would be inconsistent with the
requirements of proposed Reliability Standard IRO-009-1. NERC also
states that proposed Requirement R3 of IRO-009-1 includes language that
is more explicit than the language in Requirement R6 of existing
Reliability Standard IRO-004-1.
    52. Finally, NERC proposes to retire Requirements R4 and R5 from
IRO-004-1. Requirement R4 requires each transmission operator,
balancing authority, transmission owner, generator owner, generator
operator, and load-serving entity in the reliability coordinator area
to provide information required for system studies. NERC proposes to
retire Requirement R4 because it identifies only a fraction of the
reliability-related data needed by the reliability coordinator.
Requirement R5 requires each reliability coordinator to share the
results of its system studies with other reliability coordinators and
transmission operators, balancing authorities, and transmission service
providers within its reliability coordinator area. NERC states that
proposed Reliability IRO-010-1a offers a suitable replacement for
currently-effective Requirements R4 and R5 because IRO-010-1a requires
reliability coordinators to know, in advance, what data and information
it needs and what data and information it needs to share with other
reliability entities. In addition, requirement R3 of proposed
Reliability Standard IRO-008-1 would require the reliability
coordinator to share the results of its analyses with entities within
its reliability coordinator area.
NOPR Proposal
    53. Under section 215(d)(2) of the FPA, the Commission proposes to
approve Reliability Standard IRO-004-2, as just, reasonable, not unduly
discriminatory or preferential, and in the public interest. The
Commission recognizes NERC's efforts to more clearly define which
functional entity has the ultimate responsibility for SOLs

and IROLs, and to synchronize existing standards with the proposed new
IRO Reliability Standards. We propose to find that the requirements
proposed for retirement from IRO-004-1 are appropriately addressed in
new Reliability Standards IRO-008-1, IRO-009-1, and IRO-010-1a.
4. IRO-005-3
    54. NERC proposes to retire Requirement R2, R3, R5, R16, and R17 of
currently-effective Reliability Standard IRO-005-2, and to modify
Requirements R9, R13, and R14. To implement these revisions, NERC
requests Commission approval of proposed Reliability Standard IRO-005-
3. The purpose of proposed Reliability Standard IRO-005-3 is to require
the reliability coordinator to be continuously aware of conditions
within its reliability coordinator area and include this information in
its reliability assessments. In addition, the reliability coordinator
must monitor the bulk electric system parameters that may have
significant impacts upon the reliability coordinator area and
neighboring reliability coordinator areas. IRO-005-3 would apply to
reliability coordinators, balancing authorities, transmission
operators, transmission service providers, generator operators, load-
serving entities, and purchasing-selling entities.
    55. NERC contends that, upon the new IRO Reliability Standards
becoming effective, Requirements R2, R3, R5, R16, and R17 of IRO-005-2
should be retired and Requirements R9, R13, and R14 should be modified.
Except for Requirement R2, all of the requirements proposed for
retirement set responsibilities for the reliability coordinator to be
continuously aware of SOLs and IROLs within its reliability coordinator
area and to identify the cause for each SOL and IROL. Similarly, all of
the requirements proposed for modification include requirements for the
reliability coordinator to address SOLs and for the transmission
operator to address IROLs. NERC contends that these existing
requirements should be retired or modified in light of the division of
responsibilities between reliability coordinators and transmission
operators expressed in new Reliability Standard IRO-009-1.
    56. Requirement R2 requires the reliability coordinator ``to be
aware of'' all interchange transactions that wheel through its
reliability coordinator area. NERC contends that it is not possible to
measure how an entity is ``aware of'' specific information. In
addition, NERC states that the e-tag system that has been implemented
no longer requires the reliability coordinator to collect and relay
interchange information to other entities. If a reliability coordinator
needs this information, NERC states that the reliability coordinator
can add this item to the list of data and information on its data
specification under proposed Requirement R1 of IRO-010-1a.
NOPR Proposal
    57. Under section 215(d)(2) of the FPA, the Commission proposes to
approve Reliability Standard IRO-005-3, as just, reasonable, not unduly
discriminatory or preferential, and in the public interest. The
Commission recognizes NERC's efforts to more clearly define which
functional entity has the ultimate responsibility for SOLs and IROLs,
and to synchronize existing standards with the proposed new IRO
Reliability Standards. We propose to find that the requirements of IRO-
005-2 proposed for retirement and modification are appropriately
addressed in new Reliability Standards IRO-008-1, IRO-009-1, and IRO-
010-1a.
5. TOP-003-1
    58. NERC proposes to modify Requirement R1.2 of currently-effective
Reliability Standard TOP-003-0. To implement this revision, NERC
requests approval of proposed Reliability Standard TOP-003-1. The
purpose of TOP-003-1 is to require balancing authorities, transmission
operators, and reliability coordinators to plan and coordinate
scheduled generator and transmission outages that may affect the
reliability of interconnected operations. TOP-003-1 would apply to
generator operators, transmission operators, balancing authorities, and
reliability coordinators.
    59. NERC explains that Requirement R1.2 of TOP-003-0 includes two
distinct activities--a requirement for the transmission operator to
provide the reliability coordinator and other entities with daily
outage information and a requirement for the reliability coordinator to
establish outage reporting requirements. NERC contends that both
elements of Requirement R1.2 are captured in proposed Reliability
Standard IRO-010-1a. NERC proposes to remove the transmission
operator's obligation to provide daily outage information to
reliability coordinators and strike the requirement for the reliability
coordinator to establish outage reporting requirements.
    According to NERC, Requirement R1 of proposed IRO-010-1a requires
the reliability coordinator to specify what data and information it
needs, as well as the frequency and format for providing that data and
information. NERC states that, because the reliability coordinator
needs outage data for modeling and analysis, the specification will
include outage data. Requirement R3 of IRO-010-1a requires entities to
provide data and information to the reliability coordinator in
accordance with the reliability coordinator's specifications. NERC
states that if TOP-003-0 Requirement R1.2 is not modified, it will be
redundant with IRO-010-1a, Requirement R3.
NOPR Proposal
    60. Under section 215(d)(2) of the FPA, we propose to approve
Reliability Standard TOP-003-1, as just, reasonable, not unduly
discriminatory or preferential, and in the public interest. We propose
to find that the requirements of currently-effective Reliability
Standard TOP-003-0 that NERC proposed for modification are
appropriately addressed in new Reliability Standard IRO-010-1a.
However, under Requirement R3, it is incumbent on the reliability
coordinator to request sufficient scheduled outage data. The Commission
is concerned that IRO-010-1a does not specify outage coordination data
and the reliability coordinator may not receive adequate outage
coordination data to support the Operational Planning Analysis.
Therefore, the Commission seeks comments from NERC and the public on
whether IRO-010-1a should specify the necessary outage coordination
data.
6. TOP-005-2
    61. NERC proposes to retire Requirements R1 and R1.1 of currently-
effective Reliability Standard TOP-005-1 and modify Attachment 1 of the
Reliability Standard. To implement these revisions, NERC requests
approval of proposed Reliability Standard TOP-005-2. The purpose of
TOP-005-2 is to ensure reliability entities have the operating data
needed to monitor system conditions within their areas. TOP-005-2 would
apply to transmission operators, balancing authorities, and purchasing
selling entities.
    62. Requirement R1 of TOP-005-1 requires transmission operators to
provide the reliability coordinator with the data and information that
the reliability coordinator needs to perform its reliability-related
tasks. Requirement R1.1 of TOP-005-1 requires reliability coordinators
to identify the data requirements, listed in Attachment 1 of TOP-005-1,
and any additional operating information requirements relating to the
operation of the Bulk-Power System with its reliability

coordinator area. NERC states that Requirement R1 implies that the
reliability coordinator will limit its use of the data and information
it collects to operations within its reliability coordinator area.
According to NERC, this does not support the Functional Model, which
requires the reliability coordinator to monitor the Wide-Area. NERC
states that, under other Reliability Standards such as IRO-014-1 and
IRO-015-1, each reliability coordinator is expected to coordinate the
activities within its reliability coordinator area with other
reliability coordinators.
    63. NERC states that, under proposed Reliability Standard IRO-010-
1a, each reliability coordinator must document what data and
information it needs and which entities must provide that data. NERC
explains that the reliability coordinator needs this data to perform
reliability assessments and for real-time monitoring. Under the
Functional Model, the reliability coordinator collects data and
information not just from transmission operators and balancing
authorities, but also from generator operators, load-serving entities,
transmission owners, and generator owners.
    64. NERC also proposes conforming revisions to Attachment 1 to TOP-
005-2. As currently written, Attachment 1 of TOP-005-1 lists the types
of data that reliability coordinators, balancing authorities, and
transmission operators are expected to provide, and are expected to
share with each other. Consistent with the proposed revisions in
Reliability Standard TOP-005-2, NERC proposes to remove references to
the reliability coordinator from Attachment 1.
NOPR Proposal
    65. Under section 215(d)(2) of the FPA, the Commission proposes to
approve Reliability Standard TOP-005-2, as just, reasonable, not unduly
discriminatory or preferential, and in the public interest. The
Commission recognizes NERC's efforts to more clearly define the
reliability coordinator's need to know, in advance, what data is
needed, insure the timely availability of the data; and how that data
will be communicated to other functional entities. We propose to find
that the requirements of TOP-005-1 that are proposed for retirement are
appropriately addressed in new Reliability Standard IRO-010-1a. We are
concerned, however, about whether the proposal adequately ensures the
compatibility of data between neighboring reliability coordinators.
Having compatible data allows for an essential level of
interoperability. The Commission requests comment from the reliability
coordinators and the industry on whether a list of minimum ``Electric
System Reliability Data,'' such as shown in Attachment 1 of currently-
effective Reliability Standard TOP-005-1, is beneficial for reliability
coordinators to meet the requirements of IRO-008-1 and IRO-009-1.
7. TOP-006-2
    66. NERC proposes to modify Requirement R4 of currently-effective
Reliability Standard TOP-006-1. To implement this revision, NERC
requests approval of proposed Reliability Standard TOP-006-2. The
purpose of TOP-006-2 is to ensure critical reliability parameters are
monitored in real-time. Its requirements would be applicable to
transmission operators, balancing authorities, generator operators, and
reliability coordinators.
    67. Requirement R4 of TOP-006-1 requires each reliability
coordinator, transmission operator, and balancing authority to have
information, including weather forecasts and past load patterns,
available to predict the system's near-term load pattern. NERC proposes
to modify Requirement R4 by removing the reference to reliability
coordinators. NERC states that the information identified in existing
Requirement R4 of TOP-006-1 is not inclusive, and is addressed more
globally for the reliability coordinator in Requirements R1 and R3 of
the proposed new Reliability Standard IRO-010-1a. Proposed Requirement
R1 of IRO-010-1a requires each reliability coordinator to have a
documented specification for data and information to build and maintain
models to support real-time monitoring, operational planning analyses,
and real-time assessments of its reliability coordinator area to
prevent instability, uncontrolled separation, and cascading outages.
Requirement R3 of IRO-010-1a requires each balancing authority,
generator owner, generator operator, interchange authority, load-
serving entity, reliability coordinator, transmission operator, and
transmission owner to provide data and information, as specified, to
their reliability coordinator.
NOPR Proposal
    68. Under section 215(d)(2) of the FPA, the Commission proposes to
approve Reliability Standard TOP-006-2, as just, reasonable, not unduly
discriminatory or preferential, and in the public interest. The
Commission recognizes NERC's efforts to more clearly define the
reliability coordinator's need to know, in advance, what load forecast
data is needed, the supporting data for the load forecast; and how that
data will communicated to other functional entities. We propose to find
that the reliability coordinator functions that are removed from
Requirement R4 of TOP-006-2 are appropriately addressed in Requirements
R1 and R3 of new Reliability Standard IRO-010-1a.

D. Violation Severity Levels and Violation Risk Factors

    69. In the event of a violation of a Reliability Standard, NERC
will establish the initial value range for the corresponding base
penalty amount. To do so, NERC will assign a violation risk factor for
each requirement of a Reliability Standard that relates to the expected
or potential impact of a violation of the requirement on the
reliability of the Bulk-Power System. In addition, NERC will define up
to four violation severity levels--Lower, Moderate, High, and Severe--
as measurements for the degree to which the requirement was violated in
a specific circumstance.
    70. In Order No. 705, the Commission approved 63 of NERC's 72
proposed violation risk factors for the version one FAC Reliability
Standards and directed NERC to file violation severity level
assignments before the version one FAC Reliability Standards become
effective.\39\ Subsequently, NERC developed violation severity levels
for each requirement of the Commission-approved FAC Reliability
Standards, as measurements for the degree to which the requirement was
violated in a specific circumstance.
---------------------------------------------------------------------------

    \39\ Facilities Design, Connections and Maintenance Reliability
Standards, Order No. 705, 121 FERC ] 61,296, at P 137 (2007).
---------------------------------------------------------------------------

    71. On June 19, 2008, the Commission issued its Violation Severity
Level Order approving the violation severity level assignments filed by
NERC for the 83 Reliability Standards approved in Order No. 693.\40\ In
that order, the Commission offered four guidelines for evaluating the
validity of violation severity levels, and ordered a number of reports
and further compliance filing to bring the remainder of NERC's
violation severity levels into conformance with the Commission's
guidelines. The four guidelines are: (1) Violation severity level
assignments should not have the unintended consequence of lowering the
current level of compliance; (2) violation severity level assignments
should ensure uniformity and consistency among all approved Reliability
Standards in the

determination of penalties; \41\ (3) violation severity level
assignments should be consistent with the corresponding requirement;
and (4) violation severity level assignments should be based on a
single violation, not a cumulative number of violations.\42\ The
Commission found that these guidelines will provide a consistent and
objective means for assessing, inter alia, the consistency, fairness
and potential consequences of violation severity level assignments. The
Commission noted that these guidelines were not intended to replace
NERC's own guidance classifications, but rather, to provide an
additional level of analysis to determine the validity of violation
severity level assignments.
---------------------------------------------------------------------------

    \40\ Violation Severity Level Order, 123 FERC ] 61,284.
    \41\ Guideline 2 contains two sub-parts: (a) The single
violation severity level assignment category for binary requirements
should be consistent and (b) violation severity levels assignments
should not contain ambiguous language.
    \42\ Violation Severity Level Order, 123 FERC ] 61,284 at P 17.
---------------------------------------------------------------------------

    72. On August 10, 2009, NERC submitted an informational filing
setting forth a summary of revised guidelines that NERC intends to use
in determining the assignment of violation risk factors and violation
severity levels for Reliability Standards. NERC states that these
revised guidelines were consistent with Commission's guidelines. On May
5, 2010, NERC submitted the subject informational filing as a
supplement to its March 5, 2010 Violation Severity Level Order
compliance filing.\43\
---------------------------------------------------------------------------

    \43\ North American Reliability Corporation, Filing of the North
American Electric Reliability Corporation regarding the Assignment
of Violation Risk Factors and Violation Severity Levels, Docket No.
RR08-4-005 (filed May 5, 2010).
---------------------------------------------------------------------------

NERC Proposal
    73. NERC proposes a complete set of violation severity levels and
violation risk factors for proposed new Reliability Standards IRO-008-
1, IRO-009-1, and IRO-010-1a. In addition, NERC proposes to apply the
existing set of violation severity levels and violation risk factors
assigned to the proposed modified requirements.
    74. NERC states that it developed the violation severity levels for
the new IRO Reliability Standards before the Commission issued its June
19, 2008 order on violation severity levels.\44\ NERC also notes that
the proposed violation severity levels were developed before NERC
proposed a new methodology for assigning violation severity levels and
violation risk factors.\45\ As a result, NERC states that some of the
proposed violation severity levels do not comport with the Commission's
guidelines on violation severity levels and some do not comport with
the NERC's revised guidelines. NERC has identified differences and
commits to propose revisions to the violation severity levels.
---------------------------------------------------------------------------

    \44\ Id.
    \45\ NERC, Informational Filing Regarding the Assignment of
Violation Risk Factors and Violation Severity Levels, Docket Nos.
RM08-11-000, RR07-9-000, and RR07-10-000, (filed Aug. 10, 2009).
---------------------------------------------------------------------------

NOPR Proposal
    75. The Commission proposes to accept the proposed violation risk
factors and violation severity levels presented in NERC's petition. In
addition, we propose to accept NERC's commitment to review the proposed
violation risk factors and violation severity levels to ensure
compliance with the Commission's guidelines. Accordingly, we propose to
direct NERC to submit a compliance filing within six months of the
effective date of the final rule in this proceeding that would provide
the results of NERC's review including any modifications necessary to
comply with the Commission's guidelines on violation risk factors and
violation severity levels.
    76. The violation risk factors and violation severity levels for
proposed new Reliability Standards IRO-008-1, IRO-009-1, and IRO-010-
1a, and the proposed modified requirements also would be impacted by
NERC's revised guidelines for assigning violation severity levels
currently pending before the Commission in Docket No. RR08-4-005.
Subject to Commission action on NERC's revised guidelines, NERC may
need to make additional revisions to the proposed violation risk
factors and violation severity levels.

III. Information Collection Statement

    77. The Office of Management and Budget (OMB) regulations require
approval of certain information collection requirements imposed by
agency rules.\46\ Upon approval of a collection(s) of information, OMB
will assign an OMB control number and an expiration date. Respondents
subject to the filing requirements of this rule will not be penalized
for failing to respond to these collections of information unless the
collections of information display a valid OMB control number. The
Paperwork Reduction Act (PRA) \47\ requires each federal agency to seek
and obtain OMB approval before undertaking a collection of information
directed to ten or more persons, or continuing a collection for which
OMB approval and validity of the control number are about to
expire.\48\
---------------------------------------------------------------------------

    \46\ 5 CFR 1320.11.
    \47\ 44 U.S.C. 3501-20.
    \48\ 44 U.S.C. 3502(3)(A)(i), 44 U.S.C. 3507(a)(3).
---------------------------------------------------------------------------

    78. The Commission is submitting these reporting and recordkeeping
requirements to OMB for its review and approval under section 3507(d)
of the PRA. Comments are solicited on the Commission's need for this
information, whether the information will have practical utility, the
accuracy of provided burden estimates, ways to enhance the quality,
utility, and clarity of the information to be collected, and any
suggested methods for minimizing the respondent's burden, including the
use of automated information techniques.
    79. This NOPR proposes to approve three new Reliability Standards,
IRO-008-1, IRO-009-1 and IRO-010-1a governing reliability coordinator
analyses, operational actions and data collection, which standards will
replace parts of the currently-effective Reliability Standards EOP-001-
0, IRO-002-1, IRO-004-1, IRO-005-2, TOP-003-0, TOP-005-1 and TOP-006-1
approved by the Commission in Order No. 693. Many of the proposed
requirements are based requirements in currently-effective Reliability
Standards and match common industry practice. Thus, this proposed
rulemaking does not impose entirely new burdens on the effected
entities. With the exception of the addition of Interchange Authority
as an applicable entity in IRO-010-1a, the currently-effective
standards EOP-001-0, IRO-002-1, IRO-004-1, IRO-005-2, TOP-003-0, TOP-
005-1 and TOP-006-1 require actions by the same applicable group of
entities. IRO-010-1a clarifies for balancing authorities, generator
owners, generator operators, interchange authorities, load-serving
entities, reliability coordinators, transmission operators, and
transmission owners shall provide data and information, as specified,
to the reliability coordinator(s) with which it has a reliability
relationship.\49\ The requirements of IRO-008-1 and IRO-009-a provide
clarification from existing requirements, dictating the analysis and
operational roles of the reliability coordinator.
---------------------------------------------------------------------------

    \49\ Proposed Reliability Standard IRO-010-1a, Requirement R3.
---------------------------------------------------------------------------

    80. Public Reporting Burden: Our estimate below regarding the
number of respondents is based on the NERC compliance registry as of
September 28, 2010. According to the NERC compliance registry, there
are 134 balancing authorities, 824 generator owners, 773 generator
operators, 61 interchange authorities, 541 load-serving entities, 26
reliability coordinators, 178 transmission operators, and 332
transmission owners

that would be involved in providing information. However, under NERC's
compliance registration program, entities may be registered for
multiple functions, and as such there is some duplication of functions
regarding the number of registered entities that would be required to
provide information. Given these parameters, the Commission estimates
that the Public Reporting burden for the requirements contained in the
NOPR is as follows:

----------------------------------------------------------------------------------------------------------------
                                                                Number of
             Data collection                  Number of          annual           Hours per       Total annual
                                             respondents        responses        respondent           hours
----------------------------------------------------------------------------------------------------------------
FERC-725A
Reliability Coordinators distribution of                26                *1                 8               208
 data specification to entities.........
Balancing Authorities, Generator Owners,             1,501                *1                 8            12,008
 Generator Operators, Interchange
 Authorities, Load-serving Entities,
 Reliability Coordinators, Transmission
 Operators, and Transmission Owners
 reporting data to their Reliability
 Coordinator............................
                                         -----------------------------------------------------------------------
    Total...............................  ................  ................  ................            12,216
----------------------------------------------------------------------------------------------------------------
* As needed.

     Total Annual hours for Collection: (Reporting +
recordkeeping) = hours.
    Information Collection Costs: The Commission seeks comments on the
costs to comply with the reporting and recordkeeping burden associated
with the proposed Reliability Standards. It has projected the average
annualized cost to be the total annual hours
    Recordkeeping = 12,216 hours @ $120/hour = $1,465,920.
     Total costs = $1,465,920.
     Title: Mandatory Reliability Standards for the Bulk-Power
System.
     Action: Proposed Collection of Information.
     OMB Control No: 1902-0244.
     Respondents: Business or other for profit, and/or not for
profit institutions.
     Frequency of Responses: Annually, or as needed.
     Necessity of the Information: This proposed rule would
approve revised Reliability Standards that create new requirements for
reliability coordinator responsibilities. The proposed Reliability
Standards require entities to supply required data and information
needed by the reliability coordinator.
     Internal review: The Commission has reviewed the
requirements pertaining to the proposed Reliability Standards for the
Bulk-Power System and determined that the proposed requirements are
necessary to meet the statutory provisions of the Energy Policy Act of
2005. These requirements conform to the Commission's plan for efficient
information collection, communication and management within the energy
industry. The Commission has assured itself, by means of internal
review, that there is specific, objective support for the burden
estimates associated with the information requirements.
    81. Interested persons may obtain information on the reporting
requirements by contacting: Federal Energy Regulatory Commission, 888
First Street, NE., Washington, DC 20426 [Attention: Ellen Brown, Office
of the Executive Director, Phone:<PHONE_NUMBER>, fax:<PHONE_NUMBER>,
e-mail<EMAIL_ADDRESS>Comments on the requirements of this
order may also be sent to the Office of Information and Regulatory
Affairs, Office of Management and Budget, Washington, DC 20503
[Attention: Desk Officer for the Federal Energy Regulatory Commission].
For security reasons, comments should be sent by e-mail to OMB at
<EMAIL_ADDRESS>Please reference docket number RM10-15-
000 in your submission.

IV. Environmental Analysis

    82. The Commission is required to prepare an Environmental
Assessment or an Environmental Impact Statement for any action that may
have a significant adverse effect on the human environment.\50\ The
actions proposed here fall within the categorical exclusion in the
Commission's regulations for rules that are clarifying, corrective or
procedural, for information gathering, analysis, and dissemination.\51\
Accordingly, neither an environmental impact statement nor
environmental assessment is required.
---------------------------------------------------------------------------

    \50\ Order No. 486, Regulations Implementing the National
Environmental Policy Act, 52 FR 47897 (Dec. 17, 1987), FERC Stats. &
Regs. ] 30,783 (1987).
    \51\ 18 CFR 380.4(a)(5).
---------------------------------------------------------------------------

V. Regulatory Flexibility Act Certification

    83. The Regulatory Flexibility Act of 1980 (RFA) \52\ generally
requires a description and analysis of final rules that will have
significant economic impact on a substantial number of small entities.
The requirements of this rule would apply primarily to reliability
coordinators, which do not fall within the definition of small
entities.\53\ Moreover, the proposed Reliability Standards reflect a
continuation of existing requirements for reliability coordinators and
other entities to monitor, analyze, prevent, and mitigate the
occurrence of operating limit violations on the Bulk-Power System. The
one exception is the proposed new requirements in Reliability Standard
IRO-010-1a for interchange authorities, which also do not fall within
the definition of small entities. Based on the foregoing, the
Commission certifies that this proposed rule will not have a
significant impact on a substantial number of small entities.
Accordingly, no regulatory flexibility analysis is required.
---------------------------------------------------------------------------

    \52\ 5 U.S.C. 601-12.
    \53\ The RFA definition of ``small entity'' refers to the
definition provided in the Small Business Act (SBA), which defines a
``small business concern'' as a business that is independently owned
and operated and that is not dominant in its field of operation. See
15 U.S.C. 632. According to the SBA, a small electric utility is
defined as one that has a total electric output of less than four
million MWh in the preceding year.
---------------------------------------------------------------------------

VI. Comment Procedures

    84. The Commission invites interested persons to submit comments on
the matters and issues proposed in this notice to be adopted, including
any related matters or alternative proposals that commenters may wish
to discuss. Comments are due January 24, 2011. Comments must refer to
Docket No. RM10-15-000, and must include the commenter's name, the
organization they represent, if applicable, and their address in their
comments.
    85. The Commission encourages comments to be filed electronically
via the eFiling link on the Commission's Web site at http://
www.ferc.gov. The Commission accepts most standard word processing
formats. Documents created electronically using word processing
software should be filed in native applications or print-to-PDF

format and not in a scanned format. Commenters filing electronically do
not need to make a paper filing.
    86. Commenters unable to file comments electronically must mail or
hand-deliver an original copy of their comments to: Federal Energy
Regulatory Commission, Secretary of the Commission, 888 First Street,
NE., Washington, DC 20426. These requirements can be found on the
Commission's Web site, see, e.g., the ``Quick Reference Guide for Paper
Submissions,'' available at http://www.ferc.gov/docs-filing/efiling.asp
or via phone from FERC Online Support at<PHONE_NUMBER> or toll-free at
1-866-208-3676.
    87. All comments will be placed in the Commission's public files
and may be viewed, printed, or downloaded remotely as described in the
Document Availability section below. Commenters on this proposal are
not required to serve copies of their comments on other commenters.

VII. Document Availability

    88. In addition to publishing the full text of this document in the
Federal Register, the Commission provides all interested persons an
opportunity to view and/or print the contents of this document via the
Internet through FERC's Home Page (http://www.ferc.gov) and in FERC's
Public Reference Room during normal business hours (8:30 a.m. to 5 p.m.
Eastern time) at 888 First Street, NE., Room 2A, Washington DC 20426.
    89. From FERC's Home Page on the Internet, this information is
available on eLibrary. The full text of this document is available on
eLibrary in PDF and Microsoft Word format for viewing, printing, and/or
downloading. To access this document in eLibrary, type the docket
number excluding the last three digits of this document in the docket
number field.
    90. User assistance is available for eLibrary and the FERC's Web
site during normal business hours from FERC Online Support at (202)
502-6652 (toll free at 1-866-208-3676) or e-mail at
<EMAIL_ADDRESS>or the Public Reference Room at (202) 502-
8371, TTY<PHONE_NUMBER>. E-mail the Public Reference Room at
<EMAIL_ADDRESS>
    By direction of the Commission.
Kimberly D. Bose,
Secretary.
[FR Doc. 2010-29575 Filed 11-23-10; 8:45 am]
BILLING CODE 6717-01-P