133 FERC ¶ 61,234 

UNITED STATES OF AMERICA 

FEDERAL ENERGY REGULATORY COMMISSION 

18 CFR Part 40 

Docket No. RM10-8-000 

Electric Reliability Organization Interpretations of Interconnection Reliability Operations 

and Coordination and Transmission Operations Reliability Standards 

(Issued December 16, 2010) 

AGENCY: Federal Energy Regulatory Commission. 

ACTION: Notice of Proposed Rulemaking. 

SUMMARY: Under section 215 of the Federal Power Act (FPA), the Federal Energy 

Regulatory Commission (Commission) proposes to approve the North American Electric 

Reliability Corporation’s (NERC) proposed interpretation of certain specific 

requirements of the Commission-approved Reliability Standards, TOP-005-1, 

Operational Reliability Information, and IRO-005-1, Reliability Coordination – CurrentDay Operations. Specifically, the interpretation addresses whether a Special Protection 

System (or SPS) that is operating with only one communication channel in service is 

“degraded” under these standards. The Commission proposes to approve the 

interpretation, discussed below, as being consistent with and not expanding or changing 

the existing Reliability Standards. However, to address Commission concerns that the 

interpretation fails to specify that a Special Protection System that has lost a 

communication channel be reported, the Commission also proposes to direct NERC 

pursuant to section 215 (d)(5) of the FPA to develop modifications to the TOP-005-1 and 
Docket No. RM10-8-000 - ii - 

IRO-005-1 Reliability Standards, as discussed below, through its Reliability Standards 

development process. The Commission seeks comments on its proposal. 

DATES: Comments are due [Insert_Date that is 45 days after publication in the

FEDERAL REGISTER]. 

ADDRESSES: You may submit comments, identified by docket number and in 

accordance with the requirements posted on the Commission’s web site, 

http://www.ferc.gov. Comments may be submitted by any of the following methods: 

 Agency Web Site: Documents created electronically using word processing 

software should be filed in native applications or print-to-PDF format, and not in a 

scanned format, at http://www.ferc.gov/docs-filing/efiling.asp. 

 Mail/Hand Delivery: Commenters unable to file comments electronically must 

mail or hand deliver an original copy of their comments to: Federal Energy 

Regulatory Commission, Secretary of the Commission, 888 First Street, NE, 

Washington, DC 20426. These requirements can be found on the Commission’s 

website; see, e.g., the “Quick Reference Guide for Paper Submissions,” available 

at http://www.ferc.gov/docs-filing/efiling.asp or via phone from FERC Online 

Support at 202-502-6652 or toll-free at 1-866-208-3676. 

FOR FURTHER INFORMATION CONTACT: 

Danny Johnson (Technical Information) 

Office of Electric Reliability 

Federal Energy Regulatory Commission 

888 First Street, NE 

Washington, DC 20426 

Telephone: (202) 502-8892 

danny.johnson@ferc.gov 
Docket No. RM10-8-000 - iii - 

Richard M. Wartchow (Legal Information) 

Office of the General Counsel 

Federal Energy Regulatory Commission 

888 First Street, NE 

Washington, DC 20426 

Telephone: (202) 502-8744 

SUPPLEMENTARY INFORMATION:
133 FERC ¶ 61,234 

UNITED STATES OF AMERICA 

FEDERAL ENERGY REGULATORY COMMISSION 

Electric Reliability Organization Interpretations of 

Interconnection Reliability Operations and Coordination 

and Transmission Operations Reliability Standards 

Docket No. RM10-8-000 

NOTICE OF PROPOSED RULEMAKING 

(Issued December 16, 2010) 

1. Under section 215 of the Federal Power Act (FPA), the Federal Energy Regulatory 

Commission (Commission) proposes to approve the North American Electric Reliability 

Corporation’s (NERC) proposed interpretation of certain specific requirements of the 

Commission-approved Reliability Standards, TOP-005-1, Operational Reliability 

Information, and IRO-005-1, Reliability Coordination – Current-Day Operations.1

 

Specifically, the interpretation addresses whether a Special Protection System (or SPS) 

that is operating with only one communication channel in service is “degraded” under 

these standards. The Commission proposes to approve the interpretation, discussed 

below, as being consistent with and not expanding or changing the existing Reliability 

Standards. However, to address Commission concerns that the interpretation fails to 

specify that a Special Protection System that has lost a communication channel be 

reported, the Commission also proposes to direct NERC pursuant to section 215 (d)(5) of 

 1

 The Commission is not proposing any new or modified text to its regulations. As 

provided in 18 CFR Part 40, proposed Reliability Standards will not become effective 

until approved by the Commission, and the ERO must post on its website each effective 

Reliability Standard. The proposed interpretations would assist entities in complying 

with the Reliability Standards. 
Docket No. RM10-8-000 - 2 - 

the FPA to develop modifications to the TOP-005-1 and IRO-005-1 Reliability 

Standards, as discussed below, through its Reliability Standards development process. 

The Commission seeks comments on its proposal. 

I. Background

A. FPA Section 215 and Mandatory Reliability Standards

2. Section 215 of the FPA requires a Commission-certified Electric Reliability 

Organization (ERO) to develop mandatory and enforceable Reliability Standards, which 

are subject to Commission review and approval. Once approved, the Reliability 

Standards may be enforced by the ERO, subject to Commission oversight, or by the 

Commission independently.2

3. Pursuant to section 215 of the FPA, the Commission established a process to select 

and certify an ERO3

 and, subsequently, certified NERC as the ERO.4 On April 4, 2006, 

as modified on August 28, 2006, NERC submitted to the Commission a petition seeking 

approval of 107 proposed Reliability Standards. On March 16, 2007, the Commission 

issued a Final Rule, Order No. 693, approving 83 of these 107 Reliability Standards and 

 2 See 16 U.S.C. 824o(e)(3). 

3 Rules Concerning Certification of the Electric Reliability Organization; and 

Procedures for the Establishment, Approval and Enforcement of Electric Reliability 

Standards, Order No. 672, FERC Stats. & Regs. ¶ 31,204, order on reh’g, Order 

No. 672-A, FERC Stats. & Regs. ¶ 31,212 (2006). 

4 North American Electric Reliability Corp., 116 FERC ¶ 61,062, order on reh’g 

& compliance, 117 FERC ¶ 61,126 (2006), aff’d sub nom. Alcoa, Inc. v. FERC, 564 F.3d 

1342 (D.C. Cir. 2009). 
Docket No. RM10-8-000 - 3 - 

directing other action related to these Reliability Standards.5

 In addition, pursuant to 

section 215(d)(5) of the FPA, the Commission directed NERC to develop modifications 

to 56 of the 83 approved Reliability Standards.6

4. In Order No. 693, the Commission approved the previous versions of the IRO005-17

 and TOP-005-1 Reliability Standards, directing NERC to develop modifications 

to the standards. For IRO-005-1, the Commission directed NERC to develop 

modifications to the standard in order to include Measures and Levels of NonCompliance specific to interconnection reliability operating limit (IROL) violations 

during normal and contingency conditions.8

 For TOP-005-1, the Commission directed 

NERC to develop a modification to include the operational status of Special Protection 

Systems and power system stabilizers in the types of information that transmission 

operators are expected to share, unless otherwise agreed.9

 NERC reports that its 

 

(continued...) 

5 Mandatory Reliability Standards for the Bulk-Power System, Order No. 693, 

FERC Stats. & Regs. ¶ 31,242, order on reh’g, Order No. 693-A, 120 FERC ¶ 61,053 

(2007). 

6

 16 U.S.C. 824o(d)(5). Section 215(d)(5) provides, “The Commission . . . may 

order the Electric Reliability Organization to submit to the Commission a proposed 

reliability standard or a modification to a reliability standard that addresses a specific 

matter if the Commission considers such a new or modified reliability standard 

appropriate to carry out this section.” 

7

 Order No. 693, FERC Stats. & Regs. ¶ 31,242 at P 945. 

8 Id. P 951. 

9 Id. P 1648 (directing revisions to TOP-005-1, Attachment 1). The Commission 

proposed to accept a new version of the Operational Reliability Information Reliability 

Standard, TOP-005-2, in Mandatory Reliability Standards for Interconnection Reliability 
Docket No. RM10-8-000 - 4 - 

interpretation was originally developed based on a review of version IRO-005-1 of the 

Reliability Coordination – Current-Day Operations Reliability Standard. According to 

NERC, the intervening changes resulting in the current versions are not material to the 

substance of the interpretation.10 Therefore, although our discussion of the interpretation 

will refer for convenience to the IRO-005-1 and TOP-005-1 versions of the Reliability 

Standards, the discussion in this NOPR is intended to apply equally to subsequent 

versions of the standards. 

5. Also in Order No. 693, the Commission declined to approve standards addressing 

Special Protection System design, operation, and coordination, finding them to be “fill in 

the blank” standards.11 Such fill-in-the-blank standards would require the regional 

reliability organizations to develop criteria for use by users, owners or operators within 

each region. In Order No. 693, the Commission required NERC to submit supplemental 

 

Operating Limits, NOPR, Docket No. RM10-15-000, 75 Fed. Reg. 71613 (Nov. 24, 

2010), 133 FERC ¶ 61,151, at P 65 (2010) (requesting comment whether the list of 

minimum electric system reliability data in TOP-005-1, Attachment 1 is beneficial for 

reliability coordinators to meet the requirements of IRO-008-1 and IRO-009-1). 

10 The Order No. 693 directive to add the operational status of Special Protection 

Systems and power system stabilizers to the types of information to be provided under 

TOP-005-1 remains outstanding. 

11 Mandatory Reliability Standards for the Bulk-Power System, Order No. 693, 

FERC Stats. & Regs. ¶ 31,242, at P 1520, 1528, et seq. (2007) (declining to approve or 

remand certain Special Protection Systems-related Reliability Standards, including PRC012-0, Special Protection System Review Procedure; PRC-013-0, Special Protection 

System Database; PRC-014-0, Special Protection System Assessment). The Commission 

used the term fill-in-the-blank standards to refer to proposed standards that required the 

regional reliability organizations to develop at a later date criteria for use by users, 

owners or operators within each region. 
Docket No. RM10-8-000 - 5 - 

information for the fill-in-the-blank standards, including standards for Special Protection 

System design, and found that absent such information the Commission was not in a 

position to approve or remand those Reliability Standards. 

6. The NERC glossary provides definitions of terms used in the Reliability Standards 

and defines a “Special Protection System” (or SPS) as: 

An automatic protection scheme designed to detect abnormal 

or predetermined system conditions and take corrective 

actions other than and/or in addition to the isolation of faulted 

component to maintain system reliability. Such action may 

include changes in demand, generation (MW and MVAR), or 

system configuration to maintain system stability, acceptable 

voltage or power flows.12 

7. Special Protection Systems generally are used to address system reliability 

vulnerabilities in lieu of installing more costly additional Bulk-Power System facilities. 

For instance, a Special Protection System may be used to control generator output to limit 

line loading after a contingency, or a Special Protection System may rely on predetermined operational protocols to reconfigure the system in response to identified 

system conditions to prevent system instability or cascading outages, and protect other 

facilities in response to transmission outages. 

 12 In the Western Interconnection, a Special Protection System is called a 

“Remedial Action Scheme.” 
Docket No. RM10-8-000 - 6 - 

8. Since Order No. 693 was issued, NERC has produced a white paper providing 

background for its Protection System Reliability Standards development effort.13 After 

this standards development effort was initiated, the NERC Regional Reliability Standards 

Working Group identified the Special Protection System standard as one that required 

regional standard development.14 The Commission understands that the regional 

standard development efforts are currently ongoing. 

9. NERC’s Rules of Procedure provide that a person that is “directly and materially 

affected” by Bulk-Power System reliability may request an interpretation of a Reliability 

Standard.15 The ERO’s “standards process manager” will assemble a team with relevant 

expertise to address the requested interpretation and also form a ballot pool. NERC’s 

Rules provide that, within 45 days, the team will draft an interpretation of the Reliability 

Standard, with subsequent balloting. If approved by ballot, the interpretation is appended 

to the Reliability Standard and filed with the applicable regulatory authority for 

regulatory approval. 

 13 NERC System Protection and Control Subcommittee (SPCS), November 18, 

2008 white paper on Protection System Reliability, Redundancy of Protection System 

Elements available at http://www.nerc.com/filez/spctf.html (posted Jan. 14, 2009). 

14 NERC Regional Reliability Standards Working Group, Notes on October 29, 

2009 meeting, available at http://www.nerc.com/filez/rrswg.html . 

15 NERC Rules of Procedure, Appendix 3A, Reliability Standards Development 

Procedure, Version 6.1, at 26-27 (2007). 
Docket No. RM10-8-000 - 7 - 

B. Reliability Standards and Interpretation Request

1. Reliability Standard IRO-005-1

10. Reliability Standard IRO-005-1 applies to transmission operators, balancing 

authorities, reliability coordinators and purchasing selling entities. The IRO-005-1 

Purpose statement provides: “The Reliability Coordinator must be continuously aware of 

conditions within its Reliability Coordinator Area and include this information in its 

reliability assessments. The Reliability Coordinator must monitor Bulk Electric System 

parameters that may have significant impacts upon the Reliability Coordinator Area and 

neighboring Reliability Coordinator Areas.” Requirement R12 of Reliability Standard 

IRO-005-1 requires the transmission operator to immediately notify the reliability 

coordinator of the status of certain Special Protections Systems, whenever those Special 

Protection Systems are armed, including any degradation or potential failure to operate as 

expected. Requirement R12 provides: 

Whenever a Special Protection System that may have an 

inter-Balancing Authority, or inter-Transmission Operator 

impact (e.g., could potentially affect transmission flows 

resulting in a SOL or IROL violation) is armed, the 

Reliability Coordinator shall be aware of the impact of the 

operation of that Special Protection System on inter-area 

flows. The Transmission Operator shall immediately inform 

the Reliability Coordinator of the status of the Special 

Protection System including any degradation or potential 

failure to operate as expected. 

2. Reliability Standard TOP-005-1 

11. Reliability Standard TOP-005-1 applies to transmission operators, balancing 

authorities, reliability coordinators and purchasing selling entities, and has the stated 
Docket No. RM10-8-000 - 8 - 

purpose of ensuring that reliability entities have the operating data needed to monitor 

system conditions within their areas.16

12. Requirement R3 of Reliability Standard TOP-005-1 requires each balancing 

authority and transmission operator to provide its neighboring balancing authorities and 

transmission operators with operating data to allow them to perform operational 

reliability assessments and to coordinate reliable operations. Included in the types of data 

to be reported are “New or degraded special protection systems.” TOP-005-1, 

Requirement R3 provides: 

Upon request, each Balancing Authority and Transmission 

Operator shall provide to other Balancing Authorities and 

Transmission Operators with immediate responsibility for 

operational reliability, the operating data that are necessary to 

allow these Balancing Authorities and Transmission 

Operators to perform operational reliability assessments and 

to coordinate reliable operations. Balancing Authorities and 

Transmission Operators shall provide the types of data as 

listed in Attachment 1-TOP-005-0 “Electric System 

Reliability Data,” unless otherwise agreed to by the Balancing 

Authorities and Transmission Operators with immediate 

responsibility for operational reliability. 

3. Manitoba Hydro Interpretation Request 

13. Manitoba Hydro requested clarification from NERC of the meaning of the term 

“degraded/degradation” as used in NERC Reliability Standards TOP-005-1 and IRO-005-

1.17 Specifically, Manitoba Hydro asked whether a Special Protection System that is 

 16 Order No. 693, FERC Stats. & Regs. ¶ 31,242 at P 1642. 

17 The NERC Petition provides a copy of Manitoba Hydro’s November 28, 2008 

request for interpretation as Exhibit A. 
Docket No. RM10-8-000 - 9 - 

operating with only one communication channel in service would be considered 

“degraded” for the purposes of these standards. Manitoba Hydro stated: 

Unlike other facilities, Special Protection Systems are 

required by NERC standards to be designed with redundant 

communication channels, so that if one communication 

channel fails the SPS is able to remain in operation. 

Requirement R1.3 of NERC Standard PRC-012-0 requires a 

Regional Reliability Organization with Transmission Owners 

that use SPSs to have a documented review procedure to 

ensure that SPSs comply with reliability standards and 

criteria, including: “requirements to demonstrate that the SPS 

shall be designed so that a single SPS component failure, 

when the SPS was intended to operate, does not prevent the 

interconnected transmission system from meeting the 

performance requirements in TPL-001-0, TPL-002-0 and 

TPL-003-0.” Accordingly, SPSs are designed to continue to 

perform their function with only one communication channel 

in service. 

14. According to Manitoba Hydro, a Special Protection System should not be 

considered “degraded” if it is operating with one communication channel out of service. 

Manitoba Hydro supported its position as consistent with the Institute of Electrical and 

Electronics Engineers, Inc. (IEEE) definition of degraded as “the inability of an item to 

perform its required function.”18 Manitoba Hydro cites NERC Reliability Standard PRC012-0, Requirement R1.3 and asserts that Special Protection Systems are designed to 

 18 Manitoba Hydro request for interpretation at 4-5 (citing full IEEE definitions of 

degraded: “a failure that is gradual, or partial or both; for example, the equipment 

degrades to a level that, in effect, is a termination of the ability to perform its required 

function,” and failure (Reliability): “the termination of the ability of an item to perform 

its required function.” IEEE 100, The Authoritative Dictionary of IEEE Standards Terms 

(7th ed.) (2000)). 
Docket No. RM10-8-000 - 10 - 

continue to perform their function with only one communication channel in service.19 

Manitoba Hydro cites the NERC glossary as defining the function of a Special Protection 

System “to detect abnormal or predetermined system conditions, and take corrective 

actions other than and/or in addition to the isolation of faulted components to maintain 

system reliability.” Manitoba Hydro concludes that a Special Protection System with one 

communication channel out of service can still fully perform its function and, therefore, 

that a Special Protection System with one communication channel out of service is not 

degraded. 

C. NERC Petition

15. NERC submitted its Petition for Approval of Interpretations to Reliability 

Standard TOP-005-1 – Operational Reliability Information and Reliability Standard IRO005-1 – Reliability Coordination – Current Day Operations (Petition) on November 24, 

2009, seeking Commission approval of the interpretations referenced in the title of its 

pleading. 

16. Consistent with the NERC Rules of Procedure, NERC assembled a team to 

respond to the requests for interpretation and presented the proposed interpretations to 

industry ballot, using a process similar to the process it uses for the development of 

 19 According to Manitoba Hydro, PRC-012-0, Requirement R1.3 requires a 

Special Protection System to be designed so that, when the Special Protection System is 

intended to operate, a single component failure does not prevent the interconnected 

transmission system from meeting the performance requirements in TPL-001-0, TPL002-0 and TPL-003-0. In Order No. 693, the Commission did not approve PRC-012-0, 

finding that was a fill-in-the-blank standard and lacked regional review procedures for 

Special Protection Systems. 
Docket No. RM10-8-000 - 11 - 

Reliability Standards.20 According to NERC, the interpretations were developed and 

approved by industry stakeholders using the NERC Reliability Standards Development 

Procedure and approved by the NERC Board of Trustees (Board). 

17. In response to Manitoba Hydro’s interpretation request, NERC provided the 

following: 

TOP-005-1 does not provide, nor does it require, a definition 

for the term “degraded.” 

The IRO-005-1 ([Requirement] R12) standard implies that 

degraded is a condition that will result in a failure of an SPS 

to operate as designed. If the loss of a communication 

channel will result in the failure of an SPS to operate as 

designed, then the Transmission Operator would be mandated 

to report that information. On the other hand, if the loss of a 

communication channel will not result in the failure of the 

SPS to operate as designed, then such a condition can be, but 

is not mandated to be, reported. 

18. Also, in a background description of the interpretation, NERC affirms that 

transmission operators are required to provide information such as that listed in the 

examples upon request, “whether or not [a facility] is or is not in some undefined 

‘degraded’ state.”21 

19. In addition, the background section accompanying the interpretation emphasizes 

that the information to be provided under IRO-005-1 relates to events that may have a 

 20 NERC Reliability Standards Development Procedure at 26-27. 

21 NERC Petition, Exhibit B at 5 (proposing text of interpretation as Appendix 1 to 

IRO-005-1 and TOP-005-1). 
Docket No. RM10-8-000 - 12 - 

significant impact on the system, especially where operating limits are or may be 

exceeded. Specifically it states: 

IRO-005-1 mandates that each Reliability Coordinator 

monitor predefined base conditions (Requirement R1), collect 

additional data when operating limits are or may be exceeded 

(Requirement R3), and identify actual or potential threats 

(Requirement R5). The basis for that request is left to each 

Reliability Coordinator. The Purpose statement of IRO-005-1 

focuses on the Reliability Coordinator’s obligation to be 

aware of conditions that may have a “significant” impact 

upon its area and to communicate that information to others 

(Requirements R7 and R9). Please note: it is from this 

communication that Transmission Operators and Balancing 

Authorities would either obtain or would know to ask for 

[Special Protection System] information from another 

Transmission Operator.22 

20. In addition, the NERC Petition states: 

The NERC Board of Trustees, in approving these 

interpretations, did so using a standard of strict construction 

that does not expand the reach of the standard or correct a 

perceived gap or deficiency in the standard. However, the 

NERC Board of Trustees recommended that any gaps or 

deficiencies in a Reliability Standard that are evident through 

the interpretation process be addressed promptly by the 

standard drafting team.23 

21. NERC reports that it will examine any gaps or deficiencies in Reliability 

Standards TOP-005-1 and IRO- 005-2 when it develops the next version of these 

standards through the Reliability Standards development process. 

 22 Id. Exhibit B at 6. 

23 NERC Petition at 5. 
Docket No. RM10-8-000 - 13 - 

22. According to NERC, the interpretations do not modify the language contained in 

the requirements under review. NERC states that the interpretations do not represent new 

or modified Reliability Standard requirements and will provide instruction and guidance 

of the intent and application of the requirements. NERC requests that the Commission 

approve the interpretations and make them effective immediately after approval, 

consistent with the Commission’s procedures. 

II. Proposed Determination

23. We propose to approve NERC’s interpretation of Reliability Standards IRO-005-1, 

Requirement R12, and TOP-005-1, Requirement R3. We believe that the ERO has 

presented a reasonable interpretation that is not inconsistent with the language of the 

Reliability Standards. However, we are concerned that the interpretation highlights a 

potential gap in reliability. While not required by the Reliability Standards as interpreted 

by the ERO, we are concerned that a Special Protection System that has lost a 

communication channel could compromise system reliability, for the reasons explained 

below. Accordingly, pursuant to section 215 (d)(5) of the FPA, we propose to direct that 

the ERO develop modifications to the Reliability Standards to address our concern. 

Specifically, we propose to direct the ERO to develop modifications to IRO-005-1, 

Requirement R12, and TOP-005-1, Requirement R3. 

A. Discussion

24. The Commission proposes to approve the interpretation. We agree with the ERO 

that the failure of a Special Protection System to operate as designed is, for the purpose 

of Reliable Operation, degraded and reportable under Reliability Standards IRO-005-1, 
Docket No. RM10-8-000 - 14 - 

Requirement R12 and TOP-005-1, Requirement R3. The Commission is concerned, 

however, that this interpretation may create a reliability gap concerning the reporting 

requirements for a Special Protection System that is able to operate as designed but still 

poses a reliability risk to Bulk-Power System with the loss of a single communication 

channel with redundant design. 

25. In its November 18, 2008 white paper, “Protection System Reliability, 

Redundancy of Protection System Elements,” the NERC System Protection and Control 

Subcommittee (SPCS) explained that “[r]edundancy means that two or more functionally 

equivalent Protection Systems are used to protect each electric system element.”24 The 

SPCS also explained in its white paper that “[a] fundamental concept of redundancy is 

that Protection Systems need to be designed such that electric system faults will be 

cleared, even if a component of the Protection System fails.”25 In accordance with the 

analysis provided in the SPCS white paper, redundancy of Protection System components 

is neither unnecessary nor superfluous. Rather, redundancy is necessary to ensure that no 

single point of failure of a Protection System component results in the inability of the 

Bulk-Power System to meet the system performance requirements established in the TPL 

 24 NERC SPCS white paper at 9, available at http://www.nerc.com/filez/spctf.html

(dated Jan. 14, 2009). 

25 Id.; see also Table 4-3 in the white paper noting possible responses to 

communication channel failure including adding a redundant channel or performing 

testing to ensure that delayed fault clearing does not violate the planning standards. 
Docket No. RM10-8-000 - 15 - 

Reliability Standards.26 In other words, redundant communication channels are a means 

to provide for the reliable operation of the Special Protection System. Should a 

communication channel fail at the time the Special Protection System is required to 

operate, the designed redundancy of the Special Protection System ensures that the BulkPower System can meet its reliability performance requirements. 

26. Our concern is that, given NERC’s proposed interpretation, a loss of a 

communication channel, a necessary and inherent performance requirement of a Special 

Protection System, may not be considered a reportable event under the current reporting 

requirements. Because Special Protection Systems are by their nature used to address 

system reliability vulnerabilities to prevent system instability, cascading outages, and 

protect other facilities in response to contingencies, a failure of the remaining 

communication component of a Special Protection System creates a reliability risk to the 

Bulk-Power System. This means that where one communication channel has failed, the 

Special Protection System may not be able to meet the performance criteria of the 

Reliability Standards and in particular the performance criteria specified in the 

Transmission Planning (TPL) standards. In such a situation, the Special Protection 

 26 We note proposed NERC Reliability Standard PRC-012-0, Requirement R1.3 

establishes a performance requirement for Special Protection Systems. Proposed 

Requirement R1.3 states: “Requirements to demonstrate that the SPS shall be designed 

so that single SPS component failure, when the SPS was intended to operate, does not 

prevent the interconnected transmission system from meeting the performance 

requirements defined in Reliability Standards TPL-001-0, TPL-002-0, and TPL-003-0.” 

Proposed reliability standard PRC-012-0 has not yet been approved as mandatory and 

enforceable by the Commission. 
Docket No. RM10-8-000 - 16 - 

System, though capable of operating as designed following the loss of one 

communication channel, may not be able to withstand a second component failure. It is 

our view that such a Special Protection System would be operating at some state less than 

the normal secure state and should need to be reported to the appropriate reliability 

entities in order for these reliability entities to accurately assess operational reliability. 

B. Commission Proposal

27. For the reasons stated above, the Commission proposes to direct the ERO to 

develop modification to Reliability Standards IRO-005-2 and TOP-005-1.1 through its 

standards development process. The ERO’s revision would address the potential 

reliability gap discussed above to ensure that a component failure, wherein a Special 

Protection System may not be able to perform as designed to ensure required Bulk-Power 

System performance, is reported to the appropriate reliability entities. Accordingly, 

pursuant to section 215 (d)(5) of the FPA, we propose to direct NERC to develop 

modifications to the Reliability Standards to address our concern. Specifically, we 

propose to direct NERC to develop modifications to Reliability Standards IRO-005-2 and 

TOP-005-1.1 to address the potential reliability gap discussed above to ensure that a 

component failure, wherein a Special Protection System may not be able to perform as 

designed to ensure required Bulk-Power System performance, is reported to the 

appropriate reliability entities. We seek comment on this proposal. In particular, we seek 

comment from reliability coordinators and transmission operators whether this 

information would be useful in the operation and coordination of the transmission 

system. 
Docket No. RM10-8-000 - 17 - 

III. Information Collection Statement

28. The Office of Management and Budget (OMB) regulations require that OMB 

approve certain reporting and recordkeeping (collections of information) imposed by an 

agency.

27 The information contained here is also subject to review under section 3507(d) 

of the Paperwork Reduction Act of 1995.28 

29. As stated above, the Commission previously approved, in Order No. 693, 

materially similar versions of each of the Reliability Standards that are the subject of the 

current rulemaking. This NOPR proposes to approve the interpretation of these 

previously approved Reliability Standards, which was developed by NERC as the ERO. 

In doing so, the Commission proposes certain issues to be addressed and clarifications to 

be made. The proposed interpretations, as clarified, relate to existing Reliability 

Standards and the Commission does not expect them to add to or otherwise increase 

entities’ current reporting burden.29

30. For the purposes of reviewing this interpretation, the Commission seeks 

information concerning whether the interim interpretation as approved will cause 

respondents to alter reporting frequencies and potentially impose an additional burden. 

31. We will submit this proposed rule to OMB for informational purposes. 

 27 5 CFR 1320.11. 

28 44 U.S.C. 3507(d). 

29 See Order No. 693, FERC Stats. & Regs. ¶ 31,242 at P 1901-1907. 
Docket No. RM10-8-000 - 18 - 

Title: Electric Reliability Organization Interpretations of Interconnection Reliability 

Operations and Coordination and Transmission Operations Reliability Standards. 

Action: Proposed Collection. 

OMB Control No.: 1902-0244 

Respondents: Businesses or other for-profit institutions; not-for-profit institutions. 

Frequency of Responses: On Occasion. 

Necessity of the Information: This proposed rule would approve an interpretation of the 

specific requirements of two Commission-approved Reliability Standards. The proposed 

rule would find the interpretation just, reasonable, not unduly discriminatory or 

preferential, and in the public interest. 

32. Interested persons may obtain information on the reporting requirements by 

contacting the following: Federal Energy Regulatory Commission, 888 First Street, NE, 

Washington, DC 20426 [Attention: Ellen Brown, Office of the Executive Director, 

Phone: (202) 502-8663, fax: (202) 273-0873, e-mail: data.clearance@ferc.gov]. 

33. For submitting comments concerning the collection(s) of information and the 

associated burden estimate(s), please send your comments to the contact listed above and 

to the Office of Information and Regulatory Affairs, Office of Management and Budget, 

Washington, DC 20503 [Attention: Desk Officer for the Federal Energy Regulatory 

Commission, phone (202) 395-7345, fax: (202) 395-7285, e-mail: 

oira_submission@omb.eop.gov]. 
Docket No. RM10-8-000 - 19 - 

IV. Environmental Analysis

34. The Commission is required to prepare an Environmental Assessment or an 

Environmental Impact Statement for any action that may have a significant adverse effect 

on the human environment.30 The Commission has categorically excluded certain 

actions from this requirement as not having a significant effect on the human 

environment. Included in the exclusion are rules that are clarifying, corrective, or 

procedural or that do not substantially change the effect of the regulations being 

amended.31 The actions proposed herein fall within this categorical exclusion in the 

Commission’s regulations. 

V. Regulatory Flexibility Act 

35. The Regulatory Flexibility Act of 1980 (RFA)32 generally requires a descriptio

and analysis of final rules that will have significant economic impact on a substantial 

number of small entities. The RFA mandates consideration of regulatory alternatives 

accomplish the stated objectives of a proposed rule and that minimize any signifi

economic impact on a substantial number of small entities. The Small Business 

Administration’s (SBA) Office of Size Standards develops the numerical definition of a

n 

that 

cant 

 30 Regulations Implementing the National Environmental Policy Act of 1969, 

Order gs. ¶ 30,783 (1987). 

(ii). 

No. 486, FERC Stats. & Re

31 18 CFR 380.4(a)(2)

32 5 U.S.C. 601-612. 
Docket No. RM10-8-000 - 20 - 

small business.33 The SBA has established a size standard for electric utilities, stating 

that a firm is small if, including its affiliates, it is primarily engaged in the transmission, 

generation and/or distribution of electric energy for sale and its total electric output for 

the preceding twelve months did not exceed four million megawatt hours.34 The RFA is 

ot 

e 

. 

s, 

terial 

tity 

not implicated by this proposed rule because the interpretations discussed herein will n

have a significant economic impact on a substantial number of small entities. 

36. In Order No. 693, the Commission adopted policies to minimize the burden on 

small entities, including approving the ERO compliance registry process to identify thos

entities responsible for complying with mandatory and enforceable Reliability Standards

The ERO registers only those distribution providers or load serving entities that have a 

peak load of 25 MW or greater and are directly connected to the bulk electric system or 

are designated as a responsible entity as part of a required under-frequency load shedding 

program or a required under-voltage load shedding program. Similarly, for generator

the ERO registers only individual units of 20 MVA or greater that are directly connected 

to the bulk electric system, generating plants with an aggregate rating of 75 MVA or 

greater, any blackstart unit material to a restoration plan, or any generator that is ma

to the reliability of the Bulk-Power System. Further, the ERO will not register an en

that meets the above criteria if it has transferred responsibility for compliance with 

mandatory Reliability Standards to a joint action agency or other organization. The 

 33 13 CFR 121.101. 

34 13 CFR 121.201, Sector 22, Utilities, & n. 1. 
Docket No. RM10-8-000 - 21 - 

Commission estimated that the Reliability Standards approved in Order No. 693 would 

apply to approximately 682 small entities (excluding entities in Alaska and Hawaii), bu

also pointed out that the ERO’s Compliance Registry Criteria allow for a joint action 

agency, generation and transmission (G&T) cooperative o

t 

r similar organization to accept 

lly, as noted above, this proposed rule addresses an interpretation of the IROty Standards, which were already approved in Order No. 

compliance responsibility on behalf of its members. Once these organizations register 

with the ERO, the number of small entities registered with the ERO will diminish and, 

thus, significantly reduce the impact on small entities.35 

37. Fina

005-1 and TOP-005-1 Reliabili

693, and, therefore, is not expected to create an additional regulatory impact on small 

entities. 

VI. Comment Procedures

38. The Commission invites interested persons to submit comments on the matters

issues proposed in this notice to be adopted, including any related matters or alternative 

proposals that commenters may wish to discuss. Comments a

 and 

re due [Insert Date that is 

ey 

 

45 days after publication in the FEDERAL REGISTER]. Comments must refer to 

Docket No. RM10-8-000, and must include the commenters’ name, the organization th

represent, if applicable, and their address in their comments. 

35 To be included in the compliance registry, the ERO determines whether a 

specific small entity has a material impact on the Bulk-Power System. If these small 

entities should have such an impact then their compliance is justifiable as necessary for 

Bulk-Power System reliability. 
Docket No. RM10-8-000 - 22 - 

39. The Commission encourages comments to be filed electronically via the eFiling 

link on the Commission’s web site at http://www.ferc.gov. The Commission accepts

most standard word processing formats. Documents created electronically using word 

ary 

ill be placed in the Commission’s public files and may be viewed, 

 as described in the Document Availability section 

processing software should be filed in native applications or print-to-PDF format and not

in a scanned format. Commenters filing electronically do not need to make a paper 

filing. 

40. Commenters unable to file comments electronically must mail or hand deliver an 

original copy of their comments to: Federal Energy Regulatory Commission, Secret

of the Commission; 888 First Street, NE; Washington, DC 20426. 

41. All comments w

printed, or downloaded remotely

below. Commenters on this proposal are not required to serve copies of their comments 

on other commenters. 

VII. Document Availability

42. In addition to publishing the full text of this document in the Federal Register, the

Commission provides all interested persons an opportunity to view and/or print the 

contents of this document via the Internet through the Commission’s Home Page 

(http://www.ferc.gov) and in the Commission’s Public Reference Room during normal 

business hours (8:30 a.m. to 5:00 p.m. Eastern time) at 888 First Street, NE, Roo

Washington, DC 20426. 

43. From the Commission’s Home Page on the Internet, this information is availa

on eLibrary. The full text of this docum

m 2A, 

ble 

ent is available on eLibrary in PDF and 
Docket No. RM10-8-000 - 23 - 

during 

 Online Support at (202) 502-6652 (toll free at 1-866-

08- rt@ferc.gov

Microsoft Word format for viewing, printing, and/or downloading. To access this 

document in eLibrary, type the docket number excluding the last three digits of this 

document in the docket number field. 

44. User assistance is available for eLibrary and the Commission’s website 

normal business hours from FERC

2 3676) or e-mail at ferconlinesuppo , or the Public Reference Room at 

02) 502-8371, TTY (202) 502-8659. E-mail the Public Reference Room at 

ublic.referenceroom@ferc.gov

(2

p . 

 By direction of the Commission. 

Kimberly D. Bose, 

Secretary.