FERC-725Z Supporting Statement 10-18-2022

FERC-725Z (OMB Control No.: 1902-0276)

Docket number RD22-2-000 and IC22-24-000 (Renewal)

Supporting Statement for

FERC-725Z (Mandatory Reliability Standards: IRO Reliability Standards

The Federal Energy Regulatory Commission (Commission or FERC) requests the Office of Management and Budget (OMB) review and approve the mandatory reliability standards associated with FERC-725Z for three years. This request includes a combination of changes associated with docket number RD22-2-000 (updating IRO-008-3 (formerly IRO-008-2)) and a renewal in docket number IC22-24-000.

1. CIRCUMSTANCES THAT MAKE THE COLLECTION OF INFORMATION NECESSARY

On August 8, 2005, The Electricity Modernization Act of 2005, Title XII of the Energy Policy Act of 2005 (EPAct of 2005), was enacted into law.^[1] EPAct of 2005 added a new section 215 to the Federal Power Act (FPA), which requires a Commission-certified Electric Reliability Organization (ERO) to develop mandatory and enforceable Reliability Standards, subject to Commission review and approval.

Section 215 of the FPA requires the Commission-certified ERO to develop mandatory and enforceable Reliability Standards, subject to Commission review and approval. Once approved, the Reliability Standards may be enforced in the United States by the ERO subject to Commission oversight, or by the Commission independently. Pursuant to the requirements of FPA section 215, the Commission established a process to select and certify an ERO^[2] and, subsequently, certified the North American Electric Reliability Corporation (NERC)^[3] as the ERO. Pursuant to Section 215(d)(1) of the FPA and 18 CFR 39.5, the NERC is authorized to submit for Commission approval proposed Reliability Standards, and to propose revision or retirement of such standards.

^[1] The Energy Policy Act of 2005, Pub. L. No 109-58, Title XII, Subtitle A, 119 Stat. 594, 941 (2005), codified at 16 U.S.C. 824o (2006).

^[2] Rules Concerning Certification of the Electric Reliability Organization; and Procedures for the Establishment, Approval, and Enforcement of Electric Reliability Standards, Order No. 672, FERC Stats. & Regs. ¶ 31,204, order on reh’g, Order No. 672-A, FERC Stats. & Regs. ¶ 31,212 (2006).

^[3] The retirements will result in the elimination of 18 of 76 Reliability Standard requirements.

2. HOW, BY WHOM, AND FOR WHAT PURPOSE THE INFORMATION IS TO BE USED AND THE CONSEQUENCES OF NOT COLLECTING THE INFORMATION

In general, information collection and record retention requirements related to Reliability Standards are not submitted to or retained for audit by the Commission. Rather they are submitted to or retained for audit by NERC (the Commission-approved ERO) or the Compliance Enforcement Authority, as specified in each individual Reliability Standard.

NERC established the following IRO standards within FERC-725Z:

IRO-001-4 purpose is to establish the responsibility of Reliability Coordinators to act or direct other entities to act.

In a joint petition dated May 30, 2019, the North American Electric Reliability Corporation (“NERC”) and Western Electricity Coordinating Council (“WECC”) requested Commission approval for Reliability Standard IRO-002-6 (now IRO-002-7) (Reliability Coordination, Monitoring and Analysis). NERC and WECC stated that the “Reliability Standard IRO-002-7 reflects the addition of a regional Variance containing additional requirements applicable to Reliability Coordinators providing service to entities in the Western Interconnection.”

NERC maintains that the data exchange capability requirement in Reliability Standard IRO-002-7, Requirement R1 is covered by Reliability Standard IRO-008-3 (formerly IRO-008-2)., Requirement R1, which obligates the reliability coordinator to perform operational planning analyses to assess whether the planned operations for the next-day will exceed System Operating Limits and Interconnection Reliability Operating Limits within its wide area. NERC asserts that “to perform the required operational planning analyses, the Reliability Coordinator must have the data it deems necessary from those entities that possess it.” The revisions to IRO-008-3 apply to the RC and requires RCs to perform analyses and assessments to prevent instability, uncontrolled separation, or cascading. NERC added a new requirement requiring a RC to use its SOL methodology when determining SOL exceedances for its analyses and assessments and further revised a requirement requiring the RC to use its SOL risk-based notification framework when communicating SOL or IROL exceedances.

Currently effective IRO-009-2 applicable to reliability coordinators and the purpose of the standard is to prevent instability, uncontrolled separation, or cascading outages that adversely impact the reliability of the interconnection by ensuring prompt action to prevent or mitigate instances of exceeding Interconnection Reliability Operating Limits (IROLs).

Additionally, regarding data exchange, NERC cites Reliability Standard IRO-010-2 (Reliability Coordinator Data Specification and Collection) and its stated purpose of preventing instability, uncontrolled separation, or cascading outages “by ensuring the Reliability Coordinator has the data it needs to monitor and assess the operation of its Reliability Coordinator Area.” NERC states that under Reliability Standard IRO-010-2, Requirements R1, R2 and R3, the reliability coordinator must specify the data necessary for it to perform its operational planning analyses and provide the specifications to the entities from which it needs data who then must comply with the data request using a mutually agreeable format and security protocols.

IRO-014-3 purpose is to ensure that each Reliability Coordinator’s operations are coordinated such that they will not adversely impact other Reliability Coordinator Areas and to preserve the reliability benefits of interconnected operations.

IRO-017-1 (Outage Coordination) purpose is to ensure that outages are properly coordinated in the Operations Planning time horizon and Near-Term Transmission Planning Horizon. Reliability coordinators, planning coordinators, balancing authorities, transmission owners and transmission planners are applicable entities for IRO-017-1.

IRO-018-1 (Reliability Coordinator Real-time Reliability Monitoring and Analysis Capabilities), submitted by NERC. Requirement R3 requires reliability coordinators to have an alarm process monitor that provides notification to system operators when the failure of a real-time monitoring alarm processor has occurred. In this order, the Reliability Standards build on monitoring, real-time assessments and support effective situational awareness. The Reliability Standards accomplish this by requiring applicable entities to: (1) provide notification to operators of real-time monitoring alarm failures; (2) provide operators with indications of the quality of information being provided by their monitoring and analysis capabilities; and (3) address deficiencies in the quality of information being provided by their monitoring and analysis capabilities.

NERC observes that the performance of the requirements it cites is premised on the existence of data exchange capabilities, regardless of whether a separate requirement expressly requires the reliability coordinator to have data exchange capabilities in place.

3. DESCRIBE ANY CONSIDERATION OF THE USE OF IMPROVED INFORMATION TECHNOLOGY TO REDUCE THE BURDEN AND TECHNICAL OR LEGAL OBSTACLES TO REDUCING BURDEN

The use of current or improved technology and the medium are not covered in Reliability Standards.

We think that nearly all of the respondents are likely to make and keep related records in an electronic format. Each of the eight Regional Entities possesses a well-established compliance portal for registered entities to electronically submit compliance information and reports. The compliance portals allow documents developed by the registered entities to be attached and uploaded to the Regional Entity’s portal. Compliance data can also be submitted by filling out data forms on the portals. These portals are accessible through an internet browser password-protected user interface.

In general, the Commission supports the use of information technology to reduce burden.

4. DESCRIBE EFFORTS TO IDENTIFY DUPLICATION AND SHOW SPECIFICALLY WHY ANY SIMILAR INFORMATION ALREADY AVAILABLE CANNOT BE USED OR MODIFIED FOR USE FOR THE PURPOSE(S) DESCRIBED IN INSTRUCTION NO. 2

Filing requirements are periodically reviewed as OMB review dates arise or as the Commission may deem necessary in carrying out its regulatory responsibilities under the FPA to eliminate duplication and ensure that filing burden is minimized. There are no similar sources for information available that can be used or modified for these reporting purposes.

5. METHODS USED TO MINIMIZE THE BURDEN IN COLLECTION OF INFORMATION INVOLVING SMALL ENTITIES

In general, small entities may reduce their burden by taking part in a joint registration organization or a coordinated functional registration. These options allow a small entity to share the compliance burden with other entities and, thus, to minimize their own compliance burden. Detailed information regarding these options is available in NERC’s Rule of Procedure at Sections 507 and 508.¹

6. CONSEQUENCE TO FEDERAL PROGRAM IF COLLECTION WERE CONDUCTED LESS FREQUENTLY

NERC stated in its Petition that “[a]s the Western Interconnection prepares to transition to an environment in which more than one Reliability Coordinator will be providing services, focused coordination of these Reliability Coordinators will be of critical importance. To promote coordination among these Reliability Coordinators and help ensure reliability in the Western Interconnection, WECC developed the proposed regional Variance reflected in proposed Reliability Standard IRO-002-6.”

Failure to implement the changes could directly affect the ability to effectively monitor and control and ensure reliability of the Western interconnection in the bulk electric system.

Purpose IRO-001-4 (To establish the responsibility of Reliability Coordinators to act or direct other entities to act.): To establish the responsibility of Reliability Coordinators to act or direct other entities to act.  If this standard and the associated information collection requirements did not exist or were performed less frequently, it would not be possible to ensure that applicable entities are performing coordinated actions required for the reliability of the Bulk-Power System. This would likely lead to lower system reliability and higher vulnerability and risk, such as transmission system outages and loss of load.

Purpose IRO-002-6 (Reliability Coordination – Monitoring and Analysis): To provide System Operators with the capabilities necessary to monitor and analyze data needed to perform their reliability functions.  If this standard and the associated information collection requirements did not exist or were performed less frequently, it would not be possible to ensure that applicable entities are performing the monitoring and analysis required to maintain the reliability of the Bulk-Power System. This would likely lead to lower system reliability and higher risk.

Purpose IRO-008-3 (Formerly IRO-008-2) (Reliability Coordinator Operational Analyses and Real-time Assessments): Perform analyses and assessments to prevent instability, uncontrolled separation, or Cascading.  If this standard and the associated information collection requirements did not exist or were performed less frequently, it would not be possible to ensure that applicable entities are performing required analysis during operational or real-time horizons to maintain reliability of the Bulk-Power System. This would likely lead to lower system reliability and higher vulnerability and risk, such as transmission system outages and loss of load.

Purpose IRO-009-2 – (Reliability Coordinator Actions to Operate Within IROLs): To prevent instability, uncontrolled separation, or cascading outages that adversely impact the reliability of the interconnection by ensuring prompt action to prevent or mitigate instances of exceeding Interconnection Reliability Operating Limits (IROLs).  If this standard and the associated information collection requirements did not exist or were performed less frequently, it would not be possible to ensure that applicable entities are performing required actions needed to ensure IROL conditions are avoided or mitigated and may affect the reliability of the Bulk-Power System.

Purpose IRO-010-3 — (Reliability Coordinator Data Specification and Collection): To prevent instability, uncontrolled separation, or Cascading outages that adversely impact reliability, by ensuring the Reliability Coordinator has the data it needs to monitor and assess the operation of its Reliability Coordinator Area.  If this standard and the associated information collection requirements did not exist or were performed less frequently, it would not be possible to ensure that applicable entities have the access to data needed from other entities to ensure reliability of the Bulk-Power System. This would likely lead to lower system reliability and higher vulnerability and risk by operating in an unknown state.

Purpose IRO-014-3 — (Coordination Among Reliability Coordinators): To ensure that each Reliability Coordinator’s operations are coordinated such that they will not adversely impact other Reliability Coordinator Areas and to preserve the reliability benefits of interconnected operations.  If this standard and the associated information collection requirements did not exist or were performed less frequently, it would not be possible to ensure coordination among Reliability Coordinators. This which could put the Bulk Power System as risk leading to possible uncontrolled separations, voltage collapse or Cascading.

Purpose IRO-017-1 — (Outage Coordination): To ensure that outages are properly coordinated in the Operations Planning time horizon and Near-Term Transmission Planning Horizon.  If this standard and the associated information collection requirements did not exist or were performed less frequently, it would create the inability to track critical outages or cause overlaps that could threaten reliability of the Bulk Power System. Additionally, not planning outages correctly could cause Facilities to be out of service when needed to support operations.

Purpose IRO-018-1(i) – (Reliability Coordinator Real-time Reliability Monitoring and Analysis Capabilities): Establish requirements for Real-time monitoring and analysis capabilities to support reliable System operations. If this standard and the associated information collection requirements did not exist or were performed less frequently, it would not be possible to ensure that applicable entities can perform real-time analysis (a one-hour time frame) and may delay in performing actions needed to ensure Bulk-Power System remains reliable.

7. EXPLAIN ANY SPECIAL CIRCUMSTANCES RELATING TO THE INFORMATION COLLECTION

There are no special circumstances.

8. DESCRIBE EFFORTS TO CONSULT OUTSIDE THE AGENCY: SUMMARIZE PUBLIC COMMENTS AND THE AGENCY’S RESPONSE

The 60-day notice was published on August 3, 2022², and no comments were received. The 30-day notice was published on October 13, 2022³.

9. EXPLAIN ANY PAYMENT OR GIFTS TO RESPONDENTS

The Commission does not make payments or provide gifts to respondents.

10. DESCRIBE ANY ASSURANCE OF CONFIDENTIALITY PROVIDED TO RESPONDENTS

Responding entities do not submit the information to FERC. Rather, they submit the information to NERC, the regions, or maintain it internally. Since there are no submittals made to FERC, FERC provides no specific provisions to protect confidentiality.

According to the NERC Rules of Procedure section 1502, “…a Receiving Entity shall keep in confidence and not copy, disclose, or distribute any Confidential Information or any part thereof without the permission of the Submitting Entity, except as otherwise legally required.” This serves to protect confidential information submitted to or retained for NERC or Regional Entities.

11. PROVIDE ADDITIONAL JUSTIFICATION FOR ANY QUESTIONS OF A SENSITIVE NATURE, SUCH AS SEXUAL BEHAVIOR AND ATTITUDES, RELIGIOUS BELIEFS, AND OTHER MATTERS THAT ARE COMMONLY CONSIDERED PRIVATE

There are no questions of a sensitive nature that are considered private.

12. ESTIMATED BURDEN OF COLLECTION OF INFORMATION

The estimated annual burden and cost⁴ related to the reporting and recordkeeping requirements for FERC-725Z are as follows.

FERC-725Z -- Reporting and Recordkeeping Requirements for Reliability Standards IRO-001, IRO-002, IRO-008, IRO-009, IRO-010, IRO-014, IRO-017, and IRO-018.
Information Collection Requirements	No. of Respondents & Type of Entity (1)		Annual No. of Responses per Respondent (2)		Total No. of Responses (1) *(2) = (3)	Average Burden Hours & Cost Per Response ($) (4)	Total Annual Burden Hours & Total Annual Cost ($) (3) *(4) = (5)	Total Annual Burden Cost (5) / (1)
IRO-001-4		12 (RC)		1	12	24 hrs. $1,731.60	288 hrs. $20,779.20	$1,731.60
		168 (TOP)		1	168	12 hrs. $865.80	2,016 hrs. $145,454.40	$865.80
IRO-002-7		12 (RC)		1	12	24 hrs., $1,731.60	288 hrs., $20,779.20	$1,731.60
IRO-008-2		12 (RC)		1	12	160 hrs., $11,544	1,920 hrs., $138,528	$11,544
IRO-009-2		12 (RC)		1	12	12 hrs. $865.80	144 hrs. $10,389.60	$865.80
IRO-010-3		12 (RC)		1	12	24 hrs., $1,731.60	288 hrs., $20,779.20	$1,731.60
IRO-014-3		12 (RC)		1	12	12 hrs., $865.80	144 hrs., $10,389.60	$865.80
IRO-017-1		12 (RC)		1	12	1,200 hrs., $86,580	14,400 hrs., $1,038,960	$86,580
		63 (PC)		1	63	96 hrs., $6,926.40	6,048 hrs., $436,363.20	$6,926.40
		204 (TP)		1	204	96 hrs., $6,926.40	19,584 hrs., $1,412,985.60	$6,926.40
		326 (TO)		1	326	8 hrs., $577.20	2,608 Hrs., $188,167.20	$577.20
		96 (BA)		1	96	8 hr., $577.20	758 hrs., $54,689.70	$577.20
IRO-018-1	12 (RC)		1		12	24 hrs., $1,731.60	288 hrs., $20,779.20	$1,731.60
Total for FERC-725Z					953		48,774 hrs., $4,243,338

FERC-725Z (Modifications due to RD22-2)5
One Time Estimate Years 1 and 2
IRO-008-3	RC (12)	1	12	32 hrs., $2784	384 hrs. $33,408
Ongoing Estimate Year 3 ongoing
IRO-008-3	RC (12)	1	12	16 hrs., $1,392	192 hrs. $16,704
Sub-Total for FERC-725Z (RD22-2)			24		576 hrs. $50,112
Sub-Total for IRO-008-3 One-time			12		2,304 hrs., 200,448
Sub-Total for IRO-008-3 Ongoing			12		2,112 hrs., 183,744
Total for FERC-725 Z			977		49,350 hrs.

13. ESTIMATE OF THE TOTAL ANNUAL COST BURDEN TO RESPONDENTS

The costs related to the changes due to Docket No. RD19-6 are associated with burden hours (labor) and described in #12 and #15.

14. ESTIMATED ANNUALIZED COST TO FEDERAL GOVERNMENT

The Regional Entities and NERC do most of the data processing, monitoring, auditing, and compliance work for Reliability Standards. Any involvement by the Commission is covered under the FERC-725 (OMB Control No. 1902-0255) and is not part of this request or package. The data for FERC-725Z are not submitted to FERC.

The Commission does incur the costs associated with obtaining OMB clearance for the collection under the Paperwork Reduction Act of 1995 (PRA). The PRA Administrative Cost is a Federal Cost associated with preparing, issuing, and submitting materials necessary to comply with the PRA for rulemakings, orders, or any other vehicle used to create, modify, extend, or discontinue an information collection. This average annual cost includes requests for extensions, all associated rulemakings and orders, other changes to the collection, and associated publications in the Federal Register.

For FERC-725Z	Number of Employees (FTE)	Estimated Annual Federal Cost
Analysis and Processing of filings	0.0	$0
PRA Administrative Cost		$7,694
FERC Total		$7,694

15. REASONS FOR CHANGES IN BURDEN INCLUDING THE NEED FOR ANY INCREASE

Although there were corrections made to the burden estimates. In the past, combining reliability standards caused the same reliability standard to be accounted for multiple times, resulting in the previously recorded 6,686 responses (i.e. IRO-008-1 was carried over burden that should have been removed; reporting 135 respondents with 46 responses per respondent in error). These numbers were revised and updated to be the new calculated total of 953 responses. Staff looked at each reliability standard as its own unique project and in doing so eliminated the multiple entity count by making a more accurate representation of the number of responses.

NERC added a new requirement requiring a RC to use its SOL methodology when determining SOL exceedances for its analyses and assessments and further revised a requirement requiring the RC to use its SOL risk-based notification framework when communicating SOL or IROL exceedances. Due to the revision of IRO-008-2 (now IRO-008-3) the burden increased to 977 (increase of 24 responses) annual responses and 49,350 (increase of 576 burden hours) annual burden hours.

	Total Request	Previously Approved	Change due to Adjustment in Estimate	Change Due to Agency Discretion
Annual Number of Responses	977	6,686	-5,733	+24
Annual Time Burden (Hrs.)	49,350	50,083	-1,309	+576
Annual Cost Burden ($)	0	0	0	0

16. TIME SCHEDULE FOR PUBLICATION OF DATA

There is no publication of data associated with the FERC-725Z.

17. DISPLAY OF EXPIRATION DATE

The expiration dates are posted on ferc.gov at https://www.ferc.gov/information-collections.

17. EXCEPTIONS TO THE CERTIFICATION STATEMENT

There are no exceptions.

1 NERC Rules of Procedure Sections 507 and 508 are available at: https://www.nerc.com/FilingsOrders/us/RuleOfProcedureDL/NERC_ROP_Effective_20190125.pdf.

2 87 FR 47414

3 87 FR 62089

4 The hourly cost figures, for salary plus benefits, for the new standard are based on Bureau of Labor Statistics (BLS) information (at http://www.bls.gov/oes/current/naics2_22.htm), as of May 2021, and benefits information for March 2022 (at https://www.bls.gov/news.release/ecec.nr0.htm). For salary plus benefits, for reporting requirements, an electrical engineer (code 17-2071) is $72.15/hour; for the recordkeeping requirements, an information and record clerk (code 43-4199) is $42.35/hour.

5 RD22-2 published on September 9,2022; 87 FR 55422

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