NERC Case Notes: Reliability Standard BAL-004-WECC-1 | White & Case LLP International Law Firm, Global Law Practice
NERC Case Notes: Reliability Standard BAL-004-WECC-1

NERC Case Notes: Reliability Standard BAL-004-WECC-1

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Public Service Company of Colorado (PSCO), Docket No. NP12-26-000 (April 30, 2012)

Reliability Standard: BAL-004-WECC-01

Requirement: R2

Violation Risk Factor: Lower

Violation Severity Level: Lower

Region: WECC

Issue: PSCO, as a BA, submitted a self-report detailing a violation of the Regional Standard based upon its failure to operate its Automatic Generation Control (AGC) on Tie Line Frequency Bias, when such operation would not have been adverse to system or Interconnection reliability. In particular, during an internal investigation, it was found that the EMS operating mode was mistakenly toggled from Tie Line Bias with Automatic Time Error Correction (ATEC) to Flat Interchange Mode (Flat Tie), which disabled the ATEC. The ATEC was disabled for approximately 46 hours before operators discovered and fixed the problem. During the relevant time period, PSCO was synchronously connected to the Western Interconnection but as it was unaware of the condition, it did not notify all other BAs of the operating mode through WECC Net, the designated Interconnection communication system.

Finding: The violation was found to pose minimal risk to BPS reliability because during the relevant time period, automatic payback by PSCO to the system would not have happened as PSCO was not operating in AGC mode. AGC can handle automatic inadvertent payback and Time Error Correction; therefore, the PSCO’s mistaken account would not have been minimized during the violation, as it would have been if the ATEC had been in service and automatic payback to the system was occurring. In determining the appropriate penalty, PSCO’s internal compliance program was considered a mitigating factor and credit was given for the self-report.

Penalty: $50,000 (aggregate for 5 violations)

FERC Order: Order issued May 30, 2012 (no further review)

Public Service Company of New Mexico (PNM), Docket No. NP12-47-000 (September 28, 2012)

Reliability Standard: BAL-004-WECC-01

Requirement: 1/1.1

Violation Risk Factor: Lower

Violation Severity Level: Severe

Region: WECC

Issue: In response to a Notice of Self-Certification for CY 2010 issued by WECC, PNM, a BA in the Western Interconnection, submitted a Self-Certification citing noncompliance with BAL-004-WECC-01 R1 and disclosing that it miscalculated the Primary Inadvertent Interchange (PII). PNM also stated that that the hourly change in system Time Error as distributed by the Interconnection Time Monitor (?TE) values became "stuck from time to time."

Following that, WECC gave notice of an On-site Compliance Audit to occur from May 31, 2011 through June 10, 2011. The Audit Team found that between November 10, 2009, and January 31, 2011, PNM's PII calculation was wrong and that, as set forth in PNM's Self-Certification, PNM's ?TE values were occasionally "stuck" between November 10, 2009 and May 11, 2011. The Audit Team further found that PNM has established a confirmation process for ?TE numbers used in the energy management system (EMS) against ?TE numbers published by the WECC Interchange Tool. PNM had created a system operator alarm to detect a failure of the ?TE value to change from one hour to the next.

Finding: The violation was deemed to pose minimal risk to BPS reliability. Any risk coming from a miscalculation would be offset in that any over or under correction would be fixed once discovered. Also, any corresponding over or under correction would have been remedied by normal operation of the Automatic Time Error Correction (ATEC) once the PII is corrected. In determining the appropriate penalty, WECC considered PNM's internal compliance program as a mitigating factor and the repeat violation of BAL-004-WECC-01 as an aggravating factor. PNM agreed/stipulated to WECC's findings.

Penalty: $79,000 (aggregate for nine penalties)

FERC Order: Issued October 26, 2012 (no further review)

Unidentified Registered Entity, FERC Docket No. NP11-64-000 (December 22, 2010)

Reliability Standard: BAL-004-WECC-01

Requirement: R1, R2

Violation Risk Factor: Lower (for R1, R2)

Violation Severity Level: Not provided

Region: WECC

Issue: In November 2009, a Registered Entity self-reported that, due to a software error, it had been operating its Automatic Generation Control (AGC), during the third quarter of 2009, without continuing utilizing the Automatic Time Error Correction (ATEC) as required (R1). In addition, the Registered Entity had not notified all of the control areas within WECC when it was operating its AGC without continuously utilizing the ATEC (R2).

Finding: The Registered Entity agreed to pay a penalty of $38,500 and to undertake other mitigation measures to resolve multiple violations. WECC found that the violations did not constitute a serious or substantial risk to the bulk power system since the Registered Entity had actually accumulated positive inadvertent interchange (as the software error caused the AGC system to minimize the Area Control Error with “Tie Line Bias,” excluding the ATEC adjustment). Even though not notifying the other control areas in WECC would result in the inadvertent interchange occurring as planned, the difference was limited to the Registered Entity’s L10 value (which would not have posed a serious or substantial risk to bulk power system reliability). The duration of the violations was from July 1, 2009 through October 1, 2009. In determining the penalty amount, WECC considered the fact that these were the Registered Entity’s first assessed violations of the relevant Reliability Standards; the violations were self-reported; and the Registered Entity was cooperative during the enforcement process and did not attempt to conceal the violations.

Penalty: $38,500 (aggregate for multiple violations)

FERC Order: Issued January 21, 2011 (no further review)

Unidentified Registered Entity, FERC Docket No. NP11-176-000 (April 29, 2011)

Reliability Standard: BAL-004-WECC-01

Requirement: R1

Violation Risk Factor: Lower

Violation Severity Level: Severe

Region: WECC

Issue: In July 2009, the Unidentified Registered Entity (URE) self-reported that it had not properly implemented the Automatic Time Error Correction as required (as the URE had not been using the change in Time Error that was provided by the Interconnection Time Monitor, or the Reliability Coordinator, to calculate its Primary Inadvertent Interchange).

Finding: WECC and the URE entered into a settlement agreement to resolve multiple violations, whereby the URE agreed to pay a penalty of $80,000 and to undertake other mitigation measures. WECC found that the violation of BAL-004-WECC-1 only constituted a minimal risk to bulk power system reliability since the URE was actually developing a Primary Inadvertent Interchange, which used a change in Time Error according to the URE’s frequency measurement. Before the Reliability Standard came into effect, the URE’s methodology was compatible with the regional procedure (and therefore there was minimal impact as a result of the URE continuing to use its previous methodology for an additional 30 days). The duration of the BAL-004-WECC-1 violation was from July 1, 2009 through July 30, 2009. In approving the settlement agreement and the penalty determination, NERC considered the fact that the violations were self-reported; the URE was cooperative during the enforcement process and did not conceal the violations; the URE had a compliance program in place (which was evaluated as a mitigating factor); the violations of IRO-005-2 R13 and TOP-004-2 R1 resulted from a single noncompliance occurrence; and there were no additional aggravating or mitigating factors.

Penalty: $80,000 (aggregate for 7 violations)

FERC Order: May 27, 2011 (no further review)

Unidentified Registered Entity, FERC Docket No. NP11-233-000, July 28, 2011

Reliability Standard: BAL-004-WECC-01

Requirement: R4

Violation Risk Factor: Lower

Violation Severity Level: Severe

Region: WECC

Issue: Following a Self-Report, WECC determined the Unidentified Registered Entity (URE) failed to use the correct Automatic Time Error Correction in its Primary Inadvertent Interchange balance.

Finding: WECC assessed a $70,000 penalty for this and other Reliability Standards violations. WECC determined that the violation posed a minimal risk to the reliability of the bulk power system (BPS) but did not pose a serious or substantial risk to the reliability of the BPS because the scheduled flow of energy needed in real time to support demand was not affected by URE’s incorrect calculations, and URE made appropriate corrections to prior calculations. In approving the settlement between URE and WECC, the NERC BOTCC considered the following factors: the violation did not constitute a repeat violation; URE was cooperative; URE self reported this violation; URE received partial self-reporting credit for the CIP-006-1 violation because the Self Report was submitted after the Self-Certification period, and did not receive any credit for self-reporting the CIP-007-1 violations because the Self-Reports were submitted during the Self-Certification period; URE had a compliance program in place; there was no evidence of an attempt or intent to conceal the violation; WECC determined the violation did not pose a serious or substantial risk to the BPS; there were no other aggravating or mitigating factors.

Penalty: $70,000 (aggregated for multiple violations)

FERC Order: Issued August 29, 2011 (no further review)

Unidentified Registered Entity (URE), Docket No. NP12-12 (January 30, 2011)

Reliability Standard: BAL-004-WECC-01

Requirement: 2

Violation Risk Factor: Lower

Violation Severity Level: Lower

Region: WECC

Issue: During an on-site audit, it was found that URE was not in compliance with BAL-004-WECC-01 because URE operated for 20 minutes on one day in an Automatic Generation Control (AGC) mode that was not Automatic Time Error Correction (ATEC) without notifying BAs of the alternate mode in use. During the relevant event, URE changed its AGC mode from ATEC to its Tie Line Bias (TLB) AGC because the ATEC was transmitting the wrong values to one of URE’s adjacent BAs. URE resolved the issue and returned the AGC to ATEC mode; however, URE could not show that it notified the parties required by the Standard.

Finding: WECC determined that this violation posed a minimal and not a serious or substantial risk to the reliability of the bulk power system (BPS) because the amount of time at issue was limited. To avoid this issue in the future, URE developed an alarm for the AGC in order that at any time the AGC is not in ATEC mode, WECC would be immediately notified. The WECC RC system then resends that message to other parties, including the neighboring BAs. URE agreed/stipulated to WECC’s findings.

Penalty: $55,000 (aggregate for 12 penalties)

FERC Order: Issued February 29, 2012 (no further review)

Unidentified Registered Entity, FERC Docket No. NP12-12 (January 30, 2012)

Reliability Standard: BAL-004-WECC-01

Requirement: R4.4

Violation Risk Factor: Lower

Violation Severity Level: Severe

Region: WECC

Issue: URE self-reported and WECC confirmed a violation of regional standard BAL-004-WECC-01 R4.4 because URE failed to compare its Time Error with the Interconnection Time Monitor and synchronize the reading to the nearest 0.001 seconds of the System Time Error. This problem resulted because URE failed to inform its EMS personnel of the daily requirement to obtain this time error value. Additionally, URE did not synchronize its time error daily value with the value issued by the WECC RC. URE stated its failure to comply was due to internal communication error in misplacing the notification to do so. URE immediately remedied the issue when its support staff became aware of the violation and complied with the daily synchronization requirement.

Finding: This violation posed only a minimal risk to the reliability of the BPS because although URE failed to synchronize its daily Time Error with the WECC RC, it did compute its hourly Primary Inadvertent Interchange value. URE used this value to calculate the Automatic Time Error Correction and maintain the scheduled flow of energy needed to support demand.

Penalty: $45,000 (aggregate for 7 penalties)

FERC Order: Issued March 1, 2012 (no further review)

Unidentified Registered Entity, FERC Docket No. NP12-38 (July 31, 2012)

Reliability Standard: BAL-004-WECC-01

Requirement: R2

Violation Risk Factor: Medium

Violation Severity Level: Severe

Region: WECC

Issue: URE self-reported that in ten instances it had operated its Automatic Generation Control (AGC) with unavailable Automatic Time Error Correction (ATEC) without notifying the other BAs in the Western Interconnection of this operating mode, as required by the Regional Reliability Standard and URE’s own written instructions.

Finding: WECC found that the BAL-004-WECC-01 violation only constituted a minimal risk to BPS reliability since URE was only operating with its ATEC off for a cumulative time of four hours and 57 minutes. In addition, even if the other BAs were notified of the change in URE’s operating conditions, they are not specifically authorized to undertake responsive actions since they are not allowed to make changes to their AGCs based on the AGC operation of another entity. In approving the settlement agreement, the NERC BOTCC considered the fact that some of the violations were URE’s second or third violation of the relevant Reliability Standards; some of the violations were self-reported; URE was cooperative during the enforcement process and did not conceal the violations; URE had an internal compliance program (which was evaluated as a mitigating factor); the violations did not constitute a serious or substantial risk to BPS reliability; and there were no additional aggravating or mitigating factors.

Penalty: $72,000 (aggregate for 12 violations)

FERC Order: Issued August 30, 2012 (no further review)