RM16-22NOPR supp state11-21-17

FERC-725G6 and FERC-725Y (OMB Control Nos. TBD, and 1902-0279)

NOPR (issued 11/16/2017) in Docket No. RM16-22

RIN #1902-AF45

Supporting Statement for

FERC-725G6 and FERC-725Y,¹

as proposed in the Notice of Proposed Rulemaking in Docket No. RM16-22

The Federal Energy Regulatory Commission (Commission or FERC) requests OMB review and approval of the changes to reporting and recordkeeping requirements, as proposed in the Notice of Proposed Rulemaking (NOPR) (Coordination of Protection Systems for Performance during Faults and Specific Training for Personnel Reliability Standards) in Docket No. RM16-22.

This consolidated supporting statement for FERC-725G6 (Mandatory Reliability Standard PRC-027-1) and FERC-725Y (Mandatory Reliability Standards: Personnel Performance, Training, and Qualifications) is being submitted, to reflect the changes proposed in the NOPR in RM16-22 (Coordination of Protection Systems for Performance during Faults and Specific Training for Personnel Reliability Standards). ² The proposed changes include:

• implementation of proposed Reliability Standards PRC-027-1 (to be included in FERC-725G6) and PER-006-1 (to be included in FERC-725Y)

• retirement of Reliability Standard PRC-001-1.1(ii) (currently included in FERC-725A).

1. CIRCUMSTANCES THAT MAKE THE COLLECTION OF INFORMATION NECESSARY

Background.

On August 8, 2005, The Electricity Modernization Act of 2005, which is Title XII of the Energy Policy Act of 2005 (EPAct 2005), was enacted into law.³ EPAct 2005 added a new section 215 to the Federal Power Act (FPA), which requires a Commission-certified Electric Reliability Organization (ERO) to develop mandatory and enforceable Reliability Standards, subject to Commission review and approval. Once approved, the Reliability Standards may be enforced by the ERO, subject to Commission oversight, or by the Commission independently.

Section 215 of the FPA requires a Commission-certified ERO to develop mandatory and enforceable Reliability Standards, subject to Commission review and approval.⁴ Once approved, the Reliability Standards may be enforced by the ERO subject to Commission oversight or by the Commission independently.⁵ In 2006, the Commission certified NERC (now called the North American Electric Reliability Corporation) as the ERO pursuant to section 215 of the FPA.⁶

On March 16, 2007 (pursuant to section 215(d) of the FPA), the Commission issued Order No. 693, approving 83 of the 107 initial Reliability Standards filed by NERC. Order 693 addressed several PER and PRC Reliability Standards. Some of them were approved. but others were approved with a Commission directive for NERC to make modifications. Other proposed standards remained pending. In the intervening years, numerous changes have been made to update, eliminate, or establish various Reliability Standards

Background on FERC-725Y. Order No. 693 included approval of four PER Reliability Standards governing certain areas of personnel staffing and training. In addition, under section 215(d)(5) of the FPA, the Commission directed NERC to develop several modifications to the approved PER standards..

NERC addressed a portion of the Order No. 693 directives in a September 30, 2009 filing; FERC approved those Reliability Standards in Order No. 742. However, the Commission noted that the standards did not fully satisfy the directives issued in Order No. 693, and issued additional directives to NERC.

On March 7, 2014, NERC filed a Petition seeking approval of proposed PER-005-2, explaining that the purpose of the revisions is to “improve upon PER-005-1 by expanding the scope of the Reliability Standard” consistent with the Commission’s directives in Order Nos. 693 and 742. The FERC Order in Docket No. RD14-7 addressed the NERC Petition and approved Reliability Standard PER-005-2; the related reporting and recordkeeping requirements were approved by OMB under FERC-725Y on 4/23/2015.

Background on FERC-725G6.¹^{, 7} On March 18, 2010, in Order No. 733, the Commission approved Reliability Standard PRC-023-1 (Transmission Relay Loadability)⁸ and directed NERC to develop a new Reliability Standard that requires the use of protective relay systems that can differentiate between faults and stable power swings and, when necessary, retirement of protective relay systems that cannot meet this requirement.⁹ In Order No. 733, the Commission cited the findings of both NERC and the U.S.-Canada Power System Outage Task Force on the causes of the 2003 Northeast Blackout, explaining that the cascade during this event was accelerated by zone 2 and zone 3 relays that continued to operate because these devices could not distinguish between a dynamic, but stable, power swing and an actual fault.¹⁰ The Commission recognized that addressing stable power swings is a complex issue which impacted the 2003 Blackout, and yet there was no Reliability Standard that addresses the issue; therefore, the Commission directed NERC to develop a Reliability Standard to address undesirable relay operation due to stable power swings.¹¹

FERC-725Y and FERC-725G6, as affected by NOPR in Docket RM16-22.

On September 2, 2016, NERC submitted a petition seeking Commission approval of proposed Reliability Standards PRC-027-1 and PER-006-1.¹² NERC states that the proposed Reliability Standards, new and revised NERC Glossary terms, and the retirement of Reliability Standard PRC-001-1.1(ii) satisfy the Commission’s criteria in Order No. 672 and are just, reasonable, not unduly discriminatory or preferential, and in the public interest.¹³ NERC explains that the intent of the proposed Reliability Standards and changes to the NERC Glossary are to maintain the coordination of protection systems installed to detect and isolate faults on bulk electric system elements and require registered entities to provide training to their relevant personnel on protection systems and remedial action schemes. NERC asserts that the proposed Reliability Standards are an improvement over currently-effective Reliability Standard PRC-001-1.1(ii) and will ensure that appropriate personnel are trained on protection systems and that protection systems are appropriately studied, coordinated, and monitored.

2. HOW, BY WHOM, AND FOR WHAT PURPOSE THE INFORMATION IS TO BE USED AND THE CONSEQUENCES OF NOT COLLECTING THE INFORMATION

FERC-725Y and FERC-725G6, as affected by NOPR in RM16-22.

As stated in NERC’s Petition¹⁴ [footnotes omitted],

“[t]he purpose of the proposed Reliability Standards and the proposed NERC Glossary definitions is to: (1) maintain the coordination of Protection Systems installed to detect and isolate Faults on Bulk Electric System (“BES”) Elements, such that those Protection Systems operate in the intended sequence during Faults; and (2) require registered entities to provide training to their relevant personnel on Protection Systems and Remedial Action Schemes (“RAS”) to help ensure that the BES is reliably operated. The reliable and coordinated operation of Protection Systems is essential to Bulk Power System (“BPS”) reliability for the following reasons. Protection Systems help maintain reliability by isolating faulted equipment, thereby reducing the risk of instability or Cascading, and leaving the remainder of the BPS operational and more capable of withstanding a future Contingency. In the event of a Fault, properly coordinated Protection Systems minimize the number of BES Elements that are removed from service and protect equipment from damage. System reliability is reduced or threatened if a Protection System can no longer perform as designed because of a failure of its relays. Further, the functions, settings, and limitations of Protection Systems are recognized and integrated in deriving System Operating Limits (“SOLs”) and Interconnection Reliability Operating Limits (“IROLs”).”

FERC-725G6. It is a new ‘placeholder’ information collection number.

FERC-725Y. The Personnel Performance, Training, and Qualifications (“PER”) group of Reliability Standards is intended to help ensure the safe and reliable operation of the

interconnected grid through the retention of suitably trained and qualified personnel in positions that can impact the reliable operation of the Bulk-Power System.

FERC-725G6 and FERC-725Y. In general, the reporting and recordkeeping requirements of FERC-725Y and FERC-725G6 (data reported and retained) are not submitted to FERC; rather the data are retained for access by NERC, the Regional Entity, or FERC in their respective roles of monitoring and enforcing compliance with the NERC Reliability Standards.

The consequences of failing to collect information would have an adverse impact as relay protection systems coordination studies may not properly identify potential problems such that faults could impact additional other electrical equipment and load (customers). Also, not providing training to appropriate generator operator personnel who should be familiar with protection systems and remedial actions schemes could lead to failure to act properly during system events.

3. DESCRIBE ANY CONSIDERATION OF THE USE OF IMPROVED INFORMATION TECHNOLOGY TO REDUCE THE BURDEN AND TECHNICAL OR LEGAL OBSTACLES TO REDUCING BURDEN

The submittals are not made to FERC.

The use of current or improved technology is not covered in Reliability Standards, and is therefore left to the discretion of each reporting entity. We think that nearly all of the respondents are likely to make and keep related records in an electronic format. Each of the eight Regional Entities has a well-established compliance portal for registered entities to electronically submit compliance information and reports. The compliance portals allow documents developed by the registered entities to be attached and uploaded to the Regional Entity’s portal. Compliance data can also be submitted by filling out data forms on the portals. These portals are accessible through an internet browser password protected user interface.

4. DESCRIBE EFFORTS TO IDENTIFY DUPLICATION AND SHOW SPECIFICALLY WHY ANY SIMILAR INFORMATION ALREADY AVAILABLE CANNOT BE USED OR MODIFIED FOR USE FOR THE PURPOSE(S) DESCRIBED IN INSTRUCTION NO. 2

The information is not available elsewhere. The standard-developing group (the ERO and various stakeholders) think these areas need to be addressed and documented, as indicated in the NERC Petition.

5. METHODS USED TO MINIMIZE THE BURDEN IN COLLECTION OF INFORMATION INVOLVING SMALL ENTITIES

Small entities generally can reduce their burden by taking part in a joint registration organization or a coordinated function registration. These options allow an entity the ability to share its compliance burden with other similar entities.

Detailed information regarding these options is available in NERC’s Rules of Procedure at sections 507 and 508. ¹⁵

6. CONSEQUENCE TO FEDERAL PROGRAM IF COLLECTION WERE CONDUCTED LESS FREQUENTLY

FERC-725Y. There would be greater risk and vulnerability to the safe and reliable operation of the Nation’s Bulk-Power System if suitably trained and qualified personnel were not retained and their training not provided, refreshed, and updated, and documented. The new PER standard covers generator operators which increase the scope of trained operators who shall be familiar with protection systems that could affect output of generation facilities.

FERC-725G6. Without updating the Protection and Control (PRC) standards, the reliability and security of the Nation’s Bulk Power System would be at greater risk. Additionally, failure to adequately update/review the PRC standards may cause a simple fault condition to expand or cascade outside of a zone of protection affecting more equipment and greater impact on load (customers).

7. EXPLAIN ANY SPECIAL CIRCUMSTANCES RELATING TO THE INFORMATION COLLECTION

There are no special circumstances as described in 5 CFR 1320.5(d)(2).

8. DESCRIBE EFFORTS TO CONSULT OUTSIDE THE AGENCY: SUMMARIZE PUBLIC COMMENTS AND THE AGENCY’S RESPONSE

The ERO process to develop proposed Reliability Standards is a collaborative process involving the ERO, Regional Entities and other stakeholders developing and reviewing drafts, and providing comments, vetting and voting (possibly multiple rounds) on the proposed standards, with the final proposed standard submitted to the FERC for review and approval.¹⁶

This Notice of Proposed Rulemaking is posted on FERC’s eLibrary¹⁷ and published on 11/22/2017 in the Federal Register to give the public and other entities an opportunity to comment.

9. EXPLAIN ANY PAYMENT OR GIFTS TO RESPONDENTS

The Commission does not make payments or provide gifts for respondents related to this collection.

10. DESCRIBE ANY ASSURANCE OF CONFIDENTIALITY PROVIDED TO RESPONDENTS

There are no specific assurances of confidentiality mentioned to respondents.

11. PROVIDE ADDITIONAL JUSTIFICATION FOR ANY QUESTIONS OF A SENSITIVE NATURE, SUCH AS SEXUAL BEHAVIOR AND ATTITUDES, RELIGIOUS BELIEFS, AND OTHER MATTERS THAT ARE COMMONLY CONSIDERED PRIVATE.

This collection does not contain any questions of a sensitive nature.

12. ESTIMATED BURDEN OF COLLECTION OF INFORMATION

NOPR in RM16-22. The number of respondents below is based on an examination of the NERC compliance registry on April 7, 2017, for transmission owners, generator owners, generator operators, and distribution providers within the United States and an estimate of how many entities from that registry will be affected by the Reliability Standards proposed for adoption and implementation. At the time of Commission review of proposed Reliability Standards PRC‑027‑1 and PER-006-1, 334 transmission owners, 913 generator owners, 875 generator operators, and 365 distribution providers in the United States were registered in the NERC compliance registry. However, under NERC’s compliance registration program, entities may be registered for multiple functions, so these numbers incorporate some double counting. We note that many generation sites share a common generator owner or generator operator.

The following table provides the estimated proposed annual burden and cost related to information collection requirements in the NOPR in Docket No. RM16-22.¹^{, 18}

Proposed Changes in the NOPR in Docket No. RM16-22-000
Respondent Category and Requirement19	Number of Respondents (1)	Annual Number of Responses per Respondent (2)	Total Number of Annual Responses (1)*(2)=(3)	Average Burden Hours & Cost per Response20 (4)	Annual Burden Hours & Total Annual Cost (rounded)21 (3)*(4)=(5)
FERC-725G6 (covering Proposed Reliability Standard PRC-027-1)22
TO; Reporting Reqs. R1, R2, & R3	334	1	334	60 hrs.; $3,941.40	20,040 hrs.; $1,316,428
TO; Recordkeeping Reqs.	334	1	334	40 hrs.; $1,565.60	13,360 hrs.; $522,910
GO; Reporting Reqs. R1, R2, & R3	913	1	913	10 hrs.; $656.90	9,130 hrs.; $599,750
GO; Recordkeeping Reqs.	913	1	913	10 hrs.; $391.40	9,130 hrs.; $357,348
DP; Reporting Reqs R1, R2, & R3	365	1	365	10 hrs.; $656.90	3,650 hrs.; $239,769
DP; Recordkeeping Reqs.	365	1	365	10 hrs.; $391.40	3,650 hrs.; $142,861
Sub-Total for Reporting Reqs. for FERC-725G6					32,820 hrs.; $2,155,947
Sub-Total for Recordkeeping Reqs. for FERC-725G6					26,140 hrs.; $1,023,119
Total Proposed Increase for FERC-725G6					58,960 hrs.; $3,179,066
FERC-725Y (covering Proposed Reliability Standard PER-006-1)23
GOP; Reporting Req. R1	875	1	875	5 hrs.; $328.45	4,375 hrs.; $287,394
GOP; Recordkeeping Req.	875	1	875	10 hrs.; $391.40	8,750 hrs.; $342,475
Total Proposed Increase for FERC-725Y					13,125 hrs.; $629,869
Reductions to FERC-725A (covering proposed retirement of Reliability Standard PRC-001-1.1)24
GOP; Reporting Req.	875	1	875	40 hrs.; $2,627.60	35,000 hrs.; $2,299,150
GOP; Recordkeeping Req.	875	1	875	50 hrs.; $1,957.00	43,750 hrs.; $1,712,375
TOP; Reporting Req.	177	1	177	60 hrs.; $3,941.40	10,620 hrs.; $697,628
TOP; Recordkeeping Req.	177	1	177	70 hrs.; $2,739.80	12,390 hrs.; $484,945
BA; Reporting Req.	99	1	99	32 hrs.; $2,102.08	3,168 hrs.; $208,106
BA; Recordkeeping Req.	99	1	99	20 hrs.; $782.80	1,980 hrs.; $77,497
Reduction Sub-Total Reporting Reqs. for FERC-725A					48,788 hrs.; $3,204,884
Reduction Sub-Total Recordkeeping Reqs. for FERC-725A					58,120 hrs.; $2,274,817
Reduction, Sub-Total for FERC-725A					106, 908 hrs.; $5,479,701 (reduction)
NET TOTAL REDUCTION FOR PROPOSED CHANGES IN NOPR IN RM16-22-000					34,823 hrs.; $1,670,766 (reduction)

13. ESTIMATE OF THE TOTAL ANNUAL COST BURDEN TO RESPONDENTS²⁵

There is no start-up, capital, or other non-labor hour cost associated with the PRA aspects of this NOPR in RM16-22; all costs are associated with burden hours and are addressed in Questions 12 and 15.

14. ESTIMATED ANNUALIZED COST TO FEDERAL GOVERNMENT

The Regional Entities and NERC do most of the data processing, monitoring and compliance work for Reliability Standards. Any involvement by the Commission is covered under the FERC-725 collection (OMB Control No. 1902-0225) and is not part of this request or package.

The PRA Administrative Cost (estimate of $5,723 per collection annually) is a Federal Cost associated with preparing, issuing, and submitting materials necessary to comply with the Paperwork Reduction Act of 1995 (PRA) for rulemakings, orders, or any other vehicle used to create, modify, extend, or discontinue an information collection. This average annual cost includes requests for extensions, all associated rulemakings or orders, and other changes to the collection.

	Number of Employees (FTE)	Estimated Annual Federal Cost
Analysis and Processing of filings26	0	0
PRA Administrative Cost ($5,723 each for FERC-725G6 and FERC-725Y)		$11,446
FERC Total		$11,446

15. REASONS FOR CHANGES IN BURDEN INCLUDING THE NEED FOR ANY INCREASE

The purpose of proposed Reliability Standard PRC-027-1 (under FERC-725G6) is to maintain the coordination of protection systems installed to detect and isolate faults on bulk electric system elements, such that those protection systems operate in the intended sequence during faults. The purpose of proposed Reliability Standard PER-006-1 (under FERC-725Y) is to ensure that personnel are trained on specific topics essential to reliability to perform or support real-time operations of the bulk electric system. The Commission also proposes to approve the associated violation risk factors, violation severity levels, implementation plans, and effective dates proposed by NERC for Reliability Standards PRC-027-1 and PER-006-1. The Commission further proposes to approve the retirement of currently-effective Reliability Standard PRC 001 1.1(ii) (System Protection Coordination) (currently covered by FERC-725A).

The following tables summarize the changes in burden and responses to FERC-725Y and FERC-725G6 due to the NOPR in RM16-22 (with each respondent having a recordkeeping and reporting requirement). ¹

Please note that, as shown in Question 12, the net estimated annual burden reduction to industry (due to the NOPR in RM16-22) affecting FERC-725Y, FERC-725G6, and FERC-725A, is 34,823 hrs. ²⁷

FERC-725Y	Total Request	Previously Approved	Change due to Adjustment in Estimate	Change Due to Agency Discretion
Annual Number of Responses	3,407	2,532		+ 875
Annual Time Burden (Hr.)	40,588	27,463		+13,125
Annual Cost Burden ($)	0	0	0	0

FERC-725G6	Total Request	Previously Approved	Change due to Adjustment in Estimate	Change Due to Agency Discretion
Annual Number of Responses	1,612	0	0	+1,612
Annual Time Burden (Hr.)	58,960	0	0	+58,960
Annual Cost Burden ($)	0	0	0	0

16. TIME SCHEDULE FOR PUBLICATION OF DATA

There are no data publications.

17. DISPLAY OF EXPIRATION DATE

The PRA information (including expiration dates and OMB Control Nos.) is posted at http://www.ferc.gov/docs-filing/info-collections.asp.

18. EXCEPTIONS TO THE CERTIFICATION STATEMENT

The Commission does not use statistical methods for these collections.

1 On an administrative note, this consolidated supporting statement should be submitted in FERC-725A (OMB Control No. 1902-0244), FERC-725G (OMB Control No. 1902-0252), and FERC-725Y. However, there are other unrelated items pending at OMB in FERC-725A and FERC-725G, and only one item per OMB Control No. can be pending OMB review at a time. As a result, we are having to make two adjustments in order to submit timely, to OMB, the NOPR in Docket No. RM16-22 with the related Paperwork Reduction Act materials.

1. The NOPR proposes to retire Reliability Standard PRC-001-1.1 and to reduce burden (in FERC-725A). FERC is not taking the reduction to FERC-725A at this time. Estimates for the burden reduction are included in the NOPR and this supporting statement in #12, in order to solicit public comments, although an ICR cannot be submitted at this time for FERC-725A.

2. We are using FERC-725G6, a temporary ‘placeholder’ information collection number (rather than FERC-725G) for the NOPR.

2 The standards being proposed are included in two ‘families’ of NERC Reliability standards: a) Personnel Performance, Training, and Qualifications (PER ), and b)Protection and Control (PRC).

The proposed standards are available in FERC’s eLibrary as attachments (at https://elibrary.ferc.gov/idmws/common/OpenNat.asp?fileID=14345794) to NERC’s Petition and on NERC’s website at http://www.nerc.net/standardsreports/standardssummary.aspx.

3 The Energy Policy Act of 2005, Pub. L. No 109-58, Title XII, Subtitle A, 119 Stat. 594, 941 (2005), codified at 16 U.S.C. 824o (2006).

4 Id. 824o(c), (d).

5 Id. 824o(e).

6 North American Electric Reliability Corp., 116 FERC ¶ 61,062, order on reh’g and compliance, 117 FERC ¶ 61,126 (2006), order on compliance, 118 FERC ¶ 61,190, order on reh’g, 119 FERC ¶ 61,046 (2007), aff’d sub nom. Alcoa Inc. v. FERC, 564 F.3d 1342 (D.C. Cir. 2009).

7 FERC-725G6 is a new temporary ‘placeholder’ information collection number; the background is the same for FERC-725G (in which the new requirements would normally go).

8 The reporting and recordkeeping requirements of Reliability Standard PRC-023-1 are included under FERC-725G and were approved by OMB in ICR 201004-1902-003.

9 Order No. 733, 130 FERC ¶ 61,221 at P 150.

10 Id. PP 3-4, 130 (citing U.S.-Canada Power System Outage Task Force, Final Report on the August 14, 2003 Blackout in the United States and Canada: Causes and Recommendations, at 80 (2004); and August 14, 2003 Blackout: NERC Actions to Prevent and Mitigate the Impacts of Future Cascading Blackouts, at 13 (2004)).

11 Id. P 153.

12 Proposed Reliability Standards PRC-027-1 and PER-006-1 are not attached to this Notice of Proposed Rulemaking. The proposed Reliability Standards are available on the Commission’s eLibrary document retrieval system in Docket No. RM16-22-000 and are posted on the NERC website, http://www.nerc.com.

13 NERC Petition at 10.

14 https://elibrary.ferc.gov/idmws/common/opennat.asp?fileID=14345793

15 Details of the current ERO Reliability Standard processes are available on the NERC website.

16 Details of the current ERO Reliability Standard processes are available on the NERC website at http://www.nerc.com/FilingsOrders/us/RuleOfProcedureDL/Appendix_3A_StandardProcessesManual_20130626.pdf.

17 https://elibrary.ferc.gov/idmws/common/opennat.asp?fileID=14758358

18 TO=transmission owner; TOP=transmission operator; GO=generator owner; GOP=generator operator; DP=distribution provider; and BA=balancing authority.

19 For each Reliability Standard, the Measure shows the acceptable evidence for the associated Reporting Requirement, and the Compliance section details the related Recordkeeping Requirement.

20 Based on data from the Bureau of Labor Statistics, the average hourly cost (wages plus benefits) is $65.69/hour for an engineer, and $39.14/hour for a record clerk. The hourly cost for an engineer is used for reporting requirements; the hourly cost for a record clerk is used for recordkeeping requirements.

21 For display purposes, the cost figures in column 5 have been rounded.

22 Some of the reporting requirements are required at least every six calendar years. In this table, the Commission assumes that respondents might work on some of their elements each year; the annual burden estimate shown is one sixth of the burden associated with one complete six-year cycle. For example, for each transmission owner: (a) the annual reporting burden associated with Requirements R1, R2, and R3 is shown as 60 hours per year, and (b) the burden for the six-year cycle would be six times that, or a total of 360 hours.

23 The previous version of the standard (PER-005-1) is included in (and a very small component of) FERC-725A (“Mandatory Reliability Standards for Bulk-Power System”) and will be removed from FERC-725A in the future. (The existing annual burden inventory for the entire FERC-725A collection is approximately 1.8 million burden hours. Initially, FERC-725A contained the information collection requirements for nearly all of the U.S.-wide Reliability Standards and was started in 2007 when FERC approved 83 Reliability Standards with an estimated 1,252,680 burden hours.)

In order to provide improved information on the standard and associated burden, FERC-725Y (rather than FERC-725A) will cover the additional burden required by PER-006-1.

24 The estimates for average annual burden hours per response are based on Order No. 693 at PP 1906, 1907. The numbers of respondents and estimated hourly costs are based on current figures.

25 Under NERC’s compliance registration program, entities may be registered for multiple functions, so the numbers incorporate some double counting.

26 Based upon FERC’s 2017 FTE average salary plus benefits ($158,754)

27 The estimated reduction to the FERC-725A is detailed in Question 12 (and not able to be taken at this time, as discussed in Footnote 1) is 106, 908 hrs.