RM19-16, NERC Petition #1

UNITED STATES OF AMERICA
BEFORE THE
FEDERAL ENERGY REGULATORY COMMISSION
North American Electric Reliability
Corporation

)

Docket No. _________

)

PETITION OF THE
NORTH AMERICAN ELECTRIC RELIABILITY CORPORATION
FOR APPROVAL OF RELIABILITY STANDARDS IRO-002-7, TOP-001-5, AND
VAR-001-6 DEVELOPED UNDER THE NERC STANDARDS EFFICIENCY REVIEW

Lauren A. Perotti
Senior Counsel
North American Electric Reliability Corporation
1325 G Street, N.W., Suite 600
Washington, D.C. 20005
(202) 400-3000
(202) 644-8099 – facsimile
[email protected]
Counsel for the North American Electric
Reliability Corporation

June 7, 2019

TABLE OF CONTENTS
THE STANDARDS EFFICIENCY REVIEW AND SUMMARY OF PROPOSALS ....... 3
NOTICES AND COMMUNICATIONS ............................................................................. 7
BACKGROUND .................................................................................................................. 7
Regulatory Framework .................................................................................................... 7
NERC Reliability Standards Development Procedure .................................................... 8
Project 2018-03 Standards Efficiency Review Retirements ............................................ 9
JUSTIFCATION FOR APPROVAL ................................................................................. 10
Reliability Standards IRO-002-7 and TOP-001-5 ......................................................... 11
Reliability Standard VAR-001-6 ................................................................................... 18
Enforceability of the Proposed Reliability Standards .................................................... 22
EFFECTIVE DATE ........................................................................................................... 22
CONCLUSION .................................................................................................................. 24

i

Exhibit A

Exhibit B
Exhibit C
Exhibit D

Exhibit E
Exhibit F
Exhibit G

The proposed Reliability Standards
Exhibit A-1: Proposed Reliability Standard IRO-002-7
Clean
Redline to Last Approved (IRO-002-5)
Exhibit A-2: Proposed Reliability Standard TOP-001-5
Clean
Redline to Last Approved (TOP-001-4)
Exhibit A-3: Proposed Reliability Standard VAR-001-6
Clean
Redline to Last Approved (VAR-001-5)
Implementation Plan
Order No. 672 Criteria
Analysis of Violation Risk Factors and Violation Severity Levels
Exhibit D-1: Proposed Reliability Standard IRO-002-7
Exhibit D-2: Proposed Reliability Standard TOP-001-5
Exhibit D-3: Proposed Reliability Standard VAR-001-6
Technical Rationale
Summary of Development and Complete Record of Development
Standard Drafting Team Roster, Project 2018-03 Standards Efficiency Review
Retirements

ii

UNITED STATES OF AMERICA
BEFORE THE
FEDERAL ENERGY REGULATORY COMMISSION
North American Electric Reliability
Corporation

)

Docket No. ________

)

PETITION OF THE
NORTH AMERICAN ELECTRIC RELIABILITY CORPORATION
FOR APPROVAL OF RELIABILITY STANDARDS IRO-002-7, TOP-001-5, AND
VAR-001-6 DEVELOPED UNDER THE NERC STANDARDS EFFICIENCY REVIEW
Pursuant to Section 215(d)(1) of the Federal Power Act (“FPA”) 1 and Section 39.5 2 of the
Federal Energy Regulatory Commission’s (“FERC” or “Commission”) regulations, the North
American Electric Reliability Corporation (“NERC”) 3 hereby submits for Commission approval
three proposed Reliability Standards: (1) proposed Reliability Standard IRO-002-7 – Reliability
Coordination – Monitoring and Analysis; (2) proposed Reliability Standard TOP-001-5 –
Transmission Operations; and (3) proposed Reliability Standard VAR-001-6 – Voltage and
Reactive Control. The proposed Reliability Standards reflect the retirement of individual
requirements from the currently effective versions of the standards. As discussed herein, these
requirements, which relate to planning for next-day operations, are redundant to other Reliability
Standard requirements and should be retired.
The proposals discussed in this petition originate from the first phase of work under
NERC’s Standards Efficiency Review. This initiative, which began in 2017, reviewed the body of
NERC Reliability Standards to identify those Reliability Standards and requirements that were

1

16 U.S.C. § 824o (2012).
18 C.F.R. § 39.5 (2018).
3
The Commission certified NERC as the electric reliability organization (“ERO”) in accordance with Section
215 of the FPA on July 20, 2006. N. Am. Elec. Reliability Corp., 116 FERC ¶ 61,062 (2006), order on reh’g &
compliance, 117 FERC ¶ 61,126 (2006), aff’d sub nom. Alcoa, Inc. v. FERC, 564 F.3d 1342 (D.C. Cir. 2009).
2

1

administrative in nature, duplicative to other standards, or provided no benefit to reliability. The
retirement proposals described in this petition, and in a concurrently-filed petition addressing the
Facilities Design, Connections, and Maintenance (“FAC”), Interchange Scheduling and
Coordination (“INT”), Modeling, Data, and Analysis (“MOD”), and Protection and Control
(“PRC”) families of Reliability Standards, 4 would help achieve a more streamlined, effective, and
efficient body of Reliability Standards.
NERC requests that the Commission approve the proposed Reliability Standards, as shown
in Exhibit A, as just, reasonable, not unduly discriminatory or preferential, and in the public
interest. NERC requests that the Commission also approve: (i) the implementation plan (Exhibit
B); (ii) the associated Violation Risk Factors (“VRFs”) and Violation Severity Levels (Exhibit
D), which are generally unchanged from the currently effective versions of those standards; and
(iii) the retirement of currently effective Reliability Standards TOP-001-4 and VAR-001-5 and
proposed Reliability Standard IRO-002-6.
As required by Section 39.5(a) 5 of the Commission’s regulations, this petition presents the
technical basis and purpose of the proposed Reliability Standards, a demonstration that the
proposed Reliability Standards continue to meet the criteria identified by the Commission in Order
No. 672 6 (Exhibit C), and a summary of the standard development history (Exhibit F). The NERC
Board of Trustees adopted the proposed Reliability Standards on May 9, 2019.

4

Petition of the North American Electric Reliability Corporation for Approval of Revised and Retired
Reliability Standards under the NERC Standards Efficiency Review, filed June 7, 2019 (docket pending).
5
18 C.F.R. § 39.5(a).
6
The Commission specified in Order No. 672 certain general factors it would consider when assessing whether
a particular Reliability Standard is just and reasonable. See Rules Concerning Certification of the Electric Reliability
Organization; and Procedures for the Establishment, Approval, and Enforcement of Electric Reliability Standards,
Order No. 672, 114 FERC ¶ 61,104 at P 262, 321-37 (“Order No. 672”), order on reh’g, Order No. 672-A, 114 FERC
¶ 61,328 (2006).

2

This petition is organized as follows: Section I of the petition presents an overview of the
Standards Efficiency Review and a summary of the proposals in this filing. Section II of the
petition provides the individuals to whom notices and communications related to the filing should
be provided. Section III provides background on the regulatory structure governing the Reliability
Standards approval process. This section also provides information on the development of the
proposals through Project 2018-03 Standards Efficiency Review Retirements. Section IV of the
petition provides an overview of each of the Reliability Standard proposals and the justification
supporting the proposals. Section V of the petition provides a summary of the proposed
implementation plan.
THE STANDARDS EFFICIENCY REVIEW AND SUMMARY OF PROPOSALS
NERC’s mission is to assure effective and efficient reduction of risks to the reliability and
security of the North American Bulk Power System (“BPS”). 7 Mandatory Reliability Standards
play an integral role in helping NERC achieve its mission of a highly reliable and secure grid.
After a decade of developing and implementing mandatory Reliability Standards in the United
States, NERC launched the Standards Efficiency Review in 2017. This comprehensive, multi-year
review project comprises a key element of NERC’s plan to achieve its long-term strategic goal of
establishing risk-based controls to minimize BPS reliability risk while also driving operational
efficiencies and effectiveness. 8 This project also marks an important milestone in the maturity of
NERC’s standard development program.

7
Unless otherwise indicated, capitalized terms used in this Petition shall have the meaning set forth in the
Glossary of Terms Used in NERC Reliability Standards (“NERC Glossary”),
https://www.nerc.com/pa/Stand/Glossary%20of%20Terms/Glossary_of_Terms.pdf.
8
See ERO Enterprise Long-Term Strategy (Nov. 2017), available on NERC’s website at
https://www.nerc.com/AboutNERC/Pages/Strategic-Documents.aspx.

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The Commission approved the first set of mandatory Reliability Standards in Order No.
693, issued in 2007. 9 In the intervening years, NERC invested significant resources to develop
new and revised mandatory Reliability Standards to address Commission directives and emerging
risks. NERC also invested significant time and effort to improve the quality, content, and
organization of Reliability Standards. Notable achievements include:
•

The evolution in standards-writing from a highly detailed, prescriptive approach to one
that is “results-based,” whereby standards are written to provide entities with built-in
flexibility to achieve the stated reliability goal.

•

The retirement of 34 Reliability Standard requirements that were redundant,
administrative, or otherwise unnecessary and where violations posed a lesser risk to the
reliability of the BPS, under the “paragraph 81” project. 10

•

The revision and streamlining of entire families of Reliability Standards, including the
INT Reliability Standards 11 and the Transmission Operations (“TOP”) and
Interconnection Reliability Operations and Coordination (“IRO”) Reliability
Standards. 12

•

Implementation of enhanced processes for performing periodic reviews of Reliability
Standards, including a new grading process to measure content and quality.

In addition to these standards development-related efforts, NERC and the Regional Entities
have completed the implementation of risk-based compliance and enforcement processes across
the ERO Enterprise.
Through its experience successfully completing over 100 standards projects, and informed
by the improvement efforts highlighted above, NERC has developed a more sophisticated

9

Mandatory Reliability Standards for the Bulk-Power System, Order No. 693, 118 FERC ¶ 61,218, order on
reh’g, Order No. 693-A, 120 FERC ¶ 61,053 (2007) (“Order No. 693”).
10
The Commission approved the “paragraph 81” retirements in 2013. See Electric Reliability Organization
Proposal to Retire Requirements in Reliability Standards, Order No. 788, 145 FERC ¶ 61,147 (2013).
11
The Commission approved the revised INT standards in 2014. See N. Am. Elec. Reliability Corp., Docket
No. RD14-4-000 (June 30, 2014) (delegated letter order).
12
The Commission approved the revised TOP and IRO Reliability Standards in 2015. Transmission Operations
Reliability Standards and Interconnection Reliability Operations and Coordination Reliability Standards, Order No.
817, 153 FERC ¶ 61,178 (2015) (“Order No. 817”).

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understanding of what a Reliability Standard should be and how it should be written. With the
benefit of experience, NERC determined that it was an appropriate time to initiate a comprehensive
and critical review of the body of NERC Reliability Standards. At this time, approximately 475
continent-wide Reliability Standard requirements are in effect in the United States, addressing
various aspects of BPS planning, operations, and cyber and physical security. NERC initiated the
Standards Efficiency Review to determine whether there were opportunities to improve the overall
effectiveness and efficiency of its Reliability Standards consistent with its regulatory philosophy,
which consists of several key elements including the following:
•

Reliability Standards should be developed using a results-based approach that
focuses on performance, risk management, and entity capabilities, rather than
prescribing specific processes for an entity to follow.

•

Reliability Standards should be focused on advancing reliability; they should not
prescribe commercial business practices which do not contribute directly to
reliability.

•

Reliability Standard requirements should be organized logically and efficiently,
both to aid ease of use and to avoid duplication and conflict among requirements.

For the first phase of work, review teams consisting of industry experts in Real-time
operations, long-term planning, and operations planning performed a comprehensive review of the
operations and planning Reliability Standards (i.e., excluding the Critical Infrastructure Protection
(“CIP”) Reliability Standards). The purpose of this review was to identify Reliability Standard
requirements that provide little or no benefit to reliability and should be retired. An important part
of this review was exploring the relationships between the different Reliability Standards in a
deeper way than would be feasible during a targeted periodic review of a Reliability Standard or
Reliability Standard family. This in-depth review allowed NERC to identify redundancies among
the requirements, the removal of which would improve administrative efficiency without harming
reliability. The review process was conducted in an open and transparent manner, with broad

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industry participation. NERC then initiated the standard development process to consider the
retirement recommendations resulting from the phase one work.
As discussed more fully in this petition, NERC proposes revisions to the IRO-002, TOP001, and VAR-001 Reliability Standards which would result in the retirement of four requirements
related to planning for next-day operations. Three of the requirements, in the IRO-002 and TOP001 Reliability Standards, require the Reliability Coordinator, Transmission Operator, and
Balancing Authority to have data exchange capabilities with the entities from which it needs data
to perform Operational Planning Analyses and to develop Operating Plans for next-day operations.
The remaining requirement, in the VAR-001 Reliability Standard, requires the Transmission
Operator to schedule sufficient reactive resources to regulate voltage levels under normal and
Contingency conditions.
Through the review process described above, NERC determined that these four
requirements are in fact redundant to other Reliability Standards, because the performance required
by these requirements is inherent to the performance of other Reliability Standard requirements.
Retirement of these requirements would not have an adverse impact to reliability. Retiring
redundant requirements would benefit reliability by allowing entities to focus their resources on
those Reliability Standard requirements that promote the reliable operation and planning of the
BPS and avoid unnecessary compliance burdens. NERC therefore respectfully requests that the
Commission approve the proposed Reliability Standards described in this petition as just,
reasonable, not unduly discriminatory or preferential, and in the public interest.
Work continues under the second phase of the Standard Efficiency Review to consider
recommendations for Reliability Standard revisions which would further improve the efficiency
of the body of NERC Reliability Standards, such as through consolidation of Reliability Standard

6

requirements. The review teams are also expected to consider recommendations for standardsbased improvements that would further reduce inefficiencies and promote effectiveness going
forward. NERC would submit separate filings to address any such proposals requiring Commission
approval at the appropriate time.
NOTICES AND COMMUNICATIONS
Notices and communications with respect to this filing may be addressed to the following:
Lauren A. Perotti
Senior Counsel
North American Electric Reliability
Corporation
1325 G Street, N.W., Suite 600
Washington, D.C. 20005
(202) 400-3000
(202) 644-8099 – facsimile
[email protected]

Howard Gugel
Vice President and Director of Engineering and Standards
North American Electric Reliability Corporation
3353 Peachtree Road, N.E.
Suite 600, North Tower
Atlanta, GA 30326
(404) 446-2560
(404) 446-2595 – facsimile
[email protected]

BACKGROUND
Regulatory Framework
By enacting the Energy Policy Act of 2005, 13 Congress entrusted the Commission with the
duties of approving and enforcing rules to ensure the reliability of the BPS, and with the duties of
certifying an ERO that would be charged with developing and enforcing mandatory Reliability
Standards, subject to Commission approval. Section 215(b)(1) 14 of the FPA states that all users,
owners, and operators of the BPS in the United States will be subject to Commission-approved
Reliability Standards. Section 215(d)(5) 15 of the FPA authorizes the Commission to order the ERO
to submit a new or modified Reliability Standard. Section 39.5(a) 16 of the Commission’s

13
14
15
16

16 U.S.C. § 824o.
Id. § 824o(b)(1).
Id. § 824o(d)(5).
18 C.F.R. § 39.5(a).

7

regulations requires the ERO to file with the Commission for its approval each new Reliability
Standard that the ERO proposes should become mandatory and enforceable in the United States,
and each modification to a Reliability Standard that the ERO proposes should be made effective.
The Commission is vested with the regulatory responsibility to approve Reliability
Standards that protect the reliability of the BPS and to ensure that Reliability Standards are just,
reasonable, not unduly discriminatory or preferential, and in the public interest. Pursuant to
Section 215(d)(2) of the FPA 17 and Section 39.5(c) 18 of the Commission’s regulations, the
Commission will give due weight to the technical expertise of the ERO with respect to the content
of a Reliability Standard.
NERC Reliability Standards Development Procedure
The proposed Reliability Standards and retirements discussed in this petition were
developed in an open and fair manner and in accordance with the Commission-approved
Reliability Standard development process. NERC develops Reliability Standards in accordance
with Section 300 (Reliability Standards Development) of its Rules of Procedure and the NERC
Standard Processes Manual. 19
In its order certifying NERC as the Commission’s ERO, the Commission found that
NERC’s rules provide for reasonable notice and opportunity for public comment, due process,
openness, and a balance of interests in developing Reliability Standards, 20 and thus satisfy several
of the Commission’s criteria for approving Reliability Standards. 21 The development process is

17

16 U.S.C. § 824o(d)(2).
18 C.F.R. § 39.5(c)(1).
19
The NERC Rules of Procedure, including Appendix 3A, NERC Standard Processes Manual, are available at
http://www.nerc.com/AboutNERC/Pages/Rules-of-Procedure.aspx.
20
N. Am. Elec. Reliability Corp., 116 FERC ¶ 61,062 at P 250 (2006).
21
Order No. 672 at PP 268, 270.
18

8

open to any person or entity with a legitimate interest in the reliability of the BPS. NERC considers
the comments of all stakeholders. Stakeholders must approve, and the NERC Board of Trustees
must adopt, a new or revised Reliability Standard before NERC submits the Reliability Standard
to the Commission for approval. Similarly, stakeholders and the NERC Board of Trustees must
approve the retirement of a Reliability Standard before the retirement is submitted to the
Commission for approval.
Project 2018-03 Standards Efficiency Review Retirements
In 2018, NERC initiated Project 2018-03 Standards Efficiency Review Retirements to
consider the Reliability Standard Retirement recommendations from the first phase of the
Standards Efficiency Review. In total, the Project 2018-03 standard drafting team evaluated
recommendations from the Standards Efficiency Review to: (i) withdraw one proposed Reliability
Standard in its entirety, consisting of six requirements; and (ii) retire 99 Reliability Standard
requirements and one requirement part, including the retirement of 12 Reliability Standards in their
entirety.
For the reasons explained in Exhibit E, the standard drafting team determined to: (i)
withdraw one proposed Reliability Standard; and (ii) retire 77 Reliability Standard requirements
and one requirement part, including the four requirements in the IRO-002, TOP-001, and VAR001 Reliability Standards that are addressed in this petition.
The proposed Reliability Standards were posted for formal comment and ballot from
February 27, 2019 to April 12, 2019 and for final ballot from April 23, 2019 to May 2, 2019.
Having achieved the requisite quorum and ballot body approval percentages, the NERC Board of
Trustees adopted the proposed Reliability Standards on May 9, 2019. A summary of the

9

development history and the complete record of development is attached to this petition as Exhibit
F.
JUSTIFCATION FOR APPROVAL
In this petition, NERC proposes for Commission approval three revised Reliability
Standards in which requirements from the currently effective Reliability Standards are proposed
to be retired:
•

IRO-002-7 – Reliability Coordination – Monitoring and Analysis (retiring
Requirement R1)

•

TOP-001-5 – Transmission Operations (retiring Requirements R19 and R22)

•

VAR-001-6 – Voltage and Reactive Control (retiring Requirement R2).

For the reasons set forth below, NERC has determined that none of the requirements
proposed for retirement in the proposed Reliability Standards are necessary for reliability because
the required performance is addressed adequately through other Reliability Standards. NERC has
determined that, in the interest of advancing an efficient and effective body of Reliability Standards
that removes redundant requirements as they are identified and eliminates unnecessary compliance
documentation burdens, these requirements should be retired. Three of the requirements proposed
for retirement in proposed Reliability Standards IRO-002-7 and TOP-001-5 relate to data exchange
capabilities for Operational Planning Analyses and next-day operations. As the requirements and
rationale for retirement are similar, NERC addresses them together in Section IV.A. The retirement
of Requirement R2 in proposed Reliability Standard VAR-001-6 is discussed separately in Section
IV.B.
As shown in the redlines included in Exhibit A, for each instance in which NERC has
proposed to retire a Reliability Standard requirement, NERC has struck the Retirement in its
entirety and replaced the text with the word “Reserved.” Corresponding revisions have also been

10

made to the VRFs, VSLs, measures, and, where present, the supplemental material included as
information.
Reliability Standards IRO-002-7 and TOP-001-5
This section provides the relevant procedural history of the IRO-002 and TOP-001
Reliability Standards and the rationale for the proposed requirement retirements reflected in
proposed Reliability Standards IRO-002-7 and TOP-001-5.
Procedural History
In Order No. 817, the Commission approved a suite of revised TOP and IRO Reliability
Standards, including Reliability Standards IRO-002-4 – Reliability Coordination – Monitoring and
Analysis and TOP-001-3 – Transmission Operations. 22 In the underlying proceeding, the
Commission stated that Reliability Standards IRO-002-4 and TOP-001-3 appeared to address
facilities for data exchange capabilities, an issue it previously raised in the proceeding for approval
of Reliability Standard COM-001-2. 23 In Order No. 817, the Commission directed NERC to revise
the standards to address, among other things, redundancy and diverse routing of Transmission
Operator, Balancing Authority, and Reliability Coordinator data exchange capabilities and testing
of alternative or less frequently used data exchange capabilities. 24
NERC developed currently effective Reliability Standards IRO-002-5 – Reliability
Coordination – Monitoring and Analysis and TOP-001-4 – Transmission Operations to address
the Order No. 817 directives. Among other things, NERC revised three requirements related to
Reliability Coordinator, Transmission Operator, and Balancing Authority data exchange

22

Transmission Operations Reliability Standards and Interconnection Reliability Operations and Coordination
Reliability Standards, Order No. 817, 153 FERC ¶ 61,178 (2015) (“Order No. 817”).
23
Transmission Operations Reliability Standards and Interconnection Reliability Operations and Coordination
Reliability Standards, Notice of Proposed Rulemaking, 151 FERC ¶ 61,236 at P 67-68 (2015) (citing Order No. 808,
151 FERC ¶ 61,039 at P 54 (2015)).
24
Order No. 817 at PP 47, 51.

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capabilities (IRO-002-4 R1, TOP-001-3 R19 and R20). Previously, these requirements provided
that the Reliability Coordinator, Transmission Operator, and Balancing Authority have data
exchange capabilities with the entities from which data is needed to maintain reliability in the
applicable entity’s area. NERC revised these requirements to apply only to data exchange
capabilities for the exchange of data needed for Operational Planning Analyses and Balancing
Authority next-day Operating Plans, and it added new requirements to require that Reliability
Coordinators, Transmission Operators, and Balancing Authorities have data exchange capabilities
for the exchange of Real-time data needed for Real-time Assessments and Real-time monitoring
that are redundant and diversely routed within the entity’s primary Control Center. 25 The
Commission approved Reliability Standards IRO-002-5 and TOP-001-4 in 2017. 26
On May 30, 2019, NERC filed with the Commission a petition for approval of proposed
Reliability Standard IRO-002-6, reflecting the addition of a new Variance for entities in the
Western Electricity Coordinating Council region. 27 None of the continent-wide requirements were
changed in this version.
Justification
The purpose of proposed Reliability Standard IRO-002-7, which remains unchanged from
the currently effective version, is “to provide System Operators with the capabilities necessary to
monitor and analyze data needed to perform their reliability functions.” The purpose of proposed
Reliability Standard TOP-001-5, which likewise remains unchanged, is “to prevent instability,

25

See Petition of NERC for Approval of Proposed Reliability Standards IRO-002-5 and TOP-001-4, Docket
No. RD17-4-000 (Mar. 6, 2017) at 12-15.
26
N. Am. Elec. Reliability Corp., Docket No. RD17-4-000 (Apr. 17, 2017) (delegated letter order).
27
Joint Petition of NERC and WECC for Approval of Proposed Reliability Standard IRO-002-6, Docket No.
RD19-6-000 (May 30, 2019).

12

uncontrolled separation, or Cascading outages that adversely impact the reliability of the
Interconnection by ensuring prompt action to prevent or mitigate such occurrences.”
In this petition, NERC proposes to revise the IRO-002 and TOP-001 Reliability Standards
to retire three similar requirements related to data exchange capabilities for data needed for nextday planning because they are redundant to other requirements in the TOP and IRO Reliability
Standards. Specifically, NERC proposes to retire Requirement R1 from currently effective
Reliability Standard IRO-002-5 and Requirements R19 and R22 from currently effective
Reliability Standard TOP-001-4.
When these data exchange capabilities requirements were originally developed in
Reliability Standards IRO-002-4 and TOP-001-3, NERC believed that they were necessary as part
of the overall framework of the TOP and IRO Reliability Standards. 28 Following revisions to these
requirements, and upon further analysis of the relationships between the TOP and IRO Reliability
Standards, NERC has concluded that Reliability Standard IRO-002-5 Requirement R1 and TOP001-4 Requirements R19 and R22 are in fact redundant to other Reliability Standard requirements
in the TOP and IRO Reliability Standards and provide no additional benefit to reliability. As
explained below, other Reliability Standard requirements work together to require the same
performance addressed in the requirements proposed for retirement.
In summary, each Reliability Coordinator, Transmission Operator, or Balancing Authority
cannot perform the required Operational Planning Analyses or develop Operating Plans for nextday operations unless it obtains the data it needs from the relevant reporting entities, as set forth
in its data specification. The relevant reporting entities cannot “satisfy” the obligations of such a

28
See, e.g., Petition of NERC for Approval of Proposed Transmission Operations and Interconnection
Reliability Operations and Coordination Reliability Standards at 26 and Exhibit A, Reliability Standard IRO-002-4,
Rationale, Docket No. RM15-16-000 (filed March 18, 2015).

13

data specification using mutually agreeable protocols unless they have some data exchange
capability in place with the Reliability Coordinator, Transmission Operator, or Balancing
Authority providing the specification. Thus, the obligation to have data exchange capabilities for
Operational Planning Analyses and Operating Plans for next-day operations is inherent to the
performance of these other Reliability Standard requirements, regardless of whether there is a
separate Reliability Standard requirement expressly requiring such data exchange capabilities.
In the interest of promoting an effective and efficient body of Reliability Standards, one in
which unnecessary and redundant requirements are removed as they are identified and unnecessary
compliance documentation burdens are avoided, NERC proposes to retire these requirements in
proposed Reliability Standards IRO-002-7 and TOP-001-5.
A description of how each of these data exchange capability requirements is redundant to
other TOP and IRO Reliability Standard requirements is provided below.
IRO-002-5 Requirement R1
Reliability Standard IRO-002-5 Requirement R1 states as follows:
R1.

Each Reliability Coordinator shall have data exchange capabilities
with its Balancing Authorities and Transmission Operators, and
with other entities it deems necessary, for it to perform its
Operational Planning Analyses.

NERC proposes to retire this requirement because it is unnecessary, in light of the
performance required by other Reliability Standard requirements requiring the performance of
Operational Planning Analyses and the development and satisfaction of data specifications for
such analyses, as discussed below.
Under Reliability Standard IRO-008-2 Requirement R1, the Reliability Coordinator is
obligated to perform Operational Planning Analyses to assess whether the planned operations for
the next-day will exceed System Operating Limits and Interconnection Reliability Operating

14

Limits within its Wide Area. To perform the required Operational Planning Analysis, the
Reliability Coordinator must have the data it deems necessary from those entities that possess it.
Reliability Standard IRO-010-2 – Reliability Coordinator Data Specification and
Collection provides requirements in support of data specification and provision for Operational
Planning Analyses. The purpose of Reliability Standard IRO-010-2 is “to prevent instability,
uncontrolled separation, or Cascading outages that adversely impact reliability, by ensuring the
Reliability Coordinator has the data it needs to monitor and assess the operation of its Reliability
Coordinator Area” (emphasis added). Reliability Standard IRO-010-2 requires the Reliability
Coordinator to maintain a documented specification for the data necessary for it to perform its
Operational Planning Analyses (Requirement R1) and to distribute the specification to the entities
from which it needs data (Requirement R2). Requirement R3 of the standard requires the entities
receiving a data specification to satisfy it using a mutually agreeable format (R3.1), mutually
agreeable process for resolving data conflicts (R3.2), and mutually agreeable security protocol
(R.3.3).
For these obligations to be met, the Reliability Coordinator and the reporting entity must
have data exchange capabilities in place. This is true regardless of whether a separate requirement
expressly requires the Reliability Coordinator to have data exchange capabilities in place. There is
no independent reliability benefit to having a separate requirement expressly requiring data
exchange capabilities to reinforce what is already required by the performance of these other
obligations. Reliability Standard IRO-002-5 Requirement R1 is therefore unnecessary and
redundant and should be retired.

15

TOP-001-4 Requirements R19 and R22
Reliability Standard TOP-001-4 contains Requirements for data exchange capabilities
applicable to the Transmission Operator and Balancing Authority as follows:
R19.

Each Transmission Operator shall have data exchange capabilities
with the entities it has identified it needs data from in order to
perform its Operational Planning Analyses.
***

R22.

Each Balancing Authority shall have data exchange capabilities with
the entities it has identified it needs data from in order to develop its
Operating Plan for next-day operations.

NERC proposes to retire these requirements because they are unnecessary, in light of the
performance required by other Reliability Standard requirements requiring the performance of
Operational Planning Analyses and the development of Operating Plans for next-day operations,
and the development and satisfaction of data specifications for such analyses.
Under Requirement R1 of Reliability Standard TOP-002-4 – Operations Planning, the
Transmission Operator is obligated to perform Operational Planning Analyses that will allow it
assess whether its planned operations for the next day within its Transmission Operator Area will
exceed any of its System Operating Limits. Under Requirement R4, the Balancing Authority shall
have an Operating Plan(s) for the next day that addresses expected generation resource
commitment and dispatch, Interchange scheduling, demand patterns, and capacity and energy
reserve requirements, including deliverability capacity. To develop the required Operational
Planning Analyses and next-day Operating Plans, each Transmission Operator and Balancing
Authority must have the data it deems necessary from those entities that possess it.
Reliability Standard TOP-003-3 – Operational Reliability Data provides requirements in
support of data specification and provision for Operational Planning Analyses and Balancing
Authority analysis functions. The purpose of Reliability Standard TOP-003-3 is “to ensure that the
16

Transmission Operator and Balancing Authority have data needed to fulfill their operational and
planning responsibilities.” Reliability Standard TOP-003-3 requires the Transmission Operator to
maintain a documented specification for the data necessary for it to perform its Operational
Planning Analyses (Requirement R1) and to distribute the specification to the entities from which
it needs data (Requirement R3). Requirement R5 of the standard requires the entities receiving a
data specification to satisfy it using a mutually agreeable format (R5.1), mutually agreeable
process for resolving data conflicts (R5.2), and mutually agreeable security protocol (R5.3).
Similar Requirements are applicable to the Balancing Authority (Requirements R2 and R4), and
the entities receiving a data specification from the Balancing Authority (Requirement R5).
In order for these obligations to be met, each Transmission Operator and Balancing
Authority must have data exchange capabilities in place with its reporting entities. This is true
regardless of whether a separate requirement expressly requires the Transmission Operator or
Balancing Authority to have data exchange capabilities in place. There is no independent reliability
benefit to having separate requirements for Transmission Operators and Balancing Authorities that
expressly require data exchange capabilities to reinforce what is already required by the
performance of these other obligations. Reliability Standard TOP-001-4 Requirements R19 and
R22 are therefore unnecessary and redundant and should be retired.
For these reasons, NERC proposes to retire these redundant requirements in proposed
Reliability Standards IRO-002-7 and TOP-001-5. The retirement of these requirements would not
have an adverse impact on reliability and is in the public interest.

17

Reliability Standard VAR-001-6
This section provides the relevant procedural history of the VAR-001 Reliability
Standard and the rationale for the proposed retirement requirements reflected in proposed
Reliability Standard VAR-001-6.
Procedural History and Purpose
The currently effective version of the VAR-001 Reliability Standard, Reliability Standard
VAR-001-5 – Voltage and Reactive Control, was approved by the Commission in 2018. 29 This
version of the standard contains a revised Variance for the Western Electricity Coordinating
Council region; none of the continent-wide requirements were changed from the previous version.
The Commission last approved substantive revisions to the continent-wide VAR-001 requirements
in 2014, in Reliability Standard VAR-001-4. 30
Justification
The purpose of proposed Reliability Standard VAR-001-6, which remains unchanged from
the currently effective version, is “to ensure that voltage levels, reactive flows, and reactive
resources are monitored, controlled, and maintained within limits in Real-time to protect
equipment and the reliable operation of the Interconnection.”
In proposed Reliability Standard VAR-001-6, NERC proposes to retire Requirement R2 of
the currently effective standard on the basis that this requirement is redundant to those in other
Reliability Standards and is not necessary for reliability.
Reliability Standard VAR-001-5 Requirement R2 provides as follows:

29

N. Am. Elec. Reliability Corp., Docket No. RD18-8-000 (Oct. 15, 2018) (delegated letter order) (approving
revisions to the WECC Variance).
30
N. Am. Elec. Reliability Corp., Docket No. RD14-11-000 (Aug. 1, 2014) (delegated letter order).
Subsequently, the Commission approved errata versions VAR-001-4.1 and VAR-001-4.2. See N. Am. Elec. Reliability
Corp., Docket No. RD15-6-000 (Nov. 13, 2015) (delegated letter order approving VAR-001-4.1) and N. Am. Elec.
Reliability Corp., Docket No. RD17-7-000 (Sep. 26, 2017) (delegated letter order approving VAR-001-4.2).

18

R2.

Each Transmission Operator shall schedule sufficient reactive
resources to regulate voltage levels under normal and Contingency
conditions. Transmission Operators can provide sufficient reactive
resources through various means including, but not limited to,
reactive generation scheduling, transmission line and reactive
resource switching, and using controllable load.

NERC has determined that the second sentence of Requirement R2 constitutes guidance or
a measure which does not warrant a mandatory requirement provision.
NERC has determined that the first sentence of Requirement R2 is duplicative of other
requirements in the TOP Reliability Standards which direct the Transmission Operator to plan and
operate the system within System Operating Limit values (which includes system voltage limits).31
If the Transmission Operator identifies no System Operating Limit exceedances, voltage or
otherwise, then the Transmission Operator necessarily has enough reactive resources “scheduled”
to maintain the reliability of its area. The remaining requirements in the VAR-001 Reliability
Standard require the Transmission Operator to ensure that voltage, reactive flows, and reactive
resources are monitored, controlled, and maintained within limits. In consideration of the actions
required by these Reliability Standards, NERC has determined that there is no reliability need to
have a separate Reliability Standard requirement in the VAR-001 standard expressly requiring the
Transmission Operator to “schedule” sufficient reactive resources. That outcome is achieved
through the execution of the other Reliability Standard requirements described in this section.
31

System Operating Limit is defined in the NERC Glossary as:
The value (such as MW, Mvar, amperes, frequency or volts) that satisfies the most limiting
of the prescribed operating criteria for a specified system configuration to ensure operation
within acceptable reliability criteria. System Operating Limits are based upon certain
operating criteria. These include, but are not limited to:
•

Facility Ratings (applicable pre- and post-Contingency Equipment Ratings or
Facility Ratings)

•

transient stability ratings (applicable pre- and post- Contingency stability limits)

•

voltage stability ratings (applicable pre- and post-Contingency voltage stability)

•

system voltage limits (applicable pre- and post-Contingency voltage limits)

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Reliability Standard TOP-001-4 Requirement R10 32 specifies what actions the
Transmission Operator shall perform for determining System Operating Limits in its area; these
actions include monitoring Facilities in its area and obtaining status and voltages for Facilities and
non-Bulk Electric System facilities outside its area as needed. Reliability Standard TOP-002-4,
Requirement R1 requires the Transmission Operator to have an Operational Planning Analysis that
will allow it to assess whether its planned operations for the next day within its area, including any
anticipated Contingencies (and with allowance for a variety of unanticipated Contingencies), will
exceed any of its System Operating Limits. If the Transmission Operator identifies potential
System Operating Limit exceedances as a result of this analysis, the Transmission Operator shall
develop an Operating Plan for its next-day operations to address those potential exceedances.
Reliability Standard TOP-001-4 Requirement R13 requires the Transmission Operator to ensure
that a Real-time Assessment is performed at least once every 30 minutes. If a Transmission
Operator identifies a System Operating Limit exceedance, Requirement R14 requires the
Transmission Operator to initiate its Operating Plan to mitigate the exceedance. Operating Plans
address the use of reactive resources if needed to operate within System Operating Limits, as well
as any other adjustment that may needed.
The Transmission Operator uses a variety of tools to regulate voltage levels, including
reactive control. Use of Real-time Contingency Analysis tools allows the Transmission Operator
to determine specific actions to regulate voltage during Contingency conditions. The Transmission
Operator also uses Real-time monitoring, allowing it to make Real-time decisions on voltage
during normal conditions. These actions allow the Transmission Operator to quantify the use of
reactive resources. As such, a separate requirement specifying that the Transmission Operator must

32

The TOP-001-4 Requirements discussed in this section are unchanged in proposed Reliability Standard TOP001-5. See infra Section IV.A.

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schedule “sufficient” reactive resources for normal and Contingency conditions is redundant and
unnecessary for reliability.
In the planning horizon, the Transmission Planning Reliability Standard TPL-001-4 33
requires each Planning Authority and Transmission Planner to conduct studies on its System to
ensure that it operates reliably over a broad spectrum of System conditions and following a wide
range of probable Contingencies. These studies include available reactive resource capabilities. If
the System is unable to meet the performance requirements of the standard, a Corrective Action
Plan must be developed. These Corrective Action Plans may include, as necessary, the amount of
reactive resources needed. This helps to ensure that the System is planned such that the
Transmission Operator will have available an adequate number of reactive resources to operate its
area reliably during normal and Contingency conditions.
With respect to generator performance, Reliability Standard VAR-002-4.1 Requirement
R1 provides that the Generator Owner shall operate its interconnected generators in the automatic
voltage control mode or as otherwise directed by its Transmission Operator except in certain
enumerated circumstances. Requirement R2 provides that each Generator Owner shall maintain
the generator voltage or Reactive Power schedule provided by its Transmission Operator.
The Reliability Standards described above provide a comprehensive and interdependent
framework addressing System voltage needs in the operations and planning horizons. Given the
relationship between these Reliability Standards, there is no need to have a distinct requirement
expressly requiring the Transmission Operator to “schedule” sufficient reactive resources. This
performance is already accomplished through the performance of other Reliability Standard

33
On December 7, 2018, NERC filed a petition for approval of proposed Reliability Standard TPL-001-5 in
Docket No. RM19-10-000, which is pending before the Commission. This discussion is applicable to both the
currently effective and proposed versions of the TPL-001-5 standard.

21

requirements. There is no independent reliability benefit to maintaining a separate requirement to
reinforce what is already required in the performance of other requirements. In the interest of
maintaining an effective and efficient body of Reliability Standards, one in which unnecessary and
redundant requirements are eliminated, and the burdens associated with demonstrating compliance
with these redundant requirements are avoided, NERC proposes to retire Requirement R2 of the
currently effective standard in proposed Reliability Standard VAR-001-5. Its retirement would not
have an adverse impact on reliability and is in the public interest.
Enforceability of the Proposed Reliability Standards
The proposed Reliability Standards contain Violation Risk Factors (“VRFs”) and Violation
Severity Levels (“VSLs”) for each of the requirements. The VRFs and VSLs provide guidance on
the way that NERC will enforce the requirements of the proposed Reliability Standards. The VRFs
and VSLs are substantively unchanged from currently effective versions of the Reliability
Standards, reflecting only those revisions necessary to effectuate the proposed requirement
retirements. As such, they continue to comport with NERC and Commission guidelines related to
their assignment.
In addition, the proposed Reliability Standards also include measures that support the
requirements by clearly identifying what is required and how the requirement will be enforced.
The measures help ensure that the requirements will be enforced in a clear, consistent, and nonpreferential manner and without prejudice to any party. The measures are substantively unchanged
from currently enforceable versions of the Reliability Standards, reflecting only those revisions
necessary to effectuate the proposed requirement retirements.
EFFECTIVE DATE
NERC respectfully requests that the Commission approve the proposed implementation
plan attached to this petition as Exhibit B, as it relates to the proposed Reliability Standards
22

addressed in this petition. The proposed implementation plan provides that proposed Reliability
Standards IRO-002-7, TOP-001-5, and VAR-001-6 would become effective on the first day of the
first calendar quarter that is three months after applicable regulatory approval. The currently
effective versions of the standards would be retired immediately prior to the effective date of the
revised Reliability Standards. 34 This implementation timeline reflects consideration that entities
may need time to update their internal systems and documentation to reflect the new Reliability
Standard version numbers.

34

NERC’s proposed implementation plan proposes to retire Reliability Standard IRO-002-6, which is currently
pending Commission approval in Docket No. RD19-6-000. Should the Commission determine to approve proposed
Reliability Standard IRO-002-7 so that IRO-002-6 is superseded prior to ever becoming effective, NERC requests the
Commission approve the retirement of the currently effective version, Reliability Standard IRO-002-5, to be effective
immediately prior to the effective date of IRO-002-7.

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CONCLUSION
For the reasons set forth above, NERC respectfully requests that the Commission approve:
•

Proposed Reliability Standards IRO-002-7, TOP-001-5, and VAR-001-6 and the
associated elements included in Exhibit A;

•

the implementation plan included in Exhibit B; and

•

the retirement of Reliability Standards IRO-002-6, TOP-001-4, and VAR-001-5.

Respectfully submitted,
/s/ Lauren A. Perotti
Lauren A. Perotti
Senior Counsel
North American Electric Reliability Corporation
1325 G Street, N.W., Suite 600
Washington, D.C. 20005
(202) 400-3000
(202) 644-8099 – facsimile
[email protected]
Counsel for the North American Electric
Reliability Corporation
June 7, 2019

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