US Energy Regulator Directs Extreme Weather Plans and One-Time Weather Readiness Reports

In companion orders issued on June 15, 2023, the US Federal Energy Regulatory Commission (“FERC”) has (1) directed the North American Electric Reliability Corporation (“NERC”), its designated reliability organization, to develop extreme weather reliability requirements (the “NERC Order”)¹ and (2) ordered all US regulated transmission owners and transmission service providers to submit weather readiness reports in advance of the winter 2023-24 season (the “Reporting Order”).²

What’s Required of NERC

The NERC Order establishes an 18-month timeline for NERC to develop general weatherization rules and standards under Reliability Standard TPL-001-5.1, requiring transmission system planning for extreme heat and cold weather events that impact the Reliable Operation of the Bulk-Power System. Compliance requirements will largely be targeted to transmitters and not to generation or distribution entities.

The NERC Order requires:

(1) Developing benchmark planning cases based on prior major extreme heat and cold weather events and/or meteorological projections;

(2) Planning for extreme heat and cold weather events using steady-state and transient-stability analyses covering a range of extreme weather scenarios, including the resource’s expected availability during extreme heat and cold weather conditions and the wide-area impacts of extreme heat and cold weather; and

(3) Developing corrective action plans that mitigate any instances where performance requirements for extreme heat and cold weather events are not met.

Timeline

NERC must submit the proposed reliability standard within 18 months of the date of publication of the NERC Order rule in the Federal Register. With publication likely in June or July 2023, the proposal will likely not be submitted before December 2024, following what may be an intricate and contentious NERC stakeholder consultation process. NERC must also develop a phased-in implementation timeline for the different requirements of the reliability standard (i.e., developing benchmark planning cases, conducting studies, developing corrective action plans) beginning within 12 months of the effective date of a FERC order approving the proposed reliability standard. Therefore, barring procedural extensions, the implementation timeline is not expected to be completed until late 2025.

What’s Required of Transmission Providers

The Reporting Order is effectively an interim measure bridging to the development and implementation of the reliability standard. It requires that regulated transmission providers³ report to FERC on current or planned policies and processes for conducting extreme weather vulnerability assessments. These reports must include descriptions by the transmission provider of:

(1) The scope of the weather events it considered in its planning;

(2) The weather informational study inputs it considered;

(3) An explanation of how weather-related vulnerabilities are identified;

(4) An explanation of how costs of extreme weather events and preparations for extreme weather events are developed; and

(5) How it develops mitigation plans and shares mitigation planning efforts and information with customers, transmission system users, interconnected generators, and interconnected utility systems.

Timeline

Transmission providers must file these one-time reports within 120 days of the Reporting Order being published in the Federal Register, likely meaning these reports will be filed in October 2023.

Use TBD

FERC has not indicated how it intends to use the information submitted in the reports but noted that the reports are generally not intended to include confidential information—the reports are to disclose plans and practices, not to publicly release vulnerabilities. Once FERC receives the reports, FERC will determine what (if an

¹ Transmission System Planning Performance Requirements for Extreme Weather, Docket No. RM22-10-000, 183 FERC ¶ 61,191 (2023).

² One-Time Informational Reports on Extreme Weather Vulnerability Assessments, Climate Change, Extreme Weather, and Electric System Reliability, Docket No. RM22-16-000, 183 FERC ¶ 61,192 (2023).

³ This includes transmission-owning utilities and FERC-regulated regional transmission and independent system entities.