North American Electric Reliability Corporation; Order Approving Extreme Cold Weather Reliability Standards EOP-011-3 and EOP-012-1 and Directing Modification of Reliability Standard EOP-012-1, 14994-15011 [2023-04875]
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BILLING CODE 6450–01–P
DEPARTMENT OF ENERGY
Federal Energy Regulatory
Commission
[Docket No. RD23–1–000]
North American Electric Reliability
Corporation; Order Approving Extreme
Cold Weather Reliability Standards
EOP–011–3 and EOP–012–1 and
Directing Modification of Reliability
Standard EOP–012–1
BILLING CODE 4000–01–P
DEPARTMENT OF ENERGY
Request for Information—Foundation
for Energy Security and Innovation
(FESI); Correction
Office of Technology
Transitions, Department of Energy.
ACTION: Request for information (RFI);
correction.
AGENCY:
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Before Commissioners: Willie L.
Phillips, Acting Chairman; James P.
Danly, Allison Clements, and Mark C.
Christie.
1. On October 28, 2022, the North
American Electric Reliability
Corporation (NERC), the Commissioncertified Electric Reliability
Organization (ERO), submitted a
petition seeking approval of proposed
Reliability Standards EOP–011–3
(Emergency Operations) and EOP–012–
1 (Extreme Cold Weather Preparedness
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and Operations).1 As discussed in this
order, we approve proposed Reliability
Standards EOP–011–3 and EOP–012–1,
their associated violation risk factors
and violation severity levels, and the
newly defined terms Generator Cold
Weather Critical Component, Extreme
Cold Weather Temperature, and
Generator Cold Weather Reliability
Event.
2. It is essential to the reliable
operation of the Bulk-Power System to
‘‘ensure enough generating units will be
available during the next cold weather
event.’’ 2 As the November 2021 Report
found, the Bulk-Power System ‘‘cannot
operate reliably without adequate
generation.’’ When cold weather events
such as Winter Storm Uri occur, with
‘‘massive numbers of generating units’’
failing, grid operators could have no
other option than to shed firm customer
load to prevent uncontrolled load
shedding and cascading outages. And as
unfortunately illustrated by Winter
Storm Uri, ‘‘[t]hese firm load shedding
events . . . have very real human
consequences. Millions went without
heat . . . Hundreds died from
hypothermia.’’ 3 Accordingly, we
approve proposed Reliability Standards
EOP–011–3 and EOP–012–1 as just,
reasonable, not unduly discriminatory
or preferential, and in the public
interest.
3. While NERC’s proposed Reliability
Standards may ‘‘provide new
protections not currently found in any
Reliability Standard,’’ 4 EOP–012–1, in
its current form, includes undefined
terms, broad limitations, exceptions and
exemptions, and prolonged compliance
periods. Thus, we find that Reliability
Standard EOP–012–1 requires
improvement to address concerns, as
discussed further below. Therefore,
pursuant to section 215(d)(5) of the
Federal Power Act (FPA),5 we direct
NERC to develop and submit
modifications to Reliability Standard
EOP–012–1 as discussed herein.
4. As an initial matter, we are
concerned that use of the terms
‘‘continuous run,’’ ‘‘commits or is
1 The proposed Reliability Standards are not
attached to this order. The proposed Reliability
Standards are available on the Commission’s
eLibrary document retrieval system in Docket No.
RD23–1–000 and on the NERC website,
www.nerc.com.
2 FERC, NERC, and Regional Entity Staff, The
February 2021 Cold Weather Outages in Texas and
the South Central United States, at 189 (Nov. 16,
2021), https://www.ferc.gov/media/february-2021cold-weather-outages-texas-and-south-centralunited-states-ferc-nerc-and (November 2021
Report).
3 Id.
4 NERC Petition at 7.
5 16 U.S.C. 824o(d)(5).
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obligated to serve’’ and ‘‘four hours or
more,’’ as well as the enumerated
exemptions, obfuscates the extent of
applicability of Reliability Standard
EOP–012–1 to bulk electric system 6
facilities, and may not ensure that
compliance is required for all
‘‘generating units that are being
depended upon to operate in cold
weather and on which the reliability of
the system depends.’’ 7 We understand
that the proposed applicability criteria
is meant to avoid ‘‘undue burden on
those generating units that are not
expected to operate in cold weather;’’ 8
however, we find that excluded
generating units should be the exception
and not the rule.9 Therefore, we direct
NERC, pursuant to FPA section
215(d)(5), to modify Reliability Standard
EOP–012–1 to ensure that it captures all
bulk electric system generation
resources needed for reliable operation
and excludes only those generation
resources not relied upon during
freezing conditions.10 As discussed
further below, our directive to NERC is
to clarify the language of the
applicability section to align with
NERC’s explanation of the entities that
should already be preparing to comply
with the Standard, and should not need
additional implementation time.
Therefore, NERC should ensure the
modified applicability section of
Reliability Standard EOP–012 is
implemented as of the effective date 11
of Reliability Standard EOP–012–1.
5. Further, as Reliability Standard
EOP–011–2 requirements to implement
and maintain cold weather
preparedness plan(s) and associated
training applies to all bulk electric
6 NERC’s Commission-approved bulk electric
system definition defines the scope of the
Reliability Standards and the entities subject to
NERC compliance. Revisions to Electric Reliability
Organization Definition of Bulk Electric System and
Rules of Procedure, Order No. 773, 141 FERC
¶ 61,236 (2012), order on reh’g, Order No. 773–A,
143 FERC ¶ 61,053 (2013) rev’d sub nom. People of
the State of New York v. FERC, 783 F.3d 946 (2d
Cir. 2015); NERC Glossary at 5–7.
7 NERC Petition at 30.
8 Id.
9 As discussed below, we also find that, even as
to the limited set of excluded generating units, the
obligation to have a cold weather emergency
preparedness plan(s) and training should remain.
10 16 U.S.C. 824o(d)(5) (stating that the
Commission, ‘‘upon its own motion or upon
complaint, may order the Electric Reliability
Organization 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 this section’’).
11 This order uses the term ‘‘effective date’’ to
mean the mandatory and enforceable date of the
Standards, which, according to NERC’s
implementation plan, is 18 months after regulatory
approval. NERC Petition at 50–51.
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system generating units, we defer our
decision on whether to approve or
modify NERC’s proposed
implementation date for Reliability
Standard EOP–011–3 (and proposed
retirement of Reliability Standard EOP–
011–2) until NERC submits its revised
applicability section for EOP–012.
Allowing EOP–011–2 requirements to
remain mandatory and enforceable until
such time as the revised applicability is
effective for EOP–012 will ensure all
bulk electric system generating units are
required to maintain cold weather
preparedness plans.
6. In addition, we direct NERC to
develop and submit modifications to
Reliability Standard EOP–012–1
Requirements R1 and R7 to address
concerns related to the ambiguity of
generator-defined declarations of
technical, commercial, or operational
constraints that exempt a generator
owner from implementing the
appropriate freeze protection measures.
We direct NERC to include in the
Standard: objective criteria on
permissible technical, commercial, and
operational constraints, to identify the
appropriate entity that would receive
the generator owners’ constraint
declarations under EOP–012–1
Requirements R1 and R7, to describe
how that entity would confirm that the
generator owners comply with the
objective criteria, and to describe the
consequences of providing a constraint
declaration. We direct NERC to modify
this Standard to ensure that declarations
cannot be used to opt out of mandatory
compliance with the Standard or
obligations set forth in a corrective
action plan. We direct NERC to submit
a revised Reliability Standard that
addresses these concerns no later than
12 months after the date of issuance of
this order.
7. Under Requirement R1 of EOP–
012–1, generator owners must
‘‘[i]mplement freeze protection
measures that provide capability to
operate for a period of not less than
twelve (12) continuous hours at the
Extreme Cold Weather Temperature’’ or
‘‘[e]xplain in a declaration any
technical, commercial, or operational
constraints . . . that preclude the ability
to implement appropriate freeze
protection measures to provide
capability of operating at twelve (12)
hours at the documented Extreme Cold
Weather Temperature.’’ 12 Yet, based on
comments and our reading of the plain
text of the Standard, we are concerned
that the requirement as written is
unclear whether new intermittent units
12 Reliability
Standard EOP–012–1, Requirement
R1.
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will be considered by all generator
owners as being capable of operating for
at least 12 continuous hours, and thus,
must comply with the Requirement.
Therefore, we direct NERC to modify
the Standard to clarify Reliability
Standard EOP–012–1 Requirement R1 to
ensure that generators that are
technically incapable of operating for 12
continuous hours (e.g., solar facilities
during winter months with less than 12
hours of sunlight) are not excluded from
complying with the Standard. We direct
NERC to submit the revised Reliability
Standard no later than 12 months after
the date of issuance of this order.
8. Under Requirement R2 of EOP–
012–1, each generator owner is required
to ‘‘ensure its generating unit(s) add
new or modify existing freeze protection
measures as needed to provide the
capability to operate for a period of not
less than one (1) hour at the unit(s)
Extreme Cold Weather Temperature.’’ 13
We find that the one-hour continuous
operations requirement in Reliability
Standard EOP–012–1 Requirement R2 is
too short of a period to adequately meet
the purpose of the Standard to ensure
generating units ‘‘mitigate the reliability
impacts of extreme cold weather.’’ 14
Thus, we direct NERC to modify the
one-hour continuous operations
requirement of Reliability Standard
EOP–012–1 Requirement R2. We direct
NERC to submit the revised Reliability
Standard no later than 12 months after
the date of issuance of this order.
9. In addition, Reliability Standard
EOP–012–1 does not require a deadline
for, or a maximum duration of,
corrective action plan implementation
completion. We are concerned that the
lack of a time limit for implementation
completion of corrective action plans
could allow identified issues to remain
unresolved for a significant and
indefinite period. Therefore, we direct
NERC pursuant to FPA section
215(d)(5), to modify Reliability Standard
EOP–012–1 Requirements R7 to include
deadlines for implementation
completion of corrective action plans, as
recommended in the November 2021
Report.15 We direct NERC to submit the
13 Reliability
Standard EOP–012–1, Requirement
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R2.
14 NERC Petition at 29 (noting that freeze
protection measures of the Standard would advance
the reliability of the Bulk-Power System by helping
to improve generator reliability in cold weather).
15 See, e.g., November 2021 Report at 187
(discussing Key Recommendation 1d, which, while
recommending that the standards drafting team
have flexibility to determine the specific timing for
the corrective action plan to be developed and
implemented after the outage, derate or failure to
start, also recommends that the corrective action
plan ‘‘be developed as quickly as possible, and be
completed by no later than the beginning of the
next winter season.’’).
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revised Reliability Standard no later
than 12 months after the date of
issuance of this order.
10. Additionally, we are concerned
that generator owners will not have to
implement freeze protection measures
for existing generating units to provide
them with the capability to operate for
the specified durations at the Extreme
Cold Weather Temperature under
proposed EOP–012–1 Requirement R2
until 60 months from regulatory
approval. Thus, we direct NERC to
modify the EOP–012–1 60-month
implementation plan for existing
generating units. Although we are giving
NERC the discretion to determine what
the effective date should be shortened
to, we also emphasize that industry has
been aware of and alerted to the need to
prepare their generating units for cold
weather since at least 2011.16 This
finding was repeated in the 2019 South
Central Event Report 17 and the
November 2021 Report.18 After the 2019
South Central Event Report, it was
found that one third of the generator
owners and operators surveyed ‘‘still
had no winterization provisions after
multiple recommendations on winter
preparedness for generating units.’’ 19
NERC should consider the amount of
time that industry has already had to
implement freeze protection measures
when determining the appropriate
implementation period. Further, we find
that a phased compliance within the
implementation time for Reliability
Standard EOP–012–1 Requirement R2
will also reduce reliability risks. To
address these concerns, we direct NERC
to modify the EOP–012–1
implementation plan for Requirement
R2 to require a staggered
implementation for existing unit(s) in a
generator owner’s fleet with an effective
16 See, e.g., FERC and NERC Staff, Report on
Outages and Curtailments During the Southwest
Cold Weather Event of February 1–5, 2011: Causes
and Recommendations, at 208 (Aug. 2011), https://
www.ferc.gov/sites/default/files/2020-07/
OutagesandCurtailmentsDuringtheSouthwest
ColdWeatherEventofFebruary1-5-2011.pdf
(recommending that each generator owner and
operator should take steps to ensure that
winterization is in place before the inter season and
take preventative action in a timely manner).
17 FERC and NERC Staff, The South Central
United States Cold Weather Bulk Electric System
Event of January 17, 2018, at 80–81 (July 2019),
https://www.ferc.gov/sites/default/files/legal/staffreports/2019/07-18-19-ferc-nerc-report.pdf (finding
that the event was ‘‘caused by failure to properly
prepare or ‘winterize’ the generation facilities for
cold temperatures’’).
18 November 2021 Report at 185 (finding that
‘‘generation freezing issues were the number one
cause of the Event, and the same frequently-seen
frozen components reappear’’).
19 Id.
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date of less than 60 months from
regulatory approval.20
11. We also find it necessary that
NERC ensure that Reliability Standard
EOP–012–1 adequately addresses the
reliability concerns related to generator
owner constraint declarations, the
adequacy of the Extreme Cold Weather
Temperature definition, and determine
whether future modification is needed,
as discussed in more detail below. We
note that, under the proposed
implementation plan, it will be five
years before certain requirements will
be effective and a longer period before
experiential data will be available.
Notwithstanding our directives to
shorten the implementation period for
certain Requirements, waiting to collect
data until after implementation will not
provide timely information on the
effectiveness of winterization efforts.
However, section 1600 of NERC’s Rules
of Procedure provides a mechanism for
data collections that could be used
during the period prior to full
implementation. Therefore, we direct
NERC, pursuant to section 39.2(d) of the
Commission’s regulations,21 to work
with Commission staff to submit a plan
no later than 12 months after the date
of issuance of this order explaining how
it will collect and assess data prior to
and after the implementation of the
following elements of Reliability
Standard EOP–012–1: (1) generator
owner declared constraints and
explanations thereof; and (2) the
adequacy of the Extreme Cold Weather
Temperature definition.
I. Background
A. Section 215 and Mandatory
Reliability Standards
12. Section 215 of the FPA provides
that the Commission may certify an
ERO, the purpose of which is to develop
mandatory and enforceable Reliability
Standards, subject to Commission
review and approval.22 Reliability
Standards may be enforced by the ERO,
subject to Commission oversight, or by
the Commission independently.23
Pursuant to section 215 of the FPA, the
Commission established a process to
20 See e.g., Generator Verification Reliability
Standards, Order No. 796, 146 FERC ¶ 61,213, at PP
1–2 (2014) (approving Reliability Standard MOD–
025–2 and its associated staggered implementation
plan, which required 40% of applicable facilities to
be verified in 2 years, 60% in 3 years, 80% in 4
years, and 100% in 5 years).
21 18 CFR 39.2(d) (2021) (the ERO shall provide
the Commission such information as is necessary to
implement section 215 of the FPA).
22 16 U.S.C. 824o(c).
23 Id. § 824o(e).
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select and certify an ERO,24 and
subsequently certified NERC.25
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B. The February 2021 Cold Weather
Reliability Event
13. On February 16, 2021, the
Commission, NERC, and Regional Entity
staff initiated a joint inquiry into the
circumstances surrounding a February
2021 cold weather reliability event that
affected Texas and the South-Central
United States that culminated in a
report identifying, among other things,
recommendations for Reliability
Standard improvements.26 The
November 2021 Report found that the
February 2021 cold weather reliability
event was the largest controlled firm
load shed event in U.S. history; over 4.5
million people lost power and at least
210 people lost their lives during the
event.27 The November 2021 Report
provided an assessment of the event as
well as recommendations including,
inter alia, Reliability Standard
enhancements to improve extreme cold
weather operations, preparedness, and
coordination.28
14. After the February 2021 cold
weather reliability event, but before the
November 2021 Report was issued,
NERC filed a petition for approval of
cold weather Reliability Standards
addressing recommendations from a
2018 cold weather event report.29 In
August 2021, the Commission approved
NERC’s modifications to Reliability
Standards EOP–011–2 (Emergency
Preparedness and Operations), IRO–
010–4 (Reliability Coordinator Data
Specification and Collection), and TOP–
003–5 (Operational Reliability Data).30
Reliability Standards IRO–010–4 and
TOP–003–5 require that reliability
coordinators, transmission operators,
and balancing authorities develop,
maintain, and share generator cold
weather data.31 EOP–011–2 requires
generator owners to have generating
unit cold weather preparedness plans
and generator owners and generator
24 Rules Concerning Certification of the Elec.
Reliability Org.; & Procs. for the Establishment,
Approval, & Enforcement of Elec. Reliability
Standards, Order No. 672, 114 FERC ¶ 61,104, order
on reh’g, Order No. 672–A, 114 FERC ¶ 61,328
(2006).
25 N. Am. Elec. Reliability Corp., 116 FERC
¶ 61,062, order on reh’g and compliance, 117 FERC
¶ 61,126 (2006), aff’d sub nom. Alcoa, Inc. v. FERC,
564 F.3d 1342 (D.C. Cir. 2009).
26 See November 2021 Report at 9.
27 Id.
28 Id. at 184–212 (sub-recommendations 1a
through 1j).
29 2019 South Central Event Report at 89.
30 See generally Order Approving Cold Weather
Reliability Standards, 176 FERC ¶ 61,119 (2021)
(noting that the standards become enforceable on
April 1, 2023).
31 Id.
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operators to provide training for
implementing the cold weather
preparedness plans.32
C. NERC’s Petition and Proposed
Reliability Standards EOP–011–3 and
EOP–012–1
15. On October 28, 2022, NERC filed
a petition seeking approval on an
expedited basis of Reliability Standards
EOP–011–3 and EOP–012–1, the
Standards’ associated violation risk
factors and violation severity levels,
three newly-defined terms (Extreme
Cold Weather Temperature, Generator
Cold Weather Critical Component, and
Generator Cold Weather Reliability
Event), NERC’s proposed
implementation plan, and the
retirement of currently approved EOP–
011–2.33 NERC explains that Reliability
Standards EOP–011–3 and EOP–012–1
build upon the 2021-approved cold
weather Reliability Standards by further
strengthening the reliability of the BulkPower System during extreme cold
weather conditions.34 NERC maintains
that proposed Reliability Standards
EOP–011–3 and EOP–012–1 are
consistent with key recommendations
for standards’ improvement from the
November 2021 Report.35 Specifically,
NERC states that the proposed
Reliability Standards contain new and
revised requirements to advance the
reliability of the Bulk-Power System
through the implementation of freeze
protection measures, enhanced weather
preparedness plans, annual training,
and the coordination of manual and
automatic load shed.36
16. NERC states that the purpose of
proposed Reliability Standard EOP–
011–3 is to ensure that each
transmission operator implements plans
to mitigate operating emergencies and
that such plans are coordinated within
the reliability coordinator area.
According to NERC, proposed
Reliability Standard EOP–011–3
addresses Key Recommendation 1j from
the November 2021 Report, which
recommends that the circuits used for
manual load shed be separated from the
circuits used for automatic load shed or
for critical loads.37
17. NERC proposes to modify
approved Reliability Standard EOP–
32 Id.
33 NERC
Petition at 1–2.
34 Id.
35 Id. at 23; see also November 2021 Report at
184–92, 208–10 (Key Recommendations 1b, 1d, 1e,
1f, and 1j).
36 NERC Petition at 23.
37 See id. at 20 (citing the November 2021 Report
at 208–10 (recommending that transmission
operators use automatic load shed as a last resort)).
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14997
011–2 in multiple ways.38 First, NERC
proposes to remove Requirements R7
and R8 (generator cold weather
preparedness plans and associated
training) from EOP–011–2 and
incorporate them into proposed
Reliability Standard EOP–012–1 as
Requirements R3 and R5, respectively.39
Second, the added Requirements R1 and
R2 of EOP–011–3 require that
transmission operator emergency
operating plans include provisions that
minimize the overlap of manual load
shed circuits, circuits that serve critical
loads, and circuits that are used for
underfrequency load shedding (UFLS)
or undervoltage load shedding
(UVLS).40 Third, Requirement R1
requires the development of provisions
that limit manual load shed of UFLS or
UVLS circuits to situations warranted
by system conditions.41 Finally,
Requirement R2 adds provisions for
transmission operators to implement the
operator-controlled manual load shed in
accordance with Requirement R1. NERC
also requests that the currently
approved Reliability Standard EOP–
011–2, which will go into effect on
April 1, 2023, be retired immediately
prior to the effective date of Reliability
Standard EOP–011–3 and EOP–012–1,
i.e., 18 months after regulatory
approval.42
18. NERC requests approval of a new
Reliability Standard, EOP–012–1, which
it states is meant to apply to generator
owners and operators of generating
units that are depended upon to operate
during cold weather and Blackstart
Resources. The purpose of Reliability
Standard EOP–012–1 is to ensure that
each generator owner develops and
implements plans to alleviate the
reliability effects of extreme cold
weather on its generating units.43
According to NERC, this new Reliability
Standard addresses parts of Key
Recommendation 1a as well as 1d, 1e,
and 1f of the November 2021 Report.44
19. Proposed Reliability Standard
EOP–012–1 has seven requirements, five
of which are new (Requirements R1, R2,
R4, R6, and R7) and two of which
(Requirements R3 and R5) were moved
and revised from approved Reliability
Standard EOP–011–2. Reliability
38 Reliability Standard EOP–011–3, Requirements
R3, R4, and R5 are unchanged from the approved
version. See Order Approving Cold Weather
Reliability Standards, 176 FERC ¶ 61,119
(approving EOP–011–2).
39 Id.; NERC Petition at 45–46.
40 NERC Petition at 46–49.
41 Id. Ex. A–1, at 2–3.
42 NERC Petition at 50.
43 Id. at 29.
44 See id. at 17–18 (citing the November 2021
Report at 184–89).
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Standard EOP–012–1 Requirements R1
and R2 address a generator owner’s
obligation to implement freeze
protection measures on its applicable
units to provide them with the
capability to operate at the Extreme
Cold Weather Temperature for the unit’s
location.45 Specifically, Requirement R1
requires either new units to be capable
of operating at the Extreme Cold
Weather Temperature for a continuous
12-hour period or that the generator
owner declares that technical,
commercial, or operational constraints
prevent successful continuous
operation. Requirement R2 requires
either that existing units be capable of
continuous operation for at least one
hour at the Extreme Cold Weather
Temperature or the generator owner to
develop a corrective action plan to
address the unit’s inability to
continuously operate successfully.46
20. Reliability Standard EOP–012–1
Requirements R3 and R5 require
generator owners to implement cold
weather preparedness plans
(Requirement R3) and train their
personnel on that plan annually
(Requirement R5).47 Requirement R3
also identifies the generator owner as
the entity responsible for identifying the
Extreme Cold Weather Temperature and
Generator Cold Weather Critical
Components for its unit(s); the generator
owner must document both in its cold
weather preparedness plan(s).
21. Reliability Standard EOP–012–1
Requirement R4 requires the generator
owner to review its Extreme Cold
Weather Temperature calculation, cold
weather preparedness plan(s), and
freeze protection measures every five
years to determine if changes or updates
are warranted.48 Requirement R6
mandates that each generator owner
experiencing an outage, failure to start,
or derate due to freezing conditions
develop a corrective action plan to
address the identified causes. Lastly,
Requirement R7 requires generator
45 Id.
at 33–37.
defines the term ‘‘corrective action plan’’
as a ‘‘list of actions and an associated timetable for
implementation to remedy a specific problem.’’
NERC, Glossary of Terms Used in NERC Reliability
Standards, 11 (Dec. 2022) (NERC Glossary), https://
www.nerc.com/pa/Stand/GlossaryofTerms/
Glossary_of_Terms.pdf. See also Reliability
Standard EOP–012–1, section 4.3.
47 NERC Petition at 37–41 (stating that
Requirements R3 and R5 were taken from
Requirements R7 and R8 from Commission
approved EOP–011–2 with modifications to ensure
that a generator owner’s cold weather preparedness
plan includes the Extreme Cold Weather
Temperature, Generator Cold Weather Critical
Components, and freeze protection measures).
48 Id. at 39–40 (this periodic review may require
the generator owner to add or modify existing freeze
protection measures to continue reliable operation).
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owners to implement corrective action
plans developed pursuant to
Requirements R2, R4, or R6, or explain
in a declaration why they are not
implementing corrective actions due to
technical, commercial, or operational
constraints.49
22. NERC requests the Commission
approve the violation risk factors and
violation severity levels for Reliability
Standards EOP–011–3 and EOP–012–1.
NERC states that the violation risk
factors and violation severity levels for
Reliability Standard EOP–011–3 did not
change from approved Reliability
Standard EOP–011–2. NERC also
proposes violation risk factors and
violation severity levels for new
Reliability Standard EOP–012–1.50
23. NERC proposes an 18-month
effective date for Reliability Standards
EOP–011–3 and EOP–012–1, beginning
on the first day of the first calendar
quarter following regulatory approval.51
All the requirements of Reliability
Standard EOP–011–3 would be effective
on this date.
24. Specific to the requirements of
EOP–012–1, as of the effective date,
generator owners will be required to
update their cold weather preparedness
plans to include the Extreme Cold
Weather Temperature and Generator
Cold Weather Critical Components, and
document freeze protection measures
for those components as required by
EOP–012–1 Requirement R3 as well as
provide unit-specific cold weather plan
training on an annual basis as required
by Requirement R5. Within 150 days of
the effective date, generator owners will
be required to develop corrective action
plans, or declare constraints, as required
by proposed EOP–012–1 Requirements
R6 and R7. NERC also proposes that
generator owners have an additional 42
months from the effective date of
proposed Reliability Standard EOP–
012–1 (i.e., 60 months from the
regulatory approval date) to come into
compliance with the new freeze
protection measures of EOP–012–1
Requirements R1 and R2 and an
additional 60 months from the effective
date (i.e., 78 months from the regulatory
approval date) to perform the first reevaluation of the Extreme Cold Weather
Temperature for their units and update
cold weather preparedness plans and
unit freeze protection measures,
including developing any corrective
49 Id. at 43–45 (noting that the generator owner
defines these constraints).
50 Id. Ex. E at 7–20 (explaining NERC’s
justifications for each violation risk factor and
violation severity level associated with Reliability
Standard EOP–012–1).
51 NERC Petition at 50–51.
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action plans, as needed for proposed
EOP–012–1 Requirement R4.
25. NERC explains that it considered
these implementation timeframes
necessary for generator owners to
calculate the Extreme Cold Weather
Temperature for each generating unit, to
identify Generator Cold Weather Critical
Components, and to perform the
necessary engineering studies and
analyses to identify and implement
freeze protection measures that would
provide for the required performance
capability or to explain why such
measures are precluded by technical,
commercial, or operational constraints.
NERC also states that generator owners
need additional time to implement the
freeze protection measures of EOP–012–
1 Requirements R1 and R2 because of
the significant engineering, design,
analysis, and implementation efforts
required to complete such work.52
26. NERC explains that it adopted a
two-phase standard development
project to develop, draft, and revise the
extreme cold weather Reliability
Standards in accordance with the
November 2021 Report due to the
extensive scope and demonstrated
urgency of new and improved cold
weather Reliability Standards.53 NERC
states that its October 28, 2022, petition
represents phase one of its standard
development project and that the
remaining November 2021 Report
recommendations will be addressed in
the second phase of standards
development. In phase two, NERC states
that its standard drafting team also
plans to consider industry concerns that
arose in phase one.
27. Finally, NERC requests the
Commission approve the proposed
Standards in an expedited manner.
NERC explains that, among other things,
an expedited approval would provide
regulatory certainty to entities seeking
to implement the Standards ahead of the
mandatory and enforceable dates.54
II. Notice of Filing and Responsive
Pleadings
28. Notice of NERC’s October 28,
2022, Petition was published in the
Federal Register, 87 FR 67464 (Nov. 8,
2022), with comments, protests, and
motions to intervene due on or before
December 1, 2022.
29. On November 17, 2022, the
Electric Power Supply Association
(EPSA) filed a motion for an extension
of time to submit comments. On
52 Id.
at 52.
at 53 (noting that NERC anticipates
completing development and filing with the
Commission new or revised Reliability Standards
by November 1, 2023).
54 Id. at 55.
53 Id.
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November 29, 2022, the Commission
extended the comment period seven
days to and including December 8,
2022.
30. The Commission received six sets
of comments and five reply comments.
The LS Power Development, LLC;
Calpine Corporation; EPSA; PJM Power
Providers Group (PJM Group);
Transmission Access Policy Study
Group (TAPS); the National Rural
Electric Cooperative Association
(NRECA); American Public Power
Association (APPA); the Independent
System Operators and Regional
Transmission Organization Council
(ISO/RTO Council); Edison Electric
Institute (EEI); New England Power
Generators Association, Inc. (NEPGA);
and Invenergy LLC (Invenergy) filed
timely motions to intervene. TAPS, the
ISO/RTO Council, NEPGA, Invenergy,
EPSA/PJM Group jointly, and the Texas
Competitive Power Advocates (TCPA)
filed timely comments. NERC filed reply
comments out of time. Invenergy filed a
motion for leave to reply and reply
comments out of time. NEPGA/EPSA/
PJM Group filed a joint out of time
motion for leave to answer and joint
answer to the ISO/RTO Council’s
comments. APPA/TAPS filed a joint out
of time motion for leave to answer along
with a joint answer to EPSA’s
comments. The ISO/RTO Council also
filed an out of time motion for leave to
answer along with an answer to the
NERC’s reply comments and NEPGA/
EPSA/PJM Group’s answer.
31. Commenters either did not
address or were generally supportive of
NERC’s proposed modifications to
Reliability Standard EOP–011–3.55
Commenters raised concerns and
requests for clarifications for NERC’s
proposed Reliability Standard EOP–
012–1. The commenters range in their
support for Reliability Standard EOP–
012–1 from requesting that the
Commission approve the Standard as
filed with minor clarifications 56 to
remanding the Standard to NERC with
directives.57 The comments on specific
matters are summarized and addressed
in the determinations below.
III. Determination
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A. Procedural Matters
32. Pursuant to Rule 214 of the
Commission’s Rules of Practice and
55 E.g., EPSA/PJM Group Comments at 3; NEPGA/
EPSA/PJM Group Answer at 1; ISO/RTO Council
Comments at 1–2, TAPS Comments at 1.
56 See APPA/TAPS Answer at 2–9; ISO/RTO
Comments at 1–3; ISO/RTO Answer at 1–2; TAPS
Comments at 1.
57 See EPSA/PJM Group Comments at 2–4;
Invenergy Comments at 2, 13; NEPGA Comments at
2, 6–8; TCPA Comments at 2, 5–6.
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Procedure, 18 CFR 385.214 (2021), the
timely, unopposed motions to intervene
serve to make the entities that filed
them parties to this proceeding.
33. Rule 213(a)(2) of the
Commission’s Rules of Practice and
Procedure, 18 CFR 385.213(a)(2) (2021),
prohibits an answer to a protest or
answer unless otherwise ordered by the
decisional authority. Pursuant to Rule
214(d) of the Commission’s Rules of
Practice and Procedure, 18 CFR
385.214(d), we grant NERC and
Invenergy’s leave to file their late-filed
reply comments given their interest in
the proceeding and the absence of
undue prejudice or delay. We also grant
APPA/TAPS, NEPGA/EPSA/PJM Group,
and the ISO/RTO Council’s motions for
leave to file out of time answers and we
accept their answers because they have
provided information that assisted us in
our decision-making process.
B. Substantive Matters
34. Pursuant to section 215(d)(2) of
the FPA, we approve Reliability
Standards EOP–011–3 and EOP–012–1
as just, reasonable, not unduly
discriminatory or preferential and in the
public interest. As discussed in this
order, we approve proposed Reliability
Standards EOP–011–3 and EOP–012–1,
their associated violation risk factors
and violation severity levels, the newly
defined terms Generator Cold Weather
Critical Component, Extreme Cold
Weather Temperature, and Generator
Cold Weather Reliability Event. We
defer our decision on whether to
approve or modify NERC’s proposed
implementation date for Reliability
Standard EOP–011–3 (and proposed
retirement of Reliability Standard EOP–
011–2) until NERC submits its revised
applicability section for EOP–012, as
discussed in more detail below. Absent
the reforms adopted in Reliability
Standards EOP–011–3 and EOP–012–1,
the existing defects and inefficiencies
exhibited during extreme cold weather
conditions could be exacerbated and
negatively affect reliability.
35. We find that Reliability Standard
EOP–011–3 is an improvement over the
2021-approved cold weather Reliability
Standards and enhances reliability by
improving how transmission operators
account for the overlap of manual load
shed and automatic load shed in their
emergency operating plans while also
addressing the need to minimize the use
of manual load shed that could further
exacerbate emergencies and threaten
system reliability. Commenters did not
express concern with Reliability
Standard EOP–011–3. Accordingly, we
approve Reliability Standard EOP–011–
3.
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36. We find that Reliability Standard
EOP–012–1 represents an improvement
to the Reliability Standards and
enhances the reliable operation of the
Bulk-Power System by requiring
generator owners to implement freeze
protection measures, develop enhanced
cold weather preparedness plans,
implement annual trainings, draft and
implement corrective action plans to
address freezing issues, and provide
certain cold weather operating
parameters to reliability coordinators,
transmission operators, and balancing
authorities for use in their analyses and
planning. We believe that these
measures begin to address many of the
issues identified as contributing to
generating unit failures during extreme
cold weather conditions, as noted in the
November 2021 Report.58 We also
appreciate that NERC completed the
modifications and development of
Reliability Standards EOP–011–3 and
EOP–012–1 in a timely manner.
37. Several commenters express
concern regarding ambiguities in
Requirements R1 and R7 of Reliability
Standard EOP–012–1 pertaining to the
generator owner declarations for
‘‘technical, commercial, or operational
constraints’’ and ask the Commission to
remand the Standard with direction to
NERC for clarifications.59 As discussed
below, we agree that the provisions are
ambiguous. However, we are not
persuaded that there is sufficient cause
to remand Reliability Standard EOP–
012–1. Since we find that the Standard
enhances the reliable operation of the
Bulk-Power System, we conclude that
the better course is to approve
Reliability Standard EOP–012–1 so that
it will take effect in a timely manner.
Nevertheless, pursuant to our authority
under FPA section 215(d)(5), we also
direct NERC to develop modifications to
address the concerns regarding
Requirements R1 and R7, as well as
other concerns we have identified as to
other aspects of Reliability Standard
EOP–012–1, without delaying the
effective date of Reliability Standard
EOP–012–1. This approach is consistent
with Commission precedent.60
58 See
November 2021 Report at 184–210.
e.g., EPSA/PJM Group Comments at 7–9;
ISO/RTO Council Comments at 10; NEPGA
Comments at 7–8.
60 See e.g., Mandatory Reliability Standards for
the Bulk-Power Sys., Order No. 693, 118 FERC
¶ 61,218, at P 10 (2007) (noting that ‘‘[w]here a
Reliability Standard requires significant
improvement, but is otherwise enforceable, the
Commission approves the Reliability Standard’’ and
‘‘directs the ERO to modify’’ such Standards to
address identified issues or concerns); Version 5
Critical Infrastructure Prot. Reliability Standards,
Order No. 791, 145 FERC¶ 61,160, at PP 1–4 (2013),
59 See
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38. While we understand that the
implementation plan for Reliability
Standard EOP–012–1 is designed to
accommodate entities that may need
time to determine Extreme Cold
Weather Temperature values, identify
cold weather critical components for
applicable generating units, develop
corrective action plans for freeze issues,
perform various engineering analyses,
provide the required training, and
develop the necessary capabilities to
satisfy revised data specifications,
industry has been aware of and alerted
to the need to prepare their generating
units for cold weather since at least
2011. Therefore, we direct NERC to
reduce the implementation time and to
include a staggered implementation for
Requirement R2 to reduce reliability
risks. NERC should consider the amount
of time that industry has already been
alerted to the need to implement freeze
protection measures when determining
the appropriate implementation period.
We also strongly encourage entities that
are capable of complying with these
Standards earlier than the mandatory
and enforceable date to do so.
39. In addition to the directives to
modify various aspects of Reliability
Standard EOP–012–1, we also have
concerns regarding generator owner
constraint declarations and the
adequacy of the Extreme Cold Weather
Temperature definition that may be
addressed with additional information.
Therefore, pursuant to section 39.2(d) of
the Commission’s regulations,61 NERC
is hereby directed to work with
Commission staff to submit a plan no
later than 12 months after the date of
issuance of this order on how it will
collect and assess, through annual and
event-based data submittals, the
following elements of Reliability
Standard EOP–012–1: (1) generator
owner declared constraints and
explanations thereof; and (2) the
adequacy of the Extreme Cold Weather
Temperature definition. NERC is hereby
directed to submit periodic reports to
the Commission providing the results of
the assessments, as discussed in further
detail below.
40. Below we address the following
elements of Reliability Standard EOP–
012–1: (1) jurisdiction; (2) the
applicability of Reliability Standard
EOP–012–1; (3) generator owner
declarations for technical, commercial,
or operational constraints; (4) the
Extreme Cold Weather Temperature
definition; (5) the absence of a deadline
by which generator owners must
implement new or modified freeze
protection measures required by their
corrective action plans; (6) cost recovery
mechanisms; (7) other technical matters;
and (8) annual and event-based data
submittals.
1. Jurisdiction
a. Background
41. Section 215(a)(3) of the FPA
defines ‘‘Reliability Standard’’ as:
a requirement, approved by the Commission
under this section, to provide for reliable
operation of the bulk-power system. The term
includes requirements for the operation of
existing bulk-power system facilities,
including cybersecurity protection, and the
design of planned additions or modifications
to such facilities to the extent necessary to
provide for reliable operation of the bulkpower system, but the term does not include
any requirement to enlarge such facilities or
to construct new transmission capacity or
generation capacity.62
42. The term ‘‘Reliable Operation’’ is
defined by the statute as ‘‘operating the
elements of the bulk-power system
within equipment and electric system
thermal, voltage, and stability limits so
that instability, uncontrolled separation,
or cascading failures of such system will
not occur as a result of a sudden
disturbance . . . or unanticipated
failure of system elements.’’ 63
b. Comments
43. EPSA/PJM Group and Invenergy
assert that Requirements R1 and R2 of
Reliability Standard EOP–012–1 would
impose obligations on generator owners
that ‘‘fall outside of the scope’’ of
section 215 of the FPA.64 Both
provisions of Reliability Standard EOP–
012–1 require generator owners to add
new, or modify existing, freeze
protection measures, with Requirement
R1 pertaining to generating units with
an operational date subsequent to the
effective date of the Reliability
Standard, and Requirement R2
pertaining to existing generating units.
44. EPSA/PJM Group argue that while
the definition of Reliable Operation
allows NERC to require modifications to
address sudden disturbances and
unanticipated failures, ‘‘the language of
the section is very clear that a
Reliability Standard may only cover ‘the
operation’ of existing facilities, where
such operation shall only be ‘within’
equipment limits exclusively for the
purpose of mitigating ‘sudden
disturbances’ and ‘unanticipated
failures.’ ’’ 65 In other words, according
U.S.C. 824o(a)(3).
§ 824o(a)(4).
64 See EPSA/PJM Group Comments at 5–7;
Invenergy Comments at 13.
65 Id. (footnotes omitted).
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c. Commission Determination
46. We are not persuaded by EPSA/
PJM Group and Invenergy’s arguments
and conclude that Reliability Standard
62 16
63 Id.
order on clarification and reh’g, Order No. 791–A,
146 FERC ¶ 61,188 (2014).
61 18 CFR 39.2(d).
to EPSA/PJM Group, the statute
authorizes the modification of existing
facilities to reliably operate within their
existing equipment limits but does not
permit a Reliability Standard that
changes a resource’s equipment limits.66
In the same vein, Invenergy asserts that
it is unclear whether NERC has the
authority under section 215 of the FPA
to mandate retrofits on existing
generators because the statutory
definition of Reliability Standard is
limited to requirements ‘‘for the
operation of existing bulk-power system
facilities.’’ 67 According to Invenergy,
this language suggests that NERC can
only mandate modifications when
changes to a facility are already
planned.68
45. In its reply comments, NERC
asserts that the requirements of
Reliability Standard EOP–012–1 that
generator owners add freeze protection
measures is within the scope of its
authority and that commenters argue for
an overly narrow interpretation of
section 215 of the FPA.69 According to
NERC, EOP–012–1 satisfies a three-part
framework for analyzing whether a
proposed Reliability Standard is within
the ERO’s authority under the statute,
namely that the Standard: (1) applies to
users, owners or operators of the BulkPower System; (2) provides for the
reliable operation of the Bulk-Power
System; and (3) may include operational
or design requirements, but may not
address matters expressly excluded in
the statute that were historically left to
the jurisdiction of the states. Focusing
on the third prong, NERC explains that
Reliability Standard EOP–012–1
pertains to the operation of existing
facilities and the design of planned
additions or modifications to such
facilities as needed to provide for the
reliable operation of the Bulk-Power
System, which is explicitly included in
the statutory definition of Reliability
Standard. NERC argues that, while the
statutory definition of Reliability
Standard specifically excludes ‘‘any
requirement to enlarge [existing]
facilities or to construct new
transmission capacity or generation
capacity,’’ EPSA/PJM Group’s narrow
reading of the definition would write
into the statute a new exclusion that
does not exist.
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66 Id.
at 6.
67 Invenergy
Comments at 13.
68 Id.
69 NERC
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EOP–012–1 Requirements R1 and R2 are
within the statutory authority of the
ERO and the Commission. We agree
with NERC that EPSA/PJM Group and
Invenergy narrowly interpret the terms
‘‘Reliability Standard’’ and ‘‘Reliable
Operation’’ under section 215 of the
FPA to reach an inaccurate conclusion
regarding the ERO and the
Commission’s statutory authority.70
47. First, Requirements R1 and R2 of
EOP–012–1 comport with the statutory
definition of a Reliability Standard,
which includes modifications to
facilities to the extent that they are
necessary to provide for the reliable
operation of the Bulk-Power System.71
Reliability Standard EOP–012–1
Requirement R1 requires generating
units with a commercial operation date
after the effective date of the Standard
to implement freeze protection
measures so that the unit is capable of
continuous operation for at least 12
hours at the Extreme Cold Weather
Temperature or for the generator owner
to submit a declaration of a technical,
commercial, or operational constraint
that preclude its ability to comply with
the Standard. Requirement R2 of EOP–
012–1 requires existing generating units
to either be capable of continuous
operation for at least one hour at the
Extreme Cold Weather Temperature or
to develop a corrective action plan to
resolve the issue. Thus, Requirements
R1 and R2’s freeze protection provisions
serve an appropriate purpose, i.e., to
provide the ‘‘Reliable Operation’’ 72 of
the Bulk-Power System as set forth in
the definition of a ‘‘Reliability
Standard.’’ 73 Further, neither of these
requirements mandate the construction
of new generation capacity or an
expansion of the unit’s generating
capacity, which are the only relevant
exclusions identified in the statutory
definition of a ‘‘Reliability Standard.’’ 74
48. Moreover, we reject EPSA/PJM
Group’s interpretation of the statutory
definition of ‘‘Reliable Operation’’ as
imposing a limitation or exclusion on an
acceptable Reliability Standard. EPSA/
PJM Group recognizes that under the
definition of ‘‘Reliable Operation’’
NERC may require modifications to
mitigate ‘‘sudden disturbances’’ and
‘‘unanticipated failures’’ of facilities to
the extent necessary to provide for
reliable Bulk-Power System
operations.75 Indeed, the Commission
70 Id.;
see also 16 U.S.C. 824o(a)(3)–(4).
U.S.C. 824o(a)(3).
72 Id. section 824o(a)(4).
73 Id. section 824o(a)(3).
74 Id.
75 EPSA/PJM Group Comments at 5 (citing to 16
U.S.C. 824(a)(4)).
71 16
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has previously approved Reliability
Standards that require the
implementation of physical
modifications to improve reliability.76
Rather, EPSA/PJM Group reads a
limitation into the statutory definition
of Reliable Operation—specifically
‘‘within equipment . . . limits’’—and
argues that the proposed Reliability
Standard would constitute an
impermissible change to such
equipment limits. However, we do not
find this argument to be persuasive as
the statutory language is not as narrow
as EPSA/PJM Group suggests. When
read in context, the definition of
‘‘Reliable Operation’’ contemplates that
Reliability Standards should be
designed so that facility equipment
operates within specified limits to
mitigate sudden disturbances and
prevent unanticipated failures of system
elements.77
49. EPSA/PJM Group seizes upon
language from the ‘‘Reliability
Standard’’ definition stating that the
term ‘‘includes requirements for the
existing bulk-power system
facilities. . . .’’ 78 However, other than
EPSA/PJM Group’s assertion, there is no
logical reason to tie together the
language from these two definitions to
limit the statutory scope for the
requirements of a Reliability Standard.
Rather, in context, the ‘‘requirements for
operation of existing . . . facilities’’
passage continues ‘‘. . . including . . .
the design of planned additions or
modification to such facilities to the
extent necessary to provide for reliable
operation of the bulk-power system.’’ 79
This exactly describes the purpose of
the freeze protection requirements in
EOP–012–1, which are intended to
reduce capacity that is forced off-line
due to freezing conditions and to help
ensure that such capacity is not forced
off-line in newer units. Accordingly, we
reject the arguments of EPSA/PJM
Group that the requirements of EOP–
012–1 are beyond our or NERC’s
authority.
50. For similar reasons, we reject
Invenergy’s argument that a requirement
to ‘‘retrofit’’ existing generators exceeds
the statutory definition of a Reliability
Standard that is limited to requirements
‘‘for the operation of existing bulkpower system facilities.’’ 80 Again,
Invenergy would read in an exclusion
beyond the one explicit exclusion stated
in the definition. Moreover, Invenergy’s
selected quote ignores the language that
follows which includes requirements for
‘‘the operation of existing bulk-power
system facilities . . . and the design of
planned additions or modifications to
such facilities to the extent necessary to
provide for reliable operation of the
bulk-power system.’’ 81 As discussed
above, Requirements R1 and R2’s freeze
protection measures satisfy the latter
provision, as the record shows that
these modifications are necessary to
provide for the reliable operation of the
Bulk-Power System.
76 See, e.g., Order No. 693, 118 FERC ¶ 61,218 at
PP 1547, 1550 (approving Reliability Standard
PRC–018–1, which requires the installation of
disturbance monitoring equipment); Mandatory
Reliability Standards for Critical Infrastructure
Protection, Order No. 706, 122 FERC ¶ 61,040, at P
86 (2008) (providing entities with a reasonable
amount of time to purchase and install new
software and equipment for compliance);
PacifiCorp, 141 FERC ¶ 61,140 P 1 (2014).
77 16 U.S.C. 824o(a)(4).
78 EPSA/PJM Group Comments at 5.
79 16 U.S.C. 824o(a)(3).
80 See Invenergy Comments at 13. But see NERC
Petition Ex. A–2, at 3–8 (the term ‘‘retrofit’’ not
appearing in proposed Reliability Standard EOP–
012–1).
81 16 U.S.C. 824o(a)(3).
82 See NERC, Rules of Procedure, App. 3A
(Standard Process Manual), 5 (Mar. 2019), N. Am.
Elec. Reliability Corp., 116 FERC ¶ 61,062, order on
reh’g and compliance, 117 FERC ¶ 61,126 (2006),
aff’d sub nom. Alcoa, Inc. v. FERC, 564 F.3d 1342
(D.C. Cir. 2009).
83 Reliability Standard EOP–012–1, section
4.2.1.1.
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2. Applicability of Reliability Standard
EOP–012–1
51. NERC’s Rules of Procedure
requires all Reliability Standards to
include an applicability section that
identifies (1) the registered functional
entities required to comply with each
Standard and (2) the bulk electric
system facilities to which the
requirements apply.82 Reliability
Standard EOP–012–1’s applicability
section applies to registered generator
owners and generator operators.
Further, the facilities subject to the
requirements of the standard include
bulk electric system generating units
that are Blackstart Resources and any
bulk electric system generating unit
that:
commits or is obligated to serve a Balancing
Authority load pursuant to a tariff obligation,
state requirement as defined by the relevant
electric regulatory authority, or other
contractual arrangement, rule, or regulation,
for a continuous run of four hours or more
at or below a temperature of 32 degrees
Fahrenheit (zero degrees Celsius) 83
52. NERC explains that the facilities
section inclusions are ‘‘carefully
tailored to place the responsibility for
cold weather preparedness on those
generating units that are being
depended on to operate in cold weather
and on which the reliability of the
system depends’’ and that the facilities
section exclusions are meant to avoid
‘‘undue burden on those generating
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units that are not expected to operate in
cold weather.’’ 84
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a. Comments
53. Invenergy questions which
generator owner and generator operators
must comply with Reliability Standard
EOP–012–1. Specifically, Invenergy
asserts that the applicability section of
the Standard is not clear and
unambiguous as to which entities must
comply. Invenergy argues there are
different types of generator owners that
vary widely in how they, with their
generating units, participate in electric
markets, and requests that the
Commission direct NERC to modify
proposed Reliability Standard EOP–
012–1 to provide specific criteria for
which entities must comply.85
b. Commission Determination
54. We agree with Invenergy that the
applicability of Reliability Standard
EOP–012–1 is unclear and ambiguous.
In its technical rationale and
justification, NERC explains that
Reliability Standard EOP–012–1 is not
meant to require all generating units to
provide capacity in extreme cold
weather. Instead, the Standard applies
to those generating resources that are
‘‘obligated to serve Balancing Authority
load during periods at or below freezing
due to commitments pursuant to tariff
obligations, state requirements defined
by regulatory authorities, or other
contractual arrangements, rules, or
regulations are subject to the
winterization requirements.’’ 86 Further,
NERC explains that the ‘‘[t]he [standard
drafting team] chose the four-hour
timeframe in consideration of generators
that typically do not commit during
freezing conditions but are running
when conditions drop below freezing
for a short period of time . . . ’’ 87
Lastly, NERC states that the language is
intended to act as a ‘‘blanket inclusion
of all [bulk electric system] resources
that serve Balancing Authority load for
a period of more than four hours in
freezing conditions.’’ 88
55. Despite this additional description
regarding the standard drafting team’s
intent, we are concerned that certain
elements of the applicability criteria
remain unclear and ambiguous. For
example, in light of the multiple
different approaches for participating in
electricity markets, it may not be clear
under what circumstances a generator
owner is ‘‘obligated to serve a Balancing
84 NERC
Petition at 30.
Comments at 4.
86 NERC Petition, Ex. C–2, Technical Rationale
and Justification for EOP–012–1 at 1.
87 Id.
88 Id. at 2.
85 Invenergy
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Authority load.’’ 89 Similarly, while the
intent appears to be to exclude units
that do not typically run during winter,
it is unclear how the qualifier of ‘‘for
four hours or more’’ is meant to be
measured and applied in practice.
56. We find that NERC has not
sufficiently supported the applicability
criteria of EOP–012–1. Reliability
Standard EOP–012–1 applies only to
‘‘[a] Blackstart Resource’’ or ‘‘[a] Bulk
Electric System generating unit that
commits or is obligated to serve . . .
pursuant to a tariff obligation, state
requirement . . . , or other contractual
arrangement, rule, or regulation, for a
continuous run of four hours or more at
or below a temperature of 32 degrees
Fahrenheit (zero degrees
Celsius). . . .’’ 90 This applicability is
further limited by enumerated
exemptions set forth in section 4.2.2.
NERC explains in its Petition that the
Facilities section 4.2 of the Reliability
Standard, that limits applicability to an
unidentified subset of generating units,
is meant to ‘‘place the responsibility for
cold weather preparedness on those
generating units that are being
depended on to operate in cold weather
and on which the reliability of the
system depends, while avoiding undue
burden on those generating units that
are not expected to operate in cold
weather.’’ 91 But based on commenter
concerns and our reading of the plain
text of the Reliability Standard, the
extent of Reliability Standard EOP–012–
1’s applicability to bulk electric system
facilities is unclear.
57. For example, it is unclear how the
term ‘‘continuous run’’ would apply to
intermittent resources, which by their
nature are variable and, therefore, do
not always run continuously. Ensuring
clear applicability to intermittent
generators is critical to ensuring that
enough generating units are available
during cold temperatures.
58. Moreover, to the extent it is
NERC’s intent to exclude units that do
not typically run during winter from
every requirement in the Standard, we
have concerns that this is not clearly
articulated in Reliability Standard EOP–
012–1. In short, we are concerned that
use of the terms ‘‘continuous run,’’
‘‘commits or is obligated to serve’’ and
‘‘four hours or more,’’ as well as the
enumerated exemptions, obfuscates the
extent of applicability of Reliability
Standard EOP–012–1 and may not
ensure that compliance is required for
all ‘‘generating units that are being
depended on to operate in cold weather
89 Id.
at 1.
90 Reliability
91 NERC
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and on which the reliability of the
system depends.’’ 92 Therefore, we
direct NERC, pursuant to FPA section
215(d)(5), to modify Reliability Standard
EOP–012–1 to ensure that it captures all
bulk electric system generation
resources needed for reliable operation
and excludes only those generation
resources not relied upon during
freezing conditions.93 As the directive is
to clarify the language of the
applicability section to align with
NERC’s explanation of the entities that
should comply, there should be no need
for additional implementation time.
Therefore, NERC should ensure the
modified applicability is implemented
as of the effective date of Reliability
Standard EOP–012–1.
59. Given the lack of clarity in the
proposed applicability criteria for EOP–
012–1, we are concerned that the
standard could apply to significantly
fewer generators than the existing
Reliability Standard EOP–011–2
Requirements R7 and R8. Thus, as
Reliability Standard EOP–011–2
requirements to implement and
maintain cold weather preparedness
plan(s) and associated training applies
to all bulk electric system generating
units, we defer our decision on whether
to approve or modify NERC’s proposed
implementation date for Reliability
Standard EOP–011–3 (and proposed
retirement of Reliability Standard EOP–
011–2) until NERC submits its revised
applicability section for EOP–012.
Allowing these requirements to remain
mandatory and enforceable will ensure
all bulk electric system generating units
are required to maintain cold weather
preparedness plans until such time as
the revised applicability criteria are
effective for EOP–012.
60. Furthermore, we are concerned
that the proposed applicability criteria
for EOP–012–1 and retirement of EOP–
011–2 Requirements R7 and R8 will
eliminate valuable information on cold
weather preparedness of generating
units that typically do not operate
during the winter. Under EOP–011–2,
all bulk electric system generating units
must identify in cold weather
preparedness plan(s) ‘‘[g]enerating
unit(s) cold weather data’’ including
‘‘[g]enerating unit(s) operating
limitations in cold weather’’ and
92 Id.
at 30.
U.S.C. 824o(d)(5) (stating that the
Commission, ‘‘upon its own motion or upon
complaint, may order the Electric Reliability
Organization 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 this section’’).
93 16
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‘‘[g]enerating unit(s) minimum . . .
design temperature . . . historical
operating temperature . . . or current
cold weather performance temperature
determined by an engineering analysis.’’
This data is to be exchanged with the
reliability coordinator, transmission
operator, and balancing authority for
planning and operations. The November
2021 Report stated that ‘‘[t]he intent
behind requiring [generator owners] to
identify and share with the [balancing
authorities] and [transmission operators]
the expected limitations of their
generating units ‘during local forecasted
cold weather,’ is to prevent grid
operators from being surprised when
large numbers of generating units that
had committed to run are unable to do
so during cold weather events.’’ 94 Once
EOP–012–1 goes into effect, and EOP–
011–2 Requirements R7 and R8 are
retired, we are concerned that
generating units that do not typically
operate during the winter will no longer
provide this information to reliability
coordinators, transmission operators,
and balancing authorities. The loss of
this information concerns us as the
proposed applicability of EOP–012–1
recognizes that units that do not
typically run during the winter may be
called upon during emergencies. We
therefore direct NERC to modify EOP–
012–1 to ensure that this information
remains available.
3. The Allowance of Exceptions for
Generator Owner-Defined Technical,
Commercial, or Operational Constraints
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a. NERC Petition
61. Requirement R1 of EOP–012–1
requires a generator owner to either
implement freeze protection measures
on its existing units that provide
capability to operate for a period of not
less than 12 continuous hours at the
Extreme Cold Weather Temperature for
the unit or ‘‘[e]xplain in a declaration
any technical, commercial, or
operational constraints that preclude the
ability’’ to comply with the
requirement.95 Similarly, Requirement
R7 mandates that a generator owner
implement each corrective action plan
developed pursuant to Requirements
R2, R4, or R6 ‘‘or explain in a
declaration why corrective actions are
not being implemented due to any
technical, commercial, or operational
constraint as defined by the Generator
Owner.’’ 96
94 November
2021 Report at 190–91.
Petition Ex A–2, at 4.
96 Id. at 4–6.
95 NERC
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b. Comments
62. Several commenters assert that the
Requirements R1 and R7 in Reliability
Standard EOP–012–1 could benefit from
increased clarity. EPSA/PJM Group,
NEPGA, and the ISO/RTO Council
assert that the generator owner
declaration of constraints outlined in
Requirement R1 and Requirement R7
are overly broad and that there is no
explanation of what technical,
commercial, or operational constraints
would be permissible for generator
owners to avoid both the
implementation of freeze protection
measures and a corrective action plan.97
Specifically, EPSA/PJM Group contend
that the broad discretion towards
generator owners to identify constraints
in Requirements R1 and R7 may lead to
generator owners avoiding the
implementation of freeze protection
measures (to lower their costs), thereby
negatively interfering with
competition.98 The ISO/RTO Council
states that this generator owner
discretion to determine what constraints
are valid without oversight could make
enforcement difficult.99 Similarly,
Invenergy argues that this discretion
could lead to uneven implementation
and enforcement.100 TCPA also requests
that the Commission clarify that a lack
of cost recovery is a commercial
constraint to implementing Requirement
R1 and R7.101 Finally, commenters
point out that there is no indication in
the Standard of which entity should
receive the declaration of constraints
from the generator owner, if any.102
63. NERC, in its reply comments,
states that provisions criticized by
commenters including the ‘‘constraints’’
provision represents a balancing of
competing opinions raised in the
standards development process. NERC
opines that the petition provides a
sound technical basis for approving the
Standards as filed, and reiterates that
during the second phase project, ‘‘NERC
may propose further changes to enhance
the clarity or effectiveness of the EOP–
012 standard.’’ 103
c. Commission Determination
64. We share commenters’ concerns
regarding the uncertainty created by the
proposed technical, commercial, or
operational constraint provisions in
97 EPSA/PJM Group Comments at 7–9; ISO/RTO
Council Comments at 10; NEPGA Comments at 7–
8.
98 EPSA/PJM Group Comments at 7–9.
99 ISO/RTO Council Comments at 10–11.
100 Invenergy Comments at 8.
101 TCPA Comments at 2–3, 7–8.
102 E.g., ISO/RTO Council Comments at 10.
103 NERC Reply Comments at 13.
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Requirements R1 and R7, and that
without criteria to guide the generator
owners, or guardrails on what
constitutes a legitimate technical,
commercial, or operational constraint,
entities may either benefit financially by
avoiding the purpose of the Standard
altogether or have declarations without
auditable elements.104 Indeed, instead
of implementing freeze protection
measures, Requirement R1 allows an
entity to explain in a declaration the
constraints that preclude the ability to
comply. Requirement R7 allows an
entity to explain in a declaration any
technical, commercial, or operational
constraints as defined by the generator
owner that prevent its implementation
of corrective actions set forth in a
corrective action plan pursuant to
Requirements R2, R4 and R6. We are
also concerned that a generator owner
may make the determination without
informing planning and operational
entities (i.e., the reliability coordinator
or balancing authority) that are
expecting the reliable operation of the
generating unit to its Extreme Cold
Weather Temperature.
65. The Commission has previously
encountered similar concerns regarding
the vagueness and enforceability of
Reliability Standards language. For
example, in Order No. 693 the
Commission approved Reliability
Standards while also expressing
concern that the term ‘‘sabotage’’ was
too ambiguous.105 Similarly, in Order
No. 791 (approving Version 5 of the CIP
Standards), the Commission raised
concerns with vague language that
required entities to ‘‘identify, assess,
and correct’’ deficiencies. The
Commission determined that the
ambiguities resulted in an
‘‘unacceptable amount of uncertainty’’
and directed NERC to remove the
ambiguous language and develop
modifications within one year.106 In
both Order No. 693 and Order No. 791,
the Commission approved NERC’s
proposed Reliability Standards as an
improvement to reliability, while
directing NERC to submit modifications
to the Standards addressing the
Commission’s concern regarding
vagueness of particular language. We
conclude that a similar approach is
appropriate in the immediate
proceeding, given the improvements
offered by Reliability Standard EOP–
104 See, e.g., ISO/RTO Comments at 10
(cautioning that the ‘‘broad undefined ‘commercial’
exemption could lead to the exception swallowing
the rule’’).
105 Order No. 693, 118 FERC ¶ 61,218 at PP 1,
461.
106 See Order No. 791, 145 FERC ¶ 61,160 at PP
49–53, 67, 69.
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012–1 in addressing Bulk-Power System
reliability during extreme cold weather
events.
66. Accordingly, we direct NERC,
pursuant to section 215(d) of the FPA,
to develop and submit modifications to
Reliability Standard EOP–012–1
Requirements R1 and R7 to address
concerns related to the ambiguity of
generator-defined declarations of
technical, commercial, or operational
constraints that preclude a generator
owner from implementing the
appropriate freeze protection measures
and to ensure that the constraint
declarations may not be used to opt-out
of compliance with the Standard or
obligations set forth in a corrective
action plan. Specifically, we direct
NERC to include auditable criteria on
permissible constraints and to identify
the appropriate entity that would
receive the generator owners’ constraint
declarations under EOP–012–1
Requirements R1 and R7. We direct
NERC to submit the revised Reliability
Standard no later than 12 months after
the date of issuance of this order.
67. TCPA requests that the
Commission clarify that a ‘‘lack of cost
recovery’’ is a commercial constraint to
implementing Requirement R1 and
R7.107 TCPA argues that the ability of
transmission service providers and
others to receive regulated rates of
return creates an uneven playing field
for independent generation.108 We
decline to grant TCPA’s proposed
clarification. Granting TCPA’s requested
clarification would be tantamount to a
blanket waiver for all generators that do
not currently recover their costs through
cost-of-service rates.109 We believe it
would be inappropriate to allow entities
participating in competitive wholesale
electric markets to simply opt-out of
reliability improvements offered by
NERC’s proposal because they lack a
dedicated cost recovery mechanism.
68. Additionally, to provide the
Commission with an ongoing
assessment of the risk to the Bulk-Power
System, we direct that NERC assess the
implementation of the declarations
through annual informational data
submittals filed with the Commission,
discussed in more detail in section 8.
107 TCPA Comments at 2–3, 7–8 (recommending
that commercial constraints be expanded to include
economic issues).
108 Id. at 2.
109 This order discusses cost recovery
mechanisms in more detail in section 5.
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4. The Calculation of the Extreme Cold
Weather Temperature at Which a
Generating Unit Must Be Capable of
Performing
a. NERC Petition
69. NERC proposes to define the term
Extreme Cold Weather Temperature as
equal to the lowest 0.2 percentile of the
hourly temperatures measured in
December, January, and February from
January 1, 2000, through the date the
temperature is calculated.110 According
to NERC, a statistical approach using
modern weather data would advance
the reliability of the Bulk-Power System
while also avoiding being overly
burdensome for those responsible for
compliance.111
b. Comments
70. Some commenters express
concern with the Extreme Cold Weather
Temperature definition.112 The ISO/
RTO Council argues that only
examining historical data from the year
2000 forward risks unnecessarily
limiting the range of possible cold
weather scenarios that the Standard is
intended to address, and proposes an
alternate calculation method.113
NEPGA/EPSA/PJM Group counters that
the ISO/RTO Council’s proposed
revisions materially change Reliability
Standard EOP–012–1, and should the
Commission adopt the ISO/RTO
proposal, then efforts to comply with
EOP–012–1 ‘‘as drafted’’ could be
potentially futile.114 Invenergy asserts
that the Extreme Cold Weather
Temperature definition is arbitrary
because NERC did not measure the
definition against any objective standard
to ensure reliable operation.115
Invenergy adds that the Extreme Cold
Weather Temperature should be
calculated by NERC and its Regional
Entities to prevent uneven
implementation and enforcement.116
Invenergy also argues that it is
unreasonable that the proposed Extreme
Cold Weather Temperature ‘‘will be
heavily influenced by the colder
nighttime temperatures, when there is
no solar generation.’’ 117
110 Id.
at 24.
at 25–27 (relying on the Modernization and
Associated Restructuring from the National Weather
Service, which has higher quality, more granular
temperature data in more locations).
112 NEPGA/EPSA/PJM Group Answer at 3–4; ISO/
RTO Comments at 6.
113 ISO/RTO Council Comments at 7–9.
114 NEPGA/EPSA/PJM Group Answer at 3–8
(requesting that the Commission not adopt the ISO/
RTO Council’s alternative Extreme Cold Weather
Temperature proposal).
115 Invenergy Comments at 7–8.
116 Id. at 8.
117 Id. at 7–8.
111 Id.
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c. Commission Determination
71. As noted above, the Extreme Cold
Weather Temperature is equal to the
lowest 0.2 percentile of the hourly
temperatures measured in December,
January, and February from January 1,
2000, through the date the temperature
is calculated.118 This method of
determining the Extreme Cold Weather
Temperature is a statistical approach,
using the cumulative distribution of
historical temperatures to determine the
0.2 percentile historical temperature.
NERC’s petition explains it relied on the
Modernization and Associated
Restructuring from the National
Weather Service, which has higher
quality and more granular temperature
data in more locations, being completed
in the year 2000 to justify the
elimination of all pre-2000 historical
weather data from consideration.119
72. We find that NERC’s Extreme Cold
Weather Temperature definition
represents a reasonable starting point for
reducing the level of risk. The use of the
Extreme Cold Weather Temperature to
establish a specific level of required
freeze protection for resources is also a
significant improvement over the
current cold weather Reliability
Standards, which contain no minimum
temperature operating requirements.120
With respect to the 0.2 threshold, we
believe that NERC reasonably balanced
a number of competing factors in setting
the Extreme Cold Weather
Temperature.121 Similarly, while we
agree with the ISO/RTO Council that
additional data sources may be
available, we find that NERC’s
consideration of data availability and its
determination to rely on meteorological
data starting in the year 2000 is
reasonable. Similarly, as the Extreme
Cold Weather Temperature definition is
meant to apply uniformly regardless of
generation type, we do not find it
unreasonable that solar generators
would need to meet an Extreme Cold
Weather Temperature based on 24-hourtemperature data.122
73. Although we agree that NERC
could have adopted other, potentially
more robust approaches to defining the
Extreme Cold Weather Temperature, we
believe that other factors such as
application, inspection, and
118 NERC
Petition at 24.
at 25–27.
120 See Order Approving Cold Weather Reliability
Standards, 176 FERC ¶ 61,119, at P 1.
121 NERC Petition at 130 (relying on this approach
to ensure that the Extreme Cold Weather
Temperature does not result in an overly
conservative design or preclude the generator
owner from using historical operating data to show
compliance).
122 See Invenergy Comments at 7–8.
119 Id.
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maintenance of the freeze protection
measures and the associated training of
generator owners or generator operators
that perform these actions (all of which
are requirements in the proposed
Standard) should reasonably improve
reliable operation of the Bulk-Power
System. Further, recognizing that
extreme cold weather temperatures
could drop below the Extreme Cold
Weather Temperature during future
events, the need for periodic Extreme
Cold Weather Temperature review 123
and updates 124 based on the new cold
weather temperatures will help mitigate
freezing issues over time, which could
lessen the risk of freeze-related outages
not being subject to corrective action
plans.
74. Accordingly, we are not
persuaded by commenters that
modification to NERC’s Extreme Cold
Weather Temperature definition is
warranted at this time. Nevertheless,
based on the concerns expressed above,
we direct that NERC assess the
implementation of the definition
through event-based informational data
submittals filed with the Commission,
discussed in more detail in section 8.
Based on the results of NERC’s
informational data submittals to the
Commission, the Commission will
determine whether future modification
to the Extreme Cold Weather
Temperature definition is warranted.
5. The Absence of a Deadline by Which
Generator Owners Must Implement the
New or Modified Freeze Protection
Measures Required by Their Corrective
Action Plans
a. NERC Petition
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75. Requirement R7 of EOP–012–1
mandates that a generator owner
implement each corrective action plan
developed pursuant to Requirements
R2, R4, or R6, or ‘‘explain in a
declaration why corrective actions are
not being implemented due to any
technical, commercial, or operational
constraint as defined by the Generator
Owner.’’ 125 Requirement R7 also
requires that the generator owner update
each corrective action plan if the actions
or timetables change, until the
corrective action plan implementation is
completed. But Reliability Standard
EOP–012–1 does not include a deadline
123 Reliability Standard EOP–012–1 already
mandates a five-year Extreme Cold Weather
Temperature re-calculation and updates to
corrective actions where warranted.
124 The proposed Standard requires updates
regardless of the Extreme Cold Weather
Temperature methodology used.
125 NERC Petition at 43.
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for the implementation completion of
such plans.
b. Comments
76. Some commenters express
concern with Requirement R7 and the
implementation timeline for generator
owner-developed corrective action
plans.126 Specifically, the ISO/RTO
Council requests modification because
Requirement R7 does not explain when
the implementation of the developed
corrective action plans should occur.127
The ISO/RTO Council also argues that it
is unclear to which entity or entities the
generator owner is supposed to provide
its corrective action plan.128 TCPA
asserts that it is unclear from EOP–012–
1 when the corrective actions outlined
in the developed corrective action plans
should be completed.129
c. Commission Determination
77. The NERC Glossary defines a
‘‘corrective action plan’’ as used in
EOP–012–1 as a ‘‘list of actions and an
associated timetable for implementation
to remedy a specific problem.’’ 130 As
such, the ‘‘corrective action plan[s]’’ in
EOP–012–1 are required to contain a
timetable for implementation
completion and entities are required to
implement actions consistent with the
timelines defined in the corrective
action plan under Requirement R7.
While entities are required to adhere to
the timelines as defined in their
corrective action plans, some Reliability
Standards establish a maximum time for
completion while others do not. For
example, the Commission directed
NERC to add specific timelines for the
completion of corrective action plans to
mitigate geomagnetic disturbances in
Reliability Standard TPL–007–1
(Transmission System Planned
Performance for Geomagnetic
Disturbance Events).131 In contrast, the
Commission has approved other
Reliability Standards requiring a
corrective action plan that do not
require a specific deadline for the
126 See,
e.g., ISO/RTO Council Comments at 10–
11; TCPA Comments at 4, 6.
127 ISO/RTO Council Comments at 11.
128 Id. at 10.
129 TCPA Comments at 6.
130 NERC Petition at 1013.
131 Reliability Standard for Transmission Sys.
Planned Performance for Geomagnetic Disturbance
Events, Order No. 830, 156 FERC ¶ 61,215, at PP
101–04 (2016), reh’g denied, Order No. 830–A, 158
FERC ¶ 61,041 (2017) (directing NERC to modify
TPL–007–1 to include a two-year deadline after the
development of a CAP to complete the
implementation of non-hardware mitigation and a
four-year deadline to complete hardware
mitigation).
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completion of the corrective action
plan.132
78. In this instance, despite the lack
of a deadline for completion, we find it
appropriate to approve the Standard
while also directing modification. We
are persuaded that modifying the
Standard to include a maximum time
for implementation completion is
reasonable for several reasons. First,
having a requirement to implement a
corrective action plan by a date certain
will provide a significant level of risk
reduction compared to the status quo.
Second, the requirement to implement a
corrective action plan and to identify
any temporary operating limitations or
effects to the cold weather preparedness
plan that would apply to entities until
the execution of the corrective actions
by a date certain is an improvement to
the Reliability Standards.133 Finally, we
do not find persuasive NERC’s
explanation that competition for expert
resources and supply chain challenges
may make setting a specific, uniform
corrective action plan timeline for all
generating units difficult. The
November 2021 Report recommends
that NERC’s standard drafting team
establish a maximum date that
corrective action plans must be
completed.134 Otherwise, without a
maximum time for implementation, we
are concerned that the time it takes to
complete the corrective action plans
could allow identified issues to remain
unresolved for a significant period.
79. Accordingly, we direct NERC
pursuant to FPA section 215(d)(5) to
modify Reliability Standard EOP–012–1
to address concerns related to the lack
of an implementation timeframe for
corrective action plans. Specifically, we
direct NERC to include in the Standard
a deadline or maximum period for the
implementation completion of
corrective action plans under the
Standard. We direct NERC to submit the
revised Reliability Standard no later
than 12 months after the date of
issuance of this order.
6. Cost Recovery Mechanisms
a. NERC Petition
80. Reliability Standard EOP–012–1
does not address cost recovery
mechanisms. However, NERC’s petition
132 See, e.g., PRC–004–6 (Protection System
Misoperation Identification and Correction),
Requirement R5 (requiring each transmission
owner, generator owner, and distribution owner
that owns a protection system component that
caused misoperation to develop a corrective action
plan or explain in declaration why corrective
actions are beyond the entity’s control).
133 Id. Ex. A–2 at 6–7.
134 November 2021 Report at 187 (Key
Recommendation 1d).
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recognizes that generator owners can
recover costs through markets or cost
recovery mechanisms approved by the
state public utility commissions.135
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b. Comments
81. Some commenters assert that
Reliability Standard EOP–012–1 should
address cost recovery.136 TCPA asserts
that the lack of a cost recovery for
competitive generators is a commercial
constraint to compliance with EOP–
012–1 and requests that the Commission
say so in its order.137 The ISO/RTO
Council asks the Commission to remove
the commercial constraint option from
EOP–012–1 altogether.138 Invenergy
argues that the November 2021 Report
recognized that generators should be
compensated for retrofits and that,
while the NERC Reliability Standards
process may not be the appropriate
forum to address cost recovery, it is now
incumbent on the Commission to
address cost recovery for generators
required to comply with EOP–012–1.139
NEPGA contends that a market change
or other cost recovery mechanism must
be in place by the effective date of
Reliability Standard EOP–012–1 and
asks the Commission to recognize the
FPA’s cost recovery allowances.140
EPSA/PJM Group ask that the
Commission begin a proceeding under
section 206 to address cost recovery for
compliance with Reliability
Standards.141
82. NERC and APPA/TAPS assert that
cost recovery is outside the scope of
what Reliability Standards can
address.142 Specifically, APPA/TAPS
contend that the Commission should
not act in this proceeding to provide
competitive generators with a
mechanism to recover cold weather
Standard compliance costs because the
FPA does not mandate special cost
recovery mechanisms for competitive
generators’ section 215 compliance
costs.143 APPA/TAPS state that
adopting a separate cost recovery
mechanism for competitive generators’
reliability compliance costs would be
inconsistent with the Commission’s
135 NERC Petition at 44 (citing to November 2021
Report at 191–92).
136 See, e.g., EPSA/PJM Group Comments at 10–
13.
137 TCPA Comments at 2.
138 ISO/RTO Council Comments at 10.
139 Invenergy Comments at 11–13.
140 NEPGA Comments at 2, 4–6.
141 EPSA/PJM Group Comments at 11, 13
(proffering that the Commission could issue a show
cause order pursuant to FPA section 206 to ensure
that each ISO and RTO have cost recovery
mechanisms in place).
142 NERC Reply Comments at 10; APPA/TAPS
Answer at 2–9.
143 APPA/TAPS Answer at 2–8.
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market-based framework and could risk
undercutting competitive markets.144
c. Commission Determination
83. We find that the question of
whether existing market mechanisms
provide an opportunity to recover the
prudently incurred costs of compliance
with the proposed Standard and the
request to initiate a proceeding under
FPA 206 are outside the scope of the
instant proceeding.
7. Other Technical Matters
a. Comments
84. Commenters raise other technical
concerns touching on a variety of
elements of the Standard. For example,
the ISO/RTO Council argues that
NERC’s implementation plan may
‘‘discourage earlier compliance’’ and
that the Commission should enact a
shorter implementation plan along with
an exception process for generator
owners that may ‘‘legitimately need
more time.’’ 145 The ISO/RTO Council
recommends revising the ‘‘Generator
Cold Weather Reliability Event’’
definition to account for generating
units rated at or below 200 MW.146 The
ISO/RTO Council also expresses
concern that corrective action plans
under the Standard only apply when the
unit is unable to operate at or above the
Extreme Cold Weather Temperature.147
Additionally, the ISO/RTO Council
questions how EOP–012–1 interacts
with tariff requirements.148
85. EPSA/PJM Group requests that
Requirements R1 and R2 be removed
from EOP–012–1 and be replaced with
a requirement that balancing authorities
instead ensure weather-resilient
generation.149 For Reliability Standard
EOP–012–1 Requirement R1, TAPS
requests that compliance with the
phrase ‘‘provide the capability to
operate’’ be based on sound engineering
judgment, meaning subsequent failures
during cold weather not automatically
lead to a violation since cold weather
events cannot be simulated ahead of
time.150
86. TCPA requests clarification of
when the five-year clock in Requirement
R4 begins and explanation how
Requirement R7 requirement for
corrective action plans could be
effective 18 months after government
approval when the standards for which
the corrective action plans would
address (i.e., Requirements R2 and R4)
are not effective until 60 and 78 months
after government approval.151 TCPA
suggests that generator owners only be
required to provide annual compliance
progress reports.152 TCPA also raises
issue with EOP–012–1’s violation
severity level’s lack of differentiation
between single and multiple
facilities.153 Invenergy suggests revising
NERC’s ‘‘Generator Cold Weather
Reliability Event’’ definition to align
better with the bulk electric system
definition to ensure that corrective
action plans are only required when an
actual Cold Weather Reliability Event
occurs.154 Invenergy and TCPA
recommend eliminating the term
‘‘continuous’’ from EOP–012–1
Requirement R1 to reflect variable
generation and that solar and wind
plants are unable to operate
continuously.155
87. NERC asserts that it is presently in
phase two of its standard development
process and that its standard drafting
team is presently considering many of
the issues raised in connection with this
proceeding.156 NERC encourages
commenters in this proceeding to
continue participating in NERC’s
standard development process so that
their issues and concerns can be
addressed.
b. Commission Determination
88. We share concerns with
commenters regarding the
implementation period of Reliability
Standard EOP–012–1, although we
acknowledge NERC’s assertion that the
time is necessary for generator owners
to calculate the Extreme Cold Weather
Temperature for each generating unit, to
identify Generator Cold Weather Critical
Components, and to perform the
necessary engineering studies and
analyses to identify and implement
freeze protection measures that would
provide for the required performance
capability or to explain why such
measures are precluded by technical,
commercial, or operational constraints.
To address these concerns, we direct
NERC to revise EOP–012 to require a
shorter implementation period and
staggered implementation for unit(s) in
a generator owner’s fleet.157 Such an
approach will reduce reliability risks
more quickly. Although we are giving
151 TCPA
Comments at 6.
152 Id.
144 Id.
153 Id.
145 ISO/RTO
at 8–9.
Council Comments at 15–16.
146 Id. at 16–17.
147 Id. at 11–12.
148 Id. at 13–15.
149 EPSA/PJM Comments at 2.
150 TAPS Comments at 5–6.
154 Invenergy
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at 7.
Comments at 2, 5–6.
at 2, 9–10; TCPA Comments at 5.
156 NERC Reply Comments at 13.
157 See, e.g., 146 FERC ¶ 61,213 at PP 1–2
(approving Reliability Standard MOD–025–2 and its
associated staggered implementation plan).
155 Id.
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NERC the discretion to determine what
the effective date should be shortened
to, we also emphasize that industry has
been aware of and alerted to the need to
prepare their generating units for cold
weather since at least 2011. NERC
should consider the amount of time that
industry has already had to implement
freeze protection measures when
determining the appropriate shorter
implementation period. We direct NERC
to submit the revised implementation to
Reliability Standard EOP–012–1 no later
than 12 months after the date of
issuance of this order.
89. For comments related to the
‘‘continuous’’ operation requirements of
EOP–012–1, the Reliability Standard is
clear that it requires generating units to
be ‘‘capable’’ of operating continuously
for 12 hours, and not that the units must
actually operate when they would
otherwise not be expected to operate.
NERC states in its petition that the 12hour requirement is a minimum.158
However, we find the phrase
‘‘continuous operation’’ to be confusing
and subject to conflicting
interpretations. We also note that it
creates confusion as to whether certain
generating units can ever be capable of
compliance. As Invenergy states, ‘‘solar
generators are not capable of operating
in a 12-hour period that extends beyond
daylight hours, and, typically when
there are freezing temperatures, the sun
does not even shine for 12 hours.’’ 159
And while Invenergy states that the
‘‘Standard Drafting Team indicated that
the freeze protection measures must
provide the level of protection that
would allow for 12 continuous hours if
the sun were to shine or the wind were
to blow for the period,’’ 160 the
Reliability Standard Requirements in
EOP–012–1 do not specify that.161 Thus,
we direct NERC to modify the Standard
to clarify Reliability Standard EOP–012–
1 Requirement R1 to ensure that
generators that are technically incapable
of operating for 12 continuous hours
(e.g., solar facilities during winter
months with less than 12 hours of
158 Reliability Standard EOP–012–1 does not
restrict longer duration commitments of generating
units, whether based on tariff commitments,
emergencies, or other conditions. See NERC
Petition Ex. C–2 at 5 (explaining that the intent of
Requirement R1 is to implement freeze protection
measures such that facilities are capable of
continuous operation for not less than 12 hours)
(emphasis added).
159 Invenergy Comments at 9.
160 Id.
161 Order No. 693, 118 FERC ¶ 61,218 at P 253
(‘‘The most critical element of a Reliability
Standard is the Requirements. As NERC explains,
‘the Requirements within a standard define what an
entity must do to be compliant . . . [and] binds an
entity to certain obligations of performance under
section 215 of the FPA.’ ’’).
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sunlight) are not excluded from
complying with the Standard. We direct
NERC to submit the revised Reliability
Standard no later than 12 months after
the date of issuance of this order.
90. We also find that the one-hour
continuous operations requirement in
Reliability Standard EOP–012–1
Requirement R2 is too short of a period
to adequately meet the purpose of the
Standard to ensure generating units
‘‘mitigate the reliability impacts of
extreme cold weather.’’ 162 Thus, we
direct NERC to modify the one-hour
continuous operations requirement of
Reliability Standard EOP–012–1
Requirement R2 to better align with the
stated purpose of the Reliability
Standard EOP–012–1. We direct NERC
to submit the revised Reliability
Standard no later than 12 months after
the date of issuance of this order.
91. We find that it is premature to
address TCPA’s recommendation that
generator owners only submit annual
progress reports on compliance.163
Nothing in proposed Reliability
Standard EOP–012–1 mandates the
submission of compliance reports and
we are already directing NERC to
address periodic data submittals in this
order.
92. Finally, for suggested revisions to
NERC’s ‘‘Generator Cold Weather
Reliability Event’’ definition to align
better with the bulk electric system
definition, and requests that
Requirements R1 and R2 be removed
from EOP–012–1 and be replaced with
a requirement that balancing authorities
instead ensure weather-resilient
generation,164 we decline to direct such
modifications at this time.
8. Annual and Event-Based Data
Submittals
93. NERC states that it plans to
address data submittal requirements in
phase two of its standard development
process.165 We find that such data
submittals are essential to assess the
performance of the Standards towards
assuring the reliability of the BulkPower System. Specifically, we find that
additional data and analysis is
necessary to address the uncertainty
created by the proposed technical,
commercial, or operational constraint
provisions, as discussed above in
section 3. This data and analysis are
essential to assess how the generating
units’ freeze protection measures
162 NERC Petition at 29 (noting that freeze
protection measures of the Standard would advance
the reliability of the Bulk-Power System by helping
to improve generator reliability in cold weather).
163 TCPA Comments at 5.
164 EPSA/PJM Comments at 2.
165 NERC Petition at 54–55.
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15007
(implemented to provide capability to
operate at the Extreme Cold Weather
Temperature) perform in future extreme
cold weather events, as discussed above
in section 4.
94. Accordingly, we direct that NERC,
pursuant to section 39.2(d) of the
Commission’s regulations, work with
Commission staff to develop and submit
a plan within 12 months of the issuance
of this order explaining how it will
gather data and submit an analysis that
will allow the Commission to
understand the efficacy of, and monitor
the ongoing risk posed by: (1) proposed
technical, commercial, or operational
constraint provisions in EOP–012–1,
Requirements R1, R6, and R7; and (2)
actual performance of freeze protection
measures during future extreme cold
weather events.
95. Regarding the proposed technical,
commercial, or operational constraint
provisions in EOP–012–1, Requirements
R1, R6, and R7, NERC should work with
Commission staff on the details of
timing and what to include in its plan,
which, at a minimum, should include
collection of the following data: (1) the
generating units that have declared
constraints under EOP–012–1 and the
megawatts of generation that they
represent, organized by fuel type; (2) the
megawatts of generation for which
declarations have been made for each
type of constraint (technical,
commercial, or operational), organized
by fuel type; (3) the rationale(s) for each
declaration; (4) the megawatts of
generation within the generation owner/
operator’s fleet currently capable of
operating at each unit’s Extreme Cold
Weather Temperature; (5) the projected
megawatts for which the generator
owner/operator expects to complete
corrective action plans for each year; (6)
the projected megawatts for which the
generator owner/operator expects to
implement corrective action plans for
each year; and (7) the megawatts of
generating units identified as ‘‘similar
equipment’’ 166 to which the generator
owner has determined that the cause(s)
for the Generator Cold Weather
Reliability Event are also applicable,
under R6.2, while also identifying any
similar equipment that will receive a
declaration. To provide the Commission
with an ongoing assessment of the risk
to the Bulk-Power System, NERC’s plan
should include an annual informational
filing to the Commission beginning 12
months after the mandatory and
enforceable date of the Standard. The
informational filing should include data
on the seven foregoing categories
aggregated at an appropriate level (e.g.,
166 For
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Regional Entity, balancing authority,
etc.), and an analysis of the efficacy of
the requirements of the Standard based
on the data. Depending on the results of
NERC’s data collection and analysis, the
Commission will determine whether
further modifications are needed to the
Standard.
96. NERC’s plan should also include
how it will analyze the performance of
generating units’ freeze protection
measures (implemented to provide
capability to operate at the Extreme
Cold Weather Temperature) in future
extreme cold weather events. Depending
on the results of NERC’s data collection
and analysis, the Commission will
determine whether further
modifications are needed to the
definitions or the Standard.
IV. Information Collection Statement
97. The information collection
requirements contained in this Final
Rule are subject to review by the Office
of Management and Budget (OMB)
under section 3507(d) of the Paperwork
Reduction Act of 1995.167 OMB’s
regulations require approval of certain
information collection requirements
imposed by agency rules.168 Upon
approval of a collection of information,
OMB will assign an OMB control
number and expiration date. Comments
on the collection of information are due
within 60 days of the date this order is
published in the Federal Register.
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
Commission solicits comments on the
Commission’s need for this information,
whether the information will have
practical utility, the accuracy of the
burden estimates, ways to enhance the
quality, utility, and clarity of the
information to be collected or retained,
and any suggested methods for
167 44
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168 5
U.S.C. 3507(d).
CFR 1320 (2021).
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minimizing respondents’ burden,
including the use of automated
information techniques.
98. The EOP Standards are currently
located in the FERC–725S (OMB Control
No. 1902–0270) collection. The
collection is currently approved by
OMB and contains Reliability Standards
EOP–010–1, EOP–011–1, EOP–004–4,
EOP 005–3, EOP–006–3, EOP–008–2
(Table 1). In Docket No. RD23–1–000,
the Commission proposes to replace the
current OMB approved Reliability
Standard EOP–011–1 169 with Reliability
Standard EOP–011–3 (Table 2) and add
a new information collection line item
for Reliability Standard EOP–012–1
(Table 3).
99. The number of respondents below
is based on an estimate of the NERC
compliance registry for balancing
authorities, transmission operators,
generator operators, generator owners,
and reliability coordinators. Reliability
Standards EOP–011–3 and EOP–012–1
apply to balancing authorities,
transmission operators, generator
operators, and reliability coordinators.
The Commission based its paperwork
burden estimates on the NERC
compliance registry as of November 4,
2022. According to the registry, there
are 98 balancing authorities, 168
transmission operators, 981 generator
operators, 1,107 generator owners, and
12 reliability coordinators. The
estimates in the tables below are based
on the change in burden from the
current EOP Reliability Standards to the
Reliability Standards approved in this
order. The Commission based the
burden estimates in the tables below on
169 The currently OMB approved FERC–725S
includes the burden related to Reliability Standard
EOP–011–1. Reliability Standard EOP–011–1 was
superseded by Reliability Standard EOP–011–2,
which was approved by the Commission in Docket
No. RD21–5–000 (issued August 24, 2021).
Reliability Standard EOP–011–3, as noted in Docket
No. RD23–1–000, will supersede Reliability
Standard EOP–011–2; thus, the burdens resulting
from Reliability Standard EOP–011–3 will be
reflected in the FERC–725S information collection.
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staff experience, knowledge, and
expertise.
100. The estimates in the tables below
are based, in combination, on one-time
(years 1 and 2) and ongoing execution
(year 3) obligations to follow the revised
EOP Reliability Standards.
101. The Reliability Standard EOP–
011–3 modifications transfer
Requirements R7 and R8 to Reliability
Standard EOP–012–1, as described
below. For Reliability Standard EOP–
011–3, transmission operators and to a
much lesser extent, balancing
authorities, still have a one-time cost to
modify existing operating plans based
on revisions to Reliability Standard
EOP–011–3 (Requirements R1 and R2)
and to mitigate operating emergencies
related to cold weather conditions.
Additionally, reliability coordinators
will need to review the modified
operating plans of the transmission
operators. In year three and ongoing, the
transmission operator and reliability
coordinator estimates are lower to
reflect lower paperwork burden for
upkeep and review of the operating
plans for emergencies based on the
modified Reliability Standard EOP–
011–3 to ensure that the new
requirements are in place and that
applicable entities are following those
plans.
102. The new Reliability Standard
EOP–012–1, which is applicable to
1,107 generator owners and 981
generator operators, contains several
new requirements and two requirements
from Reliability Standard EOP–011–2
that have been moved to Reliability
Standard EOP–012–1. In year three and
ongoing, the estimates are lower to
reflect that the implementation plan(s)
to mitigate the reliability effects of
extreme cold weather conditions on
generating units are in place and that
entities are familiar with the EOP–012–
1 requirements.
103. Burden Estimates: The
Commission estimates the changes in
the annual public reporting burden and
cost as indicated in the tables below:
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TABLE 1—CURRENT COSTS AND BURDEN RELATED TO FERC–725S (1902–0270)
Reliability standard and
associated requirement
Number of
respondents
Annual
number of
responses per
respondent
Total number
of responses
Average burden & cost
per response
Total annual burden &
total annual cost
Cost per
respondent
($)
(1)
(2)
(1) * (2) = (3)
(4)
(3) * (4) = (5)
(5) ÷ (1)
EOP–010–1 ..............................
EOP–011–1 ..............................
EOP–004–4, EOP–005–3,
EOP–006–3, EOP–008–2.
181
12
280
1
1
1
181
12
280
20 hrs.; $1,660 ...................
1,500 hrs.; $124,500 ..........
250.58 170 hrs.; $20,798 .....
3,620 hrs.; $300,460 ..........
18,000 hrs.; $1,494,000 .....
70,162.4 hrs.; $5,234,440 ..
$1,660
124,500
20,798
Total EOP ..........................
473
........................
..............................
.............................................
91,782 hrs.; $7,028,900 .....
........................
TABLE 2—PROPOSED CHANGES DUE TO FINAL RULE IN DOCKET NO. RD23–1–000
Reliability standard & requirement
Type171 and
number of
entity
Number
of annual
responses per
entity
Total number
of responses
Average
number of
burden hours
per response 172
Total burden hours
(1)
(2)
(1) * (2) = (3)
(4)
(3) * (4) = (5)
FERC–725S—Proposed estimates due to RD23–1 for EOP–011–3
One Time Estimate—Years 1 and 2 EOP–011–3
EOP–011–3 ..............................................................
EOP–011–3 173 .........................................................
EOP–011–3 174 .........................................................
168 (TOP) .........
98 (BA) ..............
12 (RC) ..............
1
1
1
168 .......................
98 .........................
12 .........................
60 hrs. $3,893.40
6 hrs. $389.34 ......
28 hrs. $1,816.92
10,080 hrs. $654,091.2.
588 hrs. $38,155.32.
336 hrs. $21,803.04.
Sub-total of EOP–011–3 (One time) .................
...........................
........................
278 .......................
...............................
11,004 hrs. $714,049.56.
Ongoing Estimate—Year 3 ongoing EOP–011–3
EOP–011–3 175
.........................................................
EOP–011–3 176 .........................................................
EOP–011–3 177 .........................................................
168 (TOP) .........
98 (BA) ..............
12 (RC) ..............
1
1
1
168 .......................
98 .........................
12 .........................
10 hrs. $648.90 ....
10 hrs. $648.90 ....
14 hrs. $908.46 ....
1,680 hrs. $109,015.20.
980 hrs. $63,592.20.
168 hrs. $10,901.52.
Sub-Total of EOP–011–3 (ongoing) .................
...........................
........................
278 .......................
...............................
2,828 $183,508.92.
Sub-Total of ongoing burden averaged over
three years.
...........................
........................
92.67 (rounded) ....
...............................
942.67 hrs. (rounded)
$61,169.64.
Proposed Total Burden Estimate of EOP–011–
3.
...........................
........................
370.67 ..................
...............................
11,946.67 hrs.
$775,219.42 (rounded).
TABLE 3—PROPOSED CHANGES DUE TO FINAL RULE IN DOCKET NO. RD23–1–000 FOR EOP–012–1
Reliability standard & requirement
Type and
number of
entity
Number
of annual
responses per
entity
Total number
of responses
Average
number of
burden hours per
response 178
Total burden hours
(1)
(2)
(1) * (2) = (3)
(4)
(3) * (4) = (5)
FERC—725S
One Time Estimate—Years 1 and 2 EOP–012–1
EOP–012–1 179 .................................................
EOP–012–1 ......................................................
1,107 (GO) ........
981 (GOP) .........
1
1
1,107
981
150 hrs. $9,733.50 .......
10 hrs. $648.90 ............
166,050 hrs. $10,774,984.50.
9,810 hrs. $636,570.90.
Sub-Total for EOP–012–1 (one-time) .......
...........................
........................
2,088
160 hrs. $10,382.40 .....
175,860 hrs. $11,411,555.40.
lotter on DSK11XQN23PROD with NOTICES1
Ongoing Estimate—Year 3 ongoing EOP–012–1
EOP–012–1 ......................................................
EOP–012–1 ......................................................
1,107 (GO) ........
981 (GOP) .........
1
1
1,107
981
40 hrs. $2,595.60 .........
10 hrs. $648.90 ............
40,680 hrs. $2,639,725.20.
9,810 hrs. $636,570.90.
Sub-Total for EOP–012–1 (ongoing) .........
...........................
........................
2,088
50 hrs. $3,244.50 .........
50,490 hrs. $3,276,296.10.
Sub-Total of ongoing burden averaged
over three years.
...........................
........................
696
.......................................
16,830 hrs. $1,092,098.70.
Proposed Total Burden Estimate of EOP–
012–1.
...........................
........................
2,784
.......................................
192,690 hrs. $12,503,654.10.
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TABLE 3—PROPOSED CHANGES DUE TO FINAL RULE IN DOCKET NO. RD23–1–000 FOR EOP–012–1—Continued
Reliability standard & requirement
Type and
number of
entity
Number
of annual
responses per
entity
Total number
of responses
Average
number of
burden hours per
response 178
Total burden hours
(1)
(2)
(1) * (2) = (3)
(4)
(3) * (4) = (5)
Changes to FERC 725S by RD23–1–000
FERC–725S modification
Current
inventory
(hours)
Current
inventory
(responses)
Removal of EOP–011–1 ...................................
Updates to EOP–011–3 ....................................
Addition of EOP–012–1 ....................................
18,000 ...............
...........................
...........................
12
........................
........................
lotter on DSK11XQN23PROD with NOTICES1
Titles: FERC–725S, Mandatory
Reliability Standards for the Bulk-Power
System; EOP Reliability Standards.
Action: Modifications to Existing
Collections of Information in FERC–
725S.
OMB Control Nos: 1902–0270 (FERC–
725S).
Respondents: Business or other for
profit, and not for profit institutions.
Frequency of Responses: On occasion
(and proposed for deletion).
Necessity of the Information:
Reliability Standards EOP–011–3
170 Burden hours per response may also include
any methods for improvement not limited to
trainings, drills, simulations, testing, etc.
171 TOP=Transmission Operator, BA=Balancing
Authority, GO=Generator Owner, GOP=Generator
Operator and RC=Reliability Coordinator.
172 The estimated hourly cost (salary plus
benefits) is a combination based on the Bureau of
Labor Statistics (BLS), as of 2022, for 75% of the
average of an Electrical Engineer (17–
2071)¥$77.02, mechanical engineers (17–
2141)¥$67.79. $77.02 + $67.79/2 = 72.405 × .75 =
54.303 ($54.30-rounded) ($54.30/hour) and 25% of
an Information and Record Clerk (43–4199) $42.35
× .25% = 10.5875 ($10.59 rounded) ($10.59/hour),
for a total ($54.30 + $10.59 = $64.89/hour).
173 Reduce the estimate for balancing authorities
from EOP–011–2 down from previous 60 hours to
6 hours for EOP–011–3.
174 Reduce the estimate for reliability
coordinators from EOP–011–2 down from previous
40 hours to 28 hours for EOP–011–3.
175 Reduce the estimate for transmission operators
from EOP–011–2 down from previous 50 hours to
10 hours for EOP–011–3.
176 Reduce the estimate for balancing authorities
from EOP–011–2 down from previous 50 hours to
10 hours for EOP–011–3.
177 Reduce the estimate for reliability
coordinators from EOP–011–2 down from previous
20 hours to 14 hours for EOP–011–3.
178 The estimated hourly cost (salary plus
benefits) is a combination based on the Bureau of
Labor Statistics (BLS), as of 2022, for 75% of the
average of an Electrical Engineer (17–
2071)¥$77.02, mechanical engineers (17–
2141)¥$67.79. $77.02 + $67.79/2 = 72.405 × .75 =
54.303 ($54.30-rounded) ($54.30/hour) and 25%
percent of an Information and Record Clerk (43–
4199) $42.35 × .25% = 10.5875 ($10.59 rounded)
($10.59/hour), for a total ($54.30 + $10.59 = $64.89/
hour).
179 The estimates for the generator owner and
generator operator are being moved from the current
EOP–011–2 to the new EOP–012–1.
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Total change due to RD23–1–000
¥18,000 hrs.; ¥12 responses.
+11,946.67 hrs.; +370.67 responses.
+192,690 hrs.; +2,784 responses.
(Emergency Operations), and EOP–012–
1 (Extreme Cold Weather Preparedness
and Operations) are part of the
implementation of the Congressional
mandate of the Energy Policy Act of
2005 to develop mandatory and
enforceable Reliability Standards to
better ensure the reliability of the
nation’s Bulk-Power system.
Specifically, the revised and new
Reliability Standards ensure that
generating resources are prepared for
local cold weather events and that
entities will effectively communicate
the information needed for operating the
Bulk-Power System.
Internal review: The Commission has
reviewed NERC’s proposal and
determined that its action is necessary
to implement section 215 of the FPA.
104. Interested persons may obtain
information on the reporting
requirements by contacting the Federal
Energy Regulatory Commission, Office
of the Executive Director, 888 First
Street NE, Washington, DC 20426
[Attention: Ellen Brown, email:
DataClearance@ferc.gov, phone: (202)
502–8663, fax: (202) 273–0873].
105. Comments concerning the
information collections and
requirements approved for retirement in
this Final Rule and the associated
burden estimates, should be sent to the
Commission in this docket and may also
be sent to the Office of Management and
Budget, Office of Information and
Regulatory Affairs [Attention: Desk
Officer for the Federal Energy
Regulatory Commission]. For security
reasons, comments should be sent by
email to OMB at the following email
address: oira_submission@omb.eop.gov.
V. Document Availability
106. 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 (https://
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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.
107. 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.
108. User assistance is available for
eLibrary and the Commission’s website
during normal business hours from the
Commission’s Online Support at (202)
502–6652 (toll free at 1–866–208–3676)
or email at ferconlinesupport@ferc.gov,
or the Public Reference Room at (202)
502–8371, TTY (202) 502–8659. Email
the Public Reference Room at
public.referenceroom@ferc.gov.
The Commission orders:
(A) Reliability Standards EOP–011–3
and EOP–012–1, the associated
violation risk factors and violation
severity levels, and the newly defined
terms Generator Cold Weather Critical
Component, Extreme Cold Weather
Temperature, and Generator Cold
Weather Reliability Event, are hereby
approved, as discussed in the body of
this order.
(B) NERC is hereby directed to
develop and submit, within 12 months
of the date of issuance of this order,
modifications to Reliability Standard
EOP–012–1 as discussed in the body of
this order.
(C) NERC is hereby directed to work
with Commission staff to submit a plan
no later than 12 months after the date
of issuance of this order on how it will
collect and assess data prior to and on
the implementation of the following
elements of Reliability Standard EOP–
012–1: (1) generator owner declared
constraints and explanations thereof;
and (2) the adequacy of the Extreme
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Federal Register / Vol. 88, No. 47 / Friday, March 10, 2023 / Notices
Cold Weather Temperature definition,
as discussed in the body of this order.
(D) NERC is hereby directed to assess
annual and event-based data submittals
to address the following elements of
Reliability Standard EOP–012–1: (1)
generator owner declared constraints
and explanations thereof; and (2) the
adequacy of the Extreme Cold Weather
Temperature definition, and to submit
periodic reports to the Commission
providing the results of the assessments,
as discussed in the body of this order.
By the Commission.
Issued: February 16, 2023.
Kimberly D. Bose,
Secretary.
[FR Doc. 2023–04875 Filed 3–8–23; 11:15 am]
BILLING CODE 6717–01–P
DEPARTMENT OF ENERGY
Federal Energy Regulatory
Commission
[Project No. 2513–091]
Green Mountain Power Corporation;
Notice of Application Tendered for
Filing With the Commission and
Establishing Procedural Schedule for
Licensing and Deadline for
Submission of Final Amendments
Take notice that the following
hydroelectric application has been filed
with the Commission and is available
for public inspection.
a. Type of Application: New Major
License.
b. Project No.: 2513–091.
c. Date Filed: February 28, 2023.
d. Applicant: Green Mountain Power
Corporation (GMP).
e. Name of Project: Essex No. 19
Hydroelectric Project.
f. Location: On the Winooski River in
Chittenden County, Vermont. The
project does not affect Federal lands.
g. Filed Pursuant to: Federal Power
Act, 16 U.S.C. 791(a)–825(r).
h. Applicant Contact: Mr. John
Tedesco, Green Mountain Power
Corporation, 163 Acorn Lane,
Colchester, Vermont 05446; phone:
(802) 655–8753 or email at
John.Tedesco@
greenmountainpower.com.
i. FERC Contact: Michael Tust at (202)
502–6522 or email at michael.tust@
ferc.gov.
j. This application is not ready for
environmental analysis at this time.
k. Project Description: The existing
project consists of: (1) a 494-foot-long
concrete gravity dam consisting of a 61foot-high non-overflow concrete
abutment section and three overflow
spillway sections 46-foot-high and each
topped by a 5-foot-high inflatable rubber
dam; (2) a 268-acre impoundment; (3) a
78-foot-wide, 36-foot-high concrete
intake structure with two concrete wing
walls, a steel trashrack with one-inch
bar spacing, and an embedded
downstream fishway; (4) two 3-footdiameter steel penstocks and four 9foot-diameter steel penstocks each
running parallel to each other and
extending underground from the dam to
the powerhouse with lengths ranging
from 382.9 to 389.3 feet; (5) a 154.6-footlong, 93.5-foot-wide, and 55.7-foot-high,
reinforced-concrete and brick
powerhouse located 400 feet
downstream of the intake housing four
horizontal Francis-type turbines with an
installed capacity of 2,223 kilowatts
(kW) each and four horizontal shaft
generators rated at 1,800 kilowatts each
as well as a double horizontal Francistype turbine (i.e., minimum flow unit)
with an installed capacity of 874 kW
connected to a generator rated at 850
kW; (6) a 300-foot-long, 34.5-kilovolt
overhead transmission line; and (7)
appurtenant facilities. Green Mountain
Power Corporation also owns and
maintains the following recreation
facilities: Overlook Park, an access site
to the impoundment, an access site to
the powerhouse tailrace area, and a
canoe portage.
The downstream fish passage facility
consists of two entrance gates each 3feet-wide and 7.5-feet long located at the
west end of the spillway. One entrance
is located near the north end of the
intake trashracks and the other is
located closer to the center of the intake
trashracks. The two entrances feed into
a collection chamber behind the
trashracks. The two collection chambers
are connected via a 54-inch-diameter,
67-foot-long steel pipe which transports
fish to an open channel sluice down the
adjacent spillway and into a plunge
pool. The plunge pool water level is
controlled by a concrete weir with a
bell-mouthed vertical slot with a 1-footwide opening which discharges flow
into the bypassed reach.
GMP currently operates the project in
a modified daily peaking mode while
raising and lowering the impoundment
level a maximum of 3 feet but now
proposes to operate the project in runof-river mode year-round while
maintaining the impoundment at an
elevation of 274.7 feet (under normal
flow conditions). GMP would continue
to provide minimum flows of 100 cubic
feet per second (cfs) or inflow, if less,
through the fish passage facility into the
bypassed reach from April 15 through
June 30 and from September 15 through
December 15 and 50 cfs or inflow, if
less, into the bypassed reach the
remainder the year. The project has an
average annual generation of 35,498
megawatt-hours.
l. Location of the Application: In
addition to publishing the full text of
this notice in the Federal Register, the
Commission provides all interested
persons an opportunity to view and/or
print the contents of this notice, as well
as other documents in the proceeding
(e.g., license application) via the
internet through the Commission’s
Home Page (https://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 (P–2513). For assistance,
contact FERC at FERCOnlineSupport@
ferc.gov or call toll-free, (866) 208–3676
or (202) 502–8659 (TTY).
m. You may also register online at
https://ferconline.ferc.gov/FERCOnline.
aspx to be notified via email of new
filings and issuances related to this or
other pending projects. For assistance,
contact FERC Online Support.
n. Procedural Schedule: The
application will be processed according
to the following preliminary Hydro
Licensing Schedule. Revisions to the
schedule may be made as appropriate.
lotter on DSK11XQN23PROD with NOTICES1
Milestone
Target date
Issue Deficiency Letter (if necessary) .................................................................................................................................
Issue Additional Information Request (if necessary) ..........................................................................................................
Notice of Acceptance/Notice of Ready for Environmental Analysis ...................................................................................
Filing of recommendations, preliminary terms and conditions, and fishway prescriptions ................................................
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March 2023.
April 2023.
August 2023.
October 2023.
]]>Agencies
[Federal Register Volume 88, Number 47 (Friday, March 10, 2023)]
[Notices]
[Pages 14994-15011]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-04875]
-----------------------------------------------------------------------
DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
[Docket No. RD23-1-000]
North American Electric Reliability Corporation; Order Approving
Extreme Cold Weather Reliability Standards EOP-011-3 and EOP-012-1 and
Directing Modification of Reliability Standard EOP-012-1
Before Commissioners: Willie L. Phillips, Acting Chairman; James P.
Danly, Allison Clements, and Mark C. Christie.
1. On October 28, 2022, the North American Electric Reliability
Corporation (NERC), the Commission-certified Electric Reliability
Organization (ERO), submitted a petition seeking approval of proposed
Reliability Standards EOP-011-3 (Emergency Operations) and EOP-012-1
(Extreme Cold Weather Preparedness
[[Page 14995]]
and Operations).\1\ As discussed in this order, we approve proposed
Reliability Standards EOP-011-3 and EOP-012-1, their associated
violation risk factors and violation severity levels, and the newly
defined terms Generator Cold Weather Critical Component, Extreme Cold
Weather Temperature, and Generator Cold Weather Reliability Event.
---------------------------------------------------------------------------
\1\ The proposed Reliability Standards are not attached to this
order. The proposed Reliability Standards are available on the
Commission's eLibrary document retrieval system in Docket No. RD23-
1-000 and on the NERC website, www.nerc.com.
---------------------------------------------------------------------------
2. It is essential to the reliable operation of the Bulk-Power
System to ``ensure enough generating units will be available during the
next cold weather event.'' \2\ As the November 2021 Report found, the
Bulk-Power System ``cannot operate reliably without adequate
generation.'' When cold weather events such as Winter Storm Uri occur,
with ``massive numbers of generating units'' failing, grid operators
could have no other option than to shed firm customer load to prevent
uncontrolled load shedding and cascading outages. And as unfortunately
illustrated by Winter Storm Uri, ``[t]hese firm load shedding events .
. . have very real human consequences. Millions went without heat . . .
Hundreds died from hypothermia.'' \3\ Accordingly, we approve proposed
Reliability Standards EOP-011-3 and EOP-012-1 as just, reasonable, not
unduly discriminatory or preferential, and in the public interest.
---------------------------------------------------------------------------
\2\ FERC, NERC, and Regional Entity Staff, The February 2021
Cold Weather Outages in Texas and the South Central United States,
at 189 (Nov. 16, 2021), https://www.ferc.gov/media/february-2021-cold-weather-outages-texas-and-south-central-united-states-ferc-nerc-and (November 2021 Report).
\3\ Id.
---------------------------------------------------------------------------
3. While NERC's proposed Reliability Standards may ``provide new
protections not currently found in any Reliability Standard,'' \4\ EOP-
012-1, in its current form, includes undefined terms, broad
limitations, exceptions and exemptions, and prolonged compliance
periods. Thus, we find that Reliability Standard EOP-012-1 requires
improvement to address concerns, as discussed further below. Therefore,
pursuant to section 215(d)(5) of the Federal Power Act (FPA),\5\ we
direct NERC to develop and submit modifications to Reliability Standard
EOP-012-1 as discussed herein.
---------------------------------------------------------------------------
\4\ NERC Petition at 7.
\5\ 16 U.S.C. 824o(d)(5).
---------------------------------------------------------------------------
4. As an initial matter, we are concerned that use of the terms
``continuous run,'' ``commits or is obligated to serve'' and ``four
hours or more,'' as well as the enumerated exemptions, obfuscates the
extent of applicability of Reliability Standard EOP-012-1 to bulk
electric system \6\ facilities, and may not ensure that compliance is
required for all ``generating units that are being depended upon to
operate in cold weather and on which the reliability of the system
depends.'' \7\ We understand that the proposed applicability criteria
is meant to avoid ``undue burden on those generating units that are not
expected to operate in cold weather;'' \8\ however, we find that
excluded generating units should be the exception and not the rule.\9\
Therefore, we direct NERC, pursuant to FPA section 215(d)(5), to modify
Reliability Standard EOP-012-1 to ensure that it captures all bulk
electric system generation resources needed for reliable operation and
excludes only those generation resources not relied upon during
freezing conditions.\10\ As discussed further below, our directive to
NERC is to clarify the language of the applicability section to align
with NERC's explanation of the entities that should already be
preparing to comply with the Standard, and should not need additional
implementation time. Therefore, NERC should ensure the modified
applicability section of Reliability Standard EOP-012 is implemented as
of the effective date \11\ of Reliability Standard EOP-012-1.
---------------------------------------------------------------------------
\6\ NERC's Commission-approved bulk electric system definition
defines the scope of the Reliability Standards and the entities
subject to NERC compliance. Revisions to Electric Reliability
Organization Definition of Bulk Electric System and Rules of
Procedure, Order No. 773, 141 FERC ] 61,236 (2012), order on reh'g,
Order No. 773-A, 143 FERC ] 61,053 (2013) rev'd sub nom. People of
the State of New York v. FERC, 783 F.3d 946 (2d Cir. 2015); NERC
Glossary at 5-7.
\7\ NERC Petition at 30.
\8\ Id.
\9\ As discussed below, we also find that, even as to the
limited set of excluded generating units, the obligation to have a
cold weather emergency preparedness plan(s) and training should
remain.
\10\ 16 U.S.C. 824o(d)(5) (stating that the Commission, ``upon
its own motion or upon complaint, may order the Electric Reliability
Organization 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 this section'').
\11\ This order uses the term ``effective date'' to mean the
mandatory and enforceable date of the Standards, which, according to
NERC's implementation plan, is 18 months after regulatory approval.
NERC Petition at 50-51.
---------------------------------------------------------------------------
5. Further, as Reliability Standard EOP-011-2 requirements to
implement and maintain cold weather preparedness plan(s) and associated
training applies to all bulk electric system generating units, we defer
our decision on whether to approve or modify NERC's proposed
implementation date for Reliability Standard EOP-011-3 (and proposed
retirement of Reliability Standard EOP-011-2) until NERC submits its
revised applicability section for EOP-012. Allowing EOP-011-2
requirements to remain mandatory and enforceable until such time as the
revised applicability is effective for EOP-012 will ensure all bulk
electric system generating units are required to maintain cold weather
preparedness plans.
6. In addition, we direct NERC to develop and submit modifications
to Reliability Standard EOP-012-1 Requirements R1 and R7 to address
concerns related to the ambiguity of generator-defined declarations of
technical, commercial, or operational constraints that exempt a
generator owner from implementing the appropriate freeze protection
measures. We direct NERC to include in the Standard: objective criteria
on permissible technical, commercial, and operational constraints, to
identify the appropriate entity that would receive the generator
owners' constraint declarations under EOP-012-1 Requirements R1 and R7,
to describe how that entity would confirm that the generator owners
comply with the objective criteria, and to describe the consequences of
providing a constraint declaration. We direct NERC to modify this
Standard to ensure that declarations cannot be used to opt out of
mandatory compliance with the Standard or obligations set forth in a
corrective action plan. We direct NERC to submit a revised Reliability
Standard that addresses these concerns no later than 12 months after
the date of issuance of this order.
7. Under Requirement R1 of EOP-012-1, generator owners must
``[i]mplement freeze protection measures that provide capability to
operate for a period of not less than twelve (12) continuous hours at
the Extreme Cold Weather Temperature'' or ``[e]xplain in a declaration
any technical, commercial, or operational constraints . . . that
preclude the ability to implement appropriate freeze protection
measures to provide capability of operating at twelve (12) hours at the
documented Extreme Cold Weather Temperature.'' \12\ Yet, based on
comments and our reading of the plain text of the Standard, we are
concerned that the requirement as written is unclear whether new
intermittent units
[[Page 14996]]
will be considered by all generator owners as being capable of
operating for at least 12 continuous hours, and thus, must comply with
the Requirement. Therefore, we direct NERC to modify the Standard to
clarify Reliability Standard EOP-012-1 Requirement R1 to ensure that
generators that are technically incapable of operating for 12
continuous hours (e.g., solar facilities during winter months with less
than 12 hours of sunlight) are not excluded from complying with the
Standard. We direct NERC to submit the revised Reliability Standard no
later than 12 months after the date of issuance of this order.
---------------------------------------------------------------------------
\12\ Reliability Standard EOP-012-1, Requirement R1.
---------------------------------------------------------------------------
8. Under Requirement R2 of EOP-012-1, each generator owner is
required to ``ensure its generating unit(s) add new or modify existing
freeze protection measures as needed to provide the capability to
operate for a period of not less than one (1) hour at the unit(s)
Extreme Cold Weather Temperature.'' \13\ We find that the one-hour
continuous operations requirement in Reliability Standard EOP-012-1
Requirement R2 is too short of a period to adequately meet the purpose
of the Standard to ensure generating units ``mitigate the reliability
impacts of extreme cold weather.'' \14\ Thus, we direct NERC to modify
the one-hour continuous operations requirement of Reliability Standard
EOP-012-1 Requirement R2. We direct NERC to submit the revised
Reliability Standard no later than 12 months after the date of issuance
of this order.
---------------------------------------------------------------------------
\13\ Reliability Standard EOP-012-1, Requirement R2.
\14\ NERC Petition at 29 (noting that freeze protection measures
of the Standard would advance the reliability of the Bulk-Power
System by helping to improve generator reliability in cold weather).
---------------------------------------------------------------------------
9. In addition, Reliability Standard EOP-012-1 does not require a
deadline for, or a maximum duration of, corrective action plan
implementation completion. We are concerned that the lack of a time
limit for implementation completion of corrective action plans could
allow identified issues to remain unresolved for a significant and
indefinite period. Therefore, we direct NERC pursuant to FPA section
215(d)(5), to modify Reliability Standard EOP-012-1 Requirements R7 to
include deadlines for implementation completion of corrective action
plans, as recommended in the November 2021 Report.\15\ We direct NERC
to submit the revised Reliability Standard no later than 12 months
after the date of issuance of this order.
---------------------------------------------------------------------------
\15\ See, e.g., November 2021 Report at 187 (discussing Key
Recommendation 1d, which, while recommending that the standards
drafting team have flexibility to determine the specific timing for
the corrective action plan to be developed and implemented after the
outage, derate or failure to start, also recommends that the
corrective action plan ``be developed as quickly as possible, and be
completed by no later than the beginning of the next winter
season.'').
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10. Additionally, we are concerned that generator owners will not
have to implement freeze protection measures for existing generating
units to provide them with the capability to operate for the specified
durations at the Extreme Cold Weather Temperature under proposed EOP-
012-1 Requirement R2 until 60 months from regulatory approval. Thus, we
direct NERC to modify the EOP-012-1 60-month implementation plan for
existing generating units. Although we are giving NERC the discretion
to determine what the effective date should be shortened to, we also
emphasize that industry has been aware of and alerted to the need to
prepare their generating units for cold weather since at least
2011.\16\ This finding was repeated in the 2019 South Central Event
Report \17\ and the November 2021 Report.\18\ After the 2019 South
Central Event Report, it was found that one third of the generator
owners and operators surveyed ``still had no winterization provisions
after multiple recommendations on winter preparedness for generating
units.'' \19\ NERC should consider the amount of time that industry has
already had to implement freeze protection measures when determining
the appropriate implementation period. Further, we find that a phased
compliance within the implementation time for Reliability Standard EOP-
012-1 Requirement R2 will also reduce reliability risks. To address
these concerns, we direct NERC to modify the EOP-012-1 implementation
plan for Requirement R2 to require a staggered implementation for
existing unit(s) in a generator owner's fleet with an effective date of
less than 60 months from regulatory approval.\20\
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\16\ See, e.g., FERC and NERC Staff, Report on Outages and
Curtailments During the Southwest Cold Weather Event of February 1-
5, 2011: Causes and Recommendations, at 208 (Aug. 2011), https://www.ferc.gov/sites/default/files/2020-07/OutagesandCurtailmentsDuringtheSouthwestColdWeatherEventofFebruary1-5-2011.pdf (recommending that each generator owner and operator
should take steps to ensure that winterization is in place before
the inter season and take preventative action in a timely manner).
\17\ FERC and NERC Staff, The South Central United States Cold
Weather Bulk Electric System Event of January 17, 2018, at 80-81
(July 2019), https://www.ferc.gov/sites/default/files/legal/staff-reports/2019/07-18-19-ferc-nerc-report.pdf (finding that the event
was ``caused by failure to properly prepare or `winterize' the
generation facilities for cold temperatures'').
\18\ November 2021 Report at 185 (finding that ``generation
freezing issues were the number one cause of the Event, and the same
frequently-seen frozen components reappear'').
\19\ Id.
\20\ See e.g., Generator Verification Reliability Standards,
Order No. 796, 146 FERC ] 61,213, at PP 1-2 (2014) (approving
Reliability Standard MOD-025-2 and its associated staggered
implementation plan, which required 40% of applicable facilities to
be verified in 2 years, 60% in 3 years, 80% in 4 years, and 100% in
5 years).
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11. We also find it necessary that NERC ensure that Reliability
Standard EOP-012-1 adequately addresses the reliability concerns
related to generator owner constraint declarations, the adequacy of the
Extreme Cold Weather Temperature definition, and determine whether
future modification is needed, as discussed in more detail below. We
note that, under the proposed implementation plan, it will be five
years before certain requirements will be effective and a longer period
before experiential data will be available. Notwithstanding our
directives to shorten the implementation period for certain
Requirements, waiting to collect data until after implementation will
not provide timely information on the effectiveness of winterization
efforts. However, section 1600 of NERC's Rules of Procedure provides a
mechanism for data collections that could be used during the period
prior to full implementation. Therefore, we direct NERC, pursuant to
section 39.2(d) of the Commission's regulations,\21\ to work with
Commission staff to submit a plan no later than 12 months after the
date of issuance of this order explaining how it will collect and
assess data prior to and after the implementation of the following
elements of Reliability Standard EOP-012-1: (1) generator owner
declared constraints and explanations thereof; and (2) the adequacy of
the Extreme Cold Weather Temperature definition.
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\21\ 18 CFR 39.2(d) (2021) (the ERO shall provide the Commission
such information as is necessary to implement section 215 of the
FPA).
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I. Background
A. Section 215 and Mandatory Reliability Standards
12. Section 215 of the FPA provides that the Commission may certify
an ERO, the purpose of which is to develop mandatory and enforceable
Reliability Standards, subject to Commission review and approval.\22\
Reliability Standards may be enforced by the ERO, subject to Commission
oversight, or by the Commission independently.\23\ Pursuant to section
215 of the FPA, the Commission established a process to
[[Page 14997]]
select and certify an ERO,\24\ and subsequently certified NERC.\25\
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\22\ 16 U.S.C. 824o(c).
\23\ Id. Sec. 824o(e).
\24\ Rules Concerning Certification of the Elec. Reliability
Org.; & Procs. for the Establishment, Approval, & Enforcement of
Elec. Reliability Standards, Order No. 672, 114 FERC ] 61,104, order
on reh'g, Order No. 672-A, 114 FERC ] 61,328 (2006).
\25\ N. Am. Elec. Reliability Corp., 116 FERC ] 61,062, order on
reh'g and compliance, 117 FERC ] 61,126 (2006), aff'd sub nom.
Alcoa, Inc. v. FERC, 564 F.3d 1342 (D.C. Cir. 2009).
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B. The February 2021 Cold Weather Reliability Event
13. On February 16, 2021, the Commission, NERC, and Regional Entity
staff initiated a joint inquiry into the circumstances surrounding a
February 2021 cold weather reliability event that affected Texas and
the South-Central United States that culminated in a report
identifying, among other things, recommendations for Reliability
Standard improvements.\26\ The November 2021 Report found that the
February 2021 cold weather reliability event was the largest controlled
firm load shed event in U.S. history; over 4.5 million people lost
power and at least 210 people lost their lives during the event.\27\
The November 2021 Report provided an assessment of the event as well as
recommendations including, inter alia, Reliability Standard
enhancements to improve extreme cold weather operations, preparedness,
and coordination.\28\
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\26\ See November 2021 Report at 9.
\27\ Id.
\28\ Id. at 184-212 (sub-recommendations 1a through 1j).
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14. After the February 2021 cold weather reliability event, but
before the November 2021 Report was issued, NERC filed a petition for
approval of cold weather Reliability Standards addressing
recommendations from a 2018 cold weather event report.\29\ In August
2021, the Commission approved NERC's modifications to Reliability
Standards EOP-011-2 (Emergency Preparedness and Operations), IRO-010-4
(Reliability Coordinator Data Specification and Collection), and TOP-
003-5 (Operational Reliability Data).\30\ Reliability Standards IRO-
010-4 and TOP-003-5 require that reliability coordinators, transmission
operators, and balancing authorities develop, maintain, and share
generator cold weather data.\31\ EOP-011-2 requires generator owners to
have generating unit cold weather preparedness plans and generator
owners and generator operators to provide training for implementing the
cold weather preparedness plans.\32\
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\29\ 2019 South Central Event Report at 89.
\30\ See generally Order Approving Cold Weather Reliability
Standards, 176 FERC ] 61,119 (2021) (noting that the standards
become enforceable on April 1, 2023).
\31\ Id.
\32\ Id.
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C. NERC's Petition and Proposed Reliability Standards EOP-011-3 and
EOP-012-1
15. On October 28, 2022, NERC filed a petition seeking approval on
an expedited basis of Reliability Standards EOP-011-3 and EOP-012-1,
the Standards' associated violation risk factors and violation severity
levels, three newly-defined terms (Extreme Cold Weather Temperature,
Generator Cold Weather Critical Component, and Generator Cold Weather
Reliability Event), NERC's proposed implementation plan, and the
retirement of currently approved EOP-011-2.\33\ NERC explains that
Reliability Standards EOP-011-3 and EOP-012-1 build upon the 2021-
approved cold weather Reliability Standards by further strengthening
the reliability of the Bulk-Power System during extreme cold weather
conditions.\34\ NERC maintains that proposed Reliability Standards EOP-
011-3 and EOP-012-1 are consistent with key recommendations for
standards' improvement from the November 2021 Report.\35\ Specifically,
NERC states that the proposed Reliability Standards contain new and
revised requirements to advance the reliability of the Bulk-Power
System through the implementation of freeze protection measures,
enhanced weather preparedness plans, annual training, and the
coordination of manual and automatic load shed.\36\
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\33\ NERC Petition at 1-2.
\34\ Id.
\35\ Id. at 23; see also November 2021 Report at 184-92, 208-10
(Key Recommendations 1b, 1d, 1e, 1f, and 1j).
\36\ NERC Petition at 23.
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16. NERC states that the purpose of proposed Reliability Standard
EOP-011-3 is to ensure that each transmission operator implements plans
to mitigate operating emergencies and that such plans are coordinated
within the reliability coordinator area. According to NERC, proposed
Reliability Standard EOP-011-3 addresses Key Recommendation 1j from the
November 2021 Report, which recommends that the circuits used for
manual load shed be separated from the circuits used for automatic load
shed or for critical loads.\37\
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\37\ See id. at 20 (citing the November 2021 Report at 208-10
(recommending that transmission operators use automatic load shed as
a last resort)).
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17. NERC proposes to modify approved Reliability Standard EOP-011-2
in multiple ways.\38\ First, NERC proposes to remove Requirements R7
and R8 (generator cold weather preparedness plans and associated
training) from EOP-011-2 and incorporate them into proposed Reliability
Standard EOP-012-1 as Requirements R3 and R5, respectively.\39\ Second,
the added Requirements R1 and R2 of EOP-011-3 require that transmission
operator emergency operating plans include provisions that minimize the
overlap of manual load shed circuits, circuits that serve critical
loads, and circuits that are used for underfrequency load shedding
(UFLS) or undervoltage load shedding (UVLS).\40\ Third, Requirement R1
requires the development of provisions that limit manual load shed of
UFLS or UVLS circuits to situations warranted by system conditions.\41\
Finally, Requirement R2 adds provisions for transmission operators to
implement the operator-controlled manual load shed in accordance with
Requirement R1. NERC also requests that the currently approved
Reliability Standard EOP-011-2, which will go into effect on April 1,
2023, be retired immediately prior to the effective date of Reliability
Standard EOP-011-3 and EOP-012-1, i.e., 18 months after regulatory
approval.\42\
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\38\ Reliability Standard EOP-011-3, Requirements R3, R4, and R5
are unchanged from the approved version. See Order Approving Cold
Weather Reliability Standards, 176 FERC ] 61,119 (approving EOP-011-
2).
\39\ Id.; NERC Petition at 45-46.
\40\ NERC Petition at 46-49.
\41\ Id. Ex. A-1, at 2-3.
\42\ NERC Petition at 50.
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18. NERC requests approval of a new Reliability Standard, EOP-012-
1, which it states is meant to apply to generator owners and operators
of generating units that are depended upon to operate during cold
weather and Blackstart Resources. The purpose of Reliability Standard
EOP-012-1 is to ensure that each generator owner develops and
implements plans to alleviate the reliability effects of extreme cold
weather on its generating units.\43\ According to NERC, this new
Reliability Standard addresses parts of Key Recommendation 1a as well
as 1d, 1e, and 1f of the November 2021 Report.\44\
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\43\ Id. at 29.
\44\ See id. at 17-18 (citing the November 2021 Report at 184-
89).
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19. Proposed Reliability Standard EOP-012-1 has seven requirements,
five of which are new (Requirements R1, R2, R4, R6, and R7) and two of
which (Requirements R3 and R5) were moved and revised from approved
Reliability Standard EOP-011-2. Reliability
[[Page 14998]]
Standard EOP-012-1 Requirements R1 and R2 address a generator owner's
obligation to implement freeze protection measures on its applicable
units to provide them with the capability to operate at the Extreme
Cold Weather Temperature for the unit's location.\45\ Specifically,
Requirement R1 requires either new units to be capable of operating at
the Extreme Cold Weather Temperature for a continuous 12-hour period or
that the generator owner declares that technical, commercial, or
operational constraints prevent successful continuous operation.
Requirement R2 requires either that existing units be capable of
continuous operation for at least one hour at the Extreme Cold Weather
Temperature or the generator owner to develop a corrective action plan
to address the unit's inability to continuously operate
successfully.\46\
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\45\ Id. at 33-37.
\46\ NERC defines the term ``corrective action plan'' as a
``list of actions and an associated timetable for implementation to
remedy a specific problem.'' NERC, Glossary of Terms Used in NERC
Reliability Standards, 11 (Dec. 2022) (NERC Glossary), https://www.nerc.com/pa/Stand/GlossaryofTerms/Glossary_of_Terms.pdf. See
also Reliability Standard EOP-012-1, section 4.3.
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20. Reliability Standard EOP-012-1 Requirements R3 and R5 require
generator owners to implement cold weather preparedness plans
(Requirement R3) and train their personnel on that plan annually
(Requirement R5).\47\ Requirement R3 also identifies the generator
owner as the entity responsible for identifying the Extreme Cold
Weather Temperature and Generator Cold Weather Critical Components for
its unit(s); the generator owner must document both in its cold weather
preparedness plan(s).
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\47\ NERC Petition at 37-41 (stating that Requirements R3 and R5
were taken from Requirements R7 and R8 from Commission approved EOP-
011-2 with modifications to ensure that a generator owner's cold
weather preparedness plan includes the Extreme Cold Weather
Temperature, Generator Cold Weather Critical Components, and freeze
protection measures).
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21. Reliability Standard EOP-012-1 Requirement R4 requires the
generator owner to review its Extreme Cold Weather Temperature
calculation, cold weather preparedness plan(s), and freeze protection
measures every five years to determine if changes or updates are
warranted.\48\ Requirement R6 mandates that each generator owner
experiencing an outage, failure to start, or derate due to freezing
conditions develop a corrective action plan to address the identified
causes. Lastly, Requirement R7 requires generator owners to implement
corrective action plans developed pursuant to Requirements R2, R4, or
R6, or explain in a declaration why they are not implementing
corrective actions due to technical, commercial, or operational
constraints.\49\
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\48\ Id. at 39-40 (this periodic review may require the
generator owner to add or modify existing freeze protection measures
to continue reliable operation).
\49\ Id. at 43-45 (noting that the generator owner defines these
constraints).
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22. NERC requests the Commission approve the violation risk factors
and violation severity levels for Reliability Standards EOP-011-3 and
EOP-012-1. NERC states that the violation risk factors and violation
severity levels for Reliability Standard EOP-011-3 did not change from
approved Reliability Standard EOP-011-2. NERC also proposes violation
risk factors and violation severity levels for new Reliability Standard
EOP-012-1.\50\
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\50\ Id. Ex. E at 7-20 (explaining NERC's justifications for
each violation risk factor and violation severity level associated
with Reliability Standard EOP-012-1).
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23. NERC proposes an 18-month effective date for Reliability
Standards EOP-011-3 and EOP-012-1, beginning on the first day of the
first calendar quarter following regulatory approval.\51\ All the
requirements of Reliability Standard EOP-011-3 would be effective on
this date.
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\51\ NERC Petition at 50-51.
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24. Specific to the requirements of EOP-012-1, as of the effective
date, generator owners will be required to update their cold weather
preparedness plans to include the Extreme Cold Weather Temperature and
Generator Cold Weather Critical Components, and document freeze
protection measures for those components as required by EOP-012-1
Requirement R3 as well as provide unit-specific cold weather plan
training on an annual basis as required by Requirement R5. Within 150
days of the effective date, generator owners will be required to
develop corrective action plans, or declare constraints, as required by
proposed EOP-012-1 Requirements R6 and R7. NERC also proposes that
generator owners have an additional 42 months from the effective date
of proposed Reliability Standard EOP-012-1 (i.e., 60 months from the
regulatory approval date) to come into compliance with the new freeze
protection measures of EOP-012-1 Requirements R1 and R2 and an
additional 60 months from the effective date (i.e., 78 months from the
regulatory approval date) to perform the first re-evaluation of the
Extreme Cold Weather Temperature for their units and update cold
weather preparedness plans and unit freeze protection measures,
including developing any corrective action plans, as needed for
proposed EOP-012-1 Requirement R4.
25. NERC explains that it considered these implementation
timeframes necessary for generator owners to calculate the Extreme Cold
Weather Temperature for each generating unit, to identify Generator
Cold Weather Critical Components, and to perform the necessary
engineering studies and analyses to identify and implement freeze
protection measures that would provide for the required performance
capability or to explain why such measures are precluded by technical,
commercial, or operational constraints. NERC also states that generator
owners need additional time to implement the freeze protection measures
of EOP-012-1 Requirements R1 and R2 because of the significant
engineering, design, analysis, and implementation efforts required to
complete such work.\52\
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\52\ Id. at 52.
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26. NERC explains that it adopted a two-phase standard development
project to develop, draft, and revise the extreme cold weather
Reliability Standards in accordance with the November 2021 Report due
to the extensive scope and demonstrated urgency of new and improved
cold weather Reliability Standards.\53\ NERC states that its October
28, 2022, petition represents phase one of its standard development
project and that the remaining November 2021 Report recommendations
will be addressed in the second phase of standards development. In
phase two, NERC states that its standard drafting team also plans to
consider industry concerns that arose in phase one.
---------------------------------------------------------------------------
\53\ Id. at 53 (noting that NERC anticipates completing
development and filing with the Commission new or revised
Reliability Standards by November 1, 2023).
---------------------------------------------------------------------------
27. Finally, NERC requests the Commission approve the proposed
Standards in an expedited manner. NERC explains that, among other
things, an expedited approval would provide regulatory certainty to
entities seeking to implement the Standards ahead of the mandatory and
enforceable dates.\54\
---------------------------------------------------------------------------
\54\ Id. at 55.
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II. Notice of Filing and Responsive Pleadings
28. Notice of NERC's October 28, 2022, Petition was published in
the Federal Register, 87 FR 67464 (Nov. 8, 2022), with comments,
protests, and motions to intervene due on or before December 1, 2022.
29. On November 17, 2022, the Electric Power Supply Association
(EPSA) filed a motion for an extension of time to submit comments. On
[[Page 14999]]
November 29, 2022, the Commission extended the comment period seven
days to and including December 8, 2022.
30. The Commission received six sets of comments and five reply
comments. The LS Power Development, LLC; Calpine Corporation; EPSA; PJM
Power Providers Group (PJM Group); Transmission Access Policy Study
Group (TAPS); the National Rural Electric Cooperative Association
(NRECA); American Public Power Association (APPA); the Independent
System Operators and Regional Transmission Organization Council (ISO/
RTO Council); Edison Electric Institute (EEI); New England Power
Generators Association, Inc. (NEPGA); and Invenergy LLC (Invenergy)
filed timely motions to intervene. TAPS, the ISO/RTO Council, NEPGA,
Invenergy, EPSA/PJM Group jointly, and the Texas Competitive Power
Advocates (TCPA) filed timely comments. NERC filed reply comments out
of time. Invenergy filed a motion for leave to reply and reply comments
out of time. NEPGA/EPSA/PJM Group filed a joint out of time motion for
leave to answer and joint answer to the ISO/RTO Council's comments.
APPA/TAPS filed a joint out of time motion for leave to answer along
with a joint answer to EPSA's comments. The ISO/RTO Council also filed
an out of time motion for leave to answer along with an answer to the
NERC's reply comments and NEPGA/EPSA/PJM Group's answer.
31. Commenters either did not address or were generally supportive
of NERC's proposed modifications to Reliability Standard EOP-011-3.\55\
Commenters raised concerns and requests for clarifications for NERC's
proposed Reliability Standard EOP-012-1. The commenters range in their
support for Reliability Standard EOP-012-1 from requesting that the
Commission approve the Standard as filed with minor clarifications \56\
to remanding the Standard to NERC with directives.\57\ The comments on
specific matters are summarized and addressed in the determinations
below.
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\55\ E.g., EPSA/PJM Group Comments at 3; NEPGA/EPSA/PJM Group
Answer at 1; ISO/RTO Council Comments at 1-2, TAPS Comments at 1.
\56\ See APPA/TAPS Answer at 2-9; ISO/RTO Comments at 1-3; ISO/
RTO Answer at 1-2; TAPS Comments at 1.
\57\ See EPSA/PJM Group Comments at 2-4; Invenergy Comments at
2, 13; NEPGA Comments at 2, 6-8; TCPA Comments at 2, 5-6.
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III. Determination
A. Procedural Matters
32. Pursuant to Rule 214 of the Commission's Rules of Practice and
Procedure, 18 CFR 385.214 (2021), the timely, unopposed motions to
intervene serve to make the entities that filed them parties to this
proceeding.
33. Rule 213(a)(2) of the Commission's Rules of Practice and
Procedure, 18 CFR 385.213(a)(2) (2021), prohibits an answer to a
protest or answer unless otherwise ordered by the decisional authority.
Pursuant to Rule 214(d) of the Commission's Rules of Practice and
Procedure, 18 CFR 385.214(d), we grant NERC and Invenergy's leave to
file their late-filed reply comments given their interest in the
proceeding and the absence of undue prejudice or delay. We also grant
APPA/TAPS, NEPGA/EPSA/PJM Group, and the ISO/RTO Council's motions for
leave to file out of time answers and we accept their answers because
they have provided information that assisted us in our decision-making
process.
B. Substantive Matters
34. Pursuant to section 215(d)(2) of the FPA, we approve
Reliability Standards EOP-011-3 and EOP-012-1 as just, reasonable, not
unduly discriminatory or preferential and in the public interest. As
discussed in this order, we approve proposed Reliability Standards EOP-
011-3 and EOP-012-1, their associated violation risk factors and
violation severity levels, the newly defined terms Generator Cold
Weather Critical Component, Extreme Cold Weather Temperature, and
Generator Cold Weather Reliability Event. We defer our decision on
whether to approve or modify NERC's proposed implementation date for
Reliability Standard EOP-011-3 (and proposed retirement of Reliability
Standard EOP-011-2) until NERC submits its revised applicability
section for EOP-012, as discussed in more detail below. Absent the
reforms adopted in Reliability Standards EOP-011-3 and EOP-012-1, the
existing defects and inefficiencies exhibited during extreme cold
weather conditions could be exacerbated and negatively affect
reliability.
35. We find that Reliability Standard EOP-011-3 is an improvement
over the 2021-approved cold weather Reliability Standards and enhances
reliability by improving how transmission operators account for the
overlap of manual load shed and automatic load shed in their emergency
operating plans while also addressing the need to minimize the use of
manual load shed that could further exacerbate emergencies and threaten
system reliability. Commenters did not express concern with Reliability
Standard EOP-011-3. Accordingly, we approve Reliability Standard EOP-
011-3.
36. We find that Reliability Standard EOP-012-1 represents an
improvement to the Reliability Standards and enhances the reliable
operation of the Bulk-Power System by requiring generator owners to
implement freeze protection measures, develop enhanced cold weather
preparedness plans, implement annual trainings, draft and implement
corrective action plans to address freezing issues, and provide certain
cold weather operating parameters to reliability coordinators,
transmission operators, and balancing authorities for use in their
analyses and planning. We believe that these measures begin to address
many of the issues identified as contributing to generating unit
failures during extreme cold weather conditions, as noted in the
November 2021 Report.\58\ We also appreciate that NERC completed the
modifications and development of Reliability Standards EOP-011-3 and
EOP-012-1 in a timely manner.
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\58\ See November 2021 Report at 184-210.
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37. Several commenters express concern regarding ambiguities in
Requirements R1 and R7 of Reliability Standard EOP-012-1 pertaining to
the generator owner declarations for ``technical, commercial, or
operational constraints'' and ask the Commission to remand the Standard
with direction to NERC for clarifications.\59\ As discussed below, we
agree that the provisions are ambiguous. However, we are not persuaded
that there is sufficient cause to remand Reliability Standard EOP-012-
1. Since we find that the Standard enhances the reliable operation of
the Bulk-Power System, we conclude that the better course is to approve
Reliability Standard EOP-012-1 so that it will take effect in a timely
manner. Nevertheless, pursuant to our authority under FPA section
215(d)(5), we also direct NERC to develop modifications to address the
concerns regarding Requirements R1 and R7, as well as other concerns we
have identified as to other aspects of Reliability Standard EOP-012-1,
without delaying the effective date of Reliability Standard EOP-012-1.
This approach is consistent with Commission precedent.\60\
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\59\ See e.g., EPSA/PJM Group Comments at 7-9; ISO/RTO Council
Comments at 10; NEPGA Comments at 7-8.
\60\ See e.g., Mandatory Reliability Standards for the Bulk-
Power Sys., Order No. 693, 118 FERC ] 61,218, at P 10 (2007) (noting
that ``[w]here a Reliability Standard requires significant
improvement, but is otherwise enforceable, the Commission approves
the Reliability Standard'' and ``directs the ERO to modify'' such
Standards to address identified issues or concerns); Version 5
Critical Infrastructure Prot. Reliability Standards, Order No. 791,
145 FERC] 61,160, at PP 1-4 (2013), order on clarification and
reh'g, Order No. 791-A, 146 FERC ] 61,188 (2014).
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[[Page 15000]]
38. While we understand that the implementation plan for
Reliability Standard EOP-012-1 is designed to accommodate entities that
may need time to determine Extreme Cold Weather Temperature values,
identify cold weather critical components for applicable generating
units, develop corrective action plans for freeze issues, perform
various engineering analyses, provide the required training, and
develop the necessary capabilities to satisfy revised data
specifications, industry has been aware of and alerted to the need to
prepare their generating units for cold weather since at least 2011.
Therefore, we direct NERC to reduce the implementation time and to
include a staggered implementation for Requirement R2 to reduce
reliability risks. NERC should consider the amount of time that
industry has already been alerted to the need to implement freeze
protection measures when determining the appropriate implementation
period. We also strongly encourage entities that are capable of
complying with these Standards earlier than the mandatory and
enforceable date to do so.
39. In addition to the directives to modify various aspects of
Reliability Standard EOP-012-1, we also have concerns regarding
generator owner constraint declarations and the adequacy of the Extreme
Cold Weather Temperature definition that may be addressed with
additional information. Therefore, pursuant to section 39.2(d) of the
Commission's regulations,\61\ NERC is hereby directed to work with
Commission staff to submit a plan no later than 12 months after the
date of issuance of this order on how it will collect and assess,
through annual and event-based data submittals, the following elements
of Reliability Standard EOP-012-1: (1) generator owner declared
constraints and explanations thereof; and (2) the adequacy of the
Extreme Cold Weather Temperature definition. NERC is hereby directed to
submit periodic reports to the Commission providing the results of the
assessments, as discussed in further detail below.
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\61\ 18 CFR 39.2(d).
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40. Below we address the following elements of Reliability Standard
EOP-012-1: (1) jurisdiction; (2) the applicability of Reliability
Standard EOP-012-1; (3) generator owner declarations for technical,
commercial, or operational constraints; (4) the Extreme Cold Weather
Temperature definition; (5) the absence of a deadline by which
generator owners must implement new or modified freeze protection
measures required by their corrective action plans; (6) cost recovery
mechanisms; (7) other technical matters; and (8) annual and event-based
data submittals.
1. Jurisdiction
a. Background
41. Section 215(a)(3) of the FPA defines ``Reliability Standard''
as:
a requirement, approved by the Commission under this section, to
provide for reliable operation of the bulk-power system. The term
includes requirements for the operation of existing bulk-power
system facilities, including cybersecurity protection, and the
design of planned additions or modifications to such facilities to
the extent necessary to provide for reliable operation of the bulk-
power system, but the term does not include any requirement to
enlarge such facilities or to construct new transmission capacity or
generation capacity.\62\
---------------------------------------------------------------------------
\62\ 16 U.S.C. 824o(a)(3).
42. The term ``Reliable Operation'' is defined by the statute as
``operating the elements of the bulk-power system within equipment and
electric system thermal, voltage, and stability limits so that
instability, uncontrolled separation, or cascading failures of such
system will not occur as a result of a sudden disturbance . . . or
unanticipated failure of system elements.'' \63\
---------------------------------------------------------------------------
\63\ Id. Sec. 824o(a)(4).
---------------------------------------------------------------------------
b. Comments
43. EPSA/PJM Group and Invenergy assert that Requirements R1 and R2
of Reliability Standard EOP-012-1 would impose obligations on generator
owners that ``fall outside of the scope'' of section 215 of the
FPA.\64\ Both provisions of Reliability Standard EOP-012-1 require
generator owners to add new, or modify existing, freeze protection
measures, with Requirement R1 pertaining to generating units with an
operational date subsequent to the effective date of the Reliability
Standard, and Requirement R2 pertaining to existing generating units.
---------------------------------------------------------------------------
\64\ See EPSA/PJM Group Comments at 5-7; Invenergy Comments at
13.
---------------------------------------------------------------------------
44. EPSA/PJM Group argue that while the definition of Reliable
Operation allows NERC to require modifications to address sudden
disturbances and unanticipated failures, ``the language of the section
is very clear that a Reliability Standard may only cover `the
operation' of existing facilities, where such operation shall only be
`within' equipment limits exclusively for the purpose of mitigating
`sudden disturbances' and `unanticipated failures.' '' \65\ In other
words, according to EPSA/PJM Group, the statute authorizes the
modification of existing facilities to reliably operate within their
existing equipment limits but does not permit a Reliability Standard
that changes a resource's equipment limits.\66\ In the same vein,
Invenergy asserts that it is unclear whether NERC has the authority
under section 215 of the FPA to mandate retrofits on existing
generators because the statutory definition of Reliability Standard is
limited to requirements ``for the operation of existing bulk-power
system facilities.'' \67\ According to Invenergy, this language
suggests that NERC can only mandate modifications when changes to a
facility are already planned.\68\
---------------------------------------------------------------------------
\65\ Id. (footnotes omitted).
\66\ Id. at 6.
\67\ Invenergy Comments at 13.
\68\ Id.
---------------------------------------------------------------------------
45. In its reply comments, NERC asserts that the requirements of
Reliability Standard EOP-012-1 that generator owners add freeze
protection measures is within the scope of its authority and that
commenters argue for an overly narrow interpretation of section 215 of
the FPA.\69\ According to NERC, EOP-012-1 satisfies a three-part
framework for analyzing whether a proposed Reliability Standard is
within the ERO's authority under the statute, namely that the Standard:
(1) applies to users, owners or operators of the Bulk-Power System; (2)
provides for the reliable operation of the Bulk-Power System; and (3)
may include operational or design requirements, but may not address
matters expressly excluded in the statute that were historically left
to the jurisdiction of the states. Focusing on the third prong, NERC
explains that Reliability Standard EOP-012-1 pertains to the operation
of existing facilities and the design of planned additions or
modifications to such facilities as needed to provide for the reliable
operation of the Bulk-Power System, which is explicitly included in the
statutory definition of Reliability Standard. NERC argues that, while
the statutory definition of Reliability Standard specifically excludes
``any requirement to enlarge [existing] facilities or to construct new
transmission capacity or generation capacity,'' EPSA/PJM Group's narrow
reading of the definition would write into the statute a new exclusion
that does not exist.
---------------------------------------------------------------------------
\69\ NERC Reply Comments at 3-11.
---------------------------------------------------------------------------
c. Commission Determination
46. We are not persuaded by EPSA/PJM Group and Invenergy's
arguments and conclude that Reliability Standard
[[Page 15001]]
EOP-012-1 Requirements R1 and R2 are within the statutory authority of
the ERO and the Commission. We agree with NERC that EPSA/PJM Group and
Invenergy narrowly interpret the terms ``Reliability Standard'' and
``Reliable Operation'' under section 215 of the FPA to reach an
inaccurate conclusion regarding the ERO and the Commission's statutory
authority.\70\
---------------------------------------------------------------------------
\70\ Id.; see also 16 U.S.C. 824o(a)(3)-(4).
---------------------------------------------------------------------------
47. First, Requirements R1 and R2 of EOP-012-1 comport with the
statutory definition of a Reliability Standard, which includes
modifications to facilities to the extent that they are necessary to
provide for the reliable operation of the Bulk-Power System.\71\
Reliability Standard EOP-012-1 Requirement R1 requires generating units
with a commercial operation date after the effective date of the
Standard to implement freeze protection measures so that the unit is
capable of continuous operation for at least 12 hours at the Extreme
Cold Weather Temperature or for the generator owner to submit a
declaration of a technical, commercial, or operational constraint that
preclude its ability to comply with the Standard. Requirement R2 of
EOP-012-1 requires existing generating units to either be capable of
continuous operation for at least one hour at the Extreme Cold Weather
Temperature or to develop a corrective action plan to resolve the
issue. Thus, Requirements R1 and R2's freeze protection provisions
serve an appropriate purpose, i.e., to provide the ``Reliable
Operation'' \72\ of the Bulk-Power System as set forth in the
definition of a ``Reliability Standard.'' \73\ Further, neither of
these requirements mandate the construction of new generation capacity
or an expansion of the unit's generating capacity, which are the only
relevant exclusions identified in the statutory definition of a
``Reliability Standard.'' \74\
---------------------------------------------------------------------------
\71\ 16 U.S.C. 824o(a)(3).
\72\ Id. section 824o(a)(4).
\73\ Id. section 824o(a)(3).
\74\ Id.
---------------------------------------------------------------------------
48. Moreover, we reject EPSA/PJM Group's interpretation of the
statutory definition of ``Reliable Operation'' as imposing a limitation
or exclusion on an acceptable Reliability Standard. EPSA/PJM Group
recognizes that under the definition of ``Reliable Operation'' NERC may
require modifications to mitigate ``sudden disturbances'' and
``unanticipated failures'' of facilities to the extent necessary to
provide for reliable Bulk-Power System operations.\75\ Indeed, the
Commission has previously approved Reliability Standards that require
the implementation of physical modifications to improve
reliability.\76\ Rather, EPSA/PJM Group reads a limitation into the
statutory definition of Reliable Operation--specifically ``within
equipment . . . limits''--and argues that the proposed Reliability
Standard would constitute an impermissible change to such equipment
limits. However, we do not find this argument to be persuasive as the
statutory language is not as narrow as EPSA/PJM Group suggests. When
read in context, the definition of ``Reliable Operation'' contemplates
that Reliability Standards should be designed so that facility
equipment operates within specified limits to mitigate sudden
disturbances and prevent unanticipated failures of system elements.\77\
---------------------------------------------------------------------------
\75\ EPSA/PJM Group Comments at 5 (citing to 16 U.S.C.
824(a)(4)).
\76\ See, e.g., Order No. 693, 118 FERC ] 61,218 at PP 1547,
1550 (approving Reliability Standard PRC-018-1, which requires the
installation of disturbance monitoring equipment); Mandatory
Reliability Standards for Critical Infrastructure Protection, Order
No. 706, 122 FERC ] 61,040, at P 86 (2008) (providing entities with
a reasonable amount of time to purchase and install new software and
equipment for compliance); PacifiCorp, 141 FERC ] 61,140 P 1 (2014).
\77\ 16 U.S.C. 824o(a)(4).
---------------------------------------------------------------------------
49. EPSA/PJM Group seizes upon language from the ``Reliability
Standard'' definition stating that the term ``includes requirements for
the existing bulk-power system facilities. . . .'' \78\ However, other
than EPSA/PJM Group's assertion, there is no logical reason to tie
together the language from these two definitions to limit the statutory
scope for the requirements of a Reliability Standard. Rather, in
context, the ``requirements for operation of existing . . .
facilities'' passage continues ``. . . including . . . the design of
planned additions or modification to such facilities to the extent
necessary to provide for reliable operation of the bulk-power system.''
\79\ This exactly describes the purpose of the freeze protection
requirements in EOP-012-1, which are intended to reduce capacity that
is forced off-line due to freezing conditions and to help ensure that
such capacity is not forced off-line in newer units. Accordingly, we
reject the arguments of EPSA/PJM Group that the requirements of EOP-
012-1 are beyond our or NERC's authority.
---------------------------------------------------------------------------
\78\ EPSA/PJM Group Comments at 5.
\79\ 16 U.S.C. 824o(a)(3).
---------------------------------------------------------------------------
50. For similar reasons, we reject Invenergy's argument that a
requirement to ``retrofit'' existing generators exceeds the statutory
definition of a Reliability Standard that is limited to requirements
``for the operation of existing bulk-power system facilities.'' \80\
Again, Invenergy would read in an exclusion beyond the one explicit
exclusion stated in the definition. Moreover, Invenergy's selected
quote ignores the language that follows which includes requirements for
``the operation of existing bulk-power system facilities . . . and the
design of planned additions or modifications to such facilities to the
extent necessary to provide for reliable operation of the bulk-power
system.'' \81\ As discussed above, Requirements R1 and R2's freeze
protection measures satisfy the latter provision, as the record shows
that these modifications are necessary to provide for the reliable
operation of the Bulk-Power System.
---------------------------------------------------------------------------
\80\ See Invenergy Comments at 13. But see NERC Petition Ex. A-
2, at 3-8 (the term ``retrofit'' not appearing in proposed
Reliability Standard EOP-012-1).
\81\ 16 U.S.C. 824o(a)(3).
---------------------------------------------------------------------------
2. Applicability of Reliability Standard EOP-012-1
51. NERC's Rules of Procedure requires all Reliability Standards to
include an applicability section that identifies (1) the registered
functional entities required to comply with each Standard and (2) the
bulk electric system facilities to which the requirements apply.\82\
Reliability Standard EOP-012-1's applicability section applies to
registered generator owners and generator operators. Further, the
facilities subject to the requirements of the standard include bulk
electric system generating units that are Blackstart Resources and any
bulk electric system generating unit that:
---------------------------------------------------------------------------
\82\ See NERC, Rules of Procedure, App. 3A (Standard Process
Manual), 5 (Mar. 2019), N. Am. Elec. Reliability Corp., 116 FERC ]
61,062, order on reh'g and compliance, 117 FERC ] 61,126 (2006),
aff'd sub nom. Alcoa, Inc. v. FERC, 564 F.3d 1342 (D.C. Cir. 2009).
commits or is obligated to serve a Balancing Authority load pursuant
to a tariff obligation, state requirement as defined by the relevant
electric regulatory authority, or other contractual arrangement,
rule, or regulation, for a continuous run of four hours or more at
or below a temperature of 32 degrees Fahrenheit (zero degrees
Celsius) \83\
---------------------------------------------------------------------------
\83\ Reliability Standard EOP-012-1, section 4.2.1.1.
52. NERC explains that the facilities section inclusions are
``carefully tailored to place the responsibility for cold weather
preparedness on those generating units that are being depended on to
operate in cold weather and on which the reliability of the system
depends'' and that the facilities section exclusions are meant to avoid
``undue burden on those generating
[[Page 15002]]
units that are not expected to operate in cold weather.'' \84\
---------------------------------------------------------------------------
\84\ NERC Petition at 30.
---------------------------------------------------------------------------
a. Comments
53. Invenergy questions which generator owner and generator
operators must comply with Reliability Standard EOP-012-1.
Specifically, Invenergy asserts that the applicability section of the
Standard is not clear and unambiguous as to which entities must comply.
Invenergy argues there are different types of generator owners that
vary widely in how they, with their generating units, participate in
electric markets, and requests that the Commission direct NERC to
modify proposed Reliability Standard EOP-012-1 to provide specific
criteria for which entities must comply.\85\
---------------------------------------------------------------------------
\85\ Invenergy Comments at 4.
---------------------------------------------------------------------------
b. Commission Determination
54. We agree with Invenergy that the applicability of Reliability
Standard EOP-012-1 is unclear and ambiguous. In its technical rationale
and justification, NERC explains that Reliability Standard EOP-012-1 is
not meant to require all generating units to provide capacity in
extreme cold weather. Instead, the Standard applies to those generating
resources that are ``obligated to serve Balancing Authority load during
periods at or below freezing due to commitments pursuant to tariff
obligations, state requirements defined by regulatory authorities, or
other contractual arrangements, rules, or regulations are subject to
the winterization requirements.'' \86\ Further, NERC explains that the
``[t]he [standard drafting team] chose the four-hour timeframe in
consideration of generators that typically do not commit during
freezing conditions but are running when conditions drop below freezing
for a short period of time . . . '' \87\ Lastly, NERC states that the
language is intended to act as a ``blanket inclusion of all [bulk
electric system] resources that serve Balancing Authority load for a
period of more than four hours in freezing conditions.'' \88\
---------------------------------------------------------------------------
\86\ NERC Petition, Ex. C-2, Technical Rationale and
Justification for EOP-012-1 at 1.
\87\ Id.
\88\ Id. at 2.
---------------------------------------------------------------------------
55. Despite this additional description regarding the standard
drafting team's intent, we are concerned that certain elements of the
applicability criteria remain unclear and ambiguous. For example, in
light of the multiple different approaches for participating in
electricity markets, it may not be clear under what circumstances a
generator owner is ``obligated to serve a Balancing Authority load.''
\89\ Similarly, while the intent appears to be to exclude units that do
not typically run during winter, it is unclear how the qualifier of
``for four hours or more'' is meant to be measured and applied in
practice.
---------------------------------------------------------------------------
\89\ Id. at 1.
---------------------------------------------------------------------------
56. We find that NERC has not sufficiently supported the
applicability criteria of EOP-012-1. Reliability Standard EOP-012-1
applies only to ``[a] Blackstart Resource'' or ``[a] Bulk Electric
System generating unit that commits or is obligated to serve . . .
pursuant to a tariff obligation, state requirement . . . , or other
contractual arrangement, rule, or regulation, for a continuous run of
four hours or more at or below a temperature of 32 degrees Fahrenheit
(zero degrees Celsius). . . .'' \90\ This applicability is further
limited by enumerated exemptions set forth in section 4.2.2. NERC
explains in its Petition that the Facilities section 4.2 of the
Reliability Standard, that limits applicability to an unidentified
subset of generating units, is meant to ``place the responsibility for
cold weather preparedness on those generating units that are being
depended on to operate in cold weather and on which the reliability of
the system depends, while avoiding undue burden on those generating
units that are not expected to operate in cold weather.'' \91\ But
based on commenter concerns and our reading of the plain text of the
Reliability Standard, the extent of Reliability Standard EOP-012-1's
applicability to bulk electric system facilities is unclear.
---------------------------------------------------------------------------
\90\ Reliability Standard, EOP-012-1, section 4.2.
\91\ NERC Petition at 30.
---------------------------------------------------------------------------
57. For example, it is unclear how the term ``continuous run''
would apply to intermittent resources, which by their nature are
variable and, therefore, do not always run continuously. Ensuring clear
applicability to intermittent generators is critical to ensuring that
enough generating units are available during cold temperatures.
58. Moreover, to the extent it is NERC's intent to exclude units
that do not typically run during winter from every requirement in the
Standard, we have concerns that this is not clearly articulated in
Reliability Standard EOP-012-1. In short, we are concerned that use of
the terms ``continuous run,'' ``commits or is obligated to serve'' and
``four hours or more,'' as well as the enumerated exemptions,
obfuscates the extent of applicability of Reliability Standard EOP-012-
1 and may not ensure that compliance is required for all ``generating
units that are being depended on to operate in cold weather and on
which the reliability of the system depends.'' \92\ Therefore, we
direct NERC, pursuant to FPA section 215(d)(5), to modify Reliability
Standard EOP-012-1 to ensure that it captures all bulk electric system
generation resources needed for reliable operation and excludes only
those generation resources not relied upon during freezing
conditions.\93\ As the directive is to clarify the language of the
applicability section to align with NERC's explanation of the entities
that should comply, there should be no need for additional
implementation time. Therefore, NERC should ensure the modified
applicability is implemented as of the effective date of Reliability
Standard EOP-012-1.
---------------------------------------------------------------------------
\92\ Id. at 30.
\93\ 16 U.S.C. 824o(d)(5) (stating that the Commission, ``upon
its own motion or upon complaint, may order the Electric Reliability
Organization 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 this section'').
---------------------------------------------------------------------------
59. Given the lack of clarity in the proposed applicability
criteria for EOP-012-1, we are concerned that the standard could apply
to significantly fewer generators than the existing Reliability
Standard EOP-011-2 Requirements R7 and R8. Thus, as Reliability
Standard EOP-011-2 requirements to implement and maintain cold weather
preparedness plan(s) and associated training applies to all bulk
electric system generating units, we defer our decision on whether to
approve or modify NERC's proposed implementation date for Reliability
Standard EOP-011-3 (and proposed retirement of Reliability Standard
EOP-011-2) until NERC submits its revised applicability section for
EOP-012. Allowing these requirements to remain mandatory and
enforceable will ensure all bulk electric system generating units are
required to maintain cold weather preparedness plans until such time as
the revised applicability criteria are effective for EOP-012.
60. Furthermore, we are concerned that the proposed applicability
criteria for EOP-012-1 and retirement of EOP-011-2 Requirements R7 and
R8 will eliminate valuable information on cold weather preparedness of
generating units that typically do not operate during the winter. Under
EOP-011-2, all bulk electric system generating units must identify in
cold weather preparedness plan(s) ``[g]enerating unit(s) cold weather
data'' including ``[g]enerating unit(s) operating limitations in cold
weather'' and
[[Page 15003]]
``[g]enerating unit(s) minimum . . . design temperature . . .
historical operating temperature . . . or current cold weather
performance temperature determined by an engineering analysis.'' This
data is to be exchanged with the reliability coordinator, transmission
operator, and balancing authority for planning and operations. The
November 2021 Report stated that ``[t]he intent behind requiring
[generator owners] to identify and share with the [balancing
authorities] and [transmission operators] the expected limitations of
their generating units `during local forecasted cold weather,' is to
prevent grid operators from being surprised when large numbers of
generating units that had committed to run are unable to do so during
cold weather events.'' \94\ Once EOP-012-1 goes into effect, and EOP-
011-2 Requirements R7 and R8 are retired, we are concerned that
generating units that do not typically operate during the winter will
no longer provide this information to reliability coordinators,
transmission operators, and balancing authorities. The loss of this
information concerns us as the proposed applicability of EOP-012-1
recognizes that units that do not typically run during the winter may
be called upon during emergencies. We therefore direct NERC to modify
EOP-012-1 to ensure that this information remains available.
---------------------------------------------------------------------------
\94\ November 2021 Report at 190-91.
---------------------------------------------------------------------------
3. The Allowance of Exceptions for Generator Owner-Defined Technical,
Commercial, or Operational Constraints
a. NERC Petition
61. Requirement R1 of EOP-012-1 requires a generator owner to
either implement freeze protection measures on its existing units that
provide capability to operate for a period of not less than 12
continuous hours at the Extreme Cold Weather Temperature for the unit
or ``[e]xplain in a declaration any technical, commercial, or
operational constraints that preclude the ability'' to comply with the
requirement.\95\ Similarly, Requirement R7 mandates that a generator
owner implement each corrective action plan developed pursuant to
Requirements R2, R4, or R6 ``or explain in a declaration why corrective
actions are not being implemented due to any technical, commercial, or
operational constraint as defined by the Generator Owner.'' \96\
---------------------------------------------------------------------------
\95\ NERC Petition Ex A-2, at 4.
\96\ Id. at 4-6.
---------------------------------------------------------------------------
b. Comments
62. Several commenters assert that the Requirements R1 and R7 in
Reliability Standard EOP-012-1 could benefit from increased clarity.
EPSA/PJM Group, NEPGA, and the ISO/RTO Council assert that the
generator owner declaration of constraints outlined in Requirement R1
and Requirement R7 are overly broad and that there is no explanation of
what technical, commercial, or operational constraints would be
permissible for generator owners to avoid both the implementation of
freeze protection measures and a corrective action plan.\97\
Specifically, EPSA/PJM Group contend that the broad discretion towards
generator owners to identify constraints in Requirements R1 and R7 may
lead to generator owners avoiding the implementation of freeze
protection measures (to lower their costs), thereby negatively
interfering with competition.\98\ The ISO/RTO Council states that this
generator owner discretion to determine what constraints are valid
without oversight could make enforcement difficult.\99\ Similarly,
Invenergy argues that this discretion could lead to uneven
implementation and enforcement.\100\ TCPA also requests that the
Commission clarify that a lack of cost recovery is a commercial
constraint to implementing Requirement R1 and R7.\101\ Finally,
commenters point out that there is no indication in the Standard of
which entity should receive the declaration of constraints from the
generator owner, if any.\102\
---------------------------------------------------------------------------
\97\ EPSA/PJM Group Comments at 7-9; ISO/RTO Council Comments at
10; NEPGA Comments at 7-8.
\98\ EPSA/PJM Group Comments at 7-9.
\99\ ISO/RTO Council Comments at 10-11.
\100\ Invenergy Comments at 8.
\101\ TCPA Comments at 2-3, 7-8.
\102\ E.g., ISO/RTO Council Comments at 10.
---------------------------------------------------------------------------
63. NERC, in its reply comments, states that provisions criticized
by commenters including the ``constraints'' provision represents a
balancing of competing opinions raised in the standards development
process. NERC opines that the petition provides a sound technical basis
for approving the Standards as filed, and reiterates that during the
second phase project, ``NERC may propose further changes to enhance the
clarity or effectiveness of the EOP-012 standard.'' \103\
---------------------------------------------------------------------------
\103\ NERC Reply Comments at 13.
---------------------------------------------------------------------------
c. Commission Determination
64. We share commenters' concerns regarding the uncertainty created
by the proposed technical, commercial, or operational constraint
provisions in Requirements R1 and R7, and that without criteria to
guide the generator owners, or guardrails on what constitutes a
legitimate technical, commercial, or operational constraint, entities
may either benefit financially by avoiding the purpose of the Standard
altogether or have declarations without auditable elements.\104\
Indeed, instead of implementing freeze protection measures, Requirement
R1 allows an entity to explain in a declaration the constraints that
preclude the ability to comply. Requirement R7 allows an entity to
explain in a declaration any technical, commercial, or operational
constraints as defined by the generator owner that prevent its
implementation of corrective actions set forth in a corrective action
plan pursuant to Requirements R2, R4 and R6. We are also concerned that
a generator owner may make the determination without informing planning
and operational entities (i.e., the reliability coordinator or
balancing authority) that are expecting the reliable operation of the
generating unit to its Extreme Cold Weather Temperature.
---------------------------------------------------------------------------
\104\ See, e.g., ISO/RTO Comments at 10 (cautioning that the
``broad undefined `commercial' exemption could lead to the exception
swallowing the rule'').
---------------------------------------------------------------------------
65. The Commission has previously encountered similar concerns
regarding the vagueness and enforceability of Reliability Standards
language. For example, in Order No. 693 the Commission approved
Reliability Standards while also expressing concern that the term
``sabotage'' was too ambiguous.\105\ Similarly, in Order No. 791
(approving Version 5 of the CIP Standards), the Commission raised
concerns with vague language that required entities to ``identify,
assess, and correct'' deficiencies. The Commission determined that the
ambiguities resulted in an ``unacceptable amount of uncertainty'' and
directed NERC to remove the ambiguous language and develop
modifications within one year.\106\ In both Order No. 693 and Order No.
791, the Commission approved NERC's proposed Reliability Standards as
an improvement to reliability, while directing NERC to submit
modifications to the Standards addressing the Commission's concern
regarding vagueness of particular language. We conclude that a similar
approach is appropriate in the immediate proceeding, given the
improvements offered by Reliability Standard EOP-
[[Page 15004]]
012-1 in addressing Bulk-Power System reliability during extreme cold
weather events.
---------------------------------------------------------------------------
\105\ Order No. 693, 118 FERC ] 61,218 at PP 1, 461.
\106\ See Order No. 791, 145 FERC ] 61,160 at PP 49-53, 67, 69.
---------------------------------------------------------------------------
66. Accordingly, we direct NERC, pursuant to section 215(d) of the
FPA, to develop and submit modifications to Reliability Standard EOP-
012-1 Requirements R1 and R7 to address concerns related to the
ambiguity of generator-defined declarations of technical, commercial,
or operational constraints that preclude a generator owner from
implementing the appropriate freeze protection measures and to ensure
that the constraint declarations may not be used to opt-out of
compliance with the Standard or obligations set forth in a corrective
action plan. Specifically, we direct NERC to include auditable criteria
on permissible constraints and to identify the appropriate entity that
would receive the generator owners' constraint declarations under EOP-
012-1 Requirements R1 and R7. We direct NERC to submit the revised
Reliability Standard no later than 12 months after the date of issuance
of this order.
67. TCPA requests that the Commission clarify that a ``lack of cost
recovery'' is a commercial constraint to implementing Requirement R1
and R7.\107\ TCPA argues that the ability of transmission service
providers and others to receive regulated rates of return creates an
uneven playing field for independent generation.\108\ We decline to
grant TCPA's proposed clarification. Granting TCPA's requested
clarification would be tantamount to a blanket waiver for all
generators that do not currently recover their costs through cost-of-
service rates.\109\ We believe it would be inappropriate to allow
entities participating in competitive wholesale electric markets to
simply opt-out of reliability improvements offered by NERC's proposal
because they lack a dedicated cost recovery mechanism.
---------------------------------------------------------------------------
\107\ TCPA Comments at 2-3, 7-8 (recommending that commercial
constraints be expanded to include economic issues).
\108\ Id. at 2.
\109\ This order discusses cost recovery mechanisms in more
detail in section 5.
---------------------------------------------------------------------------
68. Additionally, to provide the Commission with an ongoing
assessment of the risk to the Bulk-Power System, we direct that NERC
assess the implementation of the declarations through annual
informational data submittals filed with the Commission, discussed in
more detail in section 8.
4. The Calculation of the Extreme Cold Weather Temperature at Which a
Generating Unit Must Be Capable of Performing
a. NERC Petition
69. NERC proposes to define the term Extreme Cold Weather
Temperature as equal to the lowest 0.2 percentile of the hourly
temperatures measured in December, January, and February from January
1, 2000, through the date the temperature is calculated.\110\ According
to NERC, a statistical approach using modern weather data would advance
the reliability of the Bulk-Power System while also avoiding being
overly burdensome for those responsible for compliance.\111\
---------------------------------------------------------------------------
\110\ Id. at 24.
\111\ Id. at 25-27 (relying on the Modernization and Associated
Restructuring from the National Weather Service, which has higher
quality, more granular temperature data in more locations).
---------------------------------------------------------------------------
b. Comments
70. Some commenters express concern with the Extreme Cold Weather
Temperature definition.\112\ The ISO/RTO Council argues that only
examining historical data from the year 2000 forward risks
unnecessarily limiting the range of possible cold weather scenarios
that the Standard is intended to address, and proposes an alternate
calculation method.\113\ NEPGA/EPSA/PJM Group counters that the ISO/RTO
Council's proposed revisions materially change Reliability Standard
EOP-012-1, and should the Commission adopt the ISO/RTO proposal, then
efforts to comply with EOP-012-1 ``as drafted'' could be potentially
futile.\114\ Invenergy asserts that the Extreme Cold Weather
Temperature definition is arbitrary because NERC did not measure the
definition against any objective standard to ensure reliable
operation.\115\ Invenergy adds that the Extreme Cold Weather
Temperature should be calculated by NERC and its Regional Entities to
prevent uneven implementation and enforcement.\116\ Invenergy also
argues that it is unreasonable that the proposed Extreme Cold Weather
Temperature ``will be heavily influenced by the colder nighttime
temperatures, when there is no solar generation.'' \117\
---------------------------------------------------------------------------
\112\ NEPGA/EPSA/PJM Group Answer at 3-4; ISO/RTO Comments at 6.
\113\ ISO/RTO Council Comments at 7-9.
\114\ NEPGA/EPSA/PJM Group Answer at 3-8 (requesting that the
Commission not adopt the ISO/RTO Council's alternative Extreme Cold
Weather Temperature proposal).
\115\ Invenergy Comments at 7-8.
\116\ Id. at 8.
\117\ Id. at 7-8.
---------------------------------------------------------------------------
c. Commission Determination
71. As noted above, the Extreme Cold Weather Temperature is equal
to the lowest 0.2 percentile of the hourly temperatures measured in
December, January, and February from January 1, 2000, through the date
the temperature is calculated.\118\ This method of determining the
Extreme Cold Weather Temperature is a statistical approach, using the
cumulative distribution of historical temperatures to determine the 0.2
percentile historical temperature. NERC's petition explains it relied
on the Modernization and Associated Restructuring from the National
Weather Service, which has higher quality and more granular temperature
data in more locations, being completed in the year 2000 to justify the
elimination of all pre-2000 historical weather data from
consideration.\119\
---------------------------------------------------------------------------
\118\ NERC Petition at 24.
\119\ Id. at 25-27.
---------------------------------------------------------------------------
72. We find that NERC's Extreme Cold Weather Temperature definition
represents a reasonable starting point for reducing the level of risk.
The use of the Extreme Cold Weather Temperature to establish a specific
level of required freeze protection for resources is also a significant
improvement over the current cold weather Reliability Standards, which
contain no minimum temperature operating requirements.\120\ With
respect to the 0.2 threshold, we believe that NERC reasonably balanced
a number of competing factors in setting the Extreme Cold Weather
Temperature.\121\ Similarly, while we agree with the ISO/RTO Council
that additional data sources may be available, we find that NERC's
consideration of data availability and its determination to rely on
meteorological data starting in the year 2000 is reasonable. Similarly,
as the Extreme Cold Weather Temperature definition is meant to apply
uniformly regardless of generation type, we do not find it unreasonable
that solar generators would need to meet an Extreme Cold Weather
Temperature based on 24-hour-temperature data.\122\
---------------------------------------------------------------------------
\120\ See Order Approving Cold Weather Reliability Standards,
176 FERC ] 61,119, at P 1.
\121\ NERC Petition at 130 (relying on this approach to ensure
that the Extreme Cold Weather Temperature does not result in an
overly conservative design or preclude the generator owner from
using historical operating data to show compliance).
\122\ See Invenergy Comments at 7-8.
---------------------------------------------------------------------------
73. Although we agree that NERC could have adopted other,
potentially more robust approaches to defining the Extreme Cold Weather
Temperature, we believe that other factors such as application,
inspection, and
[[Page 15005]]
maintenance of the freeze protection measures and the associated
training of generator owners or generator operators that perform these
actions (all of which are requirements in the proposed Standard) should
reasonably improve reliable operation of the Bulk-Power System.
Further, recognizing that extreme cold weather temperatures could drop
below the Extreme Cold Weather Temperature during future events, the
need for periodic Extreme Cold Weather Temperature review \123\ and
updates \124\ based on the new cold weather temperatures will help
mitigate freezing issues over time, which could lessen the risk of
freeze-related outages not being subject to corrective action plans.
---------------------------------------------------------------------------
\123\ Reliability Standard EOP-012-1 already mandates a five-
year Extreme Cold Weather Temperature re-calculation and updates to
corrective actions where warranted.
\124\ The proposed Standard requires updates regardless of the
Extreme Cold Weather Temperature methodology used.
---------------------------------------------------------------------------
74. Accordingly, we are not persuaded by commenters that
modification to NERC's Extreme Cold Weather Temperature definition is
warranted at this time. Nevertheless, based on the concerns expressed
above, we direct that NERC assess the implementation of the definition
through event-based informational data submittals filed with the
Commission, discussed in more detail in section 8. Based on the results
of NERC's informational data submittals to the Commission, the
Commission will determine whether future modification to the Extreme
Cold Weather Temperature definition is warranted.
5. The Absence of a Deadline by Which Generator Owners Must Implement
the New or Modified Freeze Protection Measures Required by Their
Corrective Action Plans
a. NERC Petition
75. Requirement R7 of EOP-012-1 mandates that a generator owner
implement each corrective action plan developed pursuant to
Requirements R2, R4, or R6, or ``explain in a declaration why
corrective actions are not being implemented due to any technical,
commercial, or operational constraint as defined by the Generator
Owner.'' \125\ Requirement R7 also requires that the generator owner
update each corrective action plan if the actions or timetables change,
until the corrective action plan implementation is completed. But
Reliability Standard EOP-012-1 does not include a deadline for the
implementation completion of such plans.
---------------------------------------------------------------------------
\125\ NERC Petition at 43.
---------------------------------------------------------------------------
b. Comments
76. Some commenters express concern with Requirement R7 and the
implementation timeline for generator owner-developed corrective action
plans.\126\ Specifically, the ISO/RTO Council requests modification
because Requirement R7 does not explain when the implementation of the
developed corrective action plans should occur.\127\ The ISO/RTO
Council also argues that it is unclear to which entity or entities the
generator owner is supposed to provide its corrective action plan.\128\
TCPA asserts that it is unclear from EOP-012-1 when the corrective
actions outlined in the developed corrective action plans should be
completed.\129\
---------------------------------------------------------------------------
\126\ See, e.g., ISO/RTO Council Comments at 10-11; TCPA
Comments at 4, 6.
\127\ ISO/RTO Council Comments at 11.
\128\ Id. at 10.
\129\ TCPA Comments at 6.
---------------------------------------------------------------------------
c. Commission Determination
77. The NERC Glossary defines a ``corrective action plan'' as used
in EOP-012-1 as a ``list of actions and an associated timetable for
implementation to remedy a specific problem.'' \130\ As such, the
``corrective action plan[s]'' in EOP-012-1 are required to contain a
timetable for implementation completion and entities are required to
implement actions consistent with the timelines defined in the
corrective action plan under Requirement R7. While entities are
required to adhere to the timelines as defined in their corrective
action plans, some Reliability Standards establish a maximum time for
completion while others do not. For example, the Commission directed
NERC to add specific timelines for the completion of corrective action
plans to mitigate geomagnetic disturbances in Reliability Standard TPL-
007-1 (Transmission System Planned Performance for Geomagnetic
Disturbance Events).\131\ In contrast, the Commission has approved
other Reliability Standards requiring a corrective action plan that do
not require a specific deadline for the completion of the corrective
action plan.\132\
---------------------------------------------------------------------------
\130\ NERC Petition at 1013.
\131\ Reliability Standard for Transmission Sys. Planned
Performance for Geomagnetic Disturbance Events, Order No. 830, 156
FERC ] 61,215, at PP 101-04 (2016), reh'g denied, Order No. 830-A,
158 FERC ] 61,041 (2017) (directing NERC to modify TPL-007-1 to
include a two-year deadline after the development of a CAP to
complete the implementation of non-hardware mitigation and a four-
year deadline to complete hardware mitigation).
\132\ See, e.g., PRC-004-6 (Protection System Misoperation
Identification and Correction), Requirement R5 (requiring each
transmission owner, generator owner, and distribution owner that
owns a protection system component that caused misoperation to
develop a corrective action plan or explain in declaration why
corrective actions are beyond the entity's control).
---------------------------------------------------------------------------
78. In this instance, despite the lack of a deadline for
completion, we find it appropriate to approve the Standard while also
directing modification. We are persuaded that modifying the Standard to
include a maximum time for implementation completion is reasonable for
several reasons. First, having a requirement to implement a corrective
action plan by a date certain will provide a significant level of risk
reduction compared to the status quo. Second, the requirement to
implement a corrective action plan and to identify any temporary
operating limitations or effects to the cold weather preparedness plan
that would apply to entities until the execution of the corrective
actions by a date certain is an improvement to the Reliability
Standards.\133\ Finally, we do not find persuasive NERC's explanation
that competition for expert resources and supply chain challenges may
make setting a specific, uniform corrective action plan timeline for
all generating units difficult. The November 2021 Report recommends
that NERC's standard drafting team establish a maximum date that
corrective action plans must be completed.\134\ Otherwise, without a
maximum time for implementation, we are concerned that the time it
takes to complete the corrective action plans could allow identified
issues to remain unresolved for a significant period.
---------------------------------------------------------------------------
\133\ Id. Ex. A-2 at 6-7.
\134\ November 2021 Report at 187 (Key Recommendation 1d).
---------------------------------------------------------------------------
79. Accordingly, we direct NERC pursuant to FPA section 215(d)(5)
to modify Reliability Standard EOP-012-1 to address concerns related to
the lack of an implementation timeframe for corrective action plans.
Specifically, we direct NERC to include in the Standard a deadline or
maximum period for the implementation completion of corrective action
plans under the Standard. We direct NERC to submit the revised
Reliability Standard no later than 12 months after the date of issuance
of this order.
6. Cost Recovery Mechanisms
a. NERC Petition
80. Reliability Standard EOP-012-1 does not address cost recovery
mechanisms. However, NERC's petition
[[Page 15006]]
recognizes that generator owners can recover costs through markets or
cost recovery mechanisms approved by the state public utility
commissions.\135\
---------------------------------------------------------------------------
\135\ NERC Petition at 44 (citing to November 2021 Report at
191-92).
---------------------------------------------------------------------------
b. Comments
81. Some commenters assert that Reliability Standard EOP-012-1
should address cost recovery.\136\ TCPA asserts that the lack of a cost
recovery for competitive generators is a commercial constraint to
compliance with EOP-012-1 and requests that the Commission say so in
its order.\137\ The ISO/RTO Council asks the Commission to remove the
commercial constraint option from EOP-012-1 altogether.\138\ Invenergy
argues that the November 2021 Report recognized that generators should
be compensated for retrofits and that, while the NERC Reliability
Standards process may not be the appropriate forum to address cost
recovery, it is now incumbent on the Commission to address cost
recovery for generators required to comply with EOP-012-1.\139\ NEPGA
contends that a market change or other cost recovery mechanism must be
in place by the effective date of Reliability Standard EOP-012-1 and
asks the Commission to recognize the FPA's cost recovery
allowances.\140\ EPSA/PJM Group ask that the Commission begin a
proceeding under section 206 to address cost recovery for compliance
with Reliability Standards.\141\
---------------------------------------------------------------------------
\136\ See, e.g., EPSA/PJM Group Comments at 10-13.
\137\ TCPA Comments at 2.
\138\ ISO/RTO Council Comments at 10.
\139\ Invenergy Comments at 11-13.
\140\ NEPGA Comments at 2, 4-6.
\141\ EPSA/PJM Group Comments at 11, 13 (proffering that the
Commission could issue a show cause order pursuant to FPA section
206 to ensure that each ISO and RTO have cost recovery mechanisms in
place).
---------------------------------------------------------------------------
82. NERC and APPA/TAPS assert that cost recovery is outside the
scope of what Reliability Standards can address.\142\ Specifically,
APPA/TAPS contend that the Commission should not act in this proceeding
to provide competitive generators with a mechanism to recover cold
weather Standard compliance costs because the FPA does not mandate
special cost recovery mechanisms for competitive generators' section
215 compliance costs.\143\ APPA/TAPS state that adopting a separate
cost recovery mechanism for competitive generators' reliability
compliance costs would be inconsistent with the Commission's market-
based framework and could risk undercutting competitive markets.\144\
---------------------------------------------------------------------------
\142\ NERC Reply Comments at 10; APPA/TAPS Answer at 2-9.
\143\ APPA/TAPS Answer at 2-8.
\144\ Id. at 8-9.
---------------------------------------------------------------------------
c. Commission Determination
83. We find that the question of whether existing market mechanisms
provide an opportunity to recover the prudently incurred costs of
compliance with the proposed Standard and the request to initiate a
proceeding under FPA 206 are outside the scope of the instant
proceeding.
7. Other Technical Matters
a. Comments
84. Commenters raise other technical concerns touching on a variety
of elements of the Standard. For example, the ISO/RTO Council argues
that NERC's implementation plan may ``discourage earlier compliance''
and that the Commission should enact a shorter implementation plan
along with an exception process for generator owners that may
``legitimately need more time.'' \145\ The ISO/RTO Council recommends
revising the ``Generator Cold Weather Reliability Event'' definition to
account for generating units rated at or below 200 MW.\146\ The ISO/RTO
Council also expresses concern that corrective action plans under the
Standard only apply when the unit is unable to operate at or above the
Extreme Cold Weather Temperature.\147\ Additionally, the ISO/RTO
Council questions how EOP-012-1 interacts with tariff
requirements.\148\
---------------------------------------------------------------------------
\145\ ISO/RTO Council Comments at 15-16.
\146\ Id. at 16-17.
\147\ Id. at 11-12.
\148\ Id. at 13-15.
---------------------------------------------------------------------------
85. EPSA/PJM Group requests that Requirements R1 and R2 be removed
from EOP-012-1 and be replaced with a requirement that balancing
authorities instead ensure weather-resilient generation.\149\ For
Reliability Standard EOP-012-1 Requirement R1, TAPS requests that
compliance with the phrase ``provide the capability to operate'' be
based on sound engineering judgment, meaning subsequent failures during
cold weather not automatically lead to a violation since cold weather
events cannot be simulated ahead of time.\150\
---------------------------------------------------------------------------
\149\ EPSA/PJM Comments at 2.
\150\ TAPS Comments at 5-6.
---------------------------------------------------------------------------
86. TCPA requests clarification of when the five-year clock in
Requirement R4 begins and explanation how Requirement R7 requirement
for corrective action plans could be effective 18 months after
government approval when the standards for which the corrective action
plans would address (i.e., Requirements R2 and R4) are not effective
until 60 and 78 months after government approval.\151\ TCPA suggests
that generator owners only be required to provide annual compliance
progress reports.\152\ TCPA also raises issue with EOP-012-1's
violation severity level's lack of differentiation between single and
multiple facilities.\153\ Invenergy suggests revising NERC's
``Generator Cold Weather Reliability Event'' definition to align better
with the bulk electric system definition to ensure that corrective
action plans are only required when an actual Cold Weather Reliability
Event occurs.\154\ Invenergy and TCPA recommend eliminating the term
``continuous'' from EOP-012-1 Requirement R1 to reflect variable
generation and that solar and wind plants are unable to operate
continuously.\155\
---------------------------------------------------------------------------
\151\ TCPA Comments at 6.
\152\ Id.
\153\ Id. at 7.
\154\ Invenergy Comments at 2, 5-6.
\155\ Id. at 2, 9-10; TCPA Comments at 5.
---------------------------------------------------------------------------
87. NERC asserts that it is presently in phase two of its standard
development process and that its standard drafting team is presently
considering many of the issues raised in connection with this
proceeding.\156\ NERC encourages commenters in this proceeding to
continue participating in NERC's standard development process so that
their issues and concerns can be addressed.
---------------------------------------------------------------------------
\156\ NERC Reply Comments at 13.
---------------------------------------------------------------------------
b. Commission Determination
88. We share concerns with commenters regarding the implementation
period of Reliability Standard EOP-012-1, although we acknowledge
NERC's assertion that the time is necessary for generator owners to
calculate the Extreme Cold Weather Temperature for each generating
unit, to identify Generator Cold Weather Critical Components, and to
perform the necessary engineering studies and analyses to identify and
implement freeze protection measures that would provide for the
required performance capability or to explain why such measures are
precluded by technical, commercial, or operational constraints. To
address these concerns, we direct NERC to revise EOP-012 to require a
shorter implementation period and staggered implementation for unit(s)
in a generator owner's fleet.\157\ Such an approach will reduce
reliability risks more quickly. Although we are giving
[[Page 15007]]
NERC the discretion to determine what the effective date should be
shortened to, we also emphasize that industry has been aware of and
alerted to the need to prepare their generating units for cold weather
since at least 2011. NERC should consider the amount of time that
industry has already had to implement freeze protection measures when
determining the appropriate shorter implementation period. We direct
NERC to submit the revised implementation to Reliability Standard EOP-
012-1 no later than 12 months after the date of issuance of this order.
---------------------------------------------------------------------------
\157\ See, e.g., 146 FERC ] 61,213 at PP 1-2 (approving
Reliability Standard MOD-025-2 and its associated staggered
implementation plan).
---------------------------------------------------------------------------
89. For comments related to the ``continuous'' operation
requirements of EOP-012-1, the Reliability Standard is clear that it
requires generating units to be ``capable'' of operating continuously
for 12 hours, and not that the units must actually operate when they
would otherwise not be expected to operate. NERC states in its petition
that the 12-hour requirement is a minimum.\158\ However, we find the
phrase ``continuous operation'' to be confusing and subject to
conflicting interpretations. We also note that it creates confusion as
to whether certain generating units can ever be capable of compliance.
As Invenergy states, ``solar generators are not capable of operating in
a 12-hour period that extends beyond daylight hours, and, typically
when there are freezing temperatures, the sun does not even shine for
12 hours.'' \159\ And while Invenergy states that the ``Standard
Drafting Team indicated that the freeze protection measures must
provide the level of protection that would allow for 12 continuous
hours if the sun were to shine or the wind were to blow for the
period,'' \160\ the Reliability Standard Requirements in EOP-012-1 do
not specify that.\161\ Thus, we direct NERC to modify the Standard to
clarify Reliability Standard EOP-012-1 Requirement R1 to ensure that
generators that are technically incapable of operating for 12
continuous hours (e.g., solar facilities during winter months with less
than 12 hours of sunlight) are not excluded from complying with the
Standard. We direct NERC to submit the revised Reliability Standard no
later than 12 months after the date of issuance of this order.
---------------------------------------------------------------------------
\158\ Reliability Standard EOP-012-1 does not restrict longer
duration commitments of generating units, whether based on tariff
commitments, emergencies, or other conditions. See NERC Petition Ex.
C-2 at 5 (explaining that the intent of Requirement R1 is to
implement freeze protection measures such that facilities are
capable of continuous operation for not less than 12 hours)
(emphasis added).
\159\ Invenergy Comments at 9.
\160\ Id.
\161\ Order No. 693, 118 FERC ] 61,218 at P 253 (``The most
critical element of a Reliability Standard is the Requirements. As
NERC explains, `the Requirements within a standard define what an
entity must do to be compliant . . . [and] binds an entity to
certain obligations of performance under section 215 of the FPA.'
'').
---------------------------------------------------------------------------
90. We also find that the one-hour continuous operations
requirement in Reliability Standard EOP-012-1 Requirement R2 is too
short of a period to adequately meet the purpose of the Standard to
ensure generating units ``mitigate the reliability impacts of extreme
cold weather.'' \162\ Thus, we direct NERC to modify the one-hour
continuous operations requirement of Reliability Standard EOP-012-1
Requirement R2 to better align with the stated purpose of the
Reliability Standard EOP-012-1. We direct NERC to submit the revised
Reliability Standard no later than 12 months after the date of issuance
of this order.
---------------------------------------------------------------------------
\162\ NERC Petition at 29 (noting that freeze protection
measures of the Standard would advance the reliability of the Bulk-
Power System by helping to improve generator reliability in cold
weather).
---------------------------------------------------------------------------
91. We find that it is premature to address TCPA's recommendation
that generator owners only submit annual progress reports on
compliance.\163\ Nothing in proposed Reliability Standard EOP-012-1
mandates the submission of compliance reports and we are already
directing NERC to address periodic data submittals in this order.
---------------------------------------------------------------------------
\163\ TCPA Comments at 5.
---------------------------------------------------------------------------
92. Finally, for suggested revisions to NERC's ``Generator Cold
Weather Reliability Event'' definition to align better with the bulk
electric system definition, and requests that Requirements R1 and R2 be
removed from EOP-012-1 and be replaced with a requirement that
balancing authorities instead ensure weather-resilient generation,\164\
we decline to direct such modifications at this time.
---------------------------------------------------------------------------
\164\ EPSA/PJM Comments at 2.
---------------------------------------------------------------------------
8. Annual and Event-Based Data Submittals
93. NERC states that it plans to address data submittal
requirements in phase two of its standard development process.\165\ We
find that such data submittals are essential to assess the performance
of the Standards towards assuring the reliability of the Bulk-Power
System. Specifically, we find that additional data and analysis is
necessary to address the uncertainty created by the proposed technical,
commercial, or operational constraint provisions, as discussed above in
section 3. This data and analysis are essential to assess how the
generating units' freeze protection measures (implemented to provide
capability to operate at the Extreme Cold Weather Temperature) perform
in future extreme cold weather events, as discussed above in section 4.
---------------------------------------------------------------------------
\165\ NERC Petition at 54-55.
---------------------------------------------------------------------------
94. Accordingly, we direct that NERC, pursuant to section 39.2(d)
of the Commission's regulations, work with Commission staff to develop
and submit a plan within 12 months of the issuance of this order
explaining how it will gather data and submit an analysis that will
allow the Commission to understand the efficacy of, and monitor the
ongoing risk posed by: (1) proposed technical, commercial, or
operational constraint provisions in EOP-012-1, Requirements R1, R6,
and R7; and (2) actual performance of freeze protection measures during
future extreme cold weather events.
95. Regarding the proposed technical, commercial, or operational
constraint provisions in EOP-012-1, Requirements R1, R6, and R7, NERC
should work with Commission staff on the details of timing and what to
include in its plan, which, at a minimum, should include collection of
the following data: (1) the generating units that have declared
constraints under EOP-012-1 and the megawatts of generation that they
represent, organized by fuel type; (2) the megawatts of generation for
which declarations have been made for each type of constraint
(technical, commercial, or operational), organized by fuel type; (3)
the rationale(s) for each declaration; (4) the megawatts of generation
within the generation owner/operator's fleet currently capable of
operating at each unit's Extreme Cold Weather Temperature; (5) the
projected megawatts for which the generator owner/operator expects to
complete corrective action plans for each year; (6) the projected
megawatts for which the generator owner/operator expects to implement
corrective action plans for each year; and (7) the megawatts of
generating units identified as ``similar equipment'' \166\ to which the
generator owner has determined that the cause(s) for the Generator Cold
Weather Reliability Event are also applicable, under R6.2, while also
identifying any similar equipment that will receive a declaration. To
provide the Commission with an ongoing assessment of the risk to the
Bulk-Power System, NERC's plan should include an annual informational
filing to the Commission beginning 12 months after the mandatory and
enforceable date of the Standard. The informational filing should
include data on the seven foregoing categories aggregated at an
appropriate level (e.g.,
[[Page 15008]]
Regional Entity, balancing authority, etc.), and an analysis of the
efficacy of the requirements of the Standard based on the data.
Depending on the results of NERC's data collection and analysis, the
Commission will determine whether further modifications are needed to
the Standard.
---------------------------------------------------------------------------
\166\ For example, wind or solar equipment.
---------------------------------------------------------------------------
96. NERC's plan should also include how it will analyze the
performance of generating units' freeze protection measures
(implemented to provide capability to operate at the Extreme Cold
Weather Temperature) in future extreme cold weather events. Depending
on the results of NERC's data collection and analysis, the Commission
will determine whether further modifications are needed to the
definitions or the Standard.
IV. Information Collection Statement
97. The information collection requirements contained in this Final
Rule are subject to review by the Office of Management and Budget (OMB)
under section 3507(d) of the Paperwork Reduction Act of 1995.\167\
OMB's regulations require approval of certain information collection
requirements imposed by agency rules.\168\ Upon approval of a
collection of information, OMB will assign an OMB control number and
expiration date. Comments on the collection of information are due
within 60 days of the date this order is published in the Federal
Register. 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 Commission solicits comments on the Commission's
need for this information, whether the information will have practical
utility, the accuracy of the burden estimates, ways to enhance the
quality, utility, and clarity of the information to be collected or
retained, and any suggested methods for minimizing respondents' burden,
including the use of automated information techniques.
---------------------------------------------------------------------------
\167\ 44 U.S.C. 3507(d).
\168\ 5 CFR 1320 (2021).
---------------------------------------------------------------------------
98. The EOP Standards are currently located in the FERC-725S (OMB
Control No. 1902-0270) collection. The collection is currently approved
by OMB and contains Reliability Standards EOP-010-1, EOP-011-1, EOP-
004-4, EOP 005-3, EOP-006-3, EOP-008-2 (Table 1). In Docket No. RD23-1-
000, the Commission proposes to replace the current OMB approved
Reliability Standard EOP-011-1 \169\ with Reliability Standard EOP-011-
3 (Table 2) and add a new information collection line item for
Reliability Standard EOP-012-1 (Table 3).
---------------------------------------------------------------------------
\169\ The currently OMB approved FERC-725S includes the burden
related to Reliability Standard EOP-011-1. Reliability Standard EOP-
011-1 was superseded by Reliability Standard EOP-011-2, which was
approved by the Commission in Docket No. RD21-5-000 (issued August
24, 2021). Reliability Standard EOP-011-3, as noted in Docket No.
RD23-1-000, will supersede Reliability Standard EOP-011-2; thus, the
burdens resulting from Reliability Standard EOP-011-3 will be
reflected in the FERC-725S information collection.
---------------------------------------------------------------------------
99. The number of respondents below is based on an estimate of the
NERC compliance registry for balancing authorities, transmission
operators, generator operators, generator owners, and reliability
coordinators. Reliability Standards EOP-011-3 and EOP-012-1 apply to
balancing authorities, transmission operators, generator operators, and
reliability coordinators. The Commission based its paperwork burden
estimates on the NERC compliance registry as of November 4, 2022.
According to the registry, there are 98 balancing authorities, 168
transmission operators, 981 generator operators, 1,107 generator
owners, and 12 reliability coordinators. The estimates in the tables
below are based on the change in burden from the current EOP
Reliability Standards to the Reliability Standards approved in this
order. The Commission based the burden estimates in the tables below on
staff experience, knowledge, and expertise.
100. The estimates in the tables below are based, in combination,
on one-time (years 1 and 2) and ongoing execution (year 3) obligations
to follow the revised EOP Reliability Standards.
101. The Reliability Standard EOP-011-3 modifications transfer
Requirements R7 and R8 to Reliability Standard EOP-012-1, as described
below. For Reliability Standard EOP-011-3, transmission operators and
to a much lesser extent, balancing authorities, still have a one-time
cost to modify existing operating plans based on revisions to
Reliability Standard EOP-011-3 (Requirements R1 and R2) and to mitigate
operating emergencies related to cold weather conditions. Additionally,
reliability coordinators will need to review the modified operating
plans of the transmission operators. In year three and ongoing, the
transmission operator and reliability coordinator estimates are lower
to reflect lower paperwork burden for upkeep and review of the
operating plans for emergencies based on the modified Reliability
Standard EOP-011-3 to ensure that the new requirements are in place and
that applicable entities are following those plans.
102. The new Reliability Standard EOP-012-1, which is applicable to
1,107 generator owners and 981 generator operators, contains several
new requirements and two requirements from Reliability Standard EOP-
011-2 that have been moved to Reliability Standard EOP-012-1. In year
three and ongoing, the estimates are lower to reflect that the
implementation plan(s) to mitigate the reliability effects of extreme
cold weather conditions on generating units are in place and that
entities are familiar with the EOP-012-1 requirements.
103. Burden Estimates: The Commission estimates the changes in the
annual public reporting burden and cost as indicated in the tables
below:
[[Page 15009]]
Table 1--Current Costs and Burden Related to FERC-725S (1902-0270)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Annual number
Reliability standard and associated Number of of responses Total number of Average burden & cost per response Total annual burden & total annual cost Cost per
requirement respondents per respondent responses respondent ($)
(1) (2) (1) * (2) = (3) (4)...................................... (3) * (4) = (5)......................... (5) / (1)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
EOP-010-1............................... 181 1 181 20 hrs.; $1,660.......................... 3,620 hrs.; $300,460.................... $1,660
EOP-011-1............................... 12 1 12 1,500 hrs.; $124,500..................... 18,000 hrs.; $1,494,000................. 124,500
EOP-004-4, EOP-005-3, EOP-006-3, EOP-008- 280 1 280 250.58 \170\ hrs.; $20,798............... 70,162.4 hrs.; $5,234,440............... 20,798
2.
-------------------------------------------------------------------------------------------------------------------------------------------------------
Total EOP........................... 473 .............. ................. ......................................... 91,782 hrs.; $7,028,900................. ..............
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table 2--Proposed Changes Due to Final Rule in Docket No. RD23-1-000
--------------------------------------------------------------------------------------------------------------------------------------------------------
Number of
Reliability standard & Type\171\ and number annual Total number of Average number of
requirement of entity responses per responses burden hours per Total burden hours
entity response \172\
(1)................. (2) (1) * (2) = (3)....... (4)................... (3) * (4) = (5)
--------------------------------------------------------------------------------------------------------------------------------------------------------
FERC-725S--Proposed estimates due to RD23-1 for EOP-011-3
--------------------------------------------------------------------------------------------------------------------------------------------------------
One Time Estimate--Years 1 and 2 EOP-011-3
--------------------------------------------------------------------------------------------------------------------------------------------------------
EOP-011-3..................... 168 (TOP)........... 1 168................... 60 hrs. $3,893.40..... 10,080 hrs. $654,091.2.
EOP-011-3 \173\............... 98 (BA)............. 1 98.................... 6 hrs. $389.34........ 588 hrs. $38,155.32.
EOP-011-3 \174\............... 12 (RC)............. 1 12.................... 28 hrs. $1,816.92..... 336 hrs. $21,803.04.
---------------------------------------------------------------------------------------------------
Sub-total of EOP-011-3 .................... .............. 278................... ...................... 11,004 hrs. $714,049.56.
(One time).
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ongoing Estimate--Year 3 ongoing EOP-011-3
--------------------------------------------------------------------------------------------------------------------------------------------------------
EOP-011-3 \175\............... 168 (TOP)........... 1 168................... 10 hrs. $648.90....... 1,680 hrs. $109,015.20.
EOP-011-3 \176\............... 98 (BA)............. 1 98.................... 10 hrs. $648.90....... 980 hrs. $63,592.20.
EOP-011-3 \177\............... 12 (RC)............. 1 12.................... 14 hrs. $908.46....... 168 hrs. $10,901.52.
---------------------------------------------------------------------------------------------------
Sub-Total of EOP-011-3 .................... .............. 278................... ...................... 2,828 $183,508.92.
(ongoing).
---------------------------------------------------------------------------------------------------
Sub-Total of ongoing .................... .............. 92.67 (rounded)....... ...................... 942.67 hrs. (rounded)
burden averaged over $61,169.64.
three years.
---------------------------------------------------------------------------------------------------
Proposed Total Burden .................... .............. 370.67................ ...................... 11,946.67 hrs.
Estimate of EOP-011-3. $775,219.42 (rounded).
--------------------------------------------------------------------------------------------------------------------------------------------------------
Table 3--Proposed Changes Due to Final Rule in Docket No. RD23-1-000 for EOP-012-1
--------------------------------------------------------------------------------------------------------------------------------------------------------
Number of
Reliability standard & Type and number of annual Total number Average number of burden
requirement entity responses per of responses hours per response \178\ Total burden hours
entity
(1)................. (2) (1) * (2) = (4)....................... (3) * (4) = (5)
(3)
--------------------------------------------------------------------------------------------------------------------------------------------------------
FERC--725S
--------------------------------------------------------------------------------------------------------------------------------------------------------
One Time Estimate--Years 1 and 2 EOP-012-1
--------------------------------------------------------------------------------------------------------------------------------------------------------
EOP-012-1 \179\............... 1,107 (GO).......... 1 1,107 150 hrs. $9,733.50........ 166,050 hrs. $10,774,984.50.
EOP-012-1..................... 981 (GOP)........... 1 981 10 hrs. $648.90........... 9,810 hrs. $636,570.90.
---------------------------------------------------------------------------------------------------
Sub-Total for EOP-012-1 .................... .............. 2,088 160 hrs. $10,382.40....... 175,860 hrs. $11,411,555.40.
(one-time).
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ongoing Estimate--Year 3 ongoing EOP-012-1
--------------------------------------------------------------------------------------------------------------------------------------------------------
EOP-012-1..................... 1,107 (GO).......... 1 1,107 40 hrs. $2,595.60......... 40,680 hrs. $2,639,725.20.
EOP-012-1..................... 981 (GOP)........... 1 981 10 hrs. $648.90........... 9,810 hrs. $636,570.90.
---------------------------------------------------------------------------------------------------
Sub-Total for EOP-012-1 .................... .............. 2,088 50 hrs. $3,244.50......... 50,490 hrs. $3,276,296.10.
(ongoing).
---------------------------------------------------------------------------------------------------
Sub-Total of ongoing .................... .............. 696 .......................... 16,830 hrs. $1,092,098.70.
burden averaged over
three years.
---------------------------------------------------------------------------------------------------
Proposed Total Burden .................... .............. 2,784 .......................... 192,690 hrs. $12,503,654.10.
Estimate of EOP-012-1.
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 15010]]
Changes to FERC 725S by RD23-1-000
--------------------------------------------------------------------------------------------------------------------------------------------------------
FERC-725S modification Current............. Current Total change due to RD23-1-000
inventory........... inventory
(hours)............. (responses)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Removal of EOP-011-1.......... 18,000.............. 12 -18,000 hrs.; -12 responses.
Updates to EOP-011-3.......... .................... .............. +11,946.67 hrs.; +370.67 responses.
Addition of EOP-012-1......... .................... .............. +192,690 hrs.; +2,784 responses.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Titles: FERC-725S, Mandatory Reliability Standards for the Bulk-
Power System; EOP Reliability Standards.
---------------------------------------------------------------------------
\170\ Burden hours per response may also include any methods for
improvement not limited to trainings, drills, simulations, testing,
etc.
\171\ TOP=Transmission Operator, BA=Balancing Authority,
GO=Generator Owner, GOP=Generator Operator and RC=Reliability
Coordinator.
\172\ The estimated hourly cost (salary plus benefits) is a
combination based on the Bureau of Labor Statistics (BLS), as of
2022, for 75% of the average of an Electrical Engineer (17-2071)-
$77.02, mechanical engineers (17-2141)-$67.79. $77.02 + $67.79/2 =
72.405 x .75 = 54.303 ($54.30-rounded) ($54.30/hour) and 25% of an
Information and Record Clerk (43-4199) $42.35 x .25% = 10.5875
($10.59 rounded) ($10.59/hour), for a total ($54.30 + $10.59 =
$64.89/hour).
\173\ Reduce the estimate for balancing authorities from EOP-
011-2 down from previous 60 hours to 6 hours for EOP-011-3.
\174\ Reduce the estimate for reliability coordinators from EOP-
011-2 down from previous 40 hours to 28 hours for EOP-011-3.
\175\ Reduce the estimate for transmission operators from EOP-
011-2 down from previous 50 hours to 10 hours for EOP-011-3.
\176\ Reduce the estimate for balancing authorities from EOP-
011-2 down from previous 50 hours to 10 hours for EOP-011-3.
\177\ Reduce the estimate for reliability coordinators from EOP-
011-2 down from previous 20 hours to 14 hours for EOP-011-3.
\178\ The estimated hourly cost (salary plus benefits) is a
combination based on the Bureau of Labor Statistics (BLS), as of
2022, for 75% of the average of an Electrical Engineer (17-2071)-
$77.02, mechanical engineers (17-2141)-$67.79. $77.02 + $67.79/2 =
72.405 x .75 = 54.303 ($54.30-rounded) ($54.30/hour) and 25% percent
of an Information and Record Clerk (43-4199) $42.35 x .25% = 10.5875
($10.59 rounded) ($10.59/hour), for a total ($54.30 + $10.59 =
$64.89/hour).
\179\ The estimates for the generator owner and generator
operator are being moved from the current EOP-011-2 to the new EOP-
012-1.
---------------------------------------------------------------------------
Action: Modifications to Existing Collections of Information in
FERC-725S.
OMB Control Nos: 1902-0270 (FERC-725S).
Respondents: Business or other for profit, and not for profit
institutions.
Frequency of Responses: On occasion (and proposed for deletion).
Necessity of the Information: Reliability Standards EOP-011-3
(Emergency Operations), and EOP-012-1 (Extreme Cold Weather
Preparedness and Operations) are part of the implementation of the
Congressional mandate of the Energy Policy Act of 2005 to develop
mandatory and enforceable Reliability Standards to better ensure the
reliability of the nation's Bulk-Power system. Specifically, the
revised and new Reliability Standards ensure that generating resources
are prepared for local cold weather events and that entities will
effectively communicate the information needed for operating the Bulk-
Power System.
Internal review: The Commission has reviewed NERC's proposal and
determined that its action is necessary to implement section 215 of the
FPA.
104. Interested persons may obtain information on the reporting
requirements by contacting the Federal Energy Regulatory Commission,
Office of the Executive Director, 888 First Street NE, Washington, DC
20426 [Attention: Ellen Brown, email: [email protected], phone:
(202) 502-8663, fax: (202) 273-0873].
105. Comments concerning the information collections and
requirements approved for retirement in this Final Rule and the
associated burden estimates, should be sent to the Commission in this
docket and may also be sent to the Office of Management and Budget,
Office of Information and Regulatory Affairs [Attention: Desk Officer
for the Federal Energy Regulatory Commission]. For security reasons,
comments should be sent by email to OMB at the following email address:
[email protected].
V. Document Availability
106. 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 (https://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.
107. 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.
108. User assistance is available for eLibrary and the Commission's
website during normal business hours from the Commission's Online
Support at (202) 502-6652 (toll free at 1-866-208-3676) or email at
[email protected], or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at
[email protected].
The Commission orders:
(A) Reliability Standards EOP-011-3 and EOP-012-1, the associated
violation risk factors and violation severity levels, and the newly
defined terms Generator Cold Weather Critical Component, Extreme Cold
Weather Temperature, and Generator Cold Weather Reliability Event, are
hereby approved, as discussed in the body of this order.
(B) NERC is hereby directed to develop and submit, within 12 months
of the date of issuance of this order, modifications to Reliability
Standard EOP-012-1 as discussed in the body of this order.
(C) NERC is hereby directed to work with Commission staff to submit
a plan no later than 12 months after the date of issuance of this order
on how it will collect and assess data prior to and on the
implementation of the following elements of Reliability Standard EOP-
012-1: (1) generator owner declared constraints and explanations
thereof; and (2) the adequacy of the Extreme
[[Page 15011]]
Cold Weather Temperature definition, as discussed in the body of this
order.
(D) NERC is hereby directed to assess annual and event-based data
submittals to address the following elements of Reliability Standard
EOP-012-1: (1) generator owner declared constraints and explanations
thereof; and (2) the adequacy of the Extreme Cold Weather Temperature
definition, and to submit periodic reports to the Commission providing
the results of the assessments, as discussed in the body of this order.
By the Commission.
Issued: February 16, 2023.
Kimberly D. Bose,
Secretary.
[FR Doc. 2023-04875 Filed 3-8-23; 11:15 am]
BILLING CODE 6717-01-P
