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Federal Energy Regulatory Commission

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News Release: November 28, 2014
Docket No. IN14-10-000

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FERC Approves Fifth Settlement in 2011 Southwest Blackout Case

The Federal Energy Regulatory Commission (FERC) has approved a stipulation and consent agreement among FERC’s Office of Enforcement, the North American Electric Reliability Corporation (NERC), and the California Independent System Operator (CAISO) that includes a $6 million civil penalty and resolves the investigation by FERC Enforcement staff and NERC into CAISO’s involvement in the Sept. 8, 2011, Southwest blackout.

This marks the fifth settlement related to the FERC-NERC joint investigation into the outage that left more than 5 million people in Southern California, Arizona and Baja California, Mexico, without power for up to 12 hours.

Enforcement staff and NERC determined that CAISO violated three requirements of the Transmission Operations (TOP) and the Facilities Design, Connection and Maintenance (FAC) groups of Reliability Standards. The TOP standards cover the responsibilities and decision-making authority for reliable operations and aim to ensure that the transmission system is operated within correct operating limits. The FAC standard involved aims to ensure that system operating limits are based on an established methodology.

Enforcement staff and NERC concluded that CAISO had failed to appropriately monitor the current flow on Path 44, or otherwise take corrective action to avert operation of the intertie separation scheme at the San Onofre nuclear generating plant switchyard. Initiation of the intertie separate scheme contributed to tripping the San Onofre nuclear generating plant offline, and eventually resulted in the complete blackout of San Diego and the Baja California control area operated by Comisión Federal de Electricidad.

CAISO stipulated to the facts in the agreement and agreed to pay the $6 million civil penalty– of which $2 million will be split evenly between the U.S. Treasury and NERC, and $4 million will be invested in reliability enhancement measures that go above and beyond mitigation of the violations and the requirements of the Reliability Standards. CAISO also agreed to mitigation measures and to submit to compliance monitoring. CAISO neither admits nor denies that its actions constituted violations of the Reliability Standards.