FERC takes prompt action in response to blackout task force recommendations

The Federal Energy Regulatory Commission has responded quickly to recommendations issued last week by the US-Canada Power System Outage Task Force with an order clarifying the Commission's power grid reliability policies and objectives.

In a related order, the Commission directed transmission-operating utilities to report on vegetation management practices in transmission corridors. The task force report found that tree contact with transmission lines was a precipitating factor in last year's regional blackout.

The Commission's policy statement on power system reliability addresses the need to expeditiously modify the North American Electric Reliability Council's (NERC) reliability standards in order to make these standards clear and enforceable.

The Commission emphasises public utility compliance with reliability standards, stating that Good Utility Practice includes compliance with these standards. The policy states that the Commission, consistent with its authority, will consider taking utility-specific action on a case-by-case basis to address significant reliability problems or compliance with Good Utility Practice. The policy statement also addresses recovery of prudent reliability costs, and the need for communication and cooperation between the Commission and the states, as well as with Canada and Mexico.

"I made clear after the power failure last year that FERC will do all that it can under the Federal Power Act to ensure a safe and reliable electric power system for this nation. However, I cannot emphasise enough that we need legislative reform that provides a clear federal framework for developing and enforcing mandatory reliability rules," said Chairman Pat Wood, III. "In the interim, we will immediately take the steps we can within our statutory jurisdiction to ensure reliability. The nation's electricity customers deserve nothing less."

On August 14, 2003, an electric power blackout affected large portions of the Northeast and Midwest United States and Ontario, Canada. The following day, a US-Canada Power System Outage Task Force was established to investigate the causes of the blackout and recommend measures to reduce the possibility of future outages.

The Final Report, issued April 5th, identified four categories of causes:
(1) inadequate system understanding;
(2) inadequate situational awareness;
(3) inadequate tree trimming; and
(4) inadequate reliability coordinator diagnostic support.

The Final Report found that several entities violated NERC operating policies and planning standards, directly contributing to the blackout. However, the report also found that many of NERC's policies are unclear and ambiguous.

In response to recommendations made in the final report, the Commission's policy statement immediately takes the following steps:
* No new ISO or RTO will be allowed to begin operations until its reliability capabilities are functional.
* The Commission will consider the reliability implications of its decisions, as appropriate.
* The Commission is appointing a staff task force to report on potential funding mechanisms for NERC and the regional reliability councils to ensure their independence from the utilities they monitor. The staff task force will work closely with FERC's Canadian counterparts, state regulatory authorities, NERC, regional reliability councils and the industry.
* FERC staff are directed to draft a memorandum of understanding (MOU) defining NERC's working relationship with the Commission. The MOU will clarify the Commission's appropriate role in NERC oversight and the respective reliability responsibilities of both NERC and the Commission.

The Commission's policy statement emphasised that it supports NERC and the industry in their efforts to make reliability standards clearer and more enforceable. Priority matters identified in the Blackout Report that need to be addressed in the NERC standards include, among other things, issues such as vegetation management on transmission rights-of-way, operator training and adequacy of operator tools.

However, the Commission said, NERC reliability standards should represent a floor for grid operators and bulk system participants, not a ceiling. If there are any regional variations in the NERC reliability standards, the Commission said, they should be no less stringent than, and not inconsistent with, the NERC reliability standards.

Source: Federal Energy Regulatory Commission

•Date: 20th April 2004 •Region: N.America •Type: Article •Topic: Power management
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