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Under a load of legal jargon is one central issue: the grid is growing (buckling, some may say), and we need solutions. The energy grid is already bearing as much as it can handle, we’ve already put it through more than its intended use. Its legacy architecture doesn’t age well and may not be able to keep up in the coming decades. Good to think ahead. While measures are being taken to revamp the whole system to a rebooted smart grid, changes are slow in coming, and the energy issue needs to be handled now.

FERC (the Federal Energy Regulatory Commission) (FERC) oversees electricity in the US. Its mission is to “Assist consumers in obtaining reliable, safe, secure, and economically efficient energy services at a reasonable cost through appropriate regulatory and market means, and collaborative efforts.” In other words, to get good energy out to the public reliably, affordably and by whatever legal means available. They’ve decided the grid as it stands needs an upgrade.

To do that, they’ve issued a NOPR, or Notice of Proposed Rulemaking, to get the ball rolling on legislation that will make energy transmission facilities (the plants that actually move big power from the source to the consumer) more reliable, efficient, and just better able to handle the dynamic load of electrical burdens we place – and will continue to place – upon it. It’s 2022 and things are not slowing down. Right, Alexa?

Let’s see what NERC sees in the problem, what the NOPR entails, and the benefits and barriers to implementing the improvements they suggest. Either the grid gets gradual facelifts, or it eventually buckles under the load (care for more blackouts)? Let’s take a look together at what these proposed rules do in terms of bolstering our current electrical infrastructure.

What’s the problem with the grid, and why do we need to improve it?

Think about it – the US energy grid is an electric marvel, spanning over 600,000 miles of transmission wires and boasting over 1 million watts in generating capacity. That’s big. But not big enough. With the shift towards renewable sources of energy (think wind turbines) and consumer energy sources that divert energy back (think solar panels, electric vehicles, and storage batteries), the grid needs to be able to take energy back and all around be more responsive to consumer needs. And wouldn’t it be nice to have an app where we can check real-time energy usage and maybe save a few bucks? Yep, not everyone has that, but that’s a problem for another day.

The issue we’re dealing with now (on the way to making things infinitely more convenient) is to just make sure things work. Like I stated, the grid is already being stretched past capacity as we burden a system that was made for a few household lightbulbs and maybe a radio or two to power a modern 21st century home with all that it entails. Think about an average Thursday night – your kids are home, there are TVs going in every room, you’re running a load of wash, nobody remembered to turn the lights off in the bathroom (of course), someone’s gaming, someone’s streaming, someone’s microwaving something, your five-year-old is talking to Alexa and you’re charging your Tesla. Hopefully. Other than your virtual doorbell and that gig-speed internet, you’re a pretty electricity-conscious family. After all, you’ve got an EV and some solar panels up on the roof – but even those contribute back to the grid, don’t they?

We’ll skip the office scenario (you can imagine that), and we’ve said nothing of the complete reliance of everything corporate – from a Wendy’s to a brokerage firm – on POS systems, software, and virtual machines. It’s the Fourth Industrial Revolution, and electricity is the new coal.

Now consider temperamental weather changes, the effects of climate change, and all-too-common natural disasters like fires, floods, winter storms, and their resulting power outages and what that does to renewable energy sources, and we see what FERC sees – we need a reliable grid.

What is NOPR?

This is how they’re proposing to do it. The Federal Energy Regulatory Commission has released a Notice of Proposed Rulemaking to set out the rules by which the new energy maximization game will be played. And it’s time for some new rules. Specifically, these are proposed changes to regional transmission planning (or how to plan the local energy hubs that distribute power to consumers). The NOPR includes six basic proposals, which would require transmission hubs to:

  • Conduct long-term planning, taking into account all the new energy needs of the moment, or “changes in the resource mix and demand”
  • Consider dynamic line ratings and advanced power flows to suit the needs they may have to meet in the future. In other words, plan out potential scenarios accounting for tech trends, fuel costs, retiring resources (coal, fossil fuels, fracking), weather events, and generators both taking and giving back energy.
  • Settle cost allocation among State entities or share the burden of cost in a way the participating state entities will agree to. It includes required options to consider in their Open Access Transmission Tariffs (OATTs) and requires state agreement on the option chosen.
  • No double-dipping: Transmission facilities selected for regional plans should have money coming from agreed-upon entities for that (see above), so the Construction Work in Progress (CWIP) incentive no longer applies to them.
  • Right of First Refusal (ROFR): Jointly owned transmission facilities have the right of first refusal in regional plans, for the purpose of cost allocation.
  • Transparency and Communication between regional and local entities, so we don’t build a new transmission plant that’s the wrong size. Establish rules (as transparent and non-preferential as possible) to favor consumer energy benefits and not over-build transmission centers at the same time. We’re already stretched to capacity, but if our projections for future energy use are overinflated, we could end up with millions of dollars in new infrastructure wasted. It’s a delicate balancing act.

Generally, it’s seeking ways to have “forward-looking” planning and practices in place, so the oncoming electrical wave doesn’t find energy transmission hubs unprepared. However, prepare as we might for every future energy eventuality, it amounts to nothing more than building up a house of cards if the whole of the energy sector is not secured – which is why updated cybersecurity underpins it all.

And this is where a line of pg. 124 of the 500-page document really comes into play. Under the part about long-term planning is a bit that requires one of the four long-term scenarios to account for “uncertain operational outcomes” – I.e., extreme weather or a cyberattack, as specified in the document.

That’s good news, but it isn’t enough. If this whole nationwide energy infrastructure (old or not) is so vital to our society moving forward into the digital age if its reliability, consistency, and smoothness are so paramount as to warrant legal action from Federal Energy Regulatory Commission, isn’t it important enough to secure with more than one line?

Well, yes. And that’s why FERC released another NOPR back in January addressing that very issue. Sorry we didn’t tell you first, but it would mean nothing if you didn’t understand the problem. The energy sector is vital. Its infrastructure is vital. It underpins and supports nearly everything we do and maintains our way and quality of living. And it’s getting older, more vulnerable, and more important to improve, enhance and protect.

Learn how Itegriti can help you keep on top of compliance requirements here.

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