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### Reliability and Market Interface Principles

Reliability Principles NERC Organization Standards are based on certain Reliability Pr inciples that define the foundation of reliability for North American bulk electric systems. Each Organization Standard shall enable or support one or more of the Re liability Principles, thereby ensuring that each standard serves a purpose in suppor t of reliability of the North American bulk electric systems. Each Organization Standard shall also be consistent with all of the Reliability Principles, thereby ensuring that no standard undermines reliab ility through an unintended consequence.

Reliability Principle 1 — Interconnected bulk electric system s shall be planned and operated in a coordinated manner to perform reliably under no rmal and abnormal conditions as defined in

the NERC Standards.

Reliability Principle 2 — The frequency and voltage of in terconnected bulk electric systems

shall be controlled within defined limits thr ough the balancing of real and reactive power supply

and demand.

Reliability Principle 3 — Information necessary for the planning and operation of interconnected bulk electric systems shall be made available to those en tities responsible for planning and operating the systems reliably.

Reliability Principle 4 — Plans for emergency operation and system restoration of interconnected bulk electric systems shall be developed, coordinated, maintained and implemented.

Reliability Principle 5 — Facilities for communication, monitoring, and control shall be provided, used, and maintained for the reliabilit y of interconnected bulk electric systems.

Reliability Principle 6 — Personnel responsible for planning and operating interconnected bulk electric systems shall be trained, qualified, a nd have the responsibil ity and authority to implement actions.

Reliability Principle 7 — The security of the interconnected bulk electric systems shall be assessed, monitored, and maintained on a wide-area basis.

Market Interface Principles Recognizing that bulk electric system reliability a nd electricity markets are inseparable and mutually interdependent, all Organization Standards shall be consistent with the Market Interface Principles. Consideration of the Market Interface Principles is intended to assure Organization Standards are written such that they achieve their reliability objective without causing undue restrictions or adverse impacts on competitive electricity markets.Page 2 of 2 Market Interface Principle 1 — The planning and operation of bulk electric systems shall recognize that reliability is an essential requ irement of a robust North American economy.

Market Interface Principle 2 — An Organization Standard shall not give any market participant an unfair competitive advantage.

Market Interface Principle 3 — An Organization Standard sha ll neither mandate nor prohibit any specific market structure.

Market Interface Principle 4 — An Organization Standard shall not preclude market solutions to achieving compliance with that standard.

Market Interface Principle 5 — An Organization Standard sh all not require the public disclosure of commercially se nsitive information. All market participants shall have equal opportunity to access commercially non-sensitive in formation that is required for compliance with reliability standards.