Approved Meeting Minutes Standards Committee

Approved Meeting Minutes Standards Committee April 11, 2012 8-5 p.m. Eastern April 12, 2012 8-3 p.m. Eastern Tampa, FL 1. Administrative Items The Standards Committee (SC) held a meeting on Wednesday, April 11 from 8-5 p.m. and Thursday, April 12, 2012 from 8-3 p.m. Eastern in Tampa, Florida. The agenda, attendance list and meeting announcement are affixed as Exhibits A, B and C, respectively. a. Introductions and Quorum SC Chair Allen Mosher confirmed there was a quorum, and welcomed all to the meeting. b. Conference Call Reminder and Antitrust Guidelines Maureen Long reminded all that the conference call was open to all interested parties and reviewed the NERC Antitrust Compliance Guidelines. c. SC Expectations SC Chair Allen Mosher reminded all of the SC Expectations. d. Review of Agenda Fred Plett motioned to adopt the agenda as revised (added a review of the difference between the definitions of Bulk Electric System and bulk power system to item 6dvi and a discussion of default language in the evidence retention section of standards added as item 6dvii) and to waive the 5-day rule. The committee approved the motion without objection or abstention. 2. Consent Agenda Jason Shaver asked to remove the following item from the consent agenda for discussion: Errata in NUC-001-2 Nuclear Plant Interface Coordination and PRC-001- System Protection Coordination and TOP-002-2.1b Normal Operations Planning Carol Sedewitz motioned to approve the following: a. March 6, 2012 Standards Committee s Executive Committee Meeting Minutes b. March 8, 2012 Standards Committee Meeting Minutes c. March 27, 2012 Standards Committee s Executive Committee Meeting Minutes

d. Appoint the following to the Communications and Planning Subcommittee: Scott Miller, MEAG Power John Bussman, Associated Electric Cooperatives e. Appoint the following to Communications and Planning Subcommittee leadership positions: Anne Brown, FRCC Chairman Scott Miller, MEAG Power Vice-chairman f. Appoint the following to the Process Subcommittee: Doug Holbaugh, FirstEnergy Corporation Silvia Parada Mitchell, NextEra Energy (SC Member) Andy Pusztai, ATC LLC Keith Porterfield, Georgia System Operations Corporation Robert Rhodes, SPP Katherine Smith, National Grid Joseph Tarantino, Sacramento Municipal Utilities District (SC Member) Catherine Wesley, PJM, Inc. g. Appoint the following to Process Subcommittee Leadership positions: Ben Li, Ben Li Associates, Inc. Co-chairman Linda Campbell, FRCC Co-chairman The committee approved the motion without objection or abstention. Following a discussion of the errata in TOP-002-2.1b, Fred Plett motioned to approve the following as errata, with the additional revision made during the meeting (added the word output ) Errata in NUC-001-2 Nuclear Plant Interface Coordination and PRC-001- System Protection Coordination and TOP-002-2.1b Normal Operations Planning The committee approved the motion without objection or abstention. 3. Projects under Active Development a. Status of Projects Under Active Development Andy Rodriquez reviewed the status of projects under active development and provided an explanation for the projects that are behind schedule. b. Status of Outstanding Interpretations Andy Rodriquez reviewed the status of interpretation projects under active development. Standards Committee April 2012 Meeting Minutes 2

c. Letter from Chair of Project 2007-02 Operating Personnel Communications Protocols Standard Drafting Team Linda Campbell motioned to accept the letter from the Operating Personnel Communications Protocols Standard Drafting Team, let the team narrow its focus, and direct staff to determine if there is a need to modify the work of any other team to address the concepts identified in the letter. The committee approved the motion without objection or abstention. d. Projected Posting Schedules 4. Actions Andy Rodriquez walked the committee through a table that shows the project posting of standards over the immediate three months, with a focus on the need to rearrange some project schedules to support having as few standards posted at the same time as the CIP standards. A discussion ensued on whether there are benefits to posting the standards on a more staggered schedule for the next posting of the CIP standards (expected to occur late summer 2012). Allen Mosher agreed to contact the Cyber 706 SDT and ask them to consider the following staff recommendation: Advise the Cyber 706 SDT to complete and submit work in revising its standards (projected for posting in July/August 2012) on an as ready basis, with the standards staff directed to posting CIP-002 before other standards in the CIP series. a. Revised SAR for Project 2011-INT-02 Interpretation of VAR-002 for Constellation Alice Ireland motioned to authorize posting a revised SAR and changes to VAR-002 Generator Operation for Maintaining Network Voltage Schedules for a successive ballot to address the additional stakeholder issues raised in the initial ballot. The committee approved the motion with two objections (Frank Gaffney and Fred Plett) and no abstentions. b. BES Phase 2 SAR and Schedule Linda Campbell motioned to authorize posting the revised BES Phase II SAR as final and endorse the project schedule. The committee approved the motion with no objections and one abstention (Steve Rueckert). c. Revised Project Schedules Fred Plett motioned to approve the revised project schedule for Project 2006-06 Reliability Coordination and the revised project schedule for Project 2007-02 Operating Personnel Communications Protocols. The committee approved the motion without objection or abstention. Standards Committee April 2012 Meeting Minutes 3

5. Subcommittee and Staff Reports and Activities a. Officers i) Standards Process Input Group Allen Mosher provided a status report on the work of the Standards Process Input Group (SPIG). The SPIG has collected information from a variety of sources and will present the Board of Trustees with a set of recommendations for the board to consider at its May 2012 meeting. ii) Status of ALRTF Allen Mosher provided a status report on the work of the Adequate Level of Reliability Task Force (ALRTF). The task force has prepared several documents and intends to post these for stakeholder comment by the end of April. b. Communications and Planning Subcommittee i) Mallory Huggins presented the final agenda for the April 16-18, 2012 Standards and Compliance Workshop to be held in San Diego. The Communications and Planning Subcommittee uses the input from end-of-workshop surveys to continue to make improvements to the workshops to ensure they meet stakeholder needs and expectations. Several improvements are under consideration for future workshops, including development of a Compliance 101 session for stakeholders new to compliance and an advanced track of presentations for stakeholders who want more detailed information about specific standards or compliance topics. ii) Mallory also reported on work underway to build a communication network that drafting teams can use to collect informal feedback on concepts and preliminary drafts of proposed standards; and reported that, in the future, the weekly Bulletin will include both Board of Trustees and FERC approval dates. The subcommittee is preparing to provide communication support to various standards-related activities, including use of drafting teams to assist with reliability standard audit worksheet (RSAW development), issues associated with Real-time system operator communications protocols, and response to the Find, Fix and Track Order. c. Process Subcommittee i) Cost Effectiveness Assessment of Projects and Standards Guy Zito provided an overview of the Cost Effective Analysis Process (CEAP) developed initially by NPCC, and then modified by the Process Subcommittee for use with development of continent-wide standards. Following a lengthy discussion, Brian Murphy motioned that prior to requesting a posting of the draft CEAP for stakeholder comment, the drafter shall meet with members of NERC staff, FERC staff, and a sample population of registered entities and/or trade associations for additional dialog and bring back an updated draft to the Standards Committee for posting, with all feedback provided back to the Standards Committee s Executive Committee by April 27, 2012. Standards Committee April 2012 Meeting Minutes 4

The committee did not approve the motion, with votes cast as follows: Affirmative: John Bussman, Frank Gaffney, Brian Murphy, John Anderson, Fred Plett Negative: Carol Sedewitz, Steve Myers, Al DiCaprio, Randy Castello, Scott Miller, Alice Ireland, Michael Goggin, Steve Rueckert Abstain: Joseph Tarantino, Linda Campbell, David Kiguel Fred Plett motioned to post the draft CEA process for stakeholder comment for 60 days. The committee approved the motion without objection or abstention. The Committee recommended posting the CEA document so that the posting starts May 6, 2012 and ends two weeks after the posting for the ten CIP standards. ii) Drafting Team Input to Reliability Standard Audit Worksheets Linda Campbell provided an input to the work underway since the last Standards Committee meeting. Laura Lee attended the CCC meeting and reported on the RSAW effort, where it received unanimous endorsement from the CCC. Linda reported that she will make a presentation on the RSAW effort during the May 2012 Board of Trustees Compliance and Certification Committee. Linda also reported that the RSAW team is still looking for a drafting team to field test the process, and expects to begin the field test following the May board meetings. iii) VRF and VSL Proposals Terry Bilke provided background on both the Violation Risk Factor (VRF) project and the Violation Severity Level (VSL). Herbert Schrayshuen expressed concerns that the projects were consuming resources at a time when the future standard template may not include VRFs and VSLs as used today. Following a lengthy discussion, Scott Miller moved that, in recognition of NERC staff s concern on resource impact and the ongoing effort of the Standard Process Improvement Group (SPIG) to improve the standards development process, the Standards Committee recommends to the Compliance and Certification Committee and the VRF/VSL team: Suspend development of improvements to the VRF and VSL criteria Ask that the SPIG take the work already done by the VRF/VSL team for possible use as a starting point for any team charged with assessing and revising the essential elements of the standard template The committee approved the motion with Jason Shaver, David Kiguel and Alice Ireland opposed and no abstentions. iv) Other Activities for 2012 Ben Li reported that work continues in refining the Rapid Revision Process and the Single Portal Process, with a goal of brining both to the Standards Committee s July 2012 meeting. Standards Committee April 2012 Meeting Minutes 5

Ben also reported that in anticipation of having the SPIG assign the Standards Committee to assist in developing revisions to the standard development process, the Process Subcommittee has formed four teams with a goal of completing a draft product by June 1, 2012. Team assignments are: d. Staff Reports Team 1: Analyze areas of the current process that exceed or partially exceed ANSI Essential Requirements, and develop recommendations on which of those are necessary to keep and where we could streamline the process without negative consequences Team 2: Review essential elements of a standard and develop recommendations concerning which elements could be eliminated Team 3: Make recommendations for simplifying the balloting/commenting process Team 4: Develop draft criteria for evaluating whether a No vote in a ballot should be counted in calculating the ballot approval i) Incorporating Consideration of Internal Controls into Standards or RSAWs Michael Moon provided an explanation of what compliance operations calls, internal controls those processes a responsible entity implements to check and correct its own performance; and identified how these internal controls can be identified in various documents, including standards and RSAWs. ii) Response to Find, Fix and Track Order Herbert Schrayshuen identified work underway to respond to Paragraph 81 of the Find Fix and Track Order issued by FERC on March 15, 2012, which invited NERC to identify requirements that may be retired without adversely impacting reliability. Herb reported that a cross-functional team of NERC staff members is working to establish and apply a set of criteria to existing requirements to identify a set to propose for retirement. The proposal will then be vetted with the Regions, stakeholders, and FERC staff before a formal recommendation is formed. As envisioned, the retirements will be implemented within the context of the prioritized standards development plan. iii) ISO/RTO Council s Appeal for Inaction on NWPP Request for an Interpretation of BAL- 002 Disturbance Control Performance Herbert Schrayshuen reported that he investigated actions taken by the Standards Committee and the standards staff in response to the request for interpretation, and did not find grounds for the appeal. The interpretation can not be developed within the strict construction of the requirements clarifying language is found in the compliance section of the standard and in other guidance documents. Albert DiCaprio provided a technical explanation of the potential for an adverse reliability impact of a literal interpretation of the requirements in BAL-002. After discussion, the committee recommended asking the board for relief (on a case-bycase basis) from the board s Nov 2009 strict construction guidance, and suggested that Standards Committee April 2012 Meeting Minutes 6

for V0 requirements where a cut and paste was done to take existing Operating Policies/Planning Standards and move the information from the Policies into various sections of V0 standards. Interpretation Drafting Teams should be allowed to use the materials associated with the predecessor Operating Policies and Planning Standards when developing an interpretation. Herb agreed to add this item to the May 2012 BOT Standards Oversight and Technology Committee. iv) Update on ERO Response to Cold Weather Event Herbert Schrayshuen provided an update on the ERO s response to the February 2011 cold weather event that affected over 200 generators. Herb reported that he is leading an effort to review the recommendations from the cold weather event to determine which recommendations, if any, should be translated into enforceable requirements, and solicited volunteers to assist in this effort. v) Directives Report David Taylor provided an overview of the Directives Report that NERC is required to file with FERC each March. The report identifies NERC s progress in responding to directives, and includes projections for addressing outstanding directives. Dave has been working with FERC staff to achieve consensus on list of directives and the specific content of each directive, and reported that he has reached consensus on all but a few of the CIP-related directives. vi) Definitions Glossary Versus Rules of Procedure Andrew Dressel explained that when a standard uses a term that is defined in both the Glossary of Terms Used in Reliability Standards and the Rules of Procedure, the definition included in the Glossary of Terms Used in Reliability Standards is the authoritative source. Regional Reliability Organization Versus Regional Entity; NERC Versus Electric Reliability Organization Andrew Dressel provided explanations of the various terms used to reference the Regional Reliability Organization (RRO), Regional Entity (RE), NERC, and the Electric Reliability Organization (ERO). Andy cautioned that while drafting teams may write requirements that apply to the RE and to the ERO, these requirements are enforced under the Rules of Procedure Rule 100, not through the same compliance monitoring and assessment processes applied to registered entities. Andy recommended that drafting teams consult with NERC s legal staff before writing such requirements. Bulk Power System Versus Bulk Electric System Andrew Dressel provided an explanation of the difference between the terms bulk power system (BPS) and Bulk Electric System (BES). Both NERC and FERC have authority over the BPS, which reaches farther than those facilities that are included in the BES. Andy reported that standards should be written to apply to the BES (or portions of the BES), but may also include other elements necessary for the reliable operation of the bulk power system. Standards Committee April 2012 Meeting Minutes 7

vii) Default Language in the Evidence Retention Section of Standards The standards staff has advised drafting teams to include default language in the evidence retention section of standards to caution that the Compliance Enforcement Authority may ask an entity to provide evidence that it was compliant for the full time period since the last audit, without regard to the specific evidence retention period identified in the standard. This default language was added to support a change to the Rules of Procedure that went into effect in 2011. Prior to that time, the Compliance Enforcement Authority was limited to asking for the evidence collected during the retention period specified in the standard. Standards Committee members questioned the need for this and asked that staff consider rephrasing this default language, as it may unnecessarily date the standard if the Rules of Procedure is modified in the future. 6. Coordination a. Coordination with Regulatory and Governmental Authorities Andy Dressel reported on recent Filings/Orders with regulatory and governmental authorities. b. Coordination with Regional Managers Herbert Schrayshuen reported on significant items that will be reported during the May 2012 BOT meetings: Analysis of the status of regional standards development in each Region Analysis of the various approaches to UFLS program management in each Region In addition, Herb reported that he has been asked by NERC and Regional executives to review the charter of the Regional Standards Group and change the governance so that the chair is an appointed position, and will address whether meetings should be open or closed. c. Update on Coordination with Regions in Developing Regional Standards and Variances Howard Gugel reported that the white paper on variances and coordination of regional standards development activities is still under review. 7. Executive Committee Actions Fred Plett moved that the Standards Committee authorize its Executive Committee to act on the following, if presented to the Standards Committee before its April 11-12, 2012 meeting. Add members to CIP IDT Endorse First Quarter Ballot Results Report SAR and Standard for Rapid Revision to BAL-002 - Disturbance Control Performance Interpretation of EOP-005-2 Requirement R6 for Lincoln Electric System SAR for Statutory Definitions to Meet Directives SAR for Revisions to PER-005 Standards Committee April 2012 Meeting Minutes 8

8. Adjourn The committee approved the motion without objection or abstention. New Action Items 1. Develop and issue a policy statement identifying any restrictions on the use of Registered Ballot Body list servers. (NERC Legal) 2. Develop an estimate on industry and staff resources to develop VSLs. (Herbert Schrayshuen) 3. Review the Errata Procedure to see if there is an opportunity to revise and expand the scope to address other reasonable modifications, such as updating violation risk factors and violation severity levels. (Process Subcommittee) 4. Post the Background Information document used during Quality Reviews on the Standard Resources web page. (Standards Staff) 5. BAL-004 Time Error Correction Determine if there is a need to file a status report. (Standards and Legal Staff) 6. Provide drafting team leadership with a copy of the Standards Committee s Procedure for Approving Supporting Documents. (Standards Staff) Standards Committee April 2012 Meeting Minutes 9