NERC, GISB to pitch power industry standards proposals

Two contenders for the job of setting standards for the wholesale electric market will make their case to industry Friday during a US Department of Energy-sponsored meeting in Washington, DC. The North American Electric Reliability Council and the Gas Industry Standards Board have been asked to explain their proposals to generators, marketers, industrial consumers, and investor-owned utilities.

By the OGJ Online Staff

HOUSTON, Dec. 5 -- Two contenders for the job of setting standards for the wholesale electric market will make their case to industry Friday during a US Department of Energy-sponsored meeting in Washington, DC.

The North American Electric Reliability Council (NERC) and the Gas Industry Standards Board (GISB) have been asked to explain their proposals to generators, marketers, industrial consumers, and investor-owned utilities.

While few argue against the need for standard practices, such as how to interconnect to the grid, who will set the standards continues to be controversial issue. But many observers say the need to reach a consensus is becoming more urgent, if the industry is to increase efficiency and improve reliability. In an effort to move the process along, the DOE agreed to get the various parties together to hammer out their differences.

In September, GISB endorsed a measure to form an energy industry standards board that would develop, maintain, and publish voluntary standards and model business practices for the wholesale and retail gas and power industries.

NERC has already circulated a proposal and asked for industry comment. NERC said it wanted to develop consensus, first on the need for standards, and then on the standard itself.

The electric reliability organization has attempted a number of routes to become the official standards-setting organization for the power industry, including federal legislation. But the bills never won the full support of industry, especially the independent power segment, which believed NERC was still dominated by integrated electric utilities that wouldn't represent their interests.

Many feared the organization would set standards for transmission access, for example, that effectively limited access to the grid or gave its owners higher priority.

Mark Stultz, a spokesman for the Electric Power Supply Association, said NERC appears to be "coming around" to a more market-oriented approach to creating standards. EPSA has participated in the process with both GISB and NERC, Stultz said, but hasn't picked one or the other.

"Part of the concern with NERC has been the emphasis on reliability only," Stultz said. EPSA believes GISB is farther along in recognizing the need for market independence. He explained the industry hopes "to draw the best" from the two organizations' ideas. But EPSA hasn't made a decision about how to respond to the NERC request for comment on its proposed process.

NERC said it would like to begin the process Mar. 1, 2002, and proposed dividing the industry into nine segments so that no individual or group of stakeholders could force or block approval of a standard. A standards authorization committee would administer and manage the process.

NERC has asked the American National Standards Institute (ANSI) for accreditation, and said it also is holding talks with GISB and with industry stakeholders about how its proposal can fit into a larger North American Energy Standards Board proposed by GISB.

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