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[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4941 Introduced in House (IH)]

106th CONGRESS
  2d Session
                                H. R. 4941

 To amend the Federal Power Act to provide for the reliability of the 
electric power transmission system in the United States, and for other 
                               purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                             July 24, 2000

 Mr. Wynn (for himself, Mr. Shadegg, Mr. Pallone, Mr. Bilbray, and Ms. 
    Eshoo) introduced the following bill; which was referred to the 
                         Committee on Commerce

_______________________________________________________________________

                                 A BILL

 
 To amend the Federal Power Act to provide for the reliability of the 
electric power transmission system in the United States, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``National Electric Reliability Act''.

SEC. 2. ELECTRIC ENERGY TRANSMISSION RELIABILITY.

    (a) Electric Reliability Organization and Oversight.--
            (1) In general.--The Federal Power Act is amended by adding 
        the following new section after section 214:

``SEC. 215. ELECTRIC RELIABILITY ORGANIZATION AND OVERSIGHT.

    ``(a) Definitions.--As used in this section:
            ``(1) Affiliated regional reliability entity.--The term 
        `affiliated regional reliability entity' means an entity 
        delegated authority under the provisions of subsection (h).
            ``(2) Bulk-power system.--The term `bulk-power system' 
        means all facilities and control systems necessary for 
        operating an interconnected transmission grid (or any portion 
        thereof), including high-voltage transmission lines; 
        substations; control centers; communications; data, and 
        operations planning facilities; and the output of generating 
        units necessary to maintain transmission system reliability.
            ``(3) Electric reliability organization, or organization.--
        The term `Electric Reliability Organization' or `Organization' 
        means the organization approved by the Commission under 
        subsection (d)(4).
            ``(4) Entity rule.--The term `entity rule' means a rule 
        adopted by an affiliated regional reliability entity for a 
        specific region and designed to implement or enforce one or 
        more Organization Standards. An entity rule shall be approved 
        by the organization and once approved, shall be treated as an 
        Organization Standard.
            ``(5) Industry sector.--The term `industry sector' means a 
        group of users of the bulk power system with substantially 
        similar commercial interests, as determined by the Board of the 
        Electric Reliability Organization.
            ``(6) Interconnection.--The term `interconnection' means a 
        geographic area in which the operation of bulk-power system 
        components is synchronized such that the failure of one or more 
        of such components may adversely affect the ability of the 
        operators of other components within the interconnection to 
        maintain safe and reliable operation of the facilities within 
        their control.
            ``(7) Organization standard.--The term `Organization 
        Standard' means a policy or standard duly adopted by the 
        Electric Reliability Organization to provide for the reliable 
        operation of a bulk-power system.
            ``(8) Public interest group.--The term `public interest 
        group' means any nonprofit private or public organization that 
        has an interest in the activities of the Electric Reliability 
        Organization, including, but not limited to, ratepayer 
        advocates, environmental groups, and State and local government 
        organizations that regulate market participants and promulgate 
        government policy.
            ``(9) Variance.--The term `variance' means an exception or 
        variance from the requirements of an Organization Standard 
        (including a proposal for an Organization Standard where there 
        is no Organization Standard) that is adopted by an affiliated 
        regional reliability entity and applicable to all or a part of 
        the region for which the affiliated regional reliability entity 
        is responsible. A variance shall be approved by the 
        organization and once approved, shall be treated as an 
        Organization Standard.
            ``(10) System operator.--The term `system operator' means 
        any entity that operates or is responsible for the operation of 
        a bulk-power system, including but not limited to a control 
        area operator, an independent system operator, a regional 
        transmission organization, a transmission company, a 
        transmission system operator, or a regional security 
        coordinator.
            ``(11) User of the bulk-power system.--The term `user of 
        the bulk-power system' means any entity that sells, purchases, 
        or transmits electric power over a bulk-power system, or that 
        owns, operates, or maintains facilities or control systems that 
        are part of a bulk-power system, or that is a system operator.
    ``(b) Commission Authority.--(1) Within the United States, the 
Commission shall have jurisdiction over the Electric Reliability 
Organization, all affiliated regional reliability entities, all system 
operators, and all users of the bulk-power system, for purposes of 
approving and enforcing compliance with the requirements of this 
section.
    ``(2) The Commission may, by rule, define any other term used in 
this section, provided such definition is consistent with the 
definitions in, and the purpose and intent of, this Act.
    ``(3) Not later than 90 days after the date of enactment of this 
section, the Commission shall issue a proposed rule for implementing 
the requirements of this section. The Commission shall provide notice 
and opportunity for comment on the proposed rule. The Commission 
shall issue a final rule under this subsection within 180 days after 
the date of enactment of this section.
    ``(4) Nothing in this section shall be construed as limiting or 
impairing any authority of the Commission under any other provision of 
this Act, including its exclusive authority to determine rates, terms, 
and conditions of transmission services subject to its jurisdiction.
    ``(c) Existing Reliability Standards.--Following enactment of this 
section, and prior to the approval of an organization under subsection 
(d), any entity, including the North American Electric Reliability 
Council and its member regional reliability councils, may file any 
reliability standard, guidance, or practice that such entity would 
propose to be made mandatory and enforceable. The Commission, after 
allowing an opportunity to submit comments, may approve any such 
proposed mandatory standard, guidance, or practice, or any amendment 
thereto, if it finds that the standard, guidance, or practice, or 
amendment is just, reasonable, not unduly discriminatory or 
preferential, and in the public interest. The Commission may, without 
further proceeding or finding, grant its approval to any standard, 
guidance, or practice for which no substantive objections are filed in 
the comment period. Filed standards, guidances, or practices, including 
any amendments thereto, shall be mandatory and applicable according to 
their terms following approval by the Commission and shall remain in 
effect until (1) withdrawn, disapproved, or superseded by an 
Organization Standard, issued or approved by the Electric Reliability 
Organization and made effective by the Commission under subsection (e); 
or (2) disapproved by the Commission if, upon complaint or upon its own 
motion and after notice and an opportunity for comment, the Commission 
finds the standard, guidance, or practice unjust, unreasonable, unduly 
discriminatory, or preferential or not in the public interest. 
Standards, guidances, or practices in effect pursuant to the provisions 
of this subsection shall be enforceable by the Commission.
    ``(d) Organization Approval.--(1) Following the issuance of a final 
Commission rule under subsection (b)(3), an entity may submit an 
application to the Commission for approval as the Electric Reliability 
Organization. The applicant shall specify in its application its 
governance and procedures, as well as its funding mechanism and initial 
funding requirements.
    ``(2) The Commission shall provide public notice of the application 
and afford interested parties an opportunity to comment.
    ``(3) The Commission shall approve the application if the 
Commission determines that the applicant--
            ``(A) has the ability to develop, implement, and enforce 
        standards that provide for an adequate level of reliability of 
        the bulk-power system;
            ``(B) permits voluntary membership to any user of the bulk-
        power system or public interest group;
            ``(C) assures fair representation of its members in the 
        selection of its directors and fair management of its affairs, 
        taking into account the need for efficiency and effectiveness 
        in decisionmaking and operations and the requirements for 
        technical competency in the development of Organization 
        Standards and the exercise of oversight of bulk-power system 
        reliability;
            ``(D) assures that no two industry sectors have the ability 
        to control, and no one industry sector has the ability to veto, 
        the Electric Reliability Organization's discharge of its 
        responsibilities (including actions by committees recommending 
        standards to the board or other board actions to implement and 
        enforce standards);
            ``(E) provides for governance by a board wholly comprised 
        of independent directors;
            ``(F) provides a funding mechanism and requirements that 
        are just, reasonable, and not unduly discriminatory or 
        preferential and are in the public interest, and which satisfy 
        the requirements of subsection (l);
            ``(G) establishes procedures for development of 
        Organization Standards that provide reasonable notice and 
        opportunity for public comment, taking into account the need 
        for efficiency and effectiveness in decisionmaking and 
        operations and the requirements for technical competency in the 
        development of Organization Standards, and which standards 
        development process has the following attributes:
                    ``(i) openness,
                    ``(ii) balance of interests, and
                    ``(iii) due process, except that the procedures may 
                include alternative procedures for emergencies;
            ``(H) establishes fair and impartial procedures for 
        implementation and enforcement of Organization Standards, 
        either directly or through delegation to an affiliated regional 
        reliability entity, including the imposition of penalties, 
        limitations on activities, functions, or operations, or other 
        appropriate sanctions;
            ``(I) establishes procedures for notice and opportunity for 
        public observation of all meetings, except that the procedures 
        for public observation may include alternative procedures for 
        emergencies or for the discussion of information the directors 
        determine should take place in closed session, such as 
        litigation, personnel actions, or commercially sensitive 
        information;
            ``(J) provides for the consideration of recommendations of 
        States and State commissions; and
            ``(K) addresses other matters that the Commission may deem 
        necessary or appropriate to ensure that the procedures, 
        governance, and funding of the Electric Reliability 
        Organization are just, reasonable, not unduly discriminatory or 
        preferential, and are in the public interest.
    ``(4) The Commission shall approve only one Electric Reliability 
Organization. If the Commission receives two or more timely 
applications that satisfy the requirements of this subsection, the 
Commission shall approve only the application it concludes will best 
implement the provisions of this section.
    ``(e) Establishment of and Modifications to Organization 
Standards.--(1) The Electric Reliability Organization shall file with 
the Commission any new or modified organization standards, including 
any variances or entity rules, and the Commission shall follow the 
procedures under paragraph (2) for review of that filing.
    ``(2) Submissions under paragraph (1) shall include--
            ``(A) a concise statement of the purpose of the proposal, 
        and
            ``(B) a record of any proceedings conducted with respect to 
        such proposal.
The Commission shall provide notice of the filing of such proposal and 
afford interested entities 30 days to submit comments. The Commission, 
after taking into consideration any submitted comments, shall approve 
or disapprove such proposal not later than 60 days after the deadline 
for the submission of comments, except that the Commission may extend 
the 60-day period for an additional 90 days for good cause, and except 
further that if the Commission does not act to approve or disapprove a 
proposal within the foregoing periods, the proposal shall go into 
effect subject to its terms, without prejudice to the authority of the 
Commission thereafter to modify the proposal in accordance with the 
standards and requirements of this section. Proposals approved by the 
Commission shall take effect according to their terms but not earlier 
than 30 days after the effective date of the Commission's order, except 
as provided in paragraph (3) of this subsection.
    ``(3)(A) In the exercise of its review responsibilities under this 
subsection, the Commission shall give due weight to the technical 
expertise of the Electric Reliability Organization with respect to the 
content of a new or modified organization standard, but shall not defer 
to the organization with respect to the effect of the standard on 
competition. The Commission shall approve a proposed new or modified 
organization standard if it determines the proposal to be just, 
reasonable, not unduly discriminatory or preferential, and in the 
public interest.
    ``(B) An existing or proposed organization standard which is 
disapproved in whole or in part by the Commission shall be remanded to 
the Electric Reliability Organization for further consideration.
    ``(C) The Commission, on its own motion or upon complaint, may 
direct the Electric Reliability Organization to develop an organization 
standard, including modification to an existing organization standard, 
addressing a specific matter by a date certain if the Commission 
considers such new or modified organization standard necessary or 
appropriate to further the purposes of this section. The Electric 
Reliability Organization shall file any such new or modified 
organization standard in accordance with this subsection.
    ``(D) An affiliated regional reliability entity may propose a 
variance or entity rule to the Electric Reliability Organization. The 
affiliated regional reliability entity may request that the Electric 
Reliability Organization expedite consideration of the proposal, and 
may file a notice of such request with the Commission, if expedited 
consideration is necessary to provide for bulk-power system 
reliability. If the Electric Reliability Organization fails to adopt 
the variance or entity rule, either in whole or in part, the affiliated 
regional reliability entity may request that the Commission review such 
action. If the Commission determines, after its review of such a 
request, that the action of the Electric Reliability Organization did 
not conform to the applicable standards and procedures approved by the 
Commission, or if the Commission determines that the variance or entity 
rule is just, reasonable, not unduly discriminatory or preferential, 
and in the public interest, and that the Electric Reliability 
Organization has unreasonably rejected the proposed variance or entity 
rule, then the Commission may remand the proposed variance or entity 
rule for further consideration by the Electric Reliability Organization 
or may direct the Electric Reliability Organization or the affiliated 
regional reliability entity to develop a variance or entity rule 
consistent with that requested by the affiliated regional reliability 
entity. Any such variance or entity rule proposed by an affiliated 
regional reliability entity shall be submitted to the Electric 
Reliability Organization for review and filing with the Commission in 
accordance with the procedures specified in this subsection.
    ``(E) Notwithstanding any other provision of this subsection, a 
proposed organization standard or amendment shall take effect according 
to its terms if the Electric Reliability Organization determines that 
an emergency exists requiring that such proposed organization standard 
or amendment take effect without notice or comment. The Electric 
Reliability Organization shall notify the Commission immediately 
following such determination and shall file such emergency organization 
standard or amendment with the Commission not later than 5 days 
following such determination and shall include in such filing an 
explanation of the need for such emergency standard. Subsequently, the 
Commission shall provide notice of the organization standard or 
amendment for comment, and shall follow the procedures set out in 
paragraphs (2) and (3) for review of the new or modified organization 
standard. Any such organization standard that has gone into effect 
shall remain in effect unless and until suspended or disapproved by the 
Commission. If the Commission determines at any time that the emergency 
organization standard or amendment is not necessary, the Commission may 
suspend such emergency organization standard or amendment.
    ``(4) All users of the bulk-power system shall comply with any 
organization standard that takes effect under this section.
    ``(f) Coordination With Canada and Mexico.--The Electric 
Reliability Organization shall take all appropriate steps to gain 
recognition in Canada and Mexico. The United States shall use its best 
efforts to enter into international agreements with the appropriate 
governments of Canada and Mexico to provide for effective compliance 
with organization standards and to provide for the effectiveness of the 
Electric Reliability Organization in carrying out its mission and 
responsibilities. All actions taken by the Electric Reliability 
Organization, any affiliated regional reliability entity, and the 
Commission shall be consistent with the provisions of such 
international agreements.
    ``(g) Changes in Procedures, Governance, or Funding.--(1) The 
Electric Reliability Organization shall file with the Commission any 
proposed change in its procedures, governance, or funding, or any 
changes in the affiliated regional reliability entity's procedures, 
governance, or funding relating to delegated functions, and shall 
include with the filing an explanation of the basis and purpose for the 
change.
    ``(2) A proposed procedural change may take effect 90 days after 
filing with the Commission if the change constitutes a statement of 
policy, practice, or interpretation with respect to the meaning or 
enforcement of an existing procedure. Otherwise, a proposed procedural 
change shall take effect only upon a finding by the Commission, after 
notice and opportunity for comments, that the change is just, 
reasonable, not unduly discriminatory or preferential, is in the public 
interest, and satisfies the requirements of subsection (d)(4).
    ``(3) A change in governance or funding shall not take effect 
unless the Commission finds that the change is just, reasonable, not 
unduly discriminatory or preferential, in the public interest, and 
satisfies the requirements of subsection (d)(4).
    ``(4) The Commission, upon complaint or upon its own motion, may 
require the Electric Reliability Organization to amend the procedures, 
governance, or funding if the Commission determines that the amendment 
is necessary to meet the requirements of this section. The Electric 
Reliability Organization shall file the amendment in accordance with 
paragraph (1) of this subsection.
    ``(h) Delegations of Authority.--(1) The Electric Reliability 
Organization shall, upon request by an entity, enter into an agreement 
with such entity for the delegation of authority to implement and 
enforce compliance with organization standards in a specified 
geographic area if the organization finds that the entity requesting 
the delegation satisfies the requirements of subparagraphs (A), (B), 
(C), (D), (F), (J), and (K) of subsection (d)(4), and if the delegation 
promotes the effective and efficient implementation and administration 
of bulk-power system reliability. The Electric Reliability Organization 
may enter into an agreement to delegate to the entity any other 
authority, except that the Electric Reliability Organization shall 
reserve the right to set and approve standards for bulk-power system 
reliability.
    ``(2) The Electric Reliability Organization shall file with the 
Commission any agreement entered into under this subsection and any 
information the Commission requires with respect to the affiliated 
regional reliability entity to which authority is to be delegated. The 
Commission shall approve the agreement, following public notice and an 
opportunity for comment, if it finds that the agreement meets the 
requirements of paragraph (1), and is just, reasonable, not unduly 
discriminatory or preferential, and is in the public interest. A 
proposed delegation agreement with an affiliated regional reliability 
entity organized on an interconnection-wide basis shall be rebuttably 
presumed by the Commission to promote the effective and efficient 
implementation and administration of bulk-power system reliability. No 
delegation by the Electric Reliability Organization shall be valid 
unless approved by the Commission.
    ``(3)(A) A delegation agreement entered into under this subsection 
shall specify the procedures for an affiliated regional reliability 
entity to propose entity rules or variances for review by the Electric 
Reliability Organization. With respect to any such proposal that would 
apply on an interconnection-wide basis, the Electric Reliability 
Organization shall presume such proposal valid if made by an 
interconnection-wide affiliated regional reliability entity unless the 
Electric Reliability Organization makes a written finding that the 
proposal--
            ``(i) was not developed in a fair and open process that 
        provided an opportunity for all interested parties to 
        participate;
            ``(ii) has a significant adverse impact on reliability or 
        commerce in other interconnections;
            ``(iii) fails to provide a level of reliability of the 
        bulk-power system within the interconnection such that it would 
        constitute a serious and substantial threat to public health, 
        safety, welfare, or national security; or
            ``(iv) creates a serious and substantial burden on 
        competitive markets within the interconnection that is not 
        necessary for reliability.
    ``(B) With respect to any such proposal that would apply only to 
part of an interconnection, the Electric Reliability Organization shall 
find such proposal valid if the affiliated regional reliability entity 
or entities making the proposal demonstrate that it--
            ``(i) was developed in a fair and open process that 
        provided an opportunity for all interested parties to 
        participate;
            ``(ii) would not have an adverse impact on commerce that is 
        not necessary for reliability;
            ``(iii) provides a level of bulk-power system reliability 
        adequate to protect public health, safety, welfare, and 
        national security, and would not have a significant adverse 
        impact on reliability; and
            ``(iv) in the case of a variance, is based on legitimate 
        differences between regions or between subregions within the 
        affiliated regional reliability entity's geographic area.
The Electric Reliability Organization shall approve or disapprove such 
proposal within 120 days, or the proposal shall be deemed approved. 
Following approval of any such proposal under this paragraph, the 
Electric Reliability Organization shall seek Commission approval 
pursuant to the procedures prescribed under subsection (e)(3). 
Affiliated regional reliability entities may not make requests for 
approval directly to the Commission except pursuant to subsection 
(e)(3)(D).
    ``(4) If an affiliated regional reliability entity requests, 
consistent with paragraph (1) of this subsection, that the Electric 
Reliability Organization delegate authority to it, but is unable within 
180 days to reach agreement with the Electric Reliability Organization 
with respect to such requested delegation, such entity may seek relief 
from the Commission. If, following notice and opportunity for comment, 
the Commission determines that a delegation to the entity would meet 
the requirements of paragraph (1) above, and that the delegation would 
be just, reasonable, not unduly discriminatory or preferential, and in 
the public interest, and that the Electric Reliability Organization has 
unreasonably withheld such delegation, the Commission may, by order, 
direct the Electric Reliability Organization to make such delegation.
    ``(5)(A) The Commission may, upon its own motion or upon complaint, 
and with notice to the appropriate affiliated regional reliability 
entity or entities, direct the Electric Reliability Organization to 
propose a modification to an agreement entered into under this 
subsection if the Commission determines that--
            ``(i) the affiliated regional reliability entity no longer 
        has the capacity to carry out effectively or efficiently its 
        implementation or enforcement responsibilities under that 
        agreement, has failed to meet its obligations under that 
        agreement, or has violated any provision of this section;
            ``(ii) the rules, practices, or procedures of the 
        affiliated regional reliability entity no longer provide for 
        fair and impartial discharge of its implementation or 
        enforcement responsibilities under the agreement;
            ``(iii) the geographic boundary of a transmission entity 
        approved by the Commission is not wholly within the boundary of 
        an affiliated regional reliability entity and such difference 
        is inconsistent with the effective and efficient implementation 
        and administration of bulk-power system reliability; or
            ``(iv) the agreement is inconsistent with another 
        delegation agreement as a result of actions taken under 
        paragraph (4) of this subsection.
    ``(B) Following an order of the Commission issued under 
subparagraph (A), the Commission may suspend the affected agreement if 
the Electric Reliability Organization or the affiliated regional 
reliability entity does not propose an appropriate and timely 
modification. If the agreement is suspended, the Electric Reliability 
Organization shall assume the previously delegated responsibilities. 
The Commission shall allow the Electric Reliability Organization and 
the affiliated regional reliability entity an opportunity to appeal the 
suspension.
    ``(i) Organization Membership.--Every system operator shall be 
required to be a member of the Electric Reliability Organization and 
shall be required also to be a member of any affiliated regional 
reliability entity operating under an agreement effective pursuant to 
subsection (h) applicable to the region in which the system operator 
operates or is responsible for the operation of bulk-power system 
facilities.
    ``(j) Injunctions and Disciplinary Action.--(1) Consistent with the 
range of actions approved by the Commission under subsection (d)(4)(H), 
the Electric Reliability Organization may impose a penalty, limitation 
of activities, functions, operations, or other disciplinary action the 
Electric Reliability Organization finds appropriate against a user of 
the bulk-power system if the Electric Reliability Organization, after 
notice and an opportunity for interested parties to be heard, issues a 
finding in writing that the user of the bulk-power system has violated 
an organization standard. The Electric Reliability Organization shall 
immediately notify the Commission of any disciplinary action imposed 
with respect to an act or failure to act of a user of the bulk-power 
system that affected or threatened to affect bulk-power system 
facilities located in the United States, and the sanctioned party shall 
have the right to seek modification or rescission of such disciplinary 
action by the Commission. If the organization finds it necessary to 
prevent a serious threat to reliability, the organization may seek 
injunctive relief in a Federal court in the district in which the 
affected facilities are located.
    ``(2) A disciplinary action taken under paragraph (1) may take 
effect not earlier than the 30th day after the Electric Reliability 
Organization files with the Commission its written finding and record 
of proceedings before the Electric Reliability Organization and the 
Commission posts its written finding, unless the Commission, on its own 
motion or upon application by the user of the bulk-power system which 
is the subject of the action, suspends the action. The action shall 
remain in effect or remain suspended unless and until the Commission, 
after notice and opportunity for hearing, affirms, sets aside, 
modifies, or reinstates the action, but the Commission shall 
conduct such hearing under procedures established to ensure expedited 
consideration of the action taken.
    ``(3) The Commission, on its own motion or on complaint, may order 
compliance with an organization standard and may impose a penalty, 
limitation of activities, functions, or operations, or take such other 
disciplinary action as the Commission finds appropriate, against a user 
of the bulk-power system with respect to actions affecting or 
threatening to affect bulk-power system facilities located in the 
United States if the Commission finds, after notice and opportunity for 
a hearing, that the user of the bulk-power system has violated or 
threatens to violate an organization standard.
    ``(4) The Commission may take such action as is necessary against 
the Electric Reliability Organization or an affiliated regional 
reliability entity to assure compliance with an organization standard, 
or any Commission order affecting the Electric Reliability Organization 
or an affiliated regional reliability entity.
    ``(k) Reliability Reports.--The Electric Reliability Organization 
shall conduct periodic assessments of the reliability and adequacy of 
the interconnected bulk-power system in North America and shall report 
annually to the Secretary of Energy and the Commission its findings and 
recommendations for monitoring or improving system reliability and 
adequacy.
    ``(l) Assessment and Recovery of Certain Costs.--The reasonable 
costs of the Electric Reliability Organization, and the reasonable 
costs of each affiliated regional reliability entity that are related 
to implementation and enforcement of organization standards or other 
requirements contained in a delegation agreement approved under 
subsection (h), shall be assessed by the Electric Reliability 
Organization and each affiliated regional reliability entity, 
respectively, taking into account the relationship of costs to each 
region and based on an allocation that reflects an equitable sharing of 
the costs among all end users. The Commission shall provide by rule for 
the review of such costs and allocations, pursuant to the standards in 
this subsection and subsection (d)(4)(F).
    ``(m) Savings Provisions.--(1) The Electric Reliability 
Organization shall have authority to develop, implement and enforce 
compliance with standards for the reliable operation of only the Bulk 
Power System.
    ``(2) This section does not provide the Electric Reliability 
Organization or the Commission with the authority to set and enforce 
compliance with standards for adequacy or safety of electric facilities 
or services.
    ``(3) Nothing in this section shall be construed to preempt any 
authority of any State to take action to ensure the safety, adequacy, 
and reliability of electric service within that State, as long as such 
action is not inconsistent with any Organization Standard.
    ``(4) Within 90 days of the application of the Electric Reliability 
Organization or other affected party, the Commission shall issue a 
final order determining whether a state action is inconsistent with an 
Organization Standard, after notice and opportunity for comment, taking 
into consideration any recommendations of the Electric Reliability 
Organization.
    ``(5) The Commission, after consultation with the Electric 
Reliability Organization, may stay the effectiveness of any state 
action, pending the Commission's issuance of a final order.
    ``(n) Regional Advisory Bodies.--The Commission shall establish a 
regional advisory body on the petition of at least two-thirds of the 
States within a region that have more than one-half of their electric 
loan served within the region. A regional advisory body shall be 
composed of one member from each participating State in the region, 
appointed by the Governor of each State, and may include 
representatives of agencies, States, and provinces outside the United 
States, upon execution of an international agreement or agreements 
described in subsection (f). A regional advisory body may provide 
advice to the electric reliability organization, an affiliated regional 
reliability entity, or the Commission regarding the governance of an 
existing or proposed affiliated regional reliability entity within the 
same region, whether an organization standard, entity rule, or variance 
proposed to apply within the region is just, reasonable, not unduly 
discriminatory or preferential, and in the public interest, and whether 
fees proposed to be assessed within the region are just, reasonable, 
not unduly discriminatory or preferential, in the public interest, and 
consistent with the requirements of subsection (l). The Commission may 
give deference to the advice of any such regional advisory body if that 
body is organized on an interconnection-wide basis.
    ``(o) Coordination With Regional Transmission Organizations.--(1) 
Each regional transmission organization authorized by the Commission 
shall be responsible for maintaining the short-term reliability of the 
bulk-power system that it operates, consistent with organization 
standards.
    ``(2) Except as provided in paragraph (5), in connection with a 
proceeding under subsection (e) to consider a proposed organization 
standard, each regional transmission organization authorized by the 
Commission shall report to the Commission, and notify the electric 
reliability organization and any applicable affiliated regional 
reliability entity, regarding whether the proposed organization 
standard hinders or conflicts with that regional transmission 
organization's ability to fulfill the requirements of any Commission-
accepted, approved, or ordered rule, regulation, order, tariff, rate 
schedule, or agreement. Where such hindrance or conflict is identified, 
the Commission shall address such hindrance or conflict, and the need 
for any changes to such Commission-accepted, approved, or ordered rule, 
order, tariff, rate schedule, or agreement in its order under 
subsection (e) regarding the proposed standard. Where such hindrance or 
conflict is identified between a proposed organization standard and a 
provision of any rule, order, tariff, rate schedule or agreement 
accepted, approved or ordered by the Commission applicable to a 
regional transmission organization, nothing in this section shall 
require a change in the regional transmission organization's obligation 
to comply with such provision unless the Commission orders such a 
change and the change becomes effective. If the Commission finds that 
the tariff, rate schedule, or agreement needs to be changed, the 
regional transmission organization must expeditiously make a section 
205 filing to reflect the change. If the Commission finds that the 
proposed organization standard needs to be changed, it shall remand the 
proposed organization standard to the electric reliability organization 
under subsection (e)(3)(B).
    ``(3) Except as provided in paragraph (5), to the extent hindrances 
and conflicts arise after approval of a reliability standard under 
subsection (c) or organization standard under subsection (e), each 
regional transmission organization authorized by the Commission shall 
report to the Commission, and notify the electric reliability 
organization and any applicable affiliated regional reliability entity, 
regarding any reliability standard approved under subsection (c) or 
organization standard that hinders or conflicts with that regional 
transmission organization's ability to fulfill the requirements of any 
Commission-accepted, approved, or ordered rule, regulation, order, 
tariff, rate schedule, or agreement. The Commission shall seek to 
assure that such hindrances or conflicts are resolved promptly. Where a 
hindrance or conflict is identified between a reliability standard or 
an organization standard and a provision of any rule, order, tariff, 
rate schedule or agreement accepted, approved or ordered by the 
Commission applicable to a regional reliability organization, nothing 
in this section shall require a change in the regional transmission 
organization's obligation to comply with such provision unless the 
Commission orders such a change and the change becomes effective. If 
the Commission finds that the tariff, rate schedule or agreement needs 
to be changed, the regional transmission organization must 
expeditiously make a section 205 filing to reflect the change. If the 
Commission finds that an organization standard needs to be changed, it 
shall order the electric reliability organization to develop and submit 
a modified organization standard under subsection (e)(3)(C).
    ``(4) An affiliated regional reliability entity and a regional 
transmission organization operating in the same geographic area shall 
cooperate to avoid conflicts between implementation and enforcement of 
organization standards by the affiliated regional reliability entity 
and implementation and enforcement of Commission-accepted tariffs, rate 
schedules, and agreements by the regional transmission organization. In 
areas without an affiliated regional reliability entity, the electric 
reliability organization shall act as the affiliated regional 
reliability entity for purposes of this paragraph.
    ``(5) Until 6 months after approval of applicable subsection (h)(3) 
procedures, any reliability standard, guidance, or practice contained 
in Commission-accepted tariffs, rate schedules, or agreements in effect 
of any Commission-authorized independent system operator or regional 
transmission organization shall continue to apply unless the Commission 
accepts an amendment thereto by the applicable operator or 
organization, or upon complaint finds them to be unjust, unreasonable, 
unduly discriminatory or preferential, or not in the public interest. 
At the conclusion of such transition period, any such reliability 
standard, guidance, practice, or amendment thereto that the Commission 
determines is inconsistent with organization standards shall no longer 
apply.''.
            (2) Enforcement.--Sections 316 and 316A of the Federal 
        Power Act are each amended by striking ``or 214'' each place it 
        appears and inserting ``214, or 215''.
    (b) Application of Antitrust Laws.--Notwithstanding any other 
provision of law, each of the following activities are rebuttably 
presumed to be in compliance with the antitrust laws of the United 
States:
            (1) Activities undertaken by the Electric Reliability 
        Organization under section 215 of the Federal Power Act or 
        affiliated regional reliability entity operating under an 
        agreement in effect under section 215(h) of such Act.
            (2) Activities of a member of the Electric Reliability 
        Organization or affiliated regional reliability entity in 
        pursuit of organization objectives under section 215 of the 
        Federal Power Act undertaken in good faith under the rules of 
        the organization.
Primary jurisdiction, and immunities and other affirmative defenses, 
shall be available to the extent otherwise applicable.
                                 <all>
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