RELIABILITY REPORTING: Understanding NERC Requirements for Hydro Reliability Reporting

Understanding why NERC – the North American Electric Reliability Corporation – requires specific reliability data on hydroelectric generating units can help project owners better manage the gathering of this data.

By Ronald M. Fluegge

Most hydroelectric project owners/operators in the U.S. or Canada have heard of the North American Electric Reliability Corporation (NERC) and its Generating Availability Data System (GADS). However, their familiarity with NERC and its requirements as they relate to hydroelectric generators may depend on many factors, including operating area and unit size. Hydro project operators within the jurisdiction of certain independent system operators (ISO) must collect and report GADS data, unless their units have an installed capacity of less than 5 MW. Outside of these ISOs, GADS data reporting is voluntary.

Regardless of whether hydro project owners/operators are currently required to report, moving forward, these owners will be wise to become familiar with what data NERC requires and how this information must be provided. Understanding these issues can help project owners better manage the gathering of data, especially if NERC makes a decision in the future to make GADS reporting mandatory for every generating unit.

What is NERC?

NERC was established in 1968 by the electric utility industry. According to the NERC website, its mission is “to ensure the reliability of the bulk power system in North America.” To achieve this mission, NERC develops and enforces reliability standards; assesses adequacy of the bulk power system every year, using forecasting; monitors the bulk power system; and educates, trains, and certifies industry personnel to operate generating facilities and the electric grid. NERC is a self-regulatory organization, subject to oversight by the Federal Energy Regulatory Commission (FERC) in the U.S. and all provincial authorities and the National Energy Board in Canada.

Current mandatory NERC reporting requirements

FERC has certified NERC as the electric reliability organization (ERO) for the entire U.S. As a result, NERC’s more than 100 reliability standards are mandatory and enforceable in the U.S. and are recognized throughout much of Canada.

Speaking of Canada, on May 8, 2009, NERC and the Northeast Power Coordinating Council Inc. (NPCC) signed an agreement with the Regie de l’Energie in the province of Quebec. Under this agreement, NERC and NPCC will assist the Regie in establishing mandatory reliability standards in Quebec. The agreement also introduces a compliance monitoring and enforcement program in the province.

The agreement marks the latest milestone in NERC’s efforts to ensure that common reliability standards are adopted and enforced across the interconnected bulk power system in North America. Recent agreements of this type also have been reached in New Brunswick and Saskatchewan.

According to the Quebec agreement, the provinces of Alberta, British Columbia, Manitoba, New Brunswick, Nova Scotia, Ontario, and Saskatchewan all have made, or will make, NERC’s reliability standards mandatory. NERC has formal agreements in place with Canada’s National Energy Board and all provinces with Canada-U.S. interties except Alberta and British Columbia.

Hydro project operators who are subject to NERC standards but fail to comply face severe penalties. The Energy Policy Act includes language that allows FERC to fine operators up to $1 million per day per violation. FERC says it will exercise this authority aggressively. Because NERC will not interpret its standards for individual project operators, it is incumbent on operators to look at all standards and determine which are applicable to them. In addition, project operators must self-certify at least once a year that they comply with all applicable standards. Finally, project operators are required to report any instances of non-compliance and submit a mitigation plan.

GADS reporting

GADS is a series of databases NERC uses to collect, record, and retrieve operating information needed to improve the performance of electric generating equipment. NERC began collecting records of “events” in its GADS databases in 1982. For GADS, an event typically is a forced outage, maintenance outage, planned outage and the equivalent derating, and reserve shutdown.

NERC requires that generating companies submit GADS data within 30 days after the end of each calendar quarter. NERC compiles this GADS data annually and reports it in the Generating Availability Report and an accompanying Generating Unit Statistical Brochure. The report presents data for five individual years and for a five-year average, with generating unit availability statistics provided on both a capacity-weighted and non-capacity-weighted basis. These reports may be downloaded for free from the Internet at GADS also produces a Historical Availability Statistics report. This report provides annual performance information, starting from 1982 through the most current year, for the same groups of units in the Generating Availability Report.

The information contained in these databases is used by regulators, original equipment manufacturers, and analysts industry-wide in numerous applications. These include availability improvement programs, high-impact/low-probability component failure analyses, overhaul schedule optimization, calculating performance measures for capacity markets, and regional adequacy reviews.

As of March 2009, NERC GADS was a voluntary program. However, four ISOs (New York ISO, ISO New England, Midwest Reliability Organization, and PJM) include GADS data as part of the contractual requirements of the UCAP/EFORd markets. UCAP (unforced capacity) is defined as the calculated unforced capacity of the unit; EFORd (Equivalent Forced Outage Rate during Demand) is used to calculate the UCAP for the unit.

In the U.S., NERC uses GADS to maintain complete operating histories on nearly 5,000 generating units with a net maximum capacity of 726,141 MW. These units represent 72 percent of the installed generating capacity in the U.S. In 2006, the most recent year for which data summaries are available, GADS information was reported to NERC on 4,884 units, of which 1,323 were hydro/pumped-storage units.

In Canada, generating companies report reliability data to the Canadian Electricity Association’s (CEA) Equipment Reliability Information System (ERIS), which is similar to NERC GADS. CEA and NERC Services are working on a program to convert CEA-formatted data into GADS-formatted event and performance data, thereby allowing Canadian generating companies to also provide GADS data. This program is complete and is being tested.

Recent changes in the use of the GADS data in both contracts and generating unit reliability monitoring have provided opportunities and latent problems. Generating companies need to be involved in all levels of the use of this data, as each level (i.e., FERC, NERC, and ISOs) has different legitimate objectives:

    – FERC is interested in NERC collecting data on all generating units, regardless of size, to capture as much reliability data as possible to ensure electric grid stability;
    – NERC is interested in collecting data on units above a reasonable size but is also very interested in collecting, analyzing, and reporting data and statistics in a consistent, standardized manner for all generating units in North America; and
    – The ISOs have incorporated subsets and/or extensions of the GADS data into their contracts, policies, and procedures and have modified the methodologies for producing statistics to meet their needs. From their perspective, these are not only needed but also required to comply with their business requirements, consistency with other entities notwithstanding.

The generating companies sometimes are caught in the middle of competing and conflicting requirements. The result can be the perceived need for two or more sets of data:

    – One for the entities that require a specific set of data; and
    – One based on company-defined standard definitions

With companies reporting to multiple jurisdictions/entities, having a single set of reliability data can seem impossible. Even if the data were defined consistently, what statistics are reported to management, to financial institutions, to regulatory bodies? Is this with or without outside management control events? How does a generating company know how a comparative factor or rate being reported, such as EFOR, is defined, if the value is not clearly identified? Is it really EFOR, a capacity-weighted EFOR, or XEFOR (EFOR without outside management control events included in the calculations)?1 Unfortunately, there is no simple answer.

You have heard the saying: The only constant in the universe is change. My best recommendation is for generating companies to manage that change in a proactive way by being involved in the process that drives the change. Generating companies can only ensure that they understand the differences by actively being involved with the organizations that require this reliability data. They should also encourage the power industry associations to which they belong, such as the National Hydropower Association, to be actively involved at the national, federal, regional, and local levels.

The future: making GADS reporting universally mandatory

GADS data reporting may become mandatory in the future. There are a range of reporting possibilities, based on installed capacities, that depend upon whose rules apply – FERC, NERC, or the ISOs.

It is possible that FERC may require all generating units, regardless of size, to report GADS data to NERC. At this time, GADS data on smaller units (i.e., installed capacity less than 5 MW) does not have to be reported to NERC. Further, generating units in Canada may be required to report to NERC if GADS becomes mandatory.

Discussions are under way between NERC and FERC as to whether there should be a minimum capacity below which GADS data reporting would not be mandatory. Some suggest that units with an installed capacity greater than 25 MW would have to report GADS data to NERC. This threshold is anticipated to capture data on about 95 percent of units. Others suggest that units with an installed capacity of 1 MW or 5 MW should be the reporting threshold.

Obviously, hydro units with installed capacities less than 25 MW that lack automatic event logging would be most affected. Owners of facilities without such automation, or that are not normally staffed, would have to record individual events manually. This is especially poignant for reserve shutdown events. (Reserve shutdown exists whenever a unit is available for load but is not synchronized due to lack of demand.) For a large number of hydro units, this event may occur frequently during a day, week, or month. FERC, NERC, or the ISOs may issue exemptions to the requirements depending on whether automatic equipment is in place to permit the full reporting of all GADS event types, including reserve shutdown events.

How this will affect hydro is still uncertain. The best way to determine this is to stay on top of the situation. There are a variety of ways to do this, including attending workshops organized by NERC and getting involved in user group meetings.



Waterpower Reliability Symposium

On Thursday, July 30, in Spokane, Wash., the Waterpower conference is hosting a symposium on Electric System Reliability – Reporting Realities. This symposium features sessions on the status of reliability reporting requirements, implementation realities, and tools and technology for making reporting more manageable.

Ron Fluegge authored and is project manager of the GADS NxL software and Profile NxL performance monitoring tools for Solomon Associates. These tools are used to report generating availability data system (GADS) data to the North American Electric Reliability Corporation (NERC) and independent system operators and to analyze reliability and availability for all types of generating units, including hydro.

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