Here shortly, and obvious knows that 7. 9 magnitude earthquake hit off of the coast of alaska and the Pacific Northwest with tsunami warnings for activities that were expect and warnings for the tsunami waves were recalled but i am sure that the sen or the is dealing with items related to and that other h issues. I want to thank the chairman mr. Mcintyre and mr. Walker for being here, and many of the staffs that are going to be hearing that we are back in operation. So we look forward to hearing about the sun jek the subjec reliability. And last year we looked at the reliability of the electric grid in light of the mixing fuel change. We have carefully distinguished on the issues of new items to have renewable renewals and also frequent response and also to adopt resilient metrics that needed to be developed. Fortunately when the secretary perry filed the report as a proposal to furk, i was more alarmed. It was the conclusion of the departments own staff, and it was a transparent attempt in my attempt to prop up the different kinds of energy that are outpaced in the marketplace, and there are many eitems near the proposal and it picked up a few power plants and the fuels stored on site and above all other factor, and they promised full recovery for coal to follow a market model years ago, and the problem is that it would hit billions of consumers with a added cost to multiple independent assessments, and bailing out coal plants just isnt bad policy, but it is breathtaking raid on the consumers pocketbooks and the pga market monitor found that the proposal could double the cost of the wholesale energy cost in the electricity market. So i want to applaud the chairman for rejecting the s secretarys proposal tachlt heart of the rejection is the heart of the consumers and the commission wisely looked at the power act for adjusting electric rates at reasonable, and they had not met the burden under the current rules being unjust and so we could not have added anymore to this defense. It is never more important for furc to maintain the independence, and we hope that it has not given resilience a bad name. The difference of the grids recovery in hurricanes and earthquakes in puerto rico is showing that the items that affect life and quality does deserve attention. And so we are looking at other witness, and she served on the National Academy of the report on the Grid Resilience and i would like to submit that to the organization. And it is going to be what they explored today, and madam chair, thank you for the witnesses to today and calling forward this hearing. My apologies to these witness, and the Committee Members that we had a busy day in alaska and all is well, and i appreciate more than ever the value of thing likes the earthquake and tsunami Early Warning system, and so it is important that they are there and that it is finally operating now that the government is back to order. Last week, we outlined the busy agenda of the hearing and we will maintain the legislation, and nomination, and oversight is a critical part of the role, and we are obligated to operate under our jurisdiction, gauge whether federal policy is helping or hindering improvements in Energy System performance. While it they not have, been u to alaska standards, the cold snow and ice endured by many in the lower 48 especially along the eastern seaboard was notable over the holidays into the new year. While the worst of it occurred over and on the shoulders of a holiday period and didnt reach the extremes felt in the 2014 polar vortex, we did experience a socalled bomb cyclone event. I understand that a bomb cyclone is a cyclone storm system in which the Pressure Drops precipitously in a short period of time. Apparently, these happen relatively often off the northeast coast, but this recent storm was a recordbreaker. With the largest Pressure Drop in a 24hour period since 1976. As such, it presented a kind of informative stress test for the electric power system. Now, ive often said that federal law and policy must enable energy to be affordable, clean, diverse and secursecure. With this hearing, we rush to a subject ive been following keenly since 2010 about how changesctric grid are stressing system reliability and what federal changes may be necessary to address those stresses. The secretary of energys noticed a proposed rule making issued in september and the recent furk order in response were focused on these same issues. In 2014, following the polar vortex, we held a similar hearing to examine challenges to the electric system. I said then that we needed to redouble a properly scaled and continuously improving approach to grid reliability and security. Im pleased to say, to see, that todays testimony shows that there were many Lessons Learned from that extreme weather event. Sfr for example, there appears to be improved coordination between the electric and gas systems. Rtos and furk have reformed market rules and improved practices. Nurk updated its approaches. Thats good news. The bad news is weve not addressed the more difficult and fundamental challenges for electric and Gas Infrastructure. For example, gas Pipeline Infrastructure remains too constra constrained. Broader policy changes are not sufficiently taken into account increasing risks that in future years system operators may have to turn to intentional service interruptions, otherwise known as load shedding or rolling brownouts or blackouts, to manage certain peak periods. One of our witnesses will speak about the situation in new england. Which is some respects could serve as a harbinger of challenges in other parts of our nation. We must ensure that our nations natural gas supply, which is a boone to our economy oand our National Security, can be reliably delivered to a changing marketplace. At the same time, its not clear what the reliability and Economic Impacts will be a grid whose primary electricity resources are less die veshs over time as base load nuclear and coal units continue to retire. Meeting all of these challenges will also strengthen congre competition, should be a shared priority. Providing competition has been a tenet of policy that has enjoyed wide bipartisan support for more than two decades and sould houl remain so. Today well hear from furk and the department of energy and hear from the heads of three regulated entities with quasi regulatory responsibilities, the north American Electricity Reliability Corporation or naerc and no regional organizations, pjm and iso new england. We have a member of the committ science, engineering and medicines with us. I welcome each of you to the committee this morning. Look forward to your testimony. I would ask that you try to limit your test moanthy this morning to about five minutes. Your full statements will be included as part of the record. This morning were joined by the honorable kevin mccintyre. This is the first thyme you him appeared before the committee in your capacity as chairman. We welcome you. The honorable bruce walker is also with us as assistant secretary. The office of electricity delivery and Energy Reliability at the usdoe. Good to see you again, bruce. Mr. Charles baradesco, interim president and ceo for naerc, north American Electric reliability commission. Miss allison clements. Senator cantwell mentioned your contributions. We thank you. Mr. Andrew od, president and ceo. And mr. Gordon van walle, president and ceo of iso new england. Welcome to each of you. Chairman mcintyre, if you would like to begin with your comments this morning. Yi yes, senator, chairman murkowski, Ranking Member cantwell and members of the committee. Thunk you for the opportunity to appear before you today to discuss the performance of the electric system during the recent weather events. I am honored to serve as the chairman of the ferc. Our Commission Takes conspiracily the responsibility that congress entrusted to us. Concerning the reliability, the bulk power system in this country. Were still receiving and reviewing data related to the performance of the bulk power system during the cold weather event thats taken place over the past month. Based on what we know to date, it appears that notwithstanding stress in several regions, overall the bulk power system performed relatively well amid challenging circumstances. Looking forward, we must both learn from this experience and remain vigilant with respect to challenges to the reliability and resilience of the bulk power system. The performance of the bulk power system during the 2014 went event you referred to now commonly known as the polar vortex did provide useful context for understanding the performance of the bulk power system under the most recent winter events of the past month. During the 2014 polar vortex, much of the u. S. Experienced sustained and at times extreme cold weather. The challenges presented by these conditions and high electric demand were compounded by unplanned generator shutdowns of various fuel types. These combined circumstances tested grid reliability and Power Supplies and contributed to high electricity prices. Drawing on that experience, ferc took numerous actions as you have referenced to address reliability and resource performance issues. For example, commission directed regional transmission organizations and independent system operators, or rtos and isos, as we usually call them, to report on fuel assurance issues and the Commission Revised its regulations to enhance coordination between the natural gas and the electric industries in light of the increasing use of natural gas as fuel for electric generation. For certain regions, the Commission Approved capacity capacity market reforms that have intended to increase financial incentives for improved resource performance and to penalize nonperformance or poor performance. The Commission Also approved temporary winter reliability programs in new england. Turning to the winter event Winter Weather events of the past month, it is useful to consider the impact of the recent weather events on both the provision of service and the associated costs of that service. Importantly, there were no significant customer outages that resulted from failures of the bulk power system generators or transmission lines. While there were no significant reliability problems during this recent cold weather event, wholesale Energy Prices were high, reflecting the stress on the system. Higher wholesale Energy Prices that accurately reflect fuel costs and Current System conditions can be beneficial, sending important signals that drive operational and Investment Decisions for both utilities and consumers. We also recognize that higher wholesale Energy Prices are ultimately born by retail customers. So the commission is attentive to the potential of behavior that takes add van tavantage of weather events. Just as the commission and the rtos and isos drew lessons from the polar vortex in 2014 and applied them in ways that better prepared us for this recent cold weather event, we will examine these more recent i vents very carefully and seek to learn from them. Id like to emphasize a few points that the commission made, order issued a couple weeks ago on the issue of resilience more generally, referred to by Ranking Member cantwell in her opening remarks. On january 8th, the commission responded to the proposed rule on grid reliability and resilience pricing submitted to the commission by the secretary of energy. And we initiated a new proceeding to further explore resilience issues beginning with the rtos and the isos. As we stated in our order, we appreciate the secretary reinforcing the importance of the resilience of our bulk power system as an issue that warrants further attention and as we said in our order, prompt attention. The goals of our new proceeding are, first, to develop a common understanding among the commission and industry and others as to what resilience of the bulk power system actually means and requires. Second, to understand how each rto and iso assesses resilience within its geographic footprint. And third, to use this information to evaluate whether Additional Commission action regarding resilience is appropriate at this time. Commission directed each rto and iso to submit within 60 days of our order specific information regarding resilience of the bulk power system within those respective regions, and we invite other interested entities to follile reply comments withi0 days. We expect to review the additional material and promptly decide whether action is warranted. In our january 8th order, the Commission Also recognized that the concept of resilience necessarily involves issues that extend beyond power commissions du jurisdiction such as modernization. For that reason, we encouraged rtos and iso and other interested entities to engage with state regulators and other stakeholders to address resilience at the distribution level and more broadly. I assure you the reliability and ensure of the bulk power system will remain the priority of the f fecrc. I look forward to answering your questions. Thank you, chairman mcintyre. Assistant secretary walker, welcome. Thank you. Distinguished members of the committee, thank you for the opportunity to discuss the issue of Grid Resilience during the recent cold weather affecting the northeast United States. Just two months ago i testified before this Committee Secretary perry and the administration remain committed to supporting this restoration. The topic of todays hearing is timely. The resilience and reliability of the Energy Sector are Top Priorities of the secretary and major focus of the department of energy. In fact, the first stud y requested was the staff report of electricity markets and rye liability. The evolution of the wholesale electric markets, effect on grid reliability and resilience as it relates to wholesale energy and capacity markets, compensating specific attributes and connection between regular teto burdens and retirement of base load plants. The last several months have been quite demanding on the Energy Sector. From an extremely active hurricane season, to the 2018 deep freeze, we con frofronted challenges that tested the resilience and reliability of the Energy Infrastructure. Late december 2017 to early january, the northeast saw record low temperatures for several days. However, customer outages were minimal. What was apparent during this weather event was the continued reliance on base Load Generation and Diverse Energy portfolio. Without action that recognizes the essential Reliability Services provided by strategically diversified generation portfolio, we cannot guarantee the resilience of the electric grid. The grids sbintegrity is maintained by fuel sources today especially with onsite fuel capabilities. The real question is whether or not this diversity will be here tomorrow. Resilience has become more important than ever as major parts of our economy are totally dependent on electricity. Even momentarily disruptions and power quality cab result n res h losses. With this process of change likely to continue for many years. Keeping the light on during this transformation will require unprecedented collaboration amongst many parties. D. O. E. Is committed to work with ferc and regional rtos and isos to achieve this mission. Stakeholders are faces multiple connected issues. With growing assets stressed, integration of increasing amounts of Energy Resources, consumer participation, dynamic markets, increasing cyber over the next century. Today, the marketplace rather than the engineering principles focused on building and main dayiday i maintaining an Energy System is driving the design of the system. However, it is clear, we need an indepth in order to know how to best modify existing market structures or, and or build kne resiliency standards into the system. D. O. E. Undertake an analysis that integrates. It also fills any gaps and harm onnize iz onizes various earfforts at the same levels p. M. Im taking the opportunity to make my position clear. I believe building this rezil yancey model should be the top thing for d. O. E. Oer the coverg heres as does the leadership of the department of energy. To address challenges posed by the events of the recent cold snap and infrastructure issues, its critical for us to be proactive, cultivate an ecosystem of resilience, network of producers, distributorsing regular, vent vendors and partners. D. O. E. Continues to partner with states, local governments and other stakeholders to quickly identify threats to develop indepth strategies to mitigate those threats and rapidly respond to any disruption. Resilience is not a onetime activity by a hasnt. Not something that can be done in 24 to 48 hours before an event. Approaching our Energy Sector resulting from investments made today. In conclusion, were faced with various threats that continually become more frequent land impactful. Accordingly, we need to build upon the reliable system we have today, realize from the hard work of ferc and the rtos and isos to make them more resilient to stave the deleterious effects of these present and real threats. The nearterm concern is that Energy Markets are significantly driving the investments made in generation sourc