Mandatory Reliability Standards (MRS) Assessment Report No. 10 Workshop Teleconference Bridge Details:   604-899-2339 (Vancouver) 1-877-385-4099 Toll Free (outside Vancouver) Participant Password:  8128442# January 13, 2017

WELCOME REGULATORY Scott Tone RELIABILITY COMPLIANCE Patricia Robertson Vijay Raghunathan Sub section slide – option 2 Use this sub section slide if you are printing several copies of the presentation. 2

WORKSHOP AGENDA Topic Timing Overview and Purpose ~2 mins. Standard Development/Adoption Background ~10 mins. Assessment Report Scope and Feedback Process ~40 mins. Sources of Information ~5 mins. Closing Summary ~ 5 mins. Question and Answer ~15 mins. Sub section slide – option 1 3

OVERVIEW AND PURPOSE MRS BACKGROUND Federal Energy Regulatory Commission (FERC) North American Electric Reliability Corporation (NERC) Western Electricity Coordinating Council (WECC) British Columbia Utilities Commission (BCUC) MRS IN BRITISH COLUMBIA MRS Legislation and Framework in B.C. MRS Assessment Reports and Filing Process ASSESSMENT REPORT SCOPE AND FEEDBACK PROCESS Assessment Report No. 10 Scope and Deadlines for Feedback How to Provide Feedback How Feedback is Incorporated and Considered Sub section slide – option 2 Use this sub section slide if you are printing several copies of the presentation. 4

STANDARD DEVELOPMENT & COMPLIANCE North American Electric Reliability Corporation Responsible for developing and enforcing the Reliability Standards. Federal Energy Regulatory Commission Responsible for compliance legislation with NERC/WECC standards. British Columbia Utilities Commission Responsible for how the legislation is applied and enforced in British Columbia. Administrator for the BCUC: Audit Registration Violation monitoring . Western Electricity Coordinating Council Responsible for coordinating and promoting system reliability including auditing.

MRS IN BRITISH COLUMBIA MRS LEGISLATION IN B.C. 2007 British Columbia Energy Plan Included a Policy Action to “ensure that the province remains consistent with North American transmission reliability standards” Utilities Commission Act The provincial government amended the Act to include Section 125.2 to establish the adoption of MRS in B.C., give the BCUC jurisdiction to adopt MRS for application in B.C., and assign BC Hydro the responsibility to review each MRS and report on their suitability for adoption in B.C. MRS standards may only be fully adopted or rejected by the BCUC MRS Regulation The provincial government issued the MRS Regulation which prescribes the entities that are subject to the MRS and directs BC Hydro to provide a report to the Commission within one year after MRS are adopted by FERC

MRS IN BRITISH COLUMBIA MRS REPORT FILING PROCESS Upon receipt of the assessment report the Commission makes the report available to the public for comment The Commission considers any comments received in reply to the publication MRS ADOPTION IN B.C. The Commission must adopt the MRS assessed in the report if the Commission considers that the MRS are required to maintain or achieve consistency in B.C. with other jurisdictions that have adopted the MRS The Commission Is not required to adopt a MRS if the Commission determines, after a hearing, that the MRS is not in the public interest

MRS IN BRITISH COLUMBIA MRS COMPLIANCE The B.C. government has vested the BCUC with the authority and the responsibility for MRS compliance and enforcement The BCUC has the ability to levy monetary penalties for MRS violations The Rules of Procedure and Compliance Monitoring Program sets out the administrative framework for the monitoring of compliance with adopted MRS in B.C. The BCUC has an administration agreement with WECC to assist with monitoring compliance and registration

ASSESSMENT REPORT NO. 10 SCOPE Covers standards and Glossary Terms approved by FERC between December 1, 2015 and November 30, 2016. 7 new and 30 revised standards including: CIP Version 6 (Low Impact BCS requirements, Transient Cyber Assets and Removable Media) COM-001-3 (Communications) PRC-005-6 (Addition of Auto-Recloser and Sudden Pressure Relays to Protection System Maintenance) TOP-001-3 (Transmission Operations) TOP-002-4 (Operations Planning) TOP-003-3 (Operational Reliability Data) TPL-001-4 (Transmission System Planning Performance Requirements) * COM-001-3 – increased obligations for inter-Control Center and field-to-Control Center communications TOP-001-3/TOP-002-4 - Update with new definitions for Operator Area and Operating Instructions. Include new requirements for monitoring and managing System Operating Limits. Enhance data sharing. TOP-003-3 -  Update with new definitions for Operational Planning Analysis, Real-time Assessment and include reference to System Operating Limits Expanded requirement to include non-BES data and external network data Upgraded notification and communication requirements *This standard was originally included per Assessment Report No. 8 and is now up for reassessment per BCUC Order R-38-15. A separate TPL-001-4 Assessment Report will be filed to the BCUC.

FEEDBACK INSTRUCTIONS Feedback request email sent on December 16, 2016 to all 29 BCUC MRS registered entities per BCUC’s list dated November 2, 2016. Deadline for feedback is end of business on February 28, 2017. Feedback received after this date will NOT be considered. New standards, Glossary of Terms and Redlines can be found on the BC Hydro Reliability website here (link in feedback request email): https://www.bchydro.com/energy-in-bc/our_system/transmission/transmission-system/reliability.html

BC HYDRO RELIABILITY WEBSITE To update slide materials published and uploaded to the external site

FEEDBACK SURVEY FORMS Walk through Glossary and Standards Feedback Survey Forms

FEEDBACK INCORPORATION If feedback is unclear, BC Hydro will contact entities and ask for revisions. BC Hydro will NOT make changes to entity feedback without explicit written permission from an entity. Otherwise, feedback forms are taken verbatim and appended to the Assessment Report for the BCUC’s reference. Comments are evaluated against the following criteria established since Assessment Report No. 1 to see if they identify: Adverse Reliability Impacts: Less stringent requirements than currently adopted BCUC standards or practices otherwise mandated in utility tariffs or business practices approved or endorsed by the BCUC.

FEEDBACK INCORPORATION Suitability Assessment (Technical/Administrative): Issues with requiring NERC Approval/Participation in order to implement. Issues with ongoing provision of information to NERC or WECC due to lack of clarity on reporting instructions, references to undefined processes or reporting tools, etc. References to standards/Glossary terms that are not yet FERC/BCUC approved or otherwise under BCUC assessment. Any other issues that would affect an entity’s ability to implement the requirements of a standard/Glossary Term (i.e. Planning Authority/Planning Coordinator input required for which the role(s)/responsibilities are under consideration by the BCUC).

FEEDBACK INCORPORATION CONT’D. Comments that will NOT be considered as part of BC Hydro’s recommendations: Any issues not falling under the criteria of ‘Adverse Reliability Impact’ or ‘Suitability Assessment’ previously defined. Examples: Issues with entity functional registrations; Requests to change standard language or Glossary Terms/definitions as the BCUC does not have the authority to draft standards/Glossary Terms or make changes. REMINDER: All comments will still be kept verbatim; just not considered as these are out of scope of the established Assessment Report process. Please discuss with the BCUC separately.

FEEDBACK INCORPORATION CONT’D. All provided costs are aggregated and summarized in the body of the Report. Implementation time recommendations are based on entity feedback in combination with FERC approved recommended implementation times. Implementation times for new Glossary Terms will typically be recommended to coincide with recommended implementation times of associated standards.

CLOSING SUMMARY NERC as well as Regional Entities (WECC) develop MRS FERC must approve a MRS before it is assessed for adoption in B.C.; FERC does NOT have jurisdiction in BC Every year BC Hydro, with feedback from Registered Entities, reviews each MRS assessing the suitability for adoption in B.C. and files a report with the BCUC. The BCUC must adopt the MRS assessed in the report unless after a hearing it determines that the MRS is not in the public interest Assessment Report No. 10 Feedback Due: February 28, 2017

QUESTIONS AND ANSWERS

SOURCES OF INFORMATION BCUC MRS website: www.bcuc.com/mrs.aspx NERC website: www.nerc.com WECC website: www.wecc.biz NERC/WECC hosted standards drafting/implementation and compliance webinars WECC Compliance User Group meetings (CUG/CIPUG) Western Interconnection Forum (WICF) (http://www.wicf.biz/)

Thank you For further information or questions on Assessment Report No. 10, please contact: BC Hydro Reliability Standards BCHydroReliabilityStandards@bchydro.com Patricia Robertson, Reliability Compliance Manager Patricia.Robertson@bchydro.com (604) 455-4233 Vijay Raghunathan, Senior Reliability Compliance Specialist Vijay.Raghunathan@bchydro.com (604) 516-8958