[Code of Federal Regulations]
[Title 7, Volume 11]
[Revised as of January 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1730.1]
[Page 319]
TITLE 7--AGRICULTURE
CHAPTER XVII--RURAL UTILITIES SERVICE, DEPARTMENT OF AGRICULTURE
PART 1730_ELECTRIC SYSTEM OPERATIONS AND MAINTENANCE--Table of Contents
Subpart A - General
Sec. 1730.1 Introduction.
(a) This part contains the policies and procedures of the Rural
Utilities Service (RUS) related to electric borrowers' operation and
maintenance practices and RUS' review and evaluation of such practices.
(b) The policies and procedures included in this part apply to all
electric borrowers (both distribution borrowers and power supply
borrowers) and are intended to clarify and implement certain provisions
of the security instrument and loan contract between RUS and electric
borrowers regarding operations and maintenance. This part is not
intended to waive or supersede any provisions of the security instrument and loan contract between RUS and electric borrowers.
(c) The Administrator may waive, for good cause, on a case by case
basis, certain requirements and procedures of this part.
Sec. 1730.2 RUS policy.
It is RUS policy to require that all property of a borrower be
operated and maintained properly in accordance with the requirements of
each borrower's loan documents. It is also RUS policy to provide
financial assistance only to borrowers whose operations and maintenance
practices and records are satisfactory or to those who are taking
corrective actions expected to make their operations and maintenance
practices and records satisfactory to RUS.
Sec. 1730.3 RUS addresses.
(a) Persons wishing to obtain forms referred to in this part should
contact: Program Support and Regulatory Analysis, Rural Utilities
Service, U.S. Department of Agriculture, Stop 1522, 1400 Independence
Ave., SW., Washington, DC 20250-1522, telephone (202) 720-8674.
Borrowers or others may reproduce any of these forms in any number
required.
(b) Documents required to be submitted to RUS under this part are to be sent to the office of the borrower's assigned RUS General Field
Representative (GFR) or such other office as designated by RUS.
Sec. 1730.4 Definitions.
Terms used in this part have the meanings set forth in 7 CFR Part
1710.2. References to specific RUS forms and other RUS documents, and
to specific sections or lines of such forms and documents, shall include the corresponding forms, documents, sections and lines in any subsequent revisions of these forms and documents. In addition to the terms defined in 7 CFR Part 1710.2, the term Prudent Utility Practice has the meaning set forth in Article 1, Section 1.01 of Appendix A to Subpart B of 7 CFR Part 1718--Model Form of Mortgage for Electric Distribution Borrowers, for the purposes of this Part.
Subpart B - Operations and Maintenance Requirements
Sec. 1730.20 General.
Each electric program distribution, transmission and generation
borrower (as defined in Sec. 1710.2) shall operate and maintain its
system in compliance with prudent utility practice, in compliance with
its loan documents, and in compliance with all applicable laws,
regulations and orders, shall maintain its systems in good repair,
working order and condition, and shall make all needed repairs,
renewals, replacements, alterations, additions, betterments and
improvements, in accordance with applicable provisions of the borrower's security instrument. Each borrower is responsible for on-going operations and maintenance programs, individually or regionally
performing a system security Vulnerability and Risk Assessment (VRA),
establishing and maintaining an Emergency Restoration Plan (ERP),
maintaining records of the physical, cyber and electrical condition and
security of its electric system and for the quality of services provided to its customers. The borrower is also responsible for all necessary inspections and tests of the component parts of its system, and for maintaining records of such inspections and tests. Each borrower shall budget sufficient resources to operate and maintain its system and annually exercise its ERP in accordance with the requirements of this part. An actual manmade or natural event on the borrowers system in which a borrower utilizes a significant portion of its ERP shall count as an annual exercise for that calendar year, provided that after conclusion of the event, the borrower verifies accuracy of the emergency points-of-contact (POC) and the associated contact numbers as listed in their ERP. For portions of the borrower's system that are not operated by the borrower, if any, the borrower is responsible for ensuring that the operator is operating and maintaining the system properly in accordance with the operating agreement.
[69 FR 60540, Oct. 12, 2004]
Sec. 1730.21 Inspections and tests.
(a) Each borrower shall conduct all necessary inspections and tests
of the component parts of its electric system, annually exercise its
ERP, and maintain records of such inspections and tests. For the purpose of this part, ``Exercise'' means a borrower's Tabletop execution of, or actual implementation of, the ERP to verify the operability of the ERP. Such Exercise may be performed singly by an individual borrower, or as an active participant in a multi-party (to include utilities, government agencies and other participants or combination thereof) Tabletop execution or actual full implementation of the ERP. For the purpose of this part, ``Tabletop'' means a hypothetical emergency response scenario in which participants will identify the policy, communication, resources, data, coordination, and organizational elements associated with an emergency response.
(b) The frequency of inspection and testing will be determined by
the borrower in conformance with applicable laws, regulations, national
standards, and Prudent Utility Practice. The frequency of inspection and testing will be determined giving due consideration to the type of
facilities or equipment, manufacturer's recommendations, age, operating
environment and hazards to which the facilities are exposed, consequences of failure, and results of previous inspections and tests.
The records of such inspections and tests will be retained in accordance with applicable regulatory requirements and Prudent Utility Practice. The retention period should be of a sufficient time period to identify long-term trends. Records must be retained atleast until the applicable inspections or tests are repeated.
(c) Inspections of facilities must include a determination of
whether the facility complies with the National Electrical Safety Code,
National Electrical Code (as applicable), and applicable State or local
regulations and whether additional security measures are considered
necessary to reduce the vulnerability of those facilities which, if
damaged or destroyed, would severely impact the reliability and security of the electric power grid, cause significant risk to the safety and health of the public and/or impact the ability to provide service to consumers over an extended period of time. The electric power grid, also known as the transmission grid, consists of a network of electrical lines and related facilities, including certain substations, used to connect distribution facilities to generation facilities, and includes bulk transmission and subtransmission facilities as defined in Sec. 1710.2 of this title. Any serious or life-threatening deficiencies shall be promptly repaired, disconnected, or isolated in accordance with applicable codes or regulations. Any other deficiencies found as a result of such inspections and tests are to be recorded and those records are to be maintained until such deficiencies are corrected or for the retention period required by paragraph (b) of this section, whichever is longer.
[63 FR 3450, Jan. 23, 1998, as amended at 69 FR 60540, Oct. 12, 2004]
Sec. 1730.22 Borrower analysis.
(a) Each borrower shall periodically analyze and document its
security, operations and maintenance policies, practices, and procedures to determine if they are appropriate and if they are being followed. The records of inspections and tests are also to be reviewed and analyzed to identify any trends which could indicate deterioration in the physical or cyber condition or the operational effectiveness of the system or suggest a need for changes in security, operations or maintenance policies, practices and procedures. For portions of the borrower's system that are not operated by the borrower, if any, the borrower's written analysis would also include a review of the operator's performance under the operating agreement.
(b) When a borrower's security, operations and maintenance policies,practices, and procedures are to be reviewed and evaluated by RUS, the borrower shall:
(1) Conduct the analysis required by paragraph (a) of this section
not more than 90 days prior to the scheduled RUS review;
(2) Complete RUS Form 300, Review Rating Summary, and other related
forms, prior to RUS' review and evaluation; and
(3) Make available to RUS the borrower's completed RUS Form 300
(including a written explanation of the basis for each rating) and
records related to the operations and maintenance of the borrower's
system.
(c) For those facilities not included on the RUS Form 300 (e.g.,
generating plants), the borrower shall prepare and complete an
appropriate supplemental form for such facilities.
[63 FR 3450, Jan. 23, 1998, as amended at 69 FR 60541, Oct. 12, 2004]
Sec. 1730.23 Review rating summary, RUS Form 300.
RUS Form 300 in Appendix A shall be used when required by this part.
Sec. 1730.24 RUS review and evaluation.
RUS will initiate and conduct a periodic review and evaluation of
the operations and maintenance practices of each borrower for the
purpose of assessing loan security and determining borrower compliance
with RUS policy as outlined in this part. This review will normally be
done at least once every three years. The borrower will make available
to RUS the borrower's policies, procedures, and records related to the
operations and maintenance of its complete system. Reports made by other inspectors (e.g., other Federal agencies, State inspectors, etc.) will also be made available, as applicable. RUS will not duplicate these other reviews but will use their reports to supplement its own review. RUS may inspect facilities, as well as records, and may also observe construction and maintenance work in the field. Key borrower personnel responsible for the facilities being inspected are to accompany RUS during such inspections, unless otherwise determined by RUS. RUS personnel may prepare an independent summary of the operations and maintenance practices of the borrower. The borrower's management will discuss this review and evaluation with its Board of Directors.
Sec. 1730.25 Corrective action.
(a) For any items on the RUS Form 300 rated unsatisfactory (i.e., 0
or 1) by the borrower or by RUS, the borrower shall prepare a corrective action plan (CAP) outlining the steps (both short term and long term) the borrower will take to improve existing conditions and to maintain an acceptable rating. The CAP must include a time schedule and cost estimate for corrective actions, and must be approved by the borrower's Board of Directors. The CAP must be submitted to RUS for approval within 90 days after the completion of RUS' evaluation noted in Sec. 1730.24.
(b) The borrower must periodically report to RUS in writing progress under the CAP. This report must be submitted to RUS every six months until all unsatisfactory items are corrected unless RUS prescribes a different reporting schedule.
Sec. 1730.26 Certification.
(a) Engineer's certification. Where provided for in the borrower's
loan documents, RUS may require the borrower to provide an ``Engineer's
Certification'' as to the condition of the borrower's system (including, but not limited to, all mortgaged property.) Such certification shall be in form and substance satisfactory to RUS and shall be prepared by a professional engineer satisfactory to RUS. If RUS determines that the Engineer's Certification discloses a need for improvements to the condition of its system or any other operations of the borrower, the borrower shall, upon notification by RUS, promptly undertake to accomplish such improvements.
(b) Emergency Restoration Plan certification. The borrower's Manager or Chief Executive Officer shall provide written certification to RUS stating that a VRA has been satisfactorily completed that meets the criteria of Sec. 1730.27 (a), (b), (c), or (d), as applicable and Sec. 1730.27(e)(1) through (e)(8), and that the borrower has an ERP that meets the criteria of Sec. 1730.28 (a), (b), (c), or (d), as
applicable, and Sec. 1730.28 (e), (f), and (g). The written
certification shall be in letter form. Applicants for new RUS electric
loans, loan guarantees or grants shall include the written certification in the application package submitted to RUS. If the self-certification of an ERP and VRA are not received as set forth in this section, approval of the loan, loan guarantees or grants will not be considered until the certifications are received by RUS.
[63 FR 3450, Jan. 23, 1998, as amended at 69 FR 60541, Oct. 12, 2004]
Sec. 1730.27 Vulnerability and Risk Assessment (VRA).
(a) Each borrower with an approved RUS electric program loan as of
October 12, 2004 shall perform an initial VRA of its electric system no
later than July 12, 2005. Additional or periodic VRA's may be necessary
if significant changes occur in the borrower's system, and records of
such additional assessments shall be maintained by the borrower.
(b) Each applicant that has submitted an application for an RUS
electric program loan or grant prior to October 12, 2004, but whose
application has not been approved by RUS by such date, shall perform an
initial VRA of its electric system in accordance with Sec. 1730.27(a).
(c) Each applicant that submits an application for an RUS electric
program loan or grant between October 12, 2004 and July 12, 2005 shall
perform an initial VRA of its electric system in accordance with Sec.
1730.27(a).
(d) Each applicant that submits an application for an RUS electric
program loan or grant on or after July 12, 2005 shall include with its
application package a letter certification that such applicant has
performed an initial VRA of its electric system. Additional or periodic
VRA's may be necessary if significant changes occur in the borrower's
system, and records of such additional assessments shall be maintained
by the borrower.
(e) The VRA shall include identifying:
(1) Critical assets or facilities considered necessary for the
reliability and security of the electric power grid as described in Sec. 1730.21(c);
(2) Facilities that if damaged or destroyed would cause significant
risk to the safety and health of the public;
(3) Critical assets or infrastructure owned or served by the
borrower's electric system that are determined, identified and
communicated as elements of national security by the consumer, State or
Federal government;
(4) External system impacts (interdependency) with loss of
identified system components;
(5) Threats to facilities and assets identified in paragraphs
(e)(1), (e)(2), (e)(3), and (e)(4) of this section;
(6) Criticality and risk level of the borrower's system;
(7) Critical asset components and elements unique to the RUS
borrower's system; and
(8) Other threats, if any, identified by an individual borrower.
[69 FR 60541, Oct. 12, 2004]
Sec. 1730.28 Emergency Restoration Plan (ERP).
(a) Each borrower with an approved RUS electric program loan as of
October 12, 2004 shall have a written ERP no later than January 12,
2006. The ERP should be developed by the borrower individually or in
conjunction with other electric utilities (not all having to be RUS
borrowers) through the borrower's unique knowledge of its system,
prudent utility practices (which includes development of an ERP) and the borrower's completed VRA. If a joint electric utility ERP is developed, each RUS borrower shall prepare an addendum to meet the requirements of paragraphs (e), (f), and (g) of this section as it relates to its system.
(b) Each applicant that has submitted an application for an RUS
electric program loan or grant prior to October 12, 2004, but whose
application has not been approved by RUS by such date, shall have a
written ERP in accordance with Sec. 1730.28(a).
(c) Each applicant that submits an application for an RUS electric
program loan or grant between October 12, 2004 and January 12, 2006,
shall have a written ERP in accordance with Sec. 1730.28(a).
(d) Each applicant that submits an application for an RUS electric
program loan or grant on or after January 12, 2006 shall include with
its application package a letter certification that such applicant has a written ERP.
(e) The ERP shall include:
(1) A list of key contact emergency telephone numbers (emergency
agencies, borrower management and other key personnel, contractors and
equipment suppliers, other utilities, and others that might need to be
reached in an emergency);
(2) A list of key utility management and other personnel and
identification of a chain of command and delegation of authority and
responsibility during an emergency;
(3) Procedures for recovery from loss of power to the headquarters,
key offices, and/or operation center facilities;
(4) A Business Continuity Section describing a plan to maintain or
re-establish business operations following an event which disrupts
business systems (computer, financial, and other business systems); and
(5) Other items, if any, identified by the borrower as essential for inclusion in the ERP.
(f) The ERP must be approved and signed by the borrower's Manager or Chief Executive Officer, and approved by the borrower's Board of
Directors.
(g) Copies of the most recent approved ERP must be made readily
available to key personnel at all times.
(h) The ERP shall be Exercised at least annually to ensure
operability and employee familiarity. Completion of the first exercise
of the ERP must occur on or before January 12, 2007.
(i) If modifications are made to an existing ERP:
(1) The modified ERP must be prepared in compliance with the
provisions of paragraphs (e), (f), and (g) of this section; and
(2) Additional Exercises may be necessary to maintain employee
operability and familiarity.
(j) Each borrower shall maintain records of such Exercises.
[69 FR 60541, Oct. 12, 2004]
Sec. 1730.29 Grants and Grantees.
For the purposes of this part, the terms ``borrower'' shall include
recipients of RUS electric program grants, and ``applicant'' shall
include applicants for such grants. References to ``security documents''
shall, with respect to recipients of RUS electric program grants,
include grant agreements and other grant-related documents.
[69 FR 60541, Oct. 12, 2004]
| File Type | application/msword |
| File Title | [Code of Federal Regulations] |
| Author | joyce.mcneil |
| Last Modified By | joyce.mcneil |
| File Modified | 2008-01-17 |
| File Created | 2008-01-17 |