Document ID: FERC-2019-0474-0001
Agency: ferc
Document Type: Proposed Rule
Title: Critical Infrastructure Protection Reliability Standard CIP-012-1-Cyber Security-Communications between Control Centers
Posted Date: 2019-04-24T04:00Z

[Federal Register Volume 84, Number 79 (Wednesday, April 24, 2019)]
[Proposed Rules]
[Pages 17105-17112]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-08236]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 40

[Docket No. RM18-20-000]

Critical Infrastructure Protection Reliability Standard CIP-012-
1--Cyber Security--Communications Between Control Centers

AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Federal Energy Regulatory Commission (Commission) proposes 
to approve Reliability Standard CIP-012-1 (Cyber Security--
Communications between Control Centers). The North American Electric 
Reliability Corporation (NERC), the Commission-certified Electric 
Reliability Organization, submitted the proposed Reliability Standard 
for Commission approval in response to a Commission directive. In 
addition, the Commission proposes to direct that NERC develop certain 
modifications to Reliability Standard CIP-012-1 to require protections 
regarding the availability of communication links and data communicated 
between bulk electric system control centers and, further, to clarify 
the types of data that must be protected.

DATES: Comments are due June 24, 2019.

ADDRESSES: Comments, identified by docket number, may be filed in the 
following ways:
     Electronic Filing through http://www.ferc.gov. Documents 
created electronically using word processing software should be filed 
in native applications or print-to-PDF format and not in a scanned 
format.
     Mail/Hand Delivery: Those unable to file electronically 
may mail or hand-deliver comments to: Federal Energy Regulatory 
Commission, Secretary of the Commission, 888 First Street NE, 
Washington, DC 20426.
    Instructions: For detailed instructions on submitting comments and 
additional information on the rulemaking process, see the Comment 
Procedures Section of this document.

FOR FURTHER INFORMATION CONTACT:
    Vincent Le (Technical Information), Office of Electric Reliability, 
Federal Energy Regulatory Commission, 888 First Street NE, Washington, 
DC 20426, (202) 502-6204, [email protected].
    Kevin Ryan (Legal Information), Office of the General Counsel, 
Federal Energy Regulatory Commission, 888 First Street NE, Washington, 
DC 20426, (202) 502-6840, [email protected].

SUPPLEMENTARY INFORMATION:
    1. Pursuant to section 215(d)(2) of the Federal Power Act (FPA),\1\ 
the Commission proposes to approve Reliability Standard CIP-012-1 
(Cyber Security--Communications between Control Centers). The North 
American Electric Reliability Corporation (NERC), the Commission-
certified Electric Reliability Organization (ERO), submitted the 
proposed Reliability Standard for Commission approval in response to a 
Commission directive in Order No. 822.\2\ Specifically, pursuant to 
section 215(d)(5) of the FPA, the Commission directed that NERC develop 
modifications to require responsible entities to implement controls to 
protect, at a minimum, communications links and sensitive bulk electric 
system data communicated between bulk electric system Control Centers 
``in a manner that is appropriately tailored to address the risks posed 
to the bulk electric system by the assets being protected (i.e., high, 
medium, or low impact).'' \3\
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    \1\ 16 U.S.C. 824o(d)(2) (2012).
    \2\ Revised Critical Infrastructure Protection Reliability 
Standards, Order No. 822, 154 FERC ] 61,037, at P 53, order denying 
reh'g, Order No. 822-A, 156 FERC ] 61,052 (2016).
    \3\ 16 U.S.C. 824o(d)(5); Order No. 822, 154 FERC ] 61,037 at P 
53.
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    2. Proposed Reliability Standard CIP-012-1 is intended to augment 
the currently-effective Critical Infrastructure Protection (CIP) 
Reliability Standards to mitigate cybersecurity risks associated with 
communications between bulk electric system Control Centers.\4\ 
Specifically, proposed Reliability Standard CIP-012-1 supports 
situational awareness and reliable bulk electric system operations by 
requiring responsible entities to protect the confidentiality and 
integrity of Real-time Assessment and Real-time monitoring data 
transmitted between

[[Page 17106]]

bulk electric system Control Centers.\5\ Accordingly, the Commission 
proposes to approve proposed Reliability Standard CIP-012-1 based on a 
determination that the standard is largely responsive to the 
Commission's directive in Order No. 822 and improves the cybersecurity 
posture of applicable entities.
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    \4\ BES Cyber System is defined as ``[o]ne or more BES Cyber 
Assets logically grouped by a responsible entity to perform one or 
more reliability tasks for a functional entity.'' Glossary of Terms 
Used in NERC Reliability Standards (NERC Glossary), http://www.nerc.com/files/glossary_of_terms.pdf. The acronym BES refers to 
the bulk electric system.
    \5\ The NERC Glossary defines Real-time Assessment as ``An 
evaluation of system conditions using Real-time data to assess 
existing (pre-Contingency) and potential (post-Contingency) 
operating conditions. The assessment shall reflect applicable inputs 
including, but not limited to: Load, generation output levels, known 
Protection System and Special Protection System status or 
degradation, Transmission outages, generator outages, Interchange, 
Facility Ratings, and identified phase angle and equipment 
limitations. (Real-time Assessment may be provided through internal 
systems or through third-party services.)'' NERC Glossary of Terms 
Used in NERC Reliability Standards (July 3, 2018).
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    3. However, we are concerned that there still may be certain cyber 
security risks associated with the protection of communications links 
and sensitive bulk electric system data communicated between bulk 
electric system Control Centers that are not adequately addressed in 
NERC's proposal. First, proposed Reliability Standard CIP-012-1 does 
not require protections regarding the availability of communication 
links and data communicated between bulk electric system Control 
Centers as directed in Order No. 822.\6\ As discussed below, at this 
time, we are not persuaded by NERC's explanation that certain 
currently-effective CIP Reliability Standards address the issue of 
availability. Second, proposed Reliability Standard CIP-012-1 does not 
adequately identify the types of data covered by its requirements, due 
to, among other things, the fact that the term ``Real-time monitoring'' 
is not defined in the proposed Reliability Standard or the NERC 
Glossary. Clarification of the types of covered data is warranted.
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    \6\ Order No. 822, 154 FERC ] 61,037 at P 54.
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    4. To address these issues, pursuant to section 215(d)(5) of the 
FPA, the Commission proposes to direct that NERC develop modifications 
to the CIP Reliability Standards to: (1) Require protections regarding 
the availability of communication links and data communicated between 
bulk electric system Control Centers; and (2) clearly identify the 
types of data that must be protected.

I. Background

A. Section 215 and Mandatory Reliability Standards

    5. Section 215 of the FPA requires a Commission-certified ERO to 
develop mandatory and enforceable Reliability Standards, subject to 
Commission review and approval. Reliability Standards may be enforced 
by the ERO, subject to Commission oversight, or by the Commission 
independently.\7\ Pursuant to section 215 of the FPA, the Commission 
established a process to select and certify an ERO,\8\ and subsequently 
certified NERC.\9\
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    \7\ 16 U.S.C. 824o(e).
    \8\ Rules Concerning Certification of the Electric Reliability 
Organization; and Procedures for the Establishment, Approval, and 
Enforcement of Electric Reliability Standards, Order No. 672, 114 
FERC ] 61,104, order on reh'g, Order No. 672-A, 114 FERC ] 61,328 
(2006).
    \9\ North American Electric Reliability Corp., 116 FERC ] 
61,062, 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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B. Order No. 822

    6. In Order No. 822, the Commission approved seven modified CIP 
Reliability Standards and directed NERC to develop additional 
modifications to the CIP Reliability Standards.\10\ Specifically, the 
Commission directed NERC to, among other things, develop modifications 
to the CIP Reliability Standards to require responsible entities to 
implement controls to protect, at a minimum, communications links and 
sensitive bulk electric system data communicated between bulk electric 
system Control Centers ``in a manner that is appropriately tailored to 
address the risks posed to the bulk electric system by the assets being 
protected (i.e., high, medium, or low impact).'' \11\ The Commission 
observed that NERC, as well as other commenters in that proceeding, 
``recognize that inter-Control Center communications play a critical 
role in maintaining bulk electric system reliability by . . . helping 
to maintain situational awareness and support reliable operations 
through timely and accurate communication between Control Centers.'' 
\12\
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    \10\ Order No. 822, 154 FERC ] 61,037 at PP 1, 3.
    \11\ Id. P 53.
    \12\ Id. P 54 (citing NERC Comments at 20).
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    7. The Commission explained that Control Centers associated with 
responsible entities, including reliability coordinators, balancing 
authorities, and transmission operators, must be capable of receiving 
and storing a variety of bulk electric system data from their 
interconnected entities in order to adequately perform their 
reliability functions. The Commission, therefore, determined that 
``additional measures to protect both the integrity and availability of 
sensitive bulk electric system data are warranted.'' \13\ The 
Commission also recognized that the data managed by responsible 
entities has different attributes that may require different 
information protection controls, and the Commission stated that NERC 
should consider the different attributes of bulk electric system data 
as it assesses appropriate information protection controls. The 
Commission concluded that NERC ``should have flexibility in the manner 
in which it addresses the Commission's directive.'' \14\
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    \13\ Id. P 54.
    \14\ Id. P 55.
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    8. In Order No. 822, the Commission found to be reasonable the 
following principles outlined in NERC's comments in that Commission 
proceeding regarding protections for communication links and sensitive 
bulk electric system data communicated between bulk electric system 
Control Centers:

    (1) should not have an adverse effect on reliability, including 
the recognition of instances where the introduction of latency could 
have negative results; (2) should account for the risk levels of 
assets and information being protected, and require protections that 
are commensurate with the risks presented; and (3) should be 
results-based in order to provide flexibility to account for the 
range of technologies and entities involved in bulk electric system 
communications.\15\
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    \15\ Id.

In addition, the Commission cautioned that ``not all communication 
network components and data pose the same risk to bulk electric system 
reliability and may not require the same level of protection.'' \16\ 
Therefore, the Commission determined that NERC should develop controls 
that reflect the risk being addressed in a reasonable manner.
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    \16\ Id. P 56.
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C. NERC Petition and Proposed Reliability Standard CIP-012-1

    9. On September 18, 2018, NERC submitted for Commission approval 
proposed Reliability Standard CIP-012-1 and the associated violation 
risk factors and violation severity levels, implementation plan, and 
effective date.\17\ NERC states that the purpose of the proposed 
Reliability Standard is to help maintain situational awareness and 
reliable bulk electric system operations by protecting the 
confidentiality and integrity of Real-time Assessment and Real-time 
monitoring data transmitted between Control Centers.
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    \17\ Proposed Reliability Standard CIP-012-1 is not attached to 
this notice of proposed rulemaking (NOPR). The proposed Reliability 
Standards are available on the Commission's eLibrary document 
retrieval system in Docket No. RM18-20-000 and on the NERC website, 
www.nerc.com.

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[[Page 17107]]

    10. NERC explains that, although the Commission directed 
modifications to Reliability Standard CIP-006-6, the standard drafting 
team determined to address the Commission's communications directive by 
developing a new Reliability Standard. According to NERC, the 
differences in the scope and applicability between the existing 
requirements of Reliability Standard CIP-006-1 and the Commission's 
directive necessitated the development of a new Reliability Standard. 
Specifically, NERC notes that while Reliability Standard CIP-006-6, 
Requirement R1, Part 1.10 mandates protections for nonprogrammable 
communication components outside a Physical Security Perimeter (PSP) 
but inside the same Electronic Security Perimeter (ESP) for certain 
Cyber Assets, proposed Reliability Standard CIP-012-1 ``requires 
protections for communications between Control Centers that transmit 
certain data regardless of the location of Cyber Assets inside or 
outside a PSP or ESP.'' \18\ In addition, NERC explains that unlike 
Reliability Standard CIP-006-6, which applies to high and medium impact 
BES Cyber Assets at Control Centers, proposed Reliability Standard CIP-
012-1 applies to assets associated with communications between certain 
Control Centers.
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    \18\ NERC Petition at 9.
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    11. NERC states that proposed Reliability Standard CIP-012-1 
``requires Responsible Entities to develop and implement a plan to 
address the risks posed by unauthorized disclosure (confidentiality) 
and unauthorized modification (integrity) of Real-time Assessment and 
Real-time monitoring data while being transmitted between applicable 
Control Centers.'' \19\ According to NERC, the required plan must 
include the following: (1) Identification of security protections; (2) 
identification of where the protections are applied; and (3) 
identification of the responsibilities of each entity in case a Control 
Center is owned or operated by different responsible entities.\20\
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    \19\ Id. at 10.
    \20\ Id. at 3.
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    12. NERC posits that, consistent with the Commission's directive in 
Order No. 822, the risks posed by different types of BES Control 
Centers and the associated data communicated between the Control 
Centers were considered by the standard drafting team to determine its 
appropriate scope and applicability.\21\ With regard to functional 
entities and facilities, NERC states that proposed Reliability Standard 
CIP-012-1 applies to balancing authorities, generator operators, 
reliability coordinators, transmission operators and transmission 
owners that own or operate a Control Center. NERC explains that 
proposed Reliability Standard CIP-012-1 applies to all Control Centers, 
with one exemption discussed below, ``regardless of the impact level of 
BES Cyber Systems located at or associated with those control 
centers.'' \22\ In that regard, NERC explains that the standard 
drafting team determined that the sensitivity of data communicated 
between Control Centers ``is not necessarily dependent on the impact 
level of the BES Cyber Systems located at or associated with the 
Control Centers.'' \23\ NERC states that the standard drafting team, 
instead, focused on the types of Real-time data a Control Center will 
communicate and whether the compromise of that data would pose a high 
risk to bulk electric system reliability.
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    \21\ Id.
    \22\ Id. at 10.
    \23\ Id.
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    13. As noted above, the types of data within the scope of proposed 
Reliability Standard CIP-012-1 consists of Real-time Assessment and 
Real-time monitoring data exchanged between Control Centers. NERC 
states that it is critical that this information is accurate since 
responsible entities operate and monitor the bulk electric system based 
on this Real-time information. However, NERC points out that proposed 
Reliability Standard CIP-012-1 exempts Control Centers ``that transmit[ 
] to another Control Center Real-time Assessment or Real-time 
monitoring data pertaining only to the generation resource of 
transmission station or substation co-located with the transmitting 
Control Center.'' \24\ NERC explains that proposed Reliability Standard 
CIP-012-1 ``excludes other data typically transferred between Control 
Centers, such as Operational Planning Analysis data, that is not used 
by the Reliability Coordinator, Balancing Authority, and Transmission 
Operator in Real-time.'' \25\ According to NERC, while Operational 
Planning Analysis data provides information for next-day operations, 
``entities adjust their operating actions during the current day based 
on the data from Real-time Assessments and Real-time monitoring.'' \26\ 
NERC contends that if there is a risk that Operational Planning 
Analysis data has been compromised, the responsible entity has the 
opportunity to verify the data prior to any impact on Real-time 
operations. Therefore, NERC concludes that while ``an Operational 
Planning Analysis factors into how an entity operates, there is less of 
a risk that an entity would act on compromised data from an Operational 
Planning Analysis given it will base its operating actions on Real-time 
inputs.'' \27\
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    \24\ Id. at 11.
    \25\ Id. at 12.
    \26\ Id.
    \27\ Id. at 13.
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    14. NERC also indicates that data at rest and oral communications 
fall outside the scope of proposed Reliability Standard CIP-012-1. 
Regarding data at rest, NERC states that the standard drafting team 
determined that since data at rest resides within BES Cyber Systems, it 
is already protected by the controls mandated by Reliability Standards 
CIP-003-6 through CIP-011-2. According to NERC, oral communications are 
out of scope of proposed Reliability Standard CIP-012-1 ``because 
operators have the ability to terminate the call and initiate a new one 
via trusted means if they suspect a problem with, or compromise of, the 
communication channel.'' \28\ NERC notes that Reliability Standard COM-
001-3 requires reliability coordinators, balancing authorities, and 
transmission operators to have alternative interpersonal communication 
capability, which could be used if there is a suspected compromise of 
oral communication on one channel.
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    \28\ Id. at 14.
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II. Discussion

    15. Pursuant to section 215(d)(2) of the FPA, the Commission 
proposes to approve proposed Reliability Standard CIP-012-1 as just, 
reasonable, not unduly discriminatory or preferential, and in the 
public interest. The proposed Reliability Standard will enhance 
existing protections for bulk electric system reliability by augmenting 
the currently-effective CIP Reliability Standards to mitigate 
cybersecurity risks associated with communications between bulk 
electric system Control Centers. Specifically, consistent with the 
Commission's directive in Order No. 822, proposed Reliability Standard 
CIP-012-1 supports situational awareness and reliable bulk electric 
system operations by requiring responsible entities to protect the 
confidentiality and integrity of Real-time Assessment and Real-time 
monitoring data transmitted between bulk electric system Control 
Centers.
    16. While the Commission proposes to approve Reliability Standard 
CIP-012-1, certain cyber security risks associated with communications 
between bulk electric system Control

[[Page 17108]]

Centers may not be fully addressed even with the implementation of the 
proposed Reliability Standard. As discussed below, the Commission is 
concerned that a significant cyber security risk associated with the 
protection of communications links and sensitive bulk electric system 
data communicated between bulk electric system Control Centers may 
persist because: (1) The CIP Reliability Standards do not address the 
availability of communication links and data communicated between bulk 
electric system Control Centers; and (2) proposed Reliability Standard 
CIP-012-1 does not adequately identify the types of data covered by its 
Requirements, due to, among other things, the fact that the term 
``Real-time monitoring'' is not defined.
    17. To address these gaps, the Commission seeks comment on 
proposals to direct NERC, pursuant to section 215(d)(5) of the FPA, to 
develop modifications to the CIP Reliability Standards to: (1) Require 
protections regarding the availability of communication links and data 
communicated between bulk electric system Control Centers; and (2) 
clearly identify the types of data that must be protected.
    18. Below, we discuss the following issues: (A) Availability of 
bulk electric system communication links and data; and (B) scope of 
bulk electric system data that must be protected.

A. Availability of Bulk Electric System Communication Links and Data 
Order No. 822

    19. In Order No. 822, the Commission directed that NERC ``should 
identify the scope of sensitive bulk electric system data that must be 
protected and specify how the confidentiality, integrity, and 
availability of each type of bulk electric system data should be 
protected while it is being transmitted or at rest.'' \29\ In addition, 
the Commission clarified that ``the directed modification should 
encompass communication links and data for intra-Control Center and 
inter-Control Center communications.'' \30\
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    \29\ Order No. 822, 154 FERC ] 61,037 at P 56.
    \30\ Id. P 58.
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    20. Specifically, the Commission explained that bulk electric 
system Control Centers must be capable of exchanging and storing 
sensitive bulk electric system data from interconnected entities in 
order for responsible entities to adequately perform their reliability 
functions. The Commission determined ``that additional measures to 
protect both the integrity and availability of sensitive bulk electric 
system data are warranted.'' \31\ The Commission explained that 
protecting the availability of sensitive bulk electric system data 
involves ensuring that the data required for bulk electric system 
operations is available when needed. The Commission responded to 
concerns that the risks posed by bulk electric system communication 
networks do not justify the cost of implementing controls by explaining 
that communications between Control Centers are fundamental to reliable 
bulk electric system operations. The Commission, however, also 
recognized that ``not all communication network components and data 
pose the same risk to bulk electric system reliability and may not 
require the same level of protection.'' \32\ The Commission therefore 
determined that it expected NERC to develop controls that reflect the 
associated risk and that can be implemented in a reasonable manner.
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    \31\ Id. P 54 (emphasis added).
    \32\ Id. P 56.
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NERC Petition

    21. NERC states that proposed Reliability Standard CIP-012-1, 
Requirement R1 mandates that:

each Responsible Entity develop a plan to mitigate the risks posed 
by unauthorized disclosure and unauthorized modification of Real-
time Assessment and Real-time monitoring data while being 
transmitted between and applicable Control Centers.\33\
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    \33\ Petition at 15-16.

NERC acknowledges that Order No. 822 directed that ``NERC should 
develop measures to protect the confidentiality, integrity, and 
availability of sensitive [bulk electric system] data.'' \34\ NERC 
states, however, that while proposed Reliability Standard CIP-012-1 
requires protections for the confidentiality (i.e., unauthorized 
disclosure) and integrity (i.e., unauthorized modification) of Real-
time Assessment and Real-time monitoring data, the availability of that 
data is addressed in currently-effective Reliability Standards.
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    \34\ Id. at 17.
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    22. Specifically, NERC maintains that Reliability Standard IRO-002-
5 ``requires redundant and diversely routed data exchange 
infrastructure within the Reliability Coordinator's primary Control 
Center in order to exchange Real-time data used in Real-time monitoring 
and Real-time Assessments with Balancing Authorities, Transmission 
Operators, and other entities the Reliability Coordinator deems 
necessary.'' \35\ Similarly, NERC states that Reliability Standard TOP-
001-4 ``requires Balancing Authorities and Transmission Operators to 
have redundant and diversely routed data exchange infrastructure to 
exchange Real-time data.'' \36\ According to NERC, the ``redundancy of 
data exchange infrastructure helps to ensure the availability of 
critical Real-time data for Control Centers.'' \37\ Further, NERC notes 
that Reliability Standards IRO-010-2 and TOP-003-3 require reliability 
coordinators, transmission operators, and balancing authorities to use 
a mutually agreeable security protocol for exchange of Real-time data. 
NERC contends that, by agreeing on security protocols, entities 
communicate directly with the appropriate entities rather than having 
to translate different protocols, which helps to ensure the 
availability of Real-time data.
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    \35\ Id. at 18.
    \36\ Id.
    \37\ Id.
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Discussion

    23. We are not persuaded by the explanation in NERC's petition that 
currently-effective CIP Reliability Standard requirements address the 
availability directive in Order No. 822. Sensitive bulk electric system 
data generally includes monitoring, operational, and system planning 
data. Ensuring timely and reliable access to and use of this 
information is essential to the reliable operation of the bulk electric 
system. As the Commission noted in Order No. 822, bulk electric system 
Control Centers ``must be capable of receiving and storing a variety of 
sensitive bulk electric system data from interconnected entities.'' 
\38\ In particular, the Commission stated that additional protections 
to address the availability of sensitive bulk electric system data are 
warranted.\39\
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    \38\ Order No. 822, 154 FERC ] 61,037 at P 54.
    \39\ Id.
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    24. We are not persuaded that the currently-effective Reliability 
Standards cited in NERC's petition require responsible entities to 
protect the availability of sensitive bulk electric system data in a 
manner consistent with the directives in Order No. 822. For instance, 
Reliability Standards IRO-002-5 and TOP-001-4 require responsible 
entities to have redundant and diversely routed data exchange 
infrastructure within the Control Center environment, but do not 
pertain to communications between individual Control Centers, which was 
the subject of the Commission's directive in Order No. 822. Similarly, 
Reliability Standards IRO-010-2 and TOP-003-3 require responsible 
entities to have mutually agreeable security protocols for

[[Page 17109]]

exchange of Real-time data, which may have the effect of contributing 
to greater availability; however, these requirements do not create an 
obligation, as directed in Order No. 822, to protect the availability 
of those communication capabilities and associated data by applying 
appropriate security controls. Creating an obligation to protect 
availability, while affording flexibility in terms of what data is 
protected and how, is distinct from relying on currently-effective 
Reliability Standards whose effect may be to improve availability.
    25. Bonneville Power Administration (BPA) and CenterPoint Energy 
Houston Electric addressed this distinction during the standards 
development process when they responded to the standard drafting team's 
assertion that the availability directive is adequately addressed by 
currently-effective CIP Reliability Standards. BPA explained that 
``[w]hile the requirements of TOP-001-4 and IRO-002-5 (redundant and 
diverse routing of data) can be used to achieve increased Availability, 
it can also be achieved through other equally effective methods . . . 
[and] [t]herefore, `availability' is not adequately addressed by TOP-
001-4 and IRO-002-5 and limits entities' options to address 
availability by other methods more appropriate to their systems.'' \40\ 
CenterPoint stated that, ``TOP-001-4 and IRO-002-5 do not ensure 
availability or communication of data between inter-entity and intra-
entity Control Centers, but only the redundancy of infrastructure 
internal to the requesting entity's primary Control Center.'' \41\
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    \40\ NERC Petition at page 273 of pdf.
    \41\ Id. at page 274 of pdf.
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    26. Not addressing the availability of covered communication links 
and data could lead to unreliable operations resulting from the 
inability to communicate data between Control Centers. While NERC 
contends that currently-effective CIP Reliability Standards adequately 
protect the availability of sensitive bulk electric system data, there 
is no obligation on responsible entities to affirmatively protect the 
availability of such data. Moreover, while the Commission in Order No. 
822 allowed NERC flexibility in what data is protected and how, NERC 
has not addressed the directive to protect the availability of 
sensitive bulk electric system data.
    27. Accordingly, pursuant to section 215(d)(5) of the FPA, the 
Commission proposes to direct that NERC develop modifications to the 
CIP Reliability Standards to require protections regarding the 
availability of communication links and data communicated between bulk 
electric system Control Centers. We seek comment on this proposal.

B. Scope of Bulk Electric System Data That Must Be Protected Order No. 
822

    28. In Order No. 822, the Commission stated that NERC ``should 
identify the scope of sensitive bulk electric system data that must be 
protected and specify how the confidentiality, integrity, and 
availability of each type of bulk electric system data should be 
protected while it is being transmitted or at rest.'' \42\ In addition, 
the Commission clarified that ``the directed modification should 
encompass communication links and data for intra-Control Center and 
inter-Control Center communications.'' \43\
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    \42\ Order No. 822, 154 FERC ] 61,037 at P 56.
    \43\ Id. P 58.
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NERC Petition

    29. NERC states that proposed Reliability Standard CIP-012-1 
applies to Real-time Assessment and Real-time monitoring data due to 
the critical nature of the information. NERC explains that:

Reliability Coordinators and Transmission Operators must perform 
Real-time Assessments every 30 minutes to assess the conditions on 
the system and determine whether there are any actual or potential 
exceedances of System Operating Limits or Interconnection 
Reliability Operating Limits.\44\
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    \44\ NERC Petition at 12.

In addition, NERC states that reliability coordinators, balancing 
authorities, and transmission operators must perform Real-time 
monitoring. NERC contends that since responsible entities ``operate and 
monitor the [bulk electric system] according to this Real-time 
information, it is of critical importance that it is accurate.'' \45\
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    \45\ Id.
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Discussion

    30. Proposed Reliability Standard CIP-012-1 requires the protection 
of Real-time Assessment and Real-time monitoring data. While Real-time 
Assessment is broadly defined by NERC, Real-time monitoring data is not 
defined. Moreover, the proposed Reliability Standard does not 
specifically indicate the types of data to be protected. We are 
concerned that without further clarity, Reliability Standard CIP-012-1 
may be implemented and enforced in an inconsistent manner.
    31. In the Technical Rationale document appended to NERC's 
petition, NERC explained in more detail (relative to the language of 
the proposed Reliability Standard's requirements) what data should be 
protected under proposed Reliability Standard CIP-012-1:

The SDT recognized the FERC reference to additional Reliability 
Standards and the responsibilities to protect the applicable data in 
accordance with NERC Reliability Standards TOP-003 and IRO-010. The 
SDT used these references to drive the identification of sensitive 
BES data and chose to base the CIP-012-1 requirements on the Real-
time data specification elements in these standards. This approach 
provides consistent scoping of identified data, and does not require 
each entity to devise its own list or inventory of this data. Many 
entities are required to provide this data under agreements executed 
with their [reliability coordinator (RC)], [balancing authority 
(BA)] or [transmission operator (TOP)]. Data requiring protection in 
CIP-012-1 consists of a subset of data that is identified by the RC, 
BA, and TOP in the TOP-003 and IRO-010 data specification standards, 
limited to Real-time Assessment data and Real-time monitoring 
data.\46\
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    \46\ NERC Petition, Exhibit F (Technical Rationale) at 1-2; see 
also Exhibit E (Draft Implementation Guidance) at 5 (providing 
similar context as to what data should be protected).

The references to Reliability Standards TOP-003 and IRO-010 in the 
Technical Rationale document are not found in proposed Reliability 
Standard CIP-012-1. Instead Requirement R1 of proposed Reliability 
Standard CIP-012-1 only uses the terms ``Real-time Assessment and Real-
time monitoring data.'' In addition, as the Technical Rational 
indicates at the outset: ``This Technical Rationale and Justification 
for CIP-012-1 is not a Reliability Standard and should not be 
considered mandatory and enforceable.'' \47\
---------------------------------------------------------------------------

    \47\ NERC Petition, Exhibit F at iv; see also Exhibit E at 3 
(indicating that the draft Implementation Guidance document only 
provides examples in achieving compliance).
---------------------------------------------------------------------------

    32. Not clearly defining the types of data that must be protected 
under the proposed Reliability Standard could result in uneven 
compliance and enforcement. The term ``Real-time Assessment'' is 
broadly defined in the NERC Glossary of Terms, and the term ``Real-time 
monitoring'' is not defined at all. These terms, alone, may not be 
understood or enforced in a consistent manner. This concern arose 
during the standard drafting process in comments regarding an earlier 
version of the proposed Reliability Standard, which was later 
modified.\48\ Still relevant,

[[Page 17110]]

however, are concerns raised regarding the potential ambiguities 
associated with enforcement of the scope of data that must be 
protected. In particular, while NERC identifies Reliability Standards 
IRO-002-5, Requirements R5 and R6, and TOP-001-4, Requirements R10 and 
R11 in discussing the parameters of Real-time monitoring data, the 
information outlined in the identified requirements is not included in 
the language of proposed Reliability Standard CIP-012-1 itself and, 
therefore, implementation and compliance concerns may arise.\49\
---------------------------------------------------------------------------

    \48\ An early version of Requirement R1 of proposed Reliability 
Standard CIP-012-1 identified the scope of the data to be protected 
as ``data used for Operational Planning Analysis, Real-time 
Assessments, and Real-time monitoring.''
    \49\ See NERC Petition at page 505 of pdf.
---------------------------------------------------------------------------

    33. The compliance obligations imposed under proposed Reliability 
Standard CIP-012-1 should be clear in order for responsible entities to 
effectively and reasonably implement the required protections. The lack 
of clarity regarding the scope of Real-time monitoring data is 
inconsistent with principles outlined by the Commission in Order No. 
672.\50\ In particular, the lack of clarity may result in: (1) A 
failure to establish a clear and unambiguous requirement regarding the 
protection of Real-time monitoring data; \51\ and (2) a failure to 
identify clear and objective criterion to facilitate consistent and 
non-preferential enforcement since responsible entities will not have a 
clear understanding of the Real-time monitoring data to be 
protected.\52\ Since the controls required under Reliability Standard 
CIP-012-1 are plan-based, the scope of data to be protected should be 
clear and unambiguous so that responsible entities will accurately 
identify vulnerabilities or risks requiring mitigation.
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    \50\ Order No. 672, 114 FERC ] 61,104, order on reh'g, Order No. 
672-A, 114 FERC ] 61,328.
    \51\ Id. PP 322, 325.
    \52\ Id. P 327.
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    34. Therefore, pursuant to section 215(d)(5) of the FPA, the 
Commission proposes to direct that NERC develop modifications to the 
CIP Reliability Standards to clearly identify the types of data that 
must be protected. We seek comment on this proposal. In particular, we 
seek comment on the specific information covered by the term ``Real-
time monitoring'' and whether a NERC Glossary definition would assist 
with implementation and compliance.

III. Information Collection Statement

    35. The FERC-725B information collection requirements contained in 
this notice of proposed rulemaking are subject to review by the Office 
of Management and Budget (OMB) under section 3507(d) of the Paperwork 
Reduction Act of 1995.\53\ OMB's regulations require approval of 
certain information collection requirements imposed by agency 
rules.\54\ Upon approval of a collection of information, OMB will 
assign an OMB control number and expiration date. Respondents subject 
to the filing requirements of this 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 
Commission solicits comments on the Commission's need for this 
information, whether the information will have practical utility, the 
accuracy of the burden estimates, ways to enhance the quality, utility, 
and clarity of the information to be collected or retained, and any 
suggested methods for minimizing respondents' burden, including the use 
of automated information techniques.
---------------------------------------------------------------------------

    \53\ 44 U.S.C. 3507(d) (2012).
    \54\ 5 CFR 1320.11.
---------------------------------------------------------------------------

    36. The Commission bases its paperwork burden estimates on the 
changes in paperwork burden presented by the newly proposed Reliability 
Standard CIP-012-1.
    37. The NERC Compliance Registry, as of December 2017, identifies 
approximately 1,250 unique U.S. entities that are subject to mandatory 
compliance with Reliability Standards. Of this total, we estimate that 
714 entities will face an increased paperwork burden under proposed 
Reliability Standard CIP-012-1. Based on these assumptions, we estimate 
the following reporting burden:
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    \55\ We consider the filing of an application to be a 
``response.''
    \56\ The loaded hourly wage figure (includes benefits) is based 
on the average of the occupational categories for 2017 found on the 
Bureau of Labor Statistics website (http://www.bls.gov/oes/current/naics2_22.htm):
    Information Security Analysts (Occupation Code: 15-1122): 
$42.84.
    Computer and Mathematical (Occupation Code: 15-0000): $44.02.
    Legal (Occupation Code: 23-0000): $143.68.
    Computer and Information Systems Managers (Occupation Code: 11-
3021): $96.51.
    These various occupational categories' wage figures are averaged 
and weighted equally as follows: ($42.84/hour + $44.02/hour + 
$143.68/hour + $96.51/hour) / 4 = $81.76/hour. The resulting wage 
figure is rounded to $82.00/hour for use in calculating wage figures 
in the NOPR in Docket No. RM18-20-000.
    \57\ This is a one-time reporting requirement.

                          Annual Changes Proposed by the NOPR in Docket No. RM18-20-000
----------------------------------------------------------------------------------------------------------------
                                                                                                   Total annual
                                  Number of       Number of     Total number    Average burden    burden hours &
                                 respondents   responses \55\   of responses    hrs. & cost per    total annual
                                               per respondent                    response \56\         cost
                                          (1)             (2)     (1) x (2) =  (4).............  (3) x (4) = 5
                                                                          (3)
----------------------------------------------------------------------------------------------------------------
Implementation of Documented              714               1             714  128 hrs.;         91,392
 Plan(s) (Requirement R1)                                                       $10,496.          hrs.;$7,494,14
 \57\.                                                                                            4.
Document Identification of                714               1             714  40 hrs.; $3,280.  28,560 hrs.;
 Security Protection                                                                              $2,341,920.
 (Requirement R1.1) \57\.
Identification of Security                714               1             714  20 hrs.; $1,640.  14,280 hrs.;
 Protection Application (if                                                                       $1,170,960.
 owned by same Responsible
 Entity) (Requirement R1.2)
 \57\.
Identification of Security                714               1             714  160 hrs.;         14,240 hrs.;
 Protection Application (if                                                     $13,120.          $9,367,680.
 not owned by same
 Responsible Entity)
 (Requirement R1.3) \57\.
Maintaining Compliance                    714               1             714  83 hrs.; $6,806.  59,262 hrs.;
 (ongoing).                                                                                       $4,859,484.
    Total (one-time).........  ..............  ..............           2,856  ................  148,472 hrs.;
                                                                                                  $12,174,704.
    Total (ongoing)..........  ..............  ..............             714  ................  59,262 hrs.;
                                                                                                  $4,859,484.
                              ----------------------------------------------------------------------------------
        TOTAL................  ..............  ..............           3,570  ................  207,734 hrs.;
                                                                                                  $17,034,188.
----------------------------------------------------------------------------------------------------------------

[[Page 17111]]

    38. The one-time burden for the FERC-725B information collection 
will be averaged over three years:

 148,472 hours / 3 = 49,491 hours/year over three years
 The number of one-time responses for the FERC-725B information 
collection is also averaged over three years: 2,856 responses / 3 = 952 
responses/year

    39. The responses and burden for one-time and ongoing burden for 
Years 1-3 will total respectively as follows:

 Year 1: 1,666 responses [952 responses (one-time) + 714 
responses (ongoing)]; 108,753 hours [49,491 hours (one-time) + 59,262 
hours (ongoing)]
 Year 2: 1,666 responses [952 responses (one-time) + 714 
responses (ongoing)]; 108,753 hours [49,491 hours (one-time) + 59,262 
hours (ongoing)]
 Year 3: 1,666 responses [952 responses (one-time) + 714 
responses (ongoing)]; 108,753 hours [49,491 hours (one-time) + 59,262 
hours (ongoing)]

    40. Title: Mandatory Reliability Standards for Critical 
Infrastructure Protection [CIP] Reliability Standards.
    Action: Proposed revision to FERC-725B information collection.
    OMB Control No.: 1902-0248.
    Respondents: Businesses or other for-profit institutions; not-for-
profit institutions.
    Frequency of Responses: On occasion.
    Necessity of the Information: This notice of proposed rulemaking 
proposes to approve the requested modifications to Reliability 
Standards pertaining to critical infrastructure protection. As 
discussed above, the Commission proposes to approve NERC's proposed 
Reliability Standard CIP-012-1 pursuant to section 215(d)(2) of the FPA 
because they improve upon the currently-effective suite of cyber 
security Reliability Standards.
    Internal Review: The Commission has reviewed the proposed 
Reliability Standard and made a determination that its action is 
necessary to implement section 215 of the FPA.
    41. Interested persons may obtain information on the reporting 
requirements by contacting the following: Federal Energy Regulatory 
Commission, 888 First Street NE, Washington, DC 20426 [Attention: Ellen 
Brown, Office of the Executive Director, email: [email protected], 
phone: (202) 502-8663, fax: (202) 273-0873].
    42. For submitting comments concerning the collection(s) of 
information and the associated burden estimate(s), please send your 
comments to the Commission, and to the Office of Management and Budget, 
Office of Information and Regulatory Affairs, 725 17th Street NW, 
Washington, DC 20503, [Attention: Desk Officer for the Federal Energy 
Regulatory Commission, phone: (202) 395-4638, fax: (202) 395-7285]. For 
security reasons, comments to OMB should be submitted by email to: 
[email protected]. Comments submitted to OMB should include 
Docket Number RM18-20-000 and FERC-725B (OMB Control No. 1902-0248).

IV. Environmental Analysis

    43. 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.\58\ 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.\59\ The actions proposed 
herein fall within this categorical exclusion in the Commission's 
regulations.
---------------------------------------------------------------------------

    \58\ Regulations Implementing the National Environmental Policy 
Act of 1969, Order No. 486, FERC Stats. & Regs. ] 30,783 (1987) 
(cross-referenced at 41 FERC ] 61,284).
    \59\ 18 CFR 380.4(a)(2)(ii).
---------------------------------------------------------------------------

V. Regulatory Flexibility Act Analysis

    44. The Regulatory Flexibility Act of 1980 (RFA) generally requires 
a description and analysis of proposed rules that will have significant 
economic impact on a substantial number of small entities.\60\ The 
Small Business Administration's (SBA) Office of Size Standards develops 
the numerical definition of a small business.\61\ The SBA revised its 
size standard for electric utilities (effective January 22, 2014) to a 
standard based on the number of employees, including affiliates (from 
the prior standard based on megawatt hour sales).\62\
---------------------------------------------------------------------------

    \60\ 5 U.S.C. 601-12 (2012).
    \61\ 13 CFR 121.101.
    \62\ 13 CFR 121.201, Subsection 221.
---------------------------------------------------------------------------

    45. Proposed Reliability Standard CIP-012-1 is expected to impose 
an additional burden on 714 entities \63\ (reliability coordinators, 
generator operators, generator owners, interchange coordinators or 
authorities, transmission operators, balancing authorities, and 
transmission owners).
---------------------------------------------------------------------------

    \63\ Public utilities may fall under one of several different 
categories, each with a size threshold based on the company's number 
of employees, including affiliates, the parent company, and 
subsidiaries. For the analysis in this NOPR, we are using a 500 
employee threshold due to each affected entity falling within the 
role of Electric Bulk Power Transmission and Control (NAISC Code: 
221121).
---------------------------------------------------------------------------

    46. Of the 714 affected entities discussed above, we estimate that 
approximately 82% percent of the affected entities are small entities. 
We estimate that each of the 585 small entities to whom the proposed 
modifications to Reliability Standard CIP-012-1 apply will incur one-
time costs of approximately $17,051 per entity to implement the 
proposed Reliability Standards, as well as the ongoing paperwork burden 
reflected in the Information Collection Statement (approximately $6,806 
per year per entity). We do not consider the estimated costs for these 
585 small entities to be a significant economic impact. Accordingly, we 
propose to certify that proposed Reliability Standard CIP-012-1 will 
not have a significant economic impact on a substantial number of small 
entities.

VI. Comment Procedures

    47. The Commission invites interested persons to submit comments on 
the matters and issues proposed in this notice to be adopted, including 
any related matters or alternative proposals that commenters may wish 
to discuss. Comments are due June 24, 2019. Comments must refer to 
Docket No. RM18-20-000, and must include the commenter's name, the 
organization they represent, if applicable, and address.
    48. The Commission encourages comments to be filed electronically 
via the eFiling link on the Commission's website at http://www.ferc.gov. The Commission accepts most standard word processing 
formats. Documents created electronically using word processing 
software should be filed in

[[Page 17112]]

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 of their comments to: Federal Energy Regulatory 
Commission, Secretary of the Commission, 888 First Street NE, 
Washington, DC 20426.
    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.

VII. 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 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 5:00 p.m. Eastern time) at 888 First Street NE, Room 2A, 
Washington, DC 20426.
    52. 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 of this document, excluding the last three digits, in 
the docket number field.
    53. User assistance is available for eLibrary and the Commission's 
website during normal business hours from the Commission's Online 
Support at (202) 502-6652 (toll free at 1-866-208-3676) or email at 
[email protected], or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at 
[email protected].

    By direction of the Commission.

    Issued: April 18, 2019
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2019-08236 Filed 4-23-19; 8:45 am]
BILLING CODE 6717-01-P