Power Generation, Transmission, and Use

Markets, Regulation, and Oversight

Impacts of Power Generation and Transmission

Looking Ahead


CEIR Report Map


Maryland Power Plants and the Environment (CEIR-18)

3.3.1 Reliability

The North American Electric Reliability Corporation (NERC) is charged with developing and implementing reliability standards and periodically assessing the reliability of the bulk power system. NERC, which is governed by a 12-member independent board of trustees, develops mandatory reliability standards that are reviewed and ultimately approved by the FERC. The Energy Policy Act of 2005 requires electricity market participants to comply with NERC reliability standards, or be subject to fines of up to $1 million per day per violation. NERC delegates enforcement authority to eight regional reliability councils, including the ReliabilityFirst Corporation (RF) that serves the PJM RTO (see Figure 3-5).

Figure 3-5 NERC Reliability Councils

Figure 3-5

Source: North American Energy Reliability Corporation.

One of the NERC reliability standards applicable to PJM is the Resource Planning Reserve Requirement. This standard requires that each load serving entity (LSE) participating in PJM have sufficient resources such that there is no loss of load more than one day in ten years. In order to maintain compliance under this reliability standard, PJM conducts annual resource planning exercises to ensure all LSEs have sufficient generation resources (either owned or contracted) to supply their peak electricity load, plus a specified annual reserve margin of approximately 15 percent.