[Federal Register Volume 78, Number 61 (Friday, March 29, 2013)]
[Proposed Rules]
[Pages 19152-19155]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-07114]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 40

[Docket No. RM12-19-000]


Revisions to Modeling, Data, and Analysis Reliability Standard

AGENCY: Federal Energy Regulatory Commission, DOE.

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 
Reliability Standard MOD-028-2, submitted to the Commission for 
approval by the North American Electric Reliability Corporation (NERC), 
the Commission-certified Electric Reliability Organization. NERC 
proposes one modification to the currently-effective Reliability 
Standard MOD-028-1, pertaining to the information a transmission 
service provider must include when calculating Total Transfer 
Capability using the area interchange methodology for the on-peak and 
off-peak intra-day and next day time periods. The Commission also 
proposes to approve NERC's proposed implementation plan and retirement 
of the currently-effective standard.

DATES: Comments are due May 13, 2013.

ADDRESSES: You may submit comments, identified by docket number by any 
of the following methods:
     Agency Web site: http://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.

FOR FURTHER INFORMATION CONTACT: 
Rachel Bryant (Legal Information), Office of General Counsel, Federal 
Energy Regulatory Commission, 888 First Street NE., Washington, DC 
20426, 202-502-6155, [email protected].
Syed Ahmad (Technical Information), Office of Electric Reliability, 
Federal Energy Regulatory Commission, 888 First Street NE., Washington, 
DC 20426, 202-502-8718, [email protected].
Christopher Young (Technical Information), Office of Energy of Energy 
Policy and Innovation, Federal Energy Regulatory Commission, 888 First 
Street NE., Washington, DC 20426, 202-502-6403, 
[email protected].

SUPPLEMENTARY INFORMATION: 

Notice of Proposed Rulemaking

Table of Contents


 
                                                             Paragraph
                                                              numbers
 
I. Background...........................................               2
II. NERC Petition.......................................               7
III. Discussion.........................................              10
IV. Information Collection Statement....................              14
V. Environmental Analysis...............................              16
VI. Regulatory Flexibility Act Analysis.................              17
VII. Comment Procedures.................................              18
VIII. Document Availability.............................              22
 


Issued March 21, 2013

    1. Pursuant to section 215 of the Federal Power Act (FPA),\1\ the 
Commission proposes to approve Modeling, Data, and Analysis (MOD) 
Reliability Standard MOD-028-2, submitted to the Commission for 
approval by the North American Electric Reliability Corporation (NERC), 
the Commission-certified Electric Reliability Organization (ERO). NERC 
proposes one modification to the currently-effective Reliability 
Standard MOD-028-1, pertaining to the information a transmission 
service provider \2\ must include when calculating Total Transfer 
Capability (TTC) using the area interchange methodology for the on-peak 
and off-peak intra-day and next day time periods. The Commission also 
proposes to approve NERC's proposed implementation plan and retirement 
of the currently-effective standard.
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    \1\ 16 U.S.C. 824o (2006).
    \2\ NERC defines ``transmission service provider'' as ``[t]he 
entity that administers the transmission tariff and provides 
Transmission Service to Transmission Customers under applicable 
transmission service agreements.'' NERC, Glossary of Terms Used in 
NERC Reliability Standards 64 (2011), http://www.nerc.com/files/Glossary_of_Terms.pdf. We also use the term ``transmission 
operator'' in this proposed rulemaking, which is defined by NERC as 
``[t]he entity responsible for the reliability of its `local' 
transmission system, and that operates or directs the operations of 
the transmission facilities.'' Id. These terms indicate distinct 
NERC functional entities, to which different requirements within the 
same Reliability Standard may apply. Accordingly, in the context of 
describing the requirement of a Reliability Standard, we necessarily 
use either or both terms when appropriate.
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I. Background

    2. Section 215 of the FPA requires a Commission-certified ERO to 
develop mandatory and enforceable Reliability Standards, subject to 
Commission review and approval. Specifically, the Commission may 
approve, by rule or order, a proposed Reliability Standard or 
modification to a Reliability Standard if it determines that the 
Standard is just, reasonable, not unduly discriminatory or 
preferential, and in the public interest.\3\ Once approved, the 
Reliability Standards may be enforced by the ERO, subject to Commission 
oversight, or by the Commission independently.\4\ Pursuant to section 
215 of the FPA, the Commission established a process to

[[Page 19153]]

select and certify an ERO,\5\ and subsequently certified NERC.\6\
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    \3\ 16 U.S.C. 824o(d)(2).
    \4\ Id. 824o(e)(3).
    \5\ 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).
    \6\ North American Electric Reliability Corp., 116 FERC ] 
61,062, order on reh'g & compliance, 117 FERC ] 61,126 (2006), aff'd 
sub nom. Alcoa, Inc. v. FERC, 564 F.3d 1342 (D.C. Cir. 2009).
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    3. In March 2007, the Commission issued Order No. 693, evaluating 
107 Reliability Standards, including 23 MOD standards pertaining to 
methodologies for calculating Available Transfer Capability (ATC) and 
Available Flowgate Capability (AFC).\7\ The Commission approved one out 
of the 23 MOD standards unconditionally, approved nine with direction 
for modification and left the remaining 13 pending with direction for 
modification.\8\
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    \7\ Mandatory Reliability Standards for the Bulk-Power System, 
Order No. 693, FERC Stats. & Regs. ] 31,242 at P 1046, order on 
reh'g, Order No. 693-A, 120 FERC ] 61,053 (2007). See also 
Preventing Undue Discrimination and Preference in Transmission 
Service, Order No. 890, FERC Stats. & Regs. ] 31,241, order on 
reh'g, Order No. 890-A, FERC Stats. & Regs. ] 31,261 (2007), order 
on reh'g, Order No. 890-B, 123 FERC ] 61,299 (2008), order on reh'g, 
Order No. 890-C, 126 FERC ] 61,228 (2009), order of clarification, 
Order No. 890-D, 129 FERC ] 61,129 (2009) (directing public 
utilities to develop Reliability Standards and business practices to 
improve the consistency and transparency of ATC calculations).
    \8\ Order No. 693, FERC Stats. & Regs. ] 31,242 at P 1010.
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    4. On November 24, 2009, the Commission issued Order No. 729,\9\ 
which approved Available Transmission System Capability Reliability 
Standard MOD-001-1 as part of a set of Reliability Standards that 
pertain to methodologies for the consistent and transparent calculation 
of ATC and AFC. These Reliability Standards were designed to ensure, 
among other things, that transmission service providers maintain 
awareness of available system capability and future flows on their own 
systems, as well as those of their neighbors, and to reduce 
transmission service provider discretion and enhance transparency in 
the calculation of ATC.\10\ Requirement R1 of MOD-001-1 required a 
transmission operator to select one of three methodologies for 
calculation of ATC or AFC for each available ATC path for each time 
frame (hourly, daily or monthly). NERC developed these three 
methodologies as detailed in Reliability Standards MOD-028-1 (the area 
interchange methodology), MOD-029-1a (the rated system path 
methodology), and MOD-030-2 (the flowgate methodology).\11\
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    \9\ Mandatory Reliability Standards for the Calculation of 
Available Transfer Capability, Capacity Benefit Margins, 
Transmission Reliability Margins, Total Transfer Capability, and 
Existing Transmission Commitments and Mandatory Reliability 
Standards for the Bulk Power System, Order No. 729, 129 FERC ] 
61,155 (2009), order on clarification, Order No. 729-A, 131 FERC ] 
61,109, order on reh'g and reconsideration, Order No. 729-B, 132 
FERC ] 61,027 (2010).
    \10\ Order No. 729, 129 FERC ] 61,155 at PP 87-89.
    \11\ Id. P 51.
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    5. The MOD Reliability Standards related to this discussion require 
certain users, owners, and operators of the bulk power system to 
develop consistent and transparent methodologies for the calculation of 
ATC or AFC.\12\ Three currently-effective Reliability Standards--MOD-
028-1, MOD-029-1a, and MOD-030-2--address three different methodologies 
for calculating ATC or AFC.\13\ MOD-028-1, which describes the area 
interchange methodology for determining ATC, only applies to those 
transmission operators and transmission service providers that elect to 
implement this particular methodology as part of their reliability 
compliance with Reliability Standard MOD-001-1. MOD-001-1 requires 
transmission service providers to ``[adhere] to a specific documented 
and transparent methodology'' and ``to select one of three 
methodologies for calculating [ATC] or [AFC] for each available 
transfer capability path for each time frame (hourly, daily or monthly) 
for the facilities in its area.'' \14\
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    \12\ Id. P 1.
    \13\ Id. P 51.
    \14\ Id. P 19.
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    6. Requirement R3.1 of MOD-028-1 details the information a 
transmission operator must include in its TTC determination under the 
area interchange methodology for the on-peak and off-peak intra-day and 
next day time periods, as well as future days two through 31 and for 
months two through 13.\15\
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    \15\ Id. P 57 (stating that this information includes: expected 
generation and transmission outages, additions, and retirements; 
load forecasts; and unit commitment and dispatch order).
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II. NERC Petition

    7. On August 24, 2012, NERC submitted a Petition for Approval of 
Proposed Reliability Standard (Petition), seeking Commission approval 
of a proposed Reliability Standard, MOD-028-2, Area Interchange 
Methodology, Requirement R3.1, which would revise the currently 
effective ``Version 1'' standard--MOD-028-1.
    8. NERC states that Florida Power & Light Company (FPL) requested 
that NERC interpret MOD-028-1, Requirement R3.1. Specifically, FPL 
requested that NERC clarify whether Requirement R3.1, which instructs 
transmission operators to include data ``[f]or on peak and off peak 
intra-day and next day TTCs,'' actually requires transmission operators 
to provide separate TTC numbers for different portions of the current 
day. NERC explains that, upon reviewing FPL's request for 
interpretation, the NERC Standards Committee determined that providing 
this clarification might require a modification to the standard.\16\ In 
its Petition, NERC asserts that it intended the language of MOD-028-1 
to specify that, for TTC used in current-day and next-day ATC 
calculations, the load forecast used should be consistent with the 
period being calculated. Specifically, NERC states:
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    \16\ Petition, Exhibit E (Record of Development of Proposed 
Reliability Standard).

    Requirement R3 of the MOD-028-1 standard is proposed to be 
modified to clarify language regarding load forecasting, to indicate 
that for days two through 31, a daily load forecast is required 
(identical to the current standard); for months two through 13, a 
monthly load forecast is required (identical to the current 
standard); and for current-day and next-day, entities may use either 
a daily or hourly load forecast (the language being clarified). The 
new language clarifies and is consistent with the intent of the 
original requirement language, and does not materially change the 
standard.\17\
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    \17\ Petition at 7 (emphasis added).

    9. NERC thus proposes Reliability Standard MOD-028-2, which revises 
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MOD-028-1 as follows:

    R3. When calculating TTCs for ATC Paths, the Transmission 
Operator shall include the following data for the Transmission 
Service Provider's area * * *
    R3.1. For on peak and off peak intra day and next dayFor TTCs, 
use the following (as well as any other values and additional 
parameters as specified in the ATCID).
    R3.1.1. Expected generation and Transmission outages, additions, 
and retirements, included as specified in the ATCID.
    R.3.1.2. LoadA daily or hourly load forecast for the applicable 
period being calculatedTTCs used in current-day and next-day ATC 
calculations.
    R.3.1.3. A daily load forecast for TTCs used in ATC calculations 
for days two through 31.
    R.3.1.2.R3.1.4. A monthly load forecast for TTCs used in ATC 
calculations for months two through 13 months TTCs.

III. Discussion

    10. Pursuant to section 215(d) of the FPA, we propose to approve 
NERC's proposed Reliability Standard MOD-028-2, as just, reasonable, 
not unduly discriminatory or preferential and in the public interest. 
We agree with NERC that the proposed Reliability Standard clarifies the 
existing provision and does not present any reliability concerns.

[[Page 19154]]

    11. However, we have identified a concern regarding possible market 
implications of NERC's proposed modification to Requirement R3.1 of 
MOD-028-2. Although NERC's statutory functions are properly focused on 
the reliability of the Bulk-Power System, the Commission has determined 
that the ERO should also attempt to develop Reliability Standards that 
have no undue negative effect on competition. In Order No. 729, the 
Commission stated ``that a proposed Reliability Standard should not 
unreasonably restrict [ATC] * * * beyond any restriction necessary for 
reliability.'' \18\ The Commission noted that a transmission service 
provider could use parameters and assumptions to skew its ATC values, 
but stated that it expected such risks to be mitigated through 
complaints and the Commission's market oversight authority.\19\ In 
Order No. 672, the Commission stated that, ``[a]mong other possible 
considerations, a proposed Reliability Standard should not unreasonably 
restrict [ATC] * * * beyond any restriction necessary for reliability 
and should not limit use * * * in an unduly preferential manner.'' \20\
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    \18\ Order No. 729, 129 FERC ] 61,155 at P 109.
    \19\ Id. P 135.
    \20\ Order No. 672, FERC Stats. & Regs. ] 31,204 at P 332.
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    12. Although section 215(d)(2) of the FPA requires the Commission 
to give ``due weight'' to the technical expertise of the ERO, the 
statute is clear that ``due weight'' is not to be given ``with respect 
to the effect of a standard on competition.'' \21\
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    \21\ 16 U.S.C. 824o(d)(2).
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    13. We believe that NERC's proposed revision to R3.1.2 allows a 
transmission operator flexibility to choose either a daily or hourly 
load forecast when forecasting current-day and next-day TTC. However, 
we seek comments regarding whether a transmission operator could 
potentially use a load forecast assumption that is not applicable to 
the period being calculated. For example, a transmission operator using 
daily on-peak load forecasts in determining off-peak TTC for the 
current day could, either purposefully or inadvertently, suppress off-
peak ATC used by generators that make off-peak sales, or other 
customers who purchase hourly service. Accordingly, we seek comment 
whether this gives rise to any market-related concerns or the potential 
for undue discrimination in ATC calculations.

IV. Information Collection Statement

    14. The Office of Management and Budget (OMB) regulations require 
that OMB approve certain reporting and recordkeeping (collections of 
information) imposed by an agency.\22\ The information contained here 
is also subject to review under section 3507(d) of the Paperwork 
Reduction Act of 1995.\23\
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    \22\ 5 CFR 1320.11.
    \23\ 44 U.S.C. 3507(d).
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    15. As stated above, the Commission previously approved, in Order 
No. 729, the Reliability Standard that is the subject of the current 
rulemaking. This proposed rulemaking proposes to approve one revision 
to a previously approved Reliability Standard developed by NERC as the 
ERO. The proffered revision relates to an existing Reliability Standard 
and does not change this standard; therefore, it does not add to or 
otherwise increase entities' current reporting burden. Thus, the 
current proposal would not materially affect the burden estimates 
relating to the currently effective version of the Reliability 
Standards presented in Order No. 729. The MOD-028-1 Reliability 
Standard that is subject of the approved revision was approved in Order 
No. 729, and the related information collection requirements were 
reviewed and approved, accordingly.\24\ The Commission will submit the 
revised Reliability Standard to OMB as a request for ``no material'' or 
``nonsubstantive'' change.\25\
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    \24\ See Order No. 729, 129 FERC ] 61,155 at PP 307-312.
    \25\ This type of submittal means that there is no change to the 
existing burden estimates and the existing expiration date.
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V. Environmental Analysis

    16. 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.\26\ 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.\27\ The actions proposed 
herein fall within this categorical exclusion in the Commission's 
regulations.
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    \26\ Regulations Implementing the National Environmental Policy 
Act, Order No. 486, 52 FR 47,897 (Dec. 17, 1987), FERC Stats. & 
Regs., Regulations Preambles 1986-1990 ] 30,783 (1987).
    \27\ 18 CFR 380.4(a)(2)(ii).
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VI. Regulatory Flexibility Act Analysis

    17. The Regulatory Flexibility Act of 1980 (RFA) \28\ generally 
requires a description and analysis of proposed 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 Office of Size Standards 
develops the numerical definition of a small business.\29\ For electric 
utilities, 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. The 
Commission does not expect the revision discussed herein to materially 
affect the cost for small entities to comply with the proposed 
Reliability Standard. Therefore, the Commission certifies that the 
proposed rule will not have a significant economic impact on a 
substantial number of small entities.
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    \28\ 5 U.S.C. 601-612.
    \29\ See 13 CFR 121.201.
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VII. Comment Procedures

    18. 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 May 13, 2013. Comments must refer to 
Docket No. RM12-19-000, and must include the commenter's name, the 
organization they represent, if applicable, and their address in their 
comments.
    19. 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.
    20. Commenters that are not able to file comments electronically 
may mail or hand-deliver comments to: Federal Energy Regulatory 
Commission, Secretary of the Commission, 888 First Street NE., 
Washington, DC 20426.
    21. All comments will be placed in the Commission's public files 
and may be viewed, printed, or downloaded

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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.

VIII. Document Availability

    22. 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.
    23. 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.
    24. 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 
[email protected], or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at 
[email protected].

    By direction of the Commission.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2013-07114 Filed 3-28-13; 8:45 am]
BILLING CODE 6717-01-P