380 St Peter Street Ste 800 Saint Paul MN 55102 MidwestReliabilityorg P6518551760 F6518551712

COMPLIANCE AUDIT

REPORT

PUBLIC VERSION

Confidential and Non-Public Information Removed (Does Not Contain Privileged and Critical Energy

Infrastructure Information)

Date(s) of On-Site Field Work May 13 ndash 15 2013

Date of Report June 21 2013

Muscatine Power amp Water

NERC Compliance Registry ID NCR00967

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | i

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Table of Contents Executive Summary 1

Registered Entity Profile 2

Internal Compliance Program and Controls 3

Audit Scope 3

Audit Process 5

Objectives 5

Methodology 6

Conflict of Interest and Confidentiality Rules 6

Audit Results 7

Possible Violation(s) 7

MRO Contact Information 8

Appendix I 9

MRO Audit Staff 9

Registered Entity Participants and Observers 9

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 1

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Executive Summary

Midwest Reliability Organization (MRO)1 conducted a compliance audit of Muscatine Power amp

Water (MPW) North American Electric Reliability Corporation (NERC) Compliance Registry

Number NCR00967 for the planned audit period July 1 2009 to April 28 2013 Within the

scope of the audit MPW was registered2 for the following functions

Member MISO CFR JRO00001 (BA)

Distribution Provider (DP)

Generator Operator (GOP)

Generator Owner (GO)

Load Serving Entity (LSE)

Purchasing Selling Entity (PSE)

Resource Planner (RP)

Transmission Operator (TOP)

Transmission Owner (TO)

Transmission Planner (TP)

MPWrsquos Primary Compliance Officer was provided notice of the compliance audit on February

12 2013 and an initial Request for Information (RFI) was provided to MPWrsquos Primary

Compliance Contact on February 12 2013 The on-site portion of the compliance audit was

conducted during the period of May 13 2013 to May 15 2013

The audit scope included the applicable Reliability Standards from the 2012 Compliance

Monitoring and Enforcement Program (CMEP) MROrsquos audit team reviewed the applicable

Reliability Standards3 for the period of July 1 2009 to April 28 2013

During the course of the audit a possible violation was discovered for the following

requirement(s)

1 PER-005-1 R1 System Personnel Trainings Each Reliability Coordinator Balancing

Authority and Transmission Operator shall use a systematic approach to training to

establish a training program for the BES company-specific reliability-related tasks

performed by its System Operators and shall implement the program

1 MRO is a Regional Entity in North America operating under authority from regulators in the United States and Canada through

a delegation agreement with the North American Electric Reliability Corporation (NERC) In the United States MRO operates

under the authority found in Section 215 of the Federal Power Act through the Federal Energy Regulatory Commission (FERC

or Commission) and through other arrangements in Manitoba and Saskatchewan The primary focus of MRO is assessing

compliance with Reliability Standards on entities that own operate or use the Bulk Electric System (BES) performing

assessments of the BES and technical analysis of matters impacting the reliability of the BES in the north central part of North

America For more information on MRO please refer to wwwmidwestreliabilityorg

2 Each owner user or operator of the BES is listed on a registry which can be found on NERCrsquos website Entities on the registry

are referred to as ldquoRegistered Entitiesrdquo

3 An entire list of Reliability Standards can be found on NERCrsquos website

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | i

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Table of Contents Executive Summary 1

Registered Entity Profile 2

Internal Compliance Program and Controls 3

Audit Scope 3

Audit Process 5

Objectives 5

Methodology 6

Conflict of Interest and Confidentiality Rules 6

Audit Results 7

Possible Violation(s) 7

MRO Contact Information 8

Appendix I 9

MRO Audit Staff 9

Registered Entity Participants and Observers 9

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 1

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Executive Summary

Midwest Reliability Organization (MRO)1 conducted a compliance audit of Muscatine Power amp

Water (MPW) North American Electric Reliability Corporation (NERC) Compliance Registry

Number NCR00967 for the planned audit period July 1 2009 to April 28 2013 Within the

scope of the audit MPW was registered2 for the following functions

Member MISO CFR JRO00001 (BA)

Distribution Provider (DP)

Generator Operator (GOP)

Generator Owner (GO)

Load Serving Entity (LSE)

Purchasing Selling Entity (PSE)

Resource Planner (RP)

Transmission Operator (TOP)

Transmission Owner (TO)

Transmission Planner (TP)

MPWrsquos Primary Compliance Officer was provided notice of the compliance audit on February

12 2013 and an initial Request for Information (RFI) was provided to MPWrsquos Primary

Compliance Contact on February 12 2013 The on-site portion of the compliance audit was

conducted during the period of May 13 2013 to May 15 2013

The audit scope included the applicable Reliability Standards from the 2012 Compliance

Monitoring and Enforcement Program (CMEP) MROrsquos audit team reviewed the applicable

Reliability Standards3 for the period of July 1 2009 to April 28 2013

During the course of the audit a possible violation was discovered for the following

requirement(s)

1 PER-005-1 R1 System Personnel Trainings Each Reliability Coordinator Balancing

Authority and Transmission Operator shall use a systematic approach to training to

establish a training program for the BES company-specific reliability-related tasks

performed by its System Operators and shall implement the program

1 MRO is a Regional Entity in North America operating under authority from regulators in the United States and Canada through

a delegation agreement with the North American Electric Reliability Corporation (NERC) In the United States MRO operates

under the authority found in Section 215 of the Federal Power Act through the Federal Energy Regulatory Commission (FERC

or Commission) and through other arrangements in Manitoba and Saskatchewan The primary focus of MRO is assessing

compliance with Reliability Standards on entities that own operate or use the Bulk Electric System (BES) performing

assessments of the BES and technical analysis of matters impacting the reliability of the BES in the north central part of North

America For more information on MRO please refer to wwwmidwestreliabilityorg

2 Each owner user or operator of the BES is listed on a registry which can be found on NERCrsquos website Entities on the registry

are referred to as ldquoRegistered Entitiesrdquo

3 An entire list of Reliability Standards can be found on NERCrsquos website

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 1

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Executive Summary

Midwest Reliability Organization (MRO)1 conducted a compliance audit of Muscatine Power amp

Water (MPW) North American Electric Reliability Corporation (NERC) Compliance Registry

Number NCR00967 for the planned audit period July 1 2009 to April 28 2013 Within the

scope of the audit MPW was registered2 for the following functions

Member MISO CFR JRO00001 (BA)

Distribution Provider (DP)

Generator Operator (GOP)

Generator Owner (GO)

Load Serving Entity (LSE)

Purchasing Selling Entity (PSE)

Resource Planner (RP)

Transmission Operator (TOP)

Transmission Owner (TO)

Transmission Planner (TP)

MPWrsquos Primary Compliance Officer was provided notice of the compliance audit on February

12 2013 and an initial Request for Information (RFI) was provided to MPWrsquos Primary

Compliance Contact on February 12 2013 The on-site portion of the compliance audit was

conducted during the period of May 13 2013 to May 15 2013

The audit scope included the applicable Reliability Standards from the 2012 Compliance

Monitoring and Enforcement Program (CMEP) MROrsquos audit team reviewed the applicable

Reliability Standards3 for the period of July 1 2009 to April 28 2013

During the course of the audit a possible violation was discovered for the following

requirement(s)

1 PER-005-1 R1 System Personnel Trainings Each Reliability Coordinator Balancing

Authority and Transmission Operator shall use a systematic approach to training to

establish a training program for the BES company-specific reliability-related tasks

performed by its System Operators and shall implement the program

1 MRO is a Regional Entity in North America operating under authority from regulators in the United States and Canada through

a delegation agreement with the North American Electric Reliability Corporation (NERC) In the United States MRO operates

under the authority found in Section 215 of the Federal Power Act through the Federal Energy Regulatory Commission (FERC

or Commission) and through other arrangements in Manitoba and Saskatchewan The primary focus of MRO is assessing

compliance with Reliability Standards on entities that own operate or use the Bulk Electric System (BES) performing

assessments of the BES and technical analysis of matters impacting the reliability of the BES in the north central part of North

America For more information on MRO please refer to wwwmidwestreliabilityorg

2 Each owner user or operator of the BES is listed on a registry which can be found on NERCrsquos website Entities on the registry

are referred to as ldquoRegistered Entitiesrdquo

3 An entire list of Reliability Standards can be found on NERCrsquos website

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 2

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

R12 Each Reliability Coordinator Balancing Authority and Transmission

Operator shall design and develop learning objectives and training materials

based on the task list created in R11

2 PRC-005-1b R2 Transmission and Generation Protection System Maintenance and

Testing Each Transmission Owner and any Distribution Provider that owns a

transmission Protection System and each Generator Owner that owns a generation

Protection System shall provide documentation of its Protection System maintenance

and testing program and the implementation of that program to its Regional Reliability

Organization on request (within 30 calendar days) The documentation of the program

implementation shall include

R21 Evidence Protection System devices were maintained and tested within the

defined intervals

R22 Date each Protection System device was last testedmaintained

3 PRC-008-0 R2 Implementation and Documentation of Underfrequency Load Shedding

Equipment Maintenance Program The Transmission Owner and Distribution Provider

with a UFLS program (as required by its Regional Reliability Organization) shall

implement its UFLS equipment maintenance and testing program and shall provide

UFLS maintenance and testing program results to its Regional Reliability Organization

and NERC on request (within 30 calendar days)

These audit results are further explained later in this report Any possible violations are

processed through the CMEP

MRO staff followed the applicable requirements of the Rules of Procedure (ROP) and CMEP in

the conduct of the compliance audit

The scope of the audit included review of mitigation plans from past enforcement proceedings

andor open remedies from settlements as a result of past enforcement proceedings related to

violations

Registered Entity Profile

Muscatine Power and Water (MPW) is a customer-driven municipal utility They provide

electric water and communications products and services MPW is headquartered in Muscatine

Iowa a historic town of 22719 located on the banks of the Mississippi River 20 miles

downstream from the IllinoisIowa Quad Cities

MPW provides electricity to approximately 11225 customers and water to more than 9500

customers They own and operate three coal-fired electric generating facilities with a combined

nameplate capacity of 29355 MW

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 3

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

As of June 1 2010

Electric Utility

Unit 7 generator capacity ndash 25 MW

Unit 8 generator capacity ndash 75 MW

Unit 8A generator capacity ndash 1805 MW

Unit 9 generator capacity ndash 17550 MW

Total nameplate generator nameplate capacity ndash 29355 MW

Previous years peak load (6232009) ndash 139 MW

All-time peak load (7291999) ndash 14990 MW

Average residential electric rate for the year ending 123109 - $00727kWh

Muscatine Electric Light Company was formed in 1922 and merged with Muscatine Water

Works in 1929 They changed their name in 1967 from Muscatine Water and Light to Muscatine

Power and Water

Internal Compliance Program and Controls

Within the scope of the compliance audit MPWrsquos compliance program and related controls

applicable to the Reliability Standards were reviewed during the audit For enforcement

purposes internal compliance program and other pertinent information are reviewed by the

MRO enforcement staff and may be considered during any enforcement proceedings resulting

from a finding of a possible violation as a result of the compliance audit

Audit Scope

MRO performed the compliance audit according to the planned scope and timing previously

communicated to MPW and included the Reliability Standards from MROrsquos Implementation

Plan for an audit period of July 1 2009 to April 28 2013

MPW is registered for the following functions

Member MISO CFR JRO00001 (BA)

Distribution Provider (DP)

Generator Operator (GOP)

Generator Owner (GO)

Load Serving Entity (LSE)

Purchasing Selling Entity (PSE)

Resource Planner (RP)

Transmission Operator (TOP)

Transmission Owner (TO)

Transmission Planner (TP)

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 4

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

The following Reliability Standards were included in the scope of the compliance audit

Standard(s) Requirements Title

BAL-002-1 R3 Disturbance Control Performance

CIP-001-2a R2 R3 Sabotage Reporting

COM-001-11 R1 R2 Telecommunications

COM-002-2 R2 Communications and Coordination

EOP-001-0b R3 R7 Emergency Operations Planning

EOP-002-3 R7 Capacity and Energy Emergencies

EOP-004-1 R3 Disturbance Reporting

EOP-005-1 R2 R4 R6 R10 R11 System Restoration Plans

EOP-008-0 R1 Loss of Control Center Functionality

FAC-001-0 R2 Facility Connection Requirements

FAC-002-1 R1 Coordination of Plans For New Generation Transmission and

End-User Facilities

FAC-003-1 R1 R2 Transmission Vegetation Management Program

FAC-008-3 R1 R2 R3 R6 R7 Facility Ratings

FAC-014-2 R2 R4 Establish and Communicate System Operating Limits

IRO-004-2 R1 Reliability Coordination - Operations Planning

IRO-005-3a R9 R10 Reliability Coordination - Current Day Operations

MOD-001-1a R1 R6 Available Transmission System Capability

MOD-004-1 R3 R4 R6 R8 R9

R10 R11

Capacity Benefit Margin

MOD-008-1 R1 R2 R3 R4 R5 Transmission Reliability Margin Calculation Methodology

NUC-001-2 R4 R5 Nuclear Plant Interface Coordination

PER-005-1 R1 R2 R3 System Personnel Training

PRC-001-1 R1 R2 R3 System Protection Coordination

PRC-005-1b R1 R2 Transmission and Generation Protection System Maintenance

and Testing

PRC-008-0 R1 R2 Implementation and Documentation of Underfrequency Load

Shedding Equipment Maintenance Program

PRC-017-0 R1 R2 Special Protection System Maintenance and Testing

PRC-023-2 R1 R2 R3 R4 R5 Transmission Relay Loadability

TOP-002-2b R17 R18 Normal Operations Planning

TOP-004-2 R4 R6 Transmission Operations

TOP-007-0 R1 R2 R3 Reporting System Operating Limit (SOL) and Interconnection

Reliability Operating Limit (IROL) Violations

TPL-003-0a R1 R2 R3 System Performance Following Loss of Two or More Bulk

Electric System Elements (Category C)

TPL-004-0 R2 System Performance Following Extreme Events Resulting in the

Loss of Two or More Bulk Electric System Elements (Category

D)

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 5

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

The MRO audit team determined that the following Reliability Standard(s) or requirement(s) were

not applicable to MPW during the compliance audit

1 BAL-002-1 Disturbance Control Performance

2 FAC-003-1 Transmission Vegetation Management Program

3 NUC-001-2 Nuclear Plant Interface Coordination

4 PRC-017-0 Special Protection System Maintenance and Testing

5 PRC-023-2 Transmission Relay Loadability

Audit Process

MRO conducts compliance audits in accordance with the current version of the CMEP and ROP

(as approved by the Federal Energy Regulatory Commission for entities in the United States or

through other arrangements in Manitoba and Saskatchewan) and generally conforms to the

United States Government Accountability Office Government Auditing Standards and other

generally accepted audit practices applicable to the conduct of the work The compliance audit

process steps can be found in the NERC CMEP

Compliance audits are conducted to obtain reasonable assurance of compliance with the

applicable Reliability Standards The compliance audit includes requests for data such as

program documents procedures and performance records considered necessary to provide

reasonable assurance of any findings or conclusions Audit procedures include tests of

documentary evidence supporting compliance tests of the assertions made regarding

compliance and direct confirmation of actions taken as part of compliance with the Reliability

Standards

If possible violations are identified the matter is turned over to MRO Risk Assessment and

Mitigation staff to initiate mitigation and enforcement proceedings under the CMEP The staff

will contact the designated Primary Compliance Contact or MPW may contact MRO staff at any

time Upon validation by Enforcement staff MPW will be provided a written notice of the

alleged violation within a reasonable timeframe that shall include the due process protections

under the CMEP

MPW is encouraged to maintain an adequate internal compliance program designed to ensure

compliance with Reliability Standards to protect the reliability of the Bulk Electric System

(BES) The program should contain internal controls designed to detect correct and prevent

recurrence of compliance violations

Objectives

Entities that own operate or use the BES in North America are subject to compliance audits for

applicable Reliability Standards based upon the functions performed within the scope of the

compliance audit The primary audit objectives are to

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 6

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

1 Provide reasonable assurance of compliance to the identified applicable Reliability

Standards

2 Provide a reasonable basis for all determinations of any findings or conclusions

3 Evaluate and identify the internal controls utilized by the Registered Entity for performance

measurement(s) within their compliance program

Methodology

The audit team reviewed the information data and evidence submitted by MPW and assessed

compliance with requirements of the applicable Reliability Standards Submittal of information

and data to MRO occurred before the scheduled date of the entity review or within the submittal

parameters as described in subsequent RFIs

Based upon the evaluation of initial information provided to the audit team supplemental RFIs

were requested and clarifications were sought from subject matter experts

MRO staff was provided the necessary information and adequate access to subject matter experts

without unreasonable restrictions

The audit team reviewed documentation and evidence provided by MPW such as programs

policies procedures emails logs studies data sheets and other relevant information Where

evaluation of compliance with a Requirement involved sampling the necessary samples were

developed according to the NERC Sampling Methodology Guidelines MRO audit staff obtained

sufficient appropriate evidence to provide a reasonable basis for any findings and conclusions

The audit report is subject to review by MRO executive staff and any findings are subject to a

second independent review by MRO Risk Assessment and Mitigation staff which is not

included in this report If there are findings as a result of the compliance audit Risk Assessment

and Mitigation staff from MRO will contact MPW

Conflict of Interest and Confidentiality Rules

Confidentiality and Conflict of Interest of MRO audit staff are governed under the MRO

Regional Delegation Agreement with NERC Section 1500 of the NERC ROP MRO Policy and

Procedure 5 Confidentiality MRO Policy and Procedure 10 Conflict of Interest and the MRO

employee handbook MPW was informed of MROrsquos obligations and responsibilities under the

Regional Delegation Agreement and NERC ROP and was provided with a list of MRO audit

staff and corresponding work histories There have been no denials of or access limitations

placed upon this audit team and no objections to MRO staff assignments on the compliance

audit

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 7

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Audit Results

Possible Violation(s)

Based upon the scope and conduct of the compliance audit the audit team identified the

following possible violations

1 PER-005-1 R1 System Personnel Trainings Each Reliability Coordinator Balancing

Authority and Transmission Operator shall use a systematic approach to training to

establish a training program for the BES company-specific reliability-related tasks

performed by its System Operators and shall implement the program

R12 Each Reliability Coordinator Balancing Authority and Transmission Operator

shall design and develop learning objectives and training materials based on the task list

created in R11

2 PRC-005-1 R2 Transmission and Generation Protection System Maintenance and Testing

Each Transmission Owner and any Distribution Provider that owns a transmission

Protection System and each Generator Owner that owns a generation Protection System

shall provide documentation of its Protection System maintenance and testing program and

the implementation of that program to its Regional Reliability Organization on request

(within 30 calendar days) The documentation of the program implementation shall include

R21 Evidence Protection System devices were maintained and tested within the defined

intervals

R22 Date each Protection System device was last testedmaintained

3 PRC-008-0 R2 Implementation and Documentation of Underfrequency Load Shedding

Equipment Maintenance Program The Transmission Owner and Distribution Provider with

a UFLS program (as required by its Regional Reliability Organization) shall implement its

UFLS equipment maintenance and testing program and shall provide UFLS maintenance

and testing program results to its Regional Reliability Organization and NERC on request

(within 30 calendar days)

The aforementioned possible violation(s) and the audit report will be provided to MRO Risk

Assessment and Mitigation staff to initiate mitigation and enforcement proceedings under the

CMEP which will consider the matters in this report consistent with the applicable requirements

of the CMEP The staff will contact the designated Primary Compliance Contact or MPW may

contact MRO staff at any time

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 8

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

MRO Contact Information

Any questions regarding this compliance audit report can be directed to

Midwest Reliability Organization

Attn Thomas P Tierney Director of Compliance

380 St Peter Street Suite 800

St Paul MN 55102

tptierneymidwestreliabilityorg

(651) 855-1745

On behalf of MRO this report was prepared and reviewed by

Audit Team Lead Signature Date

Carol A Gerou

6212013

Director of Compliance Signature Date

Thomas P Tierney

6212013

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 9

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Appendix I

MRO Audit Staff

Title Entity

Audit Team Lead Compliance Engineer MRO

Senior Compliance Engineer MRO

Compliance Audit Specialist MRO

Compliance Audit Specialist MRO

CIP Audit Specialist MRO

CIP Audit Specialist MRO

CIP Audit Specialist MRO

Registered Entity Participants and Observers

Title Entity

Manager Reliability Standards Compliance MPW

Director Legal amp Regulatory Services MPW

Director Employee and Customer Relations MPW

Control Center Supervisor and Trainer MPW

System Operator II MPW

System Operator II MPW

Manager Control Center MPW

SCADA System Administrator MPW

SCADA Specialist MPW

Summer Intern MPW

Planning Engineer MPW

Manager Transmission and Distribution MPW

System Maintenance Specialist II MPW

General Manager MPW

Manager Telecommunications MPW

Administrative Assistant MPW

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 10

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Title Entity

System Specialist MPW

Generation Technical Supervisor MPW

Director Power Production and Supply MPW

Director Utility Service Delivery MPW

System Operator II MPW

Assistant Generation Operations Supervisor MPW

Communications Chief Technician MPW

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 5

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

The MRO audit team determined that the following Reliability Standard(s) or requirement(s) were

not applicable to MPW during the compliance audit

1 BAL-002-1 Disturbance Control Performance

2 FAC-003-1 Transmission Vegetation Management Program

3 NUC-001-2 Nuclear Plant Interface Coordination

4 PRC-017-0 Special Protection System Maintenance and Testing

5 PRC-023-2 Transmission Relay Loadability

Audit Process

MRO conducts compliance audits in accordance with the current version of the CMEP and ROP

(as approved by the Federal Energy Regulatory Commission for entities in the United States or

through other arrangements in Manitoba and Saskatchewan) and generally conforms to the

United States Government Accountability Office Government Auditing Standards and other

generally accepted audit practices applicable to the conduct of the work The compliance audit

process steps can be found in the NERC CMEP

Compliance audits are conducted to obtain reasonable assurance of compliance with the

applicable Reliability Standards The compliance audit includes requests for data such as

program documents procedures and performance records considered necessary to provide

reasonable assurance of any findings or conclusions Audit procedures include tests of

documentary evidence supporting compliance tests of the assertions made regarding

compliance and direct confirmation of actions taken as part of compliance with the Reliability

Standards

If possible violations are identified the matter is turned over to MRO Risk Assessment and

Mitigation staff to initiate mitigation and enforcement proceedings under the CMEP The staff

will contact the designated Primary Compliance Contact or MPW may contact MRO staff at any

time Upon validation by Enforcement staff MPW will be provided a written notice of the

alleged violation within a reasonable timeframe that shall include the due process protections

under the CMEP

MPW is encouraged to maintain an adequate internal compliance program designed to ensure

compliance with Reliability Standards to protect the reliability of the Bulk Electric System

(BES) The program should contain internal controls designed to detect correct and prevent

recurrence of compliance violations

Objectives

Entities that own operate or use the BES in North America are subject to compliance audits for

applicable Reliability Standards based upon the functions performed within the scope of the

compliance audit The primary audit objectives are to

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 6

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

1 Provide reasonable assurance of compliance to the identified applicable Reliability

Standards

2 Provide a reasonable basis for all determinations of any findings or conclusions

3 Evaluate and identify the internal controls utilized by the Registered Entity for performance

measurement(s) within their compliance program

Methodology

The audit team reviewed the information data and evidence submitted by MPW and assessed

compliance with requirements of the applicable Reliability Standards Submittal of information

and data to MRO occurred before the scheduled date of the entity review or within the submittal

parameters as described in subsequent RFIs

Based upon the evaluation of initial information provided to the audit team supplemental RFIs

were requested and clarifications were sought from subject matter experts

MRO staff was provided the necessary information and adequate access to subject matter experts

without unreasonable restrictions

The audit team reviewed documentation and evidence provided by MPW such as programs

policies procedures emails logs studies data sheets and other relevant information Where

evaluation of compliance with a Requirement involved sampling the necessary samples were

developed according to the NERC Sampling Methodology Guidelines MRO audit staff obtained

sufficient appropriate evidence to provide a reasonable basis for any findings and conclusions

The audit report is subject to review by MRO executive staff and any findings are subject to a

second independent review by MRO Risk Assessment and Mitigation staff which is not

included in this report If there are findings as a result of the compliance audit Risk Assessment

and Mitigation staff from MRO will contact MPW

Conflict of Interest and Confidentiality Rules

Confidentiality and Conflict of Interest of MRO audit staff are governed under the MRO

Regional Delegation Agreement with NERC Section 1500 of the NERC ROP MRO Policy and

Procedure 5 Confidentiality MRO Policy and Procedure 10 Conflict of Interest and the MRO

employee handbook MPW was informed of MROrsquos obligations and responsibilities under the

Regional Delegation Agreement and NERC ROP and was provided with a list of MRO audit

staff and corresponding work histories There have been no denials of or access limitations

placed upon this audit team and no objections to MRO staff assignments on the compliance

audit

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 7

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Audit Results

Possible Violation(s)

Based upon the scope and conduct of the compliance audit the audit team identified the

following possible violations

1 PER-005-1 R1 System Personnel Trainings Each Reliability Coordinator Balancing

Authority and Transmission Operator shall use a systematic approach to training to

establish a training program for the BES company-specific reliability-related tasks

performed by its System Operators and shall implement the program

R12 Each Reliability Coordinator Balancing Authority and Transmission Operator

shall design and develop learning objectives and training materials based on the task list

created in R11

2 PRC-005-1 R2 Transmission and Generation Protection System Maintenance and Testing

Each Transmission Owner and any Distribution Provider that owns a transmission

Protection System and each Generator Owner that owns a generation Protection System

shall provide documentation of its Protection System maintenance and testing program and

the implementation of that program to its Regional Reliability Organization on request

(within 30 calendar days) The documentation of the program implementation shall include

R21 Evidence Protection System devices were maintained and tested within the defined

intervals

R22 Date each Protection System device was last testedmaintained

3 PRC-008-0 R2 Implementation and Documentation of Underfrequency Load Shedding

Equipment Maintenance Program The Transmission Owner and Distribution Provider with

a UFLS program (as required by its Regional Reliability Organization) shall implement its

UFLS equipment maintenance and testing program and shall provide UFLS maintenance

and testing program results to its Regional Reliability Organization and NERC on request

(within 30 calendar days)

The aforementioned possible violation(s) and the audit report will be provided to MRO Risk

Assessment and Mitigation staff to initiate mitigation and enforcement proceedings under the

CMEP which will consider the matters in this report consistent with the applicable requirements

of the CMEP The staff will contact the designated Primary Compliance Contact or MPW may

contact MRO staff at any time

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 8

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

MRO Contact Information

Any questions regarding this compliance audit report can be directed to

Midwest Reliability Organization

Attn Thomas P Tierney Director of Compliance

380 St Peter Street Suite 800

St Paul MN 55102

tptierneymidwestreliabilityorg

(651) 855-1745

On behalf of MRO this report was prepared and reviewed by

Audit Team Lead Signature Date

Carol A Gerou

6212013

Director of Compliance Signature Date

Thomas P Tierney

6212013

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 9

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Appendix I

MRO Audit Staff

Title Entity

Audit Team Lead Compliance Engineer MRO

Senior Compliance Engineer MRO

Compliance Audit Specialist MRO

Compliance Audit Specialist MRO

CIP Audit Specialist MRO

CIP Audit Specialist MRO

CIP Audit Specialist MRO

Registered Entity Participants and Observers

Title Entity

Manager Reliability Standards Compliance MPW

Director Legal amp Regulatory Services MPW

Director Employee and Customer Relations MPW

Control Center Supervisor and Trainer MPW

System Operator II MPW

System Operator II MPW

Manager Control Center MPW

SCADA System Administrator MPW

SCADA Specialist MPW

Summer Intern MPW

Planning Engineer MPW

Manager Transmission and Distribution MPW

System Maintenance Specialist II MPW

General Manager MPW

Manager Telecommunications MPW

Administrative Assistant MPW

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 10

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Title Entity

System Specialist MPW

Generation Technical Supervisor MPW

Director Power Production and Supply MPW

Director Utility Service Delivery MPW

System Operator II MPW

Assistant Generation Operations Supervisor MPW

Communications Chief Technician MPW

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 6

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

1 Provide reasonable assurance of compliance to the identified applicable Reliability

Standards

2 Provide a reasonable basis for all determinations of any findings or conclusions

3 Evaluate and identify the internal controls utilized by the Registered Entity for performance

measurement(s) within their compliance program

Methodology

The audit team reviewed the information data and evidence submitted by MPW and assessed

compliance with requirements of the applicable Reliability Standards Submittal of information

and data to MRO occurred before the scheduled date of the entity review or within the submittal

parameters as described in subsequent RFIs

Based upon the evaluation of initial information provided to the audit team supplemental RFIs

were requested and clarifications were sought from subject matter experts

MRO staff was provided the necessary information and adequate access to subject matter experts

without unreasonable restrictions

The audit team reviewed documentation and evidence provided by MPW such as programs

policies procedures emails logs studies data sheets and other relevant information Where

evaluation of compliance with a Requirement involved sampling the necessary samples were

developed according to the NERC Sampling Methodology Guidelines MRO audit staff obtained

sufficient appropriate evidence to provide a reasonable basis for any findings and conclusions

The audit report is subject to review by MRO executive staff and any findings are subject to a

second independent review by MRO Risk Assessment and Mitigation staff which is not

included in this report If there are findings as a result of the compliance audit Risk Assessment

and Mitigation staff from MRO will contact MPW

Conflict of Interest and Confidentiality Rules

Confidentiality and Conflict of Interest of MRO audit staff are governed under the MRO

Regional Delegation Agreement with NERC Section 1500 of the NERC ROP MRO Policy and

Procedure 5 Confidentiality MRO Policy and Procedure 10 Conflict of Interest and the MRO

employee handbook MPW was informed of MROrsquos obligations and responsibilities under the

Regional Delegation Agreement and NERC ROP and was provided with a list of MRO audit

staff and corresponding work histories There have been no denials of or access limitations

placed upon this audit team and no objections to MRO staff assignments on the compliance

audit

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 7

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Audit Results

Possible Violation(s)

Based upon the scope and conduct of the compliance audit the audit team identified the

following possible violations

1 PER-005-1 R1 System Personnel Trainings Each Reliability Coordinator Balancing

Authority and Transmission Operator shall use a systematic approach to training to

establish a training program for the BES company-specific reliability-related tasks

performed by its System Operators and shall implement the program

R12 Each Reliability Coordinator Balancing Authority and Transmission Operator

shall design and develop learning objectives and training materials based on the task list

created in R11

2 PRC-005-1 R2 Transmission and Generation Protection System Maintenance and Testing

Each Transmission Owner and any Distribution Provider that owns a transmission

Protection System and each Generator Owner that owns a generation Protection System

shall provide documentation of its Protection System maintenance and testing program and

the implementation of that program to its Regional Reliability Organization on request

(within 30 calendar days) The documentation of the program implementation shall include

R21 Evidence Protection System devices were maintained and tested within the defined

intervals

R22 Date each Protection System device was last testedmaintained

3 PRC-008-0 R2 Implementation and Documentation of Underfrequency Load Shedding

Equipment Maintenance Program The Transmission Owner and Distribution Provider with

a UFLS program (as required by its Regional Reliability Organization) shall implement its

UFLS equipment maintenance and testing program and shall provide UFLS maintenance

and testing program results to its Regional Reliability Organization and NERC on request

(within 30 calendar days)

The aforementioned possible violation(s) and the audit report will be provided to MRO Risk

Assessment and Mitigation staff to initiate mitigation and enforcement proceedings under the

CMEP which will consider the matters in this report consistent with the applicable requirements

of the CMEP The staff will contact the designated Primary Compliance Contact or MPW may

contact MRO staff at any time

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 8

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

MRO Contact Information

Any questions regarding this compliance audit report can be directed to

Midwest Reliability Organization

Attn Thomas P Tierney Director of Compliance

380 St Peter Street Suite 800

St Paul MN 55102

tptierneymidwestreliabilityorg

(651) 855-1745

On behalf of MRO this report was prepared and reviewed by

Audit Team Lead Signature Date

Carol A Gerou

6212013

Director of Compliance Signature Date

Thomas P Tierney

6212013

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 9

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Appendix I

MRO Audit Staff

Title Entity

Audit Team Lead Compliance Engineer MRO

Senior Compliance Engineer MRO

Compliance Audit Specialist MRO

Compliance Audit Specialist MRO

CIP Audit Specialist MRO

CIP Audit Specialist MRO

CIP Audit Specialist MRO

Registered Entity Participants and Observers

Title Entity

Manager Reliability Standards Compliance MPW

Director Legal amp Regulatory Services MPW

Director Employee and Customer Relations MPW

Control Center Supervisor and Trainer MPW

System Operator II MPW

System Operator II MPW

Manager Control Center MPW

SCADA System Administrator MPW

SCADA Specialist MPW

Summer Intern MPW

Planning Engineer MPW

Manager Transmission and Distribution MPW

System Maintenance Specialist II MPW

General Manager MPW

Manager Telecommunications MPW

Administrative Assistant MPW

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 10

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Title Entity

System Specialist MPW

Generation Technical Supervisor MPW

Director Power Production and Supply MPW

Director Utility Service Delivery MPW

System Operator II MPW

Assistant Generation Operations Supervisor MPW

Communications Chief Technician MPW

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 7

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Audit Results

Possible Violation(s)

Based upon the scope and conduct of the compliance audit the audit team identified the

following possible violations

1 PER-005-1 R1 System Personnel Trainings Each Reliability Coordinator Balancing

Authority and Transmission Operator shall use a systematic approach to training to

establish a training program for the BES company-specific reliability-related tasks

performed by its System Operators and shall implement the program

R12 Each Reliability Coordinator Balancing Authority and Transmission Operator

shall design and develop learning objectives and training materials based on the task list

created in R11

2 PRC-005-1 R2 Transmission and Generation Protection System Maintenance and Testing

Each Transmission Owner and any Distribution Provider that owns a transmission

Protection System and each Generator Owner that owns a generation Protection System

shall provide documentation of its Protection System maintenance and testing program and

the implementation of that program to its Regional Reliability Organization on request

(within 30 calendar days) The documentation of the program implementation shall include

R21 Evidence Protection System devices were maintained and tested within the defined

intervals

R22 Date each Protection System device was last testedmaintained

3 PRC-008-0 R2 Implementation and Documentation of Underfrequency Load Shedding

Equipment Maintenance Program The Transmission Owner and Distribution Provider with

a UFLS program (as required by its Regional Reliability Organization) shall implement its

UFLS equipment maintenance and testing program and shall provide UFLS maintenance

and testing program results to its Regional Reliability Organization and NERC on request

(within 30 calendar days)

The aforementioned possible violation(s) and the audit report will be provided to MRO Risk

Assessment and Mitigation staff to initiate mitigation and enforcement proceedings under the

CMEP which will consider the matters in this report consistent with the applicable requirements

of the CMEP The staff will contact the designated Primary Compliance Contact or MPW may

contact MRO staff at any time

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 8

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

MRO Contact Information

Any questions regarding this compliance audit report can be directed to

Midwest Reliability Organization

Attn Thomas P Tierney Director of Compliance

380 St Peter Street Suite 800

St Paul MN 55102

tptierneymidwestreliabilityorg

(651) 855-1745

On behalf of MRO this report was prepared and reviewed by

Audit Team Lead Signature Date

Carol A Gerou

6212013

Director of Compliance Signature Date

Thomas P Tierney

6212013

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 9

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Appendix I

MRO Audit Staff

Title Entity

Audit Team Lead Compliance Engineer MRO

Senior Compliance Engineer MRO

Compliance Audit Specialist MRO

Compliance Audit Specialist MRO

CIP Audit Specialist MRO

CIP Audit Specialist MRO

CIP Audit Specialist MRO

Registered Entity Participants and Observers

Title Entity

Manager Reliability Standards Compliance MPW

Director Legal amp Regulatory Services MPW

Director Employee and Customer Relations MPW

Control Center Supervisor and Trainer MPW

System Operator II MPW

System Operator II MPW

Manager Control Center MPW

SCADA System Administrator MPW

SCADA Specialist MPW

Summer Intern MPW

Planning Engineer MPW

Manager Transmission and Distribution MPW

System Maintenance Specialist II MPW

General Manager MPW

Manager Telecommunications MPW

Administrative Assistant MPW

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 10

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Title Entity

System Specialist MPW

Generation Technical Supervisor MPW

Director Power Production and Supply MPW

Director Utility Service Delivery MPW

System Operator II MPW

Assistant Generation Operations Supervisor MPW

Communications Chief Technician MPW

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 8

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

MRO Contact Information

Any questions regarding this compliance audit report can be directed to

Midwest Reliability Organization

Attn Thomas P Tierney Director of Compliance

380 St Peter Street Suite 800

St Paul MN 55102

tptierneymidwestreliabilityorg

(651) 855-1745

On behalf of MRO this report was prepared and reviewed by

Audit Team Lead Signature Date

Carol A Gerou

6212013

Director of Compliance Signature Date

Thomas P Tierney

6212013

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 9

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Appendix I

MRO Audit Staff

Title Entity

Audit Team Lead Compliance Engineer MRO

Senior Compliance Engineer MRO

Compliance Audit Specialist MRO

Compliance Audit Specialist MRO

CIP Audit Specialist MRO

CIP Audit Specialist MRO

CIP Audit Specialist MRO

Registered Entity Participants and Observers

Title Entity

Manager Reliability Standards Compliance MPW

Director Legal amp Regulatory Services MPW

Director Employee and Customer Relations MPW

Control Center Supervisor and Trainer MPW

System Operator II MPW

System Operator II MPW

Manager Control Center MPW

SCADA System Administrator MPW

SCADA Specialist MPW

Summer Intern MPW

Planning Engineer MPW

Manager Transmission and Distribution MPW

System Maintenance Specialist II MPW

General Manager MPW

Manager Telecommunications MPW

Administrative Assistant MPW

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 10

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Title Entity

System Specialist MPW

Generation Technical Supervisor MPW

Director Power Production and Supply MPW

Director Utility Service Delivery MPW

System Operator II MPW

Assistant Generation Operations Supervisor MPW

Communications Chief Technician MPW

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 9

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Appendix I

MRO Audit Staff

Title Entity

Audit Team Lead Compliance Engineer MRO

Senior Compliance Engineer MRO

Compliance Audit Specialist MRO

Compliance Audit Specialist MRO

CIP Audit Specialist MRO

CIP Audit Specialist MRO

CIP Audit Specialist MRO

Registered Entity Participants and Observers

Title Entity

Manager Reliability Standards Compliance MPW

Director Legal amp Regulatory Services MPW

Director Employee and Customer Relations MPW

Control Center Supervisor and Trainer MPW

System Operator II MPW

System Operator II MPW

Manager Control Center MPW

SCADA System Administrator MPW

SCADA Specialist MPW

Summer Intern MPW

Planning Engineer MPW

Manager Transmission and Distribution MPW

System Maintenance Specialist II MPW

General Manager MPW

Manager Telecommunications MPW

Administrative Assistant MPW

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 10

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Title Entity

System Specialist MPW

Generation Technical Supervisor MPW

Director Power Production and Supply MPW

Director Utility Service Delivery MPW

System Operator II MPW

Assistant Generation Operations Supervisor MPW

Communications Chief Technician MPW

Does Not Contain Confidential and Non-Public Information

(Privileged and Critical Energy Infrastructure Information Removed)

Muscatine Power amp Water P a g e | 10

Report Date June 21 2013

MIDWEST RELIABILITY

ORGANIZATION

Title Entity

System Specialist MPW

Generation Technical Supervisor MPW

Director Power Production and Supply MPW

Director Utility Service Delivery MPW

System Operator II MPW

Assistant Generation Operations Supervisor MPW

Communications Chief Technician MPW