[Federal Register Volume 88, Number 165 (Monday, August 28, 2023)]
[Notices]
[Pages 58576-58577]
[FR Doc No: 2023-18487]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. ER23-2668-000]

Richfield Solar Energy LLC; Supplemental Notice That Initial
Market-Based Rate Filing Includes Request for Blanket Section 204
Authorization

    This is a supplemental notice in the above-referenced proceeding of
Richfield Solar Energy LLC's application for market-based rate
authority, with an accompanying rate tariff, noting that such
application includes a request for blanket authorization, under 18 CFR
part 34, of future issuances of securities and assumptions of
liability.
    Any person desiring to intervene or to protest should file with the
Federal Energy Regulatory Commission, 888 First Street NE, Washington,
DC 20426, in accordance with Rules 211 and 214 of the Commission's
Rules of Practice and Procedure (18 CFR 385.211 and 385.214). Anyone
filing a motion to intervene or protest must serve a copy of that
document on the Applicant.
    Notice is hereby given that the deadline for filing protests with
regard to the applicant's request for blanket authorization, under 18
CFR part 34, of future issuances of securities and assumptions of
liability, is September 11, 2023.
    The Commission encourages electronic submission of protests and
interventions in lieu of paper, using the FERC Online links at http://www.ferc.gov. To facilitate electronic service, persons with internet
access who will eFile a document and/or be listed as a contact for an
intervenor must create and validate an eRegistration account using the
eRegistration link. Select the eFiling link to log on and submit the
intervention or protests.
    Persons unable to file electronically may mail similar pleadings to
the Federal Energy Regulatory Commission, 888 First Street NE,
Washington, DC 20426. Hand delivered submissions in docketed
proceedings should be delivered to Health and Human Services, 12225
Wilkins Avenue, Rockville, Maryland 20852.
    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 the Commission's Home Page (http://www.ferc.gov) using
the ``eLibrary'' link. Enter the docket number excluding the last three
digits in the docket number field to access the document. At this time,
the Commission has suspended access to the Commission's Public

Reference Room, due to the proclamation declaring a National Emergency
concerning the Novel Coronavirus Disease (COVID-19), issued by the
President on March 13, 2020. For assistance, contact the Federal Energy
Regulatory Commission at [email protected] or call toll-free,
(886) 208-3676 or TYY,<PHONE_NUMBER>.
    The Commission's Office of Public Participation (OPP) supports
meaningful public engagement and participation in Commission
proceedings. OPP can help members of the public, including landowners,
environmental justice communities, Tribal members and others, access
publicly available information and navigate Commission processes. For
public inquiries and assistance with making filings such as
interventions, comments, or requests for rehearing, the public is
encouraged to contact OPP at<PHONE_NUMBER> or [email protected].

    Dated: August 22, 2023.
Debbie-Anne A. Reese,
Deputy Secretary.
[FR Doc. 2023-18487 Filed 8-25-23; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register Volume 81, Number 229 (Tuesday, November 29, 2016)]
[Notices]
[Page 86048]
[FR Doc No: 2016-28772]

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SECURITIES AND EXCHANGE COMMISSION

Sunshine Act Meeting

    Notice is hereby given, pursuant to the provisions of the
Government in the Sunshine Act, Public Law 94-409, that the Securities
and Exchange Commission will hold a closed meeting on Thursday,
December 1, 2016 at 12 p.m.
    Commissioners, Counsel to the Commissioners, the Secretary to the
Commission, and recording secretaries will attend the closed meeting.
Certain staff members who have an interest in the matters also may be
present.
    The General Counsel of the Commission, or her designee, has
certified that, in her opinion, one or more of the exemptions set forth
in 5 U.S.C. 552b(c)(3), (5), (7), 9(B) and (10) and 17 CFR
200.402(a)(3), (a)(5), (a)(7), (a)(9)(ii) and (a)(10), permit
consideration of the scheduled matter at the closed meeting.
    Chair White, as duty officer, voted to consider the items listed
for the closed meeting in closed session, and determined that no
earlier notice thereof was possible.
    The subject matter of the closed meeting will be:

    Institution and settlement of injunctive actions;
    Institution and settlement of administrative proceedings;
    Resolution of litigation claims; and
    Other matters relating to enforcement proceedings.

    At times, changes in Commission priorities require alterations in
the scheduling of meeting items.
    For further information and to ascertain what, if any, matters have
been added, deleted or postponed; please contact Brent J. Fields from
the Office of the Secretary at<PHONE_NUMBER>.

    Dated: November 23, 2016.
Brent J. Fields,
Secretary.
[FR Doc. 2016-28772 Filed 11-25-16; 11:15 am]
 BILLING CODE 8011-01-P


[Federal Register: May 17, 2010 (Volume 75, Number 94)]
[Notices]
[Page 27606-27608]
[DOCID:fr17my10-105]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-62064; File No. SR-FINRA-2010-020]

Self-Regulatory Organizations; Financial Industry Regulatory
Authority, Inc.; Notice of Filing and Immediate Effectiveness of
Proposed Rule Change Relating to the Trade Reporting Facility Limited
Liability Company Agreements

May 10, 2010.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on April 27, 2010, the Financial Industry Regulatory Authority, Inc.
(``FINRA'') (f/k/a National Association of Securities Dealers, Inc.
(``NASD'')) filed with the Securities and Exchange Commission (``SEC''
or ``Commission'') the proposed rule change as described in Items I, II
and III below, which Items have been prepared by FINRA. FINRA has
designated the proposed rule change as being concerned solely with the
administration of the self-regulatory organization under Section
19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-4(f)(3) thereunder,\4\
which renders the proposal effective upon receipt of this filing by the
Commission. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 17 CFR 240.19b-4(f)(3).

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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    FINRA is proposing to make technical changes to the Trade Reporting
Facility limited liability company agreements, as they appear in the
FINRA Manual, to reflect that the agreements were amended and restated
following the formation of FINRA through the consolidation of NASD and
the member regulatory functions of NYSE Regulation. The proposed rule
change does not require amendments to any FINRA rules.
    The text of the proposed rule change is available on FINRA's Web
site at http://www.finra.org, on the Commission's Web site at http://
www.sec.gov, at the principal office of FINRA and at the Commission's
Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, FINRA included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. FINRA has prepared summaries, set forth in sections A,
B, and C below, of the most significant aspects of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The FINRA Trade Reporting Facilities (``TRFs'') are mechanisms for
reporting trades in NMS stocks effected otherwise than on an exchange.
Currently, there are two TRFs in operation: The FINRA/Nasdaq TRF and
the FINRA/NYSE TRF. At the time the TRFs were established, FINRA (then
NASD) entered into limited liability company agreements with the
respective Business Members, Nasdaq Stock Market (now known as Nasdaq
OMX Group) and New York Stock Exchange (the ``TRF LLC Agreements'').
    Following the establishment of the TRFs, FINRA was formed through
the consolidation of NASD and the member regulatory functions of NYSE
Regulation, effective July 30, 2007. FINRA and the TRF Business Members
subsequently executed amended and restated TRF LLC Agreements to
reflect the formation of FINRA and updated the schedules to reflect new
TRF officers and directors.
    FINRA is proposing to make technical changes to the TRF LLC
Agreements, as they appear in the FINRA Manual, to reflect the amended
and restated agreements and updated schedules. The terms and conditions
of the amended and restated TRF LLC Agreements are substantively
identical to those of the original TRF LLC Agreements. In this filing,
FINRA is not proposing to amend any FINRA rules.
    FINRA has filed the proposed rule change for immediate
effectiveness. The effective date and the implementation date will be
the date of filing.
2. Statutory Basis
    FINRA believes that the proposed rule change is consistent with the
provisions of Section 15A(b)(6) of the Act,\5\ which requires, among
other things, that FINRA rules must be designed to prevent fraudulent
and manipulative acts and practices, to promote just and equitable
principles of trade, and, in general, to protect investors and the
public interest. FINRA believes that the proposed rule change will
enhance the information available to members and the public regarding
FINRA's TRF LLC Agreements.
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    \5\ 15 U.S.C. 78o-3(b)(6).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    FINRA does not believe that the proposed rule change will result in
any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    Written comments were neither solicited nor received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    The proposed rule change has become effective upon filing pursuant
to Section 19(b)(3)(A) of the Act \6\ and paragraph (f)(3) of Rule 19b-
4 thereunder.\7\ At any time within 60 days of the filing of the
proposed rule change, the Commission may summarily abrogate such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.
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    \6\ 15 U.S.C. 78s(b)(3)(A).
    \7\ 17 CFR 240.19b-4(f)(3).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to<EMAIL_ADDRESS>Please include
File Number SR-FINRA-2010-020 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.

All submissions should refer to File Number SR-FINRA-2010-020. This
file number should be included on the subject line if e-mail is used.
To help the Commission process and review your comments more
efficiently, please use only one method. The Commission will post all
comments on the Commission's Internet Web site (http://www.sec.gov/
rules/sro.shtml). Copies of the submission, all subsequent amendments,
all written statements with respect to the proposed rule change that
are filed with the Commission, and all written communications relating
to the proposed rule change between the Commission and any person,
other than those that may be withheld from the public in accordance
with the provisions of 5 U.S.C. 552, will be available for Web site
viewing and printing in the Commission's Public Reference Room, 100 F
Street, NE., Washington, DC 20549, on official business days between
the hours of 10 a.m. and 3 p.m. Copies of such filing also will be
available for inspection and copying at the principal office of FINRA.
All comments received will be posted without change; the Commission
does not edit personal identifying information from submissions. You
should submit only information that you wish to make available
publicly. All submissions should refer to File Number SR-FINRA-2010-020
and should be submitted on or before June 7, 2010.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2010-11652 Filed 5-14-10; 8:45 am]
BILLING CODE 8010-01-P


[Federal Register Volume 77, Number 206 (Wednesday, October 24, 2012)]
[Proposed Rules]
[Pages 64935-64943]
[FR Doc No: 2012-26131]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 40

[Docket No. RM12-22-000]

Reliability Standards for Geomagnetic Disturbances

AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Notice of Proposed Rulemaking.

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SUMMARY: Under section 215 of the Federal Power Act, the Federal Energy

Regulatory Commission (Commission) proposes to direct the North
American Electric Reliability Corporation (NERC), the Commission-
certified Electric Reliability Organization, to submit for approval
Reliability Standards that address the impact of geomagnetic
disturbances (GMD) on the reliable operation of the Bulk-Power System.
The Commission proposes to do this in two stages. In the first stage,
the Commission proposes to direct NERC to file, within 90 days of the
effective date of a final rule in this proceeding, one or more
Reliability Standards that require owners and operators of the Bulk-
Power System to develop and implement operational procedures to
mitigate the effects of GMDs consistent with the reliable operation of
the Bulk-Power System. In the second stage, the Commission proposes to
direct NERC to file, within six months of the effective date of a final
rule in this proceeding, one or more Reliability Standards that require
owners and operators of the Bulk-Power System to conduct initial and
on-going assessments of the potential impact of GMDs on Bulk-Power
System equipment and the Bulk-Power System as a whole. Based on those
assessments, the Reliability Standards would require owners and
operators to develop and implement a plan so that instability,
uncontrolled separation, or cascading failures of the Bulk-Power
System, caused by damage to critical or vulnerable Bulk-Power System
equipment, or otherwise, will not occur as a result of a GMD. This plan
cannot be limited to operational procedures or enhanced training alone,
but should, subject to the needs indentified in the assessments,
contain strategies for protecting against the potential impact of GMDs
based on factors such as the age, condition, technical specifications,
or location of specific equipment. These strategies could include
automatically blocking geomagnetically induced currents from entering
the Bulk-Power System, instituting specification requirements for new
equipment, inventory management, and isolating certain equipment that
is not cost effective to retrofit. This second stage would be
implemented in phases, focusing first on the most critical Bulk-Power
System assets.

DATES: Comments are due December 24, 2012.

ADDRESSES: Comments, identified by docket number, may be filed in the
following ways:
     Electronic Filing through http://www.ferc.gov. Documents
created electronically using word processing software should be filed
in native applications or print-to-PDF format and not in a scanned
format.
     Mail/Hand Delivery: Those unable to file electronically
may mail or hand-deliver comments to: Federal Energy Regulatory
Commission, Secretary of the Commission, 888 First Street NE.,
Washington, DC 20426.
    Instructions: For detailed instructions on submitting comments and
additional information on the rulemaking process, see the Comment
Procedures Section of this document.

FOR FURTHER INFORMATION CONTACT:
    David Huff (Technical Information), Office of Electric Reliability,
Division of Security, Federal Energy Regulatory Commission, 888 First
Street NE., Washington, DC 20426,<PHONE_NUMBER><EMAIL_ADDRESS>    Matthew Vlissides (Legal Information), Office of the General
Counsel, Federal Energy Regulatory Commission, 888 First Street NE.,
Washington, DC 20426,<PHONE_NUMBER><EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Notice of Proposed Rulemaking

Issued October 18, 2012.

    1. Pursuant to section 215(d)(5) of the Federal Power Act (FPA),\1\
the Federal Energy Regulatory Commission (Commission) proposes to
direct the North American Electric Reliability Corporation (NERC), the
Commission-certified Electric Reliability Organization (ERO), to file
for approval with the Commission Reliability Standards (GMD Reliability
Standards) that address the risks posed by geomagnetic disturbances
(GMD) to the reliable operation of the Bulk-Power System.\2\ The
Commission proposes to direct NERC to develop the GMD Reliability
Standards in two stages. In the first stage, within 90 days of the
effective date of a final rule in this proceeding, NERC would file one
or more proposed Reliability Standards that require owners and
operators of the Bulk-Power System to develop and implement operational
procedures to mitigate the effects of GMDs consistent with the reliable
operation of the Bulk-Power System. In the second stage, within six
months of the effective date of a final rule in this proceeding, NERC
would file one or more proposed Reliability Standards that require
owners and operators of the Bulk-Power System to conduct initial and
on-going assessments of the potential impact of GMDs on Bulk-Power
System equipment and the Bulk-Power System as a whole. Based on those
assessments, the Reliability Standards would require owners and
operators to develop and implement a plan so that instability,
uncontrolled separation, or cascading failures of the Bulk-Power
System, caused by damage to critical or vulnerable Bulk-Power System
equipment, or otherwise, will not occur as a result of a GMD.\3\ This
plan cannot be limited to operational procedures or enhanced training
alone, but should, subject to the needs indentified in the assessments,
contain strategies for protecting against the potential impact of GMDs
based on factors such as the age, condition, technical specifications,
or location of specific equipment. These strategies could include
automatically blocking geomagnetically induced currents (GICs) from
entering the Bulk-Power System, instituting specification requirements
for new equipment, inventory management, and isolating certain
equipment that is not cost effective to retrofit.\4\ This second stage
would be implemented in phases, focusing first on the most critical
Bulk-Power System assets.
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    \1\ 16 U.S.C. 824o(d)(5) (2006).
    \2\ ``A geomagnetic disturbance occurs when the magnetic field
embedded in the solar wind is opposite that of the earth. This
disturbance, which results in distortions to the earth's magnetic
field, can be of varying intensity and has in the past impacted the
operation of pipelines, communications systems, and electric power
systems.'' Oak Ridge National Laboratory, Electric Utility Industry
Experience with Geomagnetic Disturbances at xiii (1991), available
at http://www.ornl.gov/~webworks/cpr/v823/rpt/51089.pdf.
    \3\ 16 U.S.C. 824o(a)(4) (2006).
    \4\ Some examples of automatic blocking include series line
capacitors, transformer neutral GIC blocking and/or reduction
devices, and selective tripping of vulnerable assets. Automatic
blocking measures can also include the use of relays that can be set
so that they are activated only when needed.
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    2. We take this action based on government-sponsored studies and
NERC studies that conclude that GMD events can have an adverse, wide-
area impact on the reliable operation of the Bulk-Power System.\5\ In a
2010 study prepared for the Commission, Department of Energy, and
Department of Homeland Security, the Oak Ridge National Laboratory
reported that GMD events can develop quickly over large

geographic footprints, having the capability to produce geographically-
large outages and significant damage to Bulk-Power System equipment.\6\
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    \5\ See, e.g., The Oak Ridge National Laboratory prepared a
study consisting of six technical reports (collectively, ``Oak Ridge
Study'') on the effects of electromagnetic pulses on the Bulk-Power
System. Available at http://www.ornl.gov/sci/ees/etsd/pes/ferc_emp_gic.shtml; North American Electric Reliability Corp., 2012
Special Reliability Assessment Interim Report: Effects of
Geomagnetic Disturbances on the Bulk Power System at 85 (February
2012) (NERC Interim GMD Report), available at http://www.nerc.com/files/2012GMD.pdf; North American Electric Reliability Corp., High-
Impact, Low-Frequency Event Risk to the North American Bulk Power
System at 68 (June 2010) (HILF Report), available at http://www.nerc.com/files/HILF.pdf.
    \6\ Oak Ridge National Laboratory, Electromagnetic Pulse:
Effects on the U.S. Power Grid: Meta-R-319 at pages 1-30, 1-31, 4-1
(January 2010) (Oak Ridge Study 319 Report), available at http://www.ornl.gov/sci/ees/etsd/pes/pubs/ferc_Meta-R-319.pdf.
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    3. The seriousness of the risk posed by GMDs to the reliable
operation of the Bulk-Power System was expressed at a Technical
Conference held on April 30, 2012.\7\ At the Technical Conference,
several panelists indicated that severe GMD events could potentially
compromise the reliable operation of the Bulk-Power System, with some
noting as an example the GMD-induced disruption of the Hydro-
Qu[eacute]bec grid in 1989.\8\ At the Technical Conference, panelists
stated that the current 11-year solar activity cycle is expected to hit
its maximum activity in 2013 and large solar events often occur within
four years of such a cycle maximum.\9\ While strong GMDs are infrequent
events, their potential impact on the reliable operation of the Bulk-
Power System (e.g., widespread blackouts) requires Commission action
under section 215(d)(5) of the FPA.\10\
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    \7\ Written statements presented at the Technical Conference,
post-Technical Conference comments, and Technical Conference
transcript are accessible through the Commission's eLibrary document
retrieval system in Docket No. AD12-13-000.
    \8\ See, e.g., Statement of Scott Pugh, U.S. Department of
Homeland Security at 2 (citing 1989 Hydro-Qu[eacute]bec blackout);
Statement of Frank Koza, PJM Interconnection, L.L.C. at 1 (``The
combination of half-cycle transformer saturation and increased
reactive power consumption can lead to voltage collapse and
blackouts if not properly managed.''); Statement of John Kappenman
at 8 (``The bulk power system is the nation's most important
critical infrastructure and unlike other threats, a severe
geomagnetic storms [sic] can impose a near simultaneous nationwide
crippling threat to this vital infrastructure.''); Statement of
Gerry Cauley, NERC at 1 (``Previous examples, such as the 1989 event
in Hydro Qu[eacute]bec demonstrate that severe solar storms
represent a serious risk that can challenge the reliability of the
bulk power system.'').
    \9\ April 30, 2012 Technical Conference Tr. 84:14-19 (Pugh);
106:9-15, 169:1-19 (Murtagh).
    \10\ 16 U.S.C. 824o(d)(5); see also Transmission Relay
Loadability Reliability Standard, 134 FERC ] 61,127, at P 25 (2011)
(explaining that under section 215(d)(5) ``the Commission, and not
just the ERO, has the responsibility and authority to identify
`specific matters' that it considers appropriate to carry out
section 215. Section 215 establishes a paradigm by which both the
Commission and the ERO are responsible for identifying reliability
gaps--the ERO through its Reliability Standards development process,
where it can independently identify areas of concern and develop
Standards to address them; and the Commission through its review of
proposed Reliability Standards and authority to direct modifications
or new Standards that address specific issues necessary to
effectuate the purposes of section 215.'').
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    4. Currently, GMD vulnerabilities are not adequately addressed in
the Reliability Standards.\11\ This constitutes a reliability gap
because, as discussed below, GMD events can cause the Bulk-Power System
to collapse suddenly and can potentially damage the Bulk-Power System.
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    \11\ NERC Reliability Standard IRO-005-3a (Reliability
Coordination--Current Day Operations), Requirement R3, is the only
existing requirement that discusses GMDs. Requirement R3 requires
reliability coordinators to make transmission operators and
balancing authorities aware of GMD forecast information and assist
as needed in the development of response plans, but it does not
require steps for mitigating the effects of GMD events.
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    5. GMD events affect the Bulk-Power System by introducing
geomagnetically-induced currents \12\ that can cause ``half-cycle
saturation'' of certain high-voltage Bulk-Power System
transformers.\13\ Half-cycle saturation of transformers can lead to
increased consumption of reactive power and creation of disruptive
harmonics that can cause the sudden collapse of the Bulk-Power
System.\14\ Further, half-cycle saturation from GICs can potentially
damage Bulk-Power System transformers because of overheating.\15\
Permanent damage to large transformers due to GICs can lead to
restoration delays for the power grid.\16\ For example, the Oak Ridge
Study assessed the effects of a ``1-in-100 year'' geomagnetic storm on
the modern Bulk-Power System.\17\ The Oak Ridge Study simulation
concluded that such an event could put a significant number of Bulk-
Power System transformers at risk for failure or permanent damage.\18\
The Oak Ridge Study simulation also found that the effects of a GMD
event may be substantially larger if it occurred at lower
latitudes.\19\ Estimates prepared by the National Research Council of
the National Academies concluded that these events have the potential
to cause widespread, long-term losses with economic costs to the United
States estimated at $1-2 trillion and a recovery time of four to ten
years.\20\ The NERC Interim GMD Report concluded, on the other hand,
that the worst-case scenario is ``voltage instability and subsequent
voltage collapse,'' and cites as an example the 1989 Hydro-
Qu[eacute]bec blackout.\21\ While the conclusions of these reports
differ significantly, our proposed action is warranted by even the
lesser consequence of a projected widespread blackout without long-
term, significant damage to the Bulk-Power System. Taking steps to
prevent such blackouts is consistent with maintaining the reliable
operation of the Bulk-Power System.\22\
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    \12\ GIC is an electrical current created by a solar event that
appears as direct current to the bulk electric system. North
American Electric Reliability Council, March 13, 1989 Geomagnetic
Disturbance at 36 (1989), available at http://www.nerc.com/files/1989-Quebec-Disturbance.pdf. Automatic blocking prevents or reduces
GICs flows into protected Bulk-Power System components without
operator intervention. NERC Interim GMD Report at 73.
    \13\ NERC Interim GMD Report at iii-iv. Half-cycle saturation is
an abnormal operating condition whereby a transformer operates
outside nominal voltage design values, saturating the transformer
core with magnetic flux and forcing magnetic flux into other parts
of the transformer. Id. at 25.
    \14\ Id. at 3 (``GMD can have * * * a wide range of impacts on
power apparatus and power system operations. The effects on
apparatus range from nuisance events, such as tripping of electrical
equipment, radio interference, and control malfunctions, to large-
scale events, such as voltage and reactive power fluctuations, local
disruption of service, limited equipment failure, and potential
voltage instability resulting in uncontrolled cascading of the bulk
power system.'').
    \15\ While disagreements exist as to the likely severity of
transformer damage from GMDs compared with the likelihood of voltage
collapse due to increased reactive power absorption arising from
GMDs, there appears to be a consensus that GMDs can cause at least
some damage to Bulk-Power System transformers. See, e.g., Comments
of the North American Electric Reliability Corporation, Docket No.
AD12-13-000, at 5 (filed May 21, 2012) (``Though the most likely
result is voltage collapse, the GMD Task Force members agreed that,
depending on the transformer health, design, geology and geomagnetic
latitude, geomagnetic induced current flows can result in
transformer loss-of-life, and may ultimately result in the failure
of some transformers.'').
    \16\ Oak Ridge Study 319 Report at pages 4-1, 4-3 (``The
recovery could plausibly extend into months in many parts of the
impacted regions * * * These multi-ton apparatus [transformers]
generally cannot be repaired in the field, and if damaged in this
manner, they need to be replaced with new units, which have
manufacture lead times of 12 months or more in the world market.'');
NERC Interim GMD Report at iv (``[R]estoration times for system
collapse due to voltage instability would be a matter of hours to
days, while replacing transformers requires long-lead times (a
number of months) to replace or move spares into place, unless they
are in a nearby location. Therefore, the failure of a large numbers
[sic] of transformers would have considerable impacts on portions of
the system.'').
    \17\ Oak Ridge Study 319 Report at page 3-22.
    \18\ Id. at page 1-14, Tables 4-1, 4-2, 4-3 (listing numbers of
at-risk transformers).
    \19\ Id. at pages 3-25, 3-26.
    \20\ National Research Council of the National Academies, Severe
Space Weather Events--Understanding Societal and Economic Impacts: A
Workshop Report at 4 (2008) (NAS Workshop Report), available at
http://www.nap.edu/catalog/12507.html.
    \21\ NERC Interim GMD Report at 69.
    \22\ 16 U.S.C. 824o(a)(4) (``The term `reliable operation' means
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.'').
---------------------------------------------------------------------------

    6. Given the potentially severe, wide-spread impact to the reliable
operation of the Bulk-Power System from GMD events and the absence of
existing Reliability Standards to address it, the Commission proposes
to direct the ERO to file with the Commission for approval Reliability
Standards that address this

reliability gap. In proposing to address the risks posed by GMDs in two
stages, the Commission finds that there are Reliability Standards that
the ERO can develop and file quickly (i.e., requiring GMD operational
procedures) to mitigate the effects of GMDs while it develops other
Reliability Standards that require owners and operators of the Bulk-
Power System to assess the potential impact of GMDs on Bulk-Power
System equipment and the Bulk-Power System as a whole. Based on those
assessments, the Reliability Standards would require owners and
operators to develop and implement a plan so that instability,
uncontrolled separation, or cascading failures of the Bulk-Power
System, caused by damage to critical or vulnerable Bulk-Power System
equipment, or otherwise, will not occur as a result of a GMD. This plan
cannot be limited to operational procedures or enhanced training alone,
but should, subject to the needs identified in the assessments, contain
strategies for protecting against the potential impact of GMDs based on
factors such as the age, condition, technical specifications, or
location of specific equipment. These strategies could include
automatically blocking geomagnetically induced currents from entering
the Bulk-Power System, instituting specification requirements for new
equipment, inventory management, and isolating certain equipment that
is not cost effective to retrofit.\23\
---------------------------------------------------------------------------

    \23\ See infra PP 34-36.
---------------------------------------------------------------------------

    7. We recognize that, depending on the results of the initial and
ongoing assessments that would be required under this proposed rule,
there could be substantial costs associated with some measures to
protect against damage to the Bulk-Power System from GMDs.\24\ In
determining that it is appropriate to issue this proposed rule,
however, we have compared such costs against the societal harms,
including the potential costs of equipment damage or prolonged
blackouts, that could result from taking no action.\25\
---------------------------------------------------------------------------

    \24\ For example, estimates for installing blocking devices on
transformers range from $100,000 to $500,000 for each affected
transformer. See Foundation for Resilient Societies, Comments on
Advance Notice of Proposed Rulemaking (ANPR) of the Nuclear
Regulatory Commission Relating to the Prevention and Mitigation of
Station Blackout, filed in Docket No. AD12-13-000, at 13 (May 4,
2012) (citing $500,000 installed costs per transformer); MITRE
Corp., Impacts of Severe Space Weather on the Electric Grid, at 66
(November 2011) (citing $100,000 cost for neutral-current-blocking-
capacitors per transformer), available at http://www.fas.org/irp/agency/dod/jason/spaceweather.pdf.
    \25\ For example the estimated total cost of the August 2003
four-day blackout in the United States is between $4 billion and $10
billion, with the Department of Energy calculating the total cost to
be $6 billion. Electricity Consumers Resource Council, The Economic
Impacts of the August 2003 Blackout, available at http://www.elcon.org/Documents/EconomicImpactsOfAugust2003Blackout.pdf. See
also supra P 5 (citing estimates by the National Research Council of
the National Academies of potentially $1-2 trillion in economic
costs from a severe GMD event).
---------------------------------------------------------------------------

I. Background

A. Section 215 and Mandatory Reliability Standards

    8. Section 215 of the FPA requires the Commission to certify an ERO
to develop mandatory and enforceable Reliability Standards, subject to
Commission review and approval.\26\ Once approved, the Reliability
Standards may be enforced in the United States by the ERO, subject to
Commission oversight, or by the Commission independently.
---------------------------------------------------------------------------

    \26\ 16 U.S.C. 824o (2006).
---------------------------------------------------------------------------

    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.\27\
---------------------------------------------------------------------------

    \27\ 16 U.S.C. 824o(d)(5); 18 CFR 39.6(f) (2012).
---------------------------------------------------------------------------

B. Studies of GMD Events on the Bulk-Power System

    10. The impact of GMDs on the Bulk-Power System has been evaluated
in several government-sponsored studies and NERC reports. The EMP
Commission issued reports assessing the threat to the United States
from Electromagnetic Pulse (EMP) attack in 2004 and 2008, which also
addressed the effects of geomagnetic storms on the electric power
infrastructure.\28\ The NAS Workshop Report addressing the impact of
severe space weather events was released in 2008. The Oak Ridge
National Laboratory issued the Oak Ridge Study on the effects of
electromagnetic pulses on the Bulk-Power System in January 2010. The
NERC HILF Report on high-impact, low-frequency risks to the Bulk-Power
System was issued in June 2010.\29\ In February 2012, NERC issued the
NERC Interim GMD Report evaluating the effects of GMDs on the Bulk-
Power System.
---------------------------------------------------------------------------

    \28\ These reports are accessible at the Commission to Assess
the Threat to the United States from Electromagnetic Pulse (EMP)
Attack Web site at http://www.empcommission.org/.
    \29\ The HILF Report was prepared by NERC, Department of Energy,
and a steering committee comprised of industry and risk experts and
was approved by the NERC Board of Trustees on May 17, 2010. HILF
Report at 2.
---------------------------------------------------------------------------

    11. The Commission conducted a staff-led Technical Conference on
April 30, 2012 to discuss the effects of GMDs on the reliable operation
of the Bulk-Power System. NERC, government agencies, industry
stakeholders, and other interested entities attended the Technical
Conference and submitted post-Technical Conference comments.

C. Effects of GMD Events on the Bulk-Power System

    12. The interaction of the Earth's magnetic field and solar events
can cause low frequency GICs to flow along the surface of the Earth and
in the oceans. Reliability issues arise when GICs enter the Bulk-Power
System from the Earth. Since many Bulk-Power System transformers are
grounded, the GIC appears as electrical current to the Bulk-Power
System and flows through the ground connection and conductors, such as
transformers and transmission lines.\30\
---------------------------------------------------------------------------

    \30\ Oak Ridge National Laboratory, Electromagnetic Pulse:
Effects on the U.S. Power Grid (Meta-R-322) at page 1-1 (January
2010) (Oak Ridge Study 322 Report), available at http://www.ornl.gov/sci/ees/etsd/pes/pubs/ferc_Meta-R-322.pdf.
---------------------------------------------------------------------------

    13. GICs can cause transformer cores to become ``saturated,''
resulting in loss of reactive power (VARs), the introduction of
harmonic distortions, and possible physical damage to the
transformer.\31\ GICs enter the Bulk-Power System through the grounded
neutrals of transformers and are responsible for forcing their metal
cores into saturation.\32\ A primary effect of saturation is the
potential for transformer damage through the overheating of internal
components.\33\

Saturation is also responsible for secondary effects, such as the
production of harmonics that are not present during normal Bulk-Power
System operation and for substantially increasing the transformer's
absorption of reactive power from the system, thus requiring
significant amounts of additional voltage support to compensate for
reactive power absorption. Harmonic production and reactive power
absorption may interfere with normal system operations creating
secondary effects on other Bulk-Power System facilities. These primary
and secondary effects can occur almost simultaneously over a large
geographic area, resulting in a multiple contingency outage that has
the potential to cascade across the Bulk-Power System.\34\
---------------------------------------------------------------------------

    \31\ HILF Report 70-71. Harmonics are currents or voltages with
frequencies that are integer multiples of the fundamental power
frequency (i.e., 60 Hz in the United States). See Northeast Power
Coordinating Council, Inc. Glossary of Terms, available at https://www.npcc.org/Standards/Directories/Glossary%20of%20Terms.pdf. They
can cause overcurrent relays to automatically trip components (e.g.,
capacitor banks and static VAR compensators) from service. HILF
Report at 71. Automatic removal of such components can further
exacerbate system voltages already reduced by the GIC-related
absorption of reactive power.
    \32\ Oak Ridge Study 322 Report at pages 1-1, 7-11.
    \33\ HILF Report at 70 (``Transformers experience excessive
levels of internal heating brought on by stray flux when GICs cause
the transformer's magnetic core to saturate and spill flux outside
the normal core steel magnetic circuit. Previous well-documented
cases have noted heating failures that caused melting and burn-
through of large-amperage copper windings and leads in these
transformers (Figure 9).''); Oak Ridge Study 319 Report at page 2-29
(``Also of note from this particular [March 1989] storm is strong
evidence that GIC-induced half-cycle saturation of transformers can
indeed produce enough heat to severely damage or even destroy
exposed large power transformers.'').
    \34\ HILF Report at 71-72.
---------------------------------------------------------------------------

    14. The Oak Ridge Study identified factors that determine the
severity of GMD events, including: (1) Location and strength of the
underlying solar event; (2) ground conductivity in the affected
locations (i.e., the geology of the location); (3) orientation of the
transmission lines; (4) length of transmission lines; and (5) grid
construction.\35\ A solar disturbance can cause near-simultaneous,
multi-point failures that can trigger collapse of the Bulk-Power
System.\36\
---------------------------------------------------------------------------

    \35\ Oak Ridge Study 319 Report at page 2-5.
    \36\ Id. at pages 4-1, 4-2. One example cited in the Oak Ridge
Study is the March 13, 1989 solar disturbance that triggered the
collapse of the Hydro-Qu[eacute]bec power grid, which went from
normal to a situation where it sustained seven contingencies in an
elapsed time of 57 seconds. Id.
---------------------------------------------------------------------------

II. Discussion

    15. As discussed below, the Commission finds that there is a gap in
the Reliability Standards regarding GMDs. Therefore, in order to carry
out section 215 of the FPA, the Commission proposes to direct the ERO
to develop and file for approval Reliability Standards that address the
potentially severe, wide-spread impact of GMD events on the reliable
operation of the Bulk-Power System.
    16. We propose that the ERO develop and file the GMD Reliability
Standards in two stages. In the first stage, within 90 days of the
effective date of a final rule in this proceeding, the Commission
proposes to direct NERC to file one or more Reliability Standards that
require owners and operators of the Bulk-Power System to develop and
implement operational procedures to mitigate the effects of GMDs
consistent with the reliable operation of the Bulk-Power System. In the
second stage, the Commission proposes to direct NERC to file one or
more Reliability Standards, within six months of the effective date of
a final rule in this proceeding, that require owners and operators of
the Bulk-Power System to assess the impact of GMDs on Bulk-Power System
equipment and the Bulk-Power System as a whole. Based on those
assessments, the Reliability Standards would require owners and
operators to develop and implement a plan so that instability,
uncontrolled separation, or cascading failures of the Bulk-Power
System, caused by damage to critical or vulnerable Bulk-Power System
equipment, or otherwise, will not occur as a result of a GMD. This plan
cannot be limited to operational procedures or enhanced training alone,
but should, subject to the needs indentified in the assessments,
contain strategies for protecting against the potential impact of GMDs
based on factors such as the age, condition, technical specifications,
or location of specific equipment. These strategies could include
automatically blocking geomagnetically induced currents from entering
the Bulk-Power System, instituting specification requirements for new
equipment, inventory management, and isolating certain equipment that
is not cost effective to retrofit.\37\
---------------------------------------------------------------------------

    \37\ The second stage Reliability Standards would not require
owners and operators of the Bulk-Power System to protect the Bulk-
Power System beyond what is found to be required based on the
initial and ongoing assessments.
---------------------------------------------------------------------------

    17. In proposing to direct the ERO to submit Reliability Standards
that address the impact of GMD events on the reliable operation of the
Bulk-Power System, we are not proposing specific requirements or
otherwise pre-judging what the ERO may eventually submit. Instead, we
identify concerns that we believe should be addressed in any GMD
Reliability Standards. We expect the ERO to support its proposed
Reliability Standards and explain how they address the Commission's
concerns.

A. Reliability Standards Requiring Operational Procedures

    18. Requiring operational procedures, while not a complete
solution, constitutes a first step to addressing the GMD reliability
gap because they can be implemented relatively quickly.\38\ The
Commission does not propose to require the ERO or owners and operators
of the Bulk-Power System to adopt any particular operational
procedures. Owners and operators of the Bulk-Power System are the most
familiar with the equipment and system configurations. Accordingly, we
propose that the ERO file one or more Reliability Standards requiring
owners and operators of the Bulk-Power System to develop and implement
operational procedures to mitigate the effects of GMDs consistent with
the reliable operation of the Bulk-Power System based on the following
guidance.
---------------------------------------------------------------------------

    \38\ NERC Interim GMD Report at 79 (``Operating procedures are
the quickest way to put in place actions that can mitigate the
adverse effects of GIC on system reliability * * * Both system
operating and transmission owner organizations need to have
appropriate procedures and training in place.'').
---------------------------------------------------------------------------

    19. Operational procedures may help alleviate abnormal system
conditions due to transformer absorption of reactive power during GMD
events, helping to stabilize system voltage swings, and may potentially
isolate some equipment from being damaged or misoperated. The NERC
Interim GMD Report identifies examples of operational procedures to
mitigate GMD events (i.e., the effects of GICs), including: reduction
of equipment loading (e.g., by starting off-line generation), unloading
the reactive load of operating generation, reductions of system
voltage, and system and/or equipment isolation through reconfiguration
of the transmission system.\39\ Some entities already have operational
procedures to mitigate the effect of GICs on the Bulk-Power System
utilizing system resources.\40\ The Commission expects that the ERO and
owners and operators of the Bulk-Power System will draw on industry's
experience in developing and implementing existing operational
procedures. Given that experience, we propose to direct NERC to file,
within 90 days of the effective date of a final rule in this
proceeding, proposed Reliability Standards that require the development
and implementation of operational procedures. While this deadline is
aggressive, mandatory and enforceable Reliability Standards requiring
owners and operators to implement operational procedures should be
established quickly to afford some level of uniform protection to the
Bulk-Power System against GMD events. As discussed above, the impact of
GMDs on the Bulk-Power System has been studied extensively for many
years, laying the foundation for the prompt development of these first
stage Reliability Standards. Moreover, the fact that operational
procedures are already in place in some areas should allow for

faster development and implementation of these Reliability Standards.
---------------------------------------------------------------------------

    \39\ NERC Interim GMD Report at 80-81.
    \40\ See, e.g., PJM Interconnection, L.L.C., Manual 13:
Emergency Operations at 47, available at http://www.pjm.com/~/media/
documents/manuals/m13.ashx; Northeast Power Coordinating Council,
Inc., Procedures for Solar Magnetic Disturbances Which Affect
Electric Power Systems, available at https://www.npcc.org/Standards/Procedures/c-15.pdf.
---------------------------------------------------------------------------

    20. While the proposed Reliability Standards should not necessarily
specify what operational procedures must be adopted, the ERO should
give owners and operators of the Bulk-Power System guidance as to what
procedures have been or are expected to be effective in mitigating the
effects of GMDs consistent with the reliable operation of the Bulk-
Power System. Moreover, the proposed Reliability Standards should
address the coordination of operational procedures among responsible
entities across regions.\41\ Since there could be potential equipment
damage resulting from a GMD event, the proposed Reliability Standards
should also address operational procedures for restoring GMD-impacted
portions of the Bulk-Power System that take into account the potential
for equipment that is damaged or out-of-service for an extended period
of time.
---------------------------------------------------------------------------

    \41\ NERC Interim GMD Report at 79 (``The [operating] procedures
of these organizations need to be coordinated with each other and
with their neighboring organizations.'').
---------------------------------------------------------------------------

    21. We do not propose to direct a specific implementation schedule
for the proposed Reliability Standards, but the Commission encourages
the ERO to require owners and operators of the Bulk-Power System to
implement the required operational procedures 90 days after Commission
approval of the Reliability Standards. Following implementation, the
Commission proposes to require NERC to provide periodic reports
assessing the effectiveness of the operational procedures in mitigating
the effects of GMD events. In addition, NERC should periodically review
the required operational procedures and recommend to owners and
operators that they incorporate lessons-learned and new research
findings.
    22. In addition to developing Reliability Standards that require
operational procedures during the first stage, the Commission also
proposes to accept aspects of the ``Initial Actions'' proposal set
forth in NERC's May 21, 2012 post-Technical Conference comments.
Specifically, NERC proposed to ``identify facilities most at-risk from
severe geomagnetic disturbance'' and to ``conduct wide-area geomagnetic
disturbance vulnerability assessment.'' \42\ As noted in NERC's
comments regarding the vulnerability assessments, special attention
would be given to evaluating critical transformers (e.g., step-up
transformers at large generating facilities). We agree with NERC that
critical Bulk-Power System facilities should be evaluated for GMD
vulnerability as an initial action. In addition, as part of the initial
action, special attention should be given to those Bulk-Power System
facilities that provide service to critical and priority loads.\43\ The
Commission, therefore, proposes to direct NERC to conduct this
``initial action'' simultaneously with the development and
implementation of the first stage GMD Reliability Standards. The
Commission seeks comment from NERC and other interested entities on all
aspects of this proposal.
---------------------------------------------------------------------------

    \42\ NERC Comments at 8-9 (``As the first step in identifying
the risk of geomagnetic disturbance to the bulk power system, NERC
intends to complete a system-wide vulnerability assessment * * *
special attention will be given to the evaluation of critical
transformers, such as generator step-up units at large generating
facilities * * * a high level review will be conducted to identify
and classify the at-risk population based on existing peer-reviewed
research. This assessment will be based on a high level screening
approach that will include transformer design, condition, geology
and geomagnetic location.'').
    \43\ The NERC Severe Impact Resilience Task Force identified
critical and priority loads in a report. See Severe Impact
Resilience: Considerations and Recommendations at 26 (Accepted by
NERC Board of Trustees on May 9, 2012), available at http://www.nerc.com/docs/oc/sirtf/SIRTF_Final_May_9_2012-Board_Accepted.pdf.
---------------------------------------------------------------------------

B. Second Stage Reliability Standards

    23. To address GMDs comprehensively, the Commission proposes to
direct NERC to develop, in a second stage, Reliability Standards that
require owners and operators of the Bulk-Power System to conduct
initial and on-going assessments of the potential impact of GMDs on
Bulk-Power System equipment and on the Bulk-Power System as a whole.
Based on those assessments, the Reliability Standards would require
owners and operators to develop and implement a plan so that
instability, uncontrolled separation, or cascading failures of the
Bulk-Power System, caused by damage to critical or vulnerable Bulk-
Power System equipment, or otherwise, will not occur as a result of a
GMD. This plan cannot be limited to operational procedures or enhanced
training alone, but should, subject to the needs identified in the
assessments, contain strategies for protecting against the potential
impact of GMDs based on factors such as the age, condition, technical
specifications, or location of specific equipment. These strategies
could include automatically blocking geomagnetically induced currents
from entering the Bulk-Power System, instituting specification
requirements for new equipment, inventory management, and isolating
certain equipment that is not cost effective to retrofit. While the
Commission proposes to direct the ERO to submit the proposed second
stage Reliability Standards within six months of the effective date of
a final rule in this proceeding, the Commission seeks comment on the
feasibility of a six-month deadline.
    24. We propose to direct the filing of these second stage GMD
Reliability Standards because of two concerns with relying on
operational procedures alone: (1) Owners and operators of the Bulk-
Power System may not have enough time to initiate effective operating
procedures after being warned of a GMD event; and (2) operational
procedures may not prevent permanent damage to Bulk-Power System
equipment.\44\ Current GMD forecasting methods provide limited time for
operators to react once a GMD warning is issued.\45\ Even with enough
time to react, the Oak Ridge Study found that, given a large enough GMD
event, operational procedures are unlikely to provide the substantial
levels of GIC reduction needed to limit the potential for permanent
damage to transformers.\46\ The Oak Ridge Study and the HILF Report
also found that widespread damage to Bulk-Power System transformers
could result in prolonged outages.\47\
---------------------------------------------------------------------------

    \44\ NERC Interim GMD Report at 10 (``These warning can be
received as short as 30 minutes before the onset of an impending
geomagnetic storm.''). At the April 30, 2012 Technical Conference,
Mr. Murtagh, Program Coordinator at the National Oceanic and
Atmospheric Administration's Space Weather Prediction Center, stated
that a warning is issued when a GMD event reaches the NASA Advanced
Composition Explorer (ACE) satellite and at that point, in some
cases, it could be 20 or 30 minutes before the event reaches the
Earth's magnetic field. April 30, 2012 Technical Conference Tr.
170:5-22 (Murtagh).
    \45\ Mr. Pugh, from the U.S. Department of Homeland Security's
Interagency Programs Office Science & Technology Directorate, stated
that the operators in the 1989 Hydro-Qu[eacute]bec blackout only had
90 seconds to react, which was insufficient to ``prevent a massive
blackout and significant equipment damage.'' April 30, 2012
Technical Conference Tr. 12:4-7 (Pugh).
    \46\ Oak Ridge Study 322 Report at pages ix and 1-1.
    \47\ HILF Report at 12 (``The physical damage of certain system
components (e.g. extra-high-voltage transformers) on a large scale,
as could be effected by any of these threats, could result in
prolonged outages as procurement cycles for these components range
from months to years.''); Oak Ridge Study 319 Report at pages 2-33,
2-34 (``An especially large storm or GIC event could plausibly
create the potential for widespread failure of many exposed
transformers and hamper rapid restoration capabilities. In extreme
cases, where replacements may take months, a situation may exist
where the demand for electric service can only be partially
supplied, raising the prospect of rationing and rotating blackouts
to regions that are unable to be fully served.'').
---------------------------------------------------------------------------

    25. We recognize that the NERC Interim GMD Report concludes that a
prolonged blackout due to extensive

damage to Bulk-Power System transformers is less likely than voltage
instability due to increased reactive power consumption and loss of
reactive power support, which can lead to blackouts like the 1989
Hydro-Qu[eacute]bec event.\48\ The Commission's proposed two-stage
approach recognizes this difference by focusing first on the
development of Reliability Standards requiring operational procedures
in a relatively short time frame. The Commission proposes to give NERC
and owners and operators of the Bulk-Power System more time to perform,
in the second stage, initial and on-going assessments. Based on those
assessments, the Reliability Standards would require owners and
operators to develop and implement a plan so that instability,
uncontrolled separation, or cascading failures of the Bulk-Power
System, caused by damage to critical or vulnerable Bulk-Power System
equipment, or otherwise, will not occur as a result of a GMD. This plan
cannot be limited to operational procedures or enhanced training alone,
but should, subject to the needs identified in the assessments, contain
strategies for protecting against the potential impact of GMDs based on
factors such as the age, condition, technical specifications, or
location of specific equipment. These strategies could include
automatically blocking geomagnetically induced currents from entering
the Bulk-Power System, instituting specification requirements for new
equipment, inventory management, and isolating certain equipment that
is not cost effective to retrofit. Moreover, although the NOPR proposes
that the second stage Reliability Standards be filed within six months
of the effective date of the final rule, we seek comment on the
feasibility of that deadline.
---------------------------------------------------------------------------

    \48\ NERC Interim GMD Report at vi.
---------------------------------------------------------------------------

    26. Below, we offer guidance on the assessments of Bulk-Power
System vulnerability to GMDs and potential measures for automatically
protecting critical or vulnerable components. In addition, recognizing
the potential for substantial investments of time and resources to
implement these Reliability Standards, we offer guidance on an
implementation schedule, which will likely consist of an extended,
multi-phase process. The Commission seeks comment from NERC and other
interested entities on all aspects of this proposal.
1. GMD Vulnerability Assessments of the Bulk-Power System
    27. The Commission proposes to direct the ERO to develop
Reliability Standards that require owners and operators of the Bulk-
Power System to conduct vulnerability assessments to determine how
critical or vulnerable Bulk-Power System components react to simulated
GICs of varying intensities.\49\ The Commission proposes to direct the
ERO to consider the following parameters as it develops the Reliability
Standards.\50\
---------------------------------------------------------------------------

    \49\ To accurately simulate the impact of GMDs on the Bulk-Power
System, the assessments should consider the impact of GICs that may
enter the system through transformers that are not treated as part
of the bulk electric system and any impact that the non-bulk
electric system transformers may have on the reliability of the
Bulk-Power System. We do not propose, however, that equipment
falling outside of our jurisdiction would be required to be
protected under the proposed Reliability Standard.
    \50\ The vulnerability assessments in the second phase
Reliability Standards are distinct from the ``initial action''
evaluations, discussed above, which NERC proposed to do and we
propose to have NERC conduct simultaneous with the development and
implementation of the first phase Reliability Standards. We expect,
however, that the analyses performed in the ``initial action''
evaluations will be used to quickly identify and protect the most
critical and vulnerable Bulk-Power System components once the second
stage Reliability Standards become effective.
---------------------------------------------------------------------------

    28. First, the Reliability Standards should contain uniform
evaluation criteria for owners and operators to follow when conducting
their assessments. As the Commission noted with respect to other
reliability assessments, uniformity increases the accuracy of
transmission system reliability assessments and consequently enhances
overall reliability.\51\
---------------------------------------------------------------------------

    \51\ Mandatory Reliability Standards for the Bulk-Power System,
Order No. 693, FERC Stats. & Regs. ] 31,242, at P 1298, order on
reh'g, Order No. 693-A, 120 FERC ] 61,053 (2007).
---------------------------------------------------------------------------

    29. Second, the assessments should, through studies and
simulations, evaluate the primary and secondary effects of GICs on
Bulk-Power System transformers, including the effects of GICs
originating from and passing to other regions.
    30. Third, the assessments should evaluate the effects of GICs on
other Bulk-Power System equipment, system operations, and system
stability, including the anticipated loss of critical or vulnerable
devices or elements resulting from GIC-related issues.\52\
---------------------------------------------------------------------------

    \52\ The Oak Ridge Study assessment included GMD modeling,
simulation and review of storm impacts, power grid GIC flows and
reactive power demands, transformer heating and risk of potential
damage to transformers. See generally Oak Ridge Study 319 Report.
---------------------------------------------------------------------------

    31. Fourth, in conjunction with assessments by owners and operators
of their own Bulk-Power System components, wide-area or Regional
assessments of GIC impacts should be performed. A severe GMD event can
cause simultaneous stresses at multiple locations on the Bulk-Power
System, potentially resulting in a multiple-outage event.\53\ In
predicting GIC flows, it is necessary to take into consideration the
network topology as an integrated whole (i.e., on a wide-area
basis).\54\
---------------------------------------------------------------------------

    \53\ Oak Ridge Study 319 Report at pages A1-1, A1-2.
    \54\ Id. at page 1-17.
---------------------------------------------------------------------------

    32. Fifth, the assessments should be periodically updated, taking
into account new facilities, modifications to existing facilities, and
new information, including new research on GMDs, to determine whether
there are resulting changes in GMD impacts that require modifications
to Bulk-Power System mitigation schemes.
    33. The Commission seeks comments from NERC and other interested
entities on all aspects of this proposal.
2. Automatic GIC Blocking for Critical or Vulnerable Bulk-Power System
Components
    34. While we do not propose to require a particular solution in the
second stage Reliability Standards to address GMDs, we expect that some
assessments will demonstrate that automatic blocking is necessary in
some instances. The Commission, above, proposes to direct the ERO to
develop Reliability Standards that require owners and operators of the
Bulk-Power System to develop and implement a plan so that instability,
uncontrolled separation, or cascading failures of the Bulk-Power
System, caused by damage to critical or vulnerable Bulk-Power System
equipment, or otherwise, will not occur as a result of a GMD. Automatic
blocking measures address the major concerns with relying exclusively
on operational procedures to mitigate GMDs (i.e., the short period of
time to react to a GMD event and the potential consequences of not
reacting fast enough). Blocking can prevent the flow of GICs through
power transformers and the Bulk-Power System.\55\ Eliminating GICs in
transformers prevents transformer core saturation and, thus, mitigates
or prevents the effects of GMDs on the Bulk-Power System (i.e.,
transformer overheating, reactive power absorption, and harmonic
generation).
---------------------------------------------------------------------------

    \55\ NERC Interim GMD Report at 73.
---------------------------------------------------------------------------

    35. The Commission does not propose to direct the ERO to require a
particular automatic blocking technology, where blocking is necessary.
Instead, the Commission proposes to direct the ERO to identify in the
proposed Reliability Standards what would constitute appropriate
automatic blocking measures. In defining what is an

appropriate blocking measure, the ERO should address: (1) Its
feasibility and effectiveness; and (2) its ability to operate without
adversely impacting the reliable operation of the Bulk-Power System.
The Commission proposes that the Reliability Standards should include a
means by which the ERO can verify that selected blocking measures are
appropriate.
    36. The use of automatic blocking devices, such as transmission
line series capacitors and transformer neutral blocking, are possible
measures.\56\ These devices block or reduce the flow of GIC in a power
grid.\57\ Although not a means for blocking GICs, another possible
option is to improve the ``withstand'' capability of Bulk-Power System
components. The ``withstand'' capability, in this context, refers to a
component's ability to withstand stresses imposed by GICs before
suffering damage, but it does not prevent GICs from affecting the rest
of the Bulk-Power System (e.g., it does not prevent the secondary
effects of harmonics or increased reactive power consumption).\58\ The
ERO should consider whether the reliability goals of the proposed
Reliability Standards can be achieved by a combination of automatic
protection measures, including, for example, some combination of
automatic blocking and improved ``withstand'' capability. In any event,
the measures must be adequate to protect the reliability of the Bulk-
Power System against the risks identified in the assessments.
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    \56\ Oak Ridge Study 322 Report at ix-x.
    \57\ Id.
    \58\ NERC Interim GMD Report at 67.
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    37. The Commission seeks comments from NERC and other interested
entities on all aspects of this proposal.
3. Implementation Schedule
    38. The second stage Reliability Standards will likely require an
extended, multi-phase implementation period given the time needed to
conduct the required assessments and the time and cost of installing
any required automatic protection measures. Although the Commission
does not propose to direct the ERO to develop a specific implementation
plan, we believe it would be appropriate for the proposed Reliability
Standard to include an implementation schedule that requires owners and
operators of the Bulk-Power System to prioritize implementation so that
components considered vital to the reliable operation of the Bulk-Power
System are provided with any necessary automatic protection measures in
the earliest phase of the plan.\59\
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    \59\ For example, critical Bulk-Power System equipment
identified by NERC in the first stage ``initial actions''
assessments, discussed previously, should be protected in the
earliest phase of the implementation plan.
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    39. The Commission seeks comments from NERC and other interested
entities on an implementation plan.

III. Information Collection Statement

    40. The Office of Management and Budget (OMB) regulations require
approval of certain information collection requirements imposed by
agency rules. 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 an agency 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) requires each federal agency
to seek and obtain OMB approval before undertaking a collection of
information directed to ten or more persons, or contained in a rule of
general applicability.
    41. The Commission is submitting these reporting 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, 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.
    42. The Public Reporting Burden and cost related to the proposed
rule in Docket No. RM12-22-000 are covered by, and already included in,
the existing FERC-725, Certification of Electric Reliability
Organization; Procedures for Electric Reliability (OMB Control No.
1902-0225). FERC-725 includes the ERO's overall responsibility for
developing Reliability Standards, such as the Reliability Standards for
Geomagnetic Disturbances.
    43. Internal review: The Commission has reviewed the proposed
changes and has determined that the changes are necessary to ensure the
reliability and integrity of the Nation's Bulk-Power System.
    44. 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, email<EMAIL_ADDRESS>Phone: (202)
502-8663, fax:<PHONE_NUMBER>]. Comments on the requirements of this
rule 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 email to OMB at<EMAIL_ADDRESS>Please reference OMB Control No. 1902-0225,
FERC-725 and the docket number of this proposed rulemaking in your
submission.

IV. Environmental Analysis

    45. 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.\60\ The
Commission has categorically excluded certain actions from this
requirement as not having a significant effect on the human
environment. Included in the exclusion are rules that are clarifying,
corrective, or procedural or that do not substantially change the
effect of the regulations being amended.\61\ The actions proposed here
fall within this categorical exclusion in the Commission's regulations.
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    \60\ Regulations Implementing the National Environmental Policy
Act of 1969, Order No. 486, 52 FR 47897 (Dec. 17, 1987), FERC Stats.
& Regs., Regulations Preambles 1986-1990 ] 30,783 (1987).
    \61\ 18 CFR 380.4(a)(2)(ii).
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V. Regulatory Flexibility Act

    46. The Regulatory Flexibility Act of 1980 (RFA) \62\ generally
requires a description and analysis of proposed rules that will have
significant economic impact on a substantial number of small entities.
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    \62\ 5 U.S.C. 601-612.
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    47. By only proposing to direct NERC, the Commission-certified ERO,
to develop GMD Reliability Standards, this Notice of Proposed
Rulemaking will not have a significant or substantial impact on
entities other than NERC. The ERO develops and files with the
Commission for approval Reliability Standards affecting the Bulk-Power
System, which represents: (a) A total electricity demand of 830
gigawatts (830,000 megawatts) and (b) more than $1 trillion worth of
assets. Therefore, the Commission certifies that this Notice of
Proposed Rulemaking will not have a significant economic impact on a
substantial number of small entities.
    48. Any Reliability Standards proposed by NERC in compliance with

this rulemaking will be considered by the Commission in future
proceedings. As part of any future proceedings, the Commission will
make determinations pertaining to the Regulatory Flexibility Act based
on the content of the Reliability Standards proposed by NERC.

VI. Comment Procedures

    49. 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 December 24, 2012. Comments must refer to
Docket No. RM12-22-000, and must include the commenter's name, the
organization they represent, if applicable, and their address in their
comments.
    50. 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.
    51. Commenters that are not able to file comments electronically
must send an original of their comments to: Federal Energy Regulatory
Commission, Secretary of the Commission, 888 First Street NE.,
Washington, DC 20426.
    52. 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

    53. 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 the Commission's Home Page (http://www.ferc.gov) and
in the Commission's Public Reference Room during normal business hours
(8:30 a.m. to 5:00 p.m. Eastern time) at 888 First Street NE., Room 2A,
Washington, DC 20426.
    54. From the Commission'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.
    55. User assistance is available for eLibrary and the Commission's
Web site during normal business hours from the Commission's Online
Support at<PHONE_NUMBER> (toll free at 1-866-208-3676) or email at
<EMAIL_ADDRESS>or the Public Reference Room at (202) 502-
8371, TTY<PHONE_NUMBER>. Email the Public Reference Room at
<EMAIL_ADDRESS>
    By direction of the Commission.
Kimberly D. Bose,
Secretary.
[FR Doc. 2012-26131 Filed 10-23-12; 8:45 am]
BILLING CODE 6717-01-P