FERC Proposes to Revise Definition of “Bulk Electric System” for Determining Who Must Comply with Federal Reliability Standards

The Federal Energy Regulatory Commission (FERC) has issued a Notice of Proposed Rulemaking (NOPR) to revise the definition of “Bulk Electric System” (BES). This definition is important because it determines which transmission system elements are subject to mandatory electric reliability standards designed to ensure the uninterrupted operation of the electric grid. Owning or operating a facility that is within the BES definition imposes compliance obligations subject to audit, and failure to remain in compliance can result in substantial economic penalties. In addition to proposing a revised definition of BES, the NOPR proposes an “exception” process whereby entities could ask that specific facilities be included or excluded. All entities owning or operating electric facilities that may impact the integrated transmission network should review this NOPR to see how it might affect their reliability obligations. For more information on this subject, please see DWT's recently issued advisory by Brian Gish of our Washington, D.C. office.