1. 1 Compliance Report WECC Annual Meeting April 20, 2006 Steve Rueckert Director, Standards and Compliance

2. 2 Presentation Overview Compliance Results (RMS and NERC CEP) –Final results –Trends 2006 Compliance Enforcement Program 2007 and Beyond – Mandatory Compliance

3. 3 2005 Results WECC reported a total of 262 violations –150 violations of requirements of the 2005 NERC CEP 42 repeat offenders!! –129 WECC RMS violations –17 violations were an overlap of CEP and RMS requirements

4. 4 RMS - 2005 vs. 2004 Reported violations –522 in 2004 was reduced to 129 in 2005 Biggest improvements –Unscheduled Flow Mitigation (USF) violations were reduced from 349 to 65

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6. 6 RMS - 2005 vs. 2004 Biggest improvements –Balancing Authority Operator Certification violations were reduced from 52 to 15 None in September – December Still 2 Transmission Operators in violation

7. 7 NERC CEP - 2005 vs. 2004 Reported violations –129 in 2004 vs. 150 2005 –Different subset of standards assessed –2005 total includes violations identified during Readiness Audits

8. 8 2006 Compliance Program April 4-5, 2006 Workshop –Well attended 60-70 participants –NERC Staff presentation on ERO –Looked at 2006 as well as 2007 and beyond –Two breakout sessions –Reporting requirements and due dates similar to 2005

9. 9 2007 and Beyond Change is coming! Participation is no longer an option Standards are applicable to all users, owners, and operators of the Bulk Electric System Registration of responsible entities is underway –Identifies who is responsible –Failure to register does not relieve organizations from their responsibility to comply Outreach and Education

10. 10 2007 and Beyond Utilize existing tried and proven RMS procedures and process Future of the RMS Program Work with Canadian and Mexican authorities Field test of NERC Sanctions Table

11. 11 ERO Sanction Table Severity of Violation Risk Low Level 1 Moderate Level 2 High Level 3 Severe Level 4 Low$1,000$3,000$6,000$10,000 Medium$5,000$15,000$25,000$40,000 High$35,000$50,000$70,000$100,000

12. 12 Compliance Report WECC Annual Meeting April 20, 2006 Questions?