151 FERC ¶ 61,046

UNITED STATES OF AMERICA

FEDERAL ENERGY REGULATORY COMMISSION

Before Commissioners: Norman C. Bay, Chairman;

 Philip D. Moeller, Cheryl A. LaFleur,

Tony Clark, and Colette D. Honorable.

Standards for Business Practices and Communication 

Protocols for Public Utilities

 Docket No. RM05-5-024

ORDER ON REHEARING

Paragraph Numbers

I. Background ............................................................................................................................2.

II. Discussion .............................................................................................................................4.

A. Posting Requirements for ATC Narratives......................................................................4.

B. Redirect Policies...............................................................................................................6.

C. Conflicts between Standards and Tariffs..........................................................................11.

D. Applicability of Standards WEQ-015 and WEQ-021......................................................17.

E. Implementation Schedule for OASIS Template Interactions...........................................22.

F. Implementation Schedule for PKI Standard (WEQ-012).................................................25.

(Issued April 16, 2015)

1. In this order, we grant clarification, in part, but otherwise deny requests for 

rehearing and/or clarification by the Edison Electric Institute (Edison) and the New York 

Independent System Operator, Inc. (NYISO) of Order No. 676-H, a final rule in this 

proceeding that incorporated by reference the latest version of certain business practice 

standards for public utilities developed by the Wholesale Electric Quadrant (WEQ) of the 

North American Energy Standards Board (NAESB).

1

 1 Standards for Business Practices and Communication Protocols for Public 

Utilities, Order No. 676-H, 79 Fed. Reg. 56,939 (Sept. 24, 2014), FERC Stats. & Regs. 

¶ 31,359 (2014) (Order No. 676-H or Final Rule).
Docket No. RM05-5-024 - 2 -

I. Background

2. On September 18, 2014, the Commission issued the Final Rule that amended its 

regulations under the Federal Power Act (FPA)2 to incorporate by reference into its 

regulations as mandatory enforceable requirements, with certain enumerated exceptions, 

the latest version (Version 003) of the Standards for Business Practices and 

Communication Protocols for Public Utilities adopted by NAESB’s WEQ and filed with 

the Commission as a package on September 18, 2012, as modified in a report filed with 

the Commission on January 30, 2013. In that same final rule, the Commission listed 

NAESB’s Smart Grid Standards (Standards WEQ-016, WEQ-017, WEQ-018, WEQ-019 

and WEQ-020) in Part 2 of the Commission’s Regulations, but did not incorporate these 

standards by reference into its regulations.

3

3. In response to the Final Rule, Edison and NYISO each filed a request for 

rehearing and/or clarification. Edison seeks rehearing of nine separate findings made by 

the Commission in the Final Rule. NYISO requests a 24-month implementation period

for WEQ-012, the business practice standard prescribing public key infrastructure (PKI) 

requirements, rather than the roughly seven months prescribed by the Final Rule and 

subsequent extension.

4

II. Discussion

A. Posting Requirements for ATC Narratives

4. In Order No. 676-E, the Commission declined to incorporate by reference WEQ

Standards WEQ-001-14.1.3 and WEQ-001-15.1.2, which addressed the posting of 

narratives explaining the calculation of Available Transfer Capability (ATC) on a 

transmission provider’s Open Access Same-time Information Site (OASIS), because it 

found that these standards were inconsistent with the Commission’s rejection in Order 

No. 890 of delays in posting data.5

 In WEQ Version 003, NAESB modified these two 

standards to provide that Transmission Providers should strive to post their ATC 

narratives within one business day and are required to make this posting within five 

business days. In the Final Rule, the Commission declined to incorporate by reference 

 2 16 U.S.C. § 791a, et seq. (2012).

3 18 C.F.R. § 2.27 (2014), 79 Fed. Reg. 56,954 (Sept. 24, 2014).

4 80 Fed. Reg. 3880 (Jan. 26, 2015).

5 Standards for Business Practices and Communication Protocols for Public 

Utilities, Order No. 676-E, FERC Stats. & Regs. ¶ 31,299, at P 39 (2009).
Docket No. RM05-5-024 - 3 -

NAESB Standards WEQ-001-14.1.3 and WEQ-001-15.1.2 because the standards did not 

meet the Commission’s requirement in Order No. 890 to post the ATC narrative “as soon 

as feasible.”6

 The Commission stated that posting within one day would be consistent 

with Order No. 890.7

 The Commission explained in the Final Rule that there was no 

reason shown why five business days would be needed to post an ATC Narrative and 

reiterated that one day appears reasonable.

5. Edison argues on rehearing that the Commission should clarify that it intended in 

the Final Rule to advise NAESB that Standards WEQ-001-14.1.3 and WEQ-001-15.1.2 

would satisfy Order No. 890 if they were revised to require postings “within one business 

day” rather than “within one day.” We clarify that a standard requiring the posting of 

ATC narratives within one business day appears reasonable and consistent with Order 

No. 890. If the industry finds that posting within one business day is not feasible, 

NAESB should include a detailed explanation of why this is not feasible and why the 

time period it chooses is as quickly as is feasible.

B. Redirect Policies

6. In the Final Rule, the Commission declined to incorporate by reference Standards 

WEQ-001-9.5 and WEQ-001-10.5 as inconsistent with the Commission’s Dynegy

policy.8

 The Commission determined that the WEQ-001-9.5 standard as written would 

 6 See Preventing Undue Discrimination and Preference in Transmission Service, 

Order No. 890, FERC Stats. & Regs. ¶ 31,241, at P 370, order on reh’g, Order No. 890-

A, FERC Stats. & Regs. ¶ 31,261 (2007), order on reh’g, Order No. 890-B, 123 FERC 

¶ 61,299 (2008), order on reh’g, Order No. 890-C, 126 FERC ¶ 61,228, order on 

clarification, Order No. 890-D, 129 FERC ¶ 61,126 (2009).

7 Order No. 676-H, FERC Stats. & Regs. ¶ 31,359 at P 28.

8 In 2001, in Dynegy Power Marketing, Inc. v. Southwest Power Pool, Inc., 96 

FERC ¶ 61,275 (2001), order granting clarification and dismissing reh‘g, 99 FERC 

¶ 61,054 (2002) (Dynegy), the Commission granted Dynegy’s complaint and found that 

provisions in the Southwest Power Pool, Inc. tariff were inconsistent with those in the 

Commission’s pro forma tariff established in Order No. 888. 96 FERC ¶ 61,275 at 

62,048. In its order on rehearing, the Commission clarified that “a transmission customer 

does not lose its rights to its original path until the redirect request satisfies all of the 

following criteria: (1) it is accepted by the transmission provider; (2) it is confirmed by 

the transmission customer; and (3) it passes the conditional reservation deadline under 

section 13.2.” 99 FERC ¶ 61,054 at P 9. The Commission recently affirmed this policy 

under Order No. 890 in Entergy Services, Inc., 137 FERC ¶ 61,199 (2011), order on 

reh’g and compliance, 143 FERC ¶ 61,143 (2013), order on reh’g, 148 FERC ¶ 61,209, 

at P 12 (2014).
Docket No. RM05-5-024 - 4 -

reduce the “Capacity Available to Redirect” before a redirect has passed the conditional 

reservation deadline. Also, in the Final Rule the Commission determined that Standard 

WEQ-001-10.5 provides that the capacity available for a redirect will be reduced at the 

time when the request for a firm redirect is confirmed, which precedes expiration of the 

conditional reservation deadline. Because NAESB standards must conform to the 

Commission’s Dynegy policy before the Commission would incorporate them by 

reference, the Commission requested that NAESB revise Standards WEQ-001-9.5, WEQ001-10.5, and any other standards affected by those standards, to conform to the

Commission’s Dynegy policy.

7. Edison argues that the Commission erred by arbitrarily and capriciously finding 

that Standard WEQ-001-9.5 and Standard WEQ-01-10.5 do not meet the standards set in 

the Commission’s precedent and argues that the Commission failed to provide a rational 

explanation for its findings. In its rehearing request, Edison does not dispute that the 

Commission’s policy on redirects was established in Dynegy, nor does it argue that the

Commission’s Dynegy policy should be abandoned or revised. Instead, it argues that 

NAESB’s Standards WEQ-001.9.5 and WEQ-001-10.5 already operate in accordance 

with the Commission’s Dynegy policy.

8. In this regard, Edison argues that the term “Capacity Available to Redirect,” which 

is defined in WEQ-000 (Abbreviations, Acronyms, and Definition of Terms) as “the 

granted capacity of the Parent Reservation at the time of Transmission Customer 

confirmation ..., less all ... confirmed Redirects on a firm basis [and] confirmed 

Redirects on a non-firm basis ....” does not mean the parent reservation is reduced.

9

 

Rather, Edison contends, it refers only to the amount of capacity available to be 

redirected by the transmission customer.10 Consequently, Edison argues that, under the 

existing NAESB Standards, reducing the “Capacity Available to Redirect” does not 

change or reduce the Parent Reservation’s capacity, but rather it identifies unused 

capacity on a reservation that may be redirected (either as a firm redirect or as a non-firm 

redirect).11 If the redirect request does not survive the conditional reservation deadline, 

Edison maintains that the “Capacity Available to Redirect” will be credited with the 

appropriate amount. In addition, Edison expresses a concern that, without this 

mechanism in place, transmission customers would be able to acquire transmission rights 

in excess of the parent reservation.

 9 Edison Rehearing at 6-7.

10 Id. at 7.

11 Id.
Docket No. RM05-5-024 - 5 -

9. We deny rehearing. There are two problems with Edison’s argument. First, the 

current language of the standards, by referring to the capacity available to redirect,

suggests that the parent reservation will be reduced and utilities have interpreted it in like 

fashion.

12 Even if Edison’s argument had merit, it nonetheless illustrates that the current 

language of the standards is not clear and should be revised to make clear that it conforms 

to the Commission’s Dynegy policy.13

10. Second, putting aside the question of how “Capacity Available for Redirect” is 

processed, the standards themselves only refer to confirmed redirects and are silent as to 

what is to take place between the time when a reservation is confirmed and when it 

becomes unconditional. Accordingly, because these standards are vague enough to allow

some transmission operating utilities to interpret them in a manner that conflicts with the 

Commission’s Dynegy policy, and because they appear not to address the appropriate 

calculation of available redirect capacity in some circumstances, the Commission 

continues to decline to incorporate these standards by reference into its regulations.

C. Conflicts between Standards and Tariffs

11. As explained in the Final Rule, PJM Interconnection, L.L.C. (in its comments to 

the notice of proposed rulemaking that preceded issuance of the Final Rule14) requested 

clarification that, if there is a conflict between terms of a Commission-approved tariff and 

NAESB Business Practice Standards, the tariff takes precedence and that a Regional 

Transmission Organization (RTO) or Independent System Operator (ISO) following the 

terms of its Commission-approved tariff need not seek waiver of specific NAESB 

standards to avoid being deemed in violation of the standards. In the Final Rule, the 

Commission adopted revised procedures that should prevent a conflict between a public 

utility’s existing tariff and newly-incorporated by reference NAESB standards.

12. In its request for rehearing, Edison renews PJM’s arguments, alleging that the 

Commission erred by failing to specify in the Final Rule that, in event of a conflict 

between the terms of a Commission-approved tariff and the NAESB business standards, 

that the tariff takes precedence. Edison argues that such a clarification is needed to avoid 

exposing Transmission Providers to the possibility that they might be subject to 

conflicting provisions within the same rate schedule.

 12 Entergy Services, Inc., 148 FERC ¶ 61,209 at PP 9, 12.

13 See supra n.8.

14 Standards for Business Practices and Communication Protocols for Public 

Utilities, Notice of Proposed Rulemaking, FERC Stats. & Regs. ¶ 32,698 (2013).
Docket No. RM05-5-024 - 6 -

13. We deny Edison’s request for rehearing. Under the revised procedures adopted in 

the Final Rule, after the issuance of a final rule, the public utility must make a 

compliance filing to make necessary revisions to its tariff to reference the NAESB 

standards, as appropriate, or to request waiver of those standards, as appropriate.15 In 

each case, every standard must be identified in a single section of the public utility’s tariff 

with an indication whether 1) it is incorporated by reference, 2) is subject to a waiver 

request, or 3) whether compliance is covered by another tariff provision (with the tariff 

provision identified). Under this process, any deviations or waiver of the standards will 

have been noticed in the filing and any tariff provision accepted by the Commission will 

take precedence over the standards.

14. In a related argument, Edison objects to the Commission’s directive that all 

potential conflicts between the terms of a Commission-approved tariff and the NAESB 

business practice standards should be identified by the December 1, 2014 filing deadline 

and relying on utilities pursuing the waiver process in advance of a potential conflict. In 

Edison’s view, not all such conflicts would be known prior to implementation. Edison 

also requests notice of what to do should such a conflict arise.16

15. As explained above, when the public utility submits a compliance filing, it will 

need to include in its tariff a section either incorporating each standard by reference or 

identifying where in its tariff it complies with that standard. Edison appears to be 

suggesting that a public utility inadvertently may incorporate by reference a standard 

while it has an inconsistent provision in its tariff. In that situation, both provisions are 

tariff provisions and the Commission cannot determine a priori how it will resolve a 

tariff inconsistency. That may depend on the facts and circumstances of individual cases. 

Should the public utility discover such an inconsistency, it should make an FPA section 

205 filing to resolve the discrepancy.

16. Edison also argues that the Commission failed to explain that it intended to adopt 

standards that may revise the pro forma Open Access Transmission Tariff (OATT) and 

failed to provide notice to industry that it was proposing to revise the requirements set 

forth in a Commission-approved OATT. This argument mischaracterizes the 

Commission’s action in the Final Rule. In the Final Rule, the Commission incorporated 

by reference certain NAESB standards into the Commission’s regulations at 18 C.F.R.

Part 38. Nowhere in the Final Rule did the Commission revise the pro forma OATT. As 

 15 A public utility will not be required to make a compliance filing only if its tariff 

incorporates into its tariff all the standards incorporated by reference by the Commission 

as specified in Part 38 of the Commission’s Rules of Practice and Procedure as updated 

and revised. Order No. 676-H, FERC Stats. & Regs. ¶ 31,359 at P 71.

16 Edison Rehearing at 12.
Docket No. RM05-5-024 - 7 -

the Commission did not revise the pro forma OATT in the Final Rule, Edison’s objection 

is without basis. Moreover, Edison does not identify any standards that the Commission 

incorporated by reference in the Final Rule that it alleges are in conflict with, and 

override, the pro forma tariff. Indeed, when the standards do deviate from the pro forma

OATT, the Commission declines to incorporate them by reference as occurred with 

respect to the redirect standards. In any event, the objection ignores that the Commission 

afforded adequate notice and opportunity for comment before issuing the Final Rule, 

which is all that due process required.

D. Applicability of Standards WEQ-015 and WEQ-021

17. Edison argues on rehearing that the Commission erred in the Final Rule by failing 

to specify that NAESB business practice standards WEQ-015 (Measurement and 

Verification of Wholesale Electricity Demand Response) and WEQ-021 (Measurement 

and Verification of Energy Efficiency Products) only apply in markets administered by 

RTOs and ISOs, and that Transmission Providers that are not located in RTOs or ISOs 

are not required to adopt or follow these standards.

18. No such statement was needed in the Final Rule. Standard WEQ-015 and WEQ021 both state on their face that they only apply to markets administered by 

RTOs/ISOs.

17 Additionally, in Order No. 676-G, the Commission’s Final Rule 

incorporating by reference NAESB’s business practice standards to categorize various 

products and services for demand response and energy efficiency and to support the 

measurement and verification of these products and services in organized wholesale 

electric markets, the Commission stated specifically that

the particular standards we are incorporating by reference in this 

Final Rule apply only in organized wholesale electric markets 

administered by RTOs or ISOs. NAESB made this clear in the 

applicability section of its standards, and we do not see any need to 

further amend 18 C.F.R. § 38.2.[18]

 17 See Applicability statements in WEQ-015 and in WEQ-021-2.1.1.

18 Standards for Business Practices and Communication Protocols for Public 

Utilities, Order No. 676-G, FERC Stats. & Regs. ¶ 31,343, at P 37 (2013). Also see id. 

P 50, where we reiterated that the “standards that we are incorporating by reference are 

sufficiently clear that the standards apply to organized wholesale electric markets 

administered by RTOs or ISOs.”
Docket No. RM05-5-024 - 8 -

19. Additionally, we clarify that, whenever a standard specifically states on its face 

that it only applies to certain types of entities, there is no need for other entities outside of 

that grouping (i.e., those to whom the requirement is not applicable) to obtain a waiver of 

that standard to be excused from compliance, as those standards clearly do not apply to 

them. This being the case, we shall hereafter dismiss as unnecessary any requests for 

waivers of standards that by their terms specifically apply only to entity groups (e.g., 

balancing authorities or western utilities or RTOs/ISOs) that the potential waiver 

requestor does not belong to during the time those standards are effective.

20. Requiring a public utility to file (and the Commission to process) a waiver request 

for standards that on their face specifically state are only applicable to entity groups that 

the potential waiver requestor does not belong to is an unnecessary expenditure of time 

and effort for both the potential waiver requestors and the Commission, since the 

standard itself makes clear to whom it applies.19 Including such standards in the public 

utility’s tariff will have no adverse effects on the company, since the standards would not 

impose a compliance obligation on that company as long as it is not the target of the 

compliance obligation prescribed by the standard.

21. Moreover, in each public utility’s compliance filing in which it submits a tariff 

revision incorporating the NAESB standards, the public utility must either incorporate by 

reference each standard or indicate in its tariff that it has obtained a waiver of that 

standard. No standard should be excluded or considered implicitly.

E. Implementation Schedule for OASIS Template Interactions

22. In the Final Rule, the Commission required public utilities to make compliance 

filings by December 1, 2014 in order to achieve compliance with the incorporated 

Version 003 business practice standards by February 2, 2015, with the exception of those 

standards related to the Network Integration Transmission Service (NITS) OASIS 

template, for which compliance is required by April 25, 2016. The February 2, 2015 

deadline was subsequently extended until May 15, 2015 and all other compliance 

obligations set forth in the Final Rule were unchanged and remained in force.20 Thus, all 

components of the Final Rule have been set for a May 15, 2015 implementation with the 

exception of the requirements related to the NITS OASIS template.

 19 For example, standard WEQ-006-9 WESTERN INTERCONNECTION TIME 

ERROR NOTIFICATION applies only to western entities using the WECCNet system. 

Similarly, as pointed out by Edison, the demand response measurement and verification 

standards are limited in the applicability section to ISOs and RTOs.

20 80 Fed. Reg. 3880 (Jan. 26, 2015).
Docket No. RM05-5-024 - 9 -

23. On rehearing, Edison argues that the Commission erred by failing to specify that 

the implementation schedule for all OASIS template interactions (including Service 

Across Multiple Transmission Systems(SAMTS)) is 18 months after the effective date of 

the Final Rule. It argues that the industry needs additional time to comply with all the 

new OASIS standards, and not just those involving the NITS OASIS template and that 

not allowing its requested timeline would be more burdensome than allowing an 18-

month schedule for all OASIS requirements. With regard to the SAMTS requirements, in 

particular, Edison argues that, because an increment of a SAMTS request may be 

network service and the NITS business practice standards will not be implemented until 

2016, SAMTS service may not be available to fully implement a SAMTS request that 

contains a network service increment.21

24. We find that the contentions by Edison as to the need for an extended compliance 

timetable for all the new OASIS requirements are general and non-specific and do not 

justify an across-the-board revision to the required timetable. If a particular public utility 

encounters specific problems that will prevent its compliance with these requirements in 

a timely manner it can ask for an extension for itself, and the merits of such a request will 

be considered on a case-by-case basis.

F. Implementation Schedule for PKI Standard (WEQ-012)

25. In the Final Rule, the Commission established the same timetable for compliance 

with the PKI requirements in WEQ-012 as it established for all the requirements of the 

Final Rule not related to the transition to the NITS OASIS template (i.e., by May 15, 

2015).22

26. On rehearing, NYISO argues that the Commission erred by failing to provide a 24-

month implementation schedule for PKI. Specifically, NYISO asks the Commission to 

reverse its unexplained rejection of the ISO/RTO Council’s request that Transmission 

Providers be given 24 months to come into compliance with the new PKI standards in 

WEQ-012 of the newly accepted WEQ Version 003 standards. It goes on to state that the 

ISO/RTO Council set forth substantial technical and process reasons why additional time 

would be needed to comply with the PKI standards and these were not addressed in the 

Final Rule.

 21 Edison Rehearing at 17-18.

22 See Order No. 676-H, FERC Stats. & Regs. ¶ 31,359 at P 95.
Docket No. RM05-5-024 - 10 -

27. Standard WEQ-012 specifies the requirements that a certificate authority must 

meet to claim that the electronic certificates issued by that certificate authority meets 

Standard WEQ-012. This standard also describes the minimum requirements that public 

utilities and RTOs/ISOs using PKI must meet to achieve compliance with the NAESB 

Business Practice Standard WEQ-012.

28. In addition to filing its request for rehearing in the instant proceeding, NYISO 

filed a compliance filing in Docket No. ER15-550-000 to implement NAESB’s new 

business practice standards and requested the same 24-month compliance schedule for 

implementing the PKI standards applicable to OASIS transactions conducted on 

NYISO’s Market Information System (MIS) that it requests on rehearing. In its request 

for rehearing of the Final Rule, NYISO states that it anticipated seeking an extension of 

the deadline for PKI compliance in its forthcoming compliance filing and that, if this 

request for an extension is granted, it will withdraw its limited request for rehearing of 

the Final Rule. This request for an extension has been granted.23 No other interested 

person filed for rehearing of the PKI compliance timetable established in the Final 

Rule.24 Given that NYISO’s request for an extension of the PKI compliance schedule has 

already been granted in a notice of extension issued in Docket No. ER15-550-000, 

NYISO’s request to withdraw its request for rehearing of the PKI standards established in 

the Final Rule is accepted.

 23 In Docket No. ER15-550-000, a notice of extension was issued on April 15, 

2015 granting NYISO an extension of time to comply with the requirements of Standards 

WEQ-012 applicable to transactions on NYISO’s MIS. NYISO’s compliance filing in 

Docket No. ER15-550-000 remains pending.

24 We note that ISO/RTO Council did not renew the objections that it raised in its 

comments on the NOPR by filing a request for rehearing. Thus, the only challenge to the 

PKI timetable that is before us in this order on rehearing is the request for rehearing filed 

by NYISO.
Docket No. RM05-5-024 - 11 -

The Commission orders:

(A) NYISO’s withdrawal of its request for rehearing is hereby accepted and its 

request for rehearing is hereby denied as moot, as discussed in the body of this order.

(B) Edison’s request for rehearing is hereby denied and its request for 

clarification is hereby granted, in part, and denied, in part, as discussed in the body of this 

order.

By the Commission.

( S E A L )

Nathaniel J. Davis, Sr.,

Deputy Secretary.