www.FERC.gov

FEDER AL ENERGY REGULATORY COMMISSION

The Strategic Plan 

FY 2009-2014

Revised March 2013
The Federal Energy Regulatory Commission retains rights to all photographic images included in The Strategic Plan

and thanks FERC staff for their contributions. Images do not exclusively represent regulated industries in 2009.

Images contained may not be reproduced without permission.
FERC’s Mission:

RELIABLE, EFFICIENT AND SUSTAINABLE ENERGY 

FOR CONSUMERS

1. Ensure that rates, terms and conditions are just, reasonable and not 

unduly discriminatory or preferential. 

2. Promote the development of safe, reliable and efficient energy 

infrastructure that serves the public interest.

Assist consumers in obtaining reliable, efficient and sustainable energy services at a 

reasonable cost through appropriate regulatory and market means.

Fulfilling this mission involves pursuing two primary goals:
6 Goal 1: Just and Reasonable Rates, Terms and Conditions 

7 Objective 1.1: Regulatory and Market Means

17 Objective 1.2: Oversight and Enforcement

20 Goal 2: Infrastructure

22 Objective 2.1: Infrastructure Development and Siting

26 Objective 2.2: Safety

29 Objective 2.3: Reliability

34 Appendix A: Factors that May Affect Goal Achievement

34 External Factors

35 Internal Factors

36 Appendix B: Program Evaluation

38 Appendix C: Guiding Principles

40 Appendix D: FERC Organizational Chart and Office Responsibility

42 Appendix E: Statutory Authority

43 Appendix F: Summary of Strategic Plan Changes

Note: A change has been made to this section of the Strategic Plan as permitted by the 

GPRA Modernization Act of 2010. Please see Appendix F for additional information.

Contents
Message from the Chairman

To the Speaker of the House of Representatives, the President of the Senate, the President pro tempore of the Senate and the Director of the Office of Management and Budget:

I am pleased to submit the Federal Energy Regulatory Commission’s revised Strategic Plan through 

fiscal year 2014. We appreciate the opportunity provided by the GPRA Modernization Act of 2010 to 

revise this plan, as necessary.

In our review, we found that the Strategic Goals and Objectives continue to reflect the direction of 

the Commission in supporting national goals and continue to speak to the future of energy policy 

of our country. As an agency, we have achieved great success towards accomplishing our long term 

performance goals. The key strategies contained in this plan still effectively capture our priorities 

and methods for attaining success. As such, we have made three minor changes: updating the timing 

of achieving two performance targets and updating the Commission’s Reliability Objective to more 

clearly convey our authority.

The Commission will continue to rely on its statutory authorities and enabling legislation to meet the 

pressing energy needs of our time. The Commission will continue to balance the competing needs 

and interests of affected parties and fulfill its role as an independent wholesale energy regulator.

I am confident that the Commission and its dedicated staff will continue to meet the needs of the 

American public and serve in the public interest.

Jon Wellinghoff

Chairman

Federal Energy Regulatory Commission

February 2012 • Washington DC 
The Strategic Plan FY 2009-2014 

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ENSURE THAT RATES, TERMS AND CONDITIONS 

ARE JUST, REASONABLE AND NOT UNDULY 

DISCRIMINATORY OR PREFERENTIAL.

GOAL 1

JUST AND REASONABLE RATES, TERMS AND CONDITIONS 

One of the Commission’s fundamental statutory responsibilities is to ensure 

that rates, terms and conditions for wholesale sales and transmission of electric 

energy and natural gas are just and reasonable and not unduly discriminatory 

or preferential. The Commission uses a combination of regulatory and market 

means to achieve this goal, consistent with national policy and priorities. 

Oversight and enforcement are essential complements to the regulatory and market means by which the Commission ensures that rates, terms and conditions of 

service are just and reasonable and not unduly discriminatory or preferential. 

The Commission uses a balanced approach in its oversight and enforcement 

efforts, including: educating affected entities about market rules and other regulations; promoting internal compliance programs; employing robust audit and 

investigation programs; and, where appropriate, exercising the Commission’s 

civil penalty authority as a deterrent to violations.
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OBJECTIVE 1.1

REGULATORY AND MARKET MEANS

1. STRATEGY | Establish rules that enhance competition by allowing non-discriminatory 

market access to all supply-side and demand-side energy resources

The organized wholesale electric markets represent one area in which the Commission relies on regulatory and market means to ensure that rates are just and reasonable and not unduly discriminatory 

or preferential. Improving the competitiveness of these markets is important in achieving that goal 

because it encourages new entry among supply-side and demand-side resources, spurs innovation and 

deployment of new technologies, improves operating performance, and exerts downward pressure on 

costs. Notable benefits also stem from more broadly diversifying the fuels used to generate electricity. 

As described below, the Commission will take several additional steps to ensure a level playing field in 

jurisdictional markets for all types of resources.

Ensure implementation of appropriate regulatory and 

market means for establishing rates. 
The Strategic Plan FY 2009-2014 

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Long Term Performance Goal

¤ Further barriers to participation by demand resources in organized wholesale electric markets will 

be identified and eliminated. 

ANNUAL PERFORMANCE TARGETS 

FY 2010: Evaluate ISO/RTO filings on barriers to demand response. Complete and 

submit National Action Plan on Demand Response 

FY 2011: As appropriate, issue a notice of proposed rulemaking (NOPR) on further steps to 

eliminate barriers to demand resources, including steps identified in National Action 

Plan on Demand Response

FY 2012: As appropriate, issue Final Rule on further steps to eliminate barriers to 

demand resources 

FY 2013: Implement Final Rule as appropriate

FY 2014: Monitor implementation and performance. Evaluate performance and 

seek changes as necessary

Barriers to Demand Resources: The Commission will continue its efforts to identify and eliminate barriers to 

participation by demand resources in organized wholesale electric markets. Demand response, for example, can 

provide competitive pressure to reduce wholesale electric prices, increase awareness of energy usage, provide for 

more efficient operation of markets, mitigate market power, enhance reliability, and, in combination with certain 

new technologies, support the use of renewable energy resources and distributed generation. In its June 2009, 

Congressionally-mandated National Assessment of Demand Response Potential, the Commission found that the 

potential for peak electricity demand reductions across the country is between 38 gigawatts 

(GW) and 188 GW, up to 20 percent of national peak demand, depending on how extensively demand response is applied. In Order No. 719, issued in October 2008, the Commission recognized this potential and directed regional transmission organizations (RTOs) and 

independent system operators (ISOs) that operate organized wholesale electric markets to 

identify barriers to the comparable treatment of demand response resources. The Commission will consider additional market reforms in light of these filings and other developments, 

including the formulation of the Congressionally-mandated National Action Plan on Demand Response. The 

National Action Plan will, among other things, identify requirements for technical assistance and a national communications program, as well as tools and other materials to support the development of demand response. 
Federal Energy Regulatory Commission

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Long Term Performance Goal

¤ Best practices for demand response products and procedures will be explored and, as 

appropriate, implemented in organized wholesale electric markets.

ANNUAL PERFORMANCE TARGETS 

FY 2010: Perform outreach with ISOs/RTOs, demand response providers, and others; 

 as appropriate, issue NOPR on best practices 

FY 2011: As appropriate, issue Final Rule on best practices 

FY 2012: Implement Final Rule as appropriate 

FY 2013: Monitor implementation and performance

FY 2014: Evaluate performance and seek changes as necessary

Best Practices for Demand Response Products and Procedures: Encouraging the implementation of best practices 

for demand response products and procedures in the organized wholesale electric markets will help to achieve 

the potential benefits associated with demand response. The identification of best practices will further facilitate 

demand response participation in these markets on a non-discriminatory basis. The Commission will identify 

best practices through informal outreach with industry representatives and, as appropriate, will consider initiating formal proceedings to reform existing market rules. 

Faces of FERC: Susan Pollonais | Energy Industry Analyst

How does FERC ensure that consumers are paying fair prices for energy in today’s 

modern and highly sophisticated market structure? By having pros like Susan 

Pollonais on our team. While Susan started her energy career working for a 

major utility in the Midwest, she jumped at the chance to come to FERC 12 

years ago to “sit on the other side of the table.”

As an analyst at FERC, Susan’s place at the table requires her to ensure that 

wholesale customers purchase energy at just and reasonable rates. Her 

experiences as an advisor to a former FERC Chairman and as an advisor in 

FERC’s Office of Administrative Litigation have made her a true expert in 

natural gas and electricity.

“I am responsible for monitoring sales in the Nation’s wholesale electricity markets to help ensure that electricity is available at competitive prices and that 

market rules are working effectively,” Susan says. Years at FERC: 12
The Strategic Plan FY 2009-2014 

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Long Term Performance Goal

¤ All resources technically capable of providing needed ancillary services will have the 

opportunity to provide those services.

ANNUAL PERFORMANCE TARGETS 

FY 2010: Perform outreach to identify the need for modification or creation of additional 

ancillary services, and issue NOPR, as appropriate

FY 2011: As appropriate, issue Final Rule on ancillary service products and procedures

FY 2012: Implement Final Rule as appropriate 

FY 2013: Monitor implementation and performance

FY 2014: Evaluate performance and seek changes as necessary

Participation in Ancillary Services Markets: The provision of ancillary services is critical to the reliable operation 

of the interstate electric transmission grid. In Order No. 890, issued in February 2007, the Commission revised 

the pro forma Open Access Transmission Tariff to allow customers to self-supply any ancillary service that their 

resources are capable of providing (except for those services 

that, for technical reasons, are required to come from the 

transmission provider). To build on this reform, the Commission will consider instituting formal proceedings to 

determine whether the modification or creation of ancillary 

services is necessary to support the provision of transmission 

service on terms and conditions that are just and reasonable 

and not unduly discriminatory or preferential. As part of 

any such proceeding, the Commission could seek to remove 

barriers that may exist to any resource capable of providing 

an ancillary service from having the opportunity to do so. 
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Long Term Performance Goal

¤ Market reforms which will allow renewable resources to compete fairly will be explored and, as 

appropriate, implemented in Commission-jurisdictional markets.

ANNUAL PERFORMANCE TARGETS 

FY 2010: Perform outreach with industry and issue staff white paper identifying potential need 

for and types of market reforms

FY 2011: Issue a notice of inquiry (NOI/NOPR) on market reforms, if appropriate

FY 2012: Issue Final Rule on market reforms, if appropriate

FY 2013: Monitor implementation and performance

FY 2014: Evaluate performance and seek changes as necessary

Renewable Resources: The use of renewable energy 

resources to generate electricity has the potential to be 

a cost-effective means not only to reduce greenhouse 

gas emissions, but also to diversify the fuels used to 

generate electricity. The Commission will continue to 

pursue market reforms to allow all resources, including 

renewable energy resources, to compete in jurisdictional 

markets on a level playing field. These efforts could 

include amendments to market rules, the modification 

or creation of ancillary services and related policies, or 

the implementation of operational tools that support 

the reliable integration of renewable resources. By 

implementing these or other reforms, the Commission’s actions have the potential to increase the amount 

of electricity being produced from renewable energy 

resources.
The Strategic Plan FY 2009-2014 

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2. STRATEGY | Promote operational efficiency in wholesale markets through the exploration and encouragement of the use of software and hardware that will optimize market 

operations

Long Term Performance Goal

¤ By FY 2014, efficiency in market operations will be enhanced through deployment of new software 

and optimization of hardware.

ANNUAL PERFORMANCE TARGETS 

FY 2010: Internal release of staff white paper; industry outreach, including technical 

conferences, to identify best practices

FY 2011: Pursue voluntary adoption of best practices by RTOs/ISOs; if appropriate, issue Policy 

Statement and/or NOI/NOPR 

FY 2012: Follow-up workshops on best practices implementation; issue Final Rule, if relevant

FY 2013: Monitor implementation and performance 

FY 2014: Evaluate performance and seek changes as necessary 

The Commission will identify opportunities to enhance operational efficiency in jurisdictional markets by encouraging public 

utilities, particularly RTOs and ISOs, to deploy new modeling 

software and optimize their market operations. By improving 

efficiency in the use of computational methods and identifying 

ways in which the operation of utility assets can be optimized, 

the Commission will enhance operational efficiency to the benefit of all public utility customers. In addition, the Commission 

will consider implementation of rules and practices developed 

by individual RTOs and ISOs, as well as the North American Energy Standards Board (NAESB) and the North American Electric 

Reliability Corporation (NERC). 
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3. STRATEGY | Develop and implement a common set of performance metrics for 

markets within and outside of ISOs/RTOs 

Long Term Performance Goal

¤ By FY 2014, the performance of markets within and outside of ISOs/RTOs will be measured using 

a common set of metrics. 

ANNUAL PERFORMANCE TARGETS 

FY 2010: Explore and develop appropriate operational and financial metrics for 

ISOs/RTOs

FY 2011: Explore and develop appropriate operational and financial metrics for non-ISO/RTO 

regions 

FY 2012: Explore and develop appropriate operational and financial metrics for non-ISO/ RTO 

regions 

FY 2013: Establish appropriate common metrics between ISOs/RTOs and non-ISOs/RTOs

FY 2014: Monitor implementation and performance

Faces of FERC: Kermit Banks | Energy Industry Analyst 

Formerly a math teacher, Kermit Banks joined FERC 12 years ago and continues to 

make sure the electric utilities play by the rules. 

As a FERC energy industry analyst, Kermit examines the rate applications of 

electric utilities to make sure the companies are not engaging in market 

manipulation. 

“I need to ensure fair rates for customers,” Kermit says of his work. “There are 

occasions when we discovered that certain companies were abusing the 

system, and we took away their rate authority. It is important that market 

power is mitigated and we protect consumers.”

Years at FERC: 12

Note: A change has been made to this section of the Strategic Plan as permitted by the GPRA Modernization Act of 2010. 

Please see Appendix F for additional information.
The Strategic Plan FY 2009-2014 

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In Order No. 2000, the Commission encouraged the voluntary formation of RTOs to operate the electric transmission grid and to create organized wholesale electric markets. The development of RTOs and modified market 

structures was aimed at increasing the efficiency of wholesale electric market operations and increasing non-discriminatory access to the transmission grid. The Commission mandated that RTOs be independent from market 

participants, fairly exercising operational authority over all transmission facilities under their control. 

Today, RTOs and ISOs serve roughly two-thirds of all electricity customers in the United States by providing 

transmission service, interconnecting new resources to the transmission grid, and operating organized wholesale electric markets. In recent years, the Commission has issued dozens of orders implementing reforms to the 

services provided and the markets operated by RTOs and ISOs in an effort to enhance competition and increase 

efficiency. The Commission will continue to address various services, including congestion on the transmission 

grid and interconnection queues to increase efficiency and maintain just and reasonable rates, terms and conditions that are not unduly discriminatory or preferential.

To support these further enhancements to RTO and ISO activities, the Commission will develop appropriate 

operational and financial metrics to measure the performance of RTOs and ISOs and transactions in the markets 

they administer. The Commission will also develop appropriate metrics for non-ISO/RTO markets to allow for 

comparisons of various market structures. By FY 2014, all ISOs/RTOs and non-ISOs/RTOs will use a common set 

of metrics to measure performance. 

Faces of FERC: Deborah Osborne | Group Manager, Dispute Resolution Service

Building the energy superhighways that power America means balancing the 

concerns of everyone from consumers to companies, and everything from the 

environment to culture to local history. 

Few people could be more adept at this crucial juggling act than Deborah Osborne, 

who became a certified mediator after serving as an anthropologist and 

archaeologist at FERC. In fact, her experience with environmental and cultural 

resources and work experience with other cultures, such as Native Americans, 

made her a natural recruit for FERC’s Dispute Resolution Service shortly after it 

was formed in 1999.

The only difference between the two worlds of learning about people, she says, is 

that “artifacts don’t talk back.”

In dispute resolution, “we stand ready to help people,” she says. “You gain so much.”

Years at FERC: 23
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4. STRATEGY | Promote broad participation, including the use of alternative dispute resolution services, in the Commission’s processes and procedures 

Long Term Performance Goal

¤ By FY 2014, appropriate filings and issues will employ alternative dispute resolution and 

collaborative processes first. 

ANNUAL PERFORMANCE TARGETS 

FY 2010: Develop guidelines/tariff provisions to apply to filings/issues amenable to 

consensual resolution

FY 2011: Implement rules setting forth guidelines/tariff provisions and initiate pilot programs

FY 2012: Implement rules setting forth guidelines/tariff provisions and initiate pilot programs

FY 2013: Conduct study to determine if pilot program should be expanded

FY 2014: Determine if number of consensual resolutions increased and evaluate whether additional 

steps are necessary to achieve appropriate use of ADR and collaborative processes

The Commission recognizes the value of using an open and transparent process in which stakeholders are engaged 

early. This practice increases the probability of a successful outcome in which all parties’ concerns are addressed. 

This concept has been successfully implemented in the Commission’s Integrated Licensing Process for siting 

hydroelectric infrastructure and in the pre-filing process for siting natural gas infrastructure. In these processes, 

the Commission fully engages stakeholders to identify and discuss issues that may impact the development of the 

project. The Commission will apply this concept to other areas of the Commission’s work in order to improve 

regulatory outcomes. 

The Commission further recognizes the value of resolving cases through consensual means and of using alternative dispute resolution techniques in the energy market proceedings it oversees. In fact, about 80 percent of the 

contested proceedings set for hearing at the Commission are settled. The settlement of these cases is enormously 

beneficial to energy consumers. It dramatically limits the time, expense and resources that the Commission and 

Note: A change has been made to this section of the Strategic Plan as permitted by the GPRA Modernization Act of 2010. 

Please see Appendix F for additional information.
The Strategic Plan FY 2009-2014 

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outside parties would otherwise need to devote to these cases. Further, when appropriate, a settlement provides 

rapid refunds of overcharges to energy consumers. In fact, Commission approved settlements provide hundreds 

of millions of dollars of refunds annually to ratepayers throughout the United States. Additionally, settlements 

provide regulatory certainty in a much shorter period of time than if the case were litigated. This allows informed 

investment decisions to be made by energy companies wishing to develop energy infrastructure, including renewable energy resources, in a more timely and efficient manner. Further, the resolution of a case through settlement 

is likely to be more acceptable to the parties than a litigated outcome, and therefore minimizes the likelihood of 

an appeal. Thus, settlements eliminate the time and expense associated with the appellate court process and a 

potential remand of the case to the Commission.

The Commission also offers a full range of independent, neutral, third party Alternative Dispute Resolution 

(ADR) services within the Commission and to outside parties to prevent, manage and resolve energy conflicts. 

Facilitation, mediation and early-neutral-evaluation processes have a proven track record of success across a wide 

spectrum of energy and environmental disputes in all energy sectors regulated by the Commission. Stakeholders 

committed to ADR processes for collaborative problem-solving and case dispute resolution at the Commission 

average an 86 percent success rate. Parties that use ADR are satisfied with the results, produce durable consensual 

agreements and often return to ADR because it is proven to have positive effects on business relationships. Going 

forward, ADR processes and tools will increase in value and popularity to meet consumer needs and fulfill the requirements of complex, 

multi-disciplinary energy initiatives on the Nation’s horizon. 

In the coming years, the Commission will apply these concepts to 

other areas of the Commission’s work in order to improve regulatory outcomes. The Commission will begin by identifying issues 

and proceedings that lend themselves to consensual resolution and 

conducting a pilot project. After analyzing the effects of the pilot, 

the Commission will look for ways to expand the effort.

The Commission promotes broad participation in its processes in 

several other ways, as well. For example, the Commission generally issues a Notice of Proposed Rulemaking, 

which is published in the Federal Register, to announce its consideration of changes to its regulations and to solicit 

comments from any interested entities. The Commission considers all such comments in development of any 

final rule. The Commission may also issue a Notice of Inquiry through the Federal Register to gather information. 

The Commission also holds technical conferences as a way to involve stakeholders in rulemaking and other proceedings. Technical conferences provide the Commission with valuable information on stakeholders’ views and 

other information that may prove useful in the development of new policies.

 
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1. STRATEGY | Promote internal compliance programs and self-reporting of violations

Long Term Performance Goal

¤ By FY 2014, electric and natural gas industries will meet the following criteria: 

1. 70 percent of company compliance programs reviewed on Commission audits for the 

audit focus areas are found to be adequate to demonstrate a culture of compliance.

ANNUAL PERFORMANCE TARGETS 

Performance Measure 1

FY 2010: 10%

FY 2011: 25%

FY 2012: 40%

FY 2013: 55%

FY 2014: 70%

OBJECTIVE 1.2

OVERSIGHT AND ENFORCEMENT

Increase compliance with the Commission’s rules and deter market manipulation.
The Strategic Plan FY 2009-2014 

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2. 70 percent of compliance programs reviewed through investigations that involve a 

penalty are found to be sufficiently robust to merit credit to reduce the penalty.

ANNUAL PERFORMANCE TARGETS 

Performance Measure 2

FY 2010: 10%

FY 2011: 25%

FY 2012: 40%

FY 2013: 55%

FY 2014: 70%

To increase compliance with the Commission’s rules, the Commission sees opportunities to explain the intent and 

requirements of its rules to stakeholders. Moreover, the Commission has encouraged utilities to adopt internal 

compliance programs to prevent violations and instances of noncompliance. The Commission issued a policy 

statement on compliance that identified elements of an effective compliance program. The Commission also 

stated that if a robust compliance program was in effect when a violation occurred, any resultant penalty may be 

reduced or eliminated. 

The Commission will review compliance programs as part of its compliance audits, issue publicly available audit 

reports, and engage in formal and informal outreach efforts to promote effective compliance programs. In 

addition, the Commission will further this strategy by giving companies credit against settlements if a robust 

compliance program was in effect when the violation occurred. In cases where a company is given a reduced civil 

penalty, the settlement agreement should be made known to the industry in order to encourage others to adopt 

and implement robust and thorough compliance programs. 

The success of these efforts will be measured by the existence of robust compliance programs by the regulated 

entities.  The Commission anticipates that it will find, through audits and investigations, that regulated entities 

have created a culture of compliance. The Commission further expects that this culture of compliance will lead to 

companies actively addressing and minimizing areas of systematic noncompliance.
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2. STRATEGY | Use a risk-based approach to plan and prioritize audits of jurisdictional 

companies

Long Term Performance Goal

¤ By FY 2014, 80 percent of the Commission’s audit program will be planned using a risk-based 

approach.

ANNUAL PERFORMANCE TARGETS 

FY 2010: 40%

FY 2011: 60%

FY 2012: 80%

FY 2013: 80%

FY 2014: 80%

In its enforcement role, the Commission takes proactive steps on a variety of fronts to reduce the probability that 

violations will occur. The Commission conducts compliance audits and performs investigations of alleged violations of relevant statutes and Commission rules. 

The Commission prepares a plan each year that addresses a variety of audit topics for the upcoming fiscal year. 

The audit plan represents the Commission’s formal plan of action to accomplish the audit goals and objectives for 

the fiscal year. Audits are planned and prioritized using a risk-based approach in order to maximize the impact of 

the Commission’s resources. Audit topics included are determined from many sources including, but not limited 

to, legal and technical experts at the Commission, information gleaned from ongoing and completed audits, and 

contact with industry and state commissions. 

Audit candidates included in the plan are chosen based on three primary methods: (1) internally developed 

screens that consider various risk factors; (2) input from the Commission’s other program offices; and 

(3) Commission orders. Once an audit candidate is selected, the Commission assesses the areas of potential risk 

of noncompliance under the Commission’s regulatory requirements. The risk assessment is typically completed 

before an audit begins and is updated as necessary during the audit. 

Although the Commission currently uses risk factors in developing its audit plan, the Commission is striving to 

have 80 percent of its audits planned using a risk-based approach by FY 2014. The Commission will develop approaches that take many risk factors into account when planning and prioritizing audits. 
The Strategic Plan FY 2009-2014 

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The Commission plays an important role in the development of a strong 

energy infrastructure that operates efficiently, safely and reliably.

One aspect of the Commission’s role in energy infrastructure development stems from siting authority that includes licensing non-federal hydropower projects, certificating interstate natural gas pipelines and storage 

projects, authorizing liquefied natural gas (LNG) facilities, and, in certain 

circumstances, permitting electric transmission lines. Throughout all of 

these processes, the Commission’s goal is to expedite application processing 

without compromising environmental responsibilities or public participation. Reconciling these interests, however, remains a significant challenge. 

The Commission believes that issues are best addressed openly and early 

in the application process. The Commission encourages, and sometimes 

requires, project proponents to engage in early involvement of state and 

federal agencies, Indian tribes, affected landowners and the public.

The efficient operation of energy infrastructure involves improving the use 

and operation of infrastructure through, for example, the use of new technologies, and procedures that enhance economic efficiency. The Commission promotes these goals in several ways. For example, the Commission 

can provide incentives for the appropriate use of advanced technologies. In 

the context of the electric transmission system, the use of advanced technologies can, among other benefits, improve energy efficiency by decreasing line losses or it may enable customers to make choices about when to 

shift or reduce demand. Similarly, effective electric transmission planning 

that evaluates all resources and options for cost effective solutions can contribute to the development of energy efficient infrastructure that enhances 

economic efficiency.

GOAL 2

INFRASTRUCTURE 

PROMOTE DEVELOPMENT OF SAFE, RELIABLE, 

AND EFFICIENT INFRASTRUCTURE THAT SERVES 

THE PUBLIC INTEREST.
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The Commission is responsible for the safety of LNG and non-federal hydropower facilities throughout 

the entire life cycle of a project: design review, construction and operation. To meet this mandate, FERC 

primarily relies on physical inspections of the facilities. The dynamic dam safety program must adapt 

to assimilate advances in technology as well as new technical challenges presented by the aging national 

water resources infrastructure.

The Commission also has an important role in maintaining the reliability of the electric transmission 

grid. The Energy Policy Act of 2005 charged the Commission with overseeing a reliable bulk power system infrastructure and mandated the establishment of an Electric Reliability Organization (ERO). The 

ERO is to develop and enforce mandatory reliability and cyber security standards, subject to the Commission’s oversight and approval. The Commission also monitors system disturbances to identify near 

and long-term issues affecting generation and transmission. In addition, the Commission will be exploring technical, reliability and market issues associated with integrating additional renewable generation 

into the electric transmission grid.

Spanning across these three important objectives is the Commission’s commitment to the security of the 

transmission system, oil and gas pipelines, liquefied natural gas facilities and hydropower infrastructure. 

With the newly created Office of Energy Infrastructure Security (OEIS), the Commission will leverage 

its existing resources in a coordinated manner to provide leadership, expertise, and assistance in identifying, communicating, and seeking comprehensive solutions to significant potential cyber and physical 

security risks to the energy infrastructure under the Commission’s jurisdiction. Using the Commission’s 

current authorities under the Federal Power Act, the Natural Gas Act, and the Interstate Commerce Act, 

the office will identify current and emerging defense and mitigation strategies for cyber and physical 

security threats to energy infrastructure. 

The office will concentrate its efforts and resources in four areas: 

•	 developing recommendations for identifying and communicating mitigating alternatives for potential cyber and physical security threats to Commission jurisdictional energy infrastructure; 

•	 offering assistance,expertiseand adviceto otherfederaland stateagencies,and jurisdictional utilities,

for identifying and communicating mitigating alternatives for cyber and physical security threats to 

Commission jurisdictional energy infrastructure;

•	 contributing to interagency and intelligence-related coordination and collaboration efforts with appropriate federal, state agencies and industry representatives on cyber and physical security matters 

related to Commission jurisdictional energy infrastructure;

•	 conducting outreach to improve the exchange of information with private sector owners, users and

operators of the energy delivery systems, regarding identification, communication and mitigation of 

cyber and physical threats to Commission jurisdictional energy infrastructure.

The work of the new office will be complementary to the Commission’s existing regulatory processes. 
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1. STRATEGY | Encourage new electric transmission facilities that advance efficient 

transmission system operation

Long Term Performance Goal

¤ By FY 2014, 50 percent of all new transmission projects will incorporate advanced 

technologies.

OBJECTIVE 2.1

INFRASTRUCTURE DEVELOPMENT AND SITING

Increase efficient infrastructure consistent with demand.

ANNUAL PERFORMANCE TARGETS 

FY 2010: 5%

FY 2011: 10%

FY 2012: 20%

FY 2013: 35%

FY 2014: 50%

The lack of adequate transmission facilities creates 

a significant barrier to trade between markets and 

among regions. To encourage greater investment 

in the Nation’s transmission infrastructure, Congress directed the Commission in the Energy Policy Act of 2005 to adopt rules making incentive rate 

treatments available for electric transmission infrastructure investments meeting certain criteria. Incen-
Federal Energy Regulatory Commission

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tive rate treatments granted pursuant to those rules include, for example, recovery of increased return on 

equity, recovery in rate base of 100 percent of construction work in progress, and recovery of prudently 

incurred costs for projects that are abandoned for reasons beyond the utility’s control.

Congress has also directed the Commission to adopt standards and protocols to govern the implementation of smart grid technologies that can enhance reliability and efficiency in the operation of the Nation’s electric transmission grid. Smart grid advancements use digital communications and advanced 

technologies to modernize the transmission of electricity and the operation of energy markets. The 

Commission will support the deployment of smart grid applications by reviewing and adopting, as appropriate, standards and protocols developed through the process coordinated by the National Institute 

of Standards and Technology (NIST). In addition, the Commission will implement rate treatment policies that support investments in smart grid technologies in the interim period between development and 

approval of smart grid standards.

Through the use of incentive rates, the adoption of smart grid standards, and other transmission-related activities, the Commission aims to increase the number of transmission projects that incorporate 

advanced technologies. By 2014, 50 percent of all new transmission projects will incorporate advanced 

technologies. 

Faces of FERC: Carlton Steen | Energy industry analyst

Carlton Steen is on the front lines ensuring that natural gas and oil consumers are 

paying just and reasonable rates for the energy they use. He’s gone from auditing natural gas producer costs for rate cases to analyzing pipeline companies’ 

costs, no small undertaking. 

“It can be kind of difficult at times,” Carlton says. “You have to make sure all the 

pipes get their fair share of overhead costs.”

In the case of a dispute, Carlton provides either written or oral testimony for 

contested hearings.

It’s rewarding work, Carlton says. “You feel good once you get it done.”

Years at FERC: 30
The Strategic Plan FY 2009-2014 

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2. STRATEGY | Support electric transmission planning through the use of open and transparent processes that include analysis and consideration on a comparable basis of proposed 

solutions involving any of generation, transmission, and demand resources

Long Term Performance Goal

¤ By FY 2014, all public utilities will implement open and transparent transmission planning processes that meet the strategy.

ANNUAL PERFORMANCE TARGETS 

FY 2010: Assessment of transmission planning process best practices, including the potential for 

collaborative decision making, and issue NOPR, as appropriate1

FY 2011: As appropriate, issue Final Rule on transmission planning process best practices

FY 2012: Implement Final Rule as appropriate

FY 2013: Monitor implementation and performance

FY 2014: Evaluate performance and seek changes as necessary

Although ownership of the interstate electric transmission grid is highly disaggregated, with more than 500 

owners, the need for, and effect of, transmission expansions to meet both reliability and economic needs must 

be considered not only on a local basis, but also on a sub-regional and regional basis. The Commission therefore 

requires transmission providers to participate in an open and transparent regional transmission planning process 

that aims to improve the coordination of transmission planning among utilities. Such coordination will support 

the development of an efficient transmission system and enhance competition in wholesale electric markets by 

reducing barriers to trade between markets and among regions. These transmission planning processes will also 

increase the availability of non-discriminatory access to transmission service, increase access to renewable energy 

resources, and ensure that proposed solutions involving generation, transmission and demand resources are 

analyzed and considered in a comparable manner. As transmission providers refine their transmission planning 

processes, the Commission will assess best practices, including the potential for collaborative decision making, 

and adopt reforms as necessary to its transmission planning process requirements.

1 Assessment includes how options to transmission are considered.
Federal Energy Regulatory Commission

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3. STRATEGY | Promote efficient design and operation of natural gas facilities

Long Term Performance Goal

¤ By FY 2014, 100 percent of jurisdictional natural gas companies will be examined for feasibility of 

installing waste heat recovery systems.

ANNUAL PERFORMANCE TARGETS 

FY 2010: 20%

FY 2011: 40%

FY 2012: 60%

FY 2013: 80%

FY 2014: 100%

The Commission is examining the design and operation of jurisdictional natural gas facilities and exploring 

ways to improve and promote greater efficiency at these 

facilities, including the feasibility of installing waste heat 

recovery systems in jurisdictional natural gas facilities. 

The Interstate Natural Gas Association of America’s (INGAA) February 2008 White Paper as supplemented in 

June 2009, identified applicability thresholds for various 

waste heat recovery opportunities for interstate natural 

gas pipelines. Waste heat recovery is the process of collecting the waste heat emitted from compressor units as 

a by-product of combustion, and then using that heat to run generators and create electricity. Waste heat recovery 

is important because it has the potential to allow the industry to transform a current waste product, otherwise lost 

into the atmosphere, into additional electricity for our Nation. 

Beginning in FY 2010 and continuing through FY 2014, Commission staff will conduct bi-monthly reviews of 

Electronic Bulletin Boards (EBBs)2

 to gauge the availability of information on waste heat recovery potential. 

Companies are not currently required to post information regarding 

waste heat feasibility on their EBBs, but the Commission will encourage companies to post this information voluntarily so that there is 

greater transparency across the industry. Staff will also review the FERC 

Form 567, annual flow diagrams, to identify companies with facilities 

that may be candidates for waste heat recovery efforts. Working with 

INGAA, the Commission will meet with other industry representatives 

to discuss and gain feedback on these efforts. The Commission will also 

consider the potential flow implications of taking compressors out of 

service for installation of waste heat recovery facilities while facilities 

balance their stated transportation contracts. 

2 EBBs are internet sites where pipeline companies must post certain information to be in 

compliance with Part 284.12 and 284.13 of the Commission’s regulations.
The Strategic Plan FY 2009-2014 

26

1. STRATEGY | Incorporate risk-informed decision making (RIDM) into the dam safety 

program

Long Term Performance Goal

¤ By FY 2014, risk-informed decision making will be incorporated into the FERC dam safety 

program.

ANNUAL PERFORMANCE TARGETS 

FY 2010: Develop action plan

FY 2011: Portfolio Risk Assessment of FERC dam inventory 

FY 2012: Determine RIDM is consistent with regulatory process

FY 2013: Finalize policy and technical guidelines 

FY 2014: Fully incorporate RIDM into the dam safety program

The administration and execution of the Commission’s dynamic dam 

safety program ensures that the non-federal hydropower projects under 

the Commission’s jurisdiction are safe. The dam safety program involves 

physical safety inspections and also applies advances in technology to address the technical challenges presented by aging national water resources 

infrastructure. 

OBJECTIVE 2.2

SAFETY

Minimize risk to the public.
Federal Energy Regulatory Commission

27

In FY 2009, the Commission explored how risk assessment methodologies could benefit its dam safety program. 

The Commission determined that risk assessment could have the following positive impacts on its program:

•	 Better understand and quantify potential failure modes;

•	 Identify previously unidentified failure modes with high risk;

•	 Understand the consequences of potential failure modes on life, health and property;

•	 Understand the uncertainty and variability in traditional analyses;

•	 Understand the risk associated with a single dam or the Commission’s entire inventory of dams;

•	 Compare the safety of different dams using a common basis, risk;

•	 Compare the relative contribution to risk of all failure modes at a given dam; and

•	 Evaluate risk reduction alternatives and effectively reduce the risk that Commission-jurisdictional dams pose to 

the public in quantifiable and defensible terms.

Many other federal regulatory agencies have incorporated risk assessment methodologies into their work as well. 

Importantly, the United States Bureau of Reclamation has been a leader in the development of dam safety risk assessment methodologies and currently uses a risk-informed decision making process in the process of continuously evaluating the safety of its dams. Over the last two years, the United States Army Corps of Engineers (USACE), 

in cooperation with Reclamation and with requested participation from Commission staff, has developed a series 

of policy and procedure documents that will guide the use of risk-informed decision making in USACE.

Faces of FERC: Kim Nguyen | Civil engineer

How do you generate 15 million megawatts of clean energy for millions of people 

while looking out for fish, animal habitat, boaters and people? Ask Kim Nguyen. 

Little did she know when she showed up at a recruiting session at the Society of 

Women Engineers 18 years ago that she would wind up devoting her career to 

bringing Americans safe, reliable and clean energy. 

Kim’s work is essential to millions of Americans. She coordinated the teams that 

worked on the relicensing of integral parts of the largest hydroelectric system in 

the country – a major source of electricity for millions of people in the Pacific 

Northwest. 

Kim’s work on dam licenses involves balancing crucial environmental, cultural and 

recreational concerns with the power generation of the Pacific Northwest.

Thanks to Kim and her FERC coworkers, the dams will protect and enhance fish 

populations, including salmon, trout and sturgeon, as well as other animals and 

their habitat, while protecting the scenic Columbia River and its recreational 

activities, historic and cultural resources. 

Years at FERC: 18
The Strategic Plan FY 2009-2014 

28

The Commission will develop an action plan in FY 

2010 that could lead to fully incorporating riskinformed decision making into the dam safety program. This action plan will identify and schedule 

the critical steps in progressing toward this goal. In 

FY 2011, the Commission will prepare a portfolio 

risk assessment of FERC’s dam inventory. Through 

this high-level process of assessing each dam, staff 

will be able to identify high-risk dams that need 

more urgent attention. By identifying these dams, 

the current safety status and the need for additional 

dam safety studies and investigations will be thoroughly evaluated. By using risk-informed decision making, the 

Commission will be able to focus its resources on those structures that pose the greatest risk.

In the event of a dam failure, there are both economic (property damage, environmental impacts and costs 

associated with loss of use of the resource) and loss of life consequences. Risk-informed decision making will 

enable the Commission to make better dam safety decisions that will, in turn, better protect life, health and 

property. Risk-informed decision making will be an added tool with which to assess dam safety. It will not 

replace the other, more traditional methods such as Commission inspections or independent engineering 

consultant inspections of dams. 
Federal Energy Regulatory Commission

29

1. STRATEGY | Process Reliability Standards in a timely manner

Long Term Performance Goal

¤ By FY 2014, proposed Reliability Standards will be processed in a timely manner at least 80 percent 

of the time.

ANNUAL PERFORMANCE TARGETS 

FY 2010: 75%

FY 2011: 75%

FY 2012: 75%

FY 2013: 80%

FY 2014: 80%

The Reliability Standards development process requires the ERO to use an open and inclusive process that involves extensive negotiation, consultation and coordination among many stakeholders. Regional Entities may 

also develop and propose regional Reliability Standards or regional modifications to a national Reliability Standard. In addition, the ERO may submit interpretations of approved standards, subject to Commission review.

In all such cases, the Commission must evaluate the proposed standard and either approve or remand these types 

of filings submitted by the ERO. Once proposed standards are filed, it is important that the Commission respond 

in a timely manner so that mandatory and enforceable standards affecting reliability can be implemented. 

OBJECTIVE 2.3

RELIABILITY

Provide for the reliable operation of the bulk power system through oversight of the 

development and implementation of mandatory and enforceable standards.

Note: A change has been made to this section of the Strategic Plan as permitted by the GPRA Modernization Act of 2010. 

Please see Appendix F for additional information.
The Strategic Plan FY 2009-2014 

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2. STRATEGY | Monitor, audit and enforce Reliability Standards 

Long Term Performance Goal:

¤ By FY 2014, Reliability Standards will be enforced effectively, resulting in a reduction of the frequency of repeat violations by at least 10 percent.

ANNUAL PERFORMANCE TARGETS 

FY 2010: Establish tracking process 

FY 2011: Track violations per entity

FY 2012: Track violations per entity

FY 2013: Identify number of repeat violations using NOPs

FY 2014: Decrease repeat violations by 10%

Faces of FERC: Cynthia Pointer | Electrical engineer

The massive blackout of August 14, 2003 plunged millions of Americans into 

darkness, and left consumers and government officials demanding answers. 

FERC engineer Cynthia Pointer was among the six FERC engineers who 

answered the call to help the U.S.-Canada Power System Outage Task Force 

analyze data from the blackout that would answer the crucial questions: how 

did this happen, and how can we prevent it from happening again? 

“The Commission was not known for having electrical engineers” at that time, 

she says. “When the blackout occurred, they (former Chairman Wood and 

his chief advisor) were interested in finding people within the Commission 

who knew how to read and understand the event data.” 

Cynthia’s specialty, system protection and control, gave her the experience 

necessary to sift through and help make sense of what went wrong. And the 

engineering support she and her colleagues provided the Task Force helped 

set the stage for FERC to take on the added authority of overseeing the reliability of the Nation’s’s bulk power.“

Today, Cynthia continues to oversee the development of reliability standards 

designed to protect Americans from a terrible event like the blackout of 2003.

Years at FERC: 11
Federal Energy Regulatory Commission

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The Commission will enforce compliance with the Reliability Standards primarily through its oversight of the 

ERO and Regional Entities. This will typically be accomplished by participating in selected ERO and Regional Entity compliance audits and investigations of users, owners and operators of the bulk power system. The Commission will also perform independent audits as well as conduct independent investigations of significant blackouts, 

system disturbances, and other reliability incidents. 

When the Regional Entities or the ERO identifies a violation - whether through self-reports of violations, audits, 

investigations, or complaints – the ERO submits a Notice of Penalty (NOP) filing for Commission approval. The 

NOP filing includes a record supporting a finding of a violation of one or more Reliability Standards, a proposed 

penalty and a mitigation plan to remedy the violation(s) and prevent recurrence.

Rigorous audits and investigations of potential violations coupled with penalties when appropriate and adequate 

mitigation plans should reduce the frequency of repeat violations of the Reliability Standards. In order to determine the effectiveness of the compliance program, the Commission will track the number and type of violations, 

particularly violations of Reliability Standards involving high Violation Risk Factors. 
The Strategic Plan FY 2009-2014 

32

3. STRATEGY | Identify reliability parameters that affect goals of reducing carbon and 

increasing the penetration of renewable energy resources on the electric grid.

Long Term Performance Goal

¤ By FY 2014, reliability parameters that could affect goals of reducing carbon and increasing the 

penetration of renewable energy resources on the electric transmission grid will be finalized.

ANNUAL PERFORMANCE TARGETS 

FY 2010: Establish contacts and develop research, data collection and reporting processes

FY 2011: Track studies and identify or propose reliability parameters. Perform initial analysis to 

assess if they are feasible for the bulk power system

FY 2012: Track studies and identify or propose reliability parameters. Perform expanded 

analysis to assess if they are feasible for the bulk power system

FY 2013: Present analysis to industry

FY 2014: Consider industry input and finalize the parameters

Certain renewable resources, such as wind and solar energy, are variable in nature. In order to improve the reliability of these energy types, these renewable 

energy resources may require reserves to address the variations in the deliverable energy. The Commission will identify reliability parameters related to 

renewable energy resources and the electric transmission grid to assess whether 

they are feasible for the bulk power system. Commission staff has established 

processes to track studies that are related to the development of reliability 

parameters associated with the integration of these renewable energy resources 

into the bulk power system. Commission staff will analyze the studies to 

explore the feasibility of these reliability parameters and once they are identified, Commission staff will perform a more detailed analysis to determine if the 

Note: A change has been made to this section of the Strategic Plan as permitted by the GPRA Modernization Act of 2010. 

Please see Appendix F for additional information.
Federal Energy Regulatory Commission

33

selected reliability parameters are feasible. The Commission also will seek input from industry and will coordinate and work with other government agencies to identify reliability issues that affect the goals of reducing carbon 

and increasing the penetration of renewable energy resources.

The Commission’s strategy to identify these reliability parameters includes: tracking current, past and future studies performed in the interconnections, regions, ISOs, RTOs, international arena and state commissions; participating in industry groups in the areas of renewable energy resources, carbon-based generation, and carbon sequestration; researching legislation and regulation in the U.S. and in the international arena to gauge the success of 

similar or proposed reliability parameters; tracking equipment and developing technologies on the products that 

impact a particular reliability parameter; and developing, analyzing and presenting proposals to form the basis of 

a study that will identify reliability parameters by using the expertise in the Commission, industry, educational 

institutions and other government agencies.
The Strategic Plan FY 2009-2014 

34

EXTERNAL FACTORS

The Commission faces a number of external and internal challenges in its 

efforts to meet its strategic goals. 

Market Dynamics

While the Commission seeks to encourage investment in energy infrastructure by establishing rules that allow for non-discriminatory market access to 

all resources, the financial community may decide that other investments are 

better uses of limited capital. 

Several factors affect the supply and demand for energy, which in turn, affect the business operations of the public utilities subject to the Commission’s 

jurisdiction and its ability to implement Commission policies. For example, 

changes in economic conditions impact the supply and demand for energy 

and the related need for energy infrastructure investment. Weather conditions such as cooler than normal temperatures in the summer, or warmer 

than normal temperatures in the winter, can reduce the amount of electricity 

and natural gas needed to cool and heat homes. Severe weather can damage 

existing energy infrastructure and impede the development of new facilities. 

APPENDIX A

FACTORS THAT MAY AFFECT GOAL ACHIEVEMENT 
Federal Energy Regulatory Commission

35

Stakeholder Actions

The Commission encourages the development of competitive markets by approving efficient market rules, reducing barriers to participation by all supply-side and demand-side resources, and preventing the exercise of market 

power. However, the Commission cannot control the actions or preferences of individual market participants. 

Support for particular types of products or resources will be driven by consumer demand and, as a result, markets 

may develop in different ways and at a different pace. 

The Commission encourages broad stakeholder participation in the development of new regulatory programs 

and market rules. However, the ability and willingness of stakeholders to engage in the process of identifying and 

implementing reforms is beyond the control of the Commission. 

Government Actions

Congress or state legislatures could enact legislation that prevents, inhibits or accelerates the effectiveness of reforms pursued by the Commission. Congress may not appropriate adequate funds for the Commission to achieve 

its strategic goals. 

State commissions could take actions that affect the desire of companies to invest in new technologies and other 

resources or that otherwise affect reforms pursued by the Commission. 

Technology

The ability of companies to enhance operational efficiency will be driven by advancements in technology. Delays 

in the development and deployment of software and hardware could therefore affect the Commission’s efforts to 

increase efficiency in the operations of companies subject to its jurisdiction.

INTERNAL FACTORS

The Commission’s ability to meet its strategic goals also depends on using its limited resources productively and 

efficiently. The Commission’s most valuable resource is its staff, which includes highly qualified economists, 

attorneys, engineers, industry analysts, information technology experts, administrative staff and other experts. 

The Commission’s ability to recruit, hire, train, motivate and retain qualified staff in a competitive job market is 

critical to its ability to meet its strategic goals.

Technology also drives the ability of the Commission to gather and analyze data regarding energy markets. The 

Commission must continue to upgrade its own infrastructure in order to achieve its strategic goals.
The Strategic Plan FY 2009-2014 

36

To prepare for the update of the Strategic Plan, Commission staff met with 

OMB to discuss ways in which the document could be improved. Commission 

staff and OMB focused on four major initiatives that will improve the current 

Strategic Plan and lay the foundation for future updates:

•	 Develop a focused and well-defined mission statement; 

•	 Align strategic goals with statutory authorities;

•	 Develop a short list of long-lasting performance measures; and

•	 Create a more user-friendly document that is written clearly and 

in plain English.

To begin the update, a cross-office team was assembled to discuss the four major 

initiatives. This team worked with the Chairman and his Chief of Staff to develop 

the new Mission Statement. The new Mission Statement, which is derived from 

statutory authorities, reflects the shifting national focus and priorities for the 

country’s energy future.

APPENDIX B

PROGRAM EVALUATION 
Federal Energy Regulatory Commission

37

The team compiled a list of statutory authorities and worked with the Chairman and his staff to write the new 

strategic goals and objectives. The strategies to achieve the objectives were then written. The strategies reflect the 

Commission’s priorities and direction. The senior leaders of the Commission developed long term performance 

measures that will be used to gauge progress towards achievement of strategic objectives. 

Each year during the Congressional Performance Budget cycle, results for these performance measures will be 

gathered and evaluated. The Commission will take advantage of this opportunity to track the success of each 

measure and determine if the actual results will lead to the accomplishment of each long term performance 

measure, thus leading to the achievement of the Commission’s long term performance goals and objectives. 

Through this annual evaluation process, the Commission will be able to identify when means and strategies 

must be adapted to changing circumstances. 

The Commission will also identify indicators that can be monitored by the program offices throughout the year 

to assess progress in between the annual evaluation cycle. The Chairman will meet at least semiannually with 

senior leaders to discuss progress towards performance measures, external and internal factors affecting success 

and the indicators. The Chairman and staff will use the information discussed in these meetings to make 

decisions about means and strategies.

Because the Strategic Plan’s structure is rooted in statutory authority, we are confident it will lead to a long lasting document 

that will enable long term evaluation of goals and objectives. 

Only through consistent evaluation and monitoring can the 

Commission stay on course to achieve its strategic goals.

Further, the Commission’s future performance budgets and 

performance reports will be aligned with this new Strategic 

Plan. This will allow the Commission to examine the full-time 

equivalent (FTE) and funding associated with each strategic goal 

and objective.

The Commission is committed to high-quality management practices and internal controls to ensure that all 

resources are used effectively and efficiently, and in accordance with established laws and regulations. The 

Commission will also continue to undergo an annual financial audit, conducted by independent auditors. 

Further, the Commission’s Division of Internal Audits will continue to review and make recommendations on 

performance measures, data collection methodologies and reporting of results. 
The Strategic Plan FY 2009-2014 

38

Five principles guide the Commission as it exercises its jurisdiction under its governing statutes. Whether the Commission is adjudicating a rate filing, ruling on a 

permit application, or developing a new policy, it strives to meet these criteria as 

a means of ensuring that each of its actions is consistent with the public interest.

Organizational Excellence 

Above all, the Commission strives to use its resources efficiently and effectively to 

achieve its strategic priorities. The Commission performs targeted recruiting and 

hiring and has developed a markets-oriented training curriculum for entry-level as 

well as experienced staff. The Commission also makes efficient use of its information technology to receive filings, produce reports and orders, and maintain data 

repositories. The Commission tracks the activities of its staff to ensure that they 

meet the Commission’s strategic goals and objectives.

APPENDIX C

GUIDING PRINCIPLES THAT STRENGTHEN THE 

COMMISSION’S OVERALL PERFORMANCE 
Federal Energy Regulatory Commission

39

Due Process and Transparency 

Paramount in all of its proceedings is the Commission’s determination to be open and fair to all participants. All 

significant initial filings submitted to the Commission are announced by way of public notice published in the 

Federal Register. Material issues of fact are litigated at public hearings governed by due process rules. The Commission encourages the use of alternative dispute resolution procedures, which provide for effective public participation in resolution of a proceeding. The Commission often conducts conferences to receive input from members of 

the public on controversial issues. The Commission also provides free webcasts on its Web site of major technical 

conferences held at the Commission and of open Commission meetings where many of its major decisions are 

announced and discussed.

Regulatory Certainty 

In each of the thousands of orders, opinions and reports issued by the Commission each year, the Commission 

strives to provide regulatory certainty through consistent approaches and actions. Without an assurance that the 

Commission’s policies will be internally consistent and applied fairly, investors may be unwilling to bear the risks 

associated with investing in critical energy infrastructure. Where it is appropriate, the Commission provides generic direction to industry participants in the form of guidance orders, policy statements or rulemakings, to avoid 

the uncertainty present in case-by-case adjudications. The Commission also has adopted market rules designed 

to help prevent market manipulation, provide a more stable marketplace, and create an environment that will 

attract needed investment capital.

Stakeholder Involvement 

The Commission conducts regular outreach to ensure that interested parties have an appropriate opportunity to 

contribute to the performance of the Commission’s responsibilities. The Commission also organizes technical 

conferences and workshops designed to explain and explore issues related to the development and implementation of its policies. The Commission also holds regional conferences to identify infrastructure conditions, needs 

and investment, as well as environmental and landowner concerns. Finally, in processing hydropower and gas 

related permit applications, the Commission conducts an extensive collaborative pre-filing process, during which 

it receives input from a multitude of stakeholders including citizen groups, environmental organizations, tribal 

interests, and local, state and federal resource agencies. The Commission has applied the same pre-filing process 

for resolution of certain transmission siting applications.

Timeliness 

The Commission’s goal is to reach an appropriate resolution of each proceeding in an expeditious manner. 

Toward that end, the Commission has steadily decreased the time it takes to act on projects, such as LNG import 

terminals, gas storage facilities and interstate natural gas pipelines. It has done so without compromising its environmental protection and public participation responsibilities. The Commission also sets and tracks compliance 

with goals for timely resolution of filings for cost recovery, new services or changes to existing services, as well as 

opinions resolving initial decisions, complaints and FPA section 203 applications.
The Strategic Plan FY 2009-2014 

40

Commissioner Commissioner Chairman Commissioner Commissioner

New York Regional Oce

Atlanta Regional Oce

Chicago Regional Oce

Portland Regional Oce

San Francisco Regional 

Oce

As of February 2013

Hagerstown Satellite 

Oce Oce of Electric Reliability

Oce of Energy Market Regulation

Oce of Energy Infrastructure Security 

Oce of Administrative Law Judges 

Oce of Administrative Litigation

Oce of Energy Projects

Oce of Enforcement

Oce of the Executive Director

Oce of Energy Policy and Innovation

Oce of the Secretary Oce of External Aairs 

Oce of the General Counsel 

APPENDIX D

ORGANIZATIONAL CHART AND OFFICE RESPONSIBILITY
Federal Energy Regulatory Commission

41

actions are issued by the Commission. The Secretary promulgates and publishes all orders, rules, and regulations 

of the Commission and prescribes the issuance date for 

these unless such date is prescribed by the Commission.

Office of Enforcement (OE)

Protects customers through understanding markets and 

their regulation, timely identifying and remedying market problems, assuring compliance with rules and regulations, and detecting violations and crafting appropriate 

remedies, including civil penalties. 

Office of Energy Projects (OEP)

Fosters economic and environmental benefits for the Nation through the approval and oversight of hydroelectric, 

natural gas (including pipelines, storage and liquefied 

natural gas (LNG) facilities) and electric transmission 

projects that are in the public interest. 

Office of Energy Infrastructure Security (OEIS)

Provides leadership, expertise and assistance to the Commission to identify, communicate and seek comprehensive solutions to potential risks to FERC-jurisdictional 

facilities from cyber attacks and physical threats.

Office of the General Counsel (OGC)

Provides legal services to the Commission. Represents 

the Commission before the courts and Congress and is 

responsible for the legal aspects of the Commission’s 

activities.

Office of Administrative Law Judges (ALJ) 

Resolves contested cases as directed by the Commission 

either through impartial hearing and decision or through 

negotiated settlement, ensuring that the rights of all parties are preserved. 

Office of External Affairs (OEA)

Responsible for communications and public relations 

of the Commission. OEA provides informational and 

educational services to Congress; federal, state and local governments; the news media and the public; and 

regulated industries, consumer and public interest groups. 

This office also is the Commission’s liaison with foreign 

governments. 

Office of Electric Reliability (OER)

Oversees the development and review of mandatory reliability and security standards; ensures compliance with 

the approved mandatory standards by the users, owners 

and operators of the bulk power system. 

Office of Energy Market Regulation (OEMR)

Provides technical and policy advice on matters involving 

markets, tariffs and rates relating to electric, natural gas 

and oil pipeline facilities and services as well as demand 

response, energy efficiency, distributed generation, renewable energy issues, greenhouse gas emissions policies and 

advanced technologies relevant to the grid and wholesale 

markets. 

Office of Energy Policy and Innovation (OEPI)

Issues, coordinates and develops proposed policy reforms to address emerging issues affecting wholesale and 

interstate energy markets, including such areas as climate 

change, the integration of renewable resources, and the 

deployment of demand response and distributed resources, smart grid and other advanced technologies.

Office of Administrative Litigation (OAL) 

Litigates or otherwise resolves cases set for hearing. Represents the public interest and seeks to litigate or settle cases 

in an equitable manner while ensuring the outcomes are 

consistent with Commission policy. The Dispute Resolution Service (DRS) is located within OAL and provides 

neutral, third-party assistance using alternative dispute 

resolution (ADR) methods to parties in regulatory and 

environmental conflict; trains staff and energy stakeholders in collaborative problem-solving tools to develop and 

ensure a reliable infrastructure.

Office of the Executive Director (OED)

Provides administrative support services to the Commission including human resources (HR), procurement, information technology (IT), organizational management, 

financial and logistic functions. 

Office of the Secretary (OSEC) 

Serves as the official focal point through which all filings 

are made for all proceedings before the Commission, notices of proceedings are given, and from which all official 
The Strategic Plan FY 2009-2014 

42

ELECTRIC, HYDROPOWER, & GENERAL STATUTES

Federal Power Act (FPA)

Energy Policy Act of 2005 (EPAct 2005)

Energy Policy Act of 1992

Power Plant and Industrial Fuel Use Act

Department of Energy Organization Act

Electric Consumers Protection Act (ECPA)

Electronic Freedom of Information Act of 1996

Energy Independence and Security Act of 2007 (EISA)

Public Utility Holding Company Act of 1935 (PUHCA)

Public Utility Regulatory Policies Act of 1978 (PURPA)

Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA)

Information Technology Management Reform Act of 1996 (ITMRA/Clinger-Cohen Act)

NATURAL GAS STATUTES

Natural Gas Act

Natural Gas Policy Act of 1978

Alaska Natural Gas Pipeline Act of 2004

Energy Policy Act of 2005 (EPAct 2005)

Alaska Natural Gas Transportation Act of 1976

Outer Continental Shelf Lands Act of 1978 (OCSLA)

Natural Gas Wellhead Decontrol Act of 1989 (NGWDA)

OIL STATUTES

Interstate Commerce Act

Energy Policy Act of 1992

ENVIRONMENTAL AND OTHER STATUTES

Clean Air Act

Clean Water Act

Rivers and Harbors Act

Endangered Species Act

Wild and Scenic Rivers Act

Coastal Zone Management Act

National Historic Preservation Act

Fish and Wildlife Coordination Act

National Environmental Policy Act (NEPA)

APPENDIX E

STATUTORY AUTHORITY 
Federal Energy Regulatory Commission

43

APPENDIX F

SUMMARY OF STRATEGIC PLAN CHANGES

Goal 1: Just and Reasonable Rates, Terms and Conditions

Objective 1.1: Regulatory & Market Means

Strategy 3: Develop and implement a common set of performance metrics for markets within and 

outside of ISOs/RTOs

Change: Adjust the timing of Annual Performance Targets

Explanation of Change

In FYs 2010 and 2011, the Commission collaborated with RTOs, ISOs and various stakeholder groups to develop operational and financial metrics to gauge the performance of markets within RTOs and ISOs. Beginning in FY 2011 and 

continuing in FY 2012, the Commission has been working with utilities in non-ISO/RTO regions and their stakeholders 

to develop similar metrics. Due to the extensive outreach with stakeholders, this voluntary and collaborative process has 

taken longer than anticipated for each of these groups. Consequently, the Commission is deferring the implementation 

dates of its annual performance targets by one year.

The Commission is working to complete the metrics for non-ISO/RTO utilities in FY 2012. In FY 2013, the Commission 

will use both sets of performance metrics to establish appropriate common metrics between the two groups, refining the 

metrics as necessary in FY 2014.

LONG TERM PERFORMANCE GOAL:

By FY 2014, the performance of markets within and outside of ISOs/RTOs will be measured using a common set of metrics.

ORIGINAL ANNUAL PERFORMANCE TARGETS:

FY 2010: Explore and develop appropriate operational and financial metrics for ISOs/RTOs

FY 2011: Explore and develop appropriate operational and financial metrics for non-ISO/ RTO regions

FY 2012: Establish appropriate common metrics between ISOs/RTOs and non-ISOs/RTOs

FY 2013: Monitor implementation and performance

FY 2014: Evaluate performance and seek changes as necessary
The Strategic Plan FY 2009-2014 

44

Goal 1: Just and Reasonable Rates, Terms and Conditions

Objective 1.1: Regulatory & Market Means

Strategy 4: Promote broad participation, including the use of alternative dispute resolution services, 

in the Commission’s processes and procedures

Change: Adjust the timing of Annual Performance Targets

Explanation of Change:

In FYs 2010 and 2011, the entire senior leadership responsible for implementing this strategy retired. New leadership is 

in place; however, this transition caused a delay in fully executing the steps necessary to meet the annual performance 

targets. In order to reflect a more realistic schedule, the Commission is deferring the implementation dates of the targets 

by one year and consolidating the FYs 2013 and 2014 targets into a single FY 2014 target. The Commission remains committed to alternative dispute resolution and collaborative processes and looks forward to implementing this strategy.

LONG TERM PERFORMANCE GOAL:

By FY 2014, appropriate filings and issues will employ alternative dispute resolution and collaborative processes first.

ORIGINAL ANNUAL PERFORMANCE TARGETS:

FY 2010: Develop guidelines/tariff provisions to apply to filings/issues amenable to consensual resolution

FY 2011: Implement rules setting forth guidelines/tariff provisions and initiate pilot programs

FY 2012: Conduct study to determine if pilot program should be expanded

FY 2013: Determine if number of consensual resolutions increased

FY 2014: Evaluate whether additional steps are necessary to achieve appropriate use of ADR and collaborative processes
Federal Energy Regulatory Commission

45

Goal Two: Infrastructure

Objective 2.3: Reliability

Change: Update the Objective Statement

Explanation of Change:

The Objective 2.3 statement has been updated in order to more accurately explain the Commission’s role in maintaining the reliability of the power grid. This does not reflect a change in the Commission’s responsibility or strategies for 

achieving this Objective. 

ORIGINAL OBJECTIVE STATEMENT

Maintain the reliability of the electric grid.

Change: Update Strategy 3

Explanation of Change:

Strategy 3 has been revised to reflect the Commission’s goal of reducing carbon and increasing the penetration of renewable energy resources on the nation-wide electric transmission grid. The Strategy 3 narrative text was also updated to 

capture the current status of the Commission’s activities.

ORIGINAL STRATEGY STATEMENT

Identify reliability parameters that affect national goals of reducing carbon and increasing the penetration of renewable 

energy resources on the electric transmission grid

ORIGINAL LONG TERM PERFORMANCE GOAL STATEMENT

By FY 2014, reliability parameters that could affect national goals of reducing carbon and increasing the penetration of 

renewable energy resources on the electric transmission grid will be finalized.

ORIGINAL NARRATIVE TEXT

The President and Members of Congress are currently drafting and proposing policies and legislation to advance renewable energy and drive clean energy production. In FY 2010, Commission staff will establish processes to track studies that 

are related to the developments of reliability parameters associated with the integration of these initiatives. Using this 

data, the Commission will perform analyses to see if these reliability parameters are feasible for the bulk power system. 

In subsequent years, more detailed analysis will be performed and documented to determine if the selected reliability 

parameters are feasible. The Commission also will seek input from industry and will coordinate and work with other 

government agencies to identify reliability issues that affect the national goals of reducing carbon and increasing the 

penetration of renewable energy resources.
The Strategic Plan FY 2009-2014 

46

The Commission’s strategy to identify these reliability parameters includes: tracking current, past and future studies 

performed in the interconnections, regions, ISOs, RTOs, 

international arena and state commissions; participating in 

industry groups in the areas of renewable energy resources, 

carbon-based generation, and carbon sequestration; researching legislation and regulation in the U.S. and in the international arena to gauge the success of similar or proposed 

reliability parameters; tracking equipment and developing 

technologies on the products that impact a particular reliability parameter; and developing, analyzing and presenting proposals to form the basis of a study that will identify 

reliability parameters by using the expertise in the Commission, industry, educational institutions and the Department 

of Energy’s National Labs.
Federal Energy Regulatory Commission

47

FERC RESPONSIBILITIES

¤ What FERC Does:

• Regulates the transmission and wholesale sales of electricity in interstate commerce

• Reviewscertain mergersand acquisitionsand corporatetransactions by electricity

companies

• Regulates thetransportation and sale of natural gas for resalein interstatecommerce

• Regulates thetransportation of oil by pipelinein interstatecommerce

• Approves thesiting and abandonment of interstate natural gas pipelinesand

storage facilities

• Reviews siting applications forelectrictransmission projects under limited circumstances

• Ensures thesafe operation and reliability of proposed and operating LNG terminals

• Licensesand inspects private, municipaland state hydroelectric projects

• Protects thereliability of the high voltageinterstatetransmission system through

mandatory reliability standards

• Monitorsand investigatesenergy markets

• Enforces FERC regulatory requirements through imposition ofcivil penaltiesand

other means

• Overseesenvironmental matters related to natural gasand hydroelectricity projects

and other matters

• Administersaccounting and financial reporting regulations and conduct of regulated 

companies

¤ What FERC Does Not Do:

Many areas outside of FERC’s jurisdictional responsibility are dealt with by state public 

utility commissions. Areas considered outside of FERC’s responsibility include:

• Regulation of retail electricity and natural gas sales to consumers

• Approval for the physicalconstruction ofelectric generation facilities

• Regulation of mostactivities of stateand municipal power systems, federal power marketing agencies like the Tennessee Valley Authority, and most rural electric cooperatives

• Regulation of nuclear power plants

•Issuance of state water quality certificates

• Oversight for theconstruction of oil pipelines

• Abandonment of serviceas related to oil facilities

• Mergersand acquisitionsas related to natural gasand oilcompanies

• Responsibility for pipelinesafety or for pipelinetransportation on oracross the

Outer Continental Shelf

• Regulation of local distribution ofelectricity and natural gas

• Developmentand operation of natural gas vehicles

• Reliability problems related to failures of local distribution facilities

• Treetrimming near local distribution power lines in residential neighborhoods
For additional information on the 

Strategic Plan, please contact:

Office of the Executive Director

888 First Street, NE

Washington, DC 20426

202.502.8300

1.866.208.3372 (Toll-free)

customer@ferc.gov

www.FERC.gov

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