US FERC Issues 2 Proposed Rules to Address Grid Reliability in Extreme Weather Conditions
On June 16, 2022, the United States Federal Energy Regulatory Commission (“FERC” or “Commission”) issued two proposed rules intended to improve the reliability of the bulk-power transmission system (Bulk-Power System) against the threats of extreme weather.
In the first rulemaking (Informational Report NOPR), FERC, acting under section 304 of the Federal Power Act, would direct transmission providers to submit one-time informational reports describing their current or planned policies and processes for conducting extreme weather vulnerability assessments and mitigating identified extreme weather risks.
The Informational Report NOPR proposes to define an extreme weather vulnerability assessment as any analysis that identifies where and under what conditions jurisdictional transmission assets and operations are at risk from the impacts of extreme weather events, how those risks will manifest themselves, and what the consequences will be for transmission system operations.
The Informational Report NOPR further proposes to require transmission providers to include in their one-time informational reports information describing how they (1) establish a scope for their extreme weather vulnerability assessments, (2) develop inputs, (3) identify vulnerabilities and determine exposure to extreme weather hazards, (4) estimate the costs of impacts, and (5) develop mitigation measures to address extreme weather risks.
The Informational Report NOPR just seeks information and does not require transmission providers to undertake vulnerability assessments where they do not already do so.
In the second rulemaking (NERC Planning NOPR), FERC proposes, pursuant to section 215(d)(5) of the Federal Power Act, to direct the North American Electric Reliability Corporation (NERC) to develop and submit for Commission approval modifications to existing NERC Reliability Standard TPL-001-5.1 (Transmission System Planning Performance Requirements)1 to address transmission system planning for extreme heat or cold weather events that impact the reliable operation of the Bulk-Power System.
FERC states that the NERC Planning NOPR focuses on Reliability Standard TPL-001 because this standard establishes transmission system planning performance requirements to ensure the reliable operation of the Bulk-Power System over a broad spectrum of system conditions and following a wide range of probable contingencies, including extreme events based on operating experience.
However, while TPL-001 references studies for “extreme events,” it does not specifically require performance analysis for extreme heat and cold weather conditions that affect wide geographical areas simultaneously over several days. In addition, while the standard requires responsible entities (i.e., planning coordinator and transmission planner) to evaluate possible actions to reduce the likelihood or mitigate the consequences of extreme events, these entities are not obligated to develop and implement corrective actions. To address this reliability gap in Bulk-Power System planning, the NERC Planning NOPR would direct NERC to develop modifications to Reliability Standard TPL-001-5.1 to require responsible entities to:
- Develop benchmark planning cases based on information such as major prior extreme heat and cold weather events or future meteorological projections;
- Plan for extreme heat and cold events using steady state and transient stability analyses expanded to cover a range of extreme weather scenarios, including the expected resource mix’s availability during extreme heat and cold weather conditions, and include the broad area impacts of extreme heat and cold weather; and
- Develop in advance a corrective action plan that includes mitigation for any instances where performance requirements for extreme heat and cold events are not met.
In addition to comments on extreme heat and cold weather events, the NERC Planning NOPR also seeks comment on whether drought conditions should be included in the scope of Reliability Standard TPL-001 so that it could be modeled in the future to improve system performance during such events.
The Informational Report NOPR and NERC Planning NOPR follow—by well over a year—Texas’s adoption of state-level reporting and resiliency requirements. Those requirements are discussed in our previous Legal Updates.2
Comments on each NOPR are due within 60 days of Federal Register publication.
1 The modification to NERC Standard TPL-001-5.1 is expected to govern only those NERC-regulated entities that are in the “Transmission Provider” class and not other NERC classes of Bulk-Power System entities.
2 See our December 8, 2021, Legal Update “Making the Grid More Climate-Resilient: Report on February 2021 Cold Weather Outages in Texas and South Central US Highlights the Challenges” and our August 30, 2021, Legal Update “Texas Commission Proposes New Generator, Utility Weather Requirements and Opens Fast-Track Rulemaking Proceeding.”
