1. Garret Story, Enforcement Analyst
My name is Garret Story and I am an Enforcement Analyst at WECC.
Garret Story, Enforcement Analyst

2. The Hand-Off The Hand-off to Enforcement Analyst
Possible Violation Submittal
Technical SME Review
The Hand-off to Enforcement Analyst
Enforcement Analyst Review
5 Methods of PV Disposition
Confirmed Violation
I am going to talk about the process an Enforcement Analyst goes through once he has received the Possible Violation.
The Enforcement Analyst will review the facts of the Possible Violation and the findings of the Subject Matter Expert or Audit Team to determine the appropriate disposition method.

3. WECC Enforcement Analysts
Primary Role: Determining Violation Disposition (Disposition Analysis)
Violation disposition
Case analysis
Policy analysis
Assess penalties
Conduct settlements
Be a point of contact for the Entity
Determining the disposition method for Possible Violations is the primary role of Enforcement Analysts.
However, Enforcement Analysts also conduct case analysis, policy analysis, assess penalties, conduct settlements, and ensure that violations are moving through the process. Enforcement Analysts are a point of contact for the Entity.
If you ever have questions or concerns or need someone to guide you through the enforcement process, contact your Enforcement Analyst.

4. Disposition Methods Dismissal Compliance Exception (“CE”)
Find, Fix and Track (“FFT”)
Notice of Alleged Violation (“NOAV”)
Expedited Settlement Agreement (“ESA”)
There are five possible disposition Methods.
Dismissals: There was not actually a violation of the Standards
Compliance Exception and FFT: There was a violation of the standards, but the violation did not warrant a penalty
NOAV and ESA: There was a violation of the standards that warranted a penalty

5. Dismissal
Disposition method used when the Enforcement Analyst determines the possible violation is not enforceable
For Example…
Standard Requirement does not apply to Entity
Facts and circumstances warrant a violation of a different Standard Requirement
Entity produced additional evidence demonstrating compliance
The first disposition method that we will discuss is the dismissal.
Your Enforcement Analyst will issue a dismissal any time it is determined that the possible violation is not enforceable. This may be because we determined that the Standard did not apply to the entity or these facts and circumstances or we may determine that the facts and circumstances warrant a violation of a different Standard and Requirement.
Generally, this will happen before any disposition document has been issued; however, a dismissal can be issued at any time before the violation becomes a Confirmed Violation.

6. What does a dismissal look like?
Enforcement Analyst will issue a “Notice of Dismissal and Completion of Enforcement Action”
WECC:
Withdraws the Possible Violation from Entity’s compliance record
Any data retention directives relating to the possible violation are released
Entity:
Does not need to respond to notice
Questions/concerns contact Enforcement Analyst
If the Enforcement Analyst determines that a dismissal is warranted, the Enforcement Analyst will issue a “Notice of Dismissal.”
When the dismissal is issued:
The violation is withdrawn from the entity’s compliance history, and
No further action is required by the entity.

7. Compliance Exceptions
CEs are the exercise of Enforcement discretion
WECC reviews all PVs for CE treatment
Requirements of a CE:
Must be a Minimal risk issue
Additional Factors considered during CE analysis:
The quality of an RE’s internal compliance program (ICP)
Aggravating factors, such as repeat or repetitive noncompliance
Whether the issue reveals programmatic or systematic shortcomings
Whether the issue was submitted through the Self-Logging Process
Once it is determined that the Possible Violation is enforceable, Enforcement Analysts review the violation to determine if it meets the criteria for a Compliance Exception.
To be considered for Compliance Exception, the issue may only have a Minimal Risk to the BES.
While all violations with a minimal risk to the BES are reviewed for CE treatment, some violations are more likely than others to be processed as Compliance Exceptions.
Strong candidates are those that have a strong Internal Compliance Program, do not have repeat violations, and are not issues that exhibit programmatic or systematic shortcomings.
Self-Logged issues have the presumption of being processed as Compliance Exceptions.

8. What does a CE look like?
WECC Enforcement will issue a “Notice of Compliance Exception”
No Penalty or sanction
CE is filed with NERC but does not become a “confirmed violation”
Must be mitigated within 12 months of CE notification
A CE is part of an entity’s compliance history only to inform of potential risk.
A CE is not part of an entity’s violation history for purposes of aggravation of penalties.
Once an Enforcement Analyst makes its determination, a “Notice of Compliance Exception” will be issued to the entity and the information will be filed to NERC.
The Compliance Exception does not contain a penalty and will not become a confirmed violation.
The issue MUST be mitigated within 12 months of CE notification, or it can be reprocessed using a different disposition method.
A Compliance Exception will NOT be considered part of an entity’s compliance history moving forward for the aggravation of penalties, only to inform potential risk.

9. Find, Fix and Track (“FFT”)
FFTs are similar in concept to the CE
Differences between processing an FFT and CE:
Moderate risk issues may be considered for FFT treatment
FFTs contain an Affidavit to be returned by the Entity
FFTs will only be used in rare occurrences
If a possible violation does not meet the criteria of a Compliance Exception, it may be considered for FFT treatment.
FFTs are very similar in concept to Compliance Exceptions and take under consideration many of the same factors; however, FFTs may be used for those issues that don’t meet the more strict criteria of the Compliance Exception.
So, FFTs are only used in those rare occasions that a violation meets the criteria of an FFT, but does not meet the criteria for a Compliance Exception.
Strong candidates for FFT are those that were Self-Reported or Self-Certified, are not repeats, do not demonstrate systematic issues and have been mitigated or are in the process of being mitigated, but are Moderate Risk issues.

10. What does an FFT look like?
WECC Enforcement will issue a “Notice of Find, Fix and Track”
Remediation Required
No Penalty or sanction
FFT is filed with NERC but does not become a “confirmed violation”
FFT will become part of an Entity’s compliance history
Once the determination is made, Enforcement will issue and FFT to the Entity.
Similar to a Compliance Exception, when an FFT is issued, a mitigation plan and remediation of the violation are required, no penalties are issued, and the FFT does not become a confirmed violation.
Unlike the Compliance Exception, the FFT does become part of the entities compliance history, both to inform of potential risk and for the aggravation of penalties.

11. Notice of Alleged Violation (“NOAV”)
Issued in circumstances that do not warrant Dismissal, CE, FFT, or ESA treatment.
A notice issued by the Compliance Enforcement Authority to a Registered Entity pursuant to Section 5.3 of Appendix 4C. (CMEP)
The NOAV is the default disposition method for violations that do not meet the preferred disposition methods of Compliance Exception, FFT, or ESA.
It is the notice of the disposition described explicitly in NERC’s Compliance Monitoring and Enforcement Program (CMEP).

12. What does a NOAV look like?
NERC Rules of Procedure, Appendix 4C §5.3 (“CMEP”)
Alleged Violation Facts
Mitigation Plan Summary (if applicable)
Enforcement Violation Determinations
BES Impact Statement
Minimal
Moderate
Severe
Violation Severity Level (“VSL”)
Violation Risk Factor (“VRF”)
Penalty
As explained in the CMEP, a NOAV contains a summary of the Facts; the mitigating activities or planned mitigating activities; the determinations made by the Enforcement Analyst; and the penalty.
A NOAV also includes instructions on the actions that need to be taken following the receipt of a NOAV.

13. What to do with a NOAV? Submit a NOAV Response within 30 days
The NOAV Response must conform to one of three options
Agree with the violation AND penalty
Agree with the violation, but contest penalty
Contest both the violation AND penalty
Failure to submit a NOAV Response within 30 days will automatically result in confirmed violations with penalties
These instructions include that the Entity must submit a NOAV Response within 30 days and explains the Entities three options:
Agree with the violation AND penalty- Notice of Confirmed Violation will be sent to NERC
Agree with the violation, but contest penalty- WECC and the entity will enter the Settlement Process
Contest both the violation AND penalty- WECC and the entity will enter the Settlement Process
If the entity fails to submit the NOAV response, the violation, including the penalty, will automatically be confirmed and sent to NERC.

14. Work with Enforcement Analyst Settlement Negotiation
Reaching Settlement
NOAV
NOAV Response
Schedule Settlement
Work with Enforcement Analyst
Settlement Negotiation
Settlement Agreement
If the Entity chooses to contest the penalty or the violation and the penalty in the NOAV Response, the Settlement Process begins.
At this time, the Enforcement Analyst will schedule a time and venue for the settlement to take place.
However, the Entity and the Enforcement Analyst can continue to communicate and work through any issues before the scheduled Settlement Date.
They may come to an agreement on terms at any time. On or before the scheduled settlement date, the Entity and Enforcement will negotiate the terms of the settlement and reach an agreement.
After a settlement is reached, Enforcement, in collaboration with the Entity, will execute a Settlement Agreement.
Even if everything moves through the process with no set-backs or delays, the process from NOAV to Settlement Agreement takes approximately 3 months.

15. ESA: Expedited Settlement Process
Settlement Agreement
ESA
For this reason, we also have the Expedited Settlement Agreement. As you can see, the Expedited Settlement Agreement removes the middle steps from the process and goes straight to the Settlement Agreement.
An ESA is used in instances that do not fit the criteria of a Compliance Exception or FFT, but may be less severe or complex than an issue in a NOAV.
It is NOT a very commonly used disposition method.

16. What does an ESA look like?
Expedites Formal Settlement Negotiations
The ESA will contain
Facts and circumstances of the violation
Mitigation Plan Summary
Risk Assessment Summary
VSL and VRF determinations
Penalty determination
The ESA has many of the same elements as a NOAV.
It contains the facts of the violation, a risk assessment, details on mitigation plan submittals, a determination on the VSL and VRF, and a penalty determination.
However, unlike the NOAV, the ESA expedites the process by containing a greatly reduced penalty amount that represents WECC’s best offer to encourage expedited settlement with the Entity.
The penalty amount is NOT negotiable, because it would defeat the purpose of expediting the settlement.

17. What to do with an ESA? Entity will have 15 days to review the ESA…
The Entity will contact the Enforcement Analyst with questions or concerns.
If the Entity accepts the terms of the ESA…
The Entity must submit a signed copy of the ESA to WECC within 15 days of receipt of the ESA issuance.
If the Entity rejects the ESA or does not respond within 15 days…
WECC will issue a Notice of Alleged Violation and Proposed Penalty and Sanction.
If you receive an ESA, you will have 15 calendar days to review it and to discuss it with your Enforcement Analyst.
At the end of that 15 days, you must choose whether to accept it or reject it. If you choose to accept it, you will execute a signed copy of the ESA and return it to WECC. You are under no obligation to accept it.
If you choose to reject the ESA, or if you do not respond within the 15 days, WECC will re-issue the violation as a NOAV.
Remember, the ESA is a take it or leave it document and is not up for negotiation.

18. Penalties
Attached to violations disposed of using the NOAV or ESA processes
Based on:
NERC Sanction Guidelines (January 31, 2012)
Penalty Range
Penalty range depends upon Violation Severity Level (“VSL”) and Violation Risk Factor (“VRF”)
Penalties are then adjusted for either Mitigating or Aggravating Factors
Both the NOAV and ESA contain penalties. Penalties are based on both the NERC Sanction Guidelines and by the penalty range found within the Sanction Guidelines. The penalty range is a chart, produced by NERC, that uses the VSL and VRF to provide a minimum and maximum penalty for that violation. The Enforcement Analyst will also review mitigating factors and aggravating factors to make the ultimate penalty determination.
To determine a penalty or sanction, WECC considers various factors including, but not limited to:
Violation Risk Factor;
Violation Severity Level;
risk to the reliability of the bulk electric system (“BES”), including the seriousness of the violation;
Violation Time Horizon;
the violation’s duration;
the Registered Entity’s compliance history;
the Registered Entity’s self-reports and voluntary corrective action;
the degree and quality of cooperation by the Registered Entity in the audit or investigation process, and in any remedial action;
the quality of the Registered Entity’s compliance program;
any attempt by the Registered Entity to conceal the violation or any related information;
whether the violation was intentional;
any other relevant information or extenuating circumstances; and
the Registered Entity’s ability to pay a penalty, as applicable.

19. Enforcement Process WECC NERC FERC WECC
PV handoff to Enforcement Analyst
Enforcement Analyst Review
Dismissal*
NERC
FERC
Compliance Exception
FFT
Affidavit
ESA
Signed ESA
NOAV
NOAV Response
Settlement Negotiation and Agreement
Payment of Penalty
NOCV
WECC NERC FERC WECC
This is an overview of the disposition methods and the process that each goes through once the determination is made.
All of the disposition methods must be approved by both NERC and FERC before they are complete.
As you can see, there is one final part of the process for the penalties contained in the Settlement Agreements and Confirmed Violations.
*Dismissal could happen at any point prior to filing with NERC

20. Payment & Closure of Enforcement Actions
A penalty from a NOAV Settlement or ESA becomes effective after a review by NERC and FERC
At this time, WECC issues a “Payment Due Notice”
The Penalty will be due thirty (30) days from the date the Notice is issued
CASE CLOSED
Once a Settlement Agreement or Confirmed Violations has been reviewed by NERC and FERC, the penalty becomes effective.
At this time, WECC will issue a “Payment Due Notice” to the entity.
This allows the entity 30 days to provide the penalty amount to WECC.

21. Enforcement Process Summary
Possible Violation Submittal
Technical SME Review
The Hand-off to Enforcement Analyst
Enforcement Analyst Review
5 Methods of PV Disposition
Confirmed Violation
Lifecycle of a Possible Violation
Best Compliance Practices
Possible Violation Disposition and Entity Responses
Now that we have reviewed the lifecycle of a possible violation, if you still have any questions, feel free to contact your Enforcement Analyst or the Subject Matter Expert assigned to your case.
There is also additional information on Best Practices, provided in link on this slide.
Thank you.