American Electric Power Service Corp, FERC Docket No. NP13-37-000 (May 30, 2013)
Reliability Standard: PRC-004-1
Requirement: 1, 3
Violation Risk Factor: High (1), Lower (3)
Violation Severity Level: Lower (1), Severe (3)
Region: TRE
Issue: TRE discovered numerous Protection System Misoperations in which 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 develop and implement the required Corrective Action Plan to avoid future Misoperations. These instances involved the Carbide-PUB Loma Alta M210/M220 line, the Bluff Creek and Airline Substations, the Laredo PS-Zacate Heights and Laredo PS-Anna St-Heights 138 kV lines, the Hamilton Road-Uvalde 138 kV line, and Oklaunion-Southwest Vernon 138 kV line (1). AEP had also submitted incomplete reports to ERCOT ISO (with blank Corrective Action Plan sections) for three misoperations (3).
Finding: TRE found that the PRC-004-1 violations constituted a moderate risk to BPS reliability since they show program oversights regarding the timely development and execution of Corrective Action Plans, which could adversely affect operational assessment tools such as real-time contingency analysis and an operations timeframe model. Also, some of the facilities involved in the violation serve the Laredo area, which is a transmission-constrained portion of the ERCOT grid and thus presents an increased reliability risk from operating in an unknown state. AEP had 13.3% of the misoperations in the ERCOT ISO region in 2008 and 2009 (i.e., 30 out of 225 misoperations). But, none of the misoperations resulted in a serious system disturbance or cascading failures. The duration of the PRC-004-1 violations was from February 19, 2008 through December 8, 2011 (R1) and from June 1, 2009 through December 8, 2011 (R3). 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)
Calpine Corporation and Calpine Power Management, LP, Docket No. NP12-32-000 (June 29, 2012)
Reliability Standard: PRC-004-1
Requirement: R2
Violation Risk Factor: High
Violation Severity Level: Moderate
Region: TRE
Issue: TRE initiated a Spot Check of Calpine Corporation (“Calpine Corp.”) and its subsidiary, Calpine Power Management, LP (“CPM”) (collectively, “Calpine”), on August 20, 2010 and found that a generating unit (Citgo North Oak Park Unit 3) misoperated in October 2008 due to a failure to synchronize, which tripped a generator relay. On November 3, 2008, Calpine developed a Corrective Action Plan (“CAP”). The CAP included incorrect recommendations regarding relay settings, some of which were implemented. As a result, the CAP did not prevent future similar misoperations, and four additional misoperations of the same generating unit occurred between April 11, 2009 and May 8, 2009. On May 9, 2009, Calpine implemented an effective CAP. TRE determined the duration of the violation of R2 was from November 3, 2008, the date incorrect corrective actions were implemented through May 9, 2009, when an effective CAP was implemented.
Finding: TRE determined that the violation posed a moderate risk to the reliability of the BPS because the incorrect CAP resulted in additional misoperations that could have been avoided. The violation was mitigated by the following factors: replacement capacity was available to cover the temporary loss of the BPS generation capacity associated with the tripped unit and the misoperations did not result in a state of Energy Emergency Alert; the unit was only generating approximately 62 MW output to the BPS at the time of the incidents; there was no loss of customer load; and the unit was quickly re-synchronized following each misoperation.
Penalty: $100,000 (aggregate for four violations between Calpine Corp. and its subsidiary, Calpine Power Management, LP)
FERC Order: Issued July 27, 2012 (no further review)
Gainesville Regional Utilities, FERC Docket No. NP11-105-000 (February 23, 2011)
Reliability Standard: PRC-004-1
Requirement: R1, R2
Violation Risk Factor: High
Violation Severity Level: Lower
Region: FRCC
Issue: During a Compliance Audit, FRCC reported that Gainesville Regional Utilities (GRU), as a Generator and Transmission Owner, violated PRC-004-1 when it failed to demonstrate that the Corrective Action Plans it had developed and implemented based upon misoperations that occurred on June 13, 2008 (R1) and August 22, 2008 (R2) addressed avoiding similar misoperations in the future.
Finding: FRCC and GRU entered into a Settlement Agreement in which GRU neither admitted nor denied the violations, but agreed to the assessed penalty. FRCC found that the violations did not pose a serious or substantial risk to the reliability of the bulk power system because GRU had reviewed and analyzed its Protection Systems for misoperations. The NERC Board of Trustees Compliance Committee considered the following in determining the penalty: the violations were the first by GRU of the subject Reliability Standard; GRU was cooperative during the enforcement process; and there was no evidence that GRU intended to conceal or intentionally violate the Reliability Standard.
Penalty: $45,000 (aggregate for multiple violations)
FERC Order: Issued March 25, 2011 (no further review)
Indianapolis Power & Light Company (IPL), Docket No. NP12-18 (February 29, 2012)
Reliability Standard: PRC-004-1
Requirement: R1
Violation Risk Factor: High
Violation Severity Level: Severe
Region: RFC
Issue: In August of 2009, an overhead ground (static) wire used for lightning protection to the conductor separated and fell across several of IPL’s transmission lines which in turn caused several problems such as a high impedance phase-to-ground fault, loss of distribution transformers and a boiler trip (the “Event”). IPL reported the line may have been damaged by lightning strikes to the tower during a severe thunderstorm in early August 2009.
ReliabilityFirst started a Compliance Investigation (CI) in October 2009 to find the cause of the Event. While conducting the CI, ReliabilityFirst found that during the Event IPL had three Misoperations. One, a breaker at one station opened since the line relay did not get the carrier blocking signal. This was a Misoperation as the relay operated for a fault not in a protected zone. Two other Misoperations occurred when a line primary ground relay and backup ground relay, Protection System elements, failed to trip. IPL did not recognize the Misoperations until May 5, 2010 and did not report them until May 12, 2010; however, per the requirements of the Standard, IPL, as a TO, should have recognized and reported the Misoperations on March 31, 2010. In addition, the Corrective Action Plans produced by IPL did not clearly set forth the plans for correcting the cause of the Misoperations, as required by the Standard.
Finding: ReliabilityFirst found the violations constituted a moderate risk to BPS reliability for three reasons. As reported in the Notice of Penalty, first, IPL uses the current polarizing circuit that caused the Misoperations for its primary and backup protection system schemes for a 345 kV line as well as the protection schemes of four other lines associated with one substation. Second, IPL uses similar current polarizing circuit schemes at four other substations, but they are only alike in that autotransformer tertiary windings are used for ground relay polarizing sources. Third, no other IPL substations use the summing logic or combination of multiple sources that was used at the relevant substation. ReliabilityFirst considered aspects of IPL’s compliance program and that IPL was proactive in reporting the event when determining the penalty amount. However, IPL has previous violations of PRC-005-1 R1 and R2.1 which ReliabilityFirst determined made the instant violations repeat violations and an aggravating factor.
Penalty: $15,000 (aggregate for two violations)
FERC Order: Issued March 30, 2012 (no further review)
Northern States Power (Xcel Energy) (NSP), FERC Docket No. NP13-44 (July 31, 2013)
Reliability Standard: PRC-004-1
Requirement: 1
Violation Risk Factor: High
Violation Severity Level: Moderate
Region: MRO
Issue: While conducting a spot check, MRO found that NSP, as a DP and TO, had a violation of PRC-004-1 when it was discovered that NSP failed to timely complete a Corrective Action Plan for a misoperation that occurred on June 22, 2007, at its Coon Creek-Terminal 345 kV line Protection System. According to MRO, the NSP principal specialty engineer reported that testing on certain relays may not have been completed by the August 10, 2007 deadline. NSP committed to complete a Corrective Action Plan by August 10, 2007, in order to avoid future misoperations, but NSP could not show that all required maintenance set forth in the Corrective Action Plan had been completed. MRO stated the violation period was from August 10, 2007 through March 20, 2009, when all maintenance activities set forth in the Corrective Action Plan were shown to be completed.
Finding: The violation was deemed to pose a moderate, but not serious or substantial, risk to BPS reliability. NSP could not determine whether or not the maintenance had occurred due to its failure to have a system in place to record such activities. The relevant transmission line is located in a large metropolitan area and failing to complete the requirements of the Corrective Action Plan could have affected higher voltage facilities serving the area. The risk was mitigated by the fact that some maintenance had been completed on the line relay that misoperated and the associated telecommunications. NSP neither admitted nor denied the violations but agreed to a settlement with the MRO. In determining the appropriate penalty, NSP’s compliance history was considered an aggravating factor. NSP cooperated during the enforcement procedure, and there was no evidence that NSP tried to conceal the violations nor was there evidence the violations were intentional. MRO also considered NSP’s internal compliance program.
Total Penalty: $250,000 (aggregate for four violations)
FERC Order: Issued August 30, 2013 (no further review)
Rochester Public Utilities, FERC Docket No. NP08-35-000 (June 5, 2008)
Reliability Standard: PRC-004-1
Requirement: R2
Violation Risk Factor: High
Violation Severity Level: Not provided
Region: MRO
Issue: Rochester Public Utilities had not developed and implemented a corrective action plan to avoid generator Protection System Misoperations as required by this standard.
Finding: No penalty was assessed for the violation because it happened during the transition period to mandatory standards and the violation would not put bulk power system reliability at serious or substantial risk.
Penalty: $0
FERC Order: Issued July 3, 2008 (no further review)
Sunflower Electric Power Corporation, Docket No. NP12-21, March 30, 2012
Reliability Standard: PRC-004-1
Requirement: 1, 2
Violation Risk Factor: High
Violation Severity Level: Severe
Region: SPP
Issue: Sunflower Electric Power Corporation (“Sunflower”) self-certified non-compliance with R1 during its 2010 Q2 Self-Certification Assessment because its System Protection Coordination policy was inadequate to ensure that employees would log, monitor, and analyze all transmission Protection System misoperations. SPP determined that Sunflower’s policy did not define misoperations, nor did it assign responsibilities to employees in the event of a misoperation. SPP also found that Sunflower violated R2 because there was insufficient evidence that all potential transmission and generator Protection System misoperations were addressed with a corrective plan to avoid future misoperations.
Finding: SPP determined that the violations posed a moderate risk, but did not pose a serious or substantial risk, to the reliability of the BPS. SPP found that Sunflower was vulnerable to recurring misoperations because it was not analyzing and developing corrective measures for all of its misoperations. The risk was mitigated, however, because Sunflower only has a peak load of 544 MW and is located on the Western edge of Kansas where the loss of the system would not impact the BPS. The duration of the violation was from June 18, 2007 to November 23, 2010.
Penalty: $135,000 (aggregate for 16 violations)
FERC Order: Order Issued April 30, 2012 (no further action)
The Dow Chemical Company, FERC Docket No. NP08-34-000 (June 5, 2008)
Reliability Standard: PRC-004-1
Requirement: R2, R3
Violation Risk Factor: High with respect to R2 and Lower with respect to R3
Violation Severity Level: Severe
Region: SERC
Issue: Dow self-reported that it failed to timely submit its self-certification even though it was fully compliant with the standard.
Finding: No penalty assessed because the violations occurred during the transition period to mandatory compliance and did not put the bulk power system reliability at serious or substantial risk.
Penalty: $0
FERC Order: 124 FERC ¶ 61,015 (2008), https://www.nerc.com/pa/Stand/Reliability%20Standards/NoticeOfPenaltyOrder.pdf
Unidentified Registered Entity, FERC Docket No. NP11-137-000 (March 30, 2011)
Reliability Standard: PRC-004-1
Requirement: R2
Violation Risk Factor: High
Violation Severity Level: Lower
Region: WECC
Issue: URE self-reported that two generator Protection System misoperations had occurred for which the URE had not conducted any analysis or developed any corrective action plans as required by R2. URE self-reported the violation prior to the date the Standard became enforceable, but the violation became enforceable because URE failed to submit an acceptable mitigation plan by the deadline. Duration of the violation was June 18, 2007, when the Standard became enforceable, through May 15, 2008, when the violations were mitigated.
Finding: WECC Enforcement determined that the violation did not pose a serious or substantial risk to the bulk power system because the loss of a single generator could have been handled through spinning reserve until other units were brought online if the unit had tripped. Further, the NERC BOTCC concluded the penalty appropriate because this was URE’s first violation of most of the Standards involved, URE self-reported 28 of 30 violations, and URE was cooperative during the investigation.
Penalty: $106,000 (aggregate for 30 violations)
FERC Order: Issued April 29, 2011 (no further review)
USACE – Kansas City District, FERC Docket No. NP10-2-000 (October 14, 2009)
Reliability Standard: PRC-004-1
Requirement: R1, R2, R3
Violation Risk Factor: High (for R1, R2); Lower (R3)
Violation Severity Level: Not provided
Region: SPP
Issue: USACE-Kansas City District (USACE-KC) did not have documented procedures to analyze transmission and generation Protection System Misoperations and the development of Corrective Action Plans. Therefore, USACE-KC also did not report to SPP, as required, the transmission Protection System Misoperations and the Corrective Action Plans.
Finding: SPP found that the violations did not involve a serious or substantial risk to bulk power system reliability since USACE-KC was actually analyzing its transmission and generation Protection System Misoperations that were occurring on its system (even though it did not report the Misoperations to SPP). These were also the first violations of this Reliability Standard by USACE-KC and a mitigation plan was completed.
Penalty: $0
FERC Order: Issued November 13, 2009 (no further review)
USACE – Little Rock District, FERC Docket No. NP11-19-000 (November 5, 2010)
Reliability Standard: PRC-004-1
Requirement: R2
Violation Risk Factor: High
Violation Severity Level: Not provided
Region: SPP
Issue: In March 2008, USACE – Little Rock (USACE-LR) self-certified that it did not possess an established procedure to analyze generator protection system misoperations, as well as a formal procedure to develop and implement corrective actions plans intended to prevent future misoperations.
Finding: SPP found that this violation did not constitute a serious or substantial risk to the bulk power system since USACE-LR was actually analyzing protective system misoperations and implementing corrective action plans (even though it did not have a formal procedure in place). The duration of the violation was from July 10, 2007 through October 7, 2009. In deciding not to impose a penalty for multiple violations, SPP considered the fact that the violations represented USACE-LR’s first violations of the relevant Reliability Standards; the violations were caused by USACE-LR not having formal procedures and policies in place; and USACE-LR did not attempt to conceal the violations. In addition, the violations were self-certified.
Penalty: $0
FERC Order: Issued December 3, 2010 (no further review)
USACE – Tulsa District, FERC Docket No. NP10-160-000 (September 13, 2010)
Reliability Standard: PRC-004-1
Requirement: R2
Violation Risk Factor: High
Violation Severity Level: Not provided
Region: SPP
Issue: PRC-004-1, R2 requires entities to analyze generator Protection System Misoperations, and develop and implement Corrective Action Plans to avoid future similar Misoperations according to procedures developed for PRC-003 R1. USACE-Tulsa self-certified that it was not compliant with this requirement as it did not have documented procedures for analyzing generation Protection System Misoperations and developing Corrective Action Plans.
Finding: As determined by SPP, the violation did not create a serious or substantial risk to the bulk power system, because USACE-Tulsa was performing analysis of generator Protection System Misoperations occurring on its system. SPP also considered that it was the first violation of this Reliability Standard in determining no penalty was appropriate.
Penalty: $0
FERC Order: Issued December 16, 2010, 133 FERC ¶ 61,214 (2010), reh'g denied 137, FERC ¶ 61,044 (2010)
Vandolah Power Company, LLC, FERC Docket No. NP11-129-000 (February 28, 2011)
Reliability Standard: PRC-004-1
Requirement: R2
Violation Risk Factor: High
Violation Severity Level: Lower
Region: FRCC
Issue: Vandolah Power Company, LLC (VPC) could not demonstrate that it had developed and implemented a Corrective Action Plan to preclude Protection System Misoperations as a result of events that occurred on June 27, 2008 and July 1, 2008. Duration of violation was from June 18, 2007, when the standard became enforceable, through June 2, 2009, when the violation was mitigated.
Finding: FRCC Enforcement determined that the violation posed a minimal risk to the bulk power system because VPC corrected the cause of the two events upon an immediate investigation into them. Further, the NERC BOTCC concluded the penalty appropriate because this was VPC’s first violation of the Standard, VPC developed a stronger compliance program as part of its mitigation of the violation, and VPC was cooperative during the investigation.
Penalty: $23,000 (aggregate for multiple violations)
FERC Order: Issued March 25, 2011 (no further review)
