[Federal Register Volume 79, Number 141 (Wednesday, July 23, 2014)]
[Rules and Regulations]
[Pages 42670-42675]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-17229]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 40

[Docket Nos. RM13-19-000 and RM14-3-000; Order No. 799]


Generator Relay Loadability and Revised Transmission Relay 
Loadability Reliability Standards

AGENCY: Federal Energy Regulatory Commission, Energy.

ACTION: Final rule.

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SUMMARY: Pursuant to the section regarding Electric Reliability of the 
Federal Power Act, the Commission approves a new Reliability Standard, 
PRC-025-1 (Generator Relay Loadability), submitted by the North 
American Electric Reliability Corporation (NERC), the Commission-
approved Electric Reliability Organization. In addition, the Commission 
approves Reliability Standard PRC-023-3 (Transmission Relay 
Loadability), also submitted by NERC, which revises a currently-
effective standard pertaining to transmission relay loadability.

DATES:  This rule will become effective September 22, 2014.

FOR FURTHER INFORMATION CONTACT: Syed Ahmad (Technical Information), 
Office of Electric Reliability, Federal Energy Regulatory Commission, 
888 First Street NE., Washington, DC 20426, (202) 502-8718, 
syed.ahmad@ferc.gov.
    Julie Greenisen (Legal Information), Office of the General Counsel, 
Federal Energy Regulatory Commission, 888 First Street NE., Washington, 
DC 20426, (202) 502-6362, julie.greenisen@ferc.gov.

SUPPLEMENTARY INFORMATION: 

Before Commissioners: Cheryl A. LaFleur, Acting Chairman; Philip D. 
Moeller, John R. Norris, and Tony Clark.

    In the matter of: RM13-10-000, RM14-3-000, Generator Relay 
Loadability and Revised Transmission Relay Loadability Reliability 
Standards

Order No. 799

Final Rule

(Issued July 17, 2014)

    1. Pursuant to section 215 of the Federal Power Act (FPA),\1\ the 
Commission approves a new Reliability Standard, PRC-025-1 (Generator 
Relay Loadability), submitted by the North American Electric 
Reliability Corporation (NERC). In addition, the Commission approves 
Reliability Standard PRC-023-3 (Transmission Relay Loadability), also 
submitted by NERC, which revises a currently-effective standard 
pertaining to transmission relay loadability.
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    \1\ 16 U.S.C. 824o (2012).
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    2. NERC developed proposed Reliability Standard PRC-025-1 in 
response to certain Commission directives issued in Order No. 733,\2\ 
in which the Commission approved an initial version of a Reliability 
Standard governing transmission relay loadability. We find that the new 
standard on generator relay loadability, Reliability Standard PRC-025-
1, will enhance reliability by imposing mandatory requirements 
governing generator relay loadability, thereby reducing the likelihood 
of premature or unnecessary tripping of generators during system 
disturbances. In addition, we find that the revisions to PRC-023-2 are 
appropriate in that they clarify the applicability of the two standards 
governing relay loadability (PRC-025-1 and PRC-023-3), and prevent 
potential compliance overlap by eliminating potential inconsistencies. 
Finally, we approve the violation risk factors and violation severity 
levels as proposed for PRC-025-1, as well as the proposed 
implementation plans for the two standards.
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    \2\ Transmission Relay Loadability Reliability Standard, Order 
No. 733, 130 FERC ] 61,221 (2010) (Order No. 733); order on reh'g 
and clarification, Order No. 733-A, 134 FERC ] 61,127; clarified, 
Order No. 733-B, 136 FERC ] 61,185 (2011).
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I. Background

A. Regulatory Background

    3. Section 215 of the FPA requires a Commission-certified Electric 
Reliability Organization (ERO) to develop mandatory and enforceable 
Reliability Standards, subject to Commission review and approval.\3\ 
Once approved, the Reliability Standards may be enforced by the ERO 
subject to Commission oversight, or by the Commission independently.\4\ 
In 2006, the Commission certified NERC as the ERO pursuant to FPA 
section 215.\5\
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    \3\ 16 U.S.C. 824o(c) and (d).
    \4\ See id. 824o(e).
    \5\ North American Electric Reliability Corp., 116 FERC ] 
61,062, order on reh'g & compliance, 117 FERC ] 61,126 (2006), aff'd 
sub nom. Alcoa, Inc. v. FERC, 564 F.3d 1342 (D.C. Cir. 2009).
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B. Relay Protection Systems

    4. Protective relays are devices that detect and initiate the 
removal of faults on an electric system.\6\ They are designed to read 
electrical measurements, such as current, voltage, and frequency, and 
can be set to recognize certain measurements as indicating a fault. 
When a protective relay detects a fault on an element of the system 
under its protection, it sends a signal to an interrupting device, such 
as a circuit breaker, to disconnect the element from the rest of the 
system. Impedance relays, which are the most common type of relays used 
to protect transmission lines, continuously measure voltage and current 
on the protected transmission line and operate when the measured 
magnitude and phase angle of the impedance (voltage/current) falls 
within the settings of the relay.
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    \6\ A ``fault'' is defined in the NERC Glossary of Terms used in 
Reliability Standards as ``[a]n event occurring on an electric 
system such as a short circuit, a broken wire, or an intermittent 
connection.''
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C. Development of Reliability Standards on Relay Loadability

    5. Following the August 2003 blackout that affected parts of the 
Midwest, the Northeast, and Ontario, Canada, NERC and the U.S.-Canada 
Power System Outage Task Force (Task Force) concluded that a 
substantial number of transmission lines disconnected during the 
blackout when load-responsive phase-protection backup distance and 
phase relays operated unnecessarily, i.e. under non-fault conditions. 
Although these relays operated according to their settings, the Task 
Force determined that the operation of these relays for non-fault 
conditions contributed to cascading outages at the start of the 
blackout and accelerated the geographic spread of the cascade.\7\ 
Seeking to prevent or minimize the scope of future blackouts, both NERC 
and the Task Force developed recommendations to ensure that these types 
of protective relays do not contribute to future blackouts.\8\
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    \7\ U.S.-Canada Power System Outage Task Force, Final Report on 
the August 14, 2003 Blackout in the United States and Canada: Causes 
and Recommendations, at 80 (2004) (Final Blackout Report).
    \8\ See Final Blackout Report, Recommendation 21A; North 
American Electric Reliability Council, August 14, 2003 Blackout: 
NERC Actions to Prevent and Mitigate the Impacts of Future Cascading 
Blackouts, at 13 and Recommendation 8a (2004).

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[[Page 42671]]

    6. NERC developed Reliability Standard PRC-023-1 (Transmission 
Relay Loadability) to address these recommendations, and submitted it 
for Commission approval under FPA section 215. On March 10, 2010, in 
Order No. 733, the Commission approved Reliability Standard PRC-023-
1.\9\ In addition, the Commission directed NERC to (1) make certain 
modifications to the Reliability Standard, (2) submit a timeline for 
the development of a new Reliability Standard to address generator 
protective relay loadability, and (3) develop a new Reliability 
Standard addressing the issue of protective relay operation during 
stable power swings.
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    \9\ Order No. 733, 130 FERC ] 61,221.
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D. NERC Petition and Reliability Standards PRC-025-1 and PRC-023-3

1. Reliability Standard PRC-025-1
    7. On September 30, 2013, NERC submitted a petition seeking 
approval of Reliability Standard PRC-025-1 (Generator Relay 
Loadability).\10\ NERC stated in its petition that the standard ``is 
designed to prevent generator tripping when conditions do not pose a 
direct risk to the generator and associated equipment and will reduce 
the risk of unnecessary generator tripping--events that increase the 
severity of the disturbance''.\11\ NERC further stated that the 
standard is intended to address the second part of the Commission's 
Order No. 733 directives, requiring development of a standard governing 
generator protective relay loadability.\12\ NERC noted that it 
addressed the first Order No. 733 directive, requiring modification of 
PRC-023-1, through its revised standard PRC-023-2 (currently in 
effect).\13\ NERC indicated that it is addressing the third portion of 
the Order No. 733 directives, relay operation during stable power 
swings, as part of a separate phase of the project.\14\
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    \10\ Reliability Standards PRC-025-1 and PRC-023-3 are not 
attached to this Final Rule. The complete texts of these proposed 
Reliability Standards are available on the Commission's eLibrary 
document retrieval system in Docket Nos. RM13-19-000 and RM14-3-000, 
and are posted on NERC's Web site, available at: http://www.nerc.com.
    \11\ Petition of the North American Electric Reliability Corp. 
for Approval of Proposed Reliability Standard PRC-025-1 (Generator 
Relay Loadability), Docket No. RM13-19-000 at 4 (Sept. 30, 2013) 
(September 30 Petition or Petition). NERC requested that the 
Commission delay its consideration of PRC-025-1 until NERC could 
finalize and submit for approval certain related revisions to its 
transmission relay loadability standard, PRC-023-2. Those revisions 
were submitted on December 17, 2013, as discussed further below.
    \12\ See id. at 8.
    \13\ Id. (citing Transmission Relay Loadability Reliability 
Standard, Order No. 759, 138 FERC ] 61,197 (2012)).
    \14\ Id. NERC indicated that this third phase of its response to 
Order No. 733 is tentatively scheduled to be completed in December 
2014. Id.
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    8. NERC explained that the stated purpose of PRC-025-1 is ``[t]o 
set load-responsive protective relays associated with generation 
Facilities at a level to prevent unnecessary tripping of generators 
during a system disturbance for conditions that do not pose a risk of 
damage to the associated equipment''.\15\ Reliability Standard PRC-025-
1 will apply to any generator owner, transmission owner, or 
distribution provider ``that applies load-responsive protective relays 
at the terminals of the Elements listed in 3.2, Facilities.'' \16\ The 
term ``facilities,'' in turn, is defined in section 3.2 of the proposed 
standard as:
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    \15\ September 30 Petition, Ex. A at 3. While NERC has not 
proposed a definition for the term ``load-responsive protective 
relays,'' Attachment A of existing Reliability Standard PRC-023-2, 
which also uses the term ``load-responsive protective relays'' 
states that the standard includes ``any protective functions which 
could trip with or without time delay, on load current.'' NERC 
Reliability Standard PRC-023-2, available at: http://www.nerc.com/_layouts/PrintStandard.aspx?standardnumber=PRC-023-2&title=Transmission%20Relay%20Loadability&jurisdiction=United%20States.
    \16\ September 30 Petition, Ex. A at 3. NERC further explained 
that the standard should ``include all load-responsive protective 
relays that are affected by increased generator output in response 
to system disturbances.'' September 30 Petition, Ex. A at 25 
(Guidelines and Technical Basis) (hereinafter Guidelines).

Elements associated with Bulk Electric System (BES) generating units 
and generating plants, including those . . . identified as 
Blackstart Resources in the Transmission Operator's system 
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restoration plan:

3.2.1 Generating unit(s).
3.2.2 Generator step-up (i.e., GSU) transformer(s).
3.2.3 Unit auxiliary transformer(s) (UAT) that supply overall 
auxiliary power necessary to keep generating unit(s) online.
3.2.4 Elements that connect the GSU transformer(s) to the 
Transmission system that are used exclusively to export energy 
directly from a BES generating unit or generating plant. Elements 
may also supply generating plant loads.
3.2.5 Elements utilized in the aggregation of dispersed power 
producing resources.

    9. Reliability Standard PRC-025-1 has only one requirement, that 
each applicable entity ``shall apply settings that are in accordance 
with PRC-025-1--Attachment 1: Relay Settings, on each load-responsive 
protective relay while maintaining reliable fault protection.'' \17\ 
The relay setting options are defined in Table 1 of Attachment 1, and 
include the specific bus voltage and other inputs to be used depending 
on the application (e.g., synchronous or asynchronous generator, 
generator step-up transformer, or unit auxiliary transformer) and the 
type of relay. For most applications of each type of relay, the 
proposed standard would give applicable entities the option of adopting 
relay settings that meet the stated criteria as determined through: (1) 
a relatively simple calculation; (2) a more complex calculation; or (3) 
a described simulation. As stated in the standard, the criteria in 
Attachment 1 ``represent short-duration conditions during which 
generation Facilities are capable of providing system reactive 
resources, and for which generation Facilities have been historically 
recorded to disconnect, causing events to become more severe.'' \18\
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    \17\ Id. at 18, and Ex. A at 4.
    \18\ Id., Ex. A at 4 (Rationale for R1).
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    10. NERC explained in its petition that the specific relay setting 
criteria are based on system conditions observed during the August 2003 
Blackout.\19\ Specifically, the criteria for relays applied on 
synchronous generators, and their associated generator step-up 
transformers (GSUs) and connecting elements, are based on the response 
of the synchronous generator to depressed transmission system voltage 
(with allowances for reactive power losses across the GSU transformer). 
The criteria for relays applied on asynchronous generators and their 
associated GSU transformers and connecting elements are based on the 
more limited response of an asynchronous generator to the depressed 
voltage (with no allowance for loss of reactive power across the GSU 
transformer because such losses are not significant).\20\ The criteria 
for relays applied on unit auxiliary transformers (UATs) that supply 
station service are based on the increased current requirements of 
station service load during a depressed voltage condition.
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    \19\ Id. at 10.
    \20\ Id. at 11.
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    11. In its justification for approval of the proposed standard, 
NERC explained that ``[a]nalyses of power system disturbances over the 
past twenty-five years have found generators to have tripped 
unnecessarily--an occurrence that has the potential to extend the scope 
and duration of a disturbance.'' \21\ According to NERC, during the 
recovery phase of a disturbance, system voltage may be widely depressed 
and may fluctuate. To support the system during

[[Page 42672]]

this phase of a disturbance, NERC explained that the proposed standard 
``establishes criteria for setting load-responsive relays such that 
individual generators may provide Reactive Power within their dynamic 
capability during transient time periods,'' thereby avoiding 
unnecessary tripping of generators and ensuring that ``dynamic 
capability is available to support system recovery.'' \22\
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    \21\ Id. at 9.
    \22\ Id. at 9-10.
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    12. NERC proposed to assign a ``High'' violation risk factor to 
Requirement R1 of PRC-025-1, and a ``Severe'' violation severity level 
for failure to apply settings as required. NERC's Implementation Plan 
proposed that applicable entities must be in compliance with the new 
standard: (1) 60 months after regulatory approval where compliance can 
be achieved without replacement or removal of relays; or (2) 84 months 
after regulatory approval if replacement or removal of relays is 
necessary.\23\
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    \23\ See September 30 Petition, Ex. B (Implementation Plan).
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2. Proposed Reliability Standard PRC-023-3
    13. On December 17, 2013, NERC submitted proposed clarifying 
changes to Reliability Standard PRC-023-2, as reflected in PRC-023-3, 
as ``Supplemental Information'' to its September 30 Petition.\24\ NERC 
explained in its Supplemental Filing that these changes were identified 
during development of PRC-025-1 as ``necessary to establish a bright-
line distinction between the applicability of load-responsive 
protective relays in the transmission and generator relay loadability 
Reliability Standards.'' \25\ NERC explained that stakeholders became 
concerned about potential compliance overlap between the new generator 
relay loadability standard, PRC-025-1, and existing standard PRC-023-2, 
which currently applies to certain elements that connect GSU 
transformers to the transmission system.
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    \24\ Supplemental Information to the Petition of the North 
American Electric Reliability Corp. for Approval of Proposed 
Reliability Standard PRC-025-1 (Generator Relay Loadability), Docket 
No. RM14-3-000 (Dec. 17, 2013) (Supplemental Filing).
    \25\ Id. at 1-2.
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    14. In order to clarify that proposed standard PRC-025-1 is 
intended to cover ``all load responsive protective relays applied at 
the terminals of generators and GSU transformers,'' \26\ NERC proposed 
to remove Criterion 6 of Requirement R1 from PRC-023-2 in its entirety. 
That sub-requirement currently requires applicable entities to:
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    \26\ See id. at 4.

    Set transmission line relays applied on transmission lines 
connected to generation stations remote to load so they do not 
operate at or below 230% of the aggregated generation nameplate 
capability.\27\
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    \27\ See Supplemental Filing, Ex. A, Redline of PRC-023-2 at 6.

NERC also proposed to change the applicability section of PRC-023-2 to 
exclude ``Elements that connect the GSU transformer(s) to the 
Transmission system that are used exclusively to export energy directly 
from a BES generating unit or generating plant.'' \28\
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    \28\ See Supplemental Filing at 4, and Ex. A, Proposed 
Reliability Standard PRC-023-3, Sections 4.2.1.1 and 4.2.2.1.
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    15. NERC explained in its Supplemental Filing that the two relay 
loadability standards, as revised, would be based on the location where 
the relays are applied and not on the intended protection functions, 
which NERC considers advantageous because it:

(i) Facilitates the establishment of generator relay loadability 
requirements based on the physics associated with increased 
generator output during stressed system conditions.
(ii) Avoids ambiguity as to whether the intended protection function 
is for the generating unit or the Transmission System. . . .
(iii) Provides clear division of applicability between the Generator 
and Transmission Relay Loadability Reliability Standards based on 
the physical location, independent of the entity that owns the 
relay.\29\
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    \29\ Supplemental Filing at 5.

    16. Under NERC's proposed implementation plan, Reliability Standard 
PRC-023-3 will become effective on the first day of the first calendar 
quarter beyond the date that the standard is approved by the applicable 
regulatory authority. Reliability Standard PRC-023-2 would be retired 
immediately prior to the effective date of PRC-023-3, except that 
Criterion 6 of Requirement R1 would remain in effect until the 
effective date of PRC-025-1. Any implementation dates or milestones 
established under PRC-023-2 would remain in place.\30\
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    \30\ As part of its Supplemental Filing, NERC also submitted a 
report on UAT relay loadability to address concerns raised by 
minority commenters during the development of PRC-025-1 as to 
whether UAT relays on the low-voltage side should be included. See 
id. at 6 and Ex. E. The report concludes that there is no adverse 
reliability impact from Reliability Standard PRC-025-1 as proposed, 
and finds that ``based on a comparison of the simulation models and 
the actual event data, the simulation results are conservative. The 
model results, coupled with the NERC Generating Availability Data 
System (GADS) analysis, are indicative that a reliability gap does 
not result from excluding relays on the low-voltage side of the UAT 
from PRC-025-1.'' Supplemental Filing at 6, Ex. E at 6.
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E. Notice of Proposed Rulemaking and Subsequent Filings

    17. On March 20, 2014, the Commission issued a Notice of Proposed 
Rulemaking proposing to approve Reliability Standards PRC-023-3 and 
PRC-025-1.\31\ The Commission explained that approving the new 
Reliability Standard on generator relay loadability, PRC-025-1, would 
enhance reliability by imposing mandatory requirements governing 
generator relay loadability, thereby reducing the likelihood of 
premature or unnecessary tripping of generators during system 
disturbances. In addition, the Commission noted that the proposed 
revisions to PRC-023-2 are appropriate because they would clarify the 
applicability of the two standards governing relay loadability and 
would prevent potential compliance overlap by eliminating potential 
inconsistencies.
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    \31\ Generator Relay Loadability and Transmission Relay 
Loadability Reliability Standards, Notice of Proposed Rulemaking, 
146 FERC ] 61,189 (2014) (NOPR).
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    18. Comments on the NOPR were due by April 28, 2014. Five sets of 
comments were received, submitted by NERC, by the Edison Electric 
Institute (EEI) and the Electric Power Supply Association (EPSA) 
(jointly, EEI/EPSA), and by three individuals.\32\ All commenters 
supported the approval of Reliability PRC-023-3 and PRC-025-1. EEI/EPSA 
describe the standard as ``provid[ing] clarity with respect to 
premature or unnecessary tripping of generators and associated 
auxiliaries during disturbances while satisfying outstanding directives 
issued in Order No. 733.'' \33\ EEI/EPSA note that their earlier 
concern, ``that a simple application of PRC-023-1 to generator 
protection systems might unintentionally create a risk of damage to 
generation assets'' has been addressed through ``development of PRC-
025-1 and the clearly defined guidance provided in Attachment 1 of that 
standard.'' \34\ Accordingly, EEI/EPSA support approval of the two 
standards.
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    \32\ The three individuals are Mark Eliason, G. Wilkowski, and 
Daniel Shin.
    \33\ EEI/EPSA Comments at 2.
    \34\ Id.
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II. Discussion

    19. Pursuant to section 215(d)(2) of the FPA, we approve 
Reliability Standards PRC-025-1 and PRC-023-3 as just, reasonable, not 
unduly discriminatory or preferential, and in the public interest. 
Further, we approve the associated violation risk factors and violation 
severity levels, and NERC's

[[Page 42673]]

proposed implementation plans for the new and revised standards. PRC-
025-1 satisfies the Commission directive in Order No. 733 requiring 
NERC to develop a separate Reliability Standard that addresses 
generator step-up and auxiliary transformer loadability, and to do so 
``in a way that is coordinated with the Requirements and expected 
outcomes of PRC-023-1.'' \35\ In addition, we find that PRC-025-1 will 
enhance reliability by imposing mandatory requirements governing 
generator relay loadability settings, thereby reducing the likelihood 
of premature or unnecessary tripping of generators during system 
disturbances. Finally, we find that the modifications reflected in PRC-
023-3 will clarify the applicability of the two standards governing 
relay loadability and prevent potential compliance overlap due to 
inconsistencies.
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    \35\ See Order No. 733, 130 FERC ] 61,221 at PP 104-106.
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Other Issues

    20. The three individual commenters express support for the 
approval of PRC-025-1 and PRC-023-3, but raise certain additional 
concerns about the reliability of the grid. One commenter notes that, 
despite the increased costs associated with installation or adjustment 
of relays under the new Reliability Standards, the ``appropriate 
setting of protective relays will be helpful in the case of larger 
outages.'' \36\ Another commenter states that the standard ``will 
reduce the likelihood of premature or unnecessary tripping of 
generators during disturbances,'' but also opines on the general need 
for enhanced reliability standards due to, inter alia, proliferation of 
independent generation facilities, increased burdens on and risks to 
the grid due to increasing demand, climate change, and physical 
attacks.\37\ Another commenter, while supporting adoption of the rule, 
notes his larger concern with the security of the grid and the need to 
prevent physical attacks that could have a far-reaching effect on 
national security.\38\
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    \36\ Comments of Mark Eliason at 1.
    \37\ Comments of G. Wilkowski at 1-2.
    \38\ Comments of Daniel Shin at 1-2.
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Commission Determination

    21. For the reasons stated above, we approve Reliability Standards 
PRC-025-1 and PRC-023-3, and note that all comments relevant to the 
issues raised by our proposed approval of these Reliability Standards 
support our approval. With respect to the broader issues raised on the 
need to address other risks to reliability, including risks to the 
physical security of the grid, such issues are beyond the scope of the 
instant proceeding. However, we note that certain of these issues are 
being addressed in other pending Commission proceedings, and direct 
these commenters to Docket No. RM14-1-000, addressing Reliability 
Standards related to Geomagnetic Disturbances; and Docket No. RM14-15-
000, addressing the development of physical security Reliability 
Standards.

III. Information Collection Statement

    22. The collection of information contained in this Final Rule is 
subject to review by the Office of Management and Budget (OMB) under 
section 3507(d) of the Paperwork Reduction Act of 1995.\39\ OMB's 
regulations require approval of certain information collection 
requirements imposed by agency rules.\40\ Upon approval of a collection 
of information, OMB will assign an OMB control number and an expiration 
date. Respondents subject to the filing requirements of a rule will not 
be penalized for failing to respond to this collection of information 
unless the collections of information display a valid OMB control 
number.
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    \39\ 44 U.S.C. 3507(d) (2012).
    \40\ 5 CFR 1320.11 (2013).
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    23. Through issuance of this Final Rule, the Commission approves 
Reliability Standard PRC-025-1 and revisions to PRC-023-2. Reliability 
Standard PRC-025-1 will impose new requirements to set certain 
generator protective relays in accordance with prescribed criteria, and 
will apply to transmission owners, distribution providers, and 
generator owners with applicable relays. Affected entities will have to 
ensure that their relays are set in accordance with these criteria and 
maintain records or other evidence demonstrating their compliance with 
the standard's requirements. The revisions to PRC-023-2 will result in 
a change in how relay settings are calculated for certain kinds of 
relays, but will not result in reporting or recordkeeping requirements 
or burden. Public Reporting Burden: Reliability Standard PRC-025-1 does 
not require responsible entities to file information with the 
Commission. However, the Reliability Standard requires applicable 
entities to develop and maintain certain information, subject to audit 
by a Regional Entity. In particular, each applicable transmission 
owner, generator owner and distribution provider must ``have evidence'' 
to show that each of its load-responsive protective relays are set 
according to one of the options in Attachment 1 to Reliability Standard 
PRC-025-1. Our estimate below regarding the number of respondents is 
based on the NERC compliance registry as of January 31, 2014. According 
to the NERC compliance registry, NERC has registered 539 distribution 
providers, 903 generator owners and 344 transmission owners. However, 
under NERC's compliance registration program, entities may be 
registered for multiple functions, so these numbers incorporate some 
double counting. The number of unique entities responding will be 
approximately 1,019 \41\ entities registered as a transmission owner, a 
distribution provider, or a generator owner that is also a transmission 
owner and/or a distribution owner. The Commission estimates the annual 
reporting burden and cost as follows:
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    \41\ This estimate assumes all of the unique entities apply 
load-responsive protective relays.

                                              FERC-725G,\42\ Additions in Final Rule in RM13-19 and RM14-3
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                                                             Annual number
                                       Number and type of    of responses    Total number     Avg. burden & cost    Total annual burden      Cost per
                                      respondents \43\ (1)  per respondent   of responses      per response (3)     hours & total annual    respondent
                                                                  (2)                                                 cost (1)x(2)x(3)         \44\
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(One-time) Review & documentation    1,019 GO/DP/TO.......               1           1,019  20 hrs. & $59.62/hour  20,380 hours &                  $1192
 of relay settings to ensure                                                                                        $1,215,056.
 compliance.

[[Page 42674]]

 
(On-going) Record Retention (of      1,019 GO/DP/TO.......               1           1,019  2 hrs. & $28.95/hour.  2,038 hours &                  $57.90
 compliance records for R1 and M1,                                                                                 $59,000..............
 for 3 years or until mitigation
 complete).
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    Title: Mandatory Reliability Standards for the Bulk-Power System
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    \42\ At the time the Notice of Proposed Rulemaking was issued, 
an unrelated rulemaking affecting other aspects of FERC-725G was 
pending at OMB for PRA review. Because only one request per OMB 
Control Number can be pending OMB review at a time, the information 
collection proposed in this NOPR (RM13-19 and RM14-3) was 
temporarily labeled FERC 725Q (OMB Control No. 1902-0272). The 
reporting and record retention requirements for this Final Rule in 
RM13-19 and RM14-3 are now being submitted to OMB for review under 
FERC 725G (rather than the temporary FERC 725Q).
    \43\ GO = Generator Owner, DP = Distribution Provider, TO = 
Transmission Owner, each of which applies load-responsive protective 
relays at the terminals of the Elements listed in the proposed 
standard at section 3.2(Facilities).
    \44\ The estimated hourly costs (salary plus benefits) are based 
on Bureau of Labor Statistics (BLS) information (at http://bls.gov/oes/current/naics3_221000.htm#17-0000) for an electrical engineer 
($59.62/hour for review and documentation), and for a file clerk 
($28.95/hour for record retention).
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    Action: Changes to FERC-725G.
    OMB Control No: 1902-0252
    Respondents: Businesses or other for-profit institutions; not-for-
profit institutions.
    Frequency of Responses: One-time and ongoing.
    Necessity of the Information: Generator Relay Loadability 
Reliability Standard (PRC-025-1) would implement the Congressional 
mandate of the Energy Policy Act of 2005 to develop mandatory and 
enforceable Reliability Standards to better ensure the reliability of 
the nation's Bulk-Power System. Specifically, the purpose of the 
Reliability Standard is to set load-responsive protective relays 
associated with generation facilities at a level to prevent unnecessary 
tripping of generators during a system disturbance for conditions that 
do not pose a risk of damage to the associated equipment. The 
Reliability Standard requires entities to maintain records subject to 
review by the Commission and NERC to ensure compliance with the 
Reliability Standard.
    Internal Review: The Commission has reviewed the requirements 
pertaining to the Reliability Standards PRC-025-1 and PRC-023-3 and 
determined that the proposed requirements are necessary to meet the 
statutory provisions of the Energy Policy Act of 2005. These 
requirements conform to the Commission's plan for efficient information 
collection, communication and management within the energy industry. 
The Commission has assured itself, by means of internal review, that 
there is specific, objective support for the burden estimates 
associated with the information requirements.
    24. Interested persons may obtain information on the reporting 
requirements by contacting the following: Federal Energy Regulatory 
Commission, 888 First Street NE., Washington, DC 20426 [Attention: 
Ellen Brown, Office of the Executive Director, email: 
DataClearance@ferc.gov, phone: (202) 502-8663, fax: (202) 273-0873].
    25. Comments concerning the information collections proposed in 
this rule and the associated burden estimates should be sent to the 
Commission in these dockets and to the Office of Management and Budget, 
Office of Information and Regulatory Affairs [Attention: Desk Officer 
for the Federal Energy Regulatory Commission]. For security reasons, 
comments should be sent by email to OMB at: oira_submission@omb.eop.gov. Please reference FERC-725G, OMB Control No. 
1902-0252, and Docket Nos. RM13-19-000 and RM14-3-000 in your 
submission.

IV. Regulatory Flexibility Act Certification

    26. The Regulatory Flexibility Act of 1980 (RFA) \45\ generally 
requires a description and analysis of rules that will have significant 
economic impact on a substantial number of small entities. The RFA 
mandates consideration of regulatory alternatives that accomplish the 
stated objectives of a proposed rule and that minimize any significant 
economic impact on a substantial number of small entities. The Small 
Business Administration's (SBA) Office of Size Standards develops the 
numerical definition of a small business.\46\ The SBA recently revised 
its size standard for electric utilities (effective January 22, 2014) 
to a standard based on the number of employees, including affiliates 
(from a standard based on megawatt hours).\47\ Under SBA's new size 
standards, generator owners, distribution providers, and transmission 
owners are likely included in one of the following categories (with the 
associated size thresholds noted for each): \48\
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    \45\ 5 U.S.C. 601-612 (2012).
    \46\ 13 CFR 121.101 (2013).
    \47\ Small Business Size Standards: Utilities, 78 FR 77,343 
(Dec. 23, 2013).
    \48\ 13 CFR 121.201, Sector 22, Utilities.
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     Hydroelectric power generation, at 500 employees;
     Fossil fuel electric power generation, at 750 employees;
     Nuclear power generation, at 750 employees;
     Other electric power generation (e.g. solar, wind, 
geothermal, and others), at 250 employees;
     Electric bulk power transmission and control, at 500 
employees;
     Electric power distribution, at 1,000 employees.
    27. Based on U.S. economic census data,\49\ the approximate 
percentage of small firms in these categories varies from 24 percent to 
94 percent. However, currently FERC does not have information on how 
the economic census data compares with entities registered with NERC 
and is unable to estimate the number of small GOs, DPs, and TOs using 
the new SBA definitions.\50\ Regardless, FERC recognizes that the rule 
will likely impact small GOs, DPs, and TOs and estimates the economic 
impact on each entity below.
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    \49\ Data and further information are available from SBA at 
http://www.sba.gov/advocacy/849/12162.
    \50\ Using the previous SBA definition, 230 of the 1,019 
entities affected by the proposed PRC-025-1 would have qualified as 
small entities.
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    28. Reliability Standard PRC-025-1 will serve to enhance 
reliability by

[[Page 42675]]

imposing mandatory requirements governing generator relay loadability, 
thereby reducing the likelihood of premature or unnecessary tripping of 
generators during system disturbances. The Commission estimates that 
each of the small entities to whom the Reliability Standard PRC-025-1 
applies will incur one-time compliance costs of $4,480 (i.e., the cost 
of re-setting any relays found to be out of compliance),\51\ plus 
paperwork and record retention costs of $1,192 (one-time 
implementation) and $57.90 (annual ongoing).\52\ Per entity, the total 
one-time implementation costs are estimated to be $5,672 (including 
paperwork and non-paperwork costs) and the annual ongoing costs are 
estimated to be $57.90.
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    \51\ These are non-paperwork related costs, which are not 
reflected in the burden described in the Information Collection 
Section above, and instead reflect the burden of re-setting relays 
in order to comply with the new requirements of PRC-025-1. 
Specifically, this figure reflects an estimated time of 8 hours per 
relay, assuming an average of 8 digital relays which will need to be 
re-set per small entity, at a cost of $70 per hour (the average of 
the salary plus benefits for a manager and an engineer, from Bureau 
of Labor Statistics at http://bls.gov/oes/current/naics3_221000.htm 
and http://www.bls.gov/news.release/ecec.nr0.htm).
    \52\ The one-time paperwork-related implementation cost estimate 
is based on a burden of 20 hours at $59.62/hour, and the annual 
record-keeping cost estimate is based on a burden of 2 hours at 
$28.95/hour. See supra at P 23 and n.44.
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    29. The Commission does not consider the estimated costs per small 
entity to have a significant economic impact on a substantial number of 
small entities. Accordingly, the Commission certifies that this rule 
will not have a significant economic impact on a substantial number of 
small entities.

V. Environmental Analysis

    30. The Commission is required to prepare an Environmental 
Assessment or an Environmental Impact Statement for any action that may 
have a significant adverse effect on the human environment.\53\ The 
Commission has categorically excluded certain actions from this 
requirement as not having a significant effect on the human 
environment. Included in the exclusion are rules that are clarifying, 
corrective, or procedural or that do not substantially change the 
effect of the regulations being amended.\54\ The actions taken herein 
fall within this categorical exclusion in the Commission's regulations.
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    \53\ Regulations Implementing the National Environmental Policy 
Act of 1969, Order No. 486, FERC Stats. & Regs. ] 30,783 (1987).
    \54\ 18 CFR 380.4(a)(2)(ii).
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VI. Document Availability

    31. In addition to publishing the full text of this document in the 
Federal Register, the Commission provides all interested persons an 
opportunity to view and/or print the contents of this document via the 
Internet through the Commission's Home Page (http://www.ferc.gov) and 
in the Commission's Public Reference Room during normal business hours 
(8:30 a.m. to 5:00 p.m. Eastern time) at 888 First Street, NE., Room 
2A, Washington, DC 20426.
    32. From the Commission's Home Page on the Internet, this 
information is available on eLibrary. The full text of this document is 
available on eLibrary in PDF and Microsoft Word format for viewing, 
printing, and/or downloading. To access this document in eLibrary, type 
the docket number excluding the last three digits of this document in 
the docket number field.
    33. User assistance is available for eLibrary and the Commission's 
Web site during normal business hours from the Commission's Online 
Support at 202-502-6652 (toll free at 1-866-208-3676) or email at 
ferconlinesupport@ferc.gov, or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at 
public.referenceroom@ferc.gov.

VII. Effective Date and Congressional Notification

    34. This Final Rule is effective September 22, 2014.
    35. The Commission has determined, with the concurrence of the 
Administrator of the Office of Information and Regulatory Affairs of 
OMB, that this rule is not a ``major rule'' as defined in section 351 
of the Small Business Regulatory Enforcement Fairness Act of 1996.\55\ 
The Commission will submit the Final Rule to both houses of Congress 
and to the General Accountability Office.
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    \55\ See 5 U.S.C. 804(2).

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    By the Commission.

    Issued: July 17, 2014.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2014-17229 Filed 7-22-14; 8:45 am]
BILLING CODE 6717-01-P