sumed by the Commission to promote the effective and
efficient implementation and administration of bulk-power
system reliability. No delegation by the electric reliability
organization shall be valid unless approved by the Com-
mission.
‘‘(3)(A) A delegation agreement entered into under
this subsection shall specify the procedures for an affili-
ated regional reliability entity to propose entity rules or
variances for review by the electric reliability organization.
With respect to any such proposal that would apply on
an interconnection-wide basis, the electric reliability orga-
nization shall presume such proposal valid if made by an
interconnection-wide affiliated regional reliability entity
unless the electric reliability organization makes a written
finding that the proposal—
‘‘(i) was not developed in a fair and open proc-
ess that provided an opportunity for all interested
parties to participate;
‘‘(ii) has a significant adverse impact on reli-
ability or interstate commerce in other interconnec-
tions;
‘‘(iii) fails to provide a level of bulk-power sys-
tem reliability within the interconnection such that
it would constitute a serious and substantial threat
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to public health, safety, welfare, or national security;
or
‘‘(iv) creates a serious and substantial burden
on competitive markets within the interconnection
that is not necessary for reliability.
‘‘(B) With respect to any such proposal that would
apply only to part of an interconnection, the electric reli-
ability organization shall find such proposal valid if the
affiliated regional reliability entity or entities making the
proposal demonstrate that it—
‘‘(i) was developed in a fair and open process
that provided an opportunity for all interested par-
ties to participate;
‘‘(ii) would not have an adverse impact on
interstate commerce that is not necessary for reli-
ability;
‘‘(iii) provides a level of bulk-power system reli-
ability adequate to protect public health, safety, wel-
fare, and national security, and would not have a
significant adverse impact on reliability; and
‘‘(iv) in the case of a variance, is based on le-
gitimate differences between regions or between sub-
regions within the affiliated regional reliability enti-
ty’s geographic area.
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The electric reliability organization shall approve or dis-
approve such proposal within 120 days, or the proposal
shall be deemed approved. Following approval of any such
proposal under this paragraph, the electric reliability orga-
nization shall seek Commission approval pursuant to sub-
section (e)(3). Affiliated regional reliability entities may
not make requests for approval directly to the Commission
except pursuant to subsection (e)(3)(D).
‘‘(4) If an affiliated regional reliability entity re-
quests, consistent with paragraph (1), that the electric re-
liability organization delegate authority to it, but is unable
within 180 days to reach agreement with the electric reli-
ability organization with respect to such requested delega-
tion, such entity may seek relief from the Commission. If,
following notice and opportunity for comment, the Com-
mission determines that a delegation to the entity would
meet the requirements of subsection (1) above, and that
the delegation would be just, reasonable, not unduly dis-
criminatory or preferential, and in the public interest, and
that the electric reliability organization has unreasonably
withheld such delegation, the Commission may, by order,
direct the electric reliability organization to make such del-
egation.
‘‘(5)(A) The Commission may, upon its own motion
or upon complaint, and with notice to the appropriate af-
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filiated regional reliability entity or entities, direct the
electric reliability organization to propose a modification
to an agreement entered into under this subsection if the
Commission determines that—
‘‘(i) the affiliated regional reliability entity no
longer has the capacity to carry out effectively or ef-
ficiently its implementation or enforcement respon-
sibilities under that agreement, has failed to meet its
obligations under that agreement, or has violated
any provision of this section,
‘‘(ii) the rules, practices, or procedures of the
affiliated regional reliability entity no longer provide
for fair and impartial discharge of its implementa-
tion or enforcement responsibilities under the agree-
ment,
‘‘(iii) the geographic boundary of a regional
transmission organization approved by the Commis-
sion is not wholly within the boundary of an affili-
ated regional reliability entity and such difference is
inconsistent with the effective and efficient imple-
mentation and administration of bulk-power system
reliability, or
‘‘(iv) the agreement is inconsistent with another
delegation agreement as a result of actions taken
under paragraph (4) of this subsection.
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‘‘(B) Following an order of the Commission issued
under subparagraph (A), the Commission may suspend
the affected agreement if the electric reliability organiza-
tion or the affiliated regional reliability entity does not
propose an appropriate and timely modification. If the
agreement is suspended, the electric reliability organiza-
tion shall assume the previously delegated responsibilities.
The Commission shall allow the electric reliability organi-
zation and the affiliated regional reliability entity an op-
portunity to appeal the suspension. Any such appeal shall
not stay the suspension unless directed by the Commission
or a reviewing court.
‘‘(i) ORGANIZATION MEMBERSHIP.—Every system
operator shall be required to be a member of the electric
reliability organization and shall be required also to be a
member of any affiliated regional reliability entity oper-
ating under an agreement effective pursuant to subsection
(h) applicable to the region in which the system operator
operates or is responsible for operation of bulk-power sys-
tem facilities.
‘‘(j) INJUNCTIONS AND DISCIPLINARY ACTION.—(1)
Consistent with the range of actions approved by the Com-
mission under subsection (d)(4)(H), the electric reliability
organization may impose a penalty, limit activities, func-
tions, or operations, or take such other disciplinary actions
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the electric reliability organization finds appropriate
against a user of the bulk-power system if the electric reli-
ability organization, after notice and opportunity for inter-
ested parties to be heard, issues a finding in writing that
the user of the bulk-power system has violated an organi-
zation standard approved by the Commission. The electric
reliability organization shall immediately notify the Com-
mission of any disciplinary action imposed with respect to
an act or failure to act of a user of the bulk-power system
that affected or threatened to affect bulk-power system fa-
cilities located in the United States. The sanctioned party
shall have the right to seek suspension, modification, or
rescission of such disciplinary action by the Commission.
If the electric reliability organization finds it necessary to
prevent a serious threat to reliability, the organization
may seek injunctive relief in the United States district
court for the district in which the affected facilities are
located.
‘‘(2) A disciplinary action taken under paragraph (1)
may take effect no earlier than 30 days after the electric
reliability organization files with the Commission its writ-
ten finding and record of proceedings before the electric
reliability organization and the Commission posts the or-
ganization’s written finding, unless the Commission, on its
own motion or upon petition by the user of the bulk-power
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system which is the subject of the action, suspends the
action. The action shall remain in effect or remain sus-
pended until the Commission, after notice and opportunity
for hearing, affirms, sets aside, modifies, or reinstates the
action, but the Commission shall conduct such hearing
under procedures established to ensure expedited consider-
ation of the action taken.
‘‘(3) The Commission, on its own motion or upon
complaint of any person, may order compliance with an
organization standard and may impose a penalty, limit ac-
tivities, functions, or operations, or take such other dis-
ciplinary action as the Commission finds appropriate,
against a user of the bulk-power system with respect to
actions affecting or threatening to affect bulk-power sys-
tem facilities located in the United States if the Commis-
sion finds, after notice and opportunity for a hearing, that
the user of the bulk-power system has violated or threat-
ens to violate an organization standard.
‘‘(4) The Commission may take such action as is nec-
essary against the electric reliability organization or an af-
filiated regional reliability entity to assure compliance with
an organization standard, or any Commission order affect-
ing the electric reliability organization or an affiliated re-
gional reliability entity.
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