Informal Development & Five-Year Review Team Efforts NSRS/RSC – June 2013

2 Informal Development Efforts ●Part of the 2013 work plan, an informal effort is currently underway to support the resolution of FERC directives ●The informal efforts will transition to a formal standards development project, which will include the formal comment and ballot processes ●The possible ways to resolve a FERC directive may be to  implement the directive as stated,  provide a solution that offers an equally efficient and effective method of addressing the concern, or  provide justification why the directive has been overcome by events and is no longer needed. ●There are currently 5 informal development efforts underway NSRS/RSC Meeting June 26, 2013

3 Informal Development Efforts (cont.) ●The informal development process will last 2-3 months and it will:  Identify issues and present options for resolving  Build consensus using webinars, conferences, outreach…  Provide ongoing Quality Review  Propose SAR, Standard(s), RSAWs, Implementation Plan, VRFs/VSLs  Present to SC for transition to formal development NSRS/RSC Meeting June 26, 2013

4 Five-Year Review Team Efforts ●Per the Standard Processes Manual NERC must conduct five-year reviews on standards that are more than five years old and have not yet been revised through other standards development projects ●In 2013, all standards that have not been significantly revised or retired will undergo a comprehensive review to determine whether the standard should be  Reaffirmed,  Revised, or  Withdrawn ●Five-year reviews will ultimately deliver a recommendation to the Standards Committee  If a five-year review team recommends that a standard be revised, it is expected that the review team will propose a preliminary scope for those revisions ●There are currently 4 five-year review projects underway NSRS/RSC Meeting June 26, 2013

5 Five-Year Review Team Efforts (cont.) ●The five-year review process will last ~4 months and it will:  Incorporate Paragraph 81 principles  Address previous stakeholder requests for clarity or revision  Consider use of internal controls (self-correcting language)  Ensure standard(s) reflects Results-Based Standards (RBS) principles  Evaluate whether any regulatory directives require specific changes to the standard  Evaluate whether each standard is clear, concise, and technically sound given current technologies and system conditions NSRS/RSC Meeting June 26, 2013

6 Difference between FYRT and the Informal Ad Hoc Groups? ●The ad hoc groups are working on projects that have already been scoped, and they are doing informal pre- work before that work shifts into a planned formal development phase ●Five-year review teams are identifying whether there is work to do on a set of standards, or reviewing a previously-defined scope of work to be sure it is still an appropriate direction given results-based and paragraph 81 considerations; and their review may or may not lead to formal standards development  If the standards assigned to five-year review teams have outstanding directives associated with them, the five- year review team must propose an approach to addressing the directives as part of their review NSRS/RSC Meeting June 26, 2013 Questions and Answers Questions and Answers (Updated May 20, 2013)

Jim Bowles (ERCOT) Member of Ad Hoc Group PER – Informal Development Effort Meeting Title (optional)

8 ● PER revised suggestions:  Extend applicability to Generator Operators at a local control center who receive direction from the BA or TOP and develop specific dispatch instructions for the plant operator  Extend applicability to operations personnel and support personnel  Defined local transmission control center by extending applicability to Transmission Owners  Created a requirement to cover the implementation directive for simulation technology  Providing technical justification as to why EMS personnel will not be included in the suggested standard  Removed 32 hours due to it being inherent to the SAT process, P81, and a legacy of the 2003 blackout  Modified standard to use “each calendar year” in place of “At least every 12 months” and “annual evaluation” PER Standard Update

9 ● Key Dates  June 20-21, 2013 – Last PER face-to-face Ad Hoc group meeting  July 2013 – Submit PER pro forma standard, RSAW, and Standards Authorization Request to the Standards Committee for approval to post and move into 30-day formal comment period  August 2013 – Recirculation Ballot  November 7, 2013 – Board of Trustees Adoption  December 31, 2013 – File with FERC PER Standard Update

Jen Fiegel (Oncor) Member of Five-Year Review Team (FYRT) EOP – Five-Year Review Meeting Title (optional)

11 EOP Fiver Year Review ●Emergency Operations Plan  June 28th – Initial Team Input  July 10 th & 11 th – EOP Team Session (Atlanta)  July 22 nd – EOP Recommendation issued to Industry for comment  October 3 rd – Final Recommendation presented to Standards Committee ●Cross Standard Collaboration  PRC-001  Other NSRS/RSC Meeting June 26, 2013

Lisa Martin (Austin Energy) Observing Ad Hoc Group activities MOD A – Informal Development Effort Meeting Title (optional)

13 MOD A (MOD-001, -004, -008, -028, -029 & -030) ●These standards are not applicable in the ERCOT region ●Effort combines all into MOD ●The draft standard includes the following NSRS/RSC Meeting June 26, 2013

Larisa Loyferman (CenterPoint Energy) Observing Ad Hoc Group activities MOD B – Informal Development Effort Meeting Title (optional)

15 NSRS/RSC Meeting June 26, 2013 ●Effort led by Steven Noess, NERC Standards Developer ●May 9, June 18 th and June 25 th conferences. ●Proposed approach Consolidate MOD-010 through MOD-015 into a single Modeling Standard for data collection for steady-state, dynamics and short circuit Require Planning Coordinators (PCs) to develop data requirements and reporting procedures for data owners in their planning area Use Attachment approach for data requirements Create a separate System Validation Standard ●Emphasis on proposals to address outstanding FERC directives, and recommendations and whitepapers of different NERC Planning Committees  1 Directive from FERC Order No. 890  14 Directives from FERC Order No. 693  August 14, 2003 and subsequent blackout recommendations (Sept. 18, 2007 & Sept. 8, 2011)  Integration of Variable Generation Task Force (IVGTF) recommendations (April 2009)  Model Validation Task Force (MVTF) now Modeling Working Group (MWG) whitepaper recommendations (Dec. 2010)  NERC SAMS whitepaper recommendations (Dec. 2012) MOD B (MOD-010 through MOD-015)

16 MOD B (MOD-010 through MOD-015) NSRS/RSC Meeting June 26, 2013 ●Proposed Single Modeling Standard MOD-TBD-01  Requirement R1: Requires each PC, in conjunction with each of its Transmission Planners (TPs), to develop data requirements and reporting procedures, including specification of data required (Attachment 1), data format, shareability, level of detail, case types, and schedule. Attachment 1: Specifies a three column detailed matrix of data requirements for steady-state, dynamics, and short circuit data  Requirement R2: Requires steady-state, dynamics, and short circuit data to be provided to PCs and TPs according to the data requirements developed in Requirement R1.  Requirement R3: Requires entities that submit data to provide responses to certain usability or technical concerns when notified by PC or TP ♦Provide either updated data or an explanation with a technical basis for maintaining the current data; ♦Provide additional dynamics data describing the characteristics of the model such as block diagrams, values and names for all model parameters, and a list of all state variables; and ♦Provide the response within 30 calendar days (unless a longer time period agreed upon with PC or TP)  Requirement R4: To facilitate creation of interconnection-specific models, requires PC to submit data collected under Requirement R2 to NERC or NERC’s designee(?)

17 MOD B (MOD-010 through MOD-015) NSRS/RSC Meeting June 26, 2013 ●Proposed System Validation Standard MOD-TBD-02 (not a duplicate of other standards)  Requirement R1: Each PC must implement a documented process to validate the data used for steady state and dynamic analyses (the data submitted under MOD-TBD-01 standard) for its planning area against actual system responses that includes, at a minimum, the following items: Validate its portion of the system in the power flow model by comparing it to a state estimator case to check for discrepancies that the PC determines are large or unexplained at least once every 24 calendar months and through simulation of a local event, if any. Validate its portion of the system in the dynamic models at least once every 24 calendar months and through simulation of a dynamic local event, if any. Complete the simulation within 12 calendar months of the local event. Confirm or correct the model for accuracy in coordination with the data owner(s) when the PC determines the discrepancy between actual system response and expected system performance is too large (for load flow comparison to EMS case be within 10% or 100 MW whichever is larger?). ●Minor impact on TPL  TPL references MOD-010 and MOD-012  Proposed conforming change to update cross reference with changes made in new MOD-TBD- 01

18 MOD B (MOD-010 through MOD-015) NSRS/RSC Meeting June 26, 2013 ●Key Dates (for planning purposes; subject to change)  July 2013 – Posting of the SAR for 30 day comment  July/August 2013 – Initial ballot posting: Pro-forma Standard and RSAW for 45 day comment  October 2013 – Recirculation Ballot  November 2013 – Board of Trustees Adoption  December 2013 – File with FERC ●MOD B Web site:

Lisa Martin (Austin Energy) Observing Ad Hoc Group activities MOD C – Informal Development Effort Meeting Title (optional)

20 MOD C (MOD-016 through MOD-021) ●Effort led by Darrel Richardson, NERC ●May 30 team conference call  Discussing path forward with NERC management; currently parallel paths New standard to combine MOD-016 to MOD-019 and MOD-021 –OR– Rely on NERC LTRA (Long-Term Reliability Assessments) process to gather the data  Briefly discussed using the data request option in the Rules of Procedure instead of putting data collection requirements in Standards Discussion about ROP enforceability in Canada Discussion about coordination with MOD B team  Discussion about the need for data from Demand Side Management providers that are not registered with NERC  MOD-020 needs to be rewritten but it does not necessarily belong as a MOD standard; it is more operational and perhaps should be a TOP standard ●If the group goes down the path of a standard, they will hold a webinar in late June NSRS/RSC Meeting June 26, 2013

Michael Cruz-Montes (CenterPoint Energy) Observing Ad Hoc Group activities VAR – Informal Development Effort Meeting Title (optional)

22 VAR Reactive Resources ●Last Webinar held on June 14, 2013  Included survey questions to gauge Industry Is there a reliability gap if we allow a GOP to go over 60 minutes before having to report they cannot get back in schedule? (VAR-002) ♦Yes 40% No 60% Is there a reliability gap if we allow a GOP to have 15 minutes to correct a status change? (VAR-002) ♦Yes 8% No 92% Which requirement would prevent you from supporting VAR-001? ♦R6 29%. Each Load Serving Entity that arranges for MW shall provide VARs as specified by the Transmission Owner in order to maintain the power factor range at the Point of Delivery. ♦R5 16%. The Transmission Operator shall know the status of all transmission Reactive Power resources, voltage regulators, and power system stabilizers in their system. NSRS/RSC Meeting June 26, 2013

23 VAR Reactive Resources ●Compliance Guidance Document  NERC Compliance & Informal VAR Group (IVG) Review of pro forma language Understanding of intended purpose Necessary evidence to support compliance Provide guidance for auditors Support audit consistency within the Regions  RSAWs & audit training to be developed following final approval of the Reliability Standards NSRS/RSC Meeting June 26, 2013

24 VAR Reactive Resources ●Projected Posting Schedule As of June 21, 2013  Week of July 8: (30-day comment period/30-day SAR comment period)  Week of August 19: (45-day comment period and initial ballot) NSRS/RSC Meeting June 26, 2013

Brenda Hampton (Luminant) Stewart Rake, member of Five-Year Review Team (FYRT) FAC – Five-Year Review Meeting Title (optional)

Brenda Hampton (Luminant) Pete Jenkins, member of Five-Year Review Team (FYRT) NUC – Five-Year Review Meeting Title (optional)

Lisa Martin (Austin Energy) Observing Five-Year Review Team (FYRT) activities IRO – Five-Year Review Meeting Title (optional)

28 IRO Review ●Effort led by Steve Crutchfield and Laura Anderson, NERC ●Webpage recently activated ●Held a June 3 Kickoff Meeting ●July in Charlotte (In-person meeting)  Will discuss opportunities for consolidation and/or retirement ●Future Meetings  July 22 (Conference Call)  July 25 (Conference Call-if needed)  September Charlotte, NC (In-person meeting to review comments) NSRS/RSC Meeting June 26, 2013