On November 18, 2010, FERC directed the North American Electric Reliability Corporation (“NERC”) to revise the definition of the bulk electric system to include all facilities necessary for operating an interconnected transmission network. FERC said this is best achieved by eliminating the ability of regions to have discretion over the definition, and the definition should include all facilities at or above 100 kV except defined radial facilities. NERC should also develop the criteria and details of an exemption process for excluding facilities that are not necessary for operating the interconnected transmission network. Thus, FERC would like NERC to establish a bright line test.
When FERC issued Order No. 693, Mandatory Reliability Standards for the Bulk-Power System, the Commission noted the current definition had gaps that could exclude certain facilities. In Order No. 693, the bulk electric system definition is “[a]s defined by the Regional Reliability Organization, the electrical generation resources, transmission lines, interconnections with neighboring systems, and associated equipment, generally operated at voltages of 100 kV or higher. Radial transmission facilities serving only load with one transmission source are generally not included in this definition.” Although the Commission approved the definition, FERC acknowledged the potential for future gaps in coverage and said it would revisit the issue at a later date.
In December 2008, FERC stated that NERC and the NPCC region had conflicting lists of bulk electric system elements. A majority of the 115 kV and 138 kV transmission facilities in the NYISO Balancing Authority Area of the NPCC region were excluded. In fact, two NPCC 115kV lines were excluded in NPCC, but portions of those same lines connected to PJM facilities that were elements of the bulk electric system. FERC issued a notice of proposed rulemaking (“NOPR”) on March 18, 2010 stating the glossary definition of the bulk electric system should be revised, especially considering regions had the discretion to exclude facilities 100 kV or above, without NERC or Commission oversight. In addition to noting the NPCC conflicts, the NOPR also listed disturbance from 100-200 kV facilities that affected reliability.
NERC has the flexibility to develop another proposal in lieu of adopting the Commission’s changes, but that proposal must be just as effective as FERC’s method. Also, NERC is not permitted to compromise reliability with its proposal should it deviate from the Commission’s directions. The final rule will become effective sixty days after publication in the federal register.