NERC Releases 2021 Compliance Monitoring and Enforcement Findings

Through its annual Compliance Monitoring and Enforcement Program (CMEP) NERC sets high-level priorities for how utilities are monitored based on their unique characteristics and reliability risks. The 2021 CMEP implementation plan (IP) reframes the previous year’s risks and their associated areas of focus. It is important for utilities to review their compliance programs and internal controls to identify opportunities and set priorities for any enhancements or changes that may be needed.

Risk Identification

NERC uses the Enterprise Risk-based Compliance Monitoring Framework to identify both risks to the reliability of the Bulk Power System (BPS) and to identify any mitigating factors that may reduce or eliminate the impact of a given reliability risk. In conjunction with the Regions, NERC identifies which risk elements are the most impactful based on data including compliance findings; event analysis experience; performance data analysis; NERC technical committee expertise; and work products. Once identified, these risk elements help prioritize the most critical risks to the reliability of the power system.

New Risk Elements for 2021

Reliability risks are defined to focus compliance monitoring and enforcement activities in the context of the NERC mandatory standards. NERC reviewed and reassessed its 2020 risk elements and adjusted their applicability for 2021 as noted in the table below. The CEMP IP addresses standards and requirements to be considered for monitoring in light of these risks.

Key Areas of Focus

Compliance monitoring in 2021 will focus on Transmission and Generator Owners in the areas of Critical Infrastructure Protection, Protection System Misoperations, Transmission Planning and Facilities Ratings. Specifically, compliance programs will need to:

• Confirm that the compliance requirements are met for:
  • Back up Control Centers
  • Main Control Centers
  • Data Centers
  • Generation Facilities
  • Transmission Lines
  • Substations
• Ensure that utilities effectively maintain complex programs which handle large amounts of data, e.g., inventories of equipment, managing asset transfers, additions of new equipment, etc.
• Ensure that proper analysis and maintenance of protection system operations is conducted.
• Ensure that proper analysis and corrective actions resulting from misoperations analysis are implemented.
• Ensure that unavailability of major transmission equipment has been considered in the development of a spare equipment strategy.

Next Steps

Given the changes in NERC’s focus, an independent review of  your compliance programs will help you stay ahead of evolving regulatory obligations. As your trusted advisor, TRC’s independent review team will assess your company’s internal controls and asset compliance management processes, and support any needed program implementation changes.

Resources:

• NERC 2021 Compliance Monitoring and Enforcement Program Implementation Plan
• TRC NERC Compliance Services

About TRC

TRC’s approach to power system planning, design and operations balances solutions that incorporate appropriate standards, regulatory requirements, compliance obligations, best practices, operational goals and budgets. As a trusted partner to both public and private sector clients, we understand power system operations and planning and apply advanced technological solutions to meet the challenges of a constantly evolving business and regulatory landscape.  TRC advises numerous clients regarding the technical aspects of their mandatory compliance obligations.