Staff Presentation at Commission meeting, 7/17/2014

Federal Energy Regulatory Commission
July 17, 2014
Open Commission Meeting
Staff Presentation
Items E-8, E-9 & E-10
“Good morning Acting Chairman LaFleur and Commissioners,
“Today we will provide a summary of reliability Agenda items E-8, E-9 and E-10.
“Agenda item E-8 is a draft Notice of Proposed Rulemaking on the Physical Security
Reliability Standard, CIP-014-1, submitted by the North American Electric Reliability
Corporation (NERC) in response to an order issued by the Commission on March 7, 2014.
The draft Notice of Proposed Rulemaking proposes to approve the Physical Security
Reliability Standard, including the associated violation risk factors, violation severity levels,
implementation plan and effective date.
“While proposing to approve the Physical Security Reliability Standard, the draft Notice of
Proposed Rulemaking, pursuant to the Commission’s authority under section 215(d)(5) of
the Federal Power Act, proposes to direct NERC to develop two modifications to the Physical
Security Reliability Standard. First, consistent with the March 7 Order, the draft Notice of
Proposed Rulemaking proposes to direct NERC to modify the physical security Reliability
Standard to include a procedure that allows applicable governmental authorities to add or
subtract facilities from an applicable entity’s list of critical facilities. Second, the draft Notice
of Proposed Rulemaking proposes to direct NERC to remove the undefined term
“widespread,” as used in the phrase “widespread instability,” from the Physical Security
Reliability Standard. This term is undefined and adds an element of ambiguity to the
proposed standard.
“In addition to the two proposed directives, the draft Notice of Proposed Rulemaking
proposes to direct NERC to submit two informational filings. The first informational filing,
which would be due six months following the effective date of a final rule in this proceeding,
would address whether the development of Reliability Standards that provide physical
security for all “High Impact” control centers, as that term is defined in current Reliability
Standard CIP-002-5.1, is necessary for the reliable operation of the Bulk-Power System.
The second informational filing, which would be due one year following the effective date of
a final rule in this proceeding, would address the resiliency of the Bulk-Power System when
confronted with the loss of critical facilities. The informational filing would explore what
steps could be taken, in addition to those required by the proposed Physical Security
Reliability Standard, to maintain the reliable operation of the Bulk-Power System when
faced with the loss or degradation of critical facilities.
“The draft Notice of Proposed Rulemaking seeks comment on these proposals and other
issues. Initial comments are due 45 days after publication of the Notice of Proposed
Rulemaking in the Federal Register. Reply comments are due within 15 days following the
initial comment due date.
“Agenda item E-9 is a draft Notice of Proposed Rulemaking that proposes to approve revised
Reliability Standard PRC-005-3, Protection System and Automatic Reclosing Maintenance,
requiring applicable entities to include certain autoreclosing relays as part of their protection
system maintenance programs. The draft Notice of Proposed Rulemaking also proposes to
direct NERC to submit a report two years after the effective date of the proposed Reliability
Standard, based on actual performance data and simulated system conditions from planning

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assessments, addressing whether the revised Reliability Standard applies to an appropriate
set of autoreclosing relays. Finally, the draft Notice of Proposed Rulemaking proposes to
direct NERC to modify the proposed Reliability Standard to include maintenance and testing
of supervisory devices associated with applicable autoreclosing relays. Comments on the
draft Notice of Proposed Rulemaking are due 60 days after its publication in the Federal
Register.
“Agenda item E-10 is a draft Final Rule that approves new Reliability Standard PRC-025-1,
governing generator relay loadability. The new Reliability Standard was developed in
response to a Commission directive, and will enhance reliability by reducing the likelihood of
premature or unnecessary tripping of generators during system disturbances. The draft
Final Rule also approves revisions to the current Reliability Standard governing transmission
relay loadability, in PRC-023-3, which clarify the applicability of the two Reliability
Standards.
“This concludes our presentation, we are happy to take any questions you may have.”

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