Mandatory Electric Reliability Standards and Transmission Expansion Suedeen G. Kelly Commissioner...
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Transcript of Mandatory Electric Reliability Standards and Transmission Expansion Suedeen G. Kelly Commissioner...
Mandatory Electric Reliability Standards and Transmission Expansion
Suedeen G. KellyCommissioner
Federal Energy Regulatory Commission
The Canadian Institute Energy Group
Transmission Planning & Reliability
Toronto, CanadaJanuary 26, 2005
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Standards and expansion go hand in hand Canada and the U.S. should continue
and expand our cooperative efforts on improving grid reliability.
We need both mandatory reliability standards and – at least in the U.S. - cost-effective transmission expansion
One without the other is simply second best
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FERC has added Reliability to the Infrastructure portion
of its Strategic Plan
Allow prompt recovery of prudent expenses to safeguard reliability, security and safety
Oversee the development and enforcement of grid-reliability standards
Work with other agencies, especially the states, to improve infrastructure security
Work with the states to support robust programs for customer demand-side participation
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Transmission infrastructure investment problems
Not just one problem Siting Uncertainty about
Restructuring Who builds? Who pays? Lack of regional overview of needs
We have many roads, few regional highways.
What can the FERC and others do?
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Lagging ElectricTransmission Investment
Half as much annual investment in 2000 as in 1975
Annual growth rates in Gen, Trans, Load
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
1989-2000
GEN TRANS LOAD
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Solutions
Generator interconnection policies Clarify transmission rights & pricing Provide incentives where effective Support others’ efforts:
FERC’s Infrastructure Conferences Improve RTO transmission planning States (NGA, MSEs, RSCs) & merchants DOE: critical infrastructure bottlenecks Legislation
Take a regional focus
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Joe McClellandDivision Director
Planning Group
Logistics & Security Group
OperationsGroup
FERC’s new Reliability Division
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FERC reliability efforts in 2004
Completion of the Blackout Report Participation in the Readiness Audits with
NERC Policy Statement – Bulk Power System
Reliability (107 FERC ¶ 61,052) Encouraging the revision of NERC standards
to be specific and enforceable (Version 0)
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More 2004 reliability efforts
Specific investigations & studies -- e.g., Vegetation Management (107 FERC ¶ 61,053)
Operator training study Coordination with the NRC for grid reliability
and nuclear plant safety issues Participation in a natural gas pipeline
disruption impact analysis Study and identification of best tools and
practices for IT functions
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Possible future FERC initiatives
Cyber security evaluations of SCADA systems and IT platforms
Reactive power oversight, including planning, operations, and compensation
Transmission planning oversight including adequacy and extreme contingency plans
Work that will be required by any reliability legislation – various rulemakings
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Reliability legislation needed
FERC would certify an Electric Reliability Organization – ERO – for the United States.
The ERO would develop reliability standards applicable in the U.S., subject to FERC approval or remand.
The ERO would enforce standards and impose penalties.Note: the ERO could not require transmission expansion – separate expansion policies needed as discussed earlier.
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After legislation passes
FERC issues a proposed rule implementing the legislation
Rulemaking process must follow the Administrative Procedures Act: notice & comment; decisions based on the record
Ex parte does not apply; no prejudgment Issue final rule within 180 days – a tight deadline
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After the final rule issues
One (or more – unlikely) parties may apply to FERC to be the ERO in the U.S.
FERC selects and certifies one ERO for the U.S.
The ERO then pursues recognition in Canada and Mexico, according to the law.
Canada and Mexico may choose to have a similar or different process.
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An International ERO
The proposed law urges the President to negotiate international ERO agreements with Canada and Mexico.
FERC, DOE and Canada have been consulting frequently for several years about working together on implementing the new law.
U.S. is committed to a cooperative effort.
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Binational ERO Oversight Group
Formed in the early Spring 2004 by the Canadian Federal-Provincial-Territorial task force, DOE, and FERC.
Government staff from NRCan, Provincial Regulators, DOE, FERC.
Identifying issues and possible solutions Have not yet involved principals Mexico to be included later
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A Cooperative Effort
Common Goal of Enhancing Reliability FERC is working in partnership with
Canadian government officials U.S. Federal and State Agencies (DOE,
NRC, DHS) NERC, regional reliability councils and
industry stakeholder groups Non-jurisdictional entities
Overlapping Roles and Responsibilities
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Examples of Issues
ERO as an International Organization Standards Development Process Regulatory Review/Approval of Standards Enforcement of Standards Intergovernmental Cooperation Other Issues: roles of regions & members
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Two Governments—One Goal
Reliability standards should be more than the “least common denominator” of the current practices of today’s grid operators.
The ERO must be an advocate for excellence in North American reliability.
Blackouts like in 2003 should be, if not a thing of the past, as rare as humanly possible.