[Federal Register Volume 65, Number 144 (Wednesday, July 26, 2000)]
[Proposed Rules]
[Pages 45938-45941]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-18500]



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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 35

[Docket No. RM00-10-000 ]


Open Access Same-Time Information System Phase II

Issued July 14, 2000.
AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Advance notice of proposed rulemaking (ANOPR).

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SUMMARY: The Federal Energy Regulatory Commission (Commission) requests 
the submission of detailed proposals, by February 15, 2001, that will 
enable the Commission to adopt by regulation certain communications 
protocols and standards for business practices to implement Open Access 
Same-Time Information System (OASIS) Phase II. OASIS Phase II will be 
more functional than the current OASIS Phase IA, will incorporate 
electronic scheduling and will apply to the communications and related 
business practices between customers and Transmission Providers, 
including Regional Transmission Organizations (RTOs).

DATES: Proposals are due on February 15, 2001.

ADDRESSES: Proposals should be filed with the Office of the Secretary 
and should refer to Docket No. RM00-10-000. Federal Energy Regulatory 
Commission, 888 First Street, NE., Washington, DC 20426.

FOR FURTHER INFORMATION CONTACT:
Marvin Rosenberg (Technical Information), Office of Markets, Tariffs 
and Rates, Federal Energy Regulatory Commission 888 First Street, NE., 
Washington, DC 20426, (202) 208-1283
Paul Robb (Technical Information), Office of Markets, Tariffs and 
Rates, Federal Energy Regulatory Commission, 888 First Street, NE., 
Washington, DC 20426, (202) 219-2702
Gary Cohen (Legal Information), Office of the General Counsel, Federal 
Energy Regulatory Commission, 888 First Street, NE., Washington, DC 
20426, (202) 208-0321

SUPPLEMENTARY INFORMATION:

Advance Notice of Proposed Rulemaking

    The Federal Energy Regulatory Commission (Commission) requests the 
submission of detailed proposals, by February 15, 2001, that will 
enable the Commission to adopt by regulation certain communications 
protocols and standards for business practices to implement Open Access 
Same-Time Information System (OASIS) Phase II. OASIS Phase II will be 
more functional than the current OASIS Phase IA, will incorporate 
electronic scheduling and will apply to the communications and related 
business practices between customers and Transmission Providers.\1\
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    \1\ For ease in reference, we use the term Transmission Provider 
as a shorthand for all public utilities that own and/or control 
facilities used for the transmission of electric energy in 
interstate commerce. This definition also encompasses Independent 
System Operators and Regional Transmission Organizations.
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I. Background

    In Order No. 889,\2\ the Commission began the process of 
standardizing electronic communication in the electric industry by 
requiring public utilities that own, control, or operate facilities 
used for the transmission of electric energy in interstate commerce to 
create or participate in an Internet-based information system called 
OASIS. The rules established in Order No. 889 were for a basic (Phase 
I) OASIS. OASIS Phase I became operational on January 3, 1997. Order 
No. 889 also contemplated that an enhanced (Phase II) OASIS would be 
later established.\3\ In March 1997, the Commission issued Order No. 
889-A that required on-line negotiations for discounts as well as the 
posting of discounts on the OASIS. In June 1998 \4\ and September 1998 
\5\ we adopted comprehensive updates of the OASIS and Standards and 
Communications Protocols Document (Phase IA SC&P) that implemented on-
line negotiations as well as other improvements suggested by the 
industry for OASIS. The Phase IA rules became operational on March 1, 
1999 and improved the operations of the basic Phase I OASIS as an 
interim step toward the development of the enhanced OASIS Phase II.\6\
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    \2\ Open Access Same-Time Information System (Formerly Real-Time 
Information Networks) and Standards of Conduct, Order No. 889, FERC 
Stats. & Regs. para. 31,035 at 31,583 (1996), order on reh'g, Order 
No. 889-A, FERC Stats. & Regs. para. 31,049 (1997), order on reh'g, 
Order No. 889-B, 81 FERC para. 61,253 (1997).
    \3\ We explained that the inclusion of scheduling as part of the 
OASIS requirements would be addressed in OASIS Phase II.
    \4\ Open Access Same-Time Information System and Standards of 
Conduct, 83 FERC para. 61,360 at 62,452 (1998) (June 18 Order).
    \5\ Open Access Same-Time Information System and Standards of 
Conduct, 84 FERC para. 61,329 (1998).
    \6\ OASIS ``Phase IA'' is a label devised by the industry to 
refer to revisions to the OASIS Phase I requirements that 
implemented the on-line negotiation of discounts. See Open Access 
Same-Time Information System and Standards of Conduct, 83 FERC para. 
61,360 at 62,452 (1998).
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    In Order No. 889 the Commission requested the industry to file a 
consensus report proposing standards for OASIS Phase II.\7\ On November 
3, 1997, the Commercial Practices Working Group (CPWG) \8\ and the 
OASIS How Group (How Group) filed a report entitled ``Industry Report 
to the Federal Energy Regulatory Commission on the Future of OASIS'' 
(Industry Report). The Industry Report did not propose standards for 
Phase II but instead presented lessons learned from OASIS Phase I and 
posed several broad policy issues relating to the future scope and 
development of OASIS. In particular, the report raised the question of 
whether the standards to be developed should be regional or national in 
scope.
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    \7\ Order No. 889, FERC Stats. & Regs. para. 31,035 at 31,627 
(1996) .
    \8\ The CPWG is no longer functioning. Its activities have been 
taken over by a successor industry group, the Market Interface 
Committee (MIC).
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    On June 19, 1998, the CPWG and the How Group filed a report 
entitled ``Industry Report to the Federal Energy Regulatory Commission 
on OASIS Phase IA Business Practices'' (June 19 Report) offering a set 
of uniform business practice standards and guidelines for adoption by 
the Commission. The June 19 Report argued that, because many OASIS-
related business practice implementation details were left for 
transmission providers to determine for themselves, significant 
variation arose among business practices across OASIS nodes. To reduce 
this variation and to promote greater consistency in the implementation 
of the Commission's open access policy and OASIS policy, the CPWG/How 
Group proposed that the Commission adopt its recommended ``Phase IA 
Business Practice Standards and Guides'' (Business Practices). On 
February 25, 2000, in Order No. 638, the Commission adopted the 
proposed Business Practices.\9\ On December 20, 1999, the Commission 
issued a Final Rule (Order No. 2000) to advance the formation of 
Regional Transmission Organizations (RTOs).\10\ Order No. 2000, among 
other things, established

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minimum characteristics and functions that an RTO must satisfy.
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    \9\ Open Access Same-Time Information System and Standards of 
Conduct, Order No. 638, 90 FERC para. 61,202 (2000).
    \10\ Regional Transmission Organizations, Order No. 2000, 65 FR 
809 (January 6, 2000), FERC Stats. & Regs. para. 31,089 (2000), 
order on reh'g, Order No. 2000-A, 65 FR 12,088 (March 8, 2000), FERC 
Stats. & Regs. para. 31,092 (2000), petitions for review pending sub 
nom., Public Utility District No. 1 of Snohomish County, Washington 
v. FERC, Nos. 00-1174, et al.
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    In Order No. 2000, we stated:

    How Group and other commenters address issues relating to the 
standardization of transmission transactions. Standardization of 
transactions involves two separate concerns: (1) Many transactions 
will cross RTO boundaries; and (2) numerous customers will do 
business with multiple RTOs. Without standardized communications 
protocols and business practices, the costs of doing business will 
be increased as market participants will be required to install 
additional software and add personnel to transact with different 
RTOs and regions. Therefore, to promote interregional trade, 
standardized methods of moving power into, out of, and across RTO 
territories will be needed.
    We believe that standards for communications between customers 
and RTOs must be developed to permit customers to acquire 
expeditiously common services among RTOs. For example, we envision 
the creation of standardized communications protocols to schedule 
power movements and to acquire auction rights. These protocols would 
not standardize what the rights are, or the nature of the auctions. 
Instead, the focus of the communications protocols would be on how 
customers communicate their intentions to an RTO and how customers 
receive an RTO's responses.
    We agree with How Group and others that certain business and 
communication standards are necessary, and we believe that these 
standards will facilitate the development of efficient markets. We 
believe, however, that these issues need further examination based 
on a complete record.\11\
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    \11\ Order No. 2000, FERC Stats. & Regs. para. 31,089 at 31,145 
(2000) (footnote omitted).

II. Discussion

    In Orders Nos. 888 and 889, the Commission established OASIS for 
two purposes: (1) To help mitigate transmission market power by 
providing non-discriminatory access to transmission information and 
services; and (2) to promote the development of competitive markets for 
power by setting national standards for the reservation of transmission 
capacity. Our objective of promoting the development of uniform 
standards to support competitive markets for power still remains. In 
the four years since Order Nos. 888 and 889 were issued, the Commission 
has found that transmission market power could be mitigated more 
effectively by RTOs. We also found that RTOs would promote more 
efficient grid management and reliability needed for competitive 
electricity markets. Thus, OASIS changes may be needed to promote and 
complement the development of RTOs.
    Any revised standards, like the current OASIS standards, will apply 
to each public utility that owns and/or controls facilities used for 
the transmission of electric energy in interstate commerce, including 
RTOs. We also stated in Order No. 2000 that ``an RTO must be the single 
OASIS site administrator for all transmission facilities under its 
control.'' \12\ The RTO's function as a single OASIS site administrator 
will help to ensure standardization within each RTO; however, customers 
will also obtain transmission service across multiple RTOs and 
compatibility among RTOs with respect to transmission information and 
transaction requirements is essential. Efficient wholesale power 
markets require that communication protocols not raise barriers to the 
ability of parties to make trades in a timely manner. Such impediments 
should be eliminated, or, at a minimum, reduced to the maximum extent 
possible. Order No. 2000 recognized this, not only by establishing 
OASIS as a separate function of an RTO, but also by establishing 
interregional coordination as one of the functions for an RTO.
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    \12\ Order No. 2000, FERC Stats. & Regs. para. 31,089 at 31,144 
(2000). Furthermore, we concluded in Order No. 2000 that an RTO has 
the flexibility to contract out OASIS responsibilities to another 
independent entity or participate in a ``super-OASIS'' jointly with 
other RTOs. See id. at 31,145.
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    We also intend to facilitate communication between customers and 
Transmission Providers for services and critical market information, 
e.g., auctions for transmission rights, the posting of available 
transmission capacity (ATC), total transmission capacity (TTC) and 
capacity benefit margin (CBM), prices for transmission and ancillary 
services, information on curtailments and interruptions and 
transmission facility status.
    The Commission is soliciting proposals, to be filed by February 15, 
2001, containing detailed, standard communication protocols and 
associated business practices that all Transmission Providers and 
customers would use in reserving and scheduling power, and to reserve 
and schedule transmission to accommodate power flows into, out of, and 
across RTOs. The Commission intends to review the proposals received in 
response to the ANOPR and issue a Notice of Proposed Rulemaking (NOPR) 
or take other appropriate action.
    We continue to believe that the communications standards and 
protocols of OASIS Phase II, like the current OASIS Phase IA, shall 
make use of: (1) The Internet for communications; (2) interactive 
displays using World Wide Web browsers; \13\ (3) file uploads and 
downloads for computer-to-computer communication; and (4) templates 
defining the file uploads and downloads. In addition, submitted 
proposals should address what modifications to the existing OASIS 
Standards and Communications Protocols and related business practices 
\14\ are necessary to implement OASIS Phase II.
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    \13\ In the past we have not required standardization of WWW 
displays. However, in developing proposals, the industry should 
consider any need for a ``common look and feel'' for displays.
    \14\ Order No. 638, FERC Stats. & Regs. para. 31,093 at 31,402 
(2000).
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    In various OASIS-related orders, we postponed adding certain 
functionality to OASIS until Phase II. The most pressing of these is 
electronic scheduling.\15\ In addition, other functionality was 
incorporated as OASIS developed (such as a modified form of dynamic 
notification \16\ and formats for electronic submission of tariffs 
\17\) and other functionality was no longer needed because OASIS, the 
market or technology developed in a different direction (e.g., breaking 
large files into 100,000 byte segments \18\). The proposals should 
discuss whether the additional functionality of complete dynamic 
notification should be integrated in OASIS Phase II, and, furthermore, 
the industry should consider whether generator-run status information 
should be incorporated into OASIS Phase II.
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    \15\ See Order No. 889, FERC Stats. & Regs. para. 31,035 at 
31,594 and 31,628 (1996); June 18 Order at 62,451; Open Access Same-
time Information System and Standards of Conduct, 84 FERC para. 
61,324 at 62,455 (1998).
    \16\ See June 18 Order at 62,463-64. Dynamic notification occurs 
when an OASIS node automatically (without a re-query by a customer) 
notifies a customer of information changes such as the current ATC 
for a given path or the status of a pending service request.
    \17\ See Order No. 889-A, FERC Stats. & Regs. para. 31,049 at 
30,575 (1997).
    \18\ Order No. 889, FERC Stats. & Regs. para. 31,035 at 31,625 
(1996).
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    Also, our experience with OASIS Phase I has taught us that business 
practices standards, in addition to communication standards and 
protocols are needed for the development of efficient markets and for 
the efficient use of the transmission grid. Accordingly, submitted 
proposals should identify any business practices that need to be 
standardized.
    The Commission's experience with Order No. 889 and Order No. 636 
has taught us that industry standards, when needed, should be 
established as early as possible. Our goal is to identify 
standardization issues before entities

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invest extensive capital in a system. We intend, therefore, to have 
OASIS Phase II operational by December 15, 2001 (the RTO startup date). 
In this way, we hope to avoid unnecessary expenditures by the industry.

Timetable and Other Information

    The Commission expects the proposals to be sufficiently detailed so 
they may be included in a NOPR. The comments and proposals submitted on 
February 15, 2001, should also propose an implementation schedule or 
plan to transition from OASIS Phase IA to OASIS Phase II, including 
time for testing, to allow the standards to be fully implemented by 
December 15, 2001.
    The Commission urges representatives of the various segments of the 
industry to work together to achieve a consensus on these proposals. 
The Commission's earlier efforts in this area benefitted greatly from 
the input of a number of industry working groups. The Commission 
continues to believe that the industry should take the lead in 
developing and implementing standards that will be both practical and 
workable for the variety of business transactions that will take place. 
Commission staff intends to consult and participate in this process. 
The Commission will give proposals developed through a collaborative 
industry process considerable weight. However, collaborative input can 
only be considered if it is provided to us in a timely manner so that 
we may adhere to the timetables set forth here.

III. Document Availability

    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.fed.us) and in 
FERC's Public Reference Room during normal business hours (8:30 a.m. to 
5 p.m. Eastern time) at 888 First Street, NE., Room 2A, Washington, DC 
20426.
    From FERC's Home Page on the Internet, this information is 
available in both the Commission Issuance Posting System (CIPS) and the 
Records and Information Management System (RIMS).
     CIPS provides access to the texts of formal documents 
issued by the Commission since November 14, 1994. CIPS can be accessed 
using the CIPS link or the Energy Information Online icon. The full 
text of this document will be available on CIPS in ASCII and 
WordPerfect 8.0 format for viewing, printing, and/or downloading.
     RIMS contains images of documents submitted to and issues 
by the Commission after November 16, 1981. Documents from November 1995 
to the present can be viewed and printed from FERC's Home Page using 
the RIMS link or the Energy Information Online icon. Descriptions of 
documents back to November 16, 1981, are also available from RIMS-on-
the-Web; requests for copies of these and other older documents should 
be submitted to the Public Reference Room.
    User assistance is available for RIMS, CIPS, and the Website during 
normal business hours from our Help line at (202) 208-2222 (e-mail to 
[email protected]) of the Public Reference Room at (202) 208-1371 
(e-mail to [email protected]).
    During normal business hours, documents can also be viewed and/or 
printed in FERC's Public Reference Room, where RIMS, CIPS, and the FERC 
Website are available. User assistance is also available.
    By direction of the Commission. Commissioner Hebert concurred with 
a separate statement attached.

Linwood A. Watson, Jr.,
Acting Secretary.

HeBERT, Commissioner concurring:
    The Commission today issues an Advance Notice of Proposed 
Rulemaking on standards for electronic communications among 
participants in the transmission market. The document solicits detailed 
proposals by February 2001, with the goal for the system to operate by 
December 15 of that year. Some may consider this a major step forward 
in the development of competitive markets. If I viewed this rulemaking 
in isolation from Order No. 2000 and the collaborative process that we 
and the industry have undertaken to form Regional Transmission 
Organizations (RTO's), I would agree. Looking at the big picture, 
however, I consider our action today unnecessary, at best, and, at 
worst, a potential distraction from the more important job of reaching 
the goal we all endorse: competition through a viable stand-alone 
transmission business.
    I consider a rulemaking at this juncture a waste of time because 
Order No. 2000 already covered this ground . In particular, Section 
35.34(k)(5) makes the RTO the OASIS administrator within the 
organizations's boundaries. In addition, section 35.34(k)(8) describes 
interregional coordination as ``ensur[ing] the integration of 
reliability practices within an interconnection and market practices 
among regions.'' (Emphasis added). The section in the Preamble on 
interregional coordination explains, ``The integration of market 
interface practices involves developing some level of standardization 
of inter-regional market standards, including the co-ordination of * * 
* transmission reservation practices, * * * as well as other market 
coordination requirements covered elsewhere in the Final Rule.'' Order 
No. 2000, mimeo at 497.
    Since all regulated transmission owners are participating in the 
process of forming RTO's, the industry is already engaged in the 
process we seek to start today. Transco's especially need to ensure 
proper communications, for reservations and scheduling, or they cannot 
establish a viable transmission business. In addition, entrepreneurs 
are engaged now in trying to improve, or supplant, OASIS, a system that 
all admit uses obsolete technology. I fail to see why we need to do 
anything drastic, such as issuing a new rule on one aspect of what we 
covered in Order No. 2000. In that regard, I point out that the order 
states that we may take ``other appropriate action,'' not necessarily 
issuing a Notice of Proposed Rulemaking. Mimeo at 7.
    I consider a rulemaking a potential distraction because of the 
timetables the Commission imposes. Order No. 2000 recognized that 
electronic communication with organizations that may not exist presents 
a problem. Therefore, we stated that, instead of an implementation 
schedule, the RTO filings should ``provide a schedule for * * * follow-
up details on how [the RTO] is meeting the coordination requirements.* 
* *'' Order No. 2000, Mimeo at 494-95. In contrast, we solicit 
``detailed'' proposals (mimeo at 7) by February 15, 2001, and hope to 
have the system operate concurrently with the commencement of RTO's. 
With tight timetables, parties may divert their attention from the more 
important issues of scope and pricing, to the subsidiary one of 
information technology.
    The timetables have another, opposite drawback: stifling 
innovation. If the industry thinks that we might impose new 
requirements by December 15, 2001, inventors who may have innovations 
ready sooner will stop dead in their tracks. The market, the 
transmission owners and their customers, will loath to spend money if, 
in the end, FERC will not approve of the results. At least in the Order 
No. 2000, we allowed the parties to adopt whatever works. Rather than 
making OASIS an end in itself, as we seem to today, we make it a means 
toward the

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goal of an efficient transmission business.
    I would keep my eye on the destination. I urge the comments on this 
advance notice to discuss these issues, lest we lose the forest for 
some trees.
    I concur.


Curt L. Hebert, Jr.,
Commissioner.
[FR Doc. 00-18500 Filed 7-25-00; 8:45 am]
BILLING CODE 6717-01-P