IBR Risk Element: Changes and Internal Controls Recommendations

Inverter-based resources (IBRs) such as wind, solar, and battery storage constitute a large portion of newly interconnected generators, and will likely continue to do so based on current projections. Recent events such as the Odessa disturbance and the Panhandle wind disturbance show that these resource mix changes come with reliability risks. With this in mind, IBRs remain a risk element in the 2025 Compliance Monitoring and Enforcement Program Implementation Plan (CMEP IP).

Inverter-based resources were also a CMEP IP Risk Element in 2024. The primary change in 2025 is that PRC-005-6 R3 and R5 and PRC-027-1 R1, R2, and R3 are now associated with the IBR risk element, signaling the importance of proper maintenance and coordination to reduce risks. Texas RE has been focusing on the risks posed by miscoordination since PRC-027-1 became effective. Without proper coordination, relays may not operate in the intended sequence, leading to Misoperations and disconnecting generation from the system unnecessarily.

Texas RE has seen coordination issues that increase the risk Misoperations downstream. Specifically, instances where Responsible Entities are not responding to each other in a timely manner (and sometimes not responding at all). As a result, entities may implement settings without confirmation from other entities that no coordination issues exist. It can’t be assumed that the absence of a response indicates an absence of coordination issues.

Internal controls to consider for PRC-027-1 are:

1. Ensure that contact lists are kept up-to-date and shared with electrically joined entities so coordination requests can be sent to the correct people.
2. When requesting settings from an electrically joined entity, list your project timeline and due dates for that entity. This will allow the electrically joined entity to better prioritize the request with the rest of their workload.
3. Requesting entities should set follow-up reminders and know who to escalate requests to in the event the receiving entity does not respond within the necessary timeline.
4. Develop a control such as peer review or a project checklist to verify and document that coordination issues don’t exist, or that identified coordination issues have been resolved prior to implementing settings.
5. Build internal controls into your Protection System maintenance, Misoperations, and other processes to identify any coordination changes arising from unforeseen circumstances.

Although new to the IBR risk element, PRC-005-6 has been identified as a risk for several years. It is important that Protection System components are kept in proper working order. Entities that have IBRs and Transmission Owners (TOs) that have Protection Systems directly interconnected with IBRs would be considered a risk.

Internal controls to consider for PRC-005-6 are:

1. Entities could establish a process to evaluate changes to Protection System settings once maintenance activities are complete to determine if coordination is affected and if coordinating with electrically joined entities is required.
2. Establish a detective control to verify maintenance activities were done within the maintenance interval and that the evidence of completing the required maintenance activities is sufficient and appropriate.
3. Establish preventative controls, such as work orders, to ensure that maintenance is scheduled and completed within the maximum maintenance intervals.
4. If your entity monitors Protection System components, have controls in place to ensure monitoring capabilities are tested and have evidence to support monitoring.
5. Ensure that you have controls in place to identify and track unresolved maintenance issues, as well as a method to demonstrate efforts to resolve the issue(s). Ensure there is a control in place to communicate unresolved maintenance issues and the equipment’s status to the appropriate personnel.

Entities can reduce the risk of PRC-027-1 and PRC-005-6 noncompliance with internal controls. Standards associated with a risk element have an elevated priority related to engagement scoping. Engagements will likely include internal controls assessments for these Standards, which provides Texas RE with a picture of the effectiveness of the entity’s internal controls.