SERC Reliability’s settlement with Mississippi’s Cooperative Energy for violations of NERC’s reliability standards will not carry a monetary penalty, according to the agreement approved by FERC on Wednesday (NP23-19).

The commission said in a filing that it will not further review the settlement, leaving the agreement intact.

NERC submitted the settlement between SERC and Cooperative on July 31 in its monthly Notice of Penalty spreadsheet; it was the only settlement made public this month, although NERC filed a separate NOP concerning violations of the Critical Infrastructure Protection (CIP) standards. That filing was not publicly accessible, in keeping with NERC’s policy that publishing information on CIP violations could be helpful to malicious actors.

Headquartered in Hattiesburg, Miss., Cooperative served nearly 450,000 homes and businesses as of the end of 2022 across 55 of the state’s 82 counties. The utility’s 11 member cooperatives operate 1,838 miles of transmission lines and 58,348 miles of distribution lines, and own generating assets with a total combined capacity of nearly 2.5 GW.

Cooperative’s settlement with SERC stems from a violation of FAC-008-3 (Facility ratings) and its predecessor FAC-009-1 (Establish and communicate facility ratings). SERC discovered the infringement in 2021, when FAC-008-3 was in effect (the standard was replaced later that year by FAC-008-5 ), but it later determined that the noncompliance began in 2007 when the earlier standard became enforceable.

While reviewing evidence submitted during a data request for an off-site compliance audit, SERC’s audit team discovered that Cooperative had failed to consider current transformers when determining facility ratings for its solely and jointly owned facilities. This constituted a violation of requirement R6 in FAC-008-3, which requires transmission owners and generation owners to have facility ratings that are consistent with the associated facility ratings methodologies.

The regional entity specifically noted that the rating for a 230-kV line “was inaccurate once the [current transformer] was considered” and, to be consistent with the requirement, should have been lowered to account for the limiting component.

After the discovery, Cooperative performed an extent-of-condition assessment that included print reviews or walkdowns of similar facilities to see if their ratings considered current transformers. The assessment covered 53 facilities, of which the utility determined that 27 did not include current transformers in their ratings. Seventeen of the affected facilities had to be derated, and SERC determined that three had at some point in their history experienced a load in excess of the newly calculated facility ratings.

The RE attributed the noncompliance to a lack of internal controls, such as a checklist or other measure to ensure all equipment documented in the ratings methodology was included in the development of facility ratings. SERC said the violation posed a moderate risk, despite the documented exceedances; the RE noted that in all three incidents the exceedance was less than 20% of the revised facility ratings and no harm is known to have occurred.

Cooperative’s mitigation actions included updating its system information database to include data on current transformers for updating facility ratings, performing field work on high-priority facilities to eliminate limitations related to current transformers and implementing a checklist for the facility ratings process that will provide “better visibility for required facilities data … and [prevent] recurrence.” According to the settlement, the mitigation was verified to be complete on April 26, 2022.

SERC awarded the utility penalty credit for its high level of cooperation throughout the enforcement process; Cooperative provided “detailed and organized information” to the RE and “openly shared information” about its internal compliance program and organizational structure, even where that meant exposing potential weaknesses. Cooperative received additional credit for agreeing to settle the violation.