POWER June 2016 - 47

RELIABILITY
Risk-Based NERC Compliance:
Assessing Risk to Bulk Power
System Generation
Ensuring the reliability of the power system is the responsibility of many industry
participants. In this POWER exclusive, one regional reliability entity,
the Midwest Reliability Organization, explains its role.
Richard Burt
I
n response to the 2003 Blackout-which
affected parts of the U.S. Northeast and
Midwest, plus portions of the Canadian
province of Ontario-the U.S. Congress mandated
adoption of reliability standards for the
bulk power system (BPS). The North American
Electric Reliability Corp. (NERC) is responsible
for coordinating the development of
those mandatory reliability standards (written
by industry experts), which become effective
with approval from the Federal Energy Regulatory
Commission (FERC) in the U.S. and
authorization in Canada under arrangements
with each province. NERC has contracted with
Midwest Reliability Organization (MRO) and
seven other regional entities to be responsible
for compliance, monitoring, and enforcement
of the reliability standards.
Development of a Risk-Based
Approach
When MRO began enforcing mandatory reliability
standards in 2007, every instance of
noncompliance, no matter what the risk was
to reliable operations of the BPS, required a
formal enforcement proceeding with a filing
to FERC in the U.S. We literally made a federal
case out of everything.
In addition, each year a subset of the more
than 500 requirements in the reliability standards
was identified to be actively monitored
during the year across North America. This
meant that all entities performing similar
functions, regardless of size or uniqueness,
would be monitored on the same set of requirements
each year. A 5,000-MW generator
operator (GOP) control center would be
monitored for the same requirements as one
controlling 100 MW with regard to control
system infrastructure and security. A large
generator owner (GO) with a fleet of baseload
generation facilities and ownership of
generator lead lines out to the transmission
network would be monitored for the same
requirements as a wind farm with no power
delivery assets.
June 2016 | POWER
Today our work is informed by risk. We
have a way to process minimal-risk issues
without the formality of an enforcement proceeding.
Entities are now eligible, based on
past performance, to self-log minimal-risk
items. Of course, the entities have to share a
technically valid view of risk with MRO-a
cornerstone of self-logging.
The greatest challenge through this transition,
from a technical standpoint, is MRO
developing compliance oversight based on
risk-the ability to individually tailor compliance
oversight for each entity, based on
a technical analysis of its unique inherent
risks, as well as regional and continent-wide
risks (Figure 1).
Effective risk-based oversight starts with
the identification of risks. We have both
emerging risks, like the changing generation
resource mix (Figure 2) and the asymmetrical
threats of cyberattacks, in addition to understood
risks, such as correct facility ratings
and proper coordination between those responsible
for transmission and those responsible
for generation. Now NERC, through
its stakeholder structure, annually produces
a list of key continent-wide risks to be addressed.
A few of this year's continent-wide
risks are:
■ Cybersecurity protection of critical infrastructure,
such as generation control
systems.
■ Maintenance and management of assets,
such as facility ratings and protection system
maintenance.
■ Planning and system analysis, with a focus
on capacity emergencies and the changing
generation resource mix that is occurring
on the grid.
Due to regional differences, as well as the
fact that the North American grid is composed
of four distinct interconnections, MRO
performs a similar exercise to identify risks
that are unique to the region or the Eastern
Interconnection. This analysis is done using
region-specific data such as root causes of
power system events or major regional system
infrastructure changes, and it is informed
by trends identified through compliance
monitoring. Examples of regional risks that
were identified by MRO for 2016 include:
■ Implementation of facility ratings-
ensuring that the maximum power flow
through a facility does not violate applicable
equipment ratings. For example, a
generator should not be sized larger than
its associated generator step-up (GSU)
transformer, because at maximum generation
output, the GSU would become
overloaded.
■ Telecommunications infrastructure between
primary and backup control centers.
■ Changes in planning coordinator and regional
transmission organization (RTO)
footprints within MRO.
1. Layers of risks. Regional reliability organizations assess risk for individual entitles based
on a combination of continental, regional, and entity-specific factors. Courtesy: Midwest Reliability
Organization (MRO)
Continent-wide risks
Regional risks
Entity risks
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POWER June 2016

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