FERC Open Commission Meeting

January 23, 2020

Staff Presentation Items

E-20, E-21, E-22 and E-24

Good morning Chairman and Commissioners,

Today we are presenting for your approval four reliability-related matters: Items 

E-20, E-21, E-22, and E-24.

Item E-20 is a draft order on NERC’s five-year performance assessment filing. This 

performance assessment is the third such assessment filed by NERC as the Electric 

Reliability Organization, marking NERC’s thirteenth year as the ERO. The draft order 

finds that NERC and the Regional Entities continue to satisfy statutory and regulatory 

criteria. The draft order recognizes the achievements NERC and the Regional Entities 

have made over the last five years, including NERC’s risk-based approach that focuses

ERO resources on matters of most significance to reliability. The draft order 

concludes that NERC continues to demonstrate its ability to develop and enforce 

Reliability Standards.

In addition, as with prior Commission orders on NERC performance assessment filings, 

the draft order identifies improvements that NERC or the Regional Entities must 

make. Specifically, the draft order provides directives regarding: NERC’s Regional 

Entity oversight activities; the process for developing reliability guidelines; 

performance metrics for the Electricity Information Sharing and Analysis Center, 

known as the E-ISAC; sanction guidelines; and NERC’s organization certification 

program. The directives in the draft order do not dictate how NERC or the Regional 

Entities should administer their responsibilities—instead, the directives seek to 

improve the effectiveness of the ERO and Regional Entity functions and programs by 

ensuring they are formalized and reflect how they currently operate. The draft order 

provides NERC 90 days from the date of the issuance of the order to submit a 

compliance filing on the matters identified and 180 days to file updates to its Rules of 

Procedure.

Regarding Item E-21, this draft final rule approves Reliability Standard TPL-001-5 

(Transmission System Planning Performance Requirements) as just, reasonable, not 
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unduly discriminatory or preferential, and in the public interest. As discussed in the 

draft final rule, Reliability Standard TPL-001-5 improves upon currently-effective 

Reliability Standard TPL-001-4 by addressing (1) the study of single points of failure of 

protection systems; and (2) planned maintenance outages and stability analysis for 

spare equipment strategies. In addition, the draft final rule declines to pursue other 

proposals from the Notice of Proposed Rulemaking, determining that based on 

comments of NERC and others that it is reasonable to address single points of failure 

in combination with three-phase faults as extreme events without requiring corrective 

action plans.

Item E-22 is a draft Final Rule approving Reliability Standard CIP-012-1 (Cyber Security 

– Communications between Control Centers), which NERC filed in response to a 

Commission directive in Order No. 822. Consistent with the directive, Reliability 

Standard CIP-012-1 improves upon the currently-effective CIP Reliability Standards by 

supporting situational awareness and reliable bulk electric system operations. 

Specifically, Reliability Standard CIP-012-1 requires responsible entities to protect the 

confidentiality and integrity of Real-time Assessment and Real-time monitoring data 

transmitted between bulk electric system Control Centers. In addition, the draft 

Final Rule directs NERC to develop and submit modifications to the Reliability 

Standards to require protections regarding the availability of communication links and 

data communicated between bulk electric system Control Centers. 

Further, the draft Final Rule does not adopt the directive proposed in Order No. 822 

for NERC to develop modifications to the CIP Reliability Standards to identify the 

types of data that must be protected under Reliability Standard CIP-012-1. The draft 

Final Rule finds that the comments filed in response to the Notice of Proposed 

Rulemaking convince the Commission further clarification is not necessary.

Item E-24 is a draft Notice of Proposed Rulemaking that proposes to approve the 

retirement of 74 of the 77 Reliability Standard requirements that NERC proposed to 

retire. The proposed retirements were developed under NERC’s Standards Efficiency 

Review Project, which is designed to identify Reliability Standard requirements that 

provide little reliability benefit, are administrative in nature, or are redundant with 

other Reliability Standards. The draft Notice of Proposed Rulemaking agrees with 

NERC that retirement of the 74 Reliability Standards requirements will reduce 

duplicative or otherwise unnecessary regulatory burdens. The draft Notice of 

Proposed Rulemaking also proposes to remand one requirement submitted for 

retirement by NERC, Reliability Standard VAR-001-6 Requirement R2, because it is the 
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only requirement that explicitly requires transmission operators to schedule reactive 

resources. In addition, the draft Notice of Proposed Rulemaking seeks additional 

information from NERC on two other requirements, proposed for retirement, FAC-008-

3 Requirements R7 and R8, because these requirements may not completely be 

covered by other Reliability Standards and, therefore may not be appropriate for 

retirement.

That concludes our presentation. We would be happy to answer any questions.