16 U.S.C. 824o

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16 U.S.C.
United States Code, 2018 Edition
Title 16 - CONSERVATION
CHAPTER 12 - FEDERAL REGULATION AND DEVELOPMENT OF POWER
SUBCHAPTER II - REGULATION OF ELECTRIC UTILITY COMPANIES ENGAGED IN INTERSTATE
COMMERCE
Sec. 824o - Electric reliability
From the U.S. Government Publishing Office, www.gpo.gov

§824o. Electric reliability
(a) Definitions
For purposes of this section:
(1) The term "bulk-power system" means—
(A) facilities and control systems necessary for operating an interconnected electric energy
transmission network (or any portion thereof); and
(B) electric energy from generation facilities needed to maintain transmission system
reliability.
The term does not include facilities used in the local distribution of electric energy.
(2) The terms "Electric Reliability Organization" and "ERO" mean the organization certified by
the Commission under subsection (c) the purpose of which is to establish and enforce reliability
standards for the bulk-power system, subject to Commission review.
(3) The term "reliability standard" means a requirement, approved by the Commission under
this section, to provide for reliable operation of the bulk-power system. The term includes
requirements for the operation of existing bulk-power system facilities, including cybersecurity
protection, and the design of planned additions or modifications to such facilities to the extent
necessary to provide for reliable operation of the bulk-power system, but the term does not include
any requirement to enlarge such facilities or to construct new transmission capacity or generation
capacity.
(4) The term "reliable operation" means operating the elements of the bulk-power system within
equipment and electric system thermal, voltage, and stability limits so that instability, uncontrolled
separation, or cascading failures of such system will not occur as a result of a sudden disturbance,
including a cybersecurity incident, or unanticipated failure of system elements.
(5) The term "Interconnection" means a geographic area in which the operation of bulk-power
system components is synchronized such that the failure of one or more of such components may
adversely affect the ability of the operators of other components within the system to maintain
reliable operation of the facilities within their control.
(6) The term "transmission organization" means a Regional Transmission Organization,
Independent System Operator, independent transmission provider, or other transmission
organization finally approved by the Commission for the operation of transmission facilities.
(7) The term "regional entity" means an entity having enforcement authority pursuant to
subsection (e)(4).
(8) The term "cybersecurity incident" means a malicious act or suspicious event that disrupts, or
was an attempt to disrupt, the operation of those programmable electronic devices and
communication networks including hardware, software and data that are essential to the reliable
operation of the bulk power system.
(b) Jurisdiction and applicability
(1) The Commission shall have jurisdiction, within the United States, over the ERO certified by
the Commission under subsection (c), any regional entities, and all users, owners and operators of the

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bulk-power system, including but not limited to the entities described in section 824(f) of this title,
for purposes of approving reliability standards established under this section and enforcing
compliance with this section. All users, owners and operators of the bulk-power system shall comply
with reliability standards that take effect under this section.
(2) The Commission shall issue a final rule to implement the requirements of this section not later
than 180 days after August 8, 2005.
(c) Certification
Following the issuance of a Commission rule under subsection (b)(2), any person may submit an
application to the Commission for certification as the Electric Reliability Organization. The
Commission may certify one such ERO if the Commission determines that such ERO—
(1) has the ability to develop and enforce, subject to subsection (e)(2), reliability standards that
provide for an adequate level of reliability of the bulk-power system; and
(2) has established rules that—
(A) assure its independence of the users and owners and operators of the bulk-power system,
while assuring fair stakeholder representation in the selection of its directors and balanced
decisionmaking in any ERO committee or subordinate organizational structure;
(B) allocate equitably reasonable dues, fees, and other charges among end users for all
activities under this section;
(C) provide fair and impartial procedures for enforcement of reliability standards through the
imposition of penalties in accordance with subsection (e) (including limitations on activities,
functions, or operations, or other appropriate sanctions);
(D) provide for reasonable notice and opportunity for public comment, due process,
openness, and balance of interests in developing reliability standards and otherwise exercising
its duties; and
(E) provide for taking, after certification, appropriate steps to gain recognition in Canada and
Mexico.
(d) Reliability standards
(1) The Electric Reliability Organization shall file each reliability standard or modification to a
reliability standard that it proposes to be made effective under this section with the Commission.
(2) 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. The Commission shall give due weight to
the technical expertise of the Electric Reliability Organization with respect to the content of a
proposed standard or modification to a reliability standard and to the technical expertise of a regional
entity organized on an Interconnection-wide basis with respect to a reliability standard to be
applicable within that Interconnection, but shall not defer with respect to the effect of a standard on
competition. A proposed standard or modification shall take effect upon approval by the
Commission.
(3) The Electric Reliability Organization shall rebuttably presume that a proposal from a regional
entity organized on an Interconnection-wide basis for a reliability standard or modification to a
reliability standard to be applicable on an Interconnection-wide basis is just, reasonable, and not
unduly discriminatory or preferential, and in the public interest.
(4) The Commission shall remand to the Electric Reliability Organization for further consideration
a proposed reliability standard or a modification to a reliability standard that the Commission
disapproves in whole or in part.
(5) The Commission, upon its own motion or upon complaint, may order the Electric Reliability
Organization to submit to the Commission a proposed reliability standard or a modification to a
reliability standard that addresses a specific matter if the Commission considers such a new or
modified reliability standard appropriate to carry out this section.

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(6) The final rule adopted under subsection (b)(2) shall include fair processes for the identification
and timely resolution of any conflict between a reliability standard and any function, rule, order,
tariff, rate schedule, or agreement accepted, approved, or ordered by the Commission applicable to a
transmission organization. Such transmission organization shall continue to comply with such
function, rule, order, tariff, rate schedule or agreement accepted, approved, or ordered by the
Commission until—
(A) the Commission finds a conflict exists between a reliability standard and any such
provision;
(B) the Commission orders a change to such provision pursuant to section 824e of this title; and
(C) the ordered change becomes effective under this subchapter.
If the Commission determines that a reliability standard needs to be changed as a result of such a
conflict, it shall order the ERO to develop and file with the Commission a modified reliability
standard under paragraph (4) or (5) of this subsection.
(e) Enforcement
(1) The ERO may impose, subject to paragraph (2), a penalty on a user or owner or operator of the
bulk-power system for a violation of a reliability standard approved by the Commission under
subsection (d) if the ERO, after notice and an opportunity for a hearing—
(A) finds that the user or owner or operator has violated a reliability standard approved by the
Commission under subsection (d); and
(B) files notice and the record of the proceeding with the Commission.
(2) A penalty imposed under paragraph (1) may take effect not earlier than the 31st day after the
ERO files with the Commission notice of the penalty and the record of proceedings. Such penalty
shall be subject to review by the Commission, on its own motion or upon application by the user,
owner or operator that is the subject of the penalty filed within 30 days after the date such notice is
filed with the Commission. Application to the Commission for review, or the initiation of review by
the Commission on its own motion, shall not operate as a stay of such penalty unless the
Commission otherwise orders upon its own motion or upon application by the user, owner or
operator that is the subject of such penalty. In any proceeding to review a penalty imposed under
paragraph (1), the Commission, after notice and opportunity for hearing (which hearing may consist
solely of the record before the ERO and opportunity for the presentation of supporting reasons to
affirm, modify, or set aside the penalty), shall by order affirm, set aside, reinstate, or modify the
penalty, and, if appropriate, remand to the ERO for further proceedings. The Commission shall
implement expedited procedures for such hearings.
(3) On its own motion or upon complaint, the Commission may order compliance with a reliability
standard and may impose a penalty against a user or owner or operator of the bulk-power system if
the Commission finds, after notice and opportunity for a hearing, that the user or owner or operator
of the bulk-power system has engaged or is about to engage in any acts or practices that constitute or
will constitute a violation of a reliability standard.
(4) The Commission shall issue regulations authorizing the ERO to enter into an agreement to
delegate authority to a regional entity for the purpose of proposing reliability standards to the ERO
and enforcing reliability standards under paragraph (1) if—
(A) the regional entity is governed by—
(i) an independent board;
(ii) a balanced stakeholder board; or
(iii) a combination independent and balanced stakeholder board.
(B) the regional entity otherwise satisfies the provisions of subsection (c)(1) and (2); and
(C) the agreement promotes effective and efficient administration of bulk-power system
reliability.

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The Commission may modify such delegation. The ERO and the Commission shall rebuttably
presume that a proposal for delegation to a regional entity organized on an Interconnection-wide
basis promotes effective and efficient administration of bulk-power system reliability and should be
approved. Such regulation may provide that the Commission may assign the ERO's authority to
enforce reliability standards under paragraph (1) directly to a regional entity consistent with the
requirements of this paragraph.
(5) The Commission may take such action as is necessary or appropriate against the ERO or a
regional entity to ensure compliance with a reliability standard or any Commission order affecting
the ERO or a regional entity.
(6) Any penalty imposed under this section shall bear a reasonable relation to the seriousness of
the violation and shall take into consideration the efforts of such user, owner, or operator to remedy
the violation in a timely manner.
(f) Changes in Electric Reliability Organization rules
The Electric Reliability Organization shall file with the Commission for approval any proposed
rule or proposed rule change, accompanied by an explanation of its basis and purpose. The
Commission, upon its own motion or complaint, may propose a change to the rules of the ERO. A
proposed rule or proposed rule change shall take effect upon a finding by the Commission, after
notice and opportunity for comment, that the change is just, reasonable, not unduly discriminatory or
preferential, is in the public interest, and satisfies the requirements of subsection (c).
(g) Reliability reports
The ERO shall conduct periodic assessments of the reliability and adequacy of the bulk-power
system in North America.
(h) Coordination with Canada and Mexico
The President is urged to negotiate international agreements with the governments of Canada and
Mexico to provide for effective compliance with reliability standards and the effectiveness of the
ERO in the United States and Canada or Mexico.
(i) Savings provisions
(1) The ERO shall have authority to develop and enforce compliance with reliability standards for
only the bulk-power system.
(2) This section does not authorize the ERO or the Commission to order the construction of
additional generation or transmission capacity or to set and enforce compliance with standards for
adequacy or safety of electric facilities or services.
(3) Nothing in this section shall be construed to 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, except that the State of New York may
establish rules that result in greater reliability within that State, as long as such action does not result
in lesser reliability outside the State than that provided by the reliability standards.
(4) Within 90 days of the application of the Electric Reliability Organization or other affected
party, and after notice and opportunity for comment, the Commission shall issue a final order
determining whether a State action is inconsistent with a reliability standard, taking into
consideration any recommendation of the ERO.
(5) The Commission, after consultation with the ERO and the State taking action, may stay the
effectiveness of any State action, pending the Commission's issuance of a final order.
(j) Regional advisory bodies
The Commission shall establish a regional advisory body on the petition of at least two-thirds of
the States within a region that have more than one-half of their electric load served within the region.
A regional advisory body shall be composed of one member from each participating State in the

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region, appointed by the Governor of each State, and may include representatives of agencies, States,
and provinces outside the United States. A regional advisory body may provide advice to the Electric
Reliability Organization, a regional entity, or the Commission regarding the governance of an
existing or proposed regional entity within the same region, whether a standard proposed to apply
within the region is just, reasonable, not unduly discriminatory or preferential, and in the public
interest, whether fees proposed to be assessed within the region are just, reasonable, not unduly
discriminatory or preferential, and in the public interest and any other responsibilities requested by
the Commission. The Commission may give deference to the advice of any such regional advisory
body if that body is organized on an Interconnection-wide basis.
(k) Alaska and Hawaii
The provisions of this section do not apply to Alaska or Hawaii.
(June 10, 1920, ch. 285, pt. II, §215, as added Pub. L. 109–58, title XII, §1211(a), Aug. 8, 2005, 119
Stat. 941.)
STATUS OF ERO
Pub. L. 109–58, title XII, §1211(b), Aug. 8, 2005, 119 Stat. 946, provided that: "The Electric Reliability
Organization certified by the Federal Energy Regulatory Commission under section 215(c) of the Federal
Power Act [16 U.S.C. 824o(c)] and any regional entity delegated enforcement authority pursuant to section
215(e)(4) of that Act [16 U.S.C. 824o(e)(4)] are not departments, agencies, or instrumentalities of the United
States Government."
ACCESS APPROVALS BY FEDERAL AGENCIES
Pub. L. 109–58, title XII, §1211(c), Aug. 8, 2005, 119 Stat. 946, provided that: "Federal agencies
responsible for approving access to electric transmission or distribution facilities located on lands within the
United States shall, in accordance with applicable law, expedite any Federal agency approvals that are
necessary to allow the owners or operators of such facilities to comply with any reliability standard, approved
by the [Federal Energy Regulatory] Commission under section 215 of the Federal Power Act [16 U.S.C.
824o], that pertains to vegetation management, electric service restoration, or resolution of situations that
imminently endanger the reliability or safety of the facilities."

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