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FERC denies APPA-NRECA request to clarify order on cybersecurity standards


From the March 26, 2014 issue of Public Power Daily

Originally published March 26, 2014

By Robert Varela
Editorial Director
The Federal Energy Regulatory Commission rejected a request by APPA and the National Rural Electric Cooperative Association to clarify its Nov. 22 order (Order No. 791) on implementation of the North American Electric Reliability Corp.’s version 5 cybersecurity standards for critical infrastructure (CIP version 5). In a March 20 order, the commission also rejected a request by the associations for a further explanation of its Regulatory Flexibility Act analysis finding that implementation of the version 5 standards will not have a significant economic impact on a substantial number of small entities.

APPA and NRECA asked the commission to clarify what the industry must do now as it prepares to comply with CIP version 5. FERC in Order No. 791 substantially approved the version 5 standards but directed NERC to eliminate the standard’s "identify, assess, and correct" language. CIP version 5 likely will become mandatory and enforceable before those changes are made, APPA and NRECA said. 

The commission in its March 20 order said Order No. 791 "found that the substantive, technical requirements of the CIP version 5 standards are just and reasonable." FERC said utilities should "move forward with implementation of the substantive, technical controls approved in Order No. 791 while NERC addresses the Commission’s directive regarding the ‘identify, assess, and correct’ compliance language."

The commission said its certification of the potential economic impact of the CIP version 5 standards on small entities satisfies the requirements of the Regulatory Flexibility Act (RFA). While noting that APPA and NRECA questioned how the commission came up with some of its assumptions for the RFA analysis, the commission asserted that the two associations "do not challenge either of the Commission’s assumptions or submit evidence that contradicts those assumptions." Absent any facts that undermine its assumptions, "we see no basis to modify the Order No. 791 RFA certification," FERC said in its March 20 order.
 

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