134 FERC ¶ 61,213 

UNITED STATES OF AMERICA 

FEDERAL ENERGY REGULATORY COMMISSION 

18 CFR Part 40 

[Docket No. RM10-15-000; Order No. 748] 

Mandatory Reliability Standards for Interconnection Reliability Operating Limits 

(Issued March 17, 2011) 

AGENCY: Federal Energy Regulatory Commission. 

ACTION: Final Rule. 

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

Regulatory Commission (Commission) approves three new Interconnection Reliability 

Operations and Coordination Reliability Standards and seven revised Reliability 

Standards related to Emergency Preparedness and Operations, Interconnection Reliability 

Operations and Coordination, and Transmission Operations. These Reliability Standards 

were submitted to the Commission for approval by the North American Electric 

Reliability Corporation (NERC), which the Commission has certified as the Electric 

Reliability Organization responsible for developing and enforcing mandatory Reliability 

Standards. The Reliability Standards were designed to prevent instability, uncontrolled 

separation, or cascading outages that adversely impact the reliability of the 

interconnection by ensuring that the reliability coordinator has the data necessary to 

assess its reliability coordinator area during the operations horizon and that it takes 

prompt action to prevent or mitigate instances of exceeding Interconnection Reliability 
Docket No. RM10-15-000 - 2 - 

Operating Limits. The Commission also approves the addition of two new terms to the 

NERC Glossary of Terms. 

 In addition, the Commission approves NERC’s proposed revisions to Reliability 

Standards EOP-001-1, IRO-002-2, IRO-004-2, IRO-005-3, TOP-003-1, TOP-005-2, and 

TOP-006-2, which remove requirements for the reliability coordinator to monitor and 

analyze system operating limits other than interconnection reliability operating limits. 

EFFECTIVE DATE: This Rule will become effective [60 days after publication in the

FEDERAL REGISTER] 

FOR FURTHER INFORMATION CONTACT: 

Darrell Piatt (Technical Information) 

Office of Electric Reliability 

Division of Reliability Standards 

Federal Energy Regulatory Commission 

888 First Street, NE 

Washington, DC 20426 

Telephone: (202) 502-6687 

A. Cory Lankford (Legal Information) 

Office of the General Counsel 

Federal Energy Regulatory Commission 

888 First Street, NE 

Washington, DC 20426 

Telephone: (202) 502-6711 

William Edwards (Legal Information) 

Office of the General Counsel 

Federal Energy Regulatory Commission 

888 First Street, NE 

Washington, DC 20426 

Telephone: (202) 502-6669 

SUPPLEMENTARY INFORMATION:
134 FERC ¶ 61,213 

UNITED STATES OF AMERICA 

FEDERAL ENERGY REGULATORY COMMISSION 

Mandatory Reliability Standards for Interconnection 

Reliability Operating Limits 

Docket No. RM10-15-000 

ORDER NO. 748 

TABLE OF CONTENTS

 Paragraph Numbers

I. Background ............................................................................................................................3.

A. Mandatory Reliability Standards......................................................................................3.

B. Order No. 693 Directives .................................................................................................4.

C. NERC Petition..................................................................................................................7.

1. IRO-008-1.....................................................................................................................11.

2. IRO-009-1.....................................................................................................................15.

3. IRO-010-1a...................................................................................................................16.

D. Notice of Proposed Rulemaking ......................................................................................18.

II. Discussion.............................................................................................................................21.

A. Division of Responsibilities for SOLs and IROLs ..........................................................22.

1. Continued Analysis of SOLs by Reliability Coordinators ...........................................26.

2. Documented Methodology to Identify System Operating Limit Information .............33.

3. Current Practices for the Prevention and Mitigation of SOLs and IROLs and the 

Monitoring Capability of the Reliability Coordinator.......................................................34.

4. Reliability Coordinator’s Procedures for Selecting the SOLs for Evaluation by 

the Interchange Distribution Calculator ............................................................................37.

5. Current Functional Model ............................................................................................38.

B. Operational Analyses and Real-time Assessments ..........................................................45.

C. Reliability Coordinator Actions to Operate Within IROLs ............................................52.

D. IRO-010-1a.......................................................................................................................56.

E. Violation Severity Levels and Violation Risk Factors.....................................................64.

III. Information Collection Statement .......................................................................................73.

IV. Environmental Analysis ......................................................................................................78.

V. Regulatory Flexibility Act ....................................................................................................79.

VI. Document Availability ........................................................................................................80.

VII. Effective Date and Congressional Notification .................................................................83.
 

134 FERC ¶ 61,213 

UNITED STATES OF AMERICA 

FEDERAL ENERGY REGULATORY COMMISSION 

Before Commissioners: Jon Wellinghoff, Chairman; 

 Marc Spitzer, Philip D. Moeller, 

 John R. Norris, and Cheryl A. LaFleur. 

Mandatory Reliability Standards for Interconnection 

Reliability Operating Limits 

Docket No. RM10-15-000 

ORDER NO. 748 

FINAL RULE 

(Issued March 17, 2011) 

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

 the Federal Energy 

Regulatory Commission (Commission) approves three new Interconnection Reliability 

Operations and Coordination (IRO) Reliability Standards and seven revised Reliability 

Standards related to Emergency Preparedness and Operations (EOP), IRO, and 

Transmission Operations (TOP). The proposed Reliability Standards were submitted to 

the Commission for approval by the North American Electric Reliability Corporation 

(NERC), which the Commission has certified as the Electric Reliability Organization 

(ERO) responsible for developing and enforcing mandatory Reliability Standards.2

 

These Reliability Standards were designed to prevent instability, uncontrolled separation, 

1

 16 U.S.C. 824o (2006). 

2 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. RM10-15-000 - 2 - 

 

or cascading outages that adversely impact the reliability of the interconnection by 

ensuring that the reliability coordinator has the data necessary to assess its reliability 

coordinator area during the operations horizon and that it takes prompt action to prevent 

or mitigate instances of exceeding Interconnection Reliability Operating Limits (IROL).3

 

The Commission also approves the addition of two new terms to the NERC Glossary of 

Terms (NERC Glossary). In addition, the Commission approves NERC’s proposed 

revisions to Reliability Standards EOP-001-1, IRO-002-2, IRO-004-2, IRO-005-3, TOP003-1, TOP-005-2, and TOP-006-2, which remove requirements for the reliability 

coordinator to monitor and analyze system operating limits (SOL)4

 other than IROLs. 

2. In addition, the Commission asks the ERO to evaluate certain issues through 

ongoing standards development and working group projects and to develop appropriate 

revisions as necessary. These issues regard the scope of the reliability coordinator’s 

responsibility under these and other IRO Reliability Standards. In particular, the 

Commission identifies, based on the comments received, certain issues regarding the 

3

 NERC defines IROLs as the value (such as MW, MVar, Amperes, Frequency or 

Volts) derived from, or a subset of the SOLs, which if exceeded, could expose a 

widespread area of the bulk electric system to instability, uncontrolled separation, or 

cascading outages. See NERC Glossary, available at

http://www.nerc.com/docs/standards/rs/Glossary_of_Terms_2010April20.pdf. 

4

 NERC defines SOLs as the value (such as MW, MVar, Amperes, Frequency or 

Volts) that satisfies the most limiting of the prescribed operating criteria for a specific 

system configuration to ensure operation within acceptable reliability criteria. Id.
Docket No. RM10-15-000 - 3 - 

delineation of the responsibility of the reliability coordinator to analyze, monitor and 

communicate to other operating entities the class of SOLs identified as “grid-impactive” 

SOLs by NERC. 

I. Background

A. Mandatory Reliability Standards

3. Section 215 of the FPA requires a Commission-certified ERO to develop 

mandatory and enforceable Reliability Standards, which are subject to Commission 

review and approval. Once approved, the Reliability Standards are enforced by the ERO, 

subject to Commission oversight, or by the Commission independently. 

B. Order No. 693 Directives

4. On March 16, 2007, the Commission issued Order No. 693, approving 83 of the 

107 initial Reliability Standards filed by NERC, including the currently-effective IRO 

Reliability Standards.5

 Under section 215(d)(5) of the FPA, the Commission directed 

NERC to develop modifications to the IRO Reliability Standards to address certain issues 

identified by the Commission. 

5. With respect to IRO-001-1, the Commission directed the ERO to develop 

modifications to eliminate the regional reliability organization as an applicable entity.6

 

 5 Mandatory Reliability Standards for the Bulk-Power System, Order No. 693, 72 

FR 16416 (Apr. 4, 2007), FERC Stats. & Regs. ¶ 31,242, order on reh’g, Order No. 

693-A, 120 FERC ¶ 61,053 (2007). 

6

 Order No. 693, FERC Stats. & Regs. ¶ 31,242 at P 896. 
Docket No. RM10-15-000 - 4 - 

 

The Commission also directed the ERO to modify IRO-002-1 to require a minimum set 

of capabilities that must be made available to the reliability coordinator to ensure that a 

reliability coordinator has the capabilities it needs to perform its functions.7

 With respect 

to IRO-003-2, the Commission directed the ERO to develop a modification to create 

criteria to define the term “critical facilities” in a reliability coordinator’s area and its 

adjacent systems.8

 The Commission also directed the ERO to modify IRO-004-1 to 

require the next-day analysis to identify control actions that can be implemented and 

effective within 30 minutes after a contingency. In addition, the Commission directed the 

ERO to consider adding Measures and Levels of Non-Compliance to Reliability 

Standards IRO-004-1 and IRO-005-1 that are commensurate with the magnitude, 

duration, frequency and causes of the violations and whether these occur during normal 

or contingency conditions.9

 

6. The Commission also directed the ERO to conduct a survey on IROL practices 

and actual operating experiences by requiring reliability coordinators to report any 

violations of IROLs, their causes, the date and time, the durations and magnitudes in 

7 Id. P 908. 

8 Id. P 914. 

9 Id. P 935. NERC has subsequently replaced Levels of Non-Compliance with 

Violation Severity Levels. See Order on Violation Severity Levels Proposed by the 

Electric Reliability Organization, 123 FERC ¶ 61,284 (Violation Severity Level Order), 

order on reh’g, 125 FERC ¶ 61,212 (2008). 
Docket No. RM10-15-000 - 5 - 

which actual operations exceed IROLs to the ERO on a monthly basis for one year 

beginning two months after the effective date of Order No. 693.10 On October 31, 2008, 

NERC filed the results of its year-long survey with the Commission.11 On February 8, 

2009, NERC supplemented those results in a second filing.12

C. NERC Petition

7. On December 31, 2009, NERC submitted a petition to the Commission (NERC 

Petition)13 seeking approval of proposed Reliability Standards IRO-008-1, IRO-009-1, 

and IRO-010-1a. Under these Reliability Standards, reliability coordinators must analyze 

and monitor IROLs within their Wide-Area14 to prevent instability, uncontrolled 

separation, or cascading outages that adversely impact the reliability of the 

interconnection. These Reliability Standards do not require the reliability coordinator to 

 10 Id. P 951. 

11 NERC, Compliance Filing, Docket No. RM06-16-006 (filed Oct. 31, 2008). 

12 NERC, Compliance Filing, Docket No. RM06-16-006 (filed Feb. 8, 2009). 

13 North American Electric Reliability Corp., Dec. 31, 2009 Petition for Approval 

of Proposed New and Revised Reliability Standards for Operating Within Interconnection 

Operating Limits. 

14 The term “Wide-Area” is defined in the NERC Glossary, approved by the 

Commission. As defined, Wide-Area includes not only the reliability coordinators’ area, 

but also critical flow and status information from adjacent reliability coordinator areas as 

determined by detailed system studies to allow the calculation of IROLs. See NERC 

Glossary available at

http://www.nerc.com/docs/standards/rs/Glossary_of_Terms_2010April20.pdf. 
Docket No. RM10-15-000 - 6 - 

 

analyze and monitor SOLs other than IROLs or to take preventive action to avoid or 

mitigate SOL violations within their reliability coordinator area. In developing the 

proposed IRO Reliability Standards, NERC determined that it was necessary to retire or 

modify certain requirements from several existing Reliability Standards. Therefore, 

NERC proposed revisions to Reliability Standards EOP-001-1,15 IRO-002-2, IRO-004-2, 

IRO-005-3, TOP-003-1, TOP-005-2, and TOP-006-2, which remove requirements for the 

reliability coordinator to monitor and analyze SOLs other than IROLs. NERC also 

requests approval of new definitions “Operational Planning Analysis” and “Real-time 

Assessment.” 

8. These IRO Reliability Standards together with the proposed revisions to existing 

Reliability Standards divide responsibility for SOLs and IROLs between reliability 

15 Concurrent with its Petition in this Docket, NERC filed a petition in Docket No. 

RM10-16-000 seeking approval of certain Emergency Preparedness and Operations 

Reliability Standards. NERC, Petition for Approval of Three Emergency Preparedness 

and Operations Reliability Standards, Docket No. RM10-16-000 (filed Dec. 31, 2009). 

As part of its Petition in RM10-16-000, NERC proposed to retire Requirement R3.4 of 

EOP-001-0. Each petition proposes unique changes to EOP-001-0 reflecting the distinct 

issues addressed by the respective Reliability Standards drafting teams. In this Final 

Rule, the Commission is addressing Version 2 of EOP-001 contained in Exhibit B of the 

NERC Petition which reflects both the IRO and the EOP proposed changes. 
Docket No. RM10-15-000 - 7 - 

 

coordinators and transmission operators according to the Functional Model.16 In its 

Petition, NERC explains that having two entities with the same primary responsibility is 

not supported by the Functional Model.17 However, NERC notes that these IRO 

Reliability Standards should not imply that the reliability coordinator will not look at its 

future operations with respect to specific SOLs.18 NERC states that the reliability 

coordinator must look at its future operations with respect to specific SOLs to ensure that 

their transmission operators are taking actions at appropriate times, but the primary 

responsibility for SOLs rests with the transmission operators. 

9. NERC explains that, under the new IRO Reliability Standards, the reliability 

coordinator retains overall visibility of all operations within its Wide-Area view, 

including some SOLs, although the transmission operator is primarily responsible for 

actions related to SOLs.19 NERC states that the IRO Reliability Standards were 

developed in support of the authority and assignment of tasks in the Functional Model.20 

16 NERC, Reliability Functional Model, version 5, at 30 (Dec. 2009), available at

http://www.nerc.com/files/Functional_Model_V5_Final_2009Dec1.pdf (NERC 

Functional Model). 

17 In its comments, NERC cites specific tasks outlined in the Functional Model for 

the respective duties of the reliability coordinator and transmission operator with respect 

to SOLs and IROLs. NERC Comments at 14. 

18 NERC Petition at 77. 

19 Id. at 78. 

20 Id. at 7-9. 
Docket No. RM10-15-000 - 8 - 

 

NERC explains that under the Functional Model, while reliability coordinators will 

assign their transmission operators tasks associated with IROLs, the reliability 

coordinator has ultimate responsibility for these tasks, and the reliability coordinator is 

sanctioned if these tasks are not performed as required by the Reliability Standards.21

10. NERC further explains that, in a similar fashion, the Functional Model assigns 

responsibility for SOLs that are not IROLs to the transmission operator. But, NERC 

states, this too is a shared responsibility.22 NERC states that, where the Transmission 

Operator has primary responsibility for developing the SOLs within its transmission 

operator area, the transmission operator may request the assistance of its reliability 

coordinator in developing these SOLs. In addition, NERC points out that reliability 

coordinators are responsible for ensuring that transmission operators develop SOLs for its 

reliability coordinator area in accordance with a methodology developed by the reliability 

coordinator.23 NERC states that the transmission operator must share its SOLs with its 

reliability coordinator, and the reliability coordinator must share any SOLs it develops 

with its transmission operator. NERC also states that the reliability coordinator monitors 

the status of some, but not all, SOLs. 

21 Id. at 8. 

22 Id. at 9. 

23 NERC Reliability Standard FAC-011-1, Requirement R3. 
Docket No. RM10-15-000 - 9 - 

1. IRO-008-1

11. Reliability Standard IRO-008-1 has the stated purpose of preventing instability, 

uncontrolled separation, or cascading outages that adversely impact the reliability of the 

interconnection by ensuring that the bulk electric system is assessed during the operations 

horizon. The proposed Reliability Standard applies to reliability coordinators. 

IRO-008-1 requires the reliability coordinator to use analyses and assessments as 

methods of achieving the stated goal. The Reliability Standard requires analysis of the 

reliability coordinator’s Wide-Area ahead of time and during real-time. It also requires 

communication with the entities that need to take specific operational actions based on 

the analyses and assessments. 

12. Reliability Standard IRO-008-1 contains three requirements. Requirement R1 

requires each reliability coordinator to perform an Operational Planning Analysis to 

assess whether the planned operations for the next day within its Wide-Area will exceed 

any of its IROLs during anticipated normal and contingency event conditions. 

Requirement R2 requires the reliability coordinator to perform a Real-Time Assessment 

at least once every 30 minutes to determine if its Wide Area is exceeding any IROLs or is 

expected to exceed any IROLs. Requirement R3 requires a reliability coordinator to 

share the results of an Operational Planning Analysis or Real-Time Assessment that 

indicates the need for specific operational actions to prevent or mitigate an instance of 

exceeding an IROL with those entities that are expected to take those actions. 
Docket No. RM10-15-000 - 10 - 

13. NERC also requests approval of two new terms that appear in IRO-008-1: 

“Operational Planning Analysis” and “Real-time Assessment.” Operational Planning 

Analysis is defined as: 

An analysis of the expected system conditions for the next day’s 

operation. (That analysis may be performed either a day ahead or as 

much as 12 months ahead.) Expected system conditions include 

things such as load forecast(s), generation output levels, and known 

system constraints (transmission facility outages, generator outages, 

equipment limitations, etc.). 

NERC states that the definition was designed to provide greater specificity regarding the 

day-ahead study. 

14. The proposed term “Real-time Assessment” is defined as “[a]n examination of 

existing and expected system conditions, conducted by collecting and reviewing 

immediately available data.” NERC states that the purpose of the new term is to assure 

that the reliability coordinator is required to conduct a real-time assessment, including 

situations in which the reliability coordinator is operating without its primary analysis 

facilities and has implemented the work-around requirements of IRO-002-2, Requirement 

R8. 
Docket No. RM10-15-000 - 11 - 

2. IRO-009-1

15. As proposed, Reliability Standard, IRO-009-1 is designed to prevent instability, 

uncontrolled separation, or cascading outages that adversely impact the reliability of the 

interconnection by “ensuring prompt action to prevent or mitigate instances of exceeding 

[IROLs].” Proposed Reliability Standard IRO-009-1 applies only to reliability 

coordinators. 

3. IRO-010-1a

16. NERC proposes the addition of a new Reliability Standard, IRO-010-1a24 to the 

current suite of IRO Reliability Standards. IRO-010-1a is designed to prevent instability, 

uncontrolled separation, or cascading outages that adversely impact the reliability of the 

interconnection by mandating that the reliability coordinator have the data it needs to 

monitor and assess the operation of its reliability coordinator area. 

17. The requirements in the Reliability Standard specify a formal request process for 

the reliability coordinator to explicitly identify the data and information it needs for 

reliability; and require the entities with the data to provide it as requested. The 

Reliability Standard applies to the reliability coordinator and to the other functional 

 24 Because the interpretation for IRO-010-1 was completed before the filing of 

IRO-010-1, NERC requests Commission approval of IRO-010-1a, which includes the 

standard as interpreted. 
Docket No. RM10-15-000 - 12 - 

entities that must supply data to the reliability coordinator.25 This includes entities that 

have been identified as owners, users, or operators of the Bulk-Power System. 

D. Notice of Proposed Rulemaking

18. On November 18, 2010, the Commission issued a Notice of Proposed Rulemaking 

(NOPR) proposing to approve Reliability Standards IRO-008-1, IRO-009-1, and IRO010-1a; revised Reliability Standards EOP-001-1, IRO-002-2, IRO-004-2, IRO-005-3, 

TOP-003-1, TOP-005-2, and TOP-006-2; and the two new NERC Glossary terms. 

19. In the NOPR, the Commission agreed with NERC that it is appropriate to develop 

requirements for Reliability Standards that offer a clear division of responsibilities among 

reliability coordinators and transmission operators. In addition, the Commission sought 

ERO and public comment to ensure that the proposed Reliability Standards will not 

create a reliability gap by the inappropriate division of responsibilities for analyzing, 

monitoring and resolving SOLs and IROLs between transmission operators and reliability 

coordinators respectively. 

20. In response to the NOPR, NERC and a number of parties filed comments. PJM 

Interconnection L.L.C., ISO New England, New York Independent System Operator, 

Inc., California Independent System Operation Corporation and Southwest Power Pool 

 25 The requirements in the standard are specifically applicable to the following 

functional entities: (1) reliability coordinator[s]; (2) balancing authority; (3) generator 

owner; (4) generator operator; (5) interchange authority; (6) load-serving entity; (7) 

transmission operator; and (8) transmission owner. 
Docket No. RM10-15-000 - 13 - 

submitted joint comments (Joint Commenters). The Edison Electric Institute (EEI), 

Midwest Independent Transmission System Operator, Inc. (Midwest ISO), and Western 

Electricity Coordinating Council (WECC) also submitted timely comments. American 

Electric Power Service Corp. (AEP) filed comments one day out-of-time. 

II. Discussion

21. The Commission hereby adopts its NOPR proposals and approves new Reliability 

Standards IRO-008-1, IRO-009-1, and IRO-010-1a; revised Reliability Standards EOP001-1, IRO-002-2, IRO-004-2, IRO-005-3, TOP-003-1, TOP-005-2, and TOP-006-2; and 

the two new NERC Glossary terms: “Operational Planning Analysis” and “Real-time 

Assessment.” In approving these Reliability Standards, the Commission concludes that 

they are just, reasonable, not unduly discriminatory or preferential, and in the public 

interest. These Reliability Standards serve an important reliability purpose in seeking to 

prevent instability, uncontrolled separation, or cascading outages that adversely impact 

the reliability of the interconnection by ensuring that the reliability coordinator has the 

data necessary to assess its reliability coordinator area during the operations horizon and 

that it takes prompt action to prevent or mitigate instances of exceeding IROLs. 

Moreover, they clearly identify the entities to which they apply and contain clear and 

enforceable requirements. Commenters addressed many of the Commission concerns 

discussed in the NOPR and in some areas the ERO has indicated that it is continuing to 

study some issues related to the Commission concerns. The Commission encourages the 
Docket No. RM10-15-000 - 14 - 

ERO, applying its technical expertise, to continue such reviews and make any necessary 

changes to applicable Reliability Standards. 

A. Division of Responsibilities for SOLs and IROLs 

22. In the NOPR, the Commission sought comment on a number of issues related to 

NERC’s division of responsibilities for SOLs and IROLs between reliability coordinators 

and transmission operators. NERC acknowledges in its Petition that the transmission 

operator must develop and share its SOLs with its reliability coordinator, and the 

reliability coordinator must share any SOLs it develops with its transmission operator.26 

NERC also states that it is currently working on a project to identify a subset of SOLs, 

other than IROLs, that the transmission operator and reliability coordinator must 

continuously analyze and monitor.27 Therefore, in the NOPR, the Commission sought 

comment on whether there is a need for reliability coordinators to continue to analyze, in 

addition to continuing to monitor and coordinate data on, SOLs other than IROLs.28 The 

Commission also sought comment on whether the reliability coordinator should have a 

documented methodology for identifying the SOL information it needs to fulfill its 

 26 NERC Petition at 77. 

27 NERC identifies this as “Project 2007-03: Real-time Operations,” available at 

http://www.nerc.com/filez/standards/Real-time_Operations_Project_2007-03.html. 

28 Under NERC FAC-011-2, reliability coordinators must have a documented 

methodology for use in developing SOLs within its reliability coordinator area. 
Docket No. RM10-15-000 - 15 - 

responsibilities for day-ahead analysis, monitoring and real-time assessments, and 

operational control within the reliability coordinator’s area. 

23. The Commission requested information from NERC, reliability coordinators, and 

other interested entities on the current practices of reliability coordinators and 

transmission operators with respect to coordinating operational responsibilities for 

monitoring, day ahead and real-time assessments. The Commission also asked for 

comments on Bulk-Power System operations related to SOLs and IROLs, on the practical 

division of responsibilities for preventing and mitigating SOL and IROL violations, and 

the monitoring capabilities of the reliability coordinator with respect to IROLs as well as 

other SOLs. Additionally, the Commission asked whether a reliability coordinator can 

provide an accurate assessment of the Bulk-Power System to its transmission operators 

on a Wide-Area basis, without evaluating: (1) the operating environment of SOLs that 

will impact the transmission operators within the reliability coordinator’s areas; (2) SOLs 

that have the potential to become IROLs; and, (3) the existing IROLs within the 

reliability coordinator area. The Commission further sought comment as to whether a 

transmission operator can provide reliable operating assessments or make reliable 

operating instructions on an SOL that is on the border between two different transmission 

operator’s areas. The Commission also requested comment on whether the reliability 

coordinator should have responsibility to monitor certain SOLs other than IROLs, and 
Docket No. RM10-15-000 - 16 - 

whether such a responsibility would place an unreasonable burden on reliability 

coordinators. 

24. The Commission noted that IRO-006-4.1 requires the reliability coordinator to 

model SOLs and IROLs in the Interchange Distribution Calculator (IDC) to perform the 

Transmission Loading Relief procedures. We sought comment on how reliability 

coordinators in the Eastern Interconnection select the SOLs for evaluation in the IDC and 

the extent of any burden this has caused the reliability coordinator. 

25. Finally, the Commission also sought comments from NERC and the public as to 

how the current Functional Model represents the delineation of assessment and operating 

responsibilities between the reliability coordinator and transmission operator with respect 

to SOLs and IROLs. 

Comments 

1. Continued Analysis of SOLs by Reliability Coordinators

26. NERC states in its comments, that the proposed IRO Reliability Standards 

appropriately distinguish which entity has primary responsibility for SOLs. Further, 

Bulk-Power System reliability practices assign responsibilities for analyzing and 

resolving conditions to the entities closest to it, so that the entity with the closest eye to 

the condition can quickly assess and resolve it. NERC asserts that it is appropriate for 

transmission operators to maintain primary responsibility for SOLs, and for reliability 

coordinators to maintain primary responsibility for IROLs. NERC also explains that, 
Docket No. RM10-15-000 - 17 - 

 

while SOLs are typically associated with the prevention of facility damage or the 

accelerated degradation of equipment life, only a subset of SOLs are used to analyze and 

monitor local area reliability and, therefore, the proposed IRO standards are silent on the 

reliability coordinator’s responsibility with respect to SOLs. 

27. NERC notes in its Petition, that the proposed Reliability Standards “should not 

imply that the Reliability Coordinator will not look at its future operations with respect to 

specific SOLs.”29 NERC also states that “[t]he Reliability Coordinator retains the overall 

visibility of all operations within its Wide-Area view, including some SOLs, although the 

transmission operator is primarily responsible for actions related to SOLs.”30 NERC also 

notes that the reliability coordinator can monitor the transmission operator’s actions to 

resolve SOLs and provides, as an example, that the reliability coordinator can study realtime operating trends to help determine whether an asset is trending toward a “gridimpactive SOL.”31 

28. In its comments, NERC provides the results of a survey conducted in response to 

the NOPR in which each of the nine reliability coordinators in the Eastern 

29 NERC Petition at 9. 

30 NERC Petition at 10. 

31 NERC Comments at 7. NERC does not offer a definition of the term “gridimpactive SOL,” but we understand it to mean an SOL that the reliability coordinator 

monitor so that it does not develop into an IROL. 
Docket No. RM10-15-000 - 18 - 

Interconnection responded that, for SOLs that it monitors, the SOLs were developed in a 

coordinated fashion with the transmission operators in its area. The survey responses did 

not suggest that any transmission operator withheld important SOL information from 

reliability coordinators, nor did any reliability coordinator indicate that transmission 

operators were not willing to work with the reliability coordinators in monitoring SOLs 

for Bulk-Power System reliability. NERC contends that this survey demonstrates that 

current operating practices are effective to ensure that reliability coordinators are able to 

obtain sufficient information from transmission operators in order to analyze and monitor 

certain SOLs other than IROLs. 

29. NERC also notes that, since the completion of the proposed IRO standards, the 

industry has been working to improve the clarity of Reliability Standard requirements 

regarding the transmission operator’s primary responsibility for SOLs through the Realtime Operations Standard Drafting Team (Project 2007-03). For example, NERC 

explains that the Standard Drafting Team has proposed to add a requirement to TOP-001-

2 that would require each transmission operator to inform its reliability coordinator of all 

SOLs which, while not IROLs, have been identified by the transmission operator as 

supporting its local area reliability based on its assessment of its Operational Planning 

Analysis. NERC states that, by using tools that properly model Wide-Area conditions, 

the reliability coordinators are able to identify and help resolve lower-level issues that 

may not explicitly be included in the reliability coordinator modeling capabilities. EEI 
Docket No. RM10-15-000 - 19 - 

supports NERC’s comments to the NOPR and believes that the Commission should 

encourage the NERC reliability coordinators working group to engage these issues with 

NERC stakeholders, especially the NERC Planning and Operating Committees. 

30. The Joint Commenters support the proposed primary division of responsibilities 

for SOLs and IROLs between reliability coordinators and transmission operators. They 

contend, though, that the proposed division should not be interpreted as implying that a 

reliability coordinator should not monitor any SOLs. The Joint Commenters further 

contend that it was not intended that the proposed Reliability Standards would remove all 

responsibility for SOLs from the reliability coordinator, but to establish a clear distinction 

of responsibilities and authority. The Joint Commenters state that they would not support 

a formal requirement that would assign primary responsibility for analyzing and 

resolving SOLs to a reliability coordinator since the primary responsibility is correctly 

assigned to the transmission operator that is most familiar with their respective operating 

limits and local Bulk-Power System characteristics. 

31. Midwest ISO states that it is necessary for reliability coordinators to analyze, 

monitor, and coordinate some SOLs other than IROLs and that the Reliability Standards 

should reflect this best practice. Midwest ISO believes the Commission should 

encourage the efforts currently underway at NERC towards the development of 

Reliability Standards addressing the role of reliability coordinators with regard to 
Docket No. RM10-15-000 - 20 - 

analyzing SOLs, other than IROLs, that are important to the reliable operation of the 

Bulk-Power System. 

32. AEP states that it generally supports the proposed Reliability Standards but that it 

agrees with concerns raised by the Commission that if reliability coordinators are not 

monitoring other SOLs, there is a potential gap in monitoring for SOLs that have the 

potential to become IROLs. AEP argues that performing an annual IROL identification 

would be insufficient because it could miss some opportunities to identify these 

potentially new IROLs when they could be material. AEP asserts that, at a minimum, 

reliability coordinators should be required to be involved in SOLs that could border two 

different transmission operators’ areas to ensure the activities are appropriately 

coordinated. AEP states that reliability coordinators and transmission operators should 

develop this subset of SOLs through joint analysis, or agreement. AEP requests that the 

Commission direct NERC to develop a modification to proposed Reliability Standards 

EOP-001-1, IRO-002-2, IRO-004-2, IRO-005-3, TOP-003-1, TOP-005-2, and 

TOP-006-2, to require reliability coordinators to work together with transmission 

operators in developing and monitoring SOLs that border multiple transmission 

operators’ areas. 

2. Documented Methodology to Identify System Operating Limit 

Information

33. NERC asserts that, because proposed Reliability Standard IRO-008-1 requires 

reliability coordinators to use tools to model transmission and generation assets based on 
Docket No. RM10-15-000 - 21 - 

ratings provided by asset owners, it is unnecessary to impose an additional requirement 

that the reliability coordinator have a documented methodology for identifying the SOL 

information it needs because the systems and controls in place already provide the 

information needed by the reliability coordinators. The Joint Commenters also believe 

that such a methodology is unnecessary because, in its defined role, a reliability 

coordinator already will have access to, and be provided with, the appropriate set of 

SOLs from the transmission operator. 

3. Current Practices for the Prevention and Mitigation of SOLs 

and IROLs and the Monitoring Capability of the Reliability 

Coordinator

34. NERC states that current practices give the reliability coordinators the ability to 

provide assessments of the Bulk-Power System to their transmission operators on a 

Wide-Area basis. NERC believes it is unnecessary to require reliability coordinators to 

have additional responsibility to monitor SOLs other than IROLs. NERC also notes that 

there are checks in place that allow the reliability coordinator to monitor SOLs that could 

turn into IROLs. As an example, NERC points out that IRO-010-1a requires reliability 

coordinators to conduct Operational Planning Analyses and Real-Time Assessments to 

identify any IROLs that may be exceeded. 

35. NERC states that the electric power industry is predicated on interdependencies. 

NERC describes the interdependency of transmission operators and reliability 

coordinators as enabling the reliability coordinator both to control IROLs and flows, and 
Docket No. RM10-15-000 - 22 - 

to be aware of local issues, giving the reliability coordinator the ability to monitor SOLs 

that may become IROLs within the reliability coordinators areas. NERC further explains 

that it is working on Project 2007-03 – Real-Time Operations to develop proposed 

revisions to the TOP standards that require a transmission operator to perform 

Operational Planning Analyses for its transmission operator area. NERC states that 

Project 2007-03 is considering revisions to the Reliability Standards that would require 

observation of SOL limits in adjoining areas. 

36. The Joint Commenters state that the proposed IRO Reliability Standards hold 

reliability coordinators to the proper assessment of information required to provide 

accurate assessments on a Wide-Area basis. The Joint Commenters also caution that 

“accurate assessments” do not equate to precise results and the Commission should 

refrain from mandating that reliability coordinators provide accurate assessments. 

4. Reliability Coordinator’s Procedures for Selecting the SOLs for 

Evaluation by the Interchange Distribution Calculator

37. NERC states that reliability coordinators in the Eastern Interconnection select 

which SOLs to evaluate in the interchange distribution calculator based on information 

received from the transmission operators indicating that the transmission operator has a 

facility that is approaching or exceeding its SOL and/or IROL. NERC states that the 

interchange distribution calculator is a congestion management tool that helps the 

reliability coordinators deal with transmission constraints. In the survey conducted by 

NERC of reliability coordinators, one reliability coordinator responded that it publishes 
Docket No. RM10-15-000 - 23 - 

most of its information for use by any entity that may wish to use the information in its 

reliability assessments. Another reliability coordinator responded that it does not enter 

SOLs in its area into the interchange distribution calculator, but flowgates are entered 

into the interchange distribution calculator that may have SOLs or IROLs associated with 

them. Entering the flowgates allows an entity to determine if external schedules are 

impacting the flowgate. 

5. Current Functional Model

38. NERC argues that Version 5 of the NERC Functional Model makes a clear 

distinction between the duties of the reliability coordinator and transmission operator 

with respect to SOLs and IROLs in certain task descriptions.32 Similarly, the Joint 

Commenters state that the latest NERC Functional Model divides reliability components 

and allocates them to “unique” baskets of tasks which include a fundamental reliability 

task to do Wide-Area analysis and another task for local analysis. 

Commission Determination

39. As we stated in the NOPR, we believe that it is appropriate for Reliability 

Standards requirements to offer a clear division of responsibilities among reliability 

coordinators and transmission operators. The preponderance of comments to the NOPR 

supports Commission approval of the Reliability Standards as proposed by NERC, 

 32 See NERC Functional Model at 31, 37. 
Docket No. RM10-15-000 - 24 - 

including the proposed division of responsibilities. For the reasons described below, we 

approve the division of responsibility for SOLs and IROLs among transmission operators 

and reliability coordinators as expressed in the proposed Reliability Standards. 

40. NERC and others suggest that these Reliability Standards are not intended to 

remove all responsibility for the analysis and monitoring SOLs from the reliability 

coordinator. We agree. These Reliability Standards generally establish a clear 

distinction of primary responsibility for SOLs and IROLs between the transmission 

operator and reliability coordinator respectively. As NERC notes, however, the 

reliability coordinator will continue to have the ability and the responsibility to analyze 

and monitor SOLs that could turn into IROLs. For example, Requirements R5 and R6 of 

Reliability Standard IRO-002-2 require the reliability coordinator to monitor the 

important elements that could be critical to SOLs and IROLs within the reliability 

coordinator’s area and surrounding reliability coordinator areas. In addition, the 

proposed IRO Reliability Standards require the reliability coordinator to conduct 

Operational Planning Analyses and Real-time Assessments of its reliability coordinator 

area. As NERC explained, the Operational Planning Analyses look at the expected 

system conditions and potential reliability impacts, with a focus on any impacts that 

affect the Wide-Area. Although a transmission operator lacks the tools to predict the 

impact on the surrounding transmission operator areas due to any changes in flow 
Docket No. RM10-15-000 - 25 - 

between inter-area facilities, a reliability coordinator addresses these facilities in its 

Wide-Area modeling capabilities. 

41. As the Commission noted in its NOPR, Reliability Standard IRO-002-2 continues 

to require each reliability coordinator to monitor SOLs other than IROLs both within its 

reliability coordinator area and in surrounding reliability coordinator areas. Specifically, 

under Requirement R4 of IRO-002-2, each reliability coordinator must have detailed realtime monitoring capability of its reliability coordinator area and sufficient monitoring 

capability of its surrounding reliability coordinator areas to ensure that potential or actual 

SOL or IROL violations are identified and analyzed. In addition, under Requirement R5, 

each reliability coordinator must monitor bulk electric system elements such as 

generators, transmission lines, buses, transformers and breakers that could result in SOL 

or IROL violations within its reliability coordinator area. Further, as the Commission 

noted in the NOPR, the reliability coordinator must resolve potential or actual violations 

of SOL ratings by implementing a local or area-wide transmission loading relief 

procedure under Reliability Standard IRO-006-4.1. 

42. Nevertheless, as noted by NERC and other commenters, there exists a subset of 

“grid-impactive” SOLs other than IROLs that the Commission believes may warrant 

closer analysis by the reliability coordinator, in addition to the analysis being conducted 

by the transmission operator, that focuses on whether these particular “grid-impactive” 

SOLs could become IROLs. The Commission believes that there can be considerable 
Docket No. RM10-15-000 - 26 - 

benefit derived from some overlap in the responsibility for analyzing and monitoring 

these “grid-impactive” SOLs since, by definition, every IROL emanated from an SOL. 

While the proposed Reliability Standards continue to commit the reliability coordinator 

to the analysis and monitoring of SOLs that may become IROLs, a subset of SOLs, such 

as these “grid-impactive” SOLs, may deserve a more defined analysis and monitoring 

role on the part of the reliability coordinator. 

43. We acknowledge NERC’s and industry’s continuing efforts to improve the clarity 

of standard requirements regarding SOLs through the Real-time Operations Standard 

Drafting Team (Project 2007-03). We believe that the issues concerning the analysis and 

monitoring of “grid-impactive” SOLs that we note here can be raised and considered in 

this or other ongoing projects. NERC comments that it is working on Project 2007-03 to 

develop revisions to the TOP Reliability Standards that require transmission operators to 

perform operational planning analyses for their local areas. NERC also comments that 

this project is also considering revisions that would require that SOL limits in adjoining 

areas be observed. In addition, there are other open projects, such as Project 2006-06 — 

Reliability Coordination, which is analyzing appropriate reliability coordinator functions 

and responsibilities. In consideration of these ongoing efforts, we will not direct specific 

modifications to these Reliability Standards and, rather, accept NERC’s commitment to 

exercise its technical expertise to study these issues and develop appropriate revisions to 

applicable Standards as may be necessary. 
Docket No. RM10-15-000 - 27 - 

44. Because the study and monitoring of SOLs and IROLs is an issue at the very core 

of Bulk-Power System reliability, the Commission agrees with EEI that the NERC 

Reliability Coordinators Working Group should engage the issues raised in this 

proceeding with NERC stakeholders, including the NERC Planning and Operating 

committees, to determine whether a need exists to further refine the delineation of 

responsibilities between the reliability coordinator and transmission operator for 

analyzing a class of “grid-impactive” SOLs. Depending on the results of that review, we 

further encourage NERC, working through its standard development process, to develop 

appropriate modifications to these and any other related Reliability Standards as 

necessary. 

B. Operational Analyses and Real-time Assessments

45. In the NOPR, the Commission sought comment on the prudence of using an 

Operational Planning Analysis up to twelve months old. The Commission asked whether 

this timeframe is reasonable or whether the timeframe should be shorter to ensure that the 

analysis is not outdated. In addition, the Commission sought comment on whether the 

definition should include measurable criteria to determine whether it is appropriate to use 

an existing analysis. 

46. Further, the Commission requested comments on the meaning of “immediately 

available data” within the proposed definition of the NERC Glossary definition of RealTime Assessment. The Commission proposed to direct NERC to modify the definition of 
Docket No. RM10-15-000 - 28 - 

“Real-time Assessment” to specify that the type of data to be relied upon by a reliability 

coordinator in conducting a Real-time Assessment must be based on adequate analysis 

capabilities such as state estimation, pre- and post-contingency analysis capabilities 

(thermal, stability, and voltage), and wide-area overview displays referenced in 

Requirement R6 of IRO-002-2. 

Comments

47. In response to the Commission’s questions regarding the use of an existing 

Operational Planning Analysis, NERC states that it is unlikely that a reliability 

coordinator would deliberately rely on an Operational Planning Analysis that does not 

reflect its expected system conditions. NERC asserts that a reliability coordinator will 

rely on a twelve-month old operational planning analysis only if system conditions have 

not changed over that time period. NERC states that the proposed definition of 

Operational Planning Analysis was developed, based on stakeholder comments, to apply 

not only to studies conducted for the day ahead, but also for future use in possibly 

developing requirements for seasonal studies. Thus, NERC explains, the definition 

includes the option of performing an Operational Planning Analysis up to twelve months 

ahead. NERC further explains that the definition includes key elements that provide 

measurable criteria in assessing an entity’s Operational Planning Analysis. 

48. In response to the Commission’s questions regarding the proposed definition of 

Real-time Assessment, NERC and the Joint Commenters state that the industry is 
Docket No. RM10-15-000 - 29 - 

currently working towards consensus on the set of data and capabilities the reliability 

coordinators need to perform their tasks via the Real-time Reliability Monitoring and 

Analysis Capabilities Standards Development Team (Project 2009-02). Accordingly, 

NERC asks the Commission to refrain from directing modifications pending completion 

of the project. 

Commission Determination

49. The Commission approves the definitions of “Operational Planning Analysis” and 

“Real-time Assessment” without modification. 

50. The Commission agrees with NERC that the reliability coordinator should rely on 

a twelve-month old Operational Planning Analysis study only if system conditions have 

not changed from those originally studied. Consistent with the views of NERC, we 

expect that reliability coordinators will rely on Operational Planning Analysis that reflect 

expected system conditions. Accordingly, we accept the definition as proposed. 

51. Similarly, we find it is unnecessary to direct NERC to modify the definition of 

“Real-time Assessment” to specify that the type of data to be relied upon by a reliability 

coordinator in conducting a Real-time Assessment as proposed in the NOPR. Instead, the 

Commission will allow industry to complete Project 2009-02, which is working towards 

consensus on the set of data and capabilities the reliability coordinators need to perform 

their tasks. We expect NERC to use its technical expertise to develop any modifications 
Docket No. RM10-15-000 - 30 - 

to the definition of Real-time Assessment as may be necessary as a result of this ongoing 

project. 

C. Reliability Coordinator Actions to Operate Within IROLs 

52. In the NOPR, the Commission sought comment on whether reliability 

coordinators should have action plans developed and implemented with respect to other 

SOLs apart from IROLs and if so, which SOLs. 

Comments

53. NERC states that transmission operators already are responsible for developing 

action plans for preventing and/or mitigating conditions that cause facility ratings to be 

exceeded. NERC therefore contends that it would add confusion to the process to require 

both the reliability coordinator and transmission operator to develop action plans for 

every SOL. 

54. Similarly, WECC does not believe that reliability coordinators should be required 

to have action plans developed and implemented for SOLs apart from IROLs. WECC 

argues that requiring the reliability coordinator to second guess rather than defer to the 

more granular view and detailed view of the transmission operators or balancing 

authorities undermines and substantially changes the roles of each function without any 

foreseeable benefit to overall reliability. 

 
Docket No. RM10-15-000 - 31 - 

Commission Determination

55. The Commission agrees with NERC that requiring both the reliability coordinator 

and transmission operator to develop action plans for every SOL may add confusion to 

the process. As a result, the Commission approves IRO-009-1, without modification. 

However, the Reliability Coordinator Working Group should further study this issue and 

determine if there is a need for reliability coordinators to have action plans developed and 

implemented with respect to certain grid-impactive SOLs. 

D. IRO-010-1a

56. In the NOPR, the Commission expressed concern that Reliability Standard IRO010-1a does not require reliability coordinators to specify a list of minimum data needed 

for reliable operation of the Bulk-Power System. The Commission, therefore, sought 

comment on whether a minimum list of data is necessary for the effective sharing of data 

between neighboring reliability coordinators and, if so, what data should be included. 

The Commission also sought comment on how compatibility of data between 

neighboring reliability coordinators can be assured without a list of minimum data in this 

proposed Reliability Standard. 

57. In its discussion of Reliability Standard TOP-003-1, the Commission noted that 

Requirement R3 of proposed Reliability Standard IRO-010-1a requires entities to provide 

data and information to the reliability coordinator in accordance with the reliability 

coordinator’s specifications. The Commission expressed concern that this requirement 
Docket No. RM10-15-000 - 32 - 

does not specify outage coordination data and, therefore, the reliability coordinator may 

not receive adequate outage coordination data to support the Operational Planning 

Analysis. Accordingly, the Commission sought comment on whether IRO-010-1a should 

specify necessary outage coordination data. 

Comments

58. NERC, the Joint Commenters and Midwest ISO contend that requiring a minimum 

list of data is not necessary for the effective sharing of data between neighboring 

reliability coordinators. NERC argues that requiring a list of minimum data not only 

could impair an entity’s ability to provide the data to the reliability coordinator quickly, 

but could prevent a reliability coordinator from obtaining needed data quickly. NERC 

also notes that, during the development of the proposed Reliability Standard, the 

reliability coordinators that were polled indicated they already were receiving the data 

they needed without any issues and that the data and information they received varied 

from one reliability coordinator to another. The Joint Commenters argue that it is 

unnecessary to develop such a requirement because two interconnected parties can agree 

upon the appropriate type and level of data it needs from the other, taking into 

consideration their respective tools and capabilities. Midwest ISO argues that many 

reliability coordinators already have developed coordination agreements with their 

neighbors that identify the information necessary for effective data sharing. Midwest 

ISO contends that a generic list of minimum data could be inadequate to meet regional 
Docket No. RM10-15-000 - 33 - 

needs and could create conflicts with existing coordination agreements. Midwest ISO 

further contends that a minimum list could curb creativity and innovation as capabilities 

develop new uses for data. 

59. NERC and the Joint Commenters also urge the Commission to refrain from 

requiring NERC to modify IRO-010-1a to specify the necessary outage coordination data 

for all reliability coordinators. They contend that such an approach would not account 

for the significantly varying facilities located within the reliability coordinators’ area and 

allow for the flexibility to specify the data needed for its respective area. 

60. Reiterating comments it raised during the standard development process, WECC 

opposes the requirement in R1.2 that the parties reach mutual agreement with respect to 

the format of the data and information that the reliability coordinator receives. WECC 

argues that, due to the large number of entities that must provide data to the reliability 

coordinator, the requirement for mutually agreeable formats may cause the reliability 

coordinator to receive data in a multitude of diverse formats. WECC also believes that 

requiring mutually agreeable data formats could delay the submission of data by a 

submitting entity until agreement can be reached via negotiation or dispute resolution. 

WECC argues that more than one party is involved in the formulation of an agreeable 

format yet only a reliability coordinator will be found non-compliant when the reliability 

coordinator and transmission operators or balancing authorities within the reliability 

coordinator area fail to reach an agreement over an acceptable format. 
Docket No. RM10-15-000 - 34 - 

Commission Determination

61. The Commission agrees with commenters that it is unnecessary to direct NERC to 

develop a specific list of minimum data for the effective sharing of data between 

neighboring reliability coordinators under Reliability Standard IRO-010-1a. NERC and 

other entities confirm that reliability coordinators currently obtain necessary data without 

such a specific list. In addition, as commenters point out, a minimum list may conflict 

with coordination agreements currently in place which identify the information necessary 

for effective data sharing. With regard to the concern expressed in the NOPR regarding 

outage coordination data, we accept that reliability coordinators currently obtain 

necessary data. If, in the future, reliability coordinators are not able to obtain the 

necessary outage coordination data, we would ask NERC to consider whether a 

Reliability Standard should be developed for the reliability coordinators to obtain such 

data. 

62. In response to WECC’s concerns about the submission of data in mutually 

agreeable formats under Requirement R1.2, we do not believe any modification is 

necessary. As NERC states in its Petition, by specifying that the format must be mutually 

agreeable, the standard supports efficiency by precluding the submission of data that is in 

a format that cannot be used. We agree. NERC states that current data exchange formats 

are acceptable. Therefore, entities can continue to utilize existing agreements regarding 

data exchange. While disputes may arise in the future, the Reliability Standard does not 
Docket No. RM10-15-000 - 35 - 

dictate a specific dispute resolution process in the interpretation leaving reliability 

coordinators and other entities options for informal resolution of a dispute on the format 

of data and flexibility in choosing a dispute resolution process to reach an agreement. 

63. Accordingly, the Commission approves IRO-010-1a as submitted. 

E. Violation Severity Levels and Violation Risk Factors

64. In the event of a violation of a Reliability Standard, NERC establishes the initial 

value range for the corresponding base penalty amount. To do so, NERC assigns a 

violation risk factor for each requirement of a Reliability Standard that relates to the 

expected or potential impact of a violation of the requirement on the reliability of the 

Bulk-Power System. In addition, NERC defines up to four violation severity levels –

Lower, Moderate, High, and Severe – as measurements for the degree to which the 

requirement was violated in a specific circumstance. 

65. In Order No. 705, the Commission approved 63 of NERC’s 72 proposed violation 

risk factors for the version one FAC Reliability Standards and directed NERC to file 

violation severity level assignments before the version one FAC Reliability Standards 

become effective.33 Subsequently, NERC developed violation severity levels for each 

requirement of the Commission-approved FAC Reliability Standards, as measurements 

for the degree to which the requirement was violated in a specific circumstance. 

 33 Facilities Design, Connections and Maintenance Reliability Standards, Order 

No. 705, 121 FERC ¶ 61,296, at P 137 (2007). 
Docket No. RM10-15-000 - 36 - 

 

66. On June 19, 2008, the Commission issued its Violation Severity Level Order 

approving the violation severity level assignments filed by NERC for the 83 Reliability 

Standards approved in Order No. 693.34 In that order, the Commission offered four 

guidelines for evaluating the validity of violation severity levels, and ordered a number of 

reports and further compliance filing to bring the remainder of NERC’s violation severity 

levels into conformance with the Commission’s guidelines. The four guidelines are: (1) 

violation severity level assignments should not have the unintended consequence of 

lowering the current level of compliance; (2) violation severity level assignments should 

ensure uniformity and consistency among all approved Reliability Standards in the 

determination of penalties;35 (3) violation severity level assignments should be consistent 

with the corresponding requirement; and (4) violation severity level assignments should 

be based on a single violation, not a cumulative number of violations.36 The Commission 

found that these guidelines will provide a consistent and objective means for assessing, 

inter alia, the consistency, fairness and potential consequences of violation severity level 

assignments. The Commission noted that these guidelines were not intended to replace 

34 Violation Severity Level Order, 123 FERC ¶ 61,284. 

35 Guideline 2 contains two sub-parts: (a) the single violation severity level 

assignment category for binary requirements should be consistent and (b) violation 

severity levels assignments should not contain ambiguous language. 

36 Violation Severity Level Order, 123 FERC ¶ 61,284 at P 17. 
Docket No. RM10-15-000 - 37 - 

NERC’s own guidance classifications, but rather, to provide an additional level of 

analysis to determine the validity of violation severity level assignments. 

67. On August 10, 2009, NERC submitted an informational filing setting forth a 

summary of revised guidelines that NERC intends to use in determining the assignment 

of violation risk factors and violation severity levels for Reliability Standards. NERC 

states that these revised guidelines were consistent with Commission’s guidelines. On 

May 5, 2010, NERC submitted the subject informational filing as a supplement to its 

pending March 5, 2010 Violation Severity Level Order compliance filing.37

NERC Proposal

68. NERC proposes a complete set of violation severity levels and violation risk 

factors for proposed new Reliability Standards IRO-008-1, IRO-009-1, and IRO-010-1a. 

In addition, NERC proposes to apply the existing set of violation severity levels and 

violation risk factors assigned to the proposed modified requirements. 

69. NERC states that it developed the violation severity levels for the new IRO 

Reliability Standards before the Commission issued its June 19, 2008 Order on violation 

severity levels.38 NERC also notes that the proposed violation severity levels were 

 37 North American Reliability Corporation, Filing of the North American Electric 

Reliability Corporation regarding the Assignment of Violation Risk Factors and Violation 

Severity Levels, Docket No. RR08-4-005 (filed May 5, 2010). 

38 Id. 
Docket No. RM10-15-000 - 38 - 

 

developed before NERC proposed a new methodology for assigning violation severity 

levels and violation risk factors.39 As a result, NERC states that some of the proposed 

violation severity levels do not comport with the Commission’s guidelines on violation 

severity levels and some do not comport with the NERC’s revised guidelines. NERC 

identified differences and committed to propose revisions to the violation severity levels. 

70. Separately from NERC’s Petition here, on March 5, 2010, NERC submitted the 

first of two VSL compliance filings (Filing 1) to the Commission’s VSL Orders,40 which 

contained the VSL assignments for the original set of 83 Reliability Standards approved 

by the Commission and NUC-001-2. In addition, NERC requested an extension for filing 

the remaining VSLs until the 3rd quarter of 2010. On July 6, 2010, the Commission 

issued a Notice of Extension of Time up to and including December 1, 2010, for Filing 

2.41 On December 1, 2010, NERC submitted a compliance filing to the Commission in 

Docket No. RR08-04-006 (Filing 2). In Filing 2, NERC submitted VSLs both for 

Reliability Standards that are pending at the Commission and Reliability Standards 

39 NERC, Informational Filing Regarding the Assignment of Violation Risk 

Factors and Violation Severity Levels, Docket Nos. RM08-11-000, RR07-9-000, and 

RR07-10-000 (filed Aug. 10, 2009). 

40 North American Electric Reliability Corp., 123 FERC ¶ 61,284 (2008), order on 

reh’g, 125 FERC ¶ 61,212 (2008) (VSL Orders). 

41 North American Electric Reliability Corporation, Docket No. RR08-4-005 (Jul. 

6, 2010) (granting an extension of time for submitting this VSL compliance filing up to 

and including December 1, 2010). 
Docket No. RM10-15-000 - 39 - 

previously approved by the Commission. Filing 2 includes VSLs to supersede those in 

NERC’s Petition in Docket No. RM10-15-000 for EOP-001-1, IRO-002-2, IRO-004-2, 

IRO-005-3, IRO-008-1, IRO-009-1, IRO-010-1, IRO-010-1a, TOP-003-1, TOP-005-2, 

and TOP-006-2.42

NOPR Proposal

71. In the NOPR, the Commission proposed to accept the proposed violation risk 

factors and violation severity levels presented in NERC’s petition. In addition, the 

Commission proposed to accept NERC’s commitment to review the proposed violation 

risk factors and violation severity levels to ensure compliance with the Commission’s 

guidelines. Accordingly, we proposed to direct NERC to submit a compliance filing 

within six months of the effective date of the final rule in this proceeding that would 

provide the results of NERC’s review including any modifications necessary to comply 

with the Commission’s guidelines on violation risk factors and violation severity levels. 

Commission Determination

72. Because a determination has not yet been made regarding NERC’s “roll-up” 

approach pending before the Commission in Docket Nos. RR08-4-005 and RR08-4-006, 

the Commission will defer discussion on the proposed violation risk factors and violation 

 42 See NERC, Compliance Filing, Docket No. RR08-4-006, at 2 n.6 (filed Dec. 1, 

2010). 
Docket No. RM10-15-000 - 40 - 

severity levels assigned to IRO-008-1, IRO-009-1, and IRO-010-1a, until after the 

Commission issues a final order acting on NERC’s petition in these proceedings. 

III. Information Collection Statement

73. The information collection requirements in this Final Rule are identified under the 

Commission data collection FERC-725A, “Mandatory Reliability Standards for the BulkPower System.” The information collection requirements are being submitted to the 

Office of Management and Budget (OMB) for review under section 3507(d) of the 

Paperwork Reduction Act of 1995.43 OMB’s regulations require OMB to approve certain 

information collection requirements imposed by agency rule.44

74. The Commission approves new Reliability Standards IRO-008-1, IRO-009-1, and 

IRO-010-1a; revised Reliability Standards EOP-001-1, IRO-002-2, IRO-004-2, IRO-005-

3, TOP-003-1, TOP-005-2, and TOP-006-2; and the two new NERC Glossary terms: 

“Operational Planning Analysis” and “Real-time Assessment.” The three new Reliability 

Standards (IRO-008-1, IRO-009-1 and IRO-010-1a, governing reliability coordinator 

analyses, operational actions and data collection) replace parts of the currently-effective 

Reliability Standards EOP-001-0, IRO-002-1, IRO-004-1, IRO-005-2, TOP-003-0, TOP005-1 and TOP-006-1 approved by the Commission in Order No. 693. 

 43 44 U.S.C. 3507(d). 

44 5 CFR 1320.11. 
Docket No. RM10-15-000 - 41 - 

75. Thus, this final rule does not impose entirely new burdens on the affected entities. 

With the exception of the addition of Interchange Authority as an applicable entity in 

IRO-010-1a, the currently-effective standards EOP-001-0, IRO-002-1, IRO-004-1, IRO005-2, TOP-003-0, TOP-005-1 and TOP-006-1 require actions by the same applicable 

group of entities. IRO-010-1a clarifies that balancing authorities, generator owners, 

generator operators, interchange authorities, load-serving entities, reliability coordinators, 

transmission operators, and transmission owners shall provide data and information, as 

specified, to the reliability coordinator(s) with which it has a reliability relationship.45 

The requirements of IRO-008-1 and IRO-009-1 provide clarification from existing 

requirements, dictating the analysis and operational roles of the reliability coordinator. 

76. Public Reporting Burden: Our estimate below regarding the number of 

respondents is based on the NERC compliance registry as of September 28, 2010. 

According to the NERC compliance registry, there are 134 balancing authorities, 824 

generator owners, 773 generator operators, 61 interchange authorities, 541 load-serving 

entities, 26 reliability coordinators, 178 transmission operators, and 332 transmission 

owners that would be involved in providing information. However, under NERC’s 

compliance registration program, entities may be registered for multiple functions, and as 

such there is some duplication of functions regarding the number of registered entities 

 45 Proposed Reliability Standard IRO-010-1a, Requirement R3 
Docket No. RM10-15-000 - 42 - 

that would be required to provide information. Given these parameters, the Commission 

estimates that the Public Reporting burden for the requirements contained in the final rule 

is as follows: 

FERC-725A 

Data 

Collection 

No. of 

Respondents 

(A) 

No. of 

Annual 

Responses 

(B) 

Hours Per 

Respondent 

(C) 

Total Annual 

Hours 

(A X B X C) 

Reliability 

Coordinators 

distribution of 

data 

specification to 

entities 

26 1* 8 208 

Balancing 

Authorities, 

Generator 

Owners, 

Generator 

Operators, 

Interchange 

Authorities, 

Load-serving 

Entities, 

Reliability 

Coordinators, 

Transmission 

Operators, and 

Transmission 

Owners 

reporting data 

to their 

Reliability 

Coordinator 

1501 1* 8 12,008 

Total 12,216 

*As needed 
Docket No. RM10-15-000 - 43 - 

 Total Information Collection Costs: The Commission estimated that it would 

require 12,216 total annual hours for the information collection (reporting and 

recordkeeping) and that the average annualized costs would be $1,465,920 (12,216 

hours @ $120/hour) 

Title: FERC-725A, Mandatory Reliability Standards for the Bulk-Power System. 

. 

Action: Proposed Revision to FERC-725A. 

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 Final Rule approves three Reliability Standards that 

pertain to interconnection reliability operating limits and seven modified Reliability 

Standards that pertain to emergency preparedness and operations, interconnection 

reliability operations and coordination, and transmission operations. This Final Rule also 

approves the addition of two new terms to the NERC Glossary of Terms. The Reliability 

Standards that pertain to interconnection reliability operating limits will require reliability 

coordinators and transmission operators to coordinate data on system operating limits and 

interconnection reliability operating limits. This Final Rule finds the Reliability 

Standards and related definitions just, reasonable, not unduly discriminatory or 

preferential, and in the public interest. 

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

contacting: Federal Energy Regulatory Commission, Attn: Ellen Brown, Office of the 

Executive Director, 888 First Street, NE Washington, DC 20426, Email: 
Docket No. RM10-15-000 - 44 - 

DataClearance@ferc.gov, Tel: (202) 502-8663, Fax: (202) 273-0873. Comments on the 

requirements of this final rule may also be sent 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]. For security 

reasons, comments should be sent by e-mail to OMB at oira_submission@omb.eop.gov. 

Please reference OMB Control Number 1902-0244, RIN 1902-AE17, and the docket 

number of this final rule in your submission. 

IV. Environmental Analysis

78. 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.46 The Commission has categorically excluded certain 

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

environment. The actions directed here fall within the categorical exclusion in t

Commission’s regulations for rules that are clarifying, corrective or procedural, fo

information gathering, analysis, and dissemination.

he 

r 

sessment is required. 

 

47 Accordingly, neither an 

environmental impact statement nor environmental as

46 Regulations Implementing the National Environmental Policy Act, Order No. 

486, 52 FR 47897 (Dec. 17, 1987), FERC Stats. & Regs., Regulations Preambles 1986-

1990 ¶ 30,783 (1987). 

47 18 CFR 380.4(a)(5) (2010). 
Docket No. RM10-15-000 - 45 - 

V. Regulatory Flexibility Act

79. The Regulatory Flexibility Act of 1980 (RFA)48 generally requires a description 

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

number of small entities. The requirements of this rule would apply primarily to 

reliability coordinators, which do not fall within the definition of small entities.49 

Moreover, the proposed Reliability Standards reflect a continuation of existing 

requirements for reliability coordinators and other entities to monitor, analyze, prevent, 

and mitigate the occurrence of operating limit violations on the Bulk-Power System. The 

one exception is the proposed new requirements in Reliability Standard IRO-010-1a for 

interchange authorities, which also do not fall within the definition of small entities. 

Based on the foregoing, the Commission certifies that this proposed rule will not have a 

significant impact on a substantial number of small entities. Accordingly, no regulatory 

flexibility analysis is required. 

VI. Document Availability

80. 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 

 48 5 U.S.C. 601-612. 

49 The RFA definition of “small entity” refers to the definition provided in the 

Small Business Act (SBA), which defines a “small business concern” as a business that is 

independently owned and operated and that is not dominant in its field of operation. See

15 U.S.C. 632. According to the SBA, a small electric utility is defined as one that has a 

total electric output of less than four million MWh in the preceding year. 
Docket No. RM10-15-000 - 46 - 

contents of this document via the Internet through FERC's Home Page 

(http://www.ferc.gov) and in FERC's Public Reference Room during normal business 

hours (8:30 a.m. to 5:00 p.m. Eastern time) at 888 First Street, NE, Room 2A, 

Washington DC 20426. 

81. From FERC's Home Page on the Internet, this information is available on 

eLibrary. The full text of this document is available on eLibrary in PDF and 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. 

82. User assistance is available for eLibrary and the FERC’s website during normal 

business hours from FERC Online Support at 202-502-6652 (toll free at 1-866-208-3676) 

or email at ferconlinesupport@ferc.gov, or the Public Reference Room at (202) 502-

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

public.referenceroom@ferc.gov. 

VII. Effective Date and Congressional Notification

83. These regulations are effective [insert date 60 days from publication in 

FEDERAL REGISTER]. The Commission has determined, with the concurrence of the 

Administrator of the Office of Information and Regulatory Affairs of OMB, that this rule 

is not a “major rule” as defined in section 351 of the Small Business Regulatory 

Enforcement Fairness Act of 1996. 
Docket No. RM10-15-000 - 47 - 

List of subjects in 18 CFR Part 40 

Electric power, Electric utilities, Reporting and recordkeeping requirements. 

By the Commission. 

( S E A L ) 

Nathaniel J. Davis, Sr., 

Deputy Secretary.