Reliability Standard: EOP-003-1
Requirement: 1
Violation Risk Factor: High
Violation Severity Level: Severe
Region: RFC
Issue: On the evening of June 23, 2010, PJM, American Electric Power Service Corporation's (AEP) Reliability Coordinator, experienced multiple outages on the AEP 138 kV system in the Benton Harbor area of southwest Michigan (the Kenzie Creek Event). During RFC's compliance investigation of the Kenzie Creek Event, RFC determined that when a thermal overload of the Kenzie Creek-Valley 138 kV line resulted in insufficient transmission capacity, AEP did not shed customer load as required. Instead, AEP attempted to use switching options to alleviate the condition.
Finding: RFC found that this violation constituted a serious and substantial risk to BPS reliability since it increased the chances of there being an uncontrolled failure of components and/or cascading outages of the Interconnection. The loss of the Kenzie Creek-Valley 138 kV line would have resulted in overloads on one of the two remaining 138 kV circuits, and the loss of the Kenzie Creek 345 kV/138 kV transformer would have resulted in voltage drops at four nearby buses and lines, exceeding their load dump ratings. AEP was aware of the situation and took actions to try to resolve it, even though its actions only provided a minimal amount of load relief. The EOP-003-1 R1 violation occurred for three hours and five minutes on June 23, 2010 (when the Kenzie Creek-Valley 138 kV line exceeded its emergency ratings). AEP admitted to the facts of the violations. In approving the settlement agreement, NERC BOTCC considered the fact that one of the violations was self-reported and that AEP had a compliance program in place (which was viewed as a partial mitigating factor). AEP also had two previous violations of FAC-009-1 R1. AEP was cooperative during the enforcement process and did not conceal the violations. Furthermore, AEP conducted an apparent cause analysis after the Kenzie Creek Event. In regards to the Kenzie Creek incident, one violation (FAC-009-1 R1) constituted a minimal risk to BPS reliability; five violations (COM-002-2 R2, EOP-003-1 R8, IRO-001-1.1 R8, PER-002-0 R1 and TOP-001-1 R5) constituted a moderate risk to BPS reliability; and four violations (EOP-001-0 R3, EOP-003-1 R1 and TOP-001-1 R1 and R2) constituted a serious and substantial risk to BPS reliability.
Total Penalty: $225,000 (aggregate for 10 violations)
FERC Order: Issued June 28, 2013 (no further review)
Reliability Standard: EOP-003-1
Requirement: 8
Violation Risk Factor: High
Violation Severity Level: High
Region: RFC
Issue: On the evening of June 23, 2010, PJM, American Electric Power Service Corporation's (AEP) Reliability Coordinator, experienced multiple outages on the AEP 138 kV system in the Benton Harbor area of southwest Michigan (the Kenzie Creek Event). During RFC's compliance investigation of the Kenzie Creek Event, RFC determined that, partly as a result of a lack of supervisory control in certain areas, AEP was unable to implement load shedding in an adequate time frame for responding to the emergency, even though it had developed a plan for operator-controlled manual load shedding to respond to real-time emergencies.
Finding: RFC found that this violation constituted a moderate risk to BPS reliability as AEP was unable to appropriately respond to real-time emergencies by implementing load shedding. But, AEP was aware of the situation and took actions to try to resolve it, even though its actions only provided a minimal amount of load relief. The duration of the EOP-003-1 R8 violation was from June 23, 2010 through October 24, 2012. AEP admitted to the facts of the violations. In approving the settlement agreement, NERC BOTCC considered the fact that one of the violations was self-reported and that AEP had a compliance program in place (which was viewed as a partial mitigating factor). AEP also had two previous violations of FAC-009-1 R1. AEP was cooperative during the enforcement process and did not conceal the violations. Furthermore, AEP conducted an apparent cause analysis after the Kenzie Creek Event. In regards to the Kenzie Creek incident, one violation (FAC-009-1 R1) constituted a minimal risk to BPS reliability; five violations (COM-002-2 R2, EOP-003-1 R8, IRO-001-1.1 R8, PER-002-0 R1 and TOP-001-1 R5) constituted a moderate risk to BPS reliability; and four violations (EOP-001-0 R3, EOP-003-1 R1 and TOP-001-1 R1 and R2) constituted a serious and substantial risk to BPS reliability.
Total Penalty: $225,000 (aggregate for 10 violations)
FERC Order: Issued June 28, 2013 (no further review)
American Electric Power Service Corp, FERC Docket No. NP13-37-000 (May 30, 2013)
Reliability Standard: EOP-003-1
Requirement: 8
Violation Risk Factor: High
Violation Severity Level: High
Region: TRE
Issue: TRE determined that American Electric Power Service Corp (AEP), as agent for AEP Texas North Co, AEP Texas Central Co, and Public Service Company of Oklahoma, did not timely implement and adequately maintain its load shedding obligations during the February 2, 2011 winter event as directed by ERCOT. At 5:43 am on February 2, 2011, ERCOT declared an Energy Emergency Alert 3 and directed AEP to implement load shedding in steps. AEP did not shed a sufficient amount of firm load for 17% of the time it was directed (for 82 out of 483 minutes) and had a maximum shortfall of 54% (only shed 171.3 MW when it was expected to shed 373.2 MW).
Finding: TRE found that the EOP-003-1 violation constituted a moderate risk to BPS reliability since AEP’s failure to meets its obligated load reduction negatively impacted ERCOT’s ability to mitigate the system emergency. ERCOT’s operating reserves were overstated both in absolute terms and in response characteristics. But, AEP’s maximum shortfall only account for 4.1% of the total 4000 MW firm load shed called upon by ERCOT and AEP’s load ratio share represented 9.33% of the ERCOT region’s total obligation. But, other entities in ERCOT over-performed their load shed reduction requirements (by an extra 900 MW), which compensated for AEP’s shortfall. AEP neither admits nor denies the violations. In approving the settlement agreement, NERC BOTCC considered the fact that AEP had a compliance program in place when the violations occurred (which was evaluated as a mitigating factor). And while AEP had prior violations of the Reliability Standards, it was not viewed as an aggravating factor since the prior violations did not indicate that there were any broader corporate issues involved. AEP was also cooperative during the enforcement process and did not conceal the violations. The violations did not constitute a serious or substantial risk to BPS reliability.
Total Penalty: $200,000 (aggregate for 6 violations)
FERC Order: Issued June 28, 2013 (no further review)
Board Of Public Utilities - Kansas City (BPU), Docket No. NP13-8-000, November 30, 2012
Reliability Standard: EOP-003-1
Requirement: R7
Violation Risk Factor: High
Violation Severity Level: Severe
Region: SPP
Issue: During a Compliance Audit, SPP discovered a violation of R7 when BPU, as a TOP and a BA, failed to coordinate automatic load shedding in its coverage area. Specifically, the underfrequency load shedding (UFLS) trip settings on BPU's Quindaro Units Q1 and Q2 did not align with the company's UFLS set points. The UFLS trip settings on the two units both surpassed the lowest system load shed setting, whereas they should have been set to trip at a frequency below the lowest system load shed setting.
Finding: SPP determined that the R7 violation posed a moderate risk to the reliability of the BPS because without properly coordinated UFLS settings on all generating units in the coverage area, an underfrequency event on the system would have tripped the Quindaro Units Q1 and Q2 before controlled load shedding was set to start, which would have aggravated the underfrequency event and increased the likelihood of needing additional load shedding on the system in order to recover from the event. In addition, BPU's facilities operate at relatively low voltage levels and the BPU system has only three interconnections, none of which are substantial to the BPS. Finally, a UFLS event did not occur on the BPU systems during the violation timeframe. SPP and BPU entered into a settlement agreement to resolve multiple violations, whereby BPU agreed to pay a penalty and to undertake other mitigation measures to come into compliance with R7. SPP considered BPU's internal compliance program a mitigating factor in making its penalty determination. The duration of the violation was from June 18, 2007 to April 27, 2010. BPU neither admits nor denies the R7 violation.
Penalty: $20,000 (aggregate for 2 violations)
FERC Order: Issued December 28, 2012 (no further review)
Brownsville Public Utilities Board (BPUD), Docket No. NP13-31-000 (April 30, 2013)
Reliability Standard: EOP-003-1
Requirement: 5
Violation Risk Factor: High
Violation Severity Level: Severe
Region: TRE
Issue: During a compliance audit, TRE determined that BPUD, as a TOP, did not maintain the amount of load shed that was directed by ERCOT and required by BPUB’s load shedding plan during a February 2, 2011 cold-weather related event. During the incident, BPUB’s operator did not keep enough feeders open to maintain the required load shed and was putting back in more load than it was taking out. BPUB was only keeping track of its feeders and whether they were in or out of service via a paper easel.
Finding: TRE found that the violation only constituted a minimal risk to BPS reliability since BPUB’s failure to maintain its load shed obligation was limited to 1% of its directed load shed total (0.67 MWh out of its 74.5 MWh obligation), and BPUB’s load shed obligation only constituted 0.43% of the ERCOT region load shed total. In addition, BPUB only failed to meet its obligation by 4.4 MW for 7 minutes. BPUB also deployed generation units in response to the emergency conditions. BPUB neither admitted nor denied the violation. The violation occurred on February 2, 2011. In approving the settlement agreement, the NERC BOTCC considered the fact that this was BPUB’s first violation of the relevant Reliability Standard and that BPUB had a compliance program in place (which was evaluated as a mitigating factor). BPUB was also cooperative during the enforcement process and did not conceal the violation.
Total Penalty: $10,000
FERC Order: Issued May 30, 2013 (no further review)
California Independent System Operator (CAISO), Docket No. NP13-56-000 (Sept. 30, 2013)
Reliability Standard: EOP-003-1
Requirement: R8
Violation Risk Factor: High
Violation Severity Level: High
Region: NERC
Issue: Pursuant to a Settlement Agreement entered into between the parties, CAISO was found to be in violation of multiple Reliability Standards with respect to a forced outage experienced by the Western Interconnection Bulk Electric System of the San Diego Gas & Electric (SDG&E) TL 50001 transmission line between SDG&E’s Imperial Valley and Miguel Substations, which was itself caused by a fire in a series capacitor bank. Among other violations, CAISO as the responsible entity for Southern California Edison’s (SCE) failure to shed load was found in violation of EOP-003-1, as SCE was not capable of shedding requested load in an adequate time frame.
Finding: NERC found that this violation presented a serious or substantial risk to BPS reliability as SCE’s inability in response to an emergency event to shed load in an adequate time frame prolonged the outage. In determining the appropriate penalty, NERC considered the following: (1) CAISO had not previously been subject to NERC Reliability Standards violations; (2) CAISO self-reported violations; (3) CAISO was cooperative in the enforcement process; (4) CAISO maintained a compliance program at the time of the event; (5) CAISO did not appear to hide or cover up any violation; and (6) CAISO voluntarily took additional mitigating activities which included significant investment to improve its operations and avoid future violations.
Total Penalty: $120,000 (aggregate for 6 violations)
FERC Order: Issued October 30, 2013 (no further review)
City of College Station, FERC Docket No. NP13-49 (August 30, 2013)
Reliability Standard: EOP-003-1
Requirement: 5
Violation Risk Factor: High
Violation Severity Level: Severe
Region: TRE
Issue: During a spot check, TRE found that, during a cold weather incident on February 2, 2011, City of College Station (COCS) was unable to timely achieve and maintain the amount of load shed directed by ERCOT (11.6 MW of the maximum ERCOT total load shed of 4000 MW). COCS also did not implement the load shedding in steps in order to minimize risk of uncontrolled separation, loss of generation or system shutdown. In the response to the February 2, 2011 incident, COCS experienced seven errors (with durations from 4 to 24 minutes) in executing ERCOT’s directives, and missed its load shedding obligation by as much as 90% during one 17 minute period.
Finding: TRE found that the violations constituted a moderate risk to BPS reliability since the failure of COCS to properly implement its load shed procedures caused COCS to be unable to meet its load event during the February 2, 2011 cold weather incident. In sum, COCS did not supply 9.2 MWh of its 50.3 MWh load-shed obligation for 88 minutes out of the required time of 414 total minutes. The EOP-003-1 violation occurred on February 2, 2011. COCS neither admitted nor denied the violations. In approving the settlement agreement, NERC BOTCC considered the fact that the violations were COCS’ first violations of the relevant Reliability Standard and COCS had a compliance program in place when the violations occurred (which was evaluated as a mitigating factor). COCS was also cooperative during the enforcement process and did not conceal the violations. TRE found that the violations did not present a serious or substantial risk to the BPS.
Total Penalty: $12,000 (aggregate for two violations)
FERC Order: Issued September 27, 2013 (no further review)
Lee County Electric Cooperative, Inc., FERC Docket No. NP11-266-000 (August 31, 2011)
Reliability Standard: EOP-003-1
Requirement: R3
Violation Risk Factor: High
Violation Severity Level: Severe
Region: FRCC
Issue: During an audit, FRCC determined that Lee County Electric Cooperative, Inc. (LCEC) failed to coordinate its manual load shedding plan as a Transmission Operator with other interconnected Transmission Operators and Balancing Authorities.
Finding: FRCC found that the violation did not constitute a serious or substantial risk to the bulk power system because LCEC had a manual load shedding plan in place, even though it failed to coordinate with neighboring entities as required. Duration of violation was from June 18, 2007 through October 30, 2009.
Penalty: $30,000 (aggregate for 7 violations)
FERC Order: Issued September 30, 2011 (no further review)
Louisiana Energy and Power Authority, FERC Docket No. NP11-260-000 (August 31, 2011)
Reliability Standard: EOP-003-1
Requirement: R8
Violation Risk Factor: High
Violation Severity Level: Severe
Region: SPP
Issue: During a compliance audit, SPP determined that Louisiana Energy and Power Authority (LEPA) violated R8 because it failed to authorize its systems operators to direct manual load shedding from LEPA’s members and TOPs in response to a real-time system emergency.
Finding: SPP determined that the violation posed a minimal risk but did not pose a serious or substantial risk to the reliability of the bulk power system because LEPA’s TOPs would independently be compelled to implement manual load shedding if required by a system emergency by virtue of their own NERC compliance obligations. In addition, LEPA is a small balancing authority with a peak load of approximately 220 MW and had not experienced any emergency events necessitating emergency load shedding. In approving the settlement agreement, NERC found this was LEPA’s first violation of the subject Reliability Standards, LEPA was cooperative, there was no evidence of an intent or attempt to conceal a violation; and there were no other mitigating or aggravating factors.
Penalty: $25,000 (aggregate for 4 violations)
FERC Order: Issued September 30, 2011 (no further review)
Louisiana Energy and Power Authority (LEPA), Docket No. NP12-44-000 (August 31, 2012)
Reliability Standard: EOP-003-1
Requirement: 2
Violation Risk Factor: High
Violation Severity Level: Severe
Region: SPP RE
Issue: While conducting an October 2011 compliance audit, SPP RE found that LEPA, in its role as a Balancing Authority (BA), had no automatic underfrequency load shedding (UFLS) plan. LEPA does not own or implement a UFLS program; however, as a BA, it is required to have a plan establishing which member city loads inside its BA Area would be shed (and when they would be shed) during an underfrequency event. SPP RE found that LEPA's Energy Control Center Operating Procedures manual used by system operators to perform operational activities did not discuss the operational use of UFLS relays by member cities. At the time of the compliance audit, LEPA was unaware of whether any member cities had UFLS relays. A subsequent request for information on UFLS relaying capabilities determined one member city did have UFLS relaying in place.
Finding: The violation was deemed by SPP RE to pose minimal risk to BPS reliability. System operators should be aware of what impact automatic load shedding may have in order to reliably make manual load shedding decisions. But, LEPA manages only a maximum of 185 MW of generation capacity and a 224 MW peak load which reduces any risk posed to overall BPS reliability. The member found to have UFLS relaying in place would shed only 20 MW of load in response to a frequency decline, and that amount could be even less depending on the member's load while an underfrequency event was taking place. The particular member's average load is 9.7 MW and its facilities operate at 69 kV or less. In addition, the member does not own or operate any BPS facilities. The relay was subsequently removed as it was not needed by the member's TOP or any other entity for regional automatic load shedding. LEPA neither admitted to nor denied SPP RE's findings.
Penalty: $2,500
FERC Order: Issued September 28, 2012 (no further review)
Reliability Standard: EOP-003-1
Requirement: R3, R5
Violation Risk Factor: High (for R3, R5)
Violation Severity Level: Not provided
Region: WECC
Issue: In January 2008, the National Nuclear Security Administration-Los Alamos National Laboratory (NNSAL) self-reported that it had not fully coordinated its load shedding plans with other interconnected Transmission Operators and Balancing Authorities. In addition, NNSAL self-reported that it had not implemented its load shedding in steps designed to minimize the risk of uncontrolled separation, loss of generation, and system shutdown.
Finding: WECC found that the violations did not pose a serious or substantial risk to the bulk power system since NNSAL was actually coordinating its load shedding with other entities and had a load shedding plan (even though it did not meet all the requirements of EOP-003-1). The violations were self-reported and were NNSAL's first violations of this Reliability Standard. A mitigation plan has been completed.
Penalty: $0
FERC Order: Issued November 13, 2009 (no further review)
PacifiCorp, FERC Docket No. IN11-6 (December 1, 2011)
Reliability Standard: EOP-003-1
Requirement: R1, R8
Issue: On February 14, 2008, a short circuit occurred on a transformer at PacifiCorp’s Huntington generation plant in Utah, which triggered an immediate loss of approximately 2800 MW of generation across PacifiCorp’s East Balancing Authority Area (“PacifiCorp East” – which consists of Utah, southeast Idaho and western Wyoming) and the shedding of approximately 183 MW of firm load in Utah. The incident started at 9:12 am, but PacifiCorp did not initiate firm load shedding until 10:44 am. During the incident, PacifiCorp did not enact load shedding in an adequate timeframe for responding to the emergency as required (R1). In addition, while the grid operators directed the Salt Lake Dispatch Center at 10:44 am (after alerting them to be prepared at 10:33 am) to drop 300 MW of load, PacifiCorp was only able to shed 183 MW of load in approximately 14 minutes (R8).
Finding: On December 1, 2011, FERC approved a Stipulation and Consent Agreement between FERC Office of Enforcement (“Enforcement”), NERC and PacifiCorp regarding PacifiCorp’s actions as a BA and TOP surrounding the February 14, 2008 disturbance. In terms of the EOP-003-1 R1 violation, PacifiCorp’s remedial steps were unable to timely fix its Area Control Error (“ACE”) and therefore PacifiCorp, after having taken all other remedial steps, should have promptly shed firm customer load. Since it did not, PacifiCorp risked causing an uncontrolled failure of components or cascading outages in the Western Interconnection. In terms of the EOP-003-1 R8 violation, Enforcement and NERC found that PacifiCorp, functioning as a BA, was not prepared for the emergency that occurred on February 14, 2008 and that, when responding to the emergency, it was incapable of shedding firm load in an adequate timeframe.
Penalty: $3,925,000 (aggregate for 23 violations)
FERC Order: http://elibrary.ferc.gov/idmws/common/opennat.asp?fileID=12829507
Rochester Public Utilities, FERC Docket No. NP11-254-000 (August 11, 2011)
Reliability Standard: EOP-003-1
Requirement: R8
Violation Risk Factor: High
Violation Severity Level: Moderate
Region: MRO
Issue: During a compliance audit, MRO discovered that RPU had not provided its system operators with a plan for manual load shedding for real-time emergencies even though its system operators had full authority to implement manual load shedding. Duration of violation was June 18, 2007 through February 1, 2010.
Finding: MRO determined that the violation posed a minimal risk to the bulk power system because RPU’s system operators had full authority to implement manual load shedding in an emergency, and RPU did maintain a list of critical feeders for manual load shedding even though it did not provide its operators with a plan. The NERC BOTCC also considered that: MRO originally assessed a penalty for the violations but reduced it to $0 because RPU’s proposed mitigating actions went above and beyond those required to bring RPU into compliance (RPU’s above and beyond activities include the planned purchase of $68,340 in new testing equipment and training); RPU was cooperative throughout the investigation; RPU created a compliance committee in response to the findings; and there was no evidence RPU attempted to conceal the violations
Penalty: $0
FERC Order: Issued September 9, 2011 (no further review)
Sunflower Electric Power Corporation, Docket No. NP10-61-000 (March 1, 2010)
Reliability Standard: EOP-003-1
Requirement: R8
Violation Risk Factor: High
Violation Severity Level: Moderate
Region: SPP
Issue: During a NERC Reliability Readiness Evaluation in May 2008, NERC discovered a potential violation of the Reliability Standard EOP-003-1 R8 due to Sunflower Electric Power Corporation's (SECI) lack of operator-controlled manual load shedding. Under SECI's Load Shedding Plan, System Operators, in responding to system emergencies, were required to request that SECI's cooperative members attempt to shed customer load. But, SECI's cooperative members were not available to respond on a 24-hour basis and had discretion whether they would respond to a request to shed load. Therefore, SPP determined that SECI could not implement manual load shedding in an adequate timeframe and that SECI's System Operators did not have unencumbered authority to execute manual load shedding in response to system emergencies.
Finding: SECI and SPP entered into a settlement agreement to resolve all outstanding issues resulting from the alleged violation, whereby SECI neither admitted nor denied the alleged violation, but agreed to pay a penalty of $50,000 and undertake other mitigation measures. In determining the penalty amount, SPP considered the fact that this was SECI's first violation of the Reliability Standards, and SECI was cooperative and responsive to inquiries during the enforcement process. In addition, SPP found that the alleged violation had a potential moderate risk, but only a minimal risk in actuality since SECI presented evidence that its System Operators did have the authority and capability to execute manual load shedding at the transmission level if time did not allow for coordination among the cooperative members or to avoid an uncontrolled failure of the bulk power system. The alleged violation did not create a serious or substantial risk to bulk power system reliability as it did not result in any bulk power system outages, equipment failures, limiting conditions or under-frequency events that would have required manual load shedding by SECI. SECI successfully completed a mitigation plan for the alleged violation.
Penalty: $50,000
FERC Order: Issued March 31, 2010 (no further review)
Unidentified Registered Entity, FERC Docket No. NP11-128-000 (February 23, 2011)
Reliability Standard: EOP-003-1
Requirement: R7
Violation Risk Factor: High
Violation Severity Level: Not provided
Region: WECC
Issue: Following a compliance audit, WECC determined Unidentified Registered Entity’s (URE) Under Frequency Load Shed Plan did not adhere to the established requirement in order to effectuate proper coordination with neighboring Balancing Authorities and Transmission Operators.
Finding: WECC Enforcement determined the violation posed a moderate risk to the bulk power system because the violation could have a negative impact on the Interconnection. In determining the penalty amount, the NERC Board of Trustees Compliance Committee considered the following factors: this was URE’s first occurrence of this type of violation; URE was cooperative; and the number and nature of the violations.
Penalty: $450,000 (aggregated for multiple violations)
FERC Order: Issued March 25, 2011 (no further review)
Utilities Commission of New Smyrna Beach, FERC Docket No. NP10-2-000 (October 14, 2009)
Reliability Standard: EOP-003-1
Requirement: R7
Violation Risk Factor: High
Violation Severity Level: Not provided
Region: FRCC
Issue: Utilities Commission of New Smyrna Beach's ("New Smyrna") automatic under-frequency load shedding program did not include its generating units. Duration of the violation was from June 18, 2007 when the standard became enforceable through January 21, 2009.
Finding: Penalty was deemed appropriate because this was New Smyrna's first violation of this standard, and the violation did not pose a serious or substantial threat to the reliability of the bulk power system due to New Smyrna’s location on the grid.
Penalty: $0
FERC Order: Issued November 13, 2009 (no further review)
