FERC Standards of Conduct Training April 2016
Overview FERC Standards of Conduct (Standards) govern interactions between AECC s transmission function employees and its market function employees. The Standards are intended to ensure that transmission providers do not give their affiliates a competitive advantage Through preferential treatment By providing access to information denied to non-aecc employees or other entities The Standards impose the following rules and requirements: Non-Discrimination Requirements Independent Functioning Rule No Conduit Rule Transparency Rule
Employee Classifications The Standards are built on three distinct employee classifications: Transmission Function Employees or TFEs, Marketing Function Employees or MFEs, and No Conduit Employees. Classifications are assigned based on individual job responsibilities, not the organizational structure of the company. *The term Employee includes contractors.
What is a Transmission Function Employee? A Transmission Function Employee, or TFE, is an employee, contractor, consultant, or agent of a Transmission Provider who actively and personally engages on a day-to-day basis in Transmission Functions. Transmission Functions are the planning, directing, organizing, or carrying out of day-to-day transmission operations, including: o System control o Planning/performance of transmission maintenance
What are Marketing Function Employees? The Marketing Function Employees, or MFEs, are those persons who actively and personally engage on a day-to-day basis in Marketing Functions. Marketing Functions include the market or bilateral sale for resale in interstate commerce, or the submission of offers to sell in the markets, of o electric energy or capacity, o demand response, o virtual transactions, o or financial or physical transmission rights.
No Conduit Employees No Conduit Employees are employees, contractors, consultants or agents not classified as transmission function or marketing function employees, but are likely to become privy to transmission function information.
What is Non-Public Transmission Function Information? The FERC Standards of Conduct are designed to prevent the inappropriate sharing of Non-Public Transmission Function Information Non-Public Transmission Function Information means transmission information not posted on OASIS or otherwise publically available.
Examples of Non-Public Transmission Function Information Information about the transmission system (preliminary design and expansion plans such as new construction and system upgrades); Information about transmission operations and system conditions that have not yet been posted on OASIS (transmission outages both planned and unplanned; system maintenance activity); Critical Energy Infrastructure Information (CEII) (detailed system diagrams and non-public maps); Information about a customer (unless customer signs a voluntary customer consent); and Any other information deemed sensitive by FERC (certain economic or financial information) *Any Transmission-Function Information that is not posted on OASIS is non-public information.
General Requirements of the Standards of Conduct 1. Independent Functioning Rule: AECC s TFEs must operate independently from MFEs. 2. No Conduit Rule: MFEs cannot have access to prohibited information, including through employees who do not work for the AECC. 3. Non-Discrimination: AECC must treat all transmission customers on a non-discriminatory basis. 4. Transparency: AECC must ensure certain information is posted on OASIS. 5. Other: AECC must develop and distribute written procedures to ensure compliance with the Standards of Conduct; AECC must train new and existing employees on the requirements of the Standards of Conduct; and AECC must designate a single company contact in charge of overall compliance with the Standards of Conduct.
Non-Discrimination In any transaction related to transmission service, AECC must: Strictly enforce all tariff provisions relating to the purchase of OATS, if the tariff provisions do not permit the use of discretion Apply all tariff provisions relating to the purchase of OATS in a fair, impartial, and not unduly discriminatory manner, if the tariff provisions permit the use of discretion Not, through its tariffs or otherwise, grant an undue preference to any person in matters relating to the sale or purchase of transmission service
Independent Functioning Rule AECC must ensure its TFEs and MFEs operate independently of each other. MFEs are prohibited from: Conducting transmission functions; and Having access to the transmission system control center or similar facilities used for transmission operations that differs in any way from the access available to other transmission customers *Supervisors are not MFEs unless they actively engage in marketing functions. TFEs are prohibited from conducting marketing functions, which include selling or offering to sell Electric energy or capacity; Demand response; Virtual transactions; or Financial or physical transmission rights.
Independent Functioning Guidelines If you are an MFE, never attempt to gain access to transmission facilities, systems or transmission-function information. If you are a TFE, never attempt to gain access to marketing facilities, records or computer systems. If you receive restricted information in error, do not use it and immediately report it to your supervisor. If you divulge any restricted information in error, report it immediately to your supervisor.
No Conduit Rule AECC cannot use anyone as a conduit to transmit non-public transmission function information to an MFE. AECC is prohibited from the following: Using anyone as a conduit for disclosure of non-public transmission function information to its MFEs. Allowing an employee, contractor, consultant or agent of AECC, or one of its affiliates that is engaged in marketing functions, to disclose non-public transmission function information to any of AECC s MFEs.
Transparency Rule AECC is required to provide equal access to nonpublic transmission function information (NPTFI) disclosed to MFEs. If AECC discloses NPTFI in a manner contrary to the requirements of the No Conduit Rule, AECC must immediately post to its OASIS the information disclosed. If AECC discloses, in a manner contrary to the No Conduit Rule, any NPTFI, critical infrastructure information, or any other information that FERC by law has determined is subject to limited dissemination, AECC must immediately post notice of the disclosure to its OASIS.
Transparency cont. The transparency rule also requires AECC to post: 1. The job titles and descriptions of all of its TFEs; 2. A list of any facilities shared by TFEs and MFEs; 3. Names and addresses of affiliates of AECC that employ or retain MFEs; and 4. AECC s written procedures related to the Standards 5. The transfer of any employee, contractor, consultant or agent who moves from a position involving transmission functions to one involving marketing functions.
Transparency cont. Timing and general requirements of postings: All website postings required must be sufficiently prominent as to be readily accessible. AECC must update on its website the information required by the regulations within seven (7) business days of any change, and post the date on which the information was updated. In the event of an emergency, such as an earthquake, flood, fire or tornado that severely disrupts a AECC s normal business operations, the posting requirements may be suspended by AECC. If the disruption lasts longer than one month, AECC must notify the Commission and may seek a further exemption from the posting requirements.
Transparency cont. There are limited exceptions to the Independent Functioning and No Conduit Rules. TFEs may share non-public transmission-function information with a MFE if it is 1. Necessary either to (a) perform generation dispatch or (b) maintain or restore operation of the transmission system or generating units; or 2. Furnished to comply with FERC reliability standards. Whenever a TFE shares information with an MFE under (1) or (2) above, AECC must make a contemporaneous record of any information exchanged except in an emergency, in which case AECC must make a record of information shared as soon as practicable after the fact.
Transparency cont. Exclusion for and recording of certain information exchanges: AECC s TFEs and MFEs may exchange certain non-public transmission function information as permitted in the regulations, in which case AECC must make and retain an immediate record of all such exchanges except in emergency circumstances. AECC shall make the record available to the Commission upon request. The record may consist of handwritten or typed notes, electronic records such as emails and text messages, recorded telephone exchanges, and the like and must be retained for a period of five years.
Implementation Requirements AECC must implement measures to ensure that the requirements of the no conduit rule and the transparency rule are observed by its employees and by the employees of its affiliates. AECC must distribute written procedures of the posting requirements and provide annual training on the standards of conduct to all its TFEs, MFEs, officers, directors, supervisory employees, and any other employees likely to become privy to transmission function information. AECC must provide training on the standards of conduct to new employees in the categories listed above, within the first 30 days of their employment.
Questions about interpretation or application of the Standards of Conduct policy and procedure should be directed to AECC s Chief Compliance Officer: Lori L. Burrows Vice President and General Counsel (501) 570-2147 lori.burrows@aecc.com