Document ID: FERC-2010-1565-0001
Agency: ferc
Document Type: Proposed Rule
Title: Planning Resource Adequacy Assessment Reliability Standard
Posted Date: 2010-10-27T04:00Z

[Federal Register: October 27, 2010 (Volume 75, Number 207)]
[Proposed Rules]               
[Page 66038-66046]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr27oc10-18]                         

[[Page 66038]]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 40

[Docket No. RM10-10-000]

 
Planning Resource Adequacy Assessment Reliability Standard

Issued October 21, 2010.
AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Notice of proposed rulemaking.

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SUMMARY: Under section 215(d)(2) of the Federal Power Act (FPA), the 
Federal Energy Regulatory Commission proposes to approve a regional 
Reliability Standard, BAL-502-RFC-02, Planning Resource Adequacy 
Analysis, Assessment and Documentation, developed by ReliabilityFirst 
Corporation (RFC) and submitted to the Commission by the North American 
Electric Reliability Corporation (NERC). The proposed regional 
Reliability Standard requires planning coordinators within the RFC 
geographical footprint to analyze, assess and document resource 
adequacy for load in the RFC footprint annually, to utilize a ``one day 
in ten year'' loss of load criterion, and to document and post load and 
resource capability in each area or transmission-constrained sub-area 
identified.

DATES: Comments are due December 27, 2010.

ADDRESSES: You may submit comments, identified by docket number and in 
accordance with the requirements posted on the Commission's Web site, 
http://www.ferc.gov. Comments may be submitted by any of the following 
methods:
     Electronic Submission: Documents created electronically 
using word processing software should be filed in native applications 
or print-to-PDF format, and not in a scanned format, at http://
www.ferc.gov/docs-filing/efiling.asp.
     Mail/Hand Delivery: Commenters unable to file comments 
electronically must mail or hand deliver an original copy of their 
comments to: Federal Energy Regulatory Commission, Secretary of the 
Commission, 888 First Street, NE., Washington, DC 20426. These 
requirements can be found on the Commission's Web site, see, e.g., the 
``Quick Reference Guide for Paper Submissions,'' available at http://
www.ferc.gov/docs-filing/efiling.asp, or via phone from FERC Online 
Support at 202-502-6652 or toll-free at 1-866-208-3676.

FOR FURTHER INFORMATION CONTACT:

Karin L. Larson (Legal Information), Office of the General Counsel, 
Federal Energy Regulatory Commission, 888 First Street, NE., 
Washington, DC 20426, (202) 502-8236.
Scott Sells (Technical Information), Office of Electric Reliability, 
Division of Policy Analysis and Rulemaking, Federal Energy Regulatory 
Commission, 888 First Street, NE., Washington, DC 20426, (202) 502-
6664.

SUPPLEMENTARY INFORMATION:

Notice of Proposed Rulemaking

    1. Under section 215(d)(2) of the Federal Power Act (FPA), the 
Federal Energy Regulatory Commission proposes to approve a regional 
Reliability Standard BAL-502-RFC-02 (Planning Resource Adequacy 
Analysis, Assessment and Documentation), developed by ReliabilityFirst 
Corporation (RFC) and submitted to the Commission by the North American 
Electric Reliability Corporation (NERC). The proposed regional 
Reliability Standard requires planning coordinators within the RFC 
geographical footprint to analyze, assess and document resource 
adequacy for load in the RFC footprint annually, to utilize a ``one day 
in ten year'' loss of load criterion, and to document and post load and 
resource capability in each area or transmission-constrained sub-area 
identified.

I. Background

A. Mandatory Reliability Standards

    2. Section 215 of the FPA requires a Commission-certified Electric 
Reliability Organization (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.\1\ In July 2006, the Commission certified NERC as the 
ERO.\2\
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    \1\ See 16 U.S.C. 824o(e)(3).
    \2\ North American Electric Reliability Corp., 116 FERC ] 61,062 
(ERO Certification Order), order on reh'g and compliance, 117 FERC ] 
61,126 (2006), aff'd sub nom. Alcoa, Inc. v. FERC, 564 F.3d 1342 
(D.C. Cir. 2009).
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    3. Reliability Standards that the ERO proposes to the Commission 
may include Reliability Standards that are developed by a Regional 
Entity.\3\ A Regional Entity is an entity that has been approved by the 
Commission to enforce Reliability Standards under delegated authority 
from the ERO.\4\ In Order No. 672, the Commission urged uniformity of 
Reliability Standards, but recognized a potential need for regional 
differences.\5\ Accordingly, the Commission stated that:
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    \3\ 16 U.S.C. 824o(e)(4).
    \4\ Id. at 824o(a)(7) and (e)(4).
    \5\ Rules 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, at P 290; order on reh'g, Order No. 672-A, 
FERC Stats. & Regs. ] 31,212 (2006).

    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 under 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.\6\
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    \6\ Order No. 672, FERC Stats. & Regs. ] 31,204 at P 291.

    4. Consistent with section 215 of the FPA, the Commission will 
approve proposed regional Reliability Standard BAL-502-RFC-02 if the 
Commission finds it is just, reasonable, not unduly discriminatory or 
preferential, and in the public interest.

B. ReliabilityFirst

    5. On April 19, 2007, the Commission approved delegation agreements 
between NERC and eight Regional Entities.\7\ 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 RFC as a Regional Entity and accepted RFC's 
Standards Development Manual which sets forth the process for RFC's 
development of regional Reliability Standards.\8\ The RFC region is a 
less than interconnection-wide region that covers all or portions of 14 
states and the District of Columbia.
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    \7\ See North American Electric Reliability Corp., 119 FERC ] 
61,060, at P 316-350 (Delegation Agreement Order), order on reh'g, 
120 FERC ] 61,260 (2007).
    \8\ Id. P 339 (clarifying that the RFC Standards Development 
Manual embodies ``rules'' which are subject to NERC approval and, if 
approved by NERC, Commission approval).
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II. RFC Regional Reliability Standard BAL-502-RFC-02

    6. On December 14, 2009, NERC submitted for Commission approval, in 
accordance with section 215(d)(1) of the

[[Page 66039]]

FPA,\9\ regional Reliability Standard BAL-502-RFC-02 and four 
associated new definitions.\10\ The stated purpose of regional 
Reliability Standard BAL-502-RFC-02 is to establish common criteria, 
based on ``one day in ten year'' loss of load expectation principles, 
for the analysis, assessment and documentation of resource adequacy in 
the RFC region.\11\ NERC states that the proposed regional Reliability 
Standard establishes requirements for planning coordinators in the RFC 
region regarding resource adequacy assessment, which subject matter is 
not currently addressed in NERC's continent-wide Reliability 
Standards.\12\
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    \9\ 16 U.S.C. 824o.
    \10\ NERC Petition for Approval of Proposed RFC Regional 
Reliability Standard BAL-502-RFC-02, Docket No. RM10-10-000 (Dec. 
14, 2009) (Petition).
    \11\ NERC Petition at 7.
    \12\ Id. at 7. NERC notes that it has a pending continent-wide 
project, Project 2009-05, Resource Adequacy Assessments, that is 
intended to address resource adequacy assessments. This NERC project 
has a targeted completion date of third quarter 2011.
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    7. Proposed regional Reliability Standard BAL-502-RFC-02 contains 
two Requirements, which are applicable to each planning coordinator 
within the RFC footprint.\13\ Requirement R1 requires each planning 
coordinator to perform and document an annual resource adequacy 
analysis.\14\ The seven Sub-requirements define the criteria to be used 
for the resource adequacy analysis. Sub-requirement R1.1 sets forth the 
``one day in ten year'' criteria to be used to calculate the planning 
reserve margin. Sub-requirement R1.2 specifies the planning years to be 
studied. Sub-requirement R1.3 defines system characteristics to be 
included in the analysis. Sub-requirements R1.4 and R1.5 require the 
consideration of resource availability and transmission outage plans. 
Sub-requirements R1.6 and R1.7 require documentation that capacity 
resources and load were properly accounted for in the analysis. 
Requirement R2 requires each planning coordinator to annually document 
the projected load and resource capability for each area and 
transmission constrained sub-area identified in the analysis. Sub-
requirements R2.1 through R2.3 set forth the specific documentation 
requirements. Each of the main Requirements (R1 and R2) are assigned a 
violation risk factor (VRF) and violation severity level (VSL). 
However, RFC did not assign VRFs or VSLs to the Sub-requirements.
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    \13\ According to the RFC April 16, 2010 organization 
registration (available at http://rfirst.org/Compliance/
Registration.aspx), there are four registered planning coordinators 
in the RFC region, each of which is a RFC member. See RFC's January 
11, 2010 list of member companies by sector, available at http://
rfirst.org/MiscForms/AboutUs/Membership.aspx. The four registered 
planning coordinators are American Transmission Co., LLC; 
International Transmission Company (ITC Transmission); Midwest 
Independent Transmission System Operator, Inc. (Midwest ISO); and 
PJM Interconnection, LLC (PJM).
    \14\ NERC notes that the proposed Reliability Standard does not 
require the building or acquisition of new generating capacity. See 
NERC Petition at 9.
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    8. NERC also proposes to add the following four new definitions, 
which would be applicable in the RFC region only:

    Resource Adequacy: The ability of supply-side and demand-side 
resources to meet the aggregate electrical demand (including 
losses).
    Net Internal Demand: Total of all end-use customer demand and 
electric system losses within specified metered boundaries, less 
Direct Control Load Management and Interruptible Demand.
    Peak Period: A period consisting of two (2) or more calendar 
months but less than seven (7) calendar months, which includes the 
period during which the responsible entity's annual peak demand is 
expected to occur.
    Year One: The planning year that begins with the upcoming annual 
Peak Period.

    NERC states that these four terms do not presently appear in the 
NERC Glossary of Terms Used in Reliability Standards (Glossary) and 
they do not conflict with existing terms.\15\
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    \15\ The NERC Glossary (updated Apr. 20, 2010) is available at 
http://www.nerc.com/docs/standards/rs/Glossary_of_Terms_
2010April20.pdf.
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    9. NERC states that on February 24, 2009, RFC submitted the 
proposed Reliability Standard to NERC for evaluation and approval. On 
April 17, 2009, NERC provided RFC its evaluation of BAL-502-RFC-02 
which highlighted several concerns regarding the proposed standard. 
NERC's concerns included: (1) Missing time horizons, (2) effective date 
not meeting NERC's template language, (3) complex sub-requirements, (4) 
the addition of new defined terms, (5) the assignment of VRFs and VSLs 
only to the Reliability Standard's two main Requirements and not the 
sub-requirements, and (6) technical clarity. On June 8, 2009, RFC 
submitted a response to NERC addressing NERC's concerns.
    10. NERC concludes that the proposed RFC regional Reliability 
Standard addresses matters not currently covered in a continent-wide 
NERC Reliability Standard and thus meets the Commission's criteria for 
consideration of a regional Reliability Standard. NERC asserts that the 
proposed regional Reliability Standard satisfies all of the criteria 
set forth in Order No. 672 that the Commission applies to determine 
whether a proposed Reliability Standard is just, reasonable, not unduly 
discriminatory or preferential and in the public interest.\16\ As such, 
NERC requests approval of proposed regional Reliability Standard BAL-
502-RFC-02 and the related definitions.
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    \16\ Order No. 672, FERC Stats. & Regs. ] 31,204 at P 323-337.
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III. Discussion

    11. As discussed below, the Commission proposes to approve BAL-502-
RFC-02. The proposed regional Reliability Standard will improve the 
reliable operation of the Bulk-Power System by ensuring use in the RFC 
region of a common criterion, the ``one day in ten year'' principle, to 
assess resource adequacy during the planning horizon. The Commission 
also proposes to accept the four related definitions for inclusion in 
NERC's Glossary for use with RFC's regional Reliability Standards.\17\ 
The Commission further proposes to defer discussion on the proposed 
VRFs and VSLs for the regional Reliability Standard.
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    \17\ NERC's Glossary lists each term that has been defined for 
use in one or more of NERC's continent-wide or regional Reliability 
Standards.
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    12. Proposed regional Reliability Standard BAL-502-RFC-02 is ``more 
stringent'' in that NERC's continent-wide standards currently do not 
address assessment of Resource Adequacy in the planning horizon. The 
Commission notes the current continent-wide Reliability Standard TOP-
002-2a, Requirement R7 requires Balancing Authorities to plan to meet 
capacity and energy reserve requirements, including the deliverability/
capability for any single contingency.\18\ Reliability Standard TOP-
002-2 ensures that resources and operational plans are in place to 
enable system operators to maintain the Bulk-Power System in a reliable 
state.\19\ Thus Reliability Standard TOP-002-2 is a continent-wide 
Reliability Standard that addresses requirements for reserves during 
the operations timeframe whereas proposed regional Reliability Standard 
BAL-502-RFC-02 addresses the assessment of resource adequacy (or 
planning reserves) during the planning timeframe. If NERC develops a 
continent-wide Reliability Standard that addresses assessment of 
resource adequacy in the planning horizon and such Reliability Standard 
is approved by the Commission, RFC should

[[Page 66040]]

reevaluate the continuing need for regional Reliability Standard BAL-
502-RFC-02.
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    \18\ Reliability Standard TOP-002-2a, Requirement R7.
    \19\ Mandatory Reliability Standards for the Bulk-Power System, 
Order No. 693, FERC Stats. & Regs. ] 31,242, at P 1590, order on 
reh'g, Order No. 693-A, 120 FERC ] 61,053 (2007). See also the 
Notice of Proposed Rulemaking, Docket No. RM06-16-000, FERC Stats. & 
Regs., Proposed Regulations 2004-2007, ] 32,608 (2006) (Order No. 
693 NOPR).
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A. Order No. 672 Criteria

    13. Order No. 672 provides that a Reliability Standard must be 
designed to achieve a specified reliability goal and must contain a 
technically sound means to achieve this goal.\20\ Likewise, the 
Reliability Standard should be based on actual data and lessons learned 
from actual operations.\21\ According to NERC and RFC, proposed 
regional Reliability Standard BAL-502-RFC-02 is clear and unambiguous 
regarding what is required and who is required to comply (planning 
coordinator). NERC and RFC also state that BAL-502-RFC-02 has clear and 
objective measures for compliance and achieves a reliability goal 
(namely, providing a common framework for resource adequacy analysis, 
assessment, and documentation) effectively and efficiently. Based on 
the Commission's understanding of the proposed regional Reliability 
Standard, explained below, the Commission believes that BAL-502-RFC-02 
satisfies the Order No. 672 criteria.
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    \20\ Order No. 672, FERC Stats. & Regs. ] 31,204 at P 324.
    \21\ Id.
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B. RFC's Proposed Resource Adequacy Reliability Standard Requirements

    14. Proposed regional Reliability Standard BAL-502-RFC-02 requires 
planning coordinators to perform an annual Resource Adequacy analysis 
and calculate a planning reserve margin that meets the ``one day in ten 
year'' criterion. The analysis must be ``performed or verified 
separately'' for (i) Year One, (ii) for one year falling in the second 
through fifth years, and (iii) at least one year in the sixth through 
tenth years.\22\ The regional Reliability Standard further requires the 
planning coordinators to calculate the planning reserve margin by 
assessing each of the integrated peak hours for each day within the 
year being analyzed to determine the probability that generation and 
demand-side resources cannot meet the demand during that hour for that 
day (which would result in a loss of load).\23\ The calculated planning 
reserve margin is to be expressed as a percentage of the median 
forecast peak demand (not including direct control load management and 
interruptible demand). Regional Reliability Standard BAL-502-RFC-02 
states that this median forecast is expected to have a 50 percent 
probability that the projected load is too high and 50 percent 
probability that the projected load is too low.\24\ In order to 
determine the appropriate load forecast, the planning coordinators must 
consider multiple factors including: (i) Variability in the load 
forecast such as weather and regional economic forecasts, (ii) load 
diversity, (iii) seasonal load variations, (iv) firm load and (v) 
interruptible load including contractual arrangements concerning 
curtailable and/or interruptible demand.\25\ In addition, the planning 
coordinator must document that all load in its area is accounted for in 
the analysis.\26\
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    \22\ See proposed Reliability Standard BAL-502-RFC-02, 
Requirement R1.2.
    \23\ See id. at Requirement R1.1.
    \24\ See id. at Requirement R1.1.2 n.2.
    \25\ See id. at Requirement R1.3.1.
    \26\ See id. at Requirements R1.7.
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    15. Further, the planning coordinator must determine the 
probability of resources that will be online and available, determine 
the distribution of the peak load for each day, and include impacts of 
known transmission limitations.\27\ To determine the probability of 
available resources the planning coordinator must consider multiple 
factors. Such factors include: (i) The historic resource performance, 
(ii) seasonal resource ratings, (iii) firm capacity purchases from and 
sales to entities outside of the planning coordinator area, (iv) 
resource planned outage schedules, (v) deratings and retirements, (vi) 
assumptions of intermittent and energy limited resources (such as wind 
and cogeneration), (vii) criteria for including planned resource 
additions, (viii) availability and delivery of fuel, (ix) common mode 
outages that affect resource availability, (x) environmental and 
regulatory restrictions of resources, (xi) available demand response 
programs, (xii) sensitivity to resource outage rates, (xiii) extreme 
weather/drought condition impacts on resource availability, (xiv) 
assumptions for emergency operation procedures in order to make 
reserves available, and (xv) uncommitted resources within the planning 
coordinator area.\28\ Also, the planning coordinator must document that 
all capacity resources in the planning coordinator area are 
appropriately accounted for in the analysis.\29\
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    \27\ See id. at Requirements R1.3.1, R1.3.2, and R1.3.3.
    \28\ See id. at Requirements R1.3.2 and R1.4.
    \29\ See id. at Requirement R1.6.
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    16. The planning coordinator is also required to consider the 
impacts of transmission limitations that could prevent the delivery of 
generation to the load including criteria for including planned 
transmission facilities in the study as well as transmission 
maintenance outage schedules.\30\ Proposed regional Reliability 
Standard BAL-502-RFC-02, Requirement R1.3.4 requires planning 
coordinators to include in their assessment of transmission limits 
assistance from other interconnected systems including multi-area 
assessment considering transmission limitations into the study area.
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    \30\ See id. at Requirements R1.3.3, R1.3.3.1, R1.3.3.2 and 
R1.5.
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    17. Overall, the Commission believes that factors to be considered 
in the resource adequacy analysis as set forth in Requirement R1 and, 
as discussed above, are a technically sound means to set up the 
analysis for the probability of not having enough resources in order to 
meet demand and avoid loss of load. However, the Commission questions 
or seeks clarity on three details of the resource adequacy analysis: 
(i) The loss of load calculation, (ii) use of capacity benefit margin; 
and (iii) meaning of common mode outages.
    18. Requirement R1.1 states that the assessment shall calculate a 
planning reserve margin that will result in the sum of probabilities 
for loss of load for each planning year equal to 0.1, or comparable to 
``one day in ten years'' when available capacity will not meet the 
load. With respect to the loss of load calculation, proposed regional 
Reliability Standard BAL-502-RFC-02 specifically identifies two 
circumstances that will not count in the loss of load calculation: (1) 
Utilization of direct control load management \31\ and (2) curtailment 
of interruptible load.\32\ Notwithstanding these two exceptions to the 
loss of load calculation, the Commission seeks comment on how other 
actions that could be taken by a system operator, such as voltage 
reduction or other, non-voluntary, types of load reduction plans, would 
be modeled and documented in this analysis.
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    \31\ NERC defines direct control load management (DCLM) as 
``Demand-Side Management that is under the direct control of the 
system operator. DCLM may control the electric supply to individual 
appliances or equipment on customer premises. DCLM as defined here 
does not include Interruptible Demand.''
    \32\ NERC defines Interruptible Load as ``Demand that the end-
use customer makes available to its Load-Serving Entity via contract 
or agreements for curtailment.''
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    19. With respect to the capacity benefit margin, the Commission 
notes that the requirements do not explicitly state whether planning 
coordinators may rely upon capacity benefit

[[Page 66041]]

margin \33\ to satisfy BAL-502-RFC-02's Requirements. During the 
standard development posting period, RFC received comments regarding 
potential conflicts or lack of coordination between BAL-502-RFC-02 and 
MOD-004-1--Capacity Benefit Margin.\34\ The Commission does not believe 
the proposed regional Reliability Standard is in conflict with the 
continent-wide Reliability Standard, but does note there could be some 
confusion regarding whether capacity benefit margin could or could not 
be used in order to meet the Requirements of BAL-502-RFC-02.\35\ 
Accordingly, we seek comment on whether capacity benefit margin may be 
used to satisfy BAL-502-RFC-02's Requirements.
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    \33\ The NERC Glossary defines capacity benefit margin (CBM) as 
``the amount of firm transmission transfer capability preserved by 
the transmission provider for Load-Serving Entities (LSE), whose 
loads are located on that Transmission Service Provider's system, to 
enable access by the LSEs to generation from interconnected systems 
to meet generation reliability requirements. Preservation of CBM for 
an LSE allows that entity to reduce its installed generating 
capacity below that which may otherwise have been necessary without 
interconnections to meet its generation reliability requirements. 
The transmission transfer capability preserved as CBM is intended to 
be used by the LSE only in times of emergency generation 
deficiencies.''
    \34\ See NERC Petition, Exhibit C, comments from ITC 
Transmission.
    \35\ Reliability Standard MOD-004-1 addresses capacity benefit 
margin, or a capacity preserved for firm transmission transfer 
capability. Conversely, the Requirements in proposed Reliability 
Standard BAL-502-RFC-02 address an analysis regarding the capability 
of generation to serve the projected load. While capacity benefit 
margin could be a method of meeting the requirements of BAL-502-RFC-
02, the two standards do not contradict each other.
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    20. With respect to Requirement R1.4, which requires the resource 
adequacy analysis to consider resource availability characteristics 
including ``common mode outages that affect resource availability,'' 
the Commission seeks comment on whether planning coordinators, when 
evaluating ``common mode outages that affect resource availability'' 
will consider only outages within the generation facility, or if the 
analysis will also include outages of transmission facilities that 
would have an impact on resource or generator availability.

C. Missing Time Horizons

    21. NERC's Petition notes its concern that the proposed regional 
Reliability Standard BAL-502-RFC-02 does not identify time horizons for 
each Requirement. Time horizons are used as a factor in determining the 
size of a sanction. If an entity violates a Requirement and there is no 
time to mitigate the violation because the Requirement takes place in 
real-time, then the sanction associated with the violation is higher 
than it would be for violation of a Requirement that could be mitigated 
over a longer period of time.\36\ According to NERC's template for 
Reliability Standards, each main Requirement in a Reliability Standard 
should be assigned one of the following time horizons: (1) Long-Term 
Planning (a planning horizon of one year or longer), (2) Operations 
Planning (operating and resource plans from day-ahead up to and 
including seasonal), (3) Same-day Operations (routine actions required 
within the timeframe of a day, but not real-time), (4) Real-time 
Operations (actions required within one hour or less to preserve the 
reliability of the bulk electric system), and (5) Operations Assessment 
(follow-up evaluations and reporting of real time operations).
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    \36\ See NERC's ``Time Horizons'' document, available on NERC's 
Web site at http://www.nerc.com/files/Time_Horizons.pdf.
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    22. According to NERC, time horizons are used for compliance 
assessments as described in NERC's Sanctions Guidelines.\37\ Time 
horizons are used when determining the severity of a violation risk 
factor and for determining the penalty for a violation. RFC states that 
it did not include time horizons because its Reliability Standards 
Development Procedure (RSDP) does not include time horizons in its 
template for Reliability Standards. The RFC RSDP sets forth the 
required elements of a Standard and includes a Reliability Standard 
template. RFC's RSDP does not include ``time horizons'' as a required 
element.\38\ Thus, RFC states that including time horizons in BAL-502-
RFC-02 would have been a deviation from its Commission-approved 
Standards template. RFC also notes that ``the standard focuses on 
`planning oriented' subject matter for one year and beyond,'' and, as 
such, the ``appropriate time horizons are relatively straight 
forward.'' \39\
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    \37\ NERC Petition at 22.
    \38\ RFC Reliability Standards Development Procedure, at 3 (May 
22, 2008) available at http://www.rfirst.org/Documents/Standards/
Reliability%20Standards%20Developmental%20Procedure.pdf.
    \39\ NERC Petition at 24.
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    23. The Commission agrees with NERC that it is important to 
identify the time horizons for each Reliability Standard. However, time 
horizons are not critical to our determination of whether to approve 
this proposed Reliability Standard. As the Commission has previously 
stated, the ``most critical element of a Reliability Standard is the 
Requirements.'' \40\ Moreover, the Commission notes that with respect 
to proposed regional Reliability Standard BAL-502-RFC-02, the time 
horizon ``Long-Term Planning'' can be gleaned from the context of the 
standard for the purpose of determining the severity of a violation 
risk factor, or for determining the penalty for a violation. However, 
the Commission notes that RFC currently is in the process of modifying 
its RSDP such that it will be required to use the most current version 
of the approved NERC Reliability Standard template when developing a 
RFC regional Reliability Standard.\41\ NERC's ``Template Guide for New 
Standards,'' ``Template Quality Review of Standards,'' and ``Time 
Horizons'' documents all call for the inclusion of time horizons in new 
Reliability Standards.\42\ Thus RFC's proposed change to its RSDP would 
require RFC to tag each new Reliability Standard Requirement with a 
time horizon. We believe that the identification of the appropriate 
time horizon for each Requirement is useful and improves clarity and 
consistency in compliance assessments. Because RFC appears to be moving 
toward requiring the assignment of time horizons as part of its 
standard drafting process, as well as the benefits of assigning time 
horizons, the Commission proposes to direct RFC to add time horizons to 
the two main Requirements when RFC reviews regional Reliability 
Standard BAL-502-RFC-02 in its scheduled five-year review.
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    \40\ Order No. 693 NOPR, FERC Stats. & Regs., Proposed 
Regulations 2004-2007, ] 32,608 at p. 105.
    \41\ RFC project SDP-501-RFC-03 was posted for 15-day category 
ballot the ``Draft 2 Standards Development Procedure'' on Sept. 1, 
2010 and can be found on RFC's Web site at http://rsvp.rfirst.org/
SDP501RFC03/default.aspx.
    \42\ The ``Template Guide for New Standards,'' ``Template 
Quality Review of Standards,'' and ``Time Horizons'' documents can 
all be found on the NERC Web site at http://www.nerc.com/
commondocs.php?cd=2.
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D. Proposed Effective Date

    24. Proposed regional Reliability Standard BAL-502-RFC-02's stated 
effective date is ``upon RFC Board approval,'' which occurred on 
December 4, 2008. NERC raises the concern that ``[t]he effective date 
should follow the latest language found in the [NERC] standards 
template to meet the needs of the compliance program.'' \43\ NERC's 
``standards template'' provides that the effective date should be ``the 
first day of the first quarter after regulatory approval.'' \44\ RFC 
responded that the proposed RFC Board approval effective date set forth 
in BAL-502-RFC-02 is appropriate because of the regional nature of the 
Standard and because the

[[Page 66042]]

Requirements under BAL-502-RFC-02 are already being implemented. 
Specifically, RFC noted that upon RFC Board approval, BAL-502-RFC-02 
became effective and enforceable with respect to RFC members under 
their ``Terms of Membership'' contained in RFC's bylaws.\45\ Because 
BAL-502-RFC-02 only applies to planning coordinators within RFC's 
region, all of which are RFC members, BAL-502-RFC-02's Requirements are 
currently effective. As such, no additional implementation time is 
required.\46\ RFC acknowledges that upon Commission approval, the 
Reliability Standard will be mandatory and enforceable, and that non-
compliance will be subject to financial penalties.
---------------------------------------------------------------------------

    \43\ NERC Petition at 22.
    \44\ Id.
    \45\ Pursuant to RFC's bylaws, RFC members are subject to a 
regional Reliability Standard once the Standard is approved by the 
RFC Board. Although a Board-approved Standard is enforceable under 
the RFC bylaws as a term of membership, a member would not be 
subject to potential financial penalties. See NERC Petition at 25.
    \46\ Id.
---------------------------------------------------------------------------

    25. We propose to find that with respect to proposed Reliability 
Standard BAL-502-RFC-02, no additional implementation time is required 
as the four registered planning coordinators in the RFC region, as RFC 
members, are already operating under the Standard.\47\ There are no 
other planning coordinators to whom the requirements will apply after 
Commission approval. While we note that reliability standards are 
generally implemented prospectively, in this case the real impact of 
Commission approval is to make BAL-502-RFC-02 prospectively enforceable 
through civil penalties. Accordingly, the Commission proposes that 
Reliability Standard BAL-502-RFC-02 will become mandatory and 
enforceable on the effective date of the Commission's final rule 
approving the Reliability Standard.
---------------------------------------------------------------------------

    \47\ The Commission notes that under the current NERC compliance 
registry entities register as ``planning authorities,'' not 
``planning coordinators.'' NERC defines ``planning coordinator'' in 
its Glossary by simply referencing ``See Planning Authority.'' The 
Commission understands that for reliability purposes planning 
authorities and planning coordinators are interchangeable. Thus any 
entity registered with NERC as a planning authority is subject to 
any Reliability Standard that applies to planning coordinators.
---------------------------------------------------------------------------

E. Provision of Data

    26. Proposed Reliability Standard BAL-502-RFC-02 requires planning 
coordinators to perform a resource adequacy analysis and assessment. 
Gathering data is a necessary component of doing so. The Commission is 
concerned that proposed Reliability Standard BAL-502-RFC-02 does not 
require other entities (load-serving entities, balancing authorities, 
transmission operators, resource planners, or transmission planners) to 
provide the planning coordinators subject to BAL-502-RFC-02 the 
necessary data for the resource adequacy analysis. In short, the 
Commission is concerned that planning coordinators will be subject to a 
mandatory and enforceable Reliability Standard without the necessary 
tools to fulfill the Standard's Requirements. The Commission recognizes 
that this concern is somewhat alleviated by the fact that, within the 
RFC, many of the planning coordinators are also the entities that would 
have the needed data,\48\ or may obtain some of the needed data as a 
result of some continent-wide Reliability Standards' Requirements.\49\ 
The Commission invites comment on whether the planning coordinators 
have encountered problems with collecting necessary data in order to 
complete the resource adequacy assessment that is the subject of BAL-
502-RFC-02.
---------------------------------------------------------------------------

    \48\ The four planning coordinators currently registered in RFC 
are also registered as other functional entities. American 
Transmission Co., LLC and ITC Transmission are both registered as 
transmission owners, transmission operators and transmission 
planners. Midwest ISO is registered as a balancing authority, 
interchange authority, reliability coordinator and transmission 
service provider. PJM is registered as balancing authority, 
interchange authority, reliability coordinator, resource planner, 
transmission operator, transmission planner, and transmission 
service provider.
    \49\ For example, it appears that the following continent-wide 
Reliability Standards allow planning coordinators to obtain data 
needed to conduct the resource adequacy analysis and assessment: (i) 
MOD-001, Requirement R9 (requires transmission service providers to 
provide data regarding available transfer capability or available 
flowgate capability calculations to the planning coordinator upon 
request); (ii) MOD-004, Requirement R9 (requires transmission 
service providers and transmission planners to provide data used for 
determining or allocating CBM to the planning coordinator upon 
request); (iii) MOD-008, Requirement R3 (requires transmission 
operators to provide the TRM implementation document to the planning 
coordinator upon request); (iv) PRC-023, Requirements R2 and R3 
(gives planning coordinators access to facility ratings and the 
identification of facilities critical to reliability); and (v) TPL-
001, TPL-002, TPL-003 and TPL-004 (gives planning coordinators 
access to data related to the determination of whether the 
transmission system is planned to meet firm demand under certain 
conditions).
---------------------------------------------------------------------------

F. Regional Definitions

    27. Proposed regional Reliability Standard BAL-502-RFC-02 includes 
four new definitions that apply only to the RFC region: Resource 
Adequacy, Net Internal Demand, Peak Period, and Year One. NERC plans to 
publish the definitions in a distinct section of the NERC Glossary 
noting their limited applicability to entities within RFC.
    28. The Commission proposes to accept the four new defined terms to 
be applicable only in the RFC region. However, the Commission cautions 
NERC and the Regional Entities to be aware of ``a potential re-
proliferation of regional terminology, and consequently, the need to 
prevent possible inconsistent use of terminology among regions.'' \50\
---------------------------------------------------------------------------

    \50\ Western Electricity Coordinating Council Regional 
Reliability Standard Regarding Automatic Time Error Correction, 
Order No. 723, 127 FERC ] 61,176, at P 39 (2009) (Final Rule).
---------------------------------------------------------------------------

    29. For example, the Commission notes that RFC's proposed term 
``Resource Adequacy'' is used in NERC's continent-wide Reliability 
Standard MOD-004-1 \51\ as well as in NERC's definitions of 
``Generation Capability Import Requirement'' \52\ and ``Resource 
Planner'' \53\ as set forth in NERC's Glossary. While RFC's definition 
of ``Resource Adequacy'' does not appear to conflict with the use of 
this term within the continent-wide Reliability Standard MOD-004-1 or 
in NERC's Glossary, the addition of ``Resource Adequacy'' as a defined 
regional term highlights the need for NERC to remain vigilant regarding 
re-proliferation of regional terminology. This is particularly relevant 
with respect to terms like ``Resource Adequacy'' where other Regional 
Entities may have differing definitions of resource adequacy and 
differing understandings of how those definitions apply to the 
continent-wide Reliability Standard MOD-004-1 and NERC's defined terms 
``generation capability import requirement'' and ``resource planner.'' 
Accordingly, the Commission urges NERC and the Regional Entities to be 
vigilant to assure that any proposed regional definition is consistent 
with both NERC definitions and the approved terms used in other 
regions.
---------------------------------------------------------------------------

    \51\ Reliability Standard MOD-004-1--Capacity Benefit Margin, 
Requirements R4.1, R5.1 and R6.1 each include a bullet stating: 
``Reserve margin or resource adequacy requirements established by 
other entities, such as municipalities, state commissions, regional 
transmission organizations, independent system operators, Regional 
Reliability Organizations, or regional entities.'' (Emphasis added).
    \52\ ``Generation Capability Import Requirement'' is defined in 
the Glossary as: ``The amount of generation capability from external 
sources identified by a Load-Serving Entity (LSE) or Resource 
Planner (RP) to meet its generation reliability or resource adequacy 
requirements as an alternative to internal resources.''
    \53\ ``Resource Planner'' is defined as: ``The entity that 
develops a long-term (generally one year and beyond) plan for the 
resource adequacy of specific loads (customer demand and energy 
requirements) within a Planning Authority Area.''

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

[[Page 66043]]

G. Technical Recommendation (Resources Beyond RFC Footprint)

    30. With respect to proposed BAL-502-RFC-02, NERC raises the 
concern of ``how entities within RFC that have load and resources 
outside the RFC footprint account for these resources in their 
[resource adequacy] analysis.'' \54\ Specifically, NERC asked RFC to 
clarify if planning coordinators within the RFC footprint are expected 
to only include RFC load and resources in the analysis. RFC responded 
to NERC's technical recommendation stating:
---------------------------------------------------------------------------

    \54\ NERC Petition at 24.

    The intent is to cover all load within the RFC footprint. 
Planning Coordinators may include load outside the RFC footprint as 
deemed appropriate. Even if a Planning Coordinator has load outside 
of the ReliabilityFirst footprint, as long as it operates as a 
single area, the adequacy of that Planning Coordinator area will 
indicate adequacy of the part of the area within the 
ReliabilityFirst footprint. From a converse perspective, if the 
Planning Coordinator operates as a single area, that area must be 
assessed as a whole or the assessment will be inadequate for the 
area within the RFC footprint. (If transmission constraints exist, 
the Planning Coordinator's constrained areas would have to be 
addressed separately in any event.) \55\
---------------------------------------------------------------------------

    \55\ NERC Petition at Exhibit C, NERC's April 17, 2009 Quality 
Assurance Review Summary at 4.

    The Commission generally agrees with the response provided by RFC. 
However, as discussed in detail below, the Commission expects that a 
planning coordinator may benefit from a common process for including 
resources and loads outside of the RFC footprint in its resource 
adequacy analysis.
    31. As RFC noted in its response to NERC on this issue that in 
order to perform a valid assessment, it may be necessary to represent a 
portion of areas outside of the RFC footprint in order to determine the 
impact those areas may have on the footprint being analyzed. RFC has 
incorporated into the proposed regional Reliability Standard a high 
level of detail necessary to perform a valid assessment. Similarly, the 
Commission notes how NERC's continent-wide transmission planning 
Reliability Standards \56\ require a valid assessment, and explicitly 
state in the Standard what is expected to be completed in order to have 
a valid assessment. One important aspect of a valid assessment is that 
it should include an appropriate model of areas outside of the area 
being analyzed in order for the analysis to accurately represent what 
could be expected during actual operation.\57\
---------------------------------------------------------------------------

    \56\ Transmission Planning Reliability Standards TPL-001 
Requirement R1, TPL-002 Requirement R1, TPL-003 Requirement R1, and 
TPL-004 Requirement R1 all require a valid assessment stating: ``The 
Planning Authority and Transmission Planner shall each demonstrate 
through a valid assessment. * * *'' Further, the sub-requirements 
under Requirement R1 of each of the above-identified transmission 
planning Reliability Standards detail what is expected in order to 
have a valid assessment.
    \57\ Requirement R1.3.5 of Reliability Standards TPL-001 through 
TPL-003 and Requirement 1.3.4 of Reliability Standard TPL-004 state 
that in order to have a valid assessment, the simulation shall 
``have all projected firm transfers modeled.'' This is one example 
of how areas outside of the area being analyzed must be 
appropriately modeled in order to simulate the impact on the area 
being analyzed.
---------------------------------------------------------------------------

    Otherwise, the resource adequacy analysis could be skewed by 
showing adequacy within the RFC footprint while leaving out an 
inadequate area outside of the RFC footprint. To avoid this potential 
issue, the Commission expects that a RFC planning coordinator would 
have a common process or procedure that addresses the planning reserves 
assessments, which could include either (i) a methodology to determine 
whether or how the planning coordinator would include resources and 
loads outside of the RFC footprint in its resource adequacy analysis or 
(ii) models which the resource adequacy assessment should utilize that 
would already include the appropriate modeling of external areas. The 
Commission seeks comments on any concerns or suggestions to address 
load and resources outside of the RFC footprint during a planning 
assessment and also seeks comments on how entities currently perform 
this task or other similar planning tasks where load and resources 
occur outside of boundaries required by the assessment.

H. Planning Gap Identification

    32. Proposed regional Reliability Standard BAL-502-RFC-02 includes 
two main Requirements: (1) To annually perform and document resource 
adequacy analysis (R1); and (2) to annually document the projected load 
and resource capability for each area identified in the resource 
adequacy analysis (R2). BAL-502-RFC-02 does not include a Requirement 
to document any gap between the planning reserve margin calculated in 
R1.1 (the amount of planning reserve needed to ensure a ``one day in 
ten year'' criterion) and the actual planning reserve determined in the 
resource adequacy analysis.
    33. The Commission believes that it would be useful for planning 
coordinators to identify and document a deficiency in planning 
reserves. Identification of a planning gap could help ensure that 
entities are aware of potential risks regarding the capability to 
balance resources and demand in a planning timeframe. Acknowledging 
potential risk to the Bulk-Power System during the planning timeframe 
would allow affected entities time to develop a solution before the 
identified deficiency in planning reserves leads to adverse reliability 
impacts. For example, NERC's continent-wide transmission planning 
Reliability Standards \58\ include Requirements for entities to develop 
a corrective action plan when system simulations indicate an inability 
of the systems to respond as prescribed in the Standards. Accordingly, 
the Commission proposes to direct RFC, when reviewing BAL-502-RFC-02 
during its scheduled five-year review, to consider modifying BAL-502-
RFC-02 to include a Requirement to identify any gap between the needed 
amount of planning reserves defined in Requirement R1.1 and the 
planning reserves determined from the resource adequacy analysis. This 
would be a documentation Requirement only and would not require 
entities to install additional generation or transmission capacity.
---------------------------------------------------------------------------

    \58\ See Reliability Standards TPL-001-0, Requirements R2 and 
R3; TPL-002-0, Requirements R2 and R3; TPL-003-0, Requirements R2 
and R3; and TPL-004-0, Requirements R2 and R3.
---------------------------------------------------------------------------

I. Violation Risk Factors/Violation Security Levels

    34. To determine a base penalty amount for a violation of a 
Requirement within a Reliability Standard, NERC, or in this case RFC as 
the developer of proposed Reliability Standard BAL-502-RFC-02, must 
first determine an initial range for the base penalty amount. To do so, 
RFC is to assign a VRF to each Requirement and sub-Requirement of a 
Reliability Standard that relates to the expected or potential impact 
of a violation of the Requirement on the reliability of the Bulk-Power 
System. The Commission has established guidelines for evaluating the 
validity of each VRF assignment.\59\
---------------------------------------------------------------------------

    \59\ See North American Electric Reliability Corp., 119 FERC ] 
61,145, order on reh'g, 120 FERC ] 61,145, at P 8-13 (2007) 
(Violation Risk Factor Rehearing Order). The guidelines are: (1) 
Consistency with the conclusions of the Blackout Report; (2) 
consistency within a Reliability Standard; (3) consistency among 
Reliability Standards; (4) consistency with NERC's definition of the 
violation risk factor level; and (5) treatment of requirements that 
co-mingle more than one obligation.
---------------------------------------------------------------------------

    35. The Reliability Standard developer also is to assign each 
Requirement and sub-Requirement one of four VSLs--low, moderate, high, 
and severe--as measurements for the degree to which the Requirement was 
violated in a specific circumstance. On June 19, 2008, the Commission 
issued an order

[[Page 66044]]

establishing four guidelines for the development of VSLs.\60\
---------------------------------------------------------------------------

    \60\ North American Electric Reliability Corp., 123 FERC ] 
61,284, at P 20-35 (Violation Severity Level Order), order on reh'g 
and compliance, 125 FERC ] 61,212 (2008). The guidelines provide 
that VSL assignments should: (1) Not lower the current level of 
compliance; (2) ensure uniformity and consistency in the 
determination of penalties; (3) be consistent with the corresponding 
requirement; and (4) be based on a single violation.
---------------------------------------------------------------------------

    36. With respect to proposed Reliability Standard BAL-502-RFC-02, 
RFC assigned VRFs only to the two main Requirements and did not propose 
VRFs for any of the sub-Requirements.\61\ Requirement R1 of BAL-502-
RFC-02 is assigned a ``medium'' VRF and Requirement R2 is assigned a 
``lower'' VRF. Similarly, RFC assigned VSLs only to the main 
Requirements, R1 and R2, of proposed BAL-502-RFC-02, and not to any of 
the sub-Requirements. NERC notes that RFC's assignment of both VRFs and 
VSLs only to the main Requirements is consistent with NERC's August 10, 
2009 Informational Filing Regarding the Assignment of VRFs and 
VSLs.\62\
---------------------------------------------------------------------------

    \61\ 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 VRFs and VSLs 
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.'' As directed, on March 5, 2010, NERC submitted a 
comprehensive approach that is currently pending with the Commission 
in Docket No. RR08-4-005.
    \62\ NERC Petition at 24.
---------------------------------------------------------------------------

    37. On May 5, 2010, NERC incorporated by reference into Docket No. 
RR08-4-005,\63\ its August 10, 2009 information filing in which NERC 
proposes assigning VRFs and VSLs only to the main Requirements in each 
Reliability Standard, and not to the sub-Requirements. Because the VRFs 
and VSLs for both Requirements R1 and R2 of proposed Reliability 
Standard BAL-502-RFC-02 are affected by the NERC's pending petition, we 
propose to defer discussion on the proposed VRFs and VSLs assigned to 
BAL-502-RFC-02 until after we act on NERC's petition in Docket No. 
RR08-4-005.
---------------------------------------------------------------------------

    \63\ Docket No. RR08-4-005 comprises NERC's March 5, 2010 
Violation Severity Level Compliance Filing submitted in response to 
Order No. 722. See Order No. 722, 126 FERC ] 61,255 at P 45.
---------------------------------------------------------------------------

J. Summary

    38. In summary, proposed regional Reliability Standard BAL-502-RFC-
02 appears to be just, reasonable, not unduly discriminatory or 
preferential, and in the public interest. Accordingly, the Commission 
proposes to approve regional Reliability Standard BAL-502-RFC-02 as 
mandatory and enforceable and to accept the four related defined terms 
as terms applicable to the RFC region only. In addition, the Commission 
proposes to defer discussion on the proposed VRFs and VSLs, as 
described above. The Commission invites comments on these proposals.

IV. Information Collection Statement

    39. The Office of Management and Budget (OMB) regulations require 
approval of certain information collection requirements imposed by 
agency rules.\64\ 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. The Paperwork Reduction Act (PRA) \65\ requires each federal 
agency to seek and obtain OMB approval before undertaking a collection 
of information directed to ten or more persons or contained in a rule 
of general applicability.\66\
---------------------------------------------------------------------------

    \64\ 5 CFR 1320.8.
    \65\ 44 U.S.C. 3501-3520.
    \66\ OMB's regulations at 5 CFR 1320.3(c)(4)(i) require that 
``Any recordkeeping, reporting, or disclosure requirement contained 
in a rule of general applicability is deemed to involve ten or more 
persons.''
---------------------------------------------------------------------------

    40. The Commission is submitting these reporting and recordkeeping 
requirements to OMB for its review and approval under section 3507(d) 
of the PRA. Comments are solicited on the Commission's need for this 
information, whether the information will have practical utility, the 
accuracy of provided burden estimates, ways to enhance the quality, 
utility, and clarity of the information to be collected, and any 
suggested methods for minimizing the respondent's burden, including the 
use of automated information techniques.
    41. This Notice of Proposed Rulemaking (NOPR) proposes to approve 
one new regional Reliability Standard, BAL-502-RFC-02, that was 
developed by RFC, a Regional Entity, and submitted by NERC as the ERO. 
The proposed regional Reliability Standard requires planning 
coordinators within the RFC geographical footprint to analyze, assess 
and document resource adequacy, annually, and to document and post 
projected load and resource capability in each area and transmission-
constrained sub-area identified in the resource adequacy assessment. 
The proposed regional Reliability Standard, which applies to 
approximately four planning coordinators located in the eastern portion 
of the U.S., does not require planning coordinators to file information 
with the Commission. It does require planning coordinators to develop, 
document, publicly post, and retain certain information, subject to 
compliance monitoring by RFC. However, the Commission does not believe 
that approval of the RFC regional Reliability Standard will result in a 
substantive increase in reporting burdens because it implements the 
current practices in RFC. As RFC has represented, the affected RFC-
member planning coordinators have been subject to these requirements 
since August 2009 and would continue to be subject to them even if the 
Commission did not approve BAL-502-RFC-02 as a regional Reliability 
Standard. Thus, the Commission finds that the requirement to develop, 
document, and maintain information in the regional Reliability Standard 
is a current and ongoing requirement for RFC members and, therefore, 
the Commission's proposed action in this Notice of Proposed Rulemaking 
would not impose any additional burden on RFC-member planning 
coordinators. The Commission therefore concludes that this proposed 
rule will not substantively increase the reporting burden nor impose 
any additional information collection requirements. The proposed 
regional Reliability Standard is a new standard and was not included in 
the original standards submitted for review and approval by OMB. In 
addition, Commission approval of proposed regional Reliability Standard 
BAL-502-RFC-02 makes the standard mandatory and enforceable. Therefore, 
the Commission will submit this proposed rule to OMB for review and 
approval of the reporting requirements and propose a de minimis burden 
to reflect the prior implementation by RFC as part of its region's 
standard practices.
    42. The Commission does not foresee any impact on the reporting 
burden for small businesses.
    43. Based on currently available information and the fact that the 
burden is an existing part of the business process for registered 
planning coordinators in the RFC region, the Commission estimates that 
the increased Public Reporting Burden is de minimis as follows:

[[Page 66045]]

----------------------------------------------------------------------------------------------------------------
                                              Number of         Number of         Hours per       Total annual
   Proposed data collection FERC-725-H       respondents        responses        respondent           hours
----------------------------------------------------------------------------------------------------------------
  Registered planning coordinators \67\                  4                 1                10                40
   in the RFC region....................
                                         -----------------------------------------------------------------------
    Total...............................  ................  ................  ................                40
----------------------------------------------------------------------------------------------------------------

    Information Collection Costs: The Commission seeks comments on the 
costs to comply with these requirements.
---------------------------------------------------------------------------

    \67\ At this time, there are only four registered planning 
coordinators in the RFC region.
---------------------------------------------------------------------------

     Total annual costs = $2,651.41 ((40 hours/2080 hours/year) 
x $137,874/year).
     Title: (proposed) FERC-725-H, Regional Reliability 
Standard BAL-502-RFC-02 (Planning Resource Adequacy Analysis, 
Assessment and Documentation).
     Action: Proposed Collection of Information.
     OMB Control No: To Be Determined.
     Respondents: Registered planning coordinators in the RFC 
region.
     Frequency of Responses: On Occasion.
     Necessity of the Information: The proposed Regional 
Reliability Standard requires planning coordinators to document and 
maintain, for two years, their resource adequacy analyses and the 
projected load and resource capability subject to review by the 
Commission, NERC, and RFC to ensure compliance with the Reliability 
Standard.
     Internal Review: The Commission has reviewed the proposed 
regional Reliability Standard BAL-502-RFC-02 and believes it to be 
just, reasonable, not unduly discriminatory or preferential, and in the 
public interest. The Commission has assured itself, by means of 
internal review, that there is specific, objective support for the 
burden estimates associated with the information requirements.
    44. Interested persons may obtain information on the reporting 
requirements by contacting: Federal Energy Regulatory Commission, 888 
First Street, NE., Washington, DC 20426 [Attention: Ellen Brown, Office 
of the Executive Director, Phone: (202) 502-8663, fax: (202) 273-0873, 
e-mail: DataClearance@ferc.gov]. Comments on the requirements of this 
order may also be sent to the Office of Information and Regulatory 
Affairs, Office of Management and Budget, Washington, DC 20503 
[Attention: Desk Officer for the Federal Energy Regulatory Commission]. 
For security reasons, comments should be sent by e-mail to OMB at 
oira_submission@omb.eop.gov. Please reference FERC-725H and the docket 
number of this proposed rulemaking in your submission.

V. Environmental Analysis

    45. 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.\68\ 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.\69\ The actions proposed 
herein fall within this categorical exclusion.
---------------------------------------------------------------------------

    \68\ Regulations Implementing the National Environmental Policy 
Act of 1969, 52 FR 47897 (Dec. 17, 1987), FERC Stats. & Regs., 
Regulations Preambles 1986-1990 ] 30,783 (1987).
    \69\ 18 CFR 380.4(a)(2)(ii).
---------------------------------------------------------------------------

VI. Regulatory Flexibility Act Certification

    46. The Regulatory Flexibility Act of 1980 (RFA) \70\ generally 
requires a description and analysis of final rules that will have 
significant economic impact on a substantial number of small entities. 
The entities to which the requirements of this Rule would apply; i.e., 
planning coordinators within the RFC region, do not fall within the 
definition of small entities.\71\ Moreover, the proposed regional 
Reliability Standards reflect a continuation of existing resource 
planning assessment requirements for these planning coordinators and 
are ``new'' only with respect to the fact that once approved by the 
Commission, they would be subject to enforcement by either NERC or the 
Commission. Based on the foregoing, the Commission certifies that this 
Rule will not have a significant impact on a substantial number of 
small entities. Accordingly, no regulatory flexibility analysis is 
required.
---------------------------------------------------------------------------

    \70\ 5 U.S.C. 601-612.
    \71\ The RFA definition of ``small entity'' refers to the 
definition provided in the Small Business Act (SBA), which defines a 
``small business concern'' as a business that is independently owned 
and operated and that is not dominant in its field of operation. See 
15 U.S.C. 632. According to the SBA, a small electric utility is 
defined as one that has a total electric output of less than four 
million MWh in the preceding year.
---------------------------------------------------------------------------

VII. Comment Procedures

    47. The Commission invites interested persons to submit comments on 
the matters and issues proposed in this NOPR to be adopted, including 
any related matters or alternative proposals that commenters may wish 
to discuss. Comments are due December 27, 2010. Comments must refer to 
Docket No. RM10-10-000, and must include the commenter's name, the 
organization they represent, if applicable, and their address in their 
comments.
    48. The Commission encourages comments to be filed electronically 
via the eFiling link on the Commission's Web site at http://
www.ferc.gov. The Commission accepts most standard word processing 
formats. Documents created electronically using word processing 
software should 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.
    49. Commenters that are not able to file comments electronically 
must send an original copy of their comments to: \72\ Federal Energy 
Regulatory Commission, Secretary of the Commission, 888 First Street, 
NE., Washington, DC 20426.
---------------------------------------------------------------------------

    \72\ The number of copies to be filed is set forth in the 
Commission's ``Quick Reference Guide for Paper Submissions'' (as 
updated), available at http://www.ferc.gov/docs-filing/efiling.asp.
---------------------------------------------------------------------------

    50. 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.

VIII. Document Availability

    51. 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.

[[Page 66046]]

    52. 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.
    53. 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.

    By direction of the Commission.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2010-27132 Filed 10-26-10; 8:45 am]
BILLING CODE 6717-01-P