
[Federal Register Volume 77, Number 142 (Tuesday, July 24, 2012)]
[Proposed Rules]
[Pages 43190-43196]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-18009]



[[Page 43190]]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 40

[Docket No. RM12-9-000]


Regional Reliability Standard PRC-006-SERC-01--Automatic 
Underfrequency Load Shedding Requirements

AGENCY: Federal Energy Regulatory Commission, Energy.

ACTION: Notice of Proposed Rulemaking.

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SUMMARY: Under section 215 of the Federal Power Act (FPA), the Federal 
Energy Regulatory Commission (Commission) proposes to approve regional 
Reliability Standard PRC-006-SERC-01 (Automatic Underfrequency Load 
Shedding Requirements) submitted to the Commission for approval by the 
North American Electric Reliability Corporation (NERC). Regional 
Reliability Standard, PRC-006-SERC-01, is designed to ensure that 
automatic underfrequency load shedding protection schemes designed by 
planning coordinators and implemented by applicable distribution 
providers and transmission owners in the SERC Reliability Corporation 
(SERC) Region are coordinated to effectively mitigate the consequences 
of an underfrequency event. The Commission also proposes to approve the 
related violation risk factors, with one modification, and violation 
severity levels, implementation plan, and effective date proposed by 
NERC.

DATES: Comments are due September 24, 2012.

ADDRESSES: Comments, identified by docket number, may be filed in the 
following ways:
     Electronic Filing through http://www.ferc.gov. Documents 
created electronically using word processing software should be filed 
in native applications or print-to-PDF format and not in a scanned 
format.
     Mail/Hand Delivery: Those unable to file electronically 
may mail or hand-deliver comments to: Federal Energy Regulatory 
Commission, Secretary of the Commission, 888 First Street NE., 
Washington, DC 20426.
    Instructions: For detailed instructions on submitting comments and 
additional information on the rulemaking process, see the Comment 
Procedures Section of this document.

FOR FURTHER INFORMATION CONTACT: Susan Morris (Technical Information), 
Office of Electric Reliability, Division of Reliability Standards, 
Federal Energy Regulatory Commission, 888 First Street NE., Washington, 
DC 20426, Telephone: (202) 502-6803, Susan.Morris@ferc.gov.
    Matthew Vlissides (Legal Information), Office of the General 
Counsel, Federal Energy Regulatory Commission, 888 First Street NE., 
Washington, DC 20426, Telephone: (202) 502-8408, 
Matthew.Vlissides@ferc.gov.

SUPPLEMENTARY INFORMATION:

140 FERC ] 61,056

Notice of Proposed Rulemaking

(Issued July 19, 2012)
    1. Under section 215 of the Federal Power Act (FPA), the Federal 
Energy Regulatory Commission (Commission) proposes to approve regional 
Reliability Standard PRC-006-SERC-01 (Automatic Underfrequency Load 
Shedding (UFLS) Requirements) in the SERC Reliability Corporation 
(SERC) \1\ Region. The Commission also proposes to approve the related 
violation risk factors (VRFs), with one modification, and violation 
severity levels (VSLs), implementation plan, and effective date 
proposed by the North American Electric Reliability Corporation (NERC). 
Regional Reliability Standard PRC-006-SERC-01 was submitted to the 
Commission for approval by NERC and is designed to ensure that 
automatic UFLS protection schemes designed by planning coordinators and 
implemented by applicable distribution providers and transmission 
owners in the SERC Region are coordinated to effectively mitigate the 
consequences of an underfrequency event.
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    \1\ SERC amended its Articles of Incorporation on May 9, 2006 to 
change its name from Southeastern Electric Reliability Council to 
SERC Reliability Corporation. Available at http://serc1.org/Documents/Regional%20Entity%20Documents1/Regional 
%20Entity%20Documents%20(All)/Name%20Change%205-17-06%20SFX4C5F.pdf.
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I. Background

A. Mandatory Reliability Standards

    2. Section 215 of the FPA requires a Commission-certified Electric 
Reliability Organization (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 
NERC, subject to Commission oversight, or by the Commission 
independently.\2\
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    \2\ See 16 U.S.C. 824o(e) (2006).
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    3. Reliability Standards that NERC proposes to the Commission may 
include Reliability Standards that are proposed by a Regional Entity to 
be effective in that region.\3\ In Order No. 672, the Commission noted 
that:
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    \3\ 16 U.S.C. 824o(e)(4). A Regional Entity is an entity that 
has been approved by the Commission to enforce Reliability Standards 
under delegated authority from the ERO. See 16 U.S.C. 824o(a)(7) and 
(e)(4).

    As a general matter, we will accept the following two types of 
regional differences, provided they are otherwise just, reasonable, 
not unduly discriminatory or preferential and in the public 
interest, as required under the statute: (1) A regional difference 
that is more stringent than the continent-wide Reliability Standard, 
including a regional difference that addresses matters that the 
continent-wide Reliability Standard does not; and (2) a regional 
Reliability Standard that is necessitated by a physical difference 
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in the Bulk-Power System.

When NERC reviews a regional Reliability Standard that would be 
applicable on an interconnection-wide basis and that has been proposed 
by a Regional Entity organized on an interconnection-wide basis, NERC 
must rebuttably presume that the regional Reliability Standard is just, 
reasonable, not unduly discriminatory or preferential, and in the 
public interest.\4\ In turn, the Commission must give ``due weight'' to 
the technical expertise of NERC and of a Regional Entity organized on 
an interconnection-wide basis.\5\
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    \4\ 16 U.S.C. 824o(d)(3).
    \5\ Id. Sec.  824o(d)(2).
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    4. On April 19, 2007, the Commission accepted delegation agreements 
between NERC and each of the eight Regional Entities.\6\ In the order, 
the Commission accepted SERC as a Regional Entity organized on less 
than an interconnection-wide basis. As a Regional Entity, SERC oversees 
Bulk-Power System reliability within the SERC Region, which covers a 
geographic area of approximately 560,000 square miles in a sixteen-
state area in the southeastern and central United States (all of 
Missouri, Alabama, Tennessee, North Carolina, South Carolina, Georgia, 
Mississippi, and portions of Iowa, Illinois, Kentucky, Virginia, 
Oklahoma, Arkansas, Louisiana, Texas and Florida). The SERC Region is 
currently geographically divided into five subregions that are 
identified as Southeastern, Central, VACAR, Delta, and Gateway.
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    \6\ North American Electric Reliability Corp., 119 FERC ] 61,060 
(2007).
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B. Proposed Regional Reliability Standard PRC-006-SERC-01

    5. On February 1, 2012, NERC submitted a petition to the Commission 
seeking approval of regional Reliability

[[Page 43191]]

Standard PRC-006-SERC-01.\7\ NERC requests approval of the regional 
Reliability Standard, associated VRFs and VSLs, and the implementation 
plan for PRC-006-SERC-01. NERC requests the standard become effective 
over a 30-month window following the effective date of a final rule in 
this docket, as provided in NERC's implementation plan, to allow 
entities to respond to any changes in UFLS settings. NERC states that 
this is the first request for Commission approval of this proposed 
regional Reliability Standard and that it will only apply to applicable 
registered entities within the SERC Region. NERC also states that the 
NERC continent-wide Reliability Standards do not presently address the 
issues covered in regional Reliability Standard PRC-006-SERC-01.
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    \7\ North American Electric Reliability Corp., February 1, 2012 
Petition for Approval of Regional Reliability Standard PRC-006-SERC-
01 (NERC Petition). The proposed new Regional Reliability Standard 
is not codified in the CFR. However, it is available on the 
Commission's eLibrary document retrieval system in Docket No. RM12-
9-000 and is available on the NERC's Web site, www.nerc.com.
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    6. NERC states that regional Reliability Standard PRC-006-SERC-01 
was developed to be consistent with the NERC UFLS Reliability Standard 
PRC-006-1.\8\ Regional Reliability Standard PRC-006-SERC-01 is designed 
to ensure that automatic UFLS protection schemes designed by planning 
coordinators and implemented by applicable distribution providers and 
transmission owners in the SERC Region are coordinated to effectively 
mitigate the consequences of an underfrequency event.\9\
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    \8\ See Automatic Underfrequency Load Shedding and Load Shedding 
Plans Reliability Standards, Order No. 763, 139 FERC ] 61,098 (May 
7, 2012) (approving Reliability Standards PRC-006-1 (Automatic 
Underfrequency Load Shedding) and EOP-003-2 (Load Shedding Plans)).
    \9\ NERC Petition at 7.
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    7. NERC states that the proposed regional Reliability Standard 
satisfies the factors set forth in Order No. 672 that the Commission 
considers when determining whether a proposed Reliability Standard is 
just, reasonable, not unduly discriminatory or preferential and in the 
public interest.\10\ NERC states that regional Reliability Standard 
PRC-006-SERC-01 adds specificity not contained in the NERC UFLS 
Reliability Standard for UFLS schemes in the SERC Region.\11\ NERC 
states that regional Reliability Standard PRC-006-SERC-01 effectively 
mitigates, in conjunction with Reliability Standard PRC-006-1, the 
consequences of an underfrequency event while accommodating differences 
in system transmission and distribution topology among SERC planning 
coordinators resulting from historical design criteria, makeup of load 
demands, and generation resources.\12\
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    \10\ 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, at PP 323-337 (2006), order on reh'g, Order 
No. 672-A, FERC Stats. & Regs. ] 31,212 (2006).
    \11\ NERC Petition at 18.
    \12\ Id. at 18-19.
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    8. According to NERC, regional Reliability Standard PRC-006-SERC-01 
is clear and unambiguous regarding what is required and who is required 
to comply. The proposed regional Reliability Standard is applicable to 
generator owners, planning coordinators, and UFLS entities in the SERC 
Region. The term ``UFLS entities'' (as noted in Reliability Standard 
PRC-006-1) means all entities that are responsible for the ownership, 
operation, or control of automatic UFLS equipment as required by the 
UFLS program established by the Planning Coordinators.\13\ NERC states 
that such entities may include distribution providers and transmission 
owners. NERC also states that each requirement of PRC-006-SERC-01 has 
an associated measure of compliance that will assist those enforcing 
the standard to enforce it in a consistent and non-preferential 
manner.Proposed regional Reliability Standard PRC-006-SERC-01 contains 
eight requirements, summarized as follows:
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    \13\ NERC Petition at 7 (citing NERC Reliability Standard PRC-
006-1, available at http://www.nerc.com/files/PRC-006-1.pdf).
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    Requirement R1 requires each planning coordinator to include its 
SERC subregion as an identified island when developing criteria for 
selecting portions of the Bulk-Power System that may form islands;
    Requirement R2 requires each planning coordinator to select or 
develop an automatic UFLS scheme (percent of load to be shed, frequency 
set points, and time delays) for implementation by UFLS entities within 
its area that meets the specified minimum requirements;
    Requirement R3 requires each planning coordinator to conduct 
simulations of its UFLS scheme for an imbalance between load and 
generation of 13 percent, 22 percent, and 25 percent for all identified 
islands;
    Requirement R4 requires each UFLS entity that has a total load of 
100 MW or greater in a planning coordinator area in the SERC Region to 
implement the UFLS scheme developed by their planning coordinator 
within specified tolerances;
    Requirement R5 requires each UFLS entity that has a total load less 
than 100 MW in a planning coordinator area in the SERC Region to 
implement the UFLS scheme developed by their planning coordinator 
within specified tolerances, but specifies that those entities shall 
not be required to have more than one UFLS step;
    Requirement R6 requires each UFLS entity in the SERC Region to 
implement changes to the UFLS scheme which involve frequency settings, 
relay time delays, or changes to the percentage of load in the scheme 
within 18 months of notification by the planning coordinator;
    Requirement R7 requires each planning coordinator to provide 
specified information concerning their UFLS scheme to SERC according to 
the schedule specified by SERC; and
    Requirement R8 requires each generator owner to provide specified 
generator underfrequency and overfrequency protection information 
within 30 days of a request by SERC to facilitate post-event analysis 
of frequency disturbances.
    9. NERC also explains that the proposed regional Reliability 
Standard sets minimum automatic UFLS design requirements, which are 
equivalent to the design requirements in the SERC UFLS program that has 
been in effect since September 3, 1999.\14\ NERC states that the one 
change relative to the existing SERC UFLS program is the addition of a 
minimum time delay requirement. The addition allows planning 
coordinators to use current UFLS schemes if those schemes meet the 
performance requirements specified in the NERC UFLS standard. 
Therefore, NERC concludes that the distribution providers and 
transmission owners subject to the proposed regional Reliability 
Standard will have to make minimal changes to implement their portions 
of the UFLS schemes.
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    \14\ NERC Petition at 12.
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    10. NERC also proposes VRFs and VSLs for the regional Reliability 
Standard, an implementation plan, and an effective date. NERC states 
that these aspects were developed and reviewed for consistency with 
NERC and Commission guidelines.
    11. NERC proposes specific implementation plans for each 
requirement in the regional Reliability Standard, as identified below, 
with the regional Reliability Standard becoming fully effective thirty 
months after the first day of the first quarter following regulatory 
approval. NERC states that the implementation time is reasonable, as it 
balances the need for reliability

[[Page 43192]]

with the practicability of implementation.
    12. NERC proposes that Requirement R1 of PRC-006-SERC-01 become 
effective twelve months after the first day of the first quarter 
following regulatory approval, but no sooner than twelve months 
following regulatory approval of Reliability Standard PRC-006-1. NERC 
states that this twelve-month period is consistent with the effective 
date of Requirement R2 of Reliability Standard PRC-006-1. Requirement 
R2 of PRC-006-SERC-01 would become effective twelve months after the 
first day of the first quarter following regulatory approval. NERC 
states that this twelve-month period is needed to allow time for 
entities to ensure a minimum time delay of six cycles on existing 
automatic UFLS relays as specified in Sub-requirement R2.6. Requirement 
R3 would become effective eighteen months after the first day of the 
first quarter following regulatory approval. NERC explains that this 
additional six-month period is needed to allow time to perform and 
coordinate studies necessary to assess the overall effectiveness of the 
UFLS schemes in the SERC Region. Requirements R4, R5, and R6 would 
become effective thirty months after the first day of the first quarter 
following regulatory approval. NERC states that this additional 
eighteen months is needed to allow time for any necessary changes to be 
made to the existing UFLS schemes in the SERC Region. Requirement R7 
would become effective six months following the effective date of 
Requirement R8 of Reliability Standard PRC-006-1, but no sooner than 
one year following the first day of the first calendar quarter after 
applicable regulatory approval of PRC-006-SERC-01. Finally, Requirement 
R8 of PRC-006-SERC-01 would become effective twelve months after the 
first day of the first quarter following regulatory approval. NERC 
states that this twelve-month period is needed to allow time for 
generator owners to collect and make an initial data filing.

II. Discussion

A. PRC-006-SERC-01

    13. Pursuant to FPA section 215(d)(2), we propose to approve 
regional Reliability Standard PRC-006-SERC-01 as just, reasonable, not 
unduly discriminatory or preferential, and in the public interest. PRC-
006-SERC-01 is designed to work in conjunction with NERC Standard PRC-
006-1 to effectively mitigate the consequences of an underfrequency 
event while accommodating differences in system transmission and 
distribution topology among SERC Planning Coordinators due to 
historical design criteria, makeup of load demands, and generation 
resources.\15\ As indicated above, PRC-006-SERC-01 covers topics not 
covered by the corresponding NERC Reliability Standard PRC-006-1 
because it adds specificity for UFLS schemes in the SERC Region. For 
example, Requirement R1 of the proposed regional Reliability Standard 
PRC-006-SERC-01 requires all planning coordinators in the SERC Region 
to include their respective ``SERC subregion as an identified island 
when developing criteria for selecting portions of the [Bulk-Power 
System] that may form islands.'' \16\ This requirement goes beyond the 
corresponding requirement in Reliability Standard PRC-006-1 that a 
planning coordinator study the entire region as an island.
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    \15\ NERC Petition at 18.
    \16\ NERC Petition, Exhibit C at 6.
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    14. While we propose to approve regional Reliability Standard PRC-
006-SERC-01, we identify a possible inconsistency between Requirement 
R6 of the proposed regional Reliability Standard and PRC-006-1, which 
the Commission addressed in Order No. 763. Reliability Standard PRC-
SERC-006-01, Requirement R6 states:

    R6. Each UFLS entity shall implement changes to the UFLS scheme 
which involve frequency settings, relay time delays, or changes to 
the percentage of load in the scheme within 18 months of 
notification by the Planning Coordinator. [Violation Risk Factor: 
Medium][Time Horizon: Long-term Planning]

The rationale for Requirement R6 included in the NERC petition is the 
following:

    Rationale for R6: The SDT believes it is necessary to put a 
requirement on how quickly changes to the scheme should be made. 
This requirement specifies that changes must be made within 18 
months of notification by the PC. The 18 month interval was chosen 
to give a reasonable amount of time for making changes in the field. 
All of the SERC region has existing UFLS schemes which, based on 
periodic simulations, have provided reliable protection for years. 
Events which result in islanding and an activation of the UFLS 
schemes are extremely rare. Therefore, the SDT does not believe that 
changes to an existing UFLS scheme will be needed in less than 18 
months. However, if a PC desires that changes to the UFLS scheme be 
made faster than that, then the PC may request the implementation to 
be done sooner than 18 months. The UFLS entity may oblige but will 
not be required to do so.\17\
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    \17\ NERC Petition, Exhibit A at 14 (emphasis added).

    15. The Commission reads the requirement that UFLS entities 
implement a change ``within 18-months'' to establish a ``maximum'' 
timeframe to comply with a planning coordinator's schedule to implement 
changes to UFLS schemes, but also to recognize that the planning 
coordinator could establish a schedule for the changes to be 
implemented in less time.\18\ The inclusion of a maximum timeframe 
would be more stringent than Reliability Standard PRC-006-1, 
Requirement R9, which does not contain a maximum timeframe to implement 
changes to a UFLS scheme.
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    \18\ In the VSL and VRF analysis in Exhibit E of NERC's 
Petition, NERC states that Requirement R6 specifies the maximum time 
for a UFLS entity to complete implementation of a major change in a 
planning coordinator's UFLS scheme. See NERC Petition, Exhibit E at 
16 (``[Requirement R6] specifies the maximum time for a UFLS entity 
to complete implementation of a major change in a Planning 
Coordinator's UFLS scheme.'').
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    16. We are concerned, however, that the italicized language in the 
rationale NERC provides for Requirement R6 may be incompatible with 
Order No. 763. As explained above, we interpret Requirement R6 to mean 
that planning coordinators can establish schedules for requiring 
changes to UFLS schemes by applicable entities within an 18-month time 
frame from the time the entities are notified. Yet, the rationale for 
Requirement R6 could result in Requirement R6 being read to allow 
applicable entities not to adopt the planning coordinator's schedule if 
it is less than 18 months. The Commission is concerned that leaving it 
up to applicable entities to determine their schedules for changes 
under certain circumstances will cause confusion and result in a lack 
of consistency in the application of the regional Reliability Standard. 
Allowing each UFLS entity to choose its own timing could harm 
reliability or at least defeat the purpose of the planning 
coordinator's role.
    17. Our concern is rooted in the Commission's directive in Order 
No. 763 concerning PRC-006-1, which held that planning coordinators 
should be responsible for establishing schedules for the completion of 
corrective actions in response to UFLS events.\19\ In the Notice of 
Proposed Rulemaking for PRC-006-1, the Commission stated that 
Reliability Standard PRC-006-1 does not specify how soon after an event 
an entity would need to implement corrections in response to any 
deficiencies identified in an event assessment.\20\ NERC responded that 
the time that a UFLS entity has to

[[Page 43193]]

implement corrections will be established by the planning coordinator, 
as specified in Requirement R9 of PRC-006-1.\21\ In Order No. 763, the 
Commission accepted NERC's comments that Requirement R9 requires 
compliance with a schedule established by the planning coordinator, but 
the Commission stated that NERC's reading of Requirement R9 should be 
made clear in the Requirement itself and directed NERC to make that 
requirement explicit in future versions of the Reliability 
Standard.\22\
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    \19\ Order No. 763, 139 FERC ] 61,098 at P 48.
    \20\ Automatic Underfrequency Load Shedding and Load Shedding 
Plans Reliability Standards, Notice of Proposed Rulemaking, 76 FR 
66,220 (October 26, 2011), FERC Stats. & Regs. ] 32,682 (2011).
    \21\ NERC stated:
    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.
    Order No. 763, 139 FERC ] 61,098 at P 48 (citing NERC Comments 
at 8).
    \22\ Order No. 763, 139 FERC ] 61,098 at P 48.
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    18. NERC states that PRC-006-SERC-01 is designed to work in 
conjunction with Reliability Standard PRC-006-1.\23\ NERC also 
maintains that the regional Reliability Standard is more stringent than 
PRC-006-1.\24\ Construing Requirement R6 as imposing a maximum time to 
comply with a planning coordinator's schedule, but leaving it up to the 
applicable entity to decide whether to take more time (up to 18 months) 
than the planning coordinator schedule allows, would be inconsistent 
with and, in certain cases, be less stringent than PRC-006-1. First, we 
are concerned that allowing applicable entities the flexibility to 
determine their own implementation schedule (up to 18 months) for 
changes rather than follow the schedule established by the planning 
coordinator is inconsistent with the policy underlying Order No. 763 
that planning coordinators establish schedules for completing changes 
to UFLS programs. If a planning coordinator believes that a change made 
pursuant to Requirement R6 should be completed in less than 18 months, 
the planning coordinator's schedule should be mandatory. Second, in 
certain circumstances, such an interpretation would be expressly 
prohibited by the Commission's directive in Order No. 763 concerning 
Requirement R9, which gives the planning coordinator the responsibility 
of setting a schedule for completing corrective actions to UFLS 
programs following event assessments pursuant to Requirement R11 and 
R12 of PRC-006-1. Although we acknowledge that changes made pursuant to 
Requirement R6 of the regional Reliability Standard will not always be 
corrective changes made in response to event assessments pursuant to 
the Requirements of PRC-006-1, Requirement R6 is broad enough to 
encompass corrective changes, thus creating a conflict between the 
regional Reliability Standard and PRC-006-1 under the proscribed 
interpretation. Thus, the Commission will not read Requirement R6 as 
providing a UFLS entity with the discretion not to follow the schedule 
set by the planning coordinator when the schedule is less than 18 
months.\25\
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    \23\ NERC Petition at 18-19.
    \24\ Id. at 18.
    \25\ In Order No. 693, the Commission explained that ``while 
Measures and Levels of Non-Compliance provide useful guidance to the 
industry, compliance will in all cases be measured by determining 
whether a party met or failed to meet the Requirement given the 
specific facts and circumstances of its use, ownership or operation 
of the Bulk-Power System.'' Order No. 693, 118 FERC ] 61,218 at P 
253. Similarly, in the immediate proceeding, we consider Requirement 
R6 the ``core obligation'' for purposes of determining compliance, 
while the related ``rationale statement'' is viewed as providing 
useful guidance but not setting compliance obligations. See also id. 
P 280 (``the Requirements in each Reliability Standard are core 
obligations'' and compliance Measures ``provide useful guidance * * 
*'').
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B. Violation Risk Factors and Violation Severity Levels

    19. NERC states that the VRFs and VSLs for the proposed regional 
Reliability Standard were developed and reviewed for consistency with 
NERC and Commission guidelines. After reviewing the assigned VRFs and 
VSLs for PRC-006-SERC-01 in Exhibit E, the Commission agrees, with one 
modification, that the proposed VRF and VSL assignments appear 
consistent with Commission guidelines. Therefore, the Commission 
proposes to approve, with one modification, the VRFs and VSLs assigned 
to the main Requirements in regional Reliability Standard PRC-006-SERC-
01.
    20. We propose to direct NERC to modify the VRF assigned to 
Requirement R6 from ``medium'' to ``high.'' In the petition, NERC 
states that Requirement R9 of PRC-006-1 and Requirement R6 address ``a 
similar reliability goal.'' \26\ However, NERC states that while 
Requirement R9 of PRC-006-1 addresses UFLS scheme implementation and 
has a VRF of ``high,'' Requirement R6 only addresses the timing of 
implementation and is, therefore, appropriately assigned a ``medium'' 
VRF.\27\ 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.'' \28\ As NERC notes, Requirement R6 and 
Requirement R9 of proposed PRC-006-1 address ``a similar reliability 
goal.'' While NERC explains in its filing that the specific topics 
addressed by each Requirement are different, the fact that they address 
a similar reliability goal suggests that they should be treated 
comparably and each given a ``high'' VRF, consistent with Guideline 3.
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    \26\ See NERC Petition, Exhibit E at 16.
    \27\ Id.
    \28\ North American Electric Reliability Corp., 119 FERC ] 
61,145, at P 25 (2007).
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    21. In addition, in Guideline 5 of the VRF Guidelines, the 
Commission indicated that, for Requirements with co-mingled reliability 
objectives, ``the Violation Risk Factor assignment for such 
Requirements is not watered down to reflect the lower risk level 
associated with the less important objective of the Reliability 
Standard.'' \29\ NERC states in the petition that Requirement R6 
combines the lesser risk reliability objective of establishing a 
maximum time frame for implementing changes to UFLS schemes with the 
higher risk reliability objective of actually implementing changes to 
UFLS schemes.\30\ As a result, consistent with Guideline 5, the 
Commission believes that proposed Requirement R6 should be assigned a 
``high'' VRF. We seek comment on this proposed directive.
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    \29\ Id. P 32.
    \30\ See NERC Petition, Exhibit E at 17.
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C. Implementation Plan and Effective Date

    22. NERC states that the implementation time for the proposed 
regional Reliability Standard is reasonable, as it balances the need 
for reliability with the practicability of implementation. The 
Commission proposes to accept the implementation plan and effective 
date proposed by NERC.

III. Information Collection Statement

    23. The Office of Management and Budget (OMB) regulations require 
that OMB approve certain reporting and recordkeeping (collections of 
information) imposed by an agency.\31\ 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

[[Page 43194]]

collections of information unless the collections of information 
display a valid OMB control number.
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    \31\ 5 CFR 1320.11.
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    24. The Commission is submitting these reporting and recordkeeping 
requirements to OMB for its review and approval under section 3507(d) 
of the PRA. Comments are solicited on the Commission's need for this 
information, whether the information will have practical utility, the 
accuracy of provided burden estimate, ways to enhance the quality, 
utility, and clarity of the information to be collected, and any 
suggested methods for minimizing the respondent's burden, including the 
use of automated information techniques.
    25. This Notice of Proposed Rulemaking proposes to approve regional 
Reliability Standard PRC-006-SERC-01. This is the first time NERC has 
requested Commission approval of this proposed regional Reliability 
Standard. NERC states in its petition that UFLS requirements had been 
in place at a continent-wide level and within SERC for many years prior 
to implementation of the Commission-approved Reliability Standards in 
2007. Because the UFLS requirements have been in place prior to the 
development of PRC-006-SERC-01, the proposed regional Reliability 
Standard is largely associated with requirements the applicable 
entities are already following.\32\ The proposed regional Reliability 
Standard, PRC-006-SERC-01, is designed to ensure that automatic UFLS 
protection schemes designed by planning coordinators and implemented by 
applicable distribution providers and transmission owners in the SERC 
Region are coordinated so they may effectively mitigate the 
consequences of an underfrequency event. The proposed regional 
Reliability Standard is only applicable to generator owners, planning 
coordinators, and UFLS entities in the SERC Region. The term ``UFLS 
entities'' means all entities that are responsible for the ownership, 
operation, or control of automatic UFLS equipment as required by the 
UFLS program established by the planning coordinators. Such entities 
may include distribution providers and transmission owners. The 
reporting requirements in proposed regional Reliability Standard PRC-
006-SERC-01 only pertain to entities within the SERC Region.
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    \32\ See 5 CFR 1320.3(b)(2) (``The time, effort, and financial 
resources necessary to comply with a collection of information that 
would be incurred by persons in the normal course of their 
activities (e.g., in compiling and maintaining business records) 
will be excluded from the `burden' if the agency demonstrates that 
the reporting, recordkeeping, or disclosure activities needed to 
comply are usual and customary.'').
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    26. Public Reporting Burden: Our estimate below regarding the 
number of respondents is based on the NERC compliance registry as of 
May 29, 2012. According to the NERC compliance registry, there are 21 
planning coordinators and 104 generator owners within the SERC Region. 
The individual burden estimates are based on the time needed for 
planning coordinators to incrementally gather data, run studies, and 
analyze study results to design or update the UFLS programs that are 
required in the regional Reliability Standard in addition to the 
requirements of the NERC Reliability Standard PRC-006-1.\33\ 
Additionally, generator owners must provide a detailed set of data and 
documentation to SERC within 30 days of a request to facilitate post 
event analysis of frequency disturbances. These burden estimates are 
consistent with estimates for similar tasks in other Commission-
approved Reliability Standards.
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    \33\ The burden estimates for Reliability Standard PRC-006-1 are 
included in Order No. 763 and are not repeated here.
    \34\ Proposed regional Reliability Standard PRC-006-SERC-01 
applies to planning coordinators, UFLS entities and generator 
owners. However, the burden associated with the UFLS entities is not 
new because it was accounted for under Commission-approved 
Reliability Standards PRC-006-1, PRC-007-0 and PRC-009-0.

----------------------------------------------------------------------------------------------------------------
                                                                                      Average      Total annual
 PRC-006-SERC-01 (Automatic underfrequency load      Number of       Number of     burden hours    burden hours
          shedding  requirements) \34\              respondents    responses per   per response     (1) x (2) x
                                                   annually (1)   respondent (2)        (3)             (3)
----------------------------------------------------------------------------------------------------------------
PCs*: Design and document Automatic UFLS Program              21               1               8             168
PCs: Provide Documentation and Data to SERC.....  ..............  ..............              16             336
GOs*: Provide Documentation and Data to SERC....             104               1              16           1,664
GOs: Record Retention...........................  ..............  ..............               4             416
                                                 ---------------------------------------------------------------
Total...........................................  ..............  ..............  ..............           2,584
----------------------------------------------------------------------------------------------------------------
* PC=planning coordinator; GO=generator owner.

    Total Annual Hours for Collection: (Compliance/Documentation) = 
2,584 hours.
    Total Reporting Cost for planning coordinators: = 504 hours @ $120/
hour = $60,480.
    Total Reporting Cost for generator owners: = 1,664 hours @ $120/
hour = $199,680.
    Total Record Retention Cost for generator owners: 416 hours @ $28/
hour = $11,647.
    Total Annual Cost (Reporting + Record Retention) \35\: = $60,480 + 
$199,680 +$11,648 = $271,808.
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    \35\ 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.
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    Title: Mandatory Reliability Standards for the SERC Region.
    Action: Proposed Collection FERC-725K.
    OMB Control No.: To be determined.
    Respondents: Businesses or other for-profit institutions; not-for-
profit institutions.
    Frequency of Responses: On Occasion.
    Necessity of the Information: This proposed rule proposes to 
approve the regional Reliability Standard pertaining to automatic 
underfrequency load shedding. The proposed regional Reliability 
Standard helps ensure the reliable operation of the Bulk-Power System 
by arresting declining frequency and assisting recovery of frequency 
following system events leading to frequency degradation.
    Internal Review: The Commission has reviewed the proposed regional 
Reliability Standard 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 SERC Region.
    27. Interested persons may obtain information on the reporting 
requirements by contacting the following: Federal Energy Regulatory 
Commission, 888 First Street NE.,

[[Page 43195]]

Washington, DC 20426 [Attention: Ellen Brown, Office of the Executive 
Director, email: DataClearance@ferc.gov, phone: (202) 502-8663, fax: 
(202) 273-0873].
    28. 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 RM12-09 and an OMB Control Number to be determined.

IV. Environmental Analysis

    29. 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.\36\ 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.\37\ The actions proposed here 
fall within this categorical exclusion in the Commission's regulations.
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    \36\ Order No. 486, Regulations Implementing the National 
Environmental Policy Act of 1969, FERC Stats. & Regs., Regulations 
Preambles 1986-1990 ] 30,783 (1987).
    \37\ 18 CFR 380.4(a)(2)(ii).
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V. Regulatory Flexibility Act Certification

    30. The Regulatory Flexibility Act of 1980 (RFA) \38\ 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.\39\ 
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.\40\
---------------------------------------------------------------------------

    \38\ 5 U.S.C. 601-612.
    \39\ 13 CFR 121.101.
    \40\ 13 CFR 121.201, Sector 22, Utilities & n.1.
---------------------------------------------------------------------------

    31. Proposed regional Reliability Standard PRC-006-SERC-01 proposes 
to establish consistent and coordinated requirements for the design, 
implementation, and analysis of automatic UFLS schemes among all 
applicable entities within the SERC Region. It will be applicable to 
planning coordinators, generator owners and entities that are 
responsible for the ownership, operation, or control of UFLS equipment. 
Comparison of the NERC Compliance Registry with data submitted to the 
Energy Information Administration on Form EIA-861 indicates that 
perhaps as many as 1 small entity is registered as a planning 
coordinator and 5 small entities are registered as generator owners in 
the SERC Region. The Commission estimates that the small planning 
coordinator to whom the proposed regional Reliability Standard will 
apply will incur compliance costs of $2,880 ($2,880 per planning 
coordinator) associated with the proposed regional Reliability 
Standard's requirements. The small generator owners will incur 
compliance and record keeping costs of $10,160 ($2,032 per generator 
owner). Accordingly, proposed regional Reliability Standard PRC-006-
SERC-01 should not impose a significant operating cost increase or 
decrease on the affected small entities.
    32. Further, NERC explains that the cost for smaller entities to 
implement regional Reliability Standard PRC-006-SERC-01 was considered 
during the development process. The Reliability Standard PRC-006-1 
requires a planning coordinator to identify which entities will 
participate in its UFLS scheme, including the number of steps and 
percent load that UFLS entities will shed. The standard drafting team 
recognized that UFLS entities with a load of less than 100 MW may have 
difficulty in implementing more than one UFLS step and in meeting a 
tight tolerance. Therefore, the standard drafting team included 
Requirement R5, which states that such small entities shall not be 
required to have more than one UFLS step, and sets their implementation 
tolerance to a wider level. Requirement R5 limits additional compliance 
costs for smaller entities to comply with the regional Reliability 
Standard.
    33. Based on this understanding, the Commission certifies that the 
regional Reliability Standard will not have a significant economic 
impact on a substantial number of small entities. Accordingly, no 
regulatory flexibility analysis is required.

VI. Comment Procedures

    34. The Commission invites interested persons to submit comments on 
the matters and issues proposed in this notice to be adopted, including 
any related matters or alternative proposals that commenters may wish 
to discuss. Comments are due September 24, 2012. Comments must refer to 
Docket No. RM12-9-000, and must include the commenter's name, the 
organization they represent, if applicable, and their address in their 
comments.
    35. The Commission encourages comments to be filed electronically 
via the eFiling link on the Commission's Web site at http://www.ferc.gov. The Commission accepts most standard word processing 
formats. Documents created electronically using word processing 
software should be filed in native applications or print-to-PDF format 
and not in a scanned format. Commenters filing electronically do not 
need to make a paper filing.
    36. Commenters that are not able to file comments electronically 
must send an original of their comments to: Federal Energy Regulatory 
Commission, Secretary of the Commission, 888 First Street NE., 
Washington, DC 20426.
    37. All comments will be placed in the Commission's public files 
and may be viewed, printed, or downloaded remotely as described in the 
Document Availability section below. Commenters on this proposal are 
not required to serve copies of their comments on other commenters.

VII. Document Availability

    38. 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 the Commission's Home Page (http://www.ferc.gov) and 
in the Commission'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.
    39. From the Commission'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 43196]]

    40. User assistance is available for eLibrary and the Commission's 
Web site during normal business hours from the Commission's 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.

By direction of the Commission.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2012-18009 Filed 7-23-12; 8:45 am]
BILLING CODE 6717-01-P


