03-04-11 BPU RPT 08 - Laserfiche WebLink

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W A 1 E R E N E R G Y L € RIVERSIDE PUBLIC UTILITIES Board Memorandum PUBLIC UTILITIES BOARD OF PUBLIC UTILITIES DATE: March 4, 2011 ITEM NO: 8 SUBJECT: PUBLIC UTILITIES NORTH AMERICAN ELECTRIC RELIABILITY CORPORATION- WESTERN ELECTRICITY COORDINATING COUNCIL INTERNAL COMPLIANCE PROGRAM (ICP) ISSUE: That the Board of Public Utilities approve the Amendment to the Internal Compliance Program ("ICP") governing Riverside Public Utilities ('RPU") compliance with North American Electric Reliability Corporation ("NERC") Reliability Standards ("RS") applicable to all users, owners and operators of the bulk power system. RECOMMENDATIONS: That the Board of Public Utilities recommend that the City Council: 1. Adopt a resolution approving the attached Amendment to the Internal Compliance Program; and 2. Approve that substantive modifications to the ICP which are necessary to comply with additional or revised FERC, NERC, and/or WECC regulations may be approved by the Public Utilities General Manager and the Public Utilities Assistant General Manager- Finance/Administration in consultation with the Regulatory Compliance Manager and the City Attorney's Office. COMMITTEE RECOMMENDATION: The Finance/Marketing Committee at its regular meeting on January 28, 2011 recommended that the Board of Public Utilities recommend that the City Council approve the Amendment to the ICP, BACKGROUND: In 2007, to help insure reliable operation of the bulk electric system, electric utility industry's compliance (including RPU's) with the NERCIWestern Electricity Coordinating Council ("WECC") RS, as approved by the Federal Energy Regulatory Commission ("FERC"), became mandatory. RPU is registered with the WECC and NERC, and is responsible for the associated RS, as a Distribution Provider, Load-Serving Entity, Resource Planner and Purchasing/Selling Entity. RPU was recently unregistered by NERCIWECC as a Generator Owner and Generator Operator due to physical configuration of RPU's generating units and their inability to impact the reliable operation of the bulk electric transmission system. While an ICP is not a mandatory requirement, FERC views ICPs as an important proactive tool and will take into consideration the presence of an effective program in determining the magnitude of penalties in the event of a R5 violation. RPU's ICP has been effective, and RPU has not been sanctioned, assessed any penalties, or notified of any violations of RS.