NERC files report evaluating the CIP-014 Reliability Standard with FERC
The Commission directed NERC to evaluate whether the physical security protection requirements in NERC’s Reliability Standards are adequate to address the risks associated with physical attacks on BPS Facilities. Specifically, FERC directed NERC to conduct a study evaluating the following: (1) the adequacy of the Applicability criteria set forth in the Physical Security Reliability Standard; (2) the adequacy of the required risk assessment set forth in the Physical Security Reliability Standard; and (3) whether a minimum level of physical security protections should be required for all BPS substations and their associated primary control centers.
The purpose of the CIP-014 Reliability Standard is to “identify and protect Transmission stations and Transmission substations, and their associated primary control centers, that if rendered inoperable or damaged as a result of a physical attack could result in instability, uncontrolled separation, or Cascading within an Interconnection.”2 The standard requires applicable Transmission Owners (“TOs”) to perform periodic risk assessments of their applicable transmission stations and transmission substations (hereinafter collectively referred to as “substations”) to identify which of their applicable substations are “critical” to BPS reliability (which, for purposes of CIP-014, is whether instability, uncontrolled separation, or Cascading would result if the substation were damaged or rendered inoperable). The TO must then perform an evaluation of the potential physical security threats and vulnerabilities of a physical attack to each of their “critical” substations and develop and implement a documented physical security plan to address those threats and vulnerabilities. Additionally, for each primary control center that operationally controls an identified substation, the applicable Transmission Operator (“TOP”) must perform an evaluation of the potential physical security threats and vulnerabilities of a physical attack to that control center and develop and implement a documented physical security plan to address those threats and vulnerabilities.
As discussed within this report, NERC finds that the objective of CIP-014 appropriately focuses limited industry resources on risks to the reliable operation of the BPS associated with physical security incidents at the most critical facilities. Based on studies using available data, NERC finds that the CIP-014 Applicability criteria is meeting that objective and is broad enough to capture the subset of applicable facilities that TOs should identify as “critical” pursuant to the risks assessment mandated by Requirement R1. NERC did not find evidence that an expansion of the Applicability criteria would identify additional substations that would qualify as “critical” substations under the CIP- 014 Requirement R1 risk assessment. Accordingly, at this time, NERC is not recommending expansion of the CIP-014 Applicability criteria.
NERC acknowledges, however, that supplementary data3 could show that additional substation configurations would warrant assessment under CIP-014. Accordingly, NERC plans to continue evaluating the adequacy of the Applicability criteria in meeting the objective of CIP-014. Following issuance of this report, NERC will work with FERC staff to hold a technical conference to, among other things, identify the type of substation configurations that should be studied to determine whether any additional substations should be included in the Applicability criteria. The technical conference would also help establish data needs for conducting those studies
NERC finds, however, that the language in Requirement R1 of CIP-014 should be refined to ensure that entities conduct effective risk assessments of their applicable substations. Information from ERO Enterprise Compliance Monitoring and Enforcement Program (“CMEP”) activities indicates that while the overall objective of the CIP-014 Requirement R1 risk assessment is sound, there are inconsistent approaches to performing the risk assessment. The ERO Enterprise observed that, in certain instances, registered entities failed to provide sufficient technical studies or justification for study decisions resulting in noncompliance. NERC finds that the inconsistent approach to performing the risk assessment is largely due to a lack of specificity in the requirement language as to the nature and parameters of the risk assessment. Accordingly, NERC will initiate a Reliability Standards development project to evaluate changes to CIP-014 to provide additional clarity on the risk assessment.
As discussed further below, the objective of the Reliability Standards development project would be to:
• Clarify the risk assessment methods for studying instability, uncontrolled separation, and Cascading; such as the expectations of dynamic studies to evaluate for instability.
• Clarify the case(s) used for the assessment to be tailored to the Requirement R1 in-service window and correct any discrepancies between the study period, frequency of study, and the base case a TO uses.
• Clarify the documentation, posting, and usage of known criteria to identify instability, uncontrolled separation, or Cascading as part of the risk assessment. The criteria should also include defining “inoperable” or “damaged” substations such that the intent of the risk assessment is clear.
• Clarify the risk assessment to account for adjacent substations of differing ownership, and substations within line-of-sight to each other.
Finally, while NERC is not recommending an expansion of the CIP-014 Applicability criteria at this time, NERC finds that, given the increase in physical security attacks on BPS substations, there is a need to evaluate additional reliability, resiliency, and security measures designed to mitigate the risks associated with those physical security attacks. As discussed further below, establishing a uniform, bright line set of minimum physical security protections for all (or even an additional subset of) BPS substations and associated primary controls centers, is unlikely to be an effective approach to mitigating physical security risks and their potential impacts on the reliable operation of the BPS. While a uniform set of minimum level of protections could potentially prevent some forms of physical security threats, NERC finds that such a pursuit lacks the application of a risk-based approach to expending industry resources, fails to provide for a methodical approach necessary to address site-specific threats or objectives (as expected using a design basis threat process), and does not consider the need for other reliability, resiliency, and security measures to mitigate the impact of a physical attack. These combined measures provide increased operational and planning capability as well as improved effectiveness of local network restoration. NERC finds that this more holistic approach will provide greater long-term flexibility and minimize the impacts of physical attacks on BPS reliability.
Full report can be found here >>