25422 Federal Register / Vol. 74, No. 101 / Thursday, May 28, 2009 / Rules and Regulations 

81Regulations Implementing the National 

Environmental Policy Act, Order No. 486, FERC 

Stats. & Regs. ¶ 30,783 (1987). 82 18 CFR 380.4(a)(2)(ii). 83 5 U.S.C. 601–12. 84See 13 CFR 121.201. 

85To be included in the compliance registry, the 

ERO determines whether a specific small entity has 

a material impact on the Bulk-Power System. If 

these small entities should have such an impact 

then their compliance is justifiable as necessary for 

Bulk-Power System reliability. 

86The Commission remands the interpretation of 

the VAR–001–1 Reliability Standard. 

environment.81 The Commission has 

categorically excluded certain actions 

from this requirement as not having a 

significant effect on the human 

environment. Included in the exclusion 

are rules that are clarifying, corrective, 

or procedural or that do not 

substantially change the effect of the 

regulations being amended.82 The 

actions proposed herein fall within this 

categorical exclusion in the 

Commission’s regulations. 

V. Regulatory Flexibility Act Analysis 

67. The Regulatory Flexibility Act of 

1980 (RFA) 83 generally requires a 

description and analysis of final 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 that minimize any 

significant economic impact on a 

substantial number of small entities. 

The Small Business Administration’s 

Office of Size Standards develops the 

numerical definition of a small 

business.84 For electric utilities, a firm 

is small if, including its affiliates, it is 

primarily engaged in the transmission, 

generation and/or distribution of 

electric energy for sale and its total 

electric output for the preceding twelve 

months did not exceed four million 

megawatt hours. The RFA is not 

implicated by this Final Rule because 

the interpretations discussed herein will 

not have a significant economic impact 

on a substantial number of small 

entities. 

68. In Order No. 693, the Commission 

adopted policies to minimize the 

burden on small entities, including 

approving the ERO compliance registry 

process to identify those entities 

responsible for complying with 

mandatory and enforceable Reliability 

Standards. The ERO registers only those 

distribution providers or load serving 

entities that have a peak load of 25 MW 

or greater and are directly connected to 

the bulk electric system or are 

designated as a responsible entity as 

part of a required under-frequency load 

shedding program or a required undervoltage load shedding program. 

Similarly, for generators, the ERO 

registers only individual units of 20 

MVA or greater that are directly 

connected to the bulk electric system, 

generating plants with an aggregate 

rating of 75 MVA or greater, any 

blackstart unit material to a restoration 

plan, or any generator that is material to 

the reliability of the Bulk-Power System. 

Further, the ERO will not register an 

entity that meets the above criteria if it 

has transferred responsibility for 

compliance with mandatory Reliability 

Standards to a joint action agency or 

other organization. The Commission 

estimated that the Reliability Standards 

approved in Order No. 693 would apply 

to approximately 682 small entities 

(excluding entities in Alaska and 

Hawaii), but also pointed out that the 

ERO’s Compliance Registry Criteria 

allow for a joint action agency, 

generation and transmission (G&T) 

cooperative or similar organization to 

accept compliance responsibility on 

behalf of its members. Once these 

organizations register with the ERO, the 

number of small entities registered with 

the ERO will diminish and, thus, 

significantly reduce the impact on small 

entities.85

69. Finally, as noted above, this Final 

Rule addresses an interpretation of the 

BAL–003–0 Reliability Standard, which 

was already approved in Order No. 693, 

and, therefore, does not create an 

additional regulatory impact on small 

entities.86

VI. Document Availability 

70. 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) and in the Commission’s 

Public Reference Room during normal 

business hours (8:30 a.m. to 5 p.m. 

Eastern time) at 888 First Street, NE., 

Room 2A, Washington, DC 20426. 

71. 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. 

72. User assistance is available for 

eLibrary and the Commission’s Web site 

during normal business hours from 

FERC Online Support at (202) 502–6652 

(toll free at 1–866–208–3676) or e-mail 

at ferconlinesupport@ferc.gov, or the 

Public Reference Room at (202) 502– 

8371, TTY (202) 502–8659. E-mail the 

Public Reference Room at 

public.referenceroom@ferc.gov. 

VII. Effective Date and Congressional 

Notification 

73. These regulations are effective 

June 29, 2009. The Commission has 

determined, with the concurrence of the 

Administrator of the Office of 

Information and Regulatory Affairs of 

OMB, that this rule is not a ‘‘major rule’’ 

as defined in section 351 of the Small 

Business Regulatory Enforcement 

Fairness Act of 1996. 

List of Subjects in 18 CFR Part 40 

Electric power, Electric utilities, 

Reporting and recordkeeping 

requirements. 

By the Commission. 

Nathaniel J. Davis, Sr., 

Deputy Secretary. 

[FR Doc. E9–12348 Filed 5–27–09; 8:45 am] 

BILLING CODE 6717–01–P 

DEPARTMENT OF ENERGY 

Federal Energy Regulatory 

Commission 

18 CFR Part 40 

[Docket No. RM08–12–000; Order No.723] 

Western Electricity Coordinating 

Council Regional Reliability Standard 

Regarding Automatic Time Error 

Correction 

Issued May 21, 2009. 

AGENCY: Federal Energy Regulatory 

Commission, DOE. 

ACTION: Final rule. 

SUMMARY: Pursuant to section 215 of the 

Federal Power Act (FPA), the Federal 

Energy Regulatory Commission 

(Commission) approves regional 

Reliability Standard BAL–004–WECC– 

01 (Automatic Time Error Correction), 

as submitted by the North American 

Electric Reliability Corporation. As a 

separate action, pursuant to section 

215(d)(5) of the FPA, the Commission 

directs the Western Electricity 

Coordinating Council to develop several 

modifications to the regional Reliability 

Standard. The regional Reliability 

Standard requires balancing authorities 

within the Western Interconnection to 

maintain interconnection frequency 

within a predefined frequency profile 

and ensure that time error corrections 

are effectively conducted in a manner 

that does not adversely affect the 

reliability of the Interconnection. 

Federal Register / Vol. 74, No. 101 / Thursday, May 28, 2009 / Rules and Regulations 25423 

1 16 U.S.C. 824o (2006). 

2The proposed regional Reliability Standard will 

be in effect within the Western Interconnectionwide WECC Regional Entity. In this proceeding, the 

Commission proposes to take action to make 

mandatory the regional Reliability Standard as it 

applies within the U.S. portion of the Western 

Interconnection. 

3Mismatches between generation and interchange 

and load and losses result in the Balancing Area 

operating at frequencies other than 60 Hertz, which 

causes both time error and inadvertent interchange. 

4See FPA 215(e)(3), 16 U.S.C. 824o(e)(3). 

5Rules Concerning Certification of the Electric 

Reliability Organization; and Procedures for the 

Establishment, Approval, and Enforcement of 

Electric Reliability Standards, Order No. 672, FERC 

Stats. & Regs. ¶ 31,204 (2006), order on reh’g, Order 

No. 672–A, FERC Stats. & Regs. ¶ 31,212 (2006). 

6See North American Electric Reliability Corp., 

116 FERC ¶ 61,062, order on reh’g and compliance, 

117 FERC ¶ 61,126 (2006). 

7 16 U.S.C. 824o(e)(4). 

DATES: Effective Date: This rule will 

become effective June 29, 2009. 

FOR FURTHER INFORMATION CONTACT: 

Jonathan First (Legal Information), 

Office of the General Counsel, Federal 

Energy Regulatory Commission, 888 

First Street, NE., Washington, DC 

20426. (202) 502–8529. 

Katherine Waldbauer (Legal 

Information), Office of the General 

Counsel, Federal Energy Regulatory 

Commission, 888 First Street, NE., 

Washington, DC 20426. (202) 502– 

8232. katherine.waldbauer@ferc.gov. 

Nick Henery (Technical Information), 

Office of Electric Reliability, Federal 

Energy Regulatory Commission, 888 

First Street, NE., Washington, DC 

20426, (202) 502–8636. 

nick.henery@ferc.gov. 

SUPPLEMENTARY INFORMATION: 

Order No. 723 

Table of Contents 

Paragraph 

Nos. 

I. Background ............................................................................................................................................................................................ 4. 

A. Mandatory Reliability Standards ................................................................................................................................................. 4. 

B. Procedural Background ................................................................................................................................................................ 11. 

C. Reliability Standard BAL–004–WECC–01 ................................................................................................................................... 14. 

II. Discussion ............................................................................................................................................................................................ 22. 

A. Requirement R1.2 ......................................................................................................................................................................... 27. 

B. Explanation of 24-Hour Exemption Period of Requirement R2 ................................................................................................. 31. 

C. New Glossary Definitions ............................................................................................................................................................. 35. 

D. Consistency With NERC Reliability Standards ........................................................................................................................... 41. 

E. Violation Risk Factors .................................................................................................................................................................. 49. 

F. Violation Severity Levels ............................................................................................................................................................. 52. 

III. Information Collection Statement ...................................................................................................................................................... 55. 

IV. Environmental Analysis ..................................................................................................................................................................... 60. 

V. Regulatory Flexibility Act ................................................................................................................................................................... 61. 

VI. Document Availability ....................................................................................................................................................................... 64. 

VII. Effective Date and Congressional Notification ................................................................................................................................ 67. 

Before Commissioners: Jon 

Wellinghoff, Chairman; Suedeen G. 

Kelly, Marc Spitzer, and Philip D. 

Moeller. 

Order No. 723 

Final Rule 

Issued May 21, 2009 

1. Pursuant to section 215 of the 

Federal Power Act (FPA),1 the 

Commission approves regional 

Reliability Standard BAL–004–WECC– 

01 (Automatic Time Error Correction), 

submitted to the Commission for 

approval by the North American Electric 

Reliability Corporation (NERC). As a 

separate action, pursuant to section 

215(d)(5) of the FPA, the Commission 

directs the Western Electricity 

Coordinating Council (WECC) to 

develop several modifications to the 

regional Reliability Standard. The 

regional Reliability Standard requires 

balancing authorities within the WECC 

region to implement an automatic time 

error correction procedure for the 

purpose of maintaining Interconnection 

frequency within a predefined 

frequency profile and ensuring that time 

error corrections are effectively 

conducted in a manner that does not 

adversely affect reliability.2

2. The Reliability Standard benefits 

the reliable operation of the Bulk-Power 

System by creating an operating 

environment that encourages system 

operators to balance their generation 

and interchange with their load and 

losses, thereby minimizing the 

difference between the net actual and 

net scheduled interchanges. This 

process will result in reducing the 

number of manual time error corrections 

required by the Western Interconnection 

Time Monitor, and minimize 

accumulated inadvertent interchange 

energy between Western 

Interconnection balancing authorities.3

The Commission also accepts three 

related definitions that are included in 

the regional Reliability Standard. The 

Commission further approves the 

violation risk factors for the regional 

Reliability Standard, and directs the 

Electric Reliability Organization (ERO) 

and WECC to submit revised violation 

risk factors in a filing within 60 days of 

the effective date of this Final Rule. The 

Commission also directs the ERO and 

WECC to submit violation severity 

levels for each Requirement and subRequirement that has been assigned a 

violation risk factor within 120 days of 

the effective date of this Final Rule. 

3. As discussed below, the 

Commission finds that the regional 

Reliability Standard proposed by WECC 

satisfies the statutory criteria, and is 

more stringent than the applicable 

continent-wide NERC Reliability 

Standard. 

I. Background 

A. Mandatory Reliability Standards 

4. Section 215 of the FPA requires a 

Commission-certified ERO to develop 

mandatory and enforceable Reliability 

Standards, which are subject to 

Commission review and approval. Once 

approved, the Reliability Standards may 

be enforced by the ERO, subject to 

Commission oversight, or by the 

Commission independently.4

5. In February 2006, the Commission 

issued Order No. 672,5 implementing 

section 215 of the FPA. Pursuant to 

Order No. 672, the Commission certified 

one organization, NERC, as the ERO.6

Reliability Standards that the ERO 

proposes to the Commission may 

include Reliability Standards that are 

proposed to the ERO by a Regional 

Entity.7 When the ERO reviews a 

regional Reliability Standard that would 

be applicable on an Interconnectionwide basis and that has been proposed 

by a Regional Entity organized on an 

Interconnection-wide basis, the ERO 

25424 Federal Register / Vol. 74, No. 101 / Thursday, May 28, 2009 / Rules and Regulations 

8 16 U.S.C. 824o(d)(3); 18 CFR 39.5(b). 

9 16 U.S.C. 824o(d)(2). 

10 Id. 

11 Id. 

12Order No. 672, FERC Stats. & Regs. ¶ 31,204 at 

P 290. 

13 Id. P 291. 

14 Id. 

15 Mandatory Reliability Standards for the BulkPower System, Order No. 693, FERC Stats. & Regs. 

¶ 31,242, order on reh’g, Order No. 693–A, 120 

FERC ¶ 61,053 (2007). 

16 16 U.S.C. 824o(d)(5). Section 215(d)(5) 

provides, ‘‘The Commission * * * may order the 

Electric Reliability Organization to submit to the 

Commission a proposed reliability standard or a 

modification to a reliability standard that addresses 

a specific matter if the Commission considers such 

a new or modified reliability standard appropriate 

to carry out this section.’’ 

17Order No. 693, FERC Stats. & Regs. ¶ 31,242 at 

P 377, 382. The Commission also directed NERC to 

develop a modification to BAL–004–0 to include 

Levels of Non-Compliance and additional Measures 

for Requirement R3. 

18See North American Electric Reliability Corp., 

119 FERC ¶ 61,060, order on reh’g, 120 FERC 

¶ 61,260 (2007) (Delegation Agreement Order). 

19 Id. P 469–470. 

20North American Electric Reliability Corp., 119 

FERC ¶ 61,260 (2007). 

21 16 U.S.C. 824o(d)(1) (2006). 

22The NERC glossary defines ‘‘interchange’’ as 

the energy transfers that cross balancing authority 

boundaries, and defines ‘‘inadvertent interchange’’ 

as the difference between the balancing authority’s 

net actual interchange and its net scheduled 

interchange. Within a synchronous Interconnection, 

during real-time operations, a balancing authority 

may engage in ‘‘inadvertent interchange’’ if it 

experiences an operational problem that prevents 

its net actual interchange of energy from matching 

its net scheduled interchange with other balancing 

authorities within the Interconnection. This 

discrepancy will indicate what is referred to as a 

‘‘time error’’—i.e., because the Interconnection will 

operate at a frequency (number of cycles per 

second) that is different from the Interconnection’s 

scheduled frequency of 60 Hz (60 cycles per 

second). Time error also serves as a means to 

measure of how much and which balancing 

authority within the Interconnection is out of 

balance. To correct the time error using the 

Automatic Time Error Correction (ATEC) method, 

it is necessary for the balancing authority that was 

out of balance to adjust the Interconnection’s 

frequency so that it equalizes its prior inadvertent 

energy exchange with the Interconnection. 

23Western Electricity Coordinating Council 

Regional Reliability Standard Regarding Automatic 

Time Error Correction, Notice of Proposed 

Rulemaking, 73 FR 71977 (Nov. 26, 2008), FERC 

Stats. & Regs. ¶ 32,638 (2008). 

must rebuttably presume that the 

regional Reliability Standard is just, 

reasonable, not unduly discriminatory 

or preferential, and in the public 

interest.8

6. In reviewing the ERO’s submission, 

the Commission will give due weight to 

the ERO’s technical expertise, except 

concerning the effect of a proposed 

Reliability Standard on competition.9

The Commission will also give due 

weight to the technical expertise of a 

Regional Entity organized on an 

Interconnection-wide basis with respect 

to a proposed Reliability Standard to be 

applicable within that 

Interconnection.10

7. The Commission may approve a 

proposed Reliability Standard if the 

Commission finds it is just, reasonable, 

not unduly discriminatory or 

preferential, and in the public interest.11

In addition, the Commission explained 

in Order No. 672 that ‘‘uniformity of 

Reliability Standards should be the goal 

and the practice, the rule rather than the 

exception.’’ 12 Yet, the Commission 

recognized that ‘‘the goal of greater 

uniformity does not, however, mean 

that regional differences cannot 

exist.’’ 13 The Commission then 

provided the following guidance: 

As a general matter, we will accept the 

following two types of regional differences, 

provided they are otherwise just, reasonable, 

not unduly discriminatory or preferential, 

and in the public interest, as required by the 

statute: (1) A regional difference that is more 

stringent than the continent-wide Reliability 

Standard, including a regional difference that 

addresses matters that the continent-wide 

Reliability Standard does not; and (2) a 

regional Reliability Standard that is 

necessitated by a physical difference in the 

Bulk-Power System.14

8. On March 16, 2007, the 

Commission issued Order No. 693, 

approving 83 of the 107 Reliability 

Standards originally proposed by 

NERC.15 In addition, pursuant to section 

215(d)(5) of the FPA, the Commission 

directed NERC to develop modifications 

to 56 of the 83 approved Reliability 

Standards.16 Relevant to the immediate 

proceeding, the Commission approved 

continent-wide Reliability Standard 

BAL–004–0 (Time Error Correction), but 

noted that WECC’s regional approach 

appears to serve as a more effective 

means of accomplishing time error 

corrections.17

9. On April 19, 2007, the Commission 

approved delegation agreements 

between NERC and each of the eight 

Regional Entities, including WECC.18

Pursuant to such agreements, the ERO 

delegated responsibility to the Regional 

Entities to enforce the mandatory, 

Commission-approved Reliability 

Standards. In addition, the Commission 

approved, as part of each delegation 

agreement, a Regional Entity process for 

developing regional Reliability 

Standards. In the Delegation Agreement 

Order, the Commission accepted WECC 

as a Regional Entity organized on an 

Interconnection-wide basis and 

accepted WECC’s Standards 

Development Manual, which sets forth 

the process for development of WECC’s 

Reliability Standards.19

10. In a June 2007 order, the 

Commission approved eight regional 

Reliability Standards that apply in the 

WECC region.20

B. Procedural Background 

11. On July 29, 2008, NERC submitted 

for Commission approval, in accordance 

with section 215(d)(1) of the FPA,21

regional Reliability Standard BAL–004– 

WECC–01, which would apply to 

balancing authorities within the 

Western Interconnection. NERC stated 

that the primary purpose of the regional 

Reliability Standard is to reduce the 

number of time error corrections 

imposed on the Western 

Interconnection by requiring balancing 

authorities that operate synchronously 

in the Western Interconnection to 

automatically correct for their 

contribution to time error. According to 

NERC, BAL–004–WECC–01 provides 

the added benefit of a superior approach 

over the current NERC manual time 

error correction (BAL–004–0) for 

assigning costs and providing for the 

equitable payback of inadvertent 

interchange.22

12. On November 20, 2008, the 

Commission issued a Notice of 

Proposed Rulemaking (NOPR) that 

proposed to approve BAL–004–WECC– 

01.23 In response, four interested 

persons filed comments: NERC, WECC, 

Consumers Energy Company 

(Consumers) and Xcel Energy Services 

Inc (Xcel). 

13. In its July 2008 filing, NERC stated 

that Automatic Time Error Correction or 

ATEC has been a regional reliability 

practice in WECC, effectively reducing 

manual time error corrections, reducing 

the number of hours of manual time 

error correction for the Western 

Interconnection, and reducing the 

accumulated inadvertent interchange in 

the Western Interconnection since 2003. 

NERC asserted that the proposed WECC 

regional Reliability Standard is more 

stringent or covers matters not 

addressed by NERC’s continent-wide 

Reliability Standards, BAL–004–0 and 

BAL–006–1 (Inadvertent Interchange). 

C. Reliability Standard BAL–004– 

WECC–01 

14. Regional Reliability Standard 

BAL–004–WECC–01 contains four 

requirements, summarized as follows: 

15. Requirement R1. Requires that all 

balancing authorities must continuously 

participate in Automatic Time Error 

Correction through their automatic 

generation control systems. The subrequirement (R1.1) limits the payback 

amount to minimize any operating 

metric violations, while R1.2 addresses 

actions for cases when invalidated 

implementation of the ATEC 

Federal Register / Vol. 74, No. 101 / Thursday, May 28, 2009 / Rules and Regulations 25425 

24Order No. 672, FERC Stats. & Regs. ¶ 31,204 at 

P 323–337. 

25The balancing authority causing the frequency 

error is said to have created ‘‘primary time error’’ 

and caused ‘‘primary inadvertent interchange.’’ The 

other balancing authorities in the Interconnection 

responding to correct system frequency are said to 

have created ‘‘secondary time error’’ and caused 

‘‘secondary inadvertent interchange.’’ 

26ACE is the instantaneous difference between a 

Balancing Authority’s net actual and scheduled 

interchange, taking into account the effects of 

Frequency Bias and correction for meter error 

(NERC glossary of terms used in reliability 

standards, http://www.nerc.com/docs/standards/rs/ 

Glossary_2009April20.pdf, at 1). More specifically: 

ACE = (NIA ¥ NIS)¥10bi(FA ¥ FS)¥T0b + IME

(Requirement R1 of Commission Approved 

Standard BAL–001–0.1a, see http://www.nerc.com/ 

docs/standards/sar/ 

Interpretation_WECC_ATEC_BAL-001and003_BOTApproved_23Oct07.pdf). 

27NERC filing at 10. 

methodology occurs and requires 

adjustments. 

16. Requirement R2. Requires a 

balancing authority that operates in any 

automatic generation control operating 

mode other than ATEC to notify all 

other balancing authorities of its 

operating mode. This requirement is 

necessary to ensure the reliable 

operations of the Western 

Interconnection by creating an operating 

environment that encourages the 

Balancing Authorities to minimize the 

difference between the net actual and 

net scheduled interchanges. To avoid 

large accumulation of inadvertent 

interchanges, Requirement R2 limits a 

balancing authority’s use of operating 

modes other than ATEC to a maximum 

of 24 hours per calendar quarter. 

17. Requirement R3. Requires 

balancing authorities to have the 

capability to switch between different 

automatic generation control operating 

modes as necessary to operate reliably 

during various system conditions. 

18. Requirement R4. Requires each 

balancing authority to calculate and 

record its hourly ‘‘Primary Inadvertent 

Interchange’’ when hourly checkout is 

complete. 

19. The WECC regional Reliability 

Standard also introduces the following 

three new definitions: 

Automatic Time Error Correction: A 

frequency control automatic action that 

a Balancing Authority uses to offset its 

frequency contribution to support the 

Interconnection’s scheduled frequency. 

Primary Inadvertent Interchange: The 

component of area (n) inadvertent 

interchange caused by the regulating 

deficiencies of area (n) itself. 

Secondary Inadvertent Interchange: 

The component of area (n) inadvertent 

interchange caused by the regulating 

deficiencies of area (i). 

20. In its July 2008 filing, NERC 

asserted that the ATEC procedure 

provided in the proposed regional 

Reliability Standard has been effective 

in mitigating three problems relating to 

correction of time errors in the Western 

Interconnection. First, the ATEC 

procedure has reduced the need for the 

WECC Time Monitor to conduct manual 

time error corrections from 216 manual 

time error corrections in 2003 to 106 

manual time error corrections in 2007. 

Second, since time error is directly 

related to inadvertent interchange, the 

ATEC procedure reduces both time error 

and accumulated inadvertent 

interchange. Third, according to NERC, 

the ATEC procedure better identifies the 

balancing authorities responsible for 

inadvertent interchange and provides a 

more equitable and immediate payback 

of the inadvertent interchange to the 

balancing authorities that should 

receive it (i.e., the balancing authorities 

that did not cause the inadvertent 

interchange but supported the 

interconnection’s scheduled frequency) 

than the current NERC time error 

correction process in BAL–004–0. 

21. NERC also stated that the 

proposed regional Reliability Standard 

satisfies the factors provided in Order 

No. 672 that the Commission considers 

when determining whether a proposed 

Reliability Standard is just, reasonable, 

not unduly discriminatory or 

preferential and in the public interest.24

According to NERC, BAL–004–WECC– 

01 is clear and unambiguous regarding 

what is required and who is required to 

comply (balancing authorities). NERC 

also stated that the proposed regional 

Reliability Standard has clear and 

objective measures for compliance and 

achieves a reliability goal (namely, 

creating an operating environment that 

encourages system operators to 

minimize the difference between the net 

actual and net scheduled interchanges, 

and to better control frequency) 

effectively and efficiently. 

II. Discussion 

22. Pursuant to section 215(d) of the 

FPA, the Commission approves regional 

Reliability Standard BAL–004–WECC– 

01 as mandatory and enforceable. 

23. Pursuant to the continent-wide 

NERC Reliability Standard BAL–004–1, 

when accumulated time error increases 

to a predetermined level, the 

Interconnection’s Time Monitor 

instructs all balancing authorities in the 

Interconnection to manually change the 

scheduled Interconnection’s frequency 

until the Interconnection’s accumulated 

time error has been reduced to a set 

level. However, the requirements of 

BAL–004–1 do not require each 

balancing authority to determine what 

portion of the Interconnection’s time 

error that it alone caused. 

24. Under the WECC ATEC 

methodology, each balancing authority 

in the Western Interconnection is 

required to calculate its ‘‘primary 

inadvertent interchange’’ 25 and enter its 

‘‘primary inadvertent interchange’’ into 

its Area Control Error (ACE) 26 equation. 

When all balancing authorities input 

their portion of ‘‘primary inadvertent 

interchange’’ into their ACE equation, 

they continuously correct for their own 

‘‘primary time error’’ and, in turn, 

reduce the Western Interconnection’s 

total time error. 

25. This process differs from the 

methodology used in NERC’s BAL–004– 

1, in that ATEC is designed to place the 

responsibility to correct primary time 

error on the balancing authority that 

causes it. Further, the regional 

Reliability Standard is more stringent 

and covers matters not addressed by the 

related continent-wide NERC Reliability 

Standards BAL–004–0 and BAL–006–1. 

The regional Reliability Standard 

provides for automatic correction of 

time error, using a more refined primary 

inadvertent interchange term than that 

included in the continent-wide NERC 

Reliability Standards for manual 

correction of time error.27 Accordingly, 

the Commission finds that the regional 

Reliability Standard proposed by WECC 

is more stringent than the continentwide NERC Reliability Standard, 

because it provides for continuous 

capture of inadvertent interchange, and 

thereby (1) contributes to better 

operation of balancing authorities by 

operators, and (2) ensures that 

discrepancies between a balancing 

area’s net scheduled interchange and its 

net actual interchange are adjusted more 

quickly and accurately. Pursuant to 

section 215(d) of the FPA, the 

Commission approves BAL–004– 

WECC–01 as just, reasonable, not 

unduly discriminatory or preferential 

and in the public interest. 

26. As a separate matter, pursuant to 

section 215(d)(5) of the FPA, the 

Commission directs WECC to develop, 

pursuant to its regional Reliability 

Standards Development Procedure, 

modifications to BAL–004–WECC–01 to 

address the Commission’s specific 

concerns, as discussed below. Further, 

the Commission approves some of the 

proposed violation risk factors and 

violation severity levels, and directs the 

ERO to submit a filing within 60 days 

of the effective date of this Final Rule 

revising other specified violation risk 

factors and another filing within 120 

days of the effective date of this Final 

Rule providing violation severity levels 

25426 Federal Register / Vol. 74, No. 101 / Thursday, May 28, 2009 / Rules and Regulations 

28NOPR at P 36. 

29NOPR at P 37. 

30NOPR at P 26. While the Commission 

discussed the proposed definitions in several places 

in the NOPR, in one instance the Commission 

stated that it proposed to ‘‘accept three related 

definitions for inclusion in the NERC Reliability 

Standards Glossary (NERC glossary).’’ Id. P 2. In 

other instances, the Commission simply stated that 

it proposed to approve the definitions. Id. P 26, 34. 

31Consumers Comments at 4, citing NERC Rules 

of Procedure, section 300 and Appendix 3A (NERC 

Reliability Standards Development Procedure) at 8. 

for each Requirement and subRequirement that has been assigned a 

violation risk factor. 

A. Requirement R1.2 

27. Requirement R1.2 of BAL–004– 

WECC–01 provides in part, ‘‘[l]arge 

accumulations of primary inadvertent 

[energy] point to an invalid 

implementation of ATEC, loose control, 

metering or accounting errors. A 

[balancing authority] in such a situation 

should identify the source of the error(s) 

and make the corrections.’’ In the 

NOPR, the Commission noted that the 

phrases ‘‘large accumulation’’ and ‘‘in 

such a situation’’ are not defined and, 

while likely obvious in many 

circumstances, leaves to individual 

interpretation when a ‘‘large’’ amount of 

primary inadvertent has accumulated.28

The Commission proposed to direct 

WECC to develop revisions to the 

provision so that a balancing authority 

will know with specificity the 

circumstances that trigger the actions 

required by Requirement R1.2. 

1. Comments 

28. WECC acknowledges the 

Commission’s concern that the 

undefined phrases ‘‘large accumulation’’ 

and ‘‘in such a situation’’ in 

Requirement R1.2 could lead to 

uncertainty among Balancing 

Authorities as to when they are required 

to take action. WECC comments that, 

while these terms have a general 

industry understanding within the 

Western Interconnection, clarifying 

these terms would remove the potential 

for controversy over compliance 

requirements. WECC suggests either 

defining the terms within the regional 

Reliability Standard or modifying the 

standard language to better identify 

specific parameters that would trigger 

actions required under this standard. 

29. NERC agrees that further clarity of 

the identified phrases in Requirement 

R1.2 is appropriate and believes WECC’s 

proposal in its comments is responsive. 

2. Commission Determination 

30. As we explained in the NOPR, the 

Commission is concerned that the 

phrases ‘‘large accumulation’’ and ‘‘in 

such a situation’’ as used in 

Requirement R1.2 leave to individual 

interpretation when a ‘‘large’’ amount of 

primary inadvertent has accumulated. 

The ERO and WECC agree that the 

provision could benefit from further 

clarity. Accordingly, the Commission 

adopts its NOPR proposal and directs 

WECC to develop revisions to the 

provision so that a balancing authority 

will know with specificity the 

circumstances that trigger the actions 

required by Requirement R1.2. 

B. Explanation of 24-Hour Exemption 

Period of Requirement R2 

31. Requirement R2 of BAL–004– 

WECC–01 provides that ‘‘[e]ach 

[balancing authority] while 

synchronously connected to the 

Western Interconnection will be 

allowed to have ATEC out of service for 

a maximum of 24 hours per calendar 

quarter, for reasons including 

maintenance and testing.’’ In the NOPR, 

the Commission proposed to direct 

WECC to develop a modification that 

clarifies whether the ‘‘maximum of 24 

hours per calendar quarter’’ refers to a 

single occurrence of up to 24 hours in 

the calendar quarter, or whether several 

occurrences are permitted as long as 

they add up to 24 hours or less within 

a calendar quarter.29

1. Comments 

32. WECC comments that it intended 

the 24-hour per calendar quarter limit to 

permit an accumulated total of up to 24 

hours, whether resulting from one 

extended occurrence or multiple 

occurrences. Likewise, NERC 

understands that WECC intended the 

provision to permit an accumulated 

total of up to 24 hours from one or more 

occurrences. 

33. WECC and NERC agree the 

proposed NOPR modifications will 

leave the regional Reliability Standard 

more definite and can be addressed 

through WECC’s stakeholder process. 

2. Commission Determination 

34. Consistent with the NOPR, 

pursuant to section 215(d)(5) of the 

FPA, the Commission directs WECC to 

develop a modification to the regional 

Reliability Standard consistent with 

WECC’s and NERC’s explanation that 

the limit set forth in Requirement 2 of 

‘‘24 hours per calendar quarter’’ is an 

accumulated total for the period, 

resulting from either a singular event or 

a cumulative time limit from a number 

of events. 

C. New Glossary Definitions 

35. As mentioned above, the WECC 

regional Reliability Standard includes 

three new definitions: Automatic Time 

Error Correction, Primary Inadvertent 

Interchange and Secondary Inadvertent 

Interchange. In the NOPR, the 

Commission proposed to approve the 

three new terms.30

1. Comments 

36. Consumers expresses concern 

regarding the incorporation of three 

newly defined terms (Automatic Time 

Error Correction, Primary Inadvertent 

Interchange and Secondary Inadvertent 

Interchange) into the NERC glossary. 

Consumers states that it is appropriate 

for the three new definitions to apply to 

WECC regional Reliability Standards. 

However, according to Consumers, the 

definitions have not been vetted through 

NERC’s full development process for 

their inclusion in the NERC glossary, 

applicable to NERC Reliability 

Standards that apply on a continentwide basis. Specifically, Consumers 

points out that NERC’s Rules of 

Procedure provide that all definitions 

must be approved in accordance with 

the standards process.31 Consumers 

recommends that the Commission either 

clearly designate the proposed 

definitions as being applicable only to 

WECC regional Reliability Standards or 

direct NERC to submit the proposed 

definitions for stakeholder review as 

part of the NERC Reliability Standards 

development process. 

2. Commission Determination 

37. The Commission agrees with 

Consumers that the three new 

definitions have not been vetted through 

the ERO’s full development process for 

their inclusion in the NERC glossary; 

and that the three new definitions 

approved in this Final Rule apply only 

to WECC regional Reliability Standards. 

NERC should designate them 

accordingly. Therefore, to ensure that all 

approved definitions, NERC and 

regional, are maintained in a single 

location, NERC should add or append 

the three new regional definitions to the 

NERC Glossary of Terms in such a way 

as to designate that they apply only in 

the Western Interconnection. 

38. The Commission, however, has a 

general concern regarding the 

development of definitions that apply 

only to regional Reliability Standards. 

The Commission understands that, prior 

to NERC’s development of the ‘‘Version 

0’’ Reliability Standards, there were 

multiple regional standards and 

protocols, with each region having its 

own definitions of terms. In some 

instances, the same or similar terms 

were defined differently within different 

Federal Register / Vol. 74, No. 101 / Thursday, May 28, 2009 / Rules and Regulations 25427 

32Order No. 672, FERC Stats. & Regs. ¶ 31,204 at 

P 290 (‘‘The Commission believes that uniformity 

of Reliability Standards should be the goal and the 

practice, the rule rather than the exception. Greater 

uniformity will encourage best practices, thereby 

enhancing reliability and benefiting consumers and 

the economy’’). 

33 Modification of Interchange and Transmission 

Loading Relief Reliability Standards; and electric 

Reliability Organization Interpretation of specific 

Requirements of Four Reliability Standards, Order 

No. 713, 73 FR 43613, 124 FERC ¶ 61,071 (July 21, 

2008). 

34The Control Performance Standard (CPS) is 

defined in the NERC Glossary as ‘‘[t]he reliability 

standard that sets the limits of a Balancing 

Authority’s Area Control Error over a specified time 

period.’’ 

35Order No. 713, 124 FERC ¶ 61,071 at P 17. 

36R4.2 provides that ‘‘[t]he default Disturbance 

Recovery Period is 15 minutes after the start of a 

Reportable Disturbance,’’ but further states that 

‘‘[t]his period may be adjusted to better suit the 

needs of an Interconnection based on analysis 

approved by the NERC Operating Committee.’’ 

regions. The Version 0 process included 

developing the NERC glossary, which 

eliminated many inconsistencies in 

terminology across regions and created 

a single source for defining terms used 

in Reliability Standards. 

39. We are concerned about a 

potential re-proliferation of regional 

terminology, and consequently, the 

need to prevent possible inconsistent 

use of terminology among regions. 

While NERC has only submitted WECC 

regional Reliability Standards to the 

Commission at this time, other regions 

are in the process of developing regional 

standards. Similar to our policy set forth 

in Order No. 672 that favors the 

development of uniform Reliability 

Standards,32 the Commission believes 

NERC, as a rule, should develop 

definitions that apply uniformly across 

the different interconnections. As a 

general goal, NERC should work to 

minimize the use of regional definitions 

and terminology and, assure that 

proposed regional definitions and 

terminology are as well defined as, do 

not conflict and are not redundant with 

nor redefine, NERC glossary definitions. 

We therefore direct NERC to develop in 

its Rules of Procedure, a methodology 

for organizing and managing regional 

definitions and terminology consistent 

with the principles discussed above. 

40. Further, NERC should be vigilant 

to assure that a regional definition is 

consistent with both NERC definitions 

and the approved terms used in other 

regions. The Commission considers an 

inconsistency or conflict in terms to be 

reasonable grounds to remand a regional 

definition and, if appropriate, the 

regional Reliability Standard that 

employs that definition. 

D. Consistency With NERC Reliability 

Standards 

1. Comments 

41. Xcel comments that, while it 

generally supports the adoption of BAL– 

004–WECC–01, it is concerned that the 

regional Reliability Standard creates a 

potential conflict with two NERC 

Reliability Standards, BAL–001–0a 

(Real Power Balancing Control 

Performance) and BAL–002–0 

(Disturbance Control Performance). Xcel 

requests that the Commission establish 

priority for compliance in the event that 

WECC regional Reliability Standards 

conflict with those of NERC. Xcel’s 

concern involves the difference in the 

ACE equation between the regional and 

the NERC Reliability Standards and the 

compliance elements regarding this 

equation. 

42. Xcel states that BAL–001–0a 

requires that ACE be kept within 

specific parameters, while BAL–004– 

WECC–01 requires a measurement of 

ACE that is outside those parameters to 

be maintained at all times. According to 

Xcel, BAL–004–WECC–01 requires 

ATEC operation at all times except up 

to 24 hours per calendar quarter, but is 

not clear if this period covers times 

when complying with BAL–001–0a 

requires non-compliance with BAL– 

004–WECC–01. Xcel notes that 

Requirement R3 of BAL–004-WECC–01 

requires the ACE used for NERC reports 

to be the same as the ACE used in the 

current AGC operating mode. According 

to Xcel, this requires the use of the 

ACEATEC set forth in BAL–004–WECC– 

01 rather than the BAL–001–0a ACE 

equation in most situations. 

43. Xcel claims that BAL–004–WECC– 

01 may also conflict with BAL–002–0 

Requirement R4.2, which requires that 

the balancing authority restore ACE to 

specified parameters within a defined 

timeframe. Xcel posits that in most 

situations it will be impossible for an 

entity attempting to recover from a 

disturbance to operate at an ACE 

calculated in accordance with the NERC 

standard and ACEATEC simultaneously. 

According to Xcel, the use of the BAL– 

004–WECC–01, Requirement R2 

exception, allowing ATEC to be out of 

service for 24 hours per calendar 

quarter, should be acceptable for 

alleviating this circumstance. Xcel 

contends that, where the 24-hour 

maximum is exceeded for the purpose 

of ACE complying with BAL–002–0, the 

balancing authority should be given 

express authority to deviate from the 

requirements of BAL–004–WECC–01. 

2. Commission Determination 

44. We are not persuaded by Xcel’s 

comments on this matter. We believe 

that our approval, in Order No. 713,33 of 

an ERO interpretation addresses Xcel’s 

concern. Specifically, WECC requested 

that the ERO provide a formal 

interpretation whether the use of 

WECC’s automatic time error correction 

factor that is applied to the net 

interchange portion of the ACE equation 

violates Requirement R1 of NERC 

Reliability Standard BAL–001–0a. In 

response, the ERO interpreted BAL– 

001–0 Requirement R1 as follows: 

• The [WECC automatic time error 

correction or WATEC] procedural 

documents ask Balancing Authorities to 

maintain raw ACE for [control 

performance standard or CPS1 34] 

reporting and to control via WATECadjusted ACE. 

• As long as Balancing Authorities 

use raw (unadjusted for WATEC) ACE 

for CPS reporting purposes, the use of 

WATEC for control is not in violation of 

BAL–001 Requirement 1.35

45. The Commission-approved 

interpretation makes clear that a 

balancing authority is in compliance 

with BAL–001–1a provided that it uses 

the equation identified in R1 for 

reporting CPS1 and achieves the 

performance required by CPS1. The 

balancing authority’s ability to use the 

ACE calculation also to assist in time 

error correction and inadvertent 

interchange payback is not precluded. 

46. Further, the Commission is not 

persuaded by Xcel’s claims that BAL– 

004–WECC–01 may also conflict with 

BAL–002–0, Requirement R4.2, which 

requires that the balancing authority 

restore ACE to specified parameters 

within a defined timeframe. 

Requirements R2 and R3 of Standard 

BAL–004–WECC–0 direct that ATEC 

will be the primary operating mode 

used by all balancing authorities in the 

WECC region. However, balancing 

authorities may modify their ACE 

operating mode to account for various 

operating situations, including the need 

to respond to meeting the Disturbance 

Recovery Criterion within the 

Disturbance Recovery Period in 

Requirement R4.2 of BAL–002–0.36

47. Nor does the Commission agree 

with Xcel’s concern about the 24-hour 

per quarter ATEC operating mode 

exception period. Giving due 

consideration to the Western 

Interconnection’s participants, the 

Commission finds that a 24-hour per 

quarter ATEC operating mode exception 

period encourages the Western 

Interconnection’s balancing authorities 

to maintain a high standard of 

operations to support the reliability of 

the Western Interconnection. 

25428 Federal Register / Vol. 74, No. 101 / Thursday, May 28, 2009 / Rules and Regulations 

37NOPR at P 44–47. 

38 Id. P 46. 

39NOPR at P 49. We note that, in Version Two 

Facilities Design, Connections and Maintenance 

Reliability Standards, Order No. 722, 126 FERC 

¶ 61,255 at P 45 (2009), the ERO proposed to 

develop violation severity levels for Requirements 

but not sub-Requirements. The Commission denied 

the proposal as ‘‘premature’’ and, instead, 

encouraged the ERO to ‘‘develop a new and 

comprehensive approach that would better facilitate 

the assignment of violation severity levels and 

violation risk factors.’’ 

40 5 CFR 1320.11. 

41 44 U.S.C. 3507(d). 42See 16 U.S.C. 824(d). 

48. Consequently, the Commission is 

not persuaded by Xcel’s comments. As 

discussed above, the ERO and the 

Commission have previously addressed 

the issue raised by Xcel, and the 

Commission does not believe that 

remand or further clarification is 

warranted. 

E. Violation Risk Factors 

49. In the NOPR, the Commission 

proposed to direct that the violation risk 

factors assigned to BAL–004–WECC–01, 

Requirements R1, R2, R3, and R4 be 

modified from ‘‘lower’’ to ‘‘medium.’’ 37

The Commission explained that the 

participation in an interconnection’s 

time error correction is critical and can 

directly affect the state of the BulkPower System.38 Further, the 

Commission explained that the 

assignment of a ‘‘medium’’ violation 

risk factor to the Requirements of the 

WECC regional Reliability Standard 

would make it consistent with the 

assignment of ‘‘medium’’ violation risk 

factors to NERC Reliability Standard 

BAL–004–0. 

1. Comments 

50. WECC comments that, while it is 

unlikely that a violation of the regional 

Reliability Standard would lead to BulkPower System instability, it 

acknowledges that ATEC is not 

administrative in nature and could 

affect the electrical status of the BulkPower System making a ‘Medium’ VRF 

more appropriate. Thus, WECC 

comments that ‘‘it does not disagree’’ 

with the Commission’s proposal to 

change the violation risk factors from 

low to medium. NERC also agrees that 

the Commission’s proposal would 

promote consistency. 

2. Commission Determination 

51. We adopt our NOPR proposal and 

direct that the violation risk factors 

assigned to BAL–004–WECC–01, 

Requirements R1, R2, R3, and R4 be 

modified from ‘‘lower’’ to ‘‘medium.’’ 

The ERO and WECC must submit a 

filing within 60 days of the effective 

date of this Final Rule that includes the 

directed modifications. 

F. Violation Severity Levels 

52. The ERO’s July 2008 filing of the 

WECC regional Reliability Standard 

included proposed violation severity 

levels that apply generally to all 

violations of the Requirements of BAL– 

004–WECC–01 and not to any one 

specific Requirement. In the NOPR, the 

Commission proposed to direct the 

submission of new violation severity 

levels for each Requirement and subRequirement that has been assigned a 

violation risk factor.39

1. Comments 

53. WECC comments that the 

Commission’s and NERC’s guidance on 

the development of violation severity 

levels has evolved since the drafting of 

the violation severity levels for BAL– 

004–WECC–1. WECC indicates that it 

will develop violation severity levels for 

each Requirement and sub-Requirement 

of the regional Reliability Standard, and 

requests that the Commission allow 

sufficient time to address the issue 

through the WECC stakeholder process. 

2. Commission Determination 

54. The Commission adopts its NOPR 

proposal and directs the ERO and WECC 

to submit violation severity levels for 

each Requirement and sub-Requirement 

that has been assigned a violation risk 

factor. To allow adequate time for the 

development of the violation severity 

levels, the ERO and WECC must submit 

a filing within 120 days of the effective 

date of this Final Rule that includes the 

directed violation severity levels. 

III. Information Collection Statement 

55. The Office of Management and 

Budget (OMB) regulations require that 

OMB approve certain reporting and 

recordkeeping (collections of 

information) imposed by agency rules.40

The information contained here is also 

subject to review under section 3507(d) 

of the Paperwork Reduction Act of 

1995.41 Upon approval of a collection(s) 

of information, OMB will assign an 

OMB control number and an expiration 

date. Respondents subject to the filing 

requirements of an agency rule will not 

be penalized for failing to respond to 

these collections of information unless 

the collections of information display a 

valid OMB control number. 

56. This Final Rule approves and 

requires modifications of one regional 

Reliability Standard that was submitted 

by NERC as the ERO. Section 215 of the 

FPA authorizes the ERO to submit 

Reliability Standards to provide for the 

reliable operation of the Bulk-Power 

System. Pursuant to the statute, the ERO 

must submit each Reliability Standard 

that it proposes to be made effective to 

the Commission for approval.42

57. The regional Reliability Standard, 

which applies to approximately 35 

balancing authorities in the U.S. portion 

of the Western Interconnection, does not 

require balancing authorities to file 

information with the Commission. It 

does require balancing authorities to 

develop and maintain certain 

information for a specified period of 

time, subject to inspection by WECC. 

However, the Commission does not 

believe that approval of the WECC 

regional Reliability Standard will result 

in an increase in reporting burdens as 

compared to current practices in WECC. 

As NERC indicates, since 2003, WECC 

has used the automatic time error 

correction practice set forth in BAL– 

004–WECC–01. Thus, the Commission 

finds that the requirement to develop 

and maintain information in the 

regional Reliability Standard mirrors 

customary and usual business practice 

in the area in which the Standard will 

apply and, therefore, imposes a minimal 

burden on applicable balancing 

authorities and eliminates any possible 

confusion between current industry 

practice and the standard. The 

Commission also finds that the 

modifications to the current Reliability 

Standard effected by this Final Rule will 

not increase the reporting burden nor 

impose any additional information 

collection requirements. 

58. In response to the NOPR, the 

Commission received no comments 

concerning its determination with 

respect to the burden and costs and 

therefore uses the same affirmation here. 

Title: Western Electricity 

Coordinating Council Regional 

Reliability Standard Regarding 

Automatic Time Error Correction. 

Action: Final Rule. 

OMB Control No.: 1902–0244. 

Respondents: Businesses or other forprofit institutions; not-for-profit 

institutions. 

Frequency of Responses: On occasion. 

Necessity of the Information: This 

Final Rule approves and requires 

modification to one regional Reliability 

Standard that pertains to automatic time 

error correction in the Western 

Interconnection. The Final Rule finds 

the Reliability Standard to be just, 

reasonable, not unduly discriminatory 

or preferential, and in the public 

interest. 

59. Interested persons may obtain 

information on the reporting 

requirements by contacting: Federal 

Federal Register / Vol. 74, No. 101 / Thursday, May 28, 2009 / Rules and Regulations 25429 

43Regulations Implementing the National 

Environmental Policy Act, Order No. 486, FERC 

Stats. & Regs. ¶ 30,783 (1987). 44 18 CFR 380.4(a)(2)(ii). 45 5 U.S.C. 601–12. 

Energy Regulatory Commission, Attn: 

Michael Miller, Office of the Executive 

Director, 888 First Street, NE., 

Washington, DC 20426, Tel: (202) 502– 

8415, Fax: (202) 273–0873, E-mail: 

michael.miller@ferc.gov, or by 

contacting: Office of Information and 

Regulatory Affairs, Attn: Desk Officer 

for the Federal Energy Regulatory 

Commission (Re: OMB Control No. 

1902–0244), Washington, DC 20503, 

Tel: (202) 395–4650, Fax: (202) 395– 

7285, E-mail: 

oira_submission@omb.eop.gov. 

IV. Environmental Analysis 

60. 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.43 The Commission has 

categorically excluded certain actions 

from this requirement as not having a 

significant effect on the human 

environment. Included in the exclusion 

are rules that are clarifying, corrective, 

or procedural or that do not 

substantially change the effect of the 

regulations being amended.44 The 

actions proposed herein fall within this 

categorical exclusion in the 

Commission’s regulations. 

V. Regulatory Flexibility Act 

61. The Regulatory Flexibility Act of 

1980 (RFA) 45 generally requires a 

description and analysis of Final 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 that minimize any 

significant economic impact on a 

substantial number of small entities. 

The Small Business Administration’s 

Office of Size Standards develops the 

numerical definition of a small 

business. (See 13 CFR 121.201.) For 

electric utilities, a firm is small if, 

including its affiliates, it is primarily 

engaged in the transmission, generation 

and/or distribution of electric energy for 

sale and its total electric output for the 

preceding twelve months did not exceed 

four million megawatt hours. 

62. As noted above, the regional 

reliability standard would apply to 

about 35 balancing areas in the Western 

Interconnection. The Commission 

estimates that of these balancing areas, 

approximately two to four qualify as 

small entities, because the total electric 

output of each of these entities for the 

preceding twelve months did not exceed 

four million megawatt hours. Thus, few 

small entities are impacted by the 

proposed rule. 

63. Based on this understanding, the 

Commission certifies that this Final 

Rule will not have a significant 

economic impact on a substantial 

number of small entities. Accordingly, 

no regulatory flexibility analysis is 

required. 

VI. Document Availability 

64. 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 

FERC’s Home Page (http://www.ferc.gov) 

and in FERC’s Public Reference Room 

during normal business hours (8:30 a.m. 

to 5 p.m. Eastern time) at 888 First 

Street, NE., Room 2A, Washington, DC 

20426. 

65. From FERC’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. 

66. User assistance is available for 

eLibrary and the FERC’s Web site during 

normal business hours from FERC 

Online Support at (202) 502–6652 (toll 

free at 1–866–208–3676) or e-mail at 

ferconlinesupport@ferc.gov, or the 

Public Reference Room at (202) 502– 

8371, TTY (202) 502–8659. E-mail the 

Public Reference Room at 

public.referenceroom@ferc.gov. 

VII. Effective Date and Congressional 

Notification 

67. The Reliability Standard approved 

in this Final Rule is effective June 29, 

2009. The Commission has determined, 

with the concurrence of the 

Administrator of the Office of 

Information and Regulatory Affairs of 

OMB, that this rule is not a ‘‘major rule’’ 

as defined in section 351 of the Small 

Business Regulatory Enforcement 

Fairness Act of 1996. 

List of Subjects in 18 CFR Part 40 

Electric power, Electric utilities, 

Reporting and recordkeeping 

requirements. 

By the Commission. 

Nathaniel J. Davis, Sr., 

Deputy Secretary. 

[FR Doc. E9–12351 Filed 5–27–09; 8:45 am] 

BILLING CODE 6717–01–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 1 

[TD 9450] 

RIN 1545–BE73 

Information Reporting for Lump-Sum 

Timber Sales 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Final regulations. 

SUMMARY: This document contains final 

regulations that provide guidance 

regarding the information reporting 

requirements contained in section 

6045(e) of the Internal Revenue Code 

(Code) on sales or exchanges of standing 

timber for lump-sum (outright) 

payments. The final regulations amend 

§ 1.6045–4 of the Income Tax 

Regulations to require real estate 

reporting persons, as defined in section 

6045(e)(2) of the Code, to report lumpsum payments received by sellers 

(landowners) for sales or exchanges of 

standing timber. The final regulations 

do not change the information reporting 

requirements that currently apply to 

sales or exchanges of standing timber for 

pay-as-cut (contingent) payments under 

section 6050N of the Code. 

DATES: 

Effective date: These regulations are 

effective on May 28, 2009. 

Applicability date: The amendments 

to paragraphs (b)(2)(i)(E), (b)(2)(ii) and 

(c)(2)(i) of § 1.6045–4 shall apply to 

sales or exchanges of standing timber for 

lump-sum payments completed after 

May 28, 2009. 

FOR FURTHER INFORMATION CONTACT: 

Timothy S. Sheppard of the Office of 

Chief Counsel (Procedure and 

Administration), at (202) 622–4910. 

SUPPLEMENTARY INFORMATION: 

Paperwork Reduction Act 

The collection of information 

contained in these final regulations has 

been reviewed and approved by the 

Office of Management and Budget 

(OMB) in accordance with the 

Paperwork Reduction Act of 1995 (44 

U.S.C. 3507(d)) under control number 

1545–1085. The collection of 

information in these final regulations is