Stakeholder processes have their place in certain situations, but adopting such an approach to the crafting of clear, enforceable and mandatory electric reliability rules could prove to be extremely counterproductive, FERC Commissioner Nora Brownell told an audience of state utility regulatory commissioners last Monday.

Brownell made her comments during a session at the winter committee meetings of the National Association of Regulatory Utility Commissioners (NARUC) in Washington, DC, dealing with power reliability issues.

Much of the comments made by Brownell and others at the nearly two-hour session came in the context of how state and federal regulators, as well as the power industry, can avoid a repeat of last summer’s historic blackout that hit large swaths of the U.S. and Canada.

Brownell cautioned against the idea that making currently voluntary reliability rules mandatory will, in and of itself, be a significant enough step to guard against future blackouts. “We need rules that are clear and crisp and enforceable. We need rules that can be measured and audited. We need rules that are made by technical experts.”

While acknowledging that there’s “lots of room for stakeholder process in our lives,” Brownell also said that “I’m not sure that reliability rules are one. I don’t think we want or need or are serving the public by” developing reliability rules through an “arduous, long, unbelievable process and end up with the lowest common denominator. This isn’t the place for compromise. This is the place for experts to tell us what we need to do and to tell us how to implement them.”

Yes, mandatory reliability rules are needed, Brownell said, but everyone in the power sector needs to step back and think through a number of issues before “we just jump up and down and say, ‘Make them mandatory and all the problems go away,’ because you know what? When the next blackout comes…we will not be able to answer the tough questions.”

When the next significant power outage rolls around, “the public is not going to be quite as benign as they have been and I think we will all be held accountable as we should,” she added.

At a later point, Brownell said that NARUC’s critical infrastructure committee has agreed to take on the responsibility of working with FERC to identify what are the reliability issues “we need to confront” and “how we can work together going forward.

“I think there are issues that states may have jurisdiction, where the feds may not have jurisdiction. I would hope that would not even begin to be a point of discussion. I think what needs to be the point of discussion is who needs to do what when and how can we complement each other.”

Meanwhile, a top official with the Department of Energy (DOE) said that the “highest levels of corporate governance must support and sign off on reliability plans and audits.”

“It is absolutely critical that those who make capital funding decisions for their system have the accountability for the reliability of their system,” said Jimmy Glotfelty, director of the DOE’s Office of Electric Transmission and Distribution.

Glotfelty also said that the North American Electric Reliability Council (NERC) must have a funding mechanism “that is independent from the entities that they oversee.” He said that NERC must be able to “feel that they have the independence to make the call that is necessary to ensure reliability.”

Also, Glotfelty said that NERC must be able to be held accountable. “We can’t allow them to be outside the scope of accountability. We will work with them on metrics. We will work with them on other key measures by which they should be judged.”

The DOE official also called for a refinement of auditing and monitoring processes at NERC. “We completely support the readiness audits that are going on today, but we think that this is a process that must be refined. We must go back and learn — how did this process work? Where did it work? Where did it not work? And make adjustments sooner rather than later. We can’t just take a process that was put together in a fairly quick fashion and say that it is the ongoing process. We must be open to suggestions and refinements to ensure reliability going forward.”

Moreover, Glotfelty said that it is critical that federal and state jurisdictional issues related to power reliability are resolved. “I hope that we do that together. We can either do that through the Congress, the courts or together. I think together is the fastest way to get this done.”

©Copyright 2004 Intelligence Press Inc. Allrights reserved. The preceding news report may not be republishedor redistributed, in whole or in part, in any form, without priorwritten consent of Intelligence Press, Inc.