FERC Sets Sights on Solar Flare Defense

Although it may sound more like a threat in a summer science fiction blockbuster, this month the Federal Energy Regulatory Commission ("Commission") issued a final rule requiring the development of new standards to protect the power grid from the impacts of geomagnetic disturbances ("GMDs") caused by solar activity such as solar flares ("GMD Order").

Events like solar flares can expel huge masses of charged particles into space. If these particles reach the Earth, they can distort its magnetic field and cause low frequency geomagnetically induced currents ("GICs") to flow along the oceans and surface of the Earth. As the GMD Order explains, because many transformers are grounded, these GICs may appear as electrical current to the power grid and flow "through the ground connection and conductors, such as transformers and transmission lines." If this occurs, transformers and other equipment could be damaged leading to widespread blackouts.   

The impacts of GMDs have been witnessed in the past, most notably in 1989 when the province of Quebec experienced a system-wide blackout due to a GMD. The outage lasted approximately nine hours system-wide and significantly longer in some areas, causing millions of dollars in damage.

In an effort to protect the power grid from these types of events, the GMD Order directs the North American Electric Reliability Corporation ("NERC") - the Commission-certified organization that oversees the nation's grid reliability - to develop reliability standards that address the risks posed by GMDs. The order requires NERC to submit new GMD reliability standards to the Commission for approval in a two-stage process.

In the first stage, NERC must file, within 6 months, one or more reliability standards requiring owners and operators of the Bulk-Power System ("BPS") to develop and implement operational procedures to mitigate the effects of GMDs. In the second stage, NERC must file, within 18 months, standards that identify "benchmark GMD events" and require responsible entities to assess such events for potential impacts on the BPS. In addition to this two-stage standard development process, the GMD Order requires NERC to conduct a GMD vulnerability assessment to identify facilities in the power grid that are the most at-risk from a severe disturbance.

The Commission does not require NERC to include any specific requirements in the GMD reliability standards, but the GMD Order does identify certain issues NERC should consider and address in the development process. For example, the Commission notes that operational procedures that could mitigate GMD events may include "reduction of equipment loading (e.g., by starting off-line generation), unloading the reactive load of operating generation, reductions of system voltage, and system and/or equipment isolation through reconfiguration of the transmission system."

The GMD Order also states that "[t]he benchmark GMD events should be based on factors that may include, but are not limited to, varying severity of the GMD (i.e., the rate of change in the GMDs magnetic fields), duration, geographic footprint of the GMD, how the GMD's intensity varies with latitude, system configuration, and the orientation of the magnetic fields produced by the GMD."

In addition, the Commission clarifies that the reliability standards "should not impose "˜strict liability' on responsible entities for failure to ensure the reliable operation of the Bulk-Power System in the face of a GMD event of unforeseen severity."

The final rule becomes effective on July 22, 2013 and the timelines for NERC to submit its proposed reliability standards begin to run from that date.