On May 17, 2018, FERC issued Order No. 833-A wherein it denied rehearing of Order No. 833 and granted, in part, Edison Electric Institute’s (“EEI”) request for clarification of Order No. 833. Order No. 833 amended FERC’s regulations regarding Critical Energy Infrastructure Information (“CEII”), as directed by the FAST Act. The FAST Act, signed into law on December 4, 2015, added section 215A to the Federal Power Act (“FPA”) to improve the security and resilience of energy infrastructure in the face of emergencies. The FAST Act also directed FERC to issue regulations on the procedures for designating certain material as CEII, provided for the imposition of sanctions on any party who knowingly discloses CEII, and authorized the voluntary sharing of CEII material.
On June 16, 2016, FERC released a Notice of Proposed Rulemaking (“NOPR”) proposing to amend its regulations to comply with and implement the FAST Act. Following the issuance of the NOPR, nineteen entities filed comments and two entities filed reply comments. On November 17, 2016, FERC released a Final Rule, Order No. 833, which implemented the provisions of the FAST Act and revised FERC’s existing CEII regulations (see November 21, 2016 edition of the WER). In Order No. 833, FERC determined that its amended regulations conform to the stipulations of the FAST Act and provided safeguards to ensure the secure treatment of CEII material.
In its request for clarification or, in the alternative, rehearing of Order No. 833, EEI raised five issues. First, EEI argued that FERC should reconsider its determination that CEII can be voluntarily shared over the objections of submitters. In Order No. 833, FERC established a process for FERC staff to voluntarily share CEII when there is a need to ensure infrastructure is protected. Additionally, FERC stated that the voluntary sharing process does not impose a sharing requirement on entities; instead, the provisions allow FERC discretion in sharing CEII that has already been submitted. EEI argued that these provisions allowed FERC to “involuntarily share” CEII material over an entity’s objection and that FERC should only facilitate voluntary sharing of CEII “by and between entities.” FERC denied rehearing on this issue, stating EEI “misconstrues [the statute] to argue that the statute’s directives regarding voluntary sharing do not include voluntary sharing of CEII by the Commission.” FERC also stated that it would be incompatible with the FAST Act if FERC could not share CEII material in its possession.
Second, EEI argued FERC erred by declining to provide or clarify the criteria that FERC would use to determine whether a member of the public is eligible to obtain CEII materials, and requested that FERC adopt “criteria stating that the Commission will consider public safety benefits before releasing CEII.” FERC granted clarification on this issue and agreed to include “public safety benefits” as one of the criteria that the CEII Coordinator should consider when making decisions to release CEII to the public. FERC denied rehearing of this issue, however, because it reasoned that FERC already “provided sufficient detail on the circumstances” in which CEII material would be shared. In addition, FERC determined that “a conclusory statement of need by a CEII requester will not suffice,” and individuals must show a “demonstrated need” to access CEII materials.
Third, EEI requested clarification and rehearing of the minimum requirements for Non-Disclosure Agreements (“NDA”) and, of the procedure by which FERC decides that FERC-generated information is CEII. EEI argued that modernizing the CEII NDA would mitigate the risks of a CEII recipient disclosing such information to a hostile actor. EEI also argued that FERC should provide a process for an entity to comment on a possible disclosure of FERC-generated CEII. On the NDA issue, FERC granted clarification and denied EEI’s request for rehearing. FERC determined that, although it would not make any changes to the minimum requirements set out in an NDA, it would allow the CEII Coordinator to determine whether any additional provisions should be added to an NDA on a case-by-case basis. FERC similarly granted clarification and denied rehearing of EEI’s argument that it should develop a process for entities to comment on FERC-generated CEII. FERC reasoned that the FAST Act did not require FERC to provide notice and opportunity to comment on the possible disclosure of CEII. FERC clarified, however, that its CEII Coordinator could solicit comments when evaluating whether to release a FERC-generated CEII document.
Lastly, EEI requested rehearing of a determination in Order No. 833 that FERC would not limit the Department of Energy’s (“DOE”) ability to designate materials that are CEII. FERC denied rehearing of this issue and reasoned that, “[N]othing within the FAST Act compels DOE to make changes to its regulations, and nothing in the Commission’s regulations limits DOE’s ability to designate information in accordance with the FAST Act.”
A copy of FERC’s order can be found here.