[Federal Register Volume 79, Number 122 (Wednesday, June 25, 2014)]
[Rules and Regulations]
[Pages 35911-35920]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-14849]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 40

[Docket No. RM14-1-000 Order No. 797]


Reliability Standard for Geomagnetic Disturbance Operations

AGENCY: Federal Energy Regulatory Commission.

ACTION: Final rule.

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SUMMARY: Pursuant to section 215 of the Federal Power Act, the Federal 
Energy Regulatory Commission (Commission) approves Reliability Standard 
EOP-010-1 (Geomagnetic Disturbance Operations). The North American 
Electric Reliability Corporation, the Commission-certified Electric 
Reliability Organization, submitted the Reliability Standard for 
Commission

[[Page 35912]]

approval in response to a Commission directive in Order No. 779. 
Reliability Standard EOP-010-1 is designed to mitigate the effects of 
geomagnetic disturbances on the Bulk-Power System by requiring 
responsible entities to implement Operating Plans and Operating 
Procedures or Processes.

DATES: This rule is effective August 25, 2014.

FOR FURTHER INFORMATION CONTACT:

Michael Gandolfo (Technical Information), Office of Electric 
Reliability, Federal Energy Regulatory Commission, 888 First Street 
NE., Washington, DC 20426, Telephone: (202) 502-6817, 
[email protected].
Matthew Vlissides (Legal Information), Office of the General Counsel, 
Federal Energy Regulatory Commission, 888 First Street NE., Washington, 
DC 20426, Telephone: (202) 502-8408, [email protected].

SUPPLEMENTARY INFORMATION: 
147 FERC ] 61,209

Before Commissioners: Cheryl A. LaFleur, Acting Chairman; Philip D. 
Moeller, John R. Norris, and Tony Clark.

Final Rule

(Issued June 19, 2014)

    1. Pursuant to section 215 of the Federal Power Act (FPA),\1\ the 
Commission approves Reliability Standard EOP-010-1 (Geomagnetic 
Disturbance Operations). The North American Electric Reliability 
Corporation (NERC), the Commission-certified Electric Reliability 
Organization (ERO), submitted the Reliability Standard for Commission 
approval in response to a Commission directive in Order No. 779.\2\ The 
Reliability Standard is designed to mitigate the effects of geomagnetic 
disturbances (GMD) on the Bulk-Power System by requiring responsible 
entities to implement Operating Plans and Operating Procedures or 
Processes. The Commission also approves the associated violation risk 
factors and violation severity levels, implementation plan, and 
effective dates proposed by NERC.
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    \1\ 16 U.S.C. 824o.
    \2\ Reliability Standards for Geomagnetic Disturbances, Order 
No. 779, 78 FR 30,747 (May 23, 2013), 143 FERC ] 61,147, reh'g 
denied, 144 FERC ] 61,113 (2013).
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I. Background

A. Section 215 and Mandatory Reliability Standards

    2. Section 215 of the FPA requires the Commission to certify an ERO 
to develop mandatory and enforceable Reliability Standards, subject to 
Commission review and approval.\3\ Once approved, the Reliability 
Standards may be enforced in the United States by the ERO, subject to 
Commission oversight, or by the Commission independently.\4\
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    \3\ 16 U.S.C. 824o.
    \4\ Id. 824o(e).
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B. Order No. 779

    3. In Order No. 779, the Commission directed NERC, pursuant to FPA 
section 215(d)(5), to develop and submit for approval proposed 
Reliability Standards that address the impact of GMDs on the reliable 
operation of the Bulk-Power System. The Commission based its directive 
on the potentially severe, wide-spread impact on the reliable operation 
of the Bulk-Power System that can be caused by GMD events and the 
absence of existing Reliability Standards to address GMD events.\5\
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    \5\ Order No. 779, 143 FERC ] 61,147 at P 3.
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    4. The Commission directed NERC to implement the directive in two 
stages. In the first stage, the Commission directed NERC to submit, 
within six months of the effective date of Order No. 779, one or more 
Reliability Standards (First Stage GMD Reliability Standards) that 
require owners and operators of the Bulk-Power System to develop and 
implement operational procedures to mitigate the effects of GMDs 
consistent with the reliable operation of the Bulk-Power System.\6\
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    \6\ Id. P 2.
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    5. In the second stage, the Commission directed NERC to submit, 
within 18 months of the effective date of Order No. 779, one or more 
Reliability Standards (Second Stage GMD Reliability Standards) that 
require owners and operators of the Bulk-Power System to conduct 
initial and on-going assessments of the potential impact of benchmark 
GMD events on Bulk-Power System equipment and the Bulk-Power System as 
a whole. Order No. 779 directed that the Second Stage GMD Reliability 
Standards must identify benchmark GMD events that specify what severity 
GMD events a responsible entity must assess for potential impacts on 
the Bulk-Power System.\7\ Order No. 779 explained that, if the 
assessments identify potential impacts from benchmark GMD events, the 
Reliability Standards should require owners and operators to develop 
and implement a plan to protect against instability, uncontrolled 
separation, or cascading failures of the Bulk-Power System, caused by 
damage to critical or vulnerable Bulk-Power System equipment, or 
otherwise, as a result of a benchmark GMD event. The Commission 
directed that the development of this plan could not be limited to 
considering operational procedures or enhanced training alone, but 
should, subject to the potential impacts of the benchmark GMD events 
identified in the assessments, contain strategies for protecting 
against the potential impact of GMDs based on factors such as the age, 
condition, technical specifications, system configuration, or location 
of specific equipment.\8\ Order No. 779 observed that these strategies 
could, for example, include automatically blocking geomagnetically-
induced currents (GIC) from entering the Bulk-Power System, instituting 
specification requirements for new equipment, inventory management, 
isolating certain equipment that is not cost effective to retrofit, or 
a combination thereof.
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    \7\ Id.
    \8\ Id.
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C. NERC Petition

    6. On November 13, 2013, NERC petitioned the Commission to approve 
Reliability Standard EOP-010-1 and its associated violation risk 
factors and violation severity levels, implementation plan, and 
effective dates. In the petition, NERC states that the Reliability 
Standard is just, reasonable, not unduly discriminatory or 
preferential, and in the public interest. NERC maintains that the 
Reliability Standard satisfies the Commission's directive in Order No. 
779 corresponding to the development and submission of the First Stage 
GMD Reliability Standards.
    7. NERC states that, consistent with Order No. 779 and the NERC 
Functional Model, Reliability Standard EOP-010-1 applies to reliability 
coordinators and transmission operators with a ``Transmission Operator 
Area that includes a power transformer with a high side wye-grounded 
winding with terminal voltage greater than 200 kV.'' \9\ NERC explains 
that the Reliability Standard has three requirements: (1) Requirement 
R1 addresses coordination by reliability coordinators within their 
areas; (2) Requirement R2 addresses the dissemination of space weather 
information by reliability coordinators to ensure that entities within 
a reliability coordinator area have the appropriate information 
necessary to

[[Page 35913]]

take action and that the same information is available to all entities; 
and (3) Requirement R3 requires transmission operators to develop GMD 
Operating Procedures or Processes.
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    \9\ NERC Petition at 8 (``A power transformer with a `high side 
wye-grounded winding' refers to a power transformer with windings on 
the high voltage side that are connected in a wye configuration and 
have a grounded neutral connection.'').
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    8. NERC states that Requirement R1 requires each reliability 
coordinator to develop, maintain, and implement a GMD Operating Plan 
that coordinates the GMD Operating Procedures or Operating Processes 
within its reliability coordinator area.\10\ NERC explains that each 
reliability coordinator is required to ensure that GMD Operating 
Procedures and Operating Processes in its reliability coordinator area 
are not in conflict, but a reliability coordinator will not review the 
technical aspects of the GMD Operating Procedures and Operating 
Processes.\11\ Instead, according to NERC, each transmission operator 
will be responsible for the technical aspects of its Operating 
Procedures and Operating Processes. NERC further states that 
Requirement R1 requires each reliability coordinator to describe the 
activities that must be undertaken in order to mitigate the effects of 
a GMD event. NERC explains that, pursuant to Reliability Standard IRO-
001-1.1, each reliability coordinator has decision-making authority to 
act and to direct actions to be taken by transmission operators, 
balancing authorities, generator operators, transmission service 
providers, load-serving entities, and purchasing-selling entities 
within its reliability coordinator area to preserve the reliability of 
the bulk electric system.
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    \10\ Operating Plan, Operating Procedure, and Operating Process 
are existing terms defined in the Glossary of Terms Used in NERC 
Reliability Standards. See Glossary of Terms Used in NERC 
Reliability Standards (effective November 21, 2013) at 49-50.
    \11\ NERC explains that ``if Company A submitted an Operating 
Procedure proposing to take Line X out of service under specified 
GMD conditions, and Company B submitted an Operating Procedure that 
relies on Line X remaining in service in the event of a GMD--it is 
the responsibility of the Reliability Coordinator to identify this 
conflict.'' NERC Petition at 11-12 (emphasis in original). Beyond 
identifying a conflict and requiring its resolution by Company A and 
Company B, NERC states that the review is ``not intended to be a 
review by the Reliability Coordinator of the technical aspects of 
the GMD Operating Procedures or Processes.'' Id. at 11.
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    9. NERC states that Requirement R2 requires each reliability 
coordinator to disseminate space weather information to ensure 
coordination and consistent awareness in its reliability coordinator 
area. NERC maintains that entrusting this responsibility to reliability 
coordinators is appropriate given the reliability coordinator's wide-
area view. NERC also explains that Requirement R2 replaces existing 
Requirement R3 of Reliability Standard IRO-005-3.1a, which currently 
addresses dissemination of information regarding GMD forecasts.\12\
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    \12\ According to NERC, Reliability Standard IRO-005-3.1a will 
be retired once the Commission approves proposed Reliability 
Standard IRO-005-4, which is currently pending before the 
Commission. NERC Petition at 13.
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    10. NERC states that Requirement R3 requires each transmission 
operator to develop GMD Operating Procedures or Operating Processes to 
address GMD events. NERC explains that Requirement R3 is not 
prescriptive and allows each transmission operator to tailor its 
Operating Procedures or Operating Processes based on the transmission 
operator's assessment of entity-specific factors, such as geography, 
geology, and system topology. According to NERC, Requirement R3 
requires each transmission operator to specify: (1) Steps or tasks that 
must be conducted to receive space weather information; (2) what 
actions must be taken under what conditions, and such conditions must 
be predetermined; and (3) when and under what conditions the Operating 
Procedure or Operating Process is exited. NERC maintains that 
Reliability Standard EOP-010-1 does not prescribe specific actions that 
must be taken by responsible entities because ``a `one-size fits all' 
approach to crafting GMD Reliability Standards would fail to recognize 
the important role of locational differences.'' \13\
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    \13\ NERC Petition at 14.
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    11. NERC proposes that Reliability Standard EOP-010-1 become 
effective the ``first day of the first calendar quarter that is six 
months after the date that this standard is approved by an applicable 
governmental authority.'' \14\ However, NERC states that Requirement R2 
of Reliability Standard EOP-010-1, pertaining to reliability 
coordinator dissemination of space weather information, is meant to 
replace existing Requirement R3 of Reliability Standard IRO-005-3.1a, 
which includes similar language. Therefore, to avoid duplicative 
requirements being enforced at the same time, NERC proposes that, if 
Reliability Standard EOP-010-1 becomes effective prior to the 
retirement of Reliability Standard IRO-005-3.1a, then Requirement R2 of 
Reliability Standard EOP-010-1 will not become effective until the 
first day following retirement of Reliability Standard IRO-005-3.1a.
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    \14\ NERC Petition, Exhibit B (Implementation Plan) at 2.
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D. Notice of Proposed Rulemaking

    12. On January 16, 2014, the Commission issued a Notice of Proposed 
Rulemaking that proposed to approve Reliability Standard EOP-010-1 as 
just, reasonable, not unduly discriminatory or preferential, and in the 
public interest based on the Commission's review of NERC's petition and 
supporting exhibits.\15\ The NOPR stated that the Reliability Standard 
satisfies the directive in Order No. 779 that NERC submit one or more 
Reliability Standards that require owners and operators of the Bulk-
Power System to develop and implement operational procedures to 
mitigate the effects of GMDs consistent with the reliable operation of 
the Bulk-Power System. The NOPR also stated that the Reliability 
Standard is consistent with the guidance in Order No. 779 that NERC 
develop Reliability Standards that, rather than require specific 
operational procedures, require responsible entities to develop and 
implement entity-specific operational procedures because owners and 
operators of the Bulk-Power System are most familiar with their own 
equipment and system configurations.\16\ The NOPR further stated that 
the Reliability Standard requires coordination of operational 
procedures and processes, overseen by a functional entity with a wide-
area perspective (i.e., reliability coordinators), which is consistent 
with the guidance in Order No. 779.\17\
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    \15\ Reliability Standard for Geomagnetic Disturbance 
Operations, Notice of Proposed Rulemaking, 79 FR 3547 (Jan. 22, 
2014), 146 FERC ] 61,015 (2014) (NOPR).
    \16\ Id. P 38.
    \17\ Id.
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    13. In response to the NOPR, the Commission received 20 sets of 
comments. We address below the issues raised in the comments. The 
Appendix to this Final Rule lists the entities that filed comments in 
response to the NOPR.

II. Discussion

    14. Pursuant to FPA section 215(d)(2), we approve Reliability 
Standard EOP-010-1 as just, reasonable, not unduly discriminatory or 
preferential, and in the public interest. As the Commission stated in 
Order No. 779, ``operational procedures, while not a complete solution, 
constitute an important first step to addressing the GMD reliability 
gap because they can be implemented relatively quickly . . . [and] 
[o]perational procedures may help alleviate abnormal system conditions 
due to transformer absorption of reactive power during GMD events, 
helping to stabilize system voltage swings, and may potentially isolate 
some equipment from being damaged or

[[Page 35914]]

misoperated.'' \18\ We determine that Reliability Standard EOP-010-1 
addresses the directive in Order No. 779 that NERC submit one or more 
Reliability Standards that require owners and operators of the Bulk-
Power System to develop and implement operational procedures to 
mitigate the effects of GMDs consistent with the reliable operation of 
the Bulk-Power System.\19\ We also determine that the Reliability 
Standard is consistent with the guidance in Order No. 779 that NERC 
develop Reliability Standards that, rather than require specific 
operational procedures, require responsible entities to develop and 
implement entity-specific operational procedures because owners and 
operators of the Bulk-Power System are most familiar with their own 
equipment and system configurations.\20\ Further, we determine that the 
Reliability Standard requires coordination of operational procedures 
and processes, overseen by a functional entity with a wide-area 
perspective (i.e., reliability coordinators), which is also consistent 
with the guidance in Order No. 779.\21\
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    \18\ Order No. 779, 143 FERC ] 61,147 at P 36.
    \19\ Reliability Standard EOP-010-1 only addresses the First 
Stage GMD Reliability Standards directed in Order No. 779. The 
Reliability Standard does not address the Second Stage GMD 
Reliability Standards, which NERC indicates are under development. 
NERC Petition at 3.
    \20\ Order No. 779, 143 FERC ] 61,147 at P 38.
    \21\ Id.
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    15. Several commenters support approval of Reliability Standard 
EOP-010-1 without modification.\22\ We address below the following 
issues raised by other commenters: (A) the applicability section of 
Reliability Standard EOP-010-1; (B) effectiveness of GMD operational 
procedures; (C) implementation plan; and (D) other issues. We also 
address below the violation risk factors and violation severity levels 
associated with Reliability Standard EOP-010-1.
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    \22\ See comments submitted by NERC, IRC, EEI, Chamber of 
Commerce, Dominion, AEP, ITC, and ASO.
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A. Applicability Section of Reliability Standard EOP-010-1

NERC Petition
    16. NERC submitted a white paper as part of its petition explaining 
the technical justification for applying Reliability Standard EOP-010-1 
only to transmission operators that operate a power transformer with a 
high side wye-grounded winding with terminal voltage greater than 200 
kV in their transmission operator areas.\23\ In another white paper, 
NERC explains its proposal regarding the applicability of the 
Reliability Standard to reliability coordinators and transmission 
operators only.\24\ The White Paper Supporting Functional Entity 
Applicability explains that the reliability coordinator has 
``responsibility and authority for reliable operation within the 
Reliability Coordinator Area (RCA) . . . and includes a wide-area view 
with situational awareness of neighboring RCAs.'' \25\ NERC states that 
including reliability coordinators as applicable entities ``provides 
the necessary coordination for planning and real-time actions.'' \26\ 
With respect to transmission operators, NERC explains that ``[l]ike the 
[reliability coordinator], the [transmission operator] has 
responsibility and authority for the reliable operation of the 
transmission system within a specified area.'' \27\ In addition, NERC 
justifies omitting balancing authorities and generator operators from 
the scope of the Reliability Standard. NERC explains that balancing 
authorities ``can be expected to address GMD impacts through use of 
generation . . . [but] the [balancing authority] would not initiate 
actions unilaterally during a GMD event and would instead respond to 
the direction of the [transmission operator] and [reliability 
coordinator].'' \28\ As for generator operators, NERC states that some 
generator operators ``would not have the technical basis for taking 
steps [to mitigate GMDs] on [their] own and would instead take steps 
based on the [reliability coordinator's] or [transmission operator's] 
Operating Plans, Processes, or Procedures.'' \29\ NERC also notes that 
generator owners and generator operators will be considered for 
inclusion in the Second Stage GMD Reliability Standards, ``which will 
require applicable entities to conduct vulnerability assessment and 
develop appropriate mitigation strategies . . . [and that] [s]uch 
mitigation strategies could include the development of Operating 
Procedures for applicable [generator owners] and [generator 
operators].'' \30\
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    \23\ NERC Petition, Exhibit D (White Paper Supporting Network 
Applicability) at 1.
    \24\ NERC Petition, Exhibit E (White Paper Supporting Functional 
Entity Applicability).
    \25\ Id. at 2.
    \26\ Id.
    \27\ Id.
    \28\ Id. at 3-4.
    \29\ Id. at 4.
    \30\ Id.
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NOPR
    17. The NOPR stated that the applicability designations in 
Reliability Standard EOP-010-1 are appropriate, based on the 
justifications set forth in the white papers in Exhibits D and E of 
NERC's petition.
Comments
    18. Foundation, SmartSense, AFS, and Baker maintain that 
Reliability Standard EOP-010-1 should be applicable to more entities 
than transmission operators having a power transformer with a high side 
wye-grounded winding with terminal voltage greater than 200 kV in the 
transmission operator area.
    19. Foundation states that during the March 1989 solar storm 
discussed in Order No. 779, electric utilities reported effects on 
static VAR compensators and other reactive power equipment operating 
between 100 kV and 200 kV. Foundation notes that such equipment is 
``designed to provide reactive power and to stabilize transmission 
networks during GMD.'' \31\ Foundation states that Reliability Standard 
EOP-010-1 ``would exempt Transmission Operators with equipment 
operating between 100 kV and 200 kV.'' \32\ Foundation requests that 
the Commission remand Reliability Standard EOP-010-1 to include 
``owners and operators of all stabilizing and reactive power equipment 
operating between 100 kV and 200 kV.'' \33\
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    \31\ Foundation Comments at 10.
    \32\ Id.
    \33\ Id. at 13.
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    20. Foundation and SmartSense assert that the 200 kV threshold for 
transmission operators is inconsistent with the Commission-approved 
definition of bulk electric system, which generally includes assets 
operating at voltages of 100 kV and higher. SmartSense asserts that 
there is evidence that elements of the Bulk-Power System operating 
between 100 kV and 200kV would be substantially affected by a GMD 
event. In support, SmartSense cites to an Oak Ridge National Laboratory 
GMD Study and an article from the Idaho National Laboratory, which 
SmartSense states tested sub-200 kV transformers.\34\ SmartSense 
further claims that NERC improperly relied on a cost-benefit analysis 
to exclude networks operating at 200 kV and below.
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    \34\ SmartSense Comments at 10-11 (citing Oak Ridge National 
Laboratory, Electromagnetic Pulse: Effects on the U.S. Power Grid: 
Meta-R-319 at page 4-14 (January 2010), available at http://www.ornl.gov/sci/ees/etsd/pes/pubs/ferc_Meta-R-319.pdf; Idaho 
National Laboratory, INL Broadens Understanding of Solar Storms 
(December 16, 2013), available at https://inlportal.inl.gov/portal/server.pt/community/newsroom/257/feature_story_details/1269?featurestory=DA_615269).
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    21. Foundation, AFS, EMP Coalition, Kappenman, and Baker maintain 
that Reliability Standard EOP-010-1 should

[[Page 35915]]

be applicable to generator operators and/or balancing authorities.
    22. Foundation states that balancing authorities have real-time 
responsibilities that would be essential during a GMD event. Foundation 
asserts that excluding balancing authorities from the applicability 
section of Reliability Standard EOP-010-1 is ``operationally 
unworkable'' because it ``assumes that the real time responsibilities 
of Balancing Authorities under fast-moving GMD conditions could be 
assumed by Reliability Coordinators.'' \35\ Foundation states that the 
NOAA Space Weather Prediction Center would only provide 15-60 minutes 
warning of a severe solar storm. Foundation asserts that, given the 15-
60 minute limitation, there would be insufficient time for reliability 
coordinators to communicate with balancing authorities, transmission 
operators, and generator operators following a solar storm warning 
because the NERC Reliability Standards require three-part 
communications when engaging in oral, two-party communications.
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    \35\ Foundation Comments at 14.
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    23. Foundation and Kappenman also maintain that Reliability 
Standard EOP-010-1 does not address generator step up (GSU) 
transformers, which they assert are vulnerable to GMDs. Foundation 
contends that generator operators have been installing GIC monitors for 
their GSU transformers and have taken actions to downrate their GSU 
transformers during solar storms. Foundation also notes that the NERC 
GMD Task Force developed an Operating Procedure Template for generator 
operators.
Commission Determination
    24. We determine that the applicability section of Reliability 
Standard EOP-010-1 is technically justified and consistent with Order 
No. 779, both in terms of using a 200 kV threshold for determining 
applicable transmission operators and not including balancing 
authorities and generator operators as applicable entities.
    25. We reject the argument that the applicability threshold in 
Reliability Standard EOP-010-1 is inconsistent with the definition of 
bulk electric system because it excludes transmission operators with 
only 200 kV transformers and below. Instead, we determine that the 
applicability section of Reliability Standard EOP-010-1 complies with 
the directive in Order No. 779 that the First Stage GMD Reliability 
Standards should mitigate the effects of GMDs consistent with the 
reliable operation of the Bulk-Power System.\36\ The NERC petition and 
White Paper Supporting Network Applicability provide an adequate 
technical basis to conclude that transformers operating at 200 kV and 
below are likely to have a limited impact on the Bulk-Power System 
during a GMD event. We are not persuaded by the Foundation comments, 
discussed above, which do not refute this conclusion, or the materials 
cited by SmartSense. SmartSense cites a table in the Oak Ridge 
Laboratory GMD Study identifying at-risk transformers operating at 345 
kV, which fall within the applicability criteria.\37\ Moreover, the Oak 
Ridge Laboratory GMD Study found that significantly higher GIC flows 
occur at higher operating voltages.\38\
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    \36\ Order No. 779, 143 FERC ] 61,147 at P 29; see also 16 
U.S.C. 824o(a)(3) (``The term `reliability standard' means a 
requirement . . . to provide for the reliable operation of the bulk-
power system.''); Mandatory Reliability Standards for the Bulk-Power 
System, Order No. 693, FERC Stats. & Regs. ] 31,242, at PP 97-98, 
order on reh'g, Order No. 693-A, 120 FERC ] 61,053 (2007) 
(explaining that each Reliability Standard will identify the set of 
users, owners and operators that must comply with that standard and 
``NERC has indicated that in the future it may add to a Reliability 
Standard limitations on applicability based on electric facility 
characteristics such as generator nameplate ratings'').
    \37\ SmartSense Comments at 10 n.31 (citing Oak Ridge National 
Laboratory, Electromagnetic Pulse: Effects on the U.S. Power Grid: 
Meta-R-319 at page 4-14).
    \38\ Id. at page 1-15 (``The operating voltage of the 
transmission network is an important factor in determining the level 
of GIC flow that will occur on each part of the U.S. power grid. At 
the higher operating voltages, there are pronounced trends that: the 
average length of each line increases and the average circuit 
resistance decreases. These trends result in larger GIC flows in the 
higher voltage portions of the network, given the same geo-electric 
field conditions.'').
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    26. The applicability criteria for Reliability Standard EOP-010-1 
determine which transmission operators must comply with the Reliability 
Standard (i.e., those with a power transformer with a high side wye-
grounded winding with terminal voltage greater than 200 kV in the 
transmission operator area). While this criterion excludes transmission 
operators operating transformers 200 kV and below, the 200 kV threshold 
does not mean that applicable transmission operators will ignore 
reactive power supplies operating at 200 kV or below on their systems 
when developing the required GMD Operating Procedures or Operating 
Processes. Reliability Standard EOP-010-1, Requirement R3 supports this 
conclusion because it directs each applicable transmission operator to 
``develop, maintain, and implement a GMD Operating Procedure or 
Operating Process to mitigate the effects of GMD events on the reliable 
operation of its respective system.'' Accordingly, because Requirement 
R3 addresses an applicable transmission operator's entire system, the 
requirement is not limited to transformers operating above 200 kV for 
the purposes of developing GMD Operating Procedures or Operating 
Processes by applicable transmission operators.\39\
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    \39\ See NERC Petition at 14 (``An Operating Procedure or 
Operating Process is maintained when it is kept relevant by taking 
into consideration system configuration, conditions or operating 
experiences, as needed to accomplish its purpose. Requirement R3 . . 
. allows entities to tailor their Operational Procedures or 
Processes based on the responsible entity's assessment of entity-
specific factors, such as geography, geology, and system 
topology.'').
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    27. The Idaho National Laboratory article cited by SmartSense 
stated that a simulated solar event affected ``a pair of 138kV core 
form, 2 winding substation transformers, which had been in-service at 
[Idaho National Laboratory] since the 1950s,'' through increased losses 
and generation of harmonics that resulted in loss of excitation.\40\ 
The Idaho National Laboratory article does not contradict NERC's 
technical analysis, however. NERC does not contend that GMD events will 
have no effect on networks operating at 200 kV and below. Rather, the 
standard drafting team found that geomagnetically-induced currents 
generated on networks operated at 200 kV and below would be 
significantly less than those operated at higher voltages, a finding 
that is consistent with the Oak Ridge Laboratory GMD Study. 
Specifically, NERC's modeling of a portion of the Eastern 
Interconnection showed only a small change in system impact from a GMD 
event when 115 kV and 161 kV circuits were excluded from the model.\41\ 
The materials cited in the comments do not rebut NERC's technical 
analysis. In sum, we determine that there is adequate technical 
justification for the 200 kV threshold for transmission operators.\42\
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    \40\ Idaho National Laboratory, INL Broadens Understanding of 
Solar Storms (December 16, 2013), available at https://inlportal.inl.gov/portal/server.pt/community/newsroom/257/feature_story_details/1269?featurestory=DA_615269).
    \41\ NERC Petition, Exhibit D (White Paper Supporting Network 
Applicability) at 8 (Table A2).
    \42\ As we conclude that NERC provided adequate technical 
justification for the 200 kV applicability threshold, there is no 
reason to address SmartSense's assertion that NERC improperly based 
the 200 kV threshold on a cost-benefit analysis.
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    28. We also determine that NERC provided adequate justification not 
to include balancing authorities and generator operators in the 
applicability section of Reliability Standard EOP-

[[Page 35916]]

010-1. We disagree with Foundation's assertion that balancing 
authorities should be included in the applicability section because 
reliability coordinators are incapable of communicating quickly with 
transmission operators, generator operators, and balancing authorities 
due to the three-part communications requirement in Reliability 
Standard COM-002-2. We are not persuaded that GMD events pose unique 
communication problems for reliability coordinators because a 
reliability coordinator may only have 15-60 minutes warning of a severe 
solar storm. Reliability coordinators are responsible for real-time 
system reliability and often must respond quickly or even immediately 
to Bulk-Power System events with little or no warning.\43\ Reliability 
Standard COM-002-2, Requirement R1 recognizes this responsibility by 
stating that ``[e]ach Transmission Operator, Balancing Authority, and 
Generator Operator shall have communications (voice and data links) 
with appropriate Reliability Coordinators, Balancing Authorities, and 
Transmission Operators . . . [and] [s]uch communications shall be 
staffed and available for addressing a real-time emergency condition.''
---------------------------------------------------------------------------

    \43\ NERC, Reliability Functional Model Technical Document, 
Version 5, at 7 (Approved May 2010), available at http://www.nerc.com/pa/Stand/Functional%20Model%20Archive%201/FM_Technical_Document_V5_2009Dec1.pdf.
---------------------------------------------------------------------------

    29. With respect to generator operators, there is no dispute that 
GSU transformers are susceptible to geomagnetically-induced currents. 
While generator operators are not listed as applicable entities in 
Reliability Standard EOP-010-1, NERC explains that generator operators 
will have to act during a GMD event when directed by a reliability 
coordinator, in accordance with its reliability coordiantor's GMD 
Operating Plan, or by a transmission operator, in accordance with its 
transmission operator's GMD Operating Procedures or Operating 
Processes.\44\ We are not persuaded that generator operators should be 
required to act independently under Reliability Standard EOP-010-1. 
While generator operators might be, as Foundation asserts, increasingly 
installing GIC monitoring equipment, there is no evidence in the record 
regarding the proportion of generator operators with GIC monitoring 
capabilities. Accordingly, we agree with NERC that at least some 
generator operators would not have the technical basis to address a GMD 
event and would instead need to rely on reliability coordinators and 
transmission operators for direction.\45\ We also note that the 
Geomagnetic Disturbance Operating Procedure Template for generator 
operators developed by the NERC GMD Task Force, which the Foundation's 
comments reference, conditions some of its suggested actions on the 
generator operator having adequate monitoring systems.\46\ In sum, we 
are not persuaded by Foundation's comments and, rather, determine that 
there is adequate justification in the record for not including 
balancing authorities and generator operators in the applicability 
section of Reliability Standard EOP-010-1.\47\
---------------------------------------------------------------------------

    \44\ NERC Petition, Exhibit E (White Paper Supporting Functional 
Entity Applicability) at 2-4.
    \45\ Id. at 4.
    \46\ NERC, Geomagnetic Disturbance Operating Procedure Template 
Generator Operator, at 1, available at http://www.nerc.com/docs/pc/gmdtf/Template_GOP.pdf (``Some actions listed below should only be 
undertaken if supported by an adequate GIC impact study and/or if 
adequate monitoring systems are available. Otherwise they can make 
matters worse.'').
    \47\ While not basing our determination on NERC's representation 
or pre-judging what NERC ultimately submits in the Second Stage GMD 
Reliability Standards, we note NERC's statement that the standard 
drafting team for the Second Stage GMD Reliability Standards is 
considering including generator owners and generator operators in 
the applicability section of that proposed Reliability Standard. 
NERC Petition, Exhibit E at 4.
---------------------------------------------------------------------------

B. Effectiveness of GMD Operational Procedures

NERC Petition
    30. NERC states, quoting Order No. 779, that ``[o]perational 
procedures may help alleviate abnormal system conditions due to 
transformer absorption of reactive power during GMD events, helping to 
stabilize system voltage swings, and may potentially isolate some 
equipment from being damaged or misoperated.'' \48\ NERC explains that 
Reliability Standard EOP-010-1 ``is an important first step in 
addressing the issue of GMDs and can be implemented relatively quickly. 
While responsible entities will develop and implement Operational 
Procedures or Operational Processes, NERC will continue to support 
those efforts through the GMD Task Force, for example, by identifying 
and sharing Operating Plans, Processes, and Procedures found to be the 
most effective.'' \49\
---------------------------------------------------------------------------

    \48\ NERC Petition at 3 (quoting Order No. 779, 143 FERC ] 
61,147 at P 36).
    \49\ Id. at 3-4.
---------------------------------------------------------------------------

NOPR
    31. The NOPR stated that Reliability Standard EOP-010-1 satisfies 
the directive in Order No. 779 that NERC submit one or more Reliability 
Standards that require owners and operators of the Bulk-Power System to 
develop and implement operational procedures to mitigate the effects of 
GMDs consistent with the reliable operation of the Bulk-Power System. 
The NOPR also stated that operational procedures, while not a complete 
solution, constitute an important first step to addressing the GMD 
reliability gap.
Comments
    32. SmartSense and Orquin state that GMD operational procedures 
depend on the limited ability to predict GMD events. SmartSense states 
that space weather information is the ``default trigger'' for 
implementing operating procedures under Reliability Standard EOP-010-1 
but that space weather forecasts have a high error rate. SmartSense 
contends that relying on space weather forecasts alone will result in 
false alarms or missed GMD event forecasts. SmartSense maintains that 
real-time or near real-time monitoring data should be used in 
conjunction with space weather forecasts to trigger GMD operational 
procedures.
    33. Baker states that operational procedures will be ineffective 
because: (1) Grid operators will be reluctant to take action during a 
GMD event (e.g., shed load); (2) the warning period for solar storms 
does not allow enough time for grid operators to take action; (3) grid 
operators will not have enough situational awareness to know how to 
take action during a GMD event; (4) there is no capacity to address GMD 
events on a national scale; (5) operational procedures have been shown 
to be inadequate in other contexts; (6) equipment failure may undermine 
the grid operators' ability to respond; (7) GMD events will disrupt 
communication networks used by grid operators; (8) the potential 
effects of a GMD event on the Bulk-Power System are too complex to 
anticipate; and (9) Regional Transmission Organizations and Independent 
System Operators do not have the authority to shut down the grid in 
neighboring Regions. Foundation states that grid operators will have to 
act blindly during a GMD event because Reliability Standard EOP-010-1 
does not require GIC monitoring or mandatory sharing of GIC monitoring 
data. Foundation also states that Reliability Standard EOP-010-1 is 
ineffective because it does not require ``quantified contingency 
planning.'' Orquin maintains that operational procedures are of limited 
value and recommends using monitoring equipment and blocking devices at 
least as a back-up measure.

[[Page 35917]]

Commission Determination
    34. As the Commission stated in Order No. 779, operational 
procedures are not a complete solution to the risks posed by a GMD 
event to the Bulk-Power System. Order No. 779 directed NERC to develop 
Reliability Standards that require operational procedures because such 
Reliability Standards could be developed and implemented relatively 
quickly. While we recognize the concerns in the comments of Baker and 
others regarding the efficacy of operational procedures, Order No. 779 
weighed those concerns in ultimately directing NERC to develop 
operational procedures in the First Stage GMD Reliability Standards and 
more comprehensive protections in the Second Stage GMD Reliability 
Standards.\50\ We affirm the determination in Order No. 779 that 
operational procedures constitute ``an important first step to 
addressing the GMD reliability gap because they can be implemented 
relatively quickly . . . [and] may help alleviate abnormal system 
conditions due to transformer absorption of reactive power during GMD 
events, helping to stabilize system voltage swings, and may potentially 
isolate some equipment from being damaged or misoperated.'' \51\
---------------------------------------------------------------------------

    \50\ In Order No. 779, the Commission noted that some entities 
have already implemented operational procedures that address GMD 
events. Order No. 779, 143 FERC ] 61,147 at P 37.
    \51\ Order No. 779, 143 FERC ] 61,147 at P 36.
---------------------------------------------------------------------------

    35. With respect to the concerns raised by SmartSense regarding 
overreliance on space weather forecasts to trigger GMD operational 
procedures, Reliability Standard EOP-010-1 does not mandate the use of 
space weather to trigger the GMD operational procedures. While 
Requirement R2 requires reliability coordinators to disseminate current 
and forecasted space weather conditions to the appropriate functional 
entities, Requirement R3 requires transmission operators to develop 
Operating Procedures or Operating Processes that, at a minimum, include 
``System Operator actions to be initiated based on predetermined 
conditions.'' Those ``predetermined conditions'' might include space 
weather information or other data, including GIC monitoring data, if 
available. Requirement R3 ultimately leaves it to the transmission 
operator to define the predetermined conditions in its Operating 
Procedure or Operating Process. Accordingly, we disagree that 
Reliability Standard EOP-010-1 requires that initiation of GMD 
operating procedures be based upon space weather only.
    36. We are not persuaded that the First Stage GMD Reliability 
Standards should require all responsible entities to monitor GICs or 
mandate sharing GIC monitoring data with reliability coordinators, as 
Foundation contends. As explained above, we directed NERC to develop 
only operational procedures in the First Stage GMD Reliability 
Standards, and to develop more comprehensive protections in the Second 
Stage GMD Reliability Standards. The issue of monitoring requirements 
properly belongs in the Second Stage GMD Reliability Standards.\52\
---------------------------------------------------------------------------

    \52\ We will also consider then the need for the Second Stage 
GMD Reliability Standard's planning requirements to integrate 
appropriately with the First Stage GMD Reliability Standard's 
operating requirements.
---------------------------------------------------------------------------

    37. In terms of real-time sharing of GIC information with 
reliability coordinators, we note that Reliability Standard COM-002-2, 
Requirement R1.1 states that ``[e]ach Balancing Authority and 
Transmission Operator shall notify its Reliability Coordinator, and all 
other potentially affected Balancing Authorities and Transmission 
Operators through predetermined communication paths of any condition 
that could threaten the reliability of its area or when firm load 
shedding is anticipated.'' Accordingly, if a transmission operator 
monitors GIC levels that could threaten the reliability of its area of 
the Bulk-Power System, the transmission operator would have to 
communicate that information to its reliability coordinator.\53\ With 
respect to Foundation's comment that Reliability Standard EOP-010-1 
should include ``quantified contingency planning,'' Foundation does not 
explain the meaning of this term. In any case, we note that Reliability 
Standard EOP-010-1, Requirement R3 requires applicable transmission 
operators to ``develop, maintain, and implement a GMD Operating 
Procedure or Operating Process to mitigate the effects of GMD events on 
the reliable operation of its respective system.''
---------------------------------------------------------------------------

    \53\ We do not address here the issue of access to GMD 
monitoring data for other purposes, such as reassessing the 
benchmark GMD event, since this issue too belongs properly in the 
Second Stage GMD Reliability Standards.
---------------------------------------------------------------------------

C. Implementation Plan and Effective Dates

NERC Petition
    38. The NERC petition proposes that Reliability Standard EOP-010-1 
become effective the ``first day of the first calendar quarter that is 
six months after the date that this standard is approved by an 
applicable governmental authority.'' \54\ However, NERC states that 
Requirement R2 of Reliability Standard EOP-010-1, pertaining to 
reliability coordinator dissemination of space weather information, is 
meant to replace existing Requirement R3 of Reliability Standard IRO-
005-3.1a, which includes similar language. Therefore, to avoid 
duplicative requirements being enforced at the same time, NERC proposes 
that, if Reliability Standard EOP-010-1 becomes effective prior to the 
retirement of Reliability Standard IRO-005-3.1a, then Requirement R2 of 
Reliability Standard EOP-010-1 will not become effective until the 
first day following retirement of Reliability Standard IRO-005-
3.1a.\55\ According to NERC's petition, Requirements R1 and R3 of 
Reliability Standard EOP-010-1 are not affected by the possible 
retirement of IRO-05-3.1a and, thus, will be effective the first day of 
the first calendar quarter that is six months after the date that the 
Reliability Standard is approved by an applicable governmental 
authority.\56\
---------------------------------------------------------------------------

    \54\ NERC Petition, Exhibit B (Implementation Plan) at 2.
    \55\ We agree with NERC that Reliability Standard IRO-005-3.1a, 
Requirement R3, which requires that ``[e]ach Reliability Coordinator 
shall ensure its Transmission Operators and Balancing Authorities 
are aware of Geo-Magnetic Disturbance (GMD) forecast information and 
assist as needed in the development of any required response 
plans,'' and Requirement R2 of Reliability Standard EOP-010-1, which 
requires that ``[e]ach Reliability Coordinator shall disseminate 
forecasted and current space weather information to functional 
entities identified as recipients in the Reliability Coordinator's 
GMD Operating Plan,'' are largely duplicative in that both 
requirements require the dissemination of GMD forecast information, 
at a minimum, to applicable transmission operators.
    \56\ NERC Petition, Exhibit B (Implementation Plan) at 2. On 
April 16, 2013, NERC submitted a petition requesting approval of 
three revised IRO Reliability Standards and the retirement or 
revision of six currently-effective Reliability Standards, including 
IRO-005-3.1a (Docket No. RM13-15-000). On November 21, 2013, the 
Commission issued a Notice of Proposed Rulemaking that, inter alia, 
proposes to remand the proposed IRO Reliability Standards and 
related retirements and revisions. See Monitoring System 
Conditions--Transmission Operations Reliability Standard, 
Transmission Operation Reliability Standards, Interconnection 
Reliability Operations and Coordination Reliability Standards, 
Notice of Proposed Rulemaking, 78 FR 73,112 (Dec. 5, 2013), 145 FERC 
] 61,158 (2013). On January 14, 2014, the Commission granted NERC's 
motion to defer action, until January 31, 2015, on the rulemaking in 
Docket No. RM13-15-000. Monitoring System Conditions--Transmission 
Operations Reliability Standard, Transmission Operation Reliability 
Standards, Interconnection Reliability Operations and Coordination 
Reliability Standards, 146 FERC ] 61,023 (2014).
---------------------------------------------------------------------------

NOPR
    39. The NOPR proposed to approve NERC's implementation plan and 
effective dates for Reliability Standard EOP-010-1.

[[Page 35918]]

Comments
    40. APS states that a six-month implementation period is not a 
sufficient amount of time to create a new Operating Process or 
Operating Procedure. APS explains that it will develop an Operation 
Process or Operating Procedure after its reliability coordinator 
develops an Operating Plan that identifies the activities designed to 
mitigate the effects of GMD events on the Bulk-Power System. APS states 
that its Operating Process or Operating Procedure will then be reviewed 
by the reliability coordinator, and that it is unrealistic to expect 
all this to be done in six months. APS proposes allowing the 
reliability coordinator six months to develop its Operating Plan and 
then allowing transmission operators a further six months to develop 
their Operating Processes or Operating Procedures.
Commission Determination
    41. We determine that a six-month implementation period, as 
proposed by NERC, allows enough time for reliability coordinators and 
transmission operators to implement the requirements of Reliability 
Standard EOP-010-1. Only APS indicates that a six-month period does not 
afford applicable entities enough time to implement the Reliability 
Standard. No other commenter expresses similar concerns. Further, we 
see no reason why, as APS contends, a transmission operator must wait 
until its reliability coordinator has completed its Operating Plan 
before the transmission operator begins work on its Operating Process 
or Operating Procedure. Reliability coordinators and transmission 
operators should be able to work largely in parallel and coordinate 
their efforts to implement the requirements of the Reliability 
Standard. Accordingly, we approve the implementation plan and effective 
dates proposed by NERC.

D. Other Issues

    42. Commenters express concern that Reliability Standard EOP-010-1 
does not address electromagnetic pulses (EMPs).\57\ However, Order No. 
779 explicitly stated that EMPs were not within the scope of that 
rulemaking, which led to NERC's petition here.\58\ Likewise, 
Reliability Standard EOP-010-1 is responsive to the Commission 
directive, and comments critiquing the Reliability Standard for not 
addressing EMPs are outside the scope of the immediate proceeding.
---------------------------------------------------------------------------

    \57\ See comments submitted by Orquin, EMP, Stolov, and Baker.
    \58\ Order No. 779, 143 FERC ] 61,147 at P 14 n.20.
---------------------------------------------------------------------------

    43. Other commenters criticize the NERC Board of Trustees' approval 
of Reliability Standard EOP-010-1 because ``no substantive discussion 
occurred at the November 7 meeting [at which the NERC Board of Trustees 
approved the Reliability Standard] and, as a result, the public was 
deprived of its right for due process under Section 215 of the Federal 
Power Act.'' \59\ We find no basis to conclude that the NERC Board of 
Trustees either violated the NERC Rules of Procedure or otherwise acted 
improperly in approving Reliability Standard EOP-010-1. Foundation does 
not identify any rule or other provision that, it claims, the NERC 
Board of Trustees violated in allegedly failing to conduct a 
``substantive discussion'' at the November 7 meeting. Moreover, in 
considering whether to approve Reliability Standard EOP-010-1, the 
Commission established this rulemaking docket to provide the public 
with an opportunity to comment; thus the public has been afforded 
adequate due process under FPA section 215. This is in addition to 
opportunities to participate in NERC's standard development process, by 
submitting comments or otherwise.
---------------------------------------------------------------------------

    \59\ Foundation Comments at 45; see also CSP Comments at 1.
---------------------------------------------------------------------------

    44. In response to a comment that Reliability Standard EOP-010-1 
could interfere with the development of state-level efforts to address 
GMD events,\60\ we note that FPA section 215(j)(3) provides in relevant 
part that section 215 does not ``preempt any authority of any State to 
take action to ensure the safety, adequacy, and reliability of electric 
service within that State, as long as such action is not inconsistent 
with any reliability standard.'' We also observe that Reliability 
Standard EOP-010-1 does not preclude users, owners and operators of the 
Bulk-Power System from taking additional steps that are designed to 
mitigate the effects of GMD events, provided those additional steps are 
not inconsistent with the Commission-approved Reliability Standards.
---------------------------------------------------------------------------

    \60\ Maine Representative Boland Comments at 3.
---------------------------------------------------------------------------

E. Violation Risk Factors and Violation Severity Levels

    45. Each requirement of proposed Reliability Standard EOP-010-1 
includes one violation risk factor and has an associated set of at 
least one violation severity level. The ranges of ERO penalties for 
violations will be based on the sanctions table and supporting penalty 
determination process described in the Commission-approved NERC 
Sanction Guidelines, according to the NERC petition. The NOPR proposed 
to approve the proposed violation risk factors and violation severity 
levels for the requirements proposed in Reliability Standard EOP-010-1 
as consistent with the Commission's established guidelines.\61\ The 
Commission did not receive any comments regarding this aspect of the 
NOPR. Accordingly, the Commission approves the violation risk factors 
and violation severity levels for the requirements in Reliability 
Standard EOP-010-1.
---------------------------------------------------------------------------

    \61\ See North American Electric Reliability Corp., 135 FERC ] 
61,166 (2011).
---------------------------------------------------------------------------

III. Information Collection Statement

    46. The Office of Management and Budget (OMB) regulations require 
approval of certain information collection requirements imposed by 
agency rules. Upon approval of a collection(s) of information, OMB will 
assign an OMB control number and an expiration date. Respondents 
subject to the filing requirements of an agency rule will not be 
penalized for failing to respond to these collections of information 
unless the collections of information display a valid OMB control 
number. The Paperwork Reduction Act (PRA) requires each federal agency 
to seek and obtain OMB approval before undertaking a collection of 
information directed to ten or more persons, or contained in a rule of 
general applicability.
    47. The Commission is submitting these reporting requirements to 
OMB for its review and approval under section 3507(d) of the PRA. The 
Commission solicited comments on the need for and the purpose of the 
information contained in Reliability Standard EOP-010-1 and the 
corresponding burden to implement the Reliability Standard. The 
Commission received comments on specific requirements in the 
Reliability Standard, which we address in this Final Rule. However, the 
Commission did not receive any comments on our reporting burden 
estimates or on the need for and the purpose of the information 
collection requirements.
    48. The Commission based its paperwork burden estimates on the NERC 
compliance registry as of November 27, 2013. According to the registry, 
there are 16 reliability coordinators and 183 transmission operators.
    49. The Commission estimates an increased burden for each 
requirement, as explained in the chart below, for a total estimated 
burden of $238,800. The

[[Page 35919]]

Commission based the burden estimates on staff experience, knowledge, 
and expertise:

                                          Burden Estimate for Implementation of Reliability Standard EOP-010-1
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                             Number of    Average burden
         Reliability Standard No.                Type of respondents         Number of     responses per     hours per     Total annual    Total annual
                                                                            respondents     respondent       response      burden hours      cost \62\
                                                                                     (1)             (2)             (3)     (1)x(2)x(3)  ..............
ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½-------------------------------------------------------------------------------------------------------------
EOP-010-1 (R1)............................  Reliability Coordinator.....              16               1              20             320         $19,200
                                                                                                                                                ($60/hr)
EOP-010-1 (R3)............................  Transmission Operator.......             183               1              20            3660         219,600
                                                                                                                                                ($60/hr)
    Total.................................  ............................  ..............  ..............  ..............            3980         238,800
--------------------------------------------------------------------------------------------------------------------------------------------------------

     
---------------------------------------------------------------------------

    \62\ The estimated hourly loaded cost (salary plus benefits) for 
an engineer is assumed to be $60/hour, based on salaries as reported 
by the Bureau of Labor Statistics (BLS) (http://bls.gov/oes/current/naics2_22.htm). Loaded costs are BLS rates divided by 0.703 and 
rounded to the nearest dollar (http://www.bls.gov/news.release/ecec.nr0.htm). While the BLS figures have been updated since the 
issuance of the NOPR, the new BLS figures are not significantly 
different. For consistency, the Commission continues with the same 
loaded cost figure used in the NOPR.
---------------------------------------------------------------------------

    50. The above chart does not include Reliability Standard EOP-010-
1, Requirement R2 because, as NERC states, that requirement replaces 
IRO-005-3.1a, Requirement R3 and has no change in overall burden. In 
addition, while our burden estimate with respect to Reliability 
Standard EOP-010-1, Requirement R3 assumes that all 183 transmission 
operators are subject to that requirement, we note that not all 183 
transmission operators are likely to be subject to Requirement R3 
because that requirement only applies to transmission operators with a 
Transmission Operator Area that includes a power transformer with a 
high side, wye-grounded winding with terminal voltage greater than 200 
kV.
    Title: FERC-725S, Mandatory Reliability Standards: Reliability 
Standard EOP-010-1.
    Action: Proposed Collection of Information.
    OMB Control No: 1902-0270.
    Respondents: Business or other for profit, and not for profit 
institutions.
    Frequency of Responses: One-time and ongoing.
    Necessity of the Information: Reliability Standard EOP-010-1 
implements the Congressional mandate of the Energy Policy Act of 2005 
to develop mandatory and enforceable Reliability Standards to better 
ensure the reliability of the nation's Bulk-Power System. Specifically, 
the Reliability Standard ensures that responsible entities have 
Operating Plans and Operating Procedures or Processes in place to 
mitigate the effects of geomagnetic disturbances on the Bulk-Power 
System.
    Internal review: The Commission has reviewed Reliability Standard 
EOP-010-1 and has determined that the Reliability Standard is necessary 
to ensure the reliability and integrity of the Nation's Bulk-Power 
System.
    51. Interested persons may obtain information on the reporting 
requirements by contacting: Federal Energy Regulatory Commission, 888 
First Street NE., Washington, DC 20426 [Attention: Ellen Brown, Office 
of the Executive Director, email: [email protected], Phone: (202) 
502-8663, fax: (202) 273-0873]. Comments on the requirements of this 
rule may also be sent to the Office of Information and Regulatory 
Affairs, Office of Management and Budget, Washington, DC 20503 
[Attention: Desk Officer for the Federal Energy Regulatory Commission]. 
For security reasons, comments should be sent by email to OMB at [email protected]. Comments submitted to OMB should include Docket 
Number RM14-1-000.

IV. Environmental Analysis

    52. 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.\63\ 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.\64\ The actions here fall 
within this categorical exclusion in the Commission's regulations.
---------------------------------------------------------------------------

    \63\ Regulations Implementing the National Environmental Policy 
Act, Order No. 486, 52 FR 47897 (Dec. 17, 1987), FERC Stats. & 
Regs., Regulations Preambles 1986-1990 ] 30,783 (1987).
    \64\ 18 CFR 380.4(a)(2)(ii).
---------------------------------------------------------------------------

V. Regulatory Flexibility Act

    53. The Regulatory Flexibility Act of 1980 (RFA) \65\ generally 
requires a description and analysis of proposed rules that will have 
significant economic impact on a substantial number of small entities.
---------------------------------------------------------------------------

    \65\ 5 U.S.C. 601-612.
---------------------------------------------------------------------------

    54. The NOPR compared the NERC compliance registry with data 
submitted to the Energy Information Administration on Form EIA-861, 
which indicated that perhaps as many as 34 small entities were 
registered as transmission operators and no small entities were 
registered as reliability coordinators. However, the Commission 
estimated in the NOPR that there will be no material change in burden 
for the 34 transmission operators that qualified as small entities 
because they will likely not be subject to Reliability Standard EOP-
010-1. Reliability Standard EOP-010-1 applies to transmission operators 
with a Transmission Operator Area that includes a power transformer 
with a high side, wye-grounded winding with terminal voltage greater 
than 200 kV. The NOPR stated that transmission operators with 
Transmission Operator Areas that include a power transformer with a 
high side, wye-grounded winding with terminal voltage greater than 200 
kV are generally large entities serving substantial geographical areas 
with significant energy output. The Commission did not receive any 
comments regarding this aspect of the NOPR.
    55. Since the issuance of the NOPR, the Small Business 
Administration changed the small business size standard applicable to 
reliability coordinators and transmission operators. The Commission 
currently does not have an estimate of the number of small reliability 
coordinators and transmission operators using the new

[[Page 35920]]

size standard. However, the Commission still estimates that the 
specific applicability of Reliability Standard EOP-010-1 means that 
generally only large entities will have to meet the new requirements.
    56. Based on the above, the Commission certifies that Reliability 
Standard EOP-010-1 will not have a significant impact on a substantial 
number of small entities. Accordingly, no initial regulatory 
flexibility analysis is required.

VI. Document Availability

    57. 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.
    58. 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.
    59. 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].

VII. Effective Date and Congressional Notification

    60. These regulations are effective August 25, 2014. The Commission 
has determined, with the concurrence of the Administrator of the Office 
of Information and Regulatory Affairs of OMB, that this rule is not a 
``major rule'' as defined in section 351 of the Small Business 
Regulatory Enforcement Fairness Act of 1996.

    By the Commission.

    Issued: June 19, 2014.
Nathaniel J. Davis, Sr.,
Deputy Secretary.

Appendix

Commenters

------------------------------------------------------------------------
              Abbreviation                          Commenter
------------------------------------------------------------------------
AEP....................................  American Electric Power Service
                                          Corporation.
AFS....................................  Advanced Fusion Systems.
APS....................................  Arizona Public Service Company.
ASO....................................  Atomic Safety Organization.
Baker..................................  George H. Baker.
Maine Representative Boland............  Hon. Andrea M. Boland, Maine
                                          State Representative.
CSP....................................  Center for Security Policy.
Dominion...............................  Dominion Resources Services,
                                          Inc.
EEI....................................  Edison Electric Institute.
EMP Coalition..........................  EMP Coalition.
Emprimus...............................  Emprimus LLC.
Chamber of Commerce....................  Institute for 21st Century
                                          Energy, U.S. Chamber of
                                          Commerce.
Foundation.............................  Foundation for Resilient
                                          Societies.
IRC....................................  ISO/RTO Council.
ITC....................................  International Transmission
                                          Company.
Kappenman..............................  John G. Kappenman.
NERC...................................  North American Electric
                                          Reliability Corporation.
Orquin.................................  Alberto Ramirez Orquin.
SmartSenseCom..........................  SmartSenseCom, Inc.
Stolov.................................  Jerome J. Stolov.
------------------------------------------------------------------------


[FR Doc. 2014-14849 Filed 6-24-14; 8:45 am]
BILLING CODE 6717-01-P