Standards of Conduct and Reporting Requirements for Transportation and Affiliate Transactions
Federal RegisterJun 27, 1994
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DEPARTMENT OF ENERGY
18 CFR Parts 161, 250 and 284
[Docket No. RM94-6-000 and Order No. 566]
Standards of Conduct and Reporting Requirements for
Transportation and Affiliate Transactions
Issued June 17, 1994.
AGENCY: Federal Energy Regulatory Commission.
ACTION: Final rule.
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SUMMARY: The Federal Energy Regulatory Commission (Commission) is
revising its regulations governing standards of conduct and reporting
requirements for transportation and affiliate transactions by natural
gas pipelines. The Commission is reducing the reporting requirements
significantly based on changes in the way pipelines allocate capacity
after implementation of Order No. 636 and the Commission's experience
with the reporting requirements.
EFFECTIVE DATE: The rule will become effective August 1, 1994.
ADDRESSES: Federal Energy Regulatory Commission, 825 North Capitol
Street NE., Washington, DC 20426.
FOR FURTHER INFORMATION CONTACT: Michael Goldenberg, Federal Energy
Regulatory Commission, 825 North Capitol Street NE., Washington, DC
20426, (202) 208-2294.
SUPPLEMENTARY INFORMATION: In addition to publishing the full text of
this document in the Federal Register, the Commission also provides all
interested persons an opportunity to inspect or copy the contents of
this document during normal business hours in Room 3104, 941 North
Capitol Street NE., Washington DC 20426.
The Commission Issuance Posting System (CIPS), an electronic
bulletin board service, provides access to the texts of formal
documents issued by the Commission. CIPS is available at no charge to
the user and may be accessed using a personal computer with a modem by
dialing (202) 208-1397. To access CIPS, set your communications
software to use 300, 1200 or 2400 bps, full duplex, no parity, 8 data
bits, and 1 stop bit. CIPS can also be accessed at 9600 bps by dialing
(202) 208-1781. The full text of this notice will be available on CIPS
for 30 days from the date of issuance. The complete text on diskette in
WordPerfect format may also be purchased from the Commission's copy
contractor, La Dorn Systems Corporation, also located in Room 3104, 941
North Capitol Street NE., Washington DC 20426.
Table of Contents
I. Introduction
II. Reporting Requirements
III. Background
IV. Summary of the Final Rule
V. Overview of the Standards of Conduct and Reporting Requirements
VI. Standards of Conduct
A. Definitions
B. Information Disclosure Requirements
1. Standard E--Disclosure of Information Received From Non-
affiliates
2. Standard F--Disclosure of Transportation-Related Information
C. Standard H--Tieing Gas Subject to Take-Or-Pay Relief
D. Standard I (New Standard H)--Affiliate Discounts
Contemporaneously Disclosed To Similarly Situated Shippers
1. Retention of Standard H
2. Revision of the Standard to Eliminate Duplicative Posting
Requirements
3. Specific Issues
a. Affiliate's Role in a Transportation Transaction
b. Inclusion of Receipt Points
c. Disclosure of Non-Affiliate Discounts
E. Standard G & Standard K (New Standard J)--Separation of
Operating Employees and Books of Account
VII. Tariff Requirements
A. Shared Operating Personnel
B. Request For Service Information
C. Availability And Pricing Of Transportation Services
VIII. Transportation Information
A. Capacity Allocation Log
B. Discount Information For Affiliate and Non-Affiliate
Transactions
IX. EBB Access and Archiving Requirements
X. Miscellaneous Issues
A. Reporting Of Affiliate Discounts Under Part 284
B. Relation Of The Marketing Affiliate Regulations Of This Rule
To Tariff Requirements Addressing Similar Problems
C. Applicability Of The Marketing Affiliate Regulations Of This
Rule To Permanent Releases Of Capacity
D. EBB Posting Of Information Constitutes A Filing
E. Posting Of Pipeline Tariffs
F. Relationship To The Commission's EBB Standards Proceeding
XI. Environmental Analysis
XII. Regulatory Flexibility Act Certification
XIII. Information Collection Requirement
XIV. Effective Date
Regulatory Text
Appendix A--Parties Filing Comments On The Notice Of Proposed
Rulemaking
Appendix B--FERC Form No. 592
I. Introduction
In the matter of: Before Commissioners: Elizabeth Anne Moler,
Chair; Vicky A. Bailey, James J. Hoecker, William L. Massey, and
Donald F. Santa, Jr.
The Federal Energy Regulatory Commission (Commission) is amending
its regulations governing Standards of Conduct and reporting
requirements for transportation and affiliate transactions. The
Commission is significantly reducing its reporting requirements based
on changes in the way pipelines will be allocating capacity after
implementation of Order No. 6361 and the Commission's experience
with the reporting requirements.
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\1\Pipeline Service Obligations and Revisions to Regulations
Governing Self-Implementing Transportation; and Regulation of
Natural Gas Pipelines After Partial Wellhead Decontrol, 57 FR 13267
(Apr. 16, 1992), III FERC Stats. & Regs. Preambles 30,939 (Apr. 8,
1992), order on reh'g, Order No. 636-A, 57 FR 36128 (Aug. 12, 1992),
III FERC Stats. & Regs. Preambles 30,950 (Aug. 3, 1992), order on
reh'g, Order No. 636-B, 57 FR 57911 (Dec. 8, 1992), 61 FERC 61,272
(1992), appeal re-docketed sub nom., Atlanta Gas Light Company and
Chattanooga Gas Company, et al. v. FERC, No. 94-1171 (D.C. Cir. May
27, 1994).
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II. Reporting Requirements
The Commission estimates the public reporting burden for this
collection of information under the final rule to average 60 hours per
respondent, including the time for reviewing instructions, searching
existing data sources, gathering and maintaining the data needed, and
completing and reviewing the collection of information. In lieu of
being physically filed with the Commission on a periodic basis as a
``response'' or ``filing'', the data will be posted on pipeline
Electronic Bulletin Boards (EBBs), established and maintained by the
pipeline respondents pursuant to Order No. 636, and collected under
FERC-592, Marketing Affiliates of Interstate Pipelines to be provided
to the Commission upon request. The annual reporting burden for some 61
respondents under the rule is estimated to total approximately 3,500
hours.
Because the rule provides for fewer information items, eliminates
regular, periodic filings, and requires certain information to be
posted or made available upon request in text format, the burden
estimate for FERC-592 in the Final Rule represents a burden reduction
of about 70 hours per respondent--or a total reduction of about 4,300
hours. The current annual reporting burden attributable to the FERC-592
information collection is 7,881.2 hours. A copy of this final rule is
being provided to the Office of Management and Budget (OMB).
Interested persons may send comments regarding the burden estimates
or any other aspect of this collection of information, including
suggestions for further reductions of this burden, to the Federal
Energy Regulatory Commission, 941 North Capitol Street, N.E.,
Washington, D.C. 20426 [Attention: Michael Miller, Information Services
Division, (202) 208-1415, FAX (202) 208-2425]. Comments on the
requirements of this rule may also be sent to the Office of Information
and Regulatory Affairs of OMB, Washington, D.C. 20503 [Attention: Desk
Officer for Federal Energy Regulatory Commission (202) 395-6880].
III. Background
The Commission, in Order No. 497,2 issued a rule intended to
prevent pipelines from providing preferential treatment to their
marketing or brokering affiliates. The rule adopted Standards of
Conduct (codified at Part 161 of the Commission's regulations)3
and tariff and reporting requirements (codified in Sec. 250.16)4
The Standards of Conduct establish the principles applicable to
relationships between pipelines and their affiliates. In general, they
provide that the pipeline cannot favor affiliates with information or
transportation discounts not available to non-affiliates. The tariff
provisions require pipelines to include in their tariffs a list of
operating personnel shared with affiliates, the information and format
for transportation service requests, the procedures used to resolve
complaints, the procedures used to inform shippers about the
availability and pricing of transportation services.
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\2\Inquiry Into Alleged Anticompetitive Practices Related to
Marketing Affiliates of Interstate Pipelines, Order No. 497, 53 FR
22139 (June 14, 1988), FERC Stats. & Regs. [Regulations Preambles
1986-1990] 30,820 (1988), order on rehearing, Order No. 497-A, 54
FR 52781 (Dec. 22, 1989), FERC Stats. & Regs. [Regulations Preambles
1986-1990] 30,868 (1989), order extending sunset date, Order No.
497-B, 55 FR 53291 (Dec. 28, 1990), FERC Stats. & Regs. [Regulations
Preambles 1986-1990] 30,908 (1990), order extending sunset date
and amending final rule, Order No. 497-C, 57 FR 9 (Jan. 2, 1992),
III FERC Stats. & Regs 30,934 (1991), reh'g denied, 57 FR 5815, 58
FERC 61,139 (1992), aff'd in part and remanded in part, Tenneco
Gas v. Federal Energy Regulatory Commission, 969 F.2d 1187 (D.C.
Cir. 1992), order on remand, Order No. 497-D, 57 FR 58978 (Dec. 14,
1992), III FERC Stats. & Regs. 30,958 (1992), order on reh'g and
extending sunset date, Order No. 497-E, 59 F.R. 243 (Jan. 4, 1994),
III FERC Stats. & Regs. 30,987 (Dec. 23, 1994), order on reh'g,
Order No. 497-F, 59 FR 15336 (Apr. 1, 1994), 66 FERC 61,347
(1994).
\3\18 CFR Part 161.
\4\18 CFR 250.16.
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The reporting requirements require pipelines to provide information
relating to transportation transactions with affiliates. The pipelines
must file FERC Form No. 592, a log containing information relating to
requests for transportation service by affiliated marketers and to
discounts provided to affiliates. The regulations also require the
pipelines to maintain the same information for non-affiliated shippers
and to provide that information to the Commission upon request.
The Commission imposed a sunset provision requiring a reevaluation
of the requirements of the rule within one year to determine whether
increased competition in transportation had mitigated the concerns
about affiliate abuse. The Commission has extended the sunset provision
on several occasions, most recently extending it until June 30,
1994.5
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\5\Order No. 497-E, III FERC Stats. & Regs. Preambles 30,987.
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In Order No. 636, the Commission created a new operating
environment for interstate pipelines and shippers by requiring
pipelines to unbundle their sale of gas from their transportation
service and by implementing changes in the terms and conditions for
providing transportation service. One of the principal changes
introduced by Order No. 636 was the initiation of capacity release
mechanisms through which firm shippers can release their firm
transportation capacity, including storage capacity, to others wanting
to obtain the capacity. The Commission also required that pipelines
establish EBBs to provide information about available firm and
interruptible capacity on the pipeline, including the firm capacity
available through capacity release.6
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\6\Secs. 284.8(b)(4); 284.9(b)(4). The Commission also has
issued Order No. 563 promulgating standards governing the methods by
which pipelines will provide information about available capacity
through their EBBs. Standards For Electronic Bulletin Boards
Required Under Part 284 of the Commission's Regulations, Order No.
563, 59 FR 516 (Jan. 5, 1994), III FERC Stats. & Regs. Preambles
30,988 (Dec. 23, 1993), order on reh'g, Order No. 563-A, 59 FR 23624
(May 6, 1994), III FERC Stats. & Regs. Preambles 30,994 (May 2,
1994).
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The Commission previously has addressed the effect of EBBs and
capacity release on the Order No. 497 requirements. In Order No. 497-D,
the Commission eliminated the requirement that pipelines file the Form
No. 592 containing the affiliated transportation log with the
Commission, requiring instead that they provide this information on
their EBBs.7 The Commission also determined that Order No. 497
does not apply to temporary capacity releases, because such releases
are not a request for transportation to the pipeline.8 The
releasing shipper, not the pipeline, controls and makes the
determination to release capacity; the pipeline merely facilitates the
transaction.
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\7\Order No. 497-D, III FERC Stats. & Regs. Preambles at 30,737.
\8\Northwest Pipeline Corporation, 65 FERC 61,007 (1993). A
temporary capacity release occurs when the releasing shipper retains
its rights to the capacity when the release period ends. A permanent
release ends the releasing shipper's rights and responsibilities
under the contract and the contract is transferred to the
replacement shipper.
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With the implementation of Order No. 636 on virtually all
pipelines, the Commission reevaluated its Order No. 497 requirements in
light of the requirements of Order No. 636 as well as the Commission's
experience under Order No. 497. On December 23, 1993, the Commission
issued the Notice of Proposed Rulemaking (NOPR)9 in this docket in
which the Commission proposed significant reductions in the Order No.
497 reporting requirements as well as the elimination of one of the
Standards of Conduct. The Commission, however, also invited comment on
the need for, and retention of, the requirements as a whole. The
Commission has received 22 comments on the NOPR.10
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\9\Standards of Conduct and Reporting Requirements for
Transportation and Affiliate Transactions, 59 FR 268 (Jan. 4, 1994),
IV FERC Stats. & Regs. [Proposed Regulations] 32,504 (Dec. 23,
1993).
\1\0Appendix A lists all those filing comments with the
abbreviations used for each.
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IV. Summary of the Final Rule
The final rule revises both the Standards of Conduct and the
reporting requirements in a number of respects. The Commission is
reducing the pipelines' reporting burden by eliminating maintenance and
posting requirements relating to requests for transportation service
and implementing in their stead limited requirements that better
comport with pipeline operations under Order No. 636.
In particular, the regulations are being revised to reflect the
data used by pipelines to allocate capacity among shippers when
available capacity is not sufficient for the pipelines to honor all
requests for service. For those pipelines whose tariffs rely upon
contract information to allocate capacity, the pipelines will be
required to maintain a log (for both affiliates and non-affiliates) of
contract dates or other relevant information that they use to allocate
capacity. Pipelines that allocate capacity on a pro rata basis (or use
a method that does not rely on contract data) will not have to maintain
the log. The affiliate log must be posted on the pipelines' EBBs, while
the full log (for both affiliates and non-affiliates) must be provided
to the Commission, within a reasonable time, upon request according to
the specifications and format contained in Form No. 592.\11\
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\11\Form No. 592 is attached as Appendix B and will not be
published in the Federal Register.
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The Commission also is coordinating its posting requirements for
affiliate discounts to eliminate duplicative EBB postings. Current
Sec. 250.16 requires the pipelines to post information about affiliate
discounts on their EBBs. Current Standard of Conduct I requires
pipelines to make any discount offered to an affiliate
contemporaneously available to non-affiliates. In order for the
pipelines to fulfill this obligation, the Commission has required that
they make a contemporaneous posting on their EBBs of information about
affiliate discounts, so that non-affiliates will be aware of the
discount and can request a comparable discount if they believe they are
similarly situated.\12\ To eliminate the posting of duplicative
information, the Commission is incorporating a contemporaneous posting
requirement for affiliate offers into former Standard I (new Standard
H)\13\ and is deleting the similar requirement for posting affiliate
discounts under Sec. 250.16. In effect, the Commission is not adding a
new reporting requirement here. It is merely moving a current EBB
posting requirement from Sec. 250.16 to new Standard H in order to
eliminate duplicative postings.
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\12\Colorado Interstate Gas Company, 65 FERC 61,264 at 62,224-
25 (1993).
\13\The new designation of Standard H will be used throughout
the order.
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Section 250.16 also required pipelines to maintain discount
information for both affiliate and non-affiliate transactions and
provide this information to the Commission upon request. The Commission
is retaining this maintenance requirement, because information on
affiliate and non-affiliate transactions is needed for the Commission
to monitor affiliate transactions and compare these transactions with
non-affiliate transactions.\14\
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\14\The information must be provided to the Commission according
to the specifications and format contained in Form No. 592.
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The current reporting requirements expire on June 30, 1994. Section
553(d) of the Administrative Procedure Act (APA)\15\ generally requires
that a rule is to be effective not less than 30 days after publication
in the Federal Register unless good cause is shown to shorten the time
period. Because the final rule continues some of the reporting
requirements from the existing rule, a gap between the termination of
the old requirements and the implementation of the new could result in
a loss of information. Rather than requiring the pipelines to expedite
implementation of the new regulations to prevent a regulatory gap, the
Commission in a contemporaneous order, in Docket No. RM87-5-016, is
extending the current reporting requirements for only one month, until
July 31, 1994. The regulations adopted by this order will then go into
effect on August 1, 1994.
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\15\5 U.S.C. 553(d).
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The Commission will first provide an overview of the Order No. 497
requirements and address the general comments relating to retention of
these provisions as a whole and will then address specific comments and
issues regarding the Standards of Conduct, tariff requirements, and
reporting requirements.
V. Overview of the Standards of Conduct and Reporting Requirements
In the NOPR, the Commission stated that, as part of its continuing
assessment of the Order No. 497 regulations, it would consider comments
on the need to retain these requirements as a whole. Many pipeline
commenters submit that all the Order No. 497 requirements should be
removed as unnecessary and duplicative of existing prohibitions on
undue discrimination.\16\ They maintain that six years after
promulgation of the regulations, no pattern of abuse has been
demonstrated.
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\16\AER/MRT, CNG, Columbia, El Paso, Enron Pipelines, INGAA, K N
Energy, KGPC, National, Panhandle Eastern Pipelines, Questar, WGM,
WNG/Northwest.
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They further contend that the potential for pipelines to provide
preferential treatment to their affiliates has been virtually
eliminated by the restructuring of pipeline operations pursuant to
Order No. 636. They maintain that the unbundling of pipeline gas sales
from transportation service has resulted in a truly competitive market
in which all gas sellers will be able to compete on an even basis. They
argue that the Commission's establishment of a mechanism permitting
firm shippers to release capacity has eliminated the pipelines'
monopoly over transportation service, so that the pipelines' ability to
grant significant preferences to affiliates is reduced or eliminated.
The capacity release mechanism, they maintain, creates an open auction
for firm capacity in which the pipeline must award capacity to the
highest bidder and so cannot favor its affiliate.\17\ They also assert
that the ability of pipelines to favor affiliates with important
transportation information has been undercut by the Commission's
requirement that the most critical transportation information be
disclosed publicly on pipeline EBBs. Moreover, if some potential for
abuse remains, they contend the Commission's complaint process and
enforcement staff provides adequate means to detect and prevent such
abuse.
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\17\They similarly contend that, under Order No. 636 provisions,
pipelines cannot discriminate in awarding interruptible service
because it must be awarded to the highest bidder.
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These commenters also contend that the limited need, if any, for
the regulations, must be juxtaposed with the anticompetitive effects of
the regulations. They assert the regulations run counter to the
Commission's goal of fostering competition because they have the effect
of inhibiting beneficial communication between pipelines and
affiliates, thereby limiting the ability of affiliates to compete in
the marketplace.
If the Commission decides to retain some or all of these
requirements, these commenters recommend that the Commission provide a
sunset date (generally one year) on which the regulations will expire.
They assert that a sunset provision will ensure a comprehensive
reevaluation of the requirements after further experience with capacity
release.
On the other side, Hadson and Indicated Parties support the
continuation of the requirements, with some additions. Hadson asserts
that the new deregulated gas environment will increase competitive
pressures on all players, thereby increasing the incentive and
likelihood that pipelines will try to enhance the competitive position
of their affiliates and sales marketing divisions.
Indicated Parties argue that the Commission should add a new
provision prohibiting pipelines from providing a discount to an
affiliate which is a supply area interruptible shipper.\18\ They assert
that affiliates can use a pipeline's standing offer of a transportation
discount to undercut a transaction negotiated by a non-affiliated
competitor and that even contemporaneous disclosure of the discount
does not provide the non-affiliate with sufficient time to save its
transaction.
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\18\Indicated Parties would not prohibit supply area discounts
if the discount offer is posted on an EBB significantly prior to gas
flow so all shippers can avail themselves of the discount. They also
would not prohibit individual discounts to market area shippers.
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At this time, the Commission is not convinced that pipelines'
incentives or ability to favor affiliates has been so significantly
reduced by Order No. 636 that these provisions can be removed
entirely.\19\ While the unbundling of pipeline gas sales from
transportation service does create a more competitive gas market,
pipelines may still have an incentive to skew transportation
transactions and information in such a way as to benefit affiliates.
The requirement to post information on EBBs has not eliminated the
pipelines' ability to favor their affiliates with information. By
virtue of their position, pipelines may still be privy to important
information regarding transportation capacity that they are not
required to post on their EBBs.\20\ More important, at this stage, the
Commission does not have sufficient experience with the new capacity
release mechanism established by Order No. 636 to evaluate whether this
mechanism will create such a competitive market for transportation
capacity that pipeline preferences for affiliates will no longer be of
significance.
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\19\The absence of any significant complaints is not necessarily
due to the pipelines' lack of incentive or inability to favor
affiliates. It may, instead, be due to the pipelines' adherence to
the Order No. 497 requirements and the public scrutiny of affiliate
transactions provided by the regulations.
\20\For example, pipelines will be aware of their own future
plans, such as anticipated expansions, which might be valuable
planning information for marketers. Without the Standards of
Conduct, the pipelines could favor their affiliates by providing
advance notice of their plans.
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Nonetheless, the purposes of Order No. 497 can be achieved in a
manner that is substantially less burdensome to pipelines. The
Standards of Conduct and reporting requirements that remain establish a
reasonable balance between preservation of the affiliates' ability to
compete and the prevention of undue favoritism to the affiliates.
As discussed later, the Commission is retaining all the Standards
of Conduct (with the exception of Standard H). These Standards
generally require pipelines to: refrain from disclosing non-affiliate
information to affiliates; contemporaneously disclose to the market any
general transportation information provided to affiliates; make any
discount offered to an affiliate contemporaneously available to
similarly situated non-affiliates by posting the information on the
pipelines' EBB; and maintain separation of pipeline and affiliate
operating personnel to the maximum extent practicable. These Standards
of Conduct do not prevent pipelines from transacting business with
their affiliates or communicating with or providing discounts to
affiliates; they require only that the pipelines initiate common sense
procedures to ensure that affiliates are not provided with information
or discounts not available to others.
Only two reporting requirements remain: the current requirement to
maintain discount information for affiliates and non-affiliates and a
revised requirement that some pipelines maintain and disclose the data
used to allocate service on their systems. These requirements are much
reduced from those under the current regulations and are the minimum
needed to provide sufficient information about affiliate transactions
for the Commission and shippers to monitor and police these
transactions.
The Commission will not prohibit supply area discounts to
affiliates, as Indicated Parties suggest. Preventing all supply area
discounts would seriously impede the ability of affiliates to compete
by denying them justifiable discounts available to non-affiliates. New
Standard H requires pipelines to make any such discounts
contemporaneously available to other similarly situated shippers and
this provision strikes the appropriate balance between protection of
non-affiliates and maintenance of competition between affiliates and
non-affiliates.
The Commission is not proposing a sunset provision for these
regulations, because a firm date, such as one year, may not provide a
sufficient period for a comprehensive evaluation of the impact of Order
No. 636 on the affiliate regulations. The Commission, however, is
committed to reviewing these requirements as the industry obtains more
experience operating in the restructured environment, and, in
particular, is interested in the effect of capacity release on pipeline
interruptible service.
VI. Standards of Conduct
The Commission proposed to delete only one provision from the
Standards of Conduct (Sec. 161.3 dealing with take-or-pay issues).
Tenneco and KGPC contend that all Standards of Conduct provisions
should be removed because the conduct they seek to prevent is already
precluded by the requirements, in Secs. 284.8 and 284.9, that pipelines
must not unduly discriminate in the provision of transportation
service. Tenneco asserts the standards actually may send the wrong
signal by suggesting that unduly discriminatory conduct not mentioned
in the standards is somehow considered less egregious than conduct
specifically mentioned. Many other commenters request that the
Commission delete or modify specific provisions.
The Commission continues to find that retention of most of the
Standards of Conduct are necessary to prevent affiliate abuse, as will
be discussed below with respect to specific provisions.
A. Definitions
Indicated Parties suggest that the Commission include a new
definition of marketing affiliate that makes clear it applies to
pipelines' new merchant service established under Order No. 636 and a
revision in the definition of transportation to make clear that
transportation includes storage. Section 284.286 provides that
pipelines' new merchant divisions are subject to the marketing
affiliate regulations,\21\ and, therefore no new definition is needed.
The Commission, however, will revise both Part 161 and Sec. 250.16 to
cross-reference Sec. 284.286.\22\ The Commission also is revising
Sec. 284.286 to conform to the changes being made in Sec. 161.3.\23\
Section 284.1 of the Commission's regulations defines transportation as
including storage,\24\ and the Commission will revise the definition of
transportation in Sec. 161.2 to parallel the Part 284 definition.\25\
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\21\18 CFR 284.286; Order No. 636, III FERC Stats. & Regs.
Preambles at 30,442.
\22\The Commission also is revising Sec. 161.1 to correspond
with the current Part 284 regulations by deleting the unnecessary
references to pipelines transporting gas pursuant to Subparts H and
K of Part 284. Section 161.1 will continue to refer to pipelines
transporting gas pursuant to Subparts B and G. Continued reference
to Subparts H and K is redundant since both Subparts apply to
pipelines transporting gas under Subparts B and G.
\23\Because the revisions to Part 284 are purely ministerial,
the Commission concludes it has good cause under the Administrative
Procedure Act for finding that notice and public comment on these
revisions is unnecessary and contrary to the public interest. 5
U.S.C. 553(b).
\24\18 CFR 284.1.
\25\The Commission further is deleting the obsolete reference to
pipeline interruptible sales certificates. See Arkla Energy
Resources Company, et al., 59 FERC 61,173 (1992).
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B. Information Disclosure Requirements
Standard E provides that pipelines may not disclose to affiliates
any information the pipeline receives from non-affiliated shippers.
Standard F provides that pipelines must contemporaneously disclose to
all shippers any information related to transportation that the
pipelines provide to affiliates. In Order No. 497-E, the Commission
revised Standard F to eliminate the requirement for contemporaneous
disclosure of sales and marketing information the pipelines provide to
marketing affiliates.\26\
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\26\Order No. 497-E, III FERC Stats. & Regs. Preambles at 30,985
& n.19.
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1. Standard E--Disclosure of Information Received From Non-affiliates
Tenneco contends Standard E should be removed entirely. It argues
no basis exists for prohibiting disclosure to marketing affiliates of
information received from other shippers, while permitting that
information to be disclosed to non-affiliates. It maintains that if a
shipper would be harmed by pipeline disclosure of information the
shipper provides, the same harm would result from disclosure of that
information to another non-affiliate.
The Commission concludes that the Standard needs to be retained to
prevent potential affiliate abuse. The Standard recognizes that the
pipelines have access to non-affiliate information due to the
pipelines' control over transportation service and that the pipelines
have an economic incentive to favor affiliates with such information
when disclosure will benefit the affiliate. The same incentive does not
apply to sharing of non-affiliate information with other non-
affiliates.\27\
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\27\Tenneco's argument that harm may result from disclosure of
non-affiliate information to other non-affiliates would not
necessarily dictate the deletion of Standard E, as Tenneco argues.
It could justify expanding the Standard to prohibit disclosure to
non-affiliates as well. But the Order No. 497 regulations are
limited to affiliates because the pipelines have an economic
incentive to favor affiliates, which is lacking in their dealings
with non-affiliates. Undue discrimination with respect to non-
affiliates would be covered by the general Part 284 regulations.
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CNG contends Standard E should be modified to permit disclosure of
sales and marketing information: only the sharing of transportation
related information would be prohibited. CNG recognizes the Commission
took a contrary position in Order No. 497-E, but urges the Commission
to reexamine that conclusion.28 CNG argues that the transmission
of sales and marketing information is unrelated to the pipeline's
exercise of market power over transportation, which is the only
legitimate basis for restricting disclosure. CNG also claims Standard E
may work to the disadvantage of non-affiliated shippers. For example,
it states that, during the recent cold weather, it received requests
for help in locating gas supplies that, due to Standard E, it was
unable to pass along to its marketing affiliates, which may have been
able to assist those customers.
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\2\8Order No. 497-E, III FERC Stats. & Regs. Preambles at 30,985
& n.19.
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The Commission reaffirms its decision in Order No. 497-E to retain
the Standard E restrictions on disclosure of all information (including
sales and marketing information) received from non-affiliated shippers.
Unlike sales and marketing information that the pipelines obtain from
the public domain (and can provide to affiliates under Standard F),
sales and marketing information obtained from non-affiliated shippers
(Standard E information) is directly related to the pipelines' control
over transportation service. While public domain information is
available to all, the information pipelines obtain from their customers
is not, and Standard E prevents the pipelines from favoring their
affiliates by providing them with non-public information that the
pipelines have obtained as result of providing transportation service.
CNG contends the Standard prohibits disclosure of information to
affiliates when such disclosure may benefit the non-affiliated shipper
providing the information to the pipeline. The Standard is intended to
protect a non-affiliated shipper against the disclosure of confidential
or commercially sensitive information to marketing affiliates. If the
non-affiliated shipper finds such disclosure to be in its interest, it
can waive its Standard E protection.29
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\2\9See El Paso Natural Gas Company, et al. 67 FERC 61,016 at
61,043 (1994).
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2. Standard F--Disclosure of Transportation-Related Information
Panhandle Eastern Pipelines and Tenneco contend Standard F should
be deleted. They contend even the remaining requirement to disclose
transportation-related information needlessly inhibits competition,
because the pipelines are uncertain what information they need to
publicly disclose and, therefore, may act cautiously by withholding
beneficial, legitimate information from affiliates. They assert that
with the advent of capacity release, the pipelines' monopoly over
transportation has been lessened, so that the rationale for the
regulation no longer exists. Further, they contend that all important
information related to transportation is now required to be made
publicly available on the pipelines' EBBs. Tenneco observes that a less
intrusive means of preventing abuse would be for the Commission to
specify the transportation information that could provide competitive
advantages and require that this information be posted on the EBBS.
The Commission will retain Standard F. By requiring contemporaneous
disclosure of transportation information provided to affiliates,
Standard F ensures equal treatment of non-affiliates and affiliates,
without undue burden on the pipelines. Not all transportation related
information may be disclosed on pipeline EBBs, yet advance knowledge of
such transportation information could be of value to an
affiliate.30 The Commission fails to see how capacity release
justifies deletion of the Standard. The potential to acquire released
capacity does not mitigate the harm to non-affiliates that could result
from selective disclosure of important non-public transportation
information to affiliates.
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\3\0For example, a pipeline's future plans to add facilities,
such as new receipt or delivery points or additional capacity is not
currently disclosed on EBBs, but advance knowledge of such
transportation information could be of value to an affiliate.
---------------------------------------------------------------------------
Further, the Commission is not in the best position to determine
all the types of transportation information that may be of competitive
significance. The more general requirement of Standard F to post any
information pipelines provide to affiliates permits the market itself
to determine whether the information is of value. The Standard,
therefore, strikes a reasonable balance between the need to protect
against undue favoritism to affiliates and the need to permit pipelines
to transact business with their affiliates.
KGPC also requests clarification of what transportation information
must be contemporaneously disclosed. It asserts that in Order Nos. 497
and 497-A, the Commission stated that specific transportation, sales,
and marketing information related to the affiliate's request need not
be disclosed. It claims that although the Standard was difficult to
interpret even before Order No. 497-E established different
requirements for disclosure of sales and marketing information and
transportation information, the distinction between these categories of
information has made the determination of what information must be
disclosed even more complex.
As the Commission stated in Order Nos. 497 and 497-A, pipelines
need only contemporaneously disclose general transportation information
provided to an affiliate; they need not disclose information related to
the affiliate's specific transportation request.\31\ This distinction
appears reasonably self-explanatory, and KGPC has not explained why the
distinction is difficult to make, nor has it identified specific
situations that cause it difficulty, so that the Commission can provide
guidance.
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\31\See Order No. 497, III FERC Stats. & Regs. [1986-1990]
Regulation Preambles] at 31,141; Order No. 497-A, III FERC Stats. &
Regs. [1986-1990] Regulation Preambles] at 31,597.
---------------------------------------------------------------------------
KGPC further requests clarification of the Commission's statement
in Order No. 497-E that, even though sales and marketing information no
longer must be disclosed under Standard F, the Commission is not barred
from examining such questions, if relevant and necessary, in specific
cases. KGPC requests that the Commission specify the circumstances in
which it will consider such issues.
In Order No. 497-E, the Commission removed the general requirement
for pipelines to disclose sales and marketing information. However, the
Commission still retains the right to determine in individual
proceedings that certain pipelines must disclose sales and marketing
information when the circumstances show such disclosure is needed to
prevent undue discrimination.
C. Standard H--Tieing Gas Subject to Take-Or-Pay Relief
In the NOPR, the Commission proposed to eliminate Sec. 161.3(h) of
the regulations which prohibits pipelines from conditioning or tieing
an agreement to release gas subject to take-or-pay relief to the
purchase of services from a marketing affiliate. The Commission stated
that this provision should no longer be needed since Order No. 636
established procedures for dealing with gas supply realignment (GSR)
costs resulting from the reformation or termination of take-or-pay
contracts after the unbundling of sales from transportation
service.\32\
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\32\Order No. 636, III FERC Stats. & Regs. Preambles at 30,458.
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Hadson and Indicated Parties argue for retention of this provision.
Hadson states that, while the size of the take-or-pay problem has been
reduced, the Commission has approved pricing differential mechanisms
for reducing GSR costs under which gas subject to take-or-pay contracts
is auctioned by the pipeline or marketing affiliate on a monthly basis.
It also states the Commission has approved reverse auctions. These
mechanisms, it asserts, still create the potential for anticompetitive
tieing. Indicated Parties suggest that the phrase gas supply
realignment costs be substituted for take-or-pay costs to ensure that
pipelines do not attempt to tie the availability of unbundled
transportation and storage services to the purchase of specific gas
supplies.\33\ But they do not explain why retention of this requirement
is necessary in light of the procedures established in Order No. 636
and the restructuring cases for dealing with GSR costs.
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\33\They both also contend the Commission should retain current
Sec. 250.16(b)(2)(xiii), which requires disclosure of whether any
gas being transported is subject to take-or-pay relief. Indicated
Parties again suggests the substitution of gas supply realignment
costs for take-or-pay.
---------------------------------------------------------------------------
The Commission will delete this requirement. Hadson has not
demonstrated how the pipeline would rig an auction or a reverse
auction\34\ that would result in tieing of an agreement to release gas
to the purchase of services from an affiliate. The auction or reverse
auction involves bidding on gas contracts which is independent of any
services provided by a marketing affiliate. Moreover, the Commission
can better monitor potential affiliate abuse in auctions by considering
the circumstances of the auction mechanism proposed in individual cases
rather than by promulgating a generic standard, which may not apply to
certain cases.\35\
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\34\In a reverse auction, parties bid an amount that the
pipeline must pay them to take over pipeline gas contracts with
prices that are above the market price. The pipeline, therefore,
accepts the lowest bid (rather than the highest as in a standard
auction).
\35\See Texas Eastern Transmission Corporation, 64 FERC 1,305
at 63,310 (1993)(finding sufficient safeguards against affiliate
abuse); Natural Gas Pipeline Company of America, 64 FERC 61,295 at
63,104-05 (1993).
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D. Standard I (New Standard H)--Affiliate Discounts Contemporaneously
Disclosed To Similarly Situated Shippers
1. Retention of Standard H
The Commission is retaining the current standard, which is being
renumbered Standard H. Current Standard I requires pipelines making a
transportation discount to an affiliate to make a comparable discount
contemporaneously available to all similarly situated non-affiliates. A
number of commenters contend this provision should be removed.
El Paso asserts the regulation is not needed, contending pipelines
will not make an unjustified discount to an affiliate, because the
pipelines will lose money. It further argues that pipelines may
actually forgo making beneficial and competitive case specific
discounts to affiliates because of the vagueness of the term
``similarly situated.'' It asserts pipelines may not offer their
affiliates a discount to avoid the risk of having to unjustifiably
reduce rates to other shippers.
K N Energy similarly contends that pipelines may not provide a
market-justified discount to affiliates given the extra obligations and
heightened scrutiny created by the provision. KGPC maintains the
requirement seriously restricts negotiations between pipelines and
affiliates because the parties must be continuously concerned about
whether a conversation could be construed as an offer.
K N Energy and Tenneco contend the requirement is not needed
because the Commission has sufficient mechanisms to monitor and prevent
undue discrimination. They point out the pipelines are required to file
discount reports under Part 284, which enable non-affiliates to monitor
discounts and file complaints of undue discrimination.
The Commission will not delete Standard H, because requiring
pipelines to make discounts contemporaneously available to similarly
situated non-affiliates is needed to ensure equal treatment. Standard H
does not substantially inhibit the provision of justified discounts to
affiliates. When pipelines offer discounts to affiliates, they must
only be able to provide a valid explanation for why another shipper
requesting a comparable discount is not similarly situated to the
affiliate.
The discount information required to be filed under Part 284 is not
a substitute for Standard H. Standard H requires pipelines to make
offers contemporaneously available to similarly situated shippers. In
contrast, the Part 284 discount information is not filed until 15 days
after the close of the billing period, which is not equivalent to the
contemporaneous notice required under Standard H.
2. Revision of the Standard to Eliminate Duplicative Posting
Requirements
The Commission is revising the standard to eliminate duplicative
postings of information about affiliate discounts. Section 250.16
currently requires the pipelines to post information about affiliate
discounts on their EBBs. This information includes the duration of a
discount, the discounted rate, the maximum rate, and the quantity of
gas scheduled at the discounted rate during the billing period for each
delivery point. A number of commenters requested that the Commission
reduce or eliminate the Sec. 250.16 reporting requirement.
Former Standard I required pipelines to make discounts available to
similarly situated non-affiliates.\36\ In Colorado Interstate Gas
Company (CIG),\37\ the Commission sought to eliminate any potential
ambiguity about the way in which pipelines are to determine similarly
situated shippers under the standard. The Commission found that
pipelines could make a determination of similarly situated only if the
pipelines first informed non-affiliates of the terms of the affiliate
offer so the non-affiliates would have the opportunity to request a
comparable discount if they thought they were similarly situated.\38\
Since all pipelines are now required by Order No. 636 to maintain EBBs,
the Commission provided that the pipelines needed, at a minimum, to
provide notice of affiliate discounts by posting them on the pipelines'
EBBs. The information to be posted is virtually identical to that
required under Sec. 250.16, including the date of the offer, the
discount rate, the quantity of gas scheduled to be moved at the
discounted rate, and the delivery points in the offer. Most pipelines
now comply with the standard by using EBB posting.
---------------------------------------------------------------------------
\36\Although the standard did not state the method for making
discounts contemporaneously available to non-affiliates, the
Commission suggested EBB posting as a means for communicating such
information. Order No. 497-A, FERC Stats. & Regs. [Regulations
Preambles 1986-1990] at 31,596.
\37\65 FERC 61,264 at 62,224-25 (1993).
\38\For example, a pipeline cannot determine on its own whether
the non-affiliate was willing to abide by the terms and conditions
contained in the affiliate offer. It needs to provide the non-
affiliate with notice of the terms and the opportunity to comply
with them.
---------------------------------------------------------------------------
The Commission has determined that the duplicative posting
requirements for affiliate discounts are not necessary. The Commission,
therefore, will modify Standard H to clarify that pipelines are to
comply with the Standard by contemporaneously posting information about
affiliate discounts on their EBBs and permitting non-affiliates to
request such discounts if they conclude they are similarly situated.
The Commission will then eliminate the requirement to make similar EBB
postings under Sec. 250.16. These revisions do not add a new reporting
requirement. They essentially eliminate duplicative postings by moving
the affiliate discount posting requirement from Sec. 250.16 to Standard
H.
The elimination of the Sec. 250.16 reports will not adversely
affect the ability of non-affiliates to monitor affiliate transactions.
The only significant difference between the Standard H and Sec. 250.16
EBB posting requirements is that the Sec. 250.16 reports are posted at
the close of the billing period so they include the quantity of gas
actually scheduled by the affiliate whereas scheduled quantity
information could not be included in a contemporaneous posting under
Standard H. But after-the-fact information on actual quantities
scheduled is not needed for shippers adequately to monitor affiliate
transactions. Non-affiliates only need to be able to determine whether
they were denied a discount offered to an affiliate, and the
information in the contemporaneous postings will allow them to make
this determination. The actual quantities scheduled under a discount
casts no light on whether the pipeline engaged in undue discrimination
when the discount was offered.39
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\3\9As discussed later, pipelines still will be required, under
Sec. 250.16, to maintain discount information for both affiliate and
non-affiliate transactions. See text accompanying note 63, infra.
The Commission still requires the affiliate and non-affiliate
information, including the actual volumes shipped, to be able to
adequately review completed affiliate and non-affiliate
transactions.
---------------------------------------------------------------------------
Accordingly, the Commission will incorporate into Standard H the
requirement that a pipeline offering a discount to an affiliate (or a
discount for a transportation transaction in which an affiliate is
involved) must contemporaneously post the offer on its EBB and maintain
the posting for 90 days. The posting must include the date of the
offer, the discount rate, the quantity of gas scheduled to be moved at
the discounted rate, the delivery points in the offer, any conditions
underlying the offer (for example, if the discount is dependent on an
agreement to move a certain quantity of gas or on the use of a specific
transportation path), and the procedures by which shippers can request
a comparable discount. The posting of the information must conform with
the requirements applicable to pipelines' EBBs as required in
Sec. 284.8(b)(4).40
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\4\0The requirements for EBB access to this information are
discussed at the text accompanying note 65, infra.
---------------------------------------------------------------------------
3. Specific Issues
a. Affiliate's Role in a Transportation Transaction
In the NOPR, the Commission proposed to require the pipelines to
disclose an affiliate's role in a transportation transaction when they
are not the shipper in the transaction.41 Several pipelines object
to this proposal, contending it creates an impossible burden since
pipelines will not know the affiliate's role if it is not a
shipper.42 KGPC contends that disclosure of an affiliate's role,
when it is not a shipper, runs counter to the Commission's
determination in Order No. 497-E to eliminate Standard F's
contemporaneous posting requirements for non-transportation related
information. Texas Gas states that since the pipeline generally will
not know whether an affiliate is involved, the Commission should permit
pipelines to obtain this information from shippers.43
---------------------------------------------------------------------------
\4\1In the NOPR, this proposal was related to the requirements
under Sec. 250.16. Since the Commission has moved the EBB posting
requirement to Standard H, the Commission will address here comments
on the NOPR that are applicable to the contemporaneous posting of
affiliate discount offers on pipeline EBBs.
\4\2CNG, K N Energy, KGPC, Panhandle Eastern Pipelines, WGM,
WNG/Northwest.
\4\3It states that most pipelines already require shippers to
complete a request form for internal purposes and that information
on the affiliate's role could be included on that form, even if no
other Order No. 497 information needs to be included.
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The Commission's requirement to disclose discounts when an
affiliate is involved in the transaction is merely a continuation of
the requirement in Sec. 250.16(b)(2) of the existing regulations to
report such transactions.44 In many instances, pipelines are aware
of the role played by its affiliate or sales operating unit. For
instance, when the affiliate acts as an agent in a transaction (by
arranging for gas supplies and transportation), the pipeline may know
of the affiliate's role even when it is not the official shipper
because the affiliate will be making the transportation arrangements on
behalf of its client. In response to Texas Gas's comment, the
Commission will not require the pipelines to obtain the information
from shippers about affiliate involvement. The pipelines need disclose
that information only when they have knowledge of the affiliate's
involvement in the transaction.
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\4\4In fact, pipelines have reported transactions in which an
affiliate is not the shipper under the existing regulations.
---------------------------------------------------------------------------
The Commission finds no inconsistency between the requirement to
disclose transactions in which an affiliate is involved and its
decision in Order No. 497-E to eliminate the contemporaneous disclosure
requirement for sales and marketing information provided to an
affiliate. When a pipeline is aware that its affiliate is involved in a
transportation transaction, it may offer a selective transportation
discount to the actual shipper in order to ensure that the shipper does
business with the affiliate. Thus, a pipeline's provision of a
transportation discount in a transaction in which an affiliate is
involved can raise the same question of potential undue discrimination
as a discount provided directly to the affiliate. Conversely, when the
pipeline does not know of its marketing affiliate's involvement in a
transaction, the possibility of unduly preferential behavior seems
unlikely.
b. Inclusion of Receipt Points
The National Registry contends that receipt point information
should be included because discounts may sometimes depend on the point
at which gas enters the system. The Commission, however, will not
include receipt points because receipt point information is often
voluminous. If in a particular case, a discount is based on the receipt
point used, that condition would be disclosed as a condition for
granting the discount.
c. Disclosure of Non-Affiliate Discounts
Indicated Parties suggest that the Commission require posting of
non-affiliate discount information on the EBB within 15 days of the
commencement of service. KGPC also suggests that the Commission should
replace the affiliate reporting requirements with a general requirement
for EBB posting of all interruptible transactions.
The Commission will not require posting of non-affiliate
information, because information on discounts to non-affiliates is
unrelated to the goal of the reporting requirements--to permit non-
affiliates to monitor affiliate discounts for possible discrimination.
A non-affiliate need not have access to other non-affiliate information
to monitor affiliate transactions; the non-affiliate can compare any
affiliate discounts with the rate the non-affiliate pays. The non-
affiliate information will be available to the Commission upon request,
under Sec. 250.16, should the Commission need to compare the discounts
offered to affiliates and non-affiliates in investigating a complaint
of discrimination.
E. Standard G & Standard K (New Standard J)--Separation of Operating
Employees and Books of Account
Current Standards G and K require that the operating employees of
pipelines and affiliates function independently to the maximum extent
practicable and that the books of account for the pipelines and
affiliates be maintained separately. Tenneco contends these provisions
are unnecessary after Order No. 636, because pipelines are required by
Order No. 636 to unbundle sales from transportation service and,
therefore, must establish separate operations and staffs. Moreover, as
a practical matter, it contends employees making day-to-day decisions
regarding gas transportation will not be making decisions for the
affiliate.
By requiring separation of operating personnel to the maximum
extent practicable, Standard G complements the other Standards of
Conduct by reducing the possibility that information will improperly be
shared with an affiliate. Tenneco is correct that in Order No. 636, the
Commission did adopt new regulations under Part 284 that, like Standard
G, require pipelines to ensure that their unbundled sales operating
personnel operate independently from its transportation operating
personnel.45 But these regulations do not apply to marketing
affiliates, and, therefore, Standard G still is needed to ensure
adequate separation of pipeline and marketing affiliate personnel.
---------------------------------------------------------------------------
\4\518 CFR 284.286.
---------------------------------------------------------------------------
Standard J's requirement for separation of books of account is
needed to permit scrutiny of costs so that affiliate costs are not
shifted to the pipeline's rate base and recovered from the pipeline's
transportation customers.
VII. Tariff Requirements
A. Shared Operating Personnel
Section 250.16(b)(1)(i) requires pipelines to maintain in their
tariffs a list of operating personnel shared by the pipelines and their
affiliates, which, under Sec. 250.16(d)(2), they must update quarterly,
if any changes occur. The NOPR proposed to continue this requirement.
CNG and Panhandle Eastern Pipelines request clarification that the
pipelines will not be required to make quarterly filings if no changes
in shared personnel or facilities have occurred. The Commission agrees
that a filing need only be made if changes have occurred.
B. Request For Service Information
The Commission proposed to eliminate the requirement, in current
Sec. 250.16(b)(1)(ii), that pipelines include in their tariffs the
information required for a valid request for service, including the
information required for the Form No. 592 affiliate transportation log.
Indicated Parties suggest this provision be retained, so parties will
know what must be included in a valid request for service. They assert
that, as far they can determine, this requirement is not duplicated in
other regulations and that such information is important, because a
valid request for service is often a prerequisite for participation in
the capacity release program.
The Commission finds that the requirement for pipelines to include
information needed for a valid service request is no longer related to
affiliate abuse. Under the previous regulations, pipelines were
required to report certain information about shippers that the
pipelines could obtain only through the transportation request
form.46 Under this rule, the Commission is no longer requiring
pipelines to report these categories of information, and, therefore, a
tariff provision requiring shippers to disclose such information is no
longer needed. The Commission notes, however, that, under Part 284,
pipelines must have tariff provisions that provide for equality of
transportation service, with reasonable and non-discriminatory terms
and conditions for acquiring such service.47 To comply with these
requirements, the pipelines still must have tariff provisions
describing the procedures necessary to request service and participate
in the capacity release program.
---------------------------------------------------------------------------
\4\6For example, for each transportation transaction reported on
Form No. 592, pipelines were required to report the supplier of gas,
the end-user, and whether or not the gas was subject to take-or-pay
relief. This information would be known by the shippers, not the
pipeline. The requirement for shippers to complete the
transportation request form to obtain service ensured that the
pipelines would obtain the necessary information from the shipper.
\4\7See 18 CFR 284.8, 284.9, 284.14.
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C. Availability And Pricing Of Transportation Services
The Commission proposed to eliminate current Sec. 250.16(b)(1)(iv)
that requires pipeline tariffs to include the procedures used to inform
affiliated and non-affiliated shippers of the availability and pricing
of transportation service and of the capacity available for
transportation. The Commission concluded this requirement was
superfluous in light of the Order No. 636 requirement for pipelines to
provide equal and timely access on their EBBs to information relevant
to the availability of service on their systems.48
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\4\818 CFR 284.8(b) (3), (4); 18 CFR 284.9(b) (3), (4).
---------------------------------------------------------------------------
Indicated Parties contend that the current Order No. 636
requirements do not require pipelines to post the procedures used to
determine the availability of transportation services, the amount of
capacity the pipelines have available, or the pricing of services. They
submit that the Commission should ensure that pipeline tariffs require
pipelines to post information on ``operationally available'' capacity
on their EBBs and to describe the procedures used in posting the
information, such as the timing of postings.
The Commission concludes that the requirements of Part 284 provide
sufficient disclosure of the necessary information about capacity on
pipelines. Towards that end, the Commission recently issued Order No.
563 detailing the information about capacity that the pipelines must
disclose on their EBBs (as well as through downloadable files),
including operationally available capacity.49 In that proceeding,
the Commission found no need for requiring pipelines to file tariffs
setting forth the way in which the pipelines will provide the
information required by the rule.50
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\4\9Order No. 563, III FERC Stats. & Regs. Preambles at 31,007.
\5\0Order No. 563, III FERC Stats. & Regs. Preambles at 31,004.
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VIII. Transportation Information
Current Sec. 250.16 requires pipelines to post a variety of
information about affiliate transportation service requests and
affiliate discounts on the pipelines' EBBs. The regulations also
require the pipelines to maintain the same information for non-
affiliate transactions, so that it can be provided to the Commission
upon request.
In the NOPR, the Commission proposed to reduce significantly the
information concerning shippers' requests for transportation service,
retaining only a few elements, principally relating to the position of
requests in the pipelines' transportation queues.51 But the
Commission was unsure about the value of these requirements and
requested comments on whether they should be retained. In the NOPR, the
Commission proposed to retain the maintenance and posting requirements
related to affiliate and non-affiliate discounts, but proposed to limit
these requirements to interruptible transportation.
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\5\1The request for service items proposed to be retained were:
the identity of the shipper requesting service, the date the request
was received, the affiliation of the requester with the pipeline,
the maximum daily volume of gas requested, the position of the
request in the transportation queue, the disposition of the request,
complaints concerning requested or provided service, and any tariff
waivers granted in providing the requested service.
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A. Capacity Allocation Log
Many commenters contend all service request information should be
deleted. WGM and WNG/Northwest contend the original basis for these
requirements was to monitor the process of awarding contracts so that
affiliates would not receive preferential queue positions. They
maintain this rationale is no longer valid since queues are no longer
used in the restructured environment. Numerous other commenters
similarly contend that queues no longer have any effect on curtailment
or bumping rights.52 Texas Gas also points out that Sec. 284.13 of
the Commission's regulations requires pipelines to keep, and make
publicly available, a log of requests for service that contains much of
the same information as required by Sec. 250.16.53
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\5\2AER/MRT (should at least provide a ``not applicable''
designation for pipelines without queues), Columbia, KGPC, Natural
(arguing request date revealed by proposed Sec. 250.16(c)(2) so
queue position not needed), Panhandle Eastern Pipelines, Questar,
Tenneco, Texas Gas, and TGPL.
\5\3Texas Gas further argues that the information required to be
provided about the disposition of a service request is meaningless,
and that, even if it has some value, the information is supplied
through other filing requirements.
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Panhandle Eastern Pipelines, Natural, and TGPL contend the
requirement to post complaints parallels the Commission's requirement
to disclose complaint procedures in the tariff and only one should be
retained. TGPL and Natural contend that complaints are solely between
the pipeline and the complaining party, so electronic posting serves no
purpose. TGPL further argues that posting of complaints is too complex
for electronic format. AER/MRT request that complaints by end-users
should not be included since the Commission has proposed deleting the
requirement to post the state of the ultimate end-user (former
Sec. 250.16(b)(2)(xi)).
AER/MRT and TGPL contend the requirement to post tariff waivers
duplicates Standard L, which requires pipelines to maintain a log of
tariff waivers that must be available for copying on a daily basis.
Indicated Parties, however, requests the waiver provision be amended to
require separate reporting of waivers granted to affiliates and sales
marketing units.
The Commission agrees that the data now required to be posted
concerning service requests do not reflect the methods used by the
pipelines to allocate capacity. As the commenters point out, Commission
policy and pipeline tariffs require that interruptible transportation
be allocated first on the basis of price paid when the pipeline is
unable to provide the amount of requested service. If the rate bid
still is not sufficient to allocate interruptible capacity, some
pipelines rely on pro rata allocation or some other means to allocate
capacity that does not depend on contract dates or other similar
information. For these pipelines, the Commission agrees that posting
contract information is not necessary because that information bears no
relation to the capacity allocation decision.
However, some pipelines continue to rely on contract or other
information to break ties and determine to whom interruptible capacity
is allocated. But even for these pipelines, the current regulations may
not capture the appropriate information used to allocate interruptible
capacity. The current regulations only require the pipelines to
maintain information about the service request date, while some
pipelines use other dates or other information for allocation of
interruptible capacity, such as the contract execution date, the date
gas is first shipped under a contract, rate schedule, transportation
type, or other rankings.54 Some pipelines rely on similar contract
information in allocating firm capacity during curtailments.
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\5\4For examples of the variety of information used, see ANR
Pipeline Company, Second Rev. Vol No. 1, Original Sheet No. 118,
General Terms and Conditions, Section 9.2 (date of agreement and
request for service date); Koch Gateway Pipeline Company, Fifth Rev.
Vol No. 1, Second Sub. Orig. Sheet Nos. 1806 & 1807, General Terms
and Conditions, Section 11.4(c)(3) (request for service date and
lowest transportation type); Natural Gas Pipeline Company of
America, Sixth Rev. Vol. No. 1, Original Sheet No. 237, General
Terms and Conditions, Section 5.7(c)(1)(ii) (request for service
date); Northwest Pipeline Corporation, Third Rev. Vol No. 1,
Original Sheet Nos. 219-221, General Terms and Conditions, Section
12 (contract execution date, request for service date, or date gas
first tendered, if gas not tendered within 15 days of applicable
date); Panhandle Eastern Pipe Line Company, First Rev. Vol. No. 1,
Original Sheet No. 243, General Terms and Conditions, Section 8.9
(rate schedule and service request date); Tennessee Gas Pipeline
Company, Fifth Revised Volume No. 1, Original Sheet No. 317, General
Terms and Conditions, Section 5 (supply and market rankings).
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Accordingly, the Commission will revise the regulations to better
fit the current need for contract information and to reduce the
reporting burden on the pipelines. Those pipelines that continue to
rely upon contract execution dates, service request dates, or other
data to allocate firm or interruptible capacity must maintain (for both
affiliate and non-affiliate shippers) a log of those contract dates or
other information used to allocate capacity.55
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\5\5This log will consist of shipper name (including a
designation whether the shipper is a local distribution company, an
interstate pipeline, an intrastate pipeline, an end-user, a
producer, or a marketer), the shipper's affiliation with the
pipeline, contract number, and the relevant dates or other data used
for capacity allocation. The other data, for example, may include
rate schedule, transportation type, or other ranking criteria used
to establish service priority.
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The pipelines must post on their EBBs the current relevant capacity
allocation data for their affiliates.56 This posting is equivalent
to the current requirement to post transportation request information,
and will enable shippers to monitor the pipelines' allocation of
capacity to their affiliates. The posting of the information must
conform with the requirements applicable to pipelines' EBBs as required
in Sec. 284.8(b)(4).57 The pipelines also must provide the full
capacity allocation log (for affiliates and non-affiliates) to the
Commission upon request, within a reasonable time and must make it
available pursuant to the Commission's discovery procedures, 18 CFR,
Part 385, Subpart D.58
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\5\6As contracts expire or allocation data is revised, the
pipelines should remove the outdated data from the EBB posting. The
pipelines, however, are still required to maintain the historical
data for three years so it can be provided to the Commission if
needed.
\5\7The requirements for EBB access to this information are
discussed at the text accompanying note 65, infra.
\5\8In the Commission's EBB standard-making proceeding in Docket
No. RM93-4-000, the industry Working Groups proposed to develop an
Index of Purchasers to reflect firm and interruptible contract
information. The Commission found this proposal had significant
merit and directed the industry to work to develop a final proposal
by September 30, 1994. See Order No. 563-A, III FERC Stats. & Regs.
Preambles, at 31,047. Ultimately, when the Index of Purchasers is
developed, the contract information required here could be included
in the Index.
---------------------------------------------------------------------------
The Commission is deleting the requirements to post complaints and
tariff waivers. If a complaint is not handled by the pipeline to the
satisfaction of the complaining party, the complainant can bring the
matter to the Commission either through the Commission's Enforcement
Task Force hotline or the Commission's formal complaint procedures. In
addition, if shippers have questions about tariff waivers, the ability
to obtain such information under former Standard L (new Standard K) is
sufficient.
Indicated Parties support continuation of the current requirement
to disclose the maximum daily quantity of gas to be transported under a
contract and contend the requirement should be expanded to include the
receipt and delivery points under the contract. The Commission,
however, does not find that continued disclosure of this information is
necessary. Information on maximum daily quantities under each contract
is already available for all shippers in the initial reports that
pipelines must file under Part 284.59 Such information does not
appear so critical to capacity allocation that a duplicative reporting
requirement for affiliate transactions should be imposed.60
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\5\918 CFR 284.106.
\6\0The same information also would be provided under the Index
of Purchasers proposal in the EBB rulemaking proceeding. Order No.
563-A, III FERC Stats. & Regs. Preambles, at 31,047.
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B. Discount Information for Affiliate and Non-Affiliate Transactions
The current Sec. 250.16 regulations require pipelines to disclose
affiliate discounts on their EBB and to maintain non-affiliate
information, which will be provided to the Commission, upon request. As
discussed earlier, the Commission is deleting the requirement for
pipelines to post affiliate information on their EBBs, because the
pipelines contemporaneously post affiliate discount information under
Standard H.
A number of commenters contend the Commission should eliminate the
reporting requirements entirely. Tenneco maintains that the reporting
requirements are not needed to monitor or prevent abuse, because
sufficient information about the processing of transportation requests
and rates is maintained by the pipelines and would be available if
allegations of undue discrimination are made. It states permanent data
collection and posting requirements should not be imposed based on
unsubstantiated suspicions that abuses will occur in the post Order No.
636 environment. Several commenters argue the Order No. 497
requirements are duplicative of the requirement in Sec. 284.7(d)(5)(iv)
that pipelines file discount information with the Commission.61
Natural argues that since the Commission found the Part 284 reporting
requirements to be sufficient for firm service, these requirements
similarly should be sufficient for interruptible service. Columbia
argues that, like the allocation of firm capacity, the allocation of
interruptible capacity on its system takes place during the nominating/
bidding process conducted through and disclosed on its EBB, and
therefore no separate Order No. 497 posting requirement is needed.
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\6\1Columbia, KGPC, Natural, Tenneco.
---------------------------------------------------------------------------
The Commission will retain the requirement for pipelines to
maintain discount information for affiliates and non-affiliates and
provide that information to the Commission upon request. Information on
discounting is needed for the Commission to monitor affiliate
transactions, and this information is not duplicated elsewhere.62
The information required in Sec. 250.16 is more extensive than the
discount information required to be filed under Part 284. For example,
the discount information under Sec. 250.16 includes the quantity of gas
scheduled at the discount for each delivery point, which is not
included in the Part 284 reports. The Commission requires the more
detailed information to adequately monitor and compare affiliate and
non-affiliate transactions.63
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\6\2Most pipelines do not provide public access to the details
of their interruptible discounts on their EBBs. If Columbia believes
that its EBB currently would provide the Commission with the
required information about affiliate and non-affiliate discounts
required in this rule, it may seek a waiver of the reporting
requirements.
\6\3See Order No. 497, FERC Stats. & Regs. [Regulations
Preambles 1986-1990] at 31,147. For example, the actual quantity
information can be used to determine revenues received from
affiliate and non-affiliate transactions. Such information is needed
to monitor transactions and is also needed to properly evaluate the
throughput adjustments pipelines propose in rate cases to reflect
transportation discounts.
---------------------------------------------------------------------------
Accordingly, the Commission will continue to require pipelines to
maintain discount information for both affiliate and non-affiliate
transactions. They must provide this information to the Commission upon
request, within a reasonable time, according to specifications and
formats prescribed by the Commission in Form No. 592.64
---------------------------------------------------------------------------
\6\4The information also must be made available under the
Commission's discovery procedures.
---------------------------------------------------------------------------
The Commission had proposed to eliminate the requirement for the
pipelines to provide the discount information for firm capacity,
stating that, under Order No. 636, much of the posting and awarding of
firm service by the pipelines will take place on the pipelines' EBBs.
The Commission, however, has reconsidered and will continue the current
requirement that pipelines include firm discount information in the
data to be made available to the Commission. First, after review of
pipeline tariffs, the Commission is not sure that all pipelines will be
posting the details of their sales of firm capacity on their EBBs.
Second, including firm discounts in this data will enable Commission
staff to process the information more easily, because all relevant
discount information will be provided in one format.
IX. EBB Access and Archiving Requirements
Under Standard H, pipelines will be posting information related to
affiliate discount offers on their EBBs and, under Sec. 250.16(c), they
also will be posting the affiliate contract allocation data on their
EBBs. In the NOPR, the Commission proposed to conform the Order No. 497
EBB posting requirements with the EBB requirements under Part 284, and
the Commission is adopting this approach.
The pipelines, therefore, must ensure that the affiliate
information is displayed in a user-friendly format and that their EBB
incorporates the same features as apply to the other aspects of the
pipelines' EBBs.65 The protocols and procedures for accessing the
affiliate information also must be the same as those used to access
each pipeline's EBB. Thus, the pipelines must permit users to obtain
the affiliate information by using the same phone number and log-on
procedures used to access the information about available capacity on
the pipelines' EBBs.66
---------------------------------------------------------------------------
\6\5See Order No. 636, III FERC Stats. & Regs. Preambles at
30,415. For example, the requirements to provide information through
downloadable files, to provide on-line help, search functions, and
menus, and to provide for backing-up, archiving, and retrieval of
this material would be the same as those for the capacity
availability information posted pursuant to Sec. 284.8(b)(4).
\6\6For example, the Commission envisions that, in most cases,
the Order No. 497 information would be a separate menu item that
users could choose when they log-on to the pipeline's EBB.
---------------------------------------------------------------------------
Columbia and Texas Gas contend that pipelines should be permitted
to post the affiliate information in a manner consistent with their EBB
formats and not be required to adhere to the Form No. 592 formats.
Hadson contends the Commission should continue to require a hard copy
filing of the Form No. 592 information with the Commission, because
many pipelines' Order No. 497 boards are so poorly designed that
shippers experience difficulty in accessing and abstracting useful
information.
Form No. 592 is not intended to dictate the mode of displaying
information on EBBs, but to provide the requirements for providing
information to the Commission electronically. The EBB regulations
require the pipelines to display information in a user-friendly format
and pipelines, therefore, are responsible for developing a user-
friendly display for the affiliate information posted on their EBBs.
Since the Commission has established EBBs as the mode of communication
between pipelines and their customers and the EBBs are required to be
user-friendly, the Commission will not require hard copy filings.
Moreover, any possible benefits from hard copy filing are outweighed by
the filing burden on the pipelines and the administrative burden on the
Commission of collecting and maintaining the hard copy information.
Panhandle Eastern Pipelines contend that integrating the Order No.
497 information into their EBB would be costly and if the Commission
insists on merger of the boards, it suggests the Commission should
provide 9 months within which to do so. The Commission concludes that
integrating the marketing affiliate information required here into the
pipelines' current EBB structure is necessary to ensure shippers can
access the information easily without having to use an entirely
different set of procedures and protocols to view the affiliate
information. In fact, many pipelines already have integrated their
affiliate information with their Order No. 636 EBBs. Pipelines that
cannot accommodate such integration, may file a request for an
extension of time, providing good cause for extending the compliance
deadline.
PG&E requests clarification about the pipelines' obligation to
archive the information required to be posted and maintained under the
rule. It contends the pipelines should be required to maintain the
information for a reasonable period of time, suggesting they archive
the data at least until their next rate case. The EBB posting of
affiliate information must conform with the Commission's requirements
for EBBs.
The current regulations provide that data be maintained consistent
with the Sec. 284.8(b)(4) requirements relating to EBBs, which includes
a three year archiving requirement.67 Thus, all information posted
on EBBs must be archived for three years. Similarly, the three year
maintenance requirement will apply to the information in the log of
contract allocation data, Sec. 250.16(c),68 and the discount data,
Sec. 250.16(d).
---------------------------------------------------------------------------
\6\718 CFR 284.8(b)(4)(ii).
\6\8Pipelines must maintain the log data for each contract as
long as the data is used to allocate capacity and for three years
after the data is no longer used for capacity allocation. For
example, if a contract is terminated or revised, the historical data
about that contract must be maintained for three years.
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X. Miscellaneous Issues
A. Reporting of Affiliate Discounts Under Part 284
Current Sec. 250.16(d)(4)(ii) permitted pipelines filing affiliate
discount reports to exclude those transactions from the discount
reports required to be filed under Sec. 284.7(d)(5)(iv). The Commission
proposed to remove this provision, because, under its proposed
regulations, pipelines would no longer file affiliate reports with the
Commission, but would post them on their EBBs. AER/MRT contend that if
affiliate discounts are posted on the EBB within 15 days of the
transaction, the Part 284 discount reports still should not be
required.
The Commission will require pipelines to file affiliate discounts
under Sec. 284.7(d)(5)(iv), because the Commission is deleting the
requirement to post affiliate discounts under Sec. 250.16. Under
Standard H, pipelines must only post offers of affiliate discounts.
Thus, pipelines must file the affiliate discount information for the
completed transaction under the Part 284 regulations.
B. Relation of the Marketing Affiliate Regulations of This Rule to
Tariff Requirements Addressing Similar Problems
El Paso requests clarification that the Commission's Order No. 497
regulations, as codified in Part 161 and Sec. 250.16 of the
regulations, constitute the exclusive requirements relating to
marketing affiliates superseding any specific tariff provisions related
to affiliate transactions. It asserts that the Commission has in the
past imposed tariff requirements for certain transactions (such as gas
inventory charges or interruptible sales) that were meant to address
problems similar to those addressed in the affiliate provisions. It
maintains that these tariff provisions should be considered inoperative
so all pipelines will be treated equally.
The Commission cannot make a universal determination of the
applicability of all outstanding tariff provisions. The Commission,
however, will carefully review pipeline filings to eliminate any such
provisions the pipelines believe are superfluous in light of the
marketing affiliate requirements.
C. Applicability of the Marketing Affiliate Regulations of This Rule to
Permanent Releases of Capacity
AER/MRT request clarification of whether a permanent release of
capacity will trigger the reporting and maintenance requirements of the
rule. They point to the Commission's finding that the Order No. 497
reporting requirements do not apply to temporary capacity
releases,69 and contend the same treatment should apply to
permanent releases, since permanent releases, like temporary releases,
are controlled not by the pipeline, but by the firm shipper holding
capacity.
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\6\9See Northwest Pipeline Corporation, 65 FERC 61,007 (1993).
---------------------------------------------------------------------------
The Commission does not agree that permanent releases are identical
to temporary releases. In a temporary capacity release, the releasing
shipper is still obligated to the pipeline under its initial contract.
Thus, even if the releasing shipper agrees to accept a discounted rate,
the pipeline has not agreed to the discount because the releasing
shipper will owe the maximum rate under its contract.70 In a
permanent capacity release, however, the releasing shipper's
contractual obligations end, and the replacement shipper enters into a
new contract with the pipeline. Thus, if the pipeline offers a discount
to its affiliate it must post that discount on its EBB under Standard H
and it must maintain the required discount information under
Sec. 250.16.
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\7\0The releasing shipper is entitled to a credit to reflect the
amount bid by the replacement shipper. Of course, if the releasing
shipper's contract with the pipeline involved a discount, that fact
would be disclosed when the contract was consummated.
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D. EBB Posting of Information Constitutes a Filing
Hadson requests clarification that, as stated in Order No. 497-E,
the posting of Order No. 497 information on a pipeline's EBB
constitutes a filing with the Commission for the purposes of 18 U.S.C.
Sec. 1001, which provides criminal penalties for a knowing and willful
misrepresentation to the government.71 The Commission reaffirms
its position in Order No. 497-E that posting of the affiliate
information is deemed to be a filing for purposes of 18 U.S.C.
Sec. 1001.
---------------------------------------------------------------------------
\7\1See Order No. 497-E, III FERC Stats. & Regs. Preambles at
30,990.
---------------------------------------------------------------------------
E. Posting of Pipeline Tariffs
Indicated Parties contend that the pipelines should be required to
post their tariffs. They assert such posting would save shippers as
well as the pipelines considerable time and money as compared with the
current requirement that pipelines make their tariffs available for
public inspection and send copies to shippers. The issue of posting
pipeline tariffs is unrelated to the affiliate regulations and is not
appropriately considered in this proceeding. The issue has been
discussed at some of the conferences in Docket No. RM93-4-000 relating
to standards for EBBs, and that would be a more appropriate forum to
consider this issue.
F. Relationship to the Commission's EBB Standards Proceeding
The National Registry contends that the issues of affiliate
disclosure are related to issues involved in the Commission's ongoing
proceeding, in Docket No. RM93-4-000, to develop standards for
electronic dissemination of information about firm and interruptible
capacity. In particular, the National Registry is concerned about the
disclosure of information relating to the firm and interruptible
capacity rights of shippers, and suggests that the Commission hold a
technical conference to determine how best to provide disclosure of
capacity rights information.
The Commission finds that the issue of disclosure of capacity
rights is properly considered only in the Docket No. RM93-4-000
proceeding. As stated earlier, in Order No. 563-A, the Commission found
merit in the development of an index of capacity rights and directed
the industry to develop a final proposal by September 30, 1994.
XI. Environmental Analysis
The Commission is required to prepare an Environmental Assessment
or an Environmental Impact Statement for any action that may have a
significant adverse effect on the human environment.72 The
Commission has categorically excluded certain actions from these
requirements as not having a significant effect on the human
environment.73 The action taken here falls within the categorical
exclusions provided in the Commission's regulations.74 Therefore,
an environmental assessment is unnecessary and has not been prepared in
this rulemaking.
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\7\2Order No. 486, Regulations Implementing the National
Environmental Policy Act, 52 FR 47897 (Dec. 17, 1987), FERC Stats. &
Regs. Preambles 1986-1990 30,783 (1987).
\7\318 CFR 380.4.
\7\4See 18 CFR 380.4(a)(2)(ii), 380.4(a)(5).
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XII. Regulatory Flexibility Act Certification
The Regulatory Flexibility Act of 1980 (RFA)75 generally
requires a description and analysis of final rules that will have
significant economic impact on a substantial number of small entities.
The regulations impose reporting requirements on interstate natural gas
pipelines. Since these pipelines are not small entities, the
regulations will not have significant economic impact on small
entities. Thus, pursuant to section 605(b) of the RFA, the Commission
hereby certifies that the regulations proposed herein will not have a
significant impact on a substantial number of small entities.
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\7\55 U.S.C. 601-612.
---------------------------------------------------------------------------
XIII. Information Collection Requirement
Office of Management and Budget (OMB) regulations require approval
of certain information collection requirements imposed by agency
rules.76 The final rule revises and reduces the reporting
requirements/burden under existing FERC-592, Marketing Affiliates of
Interstate Pipelines, (OMB Control No. 1902-0157).
---------------------------------------------------------------------------
\7\65 CFR 1320.14.
---------------------------------------------------------------------------
The information required under FERC-592 enables the Commission to
carry out its legislative mandate under the Natural Gas Act and Natural
Gas Policy Act and allows the Commission to review/monitor pipeline
transportation, sales, and storage transactions with its marketing
affiliates to deter undue discrimination and to take appropriate
action, where and when necessary. The information is also used by
others to indicate whether or not there has been discrimination in
pipeline affiliate/non-affiliate transactions.
The Commission is submitting notification of these FERC-592
information requirements to OMB for its review and approval. Interested
persons may obtain further information by contacting the Federal Energy
Regulatory Commission, 941 North Capitol Street NE., Washington, D.C.
20426 [Attention: Michael Miller, Information Services Division, (202)
208-1415]. Comments on the requirements of the subject final rule may
also be sent to the Office of Information and Regulatory Affairs,
Office of Management and Budget, Washington, D.C. 20503 [Attention:
Desk Officer for Federal Energy Regulatory Commission].
XIV. Effective Date
The final rule shall take effect August 1, 1994.
List of Subjects
18 CFR Part 161
Natural gas, Reporting and recordkeeping requirements.
18 CFR Part 250
Natural gas, Reporting and recordkeeping requirements.
18 CFR Part 284
Continental shelf, Natural gas, Reporting and recordkeeping
requirements.
By the Commission. Commissioner Hoecker concurred in part and
dissented in part with a separate statement attached.
Lois D. Cashell,
Secretary.
In consideration of the foregoing, the Commission amends Parts 161,
250, and 284, Chapter I, Title 18, Code of Federal Regulations, as set
forth below.
PART 161--STANDARDS OF CONDUCT FOR INTERSTATE PIPELINES WITH
MARKETING AFFILIATES
1. The authority citation for Part 161 continues to read as
follows:
Authority: 15 U.S.C. 717-717w, 3301-3432; 42 U.S.C. 7101-7352.
2. Section 161.1 is revised to read as follows:
Sec. 161.1 Applicability.
This part applies to any interstate natural gas pipeline that
transports gas for others pursuant to subpart A of part 157 of this
chapter, and subparts B or G of part 284 of this chapter and is
affiliated in any way with a natural gas marketing or brokering entity
and conducts transportation transactions with its affiliate. The
requirements of this part also apply to pipeline sales operating units
to the extent provided in Sec. 284.286 of this chapter.
3. Section 161.2 is revised to read as follows:
Sec. 161.2 Definitions.
(a) Affiliate, when used in reference to any person in this part
and Sec. 250.16 of this chapter means another person which controls, is
controlled by, or is under common control with, such person.
(b) Control (including the terms ``controlling,'' ``controlled
by,'' and ``under common control with'') as used in this part and
Sec. 250.16 of this chapter, includes, but is not limited to, the
possession, directly or indirectly and whether acting alone or in
conjunction with others, of the authority to direct or cause the
direction of the management or policies of a company. A voting interest
of 10 percent or more creates a rebuttable presumption of control.
(c) Marketing or brokering as used in this part and Sec. 250.16 of
this chapter means:
(1) A first sale of natural gas as that term is defined in
Sec. 270.203 of this chapter, or a sale of natural gas in interstate
commerce for resale by a seller that is not an interstate pipeline,
except when:
(i) The first seller is selling gas solely from its own production;
or
(ii) The first seller is selling gas solely from its own gathering
or processing facilities.
(2) An off-system sale by an intrastate natural gas pipeline or a
sale under Sec. 311(b) of the Natural Gas Policy Act as codified in
Sec. 284.142 of this chapter; or
(3) An off-system sale by a local distribution company or a sale
under Sec. 284.224 of this chapter.
(d) Potential shippers, as used in this part and Sec. 250.16 of
this chapter, means all current transportation and sales customers of
an interstate natural gas pipeline, and all persons who have pending
requests for transportation service or for information regarding
transportation service on that pipeline.
(e) Transportation, as used in this part and Sec. 250.16 of this
chapter, includes storage, exchange, backhaul, displacement, or other
methods of transportation.
4. In Sec. 161.3, paragraph (h) is removed, paragraphs (i) through
(l) are redesignated (h) through (k), and redesignated paragraphs (h)
and (i) are revised to read as follows:
Sec. 161.3 Standards of conduct.
* * * * *
(h) If a pipeline offers a transportation discount to a marketing
affiliate, or offers a discount for a transportation transaction in
which an affiliate is involved, the pipeline must, contemporaneously
with the offer:
(1) Post a notice of the offer on its Electronic Bulletin Board,
operated pursuant to Sec. 284.8(b)(4) of this chapter, for a period of
90 days, providing the date of the offer, the discount rate, the
quantity of gas scheduled to be moved at the discounted rate, the
delivery points in the offer, any conditions or requirements applicable
to the offer, and the procedures by which a non-affiliated shipper can
request a comparable offer. The posting must conform with the
requirements of Sec. 284.8(b)(4) of this chapter and the pipeline's
tariff requirements relating to Electronic Bulletin Boards. Access to
the information must be provided using the same protocols and
procedures used for the pipeline's Electronic Bulletin Board.
(2) Provide a comparable discount to all similarly situated non-
affiliated shippers requesting one.
(i) It must file with the Commission procedures that will enable
shippers and the Commission to determine how the pipeline is complying
with the standards in this section.
* * * * *
PART 250--FORMS
1. The authority citation for Part 250 continues to read as
follows:
Authority: 15 U.S.C. 717-717w, 3301-3432; 42 U.S.C. 7101-7352.
2. Sec. 250.16 is revised to read as follows:
Sec. 250.16 Format of compliance plan for transportation services and
affiliate transactions.
(a) Who must comply. An interstate natural gas pipeline that
transports natural gas for others pursuant to Subparts B or G of Part
284 of this chapter and is affiliated, as that term is defined in
Sec. 161.2 of this chapter, in any way with a natural gas marketing or
brokering entity and conducts transportation transactions with its
affiliate must comply with the requirements of this section. The
requirements of this section also apply to pipeline sales operating
units to the extent provided in Sec. 284.286 of this chapter.
(b) Tariff requirements. An interstate pipeline must maintain
tariff provisions containing the following:
(1) A complete list of operating personnel and facilities shared by
the interstate natural gas pipeline and its marketing or brokering
affiliates, which the pipeline must update and refile with the
Commission on a quarterly basis to reflect changes occurring during the
quarter;
(2) The procedures used to address and resolve complaints by
shippers and potential shippers including a provision that the pipeline
will respond within 48 hours and in writing within 30 days to such
complaints.
(c) Log of data used to allocate capacity. (1) An interstate
pipeline that relies upon contract information or other data to
allocate capacity must maintain a log showing, for each transportation
contract (both for marketing affiliates and non-affiliates) on its
system: the shipper's name (including a designation whether the shipper
is a local distribution company, an interstate pipeline, an intrastate
pipeline, an end-user, a producer, a marketer, or a pipeline sales
operating unit); the shipper's affiliation with the pipeline; the
contract number; and the applicable dates or other information used to
allocate capacity under its tariff. The log data relating to each
contract must be maintained as long as the contract is used to allocate
capacity and for three years after the contract data is no longer used
for capacity allocation.
(2) The current log of allocation data for marketing affiliates
must be posted on the pipeline's Electronic Bulletin Board, operated
pursuant to Sec. 284.8(b)(4) of this chapter. The posting must conform
with the requirements of Sec. 284.8(b)(4) of this chapter and the
pipeline's tariff requirements relating to Electronic Bulletin Boards.
Access to the information must be provided using the same protocols and
procedures used for the pipeline's Electronic Bulletin Board.
(3) The log of affiliate and non-affiliate information must be
provided to the Commission upon request and must be made available to
the public under Subpart D of Part 385 of this chapter. When requested
by the Commission, the information must be provided, within a
reasonable time, according to the specifications and format contained
in Form No. 592, which can be obtained at the Federal Energy Regulatory
Commission, Public Reference and Files Maintenance Branch, 941 North
Capitol St., N.E., Washington, DC 20426.
(d) Transportation Discount Information. (1) A pipeline that
provides transportation service at a discounted rate must maintain, for
each billing period, the following information: the name of the shipper
being provided the discount (including a designation whether the
shipper is a local distribution company, an interstate pipeline, an
intrastate pipeline, an end-user, a producer, a marketer, or a pipeline
sales operating unit); the affiliate relationship between the pipeline
and the shipper; the affiliate's role in the transportation transaction
(i.e., shipper, marketer, supplier, seller); the duration of the
discount; the maximum rate or fee; the rate or fee actually charged
during the billing period; and the quantity of gas scheduled at the
discounted rate during the billing period for each delivery point. The
discount information with respect to each transaction must be
maintained for three years from the date the transaction commences.
(2) The discount information must be made available to the
Commission upon request and to the public under Subpart D of Part 385
of this chapter. When requested by the Commission, the information must
be provided, within a reasonable time, according to the specifications
and format contained in Form No. 592, which can be obtained at the
Federal Energy Regulatory Commission, Public Reference and Files
Maintenance Branch, 941 North Capitol Street, NE., Washington, DC
20426.
(e) Penalty for failure to comply. (1) Any person who transports
gas for others pursuant to Subparts B or G of Part 284 of this chapter
and who knowingly violates the requirements of Sec. 161.3, Sec. 250.16,
or Sec. 284.13 of this chapter will be subject, pursuant to sections
311(c), 501, and 504(b)(6) of the Natural Gas Policy Act of 1978, to a
civil penalty, which the Commission may assess, of not more than $5,000
for any one violation.
(2) For purposes of this paragraph, in the case of a continuing
violation, each day of the violation will constitute a separate
violation.
PART 284--CERTAIN SALES AND TRANSPORTATION OF NATURAL GAS UNDER THE
NATURAL GAS POLICY ACT OF 1978 AND RELATED AUTHORITIES
1. The authority citation for Part 284 continues to read as
follows:
Authority: 15 U.S.C. 717-717w, 3301-3432; 42 U.S.C 7101-7532; 43
U.S.C 1331-1356.
2. In Sec. 284.286, paragraph (c) is revised to read as follows:
Sec. 284.286 Standards of conduct for unbundled sales services.
* * * * *
(c) The pipeline must comply with Secs. 161.3 (a), (b), (d), and
(k) of this chapter and comply with Secs. 161.3 (c), (e), (f), (g), and
(h) of this chapter by considering its unbundled sales operating
employees as an operational unit which is the functional equivalent of
a marketing affiliate.
* * * * *
Note--The following appendix will not appear in the Code of
Federal Regulations.
Appendix A--Parties Filing Comments on the Notice of Proposed Rulemaking
[Docket No. RM94-6-000]
------------------------------------------------------------------------
Commenter Abbreviation
------------------------------------------------------------------------
ANR Pipeline Company and Colorado ANR/CIG.
Interstate Gas Company.
Arkla Energy Resources Company and AER/MRT.
Mississippi River Transmission
Corporation.
Columbia Gas Transmission Corporation Columbia.
and Columbia Gulf Transmission Company.
CNG Transmission Corporation............ CNG (filed one day late).
El Paso Natural Gas Company............. El Paso.
Enron Interstate Pipelines (Northern Enron pipelines.
Natural Gas Company, Transwestern
Pipeline Company, and Florida Gas
Transmission Company).
Exxon Corporation....................... Exxon.
Hadson Gas Systems, Inc................. Hadson.
Indicated Parties\77\................... Indicated parties.
Interstate Natural Gas Association of INGAA.
America.
K N Energy, Inc......................... K N Energy.
Koch Gateway Pipeline Company........... KGPC.
National Fuel Gas Supply Corporation.... National.
National Registry of Capacity Rights.... National Registry.
Natural Gas Pipeline Company of America. Natural.
Pacific Gas and Electric Company........ PG&E.
Panhandle Eastern Pipe Line Company, Panhandle Eastern Pipelines.
Texas Eastern Transmission Corporation,
Trunkline Gas Company, and Algonquin
Gas Transmission Company.
Questar Pipeline Company................ Questar.
Tenneco Gas............................. Tenneco.
Texas Gas Transmission Corporation...... Texas Gas.
Transcontinental Gas Pipe Line TGPL.
Corporation.
Williams Gas Marketing Company.......... WGM.
Williams Natural Gas Company and WNG/Northwest.
Northwest Pipeline Corporation.
------------------------------------------------------------------------
\77\Conoco, Inc., Amoco Production Company, Anadarko Petroleum
Corporation, Marathon Oil Company, Mobil Natural Gas, Inc., Natural
Gas Clearinghouse, Pennzoil Exploration and Production Company,
Pennzoil Petroleum Company, Pennzoil Gas Marketing Company, Phillips
Petroleum Company, and Union Pacific Fuels, Inc.
Note--The following appendix will not appear in the Code of
Federal Regulations.
Apendix B
Docket No. RM94-6-000
Form Approved
OMB No. 1902-0157
FERC Form No. 592
Marketing Affiliates of Interstate Pipelines
Record Formats
(Revised June 17, 1994)
Public reporting burden for this collection of information is
estimated to average 58 hours per year per respondent, including the
time for reviewing instructions, searching existing data sources,
gathering and maintaining the data needed, and completing and
reviewing the collection of information. Send comments regarding
this burden estimate or any other aspect of this collection of
information, including suggestions for reducing the burden, to each
of the following:
Michael Miller, Federal Energy Regulatory Commission, 825 North
Capitol Street NE., Washington, DC 20426;
Office of Information and Regulatory Affairs, Office of Management
and Budget, Washington, DC 20503, Attention: Desk Officer for the
Federal Energy Regulatory Commission
Table of Contents
General Information
I Purpose
II Who must Comply
III How to Comply
IV Where to Submit
General Instructions
Schedules: Marketing Affiliates of Interstate Pipelines
(1) Discounted Transportation (Storage) Transaction Record
(2) Capacity Allocation Log Record
(3) The Footnotes Record
General Information
I. Purpose
The information required is to support the monitoring of
activities of pipeline marketing affiliates (which includes holders
of Subpart J of Part 284 blanket sales certificates) so as to deter
undue discrimination by pipeline companies in favor of marketing
affiliates, and to prevent any harassment of non-affiliates.
II. Who Must Comply
An interstate natural gas pipeline that:
Transports natural gas for others, as that term is
defined in 18 CFR Sec. 161.2, pursuant to Subparts B or G of Part
284 of 18 CFR Chapter I and
Is affiliated, as that term is defined in Sec. 161.2 of
this chapter, in any way with a natural gas marketing or brokering
entity and
Conducts transportation transactions with its affiliate
must maintain the requisite information for transportation service
as specified in the FERC Form 592 and in the manner prescribed
herein. The requirements of this part also apply to pipeline sales
operating units to the extent provided in Sec. 284.286 of this
chapter.
III. How to Comply
An interstate pipeline must maintain the required information
for both firm and interruptible transportation service, and for both
pipeline affiliates and nonaffiliates, in a computer file(s)
conforming to the file formats specified in the FERC Form 592.
Pipelines may submit the FERC Form 592 computer file(s) on 9-track
tape reel(s), 18-track tape cartridge(s), or on computer
diskette(s). In addition, the Commission may request that the
pipeline provide one paper copy of the information submitted in the
computer file(s) so as to assist Commission staff in interpreting
the computer file(s).
IV. Where to Submit
(1) Upon request by the Commission, submissions should be
addressed to: Office of the Secretary, Federal Energy Regulatory
Commission, 825 N. Capitol Street NE., Washington, DC 20426.
(2) Hand deliveries can be made to: Office of the Secretary,
Federal Energy Regulatory Commission, Room 3110, 825 N. Capitol
Street NE., Washington, DC 20426.
General Instructions
1. The notation f(m,n) will be used to denote a numeric string
of length ``m'' including a decimal (``.'') with ``n'' digits
following the decimal.
2. In preparing the required flat file, the following
conventions must be followed:
(A) All volumetric data should be stated in MMbtu's (rounded to
the nearest MMbtu), except where noted.
(B) All rates should be stated in cents per MMbtu fixed decimal
numbers, format f(10,2). For example, $1.5264/MMbtu should be stated
as 152.64.
(C) Negative values should be reported with a ``-'' sign
preceding the first nonzero digit reported.
(D) Commas must not be included in any numeric field.
(E) All dates should be reported as six digit numerics (month,
day, year), unless otherwise indicated.
3. The sequence number is the sequential number assigned to a
record as it is recorded on a schedule/record. The sequence number
is incremented as additional records are added to a schedule/record
and will be between 1 and 999,999, inclusive. (Note: the sequence
number should be right justified, zero filled.)
4. The reference number is the alphanumeric string formed by
concatenation of the Schedule ID, sequence number, and beginning
character position of the item footnoted. E.g., a respondent's
Company ID reported in the Discounted Transportation (Storage)
Transaction Record would have reference number ``D000001008'' formed
by joining (concatenating) the schedule ID ``D'', the sequence
number ``000001'', and the beginning character position of the item
``008''.
5. Record any footnote relative to any recorded item in the
``Footnotes Record'', schedule ID `F'. Each footnote should be cross
referenced to the schedule and record (line) it pertains to by the
appropriate reference number (see above).
6. Source of Codes.
(A) Pipeline Company ID--Use the code for the pipeline as
contained in the Buyer Seller Code List, U.S. Department of Energy's
publication DOE/EIA-0176. A code may be obtained by calling EIA at
(202) 254-5435.
(B) Contract ID--The respondent's own designation for the
contract or agreement covering the transaction being reported. This
identifier will either be assigned by the respondent or the party
providing a service to the respondent.
7. A pipeline blanket sales operating unit is any entity
operating under a Subpart J of Part 284 blanket sales certificate,
and is considered the functional equivalent of a marketing
affiliate.
8. Delivery Point ID--The point at which the pipeline company
delivers the natural gas to a designated end user, local
distribution company, etc. as specified by the transportation
service requested. The respondent will provide a unique 20-byte
alphanumeric identifier for each delivery point on his pipeline
system. This delivery point ID will be the alphanumeric label/name
which the respondent uses in conducting his daily business, (or a
unique abbreviation thereof if the company identifier is more than
20 characters in length.)
9. Maximum Rate for Transportation Service--The maximum rate
contained in the respondent's currently effective tariff for the
rate schedule under which the transportation service is being
conducted.
10. Discounted Rate for Transportation Service--A rate that is
less than the maximum rate on file with the Commission.
Schedules
Marketing Affiliates of Interstate Pipelines
Definitions of Items and File Layout for the Marketing Affiliates of
Interstate Pipelines FERC Form No. 592
This form will consist of three record formats:
1. Discounted Transportation (Storage) Transaction Record
2. Capacity Allocation Log Record
3. Footnotes Record
Discounted Transportation (Storage) Transaction Record
[Instructions: This record is maintained for each delivery point actually used during the billing period
recorded. Only transportation transactions actually discounted should be recorded]
----------------------------------------------------------------------------------------------------------------
Item Character
No. Item position Data type Comments
----------------------------------------------------------------------------------------------------------------
1.... Schedule ID........................ 1 Character....... Enter `D'.
2.... Sequence number.................... 2-7 Numeric......... Right justified, zero filled, see
general instruction 3.
3.... Company ID......................... 8-13 Numeric......... Reporting pipeline code, from buyer/
seller code list, see general
instruction 6(A).
4.... Contract ID........................ 14-21 Character....... See general instruction 6(B).
5.... Shipper............................ 22-61 Character....... Name of the shipper receiving service.
6.... Pipeline affiliation with shipper.. 62 Character....... Code=Y, respondent affiliated with
shipper;
Code=N, respondent not affiliated with
shipper.
7.... Shipper type....................... 63 Character....... Code=1, LDC/distributor;
Code=2, interstate pipeline;
Code=3, intrastate pipeline;
Code=4, end user;
Code=5, producer;
Code=6, marketer;
Code=7, pipeline sales operating unit;
Code=8, other, (specify in footnote).
8.... Affiliate name..................... 64-103 Character....... name of the pipeline affiliate involved
in the transportation/storage service
being provided; if more than one
affiliate is involved in the service,
provide name(s) in a footnote
9.... Role of affiliate.................. 104 Character....... Affiliates role in the transportation/
storage service is:
Code=1, shipper;
Code=2, marketer;
Code=3, supplier;
Code=4, seller;
Code=5, buyer;
Code=6, agent;
Code=7, end user;
Code=8, no affiliate involved
Code=9, other, (identify role in a
footnote).
10... Is affiliate a pipeline blanket 105 Character....... Code=Y, yes;
sales operating unit of the Code=N, no.
Respondent?.
11... Type of service.................... 106-107 Character....... Code=FT, firm transportation;
Code=IT, interruptible transportation;
Code=SC, storage capacity;
Code=SI, storage injection;
Code=SW, storage; withdrawal.
12... Delivery point ID.................. 108-127 Character....... See general instruction 8
13... Billing period start date.......... 128-133 Numeric......... (mmddyy) month, day, and year for start
of billing period
14... Billing period end date............ 134-139 Numeric......... (mmddyy) month, day, and year for end
of billing period
15... Duration of discount............... 140-141 Numeric......... number of days in the billing period
the discount was provided
16... Maximum rate for transportation 142-151 Numeric......... (cents/MMbtu); maximum effective rate/
service. fee currently on file with the
Commission for the service provided;
format f(10,2); e.g., 35.62 cents is
reported as ``35.62''; see general
instruction 9.
17... Discounted rate for transportation 152-161 Numeric......... (cents/MMbtu); actual rate/fee
service. collected for the transportation
service rendered; format f(10,2);
e.g., 32.15 cents is reported as
``32.15''; do not report a negative
value; see general instruction 10.
18... Volume transported................. 162-172 Numeric......... (MMbtu); volume of gas transported at
the discounted rate.
19... Footnote........................... 173 Character....... Code=Y, footnote is provided for this
record;
Code=N, no footnote provided.
----------------------------------------------------------------------------------------------------------------
Capacity Allocation Log Record
----------------------------------------------------------------------------------------------------------------
Item Character
No. Item position Data type Comments
----------------------------------------------------------------------------------------------------------------
1.... Schedule ID........................ 1 Character....... Enter `C'.
2.... Sequence Number.................... 2-7 Numeric......... Right justified, zero filled, see
general instruction 3.
3.... Company ID......................... 8-13 Numeric......... Reporting pipeline code, from buyer/
seller code list, see general
instruction 6(A).
4.... Contract ID........................ 14-21 Character....... See general instruction 6(B).
5.... Shipper............................ 22-61 Character....... Name of the shipper receiving service.
6.... Pipeline affiliation with shipper.. 62 Character....... Code=Y, respondent affiliated with
shipper;
Code=N, respondent not affiliated with
shipper.
7.... Shipper type....................... 63 Character....... Code=1, LDC/distributor;
Code=2, interstate pipeline;
Code=3, intrastate pipeline;
Code=4, end user;
Code=5, producer;
Code=6, marketer;
Code=7, pipeline sales operating unit;
Code=8, other, (specify in footnote).
8.... Type of service.................... 64-65 Character....... Code=FT, firm transportation;
Code=IT, interruptible transportation;
Code=SC, storage capacity'
Code=SI, storage injection;
Code=SW, storage withdrawal.
9.... Text............................... 66-197 Character....... Enter the applicable dates or other
information used to allocate capacity.
10... Footnote........................... 198 Character....... Code=Y, footnote is provided for this
record;
Code=N, no footnote provided.
----------------------------------------------------------------------------------------------------------------
The Footnotes Record
----------------------------------------------------------------------------------------------------------------
Item Character
No. Item position Date type Comments
----------------------------------------------------------------------------------------------------------------
1.... Schedule ID........................ 1 Character....... Enter `F'.
2.... Sequence Number.................... 2-7 Numeric......... Right justified, zero filled, see
general instruction 3.
3.... Company ID......................... 8-13 Numeric......... Reporting pipeline code, from buyer/
seller code list, see general
instruction 6(A).
4.... Reference Number................... 14-23 Numeric......... Reference number for record being
footnoted. See general instruction 4.
5.... Footnote Text...................... 24-155 Character.......
----------------------------------------------------------------------------------------------------------------
Standards of Conduct and Reporting Requirements for Transportation and
Affiliate Transactions--Docket No. RM94-6-000
(Issued June 17, 1994)
Hoecker, Commissioner, concurring in part and dissenting in part:
Today I concur that the time has come to cut the regulatory
burden associated with the marketing affiliate rules, particularly
the filing and record maintenance requirements tentatively adopted
six years ago to ensure an equitable transition to competition among
independent and pipeline-affiliated marketers. My colleagues and I
disagree only in part and that disagreement is surely a matter of
degree, not principle.
I support the retention of the modestly revised Standards of
Conduct applicable to pipeline relationships with marketing
affiliates because, under these circumstances, they impose a useful
and relatively light-handed transactional discipline on these
relationships and help guarantee fair play and equal information in
the marketplace.
I nevertheless think the retention of the reporting and records
maintenance requirements in revised FERC Form No. 592 is excessive
and unnecessary.1 I am inclined to think it demonstrates an
unhappy tendency to which we all occasionally fall prey in a
bureaucratic culture: assumptions and requirements, once adopted,
tend to perpetuate themselves beyond their useful lives. As Vice
President Gore's National Performance Review observes:
---------------------------------------------------------------------------
\1\FERC Form No. 592 is codified in section 250.16 of the
Commission's regulations. If this form were eliminated, I believe
certain of the other requirements contained in section 250.16 (such
as the requirement to include specified information in the tariff)
could be transferred to the Standards of Conduct to allow for
complete recision of section 250.16.
---------------------------------------------------------------------------
The federal government does at least one thing well: It
generates red tape. But not one inch of that red tape appears by
accident. In fact, the government creates it all with the best of
intentions. It is time now to put aside our reverence for those good
intentions and examine what they have created--a system that makes
it hard for our civil servants to do what we pay them for, and
frustrates taxpayers who rightfully expect their money's
worth.2
---------------------------------------------------------------------------
\2\Creating a Government that Works Better & Costs Less, Report
of the National Performance Review, 1993, p. 11.
---------------------------------------------------------------------------
This might strike my readers as rhetorical overkill as applied
to this case, given the best of intentions that underlies today's
decision to retain the reporting requirements and FERC Form No. 592.
After all, the rule claims (somewhat inexplicably) that on average
they will require only 60 workhours from each company per year. Yet,
the continuation of these recordkeeping requirements is not, in my
estimation, supported by any strong evidence of need. I find no
significant numbers or patterns of complaints alleging that
pipelines have favored affiliates. There is virtually no evidence of
industry interest in these data. In fact, in one of the few
pleadings in this case that offers more than opinion, a major
pipeline system indicates that its Order No. 497 log was accessed
only an average of 2-3 times monthly since 1990, with a significant
portion of those calls (up to 50 percent at times) coming from
Commission staff. The rule was not designed to generate discounting
data for rate cases. Nor was it formulated as a device to obviate
discovery in rare complaint cases. The need for these data is,
therefore, highly conjectural.
In the final analysis, it is clear that the majority wants to
retain this small part of the Code of Federal Regulations ``just in
case.'' And, by eliminating the sunset date, it is likely that FERC
Form No. 592 will linger in regulatory perpetuity. In my opinion,
the cost (however small) to the industry and ultimately to
ratepayers of continuing any part of this recordkeeping requirement
is greater than any probable benefit.
Therefore, I dissent from that aspect of the rule that continues
FERC Form No. 592.
James J. Hoecker,
Commissioner.
[FR Doc. 94-15372 Filed 6-24-94; 8:45 am]
BILLING CODE 6717-01-P
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.