Regional Criteria Task Force - Update

1. Regional Criteria Task Force - Update RPIC MeetingLoveland, COJuly 29, 2009

2. Task Force Participants • Andrew Gallo, Seattle City Light • Vicken Kasarjian, SMUD • David Lemmons, Xcel Energy Services • Brian Theaker, Dynegy • Donald Watkins, BPA

3. Task • How should WECC address the fact that some Regional Criteria do not lead to sanctions, while others -- if created pursuant to a “fill-in-the-blanks” (FITB) reliability standard -- may lead to sanctions

4. Considerations • A new WECC document type should be avoided • Technically, no Regional Criteria, in-and-of themselves, lead to penalties/sanctions • i.e. the failure to follow a Regional Criteria will not lead to penalties/sanctions • BUT, failure to follow a Regional Criterion may lead to sanctions for violation of a Reliability Standard

5. Issues • What document type should be used to “fill in the blanks” • What process should be used to develop the documents that “fill in the blanks” • If Regional Criteria are used, how does WECC ensure that someone reading a Regional Criterion will know the difference between those that may lead to sanctions and those that will not

6. Conclusions • Issue 1: What document type should be used to “fill in the blanks” • Regional Criteria are defined as Board-approved WECC documents, "whose purpose is to establish mandatory rules which must be followed by all entities within the interconnection in order to maintain reliability“ • All entities in the interconnection must follow the FITB Reliability Standards • Consequently, "Regional Criteria" are the proper document type for fulfilling the FITB Reliability standards

7. Conclusions (cont’d) • Issue 2: What process should be used to develop the documents that “fill in the blanks” • The full Standards Development Process (SDP) • The SDP ensures that everyone affected by the Regional Criterion will get notice and an opportunity to comment on it (i.e. due process)

8. Conclusions (cont’d) • Issue 3: How to ensure that someone reading Regional Criteria will know the difference between those that may lead to sanctions and those that will not • Include disclosure language in the "Introduction" of the Regional Criteria • For example: "This Regional Criterion was developed pursuant to North American Electric Reliability Corporation (NERC) Reliability Standard XXX-XXX-X, Requirement X and, as such, may lead to penalties or sanctions for violation of that Reliability Standard if not followed."

9. Motion • RPIC recommends that the Board adopt a policy that the documents that “fill in” the “Fill-In-The-Blank” Reliability Standards be tagged as Regional Criteria and include in the introduction the following statement: "This Regional Criterion was developed pursuant to North American Electric Reliability Corporation (NERC) Reliability Standard XXX-XXX-X, Requirement X and, as such, may lead to penalties or sanctions for violation of that Reliability Standard if not followed."

10. One Final Concern…. • Some Regional Criteria (not those developed pursuant to FITB standards) deal with “weighty” topics yet carry no penalty for failure to comply • The group sees this as a potential problem • i.e. if the subject matter of a Regional Criterion is important enough to go through the SDP, it must be a very important issue; but, a member could ignore/violate the Regional Criterion and suffer no adverse consequence • We didn’t solve this one…….

11. Questions?