FERC Proposes to Approve Retirement of 74 NERC Standard Requirements

The industry has been anxiously awaiting the outcome of the work that was completed during the 2019 Standards Efficiency Review initiative. On June 7, 2019, the North American Electric Reliability Corporation (NERC) filed several petitions with the Federal Energy Regulatory Commission (Commission) to retire 77 requirements from various Reliability Standards that were identified during Phase 1 of the initiative. This is the largest retirement of requirements since FERC issued Order 788 in 2013 for the 34 requirements retired in association with Paragraph 81.

During Phase 1 of the Standards Efficiency Review, NERC assembled several working teams to identify potential compliance monitoring and enforcement efficiencies that could be achieved following the retirement or modification of various requirements from the INT, FAC, PRC, and MOD Reliability Standards families. Francis Esselman from PCS was an active contributor and team member of the Phase 1 reviews. Each working team used a defined risk-based methodology to identify requirements that provided little to no reliability benefit, supported the administration of existing commercial or business practices, or were deemed redundant with other Reliability Standards.

Following its review of the various petitions, the commission issued a notice of proposed rule-making on January 23, 2020, in which it proposed to approve the retirement of 74 of the 77 requirements. Of those three remaining requirements, the Commission proposed to remand the retirement of R2 of Reliability Standard VAR-001-5 based on concerns that no other obligations for Transmission Operators to schedule reactive resources in real-time would exist. In response to this, NERC filed a petition on May 14, 2020 to withdraw the requirement’s retirement, agreeing with the Commission’s concern.

In addition to their concern around VAR-001-5 R2, the Commission also stated concerns that a reliability gap would exist for certain Transmission Owners following the elimination of the facility rating exchange requirements in R7 and R8 of Reliability Standard FAC-008-3. Specifically, the Commission felt Transmission Owners would not have the information from adjacent Generator or Transmission Owners identifying the next most limiting equipment of a Bulk Electric System Facility, and its thermal rating caused by an Interconnection Reliability Operating Limit, a limitation of a Total Transfer Capability, an impediment to a generator’s deliverability, or an impediment to service to a major load center. To address these specific concerns, NERC responded to the Commission’s request for comments clarifying that Transmission Owners are not the functional entity responsible for the planning and operations of the Bulk Electric System.

PCS is optimistic that the outcome and completion of this initiative is near as we await the publication of FERC’s response to the comments provided by NERC. We will continue to follow the progress of this endeavor and will provide an update as soon as there is more news to share.

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