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Agenda Member Representatives Committee Pre-Meeting Informational Session Conference Call and Webinar January 11, 2018 | 12:00 p.m. – 1:00 p.m. Eastern

Dial-in: 1-888-632-5004 | Conference ID: 964540 Click here for: Webinar Registration

Introduction and Chair’s Remarks

NERC Antitrust Compliance Guidelines and Public Announcement*

Agenda Items

1. Topics and Schedule for the Board of Trustees, Board Committees, and MRC Meetings* -February 7-8, 2018

2. Overview of Items Included in the Policy Input Letter

a. Improving the Efficiency and Effectiveness of Stakeholder Engagement*

3. Informational Items

a. Update on NERC Chief Executive Officer and Chief Security Officer Searches

b. Geomagnetic Disturbance Mitigation Work Plan*

c. Schedule for Reliability Assessments Planned for 2018*

*Background materials included.

https://cc.readytalk.com/r/dhsqmnr6pzds&eom

Antitrust Compliance Guidelines

I. General It is NERC’s policy and practice to obey the antitrust laws and to avoid all conduct that unreasonably restrains competition. This policy requires the avoidance of any conduct that violates, or that might appear to violate, the antitrust laws. Among other things, the antitrust laws forbid any agreement between or among competitors regarding prices, availability of service, product design, terms of sale, division of markets, allocation of customers or any other activity that unreasonably restrains competition.

It is the responsibility of every NERC participant and employee who may in any way affect NERC’s compliance with the antitrust laws to carry out this commitment.

Antitrust laws are complex and subject to court interpretation that can vary over time and from one court to another. The purpose of these guidelines is to alert NERC participants and employees to potential antitrust problems and to set forth policies to be followed with respect to activities that may involve antitrust considerations. In some instances, the NERC policy contained in these guidelines is stricter than the applicable antitrust laws. Any NERC participant or employee who is uncertain about the legal ramifications of a particular course of conduct or who has doubts or concerns about whether NERC’s antitrust compliance policy is implicated in any situation should consult NERC’s General Counsel immediately.

II. Prohibited ActivitiesParticipants in NERC activities (including those of its committees and subgroups) should refrain from the following when acting in their capacity as participants in NERC activities (e.g., at NERC meetings, conference calls and in informal discussions):

• Discussions involving pricing information, especially margin (profit) and internal costinformation and participants’ expectations as to their future prices or internal costs.

• Discussions of a participant’s marketing strategies.

• Discussions regarding how customers and geographical areas are to be divided amongcompetitors.

• Discussions concerning the exclusion of competitors from markets.

• Discussions concerning boycotting or group refusals to deal with competitors, vendors orsuppliers.

NERC Antitrust Compliance Guidelines 2

• Any other matters that do not clearly fall within these guidelines should be reviewed withNERC’s General Counsel before being discussed.

III. Activities That Are PermittedFrom time to time decisions or actions of NERC (including those of its committees and subgroups) may have a negative impact on particular entities and thus in that sense adversely impact competition. Decisions and actions by NERC (including its committees and subgroups) should only be undertaken for the purpose of promoting and maintaining the reliability and adequacy of the bulk power system. If you do not have a legitimate purpose consistent with this objective for discussing a matter, please refrain from discussing the matter during NERC meetings and in other NERC-related communications.

You should also ensure that NERC procedures, including those set forth in NERC’s Certificate of Incorporation, Bylaws, and Rules of Procedure are followed in conducting NERC business.

In addition, all discussions in NERC meetings and other NERC-related communications should be within the scope of the mandate for or assignment to the particular NERC committee or subgroup, as well as within the scope of the published agenda for the meeting.

No decisions should be made nor any actions taken in NERC activities for the purpose of giving an industry participant or group of participants a competitive advantage over other participants. In particular, decisions with respect to setting, revising, or assessing compliance with NERC reliability standards should not be influenced by anti-competitive motivations.

Subject to the foregoing restrictions, participants in NERC activities may discuss:

• Reliability matters relating to the bulk power system, including operation and planning matterssuch as establishing or revising reliability standards, special operating procedures, operatingtransfer capabilities, and plans for new facilities.

• Matters relating to the impact of reliability standards for the bulk power system on electricitymarkets, and the impact of electricity market operations on the reliability of the bulk powersystem.

• Proposed filings or other communications with state or federal regulatory authorities or othergovernmental entities.

Matters relating to the internal governance, management and operation of NERC, such as nominations for vacant committee positions, budgeting and assessments, and employment matters; and procedural matters such as planning and scheduling meetings.

Member RepresentativesCommittee (MRC)

Pre-Meeting and Informational WebinarJanuary 11, 2018

RELIABILITY | ACCOUNTABILITY2

• Review preliminary agenda topics for: February 7 MRC meeting Board of Trustees (Board) and Board Committee meetings (February 7-8)

• Receive updates on emerging and informational issues

Objectives – Pre-Meeting and Informational Session


Schedule of Quarterly NERC Meetings and Conference Calls

*Times are tentative and subject to change


• Corporate Governance and Human Resources Committee,January 24 (Time TBD) Proposed 2018 Board Committee and vice chair appointments Possible 2018 Canadian Trustee search Board of Trustees Vice Chair Compensation - Review

Conference Calls, Prior to Fort Lauderdale


• Approve Board Committees’ self-assessment surveys• Review Board self-assessment and MRC assessment of Board

effectiveness results• 2017 Year-End Performance Report• NERC Governance Guidelines annual review• Annual Conflict of Interest and Independence Report• Annual review of committee mandate• Human Resources and staffing update

Corporate Governance and Human Resources 7:30 – 8:30 a.m., February 7


• Annual review of committee mandate• Multi-region Registered Entity Coordinated Oversight Program

update• Compliance Monitoring and Enforcement Program Annual

Report

Compliance Committee8:45 – 9:45 a.m., February 7


• 2017 year-end unaudited statement of activities• Internal audit plan update• Review investment policy• Annual review of committee mandate

Finance and Audit Committee10:00 – 10:45 a.m.


• CMEP Technology Project update• ERO Enterprise applications update• Information Technology cost optimization update• E-ISAC quarterly update

Technology and Security Committee11:00 a.m. – 12:00 p.m., February 7


• Election of NERC Trustees• Update on NERC Chief Executive Officer (CEO) and Chief Security

Officer (CSO) searches• Board reporting structure for Standards Committee• Overview of Policy Input Letter items Improving the efficiency and effectiveness of stakeholder engagement

• Additional policy discussion of key items from Board Committee meetings

• Reliability Issues Steering Committee (RISC) activities ERO Reliability Risk Priorities Report Resilience framework

Member Representatives Committee1:00 – 5:00 p.m., February 7


• Plan for addressing Reliability Standard recommendations from recent Reliability Assessments Special Reliability Assessment: Potential Bulk Power System Impacts Due

to Severe Disruptions on the Natural Gas System 2017 Long-Term Reliability Assessment

• Technical committee highlights: Critical Infrastructure Protection Committee

• Update on FERC reliability matters• Accountability matrix• Regulatory update

Member Representatives Committee1:00 – 5:00 p.m., February 7


• Committee membership and charter changes• Board Committee reports Accept 2017 year-end unaudited statement of activities

• Standards quarterly report and actions Adopt PRC-025-2, CIP-012-1, FAC-501-WECC-2, BAL-004-WECC-3, PRC-004-

WECC-2, and VAR-002-WECC-2 Approve SERC Regional Reliability Standards Development Procedure

• Approve Memorandum of Understanding between British Columbia Utilities Commission and NERC

Board of Trustees8:30 a.m.– 12:00 p.m., February 8


• SPP realignment (tentative and subject to change)• Approve Rules of Procedure amendments – consolidated

hearing process• Accept RISC’s ERO Reliability Risk Priorities Report• Committee, forum, and group reports Approve CIPC 2018 Work Plan Approve CCC 2018 Work Plan

Board of Trustees8:30 a.m.– 12:00 p.m., February 8


• Overview of Policy Input Letter items Improving the efficiency and effectiveness of stakeholder engagement

• Update on NERC CEO and CSO searches• Geomagnetic Disturbance Mitigation work plan• Schedule for reliability assessments planned for 2018

January 11 – MRC Informational Session


• January 4: Policy Input Letter issued• January 24: Policy Input Letter responses due• January 25: February Board and MRC agenda packages posted• January 25: Policy Input responses posted• February 1: February Board and MRC presentations posted

Upcoming Dates

Agenda Item 2a MRC Informational Session January 11, 2018

Improving the Efficiency and Effectiveness of Stakeholder Engagement

Action Information

Summary The ERO Enterprise Long Term Strategy, approved by the Board on November 9, 2017, recognizes the importance of effective engagement of industry technical expertise and executive leadership to the success of the ERO Enterprise’s mission and strategic priorities. Stakeholders and the ERO Enterprise devote substantial resources and funding to supporting the MRC, Standards Committee, Planning Committee, Operating Committee, Critical Infrastructure Protection Committee, Compliance and Certification Committee, Personnel Certification Governance Committee, Reliability Issues Steering Committee, and the many working groups and tasks forces which have been created by these committees. These resource demands are occurring as both industry and the ERO Enterprise are under increased budget pressure and stipulation to prioritize activities, improve efficiency, and reduce costs. The ERO Enterprise is committed to working with the MRC and the leadership of the standing committees in both evaluating and taking appropriate steps to further improve the efficiency and effectiveness of industry and ERO Enterprise engagement. New models and mechanisms of engagement should be explored in determining how best to bring executive leadership into the strategic direction of the ERO Enterprise, while engaging more agile technical groups with the best relevant expertise available from industry and elsewhere.

In a letter to the MRC Chair dated January 4, 2018, the NERC Board chair Roy Thilly requested MRC input on recommend next steps in addressing these issues in recognition that improvements in the efficiency and effectiveness of stakeholder engagement must be stakeholder driven.

Attachment

1. NERC’s Stakeholder Engagement Committees, Subcommittees, Working Groups, andTask Forces; January 2018

http://www.nerc.com/AboutNERC/StrategicDocuments/ERO_Enterprise_Long-Term_Strategy_Approved_by_the_NERC_Board_on_Novmeber_9_2017.pdf

NERC Stakeholder Engagement Committees, Subcommittees, Working Groups, and Task Forces* January 2018

* Does not include Regional Entity stakeholder committees.

Member Representatives Committee MRC Business Plan and Budget Input Group Board of Trustees Nominating Committee

Compliance & Certification Committee ERO Monitoring Subcommittee Organization Registration and Certification Subcommittee Compliance Processes and Procedures Subcommittee

Critical Infrastructure Protection Committee Critical Infrastructure Protection Committee Executive Committee Cyber Security Subcommittee

Control Systems Security Working Group Security Training Working Group

Operating Security Subcommittee Grid Exercise Working Group Supply Chain Working Group

Physical Security Subcommittee Physical Security Guidelines Task Force Physical Security Working Group

Policy Subcommittee Security Metrics Working Group Compliance and Enforcement Input Working Group

Reliability Issues Steering Committee

Standards Committee Functional Model Advisory Group (FMAG) Standards Committee Process Subcommittee Project Management and Oversight Subcommittee

Personnel Certification Governance Committee Exam Working Group (EWG)

Operating Committee Event Analysis Subcommittee

EMS Working Group Operating Reliability Subcommittee Personnel Subcommittee Resources Subcommittee

Planning Committee Reliability Assessment Subcommittee

Probabilistic Assessment Working Group System Analysis and Modeling Subcommittee

Load Modeling Task Force Plant-Level Controls and Protection Modeling Task Force Power Plant Modeling and Verification Task Force

System Protection and Control Subcommittee Synchronized Measurement Subcommittee

Joint Operating Committee and Planning Committee Essential Reliability Services Working Group Geomagnetic Disturbance Task Force Inverter-Based Resource Performance Task Force Methods for Establishing IROLs Joint Task Force Performance Analysis Subcommittee

Demand Response Availability Data System Working Group Generating Availability Data System Working Group Transmission Availability Data System Working Group

Other Electricity Sub-sector Coordinating Council (ESCC) Standing Committee Coordination Group

Agenda Item 3b MRC Informational Session January 11, 2018

Geomagnetic Disturbance Mitigation Work Plan Update

Action Information

Background On September 22, 2016, FERC issued Order No. 830 approving Reliability Standard TPL-007-1 − Transmission System Planned Performance for Geomagnetic Disturbance (GMD) Events. In the order, FERC directed NERC to take the following additional actions:

• Revise the TPL-007 Reliability Standard through the standards development process;

• Submit a GMD research work plan to FERC; and

• Collect GMD-related data pursuant to NERC Rules of Procedure Section 1600.

NERC filed the preliminary research work plan with FERC on May 30, 2017. On October 19, 2017, FERC issued an order accepting NERC’s plan. The NERC Board of Trustees adopted proposed TPL-007-2 in November 2017 and NERC is preparing to file the proposed standard.

Status NERC and the Electric Power Research Institute (EPRI) initiated the GMD research work plan in November 2017. Over 20 utilities and Independent System Operators (ISO) are participating in the EPRI GMD project that runs through early 2020 and addresses all research plan tasks identified in Order No. 830. With technical support from appropriate researchers, the project includes:

• Continued analysis and sensitivity testing of the benchmark GMD event and latitudescaling factors to support accurate GMD Vulnerability Assessments;

• Further development of earth models available to entities to improve their usability andapplicability for calculating geomagnetically-induced currents (GIC); and

• Development of harmonics analysis guidelines and tools for entities to use in performingsystem-wide assessments of GMD-related harmonics.

In December 2017, EPRI provided a beta version of transformer thermal impact assessment software for entities to use in modeling transformer heating and assessing vulnerability to GIC. The GMD Task Force (GMDTF) will review the software in January 2018. NERC anticipates making it available to the public by March 2018.

NERC and the GMDTF drafted a NERC Rules of Procedure (ROP) Section 1600 data request for the collection of GIC monitoring and magnetometer data as required by Order No. 830:

• The draft data request will be posted for a 45-day industry comment period in January2018.

• The final data request will be submitted to the Planning Committee and NERC Board ofTrustees for approval in 2018.

Agenda Item 3c MRC Informational Session January 11, 2018

Schedule for Reliability Assessments Planned for 2018

Action Information

Background NERC’s Rules of Procedure stipulate that NERC will annually conduct and report the results of an independent assessment of the overall reliability and adequacy of the interconnected North American Bulk Power System (BPS).

It is NERC’s objective to have an expeditious and efficient planning and review process for Reliability Assessments. In the planning and review process, it is important that the process provide for administrative preparation and adequate review time by relevant participants and contributors, including NERC Management and staff, stakeholder groups, NERC Technical Committees, the Member Representatives Committee (MRC), and the NERC Board of Trustees (Board).

The ERO Reliability Assessment program has established a framework for its core reliability assessments, as provided in the table below:

2018 Special Reliability Assessments NERC maintains a list of special assessment topics for consideration and pursuit by the ERO. Input to this list comes from various sources, including but not limited to, technical committees, the MRC, the Long-Term Reliability Assessment, the State of Reliability Report, various Regional assessments and studies, and the Reliability Issues Steering Committee’s (RISC) prioritized risks

and recommendations. NERC and the Regional Entities develop a scope for each potential assessment and determine data collection needs, schedule requirements, and technical groups and stakeholders that will ultimately support the assessment. As a result of input provided by the MRC, the NERC technical committees, and ERO Enterprise management in 2017, a special reliability assessment will be conducted in 2018 evaluating conventional generation retirements and impacts to BPS reliability.

Topic: Conventional Generation Retirements and BPS Reliability Impacts Schedule: Targeting Q2 2018 for Board acceptance

Summary of Plan for 2018 Based on NERC’s Rules of Procedure, along with the ERO Enterprise Operating Plan and RISC priorities, NERC will conduct the following assessments in 2018:

Assessment Scope Planned Delivery Long-Term Reliability Assessment 10 Year Resource Assessment,

Emerging Reliability Issues December 2018

Winter Assessment Seasonal Resource Assessment November 2018 Summer Assessment Seasonal Resource Assessment May 2018 Conventional Generation Retirements and BPS Reliability Impacts

Assessment of Generation Retirements

June 2018