NERC Case Notes: Reliability Standard PER-002-0 | White & Case LLP International Law Firm, Global Law Practice
NERC Case Notes: Reliability Standard PER-002-0

NERC Case Notes: Reliability Standard PER-002-0

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This page contains the NOP (Notice of Penalty) and ACP (Administrative Citation of Penalty) summaries. Click here to read the FFT (Find, Fix and Track) summaries.

Alcoa Power Generating, Inc. - Tapoco Division (APGI-Tapoco), Docket No. NP13-8-000, November 30, 2012

Reliability Standard: PER-002-0

Requirement: R3; R3.1

Violation Risk Factor: High

Violation Severity Level: Lower

Region: SERC

Issue: Further to a compliance audit, SERC reported a violation of R3 after discovering that APGI-Tapoco, as a TOP, could not provide evidence that its training program included a set of training program objectives. Whereas NERC requires that TOP training programs define specific objectives based on NERC and Regional Reliability Organization standards, entity operating procedures, and applicable regulatory requirements, APGI-Tapoco's program merely stated: "… the program is necessary to assure requisite skills are taught, while existing skills are recognized."

Finding: SERC determined that the R3 violation posed a minimal risk to the reliability of the BPS because the TOP had been training personnel in accordance with its training program, even if the program lacked specific objectives. SERC and APGI-Tapoco entered into a settlement agreement to resolve multiple violations, whereby APGI-Tapoco agreed to pay a penalty and to undertake other mitigation measures to come into compliance with R3. SERC considered Alcoa Inc's FERC Compliance Policy and Plan (which governs APGI-Tapoco) a mitigating factor in making its penalty determination. The duration of the violation was from June 18, 2007 through January 12, 2012. APGI-Tapoco neither admits nor denies the R3 violation.

Penalty: $11,000 (aggregate for 12 violations)

FERC Order: Issued December 28, 2012 (no further review)

Alcoa Power Generating, Inc. - Yadkin Division (APGI-Yadkin), Docket No. NP13-8-000, November 30, 2012

Reliability Standard: PER-002-0

Requirement: R3; R3.1

Violation Risk Factor: High

Violation Severity Level: Lower

Region: SERC

Issue: Further to a compliance audit, SERC reported a violation of R3 after discovering that APGI-Yadkin, as a BA and TOP, could not provide evidence that its training program included a set of training program objectives. Whereas NERC requires that TOP training programs define specific objectives based on NERC and Regional Reliability Organization standards, entity operating procedures, and applicable regulatory requirements, APGI-Yadkin's program merely stated: "… the program is necessary to assure requisite skills are taught, while existing skills are recognized."

Finding: SERC determined that the R3 violation posed a minimal risk to the reliability of the BPS because APGI-Yadkin had been training personnel in accordance with its training program, even if the program lacked specific objectives. SERC and APGI-Yadkin entered into a settlement agreement to resolve multiple violations, whereby APGI-Yadkin agreed to pay a penalty and to undertake other mitigation measures to come into compliance with R3. SERC considered Alcoa Inc's FERC Compliance Policy and Plan (which governs APGI-Yadkin) a mitigating factor in making its penalty determination. The duration of the violation was from June 18, 2007 through January 12, 2012. APGI-Yadkin neither admits nor denies the R3 violation.

Penalty: $13,000 (aggregate for 12 violations)

FERC Order: Issued December 28, 2012 (no further review)

American Electric Power Service Corporation as agent for Appalachian Power Company, Columbus Southern Power Company, Indiana Michigan Power Company, Kentucky Power Company, Kingsport Power Company, Ohio Power Company, and Wheeling Power Company, FERC Docket No. NP13-35 (May 30, 2013)

Reliability Standard: PER-002-0

Requirement: 1

Violation Risk Factor: Medium

Violation Severity Level: Lower

Region: RFC

Issue: On the evening of June 23, 2010, PJM, American Electric Power Service Corporation's (AEP) Reliability Coordinator, experienced multiple outages on the AEP 138 kV system in the Benton Harbor area of southwest Michigan (the Kenzie Creek Event). During RFC's compliance investigation of the Kenzie Creek Event, RFC determined that AEP's operators were inadequately trained to implement load shedding for a localized situation (i.e., not involving Interconnection reliability operating limits). AEP's training program did not cover alleviating actual thermal overloads and did not teach that load shedding is required to alleviate contingencies (only that load shedding was a viable option).

Finding: RFC found that this violation constituted a moderate risk to BPS reliability since inadequately trained operating personnel can affect the reliable operation of the BPS (as seen by the uncertainty demonstrated by AEP's operators during the Kenzie Creek Event). But, the operators were NERC-certified and had undergone training (including high-level load shedding training which could have been applied to a localized situation). The duration of the PER-002-0 R1 violation was from June 23, 2010 through October 24, 2012. AEP admitted to the facts of the violations. In approving the settlement agreement, NERC BOTCC considered the fact that one of the violations was self-reported and that AEP had a compliance program in place (which was viewed as a partial mitigating factor). AEP also had two previous violations of FAC-009-1 R1. AEP was cooperative during the enforcement process and did not conceal the violations. Furthermore, AEP conducted an apparent cause analysis after the Kenzie Creek Event. In regards to the Kenzie Creek incident, one violation (FAC-009-1 R1) constituted a minimal risk to BPS reliability; five violations (COM-002-2 R2, EOP-003-1 R8, IRO-001-1.1 R8, PER-002-0 R1 and TOP-001-1 R5) constituted a moderate risk to BPS reliability; and four violations (EOP-001-0 R3, EOP-003-1 R1 and TOP-001-1 R1 and R2) constituted a serious and substantial risk to BPS reliability.

Total Penalty: $225,000 (aggregate for 10 violations)

FERC Order: Issued June 28, 2013 (no further review)

Arlington Valley, LLC - AVBA, FERC Docket No. NP13-9 (December 31, 2012)

Reliability Standard: PER-002-0

Requirement: 1, 2, 3, 4

Violation Risk Factor: High (1, 2, 3, 4)

Violation Severity Level: Severe (1, 2, 3, 4)

Region: WECC

Issue: Arlington Valley, LLC – AVBA (Arlington Valley) self-reported, as a TOP, that even though it had a generation-specific training program, it was not adequately training its operating personnel according to the requirements of the Reliability Standard (1). AVBA also did not have an adequate training program for those personnel specified in the Reliability Standard (2, 3). In addition, AVBA's training program did not mandate at least five days every year of training and drills that employ realistic simulations of system emergencies (4).

Finding: WECC found that the PER-002-0 violation constituted a moderate risk to BPS reliability. In regards to the PER-002-0 violations, by not having its operating personnel fully trained, there could be delays in enacting the real-time actions required for AVBA's system. But, the training program that AVBA had in place covered all of the operating proficiencies needed for the reliable operation of the generation system. In addition, all of AVBA's activities are coordinated with its Balancing Authority and Reliability Coordinator. The duration of the PER-002-0 violations was from November 5, 2007 through August 9, 2009 (1, 2, 3 and 4). AVBA stipulated to the violations. In approving the settlement agreement, the NERC BOTCC considered the fact that these violations were AVBA's first violations of the relevant Reliability Standards; the violations were not intentional and were promptly mitigated once discovered; and AVBA was cooperative during the enforcement process and did not conceal the violations. In addition, all but one of AVBA's violations did not constitute a serious or substantial risk to BPS reliability.

Penalty: $60,000 (aggregate for 43 violations)

FERC Order: Issued January 30, 2013 (no further review)

Avista Corporation, FERC Docket No. NP10-26-000 (December 31, 2009)

Reliability Standard: PER-002-0

Requirement: R3

Violation Risk Factor: High

Violation Severity Level: Not provided

Region: WECC 10

Issue: Avista's training documents did not reference the knowledge and competencies needed to apply the standards, procedures and requirements during normal, emergency and restoration conditions for certain positions, and its training program documentation did not demonstrate that training staff had competent knowledge of system operations and instructional capabilities as required by the standard.

Finding: Duration of violation wasfrom June 18, 2007, when the standard became enforceable, until October 10, 2007. Because it was a documentation issue, the violation did not cause a serious or substantial risk to the bulk power system.

Penalty: $30,000 (aggregate for multiple violations)

FERC Order: Issued January 29, 2010 (no further review)

Batesville Balancing Authority, FERC Docket No. NP09-12-000 (January 21, 2009)

Reliability Standard: PER-002-0

Requirement: R3.1

Violation Risk Factor: Medium

Violation Severity Level: Not provided

Region: SERC

Issue: Batesville Balancing Authority did not have a set of training program objectives referencing the knowledge and competencies necessary to apply standards, procedures and requirements to normal, emergency and restoration conditions.

Finding: No penalty was assessed for the violation because it happened during the transition period to mandatory standards and the violation would not put bulk power system reliability at serious or substantial risk. SERC also found the violation to be a documentation issue and the Batesville Balancing Authority completed a mitigation plan to avoid further violations.

Penalty: $0

FERC Order: Issued February 19, 2009 (no further review)

Black Hills Power, Inc., FERC Docket No. NP11-14-000 (November 5, 2010)

Reliability Standard: PER-002-0

Requirement: R4

Violation Risk Factor: High

Violation Severity Level: Lower

Region: WECC

Issue: Black Hills' training records showed that one of its employees, a training coordinator, had received only 29 of the mandatory 32 hours of training due to administrative oversight.

Finding: It was determined by WECC that the violation did not constitute a serious or substantial risk to the bulk power system because Black Hills failed to provide only 3 hours of mandatory training to a training coordinator. The duration of violation was from June 18, 2007 through July 31, 2008.

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

FERC Order: Issued December 3, 2010 (no further review)

Cedar Creek Wind Energy, LLC (CCWE), Docket No. NP12-42 (August 31, 2012)

Reliability Standard: PER-002-0

Requirement: 2, 3, 4

Violation Risk Factor: Medium (2, 3, 4)

Violation Severity Level: Severe (2, 3, 4)

Region: WECC

Issue: Based on a compliance audit in May 2010, WECC found that CCWE, as a TOP, did not have a fully compliant training program for all of its operating personnel in positions of primary responsibility, either directly or through communications with others, for real-time operations on the interconnected BPS or positions directly responsible for complying with NERC Reliability Standards (2). Furthermore, CCWE’s training program did not contain a defined set of objectives (based on NERC and WECC Reliability Standards), entity operating procedures and applicable regulatory requirements. CCWE also did not have a plan for the initial and continuing training of TOP operating personnel or a list of training time for all TOP operating personal and the identities of the training staff (3). In addition, CCWE did not have sufficient documentation showing that all of its operating personnel had at least five days annually of training and drills using realistic simulations of system emergencies (4).

Finding: WECC found that the PER-002-0 violations only constituted a minimal risk to BPS reliability. CCWE only owns a 72-mile 230 kV transmission line that connects its wind generation facility to a neighboring entity, and CCWE does not serve any load. As CCWE’s facility is connected to the neighboring entity through a ring bus, any problem on the CCWE line would be isolated and not impact the continuity of the neighboring entity’s system. The neighboring entity operators also have the authorization to undertake necessary actions on the CCWE line, which would mitigate any CCWE failure. The duration of the PER-002-0 violations was from January 21, 2008 through March 27, 2012. In approving the settlement agreement, the NERC BOTCC considered the fact that these were CCWE’s first violations of the relevant Reliability Standards; CCWE was cooperative during the enforcement process (complying with all applicable compliance directives) and did not conceal the violations; the violations were not intentional; the violations did not constitute a serious or substantial risk to BPS reliability; and there were no additional aggravating or mitigating factors.

Penalty: $60,000 (aggregate for 10 violations)

FERC Order: Issued September 28, 2012 (no further review)

City of Benton, FERC Docket No. NP08-36-000 (June 6, 2008)

Reliability Standard: PER-002-0

Requirement: R3.1

Violation Risk Factor: Medium

Violation Severity Level: Moderate

Region: SERC

Issue: City of Benton did not have a set of training program objectives referencing the knowledge and competencies necessary to apply standards, procedures and requirements to normal, emergency, and restoration conditions.

Finding: SERC did not assess a financial penalty for this violation because it was during the transition period to mandatory standards and the violation would not put bulk power system reliability at serious or substantial risk.

Penalty: $0

FERC Order: Issued July 3, 2008 (no further review)

City of Cleveland, Dept. of Public Utilities, Division of Cleveland Public Power, FERC Docket No. NP10-21-000 (December 30, 2009)

Reliability Standard: PER-002-0

Requirement: R1, R4

Violation Risk Factor: High

Violation Severity Level: Not provided

Region: ReliabilityFirst

Issue: Cleveland Public Power (CPP) did not provide evidence verifying that relevant personnel had received a minimum of five days training per year by the time required in its mitigation plan for violations occurring before the standards became enforceable.

Finding: Duration of violation from June 18, 2007 when the standards became enforceable through November 21, 2008.

Penalty: $160,000 (aggregate for multiple violations)

FERC Order: Issued January 29, 2010 (no further review)

City of Columbia, MO, FERC Docket No. NP08-29-000 (June 5, 2008)

Reliability Standard: PER-002-0

Requirement: R3.1

Violation Risk Factor: Medium

Violation Severity Level: Moderate

Region: SERC

Issue: City of Columbia, MO could not demonstrate that it had training program objectives in the operator training program.

Finding: SERC did not assess a financial penalty for this violation because it was during the transition period to mandatory standards and the violation would not put bulk power system reliability at serious or substantial risk.

Penalty: $0

FERC Order: Issued July 3, 2008 (no further review)

City of Conway, AR, FERC Docket No. NP09-10-000 (January 21, 2009)

Reliability Standard: PER-002-0

Requirement: R3.1

Violation Risk Factor: Medium

Violation Severity Level: Not provided

Region: SERC

Issue: City of Conway, AR did not have a set of training program objectives referencing the knowledge and competencies necessary to apply standards, procedures and requirements to normal, emergency and restoration conditions.

Finding: No penalty was assessed for the violation because it happened during the transition period to mandatory standards and the violation would not put bulk power system reliability at serious or substantial risk. SERC also found the violation to be a documentation issue and the City of Conway, AR completed a mitigation plan to avoid further violations.

Penalty: $0

FERC Order: Issued February 19, 2009 (no further review)

City of North Little Rock, AR, FERC Docket No. NP08-37-000 (June 6, 2008)

Reliability Standard: PER-002-0

Requirement: R3.1

Violation Risk Factor: Medium

Violation Severity Level: Moderate

Region: SERC

Issue: City of North Little Rock, AR did not have a set of training program objectives referencing the knowledge and competencies necessary to apply standards, procedures and requirements to normal, emergency, and restoration conditions.

Finding: SERC did not assess a financial penalty for this violation because it was during the transition period to mandatory standards and the violation would not put bulk power system reliability at serious or substantial risk.

Penalty: $0

FERC Order: Issued July 3, 2008 (no further review)

City of Ruston, LA, FERC Docket No. NP09-11-000 (January 21, 2009)

Reliability Standard: PER-002-0

Requirement: R3.1

Violation Risk Factor: Medium

Violation Severity Level: Not provided

Region: SERC

Issue: City of Ruston, LA did not have a set of training program objectives referencing the knowledge and competencies necessary to apply standards, procedures and requirements to normal, emergency and restoration conditions.

Finding: No penalty was assessed for the violation because it happened during the transition period to mandatory standards and the violation would not put bulk power system reliability at serious or substantial risk. SERC also found the violation to be a documentation issue and the City of Ruston, LA completed a mitigation plan to avoid further violations.

Penalty: $0

FERC Order: Issued February 19, 2009 (no further review)

City of West Memphis, AR FERC Docket No. NP09-14-000 (January 21, 2009)

Reliability Standard: PER-002-0

Requirement: R3.1

Violation Risk Factor: Medium

Violation Severity Level: Not provided

Region: SERC

Issue: City of West Memphis, AR did not have a set of training program objectives referencing the knowledge and competencies necessary to apply standards, procedures and requirements to normal, emergency and restoration conditions.

Finding: No penalty was assessed for the violation because it happened during the transition period to mandatory standards and the violation would not put bulk power system reliability at serious or substantial risk. SERC also found the violation to be a documentation issue and the City of West Memphis, AR completed a mitigation plan to avoid further violations.

Penalty: $0

FERC Order: Issued February 19, 2009 (no further review)

Colorado Springs Utilities, FERC Docket No. NP10-2-000 (October 14, 2009)

Reliability Standard: PER-002-0

Requirement: R3

Violation Risk Factor: High

Violation Severity Level: Not provided

Region: WECC

Issue: In June 2007, Colorado Springs Utilities self-reported that even though it implemented a training program, the program did not contain all of the required criteria.

Finding: WECC found that this violation did not involve a serious or substantial risk to bulk power system reliability since Colorado Springs Utilities was actually performing training and certification for its operators. Colorado Springs Utilities self-reported the violation and this was Colorado Springs Utilities’ first violation of this Reliability Standard. And although the violation initially occurred and was reported before the Reliability Standards became mandatory on June 18, 2007, Colorado Springs Utilities did not complete its Mitigation Plan by then, and thereby this violation also resulted in a post-June 18 violation. Even though Colorado Springs Utilities completed its Mitigation Plan late, no penalty was imposed.

Penalty: $0

FERC Order: Issued November 13, 2009 (no further review)

Dynegy Arlington Valley, LLC, FERC Docket No. NP11-139-000 (March 30, 2011)

Reliability Standard: PER-002-0

Requirement: R3

Violation Risk Factor: Medium

Violation Severity Level: Lower

Region: WECC

Issue: Dynegy Arlington Valley, LLC (DEAA), a Balancing Authority, was unable to produce a list of training program objectives for its operators during a Compliance Audit conducted between October 23, 2007 and October 25, 2007.

Finding: The NERC Board of Trustees Compliance Committee (NERC BOTCC) approved a settlement agreement which included a penalty in the amount of $0 for this violation. In reaching this determination, the NERC BOTCC considered the following facts, among others: the violation constituted DEAA’s first violation of the subject NERC Reliability Standard; DEAA cooperated during the compliance enforcement process; the violation is an older violation that was identified and fixed within the first year of mandatory standards; the violation did not create a serious or substantial risk to the bulk power system; and there were no other mitigating or aggravating factors or extenuating circumstances.

Penalty: $0

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

Electric Energy, Inc., FERC Docket No. NP10-46-000 (February 1, 2010)

Reliability Standard: PER-002-0

Requirement: R3.1

Violation Risk Factor: Medium

Violation Severity Level: Not provided

Region: SERC

Issue: Electric Energy, Inc.'s ("EEI") training documents did not contain the required training objectives referencing knowledge and competencies needed to apply standards, procedures, and requirements to normal, emergency, and restoration conditions.

Finding: Duration of violation was from June 18, 2007 when the standard became enforceable through August 25, 2008. The penalty was deemed appropriate becauseit wasEEI's first violation, this violation was a documentation issue, and the violation did not create a serious or substantial risk to the bulk power system reliability.

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

FERC Order: Issued March 3, 2010 (no further review)

Electric Reliability Council of Texas, Inc., FERC Docket No. NP11-268-000 (September 30, 2011)

Reliability Standard: PER-002-0

Requirement: R1

Violation Risk Factor: High

Violation Severity Level: Lower

Region: Texas RE

Issue: On February 26, 2008, the Electric Reliability Council of Texas, Inc. (ERCOT) declared an Emergency Electric Curtailment Plan Step 2 (EECP2) event on its system due to an unexpected imbalance between generation and load, causing a reduction in system frequency to levels that were outside acceptance operational limits. The event lasted two hours, but did not reduce in involuntary customer load shedding. Through an audit, Texas RE determined that ERCOT failed to adequately train its operating personnel concerning EECP procedures.

Finding: Texas RE determined that the violation posed a serious and substantial risk to the BPS because it put the Texas grid reliability at unnecessary and avoidable higher levels of risk than would otherwise have been the case, potentially leading to a wide spread and severe system disturbance. Duration of violation was February 26, 2008. Texas RE and the NERC BOTCC took into consideration that this was ERCOT's first violation of the Standard in reaching a penalty assessment, and also concluded that the serious and substantial risk to the BPS constituted an aggravating factor.

Penalty: $384,000 (aggregate for 15 violations)

FERC Order: Issued October 28, 2011 (no further review)

Eugene Water & Electric Board (EWEB), Docket No. NP12-22-000 (March 30, 2012)

Reliability Standard: PER-002-0

Requirement: R1, R2, R3, R4

Violation Risk Factor: High

Violation Severity Level: Severe

Region: WECC

Issue: EWEB registered as a TOP with NERC effective as of May 8, 2009, and subsequently, EWEB submitted self-reports addressing non-compliance with NERC Reliability Standards. EWEB is located in the Bonneville Power Administration (BPA) Control Area. Prior to May 8, BPA was registered with NERC as the area TOP, and BPA had informed EWEB that it was not required to register as a TOP with NERC; however, after review of a FERC order discussing TOP compliance, on April 6, 2009, BPA notified EWEB that it would no longer serve as its TOP. EWEB then registered as a TOP and reported itself as non-compliant with applicable NERC Reliability Standards.

Starting on May 8, 2009, the date EWEB registered as a TOP with NERC, EWEB was in violation of R1, R2, R3 and R4 of PER-002-0. Regarding R1, EWEB’s operating personnel were not trained as required. Regarding R2, EWEB did not have a NERC standards training program in place for system operators having primary responsibility for real-time operation of the interconnected BES. Regarding R3, EWEB had no training program containing training objectives nor did it have documentation of initial and continuing training held that addressed competencies and knowledge. Also, no training staff was identified nor was any knowledge or competencies of system operations and instructional capabilities identified. Finally, regarding R4, EWEB did not give its operating personnel the required five days per year of training through the use of realistic simulations of system emergencies, as well as other required training to maintain qualified operating personnel.

Finding: The violations posed no serious or substantial risk to BPS reliability. WECC considered that EWEB was new to the TOP role because of a registration issue. Although EWEB did not staff properly trained operating personnel, risk to the BPS was mitigated because its facility is a 115 kV local network that has no critical facilities as listed on WECC’s critical facilities list. EWEB’s network is set up to take power from BPA and serves its load. Disruptions to its facility would not have a significant impact on the systems of the nearby BAs and TOPs. WECC further found that EWEB staff was sufficiently experienced and knowledgeable and had received training to ensure system reliability during the period EWEB was establishing training processes as required by the Standard. WECC considered that even though EWEB had not coordinated its current day, next day and seasonal planning and operations with the adjacent BAs and TOP and with its RC, those activities are generally done on a long-term or annual basis, and BPA had plans in place to make sure normal interconnection operations were undisturbed while EWEB completed its documentation to be compliant with the PER-002-0 Standards. In addition, BPA conducted a technical assessment of EWEB’s electrical system in determining whether it would act as EWEB’s TOP, and the assessment results showed that BPA was not performing TOP duties in the first place, and second it did not need control of the EWEB system for BPS reliability. As the BA for EWEB, BPA was responsible for system reliability within its footprint. While EWEB was working towards TOP certification, BPA performed TOP duties such as coordinating outage plans, day-to-day routine real-time communications and notifications and any unplanned work forced by equipment failures, storms, etc. BPA assured the RC it would continue to communicate any planned and emergency outages and would work diligently with EWEB to obtain full TOP certification. At the time EWEB registered as a TOP, it was working on compliance with its other functions as Transmission Owner (TO), Transmission Provider (TP), Purchasing-Selling Entity (PSE), Load Serving Entity (LSE), Distribution Provider (DP), Generator Owner (GO) and Generator Operator (GOP).

WECC assessed no penalty due to the circumstances surrounding the non compliance. BPA unexpectedly notified EWEB that it would not be its TOP, effective immediately on April 6, 2009. EWEB then found itself immediately required to be NERC compliant. EWEB submitted its self reports in a timely manner and in addition submitted mitigation plans which were timely completed. The violations were not repeat violations and were not contested by EWEB.

Penalty: $0

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

Florida Keys Electric Cooperative Association, FERC Docket No. NP11-253-000, July 29, 2011

Reliability Standard: PER-002-0

Requirement: R3.4

Violation Risk Factor: Lower

Violation Severity Level: Moderate

Region: FRCC

Issue: During an audit, FRCC determined that Florida Keys Electric Cooperative Association (FKEC) could not supply sufficient evidence that its training staff had knowledge of instructional capabilities from June 18, 2007 to March 24, 2009.

Finding: FRCC assessed a $1,500 penalty for this and other Reliability Standards violations. FRCC determined that the violation posed a minimal risk but did not pose a serious or substantial risk to the reliability of the bulk power system because the training staff was competent in the knowledge of system operations and although it lacked documentation of instructional capability, FKEC had trained employees in the past. NERC approved the settlement in an Administrative Citation Notice of Penalty.

Penalty: $1,500 (aggregated for 7 violations)

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

Gila River Power, LP - BA, FERC Docket No. NP11-90-000 (January 31, 2011)

Reliability Standard: PER-002-0

Requirement: R3

Violation Risk Factor: Medium

Violation Severity Level: Lower

Region: WECC

Issue: During a compliance audit in October 2007, WECC found that Gila River Power, LP – BA's (GRMA) training program for Transmission Operators did not include a list of training program objectives for its Balancing Authority operating positions as required (even though the program did include a list of training topics).

Finding: WECC and GRMA entered into a settlement agreement to resolve multiple violations, whereby GRMA agreed to undertake other mitigation measures to resolve the violations. WECC found that the PER-002-0 violation did not constitute a serious or substantial risk to bulk power system reliability since Constellation Energy Control and Dispatch, LLC, who performs GRMA's Balancing Authority requirements pursuant to a Balancing Authority Services Agreement, did actually have a training program in place and was conducting training for the operators in system operations. The duration of the PER-002-0 violation was from June 18, 2007 through April 28, 2008. In approving the settlement agreement, NERC found that this was GRMA's first violation of the relevant Reliability Standard; GRMA was cooperative during the enforcement process and did not conceal the violation; and there were no additional mitigating or aggravating factors.

Penalty: $0

FERC Order: Issued March 2, 2011 (no further review)

Hetch Hetchy Water and Power (HHWP), Docket No. NP12-47-000 (September 28, 2012)

Reliability Standard: PER-002-0

Requirement: 2, 3

Violation Risk Factor: High

Violation Severity Level: Severe

Region: WECC

Issue: HHWP self-reported in July 2011 that it had not complied with the requirement of PER-002-0 R2 in that, as a TOP, it did not have a formal training program for employees responsible for compliance with Reliability Standards. As a result, HHWP was also not compliant with PER-002-0 R3 because it had no training program objectives or plans for initial and continuing training for operating personnel. Any such training program is also required to have training times established in order to ensure its operating staff and training staff are competent in system operations.

Finding: The violations were deemed to pose minimal risk to BPS reliability because all of HHWP's TOP functions are performed by HHWP's NERC-certified system operators. New employees undergo initial training and show mastery of basic operator job responsibilities before advancing to journey-level status. And, HHWP's journey-level system operators are NERC certified. Those system operators receive continuing education as required by NERC. Supervisors in the HHWP control room have engaged in joint emergency operations drills sponsored by the California Electric Training Advisory Committee. In determining the appropriate penalty, WECC gave no credit for the self-reports; however, HHWP's internal compliance program was a mitigating factor. HHWP agreed/stipulated to WECC's finding.

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

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

Indianapolis Power & Light Company, FERC Docket No. NP11-210-000 (June 29, 2011)

Reliability Standard: PER-002-0

Requirement: R1, R2, R3, R4

Violation Risk Factor: High (for R1, R2, R3, R4)

Violation Severity Level: Severe (R1, R4), Moderate (R3), Lower (R2)

Region: RFC

Issue: During a compliance audit in March 2010, RFC found that Indianapolis Power & Light Company (IPL), as a Balancing Authority and Transmission Operator, was not ensuring that all of its operating personnel received sufficient training (R1). RFC also found that IPL did not conduct a proper training program for its System Energy Coordinators (i.e., those personnel directly responsible for complying with the Reliability Standards) (R2). In addition, RFC determined that IPL had not developed a training program for the System Energy Coordinators and did not reference the knowledge and contingencies that would be needed to apply the relevant standards, procedures, and requirements to the full scope of normal, emergency, and restoration conditions (R3). Furthermore, IPL did not possess proper documentation regarding whether five of its employees received the required five days of emergency training in 2008 (R4).

Finding: RFC and IPL entered into a settlement agreement to resolve multiple violations, whereby IPL agreed to pay a penalty of $70,000 and to undertake other mitigation measures. RFC found that the PER-002-0 violations did not constitute a serious or substantial risk to bulk power system reliability since the relevant System Energy Coordinators possess many years of experience on the job and are NERC-certified. In addition, the System Energy Coordinators are supervised by IPL’s System Operators. The duration of the PER-002-0 violations was from June 18, 2007 through January 20, 2010 (for R1, R2 and R3) and from December 31, 2008 through December 31, 2009 (for R4). In approving the settlement agreement, NERC found that these were IPL’s first violations of the relevant Reliability Standards; IPL was cooperative during the enforcement proceeding and did not conceal the violations; there was a compliance program in place (which was evaluated as a mitigating factor); and there were no additional aggravating or mitigating factors.

Penalty: $70,000 (aggregate for 11 violations)

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

Lakeland Electric, FERC Docket No. NP10-2-000 (October 14, 2009)

Reliability Standard: PER-002-0

Requirement: R3.2

Violation Risk Factor: Medium

Violation Severity Level: Not provided

Region: FRCC

Issue: In December 2007, it was discovered that Lakeland Electric did not include a plan for the initial training of Transmission Operators in its training program.

Finding: FRCC found that this violation did not involve a serious or substantial risk to bulk power system reliability since a training program, which included initial training for Transmission Operators, was actually being performed. This violation involved mainly a documentation issue. This was Lakeland Electric's first violation of this Reliability Standard and it completed a Mitigation Plan.

Total Penalty: $0

FERC Order: Issued November 13, 2009 (no further review)

Los Angeles Department of Water and Power, FERC Docket No. NP10-141-000 (July 6, 2010)

Reliability Standard: PER-002-0

Requirement: R1

Violation Risk Factor: High

Violation Severity Level: Not provided

Region: WECC

Issue: During an audit, WECC determined that LADWP did not provide adequate personnel training on the loss of control center functionality because LADWP could not provide evidence that it performed such training after June 18, 2007.

Finding: Duration of violation was from June 18, 2007, when the standard became enforceable, through July 5, 2008. The violation did not pose a serious or substantial risk to the reliability of the bulk power system, but it did pose a moderate risk because it is important that LADWP’s personnel are familiar with the LADWP plan in the event of a loss of the primary control center to enable continued operations.

Penalty: $225,000 (aggregate for multiple violations)

FERC Order: Issued Oct. 8, 2010 (no further review)

Mesquite Power LLC, FERC Docket No. NP12-35 (June 29, 2012)

Reliability Standard: PER-002-0

Requirement: R1, R2, R3, R4

Violation Risk Factor: High (R1, R2, R3, R4)

Violation Severity Level: Severe (R1, R2, R3, R4)

Region: WECC

Issue: In March 2009, Mesquite Power LLC (Mesquite), as a TOP, self-certified that it did not have a formal training program in place for its operating personnel (R2, R3, R4). Therefore, Mesquite was not considered to be staffed with adequately trained operating personnel (R1).

Finding: WECC found that the PER-002-0 violations only constituted a minimal risk to BPS reliability since Mesquite’s operating personnel did have the operating proficiencies needed to reliably operate Mesquite’s generation system. In addition, Mesquite was coordinating its activities with its BA, which was coordinating the activities with the RC. The duration of the PER-002-0 violations was from November 5, 2007 through December 22, 2009. In approving the settlement agreement, the NERC BOTCC considered the fact that these were Mesquite’s first violations of the relevant Reliability Standard; one of the violations (VAR-002-1 R3) was self-reported; Mesquite was cooperative during the enforcement process and did not conceal the violations; Mesquite did have a compliance program in place (which was evaluated as a mitigating factor); there were two violations of the same Reliability Standard (PER-003-0 R1) that demonstrated the repeat nature of the violation (which was evaluated as an aggravating factor); the violations did not constitute a serious or substantial risk to BPS reliability; and there were no additional aggravating or mitigating factors.

Penalty: $60,000 (aggregate for 26 violations)

FERC Order: Order issued July 27, 2012 (no further review)

Milford Wind Corridor Phase I, LLC, FERC Docket No. NP13-40 (June 27, 2013)

Reliability Standard: PER-002-0

Requirement: 2, 3, 4

Violation Risk Factor: Medium (2 3, 4)

Violation Severity Level: Severe (2, 3, 4)

Region: WECC

Issue: Milford Wind Corridor Phase I, LLC (Milford Wind) self-certified that it had not established a training program for all of its operating personnel as required (2 and 3) and did not conduct drills using realistic simulations of system emergencies (4).

Finding: WECC found that the PER-002-0 violations only constituted a minimal risk to BPS reliability. Milford Wind’s output is not baseload generation, and if Milford Wind was unable to deliver its generation, the host BA would be able to find replacement generation without there being an adverse impact on BPS reliability. Milford Wind’s generation is non-firm and intermittent, and thus its transmission facilities are limited in use. Milford Wind’s transmission line is radial in nature and is only used to connect Milford Wind’s generation to the bulk power system. The PER-002-0 violations occurred from May 18, 2010 through September 19, 2010. Milford neither admitted nor denied the violations. In approving the settlement agreement, NERC BOTCC considered the fact that these violations were Milford Wind’s first violations of the relevant Reliability Standard and that Milford Wind had a compliance program in place. Milford Wind was also cooperative during the enforcement process and did not conceal the violations.

Total Penalty: $81,000 (aggregate for 15 violations)

FERC Order: Issued July 26, 2013 (no further review)

Modesto Irrigation District, FERC Docket No. NP10-93-000 (March 31, 2010)

Reliability Standard: PER-002-0

Requirement: R2, R3, R4

Violation Risk Factor: High

Violation Severity Level: Not provided

Region: WECC

Issue: Modesto Irrigation District's (MID) documented training program did not comply with the requirements of the Standard.

Finding: The alleged violations occurred from June 18, 2007, when the Standard became enforceable, until September 12, 2008, when MID completed a mitigation plan. Through settlement, no penalty was assessed and MID agreed to undertake a number of activities, including accelerating "Job Task Analysis" development for MID's operators and construction of a back-up control center. In reaching the agreement, WECC considered that it was MID’s first violations of this Standard; the violations did not pose a serious or substantial risk to the reliability of the bulk power system; MID is a government entity and a small irrigation district; most violations were self-reported; MID did not attempt to conceal the violations; and the violations were not intentional.

Penalty: $0

FERC Order: Issued April 30, 2010 (no further review)

NERC Registered Entity, FERC Docket No. NP10-159-000 (July 30, 2010)

Reliability Standard: PER-002-0

Requirement: R3

Violation Risk Factor: High

Violation Severity Level: Not provided

Region: WECC

Issue: The Registered Entity failed to include clearly defined training objectives in its operator training program and did not define a continuing training program.

Finding: Duration of the violation was from June 18, 2007, when the Reliability Standard became enforceable, through January 29, 2009. The violation posed a moderate risk to the reliability of the bulk power system because if personnel had responded incorrectly to disturbances due to lack of training, reliability problems could be exacerbated. This was the Registered Entity's first violation of the Reliability Standard.

Penalty: $109,000 (aggregate for multiple violations)

FERC Order:Issued August 27, 2010 (no further review)

New Harquahala Generating Company, LLC, FERC Docket No. NP10-2-000 (October 14, 2009)

Reliability Standard: PER-002-0

Requirement: R1, R2, R3, R4

Violation Risk Factor: High (for R1, R2, R3, R4)

Violation Severity Level: Not provided

Region: WECC

Issue: New Harquahala Generating Company, LLC (New Harquahala) self-reported that it did not have a sufficient training program for its operating personnel concerning transmission operations that met the requirements of PER-002-0.

Finding: WECC found that the violations did not pose a serious or substantial risk to the bulk power system since a third party was functioning as New Harquahala's Balancing Authority and this third party was fully compliant with the requirements of PER-002-0. In addition, New Harquahala closely coordinated the operation of its radial transmission line with an interconnected entity. This Registered Entity had a training program for generator operators (even though the training did not address Transmission Operator functions). The violations were self-reported and they were New Harquahala's first violations of this Reliability Standard. Even though the violations occurred before the Reliability Standards became mandatory, New Harquahala did not complete its mitigation plan in a timely manner, turning the violation into post-June 18, 2007 violations. Even though the mitigation plan was completed late, no penalty was imposed.

Penalty: $0

FERC Order: Issued November 13, 2009 (no further review)

PacifiCorp, FERC Docket No. IN11-6 (December 1, 2011)

Reliability Standard: PER-002-0

Requirement: R1

Issue: On February 14, 2008, a short circuit occurred on a transformer at PacifiCorp’s Huntington generation plant in Utah, which triggered an immediate loss of approximately 2800 MW of generation across PacifiCorp’s East Balancing Authority Area (“PacifiCorp East” – which consists of Utah, southeast Idaho and western Wyoming) and the shedding of approximately 183 MW of firm load in Utah. During the emergency, PacifiCorp’s Balancing and Interchange Operator that was on duty during the incident did not undertake the needed actions to address the disturbance and did not understand all of the tools and options that were available. For example, the operator did not know how the reserve program worked or how much reserves were able to be delivered to PacifiCorp.

Finding: On December 1, 2011, FERC approved a Stipulation and Consent Agreement between FERC Office of Enforcement (“Enforcement”), NERC and PacifiCorp regarding PacifiCorp’s actions as a BA and TOP surrounding the February 14, 2008 disturbance. In terms of the PER-001-0 R1 violation, Enforcement and NERC found that the relevant operator was not sufficiently trained since he was unfamiliar with the reserve sharing agreement. A BA is required to be staffed with adequately trained personnel.

Penalty: $3,925,000 (aggregate for 23 violations)

FERC Order: http://elibrary.ferc.gov/idmws/common/opennat.asp?fileID=12829507

Pend Oreille County Public Utility District No. 1, FERC Docket No. NP11-11-000 (November 5, 2010)

Reliability Standard: PER-002-0

Requirement: R3, R4

Violation Risk Factor: High

Violation Severity Level: Severe

Region: WECC

Issue: Pend Oreille failed to demonstrate that it had a system operator training program prior to August 13, 2008 that identified defined training objectives and included a plan for continuing training, or specified training times and training staff, in violation of R3. Pend Oreille also violated R4 because it failed to demonstrate that it provided its operators at least 5 days of training using realistic simulations of system emergencies.

Finding: It was determined by WECC that the violation did not constitute a serious or substantial risk to the bulk power system because Pend Oreille's operating personnel were NERC certified which required them to undergo training regarding reliable operation of Pend Oreille's facilities. The duration of violation was from June 18, 2007 through August 13, 2008 for R3 and December 14, 2009 for R4.

Penalty: $26,000 (aggregate for multiple violations)

FERC Order: Issued December 3, 2010 (no further review)

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

Reliability Standard: PER-002-0

Requirement: 3/3.2

Violation Risk Factor: Medium

Violation Severity Level: Lower

Region: WECC

Issue: While conducting an On-site Compliance Audit, the Audit Team confirmed the following violation: as a BA and TOP, PNM did not document its initial training program for new system operators. Although, PNM had a training program in place, its initial training program for Wholesale Power Marketing (WPM) personnel was not documented until December 17, 2010.

Finding: The violation was deemed to pose minimal risk to BPS reliability which was mitigated because the violation was a documentation issue. Although PNM did not have records for WPM staff, PNM could show that an initial training program was in place and being used in training new operators. PNM also provided training records indicating that informal initial training was being implemented, and the topic areas were appropriate for an initial training program. 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)

Public Utility District No. 1 of Clark County, FERC Docket No. NP12-5 (November 30, 2011)

Reliability Standard: PER-002-0

Requirement: R1, R3, R4

Violation Risk Factor: High

Violation Severity Level: Severe

Region: WECC

Issue: In preparation for its registration with NERC as a TOP, in April 2009 CKPD self-reported non-compliance with PER-002-0 R1, R3 and R4. CKPD explained that its TOP, Bonneville Power Administration (BPA), informed it on April 6, 2009, that it would no longer function as CKPD’s TOP effective immediately. As a result, CKPD was required to register as a TOP and report non-compliance with the Standard. CKPD reported that the requirements of PER-002-0 were new to CKPD because of its TOP registration, and at the time of registration had the following violations. R1: CKPD’s operating personnel had not been trained as required by the Standard. R3: CKPD had no training program with objectives in place nor did it have documentation regarding initial and continuing training provided for competencies and knowledge. Also, CKPD could not provide any information on the training staff or their qualifications. R4: CKPD’s operating personnel had not received the five days per year of system emergency training using simulated emergencies and other training necessary required for qualified operating personnel.

Finding: WECC determined the violations did not pose a serious or substantial risk to the reliability of the BPS because CKPD had started a training program, but it was after its NERC registration date and CKPD worked to correct the existing training program to meet NERC’s requirements. In addition, BPA would have assisted to maintain BPS operations, and CKPD’s facilities are not critical to BPS reliability. WECC recognized that at the time of its registration for the TOP function, CKPD was satisfying the requirements for its other functions as a TO, PSE, LSE, DP, GO and GOP. BPA performed tests on CKPD’s electric system during April 2009 which showed that it was not conducting TOP duties at the facility and the facility was not required to maintain system reliability. BPA also reported that CPKD employs experienced operators and also has internal maintenance procedures including a 24-hour dispatch center. WECC assessed no penalty for the violation based on the extenuating circumstances surrounding the non-compliance. In particular, BPA’s notice to CKPD that it would no longer operate as the TOP was unexpected and effective immediately. Consequently, CKPD was immediately responsible for registration and compliance with all applicable TOP standards. WECC also considered the following mitigating factors: the violations were self-reported, mitigation plans were quickly submitted and timely completed; the risk to the BPS was not serious or substantial; the violations were not repeat violations; and CKPD did not dispute the violations.

Penalty: $0 (for 33 violations)

FERC Order: Issued December 30, 2011 (no further review)

Public Utility District No. 1 of Snohomish County (SNPD), Docket No. NP12-22-000 (March 30, 2012)

Reliability Standard: PER-002-0

Requirement: R1, R2, R3, R4

Violation Risk Factor: High

Violation Severity Level: Severe

Region: WECC

Issue: SNPD registered as a TOP with NERC effective as of February 6, 2009, and subsequently, SNPD submitted self-reports addressing non-compliance with NERC Reliability Standards. SNPD is located in the Bonneville Power Administration (BPA) Control Area. BPA was registered with NERC as the area TOP, and BPA had informed SNPD that it was not required to register as a TOP with NERC; however, after review of a FERC order discussing TOP compliance, on December 24, 2008, BPA notified SNPD that it would no longer serve as its TOP, effective immediately. SNPD then registered as a TOP and reported itself as non-compliant with applicable NERC Reliability Standards. SNPD underwent a WECC audit in January 2012 and no compliance violations were found.

Starting on February 6, 2009, the date SNPD registered as a TOP with NERC, SNPD was in violation of R1, R2, R3 and R4 of PER-002-0. Regarding R1, SNPD’s operating personnel were not trained as required. Regarding R2, SNPD did not have a NERC standards training program in place for system operators having primary responsibility for real-time operation of the interconnected BES. Regarding R3, SPND had no training program containing training objectives nor did it have documentation of initial and continuing training held that addressed competencies and knowledge. Also, no training staff was identified nor was any knowledge or competencies of system operations and instructional capabilities identified. Finally, regarding R4, SPND did not give its operating personnel the required five days per year of training through the use of realistic simulations of system emergencies, as well as other required training to maintain qualified operating personnel.

Finding: The violations posed no serious or substantial risk to BPS reliability. WECC considered that SNPD was new to the TOP role because of a registration issue. Even though SPND did not staff adequately trained operation personnel, actual risk was mitigated by the size of SNPD and the fact that it has no critical facilities as identified by WECC. SNPD’s network is set up to take power from BPA and serves its load. SNPD was coordinating with BPA during the violation period and BPA had trained staff available to SNPD. In addition, BPA conducted a technical assessment of SPND’s electrical system in determining whether it would act as SPND’s TOP, and the assessment results showed that BPA was not performing TOP duties in the first place, and second it did not need control of the SNPD system for BPS reliability. While SNPD was working towards TOP certification, BPA performed TOP duties such as coordinating outage plans, day-to-day routine real-time communications and notifications and any unplanned work forced by equipment failures, storms, etc. BPA assured the RC it would continue to communicate any planned and emergency outages and would work diligently with SNPD to obtain full TOP certification. At the time SNPD registered as a TOP, it was working on compliance with its other functions as Transmission Owner (TO), Transmission Provider (TP), Purchasing-Selling Entity (PSE), Load Serving Entity (LSE), Distribution Provider (DP), Generator Owner (GO) and Generator Operator (GOP).

WECC assessed no penalty due to the circumstances surrounding the non compliance. BPA unexpectedly notified SNPD that it would not be its TOP, effective immediately on December 24, 2008. SNPD then found itself immediately required to be NERC compliant. SNPD submitted its self reports in a timely manner and in addition submitted mitigation plans which were timely completed. The violations were not repeat violations and were not contested by SNPD.

Penalty: $0

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

PUD No. 1 Douglas County, FERC Docket No. NP10-167-000 (September 30, 2010)

Reliability Standard: PER-002-0

Requirement: R1

Violation Risk Factor: High

Violation Severity Level: Lower

Region: WECC

Issue: PUD No. 1 of Douglas County (DOPD), as a Balancing Authority and Transmission Operator, did not train its operating personnel consistent with the training objectives in DOPD’s System Operator Training Program. WECC noted that one operator was 11.5 hours short of the required 80 hours of continuing education hours annually required by DOPD’s program.

Finding: The alleged violation occurred from June 18, 2007, when the Standard became mandatory and enforceable, until September 30, 2008. WECC imposed a $70,000 penalty for this and other violations. In assessing the penalty, WECC determined that the alleged violation did not create a serious or substantial risk to the bulk power system because all DOPD operating personnel are NERC-certified and DOPD’s training requirements exceeded the minimum 5 days of emergency operations training required in the Standard.

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

FERC Order: Issued October 29, 2010 (no further review)

Rochester Public Utilities, FERC Docket No. NP08-35-000 (June 5, 2008)

Reliability Standard: PER-002-0

Requirement: R3

Violation Risk Factor: High/Medium

Violation Severity Level: Not provided

Region: MRO

Issue: Rochester Public Utilities could not provide evidence of a training program that concerned knowledge, competencies, objectives, and measures for system operators.

Finding: MRO did not assess a financial penalty for this violation because it occurred during the transition period to mandatory standards and the violation did not put bulk power system reliability at serious or substantial risk.

Penalty: $0

FERC Order: Issued July 3, 2008 (no further review)

Sacramento Municipal Utility District, FERC Docket No. NP12-8 (December 30, 2011)

Reliability Standard: PER-002-0

Requirement: R1

Violation Risk Factor: High

Violation Severity Level: Lower

Region: NCEA

Issue: During a compliance investigation regarding a December 26, 2008 incident where Sacramento Municipal Utility District (SMUD) lost substation DC control voltage supply at its Orangevale (ORV) substation, NCEA determined that the SMUD Power System Operator (PSO), functioning as a TOP, had inadequate knowledge and understanding of SMUD’s standard circuit breaker supervisory control switching and indicator scheme on its Energy Management System (EMS) SCADA control scheme. The SCADA control schemes are material to the control and operation of BPS equipment and facilities.

Finding: NCEA found that the PER-002-2 violation constituted only a minimal risk to BPS reliability since SMUD’s substations and transmission lines (consisting of 230 kV or lower voltage) represent only a small portion of the Western Interconnection in the vicinity of SMUD’s BPS facilities (and any impact would likely be limited to the local vicinity of SMUD’s own system facilities and would not spread throughout the Western Interconnection). The duration of the PER-002-2 violation was from June 18, 2007 through March 25, 2009. SMUD has also invested over $1.17 million to install redundant measures in its backup systems in a number of its substations. In determining the aggregate penalty amount, NERC BOTCC considered the fact that these violations were SMUD’s first violations of the relevant Reliability Standards; one of the violations was self-reported; SMUD was cooperative during the enforcement process and did not conceal the violations; SMUD had a compliance program in place (which was evaluated as a mitigating factor); the violations did not pose a serious or substantial risk to BPS reliability; and there were no additional aggravating or mitigating factors.

Penalty: $100,000 (aggregate for 6 violations)

FERC Order: Issued January 27, 2012 (no further review)

San Diego Gas & Electric, FERC Docket No. NP13-53 (September 30, 2013)

Reliability Standard: PER-002-0

Requirement: 1

Violation Risk Factor: High

Violation Severity Level: High

Region: NERC

Issue: As part of a NERC compliance investigation into the November 7, 2008 fire in a series capacitor bank in San Diego Gas & Electric’s (SDG&E) service territory which led to a 500 kV line being taken out of service, NERC found that SDG&E did not adequately train all of its operators as required. On November 7, 2008, SDG&E’s control room operator was unable to operate the motor operated disconnects (MODs) for the series capacitor, which delayed the recovery of the 500 kV line. A different SDG&E operator was able to talk the initial operator through the necessary steps to operate the MODs. Because of the 500 kV line being taken out of service, there was an overload on Path 49 and System Operating Limits (SOL) were exceeded on Path 49 and Path 44, which resulted in load shedding.

Finding: NERC found that the violation constituted a moderate risk to BPS reliability. But, even though SDG&E did not immediately isolate the series capacitor bank at issue, the Path 49 and Path 44 operators were obligated, independent of any action by SDG&E, to address the excess SOLs. In response, CAISO implemented load shedding by other entities, derated other lines, shifted load and brought the 500 kV line back into service. The duration of the violation was from November 7, 2008 through February 8, 2009. SDG&E neither admitted nor denied the violation. In approving the settlement agreement, NERC BOTCC considered the fact that the violation was SDG&E’s first violation of this Reliability Standard and SDG&E had a compliance program in place when the violation occurred. But, load was shed on November 7, 2008 (approximately 200 MW by Southern California Edison). SDG&E was also cooperative during the enforcement process and did not conceal the violation.

Total Penalty: $5,000

FERC Order: Issued October 30, 3013 (no further review)

Silicon Valley Power (SVP), Docket No. NP13-21 (January 31, 2013)

Reliability Standard: PER-002-0

Requirement: 1, 2, 3

Violation Risk Factor: High (all)

Violation Severity Level: Severe (all)

Region: WECC

Issue: Silicon Valley Power (SVP), as a TOP, self-reported that even though four of six of its transmission operators were NERC-certified, it did not have a formal training program to provide its operating personnel with adequate training (1). SVP also self-reported that it did not have a sufficient training program for all of its operating personnel who have primary responsibility for the real-time operation of the interconnected bulk electric system and who are directly responsible for compliance with the NERC Reliability Standards (2). In addition, SVP self-reported that it did not have a training program that contained a defined set of training program initiatives, included a place for initial and continuing training of operating personnel, detailed training time for all operating personnel and listed a competent training staff.

Finding: WECC found that the PER-002-0 R1 violation constituted only a minimal risk to BPS reliability. SVP’s operators were properly trained, even though SVP did not have a formal training program. But, WECC found that the PER-002-0 R2 and R3 violations constituted a moderate risk to BPS reliability as it could have resulted in SVP’s operating personnel having inadequate knowledge and training. When SVP filed the self-reports, four of its operators were already NERC-certified and the other two operators were in the process of earning their NERC certification. In addition, SVP had documentation showing that for 88% of the time NERC-certified operators were the ones responsible for the reliable operation of the BPS. For the one operator that was hired during the violation period, he was attending training during the work day. SVP’s operators also participated in online training related to SVP’s operations. The duration of the PER-002-0 violations was from May 27, 2011 through June 27, 2012. SVP agreed and stipulated to the violations. In approving the settlement agreement, the NERC BOTCC considered the fact that these were the SVP’s first violations of the relevant Reliability Standards and four of the violations were self-reported. URE was also cooperative during the enforcement process, did not conceal the violations and engaged in voluntary corrective action to remediate the violations. Twelve of the violations posed a minimal risk to BPS reliability, and five of the violations posed a moderate risk, while none of the violations posed a serious or substantial risk to BPS reliability.

Total Penalty: $150,000 (aggregate for 17 violations)

FERC Order: Issued March 1, 2013 (no further review)

Southern California Edison – Transmission & Distribution Business Unit, FERC Docket No. NP13-54 (September 30, 2013)

Reliability Standard: PER-002-0

Requirement: 1

Violation Risk Factor: High

Violation Severity Level: Severe

Region: NERC

Issue: As part of a NERC compliance investigation into the November 7, 2008 fire in a series capacitor bank in San Diego Gas & Electric’s service territory which led to a 500 kV line being taken out of service and an excess System Operating Limit (SOL) on Path 49, NERC found that Southern California Edison – Transmission & Distribution Business Unit (SCE) did not train approximately 1.5% of its operating personnel on the new load shedding process as required. SCE had replaced, about one month before, its Energy Management System (EMS) and Telecom network, which resulted in changes to the Distribution Circuit Load Shedding (DCLS) execution process, and had not finished training its operations personnel on the new procedures. On November 7, 2008, SCE’s Grid Control Center operator attempted to implement the older procedure, which caused SCE to shed less load than requested.

Finding: NERC found that the violation constituted a moderate risk to BPS reliability since SCE did not shed the full amount of load requested by CAISO. But, CAISO was able to use other measures to respond to the incident, such as implementing load shedding by other entities, derating other lines, load shifting and bringing the 500 kV line back into service. In addition, certain SCE operations personnel had already undergone the required training, and training activities were ongoing. The duration of the violation was from October 1, 2008 through March 27, 2009. SCE agreed to the violation. In approving the settlement agreement, NERC BOTCC considered the fact that the violation was SCE’s first violation of this Reliability Standard and SCE had a compliance program in place when the violation occurred (including an annual self-audit). Load was shed during the incident. SCE was also cooperative during the enforcement process and did not conceal the violation.

Total Penalty: $5,000

FERC Order: Issued October 30, 3013 (no further review)

Southern Minnesota Municipal Power Agency, FERC Docket No. NP10-112-000 (June 2, 2010)

Reliability Standard: PER-002-0

Requirement: R4

Violation Risk Factor: High

Violation Severity Level: Not provided

Region: MRO

Issue: During a compliance audit in February 2009, MRO discovered a potential violation of PER-002-0 as all of Southern Minnesota Municipal Power Agency's (SMMPA) operating personnel did not receive at least five days per year in 2008 of emergency training and drills with realistic simulations of system emergencies. SMMPA mistakenly included as training hours time that its operating personnel spent responding to Automatic Reserve Sharing (ARS) events, even though ARS events do not qualify as realistic simulations of system emergencies.

Finding: MRO and SMMPA entered into a Settlement Agreement to resolve multiple violations, whereby SMMPA agreed to undertake mitigation measures and no penalty was imposed. MRO found that this violation of PER-002-0 did not create a serious or substantial risk to bulk power system reliability based on the size of SSMPA's Balancing Area (approximately 350 MW) and its small reserve requirements. In addition, the system operators were actually engaged in training activities (even though all of the training did not meet the specific requirements of PER-002-0). In deciding not to impose a penalty, MRO considered the fact that these violations were SMMPA's first violations of the relevant Reliability Standards and SMMPA was cooperative through the compliance process and did not attempt to conceal the violations. SMMPA has completed a mitigation plan for the violation of PER-002-0 and has undertaken other efforts to strength its compliance program.

Penalty: $0

FERC Order: Issued July 2, 2010 (no further review)

Southwest Transmission Cooperative, Inc., Docket No. NP10-79-000 (March 31, 2010)

Reliability Standard: PER-002-0

Requirement: R1, R4

Violation Risk Factor: High (for both R1 and R4)

Violation Severity Level:Not provided

Region: WECC

Issue: During an audit in February 2009, WECC discovered potential violations of PER-002-0 R1 and R4 based on Southwest Transmission Cooperative, Inc.'s (SWTC) failure to provide the necessary training in accordance with its Operating Personnel Training Program and this Reliability Standard. SWTC had not, as mandated by R1, provided 12 of its employees with the minimum number of training hours required by its training guidelines for one or more quarters since July 1, 2007. In addition, SWTC had not, as mandated by R4, provided three of its operators the equivalent of five days per year of training and drills using realistic simulations of system emergencies.

Finding: WECC and SWTC entered into a Settlement Agreement to resolve all outstanding issues related to multiple violations of the Reliability Standards, whereby SWTC agreed to pay a penalty of $44,000 and to undertake other mitigation measures. For Reliability Standard PER-002-0 R1, WECC found that the violation did not pose a serious or substantial risk to the bulk power system since only one operator did not meet the minimum number of training hours and this operator received the necessary training on other occasions. For Reliability Standard PER-002-0 R4, WECC found that the violation did not pose a serious or substantial risk to the bulk power system since two of the delinquent operators each received 30 hours of training and the other operator received 21 hours of training (out of a mandated 32 hours worth of training). In assessing the penalty, WECC considered the fact that these violations were SWTC's first assessed violations of the relevant Reliability Standards; SWTC was cooperative during the enforcement process; and SWTC has a positive compliance culture. SWTC has successfully completed Mitigation Plans for its violations of Reliability Standard PER-002-0.

Penalty: $44,000 (aggregate for multiple violations)

FERC Order:Issued April 30, 2010 (no further review)

TransAlta Centralia Generation, LLC, FERC Docket No. NP10-2-000 (October 14, 2009)

Reliability Standard: PER-002-0

Requirement: R1, R2, R3, R4

Violation Risk Factor: High (for R1, R2, R3, R4)

Violation Severity Level: Not provided

Region: WECC

Issue: In June 2008, TransAlta Centralia Generation, LLC (TransAlta) self-reported that, because it did not have NERC-certified operating personnel, it did not have a training program that met the requirements of PER-002-0.

Finding: WECC found that the violations did not pose a serious or substantial risk to the bulk power system because, under an April 2000 agreement between TransAlta and its Balancing Authority, there were relevant procedures in place (even though those procedures did not meet the requirements of PER-002-0). TransAlta would implement the directions of the Balancing Authority dispatchers, as generation and transmission operations were coordinated between TransAlta and its Balancing Authority. In addition, TransAlta and its Balancing Authority had well-established communications protocols and, in emergency situations, TransAlta agreed to respond to all of the Balancing Authority’s instructions. The violations were self-reported and they were TransAlta's first violations of this Reliability Standard. A mitigation plan has been completed.

Penalty: $0

FERC Order: Issued November 13, 2009 (no further review)

Turlock Irrigation District, FERC Docket No. NP10-18-000 (November 13, 2009)

Reliability Standard: PER-002-0

Requirement: R3

Violation Risk Factor: High

Violation Severity Level: Not provided

Region: WECC

Issue: TID did not contain all required training objectives within its training program documentation. Duration of the violation was from June 18, 2007 when the standard became enforceable through December 5, 2008.

Finding: WECC gave consideration to the fact that TID is a small entity with limited financial resources, the violation resulted in a minimal to moderate impact to the reliability of the bulk power system, the violation was TID's first of this requirement, and TID provided evidence of a superlative compliance program.

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

FERC Order: Order Denying Rehearing and Providing Clarification, issued June 21, 2012, 139 FERC ¶ 61,248 (2012); http://www.ferc.gov/whats-new/comm-meet/2012/062112/E-8.pdf

Unidentified Registered Entity, FERC Docket No. NP11-116-000 (February 23, 2011)

Reliability Standard: PER-002-0

Requirement: R4

Violation Risk Factor: High

Violation Severity Level: Lower

Region: FRCC

Issue: In August 2008, a Registered Entity self-reported that it had not given one of its System Operators five days of training in emergency operations as required.

Finding: FRCC and the Registered Entity entered into a settlement agreement to resolve multiple violations, whereby the Registered Entity agreed to pay a penalty of $75,000 and to undertake other mitigation measures to resolve multiple violations. FRCC found that the PER-002-0 violation did not constitute a serious or substantial risk to bulk power system reliability since the relevant System Operator had over 23 years of experience in System Operations and had already undergone 75 percentof the training hours required. The duration of the PER-002-0 violation was from January 1, 2008 through January 30, 2008. In approving the settlement agreement, NERC considered the fact that these were the Registered Entity's first violations of the relevant Reliability Standards; the Registered Entity self-reported some of the violations; the Registered Entity was cooperative during the enforcement process and did not conceal the violations; there was a compliance program in place; and there were no additional mitigating or aggravating factors.

Penalty: $75,000 (aggregate for multiple violations)

FERC Order:Issued March 25, 2011 (no further review)

Unidentified Registered Entity, FERC Docket No. NP11-128-000 (February 23, 2011)

Reliability Standard: PER-002-0

Requirement: R2, R3

Violation Risk Factor: High

Violation Severity Level: Not provided

Region: WECC

Issue: WECC Enforcement determined Unidentified Registered Entity (URE) was unable to provide evidence that it had a formal training procedure in place for all operating personnel in violation of R2 and moreover did not have a training procedure that implemented all the elements required by R3. URE later produced evidence of its formal training procedure, but WECC Enforcement determined URE was still in violation because it did not produce the evidence during the audit.

Finding: WECC Enforcement determined the violation did not pose a serious or substantial threat to the bulk power system because URE had a training program in place. In determining the penalty amount, the NERC Board of Trustees Compliance Committee considered the following factors: this was URE’s first occurrence of this type of violation; URE was cooperative; and the number and nature of the violations.

Penalty: $450,000 (aggregated for multiple violations)

FERC Order:Issued March 25, 2011 (no further review)

Unidentified Registered Entity, FERC Docket No. NP11-180-000 (April 29, 2011)

Reliability Standard: PER-002-0

Requirement: R4

Violation Risk Factor: High

Violation Severity Level: Lower

Region: WECC

Issue: In 2007, the Unidentified Registered Entity (URE) had given one of its operators only 30.5 hours of training (which is 1.5 hours shy of the required training amount).

Finding: WECC and the URE entered into a settlement agreement to resolve multiple violations, whereby the URE agreed to pay a penalty of $71,500 and to undertake other mitigation measures. WECC found that the violation of PER-002-0 constituted a minimal risk to bulk power system reliability since the relevant operator was an experienced transmission operator and had fulfilled the bulk of his 2007 training requirement. In addition, there were two additional operators (who had satisfied all of their training requirements) present on his shifts. The duration of the PER-002-0 violation was from June 18, 2007 through December 31, 2007. In approving the settlement agreement and the penalty determination, NERC considered the fact that the violations were the URE’s first violations of the relevant Reliability Standards; most of 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 penalty for the violation of IRO-STD-006-0 WR1 was based on a specified Sanction Table; the violations of IRO-005-2 R13 and TOP-008-1 R2 resulted from a single noncompliance occurrence; and there were no additional aggravating or mitigating factors.

Penalty: $71,500 (aggregate for 9 violations)

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

Unidentified Registered Entity (URE), Docket No. NP12-36-000 (June 30, 2012)

Reliability Standard: PER-002-0

Requirement: R1

Violation Risk Factor: High

Violation Severity Level: Lower

Region: WECC

Issue: While conducting an on-site Compliance Audit, WECC’s Audit Team found that one of URE’s 17 system operators had only received 17 hours of training versus the required 32 hours in violation of PER-002-0 R4, which was the subject of a separate enforcement action. WECC determined that URE was in violation of PER-002-0 R4 by its failure to provide at least five days of required training and to perform realistic simulations of system emergencies with the relevant operator. Based on the facts underlying the PER-002-0 R4 violation, WECC Audit Team determined that URE was in violation of PER-002-0 R1 by its failure to have all operating personnel sufficiently trained during the period of the R4 violation.

Finding: WECC deemed the issue to pose minimal risk to BPS reliability which was mitigated by the following reasons. (1) URE’s system is 1,000 miles of 345 kV which increases risk to BPS operations but URE pulled the operator from his duties once the year ended without him finishing all training. (2) The relevant operator is experienced and has NERC certification. (3) The operator had completed all training the prior year and had completed 17 hours during the year the violation occurred. (4) All other of URE’s operators had been trained pursuant to the requirements of the Standard. WECC did not assess a penalty for this violation finding no additional penalty was appropriate because its penalty for URE’s PER-002-0 R4 is a penalty that reflects the aggregate of the associated violations, and this violation was addressed separately. URE neither admitted nor denied WECC’s finding.

Penalty: $0 (URE received a $14,900 penalty for violations of CIP-004-3 R4 and PER-002-0 R4, which were the subject of a separate enforcement action)

FERC Order: Issued July 27, 2012 (no further review)

Unidentified Registered Entity (URE), Docket No. NP12-36-000 (June 30, 2012)

Reliability Standard: PER-002-0

Requirement: R4

Violation Risk Factor: High

Violation Severity Level: Lower

Region: WECC

Issue: URE self-certified that two of its operators had not received the required annual training for the calendar year; however, the operators did have enough training to keep their NERC certified or NERC recertified status. In addition, URE reported that the two operators had not received complete training on system emergencies. URE stated that once the violation came to light, and the year ended without the operators having fulfilled their training requirements, the operators were not allowed to operate URE’s system, thus ensuring that the only staff operating its system had received all annual training. WECC’s on-site compliance audit found that only one operator was at issue, not two, and WECC confirmed that the one operator had received 17 hours of training versus the required five days. WECC determined that URE was in violation of PER-002-0 R4 by its failure to provide at least five days of required training and to perform realistic simulations of system emergencies with the relevant operator.

Finding: WECC deemed the issue to pose minimal risk to BPS reliability which was mitigated by the following reasons. (1) URE’s system is 1,000 miles of 345 kV which increases risk to BPS operations but URE pulled the operator from his duties once the year ended and he hadn’t completed his training. (2) The relevant operator is experienced and has NERC certification. (3) The operator had completed all training the prior year and had completed 17 hours during the year the violation occurred. (4) All other of URE’s operators had been trained pursuant to the requirements of the Standard. In determining the appropriate penalty, WECC gave mitigating credit for URE’s internal compliance program. URE did not contest WECC’s findings.

Penalty: $14,900 (aggregate for violations of CIP-004-3 R4 and PER-002-0 R4; URE received no penalty for a violation of PER-002-0 R1, which WECC reported was a separate enforcement action)

FERC Order: Issued July 27, 2012 (no further review)

Union Power Partners, LLC FERC Docket No. NP09-13-000 (January 21, 2009)

Reliability Standard: PER-002-0

Requirement: R3.1

Violation Risk Factor: Medium

Violation Severity Level: Not provided

Region: SERC

Issue: Union Power Partners, LLC did not have a set of training program objectives referencing the knowledge and competencies necessary to apply standards, procedures and requirements to normal, emergency and restoration conditions.

Finding: No penalty was assessed for the violation because it happened during the transition period to mandatory standards and the violation would not put bulk power system reliability at serious or substantial risk. SERC also found the violation to be a documentation issue and the Union Power Partners completed a mitigation plan to avoid further violations.

Penalty: $0

FERC Order: Issued February 19, 2009 (no further review)

Western Area Power Administration – Sierra Nevada Region, FERC Docket No. NP11-86-000 (January 31, 2011)

Reliability Standard: PER-002-0

Requirement: R3

Violation Risk Factor: High

Violation Severity Level: Severe

Region: WECC

Issue: Western Area Power Administration – Sierra Nevada Region (WASN), a Transmission Operator, self-reported that it did not, as required by PER-002-0 R3, include training objectives and initial and continuing training programs in its training plan for Transmission Operators nor did it address adequate training time.

Finding: WECC determined that the violation did not pose a serious or substantial risk to the reliability of the bulk power system because WASN did have a Power System Operations Manual for its Transmission Operators in place since 2005, even though the manual was not compliant with the requirements of the Reliability Standard. The NERC Board of Trustees Compliance Committee (BOTCC) assessed no penalty for the violation. In determining no penalty was appropriate, the NERC BOTCC considered that the violation was WASN's first occurrence of violation of the subject Reliability Standard; the violation was self-reported; WASN cooperated during the compliance enforcement process; WASN had an internal compliance program at the time of the violation; and there was no evidence WASN attempted to conceal the violation.

Penalty: $0

FERC Order: Issued March 2, 2011 (no further review)