Agenda Member Representatives Committee Pre-Meeting ... Highlights... · Agenda . Member Representatives Committee . Pre-Meeting Informational Session . Conference Call and Webinar

Agenda Member Representatives Committee Pre-Meeting Informational Session Conference Call and Webinar April 2, 2015 | 11:00 a.m. – 1:00 p.m. Eastern Conference Line: 1-877-262-1741 | Conference ID: 1523786 Click here for: Webinar Registration Introduction and Chair’s Remarks NERC Antitrust Compliance Guidelines and Public Announcement* Agenda Items

1. Opening Remarks

2. Schedule of Quarterly NERC Meetings and Conference Calls*

3. Topics for the Board of Trustees, Board Committees and MRC Meetings* - May 6-7, 2015

4. Overview of Items Included in the Policy Input Letter

a. Future of Standards Development*

b. Critical Infrastructure Protection Version 5 Transition Program*

c. Physical Security Reliability Standard Implementation*

d. Compliance Guidance*

5. Informational Items

a. Risk-Based Registration Update*

b. EPA Special Assessment: Phase I Status Update*

c. ES-ISAC Update*

d. Next Steps in Response to the Reliability Assurance Initiative Order*

e. FAC-003: Research and Development Results of Gap Factor Verification*

f. Overview and Update of Modeling Standards Implementation Plans*

*Background materials included.

https://cc.readytalk.com/cc/s/registrations/new?cid=6fmauth0oid4

Antitrust Compliance Guidelines I. General It is NERC’s policy and practice to obey the antitrust laws and to avoid all conduct that unreasonably restrains competition. This policy requires the avoidance of any conduct that violates, or that might appear to violate, the antitrust laws. Among other things, the antitrust laws forbid any agreement between or among competitors regarding prices, availability of service, product design, terms of sale, division of markets, allocation of customers or any other activity that unreasonably restrains competition. It is the responsibility of every NERC participant and employee who may in any way affect NERC’s compliance with the antitrust laws to carry out this commitment. Antitrust laws are complex and subject to court interpretation that can vary over time and from one court to another. The purpose of these guidelines is to alert NERC participants and employees to potential antitrust problems and to set forth policies to be followed with respect to activities that may involve antitrust considerations. In some instances, the NERC policy contained in these guidelines is stricter than the applicable antitrust laws. Any NERC participant or employee who is uncertain about the legal ramifications of a particular course of conduct or who has doubts or concerns about whether NERC’s antitrust compliance policy is implicated in any situation should consult NERC’s General Counsel immediately. II. Prohibited Activities Participants in NERC activities (including those of its committees and subgroups) should refrain from the following when acting in their capacity as participants in NERC activities (e.g., at NERC meetings, conference calls and in informal discussions):

• Discussions involving pricing information, especially margin (profit) and internal cost information and participants’ expectations as to their future prices or internal costs.

• Discussions of a participant’s marketing strategies.

• Discussions regarding how customers and geographical areas are to be divided among competitors.

• Discussions concerning the exclusion of competitors from markets.

• Discussions concerning boycotting or group refusals to deal with competitors, vendors or suppliers.

NERC Antitrust Compliance Guidelines 2

• Any other matters that do not clearly fall within these guidelines should be reviewed with NERC’s General Counsel before being discussed.

III. Activities That Are Permitted From time to time decisions or actions of NERC (including those of its committees and subgroups) may have a negative impact on particular entities and thus in that sense adversely impact competition. Decisions and actions by NERC (including its committees and subgroups) should only be undertaken for the purpose of promoting and maintaining the reliability and adequacy of the bulk power system. If you do not have a legitimate purpose consistent with this objective for discussing a matter, please refrain from discussing the matter during NERC meetings and in other NERC-related communications. You should also ensure that NERC procedures, including those set forth in NERC’s Certificate of Incorporation, Bylaws, and Rules of Procedure are followed in conducting NERC business. In addition, all discussions in NERC meetings and other NERC-related communications should be within the scope of the mandate for or assignment to the particular NERC committee or subgroup, as well as within the scope of the published agenda for the meeting. No decisions should be made nor any actions taken in NERC activities for the purpose of giving an industry participant or group of participants a competitive advantage over other participants. In particular, decisions with respect to setting, revising, or assessing compliance with NERC reliability standards should not be influenced by anti-competitive motivations. Subject to the foregoing restrictions, participants in NERC activities may discuss:

• Reliability matters relating to the bulk power system, including operation and planning matters such as establishing or revising reliability standards, special operating procedures, operating transfer capabilities, and plans for new facilities.

• Matters relating to the impact of reliability standards for the bulk power system on electricity markets, and the impact of electricity market operations on the reliability of the bulk power system.

• Proposed filings or other communications with state or federal regulatory authorities or other governmental entities.

Matters relating to the internal governance, management and operation of NERC, such as nominations for vacant committee positions, budgeting and assessments, and employment matters; and procedural matters such as planning and scheduling meetings.

Member RepresentativesCommittee (MRC)

Pre-Meeting and Informational WebinarApril 2, 2015

RELIABILITY | ACCOUNTABILITY2

• Review preliminary agenda topics for May 6 MRC meeting• Review preliminary agenda topics for the Board of Trustees

(Board) and associated Board committee meetings (May 6-7,2015)

• Receive updates on emerging and informational issues as part oftoday’s informational webinar

Objectives – Pre-Meeting and Informational Session


Schedule of Quarterly NERC Meetings and Conference Calls


• Board of Trustees, April 14 (TBA)• Corporate Governance and Human Resources Committee, April

27 (11:00 a.m., Eastern) Review non-financial aspects of the Form 990 2015 Q1 corporate goals update ERO Effectiveness Survey results Periodic review of NERC Governance Guidelines Staffing and recruiting update

Conference Calls, Prior to Arlington


• 2014 audited financial statement: review findings and recommendations

• Review performance of external auditor• Review first quarter unaudited statement of activities• Review financial aspects of the Form 990• Review procedures for approval of senior management

expenses• 2016 business plan and budget update

Finance and Audit CommitteeTime TBD, May 6


• CIP Version 5 transition update• CIP-014 implementation update• Risk-based compliance monitoring and enforcement

implementation• Coordinated oversight of multi-regional registered entities• Review key compliance and enforcement metrics and trends

Compliance CommitteeTime TBD, May 6


• ERO Enterprise IT application strategy update• FAC-003: research and development results of gap factor

verification• Future of standards development discussion• Review periodic review of NERC ANSI accreditation• Reliability Standards quarterly status report

Standards Oversight and Technology CommitteeTime TBD, May 6


• Recommended slate of members to the RISC• Request for MRC members to serve on the BOTNC• Responses to the Board’s request for policy input Future of standards development Critical infrastructure protection version 5 transition program Physical security reliability standard implementation Compliance guidance

• Policy discussion of key items from the Board committees Issues discussed during CGHR, FAC, BOTCC, and SOTC

• EPA Special Assessment Phase I• State of Reliability report

Member Representatives Committee1:00–5:00 p.m., May 6


• Summer Reliability Assessment• Long-Term Reliability Assessment process improvements• RISC update• ES-ISAC update• ERO Enterprise Effectiveness Survey results• Regulatory update

Member Representatives Committee1:00–5:00 p.m., May 6


• Committee membership and charter changes• Standards for adoption PRC-004-5, CIP-014-2, and PRC-005

• Approve SPP Bylaws revisions• North American SynchroPhasor initiative• Update on Canadian affairs• Committee, forum and group reports Accept 2014 audited financial statements Approve first quarter 2015 unaudited statement of activities

Board of Trustees8:30 a.m., May 7


• Overview of Policy Input Letter items Future of standards development Critical infrastructure protection version 5 transition program Physical security reliability standard implementation Compliance guidance

• Risk-based registration update• EPA Special Assessment: Phase I status update• ES-ISAC update• Next steps in response to reliability assurance initiative order• FAC-003: research and development results of gap factor

verification• Overview and update of modeling standards implementation

plans

April 2 – MRC Informational Session


• April 2: Policy Input Letter issued• April 22: May Board and MRC agenda packages posted• April 24: Policy Input Letter responses due• April 30: May Board and MRC presentations posted

Upcoming Dates


Agenda Item 4a MRC Informational Session April 2, 2015

Future of Standards Development

Action Information Background Since the initial set of Reliability Standards became mandatory and enforceable on June 18, 2007, NERC has made significant efforts to improve upon the standards and address FERC directives, including the Paragraph 81 project and Independent Experts Review Panel. These efforts resulted in the identification of a number of requirements recommended for retirement. In 2014, the 2015-2017 Reliability Standards Development Plan (RSDP) was developed to lay out a plan to reach “steady-state”1 currently expected by early 2016. This plan includes addressing the FERC directives and considering the recommended requirements for retirement. The resulting body of standards will be improved by considering quality and content criteria as well as results-based standards principles. As the NERC Reliability Standards approach steady-state, there is an opportunity to explore the future of standards development, including whether further improvements are needed to the standards. For example, a project could be initiated to focus on: 1) a review of the content of standards to identify if their requirements could be more effectively written to mitigate risks to the Bulk Power System (BPS); 2) whether the standards are results-based and drafted with high quality; 3) whether the standards are concise or if the number of requirements could be reduced; and 4) whether compliance expectations are clear. As part of the policy input letter and through discussion at the May Standards Oversight and Technology Committee meeting, the Board is requesting industry policy input on the future of NERC Reliability Standards development. Responses and the discussion should consider the following principles:

• Standards should contain actions for which there needs to be accountability to maintain the reliability of the BPS.

• Standards should support the mitigation of an identified risk to the BPS. Depending on the risk being mitigated, a standard may be the best solution. However, Reliability Standards are not the only solution to address all risks to reliability.

• Scope of the risk covered by the standard and compliance expectations should be aligned and made public.

1 As defined in the 2015-2017 RSDP, “steady-state” means a stable set of clear, concise, high-quality and technically sound Reliability Standards that are results-based, including retirement of requirements that do little to promote reliability.

Future of Standards Development

Valerie Agnew, Senior Director of StandardsMRC Informational SessionApril 2, 2015


• Steady-State will be reached early 2016 Steady-State means:o FERC directives and recommendations for retirement have been addressed o Quality and content have been reviewedo Standards have transitioned closer to being results-based

• For discussion - are further improvements needed?• Principles to consider Standards provide accountability Standards should mitigate risks to the Bulk Power System Standard and compliance expectations should be aligned

Policy Input on the Future of Standards


Agenda Item 4b MRC Informational Session April 2, 2015

Critical Infrastructure Protection (CIP) Version 5 Transition Program

Action Information CIP Version 5 (CIP V5) Transition Program Update During the first quarter of 2015, as background for both the January 16, 2015 MRC informational session1 and February 11, 2015 MRC meeting,2 NERC provided the MRC an overview of its CIP V5 transition program (Transition Program). As discussed further in that background, the Transition Program is designed to accomplish the following objectives: (1) implementation readiness, (2) clarifying compliance and enforcement expectations, (3) providing industry and Regional Entities a better understanding of the technical and compliance-related resources and efforts necessary for an efficient and effective transition, and (4) ensuring consistent and reasonable enforcement of CIP V5. Based on the feedback that the MRC provided, NERC is continuing its efforts to accomplish the goals of the Transition Program and provide the industry with relevant and timely information to help support the transition to CIP V5. The following is an update on the progress of the Transition Program. To support implementation readiness, NERC continues to work with the Regional Entities and industry stakeholders through the transition advisory group to finalize and issue documents to provide guidance to industry on the implementation of various CIP V5 requirements. Since the last update, NERC and the transition advisory group have finalized two lessons learned documents (Generation Segmentation and Far-end Relay) pursuant to Section 11 of the Standard Processes Manual. Interactive Remote Access, Grouping of Bulk Electric System Cyber Systems and Mixed Trust Electronic Access Control and Monitoring Systems (EACMS) will be the next lessons learned, ready for Standards Committee review in April. In response to the MRC’s input, NERC has also expedited the release or review of the remaining lessons learned documents and frequently asked questions in February and March 2015, roughly one year before the effective date of CIP V5. This expedited release or review provides increased certainty about compliance expectations. A lesson learned is intended to provide explanation or guidance on approaches that are effective at accomplishing the required results by the standards. A lesson learned is not intended to change or revise a requirement, as such revisions would need to occur through the standards development process. Those guidance documents are available at http://www.nerc.com/pa/CI/Pages/Transition-Program-V5-Implementation-Study.aspx. NERC is also developing an outreach webinar to explain the disposition of each issue previously identified, and any topics that were not pursued through the expedited review as a lesson learned (e.g., because after further review of the existing, drafting team-developed guidance and development record of the standard, it should no longer be characterized as a “lesson

1http://www.nerc.com/gov/bot/MRC/Agenda%20Highlights%20nad%20Minutes%202013/16Jan15_MRC_Pre-Meeting_Info_Session_Webinar_agenda_pkg.pdf 2 http://www.nerc.com/gov/bot/MRC/Agenda%20Highlights%20nad%20Minutes%202013/February_11_MRC_agenda_package.pdf

http://www.nerc.com/pa/CI/Pages/Transition-Program-V5-Implementation-Study.aspx

http://www.nerc.com/pa/CI/Pages/Transition-Program-V5-Implementation-Study.aspx

http://www.nerc.com/gov/bot/MRC/Agenda%20Highlights%20nad%20Minutes%202013/16Jan15_MRC_Pre-Meeting_Info_Session_Webinar_agenda_pkg.pdf


http://www.nerc.com/gov/bot/MRC/Agenda%20Highlights%20nad%20Minutes%202013/February_11_MRC_agenda_package.pdf


learned”) will be discussed and documented for future awareness. At the time these materials were developed, the date and time of that outreach was not finalized, but it will be announced widely to industry when scheduled. In addition, NERC is continuing its Security Reliability Program (SRP) outreach in 2015. As discussed in the background for the January MRC informational session and February MRC meeting, the purpose of the SRP is to provide one-on-one opportunities for NERC, Regional Entity staff, and the registered entity to: (1) review the content of the CIP version 5 standards, (2) discuss challenges that the registered entity has encountered as it implements systems and processes in support of CIP V5 compliance, and (3) provide the registered entity feedback and guidance on CIP V5 implementation. For 2015, SRP visits include mandatory Regional Entity (including some cross-Regional) participation and focus on fostering consistency between Regional approaches to CIP compliance issues. To date, ten SRP visits have been scheduled for 2015, consisting of four Regional workshops, and six individual registered entity visits. Since the last update on the Transition Program, NERC hosted two of three Small Group Advisory Sessions (SGAS) described in previously identified background materials.3 The SGAS are designed to provide registered entities an opportunity to engage ERO Enterprise compliance staff on specific issues impacting their implementation of the CIP V5 standards. One additional workshop is being conducted April 21-23, 2015. Over 40 different entities have registered to attend the upcoming workshops in person. Entities may also attend remotely during the general session webinar where ERO Enterprise staff present the latest updates regarding CIP V5 implementation. Initial feedback from the sessions has been incredibly positive, which will inform continuing outreach throughout 2015. On March 13, 2015, NERC issued revised Reliability Standard Audit Worksheets (RSAWs) for CIP V5. ERO Enterprise CIP compliance staff and the standards drafting team for the CIP V5 revisions project (CIP V5R SDT) met often in the first quarter of 2015 to comprehensively review and update the RSAWs to increase clarity and improve industry’s understanding of compliance expectations for both newly modified requirements and previously approved language. In January, the ERO Enterprise compliance staff met with the CIP V5R SDT for two days to lay out a schedule for completing the development of the RSAWs and to receive input from the CIP V5R SDT on areas where the RSAWs can be improved. The ERO Enterprise CIP compliance staff made revisions to the RSAWs based on the input received. The ERO Enterprise compliance staff held a webinar with the CIP V5R SDT in February to explain the changes that the ERO Enterprise compliance staff made to the RSAWs. Following the meeting, all of the revised RSAWs were provided to the CIP V5R SDT for their review. In March, the ERO Enterprise compliance staff met with the CIP V5R SDT for two days to comprehensively review the RSAWs and take additional comments for further revision of the RSAWs. Following the two-day session, the ERO Enterprise compliance staff made additional revisions to the RSAWs and sent the full suite of RSAWs to the CIP V5R SDT for their review. After the review and a quality assurance check, the RSAWs were posted for industry wide comments. This level of engagement helped provide transparency to the RSAWs and the ERO Enterprise compliance monitoring process for CIP V5. Improvements included the following modifications:

• Closer alignment to guidelines and technical basis to help inform the auditor and industry of the compliance expectations of CIP V5.

3 http://www.nerc.com/pa/CI/Pages/Transition-Program-Calendar.aspx

http://www.nerc.com/pa/CI/Pages/Transition-Program-Calendar.aspx

• Clearer focus on security and reliability outcomes to align with the direction of results-based standards as opposed to policy and procedure adherence.

As part of its CIP Curriculum Program, NERC made a concerted effort to coordinate Regional Entity outreach activities so that the message, material and outcomes are similar across the ERO Enterprise. While the outreach and industry engagement options of the Transition Program are being executed, NERC continues to coordinate in-depth training to the Regional Entities on such topics as RSAWs, lessons learned, FAQs and insight gained from other ERO Enterprise-wide outreach activities. NERC is committed to improving the consistency of compliance practices across the ERO Enterprise. For instance, NERC has implemented the following program improvements:

• Encouraged dialogue between the Regions and NERC CIP compliance staff on prevailing transition and CIP V5 issues through an email listserv.

• Weekly coordination meetings used to update Regional staff on the latest program changes.

• Weekly outreach coordination meetings structured to harmonize outreach materials across the ERO Enterprise.

• Each Regional representative attends weekly meetings of the CIP V5 Advisory Group to discuss lessons learned and FAQ items in support of the transition to CIP V5.

• In-person CIP auditor training and coordination sessions which meet every two months

Additional Information A link to the CIP Version 5 Transition Program website is included here for reference: CIP Version 5 Transition Program.

http://www.nerc.com/pa/CI/Pages/Transition-Program.aspx

CIP Version 5 Transition Program

Steven Noess, Director of Compliance AssuranceMRC Informational Session April 2, 2015


CIP V5 Transition Program

Implementation Readiness

Clarify Compliance

Expectations

Resource Requirement

AlignmentConsistent

Enforcement

Support Industry

Confidence

“Support all entities in the timely, effective, and efficient transition to CIP Version 5”


• Small Group Advisory Sessions Over 50 entities attending one-on-one sessions Open webinar provided for transition updates

• Security Reliability Program (SRP) meetings Over 10 SRPs scheduled for 2015

• CIP Workshops and Curriculum Includes calendar of outreach activities from all Regions Archived presentations and webinar recordings

• Reliability Standard Audit Worksheets posted• Guidance documents posted for comment

Status of CIP V5 Transition


• Programmable Electronic Devices• Virtualization• Routable and Non-Routable Networks

Key Issues


• Continued ERO Enterprise staff coordination• Additional Small Group Advisory sessions• April outreach webinar• Increased stakeholder outreach

Next Steps


Agenda Item 4c MRC Informational Session April 2, 2015

Physical Security Reliability Standard Implementation

Action Information Background In the background materials for the January 16, 2015 MRC informational session1 and February 11, 2015 MRC meeting,2 NERC provided an overview of its efforts to support implementation of Reliability Standard CIP-014-1 – Physical Security. The following is an update on those efforts and an outline of NERC’s key activities for supporting effective and efficient implementation of CIP-014-1. Guidance. While CIP-014-1 contains a Guidelines and Technical Basis section to assist registered entities in implementing the requirements, NERC understands that the industry would benefit from additional guidance, especially related to the performance of the risk assessment to identify critical facilities. Accordingly, NERC is collaborating with industry participants and Regional Entities to develop additional guidance on CIP-014-1. More specifically, NERC is developing a series of guidance documents for the Regional Entities, which will be publicly available, outlining the ERO’s compliance and enforcement expectations for the various requirements in CIP-014-1. In February 2015, NERC provided guidance communication to the Regional Entities on implementation of Requirements R1 and R2.3 Additionally, NERC is collaborating with certain reliability-focused industry groups in developing guidance for successful implementation of specific requirements in CIP-014-1. For example, the North American Transmission Forum (NATF) developed a guidance document for Requirement R1 which was included in NERC’s February guidance communication to industry.4 Importantly, NERC recognizes that there may be more than one approach to achieving compliance with CIP-014-1’s requirements, so it is not planning to “adopt” or “endorse” a specific approach as the only way to comply with the standard. The timeline below summarizes the schedule for additional guidance:

Requirement Guidance Posting R1 & R2 Risk assessment approach and third-party

assessment considerations (complete) February 2015

R4 & R5 Examples of threat & vulnerability assessment and security plans

April 2015

R6 NERC third-party assessment program July 2015

1http://www.nerc.com/gov/bot/MRC/Agenda%20Highlights%20nad%20Minutes%202013/16Jan15_MRC_Pre-Meeting_Info_Session_Webinar_agenda_pkg.pdf 2 http://www.nerc.com/gov/bot/MRC/Agenda%20Highlights%20nad%20Minutes%202013/February_11_MRC_agenda_package.pdf 3 http://www.nerc.com/pa/CI/PhysicalSecurityStandardImplementationDL/CIP-014%20Memo%20to%20the%20ERO%20021015.pdf 4 http://www.natf.net/wp-content/uploads/NATF-CIP4312-0.014-1-R1-Guideline-V1-Open.pdf





http://www.nerc.com/pa/CI/PhysicalSecurityStandardImplementationDL/CIP-014%20Memo%20to%20the%20ERO%20021015.pdf

http://www.nerc.com/pa/CI/PhysicalSecurityStandardImplementationDL/CIP-014%20Memo%20to%20the%20ERO%20021015.pdf

http://www.natf.net/wp-content/uploads/NATF-CIP4312-0.014-1-R1-Guideline-V1-Open.pdf

Monitor and Assess Implementation. NERC management, per the Board of Trustees’ (Board) instruction, will monitor and assess implementation of CIP-014-1. Specifically, NERC management intends to monitor the general number and characteristics of assets identified as critical and the scope of security plans developed to meet the requirements in CIP-014-1, including the timelines provided for implementation of the various security and resiliency measures included in the plan. Following the effective date of CIP-014-1, NERC intends to report quarterly to the Board in response to the Board’s request. The focus for the next quarter and throughout 2015 will shift toward continuing coordination among NERC, Regional Entities, and industry leadership (particularly through the standards drafting team) to ensure common understanding of expectations related to supporting and assessing effective implementation of the standard. Outreach and Communications. As the Federal Energy Regulatory Commission (FERC) has issued a final order approving CIP-014-1 and registered entities have begun steps toward implementation, NERC will continue providing regular communications and outreach on key information to support industry’s implementation of the standard. NERC has conducted webinars in February and March 2015 to reflect the most recent guidance communication. Going forward, NERC will conduct additional workshops and/or technical conferences based on feedback from industry and in conjunction with Regional Entity outreach activities. Training. Throughout 2015 NERC will provide training to Regional Entity staff to support consistency of approach in compliance monitoring and enforcement expectations for CIP-014-1. Initial coordination to ensure auditor training and consistent application of CIP-014-1 began in Atlanta, Georgia during the week of September 15, 2014. Additional training and coordination continues as part of NERC’s regular CIP compliance monitoring and enforcement staff training to help ensure a consistent, reasonable, and transparent approach to monitoring CIP-014-1 under the risk-based Compliance Monitoring and Enforcement Program.

Collectively, these elements will help ensure a more common understanding of implementation expectations for CIP-014-1 throughout 2015.

Standards Development in Response to FERC Directives. Additionally, the following is an update to the standards development project to address FERC’s directive in Order No. 802 to remove the term “widespread” from Reliability Standard CIP-014-1 or, alternatively, to propose modifications to the Reliability Standard that address FERC’s concerns. FERC directed that NERC submit a responsive modification within six months from the effective date of Order No. 802. The Physical Security Standard Drafting Team (PSSDT) revised CIP-014-1 by removing the term “widespread” from the standard. This was done in the Purpose Statement, Background Section, Requirement R1, the Rationale for Requirement R1, as well as the Guidance and Technical Basis Section of the standard. The PSSDT has provided additional guidance and clarification to the Rationale and guideline and Technical Basis for Requirement R1. The proposed standard and corresponding Reliability Standard Audit Worksheet (RSAW) have been posted for a 45-day comment and ballot period which ends on April 9, 2015.

Physical Security Reliability Standard ImplementationSteven Noess, Director of Compliance AssuranceMRC Informational SessionApril 2, 2015


CIP-014 Implementation Program

Implementation Readiness

Clarify Compliance

Expectations

Understanding Scoping and

3rd Party Reliance

Consistent Enforcement

Increased Industry

Awareness

“Support all entities in the timely, effective, and efficient implementation of CIP-014”


• Key enforcement dates: Requirement R1 is enforceable on October 1, 2015 Requirements R2 is enforceable on December 30, 2015 R2.3 through R6 must be completed according to the timelines specified in

the Implementation Plan

• Collaboration with NATF and other groups on guidance• Expected guidance posting dates: February 2015 (Completed): R1, R2 (Risk Assessment and Verification) April 2015: R4 and R5 (Threat Evaluation/Physical Security Plans) July 2015: R6 (Threat and Evaluation/Security Plan Verifications)

Increasing Industry’s Understanding


• April 2015 Spring Standards and Compliance workshop• ERO Enterprise staff training and coordination continues• Next steps Increased coordination supporting effective implementation Continued ERO Enterprise collaboration with focus on guidance Future workshops and webinar updates throughout 2015

Outreach and Training


Agenda Item 4d MRC Informational Session April 2, 2015

Compliance Guidance

Action Information Background Through the Policy Input Letter and with discussion led by a panel of industry and ERO Enterprise representatives at the May MRC meeting, the Board of Trustees (Board) will be seeking industry input regarding the use and format of guidance for implementing NERC Reliability Standards. Transparency of guidance documents for compliance has gone from having little information released to industry to being transparent to ensure that compliance monitoring is “open-book.” Guidance may come from several sources, including “Guidelines and Technical Basis” sections that are part of Reliability Standards, the use of Reliability Standards Audit Worksheets (RSAWs), Lessons Learned and FAQs developed to support implementation, and through other NERC or industry-led outreach or materials. Other communications have also been tested, such as Bulletins, Compliance Application Notices (CANs) and Compliance Analysis Reports (CARs). Input describing the value and use of such guidance will inform policy discussions intended to support future guidance development, including transparency of compliance guidance to industry, industry’s participation in the development of the guidance, and how the guidance is updated to reflect situations identified in the field. The Board will request input on a series of questions in the policy input letter which will also be used by the panel at the May MRC meeting. Responses and possible solutions should consider the following principles:

• Compliance expectations should be transparent to industry.

• Guidance documents cannot expand upon the requirements of the Reliability Standard.

• Guidance documents issued by the ERO for auditors must reflect the independent, professional judgment of ERO compliance and enforcement staff.

• NERC and the Regional Entities should have the flexibility to apply professional judgement in making compliance and enforcement determinations. In applying professional judgement, NERC and the Regional Entities use professional standards (including professional auditing standards).

Compliance Guidance

Valerie Agnew, Senior Director of StandardsMRC Informational SessionApril 2, 2015


• Input requested on value and use Content Forms of guidance preferred Distinction between industry and ERO Enterprise staff guidance Development approaches and appropriate level of industry input Maintenance

• Principles Compliance expectations are transparent, “open-book” Guidance does not expand the standard Guidance must reflect independent, professional judgement of ERO staff Compliance and enforcement staff adhere to professional auditing

standards

Policy Input on Compliance Guidance


Agenda Item 5a MRC Informational Session April 2, 2015

Risk-Based Registration Update

Action Information Background NERC launched the first phase of the Risk-Based Registration (RBR) initiative in 2014. The purpose for this enhanced registration program is to ensure the right entities are subject to the right set of applicable NERC Reliability Standards, using a consistent registration approach that differentiates entities with different levels of risk across North America. To provide advice on the RBR policy, design, and implementation plan, NERC organized the RBR advisory group (RBRAG) comprised of representatives from NERC, Regional Entities, Federal Energy Regulatory Commission (FERC), and industry from both the United States and Canada. Additionally, a technical RBR task force formed for the phase I effort has been enhanced to provide technical support for the RBR phase II design framework. Phase I On March 19, 2015, FERC issued an order approving the majority of NERC’s RBR proposal and recognizing that the initiative ensures that the right entities are subject to the right set of NERC Reliability Standards. FERC also recognized that the effect of the initiative will be to allow reliability stakeholders to focus more closely on issues with a greater potential to impact reliability. FERC requested additional information prior to the elimination of the functional registration category for Load-Serving Entities, including how certain reliability data would be obtained. FERC also added PRC-005, NERC’s protection system maintenance standard, to the sub-set list of standards for under-frequency load shedding Distribution Providers. These two items, as well as a word change to make clear that the NERC-led review panel shall review individual and aggregate risk issues, will be addressed in a compliance filing due sixty days from the order. In addition, FERC requested that NERC submit additional information in one year about the implementation of its proposal. Phase II At the end of 2014, NERC conducted two workshops to address risk-based categories of Transmission Owners/Transmission Operators (TO/TOP) for this phase of RBR. NERC also conducted two workshops for Generator Owner/Generator Operators (GO/GOP) in March 2015. The RBR task force will meet on March 31, 2015 to discuss and finalize the scope of the applicable studies and surveys to test framework proposals along with test examples for the TO/TOP and GO/GOP functions. NERC continues to coordinate and seek input from the North American Generator Forum (NAGF), the ISO/RTO Council, and the Organization Registration Certification Subcommittee (ORCS). This collaboration supports the RBR phase II efforts to right-size the NERC Compliance Registry and help determine solutions for categories of GO/GOPs and TO/TOPs. A technical report with the enhanced design and implementation plan is targeted for presentation to the Board of Trustees in November 2015. The report will detail technical analysis, profiles, and comments from industry supporting the design and providing a design and implementation plan for GO/GOPs and TO/TOPs.

Risk-Based Registration UpdateEarl Shockley, Senior Director, Compliance Analysis and CertificationMRC Informational SessionApril 2, 2015


• FERC approved the risk-based registration (RBR) proposal with limited changes NERC Registry Criteria updates Sixty day compliance filing One year informational filing on implementation

Risk-Based Registration Phase I Update


Proposed Risk-Based Registration Phase II Status

• Recent technical workshops (GO/GOP): March 17 and 19

• Risk criteria and profiles for GO/GOP and TO/TOP functions• Establish draft risk criteria and profiles for applicable standards• Determine necessary studies and validations (testing)• Seek RBRAG advice and RBR task force technical input• Continue industry engagement, feedback and outreach


Key Tasks to Support Phase II

• Technical workshops have been conducted to identify risk profiles of GO/GOPs and TO/TOPs

Technical Workshops

• Collaboration with the RBRAG, RBR Task Force, Regional Entities, NAGF, ORCS, the ISO/RTO Council, TAPS, and APPA

Regional & Industry

Engagement

• Seek industry comment on draft risk profiles and sub-sets of applicable Reliability Standards

Feedback & Outreach

• Report will be presented to the Board of TrusteesTechnical Report


2014 2015

TO/TOP Technical Conferences

GO/GOP Technical Conferences

Communication, Training, Feedback and Outreach

Report to Board of Trustees

Commence Studies

Study Results Submitted

Comment Period

Finalize criteria and standards applicable

MRC Policy Input

Q4Q3Q2Q1

Phase II Timeline


Agenda Item 5b MRC Informational Session April 2, 2015

EPA Special Assessment: Phase I Status Update

Action Information Background NERC's reliability assessment activities on the Environmental Protection Agency’s (EPA) proposed Clean Power Plan (CPP) are intended to provide technically sound information about the potential for Bulk Power System reliability impacts. This knowledge is intended to inform state officials, public utility commissioners, utilities, and other interested stakeholders of the potential reliability consequences from the proposed rule. As highlighted in NERC's Initial Reliability Review, if reductions are not achievable in certain building blocks, offsetting reductions will be needed in the remaining building blocks to achieve the CO2 reduction objectives. For NERC’s Phase I Assessment, NERC will examine the original EPA building block assumptions as modeled in the June 2014 Integrated Planning Model, and will also incorporate the “rate-to-mass translation” proposal contained in the EPA Guidelines for Existing Stationary Sources, posted on November 6, 2014.1 Using these EPA Guidelines, NERC conducted an independent scenario assessment considering the U.S. Energy Information Administration’s (EIA) Annual Energy Outlook 2014 (AEO2014) reference gas and low gas price cases; one with state implementation and a second with regional implementation. This analysis will focus particularly on the timing available to address the rule's implementation, the anticipated shifts in resources (i.e., both fuel and geography), and consequent changes in the network’s ability to manage reliable operations (e.g., larger transfers and power swings). Summary NERC’s Phase I Assessment consists of a three part analysis:

• Part 1 of the study will consist of a scenario analysis on the implementation of the CPP to identify resource adequacy implications as well as the timeline associated with reliability reinforcements required to meet CPP regulations. NERC will also evaluate the need for new natural gas infrastructure.

• Part 2 of the study will consist of a transmission adequacy assessment evaluating a baseline of infrastructure additions and the identification of infrastructure upgrades needed to support the CPP implementation scenario analysis of part 1. Information on electric infrastructure upgrade lead times has been collected through questionnaire responses from Transmission Owners and Generator Owners from the eight regions. The survey results of infrastructure lead times will be used to determine infrastructure construction timelines with respect to the proposed CPP timeline and requirements.

1 Additional Information Regarding The Translation Of Emission Rate Based Co2 Goals To Mass Based Equivalents.

http://www.nerc.com/pa/RAPA/ra/Reliability%20Assessments%20DL/Potential_Reliability_Impacts_of_EPA_Proposed_CPP_Final.pdf

http://www.nerc.com/pa/RAPA/ra/Reliability%20Assessments%20DL/Potential_Reliability_Impacts_of_EPA_Proposed_CPP_Final.pdf

https://www.federalregister.gov/articles/2014/11/13/2014-26900/carbon-pollution-emission-guidelines-for-existing-stationary-sources-electric-utility-generating

• Part 3 of the study will be NERC’s independent review of existing studies completed by ERCOT, WECC, SPP, MISO and PJM. NERC will report on key reliability information and insights from these studies to identify cumulative impacts on a region-wide basis.

Prospectively, as the rules and their implementation impacts become more clearly known, NERC will continue to monitor and assess any reliability concerns. Key Dates for Publication of NERC’s Phase I Assessment

• Board of Trustees consideration for approval – targeted for April 14, 2015

• Release – targeted for April 21, 2015 Key Dates for NERC’s Continuing Reliability Reviews

• EPA Rule finalized – summer 2015

• Phase II Assessment: Reliability Review of Final CPP Rule – starting after CPP rule is finalized, late 2015 – early 2016

• Phase III Assessment: Reliability Review of State Implementation Plan Submittals – starting June 2016

EPA Special Assessment:Phase I Status Update

John Moura, Director, Reliability AssessmentMRC Informational Session April 2, 2015


• Part 1: Resource Adequacy Quantitative generation dispatch assessment Sensitivity scenarios - gas prices; state versus regional

• Part 2: Transmission Adequacy and Infrastructure Transmission impacts evaluated with projected resource changes Considers baseline transmission additions Infrastructure deployment lead times – industry survey

• Part 3: Review of Existing Studies Independent evaluation of regional/area-specific studies WECC, ERCOT, SPP, MISO and PJM

Phase I Study Three Part Assessment


Phase 1 Study Scheduled Milestones

Date Milestone

April 7, 2015 Board of Trustees and MRC to review embargoed version of the report

April 14, 2015 (targeted)

Board of Trustees to consider report for approval

April 21, 2015 (targeted) Publish report on NERC website


November 2014

April2015

December2016

December2015

EPA Special Assessment

Phase III• Placeholder for

assessment completed once SIPs are developed (some single state, some multi-state)


Initial Reliability Review

• High-level reliability considerations

• Assessment of EPA’s rule assumptions


Phase II• Additional

assessment of emerging SIPs

• Reflects final rule• Based on known

requirements • Complete before

states submit (SIPs)

EPA Special AssessmentPhase I

• Evaluation of resource and transmission adequacy

• Sensitivity analysis used to provide range of potential outcomes

EPA Reliability Impacts AssessmentMultiple Phase Approach


Agenda Item 5c MRC Informational Session April 2, 2015

ES-ISAC Update

Action Information Summary This Electricity Sector Information Sharing and Analysis Center (ES-ISAC) update will include information on the Cybersecurity Risk Information Sharing Program (CRISP), GridEx III, and the Electricity Sub-sector Coordinating Council (ESCC) strategic review of the ES-ISAC. Details on each of these efforts are highlighted below. CRISP CRISP is a voluntary NERC program that facilitates the exchange of detailed cybersecurity information among industry, NERC’s ES-ISAC, the Department of Energy, and Pacific Northwest National Laboratory (PNNL). The program enables owners and operators to better protect their networks from sophisticated cyber threats. The purpose of CRISP is to facilitate the timely sharing of classified and unclassified threat information, enhance situational awareness, and better protect critical infrastructure. The ES-ISAC functions as the program manager and PNNL is the technical partner responsible for installing equipment and supporting analysis. The ES-ISAC provides a central point for coordination and functions as the hub for collaborative analysis of CRISP data. Unattributed CRISP reporting and data is shared through the ES-ISAC portal, providing more widespread benefits to industry. A brief update on the status of CRISP will be provided at the webinar. GridEx III On November 18-19, 2015, NERC will host the third Grid Security Exercise (GridEx III), a combined cyber and physical threat scenario against the reliable operation of the Bulk Power System, building on lessons learned from the exercises in 2011 and 2013. On March 11-12, 2015, the GridEx III Initial Planning Conference (IPC) was held with over 200 Planners from over 100 organizations participating from the US, Canada, and Mexico. The IPC objectives were: familiarize Planners with GridEx III; explain the benefits for participating as an “Active Organization” versus “Observing Organization;” and finalize attack vectors and expected impacts on reliable Bulk Power System operation in the exercise. The objectives of the IPC were met and the group developed a scenario narrative describing the exercise attack vectors that will be vetted and finalized at Idaho National Laboratory at the end of March. The GridEx III Mid-term Planning Conference will be held on June 10-11, 2015. Stakeholder outreach and exercise planning is ongoing. For more information or to participate in GridEx III, please contact Bill Lawrence at the ES-ISAC. ESCC Strategic Review of the ES-ISAC Sharing of cyber and physical security threat and vulnerability information is critical to the risk management processes of the electricity subsector. The subsector relies on the NERC operated

mailto:[email protected]?subject=GridEx%20III%20MRC%20question

ISAC, the ES-ISAC, as the hub for sharing this information within the subsector, with other sectors, and with government. However, the fact that NERC also has an important regulatory role for the subsector creates a challenge to building trust within the sector. Overcoming this challenge and strengthening the effectiveness of information sharing requires collaboration within the subsector to identify, understand, and clarify the role of the ES-ISAC and develop a strategy to increase the engagement of the subsector with the ES-ISAC. The ESCC Strategic Review (Strategic Review) will leverage this collaboration to build upon the capabilities of the ES-ISAC to achieve this goal. The objective of the Strategic Review is to develop and implement a strategy to enhance the ES-ISAC’s existing capabilities and expertise to establish the ES-ISAC as a trusted entity of critical infrastructure owners and operators that rapidly and effectively shares critical sector information within the electricity subsector, with other sectors, and with government. The Strategic Review will use the following steps:

1. Baseline – The Core Project Team will baseline and analyze the ES-ISAC capabilities and summarize the findings as input to increase awareness within the subsector (i.e., outreach activities) and for use in benchmarking to develop the strategy. This initial analysis will focus on the ES-ISAC governance, operating procedures, resources (e.g., staff, contractors, expertise, funding sources), policy (e.g., membership), products, and tools/technology used by the ISAC. The analysis will also examine the existing use of the ES-ISAC by the subsector and information sharing with the Federal Government and other external stakeholders.

2. Benchmark – The Core Project Team will compare the baseline analysis with the capabilities of other information sharing and analysis organizations (ISAO), including other ISACs and third-party service providers, to identify opportunities for improvement and methods to address resource gaps. The Core Project Team will rely on document reviews, ES-ISAC visits and staff interviews, visits with other ISAOs, and discussions with ES-ISAC users and non-users from the subsector to baseline and benchmark capabilities.

3. End-State Identification – The Core Project Team will share the baseline and benchmark results and their recommendations with the executive sponsors and external consultants. Based on these results and recommendations, the executive sponsors will identify the end-state model for the ES-ISAC, which may include recommendations to continue, discontinue, or add capabilities to the ES-ISAC.

4. Report – The executive sponsors will share the initial Core Project Team findings and recommendations with the ESCC.

5. Implement – The Core Project Team will work with the executive sponsors to finalize the strategy to implement the end-state model, recognizing that the ES-ISAC capabilities will evolve over time. The Core Project Team will collaborate with the appropriate stakeholders to implement the strategy, which will include periodic progress updates by the executive sponsors to the ESCC.

ES-ISAC Update

Tim Roxey, NERC Chief Security OfficerLaura Brown, Policy and Coordination ManagerMRC Informational Session April 2, 2015

2 RELIABILITY | ACCOUNTABILITY

Topics

• Cyber Risk Information Sharing Program (CRISP)• Grid Security Exercise III (GridEx III)• ES-ISAC Strategic Review


CRISP Overview

• Voluntary program to facilitate the exchange of detailed cybersecurity information among: Electric Utilities Electricity Sector Information Sharing and Analysis Center (ES-ISAC) US Department of Energy (DOE) Pacific Northwest National Laboratory (PNNL)

• Allow electric power critical infrastructure operators to better protect their networks from sophisticated cyber threats


The GridEx Program

What: North American-wide exercise conducted every two yearsPurpose: Strengthen the industry’s capability to respond to and recover from simulated severe security events affecting the Bulk Power SystemWho: NERC-registered entities and others as determined by individual entities (e.g., law enforcement, local government, suppliers). Voluntary, not mandatory.How: Simulated cyber and physical attacks that degrade Bulk Power System operations

Improve communication

Identify lessons learned

Exercise crisis response and recovery

1

2

3

Engage senior leadership

4

GridEx III Objectives


• Identify the Lead Planner for your organization• Have your Lead Planner contact [email protected]• March 11-12 – Initial Planning Conference

Finalize attack scenario and impacts

• June 10-11 – Mid-term Planning Conference Finalize detailed baseline scenario

• TBD in September – Final Planning Conference Finalize customized scenarios with Reliability

Coordinators, train Players

• November 18-19 – GridEx III execution

How to Participate in GridEx III

mailto:[email protected]


• Electricity Subsector Coordinating Council (ESCC) established the Strategic Review in January 2015

• Objective: to develop and implement a strategy to enhance the ES-ISAC’s existing capabilities and expertise to establish the ES-ISAC as a trusted entity of critical infrastructure owners and operators that rapidly and effectively shares critical sector information within the Electricity Subsector, with other sectors, and with government

Strategic Review Overview


Timeline


Agenda Item 5d MRC Informational Session April 2, 2015

Next Steps in Response to the Reliability Assurance Initiative (RAI) Order

Action Information Background On November 3, 2014, NERC submitted an informational filing to the Federal Energy Regulatory Commission (FERC or the Commission) describing the various processes and programs developed and deployed through the ERO Enterprise's risk-based Compliance Monitoring and Enforcement Program (risk-based CMEP). On February 19, 2015, the Commission issued an order approving the implementation of the risk-based CMEP. In the order, the Commission directed NERC to submit by May 20, 2015 (90 days) a compliance filing addressing various details on the risk-based CMEP and including revisions to the NERC Rules of Procedure that articulate the RAI concepts and programs. In addition to the above, the FERC Order imposed certain conditions on the implementation and continued development of the program and directed NERC to submit by February 19, 2016 (one year of the order) an annual report on the risk-based CMEP implementation. Status Update Immediately after the Commission issued the February 19 order, NERC began collaborating with the Regional Entities to address the items FERC identified as requiring additional attention. On March 12, 2015, NERC filed a motion for a 45-day extension of time for the Rules of Procedure revision changes. This request did not affect the other items that the Commission requested the ERO address in the May 20, 2015 compliance filing. The Commission approved NERC’s motion for an extension on March 16, 2015, which extends the time to file the Rules of Procedure revisions to and including July 6, 2015. On or before May 20, 2015, NERC will submit a compliance filing to FERC that will address those areas the Commission identified in its February 19 order. While this filing will not include the final redline Rules of Procedure changes for FERC approval, it will include a status update regarding the proposed revisions. NERC’s proposed timeline for the Rules of Procedure filing is to post the proposed revisions on or around March 30, 2015 for a 45-day public comment period. This 45-day public posting would close on or around May 14, 2015. The Board of Trustees would then need to consider the proposed revisions. If the Board of Trustees approves these revisions, NERC would file the proposed Rules of Procedure changes with FERC for its approval on or before July 6, 2015. Additional Information A link to the RAI website and Rules of Procedure revision public posting is included here for reference: http://www.nerc.com/pa/comp/Pages/Reliability-Assurance-Initiative.aspx and http://www.nerc.com/AboutNERC/Pages/Rules-of-Procedure.aspx.

http://www.nerc.com/pa/comp/Pages/Reliability-Assurance-Initiative.aspx

http://www.nerc.com/AboutNERC/Pages/Rules-of-Procedure.aspx

Next Steps in Response to the Reliability Assurance Initiative OrderSonia Mendonca, Deputy General Counsel and Vice President of Compliance and EnforcementMRC Informational SessionApril 2, 2015


• February 19, 2015 FERC Order approved the implementation of the Reliability Assurance Initiative, subject to conditions

• Compliance exceptions Public posting Impact on subsequent noncompliance posing a serious risk Finality

• Self-logging Formal review of internal controls

• Compliance filings and revisions to the NERC Rules of Procedure (ROP)

Background


• Details on oversight processes, measures of success, and metrics• Methodology for assessing an entity’s internal controls before

self-logging authorization is provided; standard for content and review of logs

• FERC granted a request for extension of time to submit ROP revisions

May 20, 2015 Compliance Filing


• Articulate concepts and programs – not detailed procedures• Recognize the existence of the risk-based processes and define

fundamental elements• Require FERC approval for significant changes to risk-based

processes (in particular for any expansion of compliance exceptions to possible violations posing a moderate risk)

July 6, 2015 ROP Filing


• Public posting: on or around March 30, 2015• 45-day public comment period ends: on or around May 14, 2015• Filing: on or before July 6, 2015

Timeline for ROP Revisions


• Progress of the program and trends• Interplay between the risk-based processes and other NERC

program areas• Internal control evaluation methodology• Update regarding NERC’s oversight of the program, including

whether it has been implemented in a consistent manner across the Regional Entities; update on the metrics

• How a Regional Entity assesses the use of NERC Alerts, Lessons Learned, Reliability Guidelines, and other NERC learning tools by registered entities

February 19, 2016 Annual Filing


Agenda Item 5e MRC Informational Session April 2, 2015

FAC-003: Research and Development Results of Gap Factor Verification

Action Information Background FAC-003-3 uses a defense-in-depth strategy to manage vegetation located on transmission rights-of-way (ROW) and minimize encroachments from vegetation located adjacent to the ROW, thus preventing the risk that vegetation-related outages could lead to cascading outages. The standard requires Minimum Vegetation Clearance Distances (MVCDs) derived from the Gallet equation. In 1975, G. Gallet published a benchmark paper that provided a method to compute the critical flashover voltage (CFO) of various air gap geometries, adjusted by respective “gap factors”1. This method provides clearance distance values for a given voltage to be derived for different transmission configurations, adjusted for various altitudes. The distances derived using the Gallet equation result in the probability of flashover in the range of 10-6. In Order No. 7772, FERC directed NERC to conduct testing to support MVCDs established in the NERC Reliability Standard FAC-003-3. NERC contracted the Electric Power Research Institute (EPRI) to conduct this testing, which started in early 2014, supported by an industry advisory group and the active engagement of FERC staff. The preliminarily results of the tests showed that the gap factor applied in the Gallet equation to calculate MVCDs should be modified. The adjustment involves effectively increasing the MVCDs for all alternating current system voltages covered by Table 2 of the standard. Further testing in Q2 2015 will be performed to validate the gap factor, and the corresponding MVCDs, and confirm the specific gap factor for integration within the FAC-003-3 standard. Summary The preliminary research and development results from the tests for MVCDs showed that the gap factor applied in the Gallet equation to calculate MVCDs should be modified. This will result in an increased MVCD for all ac system voltages covered by Table 2 of the standard. In recognition of the potential reliability implications, a wide range of communications are being developed to provide information to the industry, including a preliminary report, alert/advisory, webinar, and other communications. The advisory alert will provide interim information to applicable Transmission Owners and Generator Owners so they can consider adjusting their vegetation management programs to account for the increased MVCDs. In addition, a narrowly scoped Standard Authorization Request will be developed by the industry advisory group to initiate a standards development activity to adjust the MVCD values in FAC-003-3, based on the final EPRI research.

1 http://www.nerc.com/pa/Stand/Project 200707 Transmission Vegetation Management/Transmission_Veg_Man_Standard_FAC-003-2_Technical_Ref_093011.pdf 2 http://www.nerc.com/FilingsOrders/us/FERCOrdersRules/E-5_Order_FAC-003-2_2013.3.21.pdf

http://www.nerc.com/pa/Stand/Project%20200707%20Transmission%20Vegetation%20%20Management/Transmission_Veg_Man_Standard_FAC-003-2_Technical_Ref_093011.pdf

http://www.nerc.com/pa/Stand/Project%20200707%20Transmission%20Vegetation%20%20Management/Transmission_Veg_Man_Standard_FAC-003-2_Technical_Ref_093011.pdf

http://www.nerc.com/FilingsOrders/us/FERCOrdersRules/E-5_Order_FAC-003-2_2013.3.21.pdf

FAC-003:Research and Development Results of Gap Factor Verification

Thomas Burgess, Vice President and Director, Reliability Assessment and Performance AnalysisMRC Informational Session April 2, 2015


• March 2013 —FAC-003-3 (Order 777) directed testing for Minimum Vegetation Clearance Distances (MVCD)

• July 2013 — Project plan submitted to FERC

• January 2014 — Advisory team assembled and project initiated

• October 2014 — Planned testing completed by NERC and EPRI

Background


• Testing included various tree shapes Vertical grow-in Horizontal blow-in

• Indicates a gap factor of 1.0 may be more appropriate than the present value of 1.3 contained in FAC-003-3

• Actual MVCD may increase Increase varies with system voltage levels Initial findings for increases of clearance distances range from 1’ to 3.5’

• Being verified with additional testing

Preliminary Findings


• Various communication tools for preliminary results Webinar (March 25, 2015) Standards and Compliance Workshop (April 1-3, 2015) April 2015 NERC News MRC Info Session (April 2, 2015)

• May 2015 – Advisory Alert with preliminary report and data • May 2015 – Conclude validation testing• June 2015 — File NERC report with FERC• July 2015 – NERC Advisory Alert with final report and data • July 2015 – Initiate changes to Reliability Standard FAC-003-3

Going Forward


Agenda Item 5f MRC Informational Session April 2, 2015

Overview and Update of Modeling Standards Implementation Plans

Action Information Background The current Modeling, Data, and Analysis (MOD) standards, MOD-032 and MOD-033, were approved by the Federal Energy Regulatory Commission (FERC) in May 2014, replacing several “fill-in-the-blank” MOD standards. These standards are designed to provide modeling data requirements and reporting procedures that support enhanced, jointly developed steady-state, dynamic, and short circuit models and cases representing the behavior of the major interconnections in North America. Both standards are complementary, establishing consistent data requirements for Bulk Power System (BPS) modeling, data reporting procedures, and validation requirements for the development of accurate steady-state, short circuit, and dynamic system models. The interconnection cases developed from these accurate models are critical to support system analysis used in planning and planning operations. MOD-032 requires data submission by applicable data owners to their respective Transmission Planners (TPs) and Planning Coordinators (PCs) to support interconnection-wide model and case building processes. Further, MOD-032 calls for NERC to create the interconnection cases or designate organizations to perform this activity. MOD-033 requires each PC to implement a documented process to complete model validation within their respective planning areas. These standards transition responsibility to the PC and TP functions for the coordination and integration of model data for transmission facilities and resource plans, as well as responsibility for the integrity and consistency of the data. These enhancements resulted from several recommendations and FERC directives within Order 693. The standards also recognize that differences exist between the approaches and processes already established in the Western, Eastern (including Québec), and Texas interconnections. The intent is to create a framework to support existing approaches, while identifying changes required to develop cases that sufficiently represent the behavior of the BPS. The MOD-032 implementation plans require PCs and their respective TPs to establish data requirements and reporting practices starting July 1, 2015, and data submittals starting July 1, 2016 to the ERO-designated entities responsible to build to interconnection cases. Under MOD-033, the implementation involves establishing a data validation process and demonstrated validation against actual system behavior starting in July 1, 2017. As part of the implementation, these submittals and validation processes are provided to the ERO or its designee to support creation of the interconnection-wide cases. In order to facilitate the implementation of these respective transitions, NERC initiated a series of workshops and the creation of a Modeling Project Task Force (MPTF) with representatives from industry and Regional Entities. The major objective of this group is to assist with the development of the criteria and processes used for the ERO-designee selection and formalize the designation for each of the three major interconnections by no later than July 1, 2015. The

primary functional responsibility of the designees are to assemble and test the interconnection-wide steady-state and dynamics cases, based on data and models submitted by PCs and TPs under MOD-032/-033. The objective of the testing and validation of interconnection models and cases is to improve the cases by comparing their responses to those observed from the actual system events. Summary NERC’s primary principles for implementation and transition processes include ensuring that existing case and model development are not disrupted during the transition of responsibilities. Secondly, there must be dependable transition plans that recognize the need to prepare any newly designated entities. This will be followed by an orderly shift for compliance and enforcement functions to the assigned PC and TP entities. The overall implementation includes:

• Modeling Workshops: The initial modeling workshop conducted in November 2014 provided an overview and outline of requirements under the standards, initial designation process elements, and milestones under the standards implementation timelines. This began the development of the designee functions and responsibilities for assembling interconnection cases and models.

• Modeling Project Task Force (MPTF): In February 2015, the MPTF provided a more detailed framework of designee roles, functions, and expectations criteria. In addition, the initial development of the designee’s plans and transition activities was undertaken. The transition and implementation plans recognize linkage with the modeling initiative in the ERO 2015 corporate metric designed to improve case accuracy and fidelity.

• Designation of Interconnection Entities: An interconnection designee will be formalized for each of Western, Texas, and Eastern (including Québec) Interconnections no later than July 1, 2015, with deference to the existing entities currently performing these functions.

Key Dates for Publication of NERC’s Phase 1 Assessment

• Designation of interconnection entities – by no later than July 1, 2015

• PC and TP obligations as described in MOD-032 implementation plan – July 1, 2015

• PC and TP obligations as described in MOD-033 implementation plan – July 1, 2017

Overview and Update of Modeling Standards Implementation PlansThomas Burgess, Vice President and Director, Reliability Assessments and Performance AnalysisMRC Informational SessionApril 2, 2015


• MOD-032 and MOD-033 approved • Together they establish modeling requirements Steady-state, short circuit, and dynamics Planning Coordinators (PC) and Transmission Planners (TP) responsible for

data and models

• ERO-designated entities Assemble interconnection models and cases NERC’s designee selection by July 2015

• Enhance quality - fidelity of reliability models and cases

Modeling Implementation Overview


• Modeling Summit – November 2014

• Modeling Project Task Force (MPTF) – March 2015• Project plans under development Implementation for MOD-032 and MOD-033 (July 2015 - 2017)

• ERO designee selection – by July 2015• Pre-2016 case creation process Continue with existing approach

Modeling Project Update


MOD-032-1• July 1, 2015 — Effective date for R1 Data collection requirements and reporting procedure

• July 1, 2016 — Effective date for R2, R3, and R4 Data collection begins for PCs and TPs

MOD-033-1• July 1, 2017— Effective date for all requirements Model validation begins

MOD-032/-033 Implementation Schedule


Core Cases to be Created

• Winter peak load cases Seasonal planning studies (interregional) and event analyses Provides external models for operational planning studies

• Summer peak load cases Seasonal planning studies (interregional) and event analyses Provides external models for operational planning studies

• Spring light-load cases For validation of Interconnection Frequency Response Obligations (IFROs) Also available for event analyses


Target milestones for designee designation: • MPTF to complete designee requirements• NERC disseminate designee requirements• Designee candidates to submit to NERC Case building and validation proposal Consistent with functions Transition plan from the current case creation processes

• Refine proposals and transition plans• By July 1 – ERO designate entities for each interconnection

Outline of Next Steps


Documents

Agenda Member Representatives Committee Pre-Meeting ... Highlights... · Agenda . Member Representatives Committee . Pre-Meeting Informational Session . Conference Call and Webinar