## EE.RMSTD-98-440 ,» -'. 1


# REPORT OF THE U.S. DEPARTMENT OF ENERGY'S POWER OUTAGE STUDY TEAM

FINDINGS AND RECOMMENDATIONS TO ENHANCE RELIABILITY FROM THE SUMMER OF 1999

March 2000 Final Report '. , 

## EE-RM/STD-98-440

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# REPORT OF THE 

# u.s. DEPARTMENT OF ENERGY'S POWER OUTAGE STUDY TEAM££-i?M /

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## FINDINGS AND RECOMMENDATIONS TO ENHANCE RELIABILITY FROM THE SUMMER OF 1999

March 2000 Final Report

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## EE-RM/STD-98-440 

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# POST Study Participants

Mr. Paul Carrier, Chairman Office ofPolicy U.S. Department ofEnergy Prof. Fernando Alvarado* Prof. Anjan Bose Department ofElectrical and Computer Engineering College of Engineering and Architecture University ofWisconsin-Madison Washington State University Mr. Vikram Budhraja' Dr. William Buehring' Electric Power Group Decision and Information Sciences Division Argonne National Laboratory Mr. Anthony Como' Prof. Chris DeMarco Office ofFossil Energy Department ofElectrical and Computer Engineering U.S. Department ofEnergy University ofWisconsin-Madison Mr. Joseph Eto* Ms. Regina Griego' Environmental Energy Technologies Division Office ofEnvironment, Safety, and Health E.O. Lawrence Berkeley National Laboratory U.S. Department ofEnergy Dr. John Hauer' Prof. Ian Hiskens Energy Technology Division Department ofElectrical and Computer Engineering Pacific Northwest National Laboratory University ofIllinois at Urbana-Champaign Mr. John Kueck* Prof. Thomas Overbye Engineering Technology Division Department ofElectrical and Computer Engineering Oak Ridge National Laboratory University ofIllinois at Urbana-Champaign Mr. Philip Overholt' Dr. Paula Scalingi' Office ofEnergy Efficiency and Renewable Energy Office ofCritical Infrastructure Protection U.S. Department ofEnergy U.S. Department ofEnergy Prof. Richard Schuler Dr. Kevin Stamber Cornell Institute ofPublic Affairs Critical Infrastructure Surety Department Cornell University Sandia National Laboratories Prof.Robert Thomas* Mr. F. Craig Zingman* School ofElectrical Engineering Office ofEmergency Management Cornell University U.S. Department ofEnergy POST coordinated with the Consortium for Electric Reliability Technology Solutions DOE Management Support: Richard Glick and Howard Gruenspecht Technical Consultants: James Dyer, A. Daniel Gorski, and Goray Mookerjee Publication/Administrative Support: Margaret Clemmons and Kathleen Schmidt POST members.
.
iii ' 

# POST Study Participants·

Mr. Paul Carner, Chainnan" Office ofPolicy U.S. Department ofEnergy Prof. Fernando Alvarado" Prof. Anjan Bose Department ofElectrical and ComputerEngineering College ofEngineering and Architecture University ofWisconsin-Madison Washington State University Mr. Vikram Budhraja" Electric Power Group Dr. William Buehring" Decision- and Information Sciences Division Argonne National Laboratory Prof. Chris DeMarco Mr. Anthony Como" Office ofFossil Energy U.S. Department ofEnergy Department ofElectrical and ComputerEngineering
Mr. Joseph Eto" Environmental Energy Technologies Division

.E.O. Lawrence BerkeleyNational Laboratory Dr. John Hauer" Energy TechnologyDivision Pacific Northwest National Laboratory Mr. John Kueck' Engineering Technology Division Oak Ridge National Laborato!), Mr. Philip Overholt" Office ofEnergy Efficiency and Renewable Energy U.S. Department ofEnergy Prof. Richard Schuler Cornell Institute ofPublic Affairs Cornell University Prof. Robert Thomas" School ofElectrical Engineering Cornell University University ofWisconsin-Madison
... Ms. Regina Griego* Office ofEnvironment, Safety, and Health U.S. Department ofEnergy Prof. Ian Hiskens Department ofElectrical and ComputerEngineering University oflllinois at Urbana-Champaign Prof. Thomas Overbye Department ofElectrical and ComputerEngineering University oflllinois at Urbana-Champaign Dr. Paula Scalingi*
. Office ofCritical Infrastructure Protection 

## u.s. Department ofEnergy Dr. Kevin Stamber Critical Infrastructure Surety Department Sandia National Laboratories Mr. F. Craig Zingman* Office ofEmergency Management U.S. Department ofEnergy
. POST coordinated with the Consortium for Electric Reliability Technology Solutions
. DOE Management Support: Richard Glick and Howard Gruenspecht Technical Consultants: James Dyer, A. Daniel Gorski, and Goray Mookerjee Publication! Administrative Support: Margaret Clemmons**~nd** Kathleen Schmidt

•POST members.

iii

## EE-RM/STD-98-440 

# / .- ReportoftheDOEPower OutageStudy Team on ElectricReliabilityEvents of theSummer of1999

iv**~:** .**~.** : . Report of the DOEPower Outage Study Team on Electric ReliabilityEvents of the Summer of 1999

IV

## EE-RM/STD-98-440 / w - - 

# Contents

POST Study Participants......................................................................................................................... iii Notation.................................................................................................................................................... vii 

### Executive Summary . ........................................................................ ................................. SIntroduction
......................................................................................................................... 1 2 Summary ofElectric Power System Events Studiedby POST
.......................................................... 3 2.1 New England: Generation Deficiency on June 7 and 8
............................................................ 3 2.2 New York City: Outages onJuly 6 and 7.................................................................................... 4 2.3 Long Island: Outages and Depressed Voltages on July 3-8
....................................................... 4 2.4 M id-Atlantic Area: Voltage Declines on July 6 and 19............................................................... 5 2.5 New Jersey: Outages on July 5-8
........................................ ................................. 5. 2.6 Delmarva Peninsula: Outages on July 6...................................................................................... 6 2.7 South-Central States: Rotating Outages on July 23
.................................................................... 6 2.8 Chicago: Outages on July 30-August 12
............................................ 7 2.9 Follow-up Activities..................................................................................................................... 7 3 Summ ary ofPOST Findings
........................................ 8 3.1 New England................................................................................................................................ 8 3.2 New York City ............................................................................................................................. 8 3.3 Long Island................................................................................................................................... 9 3.4 Mid-Atlantic Area
................................................................................................................... 10 3.5 NewJersey
............. .......................................................................................................... 11 3.6 Delmarva Peninsula................................................: 11 3.7 South-Central States
..................................................................................................................... 12 3.8 Chicago....................................................................................................................................... 13 

### 4 Process for Soliciting Public Input..................................................................................................... 16 5 Recomm endations to the Secretary ofEnergy
................................................................................... 17 Appendix A Sum m ary ofPublic Comments................................................................................... . A

- Appendix B Glossary
.............................................................................................................................. BTables I Sum mer of 1999: Electric Power Events Studied by POST
............................................................... 3 2 Summary ofRecommendations and Associated Findings ................................................................... 29

' *'
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# E~.RM/STD-98-44~

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# 13::?
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# Contents

POST Study Participants.......................................................................................................................... 111 

### Notation.................................................................................................................................................... Vll 

### Executive Summary
................................................................................................................................. S-1 Introduction
......................................................................................................................,.................. 1 2 Summary ofElectric Power System Events Studied by POST
........................................................;... 3 2.l New England: Generation Deficiency on June 7 and 8
.............................................................. 3 2.2 New York City: Outages on July 6 and 7.................................................................................... 4 2.3 Long Island: Outages and Depressed Voltages on July 3-8
....................................................... 4 2.4 Mid-Atlantic Area: Voltage Declines on J,uly 6 and 19............................................................... 5 2.5 NewJersey: Outages on July 5-8
............................................................................................... 5 2.6 Delmarva Peninsula: Outages on July 6...................................................................................... -6 2.7 South-Central States: Rotating Outages on July 23 ....................................................................6 2.8 Chicago: Outages on July 3D-August 12
.....................................................;....;...................;..... 7 2.9 Follow-up Activities..................................................................................................................... 7 3 Summary ofPOST Findings
.........................................................................................................:..... 8 - . 3.1 New England
................................................................................................................................ 8 3.2 New York City
............................................................................................................................. 8 3.3 Long Island................................................................................................................................... 9 3.4 Mid-Atlantic Area
..................................................................................................................._.-.. 10 3.5 New Jersey
....................:................:............................................................................................. .11 3.6 Delmarva Peninsula
................................................:..................................................................... 11 3.7 South-Central States..................................................................................................................... 12 3.8 Chicago.......................................................................................................................................... 13 4 Process for Soliciting Public Input..
..............................................................................................**~.....** 

### -16

- 5 Recommendations to the Secretary ofEnergy
..........................................:......................................... 17 Appendix A Summary ofPublic Comments
...........................................................................................," A-I· Appendix B Glossary
.....................................................................................................:......:..................B·-1 

### Tables 1 Summer of 1999: Electric Power**E~ents** 

### Studied by POST
.................................. ...... ....................... 3 2 Summary ofRecommendations and Associated Findings
.................................................:................. ·29

v

## EE-RM/STD-98-440..:/3 ;: Reportof theDOEPowerOutageStudy Team on ElectricReliabilityEvents of the Summer of1999

vi

# E~-RM/STD-98-440_#/3~·., Reportof the DOEPower Outage Study Team on Electric ReliabilityEvents of the Spmmer of J

999

'.r'

vi

### EE-RM/STD-98-440- 

# /3


# Notation

This notation list identifies the abbreviations, acronyms, initialisms, and units of measure used in this report. The glossary (Appendix B) provides definitions ofsome of the terms listed here as well as many others used throughout the report and some others that are related to the field but not expressly mentioned. In the text ofthis report, terms that are defined in the glossary appear in italics the first time they are used. ComEd Commonwealth Edison Company Con Ed Consolidated Edison Company DC direct current DOE U.S. Department ofEnergy DPL Delmarva Power & Light Company EPRI Electric Power Research Institute FACTS flexible alternating-current transmission system FERC Federal Energy Regulatory Commission GPU GPU Energy IR2 Indian River Unit 2 ISO independent system operator ISO-NE ISO-New England kV kilovolt(s) kVA kilovolt(s)-ampere kW kilowatt(s) LIPA Long Island Power Authority MAAC Mid-Atlantic Area Council (NERC region) MAPP Mid-Continent Area Power Pool (NERC region) MVA megavolt(s)-ampere MVAR megavolt(s)-ampere-reactive MW megawatt(s) MWh megawatt-hour(s) ofelectric energy

vii -j
. -------------- 

# --------

EE-RM/STD-98-440-

# qf:

# 13~
Notation

This notation list identifies the abbreviations, acronyms, initialisms, and units of measure used in this report. The glossary (Appendix B) provides defmitions ofsome of the tenns listed here as well as many others used throughout the report and some others that are related to the field but not expressly mentioned. In the text ofthis report, tenns that are defined in the glossary appear in italics the first time they are used. CornEd Commonwealth Edison Company ConEd Consolidated Edison Company DC direct current DOE U.S. Department ofEnergy DPL Delmarva Power & Light Company EPRI Electric Power Research Institute FACTS flexible alternating-current transmission system FERC Federal Energy Regulatory Commission GPU GPUEnergy IR2 Indian River Unit 2 ISO independent system operator ISO-NE ISO-New England kV kilovolt(s) kVA kilovolt(s)-ampere kW kilowatt(s) LIPA Long Island Power Authority MAAC Mid-Atlantic Area Council (NERC region) MAPP Mid-Continent Area PowerPool (NERC region) MVA megavolt(s)-ampere MVAR megavolt(s)-ampere-reactive MW megawatt(s) MWh megawatt-hour(s) ofelectric energy

-vii ..

### ,

.'_ 0

## EE-RM/STD-98-440 9/3^ ReportoftheDOEPowerOutageStudy Team on ElectricReliabilityEvents ofthe Summerof1999


### NARUC National Association ofRegulatory Utility Commissioners '... :'

- NERC North American Electric Reliability Council : NYPP New York Power Pool
. PECO PECO Energy Company PJM PJM Interconnection, LLC (formerly Pennsylvania, New Jersey, Maryland Interconnection) POST Power Outage Study Team PSE&G Public Service Electric and Gas Company PUC public utilities commission R&D research and development SCADA supervisory control and data acquisition SERC Southeastern Electric Reliability Council (NERC region) SPP Southwest Power Pool (NERC region) TVA Tennessee Valley Authority T&D transmission and distribution V volt(s) XLPE cross-linked polyethylene

viii 

### EE-RM/STD-98-440,,-=If

# 13~· '.. Report of the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of 1999

.'. :

Vlll

## EE-RM/STD-98-440 - 

## /-S ?


# Executive Summary
Recently; the National Academy ofEngineering ranked the twenty greatest engineering achievements ofthe last century, and, on the basis ofits effect on the quality oflife, electrification, or electric power, rated first. Having a reliable electric power system has become an essential part ofour daily lives, allowing us to enjoy a high quality oflife and a vital economy that continues to prosper. Yet, our electric power system is not infallible. At times, extreme weather conditions, equipment failures, and human errors have interrupted the supply of electricity. And, as the digital age continues to affect our lives more and more, many find an even greater need for high-quality and reliable electric services. In fact, in the summer of 1999, during periods ofextreme heat and humidity, power outages and other system disturbances disrupted the lives ofmillions ofpeople and thousands ofbusinesses in various regions ofthe country. In response to public concerns about these problems, the Secretary ofEnergy brought together a team ofexperts to study some oflast summer's events. This team
- the Power Outage Study Team, or POST - consists ofexperts from the Department of Energy, the national laboratories, and the academic community. The team examined a number ofthose events in detail and, in this report, recommends a number ofactions that the federal government can take to help avoid future outages. What distinguishes this report from documents ofthe past is that these recommendations take into consideration a new factor - an industry that is undergoing extensive restructuring. Until recently, the U.S. electric power system consisted primarily offull-service utilities that generated, transmitted, and distributed electricity to customers at rates set by

- regulators. Buttimes have changed, and now 24 states and the District ofColumbia have passed legislation or issued regulatory orders that permit customers to choose the company that supplies their electricity. Almost every other state is considering the possibility ofproceeding in this direction. At the federal level, the Federal Energy: Regulatory Commission has also increased the role ofcompetition in generation markets through its implementation ofthe 1978 Public Utility Regulatory Policies Act and the 1992 Energy Policy Act. Thus, the electric utility industry is following the lead ofthe telecommunications, airline, and natural gas industries by increasing its reliance on competition. The new electric industry will rely on competitive markets as a basis for making decisions concerning electricity investments, operations, and consumption. Transmission and distribution services are likely to remain regulated. Competitive markets are expected to herald new efficiencies and dramatic innovations that will save customers money and lead to new electric services. Under
S-1 ( 

### EE·RM/STD·98-440

# -#

# /3 

# 4.
Executive Summary
Recently; the National Academy ofEngineering ranked the twenty greatest engineering achievements ofthe last century, and, on the basis ofits effect on the quality oflife, electrification, or electric power, rated first. Having a reliable electric power system has become an essential part ofour daily lives, allowing us to enjoy a high quality oflife and a vital economy that continues to prosper. Yet, ourelectric power system is not infallible. At times, extreme weather conditions, equipment failures, and human errors have interrupted the supply of
. electricity. And, as the digital age continues to affect our lives more and more, many fmd an even greater need for high-quality and reliable electric services. In fact, in the summer of 1999, during periods ofextreme heat and humidity, power outages and other system disturbances disrupted the lives ofmillions ofpeople and thousands ofbusinesses in various regions ofthe country. In response to public concerns about these problems, the Secretary ofEnergy brought together a team ofexperts to study some oflast summer's events. This teamthe Power Outage StudyTeam, or POST

- consists ofexperts from the Department of Energy, the national laboratories, and the academic community. The team examined a number ofthose events in detail and, in this report, recommends a number ofactions that the federal government can take to help avoid future outages.**~at** distinguishes this" report from documents ofthe past is that these recommendations take into consideration a new factor

- an industry that is undergoing extensive restructuring. Until recently, the**U.~.** electric power system consisted primarily offull-service utilities that generated, transmitted, and distributed electricity to customers at rates setby regulators. But**t~es** have changed, and now 24 states and the District ofColumbia have passed legislation orissued regulatory orders that permit customers to choose the company that supplies their electricity. Almost every other state is considering the possibility ofproceeding in this direction. At the federal level, the Federal Energy,
.

. Regulatory Commission has also increased the role ofcompetition in generationmarkets

through its implementation ofthe 1978 Public Utility Regulatory Policies Act and the 1992 Energy Policy Act. Thus, the electric utility industry is following the lead ofthe telecommunications, airline, and natural gas industries by increasing its reliance on competition. The new electric industry will rely on competitive markets

## as a basis for making decisions concerning electricity investments, operations, and consumption. Transmission and distribution services are likely to remain regulated. Competitive markets are expected to herald new efficiencies and'dramatic
. innovations that will save customers money and lead to new electric services. Under

...... - S-1

### EE-RM/STD-98-440- -T/3= Reportof theDOEPowerOutageStudy Team on ElectricReliabilityEvents of the Summerof1999 '':
. .


### proper guidance, these markets will also improve reliability. However, the mechanisms : '.

- that protected electric reliability in the past need to be changed alongwith ongoing


### - - - . market developments. The power outages and disturbances studied by POST served as a wake-up call, reminding us that reliable electric service is critical for our health, comfort, and the economy. While the newindustry structure should improve reliability, as an earlier Department ofEnergy Task Force on Electric System Reliability recognized, the transition to that new structure presents a risk toreliability. It is essential for continued reliable electric service that we proceed expeditiously through thisperiod oftransition. POST conducted a thorough study ofeight outages and disturbances in different parts ofthe country. The team visited the sites and interviewed the people who were operating the system at the time ofthe occurrences, obtaining valuable first-hand information and data. Following a detailed analysis ofthese facts, POST published an - interim report, which described the outages and disturbances and discussed the team's findings. The team then conducted a series ofthree technical workshops, which gave the public an opportunity to comment on appropriate federal actions. Finally, the team examined all ofthis information and developed its recommendations.. In its interim report, POST found that the reliability events ofthe summer of 1999 demonstrated that the necessary operating practices, regulatory policies, and technological tools for assuring an acceptable level ofreliability were not yet inplace.- -' This report outlines some ofthe changes needed to address the causes ofthese events. Many ofthe recommendations

____ presented in this report address reforms Ancillaryservicesinclude a number of required to enable restructured markets functions, such as reserves andreactive to fulfill theirpotential toprovide power, that are necessary to support improved reliability. Markets should operations ofthe transmission system. reflect the value ofreliability to energy providers and their customers, and to the broader public interest. Both providers andcustomers should have opportunities to participate in markets for energy and ancillary services

- and toprofit

- from that participation. Modified (or new) institutions are needed to monitor and enforce compliance withreliability standards.
... Other recommendations address the importance ofcontinuing to invest in the development and use ofthe toolsneeded for monitoring and maintaining the electric system and for responding to system emergencies. The key to maintaining reliability is " information. Improved diagnostic tools, improved data gathering, andreal-time modeling ofsystem conditions are needed. These tools can be used to improve maintenance

- practices and assist operators in identifying and responding to system emergencies.
. Providers and customers can use real-time power system and market information to manage reliability.


### S-2
.. . " 

### , 

### EE-RM/STD-98-440-#/3:=9 Report of theDOEPower Outage Study Team on Electric Reliability Events of the Summer of 1999

8-2 proper guidance, these markets will also improve reliability. However, the mechanisms that protected electric reliability in the past need to be changed along with ongoing market developments. The poweroutages and disturbances studiedby POST served as a wake-up call, remindingus that reliable electric service is critical for ourhealth, comfort, and the economy. While the new industry structure should improve reliability, as an earlier Department ofEnergy TaskForce on Electric System Reliabilityrecognized, the transition to that new structure presents a risk to reliability. It is essential for continued reliable electric service that we proceed expeditiously through this period oftransition. POST conducted a thorough study ofeight outages and disturbances in different parts ofthe country. The team visited the sites and interviewed the people who were operating the system at the time ofthe occurrences, obtaining valuable first-hand information and data. Following a detailed analysis ofthese facts, POST published an " interimreport, which described the outages and disturbances and discussed the team's fmdings. The team then conducted a series ofthree technical workshops, which gave the public an opportunityto comment on appropriate federal actions. Finally, the team examined all ofthis information and developed its reco"mmendations. In its interim report, POST found that the reliability events ofthe summer of 1999 demonstrated that the necessary operating practices, regulatorypolicies, and technological tools for assuring an acceptable level ofreliability were not yet in place." This report outlines some ofthe changes needed to address the causes ofthese events. Many ofthe recommendations presented in this report address reforms required to enable restructured markets to fulfill theirpotential to provide improved reliability. Marl\ets should reflect the value ofreliability to energy providers and their customers, and to the broader public interest. Both Ancillaryservices include a number"of functions, such as reserves andreactive power, that are necessary to support operations ofthe transmission system.
providers andcustomers should have " " opportunities to participate in markets for energy and ancillary services

- and to profit from thaiparticipation. Modified (ornew) institutions are needed to monitor and enforce" compliance with reliability standards. Otherrecommendations address the importance ofcontinuing to invest in the development and use ofthe tools needed for monitoring and maintaining the electJic system and for responding to system emergencies. The key to maintaining reliability is information. Improved diagnostic tools, improved data gathering, and

### ~eal-time modeling ofsystem conditions are needed. These tools can be used to improve maintenance practices and assist operators in identifying and responding to system emergencies. Providers and customers can use real-time power system and market information to manage reliability. .. '- , -'.'**~** "';;;

-:-

-'.:..:

. ....

## EE-RM/STD-98-440o-:/. - . ReportoftheDOEPowerOutageStudy Team on Electric ReliabilityEvents of theSummer of1999

-


### POST has limited its recommendations to federal actions that address the team's
. findings. Other aspects ofreliability and the restructuring process may warrant federal -: actions but are beyond the scope ofthis study. Further, POST's recommendations reflect the basic premise that, while markets and industry should address issues related to reliability, the federal government has a fundamental responsibility for ensuring that the public's interests are fully represented. Moreover, many stakeholders, including state and local governments, share this responsibility. Systems developed by the industry have evolved to protect electric reliability; however, many ofthese systems need to be overhauled to address the needs of a changing industry. Nevertheless, they are the appropriate starting points for any required changes. In this report, POST submits twelve recommendations forconsideration by the Secretary ofEnergy. The following recommendations are designed to help avoid future power outages. One or more possible federal actions are suggested alongwith each recommendation. 1. Promote market-based approaches to ensure reliable electric services. Restructuring is based on the fundamental principle that competition and markets, not regulators and utilities, result in better investment and operating decisions with respect to generation and consumption ofelectricity. Mechanisms that will ensure adequate supplies ofelectricity- and reliable operations

- should be designed with this principle in mind. The value ofreliability needs to be determined in competitive
. markets, and customers, as well as energy providers, need to have the opportunity to participate in markets forenergy and ancillary services - and profit from that participation. Yet, because electric service is provided through a network, it has aspects ofa public good and may beunderprovided by private entities. Guidance is needed to' ensure that the public interest is adequately captured. Many states have made significant progress in developing competitive electricity markets. However, efforts in developing market-based mechanisms forpromoting

- electric reliability

- for example, allowing customers toparticipate in energy and ancillary service markets - have been less aggressive. Developers ofthese mechanisms must explicitly account for the broad geographic scope oftoday's electricity markets, which can extend across multiple states and regions ofthe country.' Although states have . a definite role in regulating utilities and protecting consumers, there is also an important federal role: to improve the operation ofpower markets by providing leadership, direction, and consistency across the country.

The U.S. electric power system consists ofjust three distinct interconnections; trade can be conducted throughout an interconnection. For example, a generator in Minnesota can sell to a 

### customer inFlorida.

'
. S-3 - 

### S-3 -: -, .,: Report of theDOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of1999

--
POST has limited its recommendations to federal actions thataddress the team's fmdings. Other aspects ofreliability and the restructuringprocess may warrantfederal, actions but are beyond the scope ofthis study. FUrther, POST'srecommendations reflect the basic premise that, while markets and industry should address issues related to reliability, the federal government has a fundamental responsibility for ensuring that the public's interests are fully represented. Moreover, many stakeholders, including state and local governments, share this responsibility. Systems developed by the industry have evolved to protect electric reliability; however, many ofthese systems need to be overhauled to address the needs of a changing industry. Nevertheless, they are the appropriate starting points for any required changes. In this report, POST submits twelve recommendations for consideration bythe Secretary ofEnergy. The following recommendations are designed to help avoid future poweroutages. One or more possible federal actions are suggested along with each recommendation. 

### 1. Promote market-based approacbes to ensure reliable electric services. Restructuring is based on the fundamental principle that competition and markets, not regulators and utilities, result in better investment and operating decisions with respect to generation and consumption ofelectricity. Mechanisms that will ensure adequate supplies ofelectricity

- and reliable operations

- shouldbe designed with this principle in mind. The value ofreliabilityneeds to be determined in competitive markets, and customers, as well as energyproviders, need to have the opportunity to participate in markets for energy and ancillary services

- and profit from that participation. Yet, because electric service is provided through a network, it has aspects ofa public good and maybeunderprovided byprivate entities. Guidance is needed to·
_
, ensure that the public interest is adequately captured. Many states have made significant progress in developing competitive electricity markets. However, efforts in developing market-based mechanisms forpromoting

- electric reliability

- for example, allowing customers to participate 

### in energy and ' ancillary service markets

- have been less aggressive. Developers ofthese mechanisms must explicitly accOlmt for the broad geographic scope oftoday's electricity markets, which can extend across multiple states and regions ofthe country.} Although states have a definite role in regulating utilities and protecting consumers, there is also an important federal role: to improve the operation ofpowermarkets byproviding**l~adership,** - direction, and consistency across the country.

} The U.S. electric power system consists of justthree distinct interconnections'; trade canbe' conducted throughout

### an interconnection. For example, a generator in Minnesota caoseIl,toa customer in Florida.



### S-3 - .

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. -.**~-** - ,

## EE-RM/STD-98-440-#4 

## /
Reportof theDOE PowerOutageStudy Team on ElectricReliabilityEvents of the Summer of1999

Actionforfederal consideration: Supportthe implementationoffair,efficient,andtransparent markets for electric powerandancillaryservices. 2. Enable customer participation in competitive electricity markets. The ability ofcustomers to manage their demand in response to market prices is the key to ensuring both reliable electric service and an efficiently functioning, competitive electricity market. POST agrees with public comments received that meaningful customer participation is a prerequisite for achieving the full reliability benefits of restructuring. To more fully participate in a competitive market, customers must be able to see real-time prices (ifthey choose to do so) and have access to the communication and control technologies that will enable them to participate directly. Actionsforfederalconsideration: * Supportthe developmentof market rulesthatallowcustomers to supply load reductionsandancillaryservicesin competitiveenergymarkets. * Encouragedevelopment ofdemand managementsystems thatsupportelectric reliability. 3. Remove barriersto distributedenergy resources. There is currently great interest in relying more heavily on distributed generation technologies to help utilities respond more rapidly to an increased demand for electricity in areas where demand is already high. At the same time, utilities are striving to improve the quality ofpower to customers. Many argue that barriers impede market-driven acceptance ofthese technologies. The federal government should target this area for special attention and review and remove these barriers, as needed. Actionsforfederal consideration: * Supportthe development ofinterconnectionstandards fordistributed energy resources. * Supportstate-ledefforts to.addressregulatory disincentives for integrating customersupply anddemand solutions. * Study the potentialforusingemergency backupgeneratorsto reducesystem demandsto helpavoid poweroutages.

S-4 * * . * * ' .. '*. - S4 -:~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ , , 

## EE-RM/STO-9S-440'#

# /~~ Repon of the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of 1999

S-4 Action for federal cOllsideration:

• Support the implementation of fair, efficient, andtransparentmarkets for electricpowerandancillaryservices. 

### 2. Enable customer participation in competitive electricity markets. The ability ofcustomers to manage their demand in response to market prices is the key to ensuring both reliable electric service and an efficiently functioning, competitive electricity market. POST agrees with public comments received that meaningful customerparticipation is a prerequisite for achieving the full reliability benefits of restructuring. To more fully participate in a competitive market, customers must be able to see real-time prices (ifthey choose to do so) and have access to the communication and control technologies that will enable them to participate directly. ' Actions for federal consideration:

• Support the development oj market rules that allow customers to supply load reductions andancillary services in competitive energy markets.

• Encourage development oj demandmanagementsystems that support electric reliability. 

### 3. Remove barriersto distributed energy resources. There is currently great interest inrelying more heavily on distributed generation ' technologies to help utilities respond more rapidly to an increased demand for electricity in areas where demand is already high. At the same time, utilities are striving to improve the quality ofpowerto customers. Many argue that barriers impede market-driven acceptance ofthese technologies. The federal government should target this area for special attention and review and remove these barriers, as needed. Actions for federal consideration:

• Support the development ojinterconnection standardsJordistributed energy resources.
• Support state-ledefforts to.address regulatorydisincentivesJor integraiing
. customersupply anddemandsolutions.

• Study thepotentialJor using emergency backupgenerators to reduce system demands to help avoidpoweroutages. ',. :.

';,-..

### EE-RM/STD-98-440 -7 5 - _________ T ReportoftheDOEPowerOutageStudy Team onElectricReliabilityEvents of the Summer of1999

,- : ""*

* - "
. ' -"'' * 

### 4. Support mandatory reliability standardsfor bulk-power systems. :

--- : ' 

### ~-: -Today, the interconnected electric power system is beingtransformed from one that was primarily designed to serve the customers offull-service utilities, each integrated across the generation, transmission, and distribution functions, to one that will support a vibrant, competitive market. This change makes the current system ofvoluntary compliance with reliability standards inadequate for ensuring reliability. Mandatory standards for bulk-power systems are needed to ensure that the "rules ofthe road" are implemented in a straightforward and balanced manner. Actionforfederal consideration: Supportthe creationof aself-regulatedreliability organizationwith federal oversightto developandenforcereliabilitystandards forbulk-powersystems as partof a comprehensiveplan forrestructuring the electric industry. 5. Support reporting and sharing ofinformation on "bestpractices." Many forums for exchanging information on "best practices" for maintaining and operating electric generation, transmission, and distribution systems already exist. However, concerns exist about the consistency ofsome information (such as reliability indices), the availability ofdata to all industry stakeholders, and the continued viability ofthese forums in a restructured industry. The federal government could play an important role in enhancing the definition, collection, and sharing ofinformation. It should work in close partnership with states and other industry stakeholders as it develops this role. Actions for federalconsideration: * Promotethe use ofuniformdefinitionsandmeasurements for reliability-related information. * Facilitatethe collectionandsharingof informationon reliability-related regulatoryissuesamongstate publicutility commissions. * Supportactivitiesto developand shareinformationamongindustry participants on criticalresourcesandindustry practices.
. 6. Enhance emergency preparedness activities for low-probability, high-consequence events on bulk-power systems. Emergencies on bulk-power systems affect large geographic areas, involve many stakeholders, and affect millions ofcustomers. The events ofthe summer of 1999 :-: demonstrated that effective communication and coordination among many parties are critical during times ofsystem emergencies. The federal government should actively support efforts to continually review and improve planning and response capabilities.

S-5 4:-
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Report of the DOEPower Outage Study Team on Electric ReliabilityEvents ;fthe

### Summ~r of 1999



### 4. Support mandatory reliability standards for bulk-power systems. Today, the interconnected electric power system is being transformed from one that was primarily designed to serve the customers offull-service utilities, each integrated across the generation, transmission, and distribution functions, to one that will support a vibrant, competitive market. This change makes the current system ofvoluntary compliance with reliability standards inadequate for ensuring reliability. Mandatory standards for bulk-power systems are needed to ensure that the "rules ofthe road" are implemented in a straightforward and balanced manner. Action for federal consideration:



### 5. • Support the creation of a self-regulated reliability organization with federal oversight to develop andenforce reliability standards for bulk-powersystems as partof a comprehensiveplan for restructuring the electric industry. 

### Support reporting and sharing ofinformation on "bestpractices." Many forums for exchanging information on "bestpractices" for maintaining and operating electric generation, transmission, and distribution systems already exist. " However, concerns exist about the consistency ofsome information (such as reliability " indices), the availability ofdata to all industry stakeholders, and the continued viability ofthese forums in a restructured industry. The federal government couldplay an important role in enhancing the definition, collection, and sharing ofinformation. It should work in close partnership with states and other industry stakeholders as it develops this role. Actions for federal consideration:



### 6. • Promote the use of uniform definitions andmeasurements for reliability-related information. "" Facilitate the collection andsharingof information on reliability-related regulatory issues amongstatepublic utility commissions.

• Support activities to develop andshare information among industryparticipants" on critical resources andindustrypractices. " 

### Enhance emergency preparedness activities for low-probability, high-consequence events on bulk-power systems. Emergencies on bulk-power systems affect large geographic areas,**involve~y** stakeholders, and affect millions ofcustomers. The events ofthe summer of1999 "" demonstrated that effective communication and coordination among many parties are critical during times ofsystem emergencies. The federal government should actively support efforts to continuallyreview and improve planning and response capabilities.

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-

Actionforfederal consideration: Work with regional,state,andlocalauthoritiesto supportcontinuous : improvement in coordination, planning,and preparations to respondto electricityemergencies. 7. Demonstrate federal leadership through promotion of best reliability practices atfederal utilities. Federal utilities are unique assets that have long pursued many federal and regional objectives, ranging from power production to agricultural and economic development. As part oftheir role, these utilities have served as research and development catalysts for technological changes within the industry. Piloting new reliability initiatives would be consistent with this historic leadership role. Actionsforfederal consideration: * Developandpilotreliabilityself-assessment procedures. * Supportdistributedenergyresources. * Encourageeconomic energy efficiency. 8. Conduct public-interest reliability-related research and development consistent with the needs of a restructuringelectric industry. Industry investments in reliability-related R&D have declined steadily over the past few years. These declines have occurred at least in part because the "clients" for next-
- - generation investments, such as regional transmission organizations, are still in their formative stage. Furthermore, the independent system operators currently do not own the transmission assets and are nonprofit institutions. A stable climate for private

- investments in longer-range R&D conducted with the public's interest in mind does not currently exist. Federal investments in public-interest, reliability-related R&D are especially needed during this time ofindustry transition. POST strongly supports Secretary Richardson's commitment to increase federal investments in electric reliability R&D as provided forin the Administration's proposed fiscal year 2001 budget. .- Actionsforfederal consideration: . . * Develop real-timesystem monitoring,communication,andcontroltechnologies. * Createsensors,remote monitoring,anddiagnostictechnologiesforcablesand

. agingtransmission anddistributioninfrastructure. * Integratecustomerdemandmanagement,distributed generation,andstorage - technologies.

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## EE-RM/STO-9S-44o-#=13cR
Report of the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of 1999

S-6 Action forfederal consideration:

• Work with regional, state, andlocal authorities to supportcontinuous .improvement in coordination,planning, andpreparations to respond to electricity emergencies. 

### 7., Demonstrate federal leadership through promotion ofbest retiability practices atfederal utilities. Federal utilities are unique assets that have longpursued many federal and regional objectives, ranging from powerproduction to agricultural and economic development. As part oftheir role, these utilities have served as research and development catalysts for technological changes within the industry. Piloting new reliability initiatives w,?uld be consistent with this historic leadership role. Actions for federal consideration:

• Develop andpilot reliability self-assessmentprocedures.

• Support distributed energy resources.
• Encourage economic energy efficiency. 

### 8. Conduct public-interest reliability-related research and development
. consistent with the needs ofa restructuring electric industry. Industry investments in reliability-related R&D have declined steadily overthe past few years. These declines have occurred at least in part because the "clients" fornext- ' '. generation investments, such as regional transmission organizations, are still in therr formative stage. Furthermore, the independent system operators currently do not own the transmission assets and are nonprofit institutions. A stable climate for private investments in'longer-range R&D conducted with the public's interest inmind does not' currently exist. Federal investments in public-interest, reliability-related R&D are especially.needed during this time ofindustry transition. POST strongly supports', Secretary Richardson's commitment to increase federal investments 

### in electric

### ielia~ility R&D as provided for in the Administration'sproposed fiscal year 2001 budget.- ' Actions for federal consideration:

• Develop real-time system monitoring, communication, andcontrol technologies.

. . . . • Create sensors, remote monitoring, anddiagnostic technologies for cables'and, aging transmission anddistribution infrastructure.

• Integrate customerdemand management, distributedgeneration, andstorage technologies. ' "," "':".**~**

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.371 -"' '" ~* Improveanalyticmodels forloadforecasts,powersystem simulations,and 

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### ~. ~contingency assessments. . . 

### * Examinethedesignandperformanceof competitiveelectricitymarkets. 9. Facilitate and empower regional solutions to the siting of generation and transmission facilities. Stable incentives for investing in generation and transmission must be complemented by siting boards that can discharge their responsibilities in a timely and coordinated fashion. Such boards need to address two primary problems. First, policies among agencies, among states, between state and federal agencies, and among federal agencies overlap and sometimes conflict. Second, parochial bodies do not have incentives to seek regional solutions. These problems result in long delays, and they could lead to inefficient and inequitable siting decisions. 

### Actionsforfederal consideration: . * Convene regional summits to initiateandfacilitate dialogamongregional stakeholders. 

### * Supportfederallegislationto facilitatestateefforts to form regional siting boards. ". . * Raisereliabilityasan issue (asappropriate) wheneverfederal permitsare requiredfor sitingelectric facilities. . 10. Promote public awareness of electric reliability issues. General public awareness ofthe complex issues associated with maintaining reliable electric service is low. Yet, as demonstrated by the events ofthe summer of 1999, public
. interest in reliable electric service is high. Greater understanding ofelectric reliability issues, including both the frequency and causes of outages and the steps being taken to prevent and limit the consequences ofoutages, will lead to better-informed decisions.
. Special attention should be placed on discussing the costs and trade-offs inherent in making reliability investment and operating decisions. Future activities should : complement, not replace, existing state, utility, and locally led efforts and be effectively coordinated with them. ' Actionsforfederal consideration: -- . "- ':.~ -·* ContinueDOE-sponsored independentinvestigationsofsignificant power : outagesandotherreliability events. * ContinueDOE-sponsoredforumswhere stakeholderscan meet to discuss reliabilityissues.
. ' :

- i' :'.S-7 ':". I Reporto/theDOEPower Outage Study Team on ElectricReliabilityEvents o/theSummer

### 0/1999.":'"**'~'."** :**~/** :.

9. • Improve**ana~ytic** models for load forecasts. powersystem**simulation~,** and contingencyassessments.
• Examine the design andperformance of competitive electricity markets. I ' 

### Facilitate and empower regional solutions to the siting ofgeneration and transmission facilities. Stable incentives for investing in generation and transmission must be complemented by siting boards that can discharge theirresponsibilities in a timely and, coordinated fashion. Such boards need to address two primary problems. First, policies among agencies, among states,between state and federal agencies, and among federal agencies overlap and sometimes conflict. Second, parochial bodies do not have, incentives to seekregional solutions. These problems result in long delays, and they could lead to inefficient and inequitable siting decisions. Actions for federal consideration:

• Convene regionalsummits to initiate andfacilitate dialog among regional stakeholders.

• Support federal legislation tofacilitate state efforts to form regionalsiting boards. Raise reliabilityas an issue (as appropriate) whenever federalpermitsare' required for siting electric facilities. 

### 10. Promote public awareness ofelectric reliability issues. General public awareness ofthe complex issues associated with maintaining reliable electric service is low. Yet, as demonstrated bythe events ofthe summer of 1999, public interest in reliable electric service is high. Greaterunderstanding ofelectric reliability , issues, including both the frequency and causes ofoutages and the steps being taken to prevent and limit the consequences ofoutages, 

### will lead to better-infonned decisions. ' Special attention should be placed on discussing the costs and trade-offs inherent 

## iti
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. complement, notreplace, existing state, utility, and locally led efforts and be effectively, coordinated with them. Actions for federal consideration: Continue DOE-sponsored independent investigations of significantpower, outages andother reliability events.

• Continue DOE-sponsored forums where stakeholders can meet to discuss reliability issues. .'**S~7** "**~.** '.. ,'o.**~** "

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11. Monitor and assess vulnerabilities to electric power system reliability. ' The outages and disturbances studied by POST resulted from unpredicted events . that exploited specific weaknesses in physical systems and the planning and operating processes that supported them (e.g., extremely hot weather caused overloads and cable failures). Other electric power system vulnerabilities were identified during POST's studies and technical workshops. In view ofthe regional and national implications of power outages, known and emerging electric system vulnerabilities need tobe studied from a national rather than a local perspective. Studies from a national perspective uniquely belong to the federal government, but studies must be carried out in close partnership with the electric industry. Actionsforfederal consideration: * Work with industrystakeholdersto conduct comprehensiveassessmentsof electric powersystem vulnerabilities. * Work with industrystakeholdersto refineandimplementproceduresto assess the robustnessof the electricsystem in respondingtobulk-powersystem emergencies. 12. Encourage energy efficiency as a means for enhancing reliability. The increased adoption ofenergy efficiency measures can enhance electric system reliability by reducing demand growth in areas experiencing shortages in electric generation or constraints in electric transmission or distribution. Programs to stimulate adoption ofenergy-efficient technologies and practices can provide more rapid reliefto areas with fast-growing demand. Further, they can do so with fewer negative impacts than would occur during the construction ofnew generation, transmission, and: distribution facilities. Such programs might be especially helpful in areas where growth in electric demand is high; yet, markets for hew generation are in their infancy or existing incentives for investments in transmission and distribution are in transition. Technologies and practices that reduce loads during times ofpeak demand, such as high-efficiency air conditioning and lighting equipment, are especially valuable. Actionsfor federal consideration: * Work with slateandlocalgovernmentstosupportdevelopmentand implementation of cost-effective energy efficiencyprograms. Expandexisting federal programstopromoteenergy efficiency.
.

S-8 

## EE-RM/STD-98-440 - 

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# 3**~** Report oJtheDOEPower Outage Study Team on ElectricReliabilityEvents oJthe Summer oj1999



### 11. Monitor and assess vulnerabilities to electric power system reliability.·

-- The outages and disturbances studied byPOST resulted from unpredicted events
- that exploited specific weaknesses in physical systems and the planning and operating processes that supported them (e.g., extremelyhot weather caused overloads and cable failures). Otherelectric power system vulnerabilities were identified during POST's studies and technical workshops. 

### In view ofthe regional and national implications of poweroutages, known and emerging electric system vulnerabilities need to be studied from a national rather than a local perspective. Studies from a national perspective uniquely belong to the federal government, but studies must be carried out in close partnership with the electric industry. Actions for federal consideration:

• Work with industrystakeholders to conduct comprehensive assessments of electricpowersystem vulnerabilities. Work with industrystakeholders to refine andimplementprocedures to assess the robustness of the electric system in responding to bulk-powersystem emergencies. 

### 12. Encourage energy efficiency as a means for enhancing reliability. ...... ' '"
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The increased adoption ofenergy efficiency measures canenhance electric system reliability byreducing demand growth in areas experiencing shortages in electric

-- generation orconstraints in electric transmission or distribution. Programs to stimulate adoption ofenergy-efficient technologies and practices can provide more rapid reliefto areas with fast-growing demand. Further, they can do so with fewer negative impacts than would occur during the construction ofnew generation, transmission, and . _ distribution facilities. Such programs might be especially helpful in areas where growth in electric demand is high;' yet, markets for hew generation are in their infancy or - "

S-8 existing incentives for investments in transmission and distribution are in transition. Technologies and practices that reduce loads during times ofpeak demand, such as high-efficiency air conditioning and lighting equipment, are especially valuable. Actions for federal consideration:

• Work with state andlocalgovernments to support development and
_ implementation of cost-effective energy efficiencyprograms.
• Expandexistingfederalprograms topromote energy efficiency. 

## .....:

### EE-RM/STD-98-440.- /31 

# Section 1 Introduction

The summer of 1999 was marked by a number ofelectric power outages and other power disturbancesin the eastern interconnectionthat occurred during periods of extreme heat and humidity. 2 These included distributionsystem failures, as well as shortages ofpower supplies and occurrences oflow voltagesin the transmission system. Outages in New York City and Chicago were among the most notable. In response to public concerns, atthe summer meeting ofthe National Association ofRegulatory Utility Commissioners (NARUC), the Secretary ofEnergy pledged to investigate several recent major electric power disturbances as part of a six-point plan to ' improve the reliabilityofthe U.S. electric powersystem. The Secretary appointed a panel ofU.S. Department ofEnergy (DQE), national laboratory, and academic experts, called the Power Outage Study Team, or POST, to conduct the investigations. This is the final report ofPOST's investigation oflast summer's electric reliability problems. Six power outages and two power system disturbances that did not result in outages that took place between early June and early August 1999 were studied, and potential federal actions for preventing such events in the future are recommended. POST members visited the affected utilitiesor operating entities in the fall of1999
. to learn first-hand about the outages and system disturbances. Members interviewed the affected utilities and system operators,as well as other local parties, and reviewed available reports and materials that had been prepared following the events. Without exception, all parties cooperated and supported the team's efforts. The events and the POST's findings were described in an Interim Report, dated January 4, 2000. 3 Section 2 ofthis report provides brief summaries ofthe events drawn from the Interim-Report. : Section 3 reports POST's 38 findings from the events. The Interim Report formed the basis for a series ofthree DOE-sponsored technical workshops at which POST received public comments on recommendations to consider : for this final report. Technical workshops were held on January 20 in San Francisco, California; January 25 in New Orleans, Louisiana; and January 27 in Newark, New Jersey. More than 150 individuals attended and, ofthose, more than 50 offered public comments at one or more ofthe workshops. In addition, DOE received more than 70 written comments on the Interim Report. Section 4 summarizes the process that the team used to solicit public input.
2 Terms that are defined in the glossary (Appendix B) are in italics the firsttime they are used in

the text. 3 The Interim Report can be downloaded from http://www.policy.energy.gov/.
.

-. ' * . ' * " . - 1 : ' * *''***.- ' '.~~~~~~~~~~~~- · 

### EE-RM/STD-9S-440_

# #/30<.: .. Section 1 Introduction

The summer of 1999 was marked by a number ofelectric poweroutages and other powerdisturbances in the eastern interconnection that occurred during periods of extreme heat and humidity.2 These included distribution system failures, as well as shortages ofpower supplies and occurrences oflow voltages in the transmission system. Outages in New York City and Chicago were among the most notable
.. In response to public concerns, at the summermeeting ofthe National Association ofRegulatory Utility Commissioners (NARUC), the Secretary ofEnergy pledgedto investigate several recent major electric powerdisturbances as part ofa six-pointplan to . improve the reliability ofthe U.S. electricpowersystem. The Secretary appointed a panel ofU.S. Department ofEnergy (DQE), national laboratory, and academic**experts~** . called the PowerOutage StudyTeam, orPOST, to conductthe investigations. This is the final report ofPOST's investigation oflast summer's electric reliability problems. Six power outages and two power system disturbances that did not result in outages that took placebetween early June and early August 1999 were studied, and potential federal actions for preventing such events in the future are recommended. POST members visited the affected utilities oroperating entities in the fall 00999
. to learn first-hand about the outages and system disturbances. Members interviewed th'e affected utilities and system operators, as well as other local parties, and reviewed available reports and materials that had been prepared following the events. Without exception, all parties cooperated and supported the team's efforts. The events and the POST's fmdings were described in anInterim Report, dated January

### 4,2000. 3 Section

### 2 ofthis report provides briefsummaries ofthe events drawn from the Interim'Report
.

. Section 3 reports POST's 38 findings from the events. . The Interim Report formed the basis for a series ofthree DOE-sponsored**technic~** workshops at which POST receivedpublic comments on recommendations toconsider. : for this fmal report. Technical workshops were held on January

### 20 in San Francisco, California; January 25 in New Orleans, Louisiana; and January 27 in Newark, New Jersey. More than 150 individuals attended and, ofthose, more than 50 offered public comments at one ormore ofthe workshops. In addition, DOE received more than 70 written comments on the Interim Report. Section4 summarizes the process that the team used to solicit public input.
.
2 Tenns that are defined in the glossary (Appendix B) are in italics the first time**th~y** are Used in
. the text. 3 The Interim Report can be downloaded from http://www.policy.energy.gov/
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## /
Report of theDOEPowerOutageStudy Team on ElectricReliabilityEventsofthe Summerof1999

Section 5 consists ofthe team's recommendations to the Secretary ofEnergy and identifies potential federal actions to help avoid future power outages. The recommendations offered in this report address POST's findings (see Section 3 ofthis report) from its study ofthe significant reliability events from the summer of 1999. Other federal, state, and local actions regarding electric reliability are beyond the scope ofthis report. Appendix A summarizes the comments that POST received. Appendix B provides a glossary ofterms.

# EE.RM/STD.98-440-~**/3~.** Report of the DOEPower Outage Study Team on Electric Reliability Events of the Summer of 1999

2 Section 5 consists ofthe team's recommendations to the Secretary ofEnergy'and identifies potential federal actions to help avoid future power outages. The recommendations offered in this report address POST's findings (see Section 3 ofthis '. report) from its study ofthe significant reliability events from the summer of 1999. Other' federal, state, and local actions regarding electric reliability are beyond the scopeofthis report. Appendix A summarizes the comments that POST received. Appendix B provides a glossary ofterms.

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### EE-RM/STD.98-440-4 /3 , 

# Section 2 Summary of Electric Power System Events Studied by POST

The Secretary ofEnergy appointed POST to review significant power outages and system disturbances that occurred during the summer of 1999 (Table 1). Following this review, the team was directed to suggest actions that the federal government could take to avoid future power outages. Specifically, POST studied six electric power system outages and two other electric power system disturbances that did not lead to outages. Table 1gives the locations and dates ofthese events. The sections that follow briefly summarize each event. Table 1 Summer of 1999: Electric Power Events Studied by POST Event/Location Date Outages

New York City July 6 and 7 Long Island July 3-8 New Jersey July 5-8 Delmarva Peninsula July 6 South-Central states July 23 Chicago July 30-August 12 Powersystem disturbances

New England states June 7and 8 Mid-Atlantic area July 6 and 19


### 2.1 New England: Generation Deficiency on June 7 and 8 ISO-New England (ISO-NE), which initiated operations onJuly 1, 1997, is the nonprofit independentsystem operator(ISO) responsible for operating New England's bulk-powersystem and for administering the region's restructured wholesale electricity market.The New England electric system encompasses Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont. On June 7 and 8, 1999, record-breaking heat and humidity spread across the northeastern United States and much ofcentral and eastern Canada. At that time, many generating units were out ofservice forroutine maintenance and refueling in ':. anticipation ofhigh system demands later in the summer. As a result, the New England, Ontario, and New York regions experienced shortages in reserve electric capacity-and consequent operating emergencies.

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# Section 2. 

# Summary of Electric Power System Events Studied by POSTThe Secretary ofEnergy appointed POST to review significant power outages and system disturbances that occurred during the summer of 1999 (Table I). Following this review, the team was directed to suggest actions that the federal government could take to avoid future poweroutages. Specifically, POST studied six electric power system outages and two otherelectric power system disturbances that did not lead to outages. Table I gives the locations and dates ofthese events. The sections that follow briefly summarize each event. Table 1 Summer of 1999: Electric Power Events Studied by POST EventiLocation Outages

New York City Long Island NewJersey Delmarva Peninsula South-Central states Chicago Powersystem disturbances

NewEngland states Mid-Atlantic area Date July 6 and 7 July 3-8 July 5-8 July 6 July 23 July 30-August 12
June 7 and 8 July 6 and 19


### 2.1 New England: Generation Deficiency on June 7 and 8 ISO-New England (ISO-NE), which initiated operations on July 1, 1997, is the nonprofit independentsystem operator (ISO) responsible for operatingNew England's bulk-powersystem and for administering the region's restructured wholesale electricitY
_ market. The New England electric system encompasses Connecticut, Maine,

- Massachusetts, New Hampshire, Rhode Island, and Vermont. OnJune 7 and 8, 1999, record-breaking heat and humi4!!Y spread across the
_ northeastern United States anamuch ofcentral and eastern Canada. At that time, manygenerating units were out ofservice for routine maintenance and refueling in

- anticipation ofhigh system demands later in the summer. As a result, the NewEngland, Ontario, and New York regions experienced shortages in reserve electric capacity.and consequent operating emergencies.

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### A combination ofemergency responses by ISO-NE, operators ofneighboring systems, electricity customers, the governors ofseveral states, and ultimately a break in the weather enabled ISO-NE to maintain a continuous supply ofelectricity under : demanding circumstances. During this event, ISO-NE received sustained transfers of emergency power from as far away as Michigan. ISO-NE reduced voltages, implemented loadreductions, and received critically important assistance from PJM Interconnection, LLC (PJM), New York, Michigan, Ontario, Quebec, and the Maritime Provinces. Some ofthese systems encountered their own emergencies on these dates. The emergency subsided on the afternoon ofJune 8,when conservation measures took effect and air temperatures cooled. 

### 2.2 New York City: Outages on July6 and 7 Consolidated Edison Company (Con Ed) is a member ofthe New YorkPowerPool (NYPP) and the Northeast Power Coordinating Council. Con Ed serves the most dense electrical loadpocketin the world, with more than 3.1 million customers in a 604-square-mile area. The company uses a unique concept, called a distributed network in which each network operates independently from its neighboring networks and is fed from multiple distribution feeder cables. The networks are designed conservatively so that they can carry load, while being kept energized even iftwo or three feeders (depending on the load) are lost. On July 6, 1999, the Washington Heights network in northern Manhattan had to be de-energized for 19 hours after the distribution networklost 8 ofits 14 feeder cables. The loss offeeders occurred because ofheat-related failures in connections, cables, and transformers. Power to 68,000 customers (representing a population of200,000) was interrupted. TheWashington Heights network was re-energized at about 5:00 p.m. on . July 7,after repairs had been made. 

### 2.3 Long Island: Outages and Depressed Voltages on July3-8 The Long Island Power Authority (LIPA) -an organization ofthe State of New York

- acquired the Long Island transmission and distribution (T&D) system from the Long Island Lighting Company in 1998. Keyspan Energy operates the system under contract from LIPA. From July 3 through 8,service was interrupted to a total of 110,000 LIPA customers -' for varying periods. A new systempeak loadof4,340 MW was set on July 5,and that record was broken theTofowing day (July 6) when the peak load reached 4,590 MW (a 9.1% increase over the previous year). On July 6, NYPP ordered a systemwide 5% voltage reduction, and LIPA activated its Commercial Peak Reduction Program and appealed to its other large customers to voluntarily curtailtheiruse of.electricity. Many organizations and government offices responded by closing early or cutting back on their
. electricity use. The South Fork ofLong Island

- an area that has experienced rapid load growth

- was onthe edge ofvoltage collapse.Voltage collapse probably would have occurred ifthepeakdemandhad not been reduced as a result ofvoluntary load curtailment procedures, a 5%voltage reduction, and load decreases associated with

: 4 ' * .. -* ; ;

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### EE-RM/STD-9S-440

# 4'**I~-:** 

# -
Reportof the DOEPower Outage Study Team on Electric ReliabilityEvents of the Summer of 1999

A combination ofemergency responses byISO-NE, operators ofneighboring systems, electricity customers, the governors ofseveral states, and ultimately a break in

_ the weather enabled ISO-NE to maintain a continuous supply ofelectricityunder demanding circumstances. During**~his** event, ISO-NE received sustained transfersof emergency power from as far away as Michigan. ISO-NE reduced voltages, implemented loadreductions, and received-critically important assistance from PJM Interconnection, LLC (PJM), New York, Michigan, Ontario, Quebec, and the Maritime Provinces. Some ofthese systems encountered their ownemergencies onthese dates. The emergency subsided on the afternoon ofJune 8, when conservation measures took effect and air temperatures cooled. 

### 2.2 New York City: Outages on July 6 and 7 Consolidated Edison Company (Con Ed) is a member ofthe New YorkPowerPool (NYPP) and the Northeast Power Coordinating Council. Con Ed serves the most dense electrical loadpocket in the world, with more than 3.1 million customers in a 604-square-mile area. The company uses a unique concept, called a distributed network, in which each network operates independently from its neighboring networks and is fed from multiple distribution feeder cables. The networks are designed conservatively so that they can carry load, while beingkept energized even iftwo orthree feeders (depending on the load) are lost. OnJuly 6, 1999, the Washington Heights network in northern Manhattan hadtobe de-energized for 19 hours after the distribution network lost 8 ofits 14 feeder cables. The loss offeeders occurred because ofheat-related failures in connections, cables, and transformers. Power to 68,000 customers (representing a popUlation of200,000) Was interrupted. The Washington Heights network was re-energized at about 5:00 p.m. on July 7, after repairs had been made. .' 

### 2.3 Long Island: Outages and Depressed Voltages on July 

### 3-8

4 TheLong Island Power Authority (LIPA)

- an organization ofthe State of New York

- acquired the Long Island transmission and distribution (T&0) system from the Long Island Lighting Company in 1998. Keyspan Energy operates the systemunder contract from LIPA. FromJuly 3 through 8, service was interrupted to a total of 110,000

### LIPA~ustomers' for varying periods. A new systempeakload of4,340 MW was set on July 5, aridthatrecord was broken therOIIowing aay (July 6) when the peak load reached 4,590 MW (a 9.1

### % increase over the previous year). On July 6, NYPP ordered a systemwide
_ 5% voltage reduction, and LIPA activated its Commercial PeakReduction Prograffi" and appealed to its other large customers to voluntarily curtail theiruse of electricity. Many organizations and government offices responded by closing early or cutting back ontheir. electricity use. The South Fork ofLong Island

- an area that has experiencedrapid load growth

- was on the edge ofvoltage collapse. Voltage collapse probably would have occurred ifthepeakdemandhad not been reduced as a result ofvoluntary load,
. curtailmentprocedures, a 5% voltage reduction, and load decreases aSsociated with ::- .-

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### overloaded wire burndowns. The peak load in the South Fork on July 5 was 25% higher than it was in 1998. 

### 2.4 Mid-Atlantic Area: Voltage Declines on July6 and 19 PJM Interconnection, LLC, is an ISO that serves as (1)the regional transmission provider responsible for transmission planning, (2) a controlareaoperator, (3)a North AmericanElectricReliabilityCouncil(NERC)securitycoordinator, and (4) operator of 

### the Mid-Atlantic integrated energy market. PJM is the largest centrally dispatched electric power system in North America. The system encompasses New Jersey; Delaware; the District ofColumbia; and parts ofPennsylvania, Maryland, and Virginia. On two occasions in July, the eastern halfofthe PJMgridexperienced sudden and steep voltage declines. The first occurred on July 6, during the heat storm that affected much ofthe East from New England down past the Mid-Atlantic. An all-time-high peak load (51,600 MW), which was notpredicted to occur until 2002, was recorded for the PJM grid that day. A similar voltage problem occurred during another period ofhigh loads on July 19. The integrity ofthe PJM system was maintained, however, on both July 6 and 19, because emergency actions were put in place to reduce voltage, curtail contractually interruptible customers, start up maximum emergency generation, appeal for voluntary load reductions, and curtail emergency exports. The more rapid recovery onJuly 19 may be partially explained byPJM's implementation ofsome ofthe lessons it had learned on July 6. 

## 2.5 New Jersey: Outages on July 5-8 POST studied three outages that occurred at two New Jersey utilities during the heat wave that took place in early July. Public Service Electric and Gas Company (PSE&G) is a wholly owned subsidiary ofPublic Service Enterprise Group Incorporated. PSE&G supplies electric and gas service to approximately 5.5 million people in a corridor of roughly 2,600 square miles that runs diagonally across New Jersey, from Bergen County in the northeast to an area below the city ofCamden in the southwest. GPU, Inc., is a holding company that owns all ofthe outstanding common stock ofthree electric utilities serving customers in New Jersey (Jersey Central Power &Light Company, Pennsylvania-Metropolitan Edison Company, and Pennsylvania Electric Company), which are operatedjointly as GPU Energy. PSE&G suffered outages related to recurrent cable and switchgear troubles at several ofits substations and on the 26-kV Bergen County loop. The Hudson Terrace and Citibank substations were shut down once, and the Englewood substation was shut down twice. Up to 10,000 customers at a time were affected for periods ofless than one hour each during the service interruptions. Multiple terminator and cable failures affected three ofthe four transformers at the City Dock substation in downtown Newark, New Jersey. PSE&G shut down the entire substation to protect the remaining transformer

' - . 5 :-

- - -- 

### EE-RM/STD-9S-440

# -1F-/~

# -'
Report of the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summer a

overloaded wire burndowns. The peak load in the South Fork on July 5 was**25o/~** higher- , than it was in 1998. 

### 2.4 Mid-Atlantic Area: Voltage Declines on July 6 and 19 PJM Interconnection, LLC, is an ISO that serves as (1) the regional transmission providerresponsible for transmission planning, (2) a control area operator, (3) a North American ElectricReliability Council (NERC) security coordinator, and (4) operator of the Mid-Atlantic integrated energy market. PJM is the largest centrally dispatched electric power system in North America. The system encompasses New Jersey; Delaware; the District ofColumbia; and parts ofPennsylvania, Maryland, and Virginia. On two occasions in July, the eastern halfofthe PJMgridexperienced sudden and steep voltage declines. The fIrst occurred on July 6, during the**~at** storm that affected, much ofthe East from New England down past the Mid-Atlantic. An all-time-high peak load (51,600 MW), which was not predicted to occuruntil 2002, was recorded for the PJM grid that day. A similar voltage problem occurred during anotherperiod ofhigh loads on July 19. The integrity ofthe PJM system was maintained, however, on both July 6 and 19, because emergency actions were put in place to reduce voltage, curtail contractually interruptible customers, start up maximum emergency generation, appeal for voluntary load reductions, and curtail emergency exports. The more rapid recovery on July 19 may be partially explainedby PJM's implementation ofsome ofthe lessons it had learned on July 6. 

### 2.5 New Jersey: Outages on July 

### 5-8 POST studied three outages that occurred at two NewJersey utilities during the heat wave that took place in early July. Public Service Electric and Gas Company (pSE&G) is a wholly owned subsidiary ofPublic Service Enterprise Group Incorporated. PSE&G

-,- supplies electric and gas service to approximately 5.5 million people in a corridor of roughly 2,600 square miles that runs diagonally across New Jersey, from Bergen County in the northeast to an area below the city ofCamden in the southwest. GPU, 

### Inc., is a - holding company that owns all ofthe outstanding common stock ofthree electric utilities serving customers in New Jersey (Jersey Central Power & Light Company, Pennsylvania-Metropolitan Edison Company, and Pennsylvania Electric Company);'

- which are operatedjointly as GPUEnergy. ' - ' PSE&G suffered outages related to recurrent cable and switchgear troubles at several ofits substations and on the 26-kV Bergen County loop. The Hudson Terrace and Citibank substations were shut down once, and the Englewood substation was shut down twice. Up to 10,000 customers at a time were affected for periods ofless than one hour each during the service interruptions. Multiple terminator and cable failures affected three ofthe four transformers at the City Dock substation in downtown Newark, , New Jersey. PSE&G shut down the entire substation to protect the remaining transformer.,

, - 5 " -

## EE-RM/STD-98-44 4 0 - t
ReportoftheDOE PowerOutageStudy Team on ElectricReliabilityEvents ofthe Summerof1999' 

### affecting 2,600 customers. Service was restored to several large customers within -· -. 2 hours, and service was restored to all customers in less than 11 hours.
. Starting onJuly 5, GPU Energy suffered outages resulting from problems with the four transformers at its Red Bank substation. Two transformers were severely damaged and had tobe replaced. Scheduled and unscheduled outages affected more than 100,000 customers. Service was restored to all customers by 1:20 a.m. on July 8. 

### 2.6 Delmarva Peninsula: Outages on July6 Delmarva Power & Light Company (DPL) is a wholly owned subsidiary of Conectiv. DPL provides electricity to approximately 455,300 customers within its service territory, which includes Delaware, 10 primarily eastern shore counties in Maryland, and the eastern shore ofVirginia. .-- . The DPL system was severely affected by the first heat wave ofJuly 1999, which for DPL extended from July 3 to July 6. High loads, in combination with various generation outages, produced a capacity shortfailthat could not be remedied through energy imports on the transmission system. On the worst day, July 6, DPL implemented rotating outages from 10:30 a.m. until 7:30 p.m. Approximately 138,000 customers experienced outages ofvarying duration and frequency. Subsequent studies performed by POST (reported in the Interim Report) and others indicate that the DPL operator concerns regarding imminent voltage collapse were well founded. 

### 2.7 South-Central States: Rotating Outages on July23 - Entergy is a vertically integrated power company that serves approximately 2.5 million customers in parts ofLouisiana, Arkansas, Texas, and Mississippi. It is a member ofthe Southeastern Electric Reliability Council and participates in a reserve sharing agreement with the Southwest Power Pool (SPP). Entergy has about one-third of the total SPP load. On the basis ofload forecasts and reports on expected generator availabilityon July 22, Entergy anticipated that it would be able to meet its reserve requirements on July 23, with the curtailment ofsome interruptible and curtailable retail loads. However,.::. by the morning ofJuly 23, the situation had worsened; load forecasts for the day were slightly higher, while generator availability was lower than anticipated. Throughout the day, equipment problems further reduced generating capabilityat several units. Atnoon,.. Entergy made a public appeal for conservation

- only its third such request in 20 years. During the afternoon, Entergy received emergency assistance from SPP for more than an hour. As this period ofassistance came to an end, nonfirm capacity purchaseswere recalled because ofhigh demands and widespread shortages throughout the region, while additional generation capability was forced out ofservice. The combination ofthese events led Entergy to begin curtailing 900 MW offirm load by mid-afternoon. Customer : outages occurred on a 20- to 30-minute cycle. Ultimately, more than 550,000 customers experienced at least one outage that afternoon.

6 

### EE-RM/STD-98-440'--#

# 13??/

.Report of the DOEPower Outage Study Team on Electric ReliabilityEvents of the Summer of 1999
affecting 2,600 customers. Service was restored to several large customers within. 2 hours, and service was restored to all customers in less than 11 hours. - . Starting on July 5, GPU Energy suffered outages resulting"from problerris with the four transformers at its Red Bank substation. Two transformers were severely daIDaged and had to be replaced. Scheduled and unscheduled outages affected more than 100,000 customers. Service was restored to all customers by 1:20 a.m. on July 8. 

### 2.6 Delmarva Peninsula: Outages on July 6 Delmarva Power & Light Company (DPL) is a wholly owned subsidiary of Conectiv. DPL provides electricityto approximately455,300 customers within its service territory, which includes Delaware, 10 primarily eastern shore counties 

### in Maryland, and the eastern shore ofVirginia. The DPL system was severely affected bythe first heat wave ofJuly 1999, whiCh for DPL extended from July 3 to July 6. High loads, in

### c~bination with various generation outages, produced a capacity Shortfall that could not beremedied through energy imports on the transmission system. On the worst day, July 6, DPL implemented rotating outages from 10:30 a.m. until 7:30 p.m. Approximately 138,000 customers experienced outages ofvarying duration and frequency. Subsequent studies performed by POST (reported in the Interim Report) and others indicate that the DPL operator concerns regarding imminent voltage collapse were well founded. 

### 2.7 South-Central States: Rotating Outages on July 23

6 Entergy is a vertically integrated power company that serves approximately 2.5 millioncustomers in parts ofLouisiana, Arkansas, Texas, and Mississippi. Itis a member ofthe Southeastern Electric Reliability Council and participates in a reserve sharing agreement with the Southwest Power Pool (SPP). Entergyhas about one-third of the total SPP load. On the basis ofload forecasts and reports on expected generator availabilityon . July 22, Entergy anticipated that it would be able to meet its reserve requirements on July23, with the curtailment ofsome interruptible and curtailable retail loads. However,
..:. by the morning ofJuly 23, the situation had worsened; load forecasts for the day were' slightly higher, while generator availability was lower than anticipated. Throughout the ..• day, equipment problems further reduced generating capability at several units"Atnoon, . Entergy made a public appeal for conservation

- only its third such request in 20 yea.r.s. During the afternoon, Entergy received emergency assistance from SPP for more than

# an .' hour. As this period ofassistance came to an end, nonjirm capacitypurchases were . :. recalled because ofhigh demands and widespread shortages throughout the region, while additional generation capability was forced out ofservice. The combination ofthese events led Entergy to begin curtailing 900 MW offirm load bymid-afternoon. Customer outages occurred on a 20- to 30-minute cycle. Ultimately, more than 550,000 customers experienced at least orie outage that afternoon. 

### - .

. .,. ..

.": ,".**~.** ;

## EE-RM/STD-98-440 

# /3
Reportof theDOE PowerOutageStudy Team on ElectricReliabilityEvents oftheSummerof1999 

### 2.8 Chicago: Outages on July 30-August 12 Commonwealth Edison (ComEd) is the principal utility subsidiary ofits parent company, Unicom. ComEd provides electricity to more than 3.4 million customers in northern Illinois. The ComEd T&D system is typical oftransmission and distribution in the electric industry in that it consists mainly ofnetworked underground systems, located primarily in Chicago; overhead systems in urban, suburban, and rural areas; and underground residential systems in urban and suburban areas. Between July 30 and August 12, three major distribution system outages occurred in ComEd's service territory in Chicago at the Northwest, Lakeview, and Jefferson substations. During a period ofintense heat and humidity, ComEd recorded an all-timehigh peak demand on July 30. In the late afternoon, the electric system began to experience difficulties. Two separate cable faults at the Northwest substation deenergized transformers, thereby overloading nearby interconnected transformers and causing them to shut down automatically toprevent equipment damage. Seven cable faults in and around the Lakeview substation also caused outages. Over the July 30 to August 1period, more than 100,000 customers suffered temporary losses ofpower for up to several hours. ComEd's Jefferson substation, which serves Chicago's greater downtown area (including businesses in the "Loop") plays a critical role in the topology ofComEd's system because it is the sole path ofpower for six downstream substations. Power interruptions on August 12 to customers served by the Jefferson substation resulted from intentional loadshedding,which ComEd elected to do to protect overloaded equipment. Transformer problems and multiple cable faults were the primary causes ofoverloading. The largest number ofcustomers simultaneously without service as a result ofthe intentional actions taken by ComEd was less than 3,300 (however, since many ofthese customers are large businesses, the number ofpeople affected was much greater than 3,300). To prepare for service interruptions in the south Loop, ComEd personnel sent warnings about potential emergency power outages; these reached many unaffected customers in the area. ComEd staffsuggested that a significant number ofcustomers who did not experience interruptions in electric power chose to suspend business operations in anticipation ofpossible interruptions. 

### 2.9 Follow-up Activities The power outages and system disturbances that POST studied have also been." subject to follow-up activities by the companies and organizations that experienced : them, as well as, in some cases, by local regulatory authorities. Other studies and reviews have been conducted or are underway, and many follow-up actions have been announced and implemented. By design, these activities have been confined primarily to the specific events and companies or organizations affected. In this regard, the national focus ofthis report complements the local studies because it looks at these events from a national perspective.

.. Reportof the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summerof 1999**-------~:.!:...:.....:.....:~:..:....::.....:....::~::........;:.-....:...;,...,;;:;!..:;...::..:..:....:..::....--..,;...---------::....-----::...----""'"--..,.-** -..**~,..~~-** 

### ·2.8 Chicago: Outages on July 30-August 12 Commonwealth Edison (CornEd) is the principal utility subsidiary ofits parent . company, Unicorn. CornEd provides electricity to more than 3.4 million customers in northern lllinois. The CornEd T&D system is typical oftransmission and distribution in the electric industry in that it consists mainly ofnetworked underground systems, located primarily in Chicago; overhead systems in urban, suburban, and rural areas; and underground residential systems in urban and suburban areas. Between July 30 and August 12, three major distribution system outages occurred in CornEd's service territory in Chicago at the Northwest, Lakeview, and Jefferson substations. During a period ofintense heat and humidity, CornEd recorded an all-timehigh peak demand on July 30. In the late afternoon, the electric system began t; experience dIfficulties. Two separate cable faults at the Northwest substation deenergized transformers, thereby overloading nearby interconnected transformers and causing them to shut down automatically to prevent equipment damage. Seven cable faults in and around the Lakeview substation also caused outages. Overthe July 30to August 1period, more than 100,000 customers suffered temporary losses ofpower for up to several hours. CornEd's Jefferson substation, which serves Chicago's greater downtown area (including businesses in the "Loop") plays a critical role in the topology ofComEd's system because it is the sole path ofpowerfor six downstream substations. Power interruptions on August 12 to customers servedby thelefferson substation resulted from intentional loadshedding, which CornEd elected to do to protect overloaded equipment.
. Transformer problems and multiple cable faults were the primary causes ofoverloading. The largest number ofcustomers simultaneously without service as a result ofthe intentional actions taken by CornEd was less than 3,300 (however, since many ofthese
. customers are large businesses, the number ofpeople affected was much greater than 3,300). To prepare for service interruptions in the south Loop, CornEd personnel sent warnings about potential emergency power outages; these reached many unaffected
. customers in the area. CornEd staffsuggested that a significant number ofcustomers who did not experience interruptions in electric power chose to suspendbusiness operations in anticipation ofpossible interruptions. 

### 2.9 Follow-up Activities The power outages and system disturbances that POST studied have also been· subject to follow-up activities bythe companies and organizations that experienced them, as well as, in some cases, by local regulatory authorities. Other studies·an"dreviews have been conducted orare underway, and many follow-up actions have been announced and implemented. Bydesign, these activities have been confined prirrurrily to the specific events and companies ororganizations affected. In this regard, the national focus ofthis report complements the local studies because it looks at these events from a national perspective. .\

-**.~**

### EE-RM/STD-98-440o-' 

## /C 

# Section 3 Summary of POST Findings

POST's study of the events reported in Section 2 resulted in 38 findings, which were specific to the events studied. The 38 findings are presented below by power system event. 

### 3.1 New England 1. Electricity suppliers respond to market signals, but thereis a lag ofseveral years before new generation resources can be placed into service. Most ofthe states in New England have implemented some form ofcompetition for the provision ofenergy services. High electricity prices and several summers oflow generation reserves as a result ofthe early retirement ofseveral nuclear power plants have led generation companies to propose adding more than 30,000 MW of new capacity. This amount represents more than the total existing capacity in the area. Although much ofthis new capacity will never be built, many are predicting a generation surplus in New England within a few years. Such predictions clearly indicate that this aspect ofthe generation market is working in New England. However, it does take time to build new generation facilities, and there has historically been a lag between the time when generation is needed and when it becomes available. 2. Retail customers have limited mechanisms and incentives to conserve energy or resort to alternatives duringelectricity shortages. ISO-NE had to resort to public appeals for conservation, including the step ofasking the New England governors to close nonessential facilities. 3. Market rules for system operation duringtimes ofsystem emergencies have not been fully developed or agreed upon by market participants. The reliability event ofJune 7 and 8 uncovered many market flaws, including the inability to (1) forecast market clearing priceswhen supplies are scarce and (2) manage pump storage and must-run resourcesthat are above the energy clearing price. 4. Some independent system operators were lacking the needed authority to arrange energy transfersduring emergency conditions. Some ofthe ISOs involved in the June 8 delivery ofemergency power from Michigan to New England did not have well-defined emergency procedures to conduct the transactions. 

### 3.2 New York City 5. Cable condition is not accurately assessed by conventional diagnostics and practices, which may accelerate cable failure. Conventional cable testing methods, such as direct-current (DC) high-potential testing, are not always able to detect degradation or incipient failure in cable systems. In fact, the DC highpotential cable testing method being used by Con Ed may actually be aggravating

8**-~~~~------------** 

### EE-RM/STD-98-440

# :-f/1309~· Section 3 

# Summary of POST Findings

POST's study ofthe events reported in Section 2 resulted in 38 fmdings, which were specific to the events studied. The 38 findings are presented below by power system event. 

### 3.1 New England 1. Electricity suppliers respond to market signals, butthere is a lag ofseveral years before new generation resources can be placed into service. Most ofthe states in New England have implemented some form ofcompetition for the provision ofenergy services. High electricity prices and several summers oflow generation reserves as a result ofthe early retirement ofseveral nuclearpower plants have led generation companies to propose adding more than 30,000 MW of new capacity. This amount represents more than the total existing capacity in the
. area. Although much ofthis new capacity wiII never be built, many are predictinga generation surplus in New England within a few years. Such predictions clearly indicate that this aspect ofthe generation market is working in New England. However, it does take time to build new generation facilities, and there has historicallybeen a lag between the time when generation is needed and when it
. becomes available. 2. Retail customers have limited mechanisms and incentives to conserve energy or resort to alternatives during electricity shortages. ISO-NE had to resort to public appeals for conservation, including the step ofasking the New England governors to close nonessential facilities. 3. Marketrules for system operation during times ofsystem emergencies have notbeen fully developed or agreed upon by marketparticipants. The reliability event ofJune 7 and 8 uncovered many market flaws, including the inability to (1) forecast market clearingprices 

### when supplies are scarce and (2) manage pump storage and must-run resources 

### that are above the energy clearing price. 4. Some independent system operators were lacking the needed authority to arrange energy transfers during emergency conditions. Some ofthe ISOs involved in the June 8 delivery ofemergencypowerfrom Michigan to New J:;ngland did not have well-defmed emergency procedures to conduct the transactions. 

### 3.2 New York 

### City

8 

### 5. Cable condition is not accurately assessed by conventional dillgilostics and practices, which may accelerate cable failure. Conventional cable testing methods, such as direct-current (DC) high-potential testing, are not always able to . detect degradation or incipient failure in cable systems. In 

### fact, the DC highpotential cable testing method being used by Con Ed may actually be aggravating. 

## ... - .

## EE-RM/STD-98-440- 4 -/3c
Reportofthe DOEPowerOutageStudy Team on Electric ReliabilityEvents of the Summer of1999
potential failure spots in the cables. Each spring, Con Ed routinely tests cables all over the city to prepare for the summer peak. Four ofthe feeder cables from the Sherman Creek substation had been tested in the spring of 1999. Three ofthe four cables had passed the test but subsequently failed during the July 6 outage. The fourth cable failed the test but was repaired and did not fail during the outage. The fact that three cables that passed the test failed later during the heat storm may be an indicator ofa testing deficiency that actually contributes to cable failure. There is presently a debate in the industry over the best way to test the insulation of distribution cables. Many ofCon Ed's 13.8-kV feeder cables are insulated with cross-linked polyethylene (XLPE). Studies suggest that DC high-potential testing on aged cable with this type ofinsulation may induce failures. The practice ofusing the DC test on cables has carried over from the time when older paper-oil types of cable insulation that are not degraded by the DCtest were used. In the Con Ed feeders, XLPE-insulated cable is sometimes spliced in to replace sections ofpaperoil cable, so both cable types can exist in the same feeder. 6. Real-time data on cable temperatureare not available. The secondary lowvoltage distribution system contains a large number ofconductors in parallel in many possible combinations. Calculating the power flow and temperature rise for each combination ofconductors requires a highly sophisticated analysis. In addition, individual network conductors are protected by fusible links, and there are no remote indications when these links are open. Thus, the thermal model can only really estimate the temperature rise ofindividual conductors. Real-time data on the actual thermal condition ofthe network cables (either calculated or measured) is not available. 7. The harsh environment in which cables are located contributes to reliability problems. The salt that the city uses on the streets in the winter gets into the cable vaults, manholes, and conduits. Con Ed can actually plot the customer interruption rate versus the tonnage of salt used by the city and find a remarkably good correlation. During its visit to New York, the POST observed that the vaults were also contaminated by oil from car engines and a variety ofother trash that fell through the grating. The manholes, vaults, and conduits are also routinely flooded during heavy rains and water main leaks. The combination of salt, water, oil, and constant high humidity is an extremely severe environment for cables. Leadjackets on the cable, which are very effective in these harsh environments, can no longer be used because ofenvironmental concerns. 

### 3.3 Long Island 8. Load predictions have been inadequate. Load growth has been unusually rapid. In some areas, the peak load increased more than 25% in the last year. T&D capability has notkept up with load growth. There is a perception that load forecasting has been inadequate over the last two or three years. The review ofthe capability and condition ofthe existing infrastructure might not have been adequate. For example,

9 

### EE-RM/STD-98-440
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# #13~. 

# '

Reportof the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of1999,.
potential failure spots in the cables. Each spring, Con Edroutinely tests cables all ' overthe city to prepare for the summerpeak. Four ofthe feeder cables from the Sherman Creek substation had been tested in the spring of 1999. Three ofthe foUr' cables had passed the test but subsequently failed during the July 6 outage. The fourth cable failed the test but was repaired and did not fail during the outage. The fact that three cables that passed the test failed later during the heat storm may be an indicator ofa testing deficiency that actually contributes to cable failure. There is presently a debate in the industry over the best way to test the insulation of distribution cables. Many ofCon Ed's 13.8-kV feeder cables are insulated with cross-linked polyethylene (XLPE). Studies suggest that DC high-potential testing on aged cable with this type ofinsulation may induce failures. The practice ofusing the DC test on cables has carried over from the time when olderpaper-oil types of cable insulation that are not degraded by the DC test were used. Inthe ConEd feeders, XLPE-insulated cable is sometimes spliced in to replace sections ofpaperoil cable, so both cable types can exist in the same feeder. 6. Real-time data on cable temperature are not available. The secondary lowvoltage distribution system contains a large number ofconductors in parallel in many possible combinations. Calculating the power flow and temperature rise for each combination ofconductors requires a highly sophisticated analysis. In addition, individual network conductors are protected by fusible links, and there are no remote indications when these links are open. Thus, the thermal model can only really estimate the temperature rise ofindividual conductors. Real-time data on the actual thermal condition ofthe network cables (either calculated ormeasured) is not' available. 7. The harsh environmentin which cables are located contributesto reliability problems. The salt that the city uses on the streets in the winter gets into the cable vaults, manholes, and conduits. Con Ed can actually plot the customerinterruption rate versus the tonnage ofsalt used bythe city and fmd a remarkably good correlation. During its visit to New York, the POST observed that the vaults were also contaminated by oil from car engines and a variety ofothertrash that fell through the grating. The manholes, vaults, and conduits are also routinely flooded, during heavy rains and water main leaks. The combination ofsalt, water, oil, and, constant high humidity is an extremely severe environment for cables. Leadjackets on the cable, which are very effective in these harsh environments, can no longer be usedbecause ofenvironmental concerns. 

### 3.3 Long Island 8. Load predictions have been inadequate. Load growth has been'unusually rapid. In some areas, the peak load increased more than 25% in thelast year. T&D capability has not kept up with load growth. There is a perception that loadforecasting has ' been inadequate over the last two orthree years. The review ofthe capability and condition ofthe existing infrastructure might nothave been adequate. Forexample,

9

### EE-RM/STD-98-440 - 7 / ~ Reportof theDOEPowerOutageStudy Team on ElectricReliabilityEvents ofthe Summerof1999


### the predicted 1999 summer peak for the South Fork was 141 megavolts-ampere (MVA), while the actual peak was 167 MVA, 18% higher than the forecast. Although much ofthe increase resulted from the booming economy, LIPA
. forecasting methods still appear to be inadequate. 9. Transformer failure and associated interconnection problems can require lengthy equipment repairtimes. LIPA import capability was reduced by 430 MW because two key transformers providing interconnections to the NYPP and New England Power Pool had failed in the spring. These transformers could not be replaced quickly and had tobe repaired because they were unique, nonstandard designs. Therepair time was on the order ofone year. Replacing large transformers requires a very long lead time. 10. Traditional methods (e.g., construction of new transmission and central generation) for supplying electric power to load pockets were not able to keep up with load growth. The South Fork ofLong Island was on the edge ofvoltage collapse because new generation and transmission had not kept up with the load growth. Load growth had been extremely rapid, with an increase in peak load up to 25% in one year. There has been local resistance to the construction ofnew, highervoltage transmission lines and new generating stations in the area. 

### 3.4 Mid-Atlantic Area 11. Unit ratings were not consistent with operating performance during periods of high loads. When PJM called for maximum production ofreactive power,many generating units were not able toprovide levels ofrealand reactivepower - consistent with their expected capabilities. This was evident during both the July 6 and 19 events. Immediately following the event on July 19, PJM instructed all generators to re-rate units fortheir ability to produce reactive power. 12. There may not be adequate incentives for reactive power production. At the time ofthese events, there were noeconomic incentives for generators toproduce reactive power. In fact, there was a disincentive, since generators operating at full capacity generally have to cut back on real energy production to increase reactive power production (as requested by PJM during these reliability events). Thus, their sales and earnings are reduced. The Federal EnergyRegulatoryCommission 

### (FERC)has since approved a tarif for PJM to compensate generators for lost opportunity costs. 13. Planning tools did notpredict significant voltage degradation during periods of high loads. PJM operators were surprised by each ofthese events. The severe declines in voltages were notpredicted forthe operating conditions.being experienced. The duration ofthe voltage decay on July 6 could be an indication ofa delayed response to the problem or a lack ofadequate policies and procedures to address the issue. When the tools and experience topredict and respond to such events are not available, there is a risk ofvoltage collapse.

10**~** . Report o/theDOEPower Outage Study Team on Electric ReliabilityEvents o/theSummer 0/1999

the predicted 1999 summerpeak for the South Fork was 141 megavolts-ampere (MV A), while the actual peak was 167 MVA, 18% higher than the forecast. Although much ofthe increase resulted from the booming economy,**LIP~:.** forecasting methods still appear to be inadequate.
. 9. Transformer failure and associated interconnection problems can require lengthy equipment repair times. LIPA import capability was reduced by430 MW because two key transformers providing interconnections to the NYPP and New England Power Pool had failed in the spring. These transformers could not be replaced quickly and had to be repaired because they were unique, nonstandard designs. The repair time was on the order ofone year. Replacing large transformers requires a very long lead time. 10
..Traditional methods (e.g., construction ofnew transmission and central generation) for supplying electric powerto load pockets were not able to keep up with load growth. The South Fork ofLong Island was on the edge ofvoltage collapse because new generation and transmission had not kept up with the load growth. Load growth had been extremely rapid, with an increase in peak load up to 25% in one year. There has been local resistance to the construction ofnew, highervoltage transmission lines and new generating stations in the area. 

### 3.4 Mid-Atlantic Area

10 11. Unit ratings were not consistent with operatingperformance during periods of high loads. When PJM called for maximum production ofreactivepower,many generating units were not able to provide levels ofreal and reactivepower .. consistent with their expected capabilities. This was evident during boththe July 6 and 19 events. Immediately following the event on July 19, PlM instructed all generators to re-rate units for their ability to produce reactive power. 12. There may not be adequate incentives for reactive powerproduction.Atthe time ofthese events, there were no economic incentives for generators to produce reactive power. In fact, there was a disincentive, since generators operating at full capacity generally have to cut back onreal energy production to increase reactive powerproduction (as requested by PJM during these reliability events). Thus, their sales and earnings are reduced. The FederalEnergyRegulatory Commission (FERC) has since approved a tarifJfor PlMto compensate generators for lost opportunity costs. 13. Planningtools did notpredict significant voltage degradation during periods of high loads. PJM operators were surprised by each ofthese events. The severe . declines in voltages were not predicted for the operating conditions.being experienced. The duration ofthe voltage decay on July 6 could be an hldication ofa delayed response to the problem or a lack ofadequate**policie~** and procedures 

### to address the issue. When the tools and experience to predict and respond to such· events are not available, there is a risk ofvoltage collapse.

### EE-RM/STD-98-440

_ /C 3 

### c Reportof theDOE Power OutageStudy Team on ElectricReliabilityEvents oftheSummer of1999


### 3.5 New Jersey 14. There are no reliable tests for identifying incipient failures in feeder cables. PSE&G experienced multiple cable failures at its Englewood and City Dock substations. PSE&G staffinformed POST that improved testing methods are needed to identify incipient cable failures, and that the company has begun a pilot program oflow-frequency discharge testing for paper-insulated and lead-covered cables. 15. Mechanisms for sharing information on maintenance best practices and equipment performance among distributionutilities were inadequate. There are few incentives for sharing data on equipment maintenance and performance characteristics. In some cases, research in this area is proprietary and not readily available to all utilities. 16. Utilities may experience lengthy delays in replacing failed critical equipment. The GPU system has approximately 50 transformers like the ones that failed at its Red Bank substation, and at the time ofthose failures, it had only two spare transformers. Luckily, those were stored at the Red Bank substation. Large transformers like these are difficult to move because oftheir size and weight (more than 200 tons). Replacement or repair oflarge transformers can take a year or longer. Since the transformer failures at Red Bank, GPU is considering increasing the number ofspares it keeps from two to four. 3.6 Delmarva Peninsula 17. Forecasting methods used by system planners did not accurately predict peak summer loads. The severity and longevity ofthe heat and humidity duringthis reliability event were very unusual. DPL did notplan for the loads associated with these conditions. 18. Summer ratings for electric generating units were calculated for normal summer temperatures and were not consistent with performance during periods ofunusually high temperatures. During periods ofhigh temperatures and humidity, generating units generally do not perform as well as they do during times ofnormal temperatures. Peak summer loads are associated with high temperatures and humidity, and it is precisely at that time that unit ratings are critical toreliable operations. Planning and operations need tobe based on ratings that are relevant at the time ofpeak loads. 19. Retail customers have limited mechanisms and incentives to conserve energy or resortto alternatives duringelectricity shortages. DPL's reserves were depleted on July 6, and operators had toresort to rotating outages to reduce load when Indian River Unit 2 (IR2) was forced out ofservice. 20. Notice requirements in load management contracts do not permit an efficient response to emergencies. DPL contracts for interruptible loads are not amenable to quickly responding to generator outages. Contracts for interruptible loads require 

### EE-RM/STD-98-440-#= 

# /3c;< IReportof the DOEPower Outage Study Team on ElectricReliabilityEvents of theSummer of1999


### 3.5 New Jersey 14. There are no reliable tests for identifying incipient failures in feeder cables. PSE&G experienced multiple cable failures at its Englewood and City Dock substations. PSE&G staffinformed POST that improved testing methods are needed to identify incipient cable failures, and that the company has begun a pilot program of

### low-Jrequency discharge testing for paper-insulated and lead-covered cables. 15. Mechanisms for sharinginformation on maintenance best practices and equipment performance among distribution utilities were inadequate. There are few incentives for sharing data on equipment maintenance and performance characteristics. In some cases, research in this area is proprietary and not readily available to all utilities. 16. Utilities may experience lengthy delays in replacing failed critical equipment. The GPU system has approximately 50 transformers like the ones that failed at its Red Bank substation, and at the time ofthose failures, it had only two spare transformers. Luckily, those were stored at the Red Bank substation: Large transformers like these are difficult to move because oftheir size and weight (more than 200 tons). Replacement or repair oflarge transformers can take a year or longer. Since the transformerfailures at Red Bank, GPU is considering increasing the number ofspares it keeps from two to four. 

### 3.6 Delmarva Peninsula 17. Forecasting methods used by system planners did not accurately predict peak summer loads. The severity and longevity ofthe heat and humidity during this reliability event were very unusual. DPL did not plan for the loads assoCiated with these conditions. 18. Summerratings for-electric generating units were calculated for normal summertemperatures and were not consistent with performance during periods ofunusually high temperatures. During periods ofhigh temperatures and
_ humidity, generating units generally do notperform as well as they do during times ofnonnal temperatures. Peak summer loads are associated with high temperatures and humidity, and it is precisely at that time that unit ratings are critical to reliable operations. Planning and operations need to be based on ratings that are relevant at the time ofpeak loads. 19. Retail customers have limited mechanisms and incentives to
- conserve energy or resort to alternatives during electricity shortages. DPL'sreserves were depleted on July 6, and operators had to resort to rotating outages to 

### reduce load

- when Indian River Unit 2 (IR2) was forced out ofservice. 20. Notice requirements in load management contracts do not permit an efficient response to emergencies. DPL contracts for interruptible loads are not amenable to quickly responding to generator outages. Contracts for interruptible loads require

11

## EE-RM/STD-98-440 /3 - Reportof theDOEPowerOutageStudy Team on ElectricReliabilityEvents of the Summer of1999

-
advance notice, and, in DPL's case, they limit service interruptions to only six hours. The advanced notice requirement prevented DPL operators from shedding interruptible loads as an immediate response to the outage ofIR2. The duration limits prevented the use ofinterruptible loads in the morning hours, because these loads would then be coming back on line during the afternoon peak. 21. Reliability criteriafor generation reserves were not sufficient to avoid regular power shortfalls. DPL planning was based on meeting the load associated with the average high summer temperature. Higher-than-average peak summer temperatures, combined with depleted reserves that had resulted from prior outages, left DPL operators with no option but to shed load when IR2 failed. 

### 3.7 South-Central States 22. Summer ratings and actual capability of generating units are not always consistent. There are concerns over the determination of summer ratings in comparison with the actual capability shown on July 23. The 500 MW in small deratings is equivalent to a moderate-sized fossil unit. 23. Problems in anticipation and delays in the application of public appeals limited the effectiveness ofthe appeals once they were made. Public appeals for conservation have a limited, temporary effect. Public appeals are most effective when issued with sufficient anticipation. Considering the event ofJuly 23, dayahead public appeals were not issued because atthe time it was thought that reserves would be adequate. Eventually, public appeals were issued prior to the rotating blackouts. Entergy's lack ofrelative familiarity with the public appeals process was also a constraining factor on the system. Because Entergy had issued only two public conservation notices in the previous 20 years, comprehensive mitigation strategies were not in place, forcing a series ofmeetings that eventually led to a noon public notice for conservation. 24. Reliance on nonfirm purchases to meet operating reserve targets results in inadequate reserves duringregionwide events of high demand. Entergy calculated its reserves as a combination ofown capacity, firm and nonfirm interchange transactions, and load management. Relying on other members ofa reserve-sharing agreement for reserves saves significantly on operatingreserve costs under most conditions. However, in situations like July 23, reserves are not . used in a "normal" mode. Operating reserves can be used any time the firm load is likely to be curtailed. Under conditions ofhigh demand, the probability offirm load curtailment is consequently higherbecause more members ofthe reserve-sharing agreement are utilizing their full capability and counting on nonfirm purchases to maintain reserve. Also, any nonfirm purchase under conditions in which power markets are approaching extreme conditions is subject to recall. This greatly increases the uncertainty in peak demand obligations. This observation is not taken into consideration in the analysis ofreserve requirements.

12

# EE-RM/STD-98~440

# 4'/**~** 

# .. Report of the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of 1999

advance notice, and, in DPL's case, they limit service interruptions to only six hours. The advanced notice requirement prevented DPL operators from shedding interruptible loads as an immediate response to the outage ofIR2. The duration limits prevented the use ofinterruptible loads in the morning hours, because these.' loads would then be coming back on line during the afternoon peak. 21. Reliability criteria for generation reserves were not sufficient to avoid regular power shortfalls. DPL planning was based on meeting the load associated with the average high summer temperature. Higher-than-average peak summer temperatures, combined with depleted reserves that had resulted from prior outages, left DPL operators with no option but to shed load when IR2 failed. 

### 3.7 South-Central States

12 .22. Summer ratings and actual capability ofgeneratingunits are not always consistent. There are concerns over the determination ofsummerratings in comparison with the actual capability shown on July 23. The 500 MW in small deratings is equivalent to a moderate-sized fossil unit. 23. Problems in anticipation and delays in the application ofpublic appeals limited the effectiveness ofthe appeals once they were made. Public appeals for conservation have a limited, temporafy effect. Public appeals are most effective' when issued with sufficient anticipation. Considering the event ofJuly 23, dayahead public appeals were not issued because at the time it was thought that reserves would be adequate. Eventually, public appeals were issuedpriorto the rotating blackouts. Entergy's lack ofrelative familiarity with the public appeals process was also a constraining factor on the system. Because Entergy had issued only two public conservation notices in the previous 20 years, comprehensive mitigation strategies were not in place, forcing a series ofm_eetings that eventually led to a noon public notice for conservation. 24. Reliance on nonfirm purchases to meet operating reserve targets results in inadequate reserves during regionwide events ofhigh demand. Entergy calculated its reserves as a combination ofown capacity, firm and nonfIrm
. interchange transactions, and load management. Relying on othermembers ofa reserve-sharing agreement for reserves saves significantly onoperating reserve costs undermost conditions. However, in situations like July 23, reserves are not used in a "normal"mode. Operating reserves can be used any time the 

### fInn load is likely to be curtailed. Under conditions ofhigh demand, the probability offirm load· curtailment is consequentlyhigherbecause more members ofthe reserve-sharing agreement are utilizing their full capability and counting on nonfrrrn purchases to maintain reserve. Also, any nonfrrrn purchase under conditions in whichpower markets are approaching extreme conditions is subject to recall. This greatly increases the uncertainty in peak demand obligations. This observation is**~ot** taken into consideration in the analysis ofreserve requirements.

### EE-RM/STD-98-440-, 

## /3 . Reportof theDOEPowerOutageStudy Team on ElectricReliabilityEvents of the Summerof1999

25. Mechanisms for short-term power sales rely on multiple, often manual telecommunications, leading to inefficient and untimely outcomes. The shorttermpower market and the steps required to enact a transaction present concerns. These problems are associated with timing. The timing during which transactions can be executed presents barriers to solving problems. Typically, forhour-ahead power, the market clears no later than one-half-hour past the hour for the next hour. In the Entergy July 23 case, this meant that information on the imminent loss of White BluffUnit 1 and the loss ofan additional 300 MW ofinterruptible power from TVA came after this point in the hour (at around 2:30 p.m.). The rules for short-term markets left Entergy unable to acquire additional short-term power until 4:00 p.m. 26. The generation infrastructureis aging. Entergy's average unit age is 35 years, while its newest unit currently on line is 20 years old. Currently, Entergy is in the process ofadding to its generation capability through a multi-billion-dollar purchasing contract. This addition will increase Entergy's generation capability by approximately 4,800 MW, but the age ofits generation capability will remain an issue forEntergy. 27. Dispatch software problems led to inefficient utilization oflimited energy resources. SPP had a major operating-reserve-sharing software problem that resulted in the inability to "clear" reserve "markets" when the program came across situations ofinsufficiency. SPP has placed a temporary "patch" into the program to stop attempting to solve an infeasible problem. SPP's solution on July 23 was to perform a series ofsmall transactions between territories to maintain the system economy. The number ofmanual transactions far outpaced what should have been done. 

### 3.8 Chicago 28. Load forecasting techniques and associated distribution planning tools failed to adequately accommodate the effects ofunusual summer weather conditions as experienced in 1999. Planning has been based on "average" weather conditions, meaning that load exceeds the design criterion approximately once in every 2 or 3 years. A criterion of 1in 10 years is more commonplace in the industry. These shortcomings were compounded by further uncertainty in predictions for individual substation load levels. ComEd has now changed to a 99°F, four-hour movingaverage peak temperature as a basis for planning... 29. Emergency preparedness and management plans did not address distribution problems. Although ComEd had an emergency plan for its bulk transmission and generation system, it lacked a comparable level ofpreparation for dealing with
. distribution system problems. The response plans that were in place for extreme, multiple distribution-level contingencies were inadequate. In particular:

' - 13
. 

### 3.8 Chicago EE-RM/STD-9S-440 

# -if-**13~~** Reportof the DOEPower Outage Study Team on ElectricReliability Events o/theSummer of 1999

25. Mechanisms for short-term power sales rely on multiple, often manual telecommunications, leading to inefficient and untimely outcomes. The shortterm power market and the steps required to enact a transaction present concerns.' These problems are associated with timing. The timing during which transactions
. canbe executed presents barriers to solving problems. Typically,for hour-ahead' power, the market clears no later than one-half-hourpast the hourfor the next hour. In the Entergy July 23 case,'this meant that information on the imminent loss of White BluffUnit 1 and the loss ofan additional 300 MW ofinterruptible power from TVA came after this point in the hour (at around 2:30 p.m.). The rules for short-term markets left Entergyunable to acquire additional short-term poweruntil 4:00 p.m. 26. The generation infrastructure is aging. Entergy's average unit age is 35 years, while its newest unit currently on line is 20 years old. Currently, Entergy is in the process ofadding to its generation capability through a multi-billion-dollar purchasing contract. This addition will increase Entergy's generation capabilityby approximately 4,800 MW, but the age ofits generation capability will remain an issue for Entergy. 27. Dispatch software problems led to inefficient utilization oflimited energy resources. SPP had a major operating-reserve-sharing software problem that resulted in the inability to "clear" reserve "markets" when the program came across situations ofinsufficiency. SPP has placed a temporary "patch" into the program to stop attempting to solve an infeasible problem. SPP's solution on July 23 was to perform a series ofsmall transactions between territories to maintain the system economy. The number ofmanual transactions far outpaced what should have been done.

.- --
28. Load forecasting techniques and associated distribution planningtools failed to adequately accommodate the effects ofunusual summer weather conditions as experienced in ll999. Planning has been based on "average"weather conditions, meaning that load exceeds the design criterion approximately once in every 2 or 3 years. A criterion of 1in 10 years is more commonplace in the industry. These shortcomings were compounded by further uncertainty in predictions for individual substation load levels. CornEd has now changed to a 99°F, four-hour movingaverage peaktemperature as a basis for planning.
. 29. Emergency preparedness and management plans did not address distribution problems. Although CornEd had an emergency plan for its bulktransmission and generation system, it lacked a comparable level ofpreparation for· dealing with distribution system problems. The response plans that were in place for extreme, mUltiple distribution-level contingencies were inadequate. In particular:

13 ..**:..~** .,.

-, ".' -",,' .

### EE-RM/STD-98-440 - /_,0
Report of the DOEPowerOutageStudy Team on ElectricReliabilityEvents of the Summer of 1999


### * Detailed distribution level load reliefand emergency load interruption.
.. procedures were incomplete; : * Under emergency conditions, information flows between the utility and 

### organizations affected by outages were perceived as inadequate by these organizations; and 

### * ComEd's planning process has no measure (ormetric) for assessing the risk of multiple contingencies. 30. The distribution system topology is inflexible. The topology ofthe urban distribution system lacked flexibility. In particular, its ability to shift load between substations under contingencyconditions was inadequate. The use ofYjoints in 

### cables made it more difficult to locate a fault and increased the effects ofcable :: faults. Inconsistent protection philosophies tended to increase the duration ofthe outages. 31. Substation protection and equipment configuration practices limited flexibility. Some substation protection and equipment configuration practices also limited flexibility in emergency response situations (which, when coupled with existing equipment protection schemes, could force removal ofboth a failed transformer and a working transformer paired with it). 32. Planned distributionsystem upgrades were not implemented on schedule. Distribution system upgrades in progress were not completed in time for the summer peak (e.g., an in-progress 69-kV to 138-kV substation transformer upgrade). 33. Real-time information and historical records on distributionsystem conditions were limited and were not always preserved. Less than full penetration of supervisory control and data acquisition (SCADA) system technology hindered complete monitoring ofdistribution system overload conditions. Each ofthe highvoltage substations (Northwest, Lakeview, and Jefferson) has SCADA. Most ofthe 4-kV portions ofthe distribution system that were interrupted as a result ofthe 12-kV cable failures do not have SCADA. Selection of SCADA data for long-term "warehousing" excluded certain key measurements, such as feeder overloads, which impeded the study ofreliability trends. Also, the computer system that records alarms overloaded and lost information that was needed to analyze the outage chronology. (This problem was corrected in the aftermath ofthe summer outages.) 34. Maintenance planning did not consider transformer overload analysis. Transformer overload analysis and reporting tools were generally not coordinated with maintenance planning and programs. 35. Substation maintenance programs did not anticipate component weaknesses. Many fixed, periodic, substation maintenance programs had been scaled back or



### 14 

### EE-RM/STD-98-440
-

# tt:--/3**~** Report of the DOEPower Outage Study Team on Electric ReliabilityEvents of the Summer of J 999



### 30.

3l.

32.



### 33.

34.

35.

14 • Detailed distribution level load reliefand emergency load interruption procedures were incomplete;

-
• Under emergency conditions, information flows between the utility and organizations affected by outages were perceived as inadequate by these organizations; and

• CornEd's planning process has no measure (ormetric) for assessing the risk of multiple contingencies. The distribution system topology is inflexible. The topology ofthe urban distribution system lacked flexibility. In particular, its ability to shift load between substations under contingency conditions was inadequate. The use ofYjoints in cables made it more difficult to locate a fault and increased the effects ofcable :,. faults. Inconsistent protection philosophies tended to increase the duration ofthe outages. Substation protection and equipment configuration practices limited flexibility. Some substation protection and equipment configuration practices also limited flexibility in emergency response situations (which, when coupled with existing equipment protection schemes, could force removal ofboth a failed transformer and a working transformerpaired with it). Planned distribution system upgrades were not implemented on schedule. Distribution system upgrades in progress were not completed in time for the
. summer peak (e.g., an in-progress 69-kV to 138-kV substation transformer upgrade). Real-time information and historical records on distribution system conditions were limited and were not always preserved. Less than full penetration of
. supervisory control and data acquisition (SCADA) system technology hindered complete monitoring ofdistribution system overload conditions. Each ofthe highvoltage substations (Northwest, Lakeview, and Jefferson) has SCADA. Most ofthe 4-kV portions ofthe distribution system that were interrupted as a result ofthe 12-kV cable failures do not have SCADA. Selection ofSCADA data for long-term "warehousing" excluded certain key measurements, such as feeder over1oads, which impeded the study ofreliability trends. A1so, the computer system that records alarms overloaded and lost information that was needed to analyze the outage chronology. (This problem was corrected in the aftermath ofthe summer outages.). Maintenance planning did not consider transformer overload'analysis. Transformer overload analysis and reporting tools were generally not coordmated with maintenance planning andprograms.

-.. Substation maintenance programs did not anticipate component weaknesses. Many fixeq, periodic, substation maintenance programs had been scaledback or '-".-

'.-

## EE-RM/STD-98-440- /32.
ReportoftheDOEPowerOutageStud) Team onElectricReliabilityEvents of the Summer of1999

discontinued in transition to a "reliability-centered maintenance"-philosophy. However, the collection ofdata and measurements necessary for successful

_ reliability-centered maintenance was not fully in place (e.g., the dissolved gas analysis ofoil-filled cables used to detect internal degradation and incipient failure began only in the aftermath ofthe summer outages). In general, the ability to predict possible component failures from the inspections that were performed and data that were collected was limited. 36. Maintenance management contributed to the severity ofthe outages. Management ofmaintenance activities was weak; tracking ofinspection and maintenance processes was incomplete and poor; and employee training and skill levels were inappropriately matched to inspection duties (as documented in the case ofaerial inspection oftransmission conductors and insulators). A large backlog of desired corrective and preventive maintenance activities had accumulated inthe year preceding the outages. 37. Transmission and distributionmaintenance expenditures declined over time and became inadequate. T&D maintenance expenditures declined dramatically and consistently from 1991 to 1998. The decline coincided with other cost pressures faced by ComEd, including those associated with nuclear plant maintenance and industry restructuring. 38. Several business factors compromised reliability performance. While many individual "pieces" ofreliability activity were in place (e.g., ComEd's participation in ajoint Electric Power Research Institute (EPRI)-led project on reliability data mining), overall reliability performance was compromised by inadequate links . between new business strategies (such as reliability-centered maintenance), resource allocation, employee training and supervision, and reliability-relevant data collection and analysis tools currently used in the field.

15 

### EE-RM/STD-98-440

# 4- (3e:Z,
Report of the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of 1999

discontinued in transition to a "reliability-centered maintenance".philosophy. However, the collection ofdata and measurements necessary for successful
. reliability-centered maintenance was not fully in place (e.g., the dissolved gas analysis ofoil-filled cables .used to detect internal degradation and incipient failure began only in the aftermath ofthe summer outages). In general, the ability to predict possible component failures from the inspections that were performed and data that were collected was limited. 36. Maintenance management contributedto the severity ofthe outages. Management ofmaintenance activities was weak; tracking ofinspection and maintenance processes was incomplete and poor; and employee training and skill levels were inappropriately matched to inspection duties (as documented in the case ofaerial inspection oftransmission conductors and insulators). A large backlog of desired corrective and preventive maintenance activities had accumulated in:the yearpreceding the outages. 37. Transmission and distribution maintenance expenditures declined over time and became inadequate. T&D maintenance expenditures declined dramatically and consistently from 1991 to 1998. The decline coincided with other cost pressures faced by CornEd, including those associated with nuclearplant maintenance and industry restructuring. 38. Several business factors compromised reliability performance. While many individual "pieces" ofreliability activity were in place (e.g., CornEd's participation in ajointElectric Power Research Institute (EPRI)-led project on reliability data mining), overall reliability performance was compromised by inadequate links
. between new business strategies (such as reliability-centered maintenance), resource allocation, employee training and supervision, and reliability-relevant data collection and analysis tools currently used in the field.

1$ '" .

## EE-RM/STD-98-440 -- 3 O. 

# Section 4 Process for Soliciting Public Input
Following release ofthe Interim Report on January 4, 2000, POST conducted three technical workshops at which the team heard public comments and recommendations on appropriate actions that the federal government could take to address the findings described in Section 3ofthis report. The workshops listed below were organized around the five topics used in the Interim Report to group the findings4

### : * January 20, 2000: San Francisco, California

- Transition to Competitive Energy Service Markets

- Regulatory Policy for Reliable Transmission and Distribution * January 24, 2000: New Orleans, Louisiana - Information Resources



### - Operations Management andEmergency Response * January 27, 2000: Newark, New Jersey -Reliability Metrics, Planning, and Tracking The workshops were well attended, with more than 150 individuals participating in one or more ofthe sessions. Attendance reflected abroad cross-section ofstakeholders in today's electricity industry, including utilities, ISOs, marketers,union representatives, state regulators, local officials, NERC, trade associations, consumer advocates, EPRI, equipment vendors, and industry consultants. The team also received more than 70 written comments through its web site, by mail, and by fax. Appendix A contains an integrated summary ofthe input received at the technical workshops and via the web site, by mail, and by fax. POST has found the technical workshops and public comment process to be an invaluable source ofinput for the development ofits recommendations. Around the country, POST observed a deep interest in reliability. In developing its recommendations, the team relied on these comments to supplement and enhance its own analysis and expertise.

4 

### Each workshop also provided opportunities for public comment on any ofthe other findings and topic areas.
16 

### EE-RM/STO-9S-440-# 

# /3C:Z Section 4 

# Process for Soliciting Public Input

16 Followingrelease ofthe Interim Report on January4,2000, POST conducted three technical workshops at which the team heard public comments andrecommendations on appropriate actions that the federal government could take to address the findings described in Section 3 ofthis report. The workshops listed below were organized around the five topics used in the Interim Report to group the findings4:

• January 20, 2000: San Francisco, California

- Transition to Competitive Energy Service Markets

- Regulatory Policy for Reliable Transmission and Distribution

• January 24, 2000: New Orleans, Louisiana

- Information Resources

- Operations Management and Emergency Response

• January 27, 2000: Newark, New Jersey

- ReliabilityMetrics, Planning, and Tracking The workshops were well attended, with more than 150 individuals participating in one ormore ofthe sessions. Attendance reflected a broad cross-section ofstakeholders in today's electricity industry, includingutilities, ISOs, 

### marketers, union representatives, state regulators, local officials, NERC, trade associations, consumer advocates, EPRI,
. equipment vendors, and industry consultants. The team also received more than
. 70 written comments through its web site, by mail, and by fax. Appendix A contains an integrated summary ofthe input received at the technical workshops and via the web site, by mail, and by fax. POST has found the technical workshops and public comment process to be an invaluable source ofinput for the development ofits recommendations. Around the country, POST observed a deep interest in reliability. Indeveloping its recommendations, the team relied on these comments to supplement and enhance its own analysis and expertise.

4 Each workshop also provided opportunities for public comment on any ofthe other findings and topic areas.

## EE-RM/STD-98-440 --S / 

## 3 

# Section 5 

# Recommendations tothe Secretary of Energy -
The U.S. electric industry is in a state oftransition. Formerly full-service utilities are divesting, merging, and reorganizing in an effort to maximize their opportunities in a restructured industry. New market entrants are seeking to expand their presence within the industry, and new institutions are emerging to operate the grid. It is uncertain what the industry will look like following restructuring or the time frame in which it will be realized. What is certain is that ensuring reliable electric service will be an essential requirement throughout. The POST members recognize that . : adequately balancing public interest in reliability with its associated costs will be an ongoing challenge. Therecommendations offered to the Secretary ofEnergy in this report are based on the findings developed by POST following its study ofsignificant reliability events from the summer of 1999. Some recommendations support ongoing federal programs. Others address areas ofnew or increased federal involvement. These recommendations for federal actions on reliability are not intended to be all inclusive. Some aspects of reliability are beyond the scope ofthis report. POST'srecommendations reflect the basic premise that, while markets and-industry :- should address issues related to reliability, the federal government has a fundamental .- responsibility for ensuring that the public's interests are fully represented. Moreover, many stakeholders, including state and local governments, share this responsibility. Systems developed by the industry have evolved toprotect electric reliability; however, these systems need tobe overhauled to address the needs ofa changing industry. Nevertheless, they are the appropriate starting points for any required changes. For example, POST recommends that the federal government support management ofelectric grids by a self-regulating reliability organization that has federal oversight to make compliance with reliability standards mandatory. Further, POST recommends increased federal leadership in selected areas, such as comprehensive restructuring legislation, reliability-enhancing activities by federal utilities, and facilitating regional solutions for siting. The team recognizes that federal leadership in these areas may be controversial but maintains that leadership is essential for ensuring reliability. It is important to recognize that electric reliability and efficient electricity markets are inextricably intertwined. Just as markets cannot be designed without considering reliability, the mechanisms for reliability in a competitive market cannot be effectively implemented without a clear understanding ofhow markets will work. As we move toward regional, and even national, electricity markets, regional and national solutions

- forreliability ofthe bulk-power systemmust be considered. In the interest ofreliability,
17**'~** .

## E~.RM/STD.98.440

# -#-**13~** 

# Section 5 Recommendations 

# to the

. " 

# Secretary of

# Energy-::- ' ..-

The U.S. electric industry is in a state oftransition. Fonnerly full-service utilities are divesting, merging, and reorganizing in an effort to maximize their opportunities in a restructured industry. New market entrants are seeking to expand their presence within the industry, and new institutions are emerging to operate the grid Itis uncertain what the industry will look like following restructuring or the time frame in which it will be realized. What is certain is that ensuring reliable electric service will be an essential requirement throughout. The POST members recognize that adequately balancing public interest in reliability with its associated costs will be ail ongoing-challenge. The recommendations offered to the Secretary ofEnergy in this report are based on the findings developed by POST following its study ofsignificant reliability events from the summer of 1999. Some recommendations support ongoing federal programs. Othersaddress areas ofnew or increased federal involvement:These recommendations for federal actions on reliability are not intended to be all inclusive. Some aspects of
_ reliability are beyond the scope ofthis report. POST'srecommendations reflect the basic premise that, while markets and industry should address issues related to reliability, the federal government has a fundamental

- responsibility for ensuring that the public's interests are fully represented. Moreover, many stakeholders, including state and local governments, share this responsibility. Systems developed bythe industryhave evolved to protect electricreliability; however, these systems need to be overhauled to address the needs ofa changing industry.

- Nevertheless, they are the appropriate starting points for any required changes. For

example, POST recommends that the federal government support management ofelectric grids by a self-regulating reliability organization that has federal oversight to make compliance with reliability standards mandatory. Further, POST recommends increased federal leadership in selected areas, such as comprehensive restructuring legislation, reliability-enhancing activities by federal utilities, and facilitating regional solutions for siting. The team recognizes that federal leadership in these areas may be controversial but maintains that leadership is essential for ensuring reliability.

- Itis important to recognize that electric reliability and efficient elec_tricity markets' are inextricably intertwined. Just as markets cannot be designed without considering reliability, the mechanisms for reliability in a competitive market cannotbe effectively -' implemented without a clearunderstanding ofhow markets will work. As we move - toward regional, and even national, electricity markets, regional and national solutionsfor reliability ofthe bulk-power systemmust be considered. In the interest ofreliability,

-
.17 .. ' .- -**~**

..:",

-

## EE-RM/STD-98-440- /3 

# ; 

# :
Reportof theDOEPowerOutageStudy Team on ElectricReliabilityEvents of the Summer of1999 - -. -

it is imperative that a comprehensive, not a piecemeal, approach be taken, while, atthe : same time, respecting traditional state roles. POST also recommends enhancing federal activities in areas where federal roles are already well established, such as in facilitating exchanges ofinformation, conducting public interest R&D, and monitoring reliability issues. The team has identified several areas where increased federal support for these activities is especially warranted at this time. The POST prefaces these actions by noting that effectiveness will be maximized by undertaking them in close partnership with industry stakeholders. In this report, POST submits twelve recommendations for consideration by the Secretary ofEnergy. The following recommendations are designed to help avoid future power outages. One or more possible federal actions are suggested along with each recommendation. Following each recommendation are numbers that correlate to the findings in Section 3. Table 2 also lists the recommendations and their associated findings (at the end ofthis section). 1. Promote market-based approaches to ensure reliable electric services. (addresses Findings 1-3, 10, 12, 19, and 37) Restructuring is based on the fundamental principle that competition and markets, not regulators and utilities, result in better investment and operating decisions with respect to generation and consumption ofelectricity. Mechanisms that will ensure adequate supplies ofelectricity

- and reliable operations

- should be designed with this principle in mind. The value ofreliability needs to be determined in competitive markets, and customers, as well as energy providers, need to have the opportunity to participate in markets for energy and ancillary services - and profit from that participation. Yet, because electric service is provided through a network, it has aspects ofa public good and may be underprovided byprivate entities. Guidance is needed to ensure that the public interest is adequately captured. Many states have made significant progress in developing competitive electricity markets. However, efforts in developing market-based mechanisms for promoting electric reliability

- for example, allowing customers to participate in energy and ancillary service markets - have been less aggressive. Developers ofthese mechanisms must explicitly account for the broad geographic scope oftoday's electricity markets, which can extend across multiple states and regions ofthe country. 5 Although states have a definite role in regulating utilities and protecting consumers, there is also an important federal role: to improve the operation ofpower markets by providing leadership, direction, and consistency across the country.

5 The U.S. electric power system consists ofjustthree distinct interconnections; trade can be.

conducted throughout an interconnection. For example, agenerator in Minnesota can sell to a customer in Florida.



### 18 - '. 

### EE-RM/STD-98-440 -

# # J:3**~**

# .'

Report of the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of 1999

18 itis imperative that a comprehensive, not a piecemeal,approachbe taken, while, at1he
. same time, respecting traditional state roles.
. POST also recommends enhancing federal activities in areas where federal roles are . alreadywell established, such as in facilitating exchanges ofinformation, conducting
. public interest R&D, and monitoring reliability issues. The team has identified several
. areas where increased federal support for these activities is especially warranted at this time. The POST prefaces these actions bynoting that effectiveness will be maximized by undertaking them in close partnership with industry stakeholders. Inthis report, POST submits twelve recommendations for consideration by the Secretary ofEnergy. The following recommendations are designed to help avoid future poweroutages. One or more possible federal actions are suggested along with each recommendation. Following each recommendation are numbers that correlate to the. fmdings in Section 3. Table 2 also lists the recommendations and their associated' fmdings (at the end ofthis section). 

### 1. Promote market-based approaches to ensure reliable electric services,. (addresses Findings 1-3, 10, 12, 19, and 37) Restructuring is based onthe fundamental principle that competition and markets, not regulators and utilities, result in betterinvestment and operating decisions with
. respect to generation and consumption ofelectricity. Mechanisms that will ensure adequate supplies ofelectricity

- and reliable operations

- shouldbe designed with this principle in mind. The value ofreliability needs to be determined in competitive markets, and customers, as well as energy providers, need to have the opportunity

### to participate in markets for energy and ancillary services

- and profit from that
. participation. Yet, because electric service is provided through a network, it has aspects ofa public good and may be underprovided by private entities. Guidance is ne'eded 

### to.. ensure that the public interest is adequately captured. Many states have made significant progress in developing competitive electricity
. markets. However, efforts'in developing market-based mechanisms for promoting

- electric reliability

- for example, allowing customers to participate in energy and ancillary service markets

- have been less aggressive. Developers ofthese mechanisms
. must explicitly account for the broad geographic scope oftoday's elec'tricity markets, which can extend across multiple states and regions ofthe country.5 Although states have a definite role in regulating utilities and protecting consumers, there is also an important _" federal role: to improve the operation ofpower markets byproviding leadership, direction, and consistency across the country.

5 The U.S. electric power system consists of justthree distinct interconnections; trade can be
. conducted throughout an interconnection. For example, a generator in Minnesota can sell 

### to a customer in Florida.

### EE-RM/STD-98-440- + 

### /2-
- ReportoftheDOEPowerOutageStudy Team on ElectricReliabilityEvents of the Summer of1999

Actionfor federalconsideration: Supportthe implementationoffair, efficient, andtransparent markets for electric powerandancillary services. Depending on markets to ensure reliability requires well-functioning exchange forums. Energy and ancillary services should be defined uniformly so that performance or delivery can be verified easily. Standard contract terms and conditions are needed to clarify obligations and responsibilities. Prices for energy and ancillary services should be widely available so that buyers and sellers can make informed decisions. ISOs and system operators should be encouraged to make real-time market prices and information on system conditions widely available. Finally, prices should accurately reflect supply and demand. Mechanisms to monitor and curtail abuses ofmarket power must be enhanced. The federal government should ensure that these threshold conditions are met by efforts to create and implement markets for electric services around the country. 2. Enable customer participationin competitive electricity markets. (addresses Findings 1,2, 10, 19, and 20) The ability ofcustomers to manage their demand in response to market prices is the key to ensuring both reliable electric service and an efficiently functioning, competitive electricity market. POST agrees with public comments received that meaningful customer participation is a prerequisite for achieving the full reliability benefits of restructuring. To more fully participate in a competitive market, customers must be able to see real-time prices (ifthey choose to do so) and have access to the communication and control technologies that will enable them to participate directly. Actionsfor federal consideration: Supportthe development of marketrules thatallowcustomers tosupply load reductionsandancillaryservices in competitive energymarkets. The market rules for competitive energy markets evolved from rules used to govern operations and energy transactions involving large generating units. It is not surprising that many rules assume that generating technologies will provide energy and ancillary services. Functional, rather than technology-dependent, specifications are needed fordelivering energy and providing ancillary services so that customers can participate. The federal government should support the development and adoption ofmarket rules that ensure reliability by providing for broad and meaningful customer participation in competitive markets for energy and ancillary services. *Encouragedevelopmentof demand managementsystems thatsupportelectric
.. reliability. Price visibility is an important prerequisite for efficient markets. For customers to participate in markets for energy and ancillary services, price visibility must be coupled

19 

### EE-RM/STD-98-440

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# 3"~

# " "."
Reporta/theDOEPower Outage Study Team on Electric ReliabilityEvents a/theSummer0/1999

Action for federal consideration: Support the implementation oj Jair, efficient, andtransparent marketsJor electricpowerandancillaryservices. Depending on markets to ensure reliability requires well-functioning exchange forums. Energy and ancillary services should be defined unifonnly so thatperformance or delivery can be verified easily. Standard contract terms and conditions are needed to clarify obligations and responsibilities. Prices for energy and ancillary services should be widely available so that buyers and sellers can make informed decisions. ISOs and system operators" should be encouraged to make real-time market prices and information on system conditions widely available. Finally, prices should accurately reflect supply and demand. Mechanisms to monitor and curtail abuses ofmarket powermust be enhanced. The federal government should ensure that these threshold conditions are met by efforts to create and implement markets for electric services around the country. 

### 2. Enable customer participation in competitive electricity markets. (addresses Findings 1,2,10,19, and 20) The ability ofcustomers to manage their demand in response to market prices is the key to ensuring both reliable electric service and an efficiently functioning, competitive electricity market. POST agrees with public comments received that meaningful customerparticipation is a prerequisite for achievingthe full reliabilitybenefits of restructuring. To more fully participate in a competitive market, customers must be able to see real-time prices (ifthey choose to do so) and have access to the communication" and control technologies that will enable them to participate directly. Actions for federal consideration:

• Support the development ojmarket rules that allow customers to supply load reductions andancillaryservices in competitive energymarkets. The market rules for competitive energy markets evolved from rules used to govern operations and energy transactions involving large generating units.**I~** is not surprising that many"rules assume that generating technologies will provide energy and ancillary services. Functional, rather than technology-dependent, specifications are needed for" " delivering energy and providing ancillary services so that customers can participate. The federal government should support the development and adoption ofmarket rules that ensure reliability byproviding for broad and meaningful customerparticipation 

### in competitive markets for energy and ancillary services. "

• Encourage development oj demand managementsystemS that support electric" " reliability. Price visibility is an important prerequisite for efficient markets. Forcustomers to participate in markets for energy and ancillary services, price visibility mustbe coupled

19

### EE-RM/STD-98-440 -ff 

### /5BP Reportof theDOEPowerOutageStudy Team on ElectricReliabilityEvents ofthe Summerof1999 '


### with communication and control technologies that enable customers to receive, interpret, and respond to prices. The federal government should support the development and demonstration ofdemand management technologies, systems, and approaches that will allow customers to participate in competitive energy markets. 3. Remove barriersto distributedenergy resources. (addresses Findings 1,2, 10, and 19) There is currently great interest in relying more heavily on distributed generation technologies tohelp utilities respond more rapidly to an increased demand for electricity in areas where demand is already high. At the same time, utilities are striving to improve the quality ofpower to customers. Many argue that barriers impede market-driven acceptance ofthese technologies. The federal government should target this area for special attention and review and remove these barriers, as needed. Actionsfor federalconsideration: Supportthe development ofinterconnectionstandards fordistributedenergy resources. 

### Interconnection practices for distributed energy resources vary widely across the country. Greater uniformity in these practices should lower installation and operating costs, without diminishing the importance ofworker safety, system reliability, and customer protection needs. Industry-led forums, such as those sponsored by the Institute ofElectrical andElectronics Engineers, are leading the way in developing a consensus on this subject, largely due to support from DOE. The federal government should continue these efforts - and enhance their effectiveness

- by encouraging local jurisdictions to adopt them and by promoting the development oftesting and verification procedures. *Supportstate-ledefforts to address regulatorydisincentives for integrating customersupply anddemandsolutions. 

### Current ratemaking practices are disincentives for distributed resources. In many jurisdictions, reduction ofload (through either customer-owned distributed generation or other load-reduction technologies) may be profitable to utility distribution companies only during periods ofpeak demand. From a customer's perspective, however, investments in these technologies may have an economic value. During periods ofpeak demand, load reduction could improve reliability by reducing demand on stressed electric systems. The federal government should support state efforts to identify and address mismatches between traditional ratemaking approaches and public policies appropriate forreliability-enhancing distributed energy resources in a restructured electric industry.

20 

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Report of the DOEPower Outage Study Team on Electric Reliability Events of the Summer of 1999



### 20 with communication and control technologies that enable customers to receive,interpret,
. and respond to prices. The federal government should support the development and demonstration ofdemand managementtechnologies, systems, and approaches that will
.. .' I allow customers to participate in competitive energy markets. 

### 3. Remove barriers to distributed energy resources. (addresses Findings 1,2,10, and 19) There is currently !,'Teat interest in relying more heavily on distributed generation technologies to help utilities respond more rapidly to an increased demand for electricity in areas where demand is already high. At the same time, utilities are striving to improve the quality ofpower to customers. Many argue that barriers impede market-driven acceptance ofthese technologies. The federal government should target this area for special attention and review and remove these barriers, as needed. Actions for federal consideration: Support the development ojinterconnection standardsJor distributed energy resources. Interconnection practices for distributed energy resources vary widely across the country. Greateruniformity in these practices should lower installation and operating costs, without diminishing the importance ofworker safety, system reliability, and customerprotection needs. Industry-led forums, such as those sponsoredby the Institute ofElectrical and Electronics Engineers, are leading the way in·developing a consensus on this subject, largely due to support from DOE. The federal goveminent should continue these efforts

- and enhance their effectiveness

- byencouraging local jurisdictions to adopt them and by promoting the development oftesting and verification procedures.

• Supportstate-lede.JJorts to address regulatory disincentivesJor integrating customer**supp~y** anddemandsolutions. Currentratemaking practices are disincentives for distributed reliources. Inmany jurisdictions, reduction ofload (through either customer-owned distributed generation

### m other load-reduction technologies) may be profitable to utility distribution companies. only during periods ofpeak demand. From a customer's perspective, however, investments in these technologies may have an economic value. Duringperiods ofpeak demand, load reduction could improve reliability by reducing demand on stressed electric systems. The federal government should support state efforts to identify and address mismatches between traditional ratemaking approaches and public policies
. appropriate for reliability-enhancing distributed energy resources in a restructured electric industry.

## EE-RM/STD-98-440-4t /± 3
Reportof theDOEPowerOutageStudy Team on ElectricReliabilityEvents ofthe Summer of1999 ' 

### Study thepotentialfor usingemergency backupgeneratorsto reducesystem -: :. demands tohelpavoid poweroutages. A large installed base ofemergency backup generation exists that is currently deployed only after actual power outages. Operating these generators in advance of system emergencies can reduce stress on a system and possibly avoid outages. However, operating these generators to avoid outages is complicated because ofthe lack of incentives for backup generation owners; the need for demonstrations ofcommunication, control, and system protection technologies; and current environmental restrictions. The federal government should study these issues and, where appropriate, take actions to remove barriers to the use ofbackup generation to enhance system reliability. 4. Support mandatory reliability standardsfor bulk-power systems. (addresses Findings 4, 11, 21, 24, and 36-38) Today, the interconnected electric power system is being transformed from one that was primarily designed to serve the customers offull-service utilities, each integrated across the generation, transmission, and distribution functions, to one that will support a vibrant, competitive market. This change makes the current system ofvoluntary compliance with reliability standards inadequate for ensuring reliability. Mandatory standards for bulk-power systems are needed to ensure that the "rules ofthe road" are implemented in a straightforward and balanced manner. 

### Actionfor federal consideration: Supportthe creationof aself-regulatedreliabilityorganization with federal oversightto developandenforce reliability standards forbulk-powersystems as part of a comprehensive plan forrestructuring the electric industry. Industry-led voluntary reliability standards for bulk-power system operation and planning have worked effectively since their inception. These efforts are the logical and appropriate starting point to change from voluntary to mandatory standards. The federal government should continue its support for this evolutionary process by authorizing the creation of a self-regulated reliability organization with federal oversight to ensure compliance with reliability standards. However, this effort should not be undertaken in isolation. It must be treated as an integral element ofa comprehensive plan for restructuring the industry. A piecemeal approach that treats reliability in isolation would compromise reforms needed in other arenas linked to reliability (e.g., more efficient markets, regional operations ofgrids). 5. Support reporting and sharing of information on "best practices." (addresses Findings 5-9, 11, 15-18, 21, 22, 24, 27, and 29-38) Many forums for exchanging information on "best practices" formaintaining and operating electric generation, transmission, and distribution systems already exist. However, concerns exist about the consistency ofsome information (such as reliability

21 

### EE-RM/STD-98-440

# --tt: 

# /3;;z.

Report ojthe DOEPower Outage Study Team on Electric ReliabilityEvents ojthe Summer oj1999 _, Study thepotentialJor usingemergency backupgenerators to reduce syste11l - __ demands to help avoidpoweroutages. A large instaIJed base ofemergencybackup generation exists thatis currently deployed only after actual power outages. Operating these generators in advance of systememergencies can reduce stress on a system and possibly avoid outages. However, operating these generators to avoid outages is complicatedbecause ofthe lack of incentives for backup generation owners; the need for demonstrations ofcommunication, control, and systemprotection technologies; and current environmental restrictions. The federal government should study these issues and, where appropriate, take actions to remove barriers to the use ofbackup generation to enhance system reliability. 

### 4. Support mandatory reliability standards for bulk-power systems. (addresses Findings 

### 4, 11,21,24, and 

### 36-38) Today, the interconnected electric power system is being transformed from one that was primarily designed to serve the customers offuIJ-service utilities, each integrated across the generation, transmission, and distribution functions, to one that will support a vibrant, competitive market. This change makes the current system ofvoluntary compliance with reliability standards inadequate for ensuring reliability. Mandatory standards for bulk-power systems are needed to ensure that the "rules ofthe road" are implemented in a straightforward and balanced manner. 

### Action for federal consideration: Support the creation oj a selJ-regulated reliability organization withJederal oversight to develop andenforce reliability standards for bulk-powersystems**~** part of a comprehensiveplanJor restructuring the electric industry.

- Industry-led voluntary reliability standards for bulk-power system operation and plmming have worked effectively since their inception. These efforts are the logical and appropriate starting point to change from voluntary to mandatory standards. The federal government should continue its support for this evolutionary process by authorizing the creation ofa self-regulated reliability organization with federal oversight to ensure , compliance with reliability standards. However, this effort shouldnot be undertaken in isolation. It must be treated as an integral element ofa comprehensive plan for-
_ restructuring the industry. A piecemeal approach that treats reliability in isolation would compromise reforms needed in other arenas linked to reliability (e.g., more efficient markets, regional operations ofgrids). 

### 5. Support reporting and sharing ofinformation on "bestpractices." (addresses Findings 

### 5-9,11,15-18,21,22,24,27, and 

### 29-38) Many forums for exchanging information on "best practices" for maintaining-

### and operating electric generation, transmission, and distribution systems already exist. However, concerns exist about the consistency ofsome information (such as reliability

21

# EE-RM/STD-98-440 - 

# /3:-
Report of the DOE PowerOutageStudy Team on ElectricReliabilityEventsofthe Summerof1999.
. 

### indices), the availability ofdata to all industry stakeholders, and the continued viability ofthese forums in a restructured industry. The federal government could play an important role in enhancing the definition, collection, and sharing ofinformation. It should work in close partnership with states and other industry stakeholders as it develops this role. Actions for federalconsideration: Promote the use ofuniform definitionsandmeasurements forreliability-related information. 

### Industry-led groups have developed a number ofmeasurements for reliability. As reliability becomes more ofa commodity that customers can select and pay for, increased uniformity in definitions and measurements is needed, and newmeasures ofreliability should be developed. The federal government should promote these efforts. *Facilitatethe collection andsharing ofinformationon reliability-related regulatoryissues amongstate public utilitycommissions. 

### Oversight and regulation ofdistribution system reliability are state responsibilities. Among many other things, restructuring is requiring state public utility commissions (PUCs) to re-examine, and, where appropriate, modify policies for reliability. The effectiveness ofthese state-led activities is enhanced by information sharing among these ' commissions. The federal government should support these activities by working with national organizations, such as the National Association ofRegulatory Utility Commissioners, to facilitate the collection and sharing ofinformation on comparative utility reliability performance, service reliability standards, and regulatory policies and incentives for reliability. Information onreliability policies in other countries, where, for example, utilities are penalized and customers are compensated for outages, may be especially helpful. Similarly, better information on the value customers place on (and their willingness and ability topay for) reliability should be especially helpful in establishing future regulatory policies for reliability. * Support activitiesto developandshare informationamong industryparticipants on criticalresourcesandindustry practices. 

### In response to concerns that information sharing among utilities may become a - greater concern because ofrestructuring the industry, the federal government should begin to assess existing forums for information exchange and, ifnecessary, examine ways to enhance them or develop complementary forums. Information on the availability ofcritical T&D equipment and onbest practices for distribution system maintenance should be considered first. Electronic media, such as web sites, should be considered as possible forums for facilitating these exchanges.
.

22 

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# /3~.·· Report of the DOEPower Outage Study Team on ElectricReliability Events of the Summer of 1999.



### 22 indices), the availability ofdata to all industry stakeholders, and the continue.d viability
.. ofthese forums in a restructured industry. The federal government couldplay an important role in enhancing the definition, collection, and sharingofinfonnation. It should work in close partnership with states and other industry stakeholders as it develops this role. Actions for federal consideration:

• Promote the use of uniform definitions andmeasurements for reliability-related information. Industry-led groups have developed a number ofmeasurements for reliability. As reliability becomes more ofa commodity that customers can select and pay for, increased unifonnity in definitions and measurements is needed, and newmeasures ofreliability
. should be developed. The federal government shouldpromote these efforts.

• Facilitate the collection andsharingof information on reliability-related regulatory issues amongstatepublic utility commissions. Oversight and regulation ofdistribution system reliability are state responsibilities. Among many other things, restructuring is requiring state public utility commissions (PUCs) to re-examine, and, where appropriate, modify policies for reliability. The
. effectiveness ofthese state-led activities is enhanced by information sharing among these·
. commissions. The federal government should support these activities by working with national organizations, such as the National Association ofRegulatory Utility Commissioners, to facilitate the collection and sharing ofinformation on comparative· utility reliability perfonnance, service reliability standards, and regulatory policies and incentives for reliability. Infonnation on reliability policies in other countries, where, for example, utilities are penalized and customers are compensated for outages, maybe especially helpful. Similarly, better infonnation on the value customers place on (and their willingness and ability to pay for) reliability should be especially helpful in establishing future regulatory policies for reliability.
.
• Support activities to develop andshare information among industryparticipants on critical resources andindustrypractices. In response to concerns that information sharing among utilities maybecome a greater concern because ofrestructuring the industry, the federal government should begin to assess existing forums for information exchange and, ifnecessary, examine ways to**e~ance** them ordevelop complementary forums. Information on the availability ofcritical T&D equipment and on best practices for distribution Systemmaintenance should be considered first. Electronic media, such as web sites, shouldbe considered as'
. possible forums for facilitating these exchanges. '. :;:

## EE-RM/STD-98-44q 

# 04 /37
ReportoftheDOEPowerOutageStudy Team on ElectricReliabilityEvents of theSummer of1999

6. Enhance emergency preparedness activities for low-probability, high-consequence events on bulk-power systems. (addresses Findings 3, 4, 9, 20, 23, and 29) Emergencies on bulk-power systems affect large geographic areas, involve many stakeholders, and affect millions ofcustomers. The events ofthe summer of 1999 demonstrated that effective communication and coordination among many parties are critical during times of system emergencies. The federal government should actively support efforts to continually review and improve planning and response capabilities. Action forfederalconsideration:

Work with regional, state,andlocalauthoritiesto supportcontinuous improvement in coordination, planning, and preparations to respondto .. : electricity emergencies. A critical element ofemergency preparedness by industry participants is coordination with and among federal, regional, state, and local authorities. The federal government can play an important role in facilitating coordination among these authorities and with the industry in responding to power system emergencies. The federal government should work with theseparties to help improve and better coordinate these responses. 7. Demonstrate federal leadership through promotion ofbest reliability practices atfederal utilities. (addresses Findings 1, 2, and 19) Federal utilities are unique assets that have long pursued many federal and regional objectives, ranging from power production to agricultural and economic development. As part oftheir role, these utilities have served as research and development catalysts for technological changes within the industry. Piloting new reliability initiatives would be consistent with this historic leadership role. Actionsforfederal consideration: * Develop and pilotreliability self-assessmentprocedures. Federal utilities should continue to promote best reliability practices through an ongoing process of self-assessment. In addition, power marketing administrations should continue to support their respective generating agencies in those areas that involve the reliability ofhydropower facilities. Federal utilities should continue to participate in continued development ofpilot programs to incorporate new criteria and compliance monitoring for future phases of reliability programs. These programs should provide opportunities for self-assessment,

23**-------~~------** 

### EE-RM/STD-98-440-

# #**13~·** Report o/theDOEPower Outage Study Team on Electric ReliabilityEvents o/theSummer of 1999
.


### 6. Enhance emergency preparedness activities for low-probability, high-consequence events on bulk-power systems. (addresses Findings 3, 4, 9, 20, 23, and 29) Emergencies on bulk-power systems affect large geographic areas, involve many stakeholders, and affect millions ofcustomers. The events ofthe summer of 1999 demonstrated that effective communication and coordination among many parties are critical during times ofsystem emergencies. The federal government should actively support efforts to continually review and improve planning and response capabilities. Action for federal consideration:

• Work with regional, state, andlocal authorities to support continuous improvement in coordination,planning, and preparations to respond to electricity emergencies. A critical element ofemergencypreparedness by industry participants is coordination with and among federal, regional, state, and local authorities. The federal government can play an important role in facilitating coordination among these authorities and with the industry in responding to power system emergencies. The federal government should work with these parties to help improve and better coordinate these responses. 

### 7. Demonstrate federal leadership through promotion ofbest reliability practices at federal utilities. (addresses Findings 1,2, and 19) Federal utilities are unique assets that have long pursued many federal and regional objectives, ranging from powerproduction to agricultural and economic development. As part oftheirrole, theseutiIities have served as research and development catalysts for technological changes within the industry. Piloting new reliability initiatives would be consistent with this historic leadership role. Actions for federal consideration:

• Develop and pilot reliabilityself-assessmentprocedures. Federal utilities should continue to promote bestreliability practices through an -' ongoing process ofself-assessment. In addition, power marketing administrations should continue to support their respective generating agencies in those areas that involve the reliability ofhydropower facilities. Federal utilities should continue to participate in continued development ofpilot programs to incorporate new criteria and compliance monitoring for future phases of reliability programs. These programs shouldprovide opportunities for self-assessment,



### 23

. :
...

## EE-RM/STD-98-440-- 

## /3<p

Reportof theDOE PowerOutageStudy Team onElectricReliabilityEvents oftheSummer of 1999

for monitoring and review ofcompliance, and for sanctions for noncompliance with established reliability criteria. Supportdistributedenergyresources. Federal utilities should support the development and facilitate the installation of distributed energy resources, and they should explore ways for enhancing the reliability oftheir transmission facilities by these installations. Federal utilities should also ensure that their transmission policies aid in integrating electric distribution systems and energy markets to increase reliability. *Encourageeconomic energyefficiency. Federal utilities should strive to implement energy-efficiency measures to reduce the amount ofpower required to serve growing energy loads. In addition, they should continue to develop programs to encourage their utility customers to invest in energy efficiency. 8. Conduct public interest reliability-related research and development consistent with the needs of a restructuringelectric industry. (addresses Findings 5-8, 13, 14, 17, 28, and 33) Industry investments in reliability-related R&D have declined steadily over the past few years. These declines have occurred at least in part because the "clients" fornextgeneration investments, such as regional transmission organizations, are still in their formative stage. Furthermore, the independent system operators currently do not own the transmission assets and are nonprofit institutions. A stable climate for private investments in longer-range R&D conducted with the public's interest in mind does not currently exist. Federal investments in public-interest, reliability-related R&D are especially needed during this time of industry transition. POST strongly supports Secretary Richardson's commitment to increase federal investments in electric reliability R&D as provided for in the Administration's proposed fiscal year 2001 budget. Actionsforfederal consideration: Develop real-timesystem monitoring,communication,andcontroltechnologies. Currently, individual technologies are available for enhancing reliability and increasing trade over existing transmission lines (including Wide Area Measurement System, flexible AC transmission systems (FACTS), and high-voltage DC transmission technologies). However, continued demonstration ofexisting technologies, as well as development ofnew technologies, is needed. Past federal investments in developing and demonstrating some ofthese technologies, which were discontinued starting in the mid-1990s, should be renewed to facilitate adoption ofthese technologies when a more stable climate for investment by industry emerges.

24 "., 

### EE-RM/STD-98-440-#

# /3~":.

" Report of the DOEPower Outage Study Team on Electric ReliabilityEvents of the Summer of J999



### 24 for monitoring and review ofcompliance, and for sanctions for noncompliance with establishedreliability criteria.

• Support distributed energy resources. Federal utilities should support the development and facilitate the installation of distributed energy resources, and they should explore ways for enhancing the reliability oftheir transmission facilities bythese installations. Federal utilities should also ensure that their transmission policies aid in integrating electric distribution systems and energy markets to increase reliability.

• Encourage economic energy efficiency. Federal utilities should strive to implement energy-efficiency measures to reduce the amount ofpowerrequired to serve growing energy loads. 

### In addition, they should continue to develop programs to encourage theirutility customers to invest in energy efficiency. 

### 8. Conductpublic interest reliability-related research and development consistent with the needs ofa restructuring electric industry. (addresses Findings 

### 5-8, 13, 

### 14, 17,28, and 33) Industry investments in reliability-related R&D have declined steadily overthe past few years. These declines have occurred at least in part because the "clients" for next- "" generation investments, such as regional transmission organizations; are still in their formative stage. Furthelmore, the independent system operators currently do not own the transmission assets and are nonprofit institutions. A stable climate for private investments in longer-range R&D conducted with the public's interest in mind**doe~** not currently exist. Federal investments in public-interest, reliability-related R&D are . especially needed during this time ofindustry transition. POST strongly supports " Secretary Richardson's commitment to increase federal investments in electric reliability R&D as provided for in the Administration's proposed fiscal year 2001 budget. 

### Actions for federal consideration:

• Develop real-time system monitoring. communication. andcontrol technologies. Currently, individual technologies are available for enhancingreliability and increasing trade over existing transmission lines (including Wide Area Measurement System, flexible AC transmission systems (FACTS), and high-voltage DC transmission technologies). However, continued demonstration ofexisting technologies, as well as development ofnew technologies, is needed. Past federal investments in developing and demonstrating some ofthese technologies, which were discontinued starting in the
. mid-l990s, should be renewed to facilitate adoption ofthese technologies when a more stable climate for investment by industry emerges. - "

## EE-RM/STD-98-440t7 

# /3Z

-- Reportofthe DOEPowerOutageStudy Team on ElectricReliabilityEvents of the Summer of1999 

### Create sensors,remotemonitoring,anddiagnostictechnologies forcablesand' agingtransmission anddistributioninfrastructure. POST members heard much discussion regarding the value ofimproved cable monitoring technologies and the need for better cable diagnostic techniques. At the same time, the team heard that adoption ofthese technologies and techniques was simply a matter ofcomparing cost to value, and that on that score, additional investments could not bejustified. Federal support for industry-led R&D to lower the costs and improve the reliability ofthese technologies would clearly improve cable maintenance and reliability. 

### *Integratecustomerdemandmanagement,distributed generation,andstorage technologies. Currently, efforts to conduct the R&D necessary to support widespread integration ofdemand management, distributed generation, and storage technologies are limited because parties with the greatest vested interest are constrained in their ability to pursue the necessary research. Utilities, on the one hand, face significant regulatory disincentives to pursue research that, under current regulations, will erode revenues and profits. Distributed energy resource equipment manufacturers lack proprietary information on the design and operation ofutility systems to explore promising new approaches. Federally supported R&D activities are needed to explore new methods of integrating and controlling distributed energy resources in ways that enhance system reliability. An important focus ofthese activities should be development oftechnologies that would allow these resources toparticipate directly in competitive markets for energy and ancillary services. 

### Improve analyticmodels forloadforecasts, powersystem simulation,and contingency assessments. Uncertainty is apervasive element ofreliability planning and operations. Methods and data are needed to better understand traditional sources ofuncertainty (e.g., weather and equipment performance), as well as new sources introduced by restructuring (e.g., behavior ofmarket participants). Federally sponsored R&D should spurthe accelerated transfer and testing ofpromising techniques from other fields to enhance models used by the electricity industry. 

### Examine thedesignandperformance of competitive electricitymarkets. A special need exists forunbiased public interest research on the design and performance ofcompetitive electricity markets. Interdisciplinary, science-based approaches involving both market economics and power system engineering are required. Federally sponsored R&D should support developing metrics, designing and conducting experiments, analyzing performance, and testing alternatives.

25 '-

# EE-RM/STD-98-44~**I~** 

# ... -- Reportof the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summer oj1999

• Create sensors, remote monitoring, anddiagnostic technologies for cables and' aging transmission anddistribution infrastructure. POST members heard much discussion regarding the value ofunproved cable monitoring technologies and the need for better cable diagnostic techniques. At the same time, the team heard that adoption ofthese technologies and techniques was simply a matterofcomparing cost to value, and that on that score, additional investments could not bejustified. Federal support for industry-led R&D to lower the costs and improve the reliability ofthese technologies would clearly improve cable maintenance and reliability.

• Integrate customer demandmanagement, distributedgeneration, andstorage technologies. Currently, efforts to conduct the R&D necessary to support widespread integration' ofdemand management, distributed generation, and storage technologies are limited because parties with the greatest vested interest are constrained in their ability to pursue the nec'essary research. Utilities, on the one hand, face significantregulatory disincentives to pursue research that, undercurrent regulations, will erode revenues and profits. Distributed energy resource equipment manufacturers lackproprietary information on the design and operation ofutility systems to explore promising new approaches. Federally supported R&D activities are needed to explore new methods of integrating and controlling distributed energy resources in ways that enhance system' reliability. An important focus ofthese activities should be development oftechnologies that would allow these resources to participate directly in competitive markets for energy and ancillary services.
. . Improve analytic models for load forecasts,powersystem simulation, and contingency assessments. Uncertainty is a pervasive element ofreliability planning and operations. Methods and data are needed to betterunderstand traditional sources ofuncertainty (e.g., weather and equipment performance), as well as new sources introduced by restructuring (e.g., behavior ofmarket participants). Federally sponsored R&D should spurthe accelerated transfer and testing ofpromising techniques from otherfields to enhance models used bythe electricity industry.
.
• Examine the design andperformance of competitive electricity markets. A special need exists for unbiased public interest research on the design and performance ofcompetitive electricity markets. Interdisciplinary, science-based approaches involving both market economics and power system engineering are .. . required. Federally sponsored R&D should support developing metrics, designing and' conducting experiments, analyzingperformance, and testing alternatives.



## 2S .'**~** .

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# /53
Reportof theDOEPowerOutageStudy Team onElectric ReliabilityEvents of theSummer of1999

9. Facilitate and empower regional solutions to the siting of generation and transmission facilities. (addresses Findings 1, 10, and 26) Stable incentives for investing in generation and transmission must be complemented by siting boards that can discharge their responsibilities in a timely and coordinated fashion. Suchboards need to address two primary problems. First, policies among agencies, among states, between state and federal agencies, and among federal agencies overlap and sometimes conflict. Second, parochial bodies do not have incentives to seek regional solutions. These problems result in long delays, and they could lead to inefficient and inequitable siting decisions. Actionsforfederal consideration: Conveneregionalsummits to initiate andfacilitate dialogamongregional stakeholders. Dialog among stakeholders is the first step in identifying regional solutions. Because ofits national perspective, the federal government could be an important leader in brokering these discussions. The federal government should continue to convene regional summits thatprovide for meaningful participation by all stakeholders and for equitable resolution ofoutstanding issues. *Support federallegislationto facilitatestateefforts to form regionalsiting boards. Empowering regional decision-making boards is a logical complement to summits that initiate dialog among regional stakeholders. The authority ofthese boards must be final and binding on all parties. Federal legislation should be enacted that will allow states to create these authorities. *Raise reliability asan issue(as appropriate) wherefederalpermits arerequired forsitingelectric facilities. The federal government participates in siting decisions through various federal agencies. These agencies should give appropriate consideration to electric reliability. The Department ofEnergy could provide guidance to federal agencies regarding the need for and value ofelectric reliability in siting proceedings. 10. Promote public awareness ofelectric reliability issues. (addresses Findings 2, 19, and 23) General public awareness ofthe complex issues associated with maintaining reliable electric service is low. Yet, as demonstrated by the events ofthe summer of 1999, public interest in reliable electric service is high. Greater understanding ofelectric reliability issues, including both the frequency and causes ofoutages and the steps beingtaken to

26 

### EE-RM/STO-98-440-#

## /3~ Report of the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of 1999



### 26 

### 9. Facilitate and empower regional solutions to the siting ofgeneration and transmission facilities. (addresses Findings 1, 10, and 26) Stable incentives for investing in generation and transmission must be complementedby siting boards that can discharge theirresponsibilities in a timely and coordinated fashion. Suchboards need to address two primaryproblems. First, policies among agencies, among states, between state and federal agencies, and among federal agencies overlap and sometimes conflict. Second, parochial bodies do not have incentives to seekregional solutions. These problems result in long delays, and they could lead to inefficient and inequitable siting decisions. 

### Actions for federal consideration:

• Convene regionalsummits to initiate and facilitate dialog among regional stakeholders. Dialog among stakeholders is the first step in identifying regional solutions. Because ofits national perspective, the federal government could be an important leader in brokering these discussions. The federal government should continue to convene regional summits thatprovide for meaningful participation by all stakeholders and for equitable resolution ofoutstanding issues.

• Support federal legislation tofacilitate state efforts toform regionalsiting**~~** 

# - Empowering regional decision-making boards is a logical complement to summits that initiate dialog among regional stakeholders. The authority ofthese boards must be fmal and binding on all parties. Federal legislation should be enacted that will allow. states to create these authorities.

• Raise reliability as an issue (as appropriate) where federalpermits are required forsiting electric facilities. Thefederal govemmentparticipates in siting decisions through various federal agencies. These agencies should give appropriate consideration to electric reliability. The Department ofEnergy could provide guidance to federal agencies regarding the need
. for and value ofelectric reliability in siting proceedings.
. 

### 10. Promote public awareness ofelectric reliability issues. (addresses Findings 2, 19, and 23) General public awareness ofthe complex issues associated with maintaining reliable electric service is low. Yet, as demonstrated bythe events ofthe summer of 1999, public interest in reliable electric service is high. Greaterunderstanding ofelectric reliability issues, including both the frequency and causes ofoutages and the steps bemgtaken to , . \: .

### EE-RM/STD-98-440 -' 

### /3_- Reportof theDOEPowerOutageStudy Team on ElectricReliabilityEvents oftheSummer of1999


### prevent and limit the consequences ofoutages, will lead to better-informed decisions. Special attention should be placed on discussing the costs and trade-offs inherent in making reliability investment and operating decisions. Future activities should complement, not replace, existing state, utility, and locally led efforts andbe effectively· coordinated with them. Actionsforfederal consideration: * ContinueDOE-sponsoredindependentinvestigationsofsignificantpower

outagesandotherreliability events. Stakeholder support forthe studies and technical workshops conducted by POST confirms the important role that the federal government plays in increasing the awareness ofreliability issues during industry restructuring. The federal government should continue to conduct periodic studies ofsignificant reliability events to identify problem areas and torecommend additional federal actions, as warranted. * ContinueDOE-sponsoredforumswherestakeholderscanmeet to discuss reliabilityissues. As the electric power industry changes, a special need exists for a dialog among stakeholders and information exchanges onreliability issues. Many thoughtful comments have been expressed on options for the future organization ofthe industry and the reliability issues these options seek to address. The evolution ofthese ideas is especially needed. Such ideas include the important process ofdeveloping consensus forthe most. promising ideas and holding forums for discussing feedback on what works and what does not work. DOE-sponsored conferences, workshops, and other exchanges would facilitate this process. 11. Monitor and assess vulnerabilities to electric power system reliability. (addresses Findings 5, 7, 9, 16, 25, and 26) The outages and disturbances studied by POST resulted from unpredicted events that exploited specific weaknesses inphysical systems and the planning and operating processes that supported them (e.g., extremely hot weather caused overloads and cable failures): Other electric power system vulnerabilities were identified during POST's studies and technical workshops. Inview ofthe regional and national implications of power outages, known and emerging electric system vulnerabilities need to be studied from a national rather than a local perspective. Studies from a national perspective uniquely belong to the federal government, but studies mustbe carried out in close partnership with the electric industry.

27 

# ----------

----- 

### EE-RM/STO-9S-440,

# -:#

# !3c:<-
_ Report a/theDOEPower Outage Study Team on Electric ReliabilityEvents a/theSummer

### 0/1999
prevent and limit the consequences ofoutages, will lead to better-informed decisions. Special attention should be placed on discussing the costs and trade-offs inherent in making reliability investment and operating decisions. Future activities should complement, not replace, existing state, utility, and locally led efforts and be effectivelycoordinated with them. Actions for federal consideration:

• ContinueDOE-sponsored independent investigations of significantpower outages andother reliability events. Stakeholder support for the studies and technical workshops conducted byPOST confirms the important role that the federal government plays in increasing the awareness ofreliability issues during industry restructuring. The federal government should continue to conductperiodic studies ofsignificant reliability events to identify problem areas and to recommend additional federal actions, as warranted.

• ContinueDOE-sponsored forums where stakeholders can meet to discuss reliability issues. As the electric power industry changes, a special need exists for a dialog among " stakeholders and information exchanges on reliability issues. Many thoughtful comments have been expressed on options for the future organization ofthe industry and the reliability issues these options seek to address. The evolution ofthese ideas is especially needed. Such ideas include the important process ofdeveloping consensus for the most" promising ideas and holding forums for discussing feedback on what works and what does not work. DOE-sponsored conferences, workshops, and other exchanges would facilitate this process. 

### II. Monitor and assess vulnerabilities to electric power system reliability. (addresses Findings 5, 7, 9, 16,25, and 26) The outages and disturbances studied by POST resulted from unpredicted events that exploited specific weaknesses in physical systems and the planning and operating processes"that supported them (e.g., extremely hot weather caused overloads and cable failures): Other electric power system vulnerabilities were identified during POST's studies and technical workshops. 

### In view ofthe regional and national implications of power outages, known and emerging electric system vulnerabilities need to be studied from a national ratherthan a local perspective. Studies from a national perspective uniquely belong to the federal government, but studies must be carried out in close partnership with the electric industry.



### 27

".:.,' .

### EE-RM/STD-98-440 /f 

## / \2 ReportoftheDOE Power OutageStudy Team on ElectricReliabilityEvents ofthe Summerof1999

Actionsfor federal consideration: Work with industrystakeholdersto conductcomprehensiveassessmentsof electric powersystem vulnerabilities. An appropriate role for the federal government would be to work with industry to assess and analyze vulnerabilities and to develop the technologies and expertise necessary for reducing such vulnerabilities. The federal government has already initiated a series of assessments toward this end, which are being implemented in close partnership with industry. These efforts should be continued. Work with industrystakeholdersto refineand implementproceduresto assess the robustnessofthe electricitysystem in respondingto bulk-powersystem emergencies. Well-established procedures are in place for responding to system emergencies. However, they need to be thoroughly tested and updated regularly. In particular, consistency within procedures is needed when many operating entities are coordinating efforts. The federal government should build on efforts initiated during preparations for the Year 2000 to ensure that emergency preparedness remains a high priority. Specifically, the federal government should work with industry to enhance assessment procedures to ensure consistent and coordinated responses to system emergencies. 

### 12. Encourage energy efficiency as a means for enhancing reliability. (addresses Findings 2, 10, and 19) The increased adoption ofenergy efficiency measures can enhance electric system reliability by reducing demand growth in areas experiencing shortages in electric generation or constraints in electric transmission or distribution. Programs to stimulate adoption ofenergy-efficient technologies and practices canprovide more rapid reliefto areas with fast-growing demand. Further, they can do so with fewer negative impacts than would occur during the construction ofnew generation, transmission, and distribution facilities. Such programs might be especially helpful in areas where growth in electric demand is high; yet, markets for new generation are in their infancy or existing incentives for investments in transmission and distribution are in transition. Technologies and practices that reduce loads during times ofpeak demand, such as highefficiency air conditioning and lighting equipment, are especially valuable. Actionsfor federal consideration: Work with stateandlocalgovernments to supportdevelopment and implementationofcost-effective energy efficiencyprograms. Utility demand-side management programs were successful in reducing demand growth during the early 1990s. These activities began to decline, however, as the

- industry prepared for restructuring. Many states have triedto preserve funding for these



### 28 

### EE..RM/STD..98-440

# 1t /3**-~-** Report of the DOEPower Outage Study Team on Electric ReliabilityEvents of the Summer of J

999



### 28 Actions for federal consideration: Work with industrystakeholders to conduct comprehensive assessments of electricpowersystem vulnerabilities. An appropriate role for the federal government would be to work with industry to assess and analyze vulnerabilities and to develop the technologies and expertise necessary for reducing such vulnerabilities. The federal government has already initiated a series ofassessments toward this end, which are being implemented in close partnership with industry. These efforts should be continued. Work with industrystakeholders to refine and implementprocedures to assess the robustness of the electricitysystem in responding to bulk-powersyste"! emergencies. Well-established procedures are in place for responding to system emergencies. However, they need to be thoroughly tested and updated regularly. Inparticular, consistency within procedures is needed when many operating entities are coordinating efforts. The federal government should build on efforts initiated during preparations for the Year 2000 to ensure that emergency preparedness remains a high priority. Specifically, the federal government should work with industry to enhance assessment procedures to ensure consistent and coordinated responses to system emergencies. 12. Encourage energy efficiency as a means for enhancing reliability. (addresses Findings 2, 1 

### b, and 19) The increased adoption ofenergy efficiency measures can enhance electric system reliability by reducing demand growth in areas experiencing shortages in electric generation or constraints in electric transmission ordistribution. Programs to**sti~ulate** .. adoption ofenergy-efficient technologies and practices canprovide more rapid reliefto areas with fast-growing demand. Further, they can do so with fewer negative impacts than would occur during the construction ofnew generation, transmission, and distribution facilities. Such programs might be especially helpful in areas where growth in electric.demand is high; yet, markets for new generation are in their infancy or existing incentives for investments in transmission and distribution are in transition. Technologies and practices that reduce loads during times ofpeakdemand, such as 

### bighefficiency air conditioning and lighting equipment, are especially valuable. Actions for federal consideration: Work with state andlocalgovernments to support development and implementation of cost-effective energy efficiencyprograms. Utility demand-side management programs were successful in reducing demand growth during the early 1990s. These activities began to decline, however, as the

-.. industryprepared for restructuring. 

### Many states have tried to preserve funding for these

;;- ."'

## EE-RM/STD-98-440-o 4S ReportoftheDOEPowerOutageStudy Team on Electric ReliabilityEvents of the Summer of

activities concurrent and consistent with the development ofcompetitive markets for
. : energy. The federal government should work with state and local governments to continue and expand these efforts, both to improve reliability in the short term, while markets develop, and, in the long term, to the extent markets do not fully capture the public reliability and other benefits that they offer. Expandexistingfederalprograms topromoteenergy efficiency. The federal government currently conducts research in support ofmore efficient end-use technologies, promulgates standards for more efficient technologies, and provides weatherization assistance to low-income households. These well-established federal activities should be expanded in ways that are consistent with improving the reliability ofthe U.S. electric power system through more efficient use ofelectricity. Table 2 Summary ofRecommendations and Associated Findings

No. Recommendation Relevant Findings'

1 Promote market-based approaches to ensure reliable 1-3, 10, 12, 19, and 37 electric services. 2 Enable customer participation in competitive electricity 1,2, 10, 19, and 20 markets. 3 Remove barriers to distributed energy resources. 1, 2, 10, and 19 4 Support mandatory reliability standards for bulk-power 4, 11, 21, 24, and 36-38 systems. 5 Support reporting and sharing of information on "best 5-9, 11, 15-18, 21, 22, practices." 24, 27, and 29-38 6 Enhance emergency preparedness activities for low- 3, 4, 9, 20, 23, and 29 probability, high-consequence events on bulk-power systems. 7 Demonstrate federal leadership through promotion of 1,2, and 19 best reliability practices at federal utilities. 8 Conduct public interest reliability-related research and 5-8, 13, 14, 17, 28, development consistent with the needs ofa and 33 restructuring electric industry. 9 Facilitate and empower regional solutions to the siting 1, 10, and 26 ofgeneration and transmission facilities. : ' .. 10 Promote public awareness ofelectric reliability issues. 2, 19, and 23 11 Monitor and assess vulnerabilities to electric power 5, 7, 9, 16, 25, and 26 system reliability. 12 Encourage energy efficiency as a means for enhancing 2, 10, and 19. reliability. The numbers assigned to the relevant findings correspond to the numbers assigned to the findings in Section 3.

29
.

## EE.RM/STD;'98~440-tJ::== . Report of theDOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of 1

activities concurrent and consistent with the development ofcompetitive markets for energy. The federal government should work with state and local governments to . continue and expand these efforts, both to improve reliability in the short term, while markets develop, and, 

### in the long term, to the extent markets do not fully capture the public reliability and otherbenefits that they offer.

• Expandexistingfederalprograms topromote energy efficiency. The federal government currently conducts research 

### in support ofmore efficient end-use technologies, promulgates standards for more efficient technologies, and provides weatherization assistance to low-income households. These well-established federal activities should be expanded 

### in ways that are consistent with improving the reliability ofthe 

## u.s. electric power system through more efficient use ofelectricity. Table 2 Summary ofRecommendations and Associated Findings

No. Recommendation Relevant Findings" Promote market-based approaches to ensure reliable 1-3,1O,12,19,and37 electric services. 2 Enable customer participation in competitive electricity 1,2, 10, 19, and 20 markets. 3 Remove barriers to distributed energy resources. 1,2,10, and 19 4 Support mandatory reliability standards for bulk-power 4, 11,21,24, and**3~38** systems. 5 Support reporting and sharing ofinformation on ''best 5-9, II, 15-18,21,22, practices." 24,**27~** and 29-38 6 Enhance emergencypreparedness activities for low- 3, 4, 9, 20, 23, and 29 probability, high-consequence events onbulk-power systems... 7 Demonstrate federal leadership through promotion of 1,2, and 19 best reliability practices at federal utilities. 8 Conduct public interest reliability-related research and 5-8,13,14,17,28, development consistent with the needs 

### ofa and 33 restructuring electric industry. 9 Facilitate and empower regional solutions to the siting 1, 10, and 26 ofgeneration and transmission facilities. 10 Promote public awareness ofelectric reliability issues. 2, 19, and 23 11 Monitor and assess vulnerabilities to electric power 5,7,9, 16, 25, and 26 system reliability. 12 Encourage energy efficiency as a means for enhancing 2,10, and 19. reliability.

8 Thenumbers assigned to the relevant findings correspond to the numbers assigned to the findings in Section 3. .. :-

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## EE-RM/STD-9 8

## -440

# -#/,3-P
Reportof theDOEPowerOutageStudy Team on ElectricReliabilityEventsofthe Summer of 1999

30

## E~-RM/STD-98;'4404/3::<. Report of the DOEPower Outage Study Team on Electric ReliabilityEvents of the Summer of J

999

30

### EE-RM/STD-98-440-t/<S. 

# Appendix A Summary of Public Comments

This appendix summarizes comments received and suggestions made regarding actions that the federal government could take to address the findings ofthe Power Outage Study Team (POST). These summaries have been categorized to correlate with the five topic areas that were identified in the POST Interim Report' and used to structure the discussions at three technical workshops organized by the POST. The summaries reflect comments sent directly to the POST as well as comments offered at the three workshops. 

### A.1 Transition to Competitive Energy Service Markets Most ofthe commenters sawrestructuring as being part ofthe solution for achieving reliable electric service. Commenters who tried to link ongoing restructuring activities with the reliability disruptions oflast summer (orto link restructuring with larger trends in areas such as utility staffing and maintenance practices) also offered possible solutions for improving reliability that took restructuring into account. The comments most germane to the industry transition are categorized here into four areas: the effects of competitive energy markets on reliability, customer participation in competitive energy markets, emerging institutions for managing reliability issues in a competitive market, and unique federal roles in a competitive market. Many comments that addressed this topic are also relevant to the other topics and are included in those sections as well. 

### A.1.1 Effect of Competitive Energy Markets on Reliability A theme repeated in many comments was that the federal government should recognize that electric markets are the appropriate first line ofdefense for ensuring reliable electric service. Several commenters mentioned regions ofthe United States where substantial investments in new electric generating capacity were recently announced. In all cases, these investments were made first inresponse to the need for new capacity and second in response to the emerging markets, which enable new generating sources to compete to meet these needs. Many commenters were optimistic, believing that ultimately, such competitive markets wouldbe sufficient to ensure : adequate long-term investments in generation capacity. Other commenters suggested that competitive markets are the best mechanism for managing reliability in the short term. An example ofthe inefficiency created under current non-market-based transmission loading reliefprocedures was provided. Under these procedures, transactions involving hundreds ofmegawatts ofcapacity in one part of the interconnected power system can cause curtailment oftransactions involving thousands ofmegawatts ofcapacity in another part ofthe system.

InterimReportof the U.S. Departmentof Energy'sPowerOutageStudy Team, Findings from the Summerof1999, January 2000. 

### A-l EE-RM/STD-98-440

# -#-13~:~

# : Appendix 

# A
.. Summary of Public Comments

This appendix summarizes comments received and suggestions made regarding actions that the federal government could take to address the findings ofthe Power Outage Study Team (POST). These summaries have been categorized to correlate with the five topic areas that were identified in the POST Interim Reportl and used to structure the discussions at three technical workshops organized by the POST. The summaries
. reflect comments sent directly to the POST as well as comments offered at the three workshops. 

### A.1 Transition to Competitive Energy Service Markets Most ofthe commenters sawrestructuring as being part ofthe solution forachieving
.. reliable electric service. Commenters who tried to link ongoing restructuring activities· .' with the reliability disruptions oflast summer (or to link restructuring with larger trends in areas such as utility staffing and maintenance practices) also offered possible solutions for improving reliability that took restructuring into account. The comments most germane to the industry transition are categorized here into four areas: the effects of competitive energy markets on reliability, customerparticipation in competitive energy markets, emerging institutions for managing reliability issues in a competitive market, and unique federal roles in a competitive market. Many comments that addressed this topic are also relevant to the other topics and are included in those sections as well. 

### A.1.1 Effect of Competitive Energy Markets on Reliability A theme repeated in many comments was that the federal government should recognize that electric markets are the appropriate first line ofdefense for ensuring reliable electric service. Several commenters mentioned regions ofthe United States where substantial investments in new electric generating capacity were recently announced. In all cases, these investments were made first in response to the need for new capacity and second in response to the emerging markets, which enable new - generating sources to compete to meet these needs. Many commenters were optimistic, believing that ultimately, such competitive markets would

### be sufficient to ensure . adequate long-term investments in generation capacity.

.**.~** . Othercommenters suggested that competitive markets are the best mechanism for managing reliability in the short term. An example ofthe inefficiency created under current non-market-based transmission loading reliefprocedures was provided. Under' these procedures, transactions involving hundreds ofmegawatts ofcapacity in one part.of the interconnected power system can cause curtailment oftransactionsinvolving
. thousands ofmegawatts ofcapacity in anotherpart ofthe system. . " .

. .. Interim Reportof the Us. Departmentof Energy's Power Outage Study Team, Findingsfrom the Summer of1999. January 2000.
. . .
A-I

## EE-RM/STD-98-440- z/I
ReportoftheDOE Power OutageStudy Team on ElectricReliabilityEvents of the Summerof1999


### In reflecting onthe voltage drops ofJuly 6 and July 19, Interconnection, LLC (PJM), attributed the more rapid system recovery onJuly 19 at least inpart to market-led : curtailments in direct response to the high location-based marketprices observed on that
. day. It was suggested that market participants might have learned from the events of July 6, so that by July 19, they already had plans to respond profitably to prevailing market signals. PJM also described how, as a result ofthe events ofthe summerof 1999, it obtained Federal Energy Regulatory Commission approval to impose a tariffthat will provide generators with compensation for reactive powerproduction at the opportunity cost of foregone real power sales. This tariffallows PJM to ensure that its directions to generators to produce reactive power are now consistent with the competing incentives the market offers toproduce real power. 2 

### A.1.2 Customer Participation in Competitive Energy Markets Many commenters suggested that the fact that end-use customers do not participate in competitive markets is a major factor that contributes to short-term energy shortages, such as those that occurred during last summer's heat waves. Reliability depends on a utility's abilityto serve a sudden and inflexible surge in electricity demand. These commenters noted that public appeals for conservation get mixedresults. What is really needed is a mechanism forbalancing the cost ofserving an increased load by acquiring more power with the cost ofreducing load. Unless customers are given meaningful opportunities (not mandates) toparticipate, this balance will notbe achieved. Instead, market inefficiency will persist, leading to periodic energy shortages and unnecessarily high prices forenergy and ancillary services during periods ofpeak demand. Some commenters noted that now, when energy and ancillary services are in short supply, generators are the primary beneficiaries ofthe higher prices for these services. If customers could see these high prices and be able torespond to them by selling their loads in the market, they too could share in the economic rewards. The end result would be threefold: more stable prices for electricity and ancillary services, a reduced need for investment in transmission systems, and more reliable electric service. Several commenters observed that coupled with the use ofcompetitive markets to get the prices for electric service "right," steps must be taken to ensure that these prices can be seen. Electric reliability has a price, and this price must be visible ifcustomers are to make reasoned, economically efficient decisions about their electric service. One commenter pointed out the need forrobust communication infrastructures to convey price information.

..

2 

### Typically, generators can produce both real and reactivepower. At times ofpeak real power - .

generation, increased reactive power generation (essential for maintaining system stability during high system loads) requires areduction inreal power generation.

A-2

## EE·RM/STD-98-440~

# #1**~-** Report of the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of 1999

A-2 In reflecting on the voltage drops ofJuly 6 and July 19, Interconnection, LLC (PJM), attributed the more rapid system recovery onJuly 19 at least in partto market-led' curtailments in direct response to the high location-based market prices observed onthat , day. It was suggested that market participants might have learned from the events of

- July 6, so that by July 19, they already had plans to respond profitablyto**prev~ling** market signals. PJM also described how, as a result ofthe events ofthe summerof 1999, 

### itobtained Federal Energy Regulatory Commission approval to iplpose a tariffthat will provide generators with compensation for reactive powerproduction at the opportunity cost of foregone real power sales. This tariffallows PJM to ensure that its directions to generators to produce reactive power are now consistent with the competing incentives the market offers to produce real power.2 

### A.1.2 Customer Participation in Competitive Energy Markets Many commenters suggested that the fact that end-use customers do not participate in competitive markets is a major factor that contributes to short-tenn energy shortages, ' such as those that occurred during last summer's heat waves. Reliability depends on a utility'S ability to serve a sudden and inflexible surge in electricity demand. These commenters noted that public appeals for conservation get mixedresults. What is really needed is a mechanism for balancing the cost ofserving an increased loadby acquiring more power with the cost ofreducing load. Unless customers are given meaningful , opportunities (not mandates) to participate, this balance will notbe achieved. Instead, market inefficiency will persist, leading to periodic energy shortages and unnecessl:!rily high prices for energy and ancillary services duringperiods ofpeak demand. Some commenters noted that now, when energy and ancillary services are in's'hort supply, generators are the primary beneficiaries ofthe higherprices for these services. If customers could see these high prices and be able,to respond to them by selling their , loads in the market, they too could share in the economic rewards. The end resultwould be threefold: more stable prices for electricity and ancillary services, a reduced need for investment in transmission systems, and more reliable electric service. Several commenters observed that coupled with the use ofcompetitive markets to-' get the prices for electric service "right," steps must be taken to ensure that these prices can be seen. Electric reliability has a price, and this price must be Visible ifcustomers are to make reasoned, economically efficient decisions about their electric service.

# One ' commenterpointed out the need for robust communication infrastructures to conveyprice infonnation.

2 Typically, generators can produce both real and reactive power. At times ofpeakreal power generation, increased reactive power generation (essential for maintaining system stability, ' during high system loads) requires a reduction in real power generation.' ': , ,



## .... " -"':'.

.**~"./** ..

## EE-RM/STD-98-440 /3 . Reportof theDOEPower OutageStudy Team onElectricReliabilityEvents of the Summer of 1999 

### Several commenters described emerging efforts to increase opportunities for : demand-side participation in competitive electric markets. Some utilities and system operators are experimenting with real-time and price-sensitive interruptible tariffs. However, these opportunities are now primarily available to only the largest customers, because the costs ofparticipation are too high when compared with the savings that are available. Some commenters discussed the need for advances in communication and metering technologies to increase the opportunities for smallercustomers to participate. Some commenters focussed on a related but (in important ways) distinct form of demand-side participation that should be encouraged: distributed energy resources. A federal role in promoting wider adoption ofthese technologies was suggested. This role would include conducting research and development (R&D) on advanced system integration concepts and supporting near-term activities to remove regulatory barriers that impede adoption ofthese technologies. The current federal support ofefforts to develop interconnection standards was cited as a prime example ofan appropriate federal activity that should be continued. Throughout these discussions, many commenters emphasized that decisions to participate in competitive markets should remain firmly in the customer's control. In other words, in a free market, customers should be empowered to choose howthey can best meet their energy needs. Some customers that can adjust their loads might choose real-time pricing or direct participation in markets forenergy and ancillary services. Others might choose a fixed price (as in most current utility tariffs). The point is that customers, not regulators, should be making these decisions. But in order to make informed decisions, customers require access to market information and prices. Such access requires actions by the appropriate regulatory authorities. 

### A.1.3 Emerging Institutionsfor Managing Reliability in a Competitive Market A third major theme addressed by commenters was the role ofthe federal government with respect to the emerging institutions responsible for organizing trade and ensuring reliability in a restructured industry. These comments, by and large, pointed out that the federal government needs to ensure that state and regional conditions are . acknowledged and that the primacy ofexisting state and regional decision-making processes is respected. The commenters suggested that the federal government should embrace the diversity ofapproaches already being used and seekto exert its influence in support ofexisting local, state, and regional institutions. For example, the federal government could become a public member on the boards for independent system operators and thereby influence their evolution.

A-3

# EE.RM/STD.98.440-#=/~ - Reportof the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of 1999
Several commenters described emerging efforts to increase**opportuniti~s** for
. demand-side participation in competitive electric markets. Some utilities and system operators are experimenting with real-time andprice-sensitive interruptible tariffs. However, these opportunities are now primarily available to only the largest customers, because the costs ofparticipation are too high when compared with the savings that are available. Some commenters discussed the need for advances in communication and metering technologies to increase the opportunities for smallercustomers to participate. Some commenters focussed on a related but (in important ways) distinct form of demand-side participation that should be encouraged: distributed energy resources. A federal role in promoting wider adoption ofthese technologies was suggested. This role would include conducting research and development (R&D) on advanced system integration concepts and supporting near-term activities to remove regulatory barriers that impede adoption ofthese technologies. The current federal support ofefforts to develop interconnection standards was cited as a prime example ofan appropriate federal activity that should be continued. Throughout these discussions, many commenters emphasized that decisions to participate in competitive markets should remain firmly in the customer's control. 

### In
. other words, in a free market, customers should be empowered to choose how they can best meet theirenergy needs. Some customers that Cll11 adjust their loads might choose real-time pricing ordirect participation in markets for energy and ancillary services. Others might choose a fixed price (as in most current utility tariffs). The point is that customers, not regulators, should be making these decisions. But in order to make informed decisions, customers require access to market information and prices. Such access requires actions by the**appropria~e** regulatory authorities. 

### A.1.3 Emerging Institutions for Managing Reliability in a Competitive Market A third major theme addressed by commenters was the-role ofthe federal government with respect to the emerging institutions responsible for organizing trade and
. ensuring reliability in a restructured industry. These comments, by and large, pointed out that the federal government needs to ensure that state and regional conditions are acknowledged and that the primacy ofexisting state and regional decision-makiilg processes is respected. The commenters suggested that the federal government should embrace the diversity ofapproaches already being used and seek to exert its influence in support ofexisting local, state, and regional institutions. Forexample, the federal government couldbecome a public member on the boards for independent system operators and thereby influence their evolution.

A-3 -**~**

### EE-RM/STD-98-440 ^- /-) ReportoftheDOEPowerOutageStudy Team onElectricReliabilityEvents of the Summerof1999 

### A.1.4 Unique Federal Roles in aCompetitive Market Commenters pointed to two areas in which the federal government could play a unique role withregard to the transition to competitive markets: (1)federal utilities, including the power marketing administrations, and (2) public awareness. The federal utilities exert great influence on restructuring activities in their regions. Commenters saw their abilityto exert afederal presence in regional developments as a positive way the federal government could promote reliability. Several commenters observed that the public's level ofawareness about electric industry restructuring is low. Disruptions inreliability, such as the events oflast summer, fuel public concern that restructuring is somehow to blame forproblems. Some commenters suggested that a critically needed and essential role for the federal government is to increase the public's awareness ofelectric industry restructuring in general and electric power reliability in particular. This role should be undertaken in coordination with industry stakeholders. No one disputed the authority or legitimacy of the federal government in playing a leadership role in providing objective information of this type. In fact, several commenters expressed appreciation for the POST activity and said that it was appropriate and reassuring forthe federal government to watch market developments, especially with respect to the their effect onreliability.- 

### A.2 Regulatory Policyfor Reliable Transmission and Distribution Commenters suggested that a number of areas related to transmission and distribution (T&D) regulatory policies should be revisited. These included (1)the roles of industry and government in managing reliability, (2)incentives for investing in transmission system reliability, (3)regional coordination in siting generation and transmission facilities, and (4) state public utility commission (PUC) regulation of electric distribution. 

### A.2.1 Roles of Industry and Government in Managing Reliability Commenters expressed strong support for continuing to rely on self-regulation rather than government regulation to manage the reliability ofthe bulk-power system. However, many ofthese commenters also acknowledged the limitations ofthe current voluntary form ofreliability management and the need for federal oversight to support mandatory
. reliability standards. Several commenters explicitly supported the proposal to transform the North American Electric Reliability Council (NERC) into the North American Electric Reliability Organization. In a discussion ofthe features that mandatory reliability rules shouldhave, one commenter emphasized an open standard-setting process. 

### A.2.2 Incentives for Investing in Transmission System Reliability Several commenters pointed out that investments in transmission capacity have not kept up with investments in generation capacity. As a result, parts ofthe United States may experience delivery problems. These problems increase the risk to system reliability.

A-4 

### , "-:" . '1-

# EE.RM/STD~98.44O---#**j3~:**

# ...

, Report of the DOEPower Outage Study Team onElectric ReliabilityEvents of the Summer of 1999


### A.1.4 Unique Federal Roles in a Competitive Market Commenterspointed to two areas in which the federal government could playa unique role with regard to the transition to competitive markets: (1) federal utilities,

- including the powermarketing administrations, and (2) public awareness. The federal utilities exert great influence on restructuring activities in their regions. Commenters saw their ability to exert a federal presence in regional developments as a positive way the federal government couldpromote reliability. Several commenters observed that the public's level ofawareness about electric industry restructuring is low. Disruptions in reliability, such as the events oflast summer, fuel public concern that restructuring is somehow to blame for problems. Some commenters suggested that a critically needed and essential role for the federal
. ,government is to increase the public's awareness ofelectric industry restructuring in general and electric powerreliability in particular. This role should be undertaken in coordination with industry stakeholders. No one disputed the authority orlegitimacy of the federal government in playing a leadership role in providing objective information of this type. In fact, several commenters expressed appreciation for the POST activity and said that it was appropriate and reassuring for the federal government to watch market developments, especially with respect to the their effect onreliability. 

### A.2 Regulatory Policy for Reliable Transmission and Distribution

A-4 Commenters suggested that a number ofareas related to transmission and distribution (T&D) regulatory policies should be revisited. These included (1) the'roles of industry and government in managing reliability, (2) incentives for investing in
. transmission system reliability, (3) regional coordination ,in siting generation and transmission facilities, and (4) state public utility commission (PUC) regulation of electric distribution. 

### A.2.1 Roles of Industry and Government in Managing Reliability Commenters expressed strong support for continuing to rely on self-regulationratherthan governmept regulation to manage the reliability ofthe bulk-power system. However,. many ofthese commenters also acknowledged the limitations ofthe current voluntary , form ofreliability management and the need for federal oversight to support mandatory reliability standards. Several commenters explicitly supported the proposal to transform·, the North American Electric Reliability Council (NERC) into the North American Electric Reliability Organization. In a discussion ofthe features that mandatory reliability
.**rul~s** should have, one commenter emphasized an open standard-setting process. 

### A.2.2 Incentives for Investing in Transmission System'Reliability Several commenters pointed out that investments in transmission capacity have not, kept up with investments in generation capacity. As a result, parts ofthe United States may experience delivery problems. These problems increase the riskto system reliabilityc· ...... :

..•.
-

### EE-RM/STD-98-440--4-/5
Reportof the DOE Power OutageStudy Team onElectricReliabilityEvents ofthe Summer of1999 

### Thus, a bigger investment in transmission capacity to support increased trade would also tend to increase system reliability. These commenters suggested that to a degree, the low levels ofinvestment in

- transmission capacity now simply reflectthe uncertainties currently facing investors. They indicated that hastening or smoothing the transition to competitive markets would largely address this issue. Some commenters mentioned that current earning opportunities are insufficient to support needed investments in transmission capacity. No suggestions for specific federal actions to address this issue were mentioned, beyond those already identified in Section A. 1on the transition to competitive energy service markets. 

### A.2.3 Regional Coordination in Siting Generation and Transmission Facilities Somewhat in parallel with comments on financial incentives for investing in transmission capacity, the POST also received many comments onthe current difficulties associated with siting generation and transmission facilities. These comments described the many federal, state, and local decision-making bodies that affect siting decisions and the difficulties in working effectively with them. The basic challenge seems to be to ensure that the benefits from regional or more global solutions are shared adequately with individual, more narrowly defined, parochial interests. Many commenters concurred that improved regional coordination on siting issues is a high priority. Several recommended model state and local siting processes to be considered by otherjurisdictions. All acknowledged the difficulties in trying to apply these models in regional or multistate settings. Recommendations for appropriate federal actions to address siting fell into three areas. First, federal agencies themselves should better coordinate their activities. The U.S. Department ofEnergy and U.S. Environmental Protection Agency were explicitly mentioned in this context. Second, federal leadership in forming and supporting regional decision-making bodies would be helpful. (Some commenters werepessimistic, believing that such federal efforts would not be successful.) Third, federal support should be provided to develop probabilistic planning tools that could support regional planning activities. 

### A.2.4 State Public UtilityCommission Regulation of Electric Distribution : The POST received many comments about regulatory policies that affect the ' - reliability ofelectric distribution. The comments uniformly pointed out the primacy of state PUCs in overseeing and regulating the local distribution ofelectricity. Several observers, while acknowledging the POST review ofdistribution system outages in the summer of 1999, mentioned that state PUCs were conducting significant investigations of these outages and other ones not considered by the POST.

- -

A-5



### . A-5 -. "1'. " 

### EE-RM/STD-98-440-

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# . -:
Report of theDOEPower Outage Study Team on Electric ReliabilityEvents of the**Summe~** of1999
.**~** ; Thus, a bigger investment in transmission capacity to support increased trade would also' tend to increase system reliability. These commenters suggested that to a degree, the low levels ofinvestment in transmission capacity now simply reflect the uncertainties currently facing investorS. They indicated that hastening or smoothing the transition to competitive markets would largely address this issue. Some commenters mentioned that current earning opportunities are insufficient to support needed investments in transmission capacity. No suggestions for specific federal actions to address this issue were mentioned, beyond those already identified in Section A.I on the transition to competitive energy service markets. 

### A.2.3 Regional Coordination in Siting Generation and Transmission Facilities Somewhat in parallel with comments on financial incentives for investing·iIi transmission capacity, the POST also received many comments on**~he** current difficulties associated with siting generation and transmission facilities. These comments described the many federal, state, and local decision-making bodies that affect siting decisions and the difficulties in working effectively with them. The basic challenge seems to be to ensure that the benefits from regional or more global solutions are shared adequately with individual, more narrowly defined, parochial interests. Many commenters concurred that improved regional coordination on siting issues is a high priority. Several recommended model state and local siting processes to be
. considered by otherjurisdictions. All acknowledged the difficulties in tryingtoapply these models in regional ormultistate settings. Recommendations for appropriate federal actions to address siting fell into three areas. First, federal agencies themselves should bettercoordinate their activities. The U.S. Department ofEnergy and U.S. Environmental Protection Agency were explicitly mentioned in this context. Second, federal leadership in forming and supporting regionill. decision-making bodies would be helpful. (Some commenters were pessimistic, believing that such federal efforts would not be successful.) Third, federal support should be provided to develop probabilistic planning tools that could support regional planning activities
.. 

### A.2.4 State Public Utility Commission Regulation' of Electric Distribution The POST received many comments about regulatorypolicies that affect the reliability ofelectric distribution. The comments uniformlypointed outthe priniacy'of state PUCs in overseeing and regulating the local distribution ofelectri.city. Several" observers, while acknowledging the POSTreview ofdistribution system outages in the summer of 1999, mentioned that state PUCs were conducting significant investigations of· these outages and other ones not considered by the POST.

A-5 - ,',**~::.-** .

### EE-RM/STD-98-440 

## - / Report of theDOE Power OutageStudy Team onElectricReliabilityEvents of the Summer of1999


### Commenters advocated that the federal government not attempt to second guess . these efforts or seek a greater role in overseeing electric distribution system reliability. A few commenters requested national reliability standards for distribution, but many more: strongly urged the federal government to not propose a single, uniform set ofnational standards. (Additional, more detailed recommendations on appropriate federal actions to support state-led standard-setting for distribution system reliability are discussed in Section A.5 onreliability metrics, planning, and tracking.) Several commenters recommended appropriate federal actions to ensure the reliability ofthe electric distribution system, including the collection and dissemination ofdata on industry best practices. Commenters explicitly mentioned that federal support be given to national organizations that would represent state interests, such as the National Association ofRegulatory Utility Commissioners (NARUC), with regard to electric distribution system reliability issues. Support to encourage information sharing among states through organizations such as these was recognized as an important and valuable federal role. Specific forms ofinformation exchange could include the sharing ofsuccessful regulatory policies and practices (such as performance-based rate making and direct compensation to customers foroutages) from states and otherparts ofthe world. Federal support for efforts and information that would help remove regulatory and technical barriers to distributed generation and increase the role ofdemand-side participation were already mentioned in Section A.1.2 ofthis appendix. 

### A.3 Information Resources The POST received many comments related to federal actions that could be taken to address the accuracy and exchange ofinformation. The comments focussed on the following types ofinformation: (1)planning and load forecasting criteria, (2) generating unit capabilities, (3) T&D equipment availability and performance, and (4) cable testing techniques. Other forms ofinformation, including information to support market and real-time operations, public notification during system emergencies, and information on reliability metrics and "best practices," are discussed in other parts ofthis summary. 

### A.3.1 Planning and Load Forecasting Criteria The POST found that inaccurate load forecasts contributed to some ofthe events reviewed in the Interim Report. Comments related to this issue covered both the actual assumptions on which forecasts arebased andthe methods used todevelop the forecasts from these assumptions. Several commenters observed that many ofthe events that occurred in the summer of 1999 happened during record-breaking heat waves that had not been anticipated. Planning that was adequate for normal summer conditions was not adequate for such unusually hot weather. One commenter described how forecasts could be based on recent weather trends instead oflong-term averages in an effort to improve accuracy. Another commenter addressed a more global issue: What assumptions about weather severity should be used forreliability planning? This question was seconded by others,

A-6 ',' 

### EE-RM/STD-98-440

# -::IF**)3~**

# . '
Report ojthe DOEPower Outage Study Team on Electric Reliability Events ojthe Summer oj1999

"

, , -:. ". Commenters advocated that the federal government not attempt to**seco~d** guess these efforts or seek a greaterrole in overseeing electric distribution systemreliability. A, .... few commenters requested national reliability standards for distribution, butmaily more: ' strongly urged the federal government to notpropose a single, uniform set ofnational standards. (Additional, more detailed recommendations on appropriate federal actions to support state-led standard-setting for distribution system reliability are discussed in Section A.S on reliability metrics, planning. and tracking.) Several commenters recommended appropriate federal actions to ensure the reliability ofthe electric distribution system, including the collection and dissemination ofdata on industry best practices. Commenters explicitly mentioned that federal support be given to national organizations that would represent state interests, such as the National Association ofRegulatory Utility Commissioners (NARUC), with regard to electric distribution systemreliability issues. Support to encourage information sharing among states through organizations such as these was recognized as an important and valuable federal role. Specific forms ofinformation exchange could include the sharing "

, , .. " ofsuccessful regulatory policies and practices (such as performance-based rate making and direct compensation to customers for outages) from states and other parts ofthe world. Federal support for efforts and information that would help remove regulatory and technical barriers to distributed generation and increase the role ofdemand-side participation were already mentioned in Section A.I.2 ofthis appendix. 

### A.3 Information Resources The POST received many comments related to federal actions that couldbe taken to address the accuracy and exchange ofinformation. The comments focussed onthe following types ofinfonnation: (I) planning and load forecasting criteria, (2) generating, unit capabilities, (3) T&D equipment availability andperfoimance, and (4) cable testing techniques. Other forms ofinformation, including information to support market and real-time operations, public notification during system emergencies, and information on reliability metrics and "bestpractices," are discussed in otherparts ofthis summary. 

### A.3.1 Planning and Load Forecasting Criteria The POST found that inaccurate load forecasts contributed to some ofthe events reviewed in the InterimReport. Comments related to this issue covered both the actual assumptions on which forecasts are based and the methods used to develop the forecasts from these assumptions. Several commenters observed that many ofthe events that occurredin the summer of 1999 happened during record-breaking heat waves that hadnot been anticipated. Planning that was adequate for normal summer conditions was not adequate for such unusuallyhot weather. One commenter described how forecasts could be based on recent weathertrends instead oflong-term averages in an effortto improve accuracy. Another commenter addressed a more global issue: What assumptions about weather severity should be used for reliability planning? This question was seconded**by~thers,** ..

{.

, , "i_-' • --: . A-6

....

## EE-RM/STD-98-440 - 

# /
ReportoftheDOEPowerOutageStudy Team onElectricReliabilityEvents of the Summer of 1999


### who observed that increasing electric system reliability entails more costs, and these costs should be considered when the appropriateness ofany planning criterion is being determined. The cost ofreliability and society's willingness to pay for reliability 

### constitute a theme that surfaced throughout these discussions. Other commenters pointed out the need for better load forecasting techniques. One commenter expressed a specific interest in federal R&D to improve forecasting techniques for smaller geographic areas. Another mentioned the need to factor uncertainties explicitly into planning processes. 

### A.3.2 Generating Unit Capabilities The POST found that difficulties experienced by both PJM and Entergy were 

### exacerbated by inaccurate information about generating unit capabilities. In post-event studies, when more accurate data about these capabilities were used, the conditions that were experienced could be reproduced. Earlier studies based on inaccurate information had failed to predict these conditions. Commenters noted the need for (1) standardized definitions ofgenerator performance characteristics and (2) periodic verifications of generator capabilities. However, the commenters also suggested that market prices should 

### be counted on to provide adequate incentives to generators to maintain performance at levels they determine to be economic. 

### A.3.3 Transmission and Distribution Equipment Availability and Performance Several commenters referred to information on the availability and performance of T&D equipment. Some people expressed concerns that industry-organized forums for information exchange were inadequate. Even though competition among distribution and transmission system owners is essentially nonexistent (when compared with competition among generation system owners), this concern was strong, especially among firms that have not divested their generation assets. Several commenters suggested that there is a need for forums in which information on T&D equipment performance could be shared. Others mentioned that this type of 

### information is not widely available except from vendors, whose business interests could undermine confidence in the accuracy ofthe information. 

### Commenters suggested that a valuable role forthe federal government would be to support forums that promote the sharing ofinformation on equipment availability and performance. Web-based information exchange vehicles were mentioned. One 

### commenter mentioned that after Hurricane Hugo, common pieces ofdistribution equipment were labeled with unique identifiers to facilitate inter-firm exchanges. 

### Most commenters emphasized that the federal government needs to work with industry to develop appropriate information exchange forums. Others specifically cautioned the federal government against pre-empting private parties that might be able 

### to manage information exchanges without requiring taxpayer dollars. The issue of

A-7
.
. .A-7 

### EE-RM/STD-98-440

# ~~/3~ 

# ".'

Reportof theDOEPower Outage Study Team onElectricReliabilityEvents of the Summer of /999 •
who observed that increasing electric system reliability entails more costs, and these costs should be considered when the appropriateness ofany planning criterion is being determined. The cost ofreliability and society's willingness to pay for reliability constitute a theme that surfaced throughout these discussions
.. Othercommenters pointed outthe need for better load forecasting techniques. One commenterexpressed a specific interest in federal R&D to improve forecasting techniques for smaller geographic areas. Another mentioned the need to factor uncertainties explicitly into planning processes. 

### A.3.2 Generating Unit Capabilities The POSTfound that difficulties experienced by both PJM and Entergy were exacerbated by inaccurate information about generating unit capabilities. 

### In post-event studies, when more accurate data about these capabilities were used, the conditions that were experienced could be reproduced. Earlier studies based on inaccurate information had failed to predict these conditions. Commenters noted the need for (I) standardized· defmitions ofgenerator performance characteristics and (2) periodic verifications of generator capabilities. However, the commenters also suggested that market prices should be counted on to provide adequate incentives to generators to maintain performance at levels they determine to be economic. 

### A.3.3 Transmission and Distribution Equipment Availability and Performance Several commenters referred to information on the availability and performance of T&D equipment. Some people expressed concerns that industry-organized forums for· information exchange were inadequate. Even though competition among distribution and transmission system owners is essentially nonexistent (when compared with competition. among generation system owners), this concern was strong, especially among firms that have not divested their generation assets. Several commenters suggested that there is a need for forums in which infonnation on T&D equipment performance could be shared. Others mentioned that this type of information is not widely available except from vendors, whose business interests could undermine confidence in the accuracy ofthe information. Commenters suggested that a valuable role for the federal government would be 

### to support forums that promote the sharing ofinformation onequipment availability and'
.. performance. Web-based information exchange vehicles were mentioned. One commenter mentioned that after Hurricane Hugo, common pieces ()fdistribution equipment were labeled with unique identifiers to facilitate inter-firm exchanges. Most commenters emphasized that the federal government needs to workwith industry to develop appropriate information exchange forums. Others specifically cautioned the federal government against pre-empting private parties that might be able to manage information exchanges without requiring taxpayer dollars. The issue of**~"** A-7 . -." .'

### EE-RM/STD-98-440J^/3c3
Reportof theDOEPowerOutageStudy Team on ElectricReliabilityEvents ofthe Summer of 1999

-
information exchange is discussed further in Section A.5 onreliability metrics, planning, and tracking. 

### A.3.4 Cable Testing Techniques Several commenters discussed the sharing ofinformation on cable testing procedures. One commenter identified an existing industry forum for exchanging information on cable testing techniques and practices. Another indicated that the high potential testing method used in New York had been determined to be worthwhile, and that this determination had accounted for the fact that the testing itself might have caused damage. Several commenters mentioned that federal R&D might be appropriate in this area. 

### A.4 Operations Management and Emergency Response The POST received many comments on operations management and emergency procedures. They are grouped under the following headings: (1) emergency planning and operations, (2) training and certification, (3) T&D equipment availability, and (4) reliability-enhancing technologies. Some other comments in this area that address load forecasting and demand-side participation have already been discussed. Others that address best practices are discussed in Section A.5.2. 

### A.4.1 Emergency Planning and Operations Many commenters discussed emergency planning and operations. All ofthem supported the need for advanced plans to support emergency operations. Several described current approaches for testing and upgrading these plans on a regular basis. The involvement and coordination ofall affected parties were noted as a key element of successful plans. Clear, mutually agreed-upon, well-rehearsed protocols for actions, especially for public notification, are also essential. Some commenters noted that although all utilities have some form ofemergency plan, some ofthem lack systematic, on-going processes to review and update their plan. One commenter described factors that influence the effectiveness ofpublic notification procedures. Location is one factor; better responses were observed in rural areas. An increase in the frequency ofpublic appeals for emergency actions leads to a decrease in the effectiveness ofthese appeals.
. Some people suggested that federal assistance in coordinating emergency planning and operations among nonutility and utility parties would be valuable. One commenter cited the need to give utilities more flexibility in complying with federally mandated environmental restrictions during times of system restoration. Commenters made special mention ofthe need for assessment or audit procedures to help ensure that reliability-related planning and operating procedures are adequate. Of course, utilities and system operators routinely make advanced preparations topromote reliable operation. The day-ahead and season-ahead load forecasting and systemplanning

A-8

## EE.RM/STD.98.440-#/3~ . Report of the DOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of 1999
information exchange is discussed further in Section A.5 on reliability metrics, planning,
.. and tracking. 

### A.3.4 Cable Testing Techniques Several commenters discussed the sharing ofinfonnation on cable testing procedures. One commenter identified an existing industry forum for exchanging infonnation on cable testing techniques and practices. Another indicated that the high potential testing method used in New Yorkhad been determined to be worthwhile, and that this determination had accounted for the fact that the testing itselfmight have caused damage. Several commenters mentioned that federal R&D might be appropriate in this area. 

### A.4 Operations Management and Emergency Response

A-8 The POST received many comments on operations management and emergency procedures. They are grouped under the following headings: (1) emergencyplanning and operations, (2) training and certification, (3) T&D equipment availability, and (4) reliability-enhancing technologies. Some other comments in this area that address load forecasting and demand-side participation have already been discussed. Others that address best practices are discussed in Section A.5.2. 

### A.4.1 Emergency Planning and Operations Many commenters discussed emergency planning and operations. All ofthem supported the need for advanced plans to support emergency operations. Several described current approaches for testing and upgrading these plans on a regularbasis. The
. involvement and coordination ofall affected parties were noted as a key element of successful plans. Clear, mutually agreed-upon, well-rehearsed protocols for actions, especially for public notification, are also essential. Some commenters notedthat although all utilities have some fonn ofemergencyplan, some ofthem lack systematic, on-going processes to review and update theirplan.
. One commenter described factors that influence the effectiveness ofpublic notification procedures. Location is one factor; betterresponses were observed in 

### rural· areas. An increase in the frequency ofpublic appeals for emergency actions leads to a decrease in the effectiveness ofthese appeals. Some people suggested that federal assistance in coordinating emergencyplanning· and operations among nonutility and utility parties would be valuable. One commenter cited the need to give utilities more flexibility in complying with federaIiy mandated environmental restrictions during times ofsystem restoration.
. .. Commenters made special mention ofthe need for assessment or audit procedures to help ensure that reliability-related planning and operating procedures are adequate. Of course, utilities and system operators routinely make advanced preparations to promote . reliable operation. The day-ahead and season-ahead load forecasting and system plannirig
.

### EE-RM/STD-98-440 -44,/ 3 -^ ReportoftheDOEPowerOutageStudy Team on ElectricReliabilityEvents of the Summer of1999


### activities already discussed are examples ofsuch preparations. Moreover, NERC, through regional reliability councils, coordinates and integrates the reporting ofthese preparations. However, commenters suggested that even more thorough and standardized assessment procedures might be warranted. Formal reporting may also be required to complement or enhance existing reporting requirements. Federal support for improving and disseminating information onthese procedures may be needed. However, any federal support for these activities should be coordinated with the electric industry. 

### A.4.2 Training and Certification Commenters frequently mentioned the importance oftraining and certifying operating personnel throughout the electric generation, transmission, and distribution system. They expressed concern that the aging ofthe workforce, competition for workers from other industries, and business pressures to reduce operating costs had led to shortages ofadequately trained personnel, among other things. At least one commenter noted that many ofthe staffmembers who operate recently sold generating plants are, in fact, the same personnel who hadoperated these plants when they were part ofa full-service utility. Some commenters noted that the market incentives to operate plants reliably should ensure that plant personnel are appropriately trained and certified. Others stated that the independent generators do not have operatortraining programs similar to those previously provided by the full-service utilities and that there will soonbe a shortage ofqualified operators. Some commenters, while acknowledging that operating transmission systems reliably in a competitive market does create new needs for operator training and certification, nevertheless suggested that adequate incentives for reliable transmission system operation, rather than training and certification per se, ought to be the focus of attention. By implication, these comments could be extended to applyto distribution system operation. Several commenters observed that mature, industry-developed forums andprocesses for training and certification already exist. They suggested that an appropriate federal role would be to identify industry best practices for worker training and appropriate staffing levels. 

### A.4.3 Transmission and Distribution Equipment Availability In addition to being concerned about how information on T&D equipment availability and performance is exchanged (Section A.3.3), several commenters were concerned about the availability ofthis equipment. The lead times for obtaining large transformers can be very long, and transporting them often involves logistic hurdles. : One commenter wondered ifthe federal government should stockpile critical T&D equipment. Although this idea seems appealing, the commenter was concerned about the

.A-9 . .

# . EE-RM/STD-98-440_#

## I~' Reporto/theDOEPower Outage Study Team on ElectricReliabilityEvents of the Summerof J

999
activitiesalready discussed are examples ofsuch preparations. Moreover, NERC, through
...'.': .; .' regional reliability councils, coordinates and integrates the reporting ofthese
.. preparations
. However, commenters suggested that even more thorough and standardized assessment procedures might be warranted. Fonnal reporting may also be required to complement or enhance existing reporting requirements. Federal support for improving and disseminating information on these procedures maybe needed. However, any federal support for these activities should be coordinated with the electric industry. 

### A.4.2 Training and Certification Commenters frequently mentioned the importance oftraining and certifying operatingpersonnel throughout the electric generation, transmission, and distribution system. They expressed concern that the aging ofthe workforce, competition for workers from other industries, and business pressures to reduce operating costs had ledto shortages ofadequately trained personnel, among other things. At least one commenter noted that many ofthe staffmembers who operate recently sold generating plants are, in fact, the same personnel who had operated these plants when they were part ofa full-service utility. Some commenters noted that the market incentives to operate plants reliably should ensure that plantpersonnel are appropriately trained and certified. Others stated that the independent generators do not have operatortraining programs similarto those previously provided bythe full-service utilities and
. that there will soon be a shortage ofqualified operators. .' Some commenters, while acknowledging that operating transmission systems reliably in a competitive market does create new needs for operator training and certification, nevertheless suggested that adequate incentives for reliable transmission system operation, rather than training and certification per se, ought**t~** be the focus of attention. By implication, these comments could be extended to applyto distribution system operation. Several commenters observed that mature, industry-developed forums and processes for training and certification already exist. They suggested that an appropriate federal role. would be to identify industry bestpractices for workertraining and appropriate staffmg levels. 

### A.4.3 Transmission and Distribution Equipment Availability In addition to being concerned about how information onT&D equipment availability and perfonnance is exchanged (Section A.3.3), several con;unenterswere concerned about the availability ofthis equipment. The lead times for obtaining large transfonners can be very long, and transporting them often involves logistic hurdles.
. . One commenter wondered ifthe federal government should stockpile critical T&D equipment. Although this idea seems appealing, the commenter was concerned about the

### EE-RM/STD-98-440 -/jR/-

- ReportoftheDOE PowerOutageStudy Team onElectricReliabilityEvents of the Summerof1999
commercial implications ofsuch an endeavor and suggested managing such stockpiles may not be appropriate for the federal government. 

### A.4.4 Reliability-Enhancing Technologies Several commenters offered suggestions that would support an increased reliance on 

### technologies and further development ofreliability-enhancing technologies. One offered a radical vision for a future transmission system, in which the current, highly interconnected power systems ofthe East and West Coasts would be broken into smaller systems through the use ofdirect-current transmission and flexible alternating-current transmission system (FACTS) technologies. These technologies would allow systems to remain interconnected to support power flows between regions. However, they would also electrically insulate one system from disturbances and thus localize reliability problems. 

### As mentioned above, others commented more broadly on the appropriate federal role in this area. They suggested that the federal government should limit its role to supporting the development ofincentives that will encourage market participants to make their own investments in reliability-enhancing technologies. One commenter specifically cautioned the federal government against embracing a single national standard forcontrol area operations, such as data management protocols and advanced applications. This commenter suggested that the federal government should respect the fact that some systems in the United Stateshave already made substantial investments in these technologies. The federal government should articulate clearly the objectives that mustbe met, then allow the industry to determine the best means for meeting them. Other commenters did identify specific federal R&D priorities in support ofmore reliable tools and technologies. Improved load forecasting, probabilistic planning, and cable testing tools and techniques have already been mentioned in other sections ofthis appendix. There is also a need for federal support ofbasic R&D to develop and demonstrate (1) technologies that can respond flexibly to load growth (including storage 

### and distributed generation) and (2)modeling tools that can more accurately capture the system reliability impacts ofinduction motors. Commenters emphasized the need to coordinate federal activities with existing industry-led activities. 

### A.5 Reliability Metrics, Planning, and Tracking Comments on the topic ofreliability metrics, planning, and tracking are grouped 

### under three broad headings: (1)reliability metrics and benchmarking, (2) best practices, and (3) federal reliability reporting. 

### A.5.1 Reliability Metrics and Benchmarking Effective reliability management depends on clear articulation ofobjectives

. " 

### Performance can then be measured against these objectives through the use ofmetrics. A

A-10 

### EE-RM/STD-98-440

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Reportof the DOEPower Outage Study Team on Electric ReliabilityEvents of the Summer of 1999
commercial implications ofsuch an endeavor and suggested managing suchstockpiles, may not be appropriate for the federal government. 

### A.4.4 Reliability-Enhancing Technologies Several commenters offered suggestions that would support an'increased reliance on ' technologies and further development ofreliability-enhancing technologies. One offered a radical vision for a future transmission system, in which the current, highly interconnected power systems ofthe East and West Coasts would be broken into smaller systems through the use ofdirect-current transmission and flexible alternating-current transmission system (FACTS) technologies. These technologies would allow systems to remain interconnected to support power flows between regions. However, they would also electrically insulate one system from disturbances and thus localize reliability problems. As mentioned above, others commented more broadly on the appropriate federal role in this area. They suggested that the federal government should limit its role to supporting the development ofincentives that will encourage marketparticipants to make their own investments in reliability-enhancing technologies. One commenter specifically cautioned the federal governinent against embracing a single national standard for control area operations, such as data management protocols ' and advanced applications. This commenter suggested that the federal government should respect the fact that some systems in the United States have alreadymade substantial investments in these technologies. The federal government should articulate clearly the objectives that must be met, then allow the industry to determine the best means for meeting them. Other commenters did identify specific federal R&D priorities in support o(more reliable tools and technologies. Improved load forecasting, probabilistic planning, and cable testing tools and techniques have already been mentioned in other sections ofthis appendix. There is also a need for federal support ofbasic R&D to develop and demonstrate (1) technologies that can respond flexibly to load growth (including storage and distributed generation) and (2) modeling tools that can more accurately capture the system reliability impacts ofinduction motors. Commenters emphasized the needto coordinate federal activities with existing industry-led activities. 

### A.S Reliability Metrics, Planning, and Tracking

A-lO Comments on the topic ofreliability metrics, planning, and tracking are grouped underthree broad headings: (1) reliability metrics and benchmarking, (2) best practices, and (3) federal reliability reporting. ' 

### A.S.1 Reliability Metrics and Benchmarking Effective reliability management depends on clear articulation ofobjectives. '. Performance can then be measured against these objectives through the use ofmetrics. A

........ ,',

',.':

:.=:"

### EE-RM/STD-98-440go - $

- Reportof theDOE PowerOutageStudy Team onElectricReliabilityEvents of the Summer of1999 

### wide variety ofreliability metrics are in use today. Several commenters suggested that ' :. additional standardization ofsome definitions is needed so comparisons can be made. They also suggested that federal support forthese efforts would be helpful. .- Other commenters cautioned that comparisons ofutilities onthe basis ofreliability metrics alone could be misleading. The conditions associated with various electric systems can be quite different, rendering simple comparisons meaningless. For example, vegetation, population density, and weather severity are important conditions that must be accounted for ifcomparisons are to be meaningful. One commenter described how a company used company-specific benchmarks (further disaggregated by regions within its service territory) in an effort to control forthese differencesjust for its own use (rather than for comparisons with other utilities). Many commenters spoke forcefully against establishing a single national standard - .- for reliability. In addition to mentioning physical conditions, they also highlighted the fact that distribution reliability falls under thejurisdiction ofstate and local authorities and is more appropriately regulated by them. Other commenters pointed outthat service reliability (and quality) standards do not yet exist in alljurisdictions. They thought the federal government couldplay a valuable role in supporting thesejurisdictions in their efforts to establish standards. They mentioned the newly established Reliability Subcommittee in NARUC as one venue through which federal support mightbe provided. Several commenters, while supporting the sharing ofperformance information through the use ofstandardized reliability metrics, also acknowledged the challenges of using this information. NARUC was again mentioned as an organization through which

- federal support might be directed. Finally, some commenters observed that the use ofreliability metrics makes sense only for frequent events from which reliable statistical trends can be extracted. Many of the most severe outages and troublesome events occur only rarely. Different analytical techniques, such as root cause analysis, are more appropriate for reviewing these events. 

### A.5.2 Best Practices. - The POST received a variety ofcomments on the subject ofbest practices. Some have already been discussed in other sections ofthis summary. This section extends and :*--- integrates these discussions to capture abroader perspective on this issue.. What are best practices? Some commenters suggested that best practices could be: expressed directly in metrics (e.g., labor-hours fora given task or minimum staffing requirements for certain functions). Other commenters warned that using metrics to express best practices could make the definitions obsolete as technologies and procedures improve. Metrics mustbe reviewed and revised regularly to capture improvements. Other comments suggested that it is more important to articulate clearly the performance

A- 1

.

## EE.RM/STD.98.440.;.....~/...3=:< "
Report of the DOEPower Outage Study Team onElectricReliabilityEvents of the Summer of 1999
wide variety ofreliability metrics are in use today. Several commenters suggested that ' additional standardization ofsome defInitions is needed so comparisons can be made. They also suggested that federal support for these efforts wouldbe helpful. Other commenters cautioned that comparisons ofutilities on the basis ofreliability metrics alone could be misleading. The conditions associated with various electric systems can be quite different, rendering simple comparisons meaningless. Forexample, vegetation, population density, and weather severity are important conditions that must be accounted for ifcomparisons are to be meaningful. One commenter described how a company used company-specifIc benchmarks (further disaggregated by regions within its service territory) in an effort to control for these differencesjustfor its own use (rather than for comparisons with otherutilities). Many commenters spoke forcefully against establishing a single national standard for reliability. 

### In addition to mentioning physical conditions, they also highlighted the fact that distribution reliability falls under thejurisdiction ofstate and local authorities and is more appropriately regulated by them. Other commenters pointed out that service reliability (and quality) standards do not yet exist in alljurisdictions. They thought the federal government couldplayavaluable role in supporting thesejurisdictions in their efforts to establish standards. They mentioned the newly established Reliability Subcommittee in NARUC as one venue through which federal support might be provided Several commenters, while supporting the sharing ofperformance information through the use ofstandardized reliability metrics, also acknowledged the challenges of using this information. NARUC was again mentioned as an organization through which federal support might be directed. Finally, some commenters observed that the use ofreliability metrics makes sense only for frequent events from which reliable statistical trends canbe extracted. Many of the most severe outages and troublesome events occur only rarely. Different**analyti~l** techniques, such as root cause analysis, are more appropriate for reviewing these events. 

### A.S.2 Best Practices The POST received a variety ofcomments on the subject ofbest practices. Some ' have already been discussed in other sections ofthis summary. This section extends and, integrates these discussions to capture a broaderperspective on this issue. What are best practices? Some commenters suggested that best practices couldbe' expressed directly in metrics (e.g., labor-hours for a given task orminimum staffing requirements for certain functions). Othercommenters warned that using metricstO express best practices could make the defInitions obsolete as technologies andprocedures

.improve. Metrics must be reviewed and revisedregularly to capture improvements. Other, ; comments suggested that it is more important to articulate clearly the performance' ' 

# A-n '" ..

"
, 

## .

### EE-RM/STD-98-440 Reportof the DOEPowerOutageStudy Team on ElectricReliabilityEvents of the Summer of 1999 

### objectives being soughtwithout referring to the specific steps to be taken to achieve them. Many commenters spoke ofthe need to ensure that effective mechanisms for sharing - 

### information onbest practices are available. Several ofthem mentioned existing industryled organizations, such as Edison Electric Institute and NERC, as candidates for coordinating information flow. The development offederal actions forsharing information onbest practices should be coordinated with these and other existing forums. Concerns.about the commercial value ofinformation on best practices were expressed. Although these concerns might be significant with regard to generating units, they should be smaller with regard to T&D planning and operations. In fact, as mentioned in Section A.3.3 on information resources for T&D equipment performance, the absence ofreliable and easily accessed information onbest practices in some areas hinders wider adoption ofthese practices. Commenters strongly supported the notion that the implementation ofbest practices should be seen as an outcome ofissues discussed under Section A.2 on regulation for reliable transmission and distribution. They suggested that an appropriate federal role would be to support the collection and dissemination ofdata onbest practices, especially in the area ofT&D reliability. 

### A.5.3 Federal Reliability Reporting Several commenters addressed current federal requirements forreporting reliability events. One commenter suggested that low compliance with federal requirements was the result of(1)perceptions that the thresholds for reporting were arbitrary, (2) the lack of meaningful sanctions (or the lack ofenforcement ofsanctions) for failures to report, and (3) perceptions that federal reporting requirements are less important than the reporting requirements oflocal regulatory bodies and regional reliability councils. Commenters suggested that the federal government revisit current reporting requirements to ensure that they are appropriate for federal uses ofthe data.

A-12

. . I A 1..* : , ' . .



### A-12 "-..

# EE.RM/STD~98.440ffI3~-_ - Reporto/theDOEPower Outage Study Team on Electric ReliabilityEvents o/theSummer 0/1999 objectives being sought without referring to the specific steps to be taken to achieve them. Many commenters spoke ofthe need to ensure that effective mechanisms for sharing information on best practices are available. Several ofthemmentioned existing industry-
... led organizations, such as Edison Electric Institute and NERC, as candidates for coordinating information flow. The development offederal actions for sharing infonnation on best practices should be coordinated with these and other existing forums. Concerns.about the·commercial value ofinformation onbestpractices were expressed. Although these concerns might be significant with regard to generating units, they shouldbe smaller with regard to T&D planning and operations. In fact, as mentioned in Section A.3.3 on information resources for T&D equipmentperfonnance, the absence ofreliable and easily accessed information on best practices in some areas hinders wider
_ adoption ofthese practices.

- Commenters strongly supported the notion that the implementation ofbestpractices should be seen as an outcome ofissues discussed under Section A.2 onregulation for reliable transmission and distribution. They suggested that an appropriate federal role would be to support the collection and dissemination ofdata onbestpractices, especially in the area ofT&Dreliability. 

### A.S.3 Federal Reliability Reporting Several commenters addressed current federal requirements for reportingreliability events. One commenter suggested that low compliance with federal requirements was the
. result of

### (1) perceptions that the thresholds for reporting were arbitrary, (2) the lack of meaningful sanctions (or the lack ofenforcement ofsanctions) for failures to report, and (3) perceptions that federal reporting requirements are less important than the reporting requirements oflocal regulatory bodies and regional reliability councils. Conunent.ers suggested that the federal government revisit current reporting requirements to ensure that they are appropriate for federal uses ofthe data.

: .; A-12 .. - .:.'

.. .,"--

### EE-RM/STD-98-440 a 

# Appendix B Glossary

This glossary provides definitions of some ofthe terms listed in the Notation list as well as many others used throughout the report and some others that are related to the field but not expressly mentioned. In the text ofthis report, terms that are defined in the glossary appear in italics the first time they are used. Adequacy - Ability ofthe electric system to supply the aggregate electrical demand and energy requirements ofcustomers at all times, taking into account scheduled and reasonably expected unscheduled outages ofsystem elements. Ancillary Services - A number offunctions, such as reserves andreactive power, that are necessary to support operations ofthe transmission system. ApparentPower - Product ofthe volts and amperes. It comprises both realand'
. 

### reactivepower, usually expressed in kilovolt-amperes (kVA) or megavolt-amperes (MVA). Availability - Measure oftime that a generating unit, transmission line, or other facility is capable ofproviding service, whether or not it actually is in service. Typically, this measure is expressed as a percent available forthe period under consideration.

- Bulk-power System -The portion ofan electric power system that encompasses the generation resources, system control, and high-voltage transmission system. Capability - see Installed Capability and Operable Capability. Capacity - The rated continuous load-carrying ability, expressed in megawatts (MW), megavolt-amperes (MVA), or megavolt-amperes-reactive (MVAR) ofgeneration, transmission, or other electrical equipment. Cascading

- Uncontrolled successive loss ofsystem elements triggered by an incident at any location. Cascading results in widespread service interruption, which cannotbe restrained from sequentially spreading beyond an area predetermined by appropriate studies. Clearing Price- see Energy Clearing Price. Contingency - Unexpected failure or outage ofa system component, such as a generator, transmission line, circuit breaker, switch, or other electrical element. A. contingency also may include multiple components, which are related by situations leading to simultaneous component outages.

- ' B- ' : 1 : 

### EE-RM/STD-9B;.440

# # 

# 13b<,,',

- '", - - 

### .. - 

# Appendix B ','" Glossary

This glossary provides defInitions ofsome ofthe terms listed in the Notation list as well as many others'used throughout the report and some others that are related to the fIeld butnot expressly mentioned. Inthe text ofthis report, terms that are defIned in the glossary appear in italics the fIrst time they are used. Adequacy

- Ability ofthe electric system to supply the aggregate electrical demand and energy requirements ofcustomers at all times, taking into account scheduled and reasonably expected unscheduled outages ofsystem elements. AnciUary Services - A number offunctions, such as reserves andreactive power, that are necessary to support operations ofthe transmission system. Apparent Power

- Product ofthe volts and amperes. It comprises both real and reactive power, usually expressed in kilovolt-amperes (kVA) ormegavolt-amperes (MYA). Availability

- Measure oftime that a generating unit, transmission line, orother facility is capable ofproviding service, whether ornot it actually is in service. Typically, this measure is expressed as a percent available for the period under consideration. ''.

# ,> ' Bulk-power System

- The portion ofan electric power systemthat encompasses'the generation resources, system control, and high-voltage transmission system. Capability

- see Installed Capability and Operable Capability. Capacity

- The rated continuous load-carrying ability, expressed in megawatts (MW), megavolt-amperes (MY A)', ormegavolt-amperes-reactive (MY AR) ofgeneration, transmission, orotherelectrical equipment. Cascading

- Uncontrolled successive loss ofsystem elements triggered by an incident at any location. Cascadingresults in widespread service interruption, which cannot

### be restrained from sequentially spreading beyond an area predeterminedby appropriate ' studies. ' ClearingPrice

- see Energy Clearing Price. Contingency

- Unexpected failure oroutage ofa system component, such as a generator, transmission line, circuitbreaker, switch, orotherelectrical element. A , contingency also may include multiple components, which are relatedby situations leading to simultaneous component outages. ' . ;. 

# - f

## EE-RM/STD-98-440 

# -4
ReportoftheDOEPower OutageStudy Team on ElectricReliabilityEvents of the Summer of 1999
Control Area -Electric system or systems, bounded by interconnection metering and telemetry, capable ofcontrolling generation to maintain its interchange schedule with other control areas and contributing to frequency regulation ofthe interconnection. Curtailment- Reduction in the scheduled capacity or energy delivery. Demand-Side Management - Programs that affect customer use ofelectricity, both the timing (sometimes referred to as load management) and the amount (sometimes referred to as energy efficiency). Dispatch - Operating control ofan integrated electric system involving operations such as assignment oflevels ofoutput to specific generating stations and other sources of supply; control oftransmission lines, substations, and equipment; operation ofprincipal interties and switching; and scheduling ofenergy transactions. Distribution Network- A network ofelectrical lines from a substation (which is the terminus ofthe transmission network) to a series oftransformers (and eventually to the ultimate customer). Distribution System

- Portion ofan electric system that "transports" electricity from the bulk-power system to retail customers, consisting primarily oflow-voltage lines and transformers. Disturbance

- Unplanned event that produces an abnormal system condition. Electrical Energy - The generation or use of electric power by a device over a period oftime, expressed in kilowatt-hour (kWh), megawatt-hour (MWh), or gigawatt-hour (GWh). Electric System or Electric Power System

- An interconnected combination of generation, transmission, and distribution components that make up an electric utility, an electric utility and one or more independent power producers (IPPs), or group ofutilities and one or more IPPs. Electric Utility

- Corporation, person, agency, authority, or other legal entity or instrumentality that owns or operates facilities forthe generation, transmission, distribution, or sale ofelectric energy primarily for use by thepublic and is defined as a utility under the statutes and rules by which it is regulated. An electric utility can be investor-owned, cooperatively owned, or government-owned (owned by a federal agency, crown corporation, state, provincial government, municipal government, and public power district). Emergency

- Any abnormal system condition that requires automatic or immediate manual action to prevent or limit loss oftransmission facilities or generation supply that could adversely affect the reliability ofthe electric system.

B-2 

### EE-RM/STD-98-440

# -4f:::-1**~** Report of the DOEPower Outage Study Team on Electric ReliabilityEvents of the Summer of 1999
Control Area

- Electric system or systems, bounded by interconnection metering and
.. telemetry, capable ofcontrolling generation to maintain its interchange schedulewith other control areas and contributing to frequency regulation ofthe interconnection. Curtailment

- Reduction in the scheduled capacity or energy delivery. Demand-SideManagement

- Programs that affect customer use ofelectricity, both the timing (sometimes referred to as load management) and the amount (sometimes referred to as energy efficiency). Dispatch

- Operating control ofan integrated electric system involving operations such as assignment oflevels ofoutput to specific generating stations and other sources of supply; control oftransmission lines, substations, and equipment; operation ofprincipal interties and switching; and scheduling ofenergy transactions. Distribution Network

- A network ofelectrical lines from a substation (whichis the terminus ofthe transmission network) to a series oftransformers (and eventually to the ultimate customer). Distribution System

- Portion ofan electric system that "transports" electricity from the bulk-power system to retail customers, consisting primarily oflow-voltage lines and transformers. Disturbance

- Unplanned event that**produc~s** an abnormal system condition. ". '- ".

Electrical Energy

- The generation oruse ofelectric powerby a device over a period
. . . ...

B-2 oftime, expressed in kilowatt-hour (kWh), megawatt-hour (MWh), orgigawatt-hour
. (GWh). Electric System or Electric Power System

- An interconnected combination of generation, transmission, and distribution components that make up an electric utility, an electric utility and one or more independent powerproducers (IPPs), or group ofutilities and one ormore IPPs. Electric Utility

- Corporation, person, agency, authority, orother legal entity or instrumentality that owns oroperates facilities for the generation, transmission, distribution, or sale ofelectric energyprimarily for use by the public and is defined as 

## a utility underthe statutes and rules bywhich it is regulated. An electric utility caD 

### be investor-owned, cooperatively owned, orgovernment-owned (owned bya federal agency,'
.. crown corporation, state, provincial government, municipal government,.and public power district). Emergency

- Any abnormal system condition that requires automatic orirnrnedlate manual action to prevent or limit loss oftransmission facilities or generation supply tha.t • could adversely affect the reliability ofthe electric system.

-**.~** . -:-,' - ....

- -

### EE-RM/STD-98-440

_ /5^? -. ReportoftheDOEPowerOutageStudy Team onElectricReliabilityEvents of the Summerof 1999 

### Energy Clearing Price

- Theprice at which the market is able to matchthe last unit of energy a specific seller is willingto sell with the lastunit ofenergy a specific purchaser is willing to buy. '. ' Federal Energy Regulatory Commission (FERC)- Independent federal agency within the U.S. Department ofEnergy that, among otherresponsibilities, regulates the transmission and wholesale sales ofelectricity in interstate commerce. FirmPower orPurchase- Power or power-producing capacity intended tobe available at all times during the period covered by a guaranteed commitment to deliver, even under adverse conditions. Forced Outage - Removal from service availability ofa generating unit, transmission line, or other facility foremergency reasons or a condition in which the equipment is unavailable because ofunanticipated failure. Frequency - Rate, in cycles per second (or Hertz, Hz), at which voltage and current oscillate in electric power systems. Thereference frequency in North American Interconnections is 60 Hz. Generation Reserves - see Reserve. 

### Generating Unit -An electric generator together with its prime mover (e.g., steam from boiler). 

### Grid - System ofinterconnected power lines and generators that is managed so that the generators are dispatched as needed to meet the requirements ofthe customers connected to the grid at various points. Gridco is sometimes used to identify an independent company responsible forthe operation ofthe grid. Independent System Operator(ISO)- A neutral operator responsible for maintaining the generation-load balance ofthe system in real time. The ISO performs its function by monitoring and controlling the transmission system and some generating units to ensure that generation matches loads. Installed Capability- Seasonal (i.e., winter and summer) maximum load-carrying ability ofa generating unit, excluding capacity required for station use. , Interconnection - When capitalized, any one ofthe major electric system networks in North America. When not capitalized, the facilities that connect two systems or control . areas. In addition, an interconnection refers to the facilities that connect a nonutility generator to a control area or system. InterruptibleRate - Electricity rate that, in accordance with contractual arrangements, allows interruption ofconsumer load by direct control ofthe utility system operator or by action ofthe consumer at the direct request ofthe system operator. It usually involves - commercial and industrial consumers. In some instances, the load reduction may be

'-B-3

# EE.RM/STD.98-440_tF-13~'. : Report of theDOEPower Outage Study Team onElectn"c ReliabilityEvents of the Summer of /999 Energy ClearingPrice

- The price at which the market is able to match the iast unit of energy a specific seller is willing to sell with the lastunit ofenergy a specific purchaseris, willing to buy. Federal Energy Regulatory Commission (FERC)-Independentfederal agency within the U.S. Department ofEnergy that, among otherresponsibilities, regulates the transmission and wholesale sales ofelectricity in interstate commerce. Firm Power orPurchase

- Power orpower-producing capacity intended to be available at all times during the period covered by a guaranteed commitment to deliver, even under adverse conditions. Forced Outage

- Removal from service availability ofa generating unit, transmission line, orother facility for emergencyreasons or a condition in which the equipment is unavailable because ofunanticipated failure. Frequency

- Rate, in cycles per second (orHertz, Hz), at which voltage and current oscillate in electric power systems. The reference frequency in North American Interconnections is 60 Hz. Generation Reserves

- see Reserve. GeneratingUnit

- 

### An electric generator together with its prime mover (e.g., steam from boiler). Grid

- System ofinterconnected power lines and generators that is managed so that the generators are dispatched as needed to meet the requirements ofthe customers connected to the grid at various points. Gridco is sometimes used to identify

# an independent company responsible for the operation ofthe grid. Independent System Operator (ISO) - A neutral operatorresponsible for maintaining the generation-load balance ofthe system in real time. The ISO performs its function by monitoring and controlling the transmission system and some generating units to ensure that generation matches loads. Installed Capability- Seasonal (i.e., winter and summer) maximum 'load-c3rrymg ability ofa generating unit, excluding capacity required for stationuse.' Interconnection

- When capitalized, anyone ofthe major electric system networks in North America. When not capitalized, the facilities that connecttwo systems orcontrol" areas. In addition, an interconnection refers to the facilities that connect a nonutility generator to a control area or system. Interruptible Rate

- Electricity rate that, in accordance with contractual arrangements, , allows interruption ofconsumer load by direct control ofthe utility system operator or

## py, action ofthe consumer at the direct request ofthe system operator. It usually involves
. commercial and industrial consumers. In some instances, the load reduction may be '':, "
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### ...

. ,".

### EE-RM/STD-98-440-8-&/4/$ 3 ReportoftheDOE Power OutageStudy Team on ElectricReliabilityEvents of the Summer of1999

- - . 

### affected by direct action ofthe system operator (remote tripping) after notice to the

- - 

### consumer in accordance with contractual provisions. Load -A consumer ofelectric energy; also the amount ofpower (sometimes called demand) consumed by a utility system, individual customer, orelectrical deviceLoad Pocket

- Geographical area in which electricity demand sometimes exceeds local generation capability and in which there is an electricity import limitation as a result of transmission constraints. Load Shedding - The process ofdeliberately removing (either manually or automatically) preselected customer demand from apower system inresponse to an abnormal condition in order to maintain the integrity ofthe system and minimize overall customer outages. Market Clearing Price ofElectricity

- see Energy Clearing Price. Marketers - Commercial entities that buy and sell electricity. Must-Run Resources

- Generation designated to operate at a specific level and not available fordispatch. Network Distribution- Method ofdistributing electric power to a densely populated area, where a network or grid oflow-voltage conductors covers an area ofseveral city blocks to a few square miles. The grid is solidly connected and is fed from multiple distribution feeders. Nonfirm Capacity, Power, or Purchase

- Power or power-producing capacity. supplied or available under a commitment having limited orno assured availability. Nonspinning Reserve - Generation capacity that is not beingutilized but that can be activated and used to provide assistance with little notification. NorthAmerican Electric Reliability Council (NERC)

- A not-for-profit company formed by the electric utility industry in 1968 to promote the reliability ofthe electricity supply in North America. NERC consists of 10 Regional Reliability Councils and one Affiliate whose members account for virtually all the electricity supplied in the United States, Canada, and a portion ofBaja California Norte, Mexico. The members ofthese Councils are from all segments ofthe electricity supply industry -investor-owned, ': federal, rural electric cooperative, state/municipal, and provincial utilities, independent power producers, andpower marketers. The 10 NERC Regional Reliability Councils are East Central Area Reliability Coordination Agreement, Electric Reliability Council of Texas, Florida Reliability Coordinating Council, Mid-Atlantic Area Council, Mid-. America Interconnected Network, Mid-Continent Area Power Pool, Northeast Power Coordinating Council, Southeastern Electric Reliability Council, Southwest Power Pool, and Western Systems Coordinating Council. The Affiliate is the Alaskan Systems Coordination Council.
.
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## EE-RM/STO-9S-44o--# /

# ~,:~ ,,' Reportof the DOEPower Outage Study Team on Electric ReliabilityEvents of the Summer of 1999

B-4 affected by direct action ofthe system operator (remote tripping) afternotice to the ' consumer in accordance with contractual provisions, Load- A consumer ofelectric energy; also the amount ofpower (sometimes call,ed demand) consumedby a utility system, individual customer, orelectrical device', "



### - '..

Load Pocket

- Geographical area in which electricity demand sometimes exceeds local generation capability and in which there is an electricity import limitation as a result of transmission constraints. Load Shedding

- The process ofdeliberately removing (either manually or automatically) preselected customer demand from a power system in response to an abnormal condition in orderto maintain the integrity ofthe system and minimize overall customer outages. Market Clearing Price ofElectricity

- see Energy Clearing Price. Marketers

- Commercial entities that buy and sell electricity. Must-Run Resources

- Generation designated to operate at a specific level and not available for dispatch. NetworkDistribution

- Method ofdistributing electric powerto a densely populated, area, where a network or grid oflow-voltage conductors covers an area ofseveral city blocks to a few square miles. The grid is solidly connected and is fed from multiple distribution feeders. Nonfirm Capacity, Power, or Purchase

- Powerorpower-producing capacity , supplied or available under a commitment having limited orno assured availability. Nonspinning Reserve

- Generation capacitythat is not bemgutilizedbutthat can be activated and used to provide assistance with little notification. North American Electric Reliability Council (NERC) - A not-for-profit company formed by the electric utility industry

### in 1968 to promote the reliability ofthe electricity
. supply in North America. NERC consists of 10 Regional Reliability Councils arid one Affiliate whose members account for virtually all the electricity supplied in the United States, Canada, and a pOItion ofBaja California Norte, Mexico. The members ofthese Councils are from all segments ofthe electricity supply industry

- investor-owned, federal, rural electric cooperative, state/municipal, and provincial utilities, independent powerproducers, andpowermarketers. The 10 NERC Regional Reliability Councils are' , " East Central Area Reliability Coordination Agreement, Electric Reliability Council of Texas, Florida Reliability Coordinating Council, Mid-Atlantic Area Council, Mid- , America InterconnectedNetwork, Mid-Continent Area PowerPool, Northeast Power Coordinating Council, Southeastern Electric Reliability Council, Southwest Power

## Pooi, and Western'Systems Coordinating Council. TheAffiliate is the Alaskan Systems Coordination Council. , "

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### EE-RM/STbD98-440 .- 43» ~.~- l r1 = . a. _- . · .- .

Report of theDOEPowerOutageStudy Team on ElectricReliabilityEvents of the Summer of 1999 

### Open-Access Same-Time Information System (OASIS)

- An electronic posting system for transmission access data that allows all transmission customers to view the data simultaneously. Operable Capability-The portion ofinstalled capability ofa generating unit that isin operation or available to operate in the hour. Operating Reserve- That capability above firm system demand required toprovide for regulation, load forecasting error, equipment forced and scheduled outages, and local area protection. It includes both spinning and nonspinning reserve. Peak Demand orLoad - The greatest demand that occurs during a specified period of time. Power Pool - Entity established to coordinate short-term operations to maintain system stability and achieve least-cost dispatch. The dispatch provides backup supplies, shortterm excess sales, reactive power support, and spinning reserve. Historically, some of these services were provided on an unpriced basis as part ofthe power pool members' utility franchise obligations. Coordinating short-term operations includes the aggregation and firming ofpower from various generators, arranging exchanges between generators, and establishing (orenforcing) the rules ofconduct for wholesale transactions. The pool may own, manage, and/or operate the transmission lines (i.e., wires) or be an independent entity that manages the transactions between entities. Often, the power pool is not meant to provide transmission access and pricing or to provide settlement mechanisms if differences between contracted volumes among buyers and sellers exist. Reactive Power - Portion ofelectricity that establishes and sustains the electric and magnetic fields ofalterating-current equipment. Reactive power must be supplied to most types ofmagnetic equipment, such as motors and transformers. It also must supply the reactive losses ontransmission facilities. Reactive power is provided by generators, synchronous condensers, orelectrostatic equipment such as capacitors and directly influences electric system voltage. It is usually expressed in kilovars (kVAR) or megavars (MVAR). Real Power

- Rate ofproducing, transferring, or using electrical energy, usually expressed inkilowatts (kW) or megawatts (MW). Reliability - Degree ofperformance ofthe elements ofthe bulk-power system that results in electricity being delivered to customers within accepted standards and in the amount desired. Reliability may be measured by the frequency, duration, and magnitude ofadverse effects on the electric supply. Electric system reliability can be addressed by considering two basic and functional aspects ofthe electric system -adequacy and security. 

### Reserve -Electric power generating capacity in excess ofthe system load projected for a given timeperiod. It consists oftwo sources: spinningreserve and supplemental reserve. -'" ' . * ': '- *~~~~~~~~~~~~~~_ .

# ' . -,..'
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Reportof the DOEPower Outage Study Team on ElectricReliabilityEvents of theSummerof 1999 Open-Access Same-Time Information System (OASIS)

- An electronic posting system for transmission access data that allows all transmission customers 

### to view the data simultaneously. Operable Capability

- The portion ofinstalled capability ofa generatingunit 

### that is 

### in' .' operation or available to operate in the hour. Operating Reserve

- That capability above 

### firm system demand required 

### to provide for regulation, load forecasting error, equipment forced and scheduled outages, and local area protection. It includes both spinning and nonspinning reserve. PeakDemand or Load

- The**gr~test** demand that OCcurs during a specified period of time. PowerPool

- Entity established to coordinate short-term operations to maintain system stability and achieve least-cost dispatch. The dispatch provides backup supplies, short-
. term excess sales, reactive power support, and spinning reserve. Historically, some of these services were provided on an unpriced basis as part ofthe powerpool**members~** utility franchise obligations. Coordinating short-term operations includes the aggregation and firming ofpowerfrom various generators, arranging exchanges between generators, and establishing (or enforcing) the rules ofconduct for wholesale transactions. The pool
. may own, manage, and/oroperate the transmission lines (i.e., wires) orbe an independent entity that manages the trlmsactions between entities. Often, the powerpool is not meant· to provide transmission access and pricing orto provide settlement mechanisms 

### if differences between contracted volumes among buyers and sellers exist. Reactive Power

- Portion ofelectricity that establishes and sustains the electric and magnetic fields ofalternating-current equipment. Reactive powermust be supplied

### to most types ofmagnetic equipment, such as motors and transformers. It also must supply the reactive losses on transmission facilities. Reactive poweris providedby generators, synchronous condensers, orelectrostatic equipment such as capacitors and directly influences electric system voltage. It is usually expressed in kilovars (kV AR) or megavars (MYAR). Real Power

- Rate ofproducing, transferring, orusing electrical energy"usually**express~** in kilowatts (kW) or megawatts (MW). Reliability

- Degree ofperformance ofthe elements ofthe bulk-power system that
. results in electricity being delivered to customers within accepted standards and in the amount desired. Reliability may be measured bythe frequency, duration, and magriitude ofadverse effects on the electric supply. Electric system reliability can**~** addressed by considering twobasic and functional aspects ofthe electric system
- adequacy and security.
. '.
. Reserve

- Electric powergenerating capacity in excess ofthe system load projected for a given time period. It consists oftwo sources: spinning reserve and supplemental reserve.

## EE-RM/STD-98-440 - · Reportof theDOE PowerOutageStudy Team onElectricReliabilityEvents oftheSummer of 1999

- 

### Retail Sales -With regard to the electric industry, electrical energy supplied.for : . ::- .: ' residential, commercial, and industrial end-use purposes. Other small end-use classes, such as agriculture and street lighting, also are included. Schedule-Agreed-upon transaction size (megawatts), start and end time, beginning and ending ramp times and rate, and type required for delivery and receipt ofpower and energy between the contracting parties and the control area(s) involved in the transaction. Security - Ability ofthe electric system to withstand sudden disturbances, such as electric short circuits or unanticipated loss ofsystem elements. Security Coordinator- One of23 entities established by NERC with the responsibility and authority to direct actions aimed at maintaining real-time security fora control area, group ofcontrol areas, NERC subregion, or NERC region.
.. Short-Notice or Short-Term Transaction- Transaction for the transfer ofnet energy from one region to another, made with little time between the transaction and the transfer (typically, less than one hour). Spinning Reserve -Ancillary service that provides additional capacity from electricity generators that are on line, loaded to less than their maximum output, and available to serve customer demand immediately should a contingency occur. Stability- Ability ofan electric system to maintain a state ofequilibrium during normal and abnormal system conditions or disturbances.
. Supplemental Reserve

- Ancillary service that provides additional capacity from electricity generators that can be used to respond to a contingency within a short period, usually 10 minutes. System -see Electric System. 

### System Operator- Individual at an electric system control center whoseresponsibility it is to monitor and control that electric system in real time. Tariff
- 

### Schedule detailing the terms, conditions, and rate information applicable to various types ofelectric service. Topology -Structure and layout ofa system. Transmission - Interconnected group oflines and associated equipment forthe movement or transfer ofelectric energy between points ofsupply and points at which itis transformed for delivery to customers or is delivered to otherelectric systems. Unit - see Generating Unit.

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# ... Reportof theDOEPower Outage Study Team on ElectricReliabilityEvents of the Summer of 1999
Retail Sales

- Withregard to the electric industry, electrical**energysuppliedJor:~·** - residential, commercial, and industrial end-use purposes. Other small end-use classes, such as agriculture and street lighting, also are**incl~ded.** Schedule

- Agreed-upon transaction size (megawatts), start and end time, beginning·· and ending ramp times and rate, and type required for delivery and receipt ofpower and energybetweenthe contracting parties and the control area(s) involved in the transaction. Security

- Ability ofthe electric system to withstand sudden disturbances, such as electric short circuits orunanticipated loss ofsystem elements. Security Coordinator

- One of23 entities established byNERC with the responsibility and authority to direct actions aimed at maintaining real-time security for a control area, group ofcontrol areas, NERC subregion, orNERC region. Short-Notice or Short-Term Transaction :- Transaction for the transfer ofnet energy from one region to another, made with little time between the transaction and the transfer (typically, less than one hour). SpinningReserve

- Ancillary service that provides additional capacity from electricity generators that are on line, loaded tei less than their maximum output, and available to serve customer demand immediately should a contingency occur. Stability

- Ability ofan electric systemto maintain a state ofequilibrium during normal and abnormal system conditions or disturbances. SupplementalReserve

- Ancillary service thatprovides additional capacity from electricity generators that canbe used to respond to a contingency within a short period, usually 10 minutes. System

- see Electric System. System Operator

- Individual at an electric system control centerwhoseresponsibility it is to monitor and control that electric system in real time. Tariff---; Schedule detailing the terms, conditions, and rate information applicable to various types ofelectric service. Topology

- Structure and layout ofa system. Transmission

- Interconnected group oflines and associated equipment for the . : movement ortransfer ofelectric energy between points ofsupply andpointsat which it is transformed for delivery to customers or is delivered to otherelectric systems..... Unit

- see Generating Unit. .." .. -', .i_
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### Unit Commitment- Process ofdetermining which generators should be operated each dayto meet the daily demand ofthe system. Utility - see Electric Utility. 

### Volt-Ampere-Reactive (VAR) - Unit ofmeasure ofthepower that maintains the constantly varying electric and magnetic fields associated with alternating-current circuits. See Reactive Power. Voltage - The unit ofmeasure ofelectric potential. Voltage Collapse

- An event that occurs when an electric system does not have adequate reactive support to maintain voltage stability. Voltage collapse may result in outage ofsystem elements and may include interruption in service to customers. Wholesale Electricity Market- Purchase and sale ofpower, according to agreements with varying lengths and lead times, amongpower marketers, power producers, and other wholesale entities.

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## • Report of the DOEPower Outage Study TeQm onElectricReliabilityEvents of the Summer of 1999
.
Unit Commitment-l?rocess ofdetennining which generators sh(;mld be operated each ". day to meet the daily demand ofthe system. Utility

- see Electric Utility: Volt-Ampere-Reactive (V AR)

- Unit ofmeasure ofthe powerthat maintains the constantly varying electric and magnetic fields associated with alternating-current circuits. See Reactive Power. Voltage

- The unit ofmeasure ofelectric potential. Voltage Collapse

- 

## An event that occurs when an electric system does nothave adequate reactive support to maintain voltage stability. Voltage collapse mayresult in outage ofsystem elements and may include interruption in service to customers. Wholesale Electricity Market

- Purchase and sale ofpower, according to agreements withvarying lengths and leadtimes, amongpower marketers, powerproducers, and other wholesale entities.

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