Document ID: FERC-2023-0277-0001
Agency: ferc
Document Type: Notice
Title: Order: North American Electric Reliability Corp.; Approving Extreme Cold Weather Reliability Standards EOP-011-3 and EOP-012-1 and Directing Modification of Reliability Standard EOP-012-1
Posted Date: 2023-03-10T05:00Z

[Federal Register Volume 88, Number 47 (Friday, March 10, 2023)]
[Notices]
[Pages 14994-15011]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-04875]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. RD23-1-000]

North American Electric Reliability Corporation; Order Approving 
Extreme Cold Weather Reliability Standards EOP-011-3 and EOP-012-1 and 
Directing Modification of Reliability Standard EOP-012-1

    Before Commissioners: Willie L. Phillips, Acting Chairman; James P. 
Danly, Allison Clements, and Mark C. Christie.
    1. On October 28, 2022, the North American Electric Reliability 
Corporation (NERC), the Commission-certified Electric Reliability 
Organization (ERO), submitted a petition seeking approval of proposed 
Reliability Standards EOP-011-3 (Emergency Operations) and EOP-012-1 
(Extreme Cold Weather Preparedness

[[Page 14995]]

and Operations).\1\ As discussed in this order, we approve proposed 
Reliability Standards EOP-011-3 and EOP-012-1, their associated 
violation risk factors and violation severity levels, and the newly 
defined terms Generator Cold Weather Critical Component, Extreme Cold 
Weather Temperature, and Generator Cold Weather Reliability Event.
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    \1\ The proposed Reliability Standards are not attached to this 
order. The proposed Reliability Standards are available on the 
Commission's eLibrary document retrieval system in Docket No. RD23-
1-000 and on the NERC website, www.nerc.com.
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    2. It is essential to the reliable operation of the Bulk-Power 
System to ``ensure enough generating units will be available during the 
next cold weather event.'' \2\ As the November 2021 Report found, the 
Bulk-Power System ``cannot operate reliably without adequate 
generation.'' When cold weather events such as Winter Storm Uri occur, 
with ``massive numbers of generating units'' failing, grid operators 
could have no other option than to shed firm customer load to prevent 
uncontrolled load shedding and cascading outages. And as unfortunately 
illustrated by Winter Storm Uri, ``[t]hese firm load shedding events . 
. . have very real human consequences. Millions went without heat . . . 
Hundreds died from hypothermia.'' \3\ Accordingly, we approve proposed 
Reliability Standards EOP-011-3 and EOP-012-1 as just, reasonable, not 
unduly discriminatory or preferential, and in the public interest.
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    \2\ FERC, NERC, and Regional Entity Staff, The February 2021 
Cold Weather Outages in Texas and the South Central United States, 
at 189 (Nov. 16, 2021), https://www.ferc.gov/media/february-2021-cold-weather-outages-texas-and-south-central-united-states-ferc-nerc-and (November 2021 Report).
    \3\ Id.
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    3. While NERC's proposed Reliability Standards may ``provide new 
protections not currently found in any Reliability Standard,'' \4\ EOP-
012-1, in its current form, includes undefined terms, broad 
limitations, exceptions and exemptions, and prolonged compliance 
periods. Thus, we find that Reliability Standard EOP-012-1 requires 
improvement to address concerns, as discussed further below. Therefore, 
pursuant to section 215(d)(5) of the Federal Power Act (FPA),\5\ we 
direct NERC to develop and submit modifications to Reliability Standard 
EOP-012-1 as discussed herein.
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    \4\ NERC Petition at 7.
    \5\ 16 U.S.C. 824o(d)(5).
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    4. As an initial matter, we are concerned that use of the terms 
``continuous run,'' ``commits or is obligated to serve'' and ``four 
hours or more,'' as well as the enumerated exemptions, obfuscates the 
extent of applicability of Reliability Standard EOP-012-1 to bulk 
electric system \6\ facilities, and may not ensure that compliance is 
required for all ``generating units that are being depended upon to 
operate in cold weather and on which the reliability of the system 
depends.'' \7\ We understand that the proposed applicability criteria 
is meant to avoid ``undue burden on those generating units that are not 
expected to operate in cold weather;'' \8\ however, we find that 
excluded generating units should be the exception and not the rule.\9\ 
Therefore, we direct NERC, pursuant to FPA section 215(d)(5), to modify 
Reliability Standard EOP-012-1 to ensure that it captures all bulk 
electric system generation resources needed for reliable operation and 
excludes only those generation resources not relied upon during 
freezing conditions.\10\ As discussed further below, our directive to 
NERC is to clarify the language of the applicability section to align 
with NERC's explanation of the entities that should already be 
preparing to comply with the Standard, and should not need additional 
implementation time. Therefore, NERC should ensure the modified 
applicability section of Reliability Standard EOP-012 is implemented as 
of the effective date \11\ of Reliability Standard EOP-012-1.
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    \6\ NERC's Commission-approved bulk electric system definition 
defines the scope of the Reliability Standards and the entities 
subject to NERC compliance. Revisions to Electric Reliability 
Organization Definition of Bulk Electric System and Rules of 
Procedure, Order No. 773, 141 FERC ] 61,236 (2012), order on reh'g, 
Order No. 773-A, 143 FERC ] 61,053 (2013) rev'd sub nom. People of 
the State of New York v. FERC, 783 F.3d 946 (2d Cir. 2015); NERC 
Glossary at 5-7.
    \7\ NERC Petition at 30.
    \8\ Id.
    \9\ As discussed below, we also find that, even as to the 
limited set of excluded generating units, the obligation to have a 
cold weather emergency preparedness plan(s) and training should 
remain.
    \10\ 16 U.S.C. 824o(d)(5) (stating that the Commission, ``upon 
its own motion or upon complaint, may order the Electric Reliability 
Organization to submit to the Commission a proposed reliability 
standard or a modification to a reliability standard that addresses 
a specific matter if the Commission considers such a new or modified 
reliability standard appropriate to carry out this section'').
    \11\ This order uses the term ``effective date'' to mean the 
mandatory and enforceable date of the Standards, which, according to 
NERC's implementation plan, is 18 months after regulatory approval. 
NERC Petition at 50-51.
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    5. Further, as Reliability Standard EOP-011-2 requirements to 
implement and maintain cold weather preparedness plan(s) and associated 
training applies to all bulk electric system generating units, we defer 
our decision on whether to approve or modify NERC's proposed 
implementation date for Reliability Standard EOP-011-3 (and proposed 
retirement of Reliability Standard EOP-011-2) until NERC submits its 
revised applicability section for EOP-012. Allowing EOP-011-2 
requirements to remain mandatory and enforceable until such time as the 
revised applicability is effective for EOP-012 will ensure all bulk 
electric system generating units are required to maintain cold weather 
preparedness plans.
    6. In addition, we direct NERC to develop and submit modifications 
to Reliability Standard EOP-012-1 Requirements R1 and R7 to address 
concerns related to the ambiguity of generator-defined declarations of 
technical, commercial, or operational constraints that exempt a 
generator owner from implementing the appropriate freeze protection 
measures. We direct NERC to include in the Standard: objective criteria 
on permissible technical, commercial, and operational constraints, to 
identify the appropriate entity that would receive the generator 
owners' constraint declarations under EOP-012-1 Requirements R1 and R7, 
to describe how that entity would confirm that the generator owners 
comply with the objective criteria, and to describe the consequences of 
providing a constraint declaration. We direct NERC to modify this 
Standard to ensure that declarations cannot be used to opt out of 
mandatory compliance with the Standard or obligations set forth in a 
corrective action plan. We direct NERC to submit a revised Reliability 
Standard that addresses these concerns no later than 12 months after 
the date of issuance of this order.
    7. Under Requirement R1 of EOP-012-1, generator owners must 
``[i]mplement freeze protection measures that provide capability to 
operate for a period of not less than twelve (12) continuous hours at 
the Extreme Cold Weather Temperature'' or ``[e]xplain in a declaration 
any technical, commercial, or operational constraints . . . that 
preclude the ability to implement appropriate freeze protection 
measures to provide capability of operating at twelve (12) hours at the 
documented Extreme Cold Weather Temperature.'' \12\ Yet, based on 
comments and our reading of the plain text of the Standard, we are 
concerned that the requirement as written is unclear whether new 
intermittent units

[[Page 14996]]

will be considered by all generator owners as being capable of 
operating for at least 12 continuous hours, and thus, must comply with 
the Requirement. Therefore, we direct NERC to modify the Standard to 
clarify Reliability Standard EOP-012-1 Requirement R1 to ensure that 
generators that are technically incapable of operating for 12 
continuous hours (e.g., solar facilities during winter months with less 
than 12 hours of sunlight) are not excluded from complying with the 
Standard. We direct NERC to submit the revised Reliability Standard no 
later than 12 months after the date of issuance of this order.
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    \12\ Reliability Standard EOP-012-1, Requirement R1.
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    8. Under Requirement R2 of EOP-012-1, each generator owner is 
required to ``ensure its generating unit(s) add new or modify existing 
freeze protection measures as needed to provide the capability to 
operate for a period of not less than one (1) hour at the unit(s) 
Extreme Cold Weather Temperature.'' \13\ We find that the one-hour 
continuous operations requirement in Reliability Standard EOP-012-1 
Requirement R2 is too short of a period to adequately meet the purpose 
of the Standard to ensure generating units ``mitigate the reliability 
impacts of extreme cold weather.'' \14\ Thus, we direct NERC to modify 
the one-hour continuous operations requirement of Reliability Standard 
EOP-012-1 Requirement R2. We direct NERC to submit the revised 
Reliability Standard no later than 12 months after the date of issuance 
of this order.
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    \13\ Reliability Standard EOP-012-1, Requirement R2.
    \14\ NERC Petition at 29 (noting that freeze protection measures 
of the Standard would advance the reliability of the Bulk-Power 
System by helping to improve generator reliability in cold weather).
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    9. In addition, Reliability Standard EOP-012-1 does not require a 
deadline for, or a maximum duration of, corrective action plan 
implementation completion. We are concerned that the lack of a time 
limit for implementation completion of corrective action plans could 
allow identified issues to remain unresolved for a significant and 
indefinite period. Therefore, we direct NERC pursuant to FPA section 
215(d)(5), to modify Reliability Standard EOP-012-1 Requirements R7 to 
include deadlines for implementation completion of corrective action 
plans, as recommended in the November 2021 Report.\15\ We direct NERC 
to submit the revised Reliability Standard no later than 12 months 
after the date of issuance of this order.
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    \15\ See, e.g., November 2021 Report at 187 (discussing Key 
Recommendation 1d, which, while recommending that the standards 
drafting team have flexibility to determine the specific timing for 
the corrective action plan to be developed and implemented after the 
outage, derate or failure to start, also recommends that the 
corrective action plan ``be developed as quickly as possible, and be 
completed by no later than the beginning of the next winter 
season.'').
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    10. Additionally, we are concerned that generator owners will not 
have to implement freeze protection measures for existing generating 
units to provide them with the capability to operate for the specified 
durations at the Extreme Cold Weather Temperature under proposed EOP-
012-1 Requirement R2 until 60 months from regulatory approval. Thus, we 
direct NERC to modify the EOP-012-1 60-month implementation plan for 
existing generating units. Although we are giving NERC the discretion 
to determine what the effective date should be shortened to, we also 
emphasize that industry has been aware of and alerted to the need to 
prepare their generating units for cold weather since at least 
2011.\16\ This finding was repeated in the 2019 South Central Event 
Report \17\ and the November 2021 Report.\18\ After the 2019 South 
Central Event Report, it was found that one third of the generator 
owners and operators surveyed ``still had no winterization provisions 
after multiple recommendations on winter preparedness for generating 
units.'' \19\ NERC should consider the amount of time that industry has 
already had to implement freeze protection measures when determining 
the appropriate implementation period. Further, we find that a phased 
compliance within the implementation time for Reliability Standard EOP-
012-1 Requirement R2 will also reduce reliability risks. To address 
these concerns, we direct NERC to modify the EOP-012-1 implementation 
plan for Requirement R2 to require a staggered implementation for 
existing unit(s) in a generator owner's fleet with an effective date of 
less than 60 months from regulatory approval.\20\
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    \16\ See, e.g., FERC and NERC Staff, Report on Outages and 
Curtailments During the Southwest Cold Weather Event of February 1-
5, 2011: Causes and Recommendations, at 208 (Aug. 2011), https://www.ferc.gov/sites/default/files/2020-07/OutagesandCurtailmentsDuringtheSouthwestColdWeatherEventofFebruary1-5-2011.pdf (recommending that each generator owner and operator 
should take steps to ensure that winterization is in place before 
the inter season and take preventative action in a timely manner).
    \17\ FERC and NERC Staff, The South Central United States Cold 
Weather Bulk Electric System Event of January 17, 2018, at 80-81 
(July 2019), https://www.ferc.gov/sites/default/files/legal/staff-reports/2019/07-18-19-ferc-nerc-report.pdf (finding that the event 
was ``caused by failure to properly prepare or `winterize' the 
generation facilities for cold temperatures'').
    \18\ November 2021 Report at 185 (finding that ``generation 
freezing issues were the number one cause of the Event, and the same 
frequently-seen frozen components reappear'').
    \19\ Id.
    \20\ See e.g., Generator Verification Reliability Standards, 
Order No. 796, 146 FERC ] 61,213, at PP 1-2 (2014) (approving 
Reliability Standard MOD-025-2 and its associated staggered 
implementation plan, which required 40% of applicable facilities to 
be verified in 2 years, 60% in 3 years, 80% in 4 years, and 100% in 
5 years).
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    11. We also find it necessary that NERC ensure that Reliability 
Standard EOP-012-1 adequately addresses the reliability concerns 
related to generator owner constraint declarations, the adequacy of the 
Extreme Cold Weather Temperature definition, and determine whether 
future modification is needed, as discussed in more detail below. We 
note that, under the proposed implementation plan, it will be five 
years before certain requirements will be effective and a longer period 
before experiential data will be available. Notwithstanding our 
directives to shorten the implementation period for certain 
Requirements, waiting to collect data until after implementation will 
not provide timely information on the effectiveness of winterization 
efforts. However, section 1600 of NERC's Rules of Procedure provides a 
mechanism for data collections that could be used during the period 
prior to full implementation. Therefore, we direct NERC, pursuant to 
section 39.2(d) of the Commission's regulations,\21\ to work with 
Commission staff to submit a plan no later than 12 months after the 
date of issuance of this order explaining how it will collect and 
assess data prior to and after the implementation of the following 
elements of Reliability Standard EOP-012-1: (1) generator owner 
declared constraints and explanations thereof; and (2) the adequacy of 
the Extreme Cold Weather Temperature definition.
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    \21\ 18 CFR 39.2(d) (2021) (the ERO shall provide the Commission 
such information as is necessary to implement section 215 of the 
FPA).
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I. Background

A. Section 215 and Mandatory Reliability Standards

    12. Section 215 of the FPA provides that the Commission may certify 
an ERO, the purpose of which is to develop mandatory and enforceable 
Reliability Standards, subject to Commission review and approval.\22\ 
Reliability Standards may be enforced by the ERO, subject to Commission 
oversight, or by the Commission independently.\23\ Pursuant to section 
215 of the FPA, the Commission established a process to

[[Page 14997]]

select and certify an ERO,\24\ and subsequently certified NERC.\25\
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    \22\ 16 U.S.C. 824o(c).
    \23\ Id. Sec.  824o(e).
    \24\ Rules Concerning Certification of the Elec. Reliability 
Org.; & Procs. for the Establishment, Approval, & Enforcement of 
Elec. Reliability Standards, Order No. 672, 114 FERC ] 61,104, order 
on reh'g, Order No. 672-A, 114 FERC ] 61,328 (2006).
    \25\ N. Am. Elec. 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. The February 2021 Cold Weather Reliability Event

    13. On February 16, 2021, the Commission, NERC, and Regional Entity 
staff initiated a joint inquiry into the circumstances surrounding a 
February 2021 cold weather reliability event that affected Texas and 
the South-Central United States that culminated in a report 
identifying, among other things, recommendations for Reliability 
Standard improvements.\26\ The November 2021 Report found that the 
February 2021 cold weather reliability event was the largest controlled 
firm load shed event in U.S. history; over 4.5 million people lost 
power and at least 210 people lost their lives during the event.\27\ 
The November 2021 Report provided an assessment of the event as well as 
recommendations including, inter alia, Reliability Standard 
enhancements to improve extreme cold weather operations, preparedness, 
and coordination.\28\
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    \26\ See November 2021 Report at 9.
    \27\ Id.
    \28\ Id. at 184-212 (sub-recommendations 1a through 1j).
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    14. After the February 2021 cold weather reliability event, but 
before the November 2021 Report was issued, NERC filed a petition for 
approval of cold weather Reliability Standards addressing 
recommendations from a 2018 cold weather event report.\29\ In August 
2021, the Commission approved NERC's modifications to Reliability 
Standards EOP-011-2 (Emergency Preparedness and Operations), IRO-010-4 
(Reliability Coordinator Data Specification and Collection), and TOP-
003-5 (Operational Reliability Data).\30\ Reliability Standards IRO-
010-4 and TOP-003-5 require that reliability coordinators, transmission 
operators, and balancing authorities develop, maintain, and share 
generator cold weather data.\31\ EOP-011-2 requires generator owners to 
have generating unit cold weather preparedness plans and generator 
owners and generator operators to provide training for implementing the 
cold weather preparedness plans.\32\
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    \29\ 2019 South Central Event Report at 89.
    \30\ See generally Order Approving Cold Weather Reliability 
Standards, 176 FERC ] 61,119 (2021) (noting that the standards 
become enforceable on April 1, 2023).
    \31\ Id.
    \32\ Id.
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C. NERC's Petition and Proposed Reliability Standards EOP-011-3 and 
EOP-012-1

    15. On October 28, 2022, NERC filed a petition seeking approval on 
an expedited basis of Reliability Standards EOP-011-3 and EOP-012-1, 
the Standards' associated violation risk factors and violation severity 
levels, three newly-defined terms (Extreme Cold Weather Temperature, 
Generator Cold Weather Critical Component, and Generator Cold Weather 
Reliability Event), NERC's proposed implementation plan, and the 
retirement of currently approved EOP-011-2.\33\ NERC explains that 
Reliability Standards EOP-011-3 and EOP-012-1 build upon the 2021-
approved cold weather Reliability Standards by further strengthening 
the reliability of the Bulk-Power System during extreme cold weather 
conditions.\34\ NERC maintains that proposed Reliability Standards EOP-
011-3 and EOP-012-1 are consistent with key recommendations for 
standards' improvement from the November 2021 Report.\35\ Specifically, 
NERC states that the proposed Reliability Standards contain new and 
revised requirements to advance the reliability of the Bulk-Power 
System through the implementation of freeze protection measures, 
enhanced weather preparedness plans, annual training, and the 
coordination of manual and automatic load shed.\36\
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    \33\ NERC Petition at 1-2.
    \34\ Id.
    \35\ Id. at 23; see also November 2021 Report at 184-92, 208-10 
(Key Recommendations 1b, 1d, 1e, 1f, and 1j).
    \36\ NERC Petition at 23.
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    16. NERC states that the purpose of proposed Reliability Standard 
EOP-011-3 is to ensure that each transmission operator implements plans 
to mitigate operating emergencies and that such plans are coordinated 
within the reliability coordinator area. According to NERC, proposed 
Reliability Standard EOP-011-3 addresses Key Recommendation 1j from the 
November 2021 Report, which recommends that the circuits used for 
manual load shed be separated from the circuits used for automatic load 
shed or for critical loads.\37\
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    \37\ See id. at 20 (citing the November 2021 Report at 208-10 
(recommending that transmission operators use automatic load shed as 
a last resort)).
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    17. NERC proposes to modify approved Reliability Standard EOP-011-2 
in multiple ways.\38\ First, NERC proposes to remove Requirements R7 
and R8 (generator cold weather preparedness plans and associated 
training) from EOP-011-2 and incorporate them into proposed Reliability 
Standard EOP-012-1 as Requirements R3 and R5, respectively.\39\ Second, 
the added Requirements R1 and R2 of EOP-011-3 require that transmission 
operator emergency operating plans include provisions that minimize the 
overlap of manual load shed circuits, circuits that serve critical 
loads, and circuits that are used for underfrequency load shedding 
(UFLS) or undervoltage load shedding (UVLS).\40\ Third, Requirement R1 
requires the development of provisions that limit manual load shed of 
UFLS or UVLS circuits to situations warranted by system conditions.\41\ 
Finally, Requirement R2 adds provisions for transmission operators to 
implement the operator-controlled manual load shed in accordance with 
Requirement R1. NERC also requests that the currently approved 
Reliability Standard EOP-011-2, which will go into effect on April 1, 
2023, be retired immediately prior to the effective date of Reliability 
Standard EOP-011-3 and EOP-012-1, i.e., 18 months after regulatory 
approval.\42\
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    \38\ Reliability Standard EOP-011-3, Requirements R3, R4, and R5 
are unchanged from the approved version. See Order Approving Cold 
Weather Reliability Standards, 176 FERC ] 61,119 (approving EOP-011-
2).
    \39\ Id.; NERC Petition at 45-46.
    \40\ NERC Petition at 46-49.
    \41\ Id. Ex. A-1, at 2-3.
    \42\ NERC Petition at 50.
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    18. NERC requests approval of a new Reliability Standard, EOP-012-
1, which it states is meant to apply to generator owners and operators 
of generating units that are depended upon to operate during cold 
weather and Blackstart Resources. The purpose of Reliability Standard 
EOP-012-1 is to ensure that each generator owner develops and 
implements plans to alleviate the reliability effects of extreme cold 
weather on its generating units.\43\ According to NERC, this new 
Reliability Standard addresses parts of Key Recommendation 1a as well 
as 1d, 1e, and 1f of the November 2021 Report.\44\
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    \43\ Id. at 29.
    \44\ See id. at 17-18 (citing the November 2021 Report at 184-
89).
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    19. Proposed Reliability Standard EOP-012-1 has seven requirements, 
five of which are new (Requirements R1, R2, R4, R6, and R7) and two of 
which (Requirements R3 and R5) were moved and revised from approved 
Reliability Standard EOP-011-2. Reliability

[[Page 14998]]

Standard EOP-012-1 Requirements R1 and R2 address a generator owner's 
obligation to implement freeze protection measures on its applicable 
units to provide them with the capability to operate at the Extreme 
Cold Weather Temperature for the unit's location.\45\ Specifically, 
Requirement R1 requires either new units to be capable of operating at 
the Extreme Cold Weather Temperature for a continuous 12-hour period or 
that the generator owner declares that technical, commercial, or 
operational constraints prevent successful continuous operation. 
Requirement R2 requires either that existing units be capable of 
continuous operation for at least one hour at the Extreme Cold Weather 
Temperature or the generator owner to develop a corrective action plan 
to address the unit's inability to continuously operate 
successfully.\46\
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    \45\ Id. at 33-37.
    \46\ NERC defines the term ``corrective action plan'' as a 
``list of actions and an associated timetable for implementation to 
remedy a specific problem.'' NERC, Glossary of Terms Used in NERC 
Reliability Standards, 11 (Dec. 2022) (NERC Glossary), https://www.nerc.com/pa/Stand/GlossaryofTerms/Glossary_of_Terms.pdf. See 
also Reliability Standard EOP-012-1, section 4.3.
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    20. Reliability Standard EOP-012-1 Requirements R3 and R5 require 
generator owners to implement cold weather preparedness plans 
(Requirement R3) and train their personnel on that plan annually 
(Requirement R5).\47\ Requirement R3 also identifies the generator 
owner as the entity responsible for identifying the Extreme Cold 
Weather Temperature and Generator Cold Weather Critical Components for 
its unit(s); the generator owner must document both in its cold weather 
preparedness plan(s).
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    \47\ NERC Petition at 37-41 (stating that Requirements R3 and R5 
were taken from Requirements R7 and R8 from Commission approved EOP-
011-2 with modifications to ensure that a generator owner's cold 
weather preparedness plan includes the Extreme Cold Weather 
Temperature, Generator Cold Weather Critical Components, and freeze 
protection measures).
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    21. Reliability Standard EOP-012-1 Requirement R4 requires the 
generator owner to review its Extreme Cold Weather Temperature 
calculation, cold weather preparedness plan(s), and freeze protection 
measures every five years to determine if changes or updates are 
warranted.\48\ Requirement R6 mandates that each generator owner 
experiencing an outage, failure to start, or derate due to freezing 
conditions develop a corrective action plan to address the identified 
causes. Lastly, Requirement R7 requires generator owners to implement 
corrective action plans developed pursuant to Requirements R2, R4, or 
R6, or explain in a declaration why they are not implementing 
corrective actions due to technical, commercial, or operational 
constraints.\49\
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    \48\ Id. at 39-40 (this periodic review may require the 
generator owner to add or modify existing freeze protection measures 
to continue reliable operation).
    \49\ Id. at 43-45 (noting that the generator owner defines these 
constraints).
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    22. NERC requests the Commission approve the violation risk factors 
and violation severity levels for Reliability Standards EOP-011-3 and 
EOP-012-1. NERC states that the violation risk factors and violation 
severity levels for Reliability Standard EOP-011-3 did not change from 
approved Reliability Standard EOP-011-2. NERC also proposes violation 
risk factors and violation severity levels for new Reliability Standard 
EOP-012-1.\50\
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    \50\ Id. Ex. E at 7-20 (explaining NERC's justifications for 
each violation risk factor and violation severity level associated 
with Reliability Standard EOP-012-1).
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    23. NERC proposes an 18-month effective date for Reliability 
Standards EOP-011-3 and EOP-012-1, beginning on the first day of the 
first calendar quarter following regulatory approval.\51\ All the 
requirements of Reliability Standard EOP-011-3 would be effective on 
this date.
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    \51\ NERC Petition at 50-51.
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    24. Specific to the requirements of EOP-012-1, as of the effective 
date, generator owners will be required to update their cold weather 
preparedness plans to include the Extreme Cold Weather Temperature and 
Generator Cold Weather Critical Components, and document freeze 
protection measures for those components as required by EOP-012-1 
Requirement R3 as well as provide unit-specific cold weather plan 
training on an annual basis as required by Requirement R5. Within 150 
days of the effective date, generator owners will be required to 
develop corrective action plans, or declare constraints, as required by 
proposed EOP-012-1 Requirements R6 and R7. NERC also proposes that 
generator owners have an additional 42 months from the effective date 
of proposed Reliability Standard EOP-012-1 (i.e., 60 months from the 
regulatory approval date) to come into compliance with the new freeze 
protection measures of EOP-012-1 Requirements R1 and R2 and an 
additional 60 months from the effective date (i.e., 78 months from the 
regulatory approval date) to perform the first re-evaluation of the 
Extreme Cold Weather Temperature for their units and update cold 
weather preparedness plans and unit freeze protection measures, 
including developing any corrective action plans, as needed for 
proposed EOP-012-1 Requirement R4.
    25. NERC explains that it considered these implementation 
timeframes necessary for generator owners to calculate the Extreme Cold 
Weather Temperature for each generating unit, to identify Generator 
Cold Weather Critical Components, and to perform the necessary 
engineering studies and analyses to identify and implement freeze 
protection measures that would provide for the required performance 
capability or to explain why such measures are precluded by technical, 
commercial, or operational constraints. NERC also states that generator 
owners need additional time to implement the freeze protection measures 
of EOP-012-1 Requirements R1 and R2 because of the significant 
engineering, design, analysis, and implementation efforts required to 
complete such work.\52\
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    \52\ Id. at 52.
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    26. NERC explains that it adopted a two-phase standard development 
project to develop, draft, and revise the extreme cold weather 
Reliability Standards in accordance with the November 2021 Report due 
to the extensive scope and demonstrated urgency of new and improved 
cold weather Reliability Standards.\53\ NERC states that its October 
28, 2022, petition represents phase one of its standard development 
project and that the remaining November 2021 Report recommendations 
will be addressed in the second phase of standards development. In 
phase two, NERC states that its standard drafting team also plans to 
consider industry concerns that arose in phase one.
---------------------------------------------------------------------------

    \53\ Id. at 53 (noting that NERC anticipates completing 
development and filing with the Commission new or revised 
Reliability Standards by November 1, 2023).
---------------------------------------------------------------------------

    27. Finally, NERC requests the Commission approve the proposed 
Standards in an expedited manner. NERC explains that, among other 
things, an expedited approval would provide regulatory certainty to 
entities seeking to implement the Standards ahead of the mandatory and 
enforceable dates.\54\
---------------------------------------------------------------------------

    \54\ Id. at 55.
---------------------------------------------------------------------------

II. Notice of Filing and Responsive Pleadings

    28. Notice of NERC's October 28, 2022, Petition was published in 
the Federal Register, 87 FR 67464 (Nov. 8, 2022), with comments, 
protests, and motions to intervene due on or before December 1, 2022.
    29. On November 17, 2022, the Electric Power Supply Association 
(EPSA) filed a motion for an extension of time to submit comments. On

[[Page 14999]]

November 29, 2022, the Commission extended the comment period seven 
days to and including December 8, 2022.
    30. The Commission received six sets of comments and five reply 
comments. The LS Power Development, LLC; Calpine Corporation; EPSA; PJM 
Power Providers Group (PJM Group); Transmission Access Policy Study 
Group (TAPS); the National Rural Electric Cooperative Association 
(NRECA); American Public Power Association (APPA); the Independent 
System Operators and Regional Transmission Organization Council (ISO/
RTO Council); Edison Electric Institute (EEI); New England Power 
Generators Association, Inc. (NEPGA); and Invenergy LLC (Invenergy) 
filed timely motions to intervene. TAPS, the ISO/RTO Council, NEPGA, 
Invenergy, EPSA/PJM Group jointly, and the Texas Competitive Power 
Advocates (TCPA) filed timely comments. NERC filed reply comments out 
of time. Invenergy filed a motion for leave to reply and reply comments 
out of time. NEPGA/EPSA/PJM Group filed a joint out of time motion for 
leave to answer and joint answer to the ISO/RTO Council's comments. 
APPA/TAPS filed a joint out of time motion for leave to answer along 
with a joint answer to EPSA's comments. The ISO/RTO Council also filed 
an out of time motion for leave to answer along with an answer to the 
NERC's reply comments and NEPGA/EPSA/PJM Group's answer.
    31. Commenters either did not address or were generally supportive 
of NERC's proposed modifications to Reliability Standard EOP-011-3.\55\ 
Commenters raised concerns and requests for clarifications for NERC's 
proposed Reliability Standard EOP-012-1. The commenters range in their 
support for Reliability Standard EOP-012-1 from requesting that the 
Commission approve the Standard as filed with minor clarifications \56\ 
to remanding the Standard to NERC with directives.\57\ The comments on 
specific matters are summarized and addressed in the determinations 
below.
---------------------------------------------------------------------------

    \55\ E.g., EPSA/PJM Group Comments at 3; NEPGA/EPSA/PJM Group 
Answer at 1; ISO/RTO Council Comments at 1-2, TAPS Comments at 1.
    \56\ See APPA/TAPS Answer at 2-9; ISO/RTO Comments at 1-3; ISO/
RTO Answer at 1-2; TAPS Comments at 1.
    \57\ See EPSA/PJM Group Comments at 2-4; Invenergy Comments at 
2, 13; NEPGA Comments at 2, 6-8; TCPA Comments at 2, 5-6.
---------------------------------------------------------------------------

III. Determination

A. Procedural Matters

    32. Pursuant to Rule 214 of the Commission's Rules of Practice and 
Procedure, 18 CFR 385.214 (2021), the timely, unopposed motions to 
intervene serve to make the entities that filed them parties to this 
proceeding.
    33. Rule 213(a)(2) of the Commission's Rules of Practice and 
Procedure, 18 CFR 385.213(a)(2) (2021), prohibits an answer to a 
protest or answer unless otherwise ordered by the decisional authority. 
Pursuant to Rule 214(d) of the Commission's Rules of Practice and 
Procedure, 18 CFR 385.214(d), we grant NERC and Invenergy's leave to 
file their late-filed reply comments given their interest in the 
proceeding and the absence of undue prejudice or delay. We also grant 
APPA/TAPS, NEPGA/EPSA/PJM Group, and the ISO/RTO Council's motions for 
leave to file out of time answers and we accept their answers because 
they have provided information that assisted us in our decision-making 
process.

B. Substantive Matters

    34. Pursuant to section 215(d)(2) of the FPA, we approve 
Reliability Standards EOP-011-3 and EOP-012-1 as just, reasonable, not 
unduly discriminatory or preferential and in the public interest. As 
discussed in this order, we approve proposed Reliability Standards EOP-
011-3 and EOP-012-1, their associated violation risk factors and 
violation severity levels, the newly defined terms Generator Cold 
Weather Critical Component, Extreme Cold Weather Temperature, and 
Generator Cold Weather Reliability Event. We defer our decision on 
whether to approve or modify NERC's proposed implementation date for 
Reliability Standard EOP-011-3 (and proposed retirement of Reliability 
Standard EOP-011-2) until NERC submits its revised applicability 
section for EOP-012, as discussed in more detail below. Absent the 
reforms adopted in Reliability Standards EOP-011-3 and EOP-012-1, the 
existing defects and inefficiencies exhibited during extreme cold 
weather conditions could be exacerbated and negatively affect 
reliability.
    35. We find that Reliability Standard EOP-011-3 is an improvement 
over the 2021-approved cold weather Reliability Standards and enhances 
reliability by improving how transmission operators account for the 
overlap of manual load shed and automatic load shed in their emergency 
operating plans while also addressing the need to minimize the use of 
manual load shed that could further exacerbate emergencies and threaten 
system reliability. Commenters did not express concern with Reliability 
Standard EOP-011-3. Accordingly, we approve Reliability Standard EOP-
011-3.
    36. We find that Reliability Standard EOP-012-1 represents an 
improvement to the Reliability Standards and enhances the reliable 
operation of the Bulk-Power System by requiring generator owners to 
implement freeze protection measures, develop enhanced cold weather 
preparedness plans, implement annual trainings, draft and implement 
corrective action plans to address freezing issues, and provide certain 
cold weather operating parameters to reliability coordinators, 
transmission operators, and balancing authorities for use in their 
analyses and planning. We believe that these measures begin to address 
many of the issues identified as contributing to generating unit 
failures during extreme cold weather conditions, as noted in the 
November 2021 Report.\58\ We also appreciate that NERC completed the 
modifications and development of Reliability Standards EOP-011-3 and 
EOP-012-1 in a timely manner.
---------------------------------------------------------------------------

    \58\ See November 2021 Report at 184-210.
---------------------------------------------------------------------------

    37. Several commenters express concern regarding ambiguities in 
Requirements R1 and R7 of Reliability Standard EOP-012-1 pertaining to 
the generator owner declarations for ``technical, commercial, or 
operational constraints'' and ask the Commission to remand the Standard 
with direction to NERC for clarifications.\59\ As discussed below, we 
agree that the provisions are ambiguous. However, we are not persuaded 
that there is sufficient cause to remand Reliability Standard EOP-012-
1. Since we find that the Standard enhances the reliable operation of 
the Bulk-Power System, we conclude that the better course is to approve 
Reliability Standard EOP-012-1 so that it will take effect in a timely 
manner. Nevertheless, pursuant to our authority under FPA section 
215(d)(5), we also direct NERC to develop modifications to address the 
concerns regarding Requirements R1 and R7, as well as other concerns we 
have identified as to other aspects of Reliability Standard EOP-012-1, 
without delaying the effective date of Reliability Standard EOP-012-1. 
This approach is consistent with Commission precedent.\60\
---------------------------------------------------------------------------

    \59\ See e.g., EPSA/PJM Group Comments at 7-9; ISO/RTO Council 
Comments at 10; NEPGA Comments at 7-8.
    \60\ See e.g., Mandatory Reliability Standards for the Bulk-
Power Sys., Order No. 693, 118 FERC ] 61,218, at P 10 (2007) (noting 
that ``[w]here a Reliability Standard requires significant 
improvement, but is otherwise enforceable, the Commission approves 
the Reliability Standard'' and ``directs the ERO to modify'' such 
Standards to address identified issues or concerns); Version 5 
Critical Infrastructure Prot. Reliability Standards, Order No. 791, 
145 FERC] 61,160, at PP 1-4 (2013), order on clarification and 
reh'g, Order No. 791-A, 146 FERC ] 61,188 (2014).

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

[[Page 15000]]

    38. While we understand that the implementation plan for 
Reliability Standard EOP-012-1 is designed to accommodate entities that 
may need time to determine Extreme Cold Weather Temperature values, 
identify cold weather critical components for applicable generating 
units, develop corrective action plans for freeze issues, perform 
various engineering analyses, provide the required training, and 
develop the necessary capabilities to satisfy revised data 
specifications, industry has been aware of and alerted to the need to 
prepare their generating units for cold weather since at least 2011. 
Therefore, we direct NERC to reduce the implementation time and to 
include a staggered implementation for Requirement R2 to reduce 
reliability risks. NERC should consider the amount of time that 
industry has already been alerted to the need to implement freeze 
protection measures when determining the appropriate implementation 
period. We also strongly encourage entities that are capable of 
complying with these Standards earlier than the mandatory and 
enforceable date to do so.
    39. In addition to the directives to modify various aspects of 
Reliability Standard EOP-012-1, we also have concerns regarding 
generator owner constraint declarations and the adequacy of the Extreme 
Cold Weather Temperature definition that may be addressed with 
additional information. Therefore, pursuant to section 39.2(d) of the 
Commission's regulations,\61\ NERC is hereby directed to work with 
Commission staff to submit a plan no later than 12 months after the 
date of issuance of this order on how it will collect and assess, 
through annual and event-based data submittals, the following elements 
of Reliability Standard EOP-012-1: (1) generator owner declared 
constraints and explanations thereof; and (2) the adequacy of the 
Extreme Cold Weather Temperature definition. NERC is hereby directed to 
submit periodic reports to the Commission providing the results of the 
assessments, as discussed in further detail below.
---------------------------------------------------------------------------

    \61\ 18 CFR 39.2(d).
---------------------------------------------------------------------------

    40. Below we address the following elements of Reliability Standard 
EOP-012-1: (1) jurisdiction; (2) the applicability of Reliability 
Standard EOP-012-1; (3) generator owner declarations for technical, 
commercial, or operational constraints; (4) the Extreme Cold Weather 
Temperature definition; (5) the absence of a deadline by which 
generator owners must implement new or modified freeze protection 
measures required by their corrective action plans; (6) cost recovery 
mechanisms; (7) other technical matters; and (8) annual and event-based 
data submittals.
1. Jurisdiction
a. Background
    41. Section 215(a)(3) of the FPA defines ``Reliability Standard'' 
as:

a requirement, approved by the Commission under this section, to 
provide for reliable operation of the bulk-power system. The term 
includes requirements for the operation of existing bulk-power 
system facilities, including cybersecurity protection, and the 
design of planned additions or modifications to such facilities to 
the extent necessary to provide for reliable operation of the bulk-
power system, but the term does not include any requirement to 
enlarge such facilities or to construct new transmission capacity or 
generation capacity.\62\
---------------------------------------------------------------------------

    \62\ 16 U.S.C. 824o(a)(3).

    42. The term ``Reliable Operation'' is defined by the statute as 
``operating the elements of the bulk-power system within equipment and 
electric system thermal, voltage, and stability limits so that 
instability, uncontrolled separation, or cascading failures of such 
system will not occur as a result of a sudden disturbance . . . or 
unanticipated failure of system elements.'' \63\
---------------------------------------------------------------------------

    \63\ Id. Sec.  824o(a)(4).
---------------------------------------------------------------------------

b. Comments
    43. EPSA/PJM Group and Invenergy assert that Requirements R1 and R2 
of Reliability Standard EOP-012-1 would impose obligations on generator 
owners that ``fall outside of the scope'' of section 215 of the 
FPA.\64\ Both provisions of Reliability Standard EOP-012-1 require 
generator owners to add new, or modify existing, freeze protection 
measures, with Requirement R1 pertaining to generating units with an 
operational date subsequent to the effective date of the Reliability 
Standard, and Requirement R2 pertaining to existing generating units.
---------------------------------------------------------------------------

    \64\ See EPSA/PJM Group Comments at 5-7; Invenergy Comments at 
13.
---------------------------------------------------------------------------

    44. EPSA/PJM Group argue that while the definition of Reliable 
Operation allows NERC to require modifications to address sudden 
disturbances and unanticipated failures, ``the language of the section 
is very clear that a Reliability Standard may only cover `the 
operation' of existing facilities, where such operation shall only be 
`within' equipment limits exclusively for the purpose of mitigating 
`sudden disturbances' and `unanticipated failures.' '' \65\ In other 
words, according to EPSA/PJM Group, the statute authorizes the 
modification of existing facilities to reliably operate within their 
existing equipment limits but does not permit a Reliability Standard 
that changes a resource's equipment limits.\66\ In the same vein, 
Invenergy asserts that it is unclear whether NERC has the authority 
under section 215 of the FPA to mandate retrofits on existing 
generators because the statutory definition of Reliability Standard is 
limited to requirements ``for the operation of existing bulk-power 
system facilities.'' \67\ According to Invenergy, this language 
suggests that NERC can only mandate modifications when changes to a 
facility are already planned.\68\
---------------------------------------------------------------------------

    \65\ Id. (footnotes omitted).
    \66\ Id. at 6.
    \67\ Invenergy Comments at 13.
    \68\ Id.
---------------------------------------------------------------------------

    45. In its reply comments, NERC asserts that the requirements of 
Reliability Standard EOP-012-1 that generator owners add freeze 
protection measures is within the scope of its authority and that 
commenters argue for an overly narrow interpretation of section 215 of 
the FPA.\69\ According to NERC, EOP-012-1 satisfies a three-part 
framework for analyzing whether a proposed Reliability Standard is 
within the ERO's authority under the statute, namely that the Standard: 
(1) applies to users, owners or operators of the Bulk-Power System; (2) 
provides for the reliable operation of the Bulk-Power System; and (3) 
may include operational or design requirements, but may not address 
matters expressly excluded in the statute that were historically left 
to the jurisdiction of the states. Focusing on the third prong, NERC 
explains that Reliability Standard EOP-012-1 pertains to the operation 
of existing facilities and the design of planned additions or 
modifications to such facilities as needed to provide for the reliable 
operation of the Bulk-Power System, which is explicitly included in the 
statutory definition of Reliability Standard. NERC argues that, while 
the statutory definition of Reliability Standard specifically excludes 
``any requirement to enlarge [existing] facilities or to construct new 
transmission capacity or generation capacity,'' EPSA/PJM Group's narrow 
reading of the definition would write into the statute a new exclusion 
that does not exist.
---------------------------------------------------------------------------

    \69\ NERC Reply Comments at 3-11.
---------------------------------------------------------------------------

c. Commission Determination
    46. We are not persuaded by EPSA/PJM Group and Invenergy's 
arguments and conclude that Reliability Standard

[[Page 15001]]

EOP-012-1 Requirements R1 and R2 are within the statutory authority of 
the ERO and the Commission. We agree with NERC that EPSA/PJM Group and 
Invenergy narrowly interpret the terms ``Reliability Standard'' and 
``Reliable Operation'' under section 215 of the FPA to reach an 
inaccurate conclusion regarding the ERO and the Commission's statutory 
authority.\70\
---------------------------------------------------------------------------

    \70\ Id.; see also 16 U.S.C. 824o(a)(3)-(4).
---------------------------------------------------------------------------

    47. First, Requirements R1 and R2 of EOP-012-1 comport with the 
statutory definition of a Reliability Standard, which includes 
modifications to facilities to the extent that they are necessary to 
provide for the reliable operation of the Bulk-Power System.\71\ 
Reliability Standard EOP-012-1 Requirement R1 requires generating units 
with a commercial operation date after the effective date of the 
Standard to implement freeze protection measures so that the unit is 
capable of continuous operation for at least 12 hours at the Extreme 
Cold Weather Temperature or for the generator owner to submit a 
declaration of a technical, commercial, or operational constraint that 
preclude its ability to comply with the Standard. Requirement R2 of 
EOP-012-1 requires existing generating units to either be capable of 
continuous operation for at least one hour at the Extreme Cold Weather 
Temperature or to develop a corrective action plan to resolve the 
issue. Thus, Requirements R1 and R2's freeze protection provisions 
serve an appropriate purpose, i.e., to provide the ``Reliable 
Operation'' \72\ of the Bulk-Power System as set forth in the 
definition of a ``Reliability Standard.'' \73\ Further, neither of 
these requirements mandate the construction of new generation capacity 
or an expansion of the unit's generating capacity, which are the only 
relevant exclusions identified in the statutory definition of a 
``Reliability Standard.'' \74\
---------------------------------------------------------------------------

    \71\ 16 U.S.C. 824o(a)(3).
    \72\ Id. section 824o(a)(4).
    \73\ Id. section 824o(a)(3).
    \74\ Id.
---------------------------------------------------------------------------

    48. Moreover, we reject EPSA/PJM Group's interpretation of the 
statutory definition of ``Reliable Operation'' as imposing a limitation 
or exclusion on an acceptable Reliability Standard. EPSA/PJM Group 
recognizes that under the definition of ``Reliable Operation'' NERC may 
require modifications to mitigate ``sudden disturbances'' and 
``unanticipated failures'' of facilities to the extent necessary to 
provide for reliable Bulk-Power System operations.\75\ Indeed, the 
Commission has previously approved Reliability Standards that require 
the implementation of physical modifications to improve 
reliability.\76\ Rather, EPSA/PJM Group reads a limitation into the 
statutory definition of Reliable Operation--specifically ``within 
equipment . . . limits''--and argues that the proposed Reliability 
Standard would constitute an impermissible change to such equipment 
limits. However, we do not find this argument to be persuasive as the 
statutory language is not as narrow as EPSA/PJM Group suggests. When 
read in context, the definition of ``Reliable Operation'' contemplates 
that Reliability Standards should be designed so that facility 
equipment operates within specified limits to mitigate sudden 
disturbances and prevent unanticipated failures of system elements.\77\
---------------------------------------------------------------------------

    \75\ EPSA/PJM Group Comments at 5 (citing to 16 U.S.C. 
824(a)(4)).
    \76\ See, e.g., Order No. 693, 118 FERC ] 61,218 at PP 1547, 
1550 (approving Reliability Standard PRC-018-1, which requires the 
installation of disturbance monitoring equipment); Mandatory 
Reliability Standards for Critical Infrastructure Protection, Order 
No. 706, 122 FERC ] 61,040, at P 86 (2008) (providing entities with 
a reasonable amount of time to purchase and install new software and 
equipment for compliance); PacifiCorp, 141 FERC ] 61,140 P 1 (2014).
    \77\ 16 U.S.C. 824o(a)(4).
---------------------------------------------------------------------------

    49. EPSA/PJM Group seizes upon language from the ``Reliability 
Standard'' definition stating that the term ``includes requirements for 
the existing bulk-power system facilities. . . .'' \78\ However, other 
than EPSA/PJM Group's assertion, there is no logical reason to tie 
together the language from these two definitions to limit the statutory 
scope for the requirements of a Reliability Standard. Rather, in 
context, the ``requirements for operation of existing . . . 
facilities'' passage continues ``. . . including . . . the design of 
planned additions or modification to such facilities to the extent 
necessary to provide for reliable operation of the bulk-power system.'' 
\79\ This exactly describes the purpose of the freeze protection 
requirements in EOP-012-1, which are intended to reduce capacity that 
is forced off-line due to freezing conditions and to help ensure that 
such capacity is not forced off-line in newer units. Accordingly, we 
reject the arguments of EPSA/PJM Group that the requirements of EOP-
012-1 are beyond our or NERC's authority.
---------------------------------------------------------------------------

    \78\ EPSA/PJM Group Comments at 5.
    \79\ 16 U.S.C. 824o(a)(3).
---------------------------------------------------------------------------

    50. For similar reasons, we reject Invenergy's argument that a 
requirement to ``retrofit'' existing generators exceeds the statutory 
definition of a Reliability Standard that is limited to requirements 
``for the operation of existing bulk-power system facilities.'' \80\ 
Again, Invenergy would read in an exclusion beyond the one explicit 
exclusion stated in the definition. Moreover, Invenergy's selected 
quote ignores the language that follows which includes requirements for 
``the operation of existing bulk-power system facilities . . . and the 
design of planned additions or modifications to such facilities to the 
extent necessary to provide for reliable operation of the bulk-power 
system.'' \81\ As discussed above, Requirements R1 and R2's freeze 
protection measures satisfy the latter provision, as the record shows 
that these modifications are necessary to provide for the reliable 
operation of the Bulk-Power System.
---------------------------------------------------------------------------

    \80\ See Invenergy Comments at 13. But see NERC Petition Ex. A-
2, at 3-8 (the term ``retrofit'' not appearing in proposed 
Reliability Standard EOP-012-1).
    \81\ 16 U.S.C. 824o(a)(3).
---------------------------------------------------------------------------

2. Applicability of Reliability Standard EOP-012-1
    51. NERC's Rules of Procedure requires all Reliability Standards to 
include an applicability section that identifies (1) the registered 
functional entities required to comply with each Standard and (2) the 
bulk electric system facilities to which the requirements apply.\82\ 
Reliability Standard EOP-012-1's applicability section applies to 
registered generator owners and generator operators. Further, the 
facilities subject to the requirements of the standard include bulk 
electric system generating units that are Blackstart Resources and any 
bulk electric system generating unit that:
---------------------------------------------------------------------------

    \82\ See NERC, Rules of Procedure, App. 3A (Standard Process 
Manual), 5 (Mar. 2019), N. Am. Elec. 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).

commits or is obligated to serve a Balancing Authority load pursuant 
to a tariff obligation, state requirement as defined by the relevant 
electric regulatory authority, or other contractual arrangement, 
rule, or regulation, for a continuous run of four hours or more at 
or below a temperature of 32 degrees Fahrenheit (zero degrees 
Celsius) \83\
---------------------------------------------------------------------------

    \83\ Reliability Standard EOP-012-1, section 4.2.1.1.

    52. NERC explains that the facilities section inclusions are 
``carefully tailored to place the responsibility for cold weather 
preparedness on those generating units that are being depended on to 
operate in cold weather and on which the reliability of the system 
depends'' and that the facilities section exclusions are meant to avoid 
``undue burden on those generating

[[Page 15002]]

units that are not expected to operate in cold weather.'' \84\
---------------------------------------------------------------------------

    \84\ NERC Petition at 30.
---------------------------------------------------------------------------

a. Comments
    53. Invenergy questions which generator owner and generator 
operators must comply with Reliability Standard EOP-012-1. 
Specifically, Invenergy asserts that the applicability section of the 
Standard is not clear and unambiguous as to which entities must comply. 
Invenergy argues there are different types of generator owners that 
vary widely in how they, with their generating units, participate in 
electric markets, and requests that the Commission direct NERC to 
modify proposed Reliability Standard EOP-012-1 to provide specific 
criteria for which entities must comply.\85\
---------------------------------------------------------------------------

    \85\ Invenergy Comments at 4.
---------------------------------------------------------------------------

b. Commission Determination
    54. We agree with Invenergy that the applicability of Reliability 
Standard EOP-012-1 is unclear and ambiguous. In its technical rationale 
and justification, NERC explains that Reliability Standard EOP-012-1 is 
not meant to require all generating units to provide capacity in 
extreme cold weather. Instead, the Standard applies to those generating 
resources that are ``obligated to serve Balancing Authority load during 
periods at or below freezing due to commitments pursuant to tariff 
obligations, state requirements defined by regulatory authorities, or 
other contractual arrangements, rules, or regulations are subject to 
the winterization requirements.'' \86\ Further, NERC explains that the 
``[t]he [standard drafting team] chose the four-hour timeframe in 
consideration of generators that typically do not commit during 
freezing conditions but are running when conditions drop below freezing 
for a short period of time . . . '' \87\ Lastly, NERC states that the 
language is intended to act as a ``blanket inclusion of all [bulk 
electric system] resources that serve Balancing Authority load for a 
period of more than four hours in freezing conditions.'' \88\
---------------------------------------------------------------------------

    \86\ NERC Petition, Ex. C-2, Technical Rationale and 
Justification for EOP-012-1 at 1.
    \87\ Id.
    \88\ Id. at 2.
---------------------------------------------------------------------------

    55. Despite this additional description regarding the standard 
drafting team's intent, we are concerned that certain elements of the 
applicability criteria remain unclear and ambiguous. For example, in 
light of the multiple different approaches for participating in 
electricity markets, it may not be clear under what circumstances a 
generator owner is ``obligated to serve a Balancing Authority load.'' 
\89\ Similarly, while the intent appears to be to exclude units that do 
not typically run during winter, it is unclear how the qualifier of 
``for four hours or more'' is meant to be measured and applied in 
practice.
---------------------------------------------------------------------------

    \89\ Id. at 1.
---------------------------------------------------------------------------

    56. We find that NERC has not sufficiently supported the 
applicability criteria of EOP-012-1. Reliability Standard EOP-012-1 
applies only to ``[a] Blackstart Resource'' or ``[a] Bulk Electric 
System generating unit that commits or is obligated to serve . . . 
pursuant to a tariff obligation, state requirement . . . , or other 
contractual arrangement, rule, or regulation, for a continuous run of 
four hours or more at or below a temperature of 32 degrees Fahrenheit 
(zero degrees Celsius). . . .'' \90\ This applicability is further 
limited by enumerated exemptions set forth in section 4.2.2. NERC 
explains in its Petition that the Facilities section 4.2 of the 
Reliability Standard, that limits applicability to an unidentified 
subset of generating units, is meant to ``place the responsibility for 
cold weather preparedness on those generating units that are being 
depended on to operate in cold weather and on which the reliability of 
the system depends, while avoiding undue burden on those generating 
units that are not expected to operate in cold weather.'' \91\ But 
based on commenter concerns and our reading of the plain text of the 
Reliability Standard, the extent of Reliability Standard EOP-012-1's 
applicability to bulk electric system facilities is unclear.
---------------------------------------------------------------------------

    \90\ Reliability Standard, EOP-012-1, section 4.2.
    \91\ NERC Petition at 30.
---------------------------------------------------------------------------

    57. For example, it is unclear how the term ``continuous run'' 
would apply to intermittent resources, which by their nature are 
variable and, therefore, do not always run continuously. Ensuring clear 
applicability to intermittent generators is critical to ensuring that 
enough generating units are available during cold temperatures.
    58. Moreover, to the extent it is NERC's intent to exclude units 
that do not typically run during winter from every requirement in the 
Standard, we have concerns that this is not clearly articulated in 
Reliability Standard EOP-012-1. In short, we are concerned that use of 
the terms ``continuous run,'' ``commits or is obligated to serve'' and 
``four hours or more,'' as well as the enumerated exemptions, 
obfuscates the extent of applicability of Reliability Standard EOP-012-
1 and may not ensure that compliance is required for all ``generating 
units that are being depended on to operate in cold weather and on 
which the reliability of the system depends.'' \92\ Therefore, we 
direct NERC, pursuant to FPA section 215(d)(5), to modify Reliability 
Standard EOP-012-1 to ensure that it captures all bulk electric system 
generation resources needed for reliable operation and excludes only 
those generation resources not relied upon during freezing 
conditions.\93\ As the directive is to clarify the language of the 
applicability section to align with NERC's explanation of the entities 
that should comply, there should be no need for additional 
implementation time. Therefore, NERC should ensure the modified 
applicability is implemented as of the effective date of Reliability 
Standard EOP-012-1.
---------------------------------------------------------------------------

    \92\ Id. at 30.
    \93\ 16 U.S.C. 824o(d)(5) (stating that the Commission, ``upon 
its own motion or upon complaint, may order the Electric Reliability 
Organization to submit to the Commission a proposed reliability 
standard or a modification to a reliability standard that addresses 
a specific matter if the Commission considers such a new or modified 
reliability standard appropriate to carry out this section'').
---------------------------------------------------------------------------

    59. Given the lack of clarity in the proposed applicability 
criteria for EOP-012-1, we are concerned that the standard could apply 
to significantly fewer generators than the existing Reliability 
Standard EOP-011-2 Requirements R7 and R8. Thus, as Reliability 
Standard EOP-011-2 requirements to implement and maintain cold weather 
preparedness plan(s) and associated training applies to all bulk 
electric system generating units, we defer our decision on whether to 
approve or modify NERC's proposed implementation date for Reliability 
Standard EOP-011-3 (and proposed retirement of Reliability Standard 
EOP-011-2) until NERC submits its revised applicability section for 
EOP-012. Allowing these requirements to remain mandatory and 
enforceable will ensure all bulk electric system generating units are 
required to maintain cold weather preparedness plans until such time as 
the revised applicability criteria are effective for EOP-012.
    60. Furthermore, we are concerned that the proposed applicability 
criteria for EOP-012-1 and retirement of EOP-011-2 Requirements R7 and 
R8 will eliminate valuable information on cold weather preparedness of 
generating units that typically do not operate during the winter. Under 
EOP-011-2, all bulk electric system generating units must identify in 
cold weather preparedness plan(s) ``[g]enerating unit(s) cold weather 
data'' including ``[g]enerating unit(s) operating limitations in cold 
weather'' and

[[Page 15003]]

``[g]enerating unit(s) minimum . . . design temperature . . . 
historical operating temperature . . . or current cold weather 
performance temperature determined by an engineering analysis.'' This 
data is to be exchanged with the reliability coordinator, transmission 
operator, and balancing authority for planning and operations. The 
November 2021 Report stated that ``[t]he intent behind requiring 
[generator owners] to identify and share with the [balancing 
authorities] and [transmission operators] the expected limitations of 
their generating units `during local forecasted cold weather,' is to 
prevent grid operators from being surprised when large numbers of 
generating units that had committed to run are unable to do so during 
cold weather events.'' \94\ Once EOP-012-1 goes into effect, and EOP-
011-2 Requirements R7 and R8 are retired, we are concerned that 
generating units that do not typically operate during the winter will 
no longer provide this information to reliability coordinators, 
transmission operators, and balancing authorities. The loss of this 
information concerns us as the proposed applicability of EOP-012-1 
recognizes that units that do not typically run during the winter may 
be called upon during emergencies. We therefore direct NERC to modify 
EOP-012-1 to ensure that this information remains available.
---------------------------------------------------------------------------

    \94\ November 2021 Report at 190-91.
---------------------------------------------------------------------------

3. The Allowance of Exceptions for Generator Owner-Defined Technical, 
Commercial, or Operational Constraints
a. NERC Petition
    61. Requirement R1 of EOP-012-1 requires a generator owner to 
either implement freeze protection measures on its existing units that 
provide capability to operate for a period of not less than 12 
continuous hours at the Extreme Cold Weather Temperature for the unit 
or ``[e]xplain in a declaration any technical, commercial, or 
operational constraints that preclude the ability'' to comply with the 
requirement.\95\ Similarly, Requirement R7 mandates that a generator 
owner implement each corrective action plan developed pursuant to 
Requirements R2, R4, or R6 ``or explain in a declaration why corrective 
actions are not being implemented due to any technical, commercial, or 
operational constraint as defined by the Generator Owner.'' \96\
---------------------------------------------------------------------------

    \95\ NERC Petition Ex A-2, at 4.
    \96\ Id. at 4-6.
---------------------------------------------------------------------------

b. Comments
    62. Several commenters assert that the Requirements R1 and R7 in 
Reliability Standard EOP-012-1 could benefit from increased clarity. 
EPSA/PJM Group, NEPGA, and the ISO/RTO Council assert that the 
generator owner declaration of constraints outlined in Requirement R1 
and Requirement R7 are overly broad and that there is no explanation of 
what technical, commercial, or operational constraints would be 
permissible for generator owners to avoid both the implementation of 
freeze protection measures and a corrective action plan.\97\ 
Specifically, EPSA/PJM Group contend that the broad discretion towards 
generator owners to identify constraints in Requirements R1 and R7 may 
lead to generator owners avoiding the implementation of freeze 
protection measures (to lower their costs), thereby negatively 
interfering with competition.\98\ The ISO/RTO Council states that this 
generator owner discretion to determine what constraints are valid 
without oversight could make enforcement difficult.\99\ Similarly, 
Invenergy argues that this discretion could lead to uneven 
implementation and enforcement.\100\ TCPA also requests that the 
Commission clarify that a lack of cost recovery is a commercial 
constraint to implementing Requirement R1 and R7.\101\ Finally, 
commenters point out that there is no indication in the Standard of 
which entity should receive the declaration of constraints from the 
generator owner, if any.\102\
---------------------------------------------------------------------------

    \97\ EPSA/PJM Group Comments at 7-9; ISO/RTO Council Comments at 
10; NEPGA Comments at 7-8.
    \98\ EPSA/PJM Group Comments at 7-9.
    \99\ ISO/RTO Council Comments at 10-11.
    \100\ Invenergy Comments at 8.
    \101\ TCPA Comments at 2-3, 7-8.
    \102\ E.g., ISO/RTO Council Comments at 10.
---------------------------------------------------------------------------

    63. NERC, in its reply comments, states that provisions criticized 
by commenters including the ``constraints'' provision represents a 
balancing of competing opinions raised in the standards development 
process. NERC opines that the petition provides a sound technical basis 
for approving the Standards as filed, and reiterates that during the 
second phase project, ``NERC may propose further changes to enhance the 
clarity or effectiveness of the EOP-012 standard.'' \103\
---------------------------------------------------------------------------

    \103\ NERC Reply Comments at 13.
---------------------------------------------------------------------------

c. Commission Determination
    64. We share commenters' concerns regarding the uncertainty created 
by the proposed technical, commercial, or operational constraint 
provisions in Requirements R1 and R7, and that without criteria to 
guide the generator owners, or guardrails on what constitutes a 
legitimate technical, commercial, or operational constraint, entities 
may either benefit financially by avoiding the purpose of the Standard 
altogether or have declarations without auditable elements.\104\ 
Indeed, instead of implementing freeze protection measures, Requirement 
R1 allows an entity to explain in a declaration the constraints that 
preclude the ability to comply. Requirement R7 allows an entity to 
explain in a declaration any technical, commercial, or operational 
constraints as defined by the generator owner that prevent its 
implementation of corrective actions set forth in a corrective action 
plan pursuant to Requirements R2, R4 and R6. We are also concerned that 
a generator owner may make the determination without informing planning 
and operational entities (i.e., the reliability coordinator or 
balancing authority) that are expecting the reliable operation of the 
generating unit to its Extreme Cold Weather Temperature.
---------------------------------------------------------------------------

    \104\ See, e.g., ISO/RTO Comments at 10 (cautioning that the 
``broad undefined `commercial' exemption could lead to the exception 
swallowing the rule'').
---------------------------------------------------------------------------

    65. The Commission has previously encountered similar concerns 
regarding the vagueness and enforceability of Reliability Standards 
language. For example, in Order No. 693 the Commission approved 
Reliability Standards while also expressing concern that the term 
``sabotage'' was too ambiguous.\105\ Similarly, in Order No. 791 
(approving Version 5 of the CIP Standards), the Commission raised 
concerns with vague language that required entities to ``identify, 
assess, and correct'' deficiencies. The Commission determined that the 
ambiguities resulted in an ``unacceptable amount of uncertainty'' and 
directed NERC to remove the ambiguous language and develop 
modifications within one year.\106\ In both Order No. 693 and Order No. 
791, the Commission approved NERC's proposed Reliability Standards as 
an improvement to reliability, while directing NERC to submit 
modifications to the Standards addressing the Commission's concern 
regarding vagueness of particular language. We conclude that a similar 
approach is appropriate in the immediate proceeding, given the 
improvements offered by Reliability Standard EOP-

[[Page 15004]]

012-1 in addressing Bulk-Power System reliability during extreme cold 
weather events.
---------------------------------------------------------------------------

    \105\ Order No. 693, 118 FERC ] 61,218 at PP 1, 461.
    \106\ See Order No. 791, 145 FERC ] 61,160 at PP 49-53, 67, 69.
---------------------------------------------------------------------------

    66. Accordingly, we direct NERC, pursuant to section 215(d) of the 
FPA, to develop and submit modifications to Reliability Standard EOP-
012-1 Requirements R1 and R7 to address concerns related to the 
ambiguity of generator-defined declarations of technical, commercial, 
or operational constraints that preclude a generator owner from 
implementing the appropriate freeze protection measures and to ensure 
that the constraint declarations may not be used to opt-out of 
compliance with the Standard or obligations set forth in a corrective 
action plan. Specifically, we direct NERC to include auditable criteria 
on permissible constraints and to identify the appropriate entity that 
would receive the generator owners' constraint declarations under EOP-
012-1 Requirements R1 and R7. We direct NERC to submit the revised 
Reliability Standard no later than 12 months after the date of issuance 
of this order.
    67. TCPA requests that the Commission clarify that a ``lack of cost 
recovery'' is a commercial constraint to implementing Requirement R1 
and R7.\107\ TCPA argues that the ability of transmission service 
providers and others to receive regulated rates of return creates an 
uneven playing field for independent generation.\108\ We decline to 
grant TCPA's proposed clarification. Granting TCPA's requested 
clarification would be tantamount to a blanket waiver for all 
generators that do not currently recover their costs through cost-of-
service rates.\109\ We believe it would be inappropriate to allow 
entities participating in competitive wholesale electric markets to 
simply opt-out of reliability improvements offered by NERC's proposal 
because they lack a dedicated cost recovery mechanism.
---------------------------------------------------------------------------

    \107\ TCPA Comments at 2-3, 7-8 (recommending that commercial 
constraints be expanded to include economic issues).
    \108\ Id. at 2.
    \109\ This order discusses cost recovery mechanisms in more 
detail in section 5.
---------------------------------------------------------------------------

    68. Additionally, to provide the Commission with an ongoing 
assessment of the risk to the Bulk-Power System, we direct that NERC 
assess the implementation of the declarations through annual 
informational data submittals filed with the Commission, discussed in 
more detail in section 8.
4. The Calculation of the Extreme Cold Weather Temperature at Which a 
Generating Unit Must Be Capable of Performing
a. NERC Petition
    69. NERC proposes to define the term Extreme Cold Weather 
Temperature as equal to the lowest 0.2 percentile of the hourly 
temperatures measured in December, January, and February from January 
1, 2000, through the date the temperature is calculated.\110\ According 
to NERC, a statistical approach using modern weather data would advance 
the reliability of the Bulk-Power System while also avoiding being 
overly burdensome for those responsible for compliance.\111\
---------------------------------------------------------------------------

    \110\ Id. at 24.
    \111\ Id. at 25-27 (relying on the Modernization and Associated 
Restructuring from the National Weather Service, which has higher 
quality, more granular temperature data in more locations).
---------------------------------------------------------------------------

b. Comments
    70. Some commenters express concern with the Extreme Cold Weather 
Temperature definition.\112\ The ISO/RTO Council argues that only 
examining historical data from the year 2000 forward risks 
unnecessarily limiting the range of possible cold weather scenarios 
that the Standard is intended to address, and proposes an alternate 
calculation method.\113\ NEPGA/EPSA/PJM Group counters that the ISO/RTO 
Council's proposed revisions materially change Reliability Standard 
EOP-012-1, and should the Commission adopt the ISO/RTO proposal, then 
efforts to comply with EOP-012-1 ``as drafted'' could be potentially 
futile.\114\ Invenergy asserts that the Extreme Cold Weather 
Temperature definition is arbitrary because NERC did not measure the 
definition against any objective standard to ensure reliable 
operation.\115\ Invenergy adds that the Extreme Cold Weather 
Temperature should be calculated by NERC and its Regional Entities to 
prevent uneven implementation and enforcement.\116\ Invenergy also 
argues that it is unreasonable that the proposed Extreme Cold Weather 
Temperature ``will be heavily influenced by the colder nighttime 
temperatures, when there is no solar generation.'' \117\
---------------------------------------------------------------------------

    \112\ NEPGA/EPSA/PJM Group Answer at 3-4; ISO/RTO Comments at 6.
    \113\ ISO/RTO Council Comments at 7-9.
    \114\ NEPGA/EPSA/PJM Group Answer at 3-8 (requesting that the 
Commission not adopt the ISO/RTO Council's alternative Extreme Cold 
Weather Temperature proposal).
    \115\ Invenergy Comments at 7-8.
    \116\ Id. at 8.
    \117\ Id. at 7-8.
---------------------------------------------------------------------------

c. Commission Determination
    71. As noted above, the Extreme Cold Weather Temperature is equal 
to the lowest 0.2 percentile of the hourly temperatures measured in 
December, January, and February from January 1, 2000, through the date 
the temperature is calculated.\118\ This method of determining the 
Extreme Cold Weather Temperature is a statistical approach, using the 
cumulative distribution of historical temperatures to determine the 0.2 
percentile historical temperature. NERC's petition explains it relied 
on the Modernization and Associated Restructuring from the National 
Weather Service, which has higher quality and more granular temperature 
data in more locations, being completed in the year 2000 to justify the 
elimination of all pre-2000 historical weather data from 
consideration.\119\
---------------------------------------------------------------------------

    \118\ NERC Petition at 24.
    \119\ Id. at 25-27.
---------------------------------------------------------------------------

    72. We find that NERC's Extreme Cold Weather Temperature definition 
represents a reasonable starting point for reducing the level of risk. 
The use of the Extreme Cold Weather Temperature to establish a specific 
level of required freeze protection for resources is also a significant 
improvement over the current cold weather Reliability Standards, which 
contain no minimum temperature operating requirements.\120\ With 
respect to the 0.2 threshold, we believe that NERC reasonably balanced 
a number of competing factors in setting the Extreme Cold Weather 
Temperature.\121\ Similarly, while we agree with the ISO/RTO Council 
that additional data sources may be available, we find that NERC's 
consideration of data availability and its determination to rely on 
meteorological data starting in the year 2000 is reasonable. Similarly, 
as the Extreme Cold Weather Temperature definition is meant to apply 
uniformly regardless of generation type, we do not find it unreasonable 
that solar generators would need to meet an Extreme Cold Weather 
Temperature based on 24-hour-temperature data.\122\
---------------------------------------------------------------------------

    \120\ See Order Approving Cold Weather Reliability Standards, 
176 FERC ] 61,119, at P 1.
    \121\ NERC Petition at 130 (relying on this approach to ensure 
that the Extreme Cold Weather Temperature does not result in an 
overly conservative design or preclude the generator owner from 
using historical operating data to show compliance).
    \122\ See Invenergy Comments at 7-8.
---------------------------------------------------------------------------

    73. Although we agree that NERC could have adopted other, 
potentially more robust approaches to defining the Extreme Cold Weather 
Temperature, we believe that other factors such as application, 
inspection, and

[[Page 15005]]

maintenance of the freeze protection measures and the associated 
training of generator owners or generator operators that perform these 
actions (all of which are requirements in the proposed Standard) should 
reasonably improve reliable operation of the Bulk-Power System. 
Further, recognizing that extreme cold weather temperatures could drop 
below the Extreme Cold Weather Temperature during future events, the 
need for periodic Extreme Cold Weather Temperature review \123\ and 
updates \124\ based on the new cold weather temperatures will help 
mitigate freezing issues over time, which could lessen the risk of 
freeze-related outages not being subject to corrective action plans.
---------------------------------------------------------------------------

    \123\ Reliability Standard EOP-012-1 already mandates a five-
year Extreme Cold Weather Temperature re-calculation and updates to 
corrective actions where warranted.
    \124\ The proposed Standard requires updates regardless of the 
Extreme Cold Weather Temperature methodology used.
---------------------------------------------------------------------------

    74. Accordingly, we are not persuaded by commenters that 
modification to NERC's Extreme Cold Weather Temperature definition is 
warranted at this time. Nevertheless, based on the concerns expressed 
above, we direct that NERC assess the implementation of the definition 
through event-based informational data submittals filed with the 
Commission, discussed in more detail in section 8. Based on the results 
of NERC's informational data submittals to the Commission, the 
Commission will determine whether future modification to the Extreme 
Cold Weather Temperature definition is warranted.
5. The Absence of a Deadline by Which Generator Owners Must Implement 
the New or Modified Freeze Protection Measures Required by Their 
Corrective Action Plans
a. NERC Petition
    75. Requirement R7 of EOP-012-1 mandates that a generator owner 
implement each corrective action plan developed pursuant to 
Requirements R2, R4, or R6, or ``explain in a declaration why 
corrective actions are not being implemented due to any technical, 
commercial, or operational constraint as defined by the Generator 
Owner.'' \125\ Requirement R7 also requires that the generator owner 
update each corrective action plan if the actions or timetables change, 
until the corrective action plan implementation is completed. But 
Reliability Standard EOP-012-1 does not include a deadline for the 
implementation completion of such plans.
---------------------------------------------------------------------------

    \125\ NERC Petition at 43.
---------------------------------------------------------------------------

b. Comments
    76. Some commenters express concern with Requirement R7 and the 
implementation timeline for generator owner-developed corrective action 
plans.\126\ Specifically, the ISO/RTO Council requests modification 
because Requirement R7 does not explain when the implementation of the 
developed corrective action plans should occur.\127\ The ISO/RTO 
Council also argues that it is unclear to which entity or entities the 
generator owner is supposed to provide its corrective action plan.\128\ 
TCPA asserts that it is unclear from EOP-012-1 when the corrective 
actions outlined in the developed corrective action plans should be 
completed.\129\
---------------------------------------------------------------------------

    \126\ See, e.g., ISO/RTO Council Comments at 10-11; TCPA 
Comments at 4, 6.
    \127\ ISO/RTO Council Comments at 11.
    \128\ Id. at 10.
    \129\ TCPA Comments at 6.
---------------------------------------------------------------------------

c. Commission Determination
    77. The NERC Glossary defines a ``corrective action plan'' as used 
in EOP-012-1 as a ``list of actions and an associated timetable for 
implementation to remedy a specific problem.'' \130\ As such, the 
``corrective action plan[s]'' in EOP-012-1 are required to contain a 
timetable for implementation completion and entities are required to 
implement actions consistent with the timelines defined in the 
corrective action plan under Requirement R7. While entities are 
required to adhere to the timelines as defined in their corrective 
action plans, some Reliability Standards establish a maximum time for 
completion while others do not. For example, the Commission directed 
NERC to add specific timelines for the completion of corrective action 
plans to mitigate geomagnetic disturbances in Reliability Standard TPL-
007-1 (Transmission System Planned Performance for Geomagnetic 
Disturbance Events).\131\ In contrast, the Commission has approved 
other Reliability Standards requiring a corrective action plan that do 
not require a specific deadline for the completion of the corrective 
action plan.\132\
---------------------------------------------------------------------------

    \130\ NERC Petition at 1013.
    \131\ Reliability Standard for Transmission Sys. Planned 
Performance for Geomagnetic Disturbance Events, Order No. 830, 156 
FERC ] 61,215, at PP 101-04 (2016), reh'g denied, Order No. 830-A, 
158 FERC ] 61,041 (2017) (directing NERC to modify TPL-007-1 to 
include a two-year deadline after the development of a CAP to 
complete the implementation of non-hardware mitigation and a four-
year deadline to complete hardware mitigation).
    \132\ See, e.g., PRC-004-6 (Protection System Misoperation 
Identification and Correction), Requirement R5 (requiring each 
transmission owner, generator owner, and distribution owner that 
owns a protection system component that caused misoperation to 
develop a corrective action plan or explain in declaration why 
corrective actions are beyond the entity's control).
---------------------------------------------------------------------------

    78. In this instance, despite the lack of a deadline for 
completion, we find it appropriate to approve the Standard while also 
directing modification. We are persuaded that modifying the Standard to 
include a maximum time for implementation completion is reasonable for 
several reasons. First, having a requirement to implement a corrective 
action plan by a date certain will provide a significant level of risk 
reduction compared to the status quo. Second, the requirement to 
implement a corrective action plan and to identify any temporary 
operating limitations or effects to the cold weather preparedness plan 
that would apply to entities until the execution of the corrective 
actions by a date certain is an improvement to the Reliability 
Standards.\133\ Finally, we do not find persuasive NERC's explanation 
that competition for expert resources and supply chain challenges may 
make setting a specific, uniform corrective action plan timeline for 
all generating units difficult. The November 2021 Report recommends 
that NERC's standard drafting team establish a maximum date that 
corrective action plans must be completed.\134\ Otherwise, without a 
maximum time for implementation, we are concerned that the time it 
takes to complete the corrective action plans could allow identified 
issues to remain unresolved for a significant period.
---------------------------------------------------------------------------

    \133\ Id. Ex. A-2 at 6-7.
    \134\ November 2021 Report at 187 (Key Recommendation 1d).
---------------------------------------------------------------------------

    79. Accordingly, we direct NERC pursuant to FPA section 215(d)(5) 
to modify Reliability Standard EOP-012-1 to address concerns related to 
the lack of an implementation timeframe for corrective action plans. 
Specifically, we direct NERC to include in the Standard a deadline or 
maximum period for the implementation completion of corrective action 
plans under the Standard. We direct NERC to submit the revised 
Reliability Standard no later than 12 months after the date of issuance 
of this order.
6. Cost Recovery Mechanisms
a. NERC Petition
    80. Reliability Standard EOP-012-1 does not address cost recovery 
mechanisms. However, NERC's petition

[[Page 15006]]

recognizes that generator owners can recover costs through markets or 
cost recovery mechanisms approved by the state public utility 
commissions.\135\
---------------------------------------------------------------------------

    \135\ NERC Petition at 44 (citing to November 2021 Report at 
191-92).
---------------------------------------------------------------------------

b. Comments
    81. Some commenters assert that Reliability Standard EOP-012-1 
should address cost recovery.\136\ TCPA asserts that the lack of a cost 
recovery for competitive generators is a commercial constraint to 
compliance with EOP-012-1 and requests that the Commission say so in 
its order.\137\ The ISO/RTO Council asks the Commission to remove the 
commercial constraint option from EOP-012-1 altogether.\138\ Invenergy 
argues that the November 2021 Report recognized that generators should 
be compensated for retrofits and that, while the NERC Reliability 
Standards process may not be the appropriate forum to address cost 
recovery, it is now incumbent on the Commission to address cost 
recovery for generators required to comply with EOP-012-1.\139\ NEPGA 
contends that a market change or other cost recovery mechanism must be 
in place by the effective date of Reliability Standard EOP-012-1 and 
asks the Commission to recognize the FPA's cost recovery 
allowances.\140\ EPSA/PJM Group ask that the Commission begin a 
proceeding under section 206 to address cost recovery for compliance 
with Reliability Standards.\141\
---------------------------------------------------------------------------

    \136\ See, e.g., EPSA/PJM Group Comments at 10-13.
    \137\ TCPA Comments at 2.
    \138\ ISO/RTO Council Comments at 10.
    \139\ Invenergy Comments at 11-13.
    \140\ NEPGA Comments at 2, 4-6.
    \141\ EPSA/PJM Group Comments at 11, 13 (proffering that the 
Commission could issue a show cause order pursuant to FPA section 
206 to ensure that each ISO and RTO have cost recovery mechanisms in 
place).
---------------------------------------------------------------------------

    82. NERC and APPA/TAPS assert that cost recovery is outside the 
scope of what Reliability Standards can address.\142\ Specifically, 
APPA/TAPS contend that the Commission should not act in this proceeding 
to provide competitive generators with a mechanism to recover cold 
weather Standard compliance costs because the FPA does not mandate 
special cost recovery mechanisms for competitive generators' section 
215 compliance costs.\143\ APPA/TAPS state that adopting a separate 
cost recovery mechanism for competitive generators' reliability 
compliance costs would be inconsistent with the Commission's market-
based framework and could risk undercutting competitive markets.\144\
---------------------------------------------------------------------------

    \142\ NERC Reply Comments at 10; APPA/TAPS Answer at 2-9.
    \143\ APPA/TAPS Answer at 2-8.
    \144\ Id. at 8-9.
---------------------------------------------------------------------------

c. Commission Determination
    83. We find that the question of whether existing market mechanisms 
provide an opportunity to recover the prudently incurred costs of 
compliance with the proposed Standard and the request to initiate a 
proceeding under FPA 206 are outside the scope of the instant 
proceeding.
7. Other Technical Matters
a. Comments
    84. Commenters raise other technical concerns touching on a variety 
of elements of the Standard. For example, the ISO/RTO Council argues 
that NERC's implementation plan may ``discourage earlier compliance'' 
and that the Commission should enact a shorter implementation plan 
along with an exception process for generator owners that may 
``legitimately need more time.'' \145\ The ISO/RTO Council recommends 
revising the ``Generator Cold Weather Reliability Event'' definition to 
account for generating units rated at or below 200 MW.\146\ The ISO/RTO 
Council also expresses concern that corrective action plans under the 
Standard only apply when the unit is unable to operate at or above the 
Extreme Cold Weather Temperature.\147\ Additionally, the ISO/RTO 
Council questions how EOP-012-1 interacts with tariff 
requirements.\148\
---------------------------------------------------------------------------

    \145\ ISO/RTO Council Comments at 15-16.
    \146\ Id. at 16-17.
    \147\ Id. at 11-12.
    \148\ Id. at 13-15.
---------------------------------------------------------------------------

    85. EPSA/PJM Group requests that Requirements R1 and R2 be removed 
from EOP-012-1 and be replaced with a requirement that balancing 
authorities instead ensure weather-resilient generation.\149\ For 
Reliability Standard EOP-012-1 Requirement R1, TAPS requests that 
compliance with the phrase ``provide the capability to operate'' be 
based on sound engineering judgment, meaning subsequent failures during 
cold weather not automatically lead to a violation since cold weather 
events cannot be simulated ahead of time.\150\
---------------------------------------------------------------------------

    \149\ EPSA/PJM Comments at 2.
    \150\ TAPS Comments at 5-6.
---------------------------------------------------------------------------

    86. TCPA requests clarification of when the five-year clock in 
Requirement R4 begins and explanation how Requirement R7 requirement 
for corrective action plans could be effective 18 months after 
government approval when the standards for which the corrective action 
plans would address (i.e., Requirements R2 and R4) are not effective 
until 60 and 78 months after government approval.\151\ TCPA suggests 
that generator owners only be required to provide annual compliance 
progress reports.\152\ TCPA also raises issue with EOP-012-1's 
violation severity level's lack of differentiation between single and 
multiple facilities.\153\ Invenergy suggests revising NERC's 
``Generator Cold Weather Reliability Event'' definition to align better 
with the bulk electric system definition to ensure that corrective 
action plans are only required when an actual Cold Weather Reliability 
Event occurs.\154\ Invenergy and TCPA recommend eliminating the term 
``continuous'' from EOP-012-1 Requirement R1 to reflect variable 
generation and that solar and wind plants are unable to operate 
continuously.\155\
---------------------------------------------------------------------------

    \151\ TCPA Comments at 6.
    \152\ Id.
    \153\ Id. at 7.
    \154\ Invenergy Comments at 2, 5-6.
    \155\ Id. at 2, 9-10; TCPA Comments at 5.
---------------------------------------------------------------------------

    87. NERC asserts that it is presently in phase two of its standard 
development process and that its standard drafting team is presently 
considering many of the issues raised in connection with this 
proceeding.\156\ NERC encourages commenters in this proceeding to 
continue participating in NERC's standard development process so that 
their issues and concerns can be addressed.
---------------------------------------------------------------------------

    \156\ NERC Reply Comments at 13.
---------------------------------------------------------------------------

b. Commission Determination
    88. We share concerns with commenters regarding the implementation 
period of Reliability Standard EOP-012-1, although we acknowledge 
NERC's assertion that the time is necessary for generator owners to 
calculate the Extreme Cold Weather Temperature for each generating 
unit, to identify Generator Cold Weather Critical Components, and to 
perform the necessary engineering studies and analyses to identify and 
implement freeze protection measures that would provide for the 
required performance capability or to explain why such measures are 
precluded by technical, commercial, or operational constraints. To 
address these concerns, we direct NERC to revise EOP-012 to require a 
shorter implementation period and staggered implementation for unit(s) 
in a generator owner's fleet.\157\ Such an approach will reduce 
reliability risks more quickly. Although we are giving

[[Page 15007]]

NERC the discretion to determine what the effective date should be 
shortened to, we also emphasize that industry has been aware of and 
alerted to the need to prepare their generating units for cold weather 
since at least 2011. NERC should consider the amount of time that 
industry has already had to implement freeze protection measures when 
determining the appropriate shorter implementation period. We direct 
NERC to submit the revised implementation to Reliability Standard EOP-
012-1 no later than 12 months after the date of issuance of this order.
---------------------------------------------------------------------------

    \157\ See, e.g., 146 FERC ] 61,213 at PP 1-2 (approving 
Reliability Standard MOD-025-2 and its associated staggered 
implementation plan).
---------------------------------------------------------------------------

    89. For comments related to the ``continuous'' operation 
requirements of EOP-012-1, the Reliability Standard is clear that it 
requires generating units to be ``capable'' of operating continuously 
for 12 hours, and not that the units must actually operate when they 
would otherwise not be expected to operate. NERC states in its petition 
that the 12-hour requirement is a minimum.\158\ However, we find the 
phrase ``continuous operation'' to be confusing and subject to 
conflicting interpretations. We also note that it creates confusion as 
to whether certain generating units can ever be capable of compliance. 
As Invenergy states, ``solar generators are not capable of operating in 
a 12-hour period that extends beyond daylight hours, and, typically 
when there are freezing temperatures, the sun does not even shine for 
12 hours.'' \159\ And while Invenergy states that the ``Standard 
Drafting Team indicated that the freeze protection measures must 
provide the level of protection that would allow for 12 continuous 
hours if the sun were to shine or the wind were to blow for the 
period,'' \160\ the Reliability Standard Requirements in EOP-012-1 do 
not specify that.\161\ Thus, we direct NERC to modify the Standard to 
clarify Reliability Standard EOP-012-1 Requirement R1 to ensure that 
generators that are technically incapable of operating for 12 
continuous hours (e.g., solar facilities during winter months with less 
than 12 hours of sunlight) are not excluded from complying with the 
Standard. We direct NERC to submit the revised Reliability Standard no 
later than 12 months after the date of issuance of this order.
---------------------------------------------------------------------------

    \158\ Reliability Standard EOP-012-1 does not restrict longer 
duration commitments of generating units, whether based on tariff 
commitments, emergencies, or other conditions. See NERC Petition Ex. 
C-2 at 5 (explaining that the intent of Requirement R1 is to 
implement freeze protection measures such that facilities are 
capable of continuous operation for not less than 12 hours) 
(emphasis added).
    \159\ Invenergy Comments at 9.
    \160\ Id.
    \161\ Order No. 693, 118 FERC ] 61,218 at P 253 (``The most 
critical element of a Reliability Standard is the Requirements. As 
NERC explains, `the Requirements within a standard define what an 
entity must do to be compliant . . . [and] binds an entity to 
certain obligations of performance under section 215 of the FPA.' 
'').
---------------------------------------------------------------------------

    90. We also find that the one-hour continuous operations 
requirement in Reliability Standard EOP-012-1 Requirement R2 is too 
short of a period to adequately meet the purpose of the Standard to 
ensure generating units ``mitigate the reliability impacts of extreme 
cold weather.'' \162\ Thus, we direct NERC to modify the one-hour 
continuous operations requirement of Reliability Standard EOP-012-1 
Requirement R2 to better align with the stated purpose of the 
Reliability Standard EOP-012-1. We direct NERC to submit the revised 
Reliability Standard no later than 12 months after the date of issuance 
of this order.
---------------------------------------------------------------------------

    \162\ NERC Petition at 29 (noting that freeze protection 
measures of the Standard would advance the reliability of the Bulk-
Power System by helping to improve generator reliability in cold 
weather).
---------------------------------------------------------------------------

    91. We find that it is premature to address TCPA's recommendation 
that generator owners only submit annual progress reports on 
compliance.\163\ Nothing in proposed Reliability Standard EOP-012-1 
mandates the submission of compliance reports and we are already 
directing NERC to address periodic data submittals in this order.
---------------------------------------------------------------------------

    \163\ TCPA Comments at 5.
---------------------------------------------------------------------------

    92. Finally, for suggested revisions to NERC's ``Generator Cold 
Weather Reliability Event'' definition to align better with the bulk 
electric system definition, and requests that Requirements R1 and R2 be 
removed from EOP-012-1 and be replaced with a requirement that 
balancing authorities instead ensure weather-resilient generation,\164\ 
we decline to direct such modifications at this time.
---------------------------------------------------------------------------

    \164\ EPSA/PJM Comments at 2.
---------------------------------------------------------------------------

8. Annual and Event-Based Data Submittals
    93. NERC states that it plans to address data submittal 
requirements in phase two of its standard development process.\165\ We 
find that such data submittals are essential to assess the performance 
of the Standards towards assuring the reliability of the Bulk-Power 
System. Specifically, we find that additional data and analysis is 
necessary to address the uncertainty created by the proposed technical, 
commercial, or operational constraint provisions, as discussed above in 
section 3. This data and analysis are essential to assess how the 
generating units' freeze protection measures (implemented to provide 
capability to operate at the Extreme Cold Weather Temperature) perform 
in future extreme cold weather events, as discussed above in section 4.
---------------------------------------------------------------------------

    \165\ NERC Petition at 54-55.
---------------------------------------------------------------------------

    94. Accordingly, we direct that NERC, pursuant to section 39.2(d) 
of the Commission's regulations, work with Commission staff to develop 
and submit a plan within 12 months of the issuance of this order 
explaining how it will gather data and submit an analysis that will 
allow the Commission to understand the efficacy of, and monitor the 
ongoing risk posed by: (1) proposed technical, commercial, or 
operational constraint provisions in EOP-012-1, Requirements R1, R6, 
and R7; and (2) actual performance of freeze protection measures during 
future extreme cold weather events.
    95. Regarding the proposed technical, commercial, or operational 
constraint provisions in EOP-012-1, Requirements R1, R6, and R7, NERC 
should work with Commission staff on the details of timing and what to 
include in its plan, which, at a minimum, should include collection of 
the following data: (1) the generating units that have declared 
constraints under EOP-012-1 and the megawatts of generation that they 
represent, organized by fuel type; (2) the megawatts of generation for 
which declarations have been made for each type of constraint 
(technical, commercial, or operational), organized by fuel type; (3) 
the rationale(s) for each declaration; (4) the megawatts of generation 
within the generation owner/operator's fleet currently capable of 
operating at each unit's Extreme Cold Weather Temperature; (5) the 
projected megawatts for which the generator owner/operator expects to 
complete corrective action plans for each year; (6) the projected 
megawatts for which the generator owner/operator expects to implement 
corrective action plans for each year; and (7) the megawatts of 
generating units identified as ``similar equipment'' \166\ to which the 
generator owner has determined that the cause(s) for the Generator Cold 
Weather Reliability Event are also applicable, under R6.2, while also 
identifying any similar equipment that will receive a declaration. To 
provide the Commission with an ongoing assessment of the risk to the 
Bulk-Power System, NERC's plan should include an annual informational 
filing to the Commission beginning 12 months after the mandatory and 
enforceable date of the Standard. The informational filing should 
include data on the seven foregoing categories aggregated at an 
appropriate level (e.g.,

[[Page 15008]]

Regional Entity, balancing authority, etc.), and an analysis of the 
efficacy of the requirements of the Standard based on the data. 
Depending on the results of NERC's data collection and analysis, the 
Commission will determine whether further modifications are needed to 
the Standard.
---------------------------------------------------------------------------

    \166\ For example, wind or solar equipment.
---------------------------------------------------------------------------

    96. NERC's plan should also include how it will analyze the 
performance of generating units' freeze protection measures 
(implemented to provide capability to operate at the Extreme Cold 
Weather Temperature) in future extreme cold weather events. Depending 
on the results of NERC's data collection and analysis, the Commission 
will determine whether further modifications are needed to the 
definitions or the Standard.

IV. Information Collection Statement

    97. The information collection requirements contained in this Final 
Rule are subject to review by the Office of Management and Budget (OMB) 
under section 3507(d) of the Paperwork Reduction Act of 1995.\167\ 
OMB's regulations require approval of certain information collection 
requirements imposed by agency rules.\168\ Upon approval of a 
collection of information, OMB will assign an OMB control number and 
expiration date. Comments on the collection of information are due 
within 60 days of the date this order is published in the Federal 
Register. 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.
---------------------------------------------------------------------------

    \167\ 44 U.S.C. 3507(d).
    \168\ 5 CFR 1320 (2021).
---------------------------------------------------------------------------

    98. The EOP Standards are currently located in the FERC-725S (OMB 
Control No. 1902-0270) collection. The collection is currently approved 
by OMB and contains Reliability Standards EOP-010-1, EOP-011-1, EOP-
004-4, EOP 005-3, EOP-006-3, EOP-008-2 (Table 1). In Docket No. RD23-1-
000, the Commission proposes to replace the current OMB approved 
Reliability Standard EOP-011-1 \169\ with Reliability Standard EOP-011-
3 (Table 2) and add a new information collection line item for 
Reliability Standard EOP-012-1 (Table 3).
---------------------------------------------------------------------------

    \169\ The currently OMB approved FERC-725S includes the burden 
related to Reliability Standard EOP-011-1. Reliability Standard EOP-
011-1 was superseded by Reliability Standard EOP-011-2, which was 
approved by the Commission in Docket No. RD21-5-000 (issued August 
24, 2021). Reliability Standard EOP-011-3, as noted in Docket No. 
RD23-1-000, will supersede Reliability Standard EOP-011-2; thus, the 
burdens resulting from Reliability Standard EOP-011-3 will be 
reflected in the FERC-725S information collection.
---------------------------------------------------------------------------

    99. The number of respondents below is based on an estimate of the 
NERC compliance registry for balancing authorities, transmission 
operators, generator operators, generator owners, and reliability 
coordinators. Reliability Standards EOP-011-3 and EOP-012-1 apply to 
balancing authorities, transmission operators, generator operators, and 
reliability coordinators. The Commission based its paperwork burden 
estimates on the NERC compliance registry as of November 4, 2022. 
According to the registry, there are 98 balancing authorities, 168 
transmission operators, 981 generator operators, 1,107 generator 
owners, and 12 reliability coordinators. The estimates in the tables 
below are based on the change in burden from the current EOP 
Reliability Standards to the Reliability Standards approved in this 
order. The Commission based the burden estimates in the tables below on 
staff experience, knowledge, and expertise.
    100. The estimates in the tables below are based, in combination, 
on one-time (years 1 and 2) and ongoing execution (year 3) obligations 
to follow the revised EOP Reliability Standards.
    101. The Reliability Standard EOP-011-3 modifications transfer 
Requirements R7 and R8 to Reliability Standard EOP-012-1, as described 
below. For Reliability Standard EOP-011-3, transmission operators and 
to a much lesser extent, balancing authorities, still have a one-time 
cost to modify existing operating plans based on revisions to 
Reliability Standard EOP-011-3 (Requirements R1 and R2) and to mitigate 
operating emergencies related to cold weather conditions. Additionally, 
reliability coordinators will need to review the modified operating 
plans of the transmission operators. In year three and ongoing, the 
transmission operator and reliability coordinator estimates are lower 
to reflect lower paperwork burden for upkeep and review of the 
operating plans for emergencies based on the modified Reliability 
Standard EOP-011-3 to ensure that the new requirements are in place and 
that applicable entities are following those plans.
    102. The new Reliability Standard EOP-012-1, which is applicable to 
1,107 generator owners and 981 generator operators, contains several 
new requirements and two requirements from Reliability Standard EOP-
011-2 that have been moved to Reliability Standard EOP-012-1. In year 
three and ongoing, the estimates are lower to reflect that the 
implementation plan(s) to mitigate the reliability effects of extreme 
cold weather conditions on generating units are in place and that 
entities are familiar with the EOP-012-1 requirements.
    103. Burden Estimates: The Commission estimates the changes in the 
annual public reporting burden and cost as indicated in the tables 
below:

[[Page 15009]]

                                                               Table 1--Current Costs and Burden Related to FERC-725S (1902-0270)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Annual number
  Reliability standard and  associated       Number of     of responses    Total number of       Average burden & cost per response      Total annual burden & total annual cost     Cost per
               requirement                  respondents   per respondent      responses                                                                                           respondent ($)
                                                     (1)             (2)    (1) * (2) = (3)  (4)......................................  (3) * (4) = (5).........................       (5) / (1)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
EOP-010-1...............................             181               1                181  20 hrs.; $1,660..........................  3,620 hrs.; $300,460....................          $1,660
EOP-011-1...............................              12               1                 12  1,500 hrs.; $124,500.....................  18,000 hrs.; $1,494,000.................         124,500
EOP-004-4, EOP-005-3, EOP-006-3, EOP-008-            280               1                280  250.58 \170\ hrs.; $20,798...............  70,162.4 hrs.; $5,234,440...............          20,798
 2.
                                         -------------------------------------------------------------------------------------------------------------------------------------------------------
    Total EOP...........................             473  ..............  .................  .........................................  91,782 hrs.; $7,028,900.................  ..............
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                          Table 2--Proposed Changes Due to Final Rule in Docket No. RD23-1-000
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         Number of
    Reliability standard &      Type\171\ and number      annual          Total number of        Average number of
          requirement                 of entity        responses per         responses           burden hours per             Total burden hours
                                                          entity                                  response \172\
                                (1).................             (2)  (1) * (2) = (3).......  (4)...................  (3) * (4) = (5)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                FERC-725S--Proposed estimates due to RD23-1 for EOP-011-3
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       One Time Estimate--Years 1 and 2 EOP-011-3
--------------------------------------------------------------------------------------------------------------------------------------------------------
EOP-011-3.....................  168 (TOP)...........               1  168...................  60 hrs. $3,893.40.....  10,080 hrs. $654,091.2.
EOP-011-3 \173\...............  98 (BA).............               1  98....................  6 hrs. $389.34........  588 hrs. $38,155.32.
EOP-011-3 \174\...............  12 (RC).............               1  12....................  28 hrs. $1,816.92.....  336 hrs. $21,803.04.
                                                     ---------------------------------------------------------------------------------------------------
    Sub-total of EOP-011-3      ....................  ..............  278...................  ......................  11,004 hrs. $714,049.56.
     (One time).
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Ongoing Estimate--Year 3 ongoing EOP-011-3
--------------------------------------------------------------------------------------------------------------------------------------------------------
EOP-011-3 \175\...............  168 (TOP)...........               1  168...................  10 hrs. $648.90.......  1,680 hrs. $109,015.20.
EOP-011-3 \176\...............  98 (BA).............               1  98....................  10 hrs. $648.90.......  980 hrs. $63,592.20.
EOP-011-3 \177\...............  12 (RC).............               1  12....................  14 hrs. $908.46.......  168 hrs. $10,901.52.
                                                     ---------------------------------------------------------------------------------------------------
    Sub-Total of EOP-011-3      ....................  ..............  278...................  ......................  2,828 $183,508.92.
     (ongoing).
                                                     ---------------------------------------------------------------------------------------------------
    Sub-Total of ongoing        ....................  ..............  92.67 (rounded).......  ......................  942.67 hrs. (rounded)
     burden averaged over                                                                                             $61,169.64.
     three years.
                                                     ---------------------------------------------------------------------------------------------------
    Proposed Total Burden       ....................  ..............  370.67................  ......................  11,946.67 hrs.
     Estimate of EOP-011-3.                                                                                           $775,219.42 (rounded).
--------------------------------------------------------------------------------------------------------------------------------------------------------

                                   Table 3--Proposed Changes Due to Final Rule in Docket No. RD23-1-000 for EOP-012-1
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         Number of
    Reliability standard &       Type and number of       annual       Total number    Average number of burden
          requirement                  entity          responses per   of responses    hours per  response \178\            Total burden hours
                                                          entity
                                (1).................             (2)     (1) * (2) =  (4).......................  (3) * (4) = (5)
                                                                                 (3)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       FERC--725S
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       One Time Estimate--Years 1 and 2 EOP-012-1
--------------------------------------------------------------------------------------------------------------------------------------------------------
EOP-012-1 \179\...............  1,107 (GO)..........               1           1,107  150 hrs. $9,733.50........  166,050 hrs. $10,774,984.50.
EOP-012-1.....................  981 (GOP)...........               1             981  10 hrs. $648.90...........  9,810 hrs. $636,570.90.
                                                     ---------------------------------------------------------------------------------------------------
    Sub-Total for EOP-012-1     ....................  ..............           2,088  160 hrs. $10,382.40.......  175,860 hrs. $11,411,555.40.
     (one-time).
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Ongoing Estimate--Year 3 ongoing EOP-012-1
--------------------------------------------------------------------------------------------------------------------------------------------------------
EOP-012-1.....................  1,107 (GO)..........               1           1,107  40 hrs. $2,595.60.........  40,680 hrs. $2,639,725.20.
EOP-012-1.....................  981 (GOP)...........               1             981  10 hrs. $648.90...........  9,810 hrs. $636,570.90.
                                                     ---------------------------------------------------------------------------------------------------
    Sub-Total for EOP-012-1     ....................  ..............           2,088  50 hrs. $3,244.50.........  50,490 hrs. $3,276,296.10.
     (ongoing).
                                                     ---------------------------------------------------------------------------------------------------
    Sub-Total of ongoing        ....................  ..............             696  ..........................  16,830 hrs. $1,092,098.70.
     burden averaged over
     three years.
                                                     ---------------------------------------------------------------------------------------------------
    Proposed Total Burden       ....................  ..............           2,784  ..........................  192,690 hrs. $12,503,654.10.
     Estimate of EOP-012-1.
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 15010]]

 
                                                           Changes to FERC 725S by RD23-1-000
--------------------------------------------------------------------------------------------------------------------------------------------------------
FERC-725S modification          Current.............         Current                            Total change due to RD23-1-000
                                inventory...........       inventory
                                (hours).............     (responses)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Removal of EOP-011-1..........  18,000..............              12  -18,000 hrs.; -12 responses.
Updates to EOP-011-3..........  ....................  ..............  +11,946.67 hrs.; +370.67 responses.
Addition of EOP-012-1.........  ....................  ..............  +192,690 hrs.; +2,784 responses.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Titles: FERC-725S, Mandatory Reliability Standards for the Bulk-
Power System; EOP Reliability Standards.
---------------------------------------------------------------------------

    \170\ Burden hours per response may also include any methods for 
improvement not limited to trainings, drills, simulations, testing, 
etc.
    \171\ TOP=Transmission Operator, BA=Balancing Authority, 
GO=Generator Owner, GOP=Generator Operator and RC=Reliability 
Coordinator.
    \172\ The estimated hourly cost (salary plus benefits) is a 
combination based on the Bureau of Labor Statistics (BLS), as of 
2022, for 75% of the average of an Electrical Engineer (17-2071)-
$77.02, mechanical engineers (17-2141)-$67.79. $77.02 + $67.79/2 = 
72.405 x .75 = 54.303 ($54.30-rounded) ($54.30/hour) and 25% of an 
Information and Record Clerk (43-4199) $42.35 x .25% = 10.5875 
($10.59 rounded) ($10.59/hour), for a total ($54.30 + $10.59 = 
$64.89/hour).
    \173\ Reduce the estimate for balancing authorities from EOP-
011-2 down from previous 60 hours to 6 hours for EOP-011-3.
    \174\ Reduce the estimate for reliability coordinators from EOP-
011-2 down from previous 40 hours to 28 hours for EOP-011-3.
    \175\ Reduce the estimate for transmission operators from EOP-
011-2 down from previous 50 hours to 10 hours for EOP-011-3.
    \176\ Reduce the estimate for balancing authorities from EOP-
011-2 down from previous 50 hours to 10 hours for EOP-011-3.
    \177\ Reduce the estimate for reliability coordinators from EOP-
011-2 down from previous 20 hours to 14 hours for EOP-011-3.
    \178\ The estimated hourly cost (salary plus benefits) is a 
combination based on the Bureau of Labor Statistics (BLS), as of 
2022, for 75% of the average of an Electrical Engineer (17-2071)-
$77.02, mechanical engineers (17-2141)-$67.79. $77.02 + $67.79/2 = 
72.405 x .75 = 54.303 ($54.30-rounded) ($54.30/hour) and 25% percent 
of an Information and Record Clerk (43-4199) $42.35 x .25% = 10.5875 
($10.59 rounded) ($10.59/hour), for a total ($54.30 + $10.59 = 
$64.89/hour).
    \179\ The estimates for the generator owner and generator 
operator are being moved from the current EOP-011-2 to the new EOP-
012-1.
---------------------------------------------------------------------------

    Action: Modifications to Existing Collections of Information in 
FERC-725S.
    OMB Control Nos: 1902-0270 (FERC-725S).
    Respondents: Business or other for profit, and not for profit 
institutions.
    Frequency of Responses: On occasion (and proposed for deletion).
    Necessity of the Information: Reliability Standards EOP-011-3 
(Emergency Operations), and EOP-012-1 (Extreme Cold Weather 
Preparedness and Operations) are part of the implementation of the 
Congressional mandate of the Energy Policy Act of 2005 to develop 
mandatory and enforceable Reliability Standards to better ensure the 
reliability of the nation's Bulk-Power system. Specifically, the 
revised and new Reliability Standards ensure that generating resources 
are prepared for local cold weather events and that entities will 
effectively communicate the information needed for operating the Bulk-
Power System.
    Internal review: The Commission has reviewed NERC's proposal and 
determined that its action is necessary to implement section 215 of the 
FPA.
    104. Interested persons may obtain information on the reporting 
requirements by contacting the Federal Energy Regulatory Commission, 
Office of the Executive Director, 888 First Street NE, Washington, DC 
20426 [Attention: Ellen Brown, email: [email protected], phone: 
(202) 502-8663, fax: (202) 273-0873].
    105. Comments concerning the information collections and 
requirements approved for retirement in this Final Rule and the 
associated burden estimates, should be sent to the Commission in this 
docket and may also be sent to the Office of Management and Budget, 
Office of Information and Regulatory Affairs [Attention: Desk Officer 
for the Federal Energy Regulatory Commission]. For security reasons, 
comments should be sent by email to OMB at the following email address: 
[email protected].

V. Document Availability

    106. 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.
    107. From the Commission's Home Page on the internet, this 
information is available on eLibrary. The full text of this document is 
available on eLibrary in PDF and Microsoft Word format for viewing, 
printing, and/or downloading. To access this document in eLibrary, type 
the docket number excluding the last three digits of this document in 
the docket number field.
    108. 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].
    The Commission orders:
    (A) Reliability Standards EOP-011-3 and EOP-012-1, the associated 
violation risk factors and violation severity levels, and the newly 
defined terms Generator Cold Weather Critical Component, Extreme Cold 
Weather Temperature, and Generator Cold Weather Reliability Event, are 
hereby approved, as discussed in the body of this order.
    (B) NERC is hereby directed to develop and submit, within 12 months 
of the date of issuance of this order, modifications to Reliability 
Standard EOP-012-1 as discussed in the body of this order.
    (C) NERC is hereby directed to work with Commission staff to submit 
a plan no later than 12 months after the date of issuance of this order 
on how it will collect and assess data prior to and on the 
implementation of the following elements of Reliability Standard EOP-
012-1: (1) generator owner declared constraints and explanations 
thereof; and (2) the adequacy of the Extreme

[[Page 15011]]

Cold Weather Temperature definition, as discussed in the body of this 
order.
    (D) NERC is hereby directed to assess annual and event-based data 
submittals to address the following elements of Reliability Standard 
EOP-012-1: (1) generator owner declared constraints and explanations 
thereof; and (2) the adequacy of the Extreme Cold Weather Temperature 
definition, and to submit periodic reports to the Commission providing 
the results of the assessments, as discussed in the body of this order.

    By the Commission.

    Issued: February 16, 2023.
Kimberly D. Bose,
Secretary.
[FR Doc. 2023-04875 Filed 3-8-23; 11:15 am]
BILLING CODE 6717-01-P