From: King.Melanie@epamail.epa.gov

Sent: Friday, January 04, 2013 9:25 PM

To: Cortney Higgins

Cc: VanLare.Paula@epamail.epa.gov; Balserak.Paul@epamail.epa.gov

Subject: Fw: FW:

Attachments: NRECA RICE recommendations.docx

Hi Cortney,

I wanted to pass this along in response to the comments from SBA today that the rural coops have indicated that reporting of hours of operation would be an unreasonable burden. 

 Below is the feedback we got from NRECA on whether their members were amenable to 

filing information electronically. 

-----Forwarded by Melanie King/RTP/USEPA/US on 01/04/2013 09:21PM -----

To: Melanie King/RTP/USEPA/US@EPA, RobertJ Wayland/RTP/USEPA/US@EPA, Joseph 

Goffman/DC/USEPA/US@EPA, Peter Tsirigotis/RTP/USEPA/US@EPA 

From: "Cronmiller, Rae E." <rae.cronmiller@nreca.coop> 

Date: 10/31/2012 03:44PM 

Cc: "Cromwell, Ted T." <ted.cromwell@nreca.coop> 

Subject: FW: 

(See attached file: NRECA RICE recommendations.docx)

Greetings. NRECA has conferred with our membership regarding the issues raised in connection with 

the RICE June 7, 2012 proposal. This e-mail and attachment represents our summary 

recommendations and answers to several questions posed by EPA over the several months.

Regarding the following questions. Would your members be willing to file electronically with EPA on 

annual basis, hours and time durations of RICE dispatch for emergency demand response to begin in 

several years? Yes. We have to note that the utility knows when and why their dispatch of 

emergency RICE was ordered. However the utility has no way of knowing if the owner ran the unit for 

more or less than the time requested, although the total annual operated hours of each RICE would 

be recorded at the RICE site by a non resettable hours meter as required by the existing regulations. 

We also note that if the owner “takes the unit offline” without being dispatched by the utility, we 

would not know those hours of operation, but again, they would be recorded by the no resettable 

hours meter.

Would you members be willing to use ultra low sulfur diesel fuel for RICE dispatched for emergency 

purposes? Yes, for emergency dispatch to maintain reliability at the sub-bulk power (non RTO/ ISO) 

level. We assume your question was directed at our efforts to broaden RICE emergency use at the 

local level to maintain local reliability. We have no position on whether those RICE responding to EE2 

regional power alerts (capacity markets) for example would agree to an ultra low sulfur fuel mandate.

The attachment provides text recommendations addressing the following areas: 1. Suggested 

Language in red identifying entity responsibility for ordering RICE dispatch following protocols 

necessary for maintaining local reliability as a follow up to Melanie’s question late last week. This 

language is an amendment to what was submitted earlier as 63.6640(f)(ii)(b) in effort to further define 

appropriate RICE emergency dispatch at the local level. We have included the background materials 

submitted earlier as well.
2. For economic demand response beyond the 2017 sunset, we suggested in an earlier meeting with 

EPA to allow RICE operation beyond the sunset if the RICE was equipped with crankcase ventilation 

(CCV) and utilized ultra low sulfur diesel fuel along with the requirements included in Table 2d for 

emergency RICE (this could be defined as GACT). We have attached language pursuant to this earlier 

suggestion.

3. For annual hours of operation, as we noted in our earlier written comments, the penalties for 

exceeding the annual cap are severe and not justified for accidental noncompliance. We believe 

defining compliance on a three your annual rolling average is equitably justified here. We have 

included language to allow compliance with both the 100 hour cap and the 50 hour economic demand 

response cap based on the three year rolling average concept. After all whether emergency or 

economic demand response, all RICE use here is unplanned and cannot be predicted months or even 

days ahead of time.

Lastly we do appreciate all your efforts to understand our concerns that reliable and affordable and 

electric power be maintained throughout rural America. The last few days here in Washington D.C. 

area and the northeast corridor are vivid reminders of how important RICE generation can be in times 

of distress. Our members pride themselves in providing excellent power quality and reliability even 

in rural and remote areas. We endeavor to assist them in this RICE effort. 

Please feel free to contact us should you have any questions.

Confidentiality Notice: This e-mail message, including any attachments, is for the sole use of 

the intended recipient(s) and may contain confidential and privileged information. Any 

unauthorized review, copy, use, disclosure, or distribution is prohibited. If you are not the 

intended recipient, please contact the sender by reply e-mail and destroy all copies of the 

original message. 

=
1 

Adding a more practical definition of emergency demand response

§63.6640(f) 

(ii) – Emergency stationary RICE may be operated for emergency demand response for periods 

in which: 

(a) the regional transmission authority, or equivalent balancing authority and 

transmission operator has declared an Energy Emergency Alert Level 2 (EEA Level 

2) as defined in the North American Electric Reliability Corporation Reliability 

Standard (NERC) EOP-002-3 Capacity and Energy Emergencies, or 

(b) the dispatch follows reliability, emergency operation or similar protocols that either directly 

or indirectly follow NERC, regional, state, public utility commission or local standards or 

guidelines1

when called upon by a reliability coordinator, balancing authority, transmission 

operator or one of their designees; or a local municipal authority to mitigate local 

transmission and/or distribution limitations so as to avert potential voltage collapse or line 

overloads that could lead to the interruption of power supply in a local area or region. 

(iii) Emergency stationary RICE may be operated for periods where this is a deviation of voltage 

or frequency of 5 percent or greater below standard voltage or frequency2

. 

Demand Response Background

A key component3

 in ensuring electric reliability at bulk power electric system level includes 

measures taken to prevent system failures, including those at the sub-regional or local distribution 

levels. Appropriate actions do avoid cascading effects that otherwise result in bulk power or 

region-wide disruptions or even blackouts4

. In many cases potential reliability issues at the sub 

regional levels are not detectable at the bulk electric system level because reliability planning 

activities are not always conducted at voltages below transmission levels5

. Even so, electric 

systems having sub-transmission or distribution networks necessarily falling outside of FERC or 

federal jurisdiction has very significant incentives to take measures as necessary to prevent these 

system failures and ensure local sub-transmission and distribution reliability. Further, there are 

potentially heavy penalties associated with the failure to adhere to NERC reliability standards. In 

some areas of the US, there are also requirements imposed by regional, state or local entities, 

even those which occur at lower voltages. 

Reliability or emergency action protocols guiding these sub-regional electric system operations 

might be administered by any one of several entities, but they are similar in purpose to those at 

the bulk electric system levels, which is to provide guidance for operation to avoid system 

failures and preserve reliability at the local level. 

Limiting emergency RICE operation to situations when EEA level 2 is incurred might prohibit or 

at the very least strongly discourage necessary RICE operation at local second-contingency 

 

1 http://www.nerc.com/page.php?cid=2|20

2 Modern generating equipment may not be operated at frequencies below 5% of 60Hz. 3

 Elements of electric system reliability planning include the assurance of adequate installed capacity, available energy 

producing resources, and sufficient transmission infrastructure to meet anticipated customer loads at design voltage and 

frequency conditions. 

4

 This second condition leading to the interruption of service is commonly called a second contingency, that is, an event 

that by itself would not lead to an interruption of service (line interruption due to weather-related events), but which 

following on the heels of an earlier event (the unplanned generating unit outage) has the combined effect of causing the 

loss of load. 

5

 Bulk electric system (BES) transmission voltage level is that which is greater than 100Kv. Voltage levels below those 

are simply called “sub-transmission” or distribution. 
2 

conditions that would otherwise ensure electric reliability and power quality, and would more 

broadly ensure the integrity of the nation’s bulk power systems. Extending allowed emergency 

RICE use that follows or mirrors protocols established by NERC or other organizations having 

responsibilities for bulk electric system reliability or emergency operation, (such as that 

referenced under EEA Level 2), will ensure that RICE regulations do not jeopardize the local or 

sub-regional grid reliability which is also necessary to protect human health. 

In practice, the use of RICE generators should be allowed when called upon by the balancing area 

authority to mitigate local transmission and/or distribution limitations so as to avert potential 

(pre-contingency) voltage collapse or line overloads that, if no mitigation was to occur, could lead 

to the interruption of power supply in a local area6

. These steps are more akin to meeting EEA 

Alert Level 1 where actions are taken in anticipation of an energy deficiency to prevent an 

escalation. These events can occur even when a balancing area or region has more than adequate 

energy resources to meet their load, but deliverability into a local area is constrained due to 

transmission or sub-transmission outages that are either planned or unplanned or areas with 

inadequate transmission available to import power. While these types of interruptions can result 

in power loss to thousands of consumers, they do not rise to the EEA level 2 because they are not 

energy related and they may not materially impact Bulk Electric System reliability (i.e., cascading 

transmission outages or instability) or they are within a Transmission Operator footprint in nonRTO / ISO areas. Today, these types of interruptions are routinely identified by Transmission 

Operators who, anticipating low-voltage situations, take appropriate steps which may include the 

operation of RICE generators as a pre-contingency measure to mitigate the loss of load due to the 

occurrence of a second-contingency event. 

These events can be and are documented on a local level. Operation of RICE generators for such 

circumstances should be allowed when the responsible Transmission Owner/Operator has a 

documented mitigation plan approved by the appropriate regional coordinating group that 

provides for RICE generators to operate. The mitigation plan may specify procedures and 

alternatives for mitigating the interruption; such alternatives could include measures such as the 

implementation of demand-side management, reduction in supply to interruptible customers, and 

load shedding on a pre-contingency basis in addition to the use of RICE generators. The use of 

emergency generation including RICE generation is preferred to any preventable black out. 

Under an approved mitigation plan, the Transmission Operator would direct load-serving entities 

and distribution providers in the local affected area to reduce load on a pre-contingency basis to 

avert localized voltage collapse or line overloads. Use of RICE generators, which are within the 

local area, can accomplish all, or part of the required load reduction and thus support voltage 

stabilization to mitigate the interruption before it can impact the bulk electric system. RICE 

generator use should be permissible anytime they meet the requirements of a mitigation plan 

facilitating pre-contingency load interruption as documented in a regional, or Reliability 

Coordinator wide, transmission advance assessment. Distribution Providers and Load Serving 

Entities should also be permitted to use RICE generators in response to a Transmission Operators 

(Transmission Service Provider) directive to reduce load and to support voltage requirements on a 

pre-contingency basis to avert a blackout of the local area. In those instances when mitigation 

plans have not been developed and approved in advance of the event, evidence (voice recordings 

of directives or emails) can be retained to demonstrate that operation was for reliability purposes 

and in response to a NERC Transmission Operator directive. 

 

6

 Mitigating pre-contingency actions that can be undertaken include shifting loads between or among different 

transmission lines, shifting loads among or between different distribution lines or circuits, the operation of municipal 

generation, load control by shedding interruptible loads and implementing demand response measures, public appeals 

to reduce the use of electricity, and finally rotating outages. These are also post-contingency actions when restoring the 

grid after the loss of load. 
3 

Allowing compliance with emergency demand response using annual hours of allowed operation 

based on three year rolling average

Compliance with any hours of limitation in §63.6640 shall be based on a calendar year threeyear rolling average with the first annual compliance period beginning three years after the year 

in which the June 7, 2012 proposal is finalized. 

Rolling Average Background

The very nature of emergency RICE annual operation is based on unpredictable circumstances 

that require use of these units to address reliability7

 and emergency operations8. Data on these 

triggering events demonstrate that the annual limitation on average is expected to be well below 

the numerical limitations in the existing and proposed RICE regulations. However, as several 

commenters have noted in the response to the June 7, 2012 proposal certain events such as those 

that have occurred in the past, while rarely occurring, may necessitate emergency RICE operation 

that surpasses the proposed annual limitations. 

Currently, EPA’s proposal would permanently bar any RICE unit from maintaining its 

“emergency status” if its operation exceeds any of the proposed annual hours of limitation 

thresholds. The requirement is unnecessarily draconian and would severely penalize RICE 

owners and operators who took actions necessary to ensure reliable power for consumers during 

rare unanticipated events. 

Incorporating a three-year rolling annual average would allow RICE owners and operators 

latitude to operate the RICE units in these instances without undue concern of losing emergency 

status. By determining annual compliance over a three-year averaging period there is a high 

probability that, even if a unit’s individual yearly operation should surpass an annual threshold, 

the three-year annual rolling average limitation could most likely be met. 

NRECA Recommended Language for Load Management 

 §63.6640(f)(4) Existing emergency stationary RICE located at area sources of HAP may be 

operated for up to 50 hours per calendar year in non-emergency situations. The 50 hours of 

operation in non-emergency situations are counted as part of the 100 hours per calendar year for 

maintenance and testing and emergency demand response provided in paragraph (f)(2) of this 

section. 

(i) Prior to April 16, 2017, the 50 hours per year for non-emergency situations can be 

used for peak shaving or non-emergency demand response to generate income for a 

facility, or to otherwise supply power as part of a financial arrangement with another 

entity if (sic) engines is operated as part of a peak shaving (load management program) 

with the local distribution system operator and the power is provided only to the facility 

itself or to support the local distribution system. 

 (ii) On or after April 16, 2017, the 50 hours per year for non-emergency situations 

cannot be used for peak shaving or non-emergency demand response, or to otherwise 

supply power as part of a financial arrangement with another entity, except this 

prohibition excludes continental (lower 48 states) emergency stationary RICE hours of 

operation utilized to supply off grid power provided that compression ignition 

emergency RICE utilize ultra-low sulfur diesel fuel (15 ppm) and install either a closed 

 

7

 Pre-contingency actions or measures 

8

 Post-contingency actions or measures
4 

or open crankcase filtration system as appropriate for the engine, and follows 

management practices as described in Table 2d of Subpart ZZZZ. 

 (iii) Compliance with the hours of limitation in §63.6640(f)(4) for emergency RICE used 

in non-emergency situations shall be based on a calendar year three-year rolling average 

with the total hours not to exceed 100 in any calendar year and with the first annual 

compliance period beginning three years after the year in which the June 7, 2012 

proposal is finalized. The owner/operator must maintain records on the hours of usage 

according to §63.6655. 

Load Management Background

As described in the NRECA comments on EPA’s June 7, 2012 proposal, EPA provided 

justification for allowing emergency RICE engines limited additional usage as this usage up to 

100 hours annually would pose no adverse health or environmental impacts and further, to allow 

small electric cooperatives and other entities located at area sources that use these engines to 

maintain voltage and electric reliability. EPA decided however to restrict the use of emergency 

RICE for load management to only 50 hours annually with a sunset effective April 17, 2017. The 

proposal provided no rationale for restricting economic demand response (load management) 

resulting in limited economic benefit through reduced rates for cooperative customers while 

allowing demand response provisions that also provide an economic benefit to unit owners that 

participate in capacity markets. 

The language NRECA has provided above adds control requirements for emergency RICE 

engines utilized for off-grid load management or demand response activities after the currently 

proposed April 17, 2017 sunset. Specifically, NRECA recommends that after April 17, 2012, 

continental emergency RICE units that install CCV controls, use ultra sulfur fuel and follow 

management practices be allowed to provide off grid power for up to 50 hours annually (or using 

a rolling average as described above). This combination of technologies and management 

practices would further reduce fine particulate emissions and metallic hazardous air pollutants. 

This is a reasonable balance further reducing emissions from these limited use (50 hours or less) 

area sources, without requiring the costly retrofits that would be necessary to meet the MACT 

limit that was designed for units operating up to 1000 hours or more. 

Recordkeeping and reporting requirements would follow §63.6655 which already requires a) nonresettable hour meters that cannot be tampered with, b) owner/operator documentation of both the 

hours and types of usage. We think this provision clearly requires documentation and 

explanation for all hours of RICE utilization. Additionally under NERC requirements, utilities 

are required to document outages including the reason for the outage, the length of the outage, 

and steps taken to mitigate the outage and when power was restored. This combination of 

requirements provides clear documentation for purposes of compliance and enforcement.