Navigating the NERC Level 3 Alert on IBR Performance: What Does It Mean for Utilities?

In May 2025, the North American Electric Reliability Corporation (NERC) issued a Level 3 Alert requiring immediate action from Generator Owners (GOs), Transmission Owners (TOs), Transmission Planners (TPs), and Planning Coordinators (PCs). This unprecedented alert—focused on Inverter-Based Resource (IBR) performance and modeling—is a call to improve the reliability of the Bulk Power System (BPS) in light of rapidly growing renewable and inverter-connected resources.

This article breaks down the key drivers, essential actions, and how EPE is positioned to support utilities, ISOs, and RTOs in this critical transition.

What Triggered the Alert?

Since 2016, NERC has analyzed more than 15,000 MW of unexpected generation loss from major IBR-related disturbances. These events were not captured or anticipated by current planning models, revealing a widespread gap in how IBRs are represented in system studies.

Despite multiple voluntary guidelines and reports from NERC—including 10 major event reports and four Level 2 Alerts—key issues persist:

• Less progress through recommended practices than anticipated
• Lack of access to critical IBR modeling data
• Outdated or inconsistent models

The Level 3 Alert elevates the urgency of addressing these issues and places specific responsibilities on registered entities.

Summary of Essential Actions for TPs and PCs

Action 1: Define and Publish Clear Performance Requirements

TOs, TPs, and PCs must enhance their generator interconnection criteria and planning requirements to include detailed IBR-specific performance expectations. These expectations must be:

• Transparent and publicly available (e.g., posted via OASIS)
• Uniform where feasible, with clearly stated value ranges and settings for:
• Reactive power control and automatic voltage regulation
• Frequency response behavior and settings like droop and deadbands
• Voltage and frequency ride-through (VRT/FRT) during grid disturbances
• Post-disturbance recovery metrics (e.g., recovery time and current prioritization)

This action will ensure that developers and OEMs design the systems with consistent and auditable performance benchmarks.

Action 2: Enhance Modeling and Validation Practices

Planning entities must validate that IBR models accurately reflect field behavior. Specifically:

• Benchmark both Positive Sequence Phasor Domain (PSPD) and Electro Magnetic Transient (EMT) models—both equipment-specific and generic library — against measured data.
• Requesting GO to provide:
• Documentation showing parameter consistency between study models and on-site equipment.
• Verification that model behavior matches model performance and commissioning tests

This is critical to ensure that the models are a real representation of the actual equipment in the field with correct performance.

Action 3: Assess and Improve Currently Operating IBR Models

Utilities are now responsible for retrospectively reviewing IBRs already operating on their systems. This includes:

• Comparing field performance vs. model behavior for past disturbances or test cases
• Identifying and addressing modeling inaccuracies
• Updating models to reflect current operating behavior and communicating changes to all relevant stakeholders

This action reflects NERC’s focus on continuous model integrity—not just at the interconnection stage but throughout the operational lifecycle of the asset.

Figure 1: Key utility actions from the NERC Level 3 Alert: define clear performance requirements, refine modeling and validation practices (PSPD and EMT), and review operating models.

EPE’s Role in Supporting Compliance and System Reliability

At EPE, we recognize that these new requirements represent both a challenge and an opportunity for system operators and utilities. Our technical team has extensive experience in IBR performance modeling, dynamic studies, and EMT simulations. We offer a range of services aligned with NERC Alert 3 Essential Actions:

• Advisory & Compliance Support: Assist TOs/TPs in updating interconnection and planning documents
• EMT Modeling & Validation: Provide model benchmarking services, and review and create unit validation reports to verify model fidelity
• Performance Assessment for Existing IBRs: Conduct model vs. field performance comparisons; Identify gaps in behavior and recommend corrective actions, and support utilities in updating models and documenting the change process
• Post-Event and Ad Hoc Studies: Perform root-cause analysis after unexpected events, Deliver system-level studies for High Voltage Direct Current (HVDC) integration, grid-forming inverter behavior, and weak grid scenarios
• Capacity Building: Host technical workshops and training sessions on EMT simulations, IBR control systems, and NERC compliances.

Closing Thoughts

NERC’s Level 3 Alert marks a significant evolution in how IBRs are expected to perform and how their behavior must be documented and validated. For utilities, ISOs, and RTOs, this is a time to act decisively. With the right technical partner, these requirements can be transformed into a roadmap for more reliable, resilient, and transparent interconnection processes.

To learn more about the Generator Owner's action plan in response to the NERC Level 3 Alert, please refer to our companion article here.