NERC says reliability legislation still needed

The North American Electric Reliability Council (NERC) said it supports US Energy Secretary's Bill Richardson's efforts to explore how the reliability of the bulk power transmission system can be improved under existing law.

But NERC Pres. Michael Gent also urged the Clinton Administration to press for congressional action on Senate-passed reliability legislation in the US House during the current extended session.

Speaking in California earlier this week, Richardson said the Department of Energy (DOE) will likely ask the Federal Energy Regulatory Commission (FERC) to establish reliability standards for electricity. He said the Energy Department will seek public comment on a proposal that would require utilities to follow mandatory rules to protect the reliability of the electric grid in California and elsewhere.

He said the purpose of the rulemaking is to break the impasse in Congress and authorize establishing the standards necessary to make electricity supplies more reliable and energy markets more efficient.

"If Congress fails to act on reliability legislation, we will have no choice but to pursue other less effective, interim regulatory solutions," Gent said.

He noted about one-third of the US transmission system is not under FERC jurisdiction. As such, Gent said, the facilities and the entities that operate them would not be covered by FERC reliability standards.

In contrast, he said, the proposed reliability legislation would assure standards are fairly developed and enforced by an "independent, self-regulatory organization," with jurisdiction over all operators and users of the bulk electric systems. It would be overseen by FERC in the US.

As electricity markets become more competitive, the voluntary arrangement under which the system now operates is no longer sufficient, Gent has emphasized in the past. NERC executives testified last year before both the Senate and House the organization is seeing an increase in the number and seriousness of the violations of its voluntary reliability rules. The organization cited actions of certain control areas in the Eastern Interconnection during the summer of 1999 as demonstrating the industry is facing an urgent crisis.

A not-for-profit company, NERC was formed in 1965 to promote reliability of the bulk electric systems in North America and is comprised of 10 regional reliability councils accounting for nearly all the power supplied in the US, Canada, and portion of Baja California Norte, Mexico.