What is one major consequence of a NERC reliability standard violation?

One major consequence of a NERC reliability standard violation is the imposition of financial penalties. NERC (North American Electric Reliability Corporation) establishes and enforces standards aimed at ensuring the reliability of the bulk power system. When entities do not comply with these standards, they may incur significant fines, which serve as a deterrent against non-compliance and emphasize the importance of maintaining reliable operations in the electric power industry.

Financial penalties are a critical aspect of regulatory enforcement because they hold organizations accountable for their operational practices, ensuring they prioritize reliability and take necessary actions to rectify any shortcomings. This mechanism encourages continuous improvement and adherence to the high standards set by NERC, ultimately promoting the stability and reliability of the entire electrical grid.