16 U.S.C. § 824o : US Code - Section 824O: Electric reliability

Search 16 U.S.C. § 824o : US Code - Section 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) of this section 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) of this
section.
(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) of this section, any regional entities, and all users, owners
and operators of the 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) of this section, 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) of this section, 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) of this section (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.
(6) The final rule adopted under subsection (b)(2) of this
section 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) of this section 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) of this section; 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) of this section; and
(C) the agreement promotes effective and efficient
administration of bulk-power system reliability.
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) of this
section.
(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 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.