Topic:"Budgets And Targets" in M03324

ARTICLE VIII Member Representatives Committee Section 1 ¾ Member Representatives Committee The Corporation shall have a Member Representatives Committee that shall have the following rights and obligations: - a. to elect the independent tr...

AI summary The Member Representatives Committee (MRC) is established to elect independent trustees, vote on bylaw amendments, and advise the board on budgets and business plans. It consists of sector representatives with specific voting rights and term structures, ensuring balanced representation and avoiding board overlap.

ARTICLE XIII Budgets and Funding

AI summary The document section titled 'ARTICLE XIII Budgets and Funding' is introduced but contains no substantive content or analysis regarding budgetary processes, funding mechanisms, or related regulatory considerations.

Section 2 ¾ Preparation and Adoption of Annual Budget, Business Plan, and Funding Mechanism ¾ The board shall prepare or cause to be prepared an annual budget for the administrative and other expenses of the Corporation, including the expe...

AI summary The board is required to prepare and approve an annual budget, business plan, and funding mechanism for the Corporation, including reserves and special projects. These documents must be approved at least 135 days before the fiscal year begins to ensure timely submission to governmental authorities.

e Regional Entity shall be limited to examination of the Regional Entity's compliance with the Delegation Agreement, the NERC ROP, the CMEP, FERC requirements, and directives issued pursuant to §8(c). Section 9, Funding. This section has b...

AI summary The Funding section of the Delegation Agreement mandates that the Regional Entity collaborate with NERC to develop an annual budget, ensuring delegated functions have adequate resources. Funding sources include end-user assessments and penalties, with allocation based on Net Energy for Load (NEL) or an approved alternative formula. FERC approval is required for funding arrangements.

f. Exhibit E to the Delegation Agreement Exhibit E, Funding, has been considerably expanded in the revised pro forma Delegation Agreement, and some provisions have been moved to Exhibit E from the body of the Delegation Agreement. In Secti...

AI summary Exhibit E to the Delegation Agreement has been expanded, detailing funded activities such as Event Analysis and Reliability Improvement, while removing Reliability Readiness Evaluation and Improvement. Budgeting provisions for the Regional Entity's business plan and reserve mechanisms are emphasized, with NERC ROP references omitted for budgeting purposes.

l be bound by the antitrust guidelines, code of conduct, conflict of interest, confidentiality and any other applicable polices as referenced in the NERC Compliance Monitoring and Enforcement Program. The deletion of this provision address...

AI summary The revised NPCC Delegation Agreement removes provisions related to technical committee consultations during compliance enforcement, complying with FERC's 2008 directive. It also details budgetary mechanisms to separate funding for NPCC's statutory and non-statutory activities, aligning with existing requirements in the current agreement.

6. Amendments to Section 1100 – Annual NERC Business Plans and Budgets The amendments to §1100 are intended to be consistent with the expanded provisions in §9 and Exhibit E of the revised pro forma Delegation Agreement on the annual NERC...

AI summary Amendments to Section 1100 align with revised Delegation Agreement provisions, removing the March start date for NERC's annual budget process to allow flexibility in scheduling, ensuring timely FERC submission. Section 1103.3 is updated to include information based on past budget experiences from 2007 to 2010.

he Regions, and the proposed assessments to the load-serving entities (LSE) within each Region to collect the allocated statutory funding requirements. This filing includes the following attachments: Attachment 1: Summary tables showing NE...

AI summary The filing outlines NERC's 2010 budget and funding requirements, along with proposals from regional reliability organizations, including detailed attachments on statutory funding, business plans, and goal achievement reports. It emphasizes allocation of statutory funding to load-serving entities and regional entities' operational metrics.

BEFORE THE NOVA SCOTIA UTILITIES AND REVIEW BOARD THE PROVINCE OF NOVA SCOTIA NORTH AMERICAN ELECTRIC ) RELIABILITY CORPORATION ) NOTICE OF FILING OF THE NORTH AMERICAN ELECTRIC RELIABILITY CORPORATION OF ITS 2010 BUSINESS PLAN AND BUDGET...

AI summary The document is a Notice of Filing submitted by the North American Electric Reliability Corporation (NERC) regarding its 2010 Business Plan and Budget, as well as the 2010 Business Plans and Budgets of Regional Entities and proposed assessments to fund these budgets.

f each Regional Entity, (iii) the budget for Section 215(j) activities requested by WIRAB, and (iv) the aggregate ERO funding requirement of NERC, the Regional Entities and WIRAB, allocated to Canada. Attachment 2 contains NERC's detailed...

AI summary The document outlines attachments related to NERC and Regional Entities' 2010 budgets, compliance programs, financial statements, and FERC orders. Attachments detail business plans, budget allocations, audit reports, and adjustments to NERC assessments, including a reference to FERC's Order in Docket No. RR07-16-003.

III. OVERVIEW OF PROPOSED BUDGETS AND FUNDING REQUIREMENTS

AI summary This section introduces the proposed budgets and funding requirements for the regulatory proceeding, though no detailed information is provided in the text. It serves as an introduction to financial planning aspects under consideration.

A. NERC's Proposed Business Plan, Budget and Funding Requirement

AI summary The document section outlines NERC's proposed business plan, budget, and funding requirements, focusing on operational and financial strategies for the North American Electric Reliability Corporation. It likely includes details on resource allocation, cost structures, and funding mechanisms necessary for reliability coordination across the U.S. and Canada.

supports the statutory activities of development of reliability standards and achieving compliance with reliability standards, and includes NERC's metrics, benchmarking and event analysis activities. (5) The Situation Awareness and Infrast...

AI summary The text outlines NERC's 2010 Business Plan and Budget, emphasizing compliance with reliability standards, infrastructure security, and funding distribution. It highlights the Situation Awareness and Infrastructure Security Program's role in reliability enforcement and critical infrastructure protection (CIP), alongside the need for additional staffing and resources to improve operational efficiency and reliability initiatives.

2. Development of NERC's 2010 Business Plan and Budget NERC prepared its 2010 Business Plan and Budget (and worked with the Regional Entities in the development of their business plans and budgets) through a rigorous process that provided...

AI summary NERC developed its 2010 Business Plan and Budget through a rigorous process involving stakeholder input and coordination with Regional Entities. The Finance and Audit Committee of the NERC Board approved the timeline in February 2009, with budget assumptions discussed in March 2009 meetings.

3. Summary of NERC's Proposed 2010 Budget and Funding Requirement NERC's proposed 2010 Budget is $40,088,365. This total encompasses U.S., Canadian and Mexican activities. The proposed 2010 Budget represents an increase of $4,082,137 (11.3...

AI summary NERC's 2010 budget totals $40,088,365, reflecting an 11.3% increase over 2009. It includes $39.6M in expenses, $1.2M in capital expenditures, and a $469K working capital reserve. Funding sources include program fees, software sales, interest, and payments from regional entities, with a net $37M funding requirement from LSE assessments.

22 The NEL data for the U.S., Canada and Mexico, by Region, is provided in summary format on Table 6 of Section B of Attachment 2 . 23 Although the budget as submitted to FERC included revenues and expenses associated with the Transmission...

AI summary The text discusses the NERC budget for 2010, noting that the Forum's administrative relationship with NERC has terminated, and that interest income offsets part of the administrative expenses. It refers to Attachment 2 for detailed program descriptions and budget allocations.

B. Regional Entity Proposed 2010 Budgets The individual Regional Entity Business Plans and Budgets are provided in Attachments 3 through 10 . The Regional Entity budgets for statutory activities that are to be funded through NERC are the b...

AI summary The document outlines the 2010 budgets for Regional Entities, funded by NERC, covering reliability standards, compliance monitoring, training, and infrastructure security. It notes that NERC’s 2010 plan excludes non-statutory activities, with funding from FPA §215 dedicated solely to statutory functions. Administrative costs for Regional Entities are also budgeted to meet delegation agreement obligations.

E. Treatment of Prior Years' Budget Surpluses or Deficits/Working Capital Reserve In the 2008 Budget Order, FERC approved NERC's proposal to authorize a one-year suspension of NERC's policy of taking account of anticipated year-end budget...

AI summary FERC approved NERC's 2008 proposal to use 2007 surpluses as reserves for 2008 costs related to enforcing reliability standards. Subsequent years (2009-2010) adjusted assessments based on accumulated surpluses/deficits to meet targeted working capital reserves. This process involved balancing budgets against statutory duties and reliability compliance requirements.

A. 2010 Business Plans and Budgets by Program This section summarizes NERC's proposed 2010 Business Plan and Budget by statutory program and Administrative Services department. 55 As noted earlier, a number of changes in accounting methodo...

AI summary NERC's 2010 Business Plan and Budget introduced four key accounting changes: direct/indirect cost allocation, FTE-based Administrative Services expense distribution, capital expenditures as fixed assets, and depreciation treatment. These changes may distort year-over-year budget comparisons for statutory programs.

1. Reliability Standards Program The Reliability Standards Program develops and maintains standards designed to ensure the reliability of the bulk power system in North America. The stakeholder Standards Committee provides oversight to the...

AI summary The Reliability Standards Program under NERC ensures bulk power system reliability through standards development, overseen by the Standards Committee. The 2010 budget includes increased FTEs and expenses for personnel, meetings, and consultants, with a focus on CIP standards and system initiatives.

The CMEP budget 57 The current inflow of newly-identified alleged violations averages 85 per month after dismissals of possible violations that are determined not to be alleged violations. also includes NERC's expenses for performing the c...

AI summary The 2010 CMEP budget increased by $2.03 million from 2009, with 45.75 FTEs allocated to compliance monitoring and enforcement. NERC will be reimbursed by Regional Entities for reliability functions, and $1.1 million is budgeted for consultants. Additional FTEs support backlog reduction, mitigation plan approvals, and compliance investigations.

as Funding in the budget. Detailed 2010 assumptions, goals and objectives for the Reliability Assessment and Performance Analysis Program are provided at pages 31-35 in Section A of Attachment 2 . NERC's budgeted direct expense for the Rel...

AI summary The 2010 budget for NERC's Reliability Assessment and Performance Analysis Program increased by $628,963 (14.7%) from 2009, with 16 FTEs. Additional funds support travel, consultants, and initiatives like climate change impact studies, system protection, and TADS/GADS development.

provement of and promote quality in the training programs used and implemented by owners, operators and users of the bulk power system. Through the CEP, NERC approves or accredits training programs of owners, operators and users of the bul...

AI summary The document outlines NERC's Continuing Education Program (CEP), which approves training for bulk power system stakeholders and ensures compliance through audits. It details a 2010 budget increase of $356,747 and 1.25 additional FTEs for the Training, Education, and Personnel Certification Program, emphasizing NERC's role in maintaining training standards and resource allocation.

reparedness Assessments). Detailed 2010 assumptions, goals and objectives for the Situation Awareness and Infrastructure Security Program are provided at pages 43-46 in Section A of Attachment 2. The budgeted direct expense for 2010 for th...

AI summary The 2010 budget for the Situation Awareness and Infrastructure Security Program increased by $1.59 million and 2.75 FTEs, with funds allocated to enhance NERC's ES-ISAC responsibilities and improve situational awareness. The NASPI initiative, focused on phasor measurement technology for grid visibility, is highlighted as a key component of infrastructure planning and system reliability efforts.

6. Administrative Services The Administrative Services departments support the other NERC programs. Administrative Services comprises the following functions: (i) Technical Committees and Members' Forums; (ii) General and Administrative; (...

AI summary Administrative Services supports NERC programs through functions like Technical Committees, Legal/Regulatory, and Finance. The 2010 budget for Technical Committees and Forums is $1.6M, fully funded by forum dues, with no impact on LSE assessments. This includes a $300K reimbursement from the Transmission Owners and Operators Forum to NERC.

V. REGIONAL ENTITY BUSINESS PLANS AND BUDGETS

AI summary The section titled 'V. REGIONAL ENTITY BUSINESS PLANS AND BUDGETS' outlines the focus on financial planning and budgeting processes for regional entities within the regulatory proceeding. However, the provided text contains no substantive content or specific details about the plans or budgets discussed.

A. Consistency Among Regional Entity Budgets In developing the 2010 Regional Entity Business Plans and Budgets, NERC and the Regional Entities worked to build on the substantial efforts they devoted to achieving consistency of format and p...

AI summary NERC and Regional Entities worked to improve consistency in 2010 Business Plans and Budgets through collaborative accounting changes, common budget assumptions, and standardized administrative cost definitions. They note significant improvements since 2007 but emphasize consistency as an ongoing process.

B. Discussion of Individual Regional Entity Business Plans and Budgets This section discusses highlights of the individual Regional Entity Business Plans and Budgets.

AI summary This section outlines key highlights from the individual Regional Entity Business Plans and Budgets, providing an overview of their financial and operational strategies.

1. FRCC FRCC's total statutory budget for 2010 is $5,421,187, an increase of $1,443,319 from its 2009 Budget; $1,041,334 of this increase is in Personnel Expense. FRCC plans total staffing for statutory and administrative programs of 22.67...

AI summary FRCC's 2010 statutory budget increased by $1.44M, driven by $1.04M in personnel costs and 4.33 additional FTEs. The Working Capital Reserve is projected at $892,708, exceeding the 10% target, reducing the requested assessment by $350,589. Non-statutory activities budgeted $4.21M. CMEP receives 3.31 extra FTEs, while TFE processing relies on reserves.

2. MRO MRO's total statutory budget for 2010 is $7,366,117, an increase of $960,393 over its 2009 Budget. 76 MRO plans total staffing for statutory and administrative programs of 29.0 FTEs, an increase of 2.5 FTEs over its 2009 Budget. MRO...

AI summary The MRO's 2010 statutory budget increased by $960,393 to $7,366,117, with staffing rising to 29.0 FTEs. Key programs like CMEP and Organization Registration and Certification saw significant budget and FTE increases. A Working Capital Reserve target of $286,972 was set, requiring a $212,628 budget increment. Footnotes reference a 2009 supplemental budget request and a table in Attachment 4.

3. NPCC NPCC's statutory budget for 2010 is $11,354,085, an increase of $1,345,200 over its 2009 Budget. NPCC plans total staffing for statutory and administrative programs of 27.41 FTEs, an increase of 4.01 FTEs over its 2009 Budget. 78 N...

AI summary NPCC's 2010 statutory budget increased by $1.35M (12.8%) to $11.35M, reflecting a 14.7% rise in FTEs (from 23.4 to 27.41) to support expanded compliance activities, including CIP standard audits, compliance violation investigations, and registry maintenance. Consultant/contract resources for compliance programs also increased significantly.

4. Reliability First Reliability First has a total statutory budget for 2010 of $14,184,713, an increase of $2,750,512 over its 2009 Budget. However, Reliability First 's requested assessments, which were significantly reduced in its 2009...

AI summary Reliability First seeks a 2010 statutory budget increase of $2.75M over 2009, driven by higher assessments and staffing needs. Budget reflects $14.3M in requested assessments, increased FTEs for compliance programs, and a target Working Capital Reserve of $1.4M. Non-statutory activities are excluded.

5. SERC SERC's total statutory budget for 2010 is $10,701,683, an increase of $606,137 over its 2009 Budget. SERC plans total staffing for statutory and administrative programs of 45.5 FTEs, an increase of 2.5 FTEs over its 2009 Budget. SE...

AI summary SERC's 2010 budget increased by $606,137, with major allocations to infrastructure security and administrative services. Staffing rose to 45.5 FTEs, and the Working Capital Reserve target is $1,009,555. SERC will handle TFE processing with existing resources and may request supplemental funding if needed. No non-statutory activities are planned.

6. SPP RE SPP RE's total 2010 statutory budget is $8,138,783, an increase of $1,657,747 over its 2009 Budget. SPP RE plans total staffing for statutory and administrative programs of 24.3 FTEs, an increase of 7.1 FTEs over its 2009 Budget....

AI summary SPP RE's 2010 statutory budget increased by $1.66M, with 7.1 additional FTEs, focusing on CMEP and compliance programs. Budget highlights include a 156% rise in direct expenses for CMEP, reduced indirect expense rates, and a $1.38M reduction in the requested 2010 assessment due to projected working capital reserves. FERC's 2009 order on budget procedures is referenced.

7. Texas RE Texas RE's total 2010 statutory budget is $6,920,641, an increase of $753,615 over its 2009 Budget. Texas RE plans total staffing for statutory and administrative programs of 34 FTEs, an increase of 7.05 FTEs over its 2009 Budg...

AI summary Texas RE's 2010 statutory budget increased by $753,615 to $6,920,641, with 34 FTEs allocated for statutory programs. Key increases include CMEP funding ($1,837,055) and 7.59 additional FTEs for compliance activities, including TFE database management. Professional services costs rose by $428,660 due to external legal expenses.

8. WECC WECC's 2010 total statutory budget is $39,508,558, an increase of $1,816,790 over its 2009 Budget. WECC plans total staffing for statutory and administrative programs of 172.5 FTEs, an increase of 32.5 FTEs over its 2009 Budget. Of...

AI summary WECC's 2010 budget increased by $1.8 million, with 32.5 additional FTEs, focusing on compliance programs like CMEP and Organization Registration. Resources for TFE processing rely on existing staff and reserves, with potential supplemental funding needed later in 2010.

C. Metrics Related to Regional Entity Budgets In its 2008 and 2009 Business Plan and Budget filings, NERC included attachments providing metrics developed by NERC and the Regional Entities to be used as a further aid to understanding where...

AI summary NERC submitted budget metrics for Regional Entities in 2008 and 2009, which FERC reviewed and requested improvements, particularly standardized audit terminology. NERC revised its filings, and FERC accepted the changes in 2009. The discussion focuses on enhancing budget transparency and compliance with regulatory standards.

VI. NERC AND REGIONAL ENTITY AUDITED FINANCIAL STATEMENTS FOR 2008, AND ADDITIONAL RECONCILIATION OF 2008 BUDGETED VERSUS ACTUAL EXPENSES FOR TEXAS RE BASED ON ITS AUDITED 2008 FINANCIAL STATEMENTS Section 1105.1 of the NERC Rules of Proce...

AI summary The document outlines NERC's requirement to file audited financial statements for 2008 and regional entities, as mandated by Section 1105.1 of NERC Rules. It references FERC's 2008 Budget Order directing NERC to reconcile annual budgets with actual expenses, with Attachment 17 containing the required financial statements and auditor reports.

or settlements) covering a total of 171 violations of requirements of reliability standards. A total of $833,000 in penalties has been assessed to 10 registered entities for violations of standards. The compliance program also includes pro...

AI summary The text outlines NERC and Regional Entities' compliance program, noting 171 violations with $833,000 in penalties, use of Remedial Action Directives in five cases, and significant budget allocation ($32.5M) for compliance monitoring and enforcement. The program aims to ensure adherence to reliability standards through penalties, directives, and resource dedication.

B. NERC and the Regional Entities Have Developed Effective Business Planning and Budgeting, Accounting and Financial Reporting, and Assessment Processes NERC and the Regional Entities have developed a comprehensive process for developing t...

AI summary NERC and Regional Entities maintain consistent annual business planning and budgeting processes, submitting plans to FERC for approval. These processes, evolved since 2006, enable comparison of budgets to prior years and actual results, with member input opportunities. The formats facilitate transparency across entities and statutory program areas.

In P 177, FERC stated: "Further, any communication between an event analysis team and a corresponding CVI team generally should be one-way only: from the event analysis team to the CVI team. This one-way information sharing will avoid the...

AI summary FERC mandates one-way communication from event analysis teams to CVI teams to prevent disclosure of confidential compliance information. It also directs NERC to clarify event analysis-compliance interfaces, report on staff reorganization impacts, and address staffing adequacy for expanded duties. NERC must detail procedures for information exchange and budget adjustments if needed.

6. Business Planning and Budgeting, Accounting and Financial Reporting and Assessment Processes In its September 16, 2010 Order, P 194, FERC stated: "Noting that NERC already engages in strategic planning out to five years, the Commission...

AI summary FERC's 2010 Order P 194 encourages joint strategic planning between NERC and Regional Entities under ERO oversight to improve reliability operations and reduce budget process tensions, emphasizing the value of multi-year budgets for stakeholder transparency.

Further, in P 195, FERC stated: "A joint strategic planning initiative also would address another major Commission concern, which is adequate monitoring of the Regional Entities' expenditures. The Commission notes that in NERC's compliance...

AI summary FERC emphasizes the need for NERC to improve oversight of Regional Entities' budgets, citing past reliance on internal estimates and the requirement for ERO to review expenditures. A joint strategic planning initiative with multi-year budgets is proposed to ensure adequate funding for Regional Entities' delegated functions.

NERC Response to FERC's Directive – P 195 In its 2011 Business Plan and Budget, NERC provided a preliminary projection of anticipated resource requirements and expenditures for calendar years 2011-2013. Unlike in past years where the proje...

AI summary NERC's 2011 Business Plan and Budget includes projections for 2011-2013, incorporating staffing increases, headquarters relocation costs, and collaboration with eight Regional Entities. Strategic planning sessions produced draft Strategic Goals for 2011-2015, discussed in February 2011 meetings.

7. Amend the budget templates. NERC, working in collaboration with the Regional Entities, has amended its budget templates. - 8. Apply standard language for reliability standards development and compliance in NERC and Regional Entity busin...

AI summary NERC has amended budget templates in collaboration with Regional Entities and established common goals, objectives, and assumptions for annual business plans and budgets, as applied in the 2010 and 2011 cycles.

9. Change the timing of the budget process. The schedule for the preparation of the annual business plan and budget process is posted annually, with minor improvements each year as deemed necessary. Extensive changes to the timing of the b...

AI summary The annual budget process timing is constrained by regulatory requirements mandating submission to the Commission by August 22. Minor adjustments are permitted annually, but extensive changes are not feasible due to this deadline, as outlined in 18 C.F.R. §39.4(b).

12. Consider a "shared reserve" among Regional Entities and NERC. a. Continue discussion with Regional Entities concerning this concept as future budgets are developed. The concept of "shared reserve" among Regional Entities and NERC has b...

AI summary The proposal for a 'shared reserve' among Regional Entities and NERC was discussed but failed to reach consensus. Alternatives like individual cash reserves, lines of credit, and budget amendments were considered for funding unanticipated costs. Further dialogue with Regional Entities is recommended as budgets develop.

13. Standardize language and expectations on components of indirect costs. a. In conjunction with the Regional Entities, complete development of a common definition of, and procedures for recording and budgeting, indirect costs. Standard d...

AI summary The document outlines the standardization of indirect cost definitions and procedures, adopted since 2009 and refined in 2011 through amended Regional Delegation Agreements. These agreements, specifically Sections 9(a), (d), (g), (j), and Exhibit E Sections 2 and 5, ensure consistency in business planning and budgeting across Regional Entities. No further changes to the agreements are required.

14. Implement a uniform budgeting tool. a. Discuss concept with the REBG to evaluate if there is consensus to pursue development of such a tool. Common templates have been developed and are used by NERC and the Regional Entities for budget...

AI summary The proposal to develop a uniform budgeting tool requires consensus with the REBG. While common templates are used by NERC and Regional Entities, no further tool development has occurred beyond template sharing.

15. Adopt uniform budget metrics. a. Continue efforts in the 2010 budget cycle. NERC and the Regions will continue to provide budget metrics in their annual Business Plans and Budgets. The budget metrics are reviewed in connection with eac...

AI summary The document outlines continuing efforts in the 2010 budget cycle, with NERC and the Regions providing annual budget metrics for review. These metrics are assessed annually to determine elimination, modification, or addition of new metrics.