North American Electric Reliability Corporation; Order Approving Extreme Cold Weather Reliability Standard EOP-012-2 and Directing Modification, 55239-55254 [2024-14668]

Download as PDF Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices FERC conferences are accessible under section 508 of the Rehabilitation Act of 1973. For accessibility accommodations please send an email to accessibility@ferc.gov or call toll free (866) 208–3372 (voice) or (202) 502– 8659 (TTY), or send a fax to (202) 208– 2106 with the required accommodations. For further information about this workshop, please contact: Michael G. Henry (Technical Information). Office of Energy Policy and Innovation, 202–502–8583, Michael.Henry@ferc.gov Lewis Taylor (Legal Information), Office of General Counsel, 202–502–8624, Lewis.Taylor@ferc.gov Dated: June 27, 2024. Debbie-Anne A. Reese, Acting Secretary. [FR Doc. 2024–14675 Filed 7–2–24; 8:45 am] BILLING CODE 6717–01–P DEPARTMENT OF ENERGY Federal Energy Regulatory Commission [Docket Nos. RD24–5–000; RD24–1–000] khammond on DSKJM1Z7X2PROD with NOTICES North American Electric Reliability Corporation; Order Approving Extreme Cold Weather Reliability Standard EOP–012–2 and Directing Modification 1. On February 16, 2024, the North American Electric Reliability Corporation (NERC), the Commissioncertified Electric Reliability Organization (ERO), submitted a petition seeking approval of proposed Reliability Standard EOP–012–2 (Extreme Cold Weather Preparedness and Operations). As discussed in this order, we approve proposed Reliability Standard EOP–012–2, its associated violation risk factors and violation severity levels, NERC’s proposed implementation plan, the newly defined terms Fixed Fuel Supply Component and Generator Cold Weather Constraint, the revised defined terms Generator Cold Weather Critical Component and Generator Cold Weather Reliability Event, and the retirement of Reliability Standard EOP–012–1 immediately prior to the effective date of proposed Reliability Standard EOP–012–2.1 We also approve NERC’s proposed implementation date for Reliability Standard EOP–011–4 and the proposed retirement of Reliability Standards EOP–011–2 and EOP–011–3 immediately prior to the effective date 1 16 U.S.C. 824o(d)(2). VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 of proposed Reliability Standard EOP– 012–2.2 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.’’ 3 When extreme cold weather events such as Winter Storms Uri or Elliott occur, the Bulk-Power System cannot operate reliably without adequate generation. Proposed Reliability Standard EOP–012–2 improves upon the approved, but not yet effective, Reliability Standard EOP– 012–1 by clarifying the requirements for generator cold weather preparedness and by making other improvements consistent with the Commission’s directives in its February 2023 Order to help ensure that more generation is available during extreme cold weather.4 Accordingly, we find that proposed Reliability Standard EOP–012–2 is just, reasonable, not unduly discriminatory or preferential, and in the public interest. 3. Nevertheless, we find that proposed Reliability Standard EOP–012–2 requires improvement to address certain concerns, as discussed further below. Therefore, pursuant to section 215(d)(5) of the Federal Power Act (FPA),5 we direct NERC to: (1) develop and submit modifications to proposed Reliability Standard EOP– 012–2 to address concerns related to the ambiguity of the newly defined term Generator Cold Weather Constraint to ensure that the Generator Cold Weather Constraint declaration criteria included within the proposed Standard are objective and sufficiently detailed so that applicable entities understand what is required of them and to remove all references to ‘‘reasonable cost,’’ ‘‘unreasonable cost,’’ ‘‘cost,’’ and ‘‘good business practices’’ and replace them with objective, unambiguous, and auditable terms; (2) develop and submit modifications to proposed Reliability Standard EOP– 012–2 for NERC to receive, review, evaluate, and confirm the validity of each Generator Cold Weather Constraint invoked by a generator owner, in a timely fashion, to ensure that such declaration cannot be used to avoid 2 Id. 3 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). 4 See, e.g., N. Am. Elec. Reliability Corp., 182 FERC ¶ 61,094, PP 3–11 (2023) (February 2023 Order); reh’g denied, 183 FERC ¶ 62,034, order on reh’g, 183 FERC ¶ 61,222 (2023). 5 16 U.S.C. 824o(d)(5). PO 00000 Frm 00024 Fmt 4703 Sfmt 4703 55239 mandatory compliance with the proposed Reliability Standard or obligations in a corrective action plan; (3) develop and submit modifications to proposed Reliability Standard EOP– 012–2 to shorten and clarify the corrective action plan implementation timelines and deadlines in Requirement R7, as further directed below; (4) develop and submit modifications to Requirement R7 of proposed Reliability Standard EOP–012–2 to ensure that any extension of a corrective action plan implementation deadline beyond the maximum implementation timeframe required by the Standard is pre-approved by NERC and to ensure that the generator owner informs relevant registered entities of operating limitations in extreme cold weather during the period of the extension; and (5) develop and submit modifications to Requirement R8, part 8.1 of proposed Reliability Standard EOP–012–2 to implement more frequent reviews of Generator Cold Weather Constraint declarations to verify that the constraint declaration remains valid. 4. The Commission has repeatedly expressed an urgency in completing cold weather Reliability Standards and having them implemented in a timely manner to address the risks presented by cold weather events on the reliability of the Bulk-Power System.6 Further, we note that NERC submitted the current filing in response to Commission directives to improve the cold weather Reliability Standards, and the five core directives to NERC in this order are not new issues, but rather targeted modifications necessary to fully address issues identified in the Commission’s prior February 2023 Order. Accordingly, we direct NERC to make the above modifications and submit the revised Reliability Standard within nine months of the date of issuance of this order.7 I. Background A. Section 215 and Mandatory Reliability Standards 5. 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.8 Reliability 6 See e.g., N. Am. Elec. Reliability Corp., 183 FERC ¶ 62,034 at P 10 (emphasizing that industry has been aware of and alerted to the need to prepare generating units for cold weather since at least 2011 and that in considering an appropriate implementation period for Reliability Standard EOP–012–1, NERC should consider how much time industry has already had to implement freeze protection measures). 7 18 CFR 39.6(g) (2023). 8 16 U.S.C. 824o(c). E:\FR\FM\03JYN1.SGM 03JYN1 55240 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices Standards may be enforced by the ERO, subject to Commission oversight, or by the Commission independently.9 Pursuant to section 215 of the FPA, the Commission established a process to select and certify an ERO,10 and subsequently certified NERC.11 B. The February 2021 Cold Weather Reliability Event 6. On February 16, 2021, Commission, NERC, and Regional Entity staff initiated a joint inquiry into the circumstances surrounding a February 2021 cold weather reliability event then affecting Texas and the South-Central United States. In November 2021, Commission staff issued a report regarding the event, which found that the 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.12 The November 2021 Report made 28 recommendations including, inter alia, enhancements to the Reliability Standards to improve extreme cold weather operations, preparedness, and coordination.13 7. 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 report regarding a 2018 cold weather event.14 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).15 Reliability Standards IRO–010–4 and TOP–003–5 require that reliability coordinators, transmission operators, and balancing authorities develop, maintain, and share generator cold 9 Id. sec. 824o(e). 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); see also 18 CFR 39.4(b) (2023). 11 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). 12 See November 2021 Report at 9. 13 Id. at 184–212 (sub-recommendations 1a through 1j). 14 FERC and NERC Staff, The South Central United States Cold Weather Bulk Electric System Event of January 17, 2018, at 89 (Jul. 2019), https:// www.ferc.gov/sites/default/files/2020-07/ SouthCentralUnitedStatesCold WeatherBulkElectricSystemEventofJanuary172018.pdf. 15 See generally N. Am. Elec. Reliability Corp., 176 FERC ¶ 61,119 (2021). khammond on DSKJM1Z7X2PROD with NOTICES 10 Rules VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 weather data.16 Reliability Standard EOP–011–2 requires generator owners to have generating unit cold weather preparedness plans.17 8. On October 28, 2022, NERC filed a petition seeking approval of Reliability Standards EOP–011–3 (Emergency Operations) and EOP–012–1 (Extreme Cold Weather Preparedness and Operations), their 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 Reliability Standard EOP– 011–2.18 On February 16, 2023, the Commission approved Reliability Standards EOP–011–3 and EOP–012–1, directed NERC to develop and submit modifications to Reliability Standard EOP–012–1 and to submit a plan on how NERC will collect and assess data surrounding the implementation of Reliability Standard EOP–012–1, and deferred the retirement of Reliability Standard EOP–011–2.19 9. On October 30, 2023, NERC filed a petition seeking approval of Reliability Standards EOP–011–4 (Emergency Operations) and TOP–002–5 (Operations Planning), their associated violation risk factors and violation severity levels, NERC’s proposed implementation plan, and the retirement of Reliability Standards EOP–011–2 and TOP–002–4. On February 15, 2024, the Commission approved Reliability Standards EOP– 011–3 and TOP–002–5 and again deferred the retirement of Reliability Standard EOP–011–2.20 C. NERC’s Petition and Proposed Reliability Standard EOP–012–2 10. On February 16, 2024, in response to the Commission’s February 2023 Order, NERC filed a petition seeking approval of proposed Reliability Standard EOP–012–2,21 its associated violation risk factors and violation severity levels, two newly defined terms (Fixed Fuel Supply Component and Generator Cold Weather Constraint), two revised terms (Generator Cold Weather Critical Component and 16 Id. 17 Id. 2022 Petition at 1–2. February 2023 Order, 182 FERC ¶ 61,094 at PP 3–11. 20 See id. PP 1–2. 21 The proposed Reliability Standard EOP–012–2 is not attached to this order. The proposed Reliability Standard is available on the Commission’s eLibrary document retrieval system in Docket No. RD24–5–000 and on the NERC website, www.nerc.com. PO 00000 18 NERC 19 See Frm 00025 Fmt 4703 Sfmt 4703 Generator Cold Weather Reliability Event), NERC’s proposed implementation plan, and the retirement of currently approved Reliability Standard EOP–012–1.22 NERC explains that proposed Reliability Standard EOP–012–2 improves upon the approved, but not yet effective, generator cold weather preparation Reliability Standard EOP–012–1 and is consistent with the Commission’s directives from the February 2023 Order.23 NERC states that proposed Reliability Standard EOP–012–2 clarifies applicability of the Standard’s requirements for generator cold weather preparedness, would further define the circumstances under which a generator owner may declare that constraints preclude it from implementing one or more corrective actions to address freezing issues, and shortens the implementation timeline so that cold weather reliability risks would be addressed sooner.24 11. NERC states that the purpose of proposed Reliability Standard EOP– 012–2 is unchanged from that of approved Reliability Standard EOP– 012–1, which is to ensure that each generator owner develops and implements plans to alleviate the reliability impacts of extreme cold weather on its generating units.25 NERC also notes that proposed Reliability Standard EOP–012–2 completes NERC’s two-part plan to address recommendations from the November 2021 Report by including revisions to address parts of Key Recommendations 1a, 1b, 1c, and 1d.26 NERC states that the proposed Reliability Standard contains new and revised requirements to advance the reliability of the BulkPower System by requiring generator owners to (1) review their generator cold weather data periodically, (2) include any identified start up issues in their generator cold weather data provided to reliability entities, and (3) consider the impacts of freezing precipitation and wind speed in identifying generator cold weather data.27 12. Proposed Reliability Standard EOP–012–2 has eight requirements, seven of which have been carried over and modified from approved Reliability Standard EOP–012–1 (Requirements R1–R7) and one of which is new (Requirement R8). Proposed Reliability Standard EOP–012–2 applies to 22 NERC 23 Id. Petition at 1–4. at 2. 24 Id. 25 Id. at 29. id. at 25–26, 35, 49–50 (citing the November 2021 Report at 184–86). 27 Id. at 23. 26 See E:\FR\FM\03JYN1.SGM 03JYN1 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices generator owners and generator operators that own or operate bulk electric system generating units.28 13. Proposed Reliability Standard EOP–012–2, Requirement R1 modifies the Requirements for each generator owner to calculate the Extreme Cold Weather Temperature for each of its applicable generating units and to recalculate that temperature at least once every five calendar years.29 Where a periodic re-calculation results in a lower Extreme Cold Weather Temperature for the generating unit, the generator owner must update its cold weather preparedness plan within six months and, if necessary, develop a corrective action plan to implement measures at the applicable unit to provide the capability to operate at that new, lower temperature. Proposed Reliability Standard EOP–012–2, Requirement R1, Part 1.2, also maintains Requirement R3.1 to identify generating unit cold weather data, including operating limitations in cold weather and minimum operating temperatures, from approved Reliability Standard EOP– 012–1, Requirement R3, Part 3.5.30 14. Proposed Reliability Standard EOP–012–2, Requirements R2 and R3 clarify the cold weather operational capability requirements for new and existing bulk electric system generating units.31 Under proposed Reliability Standard EOP–012–2, Requirement R2, generator owners would be required to implement freeze protection measures at applicable bulk electric system generating units to provide the capability to operate at the Extreme Cold Weather Temperature with sustained, concurrent 20 mph wind speed for the unit.32 Specifically, Requirement R2 requires generating units with a commercial operation date on or after October 1, 2027, to be capable of operating at the unit’s Extreme Cold Weather Temperature for a continuous 12-hour period or at the maximum operational duration for intermittent energy resources if less than 12 continuous hours. If a generating unit is unable to do either then it must develop a corrective action plan to add new or modify existing or previously planned freeze protection 28 NERC Petition at 22–23. R1 under proposed Reliability Standard EOP–012–2 modifies existing Requirement R3, Part 3.1 and Requirement R4 under currently approved but not yet effective Reliability Standard EOP–012–1. 30 NERC Petition at 33–37. 31 Requirements R2 and R3 under proposed Reliability Standard EOP–012–2 were originally Requirements R1 and R2, respectively, under currently approved but not yet effective Reliability Standard EOP–012–1. 32 NERC Petition at 37. khammond on DSKJM1Z7X2PROD with NOTICES 29 Requirement VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 measures to provide the capability to operate at the unit’s Extreme Cold Weather Temperature with a sustained, concurrent 20 mph wind speed.33 15. Similar to Requirement R2, but without the wind and duration criteria, Requirement R3 requires either that existing generating units, (i.e., those in commercial operation prior to October 1, 2027) be capable of operating at the unit’s Extreme Cold Weather Temperature or that the generator owner develops a corrective action plan to address the unit’s inability to continuously operate successfully.34 Requirements R2 and R3 exempt generating units that do not self-commit or are not required to operate at or below a temperature of 32 degrees Fahrenheit, including those that may be called upon to operate to assist in mitigating emergencies during periods at or below 32 degrees Fahrenheit.35 16. Proposed Reliability Standard EOP–012–2, Requirement R4,36 modifies the requirement for generator owners to implement and maintain cold weather preparedness plans.37 Under Requirement R4, generator owners would include in their cold weather preparedness plans the information determined in accordance with proposed Reliability Standard EOP– 012–2, Requirement R1. Requirement R4 also clarifies that the cold weather preparedness plans shall reflect the lowest calculated Extreme Cold Weather Temperature for the unit, even if subsequent re-calculations indicate warming temperatures.38 17. Proposed Reliability Standard EOP–012–2, Requirement R5 is substantively unchanged from the prior version of the Standard. Requirement R5 states that generator owners must train their personnel annually on the unit’s cold weather preparedness plans.39 18. Proposed Reliability Standard EOP–012–2, Requirement R6 modifies the requirement that generator owners that self-commit or are required to operate at or below a temperature of 32 at 38. at 38–39. 35 Proposed Reliability Standard EOP–012–2, Requirement R2, n.1 and Requirement R3, n.2; see also NERC Petition at 41–42. 36 Proposed Reliability Standard EOP–012–2, Requirement R4 was originally Requirement R3 in currently approved but not yet effective Reliability Standard EOP–012–1. 37 NERC Petition at 45. 38 Id. at 46 (citing proposed Reliability Standard EOP–012–2, Requirement R4, n.3, which states that generator owners shall include the lowest calculated Extreme Cold Weather Temperature for the unit, even where subsequent periodic recalculations under Requirement R1, Part 1.1 cause an increase in the Extreme Cold Weather Temperature). 39 Id. at 47. PO 00000 55241 degrees Fahrenheit and experience an outage, failure to start, or derate due to freezing at or above their Extreme Cold Weather Temperature must develop a corrective action plan to address the identified causes. Requirement R6 exempts generating units that do not self-commit or are not required to operate at or below a temperature of 32 degrees Fahrenheit, including those that may be called upon to operate to assist in mitigating emergencies during periods at or below 32 degrees Fahrenheit.40 19. Proposed Reliability Standard EOP–012–2, Requirement R7 modifies the requirement for implementing corrective action plans. Requirement R7 includes new implementation deadlines for implementing corrective action plans and clarifies the types of constraints that may preclude the implementation of one or more corrective actions.41 Specifically, Requirement R7 requires that for each corrective action plan developed pursuant to Requirements R1, R2, R3, or R6, generator owners shall include a timetable for implementing the corrective actions and complete the corrective actions in accordance with the timetables outlined in the proposed Standard.42 Under Requirement R7, generator owners are permitted to update the corrective action plan timetables, with justifications, if corrective actions change or the timetable exceeds the timelines in Requirement R7, Part 7.1. This requirement also states that the generator owner must document, in a declaration with justification, any Generator Cold Weather Constraint that precludes the generator owner from implementing the selected actions contained within the corrective action plan.43 20. Proposed Reliability Standard EOP–012–2, Requirement R8 is a new requirement that would apply to generator owners that have declared a Generator Cold Weather Constraint under Requirement R7. Specifically, this 33 Id. 34 Id. Frm 00026 Fmt 4703 Sfmt 4703 40 Id. at 48 (citing Proposed Reliability Standard EOP–012–2, Requirement R6, n.4). 41 Id. at 50. 42 Id. at 50–51 (noting that generator owners must list the actions that address existing equipment or freeze protection measures to be completed within 24 calendar months of completing development of the corrective action plan, list the actions that require new equipment or freeze protection measures, if any, to be completed within 48 calendar months of completing development of the corrective action plan, and list the updates to the cold weather preparedness plan requirement under Requirement R4 to identify the updates or additions to the Generator Cold Weather Critical Components and their freeze protection measures) (emphasis added). 43 NERC Petition at 51–60. E:\FR\FM\03JYN1.SGM 03JYN1 55242 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices khammond on DSKJM1Z7X2PROD with NOTICES requirement states that each generator owner that creates a Generator Cold Weather Constraint declaration shall review the Generator Cold Weather Constraint declaration at least every five calendar years or as needed when a change of status to the Generator Cold Weather Constraint occurs and update the operating limitations associated with capability and availability under Requirement R1, Part 1.2, if applicable.44 21. NERC requests that the Commission approve the violation risk factors and violation severity levels for proposed Reliability Standard EOP– 012–2.45 Further, NERC proposes an effective date for Reliability Standard EOP–012–2 (with the exception of Requirement R3, which would become mandatory and enforceable 12-months following the proposed Standard’s effective date) of October 1, 2024 or the first day of the first calendar quarter that is three months following regulatory approval, whichever is later.46 22. Finally, NERC requests that the Commission approve proposed Reliability Standard EOP–012–2 in an expedited manner. NERC explains that, among other things, expedited approval would provide regulatory certainty to entities seeking to comply with the proposed Reliability Standard ahead of the mandatory and enforceable date.47 II. Notice of Filing and Responsive Pleadings 23. Notice of NERC’s February 16, 2024, Petition was published in the Federal Register, 89 FR 14,479 (2024), with comments, protests, and motions to intervene due on or before March 21, 2024. 24. The Commission received one protest, one set of comments, and five sets of out of time answers. The Electric Power Supply Association (EPSA); the New England Power Generators Association, Inc. (NEPGA); Dominion Energy Services, Inc. (Dominion), Constellation Energy Generation, LLC (Constellation), and the Independent System Operators and Regional Transmission Organizations Council (the ISO/RTO Council) filed timely motions to intervene. The Transmission Access Policy Study Group (TAPS); Avangrid Renewables, LLC; and the Pennsylvania Public Utility Commission filed out of time motions to intervene. NEPGA filed timely comments. The ISO/RTO Council filed a timely protest. EPSA, TAPS, NERC, and the ISO/RTO Council filed motions for leave to answer along with answers.48 25. Commenters and protesters raised concerns and requests for clarifications for proposed Reliability Standard EOP– 012–2. The commenters range in their support for proposed Reliability Standard EOP–012–2 from requesting that the Commission approve the proposed Standard as filed 49 or approve the proposed Standard as filed with minor clarifications,50 to requesting that the Commission remand the proposed Standard to NERC with directives.51 The comments on specific matters are summarized and addressed in the determinations below. III. Determination A. Procedural Matters 26. Pursuant to Rule 214 of the Commission’s Rules of Practice and Procedure, 18 CFR 385.214 (2023), the timely, unopposed motions to intervene serve to make the entities that filed them parties to this proceeding. 27. Rule 213(a)(2) of the Commission’s Rules of Practice and Procedure, 18 CFR 385.213(a)(2) (2023), 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 TAPS, Avangrid Renewables, LLC, and the Pennsylvania Public Utility Commission’s motions for leave to file out of time motions to intervene given their interest in the proceeding and the absence of undue prejudice or delay. B. Substantive Matters 28. Pursuant to section 215(d)(2) of the FPA, we approve proposed Reliability Standard EOP–012–2 as just, reasonable, not unduly discriminatory or preferential, and in the public interest. Absent the reforms adopted in proposed Reliability Standard EOP– 012–2, the unexpected failure of generating units during extreme cold weather conditions could negatively impact the reliability of the Bulk-Power System. 29. We find that proposed Reliability Standard EOP–012–2 represents an improvement over approved Reliability Standard EOP–012–1 as the proposed Standard enhances the reliable operation of the Bulk-Power System. Specifically, the proposed Reliability Standard will improve reliability by 48 TAPS filed two answers. Answer at 1–3; 29. 50 See NEPGA Comments 1–5; EPSA Answer 1– 5; TAPS Answer at 1–2. 51 See ISO/RTO Council Protest at 1–3. 44 Id. at 62. 45 Id. at 2–3. 46 Id. at 66. 47 Id. at 70–71. VerDate Sep<11>2014 49 NERC 19:36 Jul 02, 2024 Jkt 262001 PO 00000 Frm 00027 Fmt 4703 Sfmt 4703 requiring generator owners to implement freeze protection measures, develop detailed 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 will help address many of the issues identified as contributing to generating unit failures during extreme cold weather conditions, as noted in the November 2021 Report.52 30. Nevertheless, while we find that NERC’s petition is an improvement to the currently approved Reliability Standard, we also find that there are some elements of proposed Reliability Standard EOP–012–2 that are not fully responsive to the Commission’s February 2023 Order.53 Accordingly, as discussed further below, we direct NERC pursuant to section 215(d)(5) of the FPA to address these issues. 31. Although we find that the Reliability Standard needs additional improvement, we are not persuaded that there is sufficient cause to remand proposed Standard EOP–012–2, as requested by the ISO/RTO Council.54 Proposed Reliability Standard EOP– 012–2 represents an improvement over approved Reliability Standard EOP– 012–1, and remanding the proposed Standard would allow currently approved Reliability Standard EOP– 012–1 to go into effect on October 1, 2024, despite its ambiguities and other identified issues.55 32. Below we address the following elements of proposed Reliability Standard EOP–012–2: (1) Generator Cold Weather Constraint declaration criteria; (2) the entity to receive, review, evaluate, and confirm for validity the Generator Cold Weather Constraint declarations; (3) the length of the corrective action plan implementation deadlines; (4) the corrective action plan 52 See November 2021 Report at 184–210. NERC Petition at 27–28; see also February 2023 Order, 182 FERC ¶ 61,094 at PP 1, 3, 6, 9–10, 66, 77–79, 88. 54 See ISO/RTO Council Protest at 4. 55 See, e.g., Mandatory Reliability Standards for the Bulk-Power Sys., Order No. 693, 118 FERC ¶ 61,218, at P 10; order on reh’g, Order No. 693– A, 120 FERC ¶ 61,053 (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). 53 See E:\FR\FM\03JYN1.SGM 03JYN1 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices implementation timelines for existing versus new generating units; (5) the generating unit freeze measure applicability exemptions within proposed Requirements R2, R3, and R6; (6) the winterization criteria for new versus existing generating units; (7) the annual inspections and maintenance of a generating unit’s freeze protection measures; (8) the five-year review period for declared Generator Cold Weather Constraints; and (9) cost recovery mechanisms. 1. Generator Cold Weather Constraint Declaration Criteria khammond on DSKJM1Z7X2PROD with NOTICES a. The Commission’s Directive in the February 2023 Order 33. Under Reliability Standard EOP– 012–1, a generator owner could explain in a declaration any ‘‘technical, commercial, or operational constraints’’ that preclude its ability to either implement freeze protection measures or implement corrective action plans. However, Reliability Standard EOP– 012–1 does not define ‘‘technical, commercial, or operational constraints,’’ leaving those terms open to interpretation by each generator owner. In the February 2023 Order, the Commission approved Reliability Standard EOP–012–1 but expressed concern with the uncertainties, ambiguities, and vagueness of the Standard’s descriptions of constraints, noting that, without criteria to guide the generator owners or guardrails on what constitutes a legitimate constraint, generator owners may avoid the purpose of the Standard altogether or have declarations without auditable elements. Thus, the Commission directed NERC to address the ambiguity of generator owner-defined declarations by including auditable criteria to ensure that declarations cannot be used to avoid mandatory compliance with the Reliability Standard or obligations in a corrective action plan.56 b. NERC’s Petition 34. In proposed Reliability Standard EOP–012–2, NERC proposes to replace the undefined ‘‘technical, commercial, or operational constraints’’ with the newly defined Glossary term ‘‘Generator Cold Weather Constraint.’’ The term explains that constraints are conditions precluding generator owners from implementing freeze protection measures based on one or more criteria. NERC states that: Criteria used to determine a constraint includes practices, methods, or technologies which, given the exercise 56 February 2023 Order, 182 FERC ¶ 61,094 at PP 6, 66. VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 of reasonable judgment in light of the facts known at the time the decision to declare the constraint was made: • Were not broadly implemented at generating units for comparable unit types in regions that experience similar winter climate conditions to provide reasonable assurance of efficacy; • Could not have been expected to accomplish the desired result; or • Could not have been implemented at a reasonable cost consistent with good business practices, reliability, or safety. A cost may be deemed ‘‘unreasonable’’ when implementation of selected freeze protection measure(s) are uneconomical to the extent that they would require prohibitively expensive modifications or significant expenditures on equipment with minimal remaining life.57 35. During the development of proposed Reliability Standard EOP– 012–2, NERC’s Standard Drafting Team explained that using a reasonableness standard as a benchmark for evaluating constraint declarations is appropriate given the wide range of facts and circumstances that will be relevant under the definition.58 The Standard Drafting Team added that the ‘‘reasonableness standard is typically an objective test that looks at the average decision maker’s conduct under the particular facts and circumstances present if they exercised average care, skill, and judgement.’’ 59 NERC’s Standard Drafting Team considered adding specific criteria but was of the opinion that the proposed Reliability Standard must be adaptable as facts and circumstances change and new solutions are identified and become commercially available.60 NERC’s petition states that the language used in the Generator Cold Weather Constraint definition is modeled after the concept of ‘‘good utility practice’’ and is intended to convey that the proposed Reliability Standard ‘‘would not require the best solutions, which would result in more constraints being declared, but rather acceptable solutions.’’ 61 NERC states that the term ‘‘unreasonable costs’’ is intended to refer to costprohibitive modifications or significant expenditures that could lead to premature retirement of equipment.62 Petition at 28. Ex. F, at 50–51. 59 See id., Ex. F at 1,772. 60 See id. 61 See NERC Petition at 57 (citing to the Commission’s pro forma Open Access Transmission Tariff, section 1.15). 62 Id. PO 00000 57 NERC 58 Id., Frm 00028 Fmt 4703 Sfmt 4703 55243 c. Comments 36. The ISO/RTO Council argues that the discussion of freeze protection measures in the newly defined Generator Cold Weather Constraint term creates ambiguity that provides far too much discretion to the entities required to comply with proposed Reliability Standard EOP–012–2.63 The ISO/RTO Council believes that the proposed Standard provides insufficient guidance concerning a generator owner’s exercise of discretion to interpret whether freeze protection measures are available for its equipment when determining whether a basis exists to declare a constraint. As such, the ISO/RTO Council recommends that the Commission direct NERC to revise the constraint declaration language so that it is clear that freeze protection measures are intended to include practices, methods, or technologies that would reasonably be expected to result in effective facility performance while operating at the Extreme Cold Weather Temperature.64 37. NERC, in its answer, states that its Standard Drafting Team determined that proposed Reliability Standard EOP– 012–2 should not require entities to implement technologies or solutions that had not been proven to be effective in similar climate conditions.65 TAPS members, while initially expressing concern during the development of proposed Standard2, now believe that NERC guidance will help ensure consistent application of the Generator Cold Weather Constraint declaration criteria.66 TAPS asserts that the new definition is auditable and greatly improves upon NERC’s approach in approved Reliability Standard EOP– 012–1.67 38. The ISO/RTO Council also states that the inclusion of ‘‘reasonable cost’’ in the definition of what qualifies as a potential Generator Cold Weather Constraint is subjective, unclear, and un-auditable.68 The ISO/RTO Council is concerned that this would allow generator owners to declare a constraint simply by asserting that implementing a given freeze protection measure would constitute a ‘‘ ‘prohibitively expensive modification[ ]’ or a ‘significant expenditure[ ]’ and that the affected facility has a ‘minimal remaining 63 ISO/RTO Council Protest at 13. at 15. 65 NERC Answer at 14 (noting that the Commission is only required to find that the proposed Reliability Standard, as written, is just and reasonable rather than the ‘‘best’’ option and requesting that the Commission give due weight to the expertise of the Standard Drafting Team). 66 TAPS Answer at 2–3. 67 Id. 68 ISO/RTO Council Protest at 6. 64 Id. E:\FR\FM\03JYN1.SGM 03JYN1 55244 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices khammond on DSKJM1Z7X2PROD with NOTICES life.’ ’’ 69 They state that this exception effectively injects NERC and the Regional Entities into the process of judging the reasonableness of costs and a particular generator owner’s financial situation.70 As such, the ISO/RTO Council recommends that the Commission direct NERC to remove the cost-based constraints from proposed Reliability Standard EOP–012–2.71 They state that the Commission faces a policy choice of whether to adopt exceptions to compliance based on generator owners’ assertions of excessive costs or whether to apply its FPA section 205 and 206 authority to provide avenues for generator owners to recover costs.72 39. In contrast, TAPS argues that the definition of an economic constraint is quite narrow and does not permit a balancing of costs against benefits.73 TAPS does not agree with the ISO/RTO Council that cost-based constraints should be removed from the Generator Cold Weather Constraint definition entirely since that would make the proposed Reliability Standard unreasonable and contrary to the requirements of FPA section 215(d)(2).74 TAPS argues that such removal would mandate winterization at any cost, no matter how unjustifiable.75 40. In its answer, NERC states that the proposed definition of Generator Cold Weather Constraint accounts for concerns that the requirements to operate in cold weather could ‘‘lead to fewer generators choosing to operate in cold weather due to prohibitive costs or technical inability to meet the operational capability requirements’’ of the proposed Reliability Standard.76 NERC asserts that the ISO/RTO Council is not taking into account the reliability impacts that may occur if the cost of compliance is prohibitively high and generators choose not to operate.77 On the auditability issue, NERC states that the proposed definition is auditable and that the ISO/RTO Council is conflating 69 Id. at 7 (quoting NERC’s proposed definition of the Generator Cold Weather Constraint).; see also NERC Petition, Ex. A, at 3. 70 ISO/RTO Council Protest at 7. 71 Id. at 7–8, 12 (stating that cost should be addressed by the Commission through its obligation to ensure just and reasonable rates and by the appropriate state, local, and regulatory authorities rather than being ‘‘shoehorned’’ into a Reliability Standard). 72 ISO/RTO Council Answer at 4–8. 73 TAPS Answer at 4; TAPS Second Answer at 3. 74 TAPS Answer at 5 (citing to 16 U.S.C. 824o(d)(2), which provides that ‘‘[t]he Commission may approve . . . a proposed reliability standard . . . if it determines that the standard is just, reasonable, not unduly discriminatory or preferential, and in the public interest’’). 75 Id. 76 NERC Answer at 8. 77 Id. at 9. VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 ‘‘auditability’’ and ‘‘flexibility.’’ They state that NERC and the Regional Entities ‘‘understand that they will be assessing the reasonableness of the process entities use to declare constraints’’ and will continue to monitor implementation of the proposed Reliability Standard closely.78 d. Commission Determination 41. Although NERC’s proposal to replace the existing ‘‘technical, commercial, and operational’’ constraints with the newly defined Generator Cold Weather Constraint term and associated criteria meets the Commission’s directive to develop criteria for constraint declarations, it does not meet the Commission’s directives to develop criteria that are objective, unambiguous, and auditable.79 In Reliability Standard EOP–012–1, the use of ‘‘technical, commercial and operational constraints’’ was a stand-alone phrase, and did not include any definitions or further explanation of the conditions under which such declarations could be made, causing the ambiguity concerns raised in the February 2023 Order.80 Moreover, Reliability Standard EOP– 012–1 left it up to the generator owner to interpret what it meant to have a technical, commercial, or operational constraint. By adding some criteria for the constraint declarations, we find that NERC’s proposed Generator Cold Weather Constraint declaration criteria improves upon the status quo. 42. Nevertheless, we share the ISO/ RTO Council’s concerns that the proposed Generator Cold Weather Constraint declaration criteria are also ambiguous, which may lead to inconsistent application and uncertainty. For example, the proposed definition does not provide sufficient guidance on how widely a freeze protection technology must be deployed before it will be considered a ‘‘generally implemented’’ technology. We agree with the ISO/RTO Council’s concern that this focus on general industry practice, without any way to ensure consistency in the application of that language, leaves the Commission without an objective standard that can be effectively audited. 43. In response to the ISO/RTO Council’s concern, NERC states that its Standard Drafting Team determined that proposed Reliability Standard EOP– 012–2 should not require the implementation of unproven 78 Id. at 10–11. 2023 Order, 182 FERC ¶ 61,094 at PP 79 February 6, 66. 80 See id. PP 6, 64–66. PO 00000 Frm 00029 Fmt 4703 Sfmt 4703 technologies.81 We agree. However, in its effort to provide flexibility, the proposed Reliability Standard falls short of the Commission’s directive to develop criteria that are objective, unambiguous, and auditable, as discussed further below.82 The Commission has previously expressed similar concerns regarding the vagueness and enforceability of a Reliability Standard’s language. For example, in Order No. 693 the Commission approved Reliability Standards while also expressing concern that the term ‘‘sabotage’’ was too ambiguous.83 Similarly, in Order No. 791 (approving Version 5 of the Critical Infrastructure Protection Reliability Standards), the Commission raised concerns with vague language that required entities to ‘‘identify, assess, and correct’’ deficiencies.84 The Commission determined that the ambiguities resulted in an ‘‘unacceptable amount of uncertainty’’ and directed NERC to remove the ambiguous language and develop appropriate modifications.85 In both Order Nos. 693 and 791, the Commission approved NERC’s proposed Reliability Standards as an improvement to reliability, while directing NERC to submit modifications to the Reliability Standards addressing the Commission’s concern regarding the vagueness of particular language. We conclude that a similar approach is appropriate in the instant proceeding, given the improvements offered by proposed Reliability Standard EOP– 012–2 in addressing Bulk-Power System reliability during extreme cold weather events. 44. We also find that the inclusion of the clause ‘‘reasonable cost consistent with good business practices’’ in the third criterion of the Generator Cold Weather Constraint definition does not meet the Commission’s directive to create criteria that are objective, unambiguous, and auditable.86 In its answer, NERC explains that its Standard Drafting Team was concerned about the reliability impacts that may follow from a mandate to retrofit a generating unit at any cost when many generator owners have significant discretion regarding whether and when they will participate 81 NERC Answer at 13–14. 2023 Order, 182 FERC ¶ 61,094 at PP 82 February 6, 66. 83 See Order No. 693, 118 FERC ¶ 61,218 at PP 1, 461. 84 See Order No. 791, 145 FERC ¶ 61,160 at PP 49–53, 67, 69. 85 See id.; see also Order No. 693, 118 FERC ¶ 61,218 at PP 1, 461. 86 February 2023 Order, 182 FERC ¶ 61,094 at PP 6, 66. E:\FR\FM\03JYN1.SGM 03JYN1 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices khammond on DSKJM1Z7X2PROD with NOTICES in the market. While we agree there may be a need to account for certain cases in which the cost of retrofitting may be unnecessarily burdensome, the mechanism in proposed Reliability Standard EOP–012–2 to address such cases provides a recipe for inconsistent outcomes. Although NERC argues that the use of ‘‘reasonable cost consistent with good business practices’’ is akin to the Commission’s use of ‘‘good utility practice,’’ we find such comparisons unavailing. Neither the proposed Reliability Standard itself nor the NERC Glossary of Terms defines what constitutes a ‘‘reasonable cost’’ or ‘‘good business practices.’’ Even if it did, NERC, as the ERO, is not well positioned to assess the reasonableness of a registered entity’s economic choices. Additionally, while ‘‘good utility practice’’ has been widely used in Commission-jurisdictional contracts and tariffs,87 it has not been used in the FPA section 215 context.88 45. The Commission has previously rejected similar attempts to include vaguely defined cost considerations in Reliability Standards. Specifically, in Order No. 706, the Commission directed NERC to remove references to reasonable business judgment in its Reliability Standard.89 The Commission largely based its finding on the fact that NERC’s Glossary of Terms did not define the term ‘‘reasonable business judgment’’ and the Reliability Standard itself did not suggest how the term should be interpreted.90 46. We acknowledge that there may be certain instances in which the cost of retrofitting may be unduly burdensome. To address such instances, NERC should clearly define such exceptions and present them for Commission review. For example, one approach could be for NERC to provide a limited set of clearly defined circumstances that could serve as constraints, such as an attestation 91 from a generator owner or generator operator that: (1) the generating unit is scheduled to retire within the next two years; (2) implementing freeze protection measures in accordance with the Reliability Standard would cause the generating unit to retire within two 87 See e.g., Midcontinent Indep. Sys. Operator, Inc., 165 FERC ¶ 61,016, P 49 (2018). 88 16 U.S.C. 824o. 89 See Mandatory Reliability Standards for Critical Infrastructure Protection, Order No. 706, 122 FERC ¶ 61,040, PP 137–38 (2008); order on clarification, 126 FERC ¶ 61,229; order denying clarification, 127 FERC ¶ 61,273 (2009). 90 See id. P 109. 91 As noted below, NERC shall receive, review, evaluate, and confirm for validity any Generator Cold Weather Constraint declaration in a timely manner. Infra at P 54. VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 years; or (3) they would cancel a newly scheduled generating unit that has not yet achieved commercial operation if required to comply with the freeze protection requirements of a Standard.92 Including discrete circumstances regarding what constitutes an acceptable economic constraint could provide clarity to generator owners considering constraint declarations and allow for an objective and straightforward evaluation of the constraint declaration criteria during compliance monitoring activities. 47. Accordingly, we direct NERC, pursuant to section 215(d)(5) of the FPA, to develop and submit to the Commission for approval modifications to proposed Reliability Standard EOP– 012–2 that address concerns related to the ambiguity of the newly defined Generator Cold Weather Constraint term and criteria. Specifically, we direct NERC to ensure that the Generator Cold Weather Constraint declaration criteria included within the proposed Reliability Standard are objective and sufficiently detailed so that applicable entities understand what is required of them. One approach to satisfy this directive could be to incorporate into the proposed Reliability Standard a limited and discrete list of circumstances that would qualify as acceptable constraints. We note that NERC’s technical rationale document,93 created by NERC’s Standard Drafting Team and included in NERC’s filing, includes a list of technical constraints that could serve as a starting point for a list of circumstances that would qualify as acceptable constraints. To the extent that NERC continues to believe that the extent of industry adoption for winterization technologies should be a criterion for declaring a constraint, NERC should clearly explain in its filing how it will assess the extent of such adoption in a way that provides for consistent compliance and enforcement outcomes. Alternatively, NERC could establish a pre-approval process for all Generator Cold Weather Constraint declarations. While a clearly defined list may be preferable, a pre-approval process could be established to ensure entities’ declared Generator Cold this example, generator owners or generator operators should seek cost recovery through the available cost recovery mechanisms prior to making attestations about retirement. 93 See NERC, Drafting Team Reference Manual— Version 5, at 8 (Jan. 2024), https://www.nerc.com/ pa/Stand/Resources/Documents/ Drafting%20Team%20Reference%20Manual%20_ clean_January%202024.pdf; see also NERC, Technical Rationale for Reliability Standards FAQ, at 1 (Mar. 2018), https://www.nerc.com/pa/Stand/ TechnicalRationale/ Technical%20Rationale%20FAQs_March2018.pdf. PO 00000 92 For Frm 00030 Fmt 4703 Sfmt 4703 55245 Weather Constraints are appropriate and can be supported and defended. Further, as part of the directive to develop and submit modifications to the Generator Cold Weather Constraint definition of proposed Reliability Standard EOP–012–2, we direct NERC, pursuant to section 215(d)(5) of the FPA, to remove the references to ‘‘cost,’’ ‘‘reasonable cost,’’ ‘‘unreasonable cost,’’ and ‘‘good business practices’’ and replace them with criteria that are objective, unambiguous, and auditable. NERC may propose to develop modifications that address the Commission’s concerns in an equally efficient and effective manner, however, NERC must explain how its proposal addresses the Commission’s concerns.94 2. Entity To Receive, Review, Evaluate, and Confirm for Validity the Generator Cold Weather Constraint Declarations a. The Commission’s Directive in the February 2023 Order 48. In the February 2023 Order, the Commission directed NERC to identify the entity that would receive and review the generator owners’ constraint declarations pursuant to Reliability Standard EOP–012–1, Requirements R1 and R7, and to describe how that entity would confirm that the generator owners complied with the objective criteria.95 b. NERC Petition 49. In response to the Commission’s directive, NERC proposes new Requirement R8, Part 8.2. NERC proposes to require that any generating unit cold weather operating limitations due to declared constraints be provided to the balancing authority, transmission operator, or reliability coordinator via data specifications to the generator owners through other Reliability Standard requirements.96 In its petition, NERC states that its Standard Drafting Team determined that having the generator owner communicate the practical impacts of declaring a constraint to the entities that are responsible for grid planning and 94 See Order No. 693, 118 FERC ¶ 61,218 at P 186. 2023 Order, 182 FERC ¶ 61,094 at PP 95 February 6, 66. 96 See NERC Petition at 63. The transmission operators and balancing authorities, in accordance with Reliability Standard TOP–003–5 (Operational Reliability Data), must obtain the generating unit(s) minimum design temperature, the historical operating temperature, or the current cold weather performance temperature determined by an engineering analysis. See Reliability Standard TOP– 003–5, Requirement R1, Part 1.3.2. and Requirement R2, Parts 2.3.2.1, 2.3.2.2., and 2.3.2.3. Likewise, reliability coordinators must obtain this information per Reliability Standard IRO–010–4 (Reliability Coordinator Data Specification). E:\FR\FM\03JYN1.SGM 03JYN1 55246 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices reliability would be the best way to address the reliability concerns contained in the Commission’s directive.97 50. NERC explains that it and the Regional Entities would be responsible for assessing entity compliance with the Generator Cold Weather Constraint declaration provisions via an audit or other compliance monitoring method.98 NERC also states that it and the Regional Entities are preparing a ‘‘strategy for performing robust compliance monitoring and enforcement of the currently effective and approved generator cold weather Reliability Standards.’’ 99 Further, NERC points to the annual data request and analysis that it asserts would allow the Commission to understand the efficacy of, and monitor the ongoing risk posed by, technical, commercial, or operational constraint provisions.100 51. NERC states that it and the Regional Entities understand that they will be assessing the reasonableness of the process generator owners use to declare Generator Cold Weather Constraints.101 NERC notes that it will take steps to ensure that its reviews are ‘‘conducted in a consistent manner across the ERO Enterprise.’’ 102 khammond on DSKJM1Z7X2PROD with NOTICES c. Commission Determination 52. We find that proposed Reliability Standard EOP–012–2 does not identify an entity to receive the Generator Cold Weather Constraint declarations, the entity responsible for timely review of the generator owners’ constraint declarations, or the entity responsible for ensuring that the declarations meet the objective criteria of the proposed Standard. Although we agree with NERC that declared constraints can be provided to the balancing authority, transmission operator, or reliability coordinator via data specifications under existing Reliability Standards, this does not address the Commission’s directive that an entity review and confirm that generator owners complied with the constraint criteria. 53. NERC states that a review of the Generator Cold Weather Constraint declarations will occur during compliance activities, and that it and the Regional Entities are developing a compliance monitoring strategy for the cold weather Reliability Standards.103 We conclude, however, that NERC’s 97 See NERC Petition at 63 (citing February 2023 Order, 182 FERC ¶ 61,094 at P 66). 98 Id. at 63–64. 99 Id. at 69. 100 Id. 101 Id. at 10–11. 102 Id. 103 See id. at 63–64. VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 proposal is not an equally efficient and effective means to address the Commission’s directive and underlying concern. First, the NERC Rules of Procedure contain no obligation to periodically audit generator owners. Only a handful of generator owners are audited each year, and those audits do not assess all Reliability Standards and all requirements. Moreover, given the significant reliability risk evidenced by the failure of generating units during recent extreme winter weather events, we continue to believe that an enhanced level of oversight remains necessary to ensure that Generator Cold Weather Constraints are only declared when warranted. While generator owners’ responses to NERC’s annual data request regarding the Generator Cold Weather Constraint declarations are useful for a wide-area event analysis or in forecasting future trends,104 NERC’s annual data request will only provide a limited insight into the specific facts and circumstances around a Generator Cold Weather Constraint declaration. For example, while the annual data request is expected to indicate whether the generator owner has declared a constraint for a generating unit along with the associated rationale(s) for each declaration, it does not collect any supporting documentation necessary to justify the generator owners’ declared constraints. As a result, we are not persuaded that NERC’s annual data request constitutes an adequate substitute for an appropriate entity contemporaneously reviewing and confirming whether a generator owner has complied with the objective constraint criteria set out in proposed Reliability Standard EOP–012–2.105 54. Accordingly, we again direct NERC, pursuant to section 215(d)(5) of the FPA, to modify proposed Reliability Standard so that NERC receives, reviews, evaluates, and confirms for validity the Generator Cold Weather Constraint declarations in a timely manner. We also direct NERC to include in its compliance filing, a plan to timely review such declarations to verify compliance with proposed Reliability Standard EOP–012–2 and its successors or obligations in a corrective action plan and take corrective action where necessary. For example, modifying Standard to require the generator owners to provide declarations (or changes to the declarations) to NERC within 45 days. It is up to NERC 104 See generally N. Am. Elec. Reliability Corp., Compliance Filing, Docket No. RD23–1–000 (Feb. 16, 2024). 105 February 2023 Order, 182 FERC ¶ 61,094 at PP 6. PO 00000 Frm 00031 Fmt 4703 Sfmt 4703 whether it would like to delegate this task to the relevant Regional Entities. NERC may propose to develop modifications that address the Commission’s concerns in an equally efficient and effective manner, however, NERC must explain how its proposal addresses the Commission’s concerns.106 3. The Length of Corrective Action Plan Implementation Deadlines a. The Commission’s Directives in the February 2023 Order 55. The Commission directed NERC to develop three modifications pertaining to the corrective action plan deadlines set forth in Reliability Standard EOP– 012–1. First, the Commission directed NERC to shorten the 60-month timeframe for developing corrective action plans for existing units.107 While the Commission gave NERC discretion to determine what the effective date should be shortened to, it also emphasized that ‘‘industry has been aware of and alerted to the need to prepare their generating units for cold weather since at least 2011’’ and that NERC should consider the ‘‘amount of time that industry has already had to implement freeze protection measures.’’ 108 Second, the Commission directed NERC to revise Reliability Standard EOP–012–1 to include deadlines for completing the corrective actions in the plans.109 Specifically, the Commission was concerned that the lack of a deadline or maximum duration for completing the corrective actions could allow identified issues to remain unresolved for an indefinite period.110 Third, the Commission directed NERC to modify the Reliability Standard EOP– 012–1, Requirement R2, implementation plan for generating units with a commercial operation date prior to October 1, 2027 to require a staggered implementation of freeze protection measures for existing units in a generator owner’s fleet with an effective date of less than 60 months from regulatory approval.111 b. NERC’s Petition 56. Proposed Reliability Standard EOP–012–2 requires generator owners to 106 See Order No. 693, 118 FERC ¶ 61,218 at P 186. 107 See February 2023 Order, 182 FERC ¶ 61,094 at PP 10, 24. Sixty months was determined based on approved Reliability Standard EOP–012–1 becoming effective 18 months after the effective date of applicable regulatory approvals combined with the 42-month compliance date for Reliability Standard EOP–012–1 Requirement R2. 108 Id. P 10. 109 Id. PP 9–10, 79, 88. 110 Id. PP 9–10, 77–79. 111 Id. PP 10, 38. E:\FR\FM\03JYN1.SGM 03JYN1 khammond on DSKJM1Z7X2PROD with NOTICES Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices develop, within 12-months after the effective date of the Reliability Standard, a corrective action plan for their existing units to add new, or modify existing, freeze protection measures.112 57. NERC states that proposed Reliability Standard EOP–012–2 does not include the staggered timeline for the development of corrective action plans that are required for existing units.113 NERC shortened the timeline to develop the corrective action plan for all existing units to 12-months. According to NERC’s proposal, the generator owners are then allowed an additional 24 months to implement the corrective actions to modify existing equipment or existing freeze protection measures (Requirement R7.1.1) and 48 months for implementing corrective actions requiring new equipment or new freeze protection measures (Requirement R7.1.2) listed in the developed corrective action plans under proposed Reliability Standard EOP– 012–2.114 58. In its petition, NERC explains that it considered the Commission’s directive to stagger implementation across a fleet of generating units, but determined that it would address reliability risks quicker by establishing a shorter period for full implementation of proposed Reliability Standard EOP– 012–2 combined with ‘‘aggressive timeframes’’ for implementing corrective action plan measures.115 NERC also states that it is likely that some natural staggering would occur as entities seek to implement measures across a fleet of generating units. NERC’s Standard Drafting Team determined that leaving entities with flexibility in meeting timetables for implementing corrective actions would be ‘‘appropriate in the interest of advancing cold weather reliability more quickly and more efficiently.’’ 116 59. NERC also added a provision permitting a generator owner to update a corrective action plan implementation timetable, with justification, if it exceeds the 24- and 48-month timeframes in Requirement R7 of the proposed Reliability Standard. 60. Proposed Reliability Standard EOP–012–2, Requirement R2 allows generator owners to have corrective action plans for new generating units that are similar to corrective actions plans allowed for existing generating 112 See NERC Petition at 38–39; see also id. at Ex. B at 3. 113 See id. at 67. 114 Id. at 50–51. 115 Id. at 67. 116 Id. at 68. VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 units. NERC’s petition states that ‘‘[t]his revision would drive ongoing reliability improvements, through Corrective Action Plans, if a new generator does not have sufficient freeze protection measures’’ at the time of commercial operation, in accordance with proposed Requirement R2.117 61. Proposed Reliability Standard EOP–012–2, Requirement R7 would require generator owners to ‘‘include timetables for implementing corrective actions that are within specified timeframes and to implement corrective actions in accordance with those timetables.’’ 118 The timetables would require the completion of corrective actions within 48 months of the development of corrective action plans for new equipment or freeze protection measures.119 Proposed Reliability Standard EOP–012–2, Requirement R2 also establishes a compliance date of October 1, 2027.120 c. Comments 62. The ISO/RTO Council is concerned that even NERC’s shorter 24month period of implementation is still too long and ‘‘do[es] not appropriately reflect the urgency of winterizing generating units.’’ 121 According to the ISO/RTO Council, this is especially true for those generating units that experience a Generator Cold Weather Reliability Event versus the like units that are identified for corresponding corrective action plans, which may be at different geographic locations with different weather/climate patterns and will have different levels of risk of experiencing future freeze related issues. The ISO/RTO Council also believes that proposed Reliability Standard EOP–012–2 does not sufficiently incentivize generator owners to use best efforts to promptly implement all immediate and near-term winterization actions before the upcoming winter season.122 The ISO/ RTO Council recommends that the Commission direct NERC to revise proposed Reliability Standard EOP– 012–2 to include a requirement that each generator owner document its best efforts to promptly implement all immediate and near-term actions prior to the next upcoming winter season to 117 Id. at 43 (giving the example of a new generating unit being too far along in its design process to meet the more stringent requirements of proposed Requirement R3 [R2] when it begins commercial operation on or soon after October 1, 2027). 118 NERC Petition at 51. 119 Id. 120 Id. at 39–40. 121 ISO/RTO Council Protest at 19. 122 Id. at 25; see also ISO/RTO Council Answer at 9–10. PO 00000 Frm 00032 Fmt 4703 Sfmt 4703 55247 winterize each generating unit to operate at its calculated Extreme Cold Weather Temperature.123 63. NERC replied to the ISO/RTO Council’s concern by stating that the Standard Drafting Team balanced the need for prompt implementation of freeze protection measures with ‘‘factors influencing the ability to implement those measures, particularly across a fleet of units.’’ 124 In doing so, NERC notes that its Standard Drafting Team decided on an approach that would allow generator owners less time to implement protections with existing equipment or freeze protection measures and more time to implement protections requiring new equipment or freeze protection measures.125 64. Additionally, the ISO/RTO Council objects to the extension provision, believing that NERC and the Regional Entities will only evaluate timeline exceedance for appropriateness and proper documentation after the fact, either as part of ongoing data collections or during compliance efforts.126 The ISO/RTO Council recommends that the Commission direct NERC to revise Requirement R7, Part 7.3, to require generator owners to apply for and receive NERC or Regional Entity approval to extend corrective action plan implementation timeframes beyond the timeframes established by proposed Reliability Standard EOP– 012–2.127 In response, NERC disagrees and states that it ‘‘has identified no reliability need that would justify the administrative burdens of such a process in this case.’’ 128 d. Commission Determination 65. The Commission directed NERC to shorten the 60-month deadline of Requirement R2 of approved Reliability Standard EOP–012–1 to develop corrective action plans for existing units.129 By giving generator owners 12months after the effective date of proposed Reliability Standard EOP– 012–2 to develop corrective action plans to meet their Extreme Cold Weather Temperature to add new or modify existing freeze protection measures to their existing units, we find that NERC has met this directive through modified Requirements R3 and R7 of proposed Reliability Standard EOP–012–2. 123 ISO/RTO Council Protest at 26; see also ISO/ RTO Council Answer at 10. 124 NERC Answer at 19–20. 125 Id. at 20. 126 ISO/RTO Council Protest at 20–22. 127 Id. at 22. 128 NERC Answer at 20–21. 129 February 2023 Order, 182 FERC ¶ 61,094 at P 88. E:\FR\FM\03JYN1.SGM 03JYN1 khammond on DSKJM1Z7X2PROD with NOTICES 55248 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices 66. Additionally, we are persuaded that NERC’s proposed deadlines for implementing corrective action plans under Requirement R7 of proposed Reliability Standard EOP–012–2 meet the Commission’s directive aimed at establishing corrective action plan implementation deadlines and will provide a significant level of risk reduction compared to the status quo. NERC met the Commission’s directive by incorporating different corrective action plan completion timelines for existing and new generating units (24and 48-months following corrective action plan development, as noted in Requirement R7 of the proposed Reliability Standard) which will result in staggered corrective action plan implementation in stages. We find that this equates to a staggered or phased approach. 67. Nevertheless, we are concerned that the length of NERC’s proposed 24and 48-month deadlines for implementing corrective actions after a generating unit’s failure is too long 130 and do not meet the Commission’s directive, which sought to substantially accelerate reliability risk mitigation. Specifically, under NERC’s proposal, resources that are impacted by a Generator Cold Weather Reliability Event (e.g., freezing issue resulting in a forced outage or derate) are allowed approximately 30 or 54 months to mitigate the cause of the cold weather failure, depending on whether existing or new equipment or freeze protection measures are needed to remedy the freezing issue. Both Winter Storms Uri and Elliott demonstrated that unplanned cold weather-related generation outages jeopardize BulkPower System reliability. As was seen during those events, a generating unit forced outage or derate caused by a freezing issue is a known reliability risk. For those generating units that fail to operate during an extreme cold weather reliability event, their risks must be mitigated quicker than NERC proposes regardless of whether existing or new freeze protection measures are needed on the units that experience failure. 68. Accordingly, we direct NERC, pursuant to section 215(d)(5) of the FPA, to develop and submit modifications to Requirement R7 of proposed Reliability Standard EOP– 012–2 to require shorter deadlines to implement corrective actions for existing or new equipment or the freeze protection measures for those generating units that experience a Generator Cold Weather Reliability Event. Based on 130 Requirement R7 of proposed Reliability Standard EOP–012–2. VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 compliance with Requirements R2 and R3, those generating units should have already had appropriate freeze protection measures implemented to be capable of operating at the generating units’ respective Extreme Cold Weather Temperature. Therefore, we find that a shorter timeframe to implement corrective actions that address existing or new equipment or freeze protection measures is appropriate. For example, to satisfy this directive, NERC could require generator owners to implement corrective actions prior to the next winter season for generating units that experience a Cold Weather Reliability Event and to complete freeze protection measures on similar equipment on all of its fleet within 24 months of becoming aware of the freeze issue. For corrective action plans that involve larger and more complicated implementations, NERC could incorporate a staggered 48month corrective action plan implementation deadline.131 69. In addition, we agree with the ISO/RTO Council that without the appropriate oversight of generator owner’s proposed updates to the corrective action plan implementation deadlines, the established maximum implementation deadlines in proposed Reliability Standard EOP–012–2, Requirement R7 have less meaning and allow a known reliability risk to remain on the Bulk-Power System for a longer time. In light of this reliability risk, we find that any updates to corrective action plan timeframes beyond the maximum implementation timeframes under Requirement R7 must be reviewed and approved by NERC. 70. Therefore, we direct NERC, pursuant to section 215(d)(5) of the FPA, to develop and submit modifications to Requirement R7 of proposed Reliability Standard EOP– 012–2 to ensure that any extension of a corrective action plan implementation deadline beyond the maximum implementation timeframe required by the proposed Reliability Standard is preapproved by NERC. This approach is consistent with prior Commission action in Order No. 851 where the Commission directed NERC to require pre-approval for extensions beyond the timelines required in the Reliability Standard.132 In Order No. 851, the 131 NERC may propose modifications that address the Commission’s concerns in an equally efficient and effective manner; however, NERC must explain how its proposal addresses the Commission’s concerns. See Order No. 693, 118 FERC ¶ 61,218 at P 186. 132 See, e.g., Geomagnetic Disturbance Reliability Standard; Reliability Standard for Transmission Sys, Planned Performance for Geomagnetic Disturbance Events, Order No. 851, 165 FERC PO 00000 Frm 00033 Fmt 4703 Sfmt 4703 Commission explained that although case-by-case extension determinations may be more uncertain or have associated burdens, the more compelling imperative is that automatic extensions have the potential for abuse by unduly delaying mitigation, and would lead to delayed visibility for NERC.133 71. NERC asserts that, during the first three years that proposed Reliability Standard EOP–012–2 is mandatory and effective, generator owners that are well into their construction phase should have additional time (compared to a project at a lesser stage of construction) to complete corrective action plans for elements already designed.134 NERC explains that extra time is needed because NERC, in its technical rational, states that ‘‘there needs to be allowances made for units that are in the development process, and for which the design phase may have already commenced.’’ 135 We are persuaded by NERC’s rationale that in this scenario the generator owner may need additional time. However, we are concerned that the proposed Reliability Standard, as currently written, does not make a clear demarcation between projects well into their construction phase and those at a lesser phase of construction; therefore, it could inadvertently be interpreted to allow a generator owner to have 48-months beyond its commercial operation date to implement Requirement R2 corrective action plans, even if the generator owner has not yet begun to construct its generating unit. 72. We thus find that generators that are commercially operational after October 1, 2027, should have freeze protection measures either designed into their generating systems, or, if a corrective action plan is needed, then it should be completed by the time that such generating units go into commercial operation. Accordingly, we direct NERC, pursuant to section 215(d)(5) of the FPA, to develop and submit modifications to Requirement R7 of proposed Reliability Standard EOP– ¶ 61,124, at P 54 (2018) (directing NERC to revise Reliability Standard TPL–007–2 (Transmission System Planned Performance for Geomagnetic Disturbance Events) to include a process through which corrective action plan extensions are considered on a case-by-case basis. NERC later revised Reliability Standard TPL–007–2, Requirement R7.4; N. Am. Elec. Reliability Corp., Docket No. RD20–3–000, at 1 (Mar. 19, 2020) (a delegated order approving Reliability Standard TPL–007–4, which requires entities to seek approval from the ERO of any extensions of time for the completion of corrective action plan items). 133 Order No. 851, 165 FERC ¶ 61,124 at P 55. 134 NERC Petition, Ex. C, at 9. 135 Id. E:\FR\FM\03JYN1.SGM 03JYN1 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices 012–2 to clarify that any Requirement R2 corrective action plans must be completed prior to the generating unit’s commercial operation date. 4. Corrective Action Plan Implementation Timeline Ambiguities a. NERC Petition 73. Proposed Reliability Standard EOP–012–2, Requirement R7 states that a 24-month timeline applies to corrective actions that address existing equipment or freeze protection measures and a 48-month timeline applies to corrective actions that require new equipment or freeze protection measures.136 NERC’s Standard Drafting Team stated that generator owners would be able to use ‘‘appropriate judgment’’ to determine the appropriate timeline for corrective action in accordance with Requirement R7 of proposed Reliability Standard EOP– 012–2.137 b. Comments khammond on DSKJM1Z7X2PROD with NOTICES 74. The ISO/RTO Council requests clarification on which corrective action implementation timeline applies to which corrective actions under Requirement R7 of proposed Reliability Standard EOP–012–2.138 The ISO/RTO Council argues that some corrective actions might involve the application of new freeze protection measures on existing equipment or the extension of existing freeze protection measures to newly installed equipment, thereby implicating both timelines. Thus, it is unclear to them which timeline applies in such situations.139 The ISO/RTO Council recommends that the Commission direct NERC to revise proposed Reliability Standard EOP– 012–2 to apply the shorter of the two timelines to corrective actions that do not require the installation of new equipment.140 75. The ISO/RTO Council states that while the use of professional judgment is a common method for navigating ambiguities, the fact that professional judgment exists is not a valid basis for approving an ambiguous Reliability Standard.141 In response, NERC states that the Commission should not direct NERC to clarify the periods allotted for the implementation of freeze protection measures because its strategy is consistent with Order No. 672.142 136 Id., Ex. A at 8 (emphasis added). Ex. F at 190. 138 ISO/RTO Council Protest at 23. 139 Id. at 22–23. 140 Id. 141 Id. at 24. 142 NERC Answer at 5 (citing to discussion in Order No. 672 that requires the Commission, when 137 Id., VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 c. Commission Determination 76. We believe that proposed Reliability Standard EOP–012–2, Requirement R7’s corrective action plan implementation deadlines have remaining ambiguities that need to be addressed. As noted above, the Commission has previously expressed similar concerns regarding the vagueness and enforceability of Reliability Standards language.143 Specifically, we agree with the concerns raised by the ISO/RTO Council that Requirement R7 of proposed Reliability Standard EOP–012–2 does not provide clear direction as to the required corrective action plan implementation timeline that applies to certain generator owners. For example, it is unclear how the corrective action plan implementation timeline would apply if a generator owner had combinations of both existing and new equipment for freeze protection measures. Accordingly, we direct NERC, pursuant to section 215(d)(5) of the FPA, to develop and submit modifications to Requirement R7 of proposed Reliability Standard EOP–012–2 to address these ambiguities by expanding on Requirement R7.1.1 and 7.1.2 to make it clear which corrective action plan implementation deadline applies to which generator owner. 5. Proposed Reliability Standard EOP– 012–2, Requirements R2, R3, and R6, Footnotes 1, 2, and 4 a. NERC’s Petition 77. Proposed Reliability Standard EOP–012–2, Requirements R2, R3, and R6 contain new and identical footnotes 1, 2, and 4, respectively.144 These footnotes indicate that generating units that do not self-commit or are not required to operate at or below a temperature of 32 degrees Fahrenheit but ‘‘may be called upon to operate in order to assist in the mitigation of [bulk electric system] Emergencies, Capacity Emergencies, or Energy Emergencies determining whether a proposed Standard is just and reasonable, to consider the timetable for the implementation of new requirements, including the urgency of the need for implementation with the reasonableness of time for entities that must comply); Order No. 672, 114 FERC ¶ 61,104 at P 328. 143 As further discussed above, in both Order No. 693 and Order No. 791, the Commission approved NERC’s proposed Reliability Standards as an improvement to the reliable operation of the BulkPower System, while also directing NERC to submit modifications to the Reliability Standards to address the Commission’s concern regarding the ambiguities contained in particular language. See Order No. 693, 118 FERC ¶ 61,218 at PP 1, 461; see also Order No. 791, 145 FERC¶ 61,160 at PP 49–53, 67, 69. 144 See NERC Petition at 38–39, 48. PO 00000 Frm 00034 Fmt 4703 Sfmt 4703 55249 during periods at or below a temperature of 32 degrees Fahrenheit (zero degrees Celsius) are exempt’’ from Requirements R2, R3, and R6.145 b. Comments 78. The ISO/RTO Council raises concerns regarding the limitations on applicability created by footnotes 1, 2, and 4 in Requirements R2, R3, and R6 of proposed Reliability Standard EOP– 012–2.146 The ISO/RTO Council believes that this exemption should be limited to truly seasonal generating units that will not be called upon to operate during freezing conditions, even during bulk electric system emergencies.147 Thus, the ISO/RTO Council recommends that the Commission direct NERC to either remove the footnotes 1, 2, and 4 or revise Requirements R2, R3, and R6 by replacing the phrase ‘‘self-commits or is required to operate’’ with ‘‘that may be committed to operate.’’ 148 79. In response, NERC states that ‘‘the appropriateness of this limited exemption is a settled matter.’’ 149 NERC notes that this exemption was included in Reliability Standard EOP–012–1 and the Commission already approved that Reliability Standard with this delineation.150 NERC reiterates that the exemptions, as written, are intended to incentivize generating units that do not normally operate in freezing conditions to participate in mitigating a bulk electric system emergency.151 80. TAPS agrees with NERC and states that these exemptions are appropriate and that NERC’s applicability section modifications are in line with the Commission’s February 2023 Order.152 TAPS states that, under NERC’s proposed modifications to Reliability Standard EOP–012–2, the system operator should have already requested and received operational limitation data from each bulk electric system generating unit in its footprint; thus, there is no additional step for an ISO or RTO to take to identify which 145 Id. 146 ISO/RTO Council Protest at 15–17. at 16–17. 148 Id. at 18 (stating that this would allow truly seasonal generating units that are ineligible to be committed to operate during freezing conditions to be exempt from Requirements R2, R3, and R6 of proposed Reliability Standard EOP–012–2). 149 NERC Answer at 16–17 (stating that the ISO/ RTO Council’s concern is an ‘‘untimely attack on an issue that was previously decided by the Commission’’ when it approved EOP–012–1); see also February 2023 Order, 182 FERC ¶ 61,094 at P 60. 150 NERC Answer at 16. 151 Id. 152 TAPS Answer at 9–12 (citing to the February 2023 Order, 182 FERC ¶ 61,094 at P 58). 147 Id. E:\FR\FM\03JYN1.SGM 03JYN1 55250 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices generating units can operate under particular conditions.153 c. Commission Determination 81. While we appreciate the ISO/RTO Council’s concern, we agree with NERC and TAPS that the exemptions set forth in Requirements R2, R3, and R6, footnotes 1, 2, and 4, respectively, are appropriate and that NERC’s applicability section modifications are in line with the Commission’s February 2023 Order. We agree with NERC’s aim of exempting generating units that do not self-commit or are not required to operate at or below a temperature of 32 degrees Fahrenheit and are not persuaded that a directive is warranted at this time to further narrow this exemption. We expect that, as part of its compliance monitoring activities, NERC will continue to monitor the application of the exemption to ensure its application is consistent with the generating units’ actual obligations pursuant to relevant tariffs, contracts, regulations, or other binding requirements. 6. Different Winterization Criteria for New and Existing Generating Units a. NERC’s Petition 82. Proposed Reliability Standard EOP–012–2, Requirements R2 and R3 carry forward the cold weather operational capability requirements for new and existing bulk electric system units from approved Reliability Standard EOP–012–1, Requirements R1 and R2, respectively.154 Proposed Requirement R2 applies to generating units that are in commercial operation on or after October 1, 2027, and requires them to implement freeze protection measures to protect Generator Cold Weather Critical Components that provide the capability to operate at the unit’s Extreme Cold Weather Temperature with sustained concurrent 20 mph wind speed for a period of not less than 12 continuous hours or the maximum operational duration for intermittent energy resources if less than 12 continuous hours.155 Proposed Requirement R3 applies to generating units that are in commercial operation prior to October 1, 2027, and requires them to implement freeze protection khammond on DSKJM1Z7X2PROD with NOTICES 153 Id. at 11–12. Petition at 37. 155 Id. at 38 (noting that if they are unable to do so, then the generator owner must develop a corrective action plan to add new or modify existing or previously planned freeze protection measures to provide the capability to operate at the unit’s Extreme Cold Weather Temperature with sustained concurrent 20 mph wind speed for a period of not less than 12 continuous hours or the maximum operational duration for intermittent energy resources if less than 12 continuous hours). 154 NERC VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 measures to protect Generator Cold Weather Critical Components that provide the capability to operate at the unit’s Extreme Cold Weather Temperature.156 During the drafting process, NERC’s Standard Drafting Team responded to comments by stating that having separate requirements for new and existing units is appropriate given that some generating units would be difficult to retrofit and that existing units can provide reliable performance at temperatures above their Extreme Cold Weather Temperature.157 b. Comments 83. The ISO/RTO Council objects to having different winterization criteria for new and existing generating units, noting that new units have to meet more stringent requirements. The ISO/RTO Council states that, while some older generating units may not be able to perform at Requirement R2’s more stringent standard, many generating units that enter commercial operation before October 1, 2027, should be able to do so.158 84. The ISO/RTO Council believes that while some generating units would be difficult to retrofit in some cases, the Winter Storms Uri and Elliott Inquiry reports cautioned against setting a lower winterization standard for an entire category of generating units.159 The ISO/ RTO Council recommends that the Commission direct NERC to remove Requirement R3 and revise Requirement R2 to apply to all generating units, regardless of when they achieved commercial operation.160 85. In its answer, NERC asserts that the ISO/RTO Council’s argument on grandfathering provisions is an untimely attack on a Commissionapproved issue.161 c. Commission’s Determination 86. We agree with NERC that it is appropriate to have separate requirements for new and existing generating units within proposed Reliability Standard EOP–012–2, Requirements R2 and R3, respectively.162 NERC’s Standard Drafting Team discussed applying the same requirements to existing units and new units but determined that these 156 Id. at 39 (stating that if they are unable to do so, then the generator owner must develop a corrective action plan to add new or modify existing freeze protection measures to provide the capability to operate at the unit’s Extreme Cold Weather Temperature). 157 Id., Ex. F at 103, 291. 158 ISO/RTO Council Protest at 26–27. 159 Id. at 27–28. 160 Id. at 28. 161 See NERC Answer at 23. 162 See NERC Petition, Ex. F at 450, 452. PO 00000 Frm 00035 Fmt 4703 Sfmt 4703 requirements would be difficult to retrofit and may not be justified ‘‘provided that existing units can prove reliable performance at temperatures above their’’ Extreme Cold Weather Temperature.163 We also note that the Commission approved NERC’s proposal to have different winterization criteria for new and existing generating units in the February 2023 Order and no concerns with having different winterization criteria were raised in that proceeding.164 Nevertheless, we strongly encourage existing generating units that are capable of implementing the more detailed freeze protection measures and corrective actions in line with proposed Reliability Standard EOP–012–2, Requirement R2 to do so. 7. Annual Inspection and Maintenance of Generating Units Freeze Protection Measures a. NERC’s Petition 87. Proposed Reliability Standard EOP–012–2, Requirement R4, Part 4.5 requires the annual inspection and maintenance of generating unit freeze protection measures.165 b. Comments 88. The ISO/RTO Council expresses concern that without any reference to timing other than a requirement for ‘‘annual’’ inspections and maintenance, this provision will not result in timely preparations for upcoming cold weather operations.166 The ISO/RTO Council recommends that the Commission direct NERC to revise proposed Reliability Standard EOP–012–2 to require inspections and maintenance of all generating units to occur on at least an annual basis and always within three months of the upcoming winter season.167 89. NERC agrees that it is a good practice to inspect and maintain freeze protection measures before an upcoming winter season.168 NERC disagrees, however, that the proposed Reliability Standard needs to require ‘‘in detail the timing of the required annual inspections for it to be a just and reasonable standard.’’ Moreover, NERC states, the Commission approved 163 Id. 164 See February 2023 Order, 182 FERC ¶ 61,094 at PP 1–2, 47. 165 See NERC Petition at 45; see also NERC Petition, Ex. A at 7. 166 ISO/RTO Council Protest at 31; see also ISO/ RTO Council Answer at 11. 167 ISO/RTO Council Protest at 31–32; see also ISO/RTO Council Answer at 11. 168 NERC Answer at 26. E:\FR\FM\03JYN1.SGM 03JYN1 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices b. Comments Reliability Standard EOP–012–1 without such specificity.169 c. Commission Determination 90. We find that it is premature to address the ISO/RTO Council’s recommendation that the Commission direct NERC to revise the proposed Reliability Standard to require inspections and maintenance of all generating units to occur on at least an annual basis and always within three months of the upcoming winter season.170 We believe that requiring the annual inspection and maintenance of generating unit freeze protection measures is adequate at this time. By requiring the annual inspection and maintenance of generator freeze protection measures, proposed Reliability Standard EOP–012–2 (and its predecessor, approved Reliability Standard EOP–012–1) represent a significant improvement upon the previously effective set of Reliability Standards, which did not include such requirements. Although we agree with both the ISO/RTO Council and NERC that it is a good practice to inspect and maintain freeze protection measures before an upcoming winter season, we are not persuaded that such additional specificity is necessary at this time. NERC has committed to monitoring the implementation of this new Standard and, in doing so, can determine whether there are outage patterns or other data that suggest the need for additional specificity.171 8. The Five-Year Review Period for Declared Generator Cold Weather Constraints a. NERC’s Petition khammond on DSKJM1Z7X2PROD with NOTICES 91. Proposed Reliability Standard EOP–012–2, Requirement R8.1 states that each generator owner that declares a Generator Cold Weather Constraint shall review the declaration at least every five calendar years or as needed when a change of status to the Generator Cold Weather Constraint occurs.172 169 Id. (stating that it could consider the ISO/RTO Council’s proposal at a later date if the implementation of proposed Reliability Standard EOP–012–2, Requirement R4 suggests that more specificity would advance reliability). 170 ISO/RTO Council Protest at 31–32; see also ISO/RTO Council Answer at 11. 171 See, e.g., FERC, NERC, and Regional Entity Staff, Inquiry into Bulk-Power System Operations During December 2022 Winter Storm Elliott, at 132 (Oct. 2023), https://www.ferc.gov/news-events/ news/ferc-nerc-release-final-report-lessons-winterstorm-elliott (October 2023 Report) (recommendation 1(b)). 172 NERC’s Petition at 62. VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 92. The ISO/RTO Council expresses concern that once a generator owner declares a Generator Cold Weather Constraint, proposed Reliability Standard EOP–012–2 only requires the generator owner to review that constraint every five years,173 which lowers the bar for bulk electric system winterization and reliability by delaying the identification and adoption of new freeze protection technologies.174 The ISO/RTO Council states that a five-year review period tips the scales in favor of slow installation and application of new technologies and ‘‘would result in years elapsing’’ between a new freeze protection technology becoming viable and a generator owner evaluating that technology as part of its routine review of a constraint.175 As such, the ISO/RTO Council recommends that the Commission direct NERC to revise proposed Reliability Standard EOP– 012–2 to require that constraint declaration reviews be performed annually instead of every five years. 93. NERC disagrees with the ISO/RTO Council’s arguments and states that many commenters in the standard development process expressed concern that annual reviews would be ‘‘an administrative burden [with] no reliability benefit.’’ 176 NERC also states that five-year reviews were selected because the technology and price of freeze protections are unlikely to change significantly over the course of a year.177 c. Commission Determination 94. We agree with the ISO/RTO Council that the proposed five-year review period for the declared Generator Cold Weather Constraints in Requirement R8.1 could delay the identification and adoption of new freeze protection measures and does not represent the current pace of technological advancements. We acknowledge that a more frequent review does impose some additional administrative burden to the generator owner to review the technological advancements that hindered its ability to winterize; nonetheless, a lengthy period between a Generator Cold Weather Constraint declaration review by the generator owner offers little incentive to timely adopt new freeze ISO/RTO Council Protest at 29; see also NERC Petition, Ex. A at 9. 174 ISO/RTO Council Protest at 29. 175 Id. at 30. 176 NERC Answer at 25 (referencing the development history of the proposed Standard and citing commenter concerns). 177 Id. PO 00000 173 See Frm 00036 Fmt 4703 Sfmt 4703 55251 protection technologies. Accordingly, we direct NERC, pursuant to section 215(d)(5) of the FPA, to develop and submit modifications to Requirement R8, Part 8.1 of proposed Reliability Standard EOP–012–2 to implement more frequent reviews of Generator Cold Weather Constraint declarations to verify that the declaration remains valid. NERC may propose to develop modifications that address the Commission’s concerns in an equally efficient and effective manner, however, NERC must explain how its proposal addresses the Commission’s concerns.178 9. Cost Recovery Mechanisms a. Comments 95. While NEPGA recognizes that the Commission found cost recovery to be outside the scope in connection with its February 2023 Order, it asks the Commission to recognize the near-term need for ISO–NE, generator owners, and other stakeholders to work together to ensure that cost recovery opportunities exit under the ISO–NE tariff.179 NEPGA argues that the ISO–NE tariff provisions do not appear to allow an existing capacity resource to reflect capital costs, such as those that may be incurred to modify or add freeze protection equipment.180 EPSA’s Answer supports NEPGA’s comments about cost recovery and asks the Commission to assess all markets within its jurisdiction to determine whether there are sufficient vehicles for recovery of winterization costs.181 96. The ISO/RTO Council acknowledges that cost recovery is ‘‘critically important’’ but argues that costs should not be included as part of a Reliability Standard. Instead, the ISO/ RTO Council contends that cost recovery should be addressed through a rate proceeding overseen by the Commission or another applicable regulatory authority (e.g., state or provincial).182 The ISO/RTO Council requests that the Commission ‘‘indicate its intention to allow for cost recovery’’ for the extreme cold weather Reliability Standards and direct its Office of Energy Market Regulation to survey those markets within its jurisdiction to determine whether there are sufficient 178 See Order No. 693, 118 FERC ¶ 61,218 at P 186. 179 NEPGA Comments at 2 (citing February 2023 Order, 182 FERC ¶ 61,094 at P 83). 180 Id. (citing Cogentrix Energy Power Mgmt., LLC v. FERC, 24 F.4th 677, 683–4 (D.C. Cir. 2022) to express concern that costs incurred prior to the effective date of an associated rate recovery mechanism would be unrecoverable). 181 EPSA Answer at 3–5. 182 ISO/RTO Council Answer at 4–7. E:\FR\FM\03JYN1.SGM 03JYN1 55252 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices section 3507(d) of the Paperwork Reduction Act of 1995.188 OMB’s regulations require approval of certain information collection requirements imposed by agency rules.189 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. 100. 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. 101. The EOP Standards are currently located in the FERC–725S (OMB Control No. 1902–0270) collection.190 In Docket No. RD24–5–000, the Commission proposes to replace the current OMB approved Reliability Standard EOP– 012–1 with proposed Reliability vehicles for cost recovery of winterization measures.183 97. NERC asserts that while it would support market-related actions that advance the goal of generator reliability, it has no opinion with respect to the specific cost recovery declaration and survey proposed by the ISO/RTO Council.184 NERC states that it defers to the Commission’s expertise on cost recovery. b. Commission Determination 98. We find the question of whether existing market mechanisms provide an opportunity to recover the prudently incurred costs of compliance with the proposed Reliability Standard to be outside the scope of the instant proceeding, consistent with our finding in the February 2023 Order.185 To the extent that there are concerns about whether existing rates or tariffs allow for the recovery of all prudently incurred costs necessary to comply with mandatory Reliability Standards as required by FPA section 219,186 such questions are more appropriately addressed in proceedings pursuant to FPA sections 205 or 206.187 IV. Information Collection Statement 99. The information collection requirements contained in this Order are subject to review by the Office of Management and Budget (OMB) under Standard EOP–012–2 (Table 1). Proposed Reliability Standard EOP– 012–2 has eight requirements, seven of which have been carried over and modified from the already approved Reliability Standard EOP–012–1 (Requirements R1–R7) and one of which is new (Requirement R8). 102. 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 Reliability Standard EOP–012–2. 103. The number of respondents below are based on an estimate of the NERC compliance registry for generator owners and generator operators. Proposed Reliability Standard EOP– 012–2 applies to generator owners and generator operators. The Commission based its paperwork burden estimates on the NERC compliance registry as of April 16, 2024. According to the registry for US unique entities, there are 1,210 generator owners. The estimates in the tables below are based on the change in burden from the Reliability Standards approved in this order.191 The Commission based the burden estimates in the tables below on staff experience, knowledge, and expertise. Public Reporting Burden: The estimated costs and burden for the revisions in Docket No. RD24–5–000 are shown in the table below. TABLE 1—PROPOSED CHANGES DUE TO FINAL RULE IN DOCKET NO. RD24–5–000 FOR EOP–012–2 Number of annual responses per entity Type and number of entity Reliability standard & requirement I (1) Total number of responses (2) I I (1) * (2) = (3) Average number of burden hours per response 192 Total burden hours (4) (3) * (4) = (5) FERC–725S One Time Estimate—Years 1 and 2 EOP–012–2 EOP–012–2 .............................. Sub-Total for EOP–012–2 (one-time). 1,210 (GO) ..... 1 1,210 5 hrs., $373.15 .............. 6,050 hrs., $451,511.5. ........................ .................... 1,210 5 hrs., $373.15 .............. 6,050 hrs., $451,511.5. khammond on DSKJM1Z7X2PROD with NOTICES Ongoing Estimate—Year 3 ongoing EOP–012–2 EOP–012–2 .............................. 1,210 (GO) ..... 1 1,210 2 hrs.,193 $149.26 .......... 2,420 hrs., $180,604.6. Sub-Total for EOP–012–2 (ongoing). Sub-Total of ongoing burden averaged over three years. ........................ .................... 1,210 2 hrs., $149.26 .............. 2,420 hrs., $180,604.6. ........................ .................... 404 ........................................ 807 hrs., $60,226.41. 183 Id. at 4. Answer at 12. 185 See February 2023 Order, 182 FERC ¶ 61,094 at P 83. 186 16 U.S.C. 824s(b)(4)(A). 187 Id. sec. 824d; see also id. sec. 824e. 184 NERC VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 U.S.C. 3507(d). CFR 1320 (2023). 190 The FERC–725S collection includes the EOP family of Reliability Standards: EOP–004–4, EOP 005–3, EOP–006–3, EOP–008–2, EOP–010–1, EOP– 011–4, and EOP–012–2. PO 00000 188 44 189 5 Frm 00037 Fmt 4703 Sfmt 4703 191 The overall burden associated with Reliability Standard EOP–012 will be the sum of the burden (responses) from Reliability Standard EOP–012–1 (under RD23–1–000) and Reliability Standard EOP– 012–2 (under RD24–5–000). E:\FR\FM\03JYN1.SGM 03JYN1 55253 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices TABLE 1—PROPOSED CHANGES DUE TO FINAL RULE IN DOCKET NO. RD24–5–000 FOR EOP–012–2—Continued Reliability standard & requirement Proposed Total Burden Estimate of EOP–012–2. Type and number of entity Number of annual responses per entity Total number of responses Average number of burden hours per response 192 Total burden hours (1) (2) (1) * (2) = (3) (4) (3) * (4) = (5) ........................ .................... 1,614 ........................................ 6,857 hrs., $511,737.91. Changes to FERC 725S by RD24–5–000 FERC–725S modification Current inventory (hours) Current inventory (responses) Total change due to RD24–5–000 Addition of EOP–012–2 ........... ........................ .................... +6,857 hrs., +1,614 responses. khammond on DSKJM1Z7X2PROD with NOTICES Titles: FERC–725S, Mandatory Reliability Standards for the Bulk-Power System; EOP Reliability Standards. Action: Revisions 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: Annually. Necessity of the Information: Reliability Standard EOP–012–2 (Extreme Cold Weather Preparedness and Operations) is 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 Reliability Standard ensures 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 the revised Reliability Standards and made a determination that its action is necessary to implement section 215 of the FPA. The Commission has assured itself, by means of its internal review, that there is specific, objective support for the 192 The estimated hourly cost (salary plus benefits) is a combination based on the Bureau of Labor Statistics (BLS), as of 2024, for seventy five percent of the average of an Electrical Engineer (17– 2071)—$79.31 and mechanical engineers (17– 2141)—$89.86. ($79.31 + $89.86)/2 = 84.585 × .75 = 63.439 ($63.44-rounded) ($63.44/hour) and twenty-five percent of an Information and Record Clerk (43–4199) $44.74 × .25% = 11.185 ($11.19 rounded) ($11.19/hour), for a total ($63.44 + $11.19 = $74.63/hour). 193 A fraction of generator owners would be required to perform the task on an ongoing basis, and the hours represent the whole body of generator owners. VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 burden estimates associated with the information requirements. a. Description of the Revision to FERC–725S: The FERC–725S (OMB Control No. 1902–0270) is an existing information collection that contains the requirements for the EOP–012–1 Reliability Standard. As described in the Docket No. RD24–1–000 above, the Reliability Standard (EOP–012–1) is proposed to be retired and replaced by EOP–012–2. 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: Jean Sonneman, email: DataClearance@ferc.gov, phone: (202) 502–6362]. 105. Comments concerning the information collections and requirements approved for retirement in this order and the associated burden estimates, should be sent to the Commission (identified by Docket No. RD24–5–000), using the following methods: Electronic filing through https://www.ferc.gov is preferred. Electronic Filing should be filed in acceptable native applications and print-to-PDF, but not in scanned or picture format. For those unable to file electronically, comments may be filed by USPS mail or by hand (including courier) delivery: Mail via U.S. Postal Service Only: Addressed to: Federal Energy Regulatory Commission, Secretary of the Commission, 888 First Street NE, Washington, DC 20426. Hand (including courier) delivery: Deliver to: Federal Energy Regulatory Commission, 12225 Wilkins Avenue, Rockville, MD 20852. V. Environmental Analysis 106. The Commission is required to prepare an Environmental Assessment or an Environmental Impact Statement PO 00000 Frm 00038 Fmt 4703 Sfmt 4703 for any action that may have a significant adverse effect on the human environment.194 The Commission has categorically excluded certain actions from this requirement as not having a significant effect on the human environment. Included in the exclusion are rules that are clarifying, corrective, or procedural or that do not substantially change the effect of the regulations being amended.195 The actions directed herein fall within this categorical exclusion in the Commission’s regulations. VI. Document Availability 107. 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). 108. 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. 109. 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: 194 Reguls. Implementing the Nat’l Env’t Pol’y Act, Order No. 486, FERC Stats. & Regs. ¶ 30,783 (1987) (cross-referenced at 41 FERC ¶ 61,284). 195 18 CFR 380.4(a)(2)(ii) (2023). E:\FR\FM\03JYN1.SGM 03JYN1 55254 Federal Register / Vol. 89, No. 128 / Wednesday, July 3, 2024 / Notices khammond on DSKJM1Z7X2PROD with NOTICES (A) Proposed Reliability Standard EOP–012–2, the associated violation risk factors and violation severity levels, the implementation plan, the newly defined terms Fixed Fuel Supply Component and Generator Cold Weather Constraint, the revised defined terms Generator Cold Weather Critical Component and Generator Cold Weather Reliability Event, and the retirement of Reliability Standard EOP–012–1 immediately prior to the effective date of proposed Reliability Standard EOP– 012–2, are hereby approved, as discussed in the body of this order. (B) NERC’s proposed implementation date for Reliability Standard EOP–011– 4, as well as the proposed retirement of Reliability Standards EOP–011–2 and EOP–011–3 immediately prior to the effective date of proposed Reliability Standard EOP–012–2, are hereby approved, as discussed in the body of this order. (C) NERC is hereby directed to develop and submit, within nine months of the date of issuance of this order, modifications to proposed Reliability Standard EOP–012–2 to address the Commission’s concerns, including but not limited to, the Generator Cold Weather Constraint criteria definition, modifying the proposed Standard so that NERC reviews, receives, evaluates, and confirms for validity each generator owner’s constraint declarations against the developed criteria, shortening and clarifying the corrective action plan implementation deadlines outlined in Requirement R7 of proposed Reliability Standard EOP–012–2, ensuring that the any extension of a corrective action plan implementation deadline beyond the maximum implementation timeframe required by the proposed Standard is pre-approved by NERC, and implementing a more frequent review of the Generator Cold Weather Constraint declarations in accordance with Requirement R8.1 of proposed Reliability Standard EOP–021–2, as discussed in the body of this order. By the Commission. Commissioner Rosner is not participating. Issued: June 27, 2024. Debbie-Anne A. Reese, Acting Secretary. [FR Doc. 2024–14668 Filed 7–2–24; 8:45 am] BILLING CODE 6717–01–P VerDate Sep<11>2014 19:36 Jul 02, 2024 Jkt 262001 DEPARTMENT OF ENERGY Federal Energy Regulatory Commission [Project No. 1994–008] Heber Light & Power Company; Notice of Intent To File License Application, Filing of Pre-Application Document, and Approving Use of the Traditional Licensing Process a. Type of Filing: Notice of Intent to File License Application and Request to Use the Traditional Licensing Process (TLP). b. Project No.: 1994–008. c. Dated Filed: April 30, 2024. d. Submitted By: Heber Light & Power Company (Heber L&P). e. Name of Project: Snake Creek Hydroelectric Project. f. Location: On Snake Creek about 2 miles northwest of Midway City, in Wasatch County, Utah. The project occupies 8.15 acres of Forest Service land administered by the UintaWasatch-Cache National Forest. g. Filed Pursuant to: 18 CFR 5.3 of the Commission’s regulations. h. Applicant Contact: Jason Norlen, General Manager, Heber Light & Power Company, 31 S 100 W, Heber City, Utah 84032; (435) 654–2913; email: jnorlen@ heberpower.com. i. FERC Contact: Khatoon Melick at (202) 502–8433 or email at khatoon.melick@ferc.gov. j. Heber L&P filed its request to use the TLP on April 30, 2024, and provided public notice of its request on May 22, 2024. In a letter dated June 27, 2024, the Acting Director of the Division of Hydropower Licensing approved Heber L&P’s request to use the Traditional Licensing Process. k. With this notice, we are initiating informal consultation with the U.S. Fish and Wildlife Service under section 7 of the Endangered Species Act and the joint agency regulations thereunder at 50 CFR part 402; and NOAA Fisheries under section 305(b) of the MagnusonStevens Fishery Conservation and Management Act and implementing regulations at 50 CFR 600.920. We are also initiating consultation with the Utah State Historic Preservation Officer, as required by section 106, National Historic Preservation Act, and the implementing regulations of the Advisory Council on Historic Preservation at 36 CFR 800.2. l. Heber L&P filed a Pre-Application Document (PAD; including a proposed process plan and schedule) with the Commission, pursuant to 18 CFR 5.6 of the Commission’s regulations. m. A copy of the PAD may be viewed on the Commission’s website (https:// PO 00000 Frm 00039 Fmt 4703 Sfmt 4703 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. For assistance, contact FERC Online Support at FERCOnlineSupport@ferc.gov, (866) 208–3676 (toll free), or (202) 502–8659 (TTY). You may 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. The applicant states its unequivocal intent to submit an application for a subsequent license for Project No. 1994. Pursuant to 18 CFR 16.20 each application for a subsequent license and any competing license applications must be filed with the Commission at least 24 months prior to the expiration of the existing license. All applications for license for this project must be filed by April 30, 2027. o. The Commission’s Office of Public Participation (OPP) supports meaningful public engagement and participation in Commission proceedings. OPP can help members of the public, including landowners, environmental justice communities, Tribal members and others, access publicly available information and navigate Commission processes. For public inquiries and assistance with making filings such as interventions, comments, or requests for rehearing, the public is encouraged to contact OPP at (202) 502–6595 or OPP@ ferc.gov. Dated: June 27, 2024. Debbie-Anne A. Reese, Acting Secretary. [FR Doc. 2024–14670 Filed 7–2–24; 8:45 am] BILLING CODE 6717–01–P DEPARTMENT OF ENERGY Federal Energy Regulatory Commission Combined Notice of Filings #1 Take notice that the Commission received the following electric rate filings: Docket Numbers: ER24–1869–000; ER24–1870–000; ER24–1871–000; ER24–1873–000; ER24–1874–000; ER24–1875–000; ER24–1876–000. Applicants: ORNI 36 LLC, Heber Geothermal Company LLC, Mammoth Three LLC, Ormesa LLC, ORNI 18 LLC, USG Nevada LLC, VESI Pomona Energy Storage, Inc. Description: Supplement to 04/30/ 2024, VESI Pomona Energy Storage, Inc. E:\FR\FM\03JYN1.SGM 03JYN1

Agencies

[Federal Register Volume 89, Number 128 (Wednesday, July 3, 2024)]
[Notices]
[Pages 55239-55254]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-14668]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket Nos. RD24-5-000; RD24-1-000]


North American Electric Reliability Corporation; Order Approving 
Extreme Cold Weather Reliability Standard EOP-012-2 and Directing 
Modification

    1. On February 16, 2024, the North American Electric Reliability 
Corporation (NERC), the Commission-certified Electric Reliability 
Organization (ERO), submitted a petition seeking approval of proposed 
Reliability Standard EOP-012-2 (Extreme Cold Weather Preparedness and 
Operations). As discussed in this order, we approve proposed 
Reliability Standard EOP-012-2, its associated violation risk factors 
and violation severity levels, NERC's proposed implementation plan, the 
newly defined terms Fixed Fuel Supply Component and Generator Cold 
Weather Constraint, the revised defined terms Generator Cold Weather 
Critical Component and Generator Cold Weather Reliability Event, and 
the retirement of Reliability Standard EOP-012-1 immediately prior to 
the effective date of proposed Reliability Standard EOP-012-2.\1\ We 
also approve NERC's proposed implementation date for Reliability 
Standard EOP-011-4 and the proposed retirement of Reliability Standards 
EOP-011-2 and EOP-011-3 immediately prior to the effective date of 
proposed Reliability Standard EOP-012-2.\2\
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    \1\ 16 U.S.C. 824o(d)(2).
    \2\ Id.
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    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.'' \3\ When extreme cold weather events such as 
Winter Storms Uri or Elliott occur, the Bulk-Power System cannot 
operate reliably without adequate generation. Proposed Reliability 
Standard EOP-012-2 improves upon the approved, but not yet effective, 
Reliability Standard EOP-012-1 by clarifying the requirements for 
generator cold weather preparedness and by making other improvements 
consistent with the Commission's directives in its February 2023 Order 
to help ensure that more generation is available during extreme cold 
weather.\4\ Accordingly, we find that proposed Reliability Standard 
EOP-012-2 is just, reasonable, not unduly discriminatory or 
preferential, and in the public interest.
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    \3\ 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).
    \4\ See, e.g., N. Am. Elec. Reliability Corp., 182 FERC ] 
61,094, PP 3-11 (2023) (February 2023 Order); reh'g denied, 183 FERC 
] 62,034, order on reh'g, 183 FERC ] 61,222 (2023).
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    3. Nevertheless, we find that proposed Reliability Standard EOP-
012-2 requires improvement to address certain concerns, as discussed 
further below. Therefore, pursuant to section 215(d)(5) of the Federal 
Power Act (FPA),\5\ we direct NERC to:
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    \5\ 16 U.S.C. 824o(d)(5).
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    (1) develop and submit modifications to proposed Reliability 
Standard EOP-012-2 to address concerns related to the ambiguity of the 
newly defined term Generator Cold Weather Constraint to ensure that the 
Generator Cold Weather Constraint declaration criteria included within 
the proposed Standard are objective and sufficiently detailed so that 
applicable entities understand what is required of them and to remove 
all references to ``reasonable cost,'' ``unreasonable cost,'' ``cost,'' 
and ``good business practices'' and replace them with objective, 
unambiguous, and auditable terms;
    (2) develop and submit modifications to proposed Reliability 
Standard EOP-012-2 for NERC to receive, review, evaluate, and confirm 
the validity of each Generator Cold Weather Constraint invoked by a 
generator owner, in a timely fashion, to ensure that such declaration 
cannot be used to avoid mandatory compliance with the proposed 
Reliability Standard or obligations in a corrective action plan;
    (3) develop and submit modifications to proposed Reliability 
Standard EOP-012-2 to shorten and clarify the corrective action plan 
implementation timelines and deadlines in Requirement R7, as further 
directed below;
    (4) develop and submit modifications to Requirement R7 of proposed 
Reliability Standard EOP-012-2 to ensure that any extension of a 
corrective action plan implementation deadline beyond the maximum 
implementation timeframe required by the Standard is pre-approved by 
NERC and to ensure that the generator owner informs relevant registered 
entities of operating limitations in extreme cold weather during the 
period of the extension; and
    (5) develop and submit modifications to Requirement R8, part 8.1 of 
proposed Reliability Standard EOP-012-2 to implement more frequent 
reviews of Generator Cold Weather Constraint declarations to verify 
that the constraint declaration remains valid.
    4. The Commission has repeatedly expressed an urgency in completing 
cold weather Reliability Standards and having them implemented in a 
timely manner to address the risks presented by cold weather events on 
the reliability of the Bulk-Power System.\6\ Further, we note that NERC 
submitted the current filing in response to Commission directives to 
improve the cold weather Reliability Standards, and the five core 
directives to NERC in this order are not new issues, but rather 
targeted modifications necessary to fully address issues identified in 
the Commission's prior February 2023 Order. Accordingly, we direct NERC 
to make the above modifications and submit the revised Reliability 
Standard within nine months of the date of issuance of this order.\7\
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    \6\ See e.g., N. Am. Elec. Reliability Corp., 183 FERC ] 62,034 
at P 10 (emphasizing that industry has been aware of and alerted to 
the need to prepare generating units for cold weather since at least 
2011 and that in considering an appropriate implementation period 
for Reliability Standard EOP-012-1, NERC should consider how much 
time industry has already had to implement freeze protection 
measures).
    \7\ 18 CFR 39.6(g) (2023).
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I. Background

A. Section 215 and Mandatory Reliability Standards

    5. 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.\8\ 
Reliability

[[Page 55240]]

Standards may be enforced by the ERO, subject to Commission oversight, 
or by the Commission independently.\9\ Pursuant to section 215 of the 
FPA, the Commission established a process to select and certify an 
ERO,\10\ and subsequently certified NERC.\11\
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    \8\ 16 U.S.C. 824o(c).
    \9\ Id. sec. 824o(e).
    \10\ 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); see also 18 CFR 
39.4(b) (2023).
    \11\ 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

    6. On February 16, 2021, Commission, NERC, and Regional Entity 
staff initiated a joint inquiry into the circumstances surrounding a 
February 2021 cold weather reliability event then affecting Texas and 
the South-Central United States. In November 2021, Commission staff 
issued a report regarding the event, which found that the 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.\12\ The November 2021 Report made 28 recommendations 
including, inter alia, enhancements to the Reliability Standards to 
improve extreme cold weather operations, preparedness, and 
coordination.\13\
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    \12\ See November 2021 Report at 9.
    \13\ Id. at 184-212 (sub-recommendations 1a through 1j).
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    7. 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 report regarding a 2018 cold weather event.\14\ 
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).\15\ 
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.\16\ 
Reliability Standard EOP-011-2 requires generator owners to have 
generating unit cold weather preparedness plans.\17\
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    \14\ FERC and NERC Staff, The South Central United States Cold 
Weather Bulk Electric System Event of January 17, 2018, at 89 (Jul. 
2019), https://www.ferc.gov/sites/default/files/2020-07/SouthCentralUnitedStatesColdWeatherBulkElectricSystemEventofJanuary17-2018.pdf.
    \15\ See generally N. Am. Elec. Reliability Corp., 176 FERC ] 
61,119 (2021).
    \16\ Id.
    \17\ Id.
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    8. On October 28, 2022, NERC filed a petition seeking approval of 
Reliability Standards EOP-011-3 (Emergency Operations) and EOP-012-1 
(Extreme Cold Weather Preparedness and Operations), their 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 Reliability 
Standard EOP-011-2.\18\ On February 16, 2023, the Commission approved 
Reliability Standards EOP-011-3 and EOP-012-1, directed NERC to develop 
and submit modifications to Reliability Standard EOP-012-1 and to 
submit a plan on how NERC will collect and assess data surrounding the 
implementation of Reliability Standard EOP-012-1, and deferred the 
retirement of Reliability Standard EOP-011-2.\19\
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    \18\ NERC 2022 Petition at 1-2.
    \19\ See February 2023 Order, 182 FERC ] 61,094 at PP 3-11.
---------------------------------------------------------------------------

    9. On October 30, 2023, NERC filed a petition seeking approval of 
Reliability Standards EOP-011-4 (Emergency Operations) and TOP-002-5 
(Operations Planning), their associated violation risk factors and 
violation severity levels, NERC's proposed implementation plan, and the 
retirement of Reliability Standards EOP-011-2 and TOP-002-4. On 
February 15, 2024, the Commission approved Reliability Standards EOP-
011-3 and TOP-002-5 and again deferred the retirement of Reliability 
Standard EOP-011-2.\20\
---------------------------------------------------------------------------

    \20\ See id. PP 1-2.
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C. NERC's Petition and Proposed Reliability Standard EOP-012-2

    10. On February 16, 2024, in response to the Commission's February 
2023 Order, NERC filed a petition seeking approval of proposed 
Reliability Standard EOP-012-2,\21\ its associated violation risk 
factors and violation severity levels, two newly defined terms (Fixed 
Fuel Supply Component and Generator Cold Weather Constraint), two 
revised terms (Generator Cold Weather Critical Component and Generator 
Cold Weather Reliability Event), NERC's proposed implementation plan, 
and the retirement of currently approved Reliability Standard EOP-012-
1.\22\ NERC explains that proposed Reliability Standard EOP-012-2 
improves upon the approved, but not yet effective, generator cold 
weather preparation Reliability Standard EOP-012-1 and is consistent 
with the Commission's directives from the February 2023 Order.\23\ NERC 
states that proposed Reliability Standard EOP-012-2 clarifies 
applicability of the Standard's requirements for generator cold weather 
preparedness, would further define the circumstances under which a 
generator owner may declare that constraints preclude it from 
implementing one or more corrective actions to address freezing issues, 
and shortens the implementation timeline so that cold weather 
reliability risks would be addressed sooner.\24\
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    \21\ The proposed Reliability Standard EOP-012-2 is not attached 
to this order. The proposed Reliability Standard is available on the 
Commission's eLibrary document retrieval system in Docket No. RD24-
5-000 and on the NERC website, www.nerc.com.
    \22\ NERC Petition at 1-4.
    \23\ Id. at 2.
    \24\ Id.
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    11. NERC states that the purpose of proposed Reliability Standard 
EOP-012-2 is unchanged from that of approved Reliability Standard EOP-
012-1, which is to ensure that each generator owner develops and 
implements plans to alleviate the reliability impacts of extreme cold 
weather on its generating units.\25\ NERC also notes that proposed 
Reliability Standard EOP-012-2 completes NERC's two-part plan to 
address recommendations from the November 2021 Report by including 
revisions to address parts of Key Recommendations 1a, 1b, 1c, and 
1d.\26\ NERC states that the proposed Reliability Standard contains new 
and revised requirements to advance the reliability of the Bulk-Power 
System by requiring generator owners to (1) review their generator cold 
weather data periodically, (2) include any identified start up issues 
in their generator cold weather data provided to reliability entities, 
and (3) consider the impacts of freezing precipitation and wind speed 
in identifying generator cold weather data.\27\
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    \25\ Id. at 29.
    \26\ See id. at 25-26, 35, 49-50 (citing the November 2021 
Report at 184-86).
    \27\ Id. at 23.
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    12. Proposed Reliability Standard EOP-012-2 has eight requirements, 
seven of which have been carried over and modified from approved 
Reliability Standard EOP-012-1 (Requirements R1-R7) and one of which is 
new (Requirement R8). Proposed Reliability Standard EOP-012-2 applies 
to

[[Page 55241]]

generator owners and generator operators that own or operate bulk 
electric system generating units.\28\
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    \28\ NERC Petition at 22-23.
---------------------------------------------------------------------------

    13. Proposed Reliability Standard EOP-012-2, Requirement R1 
modifies the Requirements for each generator owner to calculate the 
Extreme Cold Weather Temperature for each of its applicable generating 
units and to re-calculate that temperature at least once every five 
calendar years.\29\ Where a periodic re-calculation results in a lower 
Extreme Cold Weather Temperature for the generating unit, the generator 
owner must update its cold weather preparedness plan within six months 
and, if necessary, develop a corrective action plan to implement 
measures at the applicable unit to provide the capability to operate at 
that new, lower temperature. Proposed Reliability Standard EOP-012-2, 
Requirement R1, Part 1.2, also maintains Requirement R3.1 to identify 
generating unit cold weather data, including operating limitations in 
cold weather and minimum operating temperatures, from approved 
Reliability Standard EOP-012-1, Requirement R3, Part 3.5.\30\
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    \29\ Requirement R1 under proposed Reliability Standard EOP-012-
2 modifies existing Requirement R3, Part 3.1 and Requirement R4 
under currently approved but not yet effective Reliability Standard 
EOP-012-1.
    \30\ NERC Petition at 33-37.
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    14. Proposed Reliability Standard EOP-012-2, Requirements R2 and R3 
clarify the cold weather operational capability requirements for new 
and existing bulk electric system generating units.\31\ Under proposed 
Reliability Standard EOP-012-2, Requirement R2, generator owners would 
be required to implement freeze protection measures at applicable bulk 
electric system generating units to provide the capability to operate 
at the Extreme Cold Weather Temperature with sustained, concurrent 20 
mph wind speed for the unit.\32\ Specifically, Requirement R2 requires 
generating units with a commercial operation date on or after October 
1, 2027, to be capable of operating at the unit's Extreme Cold Weather 
Temperature for a continuous 12-hour period or at the maximum 
operational duration for intermittent energy resources if less than 12 
continuous hours. If a generating unit is unable to do either then it 
must develop a corrective action plan to add new or modify existing or 
previously planned freeze protection measures to provide the capability 
to operate at the unit's Extreme Cold Weather Temperature with a 
sustained, concurrent 20 mph wind speed.\33\
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    \31\ Requirements R2 and R3 under proposed Reliability Standard 
EOP-012-2 were originally Requirements R1 and R2, respectively, 
under currently approved but not yet effective Reliability Standard 
EOP-012-1.
    \32\ NERC Petition at 37.
    \33\ Id. at 38.
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    15. Similar to Requirement R2, but without the wind and duration 
criteria, Requirement R3 requires either that existing generating 
units, (i.e., those in commercial operation prior to October 1, 2027) 
be capable of operating at the unit's Extreme Cold Weather Temperature 
or that the generator owner develops a corrective action plan to 
address the unit's inability to continuously operate successfully.\34\ 
Requirements R2 and R3 exempt generating units that do not self-commit 
or are not required to operate at or below a temperature of 32 degrees 
Fahrenheit, including those that may be called upon to operate to 
assist in mitigating emergencies during periods at or below 32 degrees 
Fahrenheit.\35\
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    \34\ Id. at 38-39.
    \35\ Proposed Reliability Standard EOP-012-2, Requirement R2, 
n.1 and Requirement R3, n.2; see also NERC Petition at 41-42.
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    16. Proposed Reliability Standard EOP-012-2, Requirement R4,\36\ 
modifies the requirement for generator owners to implement and maintain 
cold weather preparedness plans.\37\ Under Requirement R4, generator 
owners would include in their cold weather preparedness plans the 
information determined in accordance with proposed Reliability Standard 
EOP-012-2, Requirement R1. Requirement R4 also clarifies that the cold 
weather preparedness plans shall reflect the lowest calculated Extreme 
Cold Weather Temperature for the unit, even if subsequent re-
calculations indicate warming temperatures.\38\
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    \36\ Proposed Reliability Standard EOP-012-2, Requirement R4 was 
originally Requirement R3 in currently approved but not yet 
effective Reliability Standard EOP-012-1.
    \37\ NERC Petition at 45.
    \38\ Id. at 46 (citing proposed Reliability Standard EOP-012-2, 
Requirement R4, n.3, which states that generator owners shall 
include the lowest calculated Extreme Cold Weather Temperature for 
the unit, even where subsequent periodic re-calculations under 
Requirement R1, Part 1.1 cause an increase in the Extreme Cold 
Weather Temperature).
---------------------------------------------------------------------------

    17. Proposed Reliability Standard EOP-012-2, Requirement R5 is 
substantively unchanged from the prior version of the Standard. 
Requirement R5 states that generator owners must train their personnel 
annually on the unit's cold weather preparedness plans.\39\
---------------------------------------------------------------------------

    \39\ Id. at 47.
---------------------------------------------------------------------------

    18. Proposed Reliability Standard EOP-012-2, Requirement R6 
modifies the requirement that generator owners that self-commit or are 
required to operate at or below a temperature of 32 degrees Fahrenheit 
and experience an outage, failure to start, or derate due to freezing 
at or above their Extreme Cold Weather Temperature must develop a 
corrective action plan to address the identified causes. Requirement R6 
exempts generating units that do not self-commit or are not required to 
operate at or below a temperature of 32 degrees Fahrenheit, including 
those that may be called upon to operate to assist in mitigating 
emergencies during periods at or below 32 degrees Fahrenheit.\40\
---------------------------------------------------------------------------

    \40\ Id. at 48 (citing Proposed Reliability Standard EOP-012-2, 
Requirement R6, n.4).
---------------------------------------------------------------------------

    19. Proposed Reliability Standard EOP-012-2, Requirement R7 
modifies the requirement for implementing corrective action plans. 
Requirement R7 includes new implementation deadlines for implementing 
corrective action plans and clarifies the types of constraints that may 
preclude the implementation of one or more corrective actions.\41\ 
Specifically, Requirement R7 requires that for each corrective action 
plan developed pursuant to Requirements R1, R2, R3, or R6, generator 
owners shall include a timetable for implementing the corrective 
actions and complete the corrective actions in accordance with the 
timetables outlined in the proposed Standard.\42\ Under Requirement R7, 
generator owners are permitted to update the corrective action plan 
timetables, with justifications, if corrective actions change or the 
timetable exceeds the timelines in Requirement R7, Part 7.1. This 
requirement also states that the generator owner must document, in a 
declaration with justification, any Generator Cold Weather Constraint 
that precludes the generator owner from implementing the selected 
actions contained within the corrective action plan.\43\
---------------------------------------------------------------------------

    \41\ Id. at 50.
    \42\ Id. at 50-51 (noting that generator owners must list the 
actions that address existing equipment or freeze protection 
measures to be completed within 24 calendar months of completing 
development of the corrective action plan, list the actions that 
require new equipment or freeze protection measures, if any, to be 
completed within 48 calendar months of completing development of the 
corrective action plan, and list the updates to the cold weather 
preparedness plan requirement under Requirement R4 to identify the 
updates or additions to the Generator Cold Weather Critical 
Components and their freeze protection measures) (emphasis added).
    \43\ NERC Petition at 51-60.
---------------------------------------------------------------------------

    20. Proposed Reliability Standard EOP-012-2, Requirement R8 is a 
new requirement that would apply to generator owners that have declared 
a Generator Cold Weather Constraint under Requirement R7. Specifically, 
this

[[Page 55242]]

requirement states that each generator owner that creates a Generator 
Cold Weather Constraint declaration shall review the Generator Cold 
Weather Constraint declaration at least every five calendar years or as 
needed when a change of status to the Generator Cold Weather Constraint 
occurs and update the operating limitations associated with capability 
and availability under Requirement R1, Part 1.2, if applicable.\44\
---------------------------------------------------------------------------

    \44\ Id. at 62.
---------------------------------------------------------------------------

    21. NERC requests that the Commission approve the violation risk 
factors and violation severity levels for proposed Reliability Standard 
EOP-012-2.\45\ Further, NERC proposes an effective date for Reliability 
Standard EOP-012-2 (with the exception of Requirement R3, which would 
become mandatory and enforceable 12-months following the proposed 
Standard's effective date) of October 1, 2024 or the first day of the 
first calendar quarter that is three months following regulatory 
approval, whichever is later.\46\
---------------------------------------------------------------------------

    \45\ Id. at 2-3.
    \46\ Id. at 66.
---------------------------------------------------------------------------

    22. Finally, NERC requests that the Commission approve proposed 
Reliability Standard EOP-012-2 in an expedited manner. NERC explains 
that, among other things, expedited approval would provide regulatory 
certainty to entities seeking to comply with the proposed Reliability 
Standard ahead of the mandatory and enforceable date.\47\
---------------------------------------------------------------------------

    \47\ Id. at 70-71.
---------------------------------------------------------------------------

II. Notice of Filing and Responsive Pleadings

    23. Notice of NERC's February 16, 2024, Petition was published in 
the Federal Register, 89 FR 14,479 (2024), with comments, protests, and 
motions to intervene due on or before March 21, 2024.
    24. The Commission received one protest, one set of comments, and 
five sets of out of time answers. The Electric Power Supply Association 
(EPSA); the New England Power Generators Association, Inc. (NEPGA); 
Dominion Energy Services, Inc. (Dominion), Constellation Energy 
Generation, LLC (Constellation), and the Independent System Operators 
and Regional Transmission Organizations Council (the ISO/RTO Council) 
filed timely motions to intervene. The Transmission Access Policy Study 
Group (TAPS); Avangrid Renewables, LLC; and the Pennsylvania Public 
Utility Commission filed out of time motions to intervene. NEPGA filed 
timely comments. The ISO/RTO Council filed a timely protest. EPSA, 
TAPS, NERC, and the ISO/RTO Council filed motions for leave to answer 
along with answers.\48\
---------------------------------------------------------------------------

    \48\ TAPS filed two answers.
---------------------------------------------------------------------------

    25. Commenters and protesters raised concerns and requests for 
clarifications for proposed Reliability Standard EOP-012-2. The 
commenters range in their support for proposed Reliability Standard 
EOP-012-2 from requesting that the Commission approve the proposed 
Standard as filed \49\ or approve the proposed Standard as filed with 
minor clarifications,\50\ to requesting that the Commission remand the 
proposed Standard to NERC with directives.\51\ The comments on specific 
matters are summarized and addressed in the determinations below.
---------------------------------------------------------------------------

    \49\ NERC Answer at 1-3; 29.
    \50\ See NEPGA Comments 1-5; EPSA Answer 1-5; TAPS Answer at 1-
2.
    \51\ See ISO/RTO Council Protest at 1-3.
---------------------------------------------------------------------------

III. Determination

A. Procedural Matters

    26. Pursuant to Rule 214 of the Commission's Rules of Practice and 
Procedure, 18 CFR 385.214 (2023), the timely, unopposed motions to 
intervene serve to make the entities that filed them parties to this 
proceeding.
    27. Rule 213(a)(2) of the Commission's Rules of Practice and 
Procedure, 18 CFR 385.213(a)(2) (2023), 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 TAPS, Avangrid Renewables, LLC, 
and the Pennsylvania Public Utility Commission's motions for leave to 
file out of time motions to intervene given their interest in the 
proceeding and the absence of undue prejudice or delay.

B. Substantive Matters

    28. Pursuant to section 215(d)(2) of the FPA, we approve proposed 
Reliability Standard EOP-012-2 as just, reasonable, not unduly 
discriminatory or preferential, and in the public interest. Absent the 
reforms adopted in proposed Reliability Standard EOP-012-2, the 
unexpected failure of generating units during extreme cold weather 
conditions could negatively impact the reliability of the Bulk-Power 
System.
    29. We find that proposed Reliability Standard EOP-012-2 represents 
an improvement over approved Reliability Standard EOP-012-1 as the 
proposed Standard enhances the reliable operation of the Bulk-Power 
System. Specifically, the proposed Reliability Standard will improve 
reliability by requiring generator owners to implement freeze 
protection measures, develop detailed 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 will help address many of the issues 
identified as contributing to generating unit failures during extreme 
cold weather conditions, as noted in the November 2021 Report.\52\
---------------------------------------------------------------------------

    \52\ See November 2021 Report at 184-210.
---------------------------------------------------------------------------

    30. Nevertheless, while we find that NERC's petition is an 
improvement to the currently approved Reliability Standard, we also 
find that there are some elements of proposed Reliability Standard EOP-
012-2 that are not fully responsive to the Commission's February 2023 
Order.\53\ Accordingly, as discussed further below, we direct NERC 
pursuant to section 215(d)(5) of the FPA to address these issues.
---------------------------------------------------------------------------

    \53\ See NERC Petition at 27-28; see also February 2023 Order, 
182 FERC ] 61,094 at PP 1, 3, 6, 9-10, 66, 77-79, 88.
---------------------------------------------------------------------------

    31. Although we find that the Reliability Standard needs additional 
improvement, we are not persuaded that there is sufficient cause to 
remand proposed Standard EOP-012-2, as requested by the ISO/RTO 
Council.\54\ Proposed Reliability Standard EOP-012-2 represents an 
improvement over approved Reliability Standard EOP-012-1, and remanding 
the proposed Standard would allow currently approved Reliability 
Standard EOP-012-1 to go into effect on October 1, 2024, despite its 
ambiguities and other identified issues.\55\
---------------------------------------------------------------------------

    \54\ See ISO/RTO Council Protest at 4.
    \55\ See, e.g., Mandatory Reliability Standards for the Bulk-
Power Sys., Order No. 693, 118 FERC ] 61,218, at P 10; order on 
reh'g, Order No. 693-A, 120 FERC ] 61,053 (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).
---------------------------------------------------------------------------

    32. Below we address the following elements of proposed Reliability 
Standard EOP-012-2: (1) Generator Cold Weather Constraint declaration 
criteria; (2) the entity to receive, review, evaluate, and confirm for 
validity the Generator Cold Weather Constraint declarations; (3) the 
length of the corrective action plan implementation deadlines; (4) the 
corrective action plan

[[Page 55243]]

implementation timelines for existing versus new generating units; (5) 
the generating unit freeze measure applicability exemptions within 
proposed Requirements R2, R3, and R6; (6) the winterization criteria 
for new versus existing generating units; (7) the annual inspections 
and maintenance of a generating unit's freeze protection measures; (8) 
the five-year review period for declared Generator Cold Weather 
Constraints; and (9) cost recovery mechanisms.
1. Generator Cold Weather Constraint Declaration Criteria
a. The Commission's Directive in the February 2023 Order
    33. Under Reliability Standard EOP-012-1, a generator owner could 
explain in a declaration any ``technical, commercial, or operational 
constraints'' that preclude its ability to either implement freeze 
protection measures or implement corrective action plans. However, 
Reliability Standard EOP-012-1 does not define ``technical, commercial, 
or operational constraints,'' leaving those terms open to 
interpretation by each generator owner. In the February 2023 Order, the 
Commission approved Reliability Standard EOP-012-1 but expressed 
concern with the uncertainties, ambiguities, and vagueness of the 
Standard's descriptions of constraints, noting that, without criteria 
to guide the generator owners or guardrails on what constitutes a 
legitimate constraint, generator owners may avoid the purpose of the 
Standard altogether or have declarations without auditable elements. 
Thus, the Commission directed NERC to address the ambiguity of 
generator owner-defined declarations by including auditable criteria to 
ensure that declarations cannot be used to avoid mandatory compliance 
with the Reliability Standard or obligations in a corrective action 
plan.\56\
---------------------------------------------------------------------------

    \56\ February 2023 Order, 182 FERC ] 61,094 at PP 6, 66.
---------------------------------------------------------------------------

b. NERC's Petition
    34. In proposed Reliability Standard EOP-012-2, NERC proposes to 
replace the undefined ``technical, commercial, or operational 
constraints'' with the newly defined Glossary term ``Generator Cold 
Weather Constraint.'' The term explains that constraints are conditions 
precluding generator owners from implementing freeze protection 
measures based on one or more criteria. NERC states that:
    Criteria used to determine a constraint includes practices, 
methods, or technologies which, given the exercise of reasonable 
judgment in light of the facts known at the time the decision to 
declare the constraint was made:
     Were not broadly implemented at generating units for 
comparable unit types in regions that experience similar winter climate 
conditions to provide reasonable assurance of efficacy;
     Could not have been expected to accomplish the desired 
result; or
     Could not have been implemented at a reasonable cost 
consistent with good business practices, reliability, or safety. A cost 
may be deemed ``unreasonable'' when implementation of selected freeze 
protection measure(s) are uneconomical to the extent that they would 
require prohibitively expensive modifications or significant 
expenditures on equipment with minimal remaining life.\57\
---------------------------------------------------------------------------

    \57\ NERC Petition at 28.
---------------------------------------------------------------------------

    35. During the development of proposed Reliability Standard EOP-
012-2, NERC's Standard Drafting Team explained that using a 
reasonableness standard as a benchmark for evaluating constraint 
declarations is appropriate given the wide range of facts and 
circumstances that will be relevant under the definition.\58\ The 
Standard Drafting Team added that the ``reasonableness standard is 
typically an objective test that looks at the average decision maker's 
conduct under the particular facts and circumstances present if they 
exercised average care, skill, and judgement.'' \59\ NERC's Standard 
Drafting Team considered adding specific criteria but was of the 
opinion that the proposed Reliability Standard must be adaptable as 
facts and circumstances change and new solutions are identified and 
become commercially available.\60\ NERC's petition states that the 
language used in the Generator Cold Weather Constraint definition is 
modeled after the concept of ``good utility practice'' and is intended 
to convey that the proposed Reliability Standard ``would not require 
the best solutions, which would result in more constraints being 
declared, but rather acceptable solutions.'' \61\ NERC states that the 
term ``unreasonable costs'' is intended to refer to cost-prohibitive 
modifications or significant expenditures that could lead to premature 
retirement of equipment.\62\
---------------------------------------------------------------------------

    \58\ Id., Ex. F, at 50-51.
    \59\ See id., Ex. F at 1,772.
    \60\ See id.
    \61\ See NERC Petition at 57 (citing to the Commission's pro 
forma Open Access Transmission Tariff, section 1.15).
    \62\ Id.
---------------------------------------------------------------------------

c. Comments
    36. The ISO/RTO Council argues that the discussion of freeze 
protection measures in the newly defined Generator Cold Weather 
Constraint term creates ambiguity that provides far too much discretion 
to the entities required to comply with proposed Reliability Standard 
EOP-012-2.\63\ The ISO/RTO Council believes that the proposed Standard 
provides insufficient guidance concerning a generator owner's exercise 
of discretion to interpret whether freeze protection measures are 
available for its equipment when determining whether a basis exists to 
declare a constraint. As such, the ISO/RTO Council recommends that the 
Commission direct NERC to revise the constraint declaration language so 
that it is clear that freeze protection measures are intended to 
include practices, methods, or technologies that would reasonably be 
expected to result in effective facility performance while operating at 
the Extreme Cold Weather Temperature.\64\
---------------------------------------------------------------------------

    \63\ ISO/RTO Council Protest at 13.
    \64\ Id. at 15.
---------------------------------------------------------------------------

    37. NERC, in its answer, states that its Standard Drafting Team 
determined that proposed Reliability Standard EOP-012-2 should not 
require entities to implement technologies or solutions that had not 
been proven to be effective in similar climate conditions.\65\ TAPS 
members, while initially expressing concern during the development of 
proposed Standard2, now believe that NERC guidance will help ensure 
consistent application of the Generator Cold Weather Constraint 
declaration criteria.\66\ TAPS asserts that the new definition is 
auditable and greatly improves upon NERC's approach in approved 
Reliability Standard EOP-012-1.\67\
---------------------------------------------------------------------------

    \65\ NERC Answer at 14 (noting that the Commission is only 
required to find that the proposed Reliability Standard, as written, 
is just and reasonable rather than the ``best'' option and 
requesting that the Commission give due weight to the expertise of 
the Standard Drafting Team).
    \66\ TAPS Answer at 2-3.
    \67\ Id.
---------------------------------------------------------------------------

    38. The ISO/RTO Council also states that the inclusion of 
``reasonable cost'' in the definition of what qualifies as a potential 
Generator Cold Weather Constraint is subjective, unclear, and un-
auditable.\68\ The ISO/RTO Council is concerned that this would allow 
generator owners to declare a constraint simply by asserting that 
implementing a given freeze protection measure would constitute a `` 
`prohibitively expensive modification[ ]' or a `significant 
expenditure[ ]' and that the affected facility has a `minimal remaining

[[Page 55244]]

life.' '' \69\ They state that this exception effectively injects NERC 
and the Regional Entities into the process of judging the 
reasonableness of costs and a particular generator owner's financial 
situation.\70\ As such, the ISO/RTO Council recommends that the 
Commission direct NERC to remove the cost-based constraints from 
proposed Reliability Standard EOP-012-2.\71\ They state that the 
Commission faces a policy choice of whether to adopt exceptions to 
compliance based on generator owners' assertions of excessive costs or 
whether to apply its FPA section 205 and 206 authority to provide 
avenues for generator owners to recover costs.\72\
---------------------------------------------------------------------------

    \68\ ISO/RTO Council Protest at 6.
    \69\ Id. at 7 (quoting NERC's proposed definition of the 
Generator Cold Weather Constraint).; see also NERC Petition, Ex. A, 
at 3.
    \70\ ISO/RTO Council Protest at 7.
    \71\ Id. at 7-8, 12 (stating that cost should be addressed by 
the Commission through its obligation to ensure just and reasonable 
rates and by the appropriate state, local, and regulatory 
authorities rather than being ``shoehorned'' into a Reliability 
Standard).
    \72\ ISO/RTO Council Answer at 4-8.
---------------------------------------------------------------------------

    39. In contrast, TAPS argues that the definition of an economic 
constraint is quite narrow and does not permit a balancing of costs 
against benefits.\73\ TAPS does not agree with the ISO/RTO Council that 
cost-based constraints should be removed from the Generator Cold 
Weather Constraint definition entirely since that would make the 
proposed Reliability Standard unreasonable and contrary to the 
requirements of FPA section 215(d)(2).\74\ TAPS argues that such 
removal would mandate winterization at any cost, no matter how 
unjustifiable.\75\
---------------------------------------------------------------------------

    \73\ TAPS Answer at 4; TAPS Second Answer at 3.
    \74\ TAPS Answer at 5 (citing to 16 U.S.C. 824o(d)(2), which 
provides that ``[t]he Commission may approve . . . a proposed 
reliability standard . . . if it determines that the standard is 
just, reasonable, not unduly discriminatory or preferential, and in 
the public interest'').
    \75\ Id.
---------------------------------------------------------------------------

    40. In its answer, NERC states that the proposed definition of 
Generator Cold Weather Constraint accounts for concerns that the 
requirements to operate in cold weather could ``lead to fewer 
generators choosing to operate in cold weather due to prohibitive costs 
or technical inability to meet the operational capability 
requirements'' of the proposed Reliability Standard.\76\ NERC asserts 
that the ISO/RTO Council is not taking into account the reliability 
impacts that may occur if the cost of compliance is prohibitively high 
and generators choose not to operate.\77\ On the auditability issue, 
NERC states that the proposed definition is auditable and that the ISO/
RTO Council is conflating ``auditability'' and ``flexibility.'' They 
state that NERC and the Regional Entities ``understand that they will 
be assessing the reasonableness of the process entities use to declare 
constraints'' and will continue to monitor implementation of the 
proposed Reliability Standard closely.\78\
---------------------------------------------------------------------------

    \76\ NERC Answer at 8.
    \77\ Id. at 9.
    \78\ Id. at 10-11.
---------------------------------------------------------------------------

d. Commission Determination
    41. Although NERC's proposal to replace the existing ``technical, 
commercial, and operational'' constraints with the newly defined 
Generator Cold Weather Constraint term and associated criteria meets 
the Commission's directive to develop criteria for constraint 
declarations, it does not meet the Commission's directives to develop 
criteria that are objective, unambiguous, and auditable.\79\ In 
Reliability Standard EOP-012-1, the use of ``technical, commercial and 
operational constraints'' was a stand-alone phrase, and did not include 
any definitions or further explanation of the conditions under which 
such declarations could be made, causing the ambiguity concerns raised 
in the February 2023 Order.\80\ Moreover, Reliability Standard EOP-012-
1 left it up to the generator owner to interpret what it meant to have 
a technical, commercial, or operational constraint. By adding some 
criteria for the constraint declarations, we find that NERC's proposed 
Generator Cold Weather Constraint declaration criteria improves upon 
the status quo.
---------------------------------------------------------------------------

    \79\ February 2023 Order, 182 FERC ] 61,094 at PP 6, 66.
    \80\ See id. PP 6, 64-66.
---------------------------------------------------------------------------

    42. Nevertheless, we share the ISO/RTO Council's concerns that the 
proposed Generator Cold Weather Constraint declaration criteria are 
also ambiguous, which may lead to inconsistent application and 
uncertainty. For example, the proposed definition does not provide 
sufficient guidance on how widely a freeze protection technology must 
be deployed before it will be considered a ``generally implemented'' 
technology. We agree with the ISO/RTO Council's concern that this focus 
on general industry practice, without any way to ensure consistency in 
the application of that language, leaves the Commission without an 
objective standard that can be effectively audited.
    43. In response to the ISO/RTO Council's concern, NERC states that 
its Standard Drafting Team determined that proposed Reliability 
Standard EOP-012-2 should not require the implementation of unproven 
technologies.\81\ We agree. However, in its effort to provide 
flexibility, the proposed Reliability Standard falls short of the 
Commission's directive to develop criteria that are objective, 
unambiguous, and auditable, as discussed further below.\82\ The 
Commission has previously expressed similar concerns regarding the 
vagueness and enforceability of a Reliability Standard's language. For 
example, in Order No. 693 the Commission approved Reliability Standards 
while also expressing concern that the term ``sabotage'' was too 
ambiguous.\83\ Similarly, in Order No. 791 (approving Version 5 of the 
Critical Infrastructure Protection Reliability Standards), the 
Commission raised concerns with vague language that required entities 
to ``identify, assess, and correct'' deficiencies.\84\ The Commission 
determined that the ambiguities resulted in an ``unacceptable amount of 
uncertainty'' and directed NERC to remove the ambiguous language and 
develop appropriate modifications.\85\ In both Order Nos. 693 and 791, 
the Commission approved NERC's proposed Reliability Standards as an 
improvement to reliability, while directing NERC to submit 
modifications to the Reliability Standards addressing the Commission's 
concern regarding the vagueness of particular language. We conclude 
that a similar approach is appropriate in the instant proceeding, given 
the improvements offered by proposed Reliability Standard EOP-012-2 in 
addressing Bulk-Power System reliability during extreme cold weather 
events.
---------------------------------------------------------------------------

    \81\ NERC Answer at 13-14.
    \82\ February 2023 Order, 182 FERC ] 61,094 at PP 6, 66.
    \83\ See Order No. 693, 118 FERC ] 61,218 at PP 1, 461.
    \84\ See Order No. 791, 145 FERC ] 61,160 at PP 49-53, 67, 69.
    \85\ See id.; see also Order No. 693, 118 FERC ] 61,218 at PP 1, 
461.
---------------------------------------------------------------------------

    44. We also find that the inclusion of the clause ``reasonable cost 
consistent with good business practices'' in the third criterion of the 
Generator Cold Weather Constraint definition does not meet the 
Commission's directive to create criteria that are objective, 
unambiguous, and auditable.\86\ In its answer, NERC explains that its 
Standard Drafting Team was concerned about the reliability impacts that 
may follow from a mandate to retrofit a generating unit at any cost 
when many generator owners have significant discretion regarding 
whether and when they will participate

[[Page 55245]]

in the market. While we agree there may be a need to account for 
certain cases in which the cost of retrofitting may be unnecessarily 
burdensome, the mechanism in proposed Reliability Standard EOP-012-2 to 
address such cases provides a recipe for inconsistent outcomes. 
Although NERC argues that the use of ``reasonable cost consistent with 
good business practices'' is akin to the Commission's use of ``good 
utility practice,'' we find such comparisons unavailing. Neither the 
proposed Reliability Standard itself nor the NERC Glossary of Terms 
defines what constitutes a ``reasonable cost'' or ``good business 
practices.'' Even if it did, NERC, as the ERO, is not well positioned 
to assess the reasonableness of a registered entity's economic choices. 
Additionally, while ``good utility practice'' has been widely used in 
Commission-jurisdictional contracts and tariffs,\87\ it has not been 
used in the FPA section 215 context.\88\
---------------------------------------------------------------------------

    \86\ February 2023 Order, 182 FERC ] 61,094 at PP 6, 66.
    \87\ See e.g., Midcontinent Indep. Sys. Operator, Inc., 165 FERC 
] 61,016, P 49 (2018).
    \88\ 16 U.S.C. 824o.
---------------------------------------------------------------------------

    45. The Commission has previously rejected similar attempts to 
include vaguely defined cost considerations in Reliability Standards. 
Specifically, in Order No. 706, the Commission directed NERC to remove 
references to reasonable business judgment in its Reliability 
Standard.\89\ The Commission largely based its finding on the fact that 
NERC's Glossary of Terms did not define the term ``reasonable business 
judgment'' and the Reliability Standard itself did not suggest how the 
term should be interpreted.\90\
---------------------------------------------------------------------------

    \89\ See Mandatory Reliability Standards for Critical 
Infrastructure Protection, Order No. 706, 122 FERC ] 61,040, PP 137-
38 (2008); order on clarification, 126 FERC ] 61,229; order denying 
clarification, 127 FERC ] 61,273 (2009).
    \90\ See id. P 109.
---------------------------------------------------------------------------

    46. We acknowledge that there may be certain instances in which the 
cost of retrofitting may be unduly burdensome. To address such 
instances, NERC should clearly define such exceptions and present them 
for Commission review. For example, one approach could be for NERC to 
provide a limited set of clearly defined circumstances that could serve 
as constraints, such as an attestation \91\ from a generator owner or 
generator operator that: (1) the generating unit is scheduled to retire 
within the next two years; (2) implementing freeze protection measures 
in accordance with the Reliability Standard would cause the generating 
unit to retire within two years; or (3) they would cancel a newly 
scheduled generating unit that has not yet achieved commercial 
operation if required to comply with the freeze protection requirements 
of a Standard.\92\ Including discrete circumstances regarding what 
constitutes an acceptable economic constraint could provide clarity to 
generator owners considering constraint declarations and allow for an 
objective and straightforward evaluation of the constraint declaration 
criteria during compliance monitoring activities.
---------------------------------------------------------------------------

    \91\ As noted below, NERC shall receive, review, evaluate, and 
confirm for validity any Generator Cold Weather Constraint 
declaration in a timely manner. Infra at P 54.
    \92\ For this example, generator owners or generator operators 
should seek cost recovery through the available cost recovery 
mechanisms prior to making attestations about retirement.
---------------------------------------------------------------------------

    47. Accordingly, we direct NERC, pursuant to section 215(d)(5) of 
the FPA, to develop and submit to the Commission for approval 
modifications to proposed Reliability Standard EOP-012-2 that address 
concerns related to the ambiguity of the newly defined Generator Cold 
Weather Constraint term and criteria. Specifically, we direct NERC to 
ensure that the Generator Cold Weather Constraint declaration criteria 
included within the proposed Reliability Standard are objective and 
sufficiently detailed so that applicable entities understand what is 
required of them. One approach to satisfy this directive could be to 
incorporate into the proposed Reliability Standard a limited and 
discrete list of circumstances that would qualify as acceptable 
constraints. We note that NERC's technical rationale document,\93\ 
created by NERC's Standard Drafting Team and included in NERC's filing, 
includes a list of technical constraints that could serve as a starting 
point for a list of circumstances that would qualify as acceptable 
constraints. To the extent that NERC continues to believe that the 
extent of industry adoption for winterization technologies should be a 
criterion for declaring a constraint, NERC should clearly explain in 
its filing how it will assess the extent of such adoption in a way that 
provides for consistent compliance and enforcement outcomes. 
Alternatively, NERC could establish a pre-approval process for all 
Generator Cold Weather Constraint declarations. While a clearly defined 
list may be preferable, a pre-approval process could be established to 
ensure entities' declared Generator Cold Weather Constraints are 
appropriate and can be supported and defended. Further, as part of the 
directive to develop and submit modifications to the Generator Cold 
Weather Constraint definition of proposed Reliability Standard EOP-012-
2, we direct NERC, pursuant to section 215(d)(5) of the FPA, to remove 
the references to ``cost,'' ``reasonable cost,'' ``unreasonable cost,'' 
and ``good business practices'' and replace them with criteria that are 
objective, unambiguous, and auditable. NERC may propose to develop 
modifications that address the Commission's concerns in an equally 
efficient and effective manner, however, NERC must explain how its 
proposal addresses the Commission's concerns.\94\
---------------------------------------------------------------------------

    \93\ See NERC, Drafting Team Reference Manual--Version 5, at 8 
(Jan. 2024), https://www.nerc.com/pa/Stand/Resources/Documents/Drafting%20Team%20Reference%20Manual%20_clean_January%202024.pdf; 
see also NERC, Technical Rationale for Reliability Standards FAQ, at 
1 (Mar. 2018), https://www.nerc.com/pa/Stand/TechnicalRationale/Technical%20Rationale%20FAQs_March2018.pdf.
    \94\ See Order No. 693, 118 FERC ] 61,218 at P 186.
---------------------------------------------------------------------------

2. Entity To Receive, Review, Evaluate, and Confirm for Validity the 
Generator Cold Weather Constraint Declarations
a. The Commission's Directive in the February 2023 Order
    48. In the February 2023 Order, the Commission directed NERC to 
identify the entity that would receive and review the generator owners' 
constraint declarations pursuant to Reliability Standard EOP-012-1, 
Requirements R1 and R7, and to describe how that entity would confirm 
that the generator owners complied with the objective criteria.\95\
---------------------------------------------------------------------------

    \95\ February 2023 Order, 182 FERC ] 61,094 at PP 6, 66.
---------------------------------------------------------------------------

b. NERC Petition
    49. In response to the Commission's directive, NERC proposes new 
Requirement R8, Part 8.2. NERC proposes to require that any generating 
unit cold weather operating limitations due to declared constraints be 
provided to the balancing authority, transmission operator, or 
reliability coordinator via data specifications to the generator owners 
through other Reliability Standard requirements.\96\ In its petition, 
NERC states that its Standard Drafting Team determined that having the 
generator owner communicate the practical impacts of declaring a 
constraint to the entities that are responsible for grid planning and

[[Page 55246]]

reliability would be the best way to address the reliability concerns 
contained in the Commission's directive.\97\
---------------------------------------------------------------------------

    \96\ See NERC Petition at 63. The transmission operators and 
balancing authorities, in accordance with Reliability Standard TOP-
003-5 (Operational Reliability Data), must obtain the generating 
unit(s) minimum design temperature, the historical operating 
temperature, or the current cold weather performance temperature 
determined by an engineering analysis. See Reliability Standard TOP-
003-5, Requirement R1, Part 1.3.2. and Requirement R2, Parts 
2.3.2.1, 2.3.2.2., and 2.3.2.3. Likewise, reliability coordinators 
must obtain this information per Reliability Standard IRO-010-4 
(Reliability Coordinator Data Specification).
    \97\ See NERC Petition at 63 (citing February 2023 Order, 182 
FERC ] 61,094 at P 66).
---------------------------------------------------------------------------

    50. NERC explains that it and the Regional Entities would be 
responsible for assessing entity compliance with the Generator Cold 
Weather Constraint declaration provisions via an audit or other 
compliance monitoring method.\98\ NERC also states that it and the 
Regional Entities are preparing a ``strategy for performing robust 
compliance monitoring and enforcement of the currently effective and 
approved generator cold weather Reliability Standards.'' \99\ Further, 
NERC points to the annual data request and analysis that it asserts 
would allow the Commission to understand the efficacy of, and monitor 
the ongoing risk posed by, technical, commercial, or operational 
constraint provisions.\100\
---------------------------------------------------------------------------

    \98\ Id. at 63-64.
    \99\ Id. at 69.
    \100\ Id.
---------------------------------------------------------------------------

    51. NERC states that it and the Regional Entities understand that 
they will be assessing the reasonableness of the process generator 
owners use to declare Generator Cold Weather Constraints.\101\ NERC 
notes that it will take steps to ensure that its reviews are 
``conducted in a consistent manner across the ERO Enterprise.'' \102\
---------------------------------------------------------------------------

    \101\ Id. at 10-11.
    \102\ Id.
---------------------------------------------------------------------------

c. Commission Determination
    52. We find that proposed Reliability Standard EOP-012-2 does not 
identify an entity to receive the Generator Cold Weather Constraint 
declarations, the entity responsible for timely review of the generator 
owners' constraint declarations, or the entity responsible for ensuring 
that the declarations meet the objective criteria of the proposed 
Standard. Although we agree with NERC that declared constraints can be 
provided to the balancing authority, transmission operator, or 
reliability coordinator via data specifications under existing 
Reliability Standards, this does not address the Commission's directive 
that an entity review and confirm that generator owners complied with 
the constraint criteria.
    53. NERC states that a review of the Generator Cold Weather 
Constraint declarations will occur during compliance activities, and 
that it and the Regional Entities are developing a compliance 
monitoring strategy for the cold weather Reliability Standards.\103\ We 
conclude, however, that NERC's proposal is not an equally efficient and 
effective means to address the Commission's directive and underlying 
concern. First, the NERC Rules of Procedure contain no obligation to 
periodically audit generator owners. Only a handful of generator owners 
are audited each year, and those audits do not assess all Reliability 
Standards and all requirements. Moreover, given the significant 
reliability risk evidenced by the failure of generating units during 
recent extreme winter weather events, we continue to believe that an 
enhanced level of oversight remains necessary to ensure that Generator 
Cold Weather Constraints are only declared when warranted. While 
generator owners' responses to NERC's annual data request regarding the 
Generator Cold Weather Constraint declarations are useful for a wide-
area event analysis or in forecasting future trends,\104\ NERC's annual 
data request will only provide a limited insight into the specific 
facts and circumstances around a Generator Cold Weather Constraint 
declaration. For example, while the annual data request is expected to 
indicate whether the generator owner has declared a constraint for a 
generating unit along with the associated rationale(s) for each 
declaration, it does not collect any supporting documentation necessary 
to justify the generator owners' declared constraints. As a result, we 
are not persuaded that NERC's annual data request constitutes an 
adequate substitute for an appropriate entity contemporaneously 
reviewing and confirming whether a generator owner has complied with 
the objective constraint criteria set out in proposed Reliability 
Standard EOP-012-2.\105\
---------------------------------------------------------------------------

    \103\ See id. at 63-64.
    \104\ See generally N. Am. Elec. Reliability Corp., Compliance 
Filing, Docket No. RD23-1-000 (Feb. 16, 2024).
    \105\ February 2023 Order, 182 FERC ] 61,094 at PP 6.
---------------------------------------------------------------------------

    54. Accordingly, we again direct NERC, pursuant to section 
215(d)(5) of the FPA, to modify proposed Reliability Standard so that 
NERC receives, reviews, evaluates, and confirms for validity the 
Generator Cold Weather Constraint declarations in a timely manner. We 
also direct NERC to include in its compliance filing, a plan to timely 
review such declarations to verify compliance with proposed Reliability 
Standard EOP-012-2 and its successors or obligations in a corrective 
action plan and take corrective action where necessary. For example, 
modifying Standard to require the generator owners to provide 
declarations (or changes to the declarations) to NERC within 45 days. 
It is up to NERC whether it would like to delegate this task to the 
relevant Regional Entities. NERC may propose to develop modifications 
that address the Commission's concerns in an equally efficient and 
effective manner, however, NERC must explain how its proposal addresses 
the Commission's concerns.\106\
---------------------------------------------------------------------------

    \106\ See Order No. 693, 118 FERC ] 61,218 at P 186.
---------------------------------------------------------------------------

3. The Length of Corrective Action Plan Implementation Deadlines
a. The Commission's Directives in the February 2023 Order
    55. The Commission directed NERC to develop three modifications 
pertaining to the corrective action plan deadlines set forth in 
Reliability Standard EOP-012-1. First, the Commission directed NERC to 
shorten the 60-month timeframe for developing corrective action plans 
for existing units.\107\ While the Commission gave NERC discretion to 
determine what the effective date should be shortened to, it also 
emphasized that ``industry has been aware of and alerted to the need to 
prepare their generating units for cold weather since at least 2011'' 
and that NERC should consider the ``amount of time that industry has 
already had to implement freeze protection measures.'' \108\ Second, 
the Commission directed NERC to revise Reliability Standard EOP-012-1 
to include deadlines for completing the corrective actions in the 
plans.\109\ Specifically, the Commission was concerned that the lack of 
a deadline or maximum duration for completing the corrective actions 
could allow identified issues to remain unresolved for an indefinite 
period.\110\ Third, the Commission directed NERC to modify the 
Reliability Standard EOP-012-1, Requirement R2, implementation plan for 
generating units with a commercial operation date prior to October 1, 
2027 to require a staggered implementation of freeze protection 
measures for existing units in a generator owner's fleet with an 
effective date of less than 60 months from regulatory approval.\111\
---------------------------------------------------------------------------

    \107\ See February 2023 Order, 182 FERC ] 61,094 at PP 10, 24. 
Sixty months was determined based on approved Reliability Standard 
EOP-012-1 becoming effective 18 months after the effective date of 
applicable regulatory approvals combined with the 42-month 
compliance date for Reliability Standard EOP-012-1 Requirement R2.
    \108\ Id. P 10.
    \109\ Id. PP 9-10, 79, 88.
    \110\ Id. PP 9-10, 77-79.
    \111\ Id. PP 10, 38.
---------------------------------------------------------------------------

b. NERC's Petition
    56. Proposed Reliability Standard EOP-012-2 requires generator 
owners to

[[Page 55247]]

develop, within 12-months after the effective date of the Reliability 
Standard, a corrective action plan for their existing units to add new, 
or modify existing, freeze protection measures.\112\
---------------------------------------------------------------------------

    \112\ See NERC Petition at 38-39; see also id. at Ex. B at 3.
---------------------------------------------------------------------------

    57. NERC states that proposed Reliability Standard EOP-012-2 does 
not include the staggered timeline for the development of corrective 
action plans that are required for existing units.\113\ NERC shortened 
the timeline to develop the corrective action plan for all existing 
units to 12-months. According to NERC's proposal, the generator owners 
are then allowed an additional 24 months to implement the corrective 
actions to modify existing equipment or existing freeze protection 
measures (Requirement R7.1.1) and 48 months for implementing corrective 
actions requiring new equipment or new freeze protection measures 
(Requirement R7.1.2) listed in the developed corrective action plans 
under proposed Reliability Standard EOP-012-2.\114\
---------------------------------------------------------------------------

    \113\ See id. at 67.
    \114\ Id. at 50-51.
---------------------------------------------------------------------------

    58. In its petition, NERC explains that it considered the 
Commission's directive to stagger implementation across a fleet of 
generating units, but determined that it would address reliability 
risks quicker by establishing a shorter period for full implementation 
of proposed Reliability Standard EOP-012-2 combined with ``aggressive 
timeframes'' for implementing corrective action plan measures.\115\ 
NERC also states that it is likely that some natural staggering would 
occur as entities seek to implement measures across a fleet of 
generating units. NERC's Standard Drafting Team determined that leaving 
entities with flexibility in meeting timetables for implementing 
corrective actions would be ``appropriate in the interest of advancing 
cold weather reliability more quickly and more efficiently.'' \116\
---------------------------------------------------------------------------

    \115\ Id. at 67.
    \116\ Id. at 68.
---------------------------------------------------------------------------

    59. NERC also added a provision permitting a generator owner to 
update a corrective action plan implementation timetable, with 
justification, if it exceeds the 24- and 48-month timeframes in 
Requirement R7 of the proposed Reliability Standard.
    60. Proposed Reliability Standard EOP-012-2, Requirement R2 allows 
generator owners to have corrective action plans for new generating 
units that are similar to corrective actions plans allowed for existing 
generating units. NERC's petition states that ``[t]his revision would 
drive ongoing reliability improvements, through Corrective Action 
Plans, if a new generator does not have sufficient freeze protection 
measures'' at the time of commercial operation, in accordance with 
proposed Requirement R2.\117\
---------------------------------------------------------------------------

    \117\ Id. at 43 (giving the example of a new generating unit 
being too far along in its design process to meet the more stringent 
requirements of proposed Requirement R3 [R2] when it begins 
commercial operation on or soon after October 1, 2027).
---------------------------------------------------------------------------

    61. Proposed Reliability Standard EOP-012-2, Requirement R7 would 
require generator owners to ``include timetables for implementing 
corrective actions that are within specified timeframes and to 
implement corrective actions in accordance with those timetables.'' 
\118\ The timetables would require the completion of corrective actions 
within 48 months of the development of corrective action plans for new 
equipment or freeze protection measures.\119\ Proposed Reliability 
Standard EOP-012-2, Requirement R2 also establishes a compliance date 
of October 1, 2027.\120\
---------------------------------------------------------------------------

    \118\ NERC Petition at 51.
    \119\ Id.
    \120\ Id. at 39-40.
---------------------------------------------------------------------------

c. Comments
    62. The ISO/RTO Council is concerned that even NERC's shorter 24-
month period of implementation is still too long and ``do[es] not 
appropriately reflect the urgency of winterizing generating units.'' 
\121\ According to the ISO/RTO Council, this is especially true for 
those generating units that experience a Generator Cold Weather 
Reliability Event versus the like units that are identified for 
corresponding corrective action plans, which may be at different 
geographic locations with different weather/climate patterns and will 
have different levels of risk of experiencing future freeze related 
issues. The ISO/RTO Council also believes that proposed Reliability 
Standard EOP-012-2 does not sufficiently incentivize generator owners 
to use best efforts to promptly implement all immediate and near-term 
winterization actions before the upcoming winter season.\122\ The ISO/
RTO Council recommends that the Commission direct NERC to revise 
proposed Reliability Standard EOP-012-2 to include a requirement that 
each generator owner document its best efforts to promptly implement 
all immediate and near-term actions prior to the next upcoming winter 
season to winterize each generating unit to operate at its calculated 
Extreme Cold Weather Temperature.\123\
---------------------------------------------------------------------------

    \121\ ISO/RTO Council Protest at 19.
    \122\ Id. at 25; see also ISO/RTO Council Answer at 9-10.
    \123\ ISO/RTO Council Protest at 26; see also ISO/RTO Council 
Answer at 10.
---------------------------------------------------------------------------

    63. NERC replied to the ISO/RTO Council's concern by stating that 
the Standard Drafting Team balanced the need for prompt implementation 
of freeze protection measures with ``factors influencing the ability to 
implement those measures, particularly across a fleet of units.'' \124\ 
In doing so, NERC notes that its Standard Drafting Team decided on an 
approach that would allow generator owners less time to implement 
protections with existing equipment or freeze protection measures and 
more time to implement protections requiring new equipment or freeze 
protection measures.\125\
---------------------------------------------------------------------------

    \124\ NERC Answer at 19-20.
    \125\ Id. at 20.
---------------------------------------------------------------------------

    64. Additionally, the ISO/RTO Council objects to the extension 
provision, believing that NERC and the Regional Entities will only 
evaluate timeline exceedance for appropriateness and proper 
documentation after the fact, either as part of ongoing data 
collections or during compliance efforts.\126\ The ISO/RTO Council 
recommends that the Commission direct NERC to revise Requirement R7, 
Part 7.3, to require generator owners to apply for and receive NERC or 
Regional Entity approval to extend corrective action plan 
implementation timeframes beyond the timeframes established by proposed 
Reliability Standard EOP-012-2.\127\ In response, NERC disagrees and 
states that it ``has identified no reliability need that would justify 
the administrative burdens of such a process in this case.'' \128\
---------------------------------------------------------------------------

    \126\ ISO/RTO Council Protest at 20-22.
    \127\ Id. at 22.
    \128\ NERC Answer at 20-21.
---------------------------------------------------------------------------

d. Commission Determination
    65. The Commission directed NERC to shorten the 60-month deadline 
of Requirement R2 of approved Reliability Standard EOP-012-1 to develop 
corrective action plans for existing units.\129\ By giving generator 
owners 12-months after the effective date of proposed Reliability 
Standard EOP-012-2 to develop corrective action plans to meet their 
Extreme Cold Weather Temperature to add new or modify existing freeze 
protection measures to their existing units, we find that NERC has met 
this directive through modified Requirements R3 and R7 of proposed 
Reliability Standard EOP-012-2.
---------------------------------------------------------------------------

    \129\ February 2023 Order, 182 FERC ] 61,094 at P 88.

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

[[Page 55248]]

    66. Additionally, we are persuaded that NERC's proposed deadlines 
for implementing corrective action plans under Requirement R7 of 
proposed Reliability Standard EOP-012-2 meet the Commission's directive 
aimed at establishing corrective action plan implementation deadlines 
and will provide a significant level of risk reduction compared to the 
status quo. NERC met the Commission's directive by incorporating 
different corrective action plan completion timelines for existing and 
new generating units (24- and 48-months following corrective action 
plan development, as noted in Requirement R7 of the proposed 
Reliability Standard) which will result in staggered corrective action 
plan implementation in stages. We find that this equates to a staggered 
or phased approach.
    67. Nevertheless, we are concerned that the length of NERC's 
proposed 24- and 48-month deadlines for implementing corrective actions 
after a generating unit's failure is too long \130\ and do not meet the 
Commission's directive, which sought to substantially accelerate 
reliability risk mitigation. Specifically, under NERC's proposal, 
resources that are impacted by a Generator Cold Weather Reliability 
Event (e.g., freezing issue resulting in a forced outage or derate) are 
allowed approximately 30 or 54 months to mitigate the cause of the cold 
weather failure, depending on whether existing or new equipment or 
freeze protection measures are needed to remedy the freezing issue. 
Both Winter Storms Uri and Elliott demonstrated that unplanned cold 
weather-related generation outages jeopardize Bulk-Power System 
reliability. As was seen during those events, a generating unit forced 
outage or derate caused by a freezing issue is a known reliability 
risk. For those generating units that fail to operate during an extreme 
cold weather reliability event, their risks must be mitigated quicker 
than NERC proposes regardless of whether existing or new freeze 
protection measures are needed on the units that experience failure.
---------------------------------------------------------------------------

    \130\ Requirement R7 of proposed Reliability Standard EOP-012-2.
---------------------------------------------------------------------------

    68. Accordingly, we direct NERC, pursuant to section 215(d)(5) of 
the FPA, to develop and submit modifications to Requirement R7 of 
proposed Reliability Standard EOP-012-2 to require shorter deadlines to 
implement corrective actions for existing or new equipment or the 
freeze protection measures for those generating units that experience a 
Generator Cold Weather Reliability Event. Based on compliance with 
Requirements R2 and R3, those generating units should have already had 
appropriate freeze protection measures implemented to be capable of 
operating at the generating units' respective Extreme Cold Weather 
Temperature. Therefore, we find that a shorter timeframe to implement 
corrective actions that address existing or new equipment or freeze 
protection measures is appropriate. For example, to satisfy this 
directive, NERC could require generator owners to implement corrective 
actions prior to the next winter season for generating units that 
experience a Cold Weather Reliability Event and to complete freeze 
protection measures on similar equipment on all of its fleet within 24 
months of becoming aware of the freeze issue. For corrective action 
plans that involve larger and more complicated implementations, NERC 
could incorporate a staggered 48-month corrective action plan 
implementation deadline.\131\
---------------------------------------------------------------------------

    \131\ NERC may propose modifications that address the 
Commission's concerns in an equally efficient and effective manner; 
however, NERC must explain how its proposal addresses the 
Commission's concerns. See Order No. 693, 118 FERC ] 61,218 at P 
186.
---------------------------------------------------------------------------

    69. In addition, we agree with the ISO/RTO Council that without the 
appropriate oversight of generator owner's proposed updates to the 
corrective action plan implementation deadlines, the established 
maximum implementation deadlines in proposed Reliability Standard EOP-
012-2, Requirement R7 have less meaning and allow a known reliability 
risk to remain on the Bulk-Power System for a longer time. In light of 
this reliability risk, we find that any updates to corrective action 
plan timeframes beyond the maximum implementation timeframes under 
Requirement R7 must be reviewed and approved by NERC.
    70. Therefore, we direct NERC, pursuant to section 215(d)(5) of the 
FPA, to develop and submit modifications to Requirement R7 of proposed 
Reliability Standard EOP-012-2 to ensure that any extension of a 
corrective action plan implementation deadline beyond the maximum 
implementation timeframe required by the proposed Reliability Standard 
is pre-approved by NERC. This approach is consistent with prior 
Commission action in Order No. 851 where the Commission directed NERC 
to require pre-approval for extensions beyond the timelines required in 
the Reliability Standard.\132\ In Order No. 851, the Commission 
explained that although case-by-case extension determinations may be 
more uncertain or have associated burdens, the more compelling 
imperative is that automatic extensions have the potential for abuse by 
unduly delaying mitigation, and would lead to delayed visibility for 
NERC.\133\
---------------------------------------------------------------------------

    \132\ See, e.g., Geomagnetic Disturbance Reliability Standard; 
Reliability Standard for Transmission Sys, Planned Performance for 
Geomagnetic Disturbance Events, Order No. 851, 165 FERC ] 61,124, at 
P 54 (2018) (directing NERC to revise Reliability Standard TPL-007-2 
(Transmission System Planned Performance for Geomagnetic Disturbance 
Events) to include a process through which corrective action plan 
extensions are considered on a case-by-case basis. NERC later 
revised Reliability Standard TPL-007-2, Requirement R7.4; N. Am. 
Elec. Reliability Corp., Docket No. RD20-3-000, at 1 (Mar. 19, 2020) 
(a delegated order approving Reliability Standard TPL-007-4, which 
requires entities to seek approval from the ERO of any extensions of 
time for the completion of corrective action plan items).
    \133\ Order No. 851, 165 FERC ] 61,124 at P 55.
---------------------------------------------------------------------------

    71. NERC asserts that, during the first three years that proposed 
Reliability Standard EOP-012-2 is mandatory and effective, generator 
owners that are well into their construction phase should have 
additional time (compared to a project at a lesser stage of 
construction) to complete corrective action plans for elements already 
designed.\134\ NERC explains that extra time is needed because NERC, in 
its technical rational, states that ``there needs to be allowances made 
for units that are in the development process, and for which the design 
phase may have already commenced.'' \135\ We are persuaded by NERC's 
rationale that in this scenario the generator owner may need additional 
time. However, we are concerned that the proposed Reliability Standard, 
as currently written, does not make a clear demarcation between 
projects well into their construction phase and those at a lesser phase 
of construction; therefore, it could inadvertently be interpreted to 
allow a generator owner to have 48-months beyond its commercial 
operation date to implement Requirement R2 corrective action plans, 
even if the generator owner has not yet begun to construct its 
generating unit.
---------------------------------------------------------------------------

    \134\ NERC Petition, Ex. C, at 9.
    \135\ Id.
---------------------------------------------------------------------------

    72. We thus find that generators that are commercially operational 
after October 1, 2027, should have freeze protection measures either 
designed into their generating systems, or, if a corrective action plan 
is needed, then it should be completed by the time that such generating 
units go into commercial operation. Accordingly, we direct NERC, 
pursuant to section 215(d)(5) of the FPA, to develop and submit 
modifications to Requirement R7 of proposed Reliability Standard EOP-

[[Page 55249]]

012-2 to clarify that any Requirement R2 corrective action plans must 
be completed prior to the generating unit's commercial operation date.
4. Corrective Action Plan Implementation Timeline Ambiguities
a. NERC Petition
    73. Proposed Reliability Standard EOP-012-2, Requirement R7 states 
that a 24-month timeline applies to corrective actions that address 
existing equipment or freeze protection measures and a 48-month 
timeline applies to corrective actions that require new equipment or 
freeze protection measures.\136\ NERC's Standard Drafting Team stated 
that generator owners would be able to use ``appropriate judgment'' to 
determine the appropriate timeline for corrective action in accordance 
with Requirement R7 of proposed Reliability Standard EOP-012-2.\137\
---------------------------------------------------------------------------

    \136\ Id., Ex. A at 8 (emphasis added).
    \137\ Id., Ex. F at 190.
---------------------------------------------------------------------------

b. Comments
    74. The ISO/RTO Council requests clarification on which corrective 
action implementation timeline applies to which corrective actions 
under Requirement R7 of proposed Reliability Standard EOP-012-2.\138\ 
The ISO/RTO Council argues that some corrective actions might involve 
the application of new freeze protection measures on existing equipment 
or the extension of existing freeze protection measures to newly 
installed equipment, thereby implicating both timelines. Thus, it is 
unclear to them which timeline applies in such situations.\139\ The 
ISO/RTO Council recommends that the Commission direct NERC to revise 
proposed Reliability Standard EOP-012-2 to apply the shorter of the two 
timelines to corrective actions that do not require the installation of 
new equipment.\140\
---------------------------------------------------------------------------

    \138\ ISO/RTO Council Protest at 23.
    \139\ Id. at 22-23.
    \140\ Id.
---------------------------------------------------------------------------

    75. The ISO/RTO Council states that while the use of professional 
judgment is a common method for navigating ambiguities, the fact that 
professional judgment exists is not a valid basis for approving an 
ambiguous Reliability Standard.\141\ In response, NERC states that the 
Commission should not direct NERC to clarify the periods allotted for 
the implementation of freeze protection measures because its strategy 
is consistent with Order No. 672.\142\
---------------------------------------------------------------------------

    \141\ Id. at 24.
    \142\ NERC Answer at 5 (citing to discussion in Order No. 672 
that requires the Commission, when determining whether a proposed 
Standard is just and reasonable, to consider the timetable for the 
implementation of new requirements, including the urgency of the 
need for implementation with the reasonableness of time for entities 
that must comply); Order No. 672, 114 FERC ] 61,104 at P 328.
---------------------------------------------------------------------------

c. Commission Determination
    76. We believe that proposed Reliability Standard EOP-012-2, 
Requirement R7's corrective action plan implementation deadlines have 
remaining ambiguities that need to be addressed. As noted above, the 
Commission has previously expressed similar concerns regarding the 
vagueness and enforceability of Reliability Standards language.\143\ 
Specifically, we agree with the concerns raised by the ISO/RTO Council 
that Requirement R7 of proposed Reliability Standard EOP-012-2 does not 
provide clear direction as to the required corrective action plan 
implementation timeline that applies to certain generator owners. For 
example, it is unclear how the corrective action plan implementation 
timeline would apply if a generator owner had combinations of both 
existing and new equipment for freeze protection measures. Accordingly, 
we direct NERC, pursuant to section 215(d)(5) of the FPA, to develop 
and submit modifications to Requirement R7 of proposed Reliability 
Standard EOP-012-2 to address these ambiguities by expanding on 
Requirement R7.1.1 and 7.1.2 to make it clear which corrective action 
plan implementation deadline applies to which generator owner.
---------------------------------------------------------------------------

    \143\ As further discussed above, in both Order No. 693 and 
Order No. 791, the Commission approved NERC's proposed Reliability 
Standards as an improvement to the reliable operation of the Bulk-
Power System, while also directing NERC to submit modifications to 
the Reliability Standards to address the Commission's concern 
regarding the ambiguities contained in particular language. See 
Order No. 693, 118 FERC ] 61,218 at PP 1, 461; see also Order No. 
791, 145 FERC] 61,160 at PP 49-53, 67, 69.
---------------------------------------------------------------------------

5. Proposed Reliability Standard EOP-012-2, Requirements R2, R3, and 
R6, Footnotes 1, 2, and 4
a. NERC's Petition
    77. Proposed Reliability Standard EOP-012-2, Requirements R2, R3, 
and R6 contain new and identical footnotes 1, 2, and 4, 
respectively.\144\ These footnotes indicate that generating units that 
do not self-commit or are not required to operate at or below a 
temperature of 32 degrees Fahrenheit but ``may be called upon to 
operate in order to assist in the mitigation of [bulk electric system] 
Emergencies, Capacity Emergencies, or Energy Emergencies during periods 
at or below a temperature of 32 degrees Fahrenheit (zero degrees 
Celsius) are exempt'' from Requirements R2, R3, and R6.\145\
---------------------------------------------------------------------------

    \144\ See NERC Petition at 38-39, 48.
    \145\ Id.
---------------------------------------------------------------------------

b. Comments
    78. The ISO/RTO Council raises concerns regarding the limitations 
on applicability created by footnotes 1, 2, and 4 in Requirements R2, 
R3, and R6 of proposed Reliability Standard EOP-012-2.\146\ The ISO/RTO 
Council believes that this exemption should be limited to truly 
seasonal generating units that will not be called upon to operate 
during freezing conditions, even during bulk electric system 
emergencies.\147\ Thus, the ISO/RTO Council recommends that the 
Commission direct NERC to either remove the footnotes 1, 2, and 4 or 
revise Requirements R2, R3, and R6 by replacing the phrase ``self-
commits or is required to operate'' with ``that may be committed to 
operate.'' \148\
---------------------------------------------------------------------------

    \146\ ISO/RTO Council Protest at 15-17.
    \147\ Id. at 16-17.
    \148\ Id. at 18 (stating that this would allow truly seasonal 
generating units that are ineligible to be committed to operate 
during freezing conditions to be exempt from Requirements R2, R3, 
and R6 of proposed Reliability Standard EOP-012-2).
---------------------------------------------------------------------------

    79. In response, NERC states that ``the appropriateness of this 
limited exemption is a settled matter.'' \149\ NERC notes that this 
exemption was included in Reliability Standard EOP-012-1 and the 
Commission already approved that Reliability Standard with this 
delineation.\150\ NERC reiterates that the exemptions, as written, are 
intended to incentivize generating units that do not normally operate 
in freezing conditions to participate in mitigating a bulk electric 
system emergency.\151\
---------------------------------------------------------------------------

    \149\ NERC Answer at 16-17 (stating that the ISO/RTO Council's 
concern is an ``untimely attack on an issue that was previously 
decided by the Commission'' when it approved EOP-012-1); see also 
February 2023 Order, 182 FERC ] 61,094 at P 60.
    \150\ NERC Answer at 16.
    \151\ Id.
---------------------------------------------------------------------------

    80. TAPS agrees with NERC and states that these exemptions are 
appropriate and that NERC's applicability section modifications are in 
line with the Commission's February 2023 Order.\152\ TAPS states that, 
under NERC's proposed modifications to Reliability Standard EOP-012-2, 
the system operator should have already requested and received 
operational limitation data from each bulk electric system generating 
unit in its footprint; thus, there is no additional step for an ISO or 
RTO to take to identify which

[[Page 55250]]

generating units can operate under particular conditions.\153\
---------------------------------------------------------------------------

    \152\ TAPS Answer at 9-12 (citing to the February 2023 Order, 
182 FERC ] 61,094 at P 58).
    \153\ Id. at 11-12.
---------------------------------------------------------------------------

c. Commission Determination
    81. While we appreciate the ISO/RTO Council's concern, we agree 
with NERC and TAPS that the exemptions set forth in Requirements R2, 
R3, and R6, footnotes 1, 2, and 4, respectively, are appropriate and 
that NERC's applicability section modifications are in line with the 
Commission's February 2023 Order. We agree with NERC's aim of exempting 
generating units that do not self-commit or are not required to operate 
at or below a temperature of 32 degrees Fahrenheit and are not 
persuaded that a directive is warranted at this time to further narrow 
this exemption. We expect that, as part of its compliance monitoring 
activities, NERC will continue to monitor the application of the 
exemption to ensure its application is consistent with the generating 
units' actual obligations pursuant to relevant tariffs, contracts, 
regulations, or other binding requirements.
6. Different Winterization Criteria for New and Existing Generating 
Units
a. NERC's Petition
    82. Proposed Reliability Standard EOP-012-2, Requirements R2 and R3 
carry forward the cold weather operational capability requirements for 
new and existing bulk electric system units from approved Reliability 
Standard EOP-012-1, Requirements R1 and R2, respectively.\154\ Proposed 
Requirement R2 applies to generating units that are in commercial 
operation on or after October 1, 2027, and requires them to implement 
freeze protection measures to protect Generator Cold Weather Critical 
Components that provide the capability to operate at the unit's Extreme 
Cold Weather Temperature with sustained concurrent 20 mph wind speed 
for a period of not less than 12 continuous hours or the maximum 
operational duration for intermittent energy resources if less than 12 
continuous hours.\155\ Proposed Requirement R3 applies to generating 
units that are in commercial operation prior to October 1, 2027, and 
requires them to implement freeze protection measures to protect 
Generator Cold Weather Critical Components that provide the capability 
to operate at the unit's Extreme Cold Weather Temperature.\156\ During 
the drafting process, NERC's Standard Drafting Team responded to 
comments by stating that having separate requirements for new and 
existing units is appropriate given that some generating units would be 
difficult to retrofit and that existing units can provide reliable 
performance at temperatures above their Extreme Cold Weather 
Temperature.\157\
---------------------------------------------------------------------------

    \154\ NERC Petition at 37.
    \155\ Id. at 38 (noting that if they are unable to do so, then 
the generator owner must develop a corrective action plan to add new 
or modify existing or previously planned freeze protection measures 
to provide the capability to operate at the unit's Extreme Cold 
Weather Temperature with sustained concurrent 20 mph wind speed for 
a period of not less than 12 continuous hours or the maximum 
operational duration for intermittent energy resources if less than 
12 continuous hours).
    \156\ Id. at 39 (stating that if they are unable to do so, then 
the generator owner must develop a corrective action plan to add new 
or modify existing freeze protection measures to provide the 
capability to operate at the unit's Extreme Cold Weather 
Temperature).
    \157\ Id., Ex. F at 103, 291.
---------------------------------------------------------------------------

b. Comments
    83. The ISO/RTO Council objects to having different winterization 
criteria for new and existing generating units, noting that new units 
have to meet more stringent requirements. The ISO/RTO Council states 
that, while some older generating units may not be able to perform at 
Requirement R2's more stringent standard, many generating units that 
enter commercial operation before October 1, 2027, should be able to do 
so.\158\
---------------------------------------------------------------------------

    \158\ ISO/RTO Council Protest at 26-27.
---------------------------------------------------------------------------

    84. The ISO/RTO Council believes that while some generating units 
would be difficult to retrofit in some cases, the Winter Storms Uri and 
Elliott Inquiry reports cautioned against setting a lower winterization 
standard for an entire category of generating units.\159\ The ISO/RTO 
Council recommends that the Commission direct NERC to remove 
Requirement R3 and revise Requirement R2 to apply to all generating 
units, regardless of when they achieved commercial operation.\160\
---------------------------------------------------------------------------

    \159\ Id. at 27-28.
    \160\ Id. at 28.
---------------------------------------------------------------------------

    85. In its answer, NERC asserts that the ISO/RTO Council's argument 
on grandfathering provisions is an untimely attack on a Commission-
approved issue.\161\
---------------------------------------------------------------------------

    \161\ See NERC Answer at 23.
---------------------------------------------------------------------------

c. Commission's Determination
    86. We agree with NERC that it is appropriate to have separate 
requirements for new and existing generating units within proposed 
Reliability Standard EOP-012-2, Requirements R2 and R3, 
respectively.\162\ NERC's Standard Drafting Team discussed applying the 
same requirements to existing units and new units but determined that 
these requirements would be difficult to retrofit and may not be 
justified ``provided that existing units can prove reliable performance 
at temperatures above their'' Extreme Cold Weather Temperature.\163\ We 
also note that the Commission approved NERC's proposal to have 
different winterization criteria for new and existing generating units 
in the February 2023 Order and no concerns with having different 
winterization criteria were raised in that proceeding.\164\ 
Nevertheless, we strongly encourage existing generating units that are 
capable of implementing the more detailed freeze protection measures 
and corrective actions in line with proposed Reliability Standard EOP-
012-2, Requirement R2 to do so.
---------------------------------------------------------------------------

    \162\ See NERC Petition, Ex. F at 450, 452.
    \163\ Id.
    \164\ See February 2023 Order, 182 FERC ] 61,094 at PP 1-2, 47.
---------------------------------------------------------------------------

7. Annual Inspection and Maintenance of Generating Units Freeze 
Protection Measures
a. NERC's Petition
    87. Proposed Reliability Standard EOP-012-2, Requirement R4, Part 
4.5 requires the annual inspection and maintenance of generating unit 
freeze protection measures.\165\
---------------------------------------------------------------------------

    \165\ See NERC Petition at 45; see also NERC Petition, Ex. A at 
7.
---------------------------------------------------------------------------

b. Comments
    88. The ISO/RTO Council expresses concern that without any 
reference to timing other than a requirement for ``annual'' inspections 
and maintenance, this provision will not result in timely preparations 
for upcoming cold weather operations.\166\ The ISO/RTO Council 
recommends that the Commission direct NERC to revise proposed 
Reliability Standard EOP-012-2 to require inspections and maintenance 
of all generating units to occur on at least an annual basis and always 
within three months of the upcoming winter season.\167\
---------------------------------------------------------------------------

    \166\ ISO/RTO Council Protest at 31; see also ISO/RTO Council 
Answer at 11.
    \167\ ISO/RTO Council Protest at 31-32; see also ISO/RTO Council 
Answer at 11.
---------------------------------------------------------------------------

    89. NERC agrees that it is a good practice to inspect and maintain 
freeze protection measures before an upcoming winter season.\168\ NERC 
disagrees, however, that the proposed Reliability Standard needs to 
require ``in detail the timing of the required annual inspections for 
it to be a just and reasonable standard.'' Moreover, NERC states, the 
Commission approved

[[Page 55251]]

Reliability Standard EOP-012-1 without such specificity.\169\
---------------------------------------------------------------------------

    \168\ NERC Answer at 26.
    \169\ Id. (stating that it could consider the ISO/RTO Council's 
proposal at a later date if the implementation of proposed 
Reliability Standard EOP-012-2, Requirement R4 suggests that more 
specificity would advance reliability).
---------------------------------------------------------------------------

c. Commission Determination
    90. We find that it is premature to address the ISO/RTO Council's 
recommendation that the Commission direct NERC to revise the proposed 
Reliability Standard to require inspections and maintenance of all 
generating units to occur on at least an annual basis and always within 
three months of the upcoming winter season.\170\ We believe that 
requiring the annual inspection and maintenance of generating unit 
freeze protection measures is adequate at this time. By requiring the 
annual inspection and maintenance of generator freeze protection 
measures, proposed Reliability Standard EOP-012-2 (and its predecessor, 
approved Reliability Standard EOP-012-1) represent a significant 
improvement upon the previously effective set of Reliability Standards, 
which did not include such requirements. Although we agree with both 
the ISO/RTO Council and NERC that it is a good practice to inspect and 
maintain freeze protection measures before an upcoming winter season, 
we are not persuaded that such additional specificity is necessary at 
this time. NERC has committed to monitoring the implementation of this 
new Standard and, in doing so, can determine whether there are outage 
patterns or other data that suggest the need for additional 
specificity.\171\
---------------------------------------------------------------------------

    \170\ ISO/RTO Council Protest at 31-32; see also ISO/RTO Council 
Answer at 11.
    \171\ See, e.g., FERC, NERC, and Regional Entity Staff, Inquiry 
into Bulk-Power System Operations During December 2022 Winter Storm 
Elliott, at 132 (Oct. 2023), https://www.ferc.gov/news-events/news/ferc-nerc-release-final-report-lessons-winter-storm-elliott (October 
2023 Report) (recommendation 1(b)).
---------------------------------------------------------------------------

8. The Five-Year Review Period for Declared Generator Cold Weather 
Constraints
a. NERC's Petition
    91. Proposed Reliability Standard EOP-012-2, Requirement R8.1 
states that each generator owner that declares a Generator Cold Weather 
Constraint shall review the declaration at least every five calendar 
years or as needed when a change of status to the Generator Cold 
Weather Constraint occurs.\172\
---------------------------------------------------------------------------

    \172\ NERC's Petition at 62.
---------------------------------------------------------------------------

b. Comments
    92. The ISO/RTO Council expresses concern that once a generator 
owner declares a Generator Cold Weather Constraint, proposed 
Reliability Standard EOP-012-2 only requires the generator owner to 
review that constraint every five years,\173\ which lowers the bar for 
bulk electric system winterization and reliability by delaying the 
identification and adoption of new freeze protection technologies.\174\ 
The ISO/RTO Council states that a five-year review period tips the 
scales in favor of slow installation and application of new 
technologies and ``would result in years elapsing'' between a new 
freeze protection technology becoming viable and a generator owner 
evaluating that technology as part of its routine review of a 
constraint.\175\ As such, the ISO/RTO Council recommends that the 
Commission direct NERC to revise proposed Reliability Standard EOP-012-
2 to require that constraint declaration reviews be performed annually 
instead of every five years.
---------------------------------------------------------------------------

    \173\ See ISO/RTO Council Protest at 29; see also NERC Petition, 
Ex. A at 9.
    \174\ ISO/RTO Council Protest at 29.
    \175\ Id. at 30.
---------------------------------------------------------------------------

    93. NERC disagrees with the ISO/RTO Council's arguments and states 
that many commenters in the standard development process expressed 
concern that annual reviews would be ``an administrative burden [with] 
no reliability benefit.'' \176\ NERC also states that five-year reviews 
were selected because the technology and price of freeze protections 
are unlikely to change significantly over the course of a year.\177\
---------------------------------------------------------------------------

    \176\ NERC Answer at 25 (referencing the development history of 
the proposed Standard and citing commenter concerns).
    \177\ Id.
---------------------------------------------------------------------------

c. Commission Determination
    94. We agree with the ISO/RTO Council that the proposed five-year 
review period for the declared Generator Cold Weather Constraints in 
Requirement R8.1 could delay the identification and adoption of new 
freeze protection measures and does not represent the current pace of 
technological advancements. We acknowledge that a more frequent review 
does impose some additional administrative burden to the generator 
owner to review the technological advancements that hindered its 
ability to winterize; nonetheless, a lengthy period between a Generator 
Cold Weather Constraint declaration review by the generator owner 
offers little incentive to timely adopt new freeze protection 
technologies. Accordingly, we direct NERC, pursuant to section 
215(d)(5) of the FPA, to develop and submit modifications to 
Requirement R8, Part 8.1 of proposed Reliability Standard EOP-012-2 to 
implement more frequent reviews of Generator Cold Weather Constraint 
declarations to verify that the declaration remains valid. NERC may 
propose to develop modifications that address the Commission's concerns 
in an equally efficient and effective manner, however, NERC must 
explain how its proposal addresses the Commission's concerns.\178\
---------------------------------------------------------------------------

    \178\ See Order No. 693, 118 FERC ] 61,218 at P 186.
---------------------------------------------------------------------------

9. Cost Recovery Mechanisms
a. Comments
    95. While NEPGA recognizes that the Commission found cost recovery 
to be outside the scope in connection with its February 2023 Order, it 
asks the Commission to recognize the near-term need for ISO-NE, 
generator owners, and other stakeholders to work together to ensure 
that cost recovery opportunities exit under the ISO-NE tariff.\179\ 
NEPGA argues that the ISO-NE tariff provisions do not appear to allow 
an existing capacity resource to reflect capital costs, such as those 
that may be incurred to modify or add freeze protection equipment.\180\ 
EPSA's Answer supports NEPGA's comments about cost recovery and asks 
the Commission to assess all markets within its jurisdiction to 
determine whether there are sufficient vehicles for recovery of 
winterization costs.\181\
---------------------------------------------------------------------------

    \179\ NEPGA Comments at 2 (citing February 2023 Order, 182 FERC 
] 61,094 at P 83).
    \180\ Id. (citing Cogentrix Energy Power Mgmt., LLC v. FERC, 24 
F.4th 677, 683-4 (D.C. Cir. 2022) to express concern that costs 
incurred prior to the effective date of an associated rate recovery 
mechanism would be unrecoverable).
    \181\ EPSA Answer at 3-5.
---------------------------------------------------------------------------

    96. The ISO/RTO Council acknowledges that cost recovery is 
``critically important'' but argues that costs should not be included 
as part of a Reliability Standard. Instead, the ISO/RTO Council 
contends that cost recovery should be addressed through a rate 
proceeding overseen by the Commission or another applicable regulatory 
authority (e.g., state or provincial).\182\ The ISO/RTO Council 
requests that the Commission ``indicate its intention to allow for cost 
recovery'' for the extreme cold weather Reliability Standards and 
direct its Office of Energy Market Regulation to survey those markets 
within its jurisdiction to determine whether there are sufficient

[[Page 55252]]

vehicles for cost recovery of winterization measures.\183\
---------------------------------------------------------------------------

    \182\ ISO/RTO Council Answer at 4-7.
    \183\ Id. at 4.
---------------------------------------------------------------------------

    97. NERC asserts that while it would support market-related actions 
that advance the goal of generator reliability, it has no opinion with 
respect to the specific cost recovery declaration and survey proposed 
by the ISO/RTO Council.\184\ NERC states that it defers to the 
Commission's expertise on cost recovery.
---------------------------------------------------------------------------

    \184\ NERC Answer at 12.
---------------------------------------------------------------------------

b. Commission Determination
    98. We find the question of whether existing market mechanisms 
provide an opportunity to recover the prudently incurred costs of 
compliance with the proposed Reliability Standard to be outside the 
scope of the instant proceeding, consistent with our finding in the 
February 2023 Order.\185\ To the extent that there are concerns about 
whether existing rates or tariffs allow for the recovery of all 
prudently incurred costs necessary to comply with mandatory Reliability 
Standards as required by FPA section 219,\186\ such questions are more 
appropriately addressed in proceedings pursuant to FPA sections 205 or 
206.\187\
---------------------------------------------------------------------------

    \185\ See February 2023 Order, 182 FERC ] 61,094 at P 83.
    \186\ 16 U.S.C. 824s(b)(4)(A).
    \187\ Id. sec. 824d; see also id. sec. 824e.
---------------------------------------------------------------------------

IV. Information Collection Statement

    99. The information collection requirements contained in this Order 
are subject to review by the Office of Management and Budget (OMB) 
under section 3507(d) of the Paperwork Reduction Act of 1995.\188\ 
OMB's regulations require approval of certain information collection 
requirements imposed by agency rules.\189\ 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.
---------------------------------------------------------------------------

    \188\ 44 U.S.C. 3507(d).
    \189\ 5 CFR 1320 (2023).
---------------------------------------------------------------------------

    100. 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.
    101. The EOP Standards are currently located in the FERC-725S (OMB 
Control No. 1902-0270) collection.\190\ In Docket No. RD24-5-000, the 
Commission proposes to replace the current OMB approved Reliability 
Standard EOP-012-1 with proposed Reliability Standard EOP-012-2 (Table 
1). Proposed Reliability Standard EOP-012-2 has eight requirements, 
seven of which have been carried over and modified from the already 
approved Reliability Standard EOP-012-1 (Requirements R1-R7) and one of 
which is new (Requirement R8).
---------------------------------------------------------------------------

    \190\ The FERC-725S collection includes the EOP family of 
Reliability Standards: EOP-004-4, EOP 005-3, EOP-006-3, EOP-008-2, 
EOP-010-1, EOP-011-4, and EOP-012-2.
---------------------------------------------------------------------------

    102. 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 Reliability Standard EOP-012-2.
    103. The number of respondents below are based on an estimate of 
the NERC compliance registry for generator owners and generator 
operators. Proposed Reliability Standard EOP-012-2 applies to generator 
owners and generator operators. The Commission based its paperwork 
burden estimates on the NERC compliance registry as of April 16, 2024. 
According to the registry for US unique entities, there are 1,210 
generator owners. The estimates in the tables below are based on the 
change in burden from the Reliability Standards approved in this 
order.\191\ The Commission based the burden estimates in the tables 
below on staff experience, knowledge, and expertise.
---------------------------------------------------------------------------

    \191\ The overall burden associated with Reliability Standard 
EOP-012 will be the sum of the burden (responses) from Reliability 
Standard EOP-012-1 (under RD23-1-000) and Reliability Standard EOP-
012-2 (under RD24-5-000).
---------------------------------------------------------------------------

    Public Reporting Burden: The estimated costs and burden for the 
revisions in Docket No. RD24-5-000 are shown in the table below.

               Table 1--Proposed Changes Due to Final Rule in Docket No. RD24-5-000 for EOP-012-2
----------------------------------------------------------------------------------------------------------------
                                                    Number of                    Average number
    Reliability standard &     Type and number of     annual     Total number   of burden hours    Total burden
         requirement                 entity         responses    of responses     per response        hours
                                                    per entity                       \192\
                               (1)...............          (2)     (1) * (2) =  (4)............  (3) * (4) = (5)
                                                                           (3)
----------------------------------------------------------------------------------------------------------------
                                                    FERC-725S
----------------------------------------------------------------------------------------------------------------
                                   One Time Estimate--Years 1 and 2 EOP-012-2
----------------------------------------------------------------------------------------------------------------
EOP-012-2....................  1,210 (GO)........            1           1,210  5 hrs., $373.15  6,050 hrs.,
                                                                                                  $451,511.5.
                                                               -------------------------------------------------
    Sub-Total for EOP-012-2    ..................  ...........           1,210  5 hrs., $373.15  6,050 hrs.,
     (one-time).                                                                                  $451,511.5.
----------------------------------------------------------------------------------------------------------------
                                   Ongoing Estimate--Year 3 ongoing EOP-012-2
----------------------------------------------------------------------------------------------------------------
EOP-012-2....................  1,210 (GO)........            1           1,210  2 hrs.,\193\     2,420 hrs.,
                                                                                 $149.26.         $180,604.6.
                                                               -------------------------------------------------
    Sub-Total for EOP-012-2    ..................  ...........           1,210  2 hrs., $149.26  2,420 hrs.,
     (ongoing).                                                                                   $180,604.6.
    Sub-Total of ongoing       ..................  ...........             404  ...............  807 hrs.,
     burden averaged over                                                                         $60,226.41.
     three years.

[[Page 55253]]

 
    Proposed Total Burden      ..................  ...........           1,614  ...............  6,857 hrs.,
     Estimate of EOP-012-2.                                                                       $511,737.91.
----------------------------------------------------------------------------------------------------------------
                                       Changes to FERC 725S by RD24-5-000
----------------------------------------------------------------------------------------------------------------
FERC-725S modification         Current...........      Current           Total change due to RD24-5-000
                               inventory.........    inventory
                               (hours)...........  (responses)
----------------------------------------------------------------------------------------------------------------
Addition of EOP-012-2........  ..................  ...........           +6,857 hrs., +1,614 responses.
----------------------------------------------------------------------------------------------------------------

    Titles: FERC-725S, Mandatory Reliability Standards for the Bulk-
Power System; EOP Reliability Standards.
---------------------------------------------------------------------------

    \192\ The estimated hourly cost (salary plus benefits) is a 
combination based on the Bureau of Labor Statistics (BLS), as of 
2024, for seventy five percent of the average of an Electrical 
Engineer (17-2071)--$79.31 and mechanical engineers (17-2141)--
$89.86. ($79.31 + $89.86)/2 = 84.585 x .75 = 63.439 ($63.44-rounded) 
($63.44/hour) and twenty-five percent of an Information and Record 
Clerk (43-4199) $44.74 x .25% = 11.185 ($11.19 rounded) ($11.19/
hour), for a total ($63.44 + $11.19 = $74.63/hour).
    \193\ A fraction of generator owners would be required to 
perform the task on an ongoing basis, and the hours represent the 
whole body of generator owners.
---------------------------------------------------------------------------

    Action: Revisions 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: Annually.
    Necessity of the Information: Reliability Standard EOP-012-2 
(Extreme Cold Weather Preparedness and Operations) is 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 Reliability Standard ensures 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 the revised 
Reliability Standards and made a determination that its action is 
necessary to implement section 215 of the FPA. The Commission has 
assured itself, by means of its internal review, that there is 
specific, objective support for the burden estimates associated with 
the information requirements.
    a. Description of the Revision to FERC-725S: The FERC-725S (OMB 
Control No. 1902-0270) is an existing information collection that 
contains the requirements for the EOP-012-1 Reliability Standard. As 
described in the Docket No. RD24-1-000 above, the Reliability Standard 
(EOP-012-1) is proposed to be retired and replaced by EOP-012-2.
    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: Jean Sonneman, email: [email protected], phone: 
(202) 502-6362].
    105. Comments concerning the information collections and 
requirements approved for retirement in this order and the associated 
burden estimates, should be sent to the Commission (identified by 
Docket No. RD24-5-000), using the following methods: Electronic filing 
through https://www.ferc.gov is preferred. Electronic Filing should be 
filed in acceptable native applications and print-to-PDF, but not in 
scanned or picture format. For those unable to file electronically, 
comments may be filed by USPS mail or by hand (including courier) 
delivery: Mail via U.S. Postal Service Only: Addressed to: Federal 
Energy Regulatory Commission, Secretary of the Commission, 888 First 
Street NE, Washington, DC 20426. Hand (including courier) delivery: 
Deliver to: Federal Energy Regulatory Commission, 12225 Wilkins Avenue, 
Rockville, MD 20852.

V. Environmental Analysis

    106. The Commission is required to prepare an Environmental 
Assessment or an Environmental Impact Statement for any action that may 
have a significant adverse effect on the human environment.\194\ The 
Commission has categorically excluded certain actions from this 
requirement as not having a significant effect on the human 
environment. Included in the exclusion are rules that are clarifying, 
corrective, or procedural or that do not substantially change the 
effect of the regulations being amended.\195\ The actions directed 
herein fall within this categorical exclusion in the Commission's 
regulations.
---------------------------------------------------------------------------

    \194\ Reguls. Implementing the Nat'l Env't Pol'y Act, Order No. 
486, FERC Stats. & Regs. ] 30,783 (1987) (cross-referenced at 41 
FERC ] 61,284).
    \195\ 18 CFR 380.4(a)(2)(ii) (2023).
---------------------------------------------------------------------------

VI. Document Availability

    107. 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).
    108. 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.
    109. 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:

[[Page 55254]]

    (A) Proposed Reliability Standard EOP-012-2, the associated 
violation risk factors and violation severity levels, the 
implementation plan, the newly defined terms Fixed Fuel Supply 
Component and Generator Cold Weather Constraint, the revised defined 
terms Generator Cold Weather Critical Component and Generator Cold 
Weather Reliability Event, and the retirement of Reliability Standard 
EOP-012-1 immediately prior to the effective date of proposed 
Reliability Standard EOP-012-2, are hereby approved, as discussed in 
the body of this order.
    (B) NERC's proposed implementation date for Reliability Standard 
EOP-011-4, as well as the proposed retirement of Reliability Standards 
EOP-011-2 and EOP-011-3 immediately prior to the effective date of 
proposed Reliability Standard EOP-012-2, are hereby approved, as 
discussed in the body of this order.
    (C) NERC is hereby directed to develop and submit, within nine 
months of the date of issuance of this order, modifications to proposed 
Reliability Standard EOP-012-2 to address the Commission's concerns, 
including but not limited to, the Generator Cold Weather Constraint 
criteria definition, modifying the proposed Standard so that NERC 
reviews, receives, evaluates, and confirms for validity each generator 
owner's constraint declarations against the developed criteria, 
shortening and clarifying the corrective action plan implementation 
deadlines outlined in Requirement R7 of proposed Reliability Standard 
EOP-012-2, ensuring that the any extension of a corrective action plan 
implementation deadline beyond the maximum implementation timeframe 
required by the proposed Standard is pre-approved by NERC, and 
implementing a more frequent review of the Generator Cold Weather 
Constraint declarations in accordance with Requirement R8.1 of proposed 
Reliability Standard EOP-021-2, as discussed in the body of this order.

    By the Commission. Commissioner Rosner is not participating.

    Issued: June 27, 2024.
Debbie-Anne A. Reese,
Acting Secretary.
[FR Doc. 2024-14668 Filed 7-2-24; 8:45 am]
BILLING CODE 6717-01-P
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