[Federal Register Volume 87, Number 126 (Friday, July 1, 2022)]
[Proposed Rules]
[Pages 39414-39426]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-13469]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 141

[Docket Nos. RM22-16-000 and AD21-13-000]


One-Time Informational Reports on Extreme Weather Vulnerability 
Assessments; Climate Change, Extreme Weather, and Electric System 
Reliability

AGENCY: Federal Energy Regulatory Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Federal Energy Regulatory Commission is initiating this 
rulemaking to propose to direct transmission providers to submit one-
time informational reports describing their current or planned policies 
and processes for conducting extreme weather vulnerability assessments. 
The Commission proposes to define extreme weather vulnerability 
assessments as analyses that identify where and under what conditions 
jurisdictional transmission assets and operations are at risk from the 
impacts of extreme weather events, how those risks will manifest 
themselves, and what the consequences will be for system operations. 
Specifically, the Commission proposes to require transmission providers 
to submit a one-time informational report on how they establish a scope 
for their extreme weather vulnerability assessments,

[[Page 39415]]

develop inputs, identify vulnerabilities and determine exposure to 
extreme weather hazards, estimate the costs of impacts, and develop 
mitigation measures to address extreme weather risks.

DATES: Initial comments are due August 30, 2022.

ADDRESSES: Comments, identified by docket number, may be filed in the 
following ways. Electronic filing through http://www.ferc.gov, is 
preferred.
    <bullet> Electronic Filing: Documents must be filed in acceptable 
native applications and print-to-PDF, but not in scanned or picture 
format.
    <bullet> For those unable to file electronically, comments may be 
filed by USPS mail or by hand (including courier) delivery.
    [cir] Mail via U.S. Postal Service Only: Addressed to: Federal 
Energy Regulatory Commission, Secretary of the Commission, 888 First 
Street NE, Washington, DC 20426.
    [cir] Hand (including courier) delivery: Deliver to: Federal Energy 
Regulatory Commission, 12225 Wilkins Avenue, Rockville, MD 20852.
    The Comment Procedures Section of this document contains more 
detailed filing procedures.

FOR FURTHER INFORMATION CONTACT: 
Neal Anderson (Legal Information), Office of the General Counsel, 
Federal Energy Regulatory Commission, 888 First Street NE, Washington, 
DC 20426, (202) 502-8760, <a href="/cdn-cgi/l/email-protection#d49ab1b5b8fa95bab0b1a6a7bbba94b2b1a6b7fab3bba2"><span class="__cf_email__" data-cfemail="09476c68652748676d6c7b7a6667496f6c7b6a276e667f">[email protected]</span></a>
Alyssa Meyer (Technical Information), Office of Energy Policy and 
Innovation, Federal Energy Regulatory Commission, 888 First Street NE, 
Washington, DC 20426, (202) 502-6835, <a href="/cdn-cgi/l/email-protection#1a5b766369697b34577f637f685a7c7f6879347d756c"><span class="__cf_email__" data-cfemail="1455786d6767753a59716d716654727166773a737b62">[email protected]</span></a>

SUPPLEMENTARY INFORMATION

 
                                                               Paragraph
                                                                 Nos.
 
I. Introduction.............................................           1
II. Background..............................................          11
    A. Procedural History...................................          11
    B. Need for Reports.....................................          13
III. Discussion.............................................          19
    A. Scope................................................          25
        1. Background.......................................          25
        2. Proposal.........................................          28
    B. Inputs...............................................          29
        1. Background.......................................          29
        2. Proposal.........................................          34
    C. Vulnerabilities and Exposure to Extreme Weather                35
     Hazards................................................
        1. Background.......................................          35
        2. Proposal.........................................          39
    D. Costs of Impacts.....................................          40
        1. Background.......................................          40
        2. Proposal.........................................          43
    E. Risk Mitigation......................................          44
        1. Background.......................................          44
        2. Proposal.........................................          48
IV. Information Collection Statement........................          49
V. Environmental Analysis...................................          56
VI. Regulatory Flexibility Act..............................          57
VII. Comment Procedures.....................................          62
VIII. Document Availability.................................          65
 

I. Introduction

    1. In this Notice of Proposed Rulemaking (NOPR), the Federal Energy 
Regulatory Commission (Commission) proposes to require each 
transmission provider \1\ to file a one-time informational report 
pursuant to Sec.  304 of the Federal Power Act (FPA).\2\ In the one-
time reports, transmission providers would describe their current or 
planned policies and processes for conducting extreme weather 
vulnerability assessments. The Commission believes that these reports 
will assist in its administration of the FPA.
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    \1\ In this NOPR, unless otherwise noted, we use the term 
``transmission provider'' to mean any public utility that owns, 
controls, or operates facilities used for the transmission of 
electric energy in interstate commerce. See 16 U.S.C. 824(e); 18 CFR 
35.28. To be clear, this term encompasses public utility 
transmission owners that are members of Regional Transmission 
Organizations (RTO) and Independent System Operators (ISO). 
Accordingly, the reports we are proposing herein would be filed by 
the public utility members of RTOs/ISOs, as well as by the RTOs/ISOs 
themselves and other public utility transmission providers.
    \2\ 16 U.S.C. 825c. Section 304 of the FPA provides that ``every 
public utility shall file with the Commission such annual and other 
periodic or special reports as the Commission may by rules and 
regulations or order prescribe as necessary or appropriate to assist 
the Commission in the proper administration of'' the FPA. Id.
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    2. The reliability of the electric grid is increasingly threatened 
by extreme weather events and climate change. While extreme weather has 
impacted the electric grid throughout its history, the severity and 
frequency of extreme weather events is increasing.\3\ A robust and 
growing body of scientific evidence attributes this trend to climate 
change and indicates that the tendency toward more frequent and more 
severe weather events will persist.\4\ In light of this trend, we 
believe it is increasingly important to understand how the risks of 
extreme weather to the electric grid are evaluated and mitigated.
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    \3\ National Oceanic and Atmospheric Administration, National 
Centers for Environmental Information ``U.S. Billion-Dollar Weather 
and Climate Disasters'' (2022), https://www.ncei.noaa.gov/access/billions/.
    \4\ Intergovernmental Panel on Climate Change, Climate Change 
2022: Impacts, Adaptation, and Vulnerability (2022); Nat'l Academies 
of Sciences, Engineering, and Medicine, Attribution of Extreme 
Weather Events in the Context of Climate Change (2016); Herring, 
S.C., N. Christidis, A. Hoell, M.P. Hoerling, and P.A. Stott, Eds. 
Explaining Extreme Events of 2020 from a Climate Perspective. 103 
Bulletin Am. Meteor. Soc'y 3 (2022).
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    3. Reliable electric service is vital to the nation's economy, 
national security, and public health and safety, and prolonged power 
outages can have significant humanitarian consequences, as the nation 
witnessed in Texas and the South-Central United States in February 2021 
during Winter Storm Uri. More

[[Page 39416]]

than four and half million people in Texas alone lost power during the 
extreme weather event, and in some cases the outages contributed to a 
tragic loss of life.\5\ Additionally, this extreme weather event had a 
significant impact to consumers as energy prices rose to historic 
levels in the wholesale markets serving Texas and the South-Central 
region during the event.\6\
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    \5\ FERC-NERC-Regional Entity Staff Report: The February 2021 
Cold Weather Outages in Texas and the South Central United States 9 
(Nov. 16, 2021), https://www.ferc.gov/media/february-2021-cold-weather-outages-texas-and-south-central-united-states-ferc-nerc-and.
    \6\ See Electric Reliability Council of Texas, Review of 
February 2021 Extreme Cold Weather Event 22 (2021), https://www.ercot.com/files/docs/2021/03/03/Texas_Legislature_Hearings_2-25-2021.pdf (average system wide pricing during event greater than 
$6000/MWh compared to $18-20/MWh in more typical conditions); 
Southwest Power Pool, Inc, A Comprehensive Review of SPP's Response 
to the February 2021 Winter Storm 72 (2021), https://spp.org/documents/65037/comprehensive%20review%20of%20spp's%20response%20to%20the%20feb.%2020
21%20winter%20storm%202021%2007%2019.pdf (``SPP experienced 
historically high market settlements for the impacted operating 
days''); Midcontinent Independent System Operator, The February 
Artic Event: Event Details, Lessons Learned, and Implications for 
MISO's Reliability Imperative 45 (2021), https://cdn.misoenergy.org/2021%20Arctic%20Event%20Report554429.pdf (Independent Market Monitor 
reports average energy prices rose 226 percent in February because 
of the Artic Event in February).
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    4. Winter Storm Uri is but one tragic example of the threat extreme 
weather is posing across the entire country. In the last two years 
alone,\7\ region-wide heat waves, hurricanes, and wildfires have 
resulted in outages or other significant reliability impacts, often 
while contributing to substantial consumer costs. In August 2020, 
California experienced rolling blackouts during a West-wide extreme 
heat event that impacted nearly a half million customers.\8\ Hurricane 
Ida resulted in outages for more than a million customers across eight 
states in August 2021,\9\ with the most severe impacts in Louisiana due 
to the collapse of a transmission tower and outage of more than 2,000 
miles of transmission lines outside of New Orleans. \10\ Some customers 
continued to lack electricity nearly a month after Ida's landfall.\11\ 
In July 2021, wildfires in Oregon impacted crucial transmission 
capacity, limiting the ability to import electricity into California as 
temperatures soared above 100 degrees, ultimately triggering emergency 
actions to avoid reliability impacts.\12\ At the same time, constrained 
conditions on the electric grid that result from such extreme weather 
events can increase electricity prices.\13\
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    \7\ Indeed, the North American Electric Reliability Corporation 
(NERC) found that all but one of the days in 2020 with the highest 
severity risk index, a quantitative measure of the relative severity 
of risks to the bulk power system, was attributed to some type of 
weather occurrence. NERC, 2021 State of Reliability Report 42 
(2021).
    \8\ See California Independent System Operator Corporation, 
Final Root Cause Analysis: Mid-August 2020 Extreme Heat Wave 35 
(Jan. 13, 2021), http://www.caiso.com/Documents/Final-Root-Cause-Analysis-Mid-August-2020-Extreme-Heat-Wave.pdf.
    \9\ U.S. Energy Information Administration, Hurricane Ida Caused 
At Least 1.2 Million Customers to Lose Power (accessed June 1, 
2022), https://www.eia.gov/todayinenergy/detail.php?id=49556.
    \10\ See S. Van Voorhis, Transmission Tower Destroyed by Ida 
Likely to Complicate Power Restoration in New Orleans, Experts Say 
(Aug. 31, 2021), https://www.utilitydive.com/news/transmission-tower-destroyed-by-ida-likely-to-complicate-power-restoration/605826/.
    \11\ U.S. Department of Energy, Hurricanes Ida and Nicholas 
Update # 20 (Sept. 23, 2021), https://www.energy.gov/sites/default/files/2021-09/TLP-WHITE_DOE%20Situation%20Update_Hurricane%20Ida_20.pdf.
    \12\ See California Independent System Operator Corporation, 
California ISO Issues Flex Alert for Monday, July 12 Due to 
Wildfires, Heat (July 11, 2021), https://www.caiso.com/Documents/California-ISO-Issues-Flex-Alert-for-Monday-July-12-due-to-Wildfires-Heat.pdf.
    \13\ See e.g., Dale et al., Assessing the Impact of Wildfires on 
the California Electricity Grid: A report for California's Fourth 
Climate Assessment 16-18 (Aug. 2018), https://www.energy.ca.gov/sites/default/files/2019-12/Forests_CCCA4-CEC-2018-002_ada.pdf 
(estimating multi-million dollar costs increases per event due to 
disruption of transmission paths caused by wildfires).
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    5. Looking forward, the threats of extreme weather and climate 
change are expected to continue to challenge the reliability of our 
electric grid. This upcoming summer, NERC expects extreme drought 
conditions and above-average temperatures across wide areas of North 
America, resulting in heightened reliability risk.\14\ Drought 
increases reliability risk because it can reduce availability of 
generation during periods of high peak demand. Drought may impact 
energy output from hydro generators as well as generators that depend 
upon once-through cooling as low water levels trigger conservation 
measures.\15\ Above-average temperatures exacerbate reliability risk by 
contributing to prolonged periods of high electricity demand and to 
higher forced outage rates for generation and other elements of the 
bulk power system. NERC also projects above-normal fire risk across 
U.S. South Central states, Northern California, Oregon, and Canada this 
summer, which poses the risk of impacts to the transmission system, 
potentially reducing output of solar PV generation due to smoke.\16\
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    \14\ NERC, 2022 Summer Reliability Assessment at 4, 7 (May 
2022), https://www.nerc.com/pa/RAPA/ra/Reliability%20Assessments%20DL/NERC_SRA_2022.pdf.
    \15\ Id. at 4.
    \16\ Id. at 6, 8.
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    6. NERC also evaluated these risks over the long-term in its 
December 2021 Long Term Reliability Assessment and identified extreme 
weather among the top risks that stakeholders and policymakers need to 
focus on over the next ten years.\17\ NERC concluded in particular that 
wide-area and long duration extreme weather events driven by climate 
change threaten reliability over the long-term. NERC identified a 
combination of factors that make such extreme weather events a threat 
to reliability. Changes in climatology and the electrical system can 
increase the volatility and uncertainty of electricity demand and thus 
the risk that grid operators are unprepared for the peak demands that 
accompany extreme weather. Further, when extreme temperatures extend 
over a wide area for a long duration, resources can be strained across 
multiple regions simultaneously, increasing the risk of shortfalls. At 
the same time, transmission networks can become stressed by wide-area 
events such as storms, wildfires, or heat waves, limiting imports of 
electricity that could relieve shortfalls. Both weather-dependent 
variable energy resources and thermal generation face risks of reduced 
output or increased outages due to extreme weather events (e.g., frozen 
equipment, poor hydrological conditions).\18\ While the nature of 
extreme weather and the extent of transmission impairments will vary 
across different regions of the United States, no region will be 
unaffected.
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    \17\ NERC, 2021 Long-term Reliability Assessment at 5-6 (Dec. 
2021), https://www.nerc.com/pa/RAPA/ra/Reliability%20Assessments%20DL/NERC_LTRA_2021.pdf.
    \18\ Id. at 23-26.
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    7. The Government Accountability Office (GAO) issued a report in 
May 2021 stating that climate change is expected to have far-reaching 
effects on the electricity grid that could cost billions and could 
affect the ability of grid operators to transmit electricity.\19\ GAO 
identified potential impacts of climate change-driven extreme weather 
to the grid in every region of the United States, and discussed the 
risk that, absent measures to increase resilience, more frequent and 
severe weather associated with climate change may increase outages, 
imposing billions of dollars in additional costs to utility

[[Page 39417]]

customers. GAO recommended that the Commission take steps to identify 
or assess climate change risks to the grid in order to ensure it is 
well-positioned to determine the actions needed to enhance resilience 
to those risks.\20\
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    \19\ GAO, Electricity Grid Resilience: Climate Change Is 
Expected to Have Far-Reaching Effects and DOE and FERC Should Take 
Actions (Mar. 2021), https://www.gao.gov/products/gao-21-423t (GAO 
Report).
    \20\ Id. at 18-19, 47.
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    8. In light of recent extreme weather events which demonstrate 
their potential to substantially impact the reliability of the bulk 
power system and jurisdictional rates, as well as the series of 
assessments \21\ concluding that climate change and extreme weather are 
expected to pose an ongoing and increasing threat to the electricity 
grid, we believe that a greater understanding of actions to assess the 
vulnerabilities of jurisdictional transmission assets and operations to 
extreme weather events is necessary to carry out our responsibilities 
under the FPA.\22\ Therefore, we propose to direct transmission 
providers to submit one-time informational reports describing their 
current or planned policies and processes for conducting extreme 
weather vulnerability assessments and developing solutions for 
mitigating identified extreme weather risks.
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    \21\ See supra notes 14, 17 & 19.
    \22\ 16 U.S.C. 824d, 824o.
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    9. Requiring transmission providers to submit a one-time 
informational report on their current or planned efforts to assess the 
vulnerabilities of their jurisdictional transmission assets and 
operations to extreme weather events is necessary for ensuring just and 
reasonable rates. Requiring one-time reports on this information will 
also enhance transparency as well as provide opportunities for sharing 
best practices among transmission providers. Therefore, we propose to 
direct transmission providers to submit one-time informational reports 
describing their current or planned policies and processes for 
conducting extreme weather vulnerability assessments.
    10. For the purposes of this rulemaking, we propose to define an 
extreme weather vulnerability assessment as any analysis that 
identifies where and under what conditions jurisdictional transmission 
assets and operations are at risk from the impacts of extreme weather 
events, how those risks will manifest themselves, and what the 
consequences will be for transmission system operations.\23\ We propose 
to require that these one-time informational reports be filed 90 days 
after the publication of any final rule in this proceeding in the 
Federal Register. We also propose to seek public comment on the reports 
30 days after they are filed.
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    \23\ See infra P 20.
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II. Background

A. Procedural History

    11. On March 5, 2021, the Commission issued an initial Notice of 
Technical Conference stating that Commission staff would convene a 
technical conference to discuss issues surrounding the threat to 
electric system reliability posed by climate change and extreme weather 
events.\24\ On March 15, 2021, the Commission issued a Supplemental 
Notice inviting pre-technical conference comments.\25\
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    \24\ March 5, 2021 Notice of Technical Conference, Docket No. 
AD21-13-000.
    \25\ March 15, 2021 Supplemental Notice of Technical Conference 
Inviting Comments, Docket No. AD21-13-000.
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    12. During the technical conference, held on June 1 and 2, 2021, 
the Commission heard from utility executives, RTOs/ISOs and market 
monitor executives, state regulators and energy officials, and energy 
policy and reliability experts, as well as climatologists. 
Subsequently, a Notice Inviting Post-Technical Conference Comments was 
issued on August 11, 2021.\26\ Panelists and commenters agreed that 
electric system planning processes need adjustment to adequately 
address the threat posed by climate change and extreme weather. 
Although individual utilities and states facing these threats can and 
do adjust their planning, operations, and restoration practices in 
response to climate change, there was widespread agreement that regular 
and ongoing information sharing and coordination across jurisdictions 
will be critical.\27\ Panelists also recommended that such sharing not 
be limited to lessons learned, insofar as ongoing information sharing 
could also benefit entities developing climate models (e.g., the 
National Oceanic and Atmospheric Administration (NOAA)) that may not 
always know what information is relevant to electric system planners 
and their stakeholders. Finally, there was agreement that the 
Commission should play a role in facilitating information sharing among 
industry stakeholders and government agencies.\28\
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    \26\ August 11, 2021 Notice Inviting Post-Technical Conference 
Comments, Docket No. AD21-13-000.
    \27\ See, e.g., June 2, 2021 Tr. 127 (Wayland), 129-130 
(Howard); Columbia/EDF Pre-Conference Comments at 2; PJM Pre-
Conference Comments at 6-9; East Kentucky Power Cooperative, Inc. 
Pre-Conference Comments at 6-8; CPUC Pre-Conference Comments at 19; 
Tabors Caramanis Rudkevich Pre-Conference Comments at 11-12, 20; 
Exelon Pre-Conference Comments at 23-24.
    \28\ See, e.g., June 2, 2021 Tr. 127 (Wayland), 127-128 
(Scripps), 129-130 (Howard), 132 (Terry); Exelon Pre-Conference 
Comments at 34; NARUC Pre-Conference Comments at 5-6.
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B. Need for Reports

    13. Extreme weather events place the reliability of electric 
service at risk. As discussed above, the United States has witnessed 
several instances over just the past few years of how extreme weather 
has severely impacted several regions of the nation. The consequences 
to the electric system have included rolling blackouts, more extensive 
service disruptions, limited transmission capacity, and damaged 
electric infrastructure. These types of impacts not only harm system 
reliability and strain the grid, but they also affect Commission-
jurisdictional rates. Moreover, the frequency and severity of extreme 
weather has been increasing--and is likely to continue to increase--and 
we are concerned that system reliability could be further jeopardized 
and that jurisdictional rates could be further affected.\29\ 
Accordingly, we believe that, to assist in our administration of the 
FPA, it is critically important for the Commission to understand how 
transmission providers assess their vulnerabilities to extreme weather 
events. As we explain below, requiring transmission providers to submit 
a one-time report providing the information sought in this NOPR will 
enhance the Commission's ability to fulfill its obligations under the 
FPA.
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    \29\ NERC's reports on both short-term and long-term weather 
issues discussed above highlight our concern regarding the impact of 
extreme weather on system reliability, as well as our concern that 
such events are likely to increase in severity of frequency.
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    14. Although the technical conference and technical conference 
comments underscored the importance of planning appropriately for 
extreme weather, the record to date does not provide the Commission 
with a clear understanding of whether and to what extent transmission 
providers are currently conducting, or planning to conduct, extreme 
weather vulnerability assessments, the method(s) used to conduct those 
assessments, and what is done with the information from those 
assessments.\30\ Moreover, it is unclear the extent to which 
transmission providers regularly assess their vulnerabilities to 
extreme weather

[[Page 39418]]

events.\31\ But given the severe impacts resulting from extreme 
weather, as discussed above, we believe the Commission needs a better 
understanding of what transmission providers are doing--or not doing--
with respect to assessing and mitigating extreme weather risks.
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    \30\ Based on the record developed during the technical 
conference, this practice does not appear to be widespread among 
transmission providers. For example, of the six jurisdictional RTOs/
ISOs, only New York Independent System Operator, Inc. appears to 
have conducted such an assessment. Therefore, we believe that the 
proposed one-time informational reporting requirement will provide 
the necessary information for the Commission to understand the 
extent to which transmission providers are performing these 
assessments.
    \31\ We recognize that transmission providers may be undertaking 
such vulnerability assessments. See, e.g., Entergy Corporation 
(Entergy) Post-Conference Reply Comments at 1. But we nonetheless do 
not have much visibility into whether and how each transmission 
provider undertakes such assessments, and we propose to remedy that 
concern here.
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    15. We are issuing this NOPR under Sec.  304 of the FPA, which 
allows the Commission to order reports as the Commission may prescribe 
as ``necessary or appropriate to assist the Commission in the proper 
administration of'' the FPA.\32\ We believe that our proposal here does 
precisely that because it will help ensure that the Commission fulfills 
its statutory obligations with respect to system reliability and just 
and reasonable rates. Under the FPA, the Commission is responsible for 
overseeing the development and enforcement of reliability standards for 
the Bulk-power System.\33\ The Commission must also ensure that the 
rates, terms, and conditions of Commission-jurisdictional services are 
just and reasonable and not unduly discriminatory or preferential.\34\ 
The reports we propose to require will enhance the Commission's 
understanding of whether, and if so, how transmission providers are 
assessing risks to transmission assets and operations as a result of 
extreme weather events. As noted above, we believe it is important for 
the Commission to understand whether and to what extent such 
assessments are being conducted to assist the Commission in the proper 
administration of the FPA.
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    \32\ 16 U.S.C. 825c.
    \33\ Id. 824o.
    \34\ Id. 824d, 824e.
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    16. For example, the failure to assess and mitigate the risks of 
extreme weather could increase the frequency of loss of load events and 
also impact consumers who could not only experience increased frequency 
of power outages but would also ultimately bear the financial burden to 
regularly rebuild damaged infrastructure or to pay for solutions that 
may be more costly than solutions that could have been identified 
through a more proactive, forward-looking process. Extreme weather 
events can also lead to extreme prices for wholesale electricity.\35\ 
Notwithstanding these potentially severe impacts, the record in this 
proceeding does not indicate that most transmission providers have 
robust policies and processes for assessing and mitigating extreme 
weather vulnerabilities.
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    \35\ During Winter Storm Uri, both the Midcontinent Independent 
System Operator and the Southwest Power Pool experienced prices 
exceeding the $2,000/MWh cap on incremental energy offers. FERC 
Staff, 2021 State of the Markets Report, p. 30 (issued Apr. 21, 
2022).
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    17. Additionally, transmission providers may face adverse impacts 
to their credit ratings and increased insurance costs, which could 
ultimately flow through into transmission rates. For example, credit 
rating agencies like Standard & Poor's and Moody's have added 
``resiliency'' as a component of their rating criteria, indicating the 
relevance of extreme weather risk for creditworthiness.\36\ Similarly, 
transmission providers could increasingly seek access to a higher level 
of insurance to cope with potential damage from more frequent and 
destructive weather-related events.\37\ Finally, we believe that the 
one-time informational reports proposed in this NOPR will facilitate 
the sharing of best practices among transmission providers and their 
stakeholders for conducting extreme weather vulnerability assessments. 
At the technical conference, several commenters and panelists noted the 
importance of coordination and information sharing between entities in 
order to better assess and plan for extreme weather risks.\38\ The 
information in these reports could serve as the basis for further 
information sharing and coordination, which could lead to improved or 
more robust assessments and thereby better avoid the adverse rate 
impacts discussed above.
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    \36\ F. Shafroth, Climate Change and Credit Ratings (Dec. 10, 
2015), https://www.governing.com/archive/gov-climate-change-credit-ratings.html.
    \37\ See, e.g., Oregon Public Utility Commission Pre-Conference 
Comments at 6-7, National Association of Mutual Insurance Companies 
Pre-Conference Comments at 1-3.
    \38\ See June 2, 2021 Tr. 102-103 (Moskowitz); Columbia/EDF Pre-
Conference Comments at 2; PJM Pre-Conference Comments at 6-9.
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    18. Extreme weather events are occurring more frequently than ever 
before, and those events bring increased threats to system reliability 
and impacts on jurisdictional rates. Consistent with the GAO's 
recommendation noted above, the Commission needs to be well-positioned 
to take appropriate action consistent with its FPA obligations, if 
necessary. We believe that the reports we are proposing to require in 
this NOPR will help provide us with information necessary to assist us 
in administering the FPA.

III. Discussion

    19. We propose to require transmission providers to submit one-time 
informational reports describing their current or planned policies and 
processes for conducting extreme weather vulnerability assessments and 
mitigating identified extreme weather risks within 90 days of the 
publication of any final rule in this proceeding in the Federal 
Register. We propose to seek public comment on the reports 30 days 
after they are filed.
    20. For the purposes of this proposed rulemaking, we propose to 
define an extreme weather vulnerability assessment as any analysis that 
identifies where and under what conditions jurisdictional transmission 
assets and operations are at risk from the impacts of extreme weather 
events, how those risks will manifest themselves, and what the 
consequences will be for transmission system operations. Such 
assessments can take different forms: they may be qualitative or 
quantitative; they may be performed on a periodic or ad hoc basis; and 
they may cover a narrower or broader range of extreme weather threats. 
The extreme weather threats analyzed by these reports may include those 
extreme weather events exacerbated by climate change (e.g., extended 
heat waves or storm surge due to sea level rise).
    21. Transmission providers may then use such extreme weather 
vulnerability assessments to develop mitigation in the form of extreme 
weather resilience plans, which outline measures to reduce the risk to 
vulnerable assets and operations. Extreme weather resilience efforts 
can take many forms, but generally involve both measures to prevent or 
minimize damage to vulnerable assets (e.g., investments in asset 
hardening or relocation) and to manage the consequences of such damage 
when it occurs (e.g., investments in system recoverability).\39\
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    \39\ R.M. Webb, M. Panfil, and S. Ladin, Climate Risk in the 
Electric Sector: Legal Obligations to Advance Climate Resilience 
Planning by Electric Utilities 10 (Dec. 2020), https://perma.cc/V25A-KBNP.
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    22. To be clear, we do not intend in this NOPR to require 
transmission providers to conduct extreme weather vulnerability 
assessments where they do not do so already, or to require transmission 
providers to change how they conduct or plan to do such 
assessments.\40\ Instead, the goal of this

[[Page 39419]]

proceeding is to gather information, not to establish new requirements. 
In addition, we do not propose that transmission providers submit the 
results of their extreme weather vulnerability assessments or include 
lists of affected assets and operations, specific vulnerabilities, or 
asset- or operation-specific mitigations in the informational reports 
proposed by this NOPR. Rather, we propose that the one-time 
informational reports focus on describing the current or planned 
policies and processes that respondents have in place, or plan to 
implement, to assess and mitigate extreme weather risks. We believe 
that this focus of the proposed one-time informational reports should 
avoid the need for respondents to file Critical Energy/Electric 
Infrastructure Information. However, to the extent transmission 
providers believe that information they will submit warrants 
protections, they may make a request for such treatment pursuant to 
Sec. Sec.  388.112 and 388.113 of the Commission's regulations.\41\
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    \40\ Similarly, while we propose that transmission providers may 
describe what they ``plan'' to do with respect to various issues, 
this is meant only to capture plans that have been made, but not yet 
been implemented; transmission providers are not required to 
speculate on how they would conduct extreme weather vulnerability 
analysis where they have no plans to do so.
    \41\ 18 CFR 388.112-113. Section 388.112 of the Commission's 
regulations specifies that any person submitting a document to the 
Commission may request privileged treatment for some or all of the 
information contained in a particular document that it claims is 
exempt from the mandatory public disclosure requirements of the 
Freedom of Information Act, and that should be withheld from public 
disclosure. See 5 U.S.C. 552. Section 388.113 of the Commission's 
regulations governs the procedures for submitting, designating, 
handling, sharing, and disseminating Critical Energy/Electric 
Infrastructure Information submitted to or generated by the 
Commission.
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    23. Although commenters in Docket No. AD21-13-000 have referenced 
previously published guidance on conducting vulnerability 
assessments,\42\ insufficient data exists to establish best practices. 
Therefore, we seek comments on our approach in directing such one-time 
informational reports, the proposed topics and questions discussed 
below, and the burden associated with submitting these reports. As 
further described below, we propose the one-time reports to address: 
(1) Scope; (2) Inputs; (3) Vulnerabilities and Exposure to Extreme 
Weather Hazards; (4) Costs of Impacts; and (5) Risk Mitigation.
---------------------------------------------------------------------------

    \42\ Department of Energy, Office of Energy Policy and Systems 
Analysis, Climate Change and the Electricity Sector: Guide for 
Climate Resilience Planning (Sept. 2016), https://toolkit.climate.gov/sites/default/files/Climate%20Change%20and%20the%20Electricity%20Sector%20Guide%20for%20Climate%20Change%20Resilience%20Planning%20September%202016_0.pdf 
(DOE Guide); CPUC, Climate Adaptation in the Electric Sector: 
Vulnerability Assessments & Resiliency Plans (Jan 2016), https://perma.cc/R6NW-F6GV (CPUC Guide); J. Gundlach and R. Webb, Climate 
Change Impacts on the Bulk Power System: Assessing Vulnerabilities 
and Planning for Resilience (Feb 2018), http://columbiaclimatelaw.com/files/2018/02/Gundlach-Webb-2018-02-CC-Bulk-Power-System.pdf.
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    24. While not all extreme weather vulnerability assessments must 
follow the same processes or include the same analyses, we understand 
the aforementioned topics to reflect typical practices and 
considerations in the development of extreme weather vulnerability 
assessments. Therefore, should respondents' processes and policies for 
developing their own extreme weather vulnerability assessments differ 
from those we describe below, we propose to require that transmission 
providers still describe in their one-time reports the processes and 
policies which most closely align with the intent or aim of the topics 
discussed below.

A. Scope

1. Background
    25. Determining the scope of an extreme weather vulnerability 
assessment depends on the breadth of assets, operations, and extreme 
weather hazards that a transmission provider faces in its specific 
area. A narrower scope (i.e., examining a subset of assets and 
operations, extreme weather hazards, or geographic regions in greater 
depth) can produce important insights related to specific facilities, 
systems, or regions, whereas a broader scope is more likely to identify 
system- and company-wide risks. For example, although Hurricane Sandy 
in 2012 initially motivated Consolidated Edison, Inc. (ConEd) to 
conduct its 2019 climate change vulnerability assessment, ConEd sought 
in its study to understand the broader impact of a changing climate on 
its service area and identified additional climate vulnerabilities 
including sea level rise, inland flooding due to increased 
precipitation, and extreme heat events.\43\
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    \43\ ConEd, Climate Change Vulnerability Study 4 (Dec. 2019), 
https://www.coned.com/-/media/files/coned/documents/our-energy-future/our-energy-projects/climate-change-resiliency-plan/climate-change-vulnerability-study.pdf.
---------------------------------------------------------------------------

    26. As part of scoping the extreme weather vulnerability 
assessment, transmission providers have the flexibility to choose the 
assets and operations to examine for their assessment. For example, 
some transmission providers focus their analyses on assets and 
operations related to critical electric infrastructure and/or assets 
and operations that meet or exceed some MW or other threshold.\44\ 
Furthermore, transmission providers may use discretion to determine 
what extreme weather hazards and geographic scope to consider in their 
vulnerability assessment. Transmission providers could also consider 
external vulnerabilities in their assessment, such as those related to 
consumers, interconnected utilities, and supply chains. For example, 
with respect to external vulnerabilities, PG&E examined not only its 
own assets, but upstream interdependencies, including regional bulk 
electric and natural gas systems, water availability, telecommunication 
utilities, and supply chains, as well as downstream interdependencies 
like community- and customer-level resiliency.\45\ With respect to 
geographic scope, although Entergy's service territory and assets 
extend across multiple states, its assessment, conducted with partners, 
focused exclusively on the 77 counties bordering the Gulf of Mexico. 
This specific geographic scope allowed Entergy and its partners to 
study the hazards unique to the Gulf region, driven by sea level rise, 
land subsidence, and increasing hurricane intensity.\46\ A wider 
geographic scope may consider wide-area and long duration extreme 
weather events, such as the August 2020 West-wide extreme heat event 
described above.
---------------------------------------------------------------------------

    \44\ National Grid and Dominion Energy Virginia, for example, 
have focused specifically on substation flooding risk resulting from 
sea level rise and severe storms because of the relatively higher 
impact of substation loss compared to other assets like individual 
distribution lines. DOE Office of Energy Policy and Systems 
Analysis, A Review of Climate Change Vulnerability Assessment: 
Current Practices and Lessons Learned from DOE's Partnership for 
Energy Sector Climate Resilience 8 (May 2016), https://toolkit.climate.gov/sites/default/files/A%20Review%20of%20Climate%20Change%20Vulnerability%20Assessments%20Current%20Practices%20and%20Lessons%20Learned%20from%20DOEs%20Partnership%20for%20Energy%20Sector%20Climate%20Resilience.pdf (DOE 
Vulnerability Assessment Review).
    \45\ PG&E, Climate Change Vulnerability Assessment and 
Resilience Strategies 18 (Nov. 2016), https://www.pgecurrents.com/wp-content/uploads/2016/12/PGE_climate_resilience_report.pdf.
    \46\ Entergy, Building a Resilient Gulf Coast: Executive Report 
(2010), https://www.entergy.com/userfiles/content/our_community/environment/GulfCoastAdaptation/Building_a_Resilient_Gulf_Coast.pdf.
---------------------------------------------------------------------------

    27. Finally, a transmission provider may engage a broad set of 
stakeholders early in the scoping process to identify particularly 
susceptible regions in their footprint and increase support for any 
resilience actions that result from the extreme weather vulnerability 
assessment.\47\ The Oregon Department of Energy, for example, engaged 
stakeholders from vulnerable and underserved communities in its climate

[[Page 39420]]

vulnerability assessment in order to incorporate equity concerns and 
examine the extent to which underserved and vulnerable groups are 
disproportionately impacted by these risks.\48\
---------------------------------------------------------------------------

    \47\ DOE Guide at 8-15.
    \48\ Oregon Department of Energy, 2020 Biennial Energy Report 28 
(Nov. 2020), https://www.oregon.gov/energy/Data-and-Reports/Documents/2020-Biennial-Energy-Report.pdf.
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2. Proposal
    28. As a threshold matter, we propose that each transmission 
provider state whether it conducts extreme weather vulnerability 
analyses. Further, we propose to require each transmission provider to 
provide the following information on the policies and processes they 
employ, or plan to employ, for determining the scope of extreme weather 
vulnerability assessments:
    (Q1) A description of the types of extreme weather events for which 
the transmission provider conducts, or plans to conduct, extreme 
weather vulnerability assessments, if any. For transmission providers 
that conduct, or plan to conduct, such assessments, a description of 
how the transmission provider determined which extreme weather hazards 
to include in the assessment (e.g., extreme storms such as hurricanes 
and the associated flooding and high winds, wildfires, extreme 
prolonged heat or cold, or drought conditions);
    (Q2) A description of how the transmission provider selects, or 
plans to select, the set of assets and operations that will be 
examined;
    (Q3) A description of how the transmission provider determines, or 
plans to determine, the geographic or regional scope of the analysis;
    (Q4) A description of whether and to what extent the transmission 
provider considers, or plans to consider, external interdependencies, 
such as interconnected utilities, other critical infrastructure sectors 
(e.g., water, telecommunications) and supply chain-related 
vulnerabilities, in the assessment;
    (Q5) A description of whether and to what extent the transmission 
provider coordinates, or plans to coordinate, with neighboring 
utilities and/or entities in other sectors that could potentially be 
relevant to the assessment;
    (Q6) A description of whether and to what extent the transmission 
provider engages, or plans to engage, with stakeholders in the scoping 
phase of the assessment, including the processes used to identify and 
engage relevant stakeholder groups and incorporate stakeholder feedback 
into the extreme weather vulnerability assessment, especially with 
regard to disadvantaged or vulnerable communities.

B. Inputs

1. Background
    29. As noted above, the processes for conducting extreme weather 
vulnerability assessments may vary; however, there are several types of 
key inputs that are likely to be part of such assessments. First, most 
assessments require meteorological data that support and describe how 
the extreme weather hazards selected for study during the scoping phase 
may specifically manifest in the study region (e.g., local storm surge 
projections for the next 50 years, historical drought data, projected 
temperature data). In some cases, such data may be readily available, 
or in cases where existing extreme weather projections are inadequate 
to support a transmission provider's vulnerability assessment, new 
projections may be generated by consulting a modeling group (typically 
academic institutions or consulting firms).
    30. Second, transmission providers can elect to use scenario 
analyses to explore how the set of potentially vulnerable assets and 
operations may vary across a range of assumed extreme weather hazards 
and other modeling inputs. Transmission providers may opt to study a 
single scenario or multiple scenarios based on previous modeling 
efforts; for example, in its internal climate vulnerability assessment, 
San Diego Gas & Electric Company (SDG&E) compiled multiple projections 
for temperature, rainfall patterns, drought, and sea level rise in its 
service territory to explore potential impacts in 2050 and 2100.\49\ 
Alternatively, transmission providers may take a probabilistic approach 
whereby probability distributions are developed and forecast for each 
parameter (e.g., precipitation, windspeed). This approach is more 
computationally advanced but can help produce granular, quantitative 
risk assessments that capture a wider range of potential variation and 
outcomes.
---------------------------------------------------------------------------

    \49\ DOE Vulnerability Assessment Review at 14.
---------------------------------------------------------------------------

    31. Third, the relevant attributes of the assets and operations 
that will be studied are additional key inputs into an extreme weather 
vulnerability assessment that may affect whether, and to what extent, 
these assets and operations exhibit vulnerabilities under the 
conditions being studied. For example, the potential vulnerability of a 
transmission tower to extreme wind may vary based on its height, age, 
and other known or foreseeable parameters. Example asset attributes 
could include, among others, age, design lifetime, location, elevation, 
and replacement costs, while example operations attributes could 
include type and number of staff, locations of critical staff and 
facilities, and maintenance schedules.
    32. Fourth, transmission providers have the flexibility to decide 
the timeframe(s) to be considered by the vulnerability assessment 
(e.g., the next 10 years, or a sampling of specific one-year 
periods).\50\ The selected timeframe(s) may affect or be affected by 
the transmission provider's choices with other study inputs (e.g., 
relevant datasets may not be available for a study of potential 
vulnerabilities 100 years into the future).
---------------------------------------------------------------------------

    \50\ For example, in their internal climate vulnerability 
assessments, Entergy studied the following 45 years while Seattle 
City Light studied years 2030 and 2050. Id. at 6.
---------------------------------------------------------------------------

    33. Lastly, if transmission providers analyze the potential 
financial implications of extreme weather impacts, they could use a 
discount rate that will convert the costs of potential impacts on 
identified vulnerable assets and operations at different points in time 
into equivalent values in a base year (i.e., present dollars).\51\ 
Discount rates could also inform transmission provider efforts to 
compare the costs of extreme weather events to the benefits of 
mitigation actions over time.
---------------------------------------------------------------------------

    \51\ William Pizer and Richard Newell, Discounting the Benefits 
of Climate Change Mitigation: How Much Do Uncertain Rates Increase 
Valuations? 2 (Dec. 2001), https://www.c2es.org/wp-content/uploads/2001/12/econ_discounting.pdf.
---------------------------------------------------------------------------

2. Proposal
    34. We propose to direct each transmission provider to provide the 
following information about the inputs it uses, or plans to use, for 
any extreme weather vulnerability assessments.
    (Q9) A description of methods and processes the transmission 
provider uses, or plans to use, to determine the meteorological data 
needed for its assessment. In particular, how the transmission provider 
determines whether it can rely on existing extreme weather projections, 
and if so, whether such projections are adequately robust;
    (Q10) A description of how the transmission provider determines 
whether to use scenario analysis, and if so, whether to do so with 
multiple scenarios;
    (Q11) The extent to which it reviews neighboring transmission 
providers' extreme weather vulnerability assessments, if available, to 
evaluate the consistency of extreme weather

[[Page 39421]]

projections between transmission providers;
    (Q12) The timeframe(s) and discount rate(s) selected for the 
extreme weather vulnerability assessment;
    (Q13) A description of the methods and processes the transmission 
provider uses, or plans to use, to create an inventory of potentially 
vulnerable assets and operations.

C. Vulnerabilities and Exposure to Extreme Weather Hazards

1. Background
    35. Extreme weather vulnerability assessments can include an 
analysis of the assets or operations exposed to the types of extreme 
weather hazards established in the assessment's scope (e.g., hurricanes 
and associated flooding, and high winds, wildfires, extreme prolonged 
heat or cold, drought conditions), the sensitivities of transmission 
assets and operations to extreme weather events, and the magnitude of 
any impacts to the transmission system caused by extreme weather 
events. In assessing the exposure to extreme weather events, 
transmission providers may estimate the likelihood and extent of damage 
or disruption to their transmission assets and operations if various 
extreme weather events occur.
    36. In extreme weather vulnerability assessments, transmission 
providers generally use probability distributions or other quantitative 
estimates to examine how a particular asset or operation would be 
affected under a specific extreme weather event or combination of 
events.\52\ The sensitivity of an asset or operation to a specific 
extreme weather event depends on both the type and severity of the 
event (e.g., the force of a wave during a hurricane or temperature 
during a heat wave) and the type, configuration, or attributes of the 
asset or operation itself (e.g., the physical resilience of a 
transmission tower to increased wind speeds or wave force).\53\ In 
cases where it is difficult to estimate the likelihood or severity of 
damage or disruption given the occurrence of an extreme weather impact, 
transmission providers may provide a best estimate.
---------------------------------------------------------------------------

    \52\ CPUC Guide at 15.
    \53\ DOE Guide at 39.
---------------------------------------------------------------------------

    37. Rather than attempting to analyze the likelihood of damage, 
disruption or failure for all transmission assets and operations, 
transmission providers may instead use a screening analysis to identify 
critical thresholds at which extreme weather hazard(s) would likely 
render an asset or operation vulnerable based on the relevant 
attributes determined in the sensitivity analysis. If a screening 
analysis identifies potential vulnerabilities among assets and 
operations considered especially significant or critical, transmission 
providers conducting vulnerability assessments could supplement their 
analysis with a more detailed review of the specific assets and 
operations.
    38. Once these vulnerabilities are identified, transmission 
providers may estimate the magnitude of the impacts that would cause 
damage or disruption to assets or operations triggered by various 
extreme weather hazards. For example, NERC acknowledges that various 
conditions could lead to loss of resources, including extreme cold 
temperatures and wind that can cause wellhead, processing plant, or 
compressor station freezing or ambient temperature conditions that are 
outside the operating temperatures for the asset.\54\
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    \54\ NERC Post-Conference Comments at 6.
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2. Proposal
    39. We propose to direct each transmission provider to provide the 
following information about the methods or processes it uses, or plans 
to use, in its extreme weather vulnerability assessment to assess the 
vulnerability of its transmission assets and operations to extreme 
weather events.
    (Q14) A description of how the transmission provider identifies the 
transmission assets or operations vulnerable to the extreme weather 
events for which it conducts assessments;
    (Q15) A description of how the transmission provider uses, or plans 
to use, screening analyses to test for potential vulnerabilities, as 
well as how the transmission provider examines, or plans to examine, 
the sensitivities of the transmission assets and operations being 
studied to types and magnitudes of extreme weather events.

D. Costs of Impacts

1. Background
    40. The aggregate economic effects of climate change and extreme 
weather on energy infrastructure could be trillions of dollars over the 
next few decades, including the costs of power outages to utility 
customers and costs to rebuild from storm damage, among others.\55\ 
These costs are a function of the estimated exposure of the impacted 
assets, their geographical locations, the severity of associated 
extreme weather impacts, other potential location-specific factors, and 
the study's timeframe and assumed discount rate (used for converting 
costs to net present value). These costs may be further broken up into 
direct and indirect costs.
---------------------------------------------------------------------------

    \55\ GAO Report at 19; Deloitte, The Turning Point: A New 
Economic Climate in the United States 15 (Jan. 2022), https://www2.deloitte.com/content/dam/Deloitte/us/Documents/about-deloitte/us-the-turning-point-a-new-economic-climate-in-the-united-states-january-2022.pdf.
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    41. In this proceeding, we define direct costs as the economic 
losses borne by the transmission provider. Direct costs may include 
expenditures and administrative and labor costs associated with 
responding to and resolving extreme weather impacts, such as the costs 
of repairing, replacing, or relocating an asset. Direct costs may also 
include the transmission provider's opportunity costs of lost sales 
during an outage.\56\ Transmission providers may arrive at a rough 
estimate of direct costs by assuming that impacted vulnerable assets 
would be damaged beyond repair and calculating their associated 
replacement costs. Alternatively, a more detailed analysis could 
examine how costs vary as a function of impact severity for specific 
assets and operations.\57\
---------------------------------------------------------------------------

    \56\ DOE Guide at 43.
    \57\ Id. at 44.
---------------------------------------------------------------------------

    42. Depending on the scope of the extreme weather vulnerability 
assessment, transmission providers may also consider indirect costs, 
which we define in this proceeding as costs associated with loss of 
service to utility customers.\58\ For example, relevant indirect costs 
may include equipment damage, spoilage, and health and safety 
effects.\59\ Value of lost load calculations, which estimate the value 
that customers place on reliable electricity service, are a common 
method for quantitatively estimating indirect costs.\60\
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    \58\ Relatedly, transmission providers may also consider induced 
costs that do not directly affect their ratepayers, such as 
increased prices for consumer goods and effects on interdependent 
sectors like water and transportation. However, we assume that 
induced costs would likely be beyond the scope of most transmission 
providers' extreme weather vulnerability assessments because they do 
not directly affect ratepayers or the prudence of transmission 
provider investments. Id. at 45.
    \59\ Id. at 45-46.
    \60\ See, e.g., Wholesale Competition in Regions with Organized 
Electric Markets, Order No. 719, 73 FR 64100 (Oct. 28, 2008), 125 
FERC ] 61,071, at P 208 (2008) (describing the Commission's 
contemplated reforms ``to ensure that the market price for energy 
accurately reflects the value of such energy during an operating 
reserve shortage'').
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2. Proposal
    43. We propose to direct each transmission provider to provide the 
following information on how it estimates, or plans to estimate, the 
costs associated with extreme weather

[[Page 39422]]

impacts in its extreme weather vulnerability assessments:
    (Q16) A description of the methodology or process, if any, the 
transmission provider uses, or plans to use, to estimate the potential 
costs of extreme weather impacts on identified vulnerable assets and 
operations;
    (Q17) If the transmission provider estimates such potential costs, 
a description of the types of: (a) direct costs, such as replacements 
or repair costs, restoration costs, associated labor costs, or 
opportunity costs of lost sales, and (b) indirect costs, such as costs 
associated with loss of service to electric customers and other 
utilities that purchase power from the transmission provider, including 
equipment damage, spoilage, and health and safety effects,\61\ in 
calculating the costs of extreme weather impacts.
---------------------------------------------------------------------------

    \61\ DOE Guide at 43-46.
---------------------------------------------------------------------------

E. Risk Mitigation

1. Background
    44. In general, the overall vulnerability of the transmission 
system is a function of the estimated exposure of vulnerable assets and 
operations to extreme weather threats and the estimated impact of those 
threats. For example, the failure of an asset that is highly exposed to 
a particular extreme weather risk may not materially increase the 
overall vulnerability of the system if there are other redundant assets 
that perform similar system functions. Conversely, the failure of a 
pivotal asset (i.e., not backed by redundant assets) with relatively 
low exposure to a particular extreme weather risk may nonetheless pose 
significant operational challenges if such failure were to occur.
    45. Some transmission providers consider the potential degradation 
or failure of key assets and operations due to various extreme weather 
threats by using likelihood-consequence matrices to categorize 
vulnerable assets and operations based on: (1) the likelihood that the 
asset or operation is impacted by an extreme weather event or change in 
climatic parameter (e.g., severe storms and flooding, ambient heat 
increase, sea-level rise); and (2) the estimated associated 
consequences for overall system performance. This approach can reveal 
the need to replace certain assets, deficiencies in current asset and 
operational performance standards, or the potential for stranded 
assets.\62\
---------------------------------------------------------------------------

    \62\ CPUC Guide at 15-16.
---------------------------------------------------------------------------

    46. Under this approach, transmission providers may further define 
illustrative anchors for these categories to foster a consistent 
interpretation under this approach. For example, Public Service 
Electric & Gas Company (PSE&G) chose to map vulnerabilities onto a 
likelihood-consequence matrix composed of six likelihood categories--
with its highest likelihood category as those events expected to occur 
more than once per year, and its lowest likelihood category as those 
which are expected to never occur--and six consequence categories 
(`inconsequential,' `minimal,' `minor,' `moderate,' `considerable,' and 
`severe').\63\ PSE&G then assigned numeric ratings to each likelihood 
and consequence category and scored each extreme weather vulnerability 
by multiplying the two ratings together. This approach enabled PSE&G to 
rank the severity of extreme weather and climate risks to its assets 
and further prioritize actions to mitigate these risks.\64\
---------------------------------------------------------------------------

    \63\ DOE Vulnerability Assessment Review at 16-17.
    \64\ Id.
---------------------------------------------------------------------------

    47. After assessing the relative risks to assets and operations, 
the transmission provider can then determine appropriate mitigation. 
Example solutions for mitigating risks to vulnerable assets may include 
hardening or relocating, while example solutions for mitigating risks 
to vulnerable operations may include improved load management practices 
that reduce outages and expedite restoration.
2. Proposal
    48. We propose to direct each transmission provider to provide the 
following information on the processes and policies it uses, or plans 
to use, to determine and implement appropriate measures for mitigating 
extreme weather risks identified in its extreme weather vulnerability 
assessment:
    (Q18) A description of how the transmission provider uses, or plans 
to use, the results of its assessment to develop measures to mitigate 
extreme weather risks, including:
    i. How the transmission provider determines which risks should be 
mitigated and the appropriate time horizon for mitigation;
    ii. How the transmission provider determines appropriate extreme 
weather risk mitigation measures, including any analyses used to 
determine the lowest-cost or most impactful portfolio of measures;
    (Q19) A description of how the transmission provider informs, or 
plans to inform, relevant stakeholders--such as neighboring 
transmission providers, RTOs/ISOs of which the transmission provider is 
a member, electric customers, affected and frontline communities, 
shareholders and investors, emergency management agencies, local and 
state administrations, and state utility regulators--of identified 
extreme weather risks and selected mitigation measures;
    (Q20) A description of the extent to which the transmission 
provider incorporates, or plans to incorporate, identified extreme 
weather risks and mitigation measures into local and regional 
transmission planning processes;
    (Q21) A description of how the transmission provider measures, or 
plans to measure, the progress and success of extreme weather risk 
mitigation measures (e.g., through reduced outages) and how it 
incorporates these observations into ongoing and future extreme risk 
mitigation actions.

IV. Information Collection Statement

    49. The information collection requirements contained in this NOPR 
are subject to review by the Office of Management and Budget (OMB) 
under section 3507(d) of the Paperwork Reduction Act of 1995.\65\ OMB's 
regulations require approval of certain information collection 
requirements imposed by agency rules.\66\ Upon approval of a collection 
of information, OMB will assign an OMB control number and an expiration 
date. Respondents subject to the filing requirements of a rule will not 
be penalized for failing to respond to the collection of information 
unless the collection of information displays a valid OMB control 
number.
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    \65\ 44 U.S.C. 3507(d).
    \66\ 5 CFR 1320.11 (2021).

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[[Page 39423]]

    50. This NOPR would, pursuant to Sec.  304 of the FPA, require 
transmission providers \67\ to file one-time reports on their extreme 
weather vulnerability assessment practices. The Commission believes 
requiring transmission providers to submit a one-time informational 
report on their current or planned efforts to assess the 
vulnerabilities of their jurisdictional transmission assets and 
operations to extreme weather events will assist in the proper 
administration of the FPA.
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    \67\ As noted above, in this NOPR, unless otherwise noted, we 
use the term ``transmission provider'' to mean any public utility 
that owns, controls, or operates facilities used for the 
transmission of electric energy in interstate commerce. See 16 
U.S.C. 824(e); 18 CFR 35.28. To be clear, this term encompasses 
public utility transmission owners that are members of RTOs/ISOs. 
Accordingly, the reports we are proposing herein would be filed by 
the public utility members of RTOs/ISOs, as well as by the RTOs/ISOs 
themselves and other public utility transmission providers.
---------------------------------------------------------------------------

    Title: One-Time Informational Reports on Extreme Weather 
Vulnerability Assessments.
    Action: Proposed FERC-1004 collection of information in accordance 
with Docket Nos. RM22-16-000 and AD21-13-000.
    OMB Control No.: 1902-TBD.
    Respondents: Transmission providers (including public utility 
transmission owners that are members of RTOs/ISOs and the RTOs/ISOs 
themselves).
    Frequency of Information Collection: One time.
    Necessity of Information: The Commission seeks to address the 
increasing risks of extreme weather to bulk electric system reliability 
and jurisdictional rates, and to better understand how transmission 
providers assess and mitigate those risks. The Commission believes the 
informational reports directed by this Proposed Rulemaking will allow 
it to determine whether additional action on extreme weather 
vulnerability assessments is needed and assist the Commission in the 
proper administration of the FPA.
    Internal Review: The Commission has reviewed the reporting 
requirement and has determined that such a requirement is necessary. 
These requirements conform to the Commission's need for efficient 
information collection, communication, and management within the energy 
industry. The Commission has specific, objective support for the burden 
estimates associated with the information collection requirements. 
Interested persons may obtain information on the reporting requirements 
by contacting Ellen Brown, Office of the Executive Director, Federal 
Energy Regulatory Commission, 888 First Street NE, Washington, DC 20426 
via email (<a href="/cdn-cgi/l/email-protection#4b0f2a3f2a08272e2a392a25282e0b2d2e3928652c243d"><span class="__cf_email__" data-cfemail="1b5f7a6f7a58777e7a697a75787e5b7d7e6978357c746d">[email protected]</span></a>) or telephone ((202) 502-8663).
    51. The Commission solicits comments on its need for this 
information; whether the information will have practical utility; the 
accuracy of the burden estimates; ways to enhance the quality, utility, 
and clarity of the information to be collected or retained; and any 
suggested methods for minimizing respondents' burden, including the use 
of automated information techniques.
    52. Please send comments concerning the collection of information 
and the associated burden estimate to the Office of Information and 
Regulatory Affairs, Office of Management and Budget, through 
www.reginfo.gov/public/do/PRAMain, Attention: Federal Energy Regulatory 
Commission Desk Officer. Please identify FERC-1004 and OMB Control 
Number 1902-TBD in the subject line of your comments. Comments should 
be sent within 60 days of publication of this notice in the Federal 
Register.
    53. Please submit a copy of your comments on the information 
collection to the Commission via the eFiling link on the Commission's 
website at http://www.ferc.gov. Comments on the information collection 
that are sent to FERC should refer to Docket Nos. RM22-16-000 and AD21-
13-000.
    54. Public Reporting Burden: Our estimates are based on the NERC 
Compliance Registry as of May 6, 2022 and each RTO/ISO's list of 
participating transmission owners per their websites, which indicates 
that there are 49 transmission providers \68\ (including the six RTOs/
ISOs) and 83 transmission owners that are registered with NERC within 
the United States and are subject to this proposed rulemaking.\69\
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    \68\ The transmission service provider (TSP) function is a NERC 
registration function which is similar to the transmission provider 
that is referenced in the pro forma Open Access Transmission Tariff. 
The TSP function is being used as a proxy to estimate the number of 
transmission providers that are impacted by this proposed 
rulemaking.
    \69\ The number of entities listed from the NERC Compliance 
Registry reflects the omission of the Texas RE registered entities.
---------------------------------------------------------------------------

    55. The Commission estimates that the burden \70\ and cost of the 
proposed FERC-1004 are as follows:
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    \70\ ``Burden'' is the total time, effort, or financial 
resources expended by persons to generate, maintain, retain, or 
disclose or provide information to or for a Federal agency. For 
further explanation of what is included in the information 
collection burden, refer to 5 CFR 1320.3.
    \71\ Commission staff estimates that respondents' hourly wages 
plus benefits are comparable to those of FERC employees. Therefore, 
the hourly cost used in this analysis is $87.00 (or $180,703 per 
year).
    \72\ The number of entities listed from the NERC Compliance 
Registry reflects the omission of the Texas RE registered entities.

                      FERC-1004, as Proposed in NOPR in Docket Nos. RM22-16-000 and AD21-13
----------------------------------------------------------------------------------------------------------------
                                                      C.  Annual
                                                      estimated                             E.  Total estimated
                                B.  Annual number     number of       D.  Average burden   burden hours &  total
   A.  Area of modification       of respondents     responses (1     hours & cost \71\        estimated cost
                                                         per             per response      (Column C x Column D)
                                                     respondent)
----------------------------------------------------------------------------------------------------------------
Report on Extreme Weather       132 (49 TPs \72\              132   Year 1: 99 hours;      Year 1: 13,068 hours;
 Vulnerability Assessment (one-  and 83 TOs).                        $8,613.00.             $1,136,916
 time).                                                             Subsequent Years: 0    Subsequent Years: 0
                                                                     hours per year; $0..   hours per year; $0.
----------------------------------------------------------------------------------------------------------------

V. Environmental Analysis

    56. The Commission is required to prepare an Environmental 
Assessment or an Environmental Impact Statement for any action that may 
have a significant adverse effect on the human environment.\73\ The 
actions proposed to be taken here fall within categorical exclusions in 
the Commission's regulations for rules regarding information gathering, 
analysis, and dissemination, and for rules regarding sales, exchange, 
and transportation of natural gas that require no construction of 
facilities.\74\ Therefore, an environmental review is unnecessary and 
has not been prepared in this rulemaking.
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    \73\ Reguls. Implementing the Nat'l Env'tal Pol'y Act, Order No. 
486, 52 FR 47,897 (Dec. 17, 1987), FERC Stats. & Regs. ] 30,783 
(1987) (cross-referenced at 41 FERC ] 61,284).
    \74\ See 18 CFR 380.4(a)(2)(ii), 380.4(a)(5), 380.4(a)(27).

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[[Page 39424]]

VI. Regulatory Flexibility Act

    57. The Regulatory Flexibility Act of 1980 (RFA) \75\ generally 
requires a description and analysis of proposed rules that will have 
significant economic impact on a substantial number of small entities. 
The RFA mandates consideration of regulatory alternatives that 
accomplish the stated objectives of a proposed rule and minimize any 
significant economic impact on a substantial number of small 
entities.\76\ The Small Business Administration (SBA) sets the 
threshold for what constitutes a small business. Under SBA's size 
standards,\77\ transmission providers (including RTOs/ISOs) and 
transmission owners fall under the category of Electric Bulk Power 
Transmission and Control (NAICS code 221121),\78\ with a size threshold 
of 500 employees (including the entity and its associates).\79\
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    \75\ 5 U.S.C. 601-612.
    \76\ Id. 603(c).
    \77\ 13 CFR 121.201.
    \78\ The North American Industry Classification System (NAICS) 
is an industry classification system that Federal statistical 
agencies use to categorize businesses for the purpose of collecting, 
analyzing, and publishing statistical data related to the U.S. 
economy. United States Census Bureau, North American Industry 
Classification System, https://www.census.gov/eos/www/naics/.
    \79\ The threshold for the number of employees indicates the 
maximum allowed for a concern and its affiliates to be considered 
small. 13 CFR 121.201.
---------------------------------------------------------------------------

    58. We estimate that there are 132 total transmission providers and 
owners that (not including the six RTOs/ISOs) are affected by the NOPR.
    59. The six RTOs/ISOs (SPP, MISO, PJM, ISO-NE, NYISO, and CAISO) 
each employ more than 500 employees and are not considered small 
entities.
    60. Using the list of transmission service providers from the NERC 
Registry (dated May 6, 2022), we estimate that approximately 30% of 
those entities are small entities. We estimate an additional average 
one-time cost of $8,613.00 for each of the 132 entities affected by the 
NOPR.
    61. According to SBA guidance, the determination of significance of 
impact ``should be seen as relative to the size of the business, the 
size of the competitor's business, and the impact the regulation has on 
larger competitors.'' \80\ We do not consider the estimated cost to be 
a significant economic impact. As a result, pursuant to section 605(b) 
of the RFA,\81\ the Commission certifies that the proposals in this 
NOPR will not have a significant economic impact on a substantial 
number of small entities.
---------------------------------------------------------------------------

    \80\ U.S. Small Business Administration, A Guide for Government 
Agencies How to Comply with the Regulatory Flexibility Act 18 
(August 2017), https://cdn.advocacy.sba.gov/wp-content/uploads/2019/06/21110349/How-to-Comply-with-the-RFA.pdf.
    \81\ 16 U.S.C. 605(b).
---------------------------------------------------------------------------

VII. Comment Procedures

    62. The Commission invites interested persons to submit comments on 
the matters and issues proposed in this notice to be adopted, including 
any related matters or alternative proposals that commenters may wish 
to discuss. Comments are due August 30, 2022. Comments must refer to 
Docket Nos. RM22-16-000 and AD21-13-000, and must include the 
commenter's name, the organization they represent, if applicable, and 
their address in their comments. All comments will be placed in the 
Commission's public files and may be viewed, printed, or downloaded 
remotely as described in the Document Availability section below. 
Commenters on this proposal are not required to serve copies of their 
comments on other commenters.
    63. The Commission encourages comments to be filed electronically 
via the eFiling link on the Commission's website at http://www.ferc.gov. The Commission accepts most standard word processing 
formats. Documents created electronically using word processing 
software must be filed in native applications or print-to-PDF format 
and not in a scanned format. Commenters filing electronically do not 
need to make a paper filing.
    64. Commenters that are not able to file comments electronically 
may file an original of their comment by USPS mail or by courier-or 
other delivery services. For submission sent via USPS only, filings 
should be mailed to: Federal Energy Regulatory Commission, Office of 
the Secretary, 888 First Street NE, Washington, DC 20426. Submission of 
filings other than by USPS should be delivered to: Federal Energy 
Regulatory Commission, 12225 Wilkins Avenue, Rockville, MD 20852.

VIII. Document Availability

    65. In addition to publishing the full text of this document in the 
Federal Register, the Commission provides all interested persons an 
opportunity to view and/or print the contents of this document via the 
internet through the Commission's Home Page (http://www.ferc.gov). At 
this time, the Commission has suspended access to the Commission's 
Public Reference Room due to the President's March 13, 2020 
proclamation declaring a National Emergency concerning the Novel 
Coronavirus Disease (COVID-19).
    66. From the Commission's Home Page on the internet, this 
information is available on eLibrary. The full text of this document is 
available on eLibrary in PDF and Microsoft Word format for viewing, 
printing, and/or downloading. To access this document in eLibrary, type 
the docket number excluding the last three digits of this document in 
the docket number field.
    67. User assistance is available for eLibrary and the Commission's 
website during normal business hours from the Commission's Online 
Support at (202) 502-6652 (toll free at 1-866-208-3676) or email at 
<a href="/cdn-cgi/l/email-protection#2b4d4e594844454742454e585e5b5b44595f6b4d4e5948054c445d"><span class="__cf_email__" data-cfemail="85e3e0f7e6eaebe9ecebe0f6f0f5f5eaf7f1c5e3e0f7e6abe2eaf3">[email protected]</span></a>, or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at 
<a href="/cdn-cgi/l/email-protection#8dfdf8efe1e4eea3ffe8ebe8ffe8e3eee8ffe2e2e0cdebe8ffeea3eae2fb"><span class="__cf_email__" data-cfemail="39494c5b55505a174b5c5f5c4b5c575a5c4b565654795f5c4b5a175e564f">[email protected]</span></a>.

    By direction of the Commission. Commissioner Danly is concurring 
with a separate statement attached.

    Issued: June 16, 2022.
Debbie-Anne A. Reese,
Deputy Secretary.

United States of America

Federal Energy Regulatory Commission

    One-Time Informational Reports on Extreme Weather Vulnerability 
Assessments; Climate Change, Extreme Weather, and Electric System 
Reliability
Docket Nos. RM22-16-000, AD21-13-000
(Issued June 16, 2022)
    DANLY, Commissioner, concurring:

    1. I concur in today's notice of proposed rulemaking directing 
transmission providers to submit one-time informational reports 
describing their current or planned policies and processes for 
conducting weather assessments to identify where and under what 
conditions jurisdictional transmission assets and operations are at 
risk from weather-related events, how those risks manifest, and their 
consequences for transmission system operations.\1\
---------------------------------------------------------------------------

    \1\ One-Time Informational Reports on Extreme Weather 
Vulnerability Assessments, 179 FERC ] 61,196 (2022) (NOPR).
---------------------------------------------------------------------------

    2. It will take over six months, at a minimum, from this NOPR to 
the filing of the informational reports. These informational reports 
will be filed long after this summer is over and will not, and indeed 
cannot, timely address the projected risk of widespread blackouts this 
summer.\2\ It is doubtful they will be

[[Page 39425]]

filed in time to take action, if gaps are identified, for the winter of 
2022-2023 either. Nonetheless, I agree that there is some value in 
understanding the extent to which, if any,\3\ transmission providers 
currently assess and mitigate the risks posed by weather-related 
events. I also agree that the informational reports may help us 
identify opportunities to avoid adverse rate impacts stemming from 
weather events, which is consistent with our obligations under the 
Federal Power Act.\4\
---------------------------------------------------------------------------

    \2\ Chairman Glick says that I am ``prone to hyperbole'' when I 
warn that blackouts are the likely outcome of the majority's 
misguided policies to prop up renewables at the expense of 
competitive markets and existing fossil resources. Rich Heidorn Jr., 
Summer Forecasts Spark Warnings of `Reliability Crisis' at FERC, RTO 
Insider (May 19, 2022), https://www.rtoinsider.com/articles/30170-summer-forecasts-spark-warnings-reliability-crisis-ferc. Chairman 
Glick appears to be confusing ``hyperbole'' with ``reality.'' 
California and Texas have already experienced blackouts. Over two-
thirds of the nation faces ``elevated [reliability] risk'' this 
summer. Ethan Howland, FERC commissioners respond to elevated power 
outage risks across two-thirds of US, Utility Dive (May 20, 2022), 
https://www.utilitydive.com/news/ferc-nerc-power-outage-risks-summer-drought/624111/ (``At its monthly meeting Thursday, Federal 
Energy Regulatory Commission members dissected the North American 
Electric Reliability Corp.'s warning that roughly two-thirds of the 
United States faces [sic] heightened risks of power outages this 
summer.'').
    \3\ The NOPR is clear that we do not intend in this NOPR to 
require transmission providers to conduct extreme weather 
vulnerability assessments where they do not do so already, or to 
require transmission providers to change how they conduct or plan to 
do such assessments. See NOPR, 179 FERC ] 61,196 at P 22; id. P 22 
n.40 (``Similarly, while we propose that transmission providers may 
describe what they `plan' to do with respect to various issues, this 
is meant only to capture plans that have been made, but not yet been 
implemented; transmission providers are not required to speculate on 
how they would conduct extreme weather vulnerability analysis where 
they have no plans to do so.'').
    \4\ See 16 U.S.C. 824d, 824e.
---------------------------------------------------------------------------

    3. The NOPR makes use of, indeed bases our action upon, an ever-
growing narrative: reliability challenges arise primarily from weather-
related events.\5\ But even if one were to grant that certain parts of 
the United States were experiencing statistically unusual weather when 
compared to historical baselines, that has absolutely nothing to do 
with whether the markets and regulated utilities are procuring 
sufficient generation of the correct type to ensure resource adequacy 
and system reliability. We cannot blame our problems on the weather. 
The problem is federal and state policies which, by mandate or subsidy, 
spur the development of weather dependent generation resources at the 
expense of the dispatchable resources needed for system stability and 
resource adequacy. This is seen in particularly stark terms in our 
markets in which subsidies, combined with failed market design, warp 
price signals. This destroys the incentives required to ensure the 
orderly entry, exit, and retention of the necessary quantities of the 
necessary types of generation. The thinner and thinner margins that 
result render the Bulk-Power System more and more susceptible to the 
caprices of weather. We have been warned by credible sources on the 
matter: NERC,\6\ the RTOs,\7\ and Commission staff.\8\
---------------------------------------------------------------------------

    \5\ See Chairman Glick (@RichGlickFERC), Twitter (May 19, 2022, 
11:13 a.m.), https://twitter.com/RichGlickFERC/status/1527306459263881223?s=20&t=3a4C-1cac3nmFkjZyvoUDA (``Extreme weather 
may be the single most important factor impacting #grid #reliability 
& the impacts of expected heat, drought, wildfires, hurricanes, & 
other events--all pose a big threat. Keeping eye on West, ERCOT, & 
parts of MISO this summer.''); Benjamin Mullin, Climate Change is 
Straining California's Energy System, Officials Say, N.Y. Times (May 
6, 2022), https://www.nytimes.com/2022/05/06/business/energy-environment/california-electricity-shortage.html.
    \6\ See generally North American Electric Reliability Corp., 
2022 Summer Reliability Assessment (May 2022), https://www.nerc.com/pa/RAPA/ra/Reliability%20Assessments%20DL/NERC_SRA_2022.pdf. In 
addition, NERC has warned that system operators in areas of 
significant amounts of solar photovoltaic (PV) resources should be 
aware of the potential for resource loss events during grid 
disturbances. Id. at 6. NERC has further warned that ``[i]ndustry 
experience with unexpected tripping of [Bulk-Power System]-connected 
solar PV generation units can be traced back to the 2016 Blue Cut 
fire in California, and similar events have occurred as recently as 
Summer 2021. A common thread with these events is the lack of 
inverter-based resource (IBR) ride-through capability causing a 
minor system disturbance to become a major disturbance. The latest 
disturbance report reinforces that improvements to NERC Reliability 
Standards are needed to address systemic issues with IBRs.'' Id. 
NERC also explains that ``because the electrical output of variable 
energy resources (e.g., wind, solar) depends on weather conditions, 
on-peak capacity contributions are less than nameplate capacity.'' 
Id. at 45.
    \7\ See, e.g., California Independent System Operator Corp., 
2022 Summer Loads and Resources Assessment (May 18, 2022), http://www.caiso.com/Documents/2022-Summer-Loads-and-Resources-Assessment.pdf; Midcontinent Independent System Operator (MISO), 
Lack of Firm generation may necessitate increased reliance on 
imports and use of emergency procedures to maintain reliability 
(Apr. 28, 2022), https://www.misoenergy.org/about/media-center/miso-projects-risk-of-insufficient-firm-generation-resources-to-cover-peak-load-in-summer-months/; PJM Interconnection, L.L.C. (PJM), 
Energy Transition in PJM: Frameworks for Analysis (Dec. 15, 2021), 
https://pjm.com/-/media/committees-groups/committees/mrc/2021/20211215/20211215-item-09-energy-transition-in-pjm-whitepaper.ashx 
(addressing renewable integration).
    \8\ See FERC Staff Presentation on 2022 Summer Energy Market and 
Reliability Assessment (AD06-3-000), FERC, at slide 9 (May 19, 
2022), https://www.ferc.gov/news-events/news/presentation-report-2022-summer-energy-market-and-reliability-assessment (identifying 
the Western U.S., Texas, MISO and Southwest Power Pool as ``[p]arts 
of North America are at elevated or high risk of energy shortfalls 
during peak summer conditions'') (emphasis in original); id. at 
slide 10 (In MISO, ``[g]eneration capacity declined 2.3% since 2021 
resulting in [a] lower reserve margin'' and the ``[n]orth and 
central areas [are] at risk of reserve shortfall in extreme 
temperatures, high generation outages, or low wind'' with ``[s]ome 
risk of insufficient operating reserves at normal peak demand.'').
---------------------------------------------------------------------------

    4. As more nuclear \9\ and coal plants \10\--with their high 
capacity factors and onsite fuel--announce early retirements, the 
dispatchable resources that remain are predominantly natural gas 
generators. Backstopping weather-dependent resources with gas 
generators, largely dependent on just-in-time delivery of gas, raises 
its own set of reliability concerns, particularly in areas--like New 
England--with inadequate pipeline infrastructure. On top of this, the 
Commission has delayed the processing of pipeline certificates and cast 
a chill over the pipeline industry with its ``draft policy statements'' 
\11\ and orders throwing the finality of fully litigated certificates 
into doubt.\12\ Under pressure to reduce emissions at all costs, 
pipelines have moved to electrify compressor stations, furthering an 
unhealthy co-dependency between the gas and electric systems. And the 
efforts of politically motivated financial institutions to cut fossil 
fuel producers' access to capital has added to the current supply 
crunch.\13\ Yet, we are led to believe that extreme weather is supposed 
to be the culprit for the nation's looming reliability woes. Not so.
---------------------------------------------------------------------------

    \9\ U.S. Energy Information Administration, U.S. nuclear 
electricity generation continues to decline as more reactors retire 
(Apr. 8, 2022), https://www.eia.gov/todayinenergy/detail.php?id=51978.
    \10\ Ethan Howland, Coal plant owners seek to shut 3.2 GW in PJM 
in face of economic, regulatory and market pressures, Utility Dive 
(Mar. 22, 2022), https://www.utilitydive.com/news/coal-plant-owners-seek-to-retire-power-in-pjm/620781/.
    \11\ See Certification of New Interstate Nat. Gas Facilities, 
178 FERC ] 61,107 (2022) (Danly and Christie, Comm'rs, dissenting); 
Consideration of Greenhouse Gas Emissions in Nat. Gas Infrastructure 
Project Revs., 178 FERC ] 61,108 (2022) (Danly and Christie, 
Comm'rs, dissenting); see also Certification of New Interstate Nat. 
Gas Facilities, 178 FERC ] 61,197, at P 2 (2022) (converting the two 
policy statements to ``draft policy statements''). It is worth 
noting that PJM and MISO filed comments on the draft policy 
statements. PJM and MISO May 25, 2022 Limited Reply Comments, Docket 
Nos. PL18-1-001 and PL21-3-001, at 4 (``[A]ny future Commission 
pipeline policy should consider the importance of ensuring that 
needed pipeline infrastructure can be timely sited, and ensure that 
the need for infrastructure to meet electric system reliability is 
affirmatively considered and not lost in the debate over the scope 
of environmental reviews to be undertaken by the Commission.'').
    \12\ See, e.g., Algonquin Gas Transmission, LLC, 174 FERC ] 
61,126 (2021) (Danly and Christie, Comm'rs, dissenting).
    \13\ Matt Egan, Energy crisis will set off social unrest, 
private-equity billionaire warns, CNN Business (Oct. 26, 2021), 
https://edition.cnn.com/2021/10/26/business/gas-prices-energy-crisis-schwarzman/index.html (``Part of the problem, [Blackstone CEO 
Stephen Schwarzman] said, is that it's getting harder and harder for 
fossil fuel companies to borrow money to fund their expensive 
production activities, especially in the United States. And without 
new production, supply won't keep up.'').

---------------------------------------------------------------------------

[[Page 39426]]

    5. The question of whether the weather is getting worse is a red 
herring. The much more relevant question is whether current system 
operations and tariff and market design are adequate to maintain 
reliability. The present high risk of reliability failures proves that 
they are not. That the policies of the Commission and other government 
bodies are undermining reliability is far more obvious than the 
question of whether, and how, the weather is getting worse and what 
specific effects that worsening weather might have on the stability of 
the electric system. That question of the weather's effect on 
reliability is a subject that doubtless merits study and planning, but 
misguided government policies are the root cause of the alarming 
reliability issues facing the nation, not the weather.
    For these reasons, I respectfully concur.

-----------------------------------------------------------------------

James P. Danly,
Commissioner.

[FR Doc. 2022-13469 Filed 6-30-22; 8:45 am]
BILLING CODE 6717-01-P


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