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On May 20, 2014, FERC denied proposed changes to the tariff governing the forthcoming ISO New England Inc. (“ISO-NE”) Regulation Market. ISO-NE and the New England Power Pool (“NEPOOL”) Participants Committee (jointly “New England Parties”) are in the final stages of crafting the design for the Regulation Market and anticipated the market being ready to implement as early as May 21, 2014, several months prior to its FERC approved start date of October 2014.

On March 20, 2014, FERC partially clarified and denied rehearing of Order No. 791, which approved the Version 5 Critical Infrastructure Protection (“CIP”) Reliability Standards.  The Commission clarified issues surrounding the implementation of the order as well as the requirement that the North American Electric Reliability Corporation’s (“NERC”) conduct a survey of certain types of cyber assets.

On March 7, 2014, FERC ordered the North American Electric Reliability Corporation (“NERC”) to establish Reliability Standards for the physical protection of the Bulk-Power System.  The Reliability Standards will require certain owners or operators of facilities critical to the operation of the Bulk-Power System to identify such facilities and develop and implement plans for the physical protection of those facilities.  FERC directed NERC to submit the proposed Reliability Standards to FERC for approval within 90 days of the order.

On January 16, 2014, FERC issued a final rule approving the North American Electric Reliability Corporation (“NERC”) proposed Reliability Standard BAL-003-1 pertaining to Frequency Response and Frequency Bias Setting.  This standard directs “the amount of frequency response needed from balancing authorities to maintain interconnection frequency within defined bounds and includes requirements for the measurement and provision of frequency response.” 

On January 16, 2014, FERC proposed to approve the North American Electric Reliability Corporation’s (“NERC”) Reliability Standard for Geomagnetic Disturbances (“GMDs”).  In its proposal, FERC stated that Reliability Standard EOP-010-1 (Geomagnetic Disturbance Operations) is designed to mitigate the effects of GMDs on the Bulk-Power System.   NERC developed the Reliability Standard in response to directives in FERC’s Order No. 779.

On December 19, 2013, FERC issued a final rule approving a revised Reliability Standard for Protection System Maintenance.  The revised standard PRC-005-2, which consolidates the four current Reliability Standards into a single standard, will incorporate new requirements for minimum maintenance activities and maximum time intervals between maintenance activities for individual components of the bulk electric system.  The North American Electric Reliability Corporation (“NERC”) revised the standard in response to directives issued in FERC’s Order No. 693.

On December 9, 2013, the North American Electric Reliability Corporation (“NERC”) released its annual “Long-Term Reliability Assessment,” which considers current and anticipated issues in electric reliability for the next decade.  NERC explains that it evaluates certain “key reliability indicators,” including: peak demand, energy forecasts, resource adequacy, transmission development, changes in overall system characteristics and operating behavior, as well as other issues that may impact the reliability of the bulk power system.

On November 21, 2013, FERC approved, with modifications, the North American Electric Reliability Corporation’s (“NERC”) Version 5 Critical Infrastructure Protection (“CIP”) Reliability Standards, CIP-002-5 through CIP-011-1 (see April 22, 2013 edition of the WER).  In addition to approving the Version 5 CIP Reliability Standards, FERC also approved 19 new or revised definitions for inclusion in the Glossary of Terms used in NERC Reliability Standards.

On November 13 and 14, 2013, the North American Electric Reliability Corporation (‘NERC”) completed its international biennial Grid Security Exercise (“GridEx”) – a series of exercises that simulate cyber and physical attacks on the bulk power system.  The simulated exercises at GridEx are designed to test participating entities’ physical and cyber security procedures in response to a coordinated, disruptive attack.