
[Federal Register Volume 77, Number 92 (Friday, May 11, 2012)]
[Rules and Regulations]
[Pages 27574-27586]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-11316]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 40

[Docket No. RM11-20-000; Order No. 763]


Automatic Underfrequency Load Shedding and Load Shedding Plans 
Reliability Standards

AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Final rule.

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SUMMARY: Under section 215 of the Federal Power Act (FPA), the Federal 
Energy Regulatory Commission (Commission) approves Reliability 
Standards PRC-006-1 (Automatic Underfrequency Load Shedding) and EOP-
003-2 (Load Shedding Plans), developed and submitted to the Commission 
for approval by the North American Electric Reliability Corporation 
(NERC), the Electric Reliability Organization certified by the 
Commission. In addition, pursuant to section 215(d)(5) of the FPA, the 
Commission directs NERC to develop a modification to clarify the intent 
of one provision of the Reliability Standard. The approved Reliability 
Standards establish design and documentation requirements for automatic 
underfrequency load shedding programs that arrest declining frequency 
and assist recovery of frequency following system events leading to 
frequency degradation. The Commission approves, with modifications, the 
related Violation Risk Factors and Violation Severity Levels, 
implementation plan, and effective date proposed by NERC. The 
Commission also approves the regional variance for the Western 
Electricity Coordinating Council in Reliability Standard PRC-006-1.

DATES: Effective Date: This rule will become effective July 10, 2012.

FOR FURTHER INFORMATION CONTACT:
Stephanie Schmidt (Technical Information), Office of Electric 
Reliability, Division of Reliability Standards, Federal Energy 
Regulatory Commission, 888 First Street NE., Washington, DC 20426, 
(202) 502-6568, Stephanie.Schmidt@ferc.gov.
Matthew Vlissides (Legal Information), Office of the General Counsel, 
Federal Energy Regulatory Commission, 888 First Street NE., Washington, 
DC 20426, (202) 502-8408, Matthew.Vlissides@ferc.gov.

SUPPLEMENTARY INFORMATION: 
Before Commissioners: Jon Wellinghoff, Chairman; Philip D. Moeller, 
John R. Norris.

Final Rule

Issued May 7, 2012.

    1. Under section 215 of the Federal Power Act (FPA),\1\ the 
Commission approves Reliability Standards PRC-006-1 (Automatic 
Underfrequency Load Shedding) and EOP-003-2 (Load Shedding Plans). In 
addition, pursuant to section 215(d)(5) of the FPA, the Commission 
directs the North American Electric Reliability Corporation (NERC) to 
develop a modification to clarify the intent of one provision of the 
Reliability Standard. The approved Reliability Standards were developed 
and submitted for approval to the Commission by NERC, the Commission 
certified Electric Reliability Organization (ERO) responsible for 
developing and enforcing mandatory Reliability Standards. The approved 
Reliability Standards establish design and documentation requirements 
for automatic underfrequency load shedding (UFLS) programs, which are 
meant to arrest declining frequency and assist recovery of frequency 
following underfrequency events and provide last resort system 
preservation measures.
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    \1\ 16 U.S.C. 824o (2006).
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    2. The Commission approves, with modifications, the related 
Violation Risk Factors (VRFs) and Violation Severity Levels (VSLs), 
implementation plan, and effective date proposed by NERC. The 
Commission approves the retirement of the currently-effective 
Reliability Standards PRC-007-0, PRC-009-0, and EOP-003-1, and the 
NERC-approved Reliability Standard PRC-006-0. Further, the Commission 
approves the regional variance for the Western Electricity Coordinating 
Council (WECC) in PRC-006-1.

I. Background

A. Mandatory Reliability Standards

    3. Section 215 of the FPA requires a Commission-certified ERO to 
develop mandatory and enforceable Reliability Standards, which are 
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.\2\
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    \2\ 16 U.S.C. 824o(e).
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    4. Pursuant to section 215 of the FPA, the Commission established a 
process to select and certify an ERO \3\ and, subsequently, certified 
NERC as the ERO.\4\ On March 16, 2007, the Commission issued Order No. 
693, approving 83 of the 107 Reliability Standards filed by NERC, 
including Reliability Standards PRC-007-0, PRC-009-0, and EOP-003-1.\5\ 
The Commission neither approved nor remanded NERC-approved Reliability 
Standard PRC-006-0 in Order No. 693,\6\ which required regional 
reliability organizations to develop, coordinate, document and assess 
UFLS program design and effectiveness at least every five years. The 
Commission determined neither to approve nor remand this ``fill-in-the-
blank'' Reliability Standard because the regional procedures had not 
been submitted, and the Commission held that it would not propose to 
approve or remand PRC-006-0 until the ERO submitted the additional 
information.\7\
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    \3\ Rules Concerning Certification of the Electric Reliability 
Organization; and Procedures for the Establishment, Approval, and 
Enforcement of Electric Reliability Standards, Order No. 672, FERC 
Stats. & Regs. ] 31,204, order on reh'g, Order No. 672-A, FERC 
Stats. & Regs. ] 31,212 (2006).
    \4\ North American Electric Reliability Corp., 116 FERC ] 
61,062, order on reh'g and compliance, 117 FERC ] 61,126 (2006), 
aff'd sub nom. Alcoa, Inc. v. FERC, 564 F.3d 1342 (D.C. Cir. 2009).
    \5\ Mandatory Reliability Standards for the Bulk-Power System, 
Order No. 693, FERC Stats. & Regs. ] 31,242, at P 603, order on 
reh'g, Order No. 693-A, 120 FERC ] 61,053 (2007).
    \6\ Id. P 1479.
    \7\ Id. PP 1477, 1479.
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B. NERC Petition

    5. On March 31, 2011, NERC filed a petition seeking Commission 
approval of Reliability Standards PRC-006-1 (Automatic Underfrequency 
Load Shedding) and EOP-003-2 (Load Shedding Plans), and the concurrent 
retirement of the currently-effective Reliability Standards PRC-007-0, 
PRC-009-0, and EOP-003-1, and the NERC-approved Reliability Standard 
PRC-006-0. The petition, as amended on May 17, 2011, states that PRC-
006-1 establishes design and document requirements for UFLS programs 
that arrest declining frequency and assist recovery of frequency 
following system events leading to frequency degradation.\8\ The 
petition states that EOP-003-2 makes minimal changes to EOP-003-1 by 
removing references to UFLS, which NERC describes as

[[Page 27575]]

redundant in light of PRC-006-1, and instead focuses EOP-003-2 on 
undervoltage conditions.
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    \8\ The Notice of Proposed Rulemaking in this docket included a 
primer on UFLS programs generally. Automatic Underfrequency Load 
Shedding and Load Shedding Plans Reliability Standards, Notice of 
Proposed Rulemaking, 76 Fed. Reg. 66,220 (October 26, 2011), FERC 
Stats. & Regs. ] 32,682 (2011).
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    6. The petition states that Reliability Standard PRC-006-1 achieves 
a specific reliability goal by establishing design and documentation 
requirements for automatic UFLS programs to arrest declining frequency, 
assist recovery of frequency following underfrequency events, and 
provide last resort system preservation measures. Further, the petition 
states that PRC-006-1 contains a technically sound method to achieve 
its reliability goal by establishing a framework for developing, 
designing, assessing and coordinating UFLS programs, and that PRC-006-1 
is clear and unambiguous regarding what is required and who is required 
to comply with the Reliability Standard.
    7. In the petition, NERC proposes VRFs and VSLs, an implementation 
plan, and an effective date. The petition requests an effective date 
for Reliability Standards PRC-006-1 and EOP-003-2 of one year following 
the first day of the first calendar quarter after applicable regulatory 
approvals with respect to all Requirements of the Reliability Standards 
except Parts 4.1 through 4.6 of Requirement R4 of PRC-006-1. With 
respect to Parts 4.1 through 4.6 of Requirement R4 of PRC-006-1, NERC 
requests an effective date of one year following the receipt of the 
generation data that would be required in draft Reliability Standard 
PRC-024-1 \9\ but no sooner than one year following the first day of 
the first calendar quarter after applicable regulatory approvals of 
PRC-006-1.
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    \9\ Draft Reliability Standard PRC-024-1 addresses ``Generator 
Performance During Frequency and Voltage Excursions'' and is 
currently being developed in the NERC standard drafting process.
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C. Notice of Proposed Rulemaking

    8. On October 20, 2011, the Commission issued a Notice of Proposed 
Rulemaking (NOPR) proposing to approve Reliability Standards PRC-006-1 
and EOP-003-2 as just, reasonable, not unduly discriminatory or 
preferential, and in the public interest. The Commission proposed to 
approve PRC-006-1 and EOP-003-2 because the UFLS program addressed in 
the Reliability Standards is important to arresting declining frequency 
and assisting recovery of frequency following system events that lead 
to system instability, which can result in a blackout. The NOPR stated 
that the Reliability Standards are necessary for reliability because 
UFLS is used in extreme conditions to stabilize the balance between 
generation and load after an electrical island has been formed, 
dropping enough load to allow frequency to stabilize within the island. 
The NOPR concluded that PRC-006-1, in conjunction with the conforming 
changes to EOP-003-2, provides last resort Bulk-Power System 
preservation measures by establishing the first national Reliability 
Standard of common performance characteristics that all UFLS programs 
must meet.
    9. The NOPR proposed to approve the related VRFs and VSLs, 
implementation plan, and effective date proposed by NERC. The NOPR also 
proposed to approve the regional variance for WECC in Reliability 
Standard PRC-006-1.
    10. While proposing to approve Reliability Standards PRC-006-1 and 
EOP-003-2, the NOPR addressed or sought comments on the following 
issues: (A) Impact of resources not connected to the bulk electric 
system; (B) validation of power system models used to simulate UFLS 
programs; (C) scope of UFLS events assessments; (D) impact of generator 
owner trip settings outside of the UFLS program; (E) UFLS program 
coordination with other protection systems; (F) identification of 
island boundaries in UFLS programs; (G) automatic load shedding in PRC-
006-1 and manual load shedding in EOP-003-2; (H) elimination of 
balancing authority responsibilities in EOP-003-2; and (I) the ``Lower 
VSL'' for Requirement R8 and the ``Medium'' VRF for Requirement R5 of 
PRC-006-1.
    11. In response to the NOPR, comments were filed by NERC and 12 
interested persons.\10\ The comments generally support the approval of 
Reliability Standards PRC-006-1 and EOP-003-2. The comments also 
provide information responsive to the questions raised in the NOPR. In 
the discussion below, we address the questions raised in the NOPR in 
light of the comments.
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    \10\ A list of the commenters is provided in the Appendix.
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II. Discussion

    12. The Commission approves Reliability Standards PRC-006-1 and 
EOP-003-2 as just, reasonable, not unduly discriminatory or 
preferential, and in the public interest. The Commission's approval is 
consistent with the broad support for the Reliability Standards 
expressed in the comments. The UFLS program addressed in Reliability 
Standard PRC-006-1 is important to arresting declining frequency and 
assisting recovery of frequency following system events that lead to 
system instability, which can result in a blackout. Accordingly, the 
Reliability Standard is necessary for reliability because UFLS is used 
in extreme conditions to stabilize the balance between generation and 
load after an electrical island has been formed, dropping enough load 
to allow frequency to stabilize within the island. PRC-006-1, in 
conjunction with the conforming changes to EOP-003-2, provides last 
resort Bulk-Power System preservation measures by establishing the 
first national Reliability Standard of common performance 
characteristics that all UFLS programs must meet. For the same reasons, 
we approve the regional variance for WECC in PRC-006-1. We also approve 
the VRFs and VSLs designated for the requirements of the Reliability 
Standards, with modifications, and the implementation plan and 
effective date, as proposed by NERC.
    13. We address below the following issues raised in the NOPR in 
light of the comments received: (A) Impact of resources not connected 
to the bulk electric system; (B) validation of power system models used 
to simulate UFLS programs; (C) scope of UFLS events assessments; (D) 
impact of generator owner trip settings outside of the UFLS program; 
(E) UFLS program coordination with other protection systems; (F) 
identification of island boundaries in UFLS programs; (G) automatic 
load shedding in PRC-006-1 and manual load shedding in EOP-003-2; (H) 
elimination of balancing authority responsibilities in EOP-003-2; and 
(I) the ``Lower VSL'' for Requirement R8 and the ``Medium'' VRF for 
Requirement R5 of PRC-006-1. Regarding the last issue, the Commission 
directs NERC to modify the ``Lower VSL'' for Requirement R8 of PRC-0061 
and the ``Medium'' VRF for Requirement R5 of PRC-006-1 consistent with 
the discussion below.

A. Impact of Resources Not Connected to Bulk Electric System Facilities

    14. Requirement R2 of Reliability Standard PRC-006-1 requires 
planning coordinators to identify islands to serve as a basis for 
designing UFLS programs. Requirement R3 addresses performance 
characteristics for UFLS programs. Requirement R4 requires each 
planning coordinator to conduct and document the assessment of its UFLS 
design and determine if the UFLS program meets the performance 
characteristics in Requirement R3 for each island identified in 
Requirement R2. The simulations outlined in Requirement R4 all concern 
individual generating units greater than 20 MVA gross nameplate rating 
or generating plants/facilities greater then 75 MVA ``connected to the 
bulk electric system.''

[[Page 27576]]

    15. In the NOPR, the Commission stated that some generation meeting 
the 20 MVA and 75 MVA criteria in Reliability Standard PRC-006-1, 
Requirement R4 would not be modeled pursuant to Requirement R4 because 
it is not connected to bulk electric system facilities. The Commission 
explained that a resource not directly connected to the bulk electric 
system may serve load designed to be shed in a UFLS program. The 
Commission expressed concern that failure to account for resources not 
directly connected to the bulk electric system could result in planning 
coordinators being unaware of how those resources respond to 
underfrequency conditions. The Commission stated that if a planning 
coordinator is unaware of how these resources respond, it may plan to 
shed more load than is necessary for an area's frequency to return to 
normal, which could cause an unintended overfrequency condition if the 
plan is carried out in the operating timeframe. These conditions, in 
turn, could cause the UFLS program to violate the performance 
characteristics specified in Requirement R3 of PRC-006-1. The 
Commission sought comment as to whether and how all resources required 
for the reliable operation of the bulk electric system, including 
resources not connected to bulk electric system facilities, are 
considered in the development of UFLS programs under Requirements R3 
and R4 of PRC-006-1.
Comments
    16. NERC agrees with the NOPR that failing to model qualifying 
generation not directly connected to the bulk electric system could 
affect the simulated frequency response. NERC, however, clarifies that 
Reliability Standard PRC-006-1 does not ``establish parameters for what 
resources are modeled in [] simulations'' and that ``power system 
models used in UFLS assessments are generally the same models used in 
transmission planning assessments, which include models of all 
generation units and plants that meet the threshold size requirements 
even those not connected directly to the Bulk Electric System.'' \11\ 
In addition, NERC states that a standard authorization request is under 
development as part of the ``second phase'' of the project to revise 
the definition of bulk electric system, and information developed as 
part of that project could be used to assess whether any changes are 
needed to PRC-006-1.
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    \11\ NERC Comments at 4.
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    17. EEI, TAPS, MISO, and FRCC maintain that the vast majority of 
qualifying generation is accounted for in Reliability Standard PRC-006-
1. EEI comments that bulk electric system resources account for the 
``vast majority of resources within all interconnections'' and supports 
the standard drafting team's belief that the Reliability Standard 
generally captures about 95 percent of utility-owned installed 
capacity.\12\ While EEI acknowledges that there are a small number of 
unaccounted for generation resources that meet the qualifying criteria, 
EEI comments that what is captured is sufficient for assessing reliable 
operation of the bulk electric system. EEI also maintains that planning 
coordinators already consider other resources as appropriate.
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    \12\ EEI Comments at 2-3.
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    18. TAPS states that the ``great majority'' of generators are not 
set to trip before the underfrequency set points, so they will be 
available for UFLS programs.\13\ TAPS contends that the only generators 
of concern are those that: (1) Do not meet Reliability Standard PRC-
006-1's size and connection criteria; (2) trip prior to underfrequency 
set points; and (3) are dispatched during underfrequency events because 
they are not required to be modeled under PRC-006-1. TAPS maintains 
that the number of generators that meet these criteria is ``very 
small'' so that modeling them would have an ``infinitesimal reliability 
benefit,'' not improving the overall accuracy of the UFLS program 
design and not justifying the additional costs.\14\
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    \13\ TAPS Comments at 4.
    \14\ Id. at 4-5.
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    19. MISO states that UFLS simulations should not be required to 
include all generation that meets the 20 MVA and 75 MVA criteria in 
Reliability Standard PRC-006-1, Requirement R4. MISO cites the standard 
drafting team's belief that PRC-006-1 captures about 95 percent of 
utility-owned installed capacity.\15\ MISO also maintains that the 
standard drafting team deserves deference and that simulations will 
always contain some degree of uncertainty.
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    \15\ MISO Comments at 3.
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    20. FRCC states that generators that fall within the size 
requirements of Reliability Standard PRC-006-1 but that are not 
connected to bulk electric system facilities constitute a ``very small 
amount.'' \16\ FRCC maintains that this amount is well below the error 
tolerance of a well-designed UFLS program and, thus, is not important.
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    \16\ FRCC Comments at 2.
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    21. SWPA states that planning coordinators, in developing UFLS 
programs, should consider all resources that are determined to be 
required for the reliable operation of the bulk electric system, 
regardless of whether those resources are directly connected to the 
bulk electric system.
    22. NYISO comments that it analyzes UFLS effectiveness using a 
Multiregional Modeling Working Group dynamics model of the Eastern 
Interconnection, which includes all resources on the system regardless 
of bulk electric system connections.
Commission Determination
    23. In the NOPR, the Commission expressed concern regarding the 
development of UFLS programs that fail to account for qualifying 
generation not directly connected to the bulk electric system. We are 
satisfied with the explanations provided by commenters. First, we are 
persuaded by NERC's explanation that Reliability Standard PRC-006-1 
does not limit the resources that can be modeled in the UFLS 
assessments and that power system models used in UFLS assessments 
generally model all qualifying generation, including resources not 
directly connected to the bulk electric system. In summary, although 
PRC-006-1 does not require all of the generation that is not directly 
connected to the bulk electric system to be included in the modeling, 
the subset of these resources that are required to assure that the UFLS 
models are sufficient to accurately predict system performance will be 
included. Similarly, we accept comments from EEI, TAPS, MISO, and FRCC 
that PRC-006-1 requires modeling of the vast majority of qualifying 
generation to ensure the reliable operation of the bulk electric 
system.
    24. Like SWPA, the Commission believes that requiring all 
qualifying assets to be accounted for in UFLS programs, regardless of 
whether they are directly or indirectly connected to the bulk electric 
system, is useful to ensuring the effectiveness of the programs. Not 
requiring applicable entities to model sufficient amounts of qualifying 
generation indirectly connected to the bulk electric system could 
result in applicable entities not knowing how those resources react 
during underfrequency situations, which could cause excessive load 
shedding in an emergency and further contribute to system instability.
    25. NERC states in its comments that this issue could be further 
evaluated in the ``second phase'' of the project to revise the 
definition of bulk electric system, and that information from that 
project could be used as a basis for

[[Page 27577]]

revising Reliability Standard PRC-006-1 if necessary.\17\ Without 
prejudging those efforts, the Commission will not issue a directive 
requiring the modeling of qualifying generation not directly connected 
to the bulk electric system.
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    \17\ NERC Comments at 5.
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B. Validation of Power System Models

    26. In the NOPR, the Commission stated that dynamic simulations 
that fail to accurately represent the power system can result in UFLS 
programs that are ineffective. The Commission, however, concluded that 
the UFLS program design requirements established in Requirement R2 of 
Reliability Standard PRC-006-1 and the required assessments established 
in Requirements R4 and R11 of PRC-006-1 are generally acceptable and 
include improvements over the current Reliability Standards.
Comments
    27. FRCC comments that improving the accuracy of power system 
models used in simulating system response to forecasted system 
conditions is an appropriate goal, but achieving 100 percent accuracy 
is not practicable. EEI comments that dynamic simulations for any large 
power system will never be 100 percent accurate and asks the Commission 
not to impose any new directives which might unnecessarily increase 
costs to industry.
    28. NYISO states that a lack of accuracy in modeling can have a 
significant impact on analyses of under-generated islands. 
Specifically, NYISO states that ``optimistic models of unit governing 
response can lead to invalid conclusions regarding minimum frequency 
and frequency recovery.'' \18\ NYISO indicates that it is taking steps 
to improve the accuracy of modeling frequency recovery by, among other 
things, aligning the dynamics model to observed system response.
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    \18\ NYISO Comments at 3.
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Commission Determination
    29. The Commission accepts the comments from EEI and FRCC that 
power system models with 100 percent accuracy are not practicable. The 
Commission, however, is mindful of the consequences of inaccurate power 
system models and their impact on an entity's ability to accurately 
simulate system performance. As noted by NYISO, inaccurate models can 
lead to invalid conclusions which can be detrimental to the analysis 
and operation of the bulk electric system. At a minimum, the models 
should accurately predict system performance during UFLS events. 
Although entities may take additional steps, such as the step taken by 
NYISO to ensure accurate models, as stated in the NOPR, the Commission 
believes that the design requirements in Reliability Standard PRC-006-1 
are acceptable.\19\
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    \19\ NOPR, FERC Stats & Regs, ] 32,682 at P 34.
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C. UFLS Event Assessments

1. Assessments in the Absence of Island Formation
    30. Requirement R11 of Reliability Standard PRC-006-1 requires 
planning coordinators to conduct assessments after a ``BES islanding 
event results in system frequency excursion below the initializing set 
points of the UFLS program.''
    31. In the NOPR, the Commission expressed concern that the phrase 
``BES islanding event'' could be interpreted to mean that a planning 
coordinator only has to assess an event if it meets both of the 
following requirements: (1) System frequency excursions fall below the 
initializing set point for UFLS; and (2) bulk electric system islands 
form within the Interconnection. The Commission explained that, if 
frequency falls below the initializing UFLS set point but islands do 
not form (e.g., because the event was not severe enough to isolate 
portions of the Interconnection, or UFLS or other protection systems 
failed to operate properly to form islands), an assessment of the 
performance of the UFLS program for this event is still useful because 
it can determine if the UFLS program operated as expected. The 
Commission sought comment on what actions must planning coordinators 
take under Requirement R11 of PRC-006-1 if an event results in system 
frequency excursions falling below this initializing set point for UFLS 
but without the formation of a bulk electric system island.
Comments
    32. In its comments, NERC states that ``[a]lthough PRC-006-1 does 
not prescribe an analysis for [the non-islanding scenario identified in 
the NOPR], activating UFLS during an Interconnection-wide event would 
involve a significant loss of generation and analysis would be 
performed under the NERC Event Analysis program or the NERC Rules of 
Procedure, depending on the severity of the event.'' \20\ NERC further 
states that the ``activation of UFLS, while highly unlikely, would be a 
significant event requiring assessment of several aspects of system 
frequency, including system Frequency Response, equipment performance, 
and coordination of protection and control systems, in addition to the 
assessment of UFLS program operation.'' \21\ Ultimately, NERC agrees 
that an assessment of the performance of UFLS, even in the absence of 
island formation, is useful.
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    \20\ NERC Comments at 6.
    \21\ Id.
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    33. EEI and MISO agree with NERC that Requirement R11 of 
Reliability Standard PRC-006-1 requires both conditions (i.e., 
frequency excursion and islanding) to be met. MISO agrees with the NOPR 
that an analysis of excursions without islanding is useful. However, 
MISO and EEI comment that such an analysis is outside the scope of the 
Reliability Standard. MISO, quoting the NOPR, states that UFLS ``is 
designed for use in extreme conditions to stabilize the balance between 
generation and load after an electrical island has been formed.'' \22\ 
Accordingly, MISO argues that a UFLS program ``can only truly be 
assessed in light of its performance after an island has formed.'' \23\ 
In addition, such assessments are costly, time consuming and resource 
intensive, according to MISO. EEI maintains that entities ``broadly 
perform assessments of lesser events as they deem necessary.'' \24\ EEI 
contends that such assessments are not required in PRC-006-1 because 
``to do so would go beyond the intent of the program which is the 
design of UFLS programs.'' \25\ Instead, EEI notes that applicable 
entities normally conduct operational assessments regularly, and if an 
entity identifies a problem the entity would report the matter as a 
misoperation with an obligation to remediate. EEI also points to the 
draft NERC Event Analysis Process \26\ and its application to what EEI 
describes as ``underfrequency events of a lesser level'' (i.e., events 
resulting in load shedding with a loss of load of 100 MW or more).\27\ 
EEI contends that the Commission's concerns regarding analysis of 
lesser events will be satisfied once the NERC Event Analysis Process is 
finalized.
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    \22\ MISO Comments at 4 (citing NOPR, FERC Stats & Regs. 32,682 
at P 35).
    \23\ Id.
    \24\ EEI Comments at 5.
    \25\  Id.
    \26\ We understand the NERC Event Analysis Process to be the 
same as the NERC Event Analysis program referenced in NERC's 
comments.
    \27\ Id.
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    34. SWPA states that it is reasonable for planning coordinators to 
request and analyze event data in the absence of island formation to 
assess the performance of UFLS programs. Specifically, SWPA comments 
that

[[Page 27578]]

``[t]he assessment of a UFLS event during varying system conditions 
caused by generator outages, transmission outages, and various 
maintenance activities, provides an opportunity to discover the impacts 
of these activities on the expected outcomes described in the plan.'' 
\28\
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    \28\ SWPA Comments at 3.
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Commission Determination
    35. NERC clarifies that Requirements R11 and R12 of Reliability 
Standard PRC-006-1 are triggered when system frequency excursions fall 
below the initializing set points for UFLS programs and bulk electric 
system islands form within Interconnections.\29\
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    \29\ NERC Comments at 6.
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    36. The Commission agrees with commenters that it would be useful 
to have an analysis of system frequency excursions to assess the 
performance of UFLS programs even in the absence of island 
formation.\30\ To that end, we agree with NERC that underfrequency 
events that result in the initializing of the UFLS set point, even in 
the absence of island formation, would be analyzed under provisions 
contained in the NERC Rules of Procedure and the NERC Event Analysis 
program.\31\
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    \30\ NERC Comments at 5; MISO Comments at 4; SWPA Comments at 3.
    \31\ NERC Comments at 6. Section 807 of the NERC Rules of 
Procedure addresses ``Analysis of Major Events'' and Section 808 
addresses ``Analysis of Off-Normal Events, Potential System 
Vulnerabilities, and System Performance.'' Separately, the NERC 
Event Analysis program, which is not incorporated in the NERC Rules 
of Procedure, as of this time is still under development. Compliance 
with the NERC Rules of Procedure is mandatory pursuant to section 
39.2(b) of the Commission's regulations and is enforceable by the 
Commission pursuant to section 39.9 of the Commission's regulations. 
18 CFR 39.2(b) (``All entities subject to the Commission's 
reliability jurisdiction under paragraph (a) of this section shall 
comply with applicable Reliability Standards, the Commission's 
regulations, and applicable Electric Reliability Organization and 
Regional Entity Rules made effective under this part.''); 18 CFR 
39.9.
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2. Coordination of Assessments and Results
    37. Requirements R5 and R13 of Reliability Standard PRC-006-1 
provide flexibility in coordinating UFLS design programs and event 
assessments among planning coordinators whose areas fall within the 
same island or whose areas are affected by the same event. In the NOPR, 
the Commission sought comments on whether differences in assessments 
between planning coordinators should be reported to reliability 
coordinators for resolution in the event that the process identified in 
PRC-006-1 does not resolve the differences.
Comments
    38. NERC, MISO, and EEI comment that reliability coordinators 
should not be tasked with resolving differences between planning 
coordinator event assessments. NERC states that differences between 
planning coordinator event assessments should not be reported to 
reliability coordinators because: (1) Reliability coordinator's wide-
area view may not coincide with island boundaries; (2) reliability 
coordinators may have conflicts of interest; (3) reliability 
coordinators may not have the tools to resolve the differences; and (4) 
reliability coordinators work in a real-time operating environment, 
which makes them ill-suited to resolve disputes among planning 
coordinators.
    39. MISO and EEI comment that event assessment differences should 
not be reported to reliability coordinators because planning 
coordinators are better positioned to reconcile differences. MISO notes 
that in some cases where an applicable entity is both a reliability 
coordinator and planning coordinator (as is the case with MISO), there 
would be a conflict of interest. Further, MISO maintains that referring 
disputes to reliability coordinators imposes additional costs with 
little to no benefit. MISO and EEI also contend that event assessment 
differences do not pose a risk to the reliability of the bulk electric 
system, with EEI noting that such differences are ``a result of 
legitimate engineering and regional practices and processes.'' \32\ At 
most, EEI suggests that reliability coordinators might be used as 
informal facilitators.
---------------------------------------------------------------------------

    \32\ EEI Comments at 6.
---------------------------------------------------------------------------

    40. SWPA states that a clear resolution process is necessary and 
that referring disputes to reliability coordinators is a reasonable 
consideration.
Commission Determination
    41. The Commission is persuaded by the comments of NERC, MISO, and 
EEI that differences between planning coordinator event assessments 
should not be referred to reliability coordinators for resolution. We 
share the concern of NERC, MISO, and EEI that referring disputes to 
reliability coordinators may create conflicts of interest because a 
planning coordinator may also serve as a reliability coordinator. We 
agree, however, with SWPA that disputes between planning coordinator 
event assessments should be resolved. Therefore, the Commission expects 
planning coordinators to work in good faith including, as appropriate, 
use of third parties to resolve disputes concerning event assessments. 
If the Commission finds that these disputes are not being resolved, the 
Commission may consider adoption of an appropriate process to ensure 
resolution of the disputes.
3. Assessment Timeline for Completion
    42. Requirement R11 of Reliability Standard PRC-006-1 requires 
planning coordinators to perform island event assessments within one 
year of an event. If the planning coordinator identifies program 
deficiencies, Requirement R12 of PRC-006-1 requires planning 
coordinators to conduct and document UFLS design assessments, which are 
meant to consider the deficiencies, within two years of an event.
    43. In the NOPR, the Commission expressed concern that this time 
frame could be too long because island event assessments and 
consideration of deficiencies could reasonably be done in a shorter 
time frame. Moreover, the Commission noted that under PRC-006-1, 
deficiencies could remain within a UFLS program for two years from an 
event exposing the Bulk-Power System to instability, uncontrolled 
separation and cascading outages should a frequency event occur that 
the UFLS program mishandles. The Commission sought comments on the 
basis for the two-year time frame and clarification as to how soon 
after an event would an entity need to implement corrections in 
response to any deficiencies identified in the event assessment under 
Requirement R11 of PRC-006-1.
Comments
    44. NERC comments that, while some events can be assessed in less 
time, one year is a realistic time-frame to assess performance for 
complex events and two years is a realistic time-frame to address 
identified deficiencies. NERC states that ``the amount of time that a 
UFLS entity has to implement corrections will be established by the 
Planning Coordinator, as specified in Requirement R9 of PRC-006-1 * * * 
[and] [t]he time allotted for corrections will depend on the extent of 
the deficiencies identified.'' \33\
---------------------------------------------------------------------------

    \33\ NERC Comments at 8.
---------------------------------------------------------------------------

    45. EEI, MISO, and G&T Cooperatives support the timelines in 
Reliability Standard PRC-006-1. MISO maintains that event assessments 
are time and resource intensive and must not be rushed. EEI, MISO, and 
G&T Cooperatives state that planning coordinators can complete analyses 
of less complex events before the two-year deadline, but they need the 
maximum

[[Page 27579]]

allowable time to finish analyses of complex events. With respect to 
the time allowed for correcting problems, EEI comments that any 
deadline in a requirement would be difficult to enforce and would not 
improve reliability given the variable nature of possible deficiencies.
    46. SWPA states that an applicable entity may need to implement 
corrections that require complex procurement or acquisition processes, 
and such contracts can be complex, involving many required decisions 
and actions. Given these complexities, SWPA maintains that four years 
after event actuation is a reasonable deadline to implement 
corrections.
Commission Determination
    47. Based on the comments, the Commission is persuaded that two 
years to complete design assessments pursuant to Reliability Standard 
PRC-006-1 is appropriate. As noted by EEI, MISO, and G&T Cooperatives, 
assessments of complex events can be time and resource intensive. Thus, 
we agree that two years is a reasonable maximum allowable time for 
completion of design assessments. However, we agree with commenters 
that efforts should be made to complete assessments of less complex 
events before the two-year maximum allowable period.\34\
---------------------------------------------------------------------------

    \34\ EEI Comments at 7; MISO Comments at 6.
---------------------------------------------------------------------------

    48. In response to the Commission's concern that Reliability 
Standard PRC-006-1 does not specify how soon after an event would an 
entity need to implement corrections in response to any deficiencies 
identified in the event assessment under Requirement R11 of PRC-006-1, 
NERC stated in its comments that:

    The amount of time that a UFLS entity has to implement 
corrections will be established by the Planning Coordinator, as 
specified in Requirement R9 of PRC-006-1. The time allotted for 
corrections will depend on the extent of the deficiencies 
identified. The schedule specified by the Planning Coordinator will 
consider the time necessary for budget planning and implementation, 
recognizing that operating and maintenance budgets normally will not 
be sufficient to address major revisions and allowances will be 
necessary for inclusion of approved changes in budgeting cycles.\35\
---------------------------------------------------------------------------

    \35\ NERC Comments at 8.

---------------------------------------------------------------------------
    Requirement R9 of PRC-006-1 states:

    R9. Each UFLS entity shall provide automatic tripping of Load in 
accordance with the UFLS program design and schedule for application 
determined by its Planning Coordinator(s) in each Planning 
Coordinator area in which it owns assets. [VRF:High][Time Horizon: 
Long-term Planning]

    Notwithstanding NERC's comments, the Commission is not persuaded 
that Requirement R9 requires corrective action in accordance with a 
schedule established by the planning coordinator. Based on its 
comments, however, NERC has expressed no opposition to such a 
requirement. We accept NERC's comments that Requirement R9 requires a 
schedule established by the planning coordinator, but NERC's reading of 
Requirement R9 should be made clear in the Requirement itself. 
Accordingly, we direct NERC to make that requirement explicit in future 
versions of the Reliability Standard. Within 30 days of the effective 
date of this Final Rule, NERC is directed to submit a compliance filing 
indicating how it plans to comply with this directive and a deadline 
for compliance.

D. Generator Owner Trip Settings Outside of the UFLS Program

    49. In the NOPR, the Commission stated that Requirements 4.1 
through 4.7 of Reliability Standard PRC-006-1 are intended to capture 
the effects of generators that trip prior to UFLS initiation. While 
agreeing that planning coordinators should consider generators that 
trip prior to underfrequency set points when developing their UFLS 
programs, the Commission sought comments on how generation losses 
outside of the UFLS set points (i.e., generators having trip settings 
prior to the UFLS underfrequency set points) should be accounted for in 
UFLS programs (e.g., generator owners who trip outside of the UFLS set 
points could procure load to shed to account for the loss in 
generation).
Comments
    50. NERC, EEI, TAPS, Dominion, FRCC and EPSA oppose requiring 
generator owners to procure load to shed for generators that trip 
outside of the UFLS set points. NERC states that it is appropriate for 
planning coordinators to consider generators that trip outside of the 
UFLS set points when designing UFLS programs, but it is inappropriate 
for planning coordinators to determine whether mitigation is necessary 
and who will be responsible for providing mitigation.
    51. EEI states that Reliability Standard PRC-006-1, Requirement R4 
requires that all resources included in the UFLS program that operate 
outside the specified trip settings be factored in to the dynamic 
simulation models used to develop the program. EEI further notes that, 
while there is no formal obligation for generator owners to supply trip 
setting data to planning coordinators, this information is shared. 
Unlike modeling generators that trip outside of the UFLS set points, 
EEI maintains that the issue of procuring load to shed to compensate 
for such trips is outside the scope of PRC-006-1.
    52. TAPS comments that generators that trip prior to underfrequency 
set points are separately modeled under Reliability Standard PRC-006-1 
and that this is the correct approach to account for such generators. 
TAPS opposes requiring generator owners who trip outside of the UFLS 
set points to procure load to shed to account for the loss in 
generation. TAPS objects to a ``one-size-fits all market/contractual 
solution'' given the absence of a demonstrable reliability problem and 
the market power concerns it might create.\36\ TAPS maintains that in 
some small islands it may be impossible to procure the necessary load 
to shed.
---------------------------------------------------------------------------

    \36\ TAPS Comments at 7.
---------------------------------------------------------------------------

    53. Dominion states that generator owners whose generators trip 
prior to UFLS set points should not be required to procure load to 
shed. Dominion contends that such a scheme could be extremely difficult 
to design and coordinate, and Dominion is unaware of any distribution 
provider or transmission owner tariff that offers such a service.
    54. FRCC maintains that a small minority of generator 
underfrequency protection settings are above the minimum UFLS frequency 
set points and that in many cases any conflicts can be resolved by 
reexamination of the technical basis for the generator's underfrequency 
protection. FRCC also states that requiring generator operators to 
procure load to shed would be technically impossible, and there is no 
market for compensatory, assignable UFLS to make generator contracts 
for load shedding feasible.
    55. EPSA states that planning coordinators should consider 
generators that trip prior to underfrequency set points when collecting 
information and developing their UFLS programs. EPSA maintains, 
however, that requiring planning coordinators to account for generators 
that trip prior to the UFLS set points presupposes that there is a 
material amount of generator losses occurring. EPSA believes that 
implementation of Reliability Standard PRC-006-1 will allow planning 
coordinators to gather information to determine the amount of losses, 
which can then be used to decide whether generator losses need to be 
accounted for. EPSA states that if generator losses are found to be a 
material concern that

[[Page 27580]]

needs to be accounted for, the Commission should consider that: (1) 
Generator owners do not and cannot play an active role in UFLS program 
decisions; (2) generator owners do not determine the set points for 
their generation; and (3) the NERC process should not be used to 
influence market decisions and competitiveness.
    56. SWPA states that the design assessment in Requirement R4 of 
Reliability Standard PRC-006-1 addresses the modeling of generators 
having trip settings prior to the UFLS set points but that the 
Reliability Standard does not address how planning coordinators would 
resolve the need for supplemental UFLS. SWPA maintains that PRC-006-1 
should include a requirement for planning coordinators to identify the 
UFLS entity that needs to provide supplemental UFLS, the basis for the 
identification, and coordination of this information with those 
entities and affected generator owners.
    57. NYISO states that it conducts an annual survey of all generator 
owners within the New York Control Area for their UFLS trip setting and 
addresses those that have settings outside the UFLS program range 
established by the Northeast Power Coordinating Council (NPCC). NYISO 
states that it conducts a UFLS simulation that excludes non-conforming 
generation and a separate simulation that incorporates 260 MW of 
compensatory load shedding with tripping of non-conforming generation.
Commission Determination
    58. Based on the comments, the Commission is persuaded to take no 
action to require compensation for generation losses outside of the 
UFLS set points (i.e., generators having trip settings prior to the 
UFLS underfrequency set points). Reliability Standard PRC-006-1 is an 
improvement because it requires planning coordinators to consider 
generators that trip outside of the UFLS set points when modeling and 
designing UFLS programs. We are persuaded by NERC's comments that it is 
appropriate for planning coordinators to consider generators that trip 
outside of the UFLS set points when designing UFLS programs, but it is 
inappropriate for planning coordinators to determine whether mitigation 
is necessary and who will be responsible for providing mitigation. For 
these reasons, we take no action to modify the Reliability Standard.

E. UFLS Program Coordination With Other Protection Systems

    59. In the NOPR, the Commission stated that an integrated approach 
to the coordination of all types of protection systems (e.g., UFLS, 
undervoltage load shedding \37\), internally and externally to an 
entity's area, is required to be responsive to the 2003 Blackout 
Report.\38\ The Commission noted that, while Reliability Standard PRC-
006-1 requires coordination of UFLS programs among planning 
coordinators in Requirements R5, R7, and R13, it does not appear to 
capture the same level of coordination with other protection systems as 
in Requirement R1.2.8 of PRC-006-0, which was approved by the NERC 
Board of Trustees but left pending in Order No. 693.\39\ The Commission 
sought comments on whether and how coordination with other protection 
systems is or is not achieved under the new requirements.
---------------------------------------------------------------------------

    \37\ Undervoltage load shedding (UVLS) is automatic load-
shedding that sheds load to prevent local area voltage collapse. See 
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 92 (Apr. 2004) (Blackout Report), available at 
http://www.ferc.gov/industries/electric/indus-act/reliability/blackout.asp.
    \38\ Blackout Report at 159.
    \39\ Order No. 693, FERC Stats. & Regs. ] 31,242 at PP 1477, 
1479.
---------------------------------------------------------------------------

Comments
    60. NERC states that Requirement R1.2.8 of PRC-006-0 includes a 
broad mandate and that the intent was to replace it with more specific 
requirements that are clear and measurable. NERC contends that 
Requirements R3, R4, and R10 of Reliability Standard PRC-006-1 include 
requirements for the coordination of UFLS programs with specific 
protections that ``are part of or could impact the UFLS program.'' \40\ 
EEI and G&T Cooperatives likewise believe that Requirement R1.2.8 is 
vague, while PRC-006-1 contains the specificity to ensure that UFLS 
programs are adequately designed and coordinated. G&T Cooperatives 
maintains that coordination of UFLS and UVLS programs is already 
provided for in PRC-010-0, Requirement R1.1.1.
---------------------------------------------------------------------------

    \40\ NERC Comments at 9.
---------------------------------------------------------------------------

    61. FRCC states that there is seldom a need to coordinate UFLS with 
UVLS and that the Reliability Standard PRC-006-1 correctly identifies 
the protection systems that entities should coordinate with UFLS 
programs. FRCC contends that the potential for interaction between UFLS 
and UVLS programs is minimal given that UVLS schemes are not deployed 
throughout an interconnection and are, instead, deployed in specific 
locations that may be exposed to low voltage for a specific 
contingency. NYISO likewise states that, due to the distributed nature 
of UFLS, there should not be any significant interaction between fault 
clearing protections and UFLS and that under-voltage inhibition of 
relays is not expected to interfere with UFLS programs.
Commission Determination
    62. With regard to our concern raised in the NOPR regarding the 
coordination of UFLS with other protection systems, we are persuaded by 
NERC's comments that Reliability Standard PRC-006-1 provides an 
adequate level of coordination between the UFLS program and specific 
protection systems and controls that NERC identifies as part of, or 
could impact, the UFLS program.\41\
---------------------------------------------------------------------------

    \41\ It may be appropriate to address an integrated approach to 
the coordination of all protections systems, as recommended by the 
Blackout Report, but that issue is outside the scope of this 
proceeding addressing Reliability Standard PRC-006-1.
---------------------------------------------------------------------------

    63. We are persuaded by NERC comments that ``Requirements R3, R4, 
and R10 of PRC-006-1 address coordination of the UFLS program with 
other protection and control systems * * * includ[ing] generator 
protections that could respond to frequency and voltage excursions, 
automatic Load restoration, and equipment switching that may be 
included in the UFLS program to control voltage.'' \42\ Specifically, 
planning coordinators are to coordinate expected generation performance 
during underfrequency events and generator trip settings under PRC-006-
1, Requirements R3 and R4.\43\ To satisfy PRC-006-1, Requirement R10, 
transmission owners must provide the necessary automatic switching of 
elements as directed by the planning coordinator in the UFLS program 
and schedule.\44\ To maintain the required system restoration 
capability required by PRC-006-1, Requirement R10, transmission owners 
must coordinate other protection system components with the established 
UFLS program components.
---------------------------------------------------------------------------

    \42\ NERC Comments at 9.
    \43\  Id. at 9-10.
    \44\  Id. at 11.
---------------------------------------------------------------------------

    64. Additionally, the Commission notes that currently-effective 
Reliability Standard PRC-001-1 (System Protection Coordination) ensures 
system protection coordination for protection systems.\45\ The 
Commission believes that this level

[[Page 27581]]

of coordination between UFLS programs and other specific protection 
systems is adequate.
---------------------------------------------------------------------------

    \45\ Reliability Standard PRC-001-1, Requirements R1 and R3.
---------------------------------------------------------------------------

F. Identification of Island Boundaries

    65. Requirement R1 of Reliability Standard PRC-006-1 directs 
planning coordinators to develop criteria to select areas that may form 
islands based on historical events and system studies. Historical 
events and system studies provide planning coordinators with the data 
necessary to determine where islands will occur based on the physics of 
the system. Requirement R2.3 of PRC-006-1 allows planning coordinators 
to ``adjust the island boundaries to differ from the Regional Entity 
area boundaries by mutual consent where necessary'' to preserve 
contiguous island boundaries that better reflect simulations.
    66. In the NOPR, the Commission agreed with the premise behind 
Requirement R1, which requires identifying island boundaries based on 
where they are likely to occur as opposed to following rigid Regional 
Entity area boundaries, because it should result in more effective UFLS 
programs. The NOPR also noted that NERC, in its petition, stated that 
Reliability Standard PRC-006-1 allows planning coordinators to ``select 
islands including interconnected portions of the bulk electric system 
in adjacent Planning Coordinator areas and Regional Entity areas, 
without the need for coordinating this selection with Planning 
Coordinators in neighboring regions.'' \46\ The Commission observed, 
however, that Requirement R2.3 of PRC-006-1 requires ``mutual consent'' 
to adjust island boundaries from Regional Entity boundaries. The 
Commission sought clarification concerning the required degree of 
cooperation and/or ``mutual consent'' between planning coordinators 
under the proposed Reliability Standard.
---------------------------------------------------------------------------

    \46\ NERC Petition at 75-76.
---------------------------------------------------------------------------

Comments
    67. In its comments, NERC clarifies that ``mutual consent'' is 
required by part 2.3 of Requirement R2 of Reliability Standard PRC-006-
1 when planning coordinators select island boundaries that do not 
coincide with the Regional Entity area or Interconnection boundary. 
NERC explains that, when a planning coordinator selects an island 
boundary that does not coincide with the Regional Entity area or 
Interconnection boundary, mutual consent must be obtained from 
neighboring planning coordinators to ensure that the deviation does not 
result in a portion of the bulk electric system being excluded from a 
UFLS assessment.
    68. EEI states that the Reliability Standard PRC-006-1 requires 
``mutual consent'' between affected planning coordinators and that the 
level of consent is voluntary and undefined to allow the parties to 
determine the level of cooperation necessary. EEI maintains that this 
scheme is necessary to ensure that all parts of the bulk electric 
system are covered within a UFLS plan.
    69. MISO states that planning coordinators should be able to study 
islands as they see fit and without the consent of neighboring planning 
coordinators, which includes studying islands that deviate from 
Regional Entity boundaries. MISO maintains that there is no detrimental 
effect associated with multiple or non-coordinated island studies.
    70. NYISO comments that it regularly conducts stability evaluations 
on a New York Control Area and regional basis and is aware of the 
potential breakpoints on the system.
    71. EPSA states that UFLS programs are best developed on an 
interconnection-wide basis, not on a regional basis. EPSA notes that 
region-specific Reliability Standards could undermine Reliability 
Standards PRC-006-1 and EOP-003-2 if they do not address interregional 
coordination among planning coordinators.
    72. PSEG states that it has concerns with the active draft regional 
versions of PRC-006-1 pertaining to ReliabilityFirst Corporation and 
NPCC. PSEG maintains that these regional versions will hamper needed 
interregional coordination for UFLS program design in the Eastern 
Interconnection (i.e., the proposed regional standards do not require 
interregional coordination among planning coordinators and may require 
planning coordinators who span multiple regions to follow different 
standards); they violate a key NERC market principle by requiring 
existing generator owners to procure offsetting UFLS for the early 
tripping of their generating units if these units cannot meet specific 
performance requirements; and they may contravene the Energy Policy Act 
of 2005 \47\ by placing NERC and the regions in the role of imposing 
generation adequacy requirements. PSEG maintains that UFLS is an 
interconnection-wide issue and should be addressed on an 
interconnection-wide basis.
---------------------------------------------------------------------------

    \47\ Energy Policy Act of 2005, Public Law 109-58, 119 Stat. 594 
(2005).
---------------------------------------------------------------------------

Commission Determination
    73. The Commission accepts NERC's clarification of the level of 
consent required between planning coordinators to adjust island 
boundaries under Reliability Standard PRC-006-1, Requirement R2.3. As 
stated in the NOPR, we believe that the reliability of the bulk 
electric system benefits from entities basing their studies on physical 
characteristics, as allowed in PRC-006-1, as opposed to hewing to 
artificial boundaries.\48\ To the extent MISO suggests in its comments 
that planning coordinators should not have to reach a consensus with 
neighboring planning authorities when adjusting island boundaries, we 
disagree. As NERC and EEI explain in their comments, it is important to 
coordinate adjustments in island boundaries to ensure that no part of 
the bulk electric system is inadvertently left unstudied.\49\ However, 
nothing in PRC-006-1 precludes entities from conducting additional 
assessments based on any island boundaries they wish to analyze.
---------------------------------------------------------------------------

    \48\ NOPR, FERC Stats & Regs. ] 32,682 at P 46.
    \49\ NERC Comments at 12; EEI Comments at 10.
---------------------------------------------------------------------------

    74. With respect to the comments from EPSA and PSEG, there are no 
Regional Reliability Standards currently before us in this matter and, 
therefore, the matter is not ripe for us to address.

G. Automatic Load Shedding and Manual Load Shedding

    75. In the NOPR, the Commission observed that there are no 
requirements in Reliability Standard PRC-006-1 to coordinate automatic 
load shedding by UFLS and manual load shedding under Reliability 
Standard EOP-003-2. The Commission noted that once load is disconnected 
from the system, either automatically or manually, it cannot be used 
again to arrest frequency decline. The Commission expressed concern 
that in the event that a load resource is double-counted and removed 
during automatic UFLS, the manual load shedding cannot be completed if 
called upon. Accordingly, the Commission stated that resources 
allocated to each type of load shedding (i.e., automatic and manual) 
should not overlap. The Commission sought comments on how the 
coordination of automatic and manual load shedding is considered in 
light of the fact that the Reliability Standards do not explicitly 
require coordination.
Comments
    76. NERC acknowledges that the Reliability Standards do not 
explicitly require coordination of manual load shedding and UFLS but 
states that

[[Page 27582]]

Reliability Standard EOP-003-2 addresses the concern that a load 
resource could be unintentionally double-counted. Specifically, NERC 
maintains that Requirement R6 of EOP-003-2 requires transmission 
operators and balancing authorities to include load in the manual load 
shedding program that is not included in the UFLS program to achieve 
the reliability objective of EOP-003-2.\50\
---------------------------------------------------------------------------

    \50\ NERC Comments at 12.
---------------------------------------------------------------------------

    77. Wisconsin Electric and FRCC state that it is difficult for a 
UFLS program not to overlap with manual loadshed plans. Wisconsin 
Electric comments that it is ``overly conservative to prevent a load 
from being used in both a UFLS program and a manual loadshed plan.'' 
\51\ Wisconsin Electric also observes that a reliability coordinator 
may require an entity to manually shed load that is part of a UFLS 
program, which the entity cannot ignore. FRCC maintains that a non-
overlap rule is likely to have a negative impact on reliability because 
it may reduce the amount of load available to address capacity 
emergencies. FRCC further contends that underfrequency events are rare 
and it is even less likely for an underfrequency event to coincide with 
a capacity emergency.
---------------------------------------------------------------------------

    \51\ Wisconsin Electric Comments at 3.
---------------------------------------------------------------------------

    78. Dominion states that the Commission should not force 
coordination of manual load shedding and UFLS load shedding because it 
would prevent balancing authorities and transmission operators from 
using currently available tools to manage emergency conditions. 
Dominion contrasts the precision of manual load shedding with the 
widespread automatic response provided by UFLS programs. According to 
Dominion, forced coordination could remove manual load shedding from 
the emergency response toolkit for local issues, which, according to 
Dominion, could allow them to turn into cascading events. EEI states 
that the purpose of UFLS programs and manual load shedding are 
separate. EEI argues that, while a broad understanding of the operation 
of each program is important, coordination to the level implied by the 
NOPR serves no purpose since each program addresses different problems. 
EEI further notes that coordination in the form of ``information 
sharing'' already occurs. NYISO also states that manual load shedding 
and UFLS address different issues and should be addressed in separate 
Reliability Standards.
    79. SWPA states that there is a need to address what consideration 
planning authorities give to other protective schemes and remedial 
action plans. SWPA maintains that Reliability Standard PRC-006-1 should 
address how a balancing authority and transmission operator address 
overlap concerns where most of its balancing authority area entities 
are subject to load shedding plans under Reliability Standard EOP-003-2 
but these loads are also subject to UFLS plans under PRC-006-1.
Commission Determination
    80. Based on the comments, we find that there is an adequate level 
of coordination between UFLS and manual load shedding. We are persuaded 
by NERC's comments that the term ``additional load'' in Reliability 
Standard EOP-003-2, Requirement R6, includes resources allocated to 
manual load shedding that are not included in the UFLS program. UFLS 
and manual load shedding programs are developed separately and have, as 
EEI stated, separate purposes. As such, to avoid insufficiencies in 
available load if manual load shedding is needed after UFLS has been 
activated, UFLS and manual load shedding programs cannot be planned to 
shed the same load.

H. Elimination of Requirements for Balancing Authorities in EOP-003-2

    81. In the NOPR, the Commission observed that Requirements R2, R4, 
and R7 of the currently-effective Reliability Standard EOP-003-1 apply 
to transmission operators and balancing authorities but that 
Reliability Standard EOP-003-2 eliminates balancing authorities from 
Requirements R2, R4, and R7. The Commission sought clarification as to 
why these balancing authority responsibilities were not incorporated 
into Reliability Standards PRC-006-1 or EOP-003-2. The Commission also 
sought comments as to why balancing authorities should not be informed 
of UFLS program plans that directly impact balancing authority 
functions.
Comments
    82. NERC states that Reliability Standard EOP-003-2 removes 
requirements on UFLS design, incorporates them in Reliability Standard 
PRC-006-1, and assigns those activities to planning coordinators. NERC 
further states that EOP-003-2 does not remove any requirements for 
UVLS, which are assigned to transmission operators. NERC maintains 
that, while balancing authorities contribute to managing 
Interconnection frequency by balancing load and generation resources in 
real-time, UFLS and UVLS programs are automatic and must be set in 
advance. NERC, however, agrees that balancing authorities should be 
informed of UFLS program plans that directly impact the balancing 
authority function.
    83. EEI, TAPS, MISO, Dominion and NYISO largely support NERC's 
comments. EEI states that the changes in Reliability Standard EOP-003-2 
are consistent with the roles and responsibilities of balancing 
authorities and transmission operators. EEI also maintains that 
balancing authorities are already informed of UFLS programs by 
transmission operators because balancing authorities and transmission 
operators ``are specifically identified as coordinating other load 
shedding plans as identified in EOP-003-2'' and to ``effectively 
develop those plans [balancing authorities] and [transmission 
operators] must have knowledge of the UFLS programs of which 
[transmission operators] are intimately aware through PRC-006-1.'' \52\
---------------------------------------------------------------------------

    \52\ EEI Comments at 13.
---------------------------------------------------------------------------

    84. TAPS states that Reliability Standards PRC-006-1 and EOP-003-2 
clarify the requirements in the existing Reliability Standards and 
assign them to the functional entities best suited to program design. 
TAPS also states that Reliability Standard PRC-001-1, Requirement R1 
ensures that balancing authorities are familiar with UFLS programs 
because the requirement provides that they ``shall be familiar with the 
purpose and limitations of protection system schemes applied in its 
area.'' \53\
---------------------------------------------------------------------------

    \53\ TAPS Comments at 8-9.
---------------------------------------------------------------------------

    85. MISO states that balancing authorities need not be informed of 
UFLS programs because planning coordinators are the functional entities 
tasked with overseeing those programs. MISO also contends that 
requiring planning coordinators to report to balancing authorities on 
UFLS programs would impose additional costs with little benefit to 
reliability. MISO notes, however, that balancing authorities could 
benefit if NERC periodically published prevailing UFLS set points by 
planning coordinator area.
    86. Dominion states that planning coordinators should not be 
required to inform balancing authorities of UFLS program plans because 
balancing authorities have no role in the design and implementation of 
UFLS and have no action to take to affect the successful operation of 
UFLS.
    87. NYISO comments that balancing authorities have no role in load 
shedding and agrees with the removal of

[[Page 27583]]

UFLS references from Reliability Standard EOP-003-2.
    88. SWPA states that balancing authorities, by definition, do not 
perform the functions referred to in Reliability Standards PRC-006-1 or 
EOP-003-2, Requirements R2, R4, and R7. However, SWPA believes that 
PRC-006-1 should incorporate language that ensures that balancing 
authorities are kept informed of UFLS program plans that directly 
impact the balancing authority functions.
Commission Determination
    89. The Commission accepts the elimination of requirements for 
balancing authorities in Reliability Standard EOP-003-2. NERC states in 
its comments that ``all activities required for UFLS programs in the 
existing standards are incorporated into PRC-006-1, and are assigned to 
the Planning Coordinator,'' \54\ and that balancing authorities will 
still be made aware of UFLS programs in order to ``be familiar with the 
purpose and limitations of protection system schemes applied in its 
area,'' \55\ as stated in Reliability Standard PRC-001-1, Requirement 
R1. To that end, the Commission believes that the comments address the 
questions raised in the NOPR regarding the elimination of balancing 
authority responsibility for Requirements R2, R4, and R7 of EOP-003-2.
---------------------------------------------------------------------------

    \54\ NERC Comments at 13.
    \55\ NERC Comments at 14.
---------------------------------------------------------------------------

I. Violation Risk Factors and Violation Severity Levels

    90. In the NOPR, the Commission proposed to approve the VRFs and 
VSLs in Reliability Standards PRC-006-1 and EOP-003-2. However, the 
Commission sought comments on one VSL and one VRF for PRC-006-1.
    91. The Commission stated that the ``Lower VSL'' assignment for 
Requirement R8 in PRC-006-1 applies when a UFLS entity fails to provide 
data to its planning coordinator for 5 to 10 calendar days following 
the schedule specified by the planning coordinator. The Commission 
noted in the NOPR that Requirement R8 of PRC-006-1 does not include a 
5-day grace period for providing data to planning coordinators and thus 
the subject VSL assignment may be inconsistent with the Commission's 
VSL Guideline 3.
    92. The Commission noted that NERC proposed a ``Medium'' VRF for 
Reliability Standard PRC-006-1, Requirement R5, which requires planning 
coordinators to coordinate their UFLS program design with other 
planning coordinators whose area is in part of the same identified 
island. The Commission observed the statement in NERC's petition that 
Requirement R5 is ``not related to similar reliability goals in other 
standards.'' \56\ However, the Commission explained that coordination 
of load shedding plans is required in a similar manner in Requirement 
R3 of currently-effective Reliability Standard EOP-003-1, which 
includes a VRF of ``High.'' \57\ The Commission stated that the lack of 
coordination of UFLS programs among planning coordinators within the 
same identified island could lead to ineffective UFLS operations and 
further cascading outages within the island when UFLS is activated. The 
Commission explained that this might be inconsistent with Guideline 3 
of the Commission's VRF Guidelines states that ``[a]bsent justification 
to the contrary, the Commission expects the assignment of Violation 
Risk Factors corresponding to Requirements that address similar 
reliability goals in different Reliability Standards would be treated 
comparably.'' \58\
---------------------------------------------------------------------------

    \56\ NERC Petition at 46.
    \57\ Reliability Standard EOP-003-2 includes the same VRF 
assignment of ``High'' for Requirement R3.
    \58\ North American Electric Reliability Corp., 119 FERC ] 
61,145, at P 25 (2007).
---------------------------------------------------------------------------

Comments
    93. NERC agrees with the NOPR regarding both the ``Lower VSL'' for 
Requirement R8 of Reliability Standard PRC-006-1 and the VRF for 
Requirement R5 of PRC-006-1. In its comments, NERC proposes to modify 
the ``Lower VSL'' to remove the phrase ``more than 5 calendar days 
but'' to address the concern stated in the NOPR. NERC also proposes to 
modify the VRF for Requirement R5 by raising it from ``Medium'' to 
``High.''
    94. EEI, SWPA, and NYISO agree with the need to modify the VSL for 
Requirement R8 of PRC-006-1, consistent with NERC's proposal. NYISO 
also supports changing the VRF for PRC-006-1, Requirement R5.
Commission Determination
    95. Consistent with the proposal in NERC's comments, the Commission 
directs the ERO to modify the language of the Lower VSL for Reliability 
Standard PRC-006-1, Requirement R8 and the Medium VRF for PRC-006-1, 
Requirement R5. NERC is directed to submit the revised VRF and VSL 
within 30 days of the effective date of this final rule.

J. Implementation Plan and Effective Date

    96. In the NOPR, the Commission noted that NERC requests an 
effective date for Reliability Standards PRC-006-1 and EOP-003-2 of one 
year following the first day of the first calendar quarter after 
applicable regulatory approvals with respect to all Requirements of the 
proposed Reliability Standards except Parts 4.1 through 4.6 of 
Requirement R4 of PRC-006-1. With respect to Parts 4.1 through 4.6 of 
Requirement R4 of PRC-006-1, NERC requests an effective date of one 
year following the receipt of generation data as required in 
Reliability Standard PRC-024-1,\59\ but no sooner than one year 
following the first day of the first calendar quarter after applicable 
regulatory approvals of PRC-006-1. The Commission sought comments about 
any potential reliability gaps that may occur during the development 
and implementation of PRC-024-1, such as how the planning coordinators 
will adequately determine and apply UFLS simulations and plans in the 
absence of generator trip settings.
---------------------------------------------------------------------------

    \59\ Draft Reliability Standard PRC-024-1 addresses ``Generator 
Performance During Frequency and Voltage Excursions'' and is 
currently being developed in the NERC standard drafting process 
under Project 2007-09 (Generator Verification), which is one of 
NERC's priority projects.
---------------------------------------------------------------------------

Comments
    97. NERC maintains that there should not be a reliability gap 
because planning coordinators have access to and utilize trip settings 
in UFLS assessments. NERC explains its proposal by noting that 
generator owners currently cannot be compelled to provide trip settings 
to planning coordinators. NERC states that the implementation schedule 
defers a compliance obligation for planning coordinators to model the 
trip settings until a compliance obligation for generator owners to 
provide these settings exists.
    98. EEI believes that a reliability gap will exist until draft 
Reliability Standard PRC-024-1 is approved, but it believes that the 
gap is minor and manageable. EEI agrees with NERC that information that 
will be mandated in PRC-024-1 is already supplied through mutual 
cooperation between entities. EEI states that the Commission might 
consider directing NERC to reevaluate its priority list to determine if 
the PRC-024-1 project is being given sufficient priority.
    99. TAPS comments that planning coordinators have the ability to 
run UFLS simulations, even though modeling generator trip settings is 
not currently mandatory, because all

[[Page 27584]]

significantly sized generators are included in models. TAPS contends 
that while some generators that trip outside of the UFLS set points may 
not be modeled, this will not have a significant impact on the 
reliability of the bulk electric system.
Commission Determination
    100. The Commission approves the implementation plan and effective 
dates of Reliability Standards PRC-006-1 and EOP-003-2. We agree with 
EEI that there is a reliability gap given the lack of mandatory 
requirements for providing generator trip settings, which will continue 
until draft Reliability Standard PRC-024-1 is approved. The Commission, 
however, also agrees with EEI that the gap is limited because the 
information mandated by PRC-024-1 is already supplied through mutual 
cooperation between utilities. To ensure that any gap pending 
implementation of PRC-024-1 remains limited, the Commission encourages 
the current practice of voluntarily sharing generator trip settings 
between entities to continue.

III. Information Collection Statement

    101. The Office of Management and Budget (OMB) regulations require 
that OMB approve certain reporting and recordkeeping (collections of 
information) imposed by an agency.\60\ Upon approval of a collection(s) 
of information, OMB will assign an OMB control number and expiration 
date. Respondents subject to the filing requirements of this rule will 
not be penalized for failing to respond to these collections of 
information unless the collections of information display a valid OMB 
control number.
---------------------------------------------------------------------------

    \60\ 5 CFR 1320.11.
---------------------------------------------------------------------------

    102. The Commission is submitting these reporting and recordkeeping 
requirements to OMB for its review and approval under section 3507(d) 
of Paperwork Reduction Act of 1995.\61\ The Commission solicited 
comments on the need for and the purpose of the information contained 
in Reliability Standard PRC-006-1 and EOP-003-2 and the corresponding 
burden to implement them. The Commission received comments on specific 
requirements in the Reliability Standards, which we address in this 
final rule. However, we did not receive any comments on our reporting 
burden estimates.
---------------------------------------------------------------------------

    \61\ 44 U.S.C. 3507(d)
---------------------------------------------------------------------------

    103. This final rule approves Reliability Standards PRC-006-1 and 
EOP-003-2, which would replace currently effective Reliability 
Standards PRC-007-0, PRC-009-0, EOP-003-1 and NERC-approved Reliability 
Standard PRC-006-0.\62\ As noted previously, Reliability Standard PRC-
006-0 was never approved by the Commission, and therefore has never 
been mandatory and enforceable. On the other hand, Reliability 
Standards PRC-007-0 and PRC-009-0 were approved by the Commission and 
are currently mandatory and enforceable. Because Proposed Reliability 
Standard PRC-006-1 incorporates the requirements from Reliability 
Standards PRC-006-0, PRC-007-0, and PRC-009-0 some of the existing 
requirements will become mandatory and enforceable (where previously 
they were voluntary), while others continue to be so. To properly 
account for the burden on respondents, the Commission will treat the 
burden resulting from NERC-approved Reliability Standard PRC-006-0 as 
essentially new to the industry, even though it is likely that most 
applicable entities have already been complying.\63\
---------------------------------------------------------------------------

    \62\ PRC-006-0 was not approved by the Commission but remained 
effective as a NERC-approved standard (but not mandatory or 
enforceable). The other three standards were approved by the 
Commission. Mandatory Reliability Standards for the Bulk-Power 
System, Order No. 693, FERC Stats. & Regs. ] 31,242, order on reh'g, 
Order No. 693-A, 120 FERC ] 61,053 (2007).
    \63\ This statement is made because currently effective 
Reliability Standards PRC-007-0 and PRC-009-0 required UFLS entities 
to follow the UFLS program implemented by Reliability Standard PRC-
006-0. Therefore, it is likely that entities have already been 
following the requirements contained in Reliability Standard PRC-
006-0.
---------------------------------------------------------------------------

    104. The reporting requirements in Reliability Standard EOP-003-2 
are virtually the same as those in currently effective Reliability 
Standard EOP-003-1. The difference is that Reliability Standard EOP-
003-2 eliminates balancing authorities from Requirements R2 and from 
Measure M1.\64\ This requirement and measure deal with establishing and 
documenting automatic load shedding plans.
---------------------------------------------------------------------------

    \64\ Balancing authorities are also removed from Requirements R4 
and R7, but these do not have reporting requirements associated with 
them.
---------------------------------------------------------------------------

    105. Public Reporting Burden: Our estimate below regarding the 
number of respondents is based on the NERC compliance registry as of 
July 29, 2011. According to the NERC compliance registry, there are 72 
planning coordinators and 126 balancing authorities. The individual 
burden estimates are based on the time needed to gather data, run 
studies, and analyze study results to design or update the UFLS 
programs. Additionally, documentation and the review of UFLS program 
results by supervisors and management is included in the administrative 
estimations. These are consistent with estimates for similar tasks in 
other Commission approved standards.
---------------------------------------------------------------------------

    \65\ Reliability Standard PRC-006-1 applies to both planning 
coordinators and to UFLS entities. However, the burden associated 
with the UFLS entities is not new because it was accounted for under 
Commission approved Reliability Standards PRC-007-0 and PRC-009-0.
    \66\ Transmission operators also have to comply with Reliability 
Standard EOP-003-2. Since the applicable reporting requirements (and 
associated burden) have not changed from the existing standard, 
these entities are not included here.
    *PC = Planning Coordinator; BA = Balancing Authority.

----------------------------------------------------------------------------------------------------------------
                                           Number of      Number of
PRC-006-1 (automatic underfrequency load  respondents   responses per    Average  burden hours     Total annual
             shedding) \65\                 annually     respondent           per response         burden hours
----------------------------------------------------------------------------------------------------------------
                                                  (1)             (2)                        (3)     (1) x (2) x
                                                                                                             (3)
----------------------------------------------------------------------------------------------------------------
PCs*: Design and document Automatic UFLS           72               1                        120           8,640
 Program................................
PCs: Management Review of Documentation.           72               1                         40           2,880
PCs: Record Retention...................           72               1                         16           1,152
                                         -----------------------------------------------------------------------
    Total...............................  ...........  ..............  .........................          12,672
----------------------------------------------------------------------------------------------------------------


 
 
----------------------------------------------------------------------------------------------------------------
EOP-003-2 (Load Shedding Plans)
 \66\
Removal of BAs* from Reporting               126               1  Reporting............      -10          -1,260
 Requirements in R2 and M1 (Burden           126               1  Record Retention.....       -1            -126
 Reduction).
    Total..........................  ...........  ..............  .....................  .......          -1,386
                                    ----------------------------------------------------------------------------
Net Change in Burden (Total Annual   ...........  ..............  .....................  .......          11,286
 Hours for Collection).


[[Page 27585]]

    Total Net Annual Cost (Reporting + Record Retention) \67\: = 
$1,414,656 - $154,728 = $1,259,928.
---------------------------------------------------------------------------

    \67\ The hourly reporting cost is based on the cost of an 
engineer to implement the requirements of the rule. The record 
retention cost comes from Commission staff research on record 
retention requirements.
---------------------------------------------------------------------------

    [ssquf] Total Reporting Cost for Planning Coordinators: = 11,520 
hours @ $120/hour = $1,382,400.
    [ssquf] Total Record Retention Cost for Planning Coordinators: 
1,152 hours @ $28/hour = $32,256.
    [ssquf] Total Reporting and Record Retention Cost Savings for 
Balancing Authorities: = (1,260 hours @ $120/hour) + (126 hours @ $28/
hour) = $154,728.
    Title: Mandatory Reliability Standards for the Bulk-Power System
    Action: Proposed Collection FERC-725A.
    OMB Control No.: 1902-0244.
    Respondents: Businesses or other for-profit institutions; not-for-
profit institutions.
    Frequency of Responses: On Occasion.
    Necessity of the Information: This Final Rule approves the 
requested modifications to Reliability Standards pertaining to 
automatic underfrequency load shedding. The Reliability Standards help 
ensure the reliable operation of the bulk electric system by arresting 
declining frequency and assisting recovery of frequency following 
system events leading to frequency degradation.
    Internal Review: The Commission has reviewed the Reliability 
Standards and made a determination that its action is necessary to 
implement section 215 of the FPA. These requirements, if accepted, 
should conform to the Commission's expectation for UFLS programs as 
well as procedures within the energy industry.
    106. Interested persons may obtain information on the reporting 
requirements by contacting the following: Federal Energy Regulatory 
Commission, 888 First Street NE., Washington, DC 20426 [Attention: 
Ellen Brown, Office of the Executive Director, email: 
DataClearance@ferc.gov, phone: (202) 502-8663, fax: (202) 273-0873].
    107. For submitting comments concerning the collection(s) of 
information and the associated burden estimate(s), please send your 
comments to the Commission and to the Office of Management and Budget, 
Office of Information and Regulatory Affairs, Washington, DC 20503 
[Attention: Desk Officer for the Federal Energy Regulatory Commission, 
phone: (202) 395-4638, fax: (202) 395-7285]. For security reasons, 
comments to OMB should be submitted by email to: oira_submission@omb.eop.gov. Comments submitted to OMB should include Docket 
Number RM11-20 and OMB Control Number 1902-0244.

IV. Environmental Analysis

    108. The Commission is required to prepare an Environmental 
Assessment or an Environmental Impact Statement for any action that may 
have a significant adverse effect on the human environment.\68\ The 
Commission has categorically excluded certain actions from this 
requirement as not having a significant effect on the human 
environment. Included in the exclusion are rules that are clarifying, 
corrective, or procedural or that do not substantially change the 
effect of the regulations being amended.\69\ The actions proposed here 
fall within this categorical exclusion in the Commission's regulations.
---------------------------------------------------------------------------

    \68\ Regulations Implementing the National Environmental Policy 
Act of 1969, Order No. 486, 52 FR 47897 (Dec. 17, 1987), FERC Stats. 
& Regs., Regulations Preambles 1986-1990 ] 30,783 (1987).
    \69\ 18 CFR 380.4(a)(2)(ii).
---------------------------------------------------------------------------

V. Regulatory Flexibility Act

    109. The Regulatory Flexibility Act of 1980 (RFA) \70\ generally 
requires a description and analysis of final rules that will have 
significant economic impact on a substantial number of small entities. 
The RFA mandates consideration of regulatory alternatives that 
accomplish the stated objectives of a proposed rule and that minimize 
any significant economic impact on a substantial number of small 
entities. The Small Business Administration's (SBA) Office of Size 
Standards develops the numerical definition of a small business.\71\ 
The SBA has established a size standard for electric utilities, stating 
that a firm is small if, including its affiliates, it is primarily 
engaged in the transmission, generation and/or distribution of electric 
energy for sale and its total electric output for the preceding twelve 
months did not exceed four million megawatt hours.\72\
---------------------------------------------------------------------------

    \70\ 5 U.S.C. 601-612.
    \71\ 13 CFR 121.101.
    \72\ 13 CFR 121.201, Sector 22, Utilities & n.1.
---------------------------------------------------------------------------

    110. Reliability Standard PRC-006-1 establishes design, assessment, 
and documentation requirements for automatic UFLS programs. It will be 
applicable to planning coordinators and entities that are responsible 
for the ownership, operation, or control of UFLS equipment. Reliability 
Standard EOP-003-2 removes balancing authorities from having to comply 
with Requirement R2 and Measure M1 of the standard. Comparison of the 
NERC compliance registry with data submitted to the Energy Information 
Administration on Form EIA-861 indicates that perhaps as many as 8 
small entities are registered as planning coordinators and 18 small 
entities are registered as balancing authorities. The Commission 
estimates that the small planning coordinators to whom the Reliability 
Standard will apply will incur compliance and recordkeeping costs of 
$157,184 ($19,648 per planning coordinator) associated with the 
Standard's requirements. The small balancing authorities will receive a 
savings of $154,728 ($8,596 per balancing authority). Accordingly, 
Reliability Standards PRC-006-1 and EOP-003-2 should not impose a 
significant operating cost increase or decrease on the affected small 
entities.
    111. Based on this understanding, the Commission certifies that 
these Reliability Standards will not have a significant economic impact 
on a substantial number of small entities. Accordingly, no regulatory 
flexibility analysis is required.

VI. Document Availability

    112. In addition to publishing the full text of this document in 
the Federal Register, the Commission provides all interested persons an 
opportunity to view and/or print the contents of this document via the 
Internet through FERC's Home Page (http://www.ferc.gov) and in FERC's 
Public Reference Room during normal business hours (8:30 a.m. to 5:00 
p.m. Eastern time) at 888 First Street NE., Room 2A, Washington DC 
20426.
    113. From FERC's Home Page on the Internet, this information is 
available on eLibrary. The full text of this document is available on 
eLibrary in PDF and Microsoft Word format for viewing, printing, and/or 
downloading. To access this document in eLibrary, type the docket 
number excluding the last three digits of this document in the docket 
number field.

[[Page 27586]]

    114. User assistance is available for eLibrary and the FERC's Web 
site during normal business hours from FERC Online Support at 202-502-
6652 (toll free at 1-866-208-3676) or email at 
ferconlinesupport@ferc.gov, or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at 
public.referenceroom@ferc.gov.

VII. Effective Date and Congressional Notification

    115. These regulations are effective July 10, 2012. The Commission 
has determined, with the concurrence of the Administrator of the Office 
of Information and Regulatory Affairs of OMB, that this rule is not a 
``major rule'' as defined in section 351 of the Small Business 
Regulatory Enforcement Fairness Act of 1996.

List of Subjects in 18 CFR Part 40

    Electric power; Electric utilities; Reporting and record keeping 
requirements.

    By the Commission.
Nathaniel J. Davis, Sr.,
Deputy Secretary.

Appendix

Commenters

------------------------------------------------------------------------
         Abbreviation                          Commenter
------------------------------------------------------------------------
Dominion.....................  Dominion Resources Services, Inc.
EEI..........................  Edison Electric Institute.
EPSA.........................  Electric Power Supply Association.
FRCC.........................  Florida Reliability Coordinating Council,
                                Inc.
G&T Cooperatives.............  Associated Electric Cooperative, Inc.;
                                Basin Electric Power Cooperative; and
                                Tri-State Generation and Transmission
                                Association, Inc.
KCP&L........................  Kansas City Power & Light Company and
                                KCP&L Greater Missouri Operations
                                Company.
MISO.........................  Midwest Independent Transmission System
                                Operator, Inc.
NERC.........................   North American Electric Reliability
                                Corporation.
NYISO........................   New York Independent System Operator,
                                Inc.
PSEG.........................  Public Service Electric and Gas Company;
                                PSEG Power LLC; PSEG Energy Resources &
                                Trade LLC.
SWPA.........................  Southwestern Power Administration.
TAPS.........................  Transmission Access Policy Study Group.
Wisconsin Electric...........  Wisconsin Electric Power Company.
------------------------------------------------------------------------

[FR Doc. 2012-11316 Filed 5-10-12; 8:45 am]
BILLING CODE 6717-01-P


