Project QC Consultation on Proposed Reliability Standards and Supporting Documents Information Session with Entities Concerned January 11 and 16, Direction – Contrôle des mouvements d'énergie

Outline Objectives of session Québec regulatory framework Status on reliability standards Consultation process Project QC –Proposed supporting documents –Proposed reliability standards –Preliminary assessment of relevance and impacts of proposed standards –Feedback –Next steps Questions and discussion 2

Objectives of session –Status report on reliability standards in Québec –Explain the first round of consultation –Present the next steps The following will not be covered: Issues related to the file now before the Régie de l'énergie Technical aspects of the proposed reliability standards 3

Québec regulatory framework The Régie de l'énergie is responsible for: –designating the Reliability Coordinator for Québec –adopting the reliability standards filed by the Reliability Coordinator –approving the register of entities subject to the reliability standards adopted by the Régie de l'énergie 4

Québec regulatory framework (cont.) History : –In 2007, the Régie de l'énergie designated the Direction – Contrôle des mouvements d'énergie as Reliability Coordinator for Québec –In 2008 and 2009, the Reliability Coordinator informed the entities potentially subject to the standards that reliability standards would be filed with the Régie de l'énergie –In June 2009, the Reliability Coordinator filed the following with the Régie de l'énergie (docket R ) 95 NERC reliability standards for adoption A register identifying 55 entities subject to the standards for approval Supporting documents 5

Status on reliability standards Docket R : –Follow-up on decisions D and D (PDF-In French Only)D D –Adoption of 12 standards on July 25, 2012 (FAC and CIP)FAC and CIP –Schedule established by the Régie de l'énergie in its procedural letter (PDF-In French Only) of December 6, 2012procedural letter Implemented by the Régie de l'énergie: –Québec Compliance Monitoring and Enforcement Program (QCMEP) –Québec Rules of Procedure (QROP) for Compliance Services, with NPCC and NERC –Upcoming agreement between the Régie de l'énergie, NERC and NPCC To be approved by the Gouvernement du Québec on recommendation by the Ministère des Ressources naturelles et de la Faune 6

Status on reliability standards (cont.) On approval of the QCMEP and the QROPs, –the Reliability Coordinator will have 30 days to file an updated Sanction Guide that takes these documents into account (docket R , phase 2); –a hearing will be held 21 days later. Cf. Decision D (PDF - In French Only)D

Consultation process Consultation process prior to filing of reliability standards Approved by the Régie de l'énergie in Decision D (PDF - In French only) Makes for a fuller assessment of the monetary impact of standards proposed by the Reliability Coordinator (D , para. 110) Cf. Decision D

Project QC Proposed New Standards and Supporting Documents 9 Direction – Contrôle des mouvements d'énergie 9

Proposed supporting documents Register of Entities Subject to Reliability Standards: New entities added Register of Entities Subject to Reliability Standards Glossary of Terms and Acronyms: Updated to include changes made by NERC Glossary of Terms and Acronyms Recommended Implementation Dates Violation Risk Factors: Updated to include the proposed standards Violation Risk Factors 10

Proposed reliability standards Reliability standards: 16 reliability standards, 4 of them updates and 12 new, have been proposed along with Appendix QC-PRC-018. Reliability standards –Each standard is accompanied by a preliminary assessment of its relevance and its impact –The three main factors examined in the preliminary assessment of each proposed standard are applicability, implementation and compliance monitoring 11

Preliminary assessment of proposed standards List of standards and their impact in terms of implementation, maintaining the standard and compliance monitoring: 12 StandardsImplementationMaintainingMonitoring EOP-003-2Low FAC-008-3ModerateLowModerate FAC-013-2Moderate Low IRO-008-1Low IRO-009-1ModerateLow IRO-010-1aModerateLow MOD-001-1aModerateLowModerate MOD-008-1Moderate Low MOD-028-1ModerateLowModerate MOD-029-1aModerateLowModerate MOD-030-2ModerateLowModerate PER-004-2Low PER-005-1ModerateImportantModerate PRC-002-NPCC-01ImportantModerate PRC-006-1Moderate PRC (ann.QC)High Moderate PRC-023-2Low Moderate

Feedback Two forms are available: –Standards and supplementary documentsStandards and supplementary documents –Evaluation of the impacts of proposed standardsEvaluation of the impacts of proposed standards The following information must be clearly indicated: –Name of person submitting the comments –Name of entity represented –Document and section to which the comment applies –Impact the proposed standard will have on the entity (human, material and financial resources) (be as specific as possible) Send feedback to: 13

Next steps Study of feedback Publication of responses to feedback Technical meeting (to explain the responses and technical aspects of the standards) Incorporation of accepted comments into standards and supporting documents Filing with the Régie de l'énergie for adoption of standards The filing will take place after the standards now being studied by the Régie de l'énergie have been adopted 14

Questions and discussion 15

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