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Mandatory Reliability StandardsConsultation

October 10, 2008

This information has been prepared solely for the purpose of facilitating discussion and is based on information available to BCTC as of the date sent. BCTC does not warrant the accuracy of the information, and it should not be relied upon for any other purpose.


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Purpose of Meeting

  • To clarify BCTC’s role regarding Mandatory Reliability Standards.

  • To share information about the areas where reliability standards apply and to whom they may be applicable.

  • To provide an overview of standards for Generator Owners, Generator Operators, Transmission Owners, and Distribution Providers.

  • To answer questions that have arisen in filling out the cost information in the Survey Form.


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Agenda

8:30 am Session 1

Overview and Status of Regulatory Framework in BC (All Functional Groups)

Functional Model and Criteria (All Functional Groups)

Standards Review and Applicability (GO / GOP)

Review and Discuss Desired Stakeholder Input (GO / GOP)

10:45 am BREAK

11:00 am Session 2

Standards Review and Applicability (TO / DP)

Review and Discuss Desired Stakeholder Input (TO / DP)

Functional Groups:

Generator Owners (GO) Transmission Owner (TO)

Generator Operators (GOP) Distribution Provider (DP)


2003 northeast blackout l.jpg

Affected approximately 50 million people in Canada and the U.S. with an estimated economic impact of between $4 and $10 billion.

President George Bush and Prime Minister Jean Chrétien established a Joint Canada–U.S. System Outage Task Force.

The final Task Force Report recommended the need for making reliability standards mandatory and enforceable.

2003 Northeast Blackout

New York in the dark 2003


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Response to U.S. with an estimated economic impact of between $4 and $10 billion.Task Force Report

  • The U.S. Energy Policy Act of 2005 required the creation of an Electricity Reliability Organization (ERO) and the implementation of mandatory reliability standards. It also gave FERC jurisdiction over the ERO and over the development and implementation of these reliability standards.

  • In 2006, NERC was certified as the ERO in the US.

  • Canadian Council of Energy Ministers committed to ensuring means in place to implement and enforce reliability in all jurisdictions that interconnect with US transmission grid.

  • In 2007, compliance with approved NERC Reliability Standards becomes mandatory and enforceable in the United States.


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Mandatory Reliability Standards in BC U.S. with an estimated economic impact of between $4 and $10 billion.

  • The 2007 BC Energy Plan commits to remaining consistent with North American reliability standards.

    Policy Action 14: Ensure that the province remains consistent with North American transmission reliability standards


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Mandatory Reliability Standards in BC U.S. with an estimated economic impact of between $4 and $10 billion.

  • Amendments to Utilities Commission Act (UCA) in 2008 requires

  • BCTC to prepare a public Assessment Report regarding Mandatory Reliability Standards that have been adopted by NERC/WECC and are enforceable in the US.

  • As part of preparing the Assessment Report, BCTC is seeking input from potentially impacted entities on the cost of complying with NERC/WECC reliability standards if adopted in BC.

  • The British Columbia Utilities Commission (BCUC) is required to adopt the MRS included in the report unless the BCUC determines it is not in the public interest to do so.

  • MRS will apply to “prescribed” BC entities. Government has not yet passed a regulation prescribing those entities.


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Agenda U.S. with an estimated economic impact of between $4 and $10 billion.

8:30 am Session 1

Overview and Status of Regulatory Framework in BC (All Functional Groups)

Functional Model and Criteria (All Functional Groups)

Standards Review and Applicability (GO / GOP)

Review and Discuss Desired Stakeholder Input (GO / GOP)

10:45 am BREAK

11:00 am Session 2

Standards Review and Applicability (TO / DP)

Review and Discuss Desired Stakeholder Input (TO / DP)

Functional Groups:

Generator Owners (GO) Transmission Owner (TO)

Generator Operators (GOP) Distribution Provider (DP)


Overview l.jpg
Overview U.S. with an estimated economic impact of between $4 and $10 billion.

1. What areas do reliability standards cover?

An overview of reliability standards

2. What reliability standards are applicable to whom?

An overview of the NERC functional model


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What areas do the reliability standards cover? U.S. with an estimated economic impact of between $4 and $10 billion.

NERC Reliability Standards Overview


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Reliability Standards Definition U.S. with an estimated economic impact of between $4 and $10 billion.

  • A reliability standard is defined as follows:

    “Reliability standard” means a requirement to provide for reliable operation of the bulk power system, including without limiting the foregoing, requirements for the operation of existing bulk power system facilities, including cyber security protection, and including the design of planned additions or modifications to such facilities to the extent necessary for reliable operation of the bulk power system; but shall not include any requirement to enlarge bulk power system facilities or to construct new transmission capacity or generation capacity.”


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Bulk Electric System Definition U.S. with an estimated economic impact of between $4 and $10 billion.

  • As defined by the Regional Reliability Organization, the

  • electrical generation resources, transmission lines,

  • interconnections with neighboring systems, and

  • associated equipment, generally operated at voltages of

  • 100 kV or higher. Radial transmission facilities serving

  • only load with one transmission source are generally

  • not included in this definition.

  • Note: Radial transmission facilities >200Kv are subject to the vegetation management reliability standards


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Reliability Standards Domains U.S. with an estimated economic impact of between $4 and $10 billion.

  • Resource and Demand Balancing (BAL)

  • Communications (COM)

  • Critical Infrastructure Protection (CIP)

  • Emergency Preparedness and Operations (EOP)

  • Facilities Design, Connections and Maintenance (FAC)

  • Interchange Scheduling and Coordination (INT)

  • Interconnection Reliability Operations and Coordination (IRO)

  • Modeling, Data and Analysis (MOD)

  • Nuclear (NUC)

  • Personnel Performance, Training and Qualifications (PER)

  • Protection and Control (PRC)

  • Transmission Operations (TOP)

  • Transmission Planning (TPL)

  • Voltage and Reactive (VAR)


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What standards are applicable to whom? U.S. with an estimated economic impact of between $4 and $10 billion.

An Overview of the NERC Functional Model


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Overview U.S. with an estimated economic impact of between $4 and $10 billion.NERC Functional Model

  • The NERC Reliability Functional Model provides the framework for the development and applicability of NERC’s Reliability Standards, as follows:

    • The Model describes a set of Functions that are performed to ensure the reliability of the bulk power system. The Model also describes the interrelationships between that Responsible Entity and other Responsible Entities

    • NERC’s Standards Development Teams develop Reliability Standards that assign each reliability requirement within a standard to a Responsible Entity

    • The Model’s Functions and Responsible Entities also provide for consistency and compatibility among different Reliability Standards

  • The Model is a guideline for the development of standards and their applicability, it is not a NERC requirement.


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Overview U.S. with an estimated economic impact of between $4 and $10 billion.NERC Functional Model


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Function Description GO/GOP/TO/DP U.S. with an estimated economic impact of between $4 and $10 billion.

  • Generator Owner (GO)

    Entity that owns and maintains generating units.

  • Generator Operator (GOP)

    The entity that operates generating unit(s) and performs the functions of supplying energy and interconnected operations services.

  • Transmission Owner (TO)

    The entity that owns and maintains transmission facilities.

  • Distribution Provider (DP)

    Provides and operates the “wires” between the transmission system and the end-use customer. For those end-use customers who are served at transmission voltages, the Transmission Owner also serves as the DP. Thus, the DP is not defined by a specific voltage, but rather as performing the Distribution function at any voltage.


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Criteria Used to Determine an Entity’s Function U.S. with an estimated economic impact of between $4 and $10 billion.

  • Entities meeting the functional entity definitions outlined on previous slides are candidates for registration

  • NERC Compliance Registry Criteria version 4 specifies criteria that limit the number of LSE (Load Serving Entity), DP, GO, GOP, TO, or TOP (Transmission Operator) candidates subject to reliability standards.

  • In BC, the Regulation will take the place of the NERC Compliance Registry Criteria in limiting the number of candidates to whom reliability standards apply.


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Mapping of Standards to Functions U.S. with an estimated economic impact of between $4 and $10 billion.


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Standards included in Assessment Report U.S. with an estimated economic impact of between $4 and $10 billion.

  • There are 94 NERC standards approved by FERC and 8 WECC standards approved by FERC that are being proposed in the initial Assessment Report

    • Not all standards are applicable to each function (entity)

    • Many standards relate to requirements that are already in existing (interconnection) agreements


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Transfer of Responsibility U.S. with an estimated economic impact of between $4 and $10 billion.

  • In the US, NERC’s model allows for responsibilities to be transferred through an agreement.

  • If all the requirements related to a function are transferred through an agreement to another party, and the other party registers for the respective function, then the responsibility can be transferred.

  • If only part of the responsibilities are transferred through an agreement then both organizations need to register for the function.

  • In BC, the answer to this question will depend on the nature of the regulation and/or compliance monitoring program put in place by the BCUC.


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Summary Functional Model U.S. with an estimated economic impact of between $4 and $10 billion.

  • Functional model identifies the function an entity fulfills

  • The function is then used to identify the standards that are applicable

    • Final determination of an entity’s role will be made by BCUC


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Agenda U.S. with an estimated economic impact of between $4 and $10 billion.

8:30 am Session 1

Overview and Status of Regulatory Framework in BC (All Functional Groups)

Functional Model and Criteria (All Functional Groups)

Standards Review and Applicability (GO / GOP)

Review and Discuss Desired Stakeholder Input (GO / GOP)

10:45 am BREAK

11:00 am Session 2

Standards Review and Applicability (TO / DP)

Review and Discuss Desired Stakeholder Input (TO / DP)

Functional Groups:

Generator Owners (GO) Transmission Owner (TO)

Generator Operators (GOP) Distribution Provider (DP)


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What reliability standards are applicable to Generator Owner (GO) / Generator Operator (GOP)?

An overview of GO/GOP standards


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Entities that are Potential Candidates (GO) / Generator Operator (GOP)?

  • Reliability standards apply to every prescribed owner, operator and direct user of the bulk power system and prescribed generator and distributor of electricity (Utilities Commission Act)

  • Entities that fit the function description of the functional model (NERC glossary)

    • Generator Owner (GO)

      Entity that owns and maintains generating units.

    • Generator Operator (GOP)

      The entity that operates generating unit(s) and performs the functions of supplying energy and interconnected operations services.


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Additional GO/GOP Qualification Criteria Used by NERC (GO) / Generator Operator (GOP)?

  • 3. Potential candidates are included if they meet any of the criteria below:

    • Individual generating unit > 20 MVA directly connected to the bulk power system, or

    • Generating plant/facility > 75 MVA or when the entity has responsibility for any facility consisting of one or more units that are connected to the bulk power system at a common bus with total generation above 75 MVA; or

    • Any generator, regardless of size, that is a black start unit material to, and designated as part of, a transmission operator entity’s restoration plan; or

    • Any generator, regardless of size, that is determined to be material to the reliability of the bulk power system.


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Additional GO/GOP Qualification Criteria Used by NERC (GO) / Generator Operator (GOP)?

Exclusions:

  • A generator owner/operator will be exempted if effective control and responsibility for maintenance and operation of the generator/generation have been transferred by acceptable contract to another party, and the other entity has registered for the respective function.

  • Generally, a customer-owned or operated generator/generation that serves all or part of retail load with electric energy on the customer side of the retail meter may be excluded if:

    • The net capacity provided to the bulk power system does not exceed the criteria above or the Regional Entity otherwise determines the generator is not material to the bulk power system; and

    • Standby, back-up and maintenance power services are provided to the generator or to the retail load pursuant to a binding obligation with another generator owner/operator under terms approved by the local regulatory authority


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Summary Overview of GO/GOP Standards (GO) / Generator Operator (GOP)?

  • GO: 22 reliability standards *

  • GOP: 24 reliability standards *

  • GO/GOP: 35 reliability standards *

    • 23 of these standards apply already under existing agreements

    • 7 of these standards relate to NERC CIP standards and are likely not applicable to the IPP’s as they are today based on thresholds identified in CIP-002

    • Thus, only 5 of the above standards are “new”

* This includes 7 NERC CIP standards that may not be applicable

dependent on criteria in CIP-002


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Nature of “NEW” GO/GOP standards (GO) / Generator Operator (GOP)?

  • CIP-001:Generator Operators will have in place procedures to recognize and respond to sabotage events and report any disturbances or unusual occurrences suspected to be sabotage to appropriate authorities

  • CIP-002: Requirement for a documented methodology to identify critical and critical cyber assets by GO/GOP

  • EOP-004: This standard requires a GO to analyze any disturbances on their system (e.g. if their generator trips off, to find out why) and may be asked to provide information to BCTC in a timely fashion. This may be required in some specific IA's but is generally done today as part of good utility practice.

  • EOP-009: This standard is not currently applicable to any IPPs (e.g. they are not designated as blackstart generators in BCTC's system restoration plan). If a GO/GOP was required to provide blackstart capability, this would be a negotiated agreement.

  • PRC-018: Effectively not required as it relies on PRC-002 which is not part of the standards proposed to be adopted.


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Agenda (GO) / Generator Operator (GOP)?

8:30 am Session 1

Overview and Status of Regulatory Framework in BC (All Functional Groups)

Functional Model and Criteria (All Functional Groups)

Standards Review and Applicability (GO / GOP)

Review and Discuss Desired Stakeholder Input (GO / GOP)

10:45 am BREAK

11:00 am Session 2

Standards Review and Applicability (TO / DP)

Review and Discuss Desired Stakeholder Input (TO / DP)

Functional Groups:

Generator Owners (GO) Transmission Owner (TO)

Generator Operators (GOP) Distribution Provider (DP)


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What input is expected from you? (GO) / Generator Operator (GOP)?

Overview of data gathering method and timelines


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Information Gathering (GO) / Generator Operator (GOP)?

  • As per legislation BCTC is required to prepare an Assessment Report that evaluates, among other factors, the cost of adopting the standards in the province of BC

  • BCTC is seeking input from stakeholders that can be considered in the Assessment Report


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Information Gathering Format (GO) / Generator Operator (GOP)?

  • Tab 1: Instructions

  • Tab 2: Information gathering

    • Validate your entity’s function against the functional model and related criteria

    • Estimated costs/implications of implementation for applicable standards

      [in particular for “new” standards and validate that “existing” standards is indeed already an obligation]

    • Identification of any exceptional on-going costs

    • Assumptions


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Timelines and Questions (GO) / Generator Operator (GOP)?

  • Return of surveys by October 24th 2008 to

  • Brenda.Ambrosi@bctc.com

  • Questions regarding the survey or standards, contact

  • Brenda.Ambrosi@bctc.com or 604-699-7391


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Additional Information (GO) / Generator Operator (GOP)?

  • All information is available on www.nerc.com, including

  • NERC standards including detailed requirements:

  • http://www.nerc.com/page.php?cid=2|20

  • NERC Glossary:

  • http://www.nerc.com/files/Glossary_12Feb08.pdf

  • NERC Compliance Registry Criteria:

  • http://www.nerc.com/files/Statement_of_Compliance_Registry_Criteria_V4-0.pdf

  • NERC Functional Model:

  • http://www.nerc.com/page.php?cid=2%7C247%7C108


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Agenda (GO) / Generator Operator (GOP)?

8:30 am Session 1

Overview and Status of Regulatory Framework in BC (All Functional Groups)

Functional Model and Criteria (All Functional Groups)

Standards Review and Applicability (GO / GOP)

Review and Discuss Desired Stakeholder Input (GO / GOP)

10:45 am BREAK

11:00 am Session 2

Standards Review and Applicability (TO / DP)

Review and Discuss Desired Stakeholder Input (TO / DP)

Functional Groups:

Generator Owners (GO) Transmission Owner (TO)

Generator Operators (GOP) Distribution Provider (DP)


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Agenda (GO) / Generator Operator (GOP)?

8:30 am Session 1

Overview and Status of Regulatory Framework in BC (All Functional Groups)

Functional Model and Criteria (All Functional Groups)

Standards Review and Applicability (GO / GOP)

Review and Discuss Desired Stakeholder Input (GO / GOP)

10:45 am BREAK

11:00 am Session 2

Standards Review and Applicability (TO / DP)

Review and Discuss Desired Stakeholder Input (TO / DP)

Functional Groups:

Generator Owners (GO) Transmission Owner (TO)

Generator Operators (GOP) Distribution Provider (DP)


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What reliability standards are applicable to Transmission Owners (TO)?

An overview of TO standards


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Entities that are Potential Candidates Owners (TO)?

  • Reliability standards apply to every prescribed owner, operator and direct user of the bulk power system and prescribed generator and distributor of electricity (Utilities Commission Act)

  • Entities that fit the function description of the functional model (NERC glossary)

    • Transmission Owner (TO)

      The entity that owns and maintains transmission facilities.


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Additional TO Qualification Criteria Used by NERC Owners (TO)?

3. Potential candidates are included if they meet any of the criteria

below:

  • An entity that owns/operates an integrated transmission element associated with the bulk power system 100 kV and above, or lower voltage as defined by the Regional Entity necessary to provide for the reliable operation of the interconnected transmission grid; or

  • An entity that owns/operates a transmission element below 100 kV associated with a facility that is included on a critical facilities list that is defined by the Regional Entity.

    Exclusion: A TO will be exempted if effective control and responsibility for maintenance and operation of the generator/generation have been transferred by acceptable contract to another party, and the other entity has registered for the respective function.


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Summary Overview of TO Standards Owners (TO)?

  • TO: 31 reliability standards *

    • 20 of these standards already apply under existing agreements

    • 7 of these standards relate to NERC CIP standards and are likely not applicable to the TO’s as they are today based on thresholds identified in CIP-002

    • Thus, only 4 of the above standards are “new”

* This includes 7 NERC CIP standards that may not be applicable

dependent on criteria in CIP-002


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Nature of “NEW” standards Owners (TO)?

  • CIP-002: Requirement for a documented methodology to identify critical and critical cyber assets

  • FAC-001: Transmission owners shall document, maintain and publish facility connection requirements to ensure compliance with NERC reliability standards and applicable RRO, subregional, Power Pool or Transmission Owner's faculties planning criteria and facility connection requirements.

  • FAC-003: The Transmission owner shall prepare and keep current a formal transmission vegetation management program that includes the TO's objectives, practices, approved procedures and work specifications. [FAC-003 is primarily applicable for facilities >200Kv]

  • PRC-018: Effectively not required as it relies on PRC-002 which is not part of the standards proposed to be adopted.


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What reliability standards are applicable to Distribution Providers (DP)?

An overview of DP standards


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Entities that are Candidates Providers (DP)?

  • Reliability standards apply to every prescribed owner, operator and direct user of the bulk power system and prescribed generator and distributor of electricity (Utilities Commission Act)

  • Entities that fit the function description of the functional model (NERC glossary)

    • Distribution Provider (DP)

      Provides and operates the “wires” between the transmission system and the end-use customer. For those end-use customers who are served at transmission voltages, the Transmission Owner also serves as the DP. Thus, the DP is not defined by a specific voltage, but rather as performing the Distribution function at any voltage.


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Additional DP Qualification Criteria Used by NERC Providers (DP)?

  • 3. Potential candidates are included if they meet any of the criteria below:

    • Distribution provider system serving >25 MW of peak load that is directly connected to the bulk power system; or

    • Distribution provider is the responsible entity that owns, controls, or operates facilities that are part of any of the following protection systems or programs designed, installed, and operated for the protection of the bulk power system:

      • a required UFLS program.

      • a required UVLS program.

      • a required special protection system.

      • a required transmission protection system.

        Exclusion: A DP will be exempted if effective control and responsibility for maintenance and operation of the generator/generation have been transferred by acceptable contract to another party, and the other entity has registered for the respective function.


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Summary Overview of DP Standards Providers (DP)?

  • DP: 14 reliability standards

    • For those entities that are a Transmission Owner (TO), there are only 2 additional standards


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Additional DP Standards Compared to TO Providers (DP)?

  • PRC-022: Under-Voltage Load Shedding Program Performance, which has a requirement to analyze, document and make available within 90 days upon request documentation of all UVLS operations and misoperations.

  • TOP-001: Each Distribution Provider and Load Serving Entity shall comply with all reliability directives issued by the Transmission Operator, including shedding firm load, unless such actions would violate safety, equipment, regulatory or statutory requirements. Under these circumstances, the Distribution Provider or Load Serving Entity shall immediately inform the Transmission Operator of the inability to perform the directive so that the Transmission Operator can implement alternate remedial actions.


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Agenda Providers (DP)?

8:30 am Session 1

Overview and Status of Regulatory Framework in BC (All Functional Groups)

Functional Model and Criteria (All Functional Groups)

Standards Review and Applicability (GO / GOP)

Review and Discuss Desired Stakeholder Input (GO / GOP)

10:45 am BREAK

11:00 am Session 2

Standards Review and Applicability (TO / DP)

Review and Discuss Desired Stakeholder Input (TO / DP)

Functional Groups:

Generator Owners (GO) Transmission Owner (TO)

Generator Operators (GOP) Distribution Provider (DP)


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What input is expected from you? Providers (DP)?

Overview of data gathering method and timelines


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Information Gathering Providers (DP)?

  • As per legislation BCTC is required to prepare an Assessment Report that evaluates among other factors the cost of adopting the standards in the province of BC

  • BCTC is seeking input from stakeholders that can be considered in the Assessment Report


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Information Gathering Format Providers (DP)?

  • Tab 1: Instructions

  • Tab 2: Information gathering

    • Validate your entity’s function against the functional model and related criteria

    • Estimated costs/implications of implementation for applicable standards

      [in particular for “new” standards and validate that “existing” standards is indeed already an obligation]

    • Identification of any exceptional on-going costs

    • Assumptions


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Timelines and Questions Providers (DP)?

  • Return of surveys by October 24th 2008 to

  • Brenda.Ambrosi@bctc.com

  • Questions regarding the survey or standards, contact

  • Brenda.Ambrosi@bctc.com or 604-699-7391


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Summary and Next Steps Providers (DP)?


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Summary on Reliability Standards Providers (DP)?

  • The NERC functional model is used to determine an entity’s function (e.g. GO, GOP, TO, DP)

  • There are limiting criteria (US - NERC Statement of Compliance Registry Criteria/ BC - regulation)

  • Based on the functional model and limiting criteria a set of standards is applicable to an entity

  • BCTC will analyze FERC-approved standards and provide an Assessment Report to BCUC

  • Per UCA, BCUC will approve unless not in the public interest

  • Your input for the Assessment Report will be appreciated and considered if sent to BCTC by November 14, 2008.


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Next Steps Providers (DP)?

  • Initial set of reliability standards:

    • Gather the input from different stakeholders for the Assessment Report

    • BCTC will prepare an Assessment Report for BCUC and file the report with BCUC

    • BCUC will determine the process required to adopt the standards

    • BCUC adopts or rejects the standards