2012 11 30 Exhibit B 4 BC Hydro IRES 1 to BCUC · • Real-time Assessment – new Term •...

BChgdro m FOR GENERATIONS

Janet Fraser Chief Regulatory Officer Phone: 604-623-4046 Fax: 604-623-4407 bchydroreg u latorygrou p@ bchyd ro. com

November 30, 2012

Ms. Erica Hamilton Commission Secretary British Columbia Utilities Commission Sixth Floor - 900 Howe Street Vancouver, BC V6Z 2N3

Dear Ms. Hamilton:

RE: British Columbia Utilities Commission (BCUC) British Columbia Hydro and Power Authority (BC Hydro) Mandatory Reliability Standards (MRS) Assessment Report No. 5 Responses to BCUC Information Request No. 1

BC Hydro writes to enclose as Exhibit B-4, its responses to BCUC Round 1 Information Requests.

For further information, please contact Gordon Doyle at 604-623-3815 or by email at [email protected].

Yours sincerely,

anet Fraser Chief Regulatory Officer

ch/ma

Enclosure (1)

British Columbia Hydro and Power Authority, 333 Dunsmuir Street, Vancouver BC V6B 5R3 www.bchydro.com

... 2/

B-4

markhuds

BC HYDRO – MRS Report No 5

November 30, 2012 Ms. Erica Hamilton Commission Secretary British Columbia Utilities Commission Mandatory Reliability Standards (MRS) Assessment Report No. 5 Responses to BCUC Information Request No. 1

BChgdro

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Copy to: [email protected]; [email protected]; [email protected]; [email protected]; walter .dicesare@brookfieldpower .com; Terry. Edmonds@canforpu I p. com; Gary. Bradshaw@canforpu lp.com; garnet. boese@canforpu I p .com; Stephen. Hilder@canforpulp .com; Soti rios. Korogonas @canforpulp .com; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; akirby@capitalpower; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; . [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected];

ERICA HAMILTON COMMISSION SECRETARY

[email protected] web site: http://www.bcuc.com

SIXTH FLOOR, 900 HOWE STREET, BOX 250 VANCOUVER, BC CANADA V6Z 2N3

TELEPHONE: (604) 660-4700 BC TOLL FREE: 1-800-663-1385

FACSIMILE: (604) 660-1102

Log No. 39799

PF/BCH-MRS RptNo.5/GC/A-2_BCUC IR No1 to BCH

VIA EMAIL [email protected] November 9, 2012

BC HYDRO – MRS ASSESSMENT REPORT NO. 5 EXHIBIT A-2

Ms. Janet Fraser Chief Regulatory Officer British Columbia Hydro and Power Authority 333 Dunsmuir Street Vancouver, BC V6B 5R3 Dear Ms. Fraser:

Re: British Columbia Hydro and Power Authority Mandatory Reliability Standards Assessment Report No. 5

Commission Information Request No. 1

Further to your April 19, 2012 filing of the MRS Assessment Report No. 5, enclosed please find Commission Information Request No. 1. Pursuant to Order R-54-12 please respond by Friday, November 30, 2012. Yours truly, Erica Hamilton /yl Enclosure

BCH – MRS Assessment Report No. 5 1 Commission Information Request No. 1

BRITISH COLUMBIA UTILITIES COMMISSION INFORMATION REQUEST NO. 1

British Columbia Hydro and Power Authority

Mandatory Reliability Standards

Assessment Report No. 5

1.0 Reference: BC Hydro’s April 19, 2012 cover letter to MRS Assessment Report No. 5 Regarding additional comments with respect to NERC Glossary of Terms versions MRS Assessment Report No. 5 section 4 Appendix B (NERC Glossary dated December 13, 2011), Appendix D (Draft Order)

1.1 Please list all Glossary Terms in Appendix B that have not been approved by FERC, together with

the standards that are impacted by the use of those terms. If those terms are not approved for

use in British Columbia at this time, what are the compliance impacts and reliability impacts (if

any) for standards which the Commission has previously adopted for British Columbia and for

the standards reviewed in MRS Assessment Report No. 5?

1.2 If the December 13, 2011 Glossary is approved with the exception of specific terms that have

not been approved by FERC, what process would BC Hydro propose to follow to bring those

terms forward to the Commission for consideration as they are later approved or rejected by

FERC? Would BC Hydro propose adopting and posting a marked up version of the Glossary to

assist all parties in identifying any terms not approved for use in British Columbia in the

meantime?

1.3 Does the August 4, 2011 version or earlier versions of the Glossary that have been adopted for

use in British Columbia contain any terms that BC Hydro recommends be not effective in British

Columbia at this time?

1.4 Does BC Hydro suggest that all elements of earlier Glossary versions that have been adopted in

British Columbia cease to be in effect upon approval of the December 13, 2011 Glossary? What

are the compliance impacts or reliability impacts (if any), if the December 13, 2011 version of

the Glossary is used in conjunction with standards that have been approved previously?

2.0 Reference: BC Hydro’s April 19, 2012 cover letter regarding additional comments with respect to Compliance Provisions MRS Assessment Report No. 5 section 3.1, Appendix A-2, (clean and black lined

versions of the standards assessed in Report No. 5), Appendix D (draft Order)

BC Hydro’s April 19, 2012 letter observes that various compliance-related provisions are not considered

to be within the meaning of “reliability standards” defined in section 125.2 of the Utilities Commission

Act, and that compliance-related provisions not assessed by BC Hydro are indicated by strike-through

marking with the standards assessed in the Report.

BCH – MRS Assessment Report No. 5 2 Commission Information Request No. 1

Definitions for “Compliance Provisions” and “Reliability Standard” are provided in the Rules of

Procedure for Reliability Standards in British Columbia. Compliance Provisions adopted separately by

the Commission are posted on the WECC website to accompany each of the adopted Reliability

Standards and need not be indicated by strike-through marking.

2.1 To the extent that BC Hydro suggests that the Commission retain BC Hydro’s strike-through of

Compliance Provisions in respect of Reliability Standards assessed and adopted in British

Columbia, is BC Hydro proposing that the Commission revisit all previous Reliability Standards

and Compliance Provisions approved and posted and replace them with strike-through versions

as provided by BC Hydro?

2.2 If the alternative suggested by BC Hydro were considered, to include an explanation on the

WECC website that compliance-related provisions found in Section D - Compliance that

accompany each of the standards reviewed by BC Hydro have not been assessed by BC Hydro,

what benefit would that provide?

2.3 For purposes of separating out compliance-related provisions that BC Hydro does not assess,

how does BC Hydro distinguish between compliance-related provisions in section D versus other

compliance-related areas for a standard? For example in BAL-006 Appendix A-2, page 1,

BC Hydro strikes through effective dates, specific compliance provisions in Section D and VSL but

does not strike through regional differences or VRF references.

3.0 Reference: Exhibit E-1

In its comments to MRS Assessment Report No. 5, Shell Energy raises the issue of timeliness with

respect to the version of standards being approved, particularly when a standard may have been

recognized by NERC and FERC to be unnecessary or erroneous. A further example of this may be

TPL-002-0b, which the Commission understands may have been remanded back to NERC.

3.1 Does BC Hydro believe that it would be appropriate for BC Hydro to submit a modified

application to the Commission if a proposed standard is superseded by FERC Order between the

time BC Hydro’s MRS Assessment Report is submitted and the Commission orders the standard

to be approved or not approved for British Columbia? If not, how would BC Hydro propose to

prevent Commission approval of a standard that may be unnecessary or erroneous?

British Columbia Utilities Commission Information Request No. 1.1.1 Dated: November 9, 2012 British Columbia Hydro & Power Authority Response issued November 30, 2012

Page 1 of 2

British Columbia Hydro & Power Authority Mandatory Reliability Standards Assessment Report No. 5

Exhibit: B-4

1.0 Reference: BC Hydro’s April 19, 2012 cover letter to MRS Assessment

Report No. 5 Regarding additional comments with respect to NERC Glossary of Terms versions MRS Assessment Report No. 5 section 4 Appendix B (NERC Glossary dated December 13, 2011), Appendix D (Draft Order)

1.1.1 Please list all Glossary Terms in Appendix B that have not been approved by FERC, together with the standards that are impacted by the use of those terms. If those terms are not approved for use in British Columbia at this time, what are the compliance impacts and reliability impacts (if any) for standards which the Commission has previously adopted for British Columbia and for the standards reviewed in MRS Assessment Report No. 5?

RESPONSE:

The Glossary Terms in Appendix B that have not been approved by Federal Energy Regulatory Commission (FERC) are those Terms highlighted in blue in Appendix B. For ease of reference, the 17 non-FERC approved Glossary Terms, highlighted in Appendix B, are:

· Adverse Reliability Impact – revised Term

· ATC Path – new Term

· Blackstart Resource – new Term

· Business Practices – new Term

· Bus-tie Breaker – new Term

· Consequential Load Loss – new Term

· Long-Term Transmission Planning Horizon – new Term

· Minimum Vegetation Clearance Distance – new Term

· Non-Consequential Load Loss – new Term

· Operational Planning Analysis – new Term

· Planning Assessment – new Term


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Exhibit: B-4

· Postback – new Term

· Protection System – revised Term

· Real-time Assessment – new Term

· Right-of-Way – revised Term

· Vegetation Inspection – revised Term

· Wind Generating Station – new Term.

For the new and revised Terms, which are non-FERC approved, BC Hydro has not done an assessment for compliance and reliability. Such assessments are done once these Terms are approved by FERC and in the context of any new and revised standards to be adopted in B.C. Adopting a Term from the Glossary out of step with the B.C. assessment process has the potential to create inconsistencies and unintended consequences.

As provided in BC Hydro’s application, BC Hydro recommends that the BCUC only adopt Glossary Terms once adopted by FERC and assessed by BC Hydro, in accordance with section 125.2(3) Utilities Commission Act and section 3 of the Mandatory Reliability Standards Regulation.


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Exhibit: B-4



1.1.2 If the December 13, 2011 Glossary is approved with the exception of specific terms that have not been approved by FERC, what process would BC Hydro propose to follow to bring those terms forward to the Commission for consideration as they are later approved or rejected by FERC? Would BC Hydro propose adopting and posting a marked up version of the Glossary to assist all parties in identifying any terms not approved for use in British Columbia in the meantime?

RESPONSE:

BC Hydro proposes that it will always assess the latest version of the Glossary as part of its regular, ongoing assessment process. The Glossary is an evolving document that is in lockstep with the standards development process and reviews of the Glossary should be done concurrently with the standard assessment process. The most recent version of the Glossary is assessed at the time each assessment report is prepared, therefore there should be no urgency to consider more recent versions in between assessment reports.

Accordingly, BC Hydro will assess the latest version of the Glossary dated November 15, 2012 (or later version if published before November 30, 2012) as part of MRS Assessment Report No. 6, which will cover the assessment period from December 1, 2011 to November 30, 2012. Any Glossary Terms which have been approved by FERC since the version of the Glossary dated December 13, 2011 was assessed in MRS Assessment Report No. 5 will also be assessed in the upcoming Report.

BC Hydro does not recommend adopting and posting a marked up version of the Glossary in between Assessment Reports, since changes to Glossary Terms may have compliance impacts. In addition, this would be a resource intensive process, complicated to administer and potentially confusing.


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Exhibit: B-4



1.1.3 Does the August 4, 2011 version or earlier versions of the Glossary that have been adopted for use in British Columbia contain any terms that BC Hydro recommends be not effective in British Columbia at this time?

RESPONSE:

No. However, BC Hydro reiterates that the Glossary should only be adopted following assessment by BC Hydro and notes that the adoption of the August 4, 2011 version of the Glossary led to the adoption of 15 Terms that were not FERC-approved. With the approval of the December 13, 2011 version, as proposed by BC Hydro, this oversight will be corrected.


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Exhibit: B-4



1.1.4 Does BC Hydro suggest that all elements of earlier Glossary versions that have been adopted in British Columbia cease to be in effect upon approval of the December 13, 2011 Glossary? What are the compliance impacts or reliability impacts (if any), if the December 13, 2011 version of the Glossary is used in conjunction with standards that have been approved previously?

RESPONSE:

Yes.

BC Hydro has not identified any compliance impacts or reliability impacts if the FERC approved Terms in the December 13, 2011 version of the Glossary are used in conjunction with standards that have been approved previously.


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Exhibit: B-4

2.0 Reference: BC Hydro’s April 19, 2012 cover letter regarding additional

comments with respect to Compliance Provisions MRS Assessment Report No. 5 section 3.1, Appendix A-2, (clean and black lined versions of the standards assessed in Report No. 5), Appendix D (draft Order)

BC Hydro’s April 19, 2012 letter observes that various compliance-related provisions are not considered to be within the meaning of “reliability standards” defined in section 125.2 of the Utilities Commission Act, and that compliance-related provisions not assessed by BC Hydro are indicated by strike-through marking with the standards assessed in the Report.

Definitions for “Compliance Provisions” and “Reliability Standard” are provided in the Rules of Procedure for Reliability Standards in British Columbia. Compliance Provisions adopted separately by the Commission are posted on the WECC website to accompany each of the adopted Reliability Standards and need not be indicated by strike-through marking.

1.2.1 To the extent that BC Hydro suggests that the Commission retain BC Hydro’s strike-through of Compliance Provisions in respect of Reliability Standards assessed and adopted in British Columbia, is BC Hydro proposing that the Commission revisit all previous Reliability Standards and Compliance Provisions approved and posted and replace them with strike-through versions as provided by BC Hydro?

RESPONSE:

Yes. BC Hydro proposes that Reliability Standards which are effective in B.C. and posted on the WECC website be marked up with a strike-through of “Section D – Compliance” in order to clearly indicate that the compliance provisions do not constitute part of the “Reliability Standard”, and that BC Hydro does not conduct an assessment of the compliance provisions as part of its assessment process.


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Exhibit: B-4





1.2.2 If the alternative suggested by BC Hydro were considered, to include an explanation on the WECC website that compliance-related provisions found in Section D - Compliance that accompany each of the standards reviewed by BC Hydro have not been assessed by BC Hydro, what benefit would that provide?

RESPONSE:

The benefit of including an explanation as proposed would be to provide notice to all B.C. stakeholders that the compliance provisions are not assessed by BC Hydro as part of the “Reliability Standard”. The BCUC has the authority to develop compliance provisions that may differ from the compliance or enforcement provisions accompanying reliability standards of a standard-making body prescribed in the Utilities Commission Act, as per the Rules of Procedure for Reliability Standards in B.C. Accordingly, BC Hydro wishes to avoid any confusion which may arise by including the “compliance provision” within the “reliability standard” without some form of clarification being provided to stakeholders.


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Exhibit: B-4





1.2.3 For purposes of separating out compliance-related provisions that BC Hydro does not assess, how does BC Hydro distinguish between compliance-related provisions in section D versus other compliance-related areas for a standard? For example in BAL-006 Appendix A-2, page 1, BC Hydro strikes through effective dates, specific compliance provisions in Section D and VSL but does not strike through regional differences or VRF references.

RESPONSE:

For each reliability standard, BC Hydro strikes out all of Section D, including violation severity levels, because these compliance provisions and penalty amounts go beyond reliability requirements. However, regional differences and violation risk factors are related to reliability and are, thus, retained

BC Hydro has suggested striking out the effective date to clarify that effective dates will be as ordered by the BCUC upon adoption of the standards in B.C.


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Exhibit: B-4

3.0 Reference: Exhibit E-1

In its comments to MRS Assessment Report No. 5, Shell Energy raises the issue of timeliness with respect to the version of standards being approved, particularly when a standard may have been recognized by NERC and FERC to be unnecessary or erroneous. A further example of this may be TPL-002-0b, which the Commission understands may have been remanded back to NERC.

1.3.1 Does BC Hydro believe that it would be appropriate for BC Hydro to submit a modified application to the Commission if a proposed standard is superseded by FERC Order between the time BC Hydro’s MRS Assessment Report is submitted and the Commission orders the standard to be approved or not approved for British Columbia? If not, how would BC Hydro propose to prevent Commission approval of a standard that may be unnecessary or erroneous?

RESPONSE:

BC Hydro does not believe that in all circumstances it would be appropriate for it to submit a modified assessment to the BCUC if a proposed standard is superseded by a FERC order between the time BC Hydro’s MRS Assessment Report is submitted and the BCUC orders the standard to be approved or not approved for B.C. BC Hydro submits interim MRS Assessment Reports to the BCUC only in circumstances where BC Hydro believes that such a report is warranted due to immediate reliability or compliance concerns.

With respect to the specific standards identified in the Shell Energy comments, BC Hydro notes that these comments relate to standard revisions that are not yet FERC approved and hence are not included in this assessment report.

2012 11 30 Exhibit B 4 BC Hydro IRES 1 to BCUC · • Real-time Assessment – new Term •...

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