Regulations for Filing Applications for Permits to Site Interstate Electric Transmission Facilities

Federal RegisterDec 1, 2006

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Parts 50 and 380

[Docket No. RM06-12-000; Order No. 689]

Regulations for Filing Applications for Permits to Site Interstate Electric Transmission Facilities

Issued November 16, 2006.

AGENCY:

Federal Energy Regulatory Commission, DOE.

ACTION:

Final rule

SUMMARY:

The Federal Energy Regulatory Commission (Commission) is implementing new regulations in accordance with section 1221 of the Energy Policy Act of 2005 to establish filing requirements and procedures for entities seeking to construct electric transmission facilities. The regulations will coordinate the processing of Federal authorizations and environmental review of electric transmission facilities in national interest transmission corridors.

DATES:

Effective Date:

This rule will become effective February 2, 2007.

FOR FURTHER INFORMATION CONTACT:

John Schnagl, Office of Energy Projects, Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426. (202) 502-8756.

john.schnagl@ferc.gov.

Carolyn Van Der Jagt, Office of the General Counsel, Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426. (202) 502-8620.

carolyn.VanDerJagt@ferc.gov.

SUPPLEMENTARY INFORMATION:

TABLE OF CONTENTS

Paragraph

numbers

I. Background

II. Discussion

A. National Interest Transmission Corridors

B. Permit Findings

1. Commission Jurisdiction under 216(b)(1)

a. One Year Clock/Pre-filing

b. Withholding/Conditioning Approval

c. Other Jurisdictional Issues

2. Other Findings under 216(b)(2) through (6)

C. Project Participation

1. Landowners

2. Stakeholders and Notification

3. Document Availability

4. Participation Process

D. Pre-filing

1. Initial Consultation Issues

2. Third-party Contractors

100

3. Subsequent Filing Requirements

103

4. Lead Agency Issues/Coordinating Federal Permits

105

5. Timeframe for Pre-filing

112

6. Review of Director's Decisions in Pre-filing

116

E. Application Requirements

118

F. Filing Requirements

120

1. State Record

122

2. Exhibits

126

a. Exhibit E—Maps

129

b. Exhibit F—Environmental Requirements

130

i. Section 380.5-Actions that Require EAs

134

ii. Section 380.6 Actions that Require EISs

135

iii. Section 380.10—Participation in Commission Proceeding

137

iv. Resource Report 1—General Requirements

138

v. Resource Report 2—Water Use and Quality

142

vi. Resource Report 3-Fish, Wildlife, and Vegetation

144

vii. Resource Report 4—Cultural Resources

146

viii. Resource Report 5—Socioeconomics

150

ix. Resource Report 6—Geological Resources

159

x. Resource Report 7—Soils

160

xi. Resource Report 8—Land Use, Recreation, and Aesthetics

162

xii. Resource Report 9—Alternatives

175

xiii. Resource Report 10—Reliability and Safety

180

xiv. Resource Report 11—Design and Engineering

182

c. Exhibit G—Engineering Data

185

d. Exhibit H—System Analysis Data

188

e. Exhibit I—Project Cost and Financing

192

G. Critical Energy Infrastructure Information

194

H. Accepting/Rejecting Applications

198

I. Hearings

199

J. Permit Conditions

204

K. State and Local Permits

213

L. Subsequent Modifications to Facilities

219

M. Definitions

221

N. Eminent Domain Issues

225

O. Filing Fees/Funding

228

P. Technical Conferences

229

III. Information Collection Statement

231

IV. Environmental Analysis

236

V. Regulatory Flexibility Act

237

VI. Document Availability

238

VII. Effective Date and Congressional Notification

241

Before Commissioners: Joseph T. Kelliher, Chairman; Suedeen G. Kelly, Marc Spitzer, Philip D. Moeller, and Jon Wellinghoff.

1. On June 16, 2006, the Federal Energy Regulatory Commission (Commission) issued a Notice of Proposed Rulemaking (NOPR) in this proceeding.

In the NOPR, the Commission proposed regulations in accordance with section 1221 of the Energy Policy Act of 2005 (EPAct 2005)

to implement filing requirements and procedures for entities seeking permits to construct or modify electric transmission facilities under the circumstances set forth in that section. This Final Rule considers comments submitted in response to the NOPR, and as a result, makes various modifications to the regulatory text described in the NOPR. Following the issuance of this rule, we will convene regional conferences to assist stakeholders in its implementation.

71 FR 36258 (June 26, 2006); FERC Stats. & Regs. ¶ 32,605 (2006).

Pub. L. 109-58, 119 Stat. 594 (2005).

I. Background

2. On August 8, 2005, EPAct 2005 became law. Section 1221 of EPAct 2005 adds a new section 216 to the Federal Power Act (FPA), providing for Federal siting of electric transmission facilities under certain circumstances.

3. New FPA section 216 requires that the Secretary of the Department of Energy (DOE or Secretary) identify transmission constraints. It mandates that the Secretary conduct a study of electric transmission congestion within one year of enactment and every three years thereafter, and that the Secretary then issue a report. The Secretary is further empowered to designate certain constrained areas as national interest electric transmission corridors (National Corridors).

4. FPA section 216(b) provides that the Commission may issue permits to construct or modify electric transmission facilities in a National Corridor under certain circumstances. The Commission has the authority to issue permits to construct or modify electric transmission facilities if it finds that: (1) A State in which such facilities are located does not have the authority to approve the siting of the facilities or to consider the interstate benefits expected to be achieved by the construction or modification of the facilities; (2) the applicant is a transmitting utility but does not qualify to apply for siting approval in the State because the applicant does not serve end-use customers in the State; or (3) the State commission or entity with siting authority withholds approval of the facilities for more than one year after an application is filed or one year after the designation of the relevant national interest electric transmission corridor, whichever is later, or the State conditions the construction or modification of the facilities in such a manner that the proposal will not significantly reduce transmission congestion in interstate commerce or is not economically feasible.

Under FPA section 216(i)(4), the Commission may not issue a permit for facilities within a State that is a party to an interstate compact establishing a regional transmission siting agency unless the members of the compact are in disagreement and the Secretary of the Department of Energy makes certain findings.

5. Additionally, under FPA sections 216 (b)(2) through (6), before issuing a permit the Commission must find that the proposed facility: (1) Will be used for the transmission of electric energy in interstate commerce; (2) is consistent with the public interest; (3) will significantly reduce transmission congestion in interstate commerce and protect or benefit consumers; (4) is consistent with sound national energy policy and will enhance energy

independence; and (5) will maximize, to the extent reasonable and economical, the transmission capabilities of existing towers or structures.

6. New FPA section 216(h)(2) designates DOE as lead agency to coordinate all Federal authorizations needed to construct proposed electric transmission facilities in National Corridors. Under FPA section 216(h)(4)(A), to ensure timely efficient reviews and permit decisions, DOE is required to establish prompt and binding intermediate milestones and ultimate deadlines for all Federal reviews and authorizations required for a proposed electric transmission facility.

Section 216(h)(5)(A) of the FPA requires that DOE as lead agency, in consultation with the other affected agencies, prepare a single environmental review document that would be used as the basis for all decisions for the proposed projects under Federal law.

Under FPA section 216(h)(6)(A), if any agency has denied a Federal authorization required for a transmission facility, or has failed to act by the deadline established by the Secretary, the applicant or any State in which the facility would be located may file an appeal with the President.

7. On May 16, 2006, the Secretary delegated paragraphs (2), (3), (4)(A)-(B), and (5) of FPA section 216(h) to the Commission as they apply to proposed facilities in designated National Corridors for which an application for authority to construct has been submitted to the Commission.

Specifically, the Secretary delegated to the Commission DOE's lead agency responsibilities for the purpose of coordinating all applicable Federal authorizations and related environmental review and preparing a single environmental review document for facilities falling within the Commission's siting jurisdiction. With respect to such projects, the Commission will establish prompt and binding intermediate milestones and ultimate deadlines for the review, and ensure that all Federal permits are issued, and reviews are completed, within a year or as soon as practicable thereafter.

Department of Energy Delegation Order No. 00-004.00A.

8. On August 8, 2006, DOE issued its National Electric Transmission Congestion Study that examined transmission congestion and constraints and identified affected transmission paths in many areas of the nation.

DOE states that it expects the study to open a dialogue with stakeholders in areas of the Nation where congestion is a matter of concern, focusing on ways in which these problems might be alleviated. DOE states that where appropriate in relation to the congestion areas, it may designate National Corridors.

Department of Energy, National Electric Transmission Congestion Study, Executive Summary (2006),

http://www.oe.energy.gov/energy_policy/epa_sec1221.htm#Timeline

(follow “Congestion Study Executive Summary” hyperlink).

9. Also on August 8, 2006, several Federal agencies including DOE and the Commission entered into a Memorandum of Understanding on Early Coordination of Federal Authorization and Related Environmental Reviews Required in Order to Site Electric Transmission Facilities (MOU).

The purpose of the MOU is to establish a framework for early cooperation and participation that will enhance coordination of all applicable land use authorizations, related environmental, cultural, and historic preservation reviews, and any other approvals that may be required under Federal law in order to site an electric transmission facility.

The other agencies include the Department of Defense, the Department of Agriculture, the Department of the Interior, the Department of commerce, the Environmental Protection Agency, the Council on Environmental Quality, and the Advisory Council on Historic Preservation.

10. FPA section 216(c)(2) requires that the Commission issue rules specifying the form of, and the information to be contained in, an application for proposed construction or modification of electric transmission facilities in National Corridors, and the manner of service of notice of the permit application on interested persons. The Commission is implementing those regulations in a new part 50 of existing subchapter B of its regulations.

II. Discussion

A. National Interest Transmission Corridors

11. As stated, on August 8, 2006, DOE issued its National Electric Transmission Congestion Study and stated that where appropriate in relation to the congestion areas, it may designate National Corridors. Once DOE designates a National Corridor, the Commission has the authority under FPA section 216(b) to issue permits to construct or modify electric transmission facilities in such a corridor under certain circumstances.

12. The Western Interstate Energy Board and Committee on Regional Electric Power Cooperation (Western Energy Board) and Western Governor's Association (Western Governors) request that the Commission delay issuing the Final Rule until DOE acts on establishing National Corridors. Section 216(c)(2) of the FPA requires that the Commission issue rules specifying the form of the application, the information to be contained in the application, and the manner of service and notice of the permit application on interested persons. While the Commission has no authority to issue a permit unless a facility is in a National Corridor, this does not affect the Commission's ability to put in place the filing requirements that will apply once National Corridors are designated. The Commission, therefore, declines to delay issuance of the Final Rule. The Commission believes that prompt issuance of the Final Rule, coupled with regional conferences to discuss its implementation, is in the public interest and provides timely notice to stakeholders of the procedures that will apply to applications submitted under FPA section 216.

13. American Electric Power Service Corporation (AEP) requests that the Commission define what constitutes a National Corridor and whether the designation is a permanent one. Massachusetts Energy and Facilities Siting Board (Massachusetts Energy Board) requests that the Commission define the ends, geographic dimensions, and specified boundaries for a National Corridor. U.S. Department of the Interior (DOI) also requests clarification on what constitutes a National Corridor. The Commission declines to make such rulings. DOE, not the Commission, is responsible for designating and defining the National Corridors under EPAct 2005. Thus, it would be inappropriate for the Commission to establish an independent definition in the Final Rule or opine on whether a corridor designation is a permanent one.

B. Permit Findings

1. Commission Jurisdiction Under 216(b)(1)

14. Under FPA section 216(b)(1), the Commission has the authority to issue permits to construct or modify electric transmission facilities if: (A) A State in which the transmission facilities are to be constructed or modified does not have the authority to—(i) approve the siting of the facilities; or (ii) consider the interstate benefits expected to be achieved by the proposed construction or modification of transmission facilities in the State; (B) the applicant for a permit is a transmitting utility under this Act but does not qualify to apply for a permit or siting approval for the proposed project in a State because the applicant does not serve end-use customers in the State; or (C) a State commission or other entity that has

authority to approve the siting of the facilities has—(i) withheld approval for more than 1 year after the filing of an application or 1 year after the designation of the relevant national interest electric transmission corridor, whichever is later; or (ii) conditioned its approval in such a manner that the proposed construction or modification will not significantly reduce transmission congestion in interstate commerce or is not economically feasible.

15. Numerous commenters request that the Commission specifically address what it will require of applicants to establish the basis and supporting rationale for the Commission's claiming jurisdiction over proposed electric transmission facilities.

Specifically, they request that the Commission clarify how it intends to determine when the clock starts and stops for the one-year time period for State action on siting requests under FPA section 216(b)(1)(C). They also request that the Commission clarify under what circumstances it will determine that a State has withheld approval and what conditions in a State authorization the Commission will consider sufficient to trigger Commission jurisdiction. The commenters also request that the Commission generally explain how, and when, it will make the determination that it indeed has jurisdiction over a proposed project.

American Public Power Association (APPA), American Transmission Co. (American Transmission), California Resources Agency (CA Resources), Edison Electric Institute (EEI), Kentucky Public Service Commission (Kentucky PSC), New York Department of Public Service (DPS), New York State Senator Wright (Senator Wright), Southern Company Services (Southern Company), Southern California Edison Co. (SoCal Edison), Washington Energy Facility Site Evaluation Council (Washington Council), Western Energy Board, Western Governors, and the Wilderness Society (Wilderness).

a. One Year Clock/Pre-Filing

16. Many commenters request that the Commission specifically address when the one-year period for State processing of an application will commence. They state that the Commission should specify that the one-year clock will not start running until the State determines that the application submitted to it is final and in compliance with the State's filing requirements.

Several commenters contend that the States should have the ability to re-start the one-year review period if the applicant significantly modifies or makes substantive changes to its application.

The Wilderness Society (Wilderness) states that the Commission should require that the applicant prove that it made a good faith effort to comply with State siting and permitting requirements. The Western Energy Board requests that the Commission clarify that an applicant who has not obtained the required Federal permit findings in support of a State application has not filed a complete State application. Iowa Board states that one-year time period should not include periods of appellate review.

Allegheny Power (Allegheny), California Public Utilities Commission (California PUC), Iowa Utilities Board (Iowa Board), Massachusetts Energy Board, National Association of Regulatory Utility Commissioners (NARUC), Pennsylvania Public Utilities Commission (Pennsylvania PUC), Pepco Holdings, Potomac Electric Power Co., Delmarva Power & Light Co., and Atlantic City Electric Co. (PHI Companies), San Diego Gas & Electric (SDG&E), Western Energy Board, Public Service Commission of Wisconsin (Wisconsin PSC), and Washington Council.

Iowa Board, NARUC, and Wisconsin PSC.

17. Several commenters also request that the Commission require an applicant demonstrate how its proposed application has met the statutory requirements for Commission jurisdiction prior to initiating the pre-filing process.

Others request that the Commission begin the pre-filing process while the State process is ongoing.

CA Resources, Communities, Iowa Board, NARUC, New York PSC, Senator Wright, SoCal Edison, Washington Council, and Western Energy Board.

APPA, AEP, Allegheny, Southern Companies, National Grid USA (National Grid), SDG&E, National Rural Electric Cooperative Association (NRECA), and Virginia Electric and Power Co. (Virginia Electric).

18. Communities Against Regional Interconnect (Communities) contend that permitting the pre-filing process to be initiated simultaneous with the ongoing State process represents nothing more than the Commission's desire to “pounce” at the moment its jurisdiction is triggered. Communities, CA Resources, and New York DPS are concerned that simultaneous filings could result in an unwarranted and massive expenditure of time and resources, if it turns out the Commission lacks jurisdiction to consider the application. Iowa Board contends that simultaneous filing deprives States of their authority and conflicts with the purpose of the law. Senator Wright and NARUC note that allowing the pre-filing process to begin at such an early stage prevents the Commission from fully considering the information brought forth during the State siting process.

19. The Commission appreciates the concerns of the States regarding the potential for overlap in State and Commission siting processes. However, the language of FPA section 216 provides for this potential overlap by allowing the Commission to issue a construction permit one year after the State siting process has begun and requiring an expeditious pre-application mechanism for all permit decisions under Federal law. Thus, the Commission pre-filing process can occur at the same time as parallel State proceedings.

To ensure that needed infrastructure is built, Congress therefore adopted a statutory scheme that permits parallel proceedings.

The Commission's pre-filing process is discussed in section II.D. of this Final Rule.

20. While we believe the statute clearly permits parallel Commission-State processes, after taking into account the comments of State agencies and other stakeholders, we do not adopt the approach proposed in the NOPR. Rather, we adopt an approach that is more fully respectful of State jurisdiction.

21. Although some overlap in State and Federal proceedings is inevitable, as was contemplated by FPA section 216, we believe that States which have authority to approve the siting of facilities should have one full year to consider a siting application without there being any overlapping Commission process. Therefore, we find that, in cases where our jurisdiction rests on FPA section 216(b)(1)(C),

the pre-filing process should not commence until one year after the relevant State applications have been filed. This will give the States one full year to process an application without any intervening Federal proceedings, including both the pre-filing and application processes. Once that year is complete, an applicant may seek to commence our pre-filing process. Thereafter, once the pre-filing process is complete, the applicant may submit its application for a construction permit. We believe this approach most adequately addresses State concerns. If we determine in the future, however, that the lack of a Commission pre-filing process prior to the end of the one year is delaying projects or otherwise not in the public interest, we will reconsider this issue.

In all other instances (

i.e.

, where the state does not have jurisdiction to act or otherwise to consider interstate benefits, or the applicant does not qualify to apply for a permit with the State because it does not serve end use customers in the State), the pre-filing process may be commenced at any time.

22. The States also express concern that the one-year time period can be abused. For example, an applicant might not provide complete information to the States in the hopes of frustrating their ability to act within one year and, hence, invoking the Commission's jurisdiction. The Commission believes such instances should be rare. We also

wish to make clear that we will not countenance such behavior. The Commission expects all potential applicants under FPA section 216 to act in good faith as it relates to State jurisdiction. Although the Commission may exercise jurisdiction in all instances where a State has withheld approval for more than one year, the Commission, in determining whether to do so, will weigh heavily clear evidence that an applicant has abused the State process.

23. Under the approach adopted herein, once the one-year time period has elapsed the applicant may commence pre-filing. At the pre-filing consultation required under § 50.5(b) of the Commission's regulations, the applicant will need to tell Commission staff the date that it filed its application and the status of that application. As part of the pre-filing consultation, the Director of the Office of Energy Projects (OEP) will review the applicant's progress at the State proceeding. After the initial consultation process, if the Director of OEP determines that there is sufficient reason to commence pre-filing, a notice will be issued under § 50.5(d) of the regulations. To the extent the State proceeding is still ongoing, the Commission will host a scoping meeting or technical conference to work with the applicant and the State agencies to discuss the need to coordinate, among other things, simultaneous environmental reviews. We believe that such coordination is appropriate because, in some instances, the State may be able to complete its action while our pre-filing process is ongoing, possibly allowing us to terminate any proceedings under FPA section 216.

b. Withholding/Conditioning Approval

24. Numerous commenters request that the Commission define the criteria it would use to determine that a State has withheld approval or conditioned its approval so as to render a project not economically feasible, triggering Commission jurisdiction.

The Western Energy Board and California PUC maintain that a State should not be deemed to have withheld or unreasonably conditioned approval if it fails to act within one year because a project has not received Federal agency approvals or because of delays related to “another provision of Federal law.” California PUC points out that FPA § 216(h)(4)(B) allows the Commission to extend its process beyond a year for those reasons.

Department of Interior, Iowa Utility Board, Massachusetts Energy Board, National Parks, National Regulatory Commissioners, Pennsylvania PUC, PJM, Washington Council, Wisconsin PSC, Western Energy Board.

25. The Iowa Board and Senator Wright state that the Commission should clarify that a State's timely and lawful denial of a transmission project should not give rise to Commission jurisdiction. The Iowa Board also contends that any other conclusion would allow an applicant to sidestep an adverse State ruling by subsequently requesting Federal jurisdiction. The Wisconsin PSC asks that the Commission clarify that State denial for failure to meet proper State requirements does not trigger the withheld approval provision. It claims that this would be a situation where a State agency acted properly and is not guilty of regulatory failure. Communities state that the Commission should not have jurisdiction where the State denies siting approval for valid reasons under State law, such as the protection of environmental resources, the health and safety of its citizens, or if better alternatives are identified through the process.

26. FPA section 216(b)(1)(C) provides jurisdiction to the Commission whenever a State has “withheld approval” for more than one year. The statute does not explicitly define the full range of State actions that are deemed to be withholding approval. Nonetheless, to promote regulatory certainty, we believe it is our responsibility to interpret the statutory language in this proceeding and to give all parties notice of such interpretation. To this end, we believe that a reasonable interpretation of the language in the context of the legislation supports a finding that withholding approval includes denial of an application.

27. Support for this interpretation is found in comparing the language added by EPAct 2005 as new FPA section 216(b)(1)(C)(i) to that of new FPA section 203(a)(5), also added by EPAct 2005. There, in requiring that the Commission grant or deny applications for approval of certain merger transactions within 180 days after the application is filed, the statute specifies the consequences “[i]f the Commission does not act.” The Commission has an obligation to construe a statute in such a manner as to give every word some operative effect.

Interpreting the phrase “withhold approval” to mean “does not act” fails to recognize Congress' use of different words to express its intent.

Cooper Industries, Inc.

Aviall Services, Inc.

, 543 U.S. 157, 167 (2004).

28. Further support for this interpretation can be found in the fact that in addition to giving the Commission jurisdiction to site transmission facilities whenever a State has “withheld approval” for more than a year, FPA section 216(b)(1)(C) also gives the Commission jurisdiction to act in instances where a State has approved construction, but “conditioned its approval” in such a manner that the proposed construction or modification is not economically feasible. Since Congress has provided the Commission with the authority to intervene in circumstances where a State has issued an authorization which will essentially prevent a project from going forward, it would not be reasonable to interpret the statute in such a manner that would leave the Commission without authority to intervene in instances where a State has expressly denied an application.

29. Moreover, legislative history lends support to this interpretation of the statute. Congress devoted substantial time to consideration of energy legislation in the years immediately prior to the enactment of EPAct 2005. It is noteworthy that transmission siting language first appeared in legislation considered in the House of Representatives in 2003. That measure (H.R. 6) allowed the Commission to exercise jurisdiction where a State entity with transmission siting authority “has withheld approval, conditioned its approval in such a manner that the proposed construction or modification will not significantly reduce transmission congestion in interstate commerce and is otherwise not economically feasible, or delayed final approval for more than one year after the filing of an application seeking approval * * *.”

In addition, the report language accompanying the above legislative text states, “The section provides that for such lines, persons may obtain a permit from FERC and exercise eminent domain if, after one year, a State is unable or refuses to site the line.”

The fact that this precursor to the transmission siting provision of EPAct 2005 distinguished “withholding approval” from “delaying final approval for more than one year” and was interpreted to include a State “refusing to site a line” supports the conclusion that “withholding approval” was intended to mean something beyond a failure to act.

H.R. 6, 108th Cong. § 16012 (2003).

H.R. Rep No. 108-65 (April 6, 2003) (emphasis added).

30. Finally, Section 216(b)(1)(C)(i) allows the Commission to exercise jurisdiction where a State entity with siting authority has “withheld approval for more than 1 year after the filing of

an application seeking approval pursuant to applicable law * * *.” If an applicant seeks State siting approval pursuant to applicable law, and the State does not grant the application within one year, the approval is withheld, regardless of whether the State takes a specific action denying it. Indeed, the term “withhold” in this context means to refrain from granting approval, and, conversely, the term “deny” is synonymous with “withhold.” Webster's Third New International dictionary defines “withhold” as “* * * to desist or refrain from granting, giving, or allowing * * *.” The same dictionary defines “deny” as “ * * * to refuse to grant: WITHHOLD” [caps in original]. “Denial,” similarly, is defined as “refusal to grant * * *: rejection of something requested.” Furthermore, Roget's International Thesaurus 4th Ed., Section 776 (“Refusal”) at paragraph 776.4 lists “deny, withhold, hold back * * *” as synonyms. Thus, there is no textual or lexical basis for saying that a formal denial does not entail refraining to grant or allow (

i.e.

to withhold). To say that an official denial does not count as a withholding is to say that “to deny” means something other than “to refrain from granting,” which would not be a reasonable interpretation.

31. Therefore, the Commission finds that when a State fails to act or rejects an application, it has withheld approval and the proposed facility would be subject to the Commission's jurisdiction. However, the fact that we possess jurisdiction does not mean that it will be exercised in all cases. Rather, we retain the discretion, in appropriate circumstances, to allow State processes to be completed beyond the one-year period provided in the statute. Indeed, under the approach described above, the States will, in many cases, have more than

two

years to complete their action, and thereby avoid issuance of a construction permit by this Commission, because our pre-filing and construction permit processes typically take more than one year to complete (which is in addition to the one year provided to State authorities).

32. We also clarify that mere consideration of an application by the Commission does not equate to a jurisdictional determination or Commission approval of the proposed project. Once an application is filed for consideration by the Commission, anyone who questions the Commission's jurisdiction over the proposed project, the timing of the exercise of that jurisdiction, or the merits of the proposal can raise those matters in its intervention or protest. The Commission will make a jurisdictional determination and address comments and protests in a subsequent order issued on the merits of the proposed project.

33. Allegheny requests that the Commission address whether the following would constitute withholding approval: (1) A State cannot make a decision in one year due to State statutes or rules; (2) the State has declined to establish a procedural schedule for reaching a decision within a year; (3) a State commission, after an elapse of one year, has not acted on an application; and (4) approval is conditioned in an unacceptable manner, but does not meet the significantly reduce transmission congestion or not economically feasible test. Wilderness states that the Commission should adopt detailed standards defining what constitutes an economically infeasible project or restrictions that prevent a proposed project from significantly reducing congestion. Communities argue that Commission jurisdiction should not be triggered simply because mitigation measures might increase the costs of the project. DOI also encourages the Commission to look closely at the reason that certain conditions were imposed on a project.

34. The Commission believes that these issues cannot be resolved adequately on a generic basis in this rule. Rather, it is important to consider all relevant factors presented on a case-by-case basis. The Commission will, therefore, not limit its ability to review an application on a case-by-case basis by establishing specific criteria that it will consider in determining if its jurisdiction had properly been invoked under FPA section 216(b)(1).

c. Other Jurisdictional Issues

35. PJM Interconnection (PJM) requests that the Commission address the Commission's jurisdiction over facilities that span multiple States where one State may have approved the facilities and another does not. While the Commission's jurisdiction may, in these circumstances, only attach to the portion of the facility that would qualify under FPA section 216(b)(1), under the National Environmental Policy Act of 1969 (NEPA), the Commission would have to analyze the impact of the entire project. The Commission may, however, adopt State analyses where possible. Additionally, to make its determination under FPA sections 216(b)(2) through (6) the Commission would have to review the operation of the facility as a whole.

36. PHI Companies request that the Commission clarify that where a State does not have the authority to grant eminent domain rights for transmission facilities, that constitutes the State not having authority to approve the siting of facilities, thus giving a project sponsor immediate access to the Commission's jurisdiction. While State law may not authorize the taking of property by eminent domain, if it still has laws that address the siting of electric transmission facilities, it appears that the Commission's jurisdiction will not attach unless the State fails to act or denies an application as required by FPA section 216(b)(1)(C). We will, however, consider such issues if, and when, they arise.

2. Other Findings Under 216(b)(2) Through (6)

37. Under FPA sections 216(b)(2) through (6), the Commission must find that the proposed facility: (1) Will be used for the transmission of electric energy in interstate commerce; (2) is consistent with the public interest; (3) will significantly reduce transmission congestion in interstate commerce and protect or benefit consumers; (4) is consistent with sound national energy policy and will enhance energy independence; and (5) will maximize, to the extent reasonable and economical, the transmission capabilities of existing towers or structures.

38. NARUC asserts that the final rule needs to state more clearly how the Commission will implement all five of the above criteria. Pacific Gas and Electric Company (PG&E) requests that the Commission clarify how it intends to measure and analyze sufficient showings related to consistency with the public interest and national policy. DOI and Laura and John Reinhardt (Reinhardts) request that the Commission define the criteria necessary to establish a basis for the public interest determination. Massachusetts Energy Board states the Commission should define “consistent with the public interest” to include that there is no superior approach to the identified transmission project; there is no superior alternative to the proposed route; and all feasible mitigation of environmental impacts and any adverse reliability impacts will be undertaken.

39. Wisconsin PSC states the Commission should examine a variety of factors, including cost-effectiveness, safety, engineering, project alternatives, individual hardships, reliability, competitive impacts, and environmental impact to judge whether a project is in the public interest. PJM believes the Commission should specifically look at adding a reliability requirement and a market efficiency analysis. NARUC

requests that the Commission consider the impact of the project on host States and any possible mitigation, and also require that harmful financial impacts of the project are mitigated through an applicable cost allocation methodology within the Commission's jurisdiction.

40. PSEG Companies contend that the Commission should define the term public interest to consider the energy and environmental policies of the States where the transmitted energy will provide power. It states that “significant” should be defined as it applies to the reduction of congestion and that “sound national energy policy” should be clarified to consider that national security concerns will be taken into consideration. Finally, PSEG Companies state that the criteria for approval should be on a cost-benefit basis and an applicant should specify whether the project is being built for reliability or for economic reasons because that could lead to a different evaluation. Wilderness asserts that the Commission's public interest determination should consider the benefits of electric transmission, the project's environmental impacts, and alternatives with less environmental impacts. Progress Energy (Progress) cautions the Commission to be mindful that a policy of maximum use of existing towers and structures should be conditioned upon maintaining or improving the reliability of the transmission system.

41. While commenters have raised a number of valid public interest considerations, the Commission cannot adopt an exclusive list of factors or construct a bright-line test to determine whether a project meets all the statutory criteria. It is difficult to construct helpful bright line standards or tests for this area. Bright line tests are unlikely to be flexible enough to resolve specific cases and to allow the Commission to take into account the different interests that must be considered. In reviewing a proposed project, the Commission will consider all relevant factors presented on a case-by-case basis and balance the public benefits against the potential adverse consequences. The Commission will conduct an independent environmental analysis of the project and determine if there is no significant impact as required by NEPA. It will look at alternatives, including, as appropriate, alternatives other than transmission lines, and consider whether the proposed facilities would maximize the use of existing transmission facilities. It will review the alternatives for their respective impacts on the environment and will determine mitigation measures to lessen the adverse impacts. The Commission will review the proposed project and determine if it reduces the transmission congestion identified in DOE's study and if it will protect or benefit consumers. It will investigate and determine the impact the proposed facility will have on the existing transmission grid and the reliability of the system.

42. The Commission will also consider the adverse effects the proposed facilities will have on landowners and local communities. The Commission will evaluate the entire record of the proceeding, and after due consideration of the issues raised, determine if the proposed project is consistent with Congress' goals and objectives in enacting FPA section 216, while avoiding unnecessary disruptions to the environment and the unneeded exercise of eminent domain. The Commission's review of a proposed project will be a flexible balancing process during which it will weigh the factors presented in a particular application. It will impose appropriate conditions necessary to avoid adverse economic, competitive, environmental or other effects on the relevant interests from the construction of a new project, and will approve the project only where the public benefits to be achieved from the project outweigh the adverse effects.

43. PG&E states the Commission should rebuttably presume a need for a project subject to the independent oversight of an approved independent system operator (ISO) or regional transmission organization (RTO) without a direct economic interest in the application process. It contends that this will maximize efficiency as participants must already make showings of local or regional need to gain approval from an ISO or RTO. PSEG Companies encourages the Commission to incorporate the results of the RTO process into its proceeding. APPA asserts that if a project results from an open and collaborative regional planning process designed to meet the transmission needs of load-serving entities (LSE) within the national interest electric transmission corridors, or a consortium with broad LSE ownership/participation then there should be a presumption of public interest. Similarly, NRECA contends that the Commission cannot reasonably make the FPA section 216(b)(2) through (6) findings unless the proposed expansion or modification arose from a truly open and inclusive joint transmission planning process. It requests that the Commission require an applicant to complete a joint planning process before beginning the pre-filing process.

44. The Commission agrees that the determinations of an independent entity, such as an RTO, should be given due weight in our assessment of whether a particular facility is needed to protect or benefit customers. We will, therefore, consider any such independent determinations as a factor, along with all other relevant factors, in determining whether the statutory criteria have been met.

C. Project Participation

45. Section 216(d) of the FPA requires that the Commission afford each State in which the transmission facility covered by the permit application is or will be located, each affected Federal agency and Indian tribe, private property owners, and other interested persons, a reasonable opportunity to present their views and recommendations with respect to the need for and impact of a facility covered by the permit application. Additionally, under FPA section 216(h)(3) and its delegated authority, the Commission needs to coordinate the Federal authorization and review process with any Federal agencies, Indian tribes, multistate entities, and State agencies that are responsible for conducting separate permitting and environmental reviews of the facilities.

46. Under the Commission's review process, any interested entity or individual will have multiple opportunities to participate and express its views on the proposed project.

Under § 50.4 of the Commission's regulations, the applicant is required to develop a Project Participation Plan (Participation Plan) to facilitate participation from all stakeholders during the Commission's proceedings. The Participation Plan will be used to provide accurate and timely information, including the environmental impacts, as well as the national and local benefits, of the proposed project, to all stakeholders. The Commission expects that the applicant will conduct various outreach activities to solicit comments on its proposal before commencing the Commission's review process.

The Commission considers any interested entity or individual to be included in its definition of stakeholder in § 50.1 of the Commission's regulations.

47. In addition to the applicant's outreach activities, Commission staff will conduct its pre-filing process. As part of this process, Commission staff will start its scoping and environmental review of the proposed project as

required by NEPA. As part of this review, it will seek comments and recommendations from interested stakeholders. Commission staff will use those comments during its preliminary review of the proposed project to formulate the issues raised by the project and to assist the applicant in compiling the information necessary for the Commission staff to draft the environmental document and for the Commission to address those issues during the application process.

48. Once the application is filed, it will be noticed and interested stakeholders will be able to file to intervene and/or file protests and/or comments concerning the applicant's proposal. Additionally, during the application proceeding, the Commission will issue a draft environmental document.

The environmental document will also be subject to a comment period where any stakeholder may file comments concerning the findings made in that document. Finally, the Commission will issue a final environmental document and an order addressing the issues raised in the proceeding.

The Commission will issue an environmental assessment under § 380.5 or an environmental impact statement under § 380.6 of the Commission's regulations depending upon the level of NEPA review that will be required for the proposed project.

49. The Commission received numerous comments on its proposal for public participation in its siting process. Many commenters requested clarification on how the Commission envisioned its notification requirements would be implemented, who would be notified about the project, and how an interested stakeholder would be able to access information and participate in the Commission's proceedings. Some commenters were concerned that the Commission's definition of affected landowners was too limited. Others thought it was too broad. Some commenters were afraid that their group may be excluded from the definition of stakeholder. Others thought a stakeholder's right to participate should be restricted.

1. Landowners

50. Under § 50.1, an affected landowner is an owner of property interests, as noted in the most recent tax notice, whose property is: (1) Directly affected, crossed or used, by the proposed project; or (2) abuts either side of an existing right-of-way or proposed facility site or right-of-way, or contains a residence within 50 feet of a proposed construction work area. In addition, § 50.4(c) requires that the applicant notify any landowner with a residence within a quarter mile from the edge of the construction right-of-way.

51. Communities contend that the definition of affected landowner is too limited and must be broadened to provide a fair opportunity for intervention and a comprehensive environmental review. It states that it should include all landowners directly affected by the proposed facility so that all such individuals are allowed to participate fully in the proceeding. DOI requests that the definition of affected landowners include land management agencies. Similarly, National Parks Conservation Association (Parks Association) requests that the definition of affected landowner be reworded so that land managing agencies with fee simple lands and those lands in which agencies own scenic easements, are notified during the appropriate times.

They contend that if the Commission does not include Federal agencies as “affected landowners,” it needs to develop a notification criterion for Federal agencies that manage public lands. DOI also encourages the Commission to add a procedure for notifying stakeholders who would be within the viewshed, but not necessarily abutting, the proposal project to help notify other Federal governments and agencies involved in the project.

Lackawaxen River Conservancy adopts the comment of the Parks Association.

52. Parks Association requests that the reference to “directly affected” landowners in § 50.1(a)(1) needs to be defined since an electricity corridor might not cross or use parklands, but could still “directly” affect the scenic and historic resources of a park. It also states that a specific definition of “used” in § 50.1 should be added and include landowners whose property is exposed to noise and visual impacts. Moreover, Park Associations believes the quarter mile distance requirement is inadequate to address the possible adverse impacts on lands discussed in the land use, recreation, and aesthetics resource report. Massachusetts Energy Board requests that the Commission define affected landowner using a distance greater than 50 feet from overhead transmission lines or use a definition based on a distance from the edge of the cleared or permanent right-of-way.

Additionally, Massachusetts Siting Board also states that the word “and” should be replaced with “or” after the phrase “temporary workspace”. We agree that the word “and” between the two requirements should be replaced with “or” and have changed the regulation accordingly.

53. The definition of affected landowner is meant to encompass owners of property either directly within or adjacent to the proposed right-of-way and construction area. If a land management agency manages land on or adjacent to the proposed right-of-way and construction area, it will be considered an affected landowner. While the definition only encompasses land on or abutting a proposed right-of-way, the applicant must also notify all landowners with a residence within a quarter mile of the edge of the construction right-of-way under the notification requirements of § 50.4(c)(1). The Commission believes that between the definition of affected landowner and the expanded quarter mile notification requirement, a sufficient group of individuals will be notified of the proposed project.

54. Stakeholders do not need to be an affected landowner or live in a residence within a quarter mile of the proposed site to participate in the Commission's proceedings. Under the definition of stakeholder in § 50.1, any interested entity or person may file comments as a stakeholder and participate in the Commission's process. Even if a specific land management agency is not included in the definition of affected landowner, it can still participate as a stakeholder. Resource Report 8, in § 380.16(j), requires that the applicant identify the existing land use in the vicinity of the proposed facility, including areas designated for studies under Federal law under § 380.16(j)(7). If, for some reason, a specific land management agency is not identified in the early planning stages of a project, as discussed below, during the pre-filing process Commission staff will work with the applicant to determine if any potential stakeholder has been missed and if they have, to make sure that they have had notice of the proposed project and an opportunity to participate.

55. Southern states that owners with property interests that abut an existing right-of-way should not be included in the definition of affected landowners unless it becomes necessary to secure easements or other rights from such owners. It argues that the definition should be limited to owners of property interests directly affected by the project and not to property interests that abut existing rights-of-way. Allegheny states that the Commission should only require notification of landowners with residence within 50 feet of a construction work site, as required under the affected landowner definition under the Commission's natural gas pipeline regulations in § 157.6(d)(2)(ii) and not expand the landowner group to residences within a quarter mile of the right-of-way as required under § 50.4(c).

56. While property owners with land that abuts the proposed right-of-way or with a residence within 50 feet of the proposed construction work area may not be required to negotiate easements once the ultimate route is determined, one of the purposes of the pre-filing process is to review the applicant's proposed route and explore route alternatives and variations based on the input the Commission receives from property owners and other interested entities and individuals. It is important that potentially affected property owners are notified early on in this review process to provide the Commission with their views and recommendations as required under FPA section 216(d). Additionally, once construction commences, abutting property owners may be impacted by the construction activities conducted in such close proximity to their property and should be made aware of these activities.

57. The Commission also believes it is appropriate to notify all landowners within a quarter mile of the proposed right-of-way. Unlike gas pipelines which are generally buried underground, electric transmission lines can be seen from greater distances. Therefore, more surrounding landowners should be directly notified by the applicant. The fact that these landowners are not designated as affected landowners does not diminish their right to be notified and participate in the Commission's proceedings. Additionally, the Commission will also notify these individuals of its intent to conduct its environmental review and will seek comments from them during that review.

58. PG&E states that the Commission should defer to States' distance requirements for notification of affected landowners. It requests that where there is no corresponding State requirement, the Commission should designate the appropriate minimum distance between the proposed project and a landowner's property that would trigger the direct notification requirement. National Grid recommends that the Commission only require notification within 300 feet of the construction right-of-way.

59. The Commission does not believe it is appropriate to defer to States' distance requirements for notification of affected landowners or that notification within 300 feet is sufficient to reach the broad group of participants that the Commission seeks to include in these proceedings. Moreover, having different requirements in different States may result in inconsistent requirements along the route of a multistate project.

2. Stakeholders and Notification

60. Section § 50.1 defines a stakeholder as a Federal, State, or multistate, Tribal or local agency, any affected non-governmental organization, or other interested person. In other words, a stakeholder includes agencies and individuals contemplated under FPA section 216(d) and the permitting agencies contemplated under FPA section 216(h)(3).

Under § 50.4(c) the applicant is required to notify all known stakeholders, including affected landowners, of the proposed new facilities or modification of existing facilities within 14 days after the Director of OEP or his designee notifies the applicant of the commencement of the pre-filing process. Additionally, under proposed § 50.4(c)(1)(ii), the applicant must publish the notice of the pre-filing request and application filing twice in a daily or weekly newspaper of general circulation in each county in which the facilities will be located.

Section § 50.1 defines a permitting entity as any entity, including Federal, State, Tribal, or multistate, or local agency that is responsible for conducting reviews for any Federal authorization that will be required to construct an electric transmission facility in a national interest electric transmission corridor.

61. Communities states that while counties are technically included in the definition of a person under § 385.102(d) of the Commission's regulations they should, nevertheless, be prominently listed as stakeholders for the purposes of these regulations. Imperial states that as a political subdivision, it should be accorded stakeholder status. The Commission considers any interested entity or individual to be included in its definition of stakeholder in § 50.1 of the regulations. Thus, if a particular entity, such as a non-public utility or a county, is not specifically listed in the definition of stakeholder, it still may comment and participate in the Commission's proceedings.

62. SoCal Edison, PG&E, and NRECA request that the applicant provide electric utilities and affected transmission owners and operators with notice and opportunities to participate in the process if they would be connected to an applicant's proposed transmission facility, provide service in the service area, or would be impacted, either by environmental, reliability or structural impact, as a result of the project. Western Energy Board requests that the applicant should also notify individuals who have expressed an interest in the State proceeding. It also requests that the Commission include a requirement for the applicant to periodically update the notification list as properties change hands.

63. The Commission agrees that electric utilities and transmission owners and operators that are connected to the applicant's proposed transmission facilities should be notified of the proposed project. We also believe it is appropriate for the applicant to notify individuals that have expressed an interest in the State proceeding, if a list of those individuals is available to the applicant. Accordingly, we will expand the notification requirement in § 50.4(c)(1) to include electric utilities and transmission owners and operators that are or may be connected to the applicant's proposed transmission facilities and any known individuals that have expressed an interest in the State proceeding.

64. Section 50.4(c)(3) requires that the applicant supply a stakeholder notice of the proposed project if a stakeholder is identified subsequent to the initial notice of the project. If a property changes hands during the pre-filing and application proceeding, the applicant is required to notify the new owners once they are identified. We will not, however, require that the applicant actively monitor land sales along the project route to determine if a piece of property happens to be sold during the Commission's proceedings.

65. White Mountain Apache Tribe (White Mountain) recommends that the Commission require applicants to publish the notice of a pre-filing request in tribal newspapers when any part of the project will affect tribal lands. We agree and will add tribal newspapers to the notification requirement of § 50.4(c)(1)(ii).

66. DOI recommends that the notices published in the newspapers include a map of sufficient detail to allow the reader an immediate understanding of the general location or the proposed construction right-of-way. Section 50.4(c)(2)(i)(C) requires the filing of a general location map. The notice also provides information concerning how an individual can seek additional information if the information in the newspaper is not sufficient.

67. Affiliated Tribes of Northwest Indians (Affiliated) and White Mountain state that the Commission should assure that all Tribal entities whose traditional lands or cultural places are crossed by a potential project should be notified. National Grid states that the Commission should clarify what Tribal governments involved in the project means so the proper ones can be notified. Section 50.4(c)(1) requires that the applicant notify tribal governments. We believe this is sufficient to address

Affiliated's and White Mountain's concerns. We also do not believe any clarification of Tribal government is necessary. That information is readily available from the Bureau of Indian Affairs or the State or Tribal Historic Preservation Office. Moreover, as discussed below, part of the pre-filing process is for the Commission staff to work with the applicant to determine if any potential stakeholder has been missed and if they have, to make sure that they have had notice of the proposed project and an opportunity to participate.

68. EEI requests that the Commission limit the term stakeholder to an affected agency or person.

It contends that interested person could include a broad range of parties that are not impacted by the proposed project. Southern states that interested person should be reasonably and precisely drawn to clearly specify the scope of their participation, including actions these participants may take with respect to any project or application. National Grid states that the Commission should require stakeholders to provide notice to Commission staff and the applicant of the stakeholder's interest and intended involvement in the pre-filing process.

PHI Companies supports EEI's comments.

69. The Commission intends to seek comments from a broad group of participants during the pre-filing process. Once the application is filed the Commission will still entertain comments from interested entities and individuals. If anyone wishes to intervene in the application proceeding and become a party, however, they will need to file a motion to intervene in accordance with § 385.214 of the Commission's regulations. Under § 385.214(b)(2) the motion to intervene must show that the movant has an interest that is directly affected by the outcome of the proceeding.

70. Old Dominion Electric Cooperative (Old Dominion) is concerned that stakeholders will not receive sufficient notice of the commencement of the pre-filing proceeding because the Director of OEP will only notify the applicant under § 50.5(d). Old Dominion suggests, among other things, that the Director's notice be published in the

Federal Register

and be made available on the Commission's website. As discussed above, the Commission has modified the group of stakeholders listed in § 50.5(e)(3) that are required to receive notification of the Director of OEP's notice commencing the pre-application process from the applicant. Additionally, the notice will be available on the Commission's Web site. We find that is sufficient notification of the commencement of the pre-filing process.

71. Reinhardts request that the Commission require that the applicant file a formal affidavit with: A copy of the notice sent to landowners; a copy of the newspaper notices and list of publications where they appeared; and the names and addresses of all notified entities so that third parties are able to verify that the applicant has complied with the notice requirements. Western Energy Board states that the applicant should be held to a higher standard than “good faith effort” for the notification of property owners. Affiliated contends that the notice requirements are insufficient because there are no penalties to assure that all stakeholders are identified at the beginning of the project. American Transmission asserts that the notification should be made on a good faith effort basis and stakeholders will have a reasonable opportunity to receive notice. NRECA states that the notification requirement should be deemed deficient if the applicant learns of additional stakeholders after the 14-day period.

72. Pre-filing is an information-gathering process. During this process, Commission staff will work with the applicant to make sure that all interested stakeholders have been made aware of the proposed project and have had an opportunity for their views and recommendations to be considered. Thus, part of the pre-filing process is for the Commission staff to review who the applicant has notified and to work with the applicant to determine if a potential stakeholder has been missed and if they have, to make sure that they received notice of the proposed project and an opportunity to participate. The Commission has successfully relied on this process in its review of hydroelectric and natural gas projects.

3. Document Availability

73. Under § 50.4(b), an applicant is required to make copies of all of its filings readily available for all stakeholders to review at accessible central locations, either in paper or electronic format, and on the applicant's project Web site. Allegheny requests that the Commission add a provision comparable to those in the natural gas pipeline certificate regulations that reduce the applicant's service requirements if its materials include voluminous or difficult to reproduce material. The Commission agrees that if these materials are readily available at central locations and on the applicant's project Web site, it should not be required to serve these materials on all parties as required under § 385.2010 of the Commission's regulations. Thus, we will add § 50.4(b)(3) to the regulations to state:

An applicant is not required to serve voluminous or difficult to reproduce material, such as copies of certain environmental information, to all parties, as long as such material is publicly available in an accessible central location in each county throughout the project area and on the applicant's project Web site.

4. Participation Process

74. As stated, under the Commission's review process all interested stakeholders will have numerous opportunities to present their views and recommendations with respect to the need for and impact of a proposed facility. Those opportunities include participating during the applicant's outreach activities, during the Commission's NEPA process during both the pre-filing and application processes, and through the Commission's intervention and protest procedures during the application process. Numerous commenters raise concerns about their ability to participate in the pre-filing and application processes.

75. Reinhardts state that the Participation Plan should include information of how interested persons may be notified of dates and times for public meetings or hearings on the proposed project. Star Group (Star) states that the Participation Plan should identify the means by which stakeholders will be given the opportunity to meet with the applicant to attempt to understand and resolve key issues. American Transmission believes the Commission should give more guidance concerning what constitutes a complete Participation Plan. Old Dominion requests that the Commission require the applicants provide a summary of stakeholder participation to date in the Participation Plan, including concerns expressed by stakeholders, and efforts by the applicant to address those concerns.

76. The Commission expects that the applicant will have conducted outreach activities at the planning and/or State level prior to commencing the Commission's pre-filing process. The Participation Plan must detail all of the outreach activities the applicant has done to date and summarize the input it received during that outreach. It also must include a list and schedule of all pre-filing and application activities the applicant is planning, including, among other things, consultations, information gathering, and proposed location(s) and

date(s) for the meetings. The applicant must also describe how it intends to keep the stakeholders apprised of any updates to its Participation Plan, including, but not limited to, postings to its project Web site and how the stakeholder can reach the company's contact to seek additional information.

77. Parks Association and DOI request that the Commission require applicants to release a pre-route proposal before the pre-filing process begins for a permit. One of the purposes of the pre-filing process is for Commission staff to work with the applicant and interested stakeholders to determine the ultimate route of the proposed project. Moreover, for siting proceedings that are initiated in a State proceeding, stakeholders will already have some idea of the approximate route from that proceeding. The Commission does not believe it is necessary to add yet another level of notification to an already potentially lengthy process.

78. PSE&G and Allegheny request that the Commission establish a docketed, publicly-noticed proceeding for pre-filing or use a technical conference to assure that stakeholders will be afforded a formal opportunity to present their views. New Jersey Board of Public Utilities (New Jersey BPU) requests that the Commission provide for videoconferencing of the meetings. Old Dominion states that the Commission should not only fix the time by which interventions are due, but also provide a fixed time for interested parties to file comments or protests to applications. Communities, Old Dominion, and Star are concerned that the pre-filing process does not provide an opportunity to give any meaningful input to the Commission. Communities argue that without notice and comment during the pre-filing process or transparency in the Commission's decision-making process, intervenors and the public will be significantly handicapped in their efforts to meaningfully participate once the formal application process begins. They are also concerned that interested parties and the public will not have any intervention rights or any comment rights during the pre-filing process.

79. The Commission's pre-filing procedures offer numerous occasions for stakeholders to express their interests and make meaningful contributions. Once the Commission commences the pre-filing proceeding, it will assign a docket number to the project. All the applicant's pre-filing materials will be posted under that docket number in the Commission's eLibrary and will be available through the Commission's Web site. All subsequent filings made in that docket by the applicant, any comments filed by stakeholders in that docket, and any issuances made by the Commission in that docket, including notices and requests for additional information will be posted on eLibrary under that docket number.

Information concerning how to use the Commission's services can be found on the Commission's Web site at

http://www.ferc.gov

and will also be included in the notices the Commission issues concerning the proposed project.

80. Once the Commission staff establishes that the applicant has filed sufficient preliminary information to proceed with pre-filing, the Commission will issue a notice of intent (NOI) to prepare an environmental document. The NOI will describe the project, list potential issues identified by the Commission staff,

and explain the Commission's scoping and environmental review process. It will explain how to participate in the Commission's process by submitting written comments. The notice will set a date by which time the comments will be due. It will also list the scoping meetings the Commission staff will hold at various locations throughout the proposed project route to access the maximum amount of participation possible. The Commission will have a transcriber at its scoping meeting to create a record of the comments received at that meeting.

The list of issues may be modified during the environmental review process based on the comments received during the Commission staff's analysis.

81. Depending on the issues that arise during the course of pre-filing, Commission staff may determine that it is necessary to hold various technical conferences or other meetings to acquire additional input and information concerning the proposed project. The Commission will issue notices of these meetings in the docket number assigned to the project. Additionally, the applicant will need to update its Participation Plan to reflect any additional outreach that may be conducted as part of the Commission's review process. If the Commission determines it is appropriate, it could arrange to provide for videoconferencing of certain meetings. However, because the Commission conducts various meetings along the route of the proposed project, videoconferencing should not be necessary. Additionally, transcripts of the meeting will be available under the assigned docket in eLibrary and the Commission's Web site.

82. AEP is concerned that there is no limit on stakeholder input in the pre-filing process. It states that stakeholders can push for revisions and continue to ask questions, which continue to postpone a project. AEP recommends that the process should be modeled more like a rulemaking with time-limited input. EEI asserts that the applicant should not necessarily be obligated to communicate with parties that have not demonstrated that they will be impacted by the proposed project. Southern states that the obligation to entertain requests for information should be limited in scope and in terms of the participants that may request additional information or else it would lead to significant delays.

83. During pre-filing, the Commission will solicit comments from stakeholders. Any notice issued by the Commission soliciting comments will include a deadline date for those comments. The Commission expects that the applicant will address stakeholder concerns in various ways. Under § 50.4(a)(1), the applicant is required to have a point of contact within the company to answer general inquiries that may arise. The applicant can also establish a link on the project Web site that addresses frequently asked questions and refer the inquiry to that link or other areas on the Web site to address inquiries, as appropriate.

84. Based on the comments received in response to the NOI and information gathered on visits to the site of the proposed project, Commission staff will work with the applicant to compile the information and conduct the studies necessary for the Commission staff to prepare a draft environmental document. Once the Director of OEP has determined that sufficient information has been gathered for the Commission to proceed with the final review of the applicant's proposed project, pre-filing will end and the applicant will file an application.

85. Once the application is filed, it will be noticed and interested entities and individuals will be able to file to intervene and become a party to the proceeding under Subpart B of Part 385 of the Commission's regulations. Instructions on how to do this will be explained in the notice of the application and are available on the Commission's Web site.

86. American Transmission requests that the Commission allow State, local, and regional planning and siting entities to participate in the proceeding as a matter of right. Communities state that local counties that will be impacted by the proposed facilities should have automatic rights to intervene and receive notices and information. NRECA contends that the Commission should coordinate closely with the Rural Utilities Service to avoid duplication

and the imposition of additional burdens on applicants.

The Rural Utilities Service provides capital to upgrade, expand, maintain, and replace America's vast rural electric infrastructure. NRECA states that financing obtained through the Rural Utilities Service is subject to rigorous long-term planning obligations that are substantially more demanding than the resource adequacy requirements that apply to other LSEs.

87. Under § 385.214 of the Commission's regulations, any State commission, Advisory Council on Historical Preservation, the U.S. Departments of Agriculture, Commerce, and the Interior, any State fish and wildlife, water quality certification, or water rights agency, or Indian tribe with authorization to issue a water quality certification is a party to any proceeding upon filing a notice of intervention in that proceeding. The Commission sees no reason to expand this regulation. All other interested persons may seek intervention by filing a motion to intervene.

88. DOI raises several issues pertaining to the timing of the draft environmental document under the NEPA. Specifically, it is concerned as to when other Federal agencies will get an opportunity to review the draft document. It encourages the Commission to include a timeframe for public review of the NEPA document along with clarification as to when the Commission will issue the NEPA document. After the application is filed, the Commission will issue a draft environmental document, on which interested stakeholders will be able to comment. All comments received will be addressed in the final environmental document which will be completed before the Commission issues an order on the merits of the application.

89. When the Commission completes its review of the application, it will issue an order addressing the issues raised in the proceeding and issuing, or denying, a permit to construct the proposed facilities. Under FPA section 313(a) and § 385.713 of the Commission's regulations, any party may file a request for rehearing. Requests for rehearing must include the information required under § 385.719(c) of the Commission's regulations. The Commission will issue an order addressing the issues raised in the rehearing requests. If the Commission denies the rehearing requests, any party who intervened in the proceeding and is aggrieved by the Commission's order may file, under FPA section 313(b), an appeal in the United States Court of Appeals.

D. Pre-Filing

90. The purpose of the pre-filing process is to facilitate maximum participation from all stakeholders to provide them with an opportunity to present their views and recommendations with respect to the need for and impact of the facilities early on in the planning stages of the proposed facilities as required under FPA section 216(d). In addition to gathering stakeholder input, during this time Commission staff will work with the applicant to compile the information required for a complete application under §§ 50.6 and 50.7.

91. The filing requirements in §§ 50.6 and 50.7 set forth the basic information that the Commission will need for a generic project. However, each project will have its own unique issues that will need to be considered on a case-by-case basis. For example, an electric transmission facility constructed through farmland will have a different impact than one that will go through a heavily populated area. During the pre-filing process, Commission staff will initiate its independent environmental analysis of the project as required by NEPA. It will conduct scoping meetings and site visits. Staff will use the information gathered through this process and from information acquired from stakeholder input to define the issues particular to a specific project. Based on these activities, Commission staff assists the applicant in compiling the information necessary for the Commission to address the specific concerns raised by the proposed project during the application process.

1. Initial Consultation Issues

92. Section 50.5(b) requires that an applicant meet with the Director of OEP before filing its pre-filing materials. During the consultation process, Commission staff will review the applicant's proposed project description, including the status of the applicant's progress towards collecting the data needed to commence the pre-filing process, and any preliminary contacts the applicant has had with stakeholders, including its progress in DOE's pre-application process and in the State proceeding, if applicable.

93. Commission staff will review the applicant's eligibility for Commission jurisdiction for a permit for the proposed facility, outline the pre-filing process, and provide guidance as to what further work is necessary to prepare the pre-filing request. Commission staff will also review the proposed project to determine if the applicant will be required to hire a third-party contractor to assist in preparing a NEPA document under the direction of the Commission staff.

94. Virginia Electric requests that the Commission explain what will be reviewed by staff in the initial consultation and when such reviews will take place. American Transmission requests that the Commission define what constitutes a complete set of pre-filing information to assist in expediting the process.

95. While any applicant may seek guidance on a potential project from Commission staff at any time, the Commission expects that the applicant will commence the initial consultation process for pre-filing when it believes that there is sufficient evidence that a proposed project will be subject to the Commission's jurisdiction and it has prepared the required pre-filing information. At the pre-filing consultation, Commission staff will review the applicant's specific project and the information the applicant has compiled to date and discuss how that information complies with the initial pre-filing filing requirements in § 50.5(e) and the application filing requirements in §§ 50.6 and 50.7. Commission staff will also review what work the applicant has done at the State level, the amount of community outreach the applicant has conducted, and the results of that outreach.

96. While the potential differences between projects make it difficult for the Commission to specifically define what would constitute complete pre-filing information, § 50.5(e) lists the minimum filing requirements that are needed for an applicant to commence the pre-filing process. If the Commission staff find that the applicant has sufficient information to comply with the pre-filing filing requirements in § 50.5(e), the applicant will be allowed to commence pre-filing. If the applicant does not have sufficient information to meet the pre-filing filing requirements, Commission staff will work with the applicant to determine what additional information will be needed to proceed. If the applicant does not have the necessary information, it may take more than one pre-filing consultation before the applicant is prepared to commence pre-filing.

97. EEI argues that rather than requiring applicants to develop and implement an extensive new pre-filing public Participation Plan, the Commission should simply require the applicant to provide appropriate notification to stakeholders that the venue for the siting approval process has moved from the State to the Federal level along with an explanation of how

they can become involved in the Commission's process as an intervenor or under NEPA. SDG&E recommends that an applicant should be able to bypass the pre-filing stage, if at the initial consultation with the Director of OEP it is determined that it has submitted sufficient information with OEP to support beginning to process the application, has submitted a Participation Plan, and has complied with the pre-filing requirements of § 50.5(e). PHI Companies similarly suggest the pre-filing process should be optional.

98. Because pre-filing is a fact-finding process used by the Commission staff to commence and initiate its independent environmental analysis and to define specific issues raised by specific projects, it is not possible for an applicant to by-pass the process. However, the time it takes for an applicant to complete the pre-filing process could be significantly reduced depending on the amount of work the applicant had completed in compiling the necessary information prior to the pre-filing process.

99. PJM requests that the Commission staff commence its system analysis review of the proposed facilities during the pre-filing process. Commission staff primarily focuses on compiling the information for the subsequent environmental review during pre-filing. In cases where a project would be located in the geographic area covered by an RTO, we expect much of the information for the system analysis to be developed in consultation with the RTO during the pre-filing phase. If necessary, however, Commission staff will work with the applicant during pre-filing to identify specific information that will be required for the Commission to conduct a system analysis during the application process.

2. Third-Party Contractors

100. Under § 50.5(c)(6) the applicant is required to propose at least three third-party NEPA contractors for the Commission to consider for the proposed project. Under § 50.5(d)(1), the Director of OEP's pre-filing notice will designate the chosen third-party contractor at the beginning of the pre-filing process.

101. Southern states that the applicant should be entitled to select any third-party NEPA contractor to use in its pre-filing and application process, insofar as the Director of OEP determines that a third-party contractor will be necessary. Similarly, National Grid states that an applicant should be permitted to express a preference for a particular contractor and the Commission's staff should generally defer to the applicant's choice because the applicant is financially responsible for the contractor's work. Los Angeles DWP is concerned that the requirement to finalize the contract with the third-party contractor may take 90 days or longer unless one of the four NEPA contractors selected who is currently under contract with the Los Angeles DWP. American Transmission requests that the Commission clarify why it requires that third party contracts be finalized in two weeks in all cases; instead it recommends that it should be 45 days. DOI requests clarification or a reference to the criteria that the Commission will use to determine if a third-party contractor must be hired.

102. The Commission is required under NEPA to do an independent analysis of the environmental impacts of a proposed project. Depending on the amount of work involved, it often requires that the applicant hire a third-party contractor to assist the Commission in analyzing the proposed project. The third-party contractor, while paid for by the applicant, reports directly to Commission staff. Thus, the Director of OEP will designate the appropriate third-party contractor.

While § 50.5(e)(2) requires that the applicant finalize the contract with the selected third-party contractor within 14 days the Commission may waive that requirement rule for good cause. If the applicant cannot finalize the contract with the third-party contractor within two weeks, it can request a waiver of the requirement of § 50.5(e)(2). We note, however, that preparation of an environmental document is a time and labor intensive process. The Commission has implemented the 14-day requirement as a way to expedite the process.

See 40 CFR 1506.5(c), requiring that a contractor used to prepare an environmental impact statement is to be chosen solely by the lead agency (or where appropriate, by a cooperating agency).

3. Subsequent Filing Requirements

103. Section 50.5(e) lists the initial filing requirements and filing deadlines that are required for the Commission staff to commence the pre-filing process. Parks Associations is concerned that this language does not impose strict deadlines to protect the public interest. On the other hand, National Grid requests that the Commission permit reasonable extensions of time beyond the 60-day timeframe for submitting resource reports.

104. The deadline requirements in the regulations are intended by the Commission to expedite the pre-filing process. Since part of the pre-filing process is to assist the applicant in compiling the information needed to file a complete application, the Commission does not expect that the preliminary resource reports filed at the beginning of the pre-filing process will contain every detail required for the ultimate report that will need to be filed with the application. The resource reports required in § 50.5(e)(7) should be preliminary reports that contain sufficient information for Commission staff to commence the pre-filing process and specifically the NEPA process. Commission staff will work with the applicant throughout the pre-filing process to develop all the necessary information for each resource report. It should be noted, however, that delays in filing these materials may delay the decision to allow an application to be filed.

4. Lead Agency Issues/Coordinating Federal Permits

105. Effective May 16, 2006, DOE delegated paragraphs (2), (3), (4)(A)-(B), and (5) of FPA section 216(h) to the Commission as they apply to proposed facilities in designated national interest electric transmission corridors.

Specifically, it delegated lead agency responsibilities for the purpose of coordinating all applicable Federal authorizations and related environmental review and preparing a single environmental review document for facilities in a National Corridor.

Supra note 5.

106. PJM states that the Final Rule should promote coordination among Federal agencies and the resolution of disputes among Federal agencies. AEP states that while the Commission developed well-defined procedures for interacting with State agencies, it should also coordinate siting for the various Federal agencies. DOI requests clarification on whether there are two separate pre-filing processes (one led by DOE and one led by the Commission). Western Energy Board raises similar concerns regarding the duplication of the two processes.

107. As stated, several Federal agencies including DOE and the Commission entered into a MOU to establish a framework for early cooperation and participation that will enhance coordination of all applicable land use authorizations, related environmental, cultural, and historic preservation reviews, and any other approvals that may be required under Federal law in order to site electric transmission facilities. The MOU requires participating agencies, to the

extent practicable, to commit to early involvement and cooperation to ensure that timely decisions are made and that the responsibilities of each agency are met. The Commission intends to work with DOE and the participating agencies to ensure that all Federal permit decisions are rendered in a timely manner.

108. National Grid states that the Commission should request that DOE delegate lead agency status to the Commission at the time the Commission's pre-filing process begins rather than at the filing of an application. Virginia Electric states that the Commission should try to amend its delegated authority to transfer DOE's pre-application coordination to the Commission or coordinate and use DOE's pre-application process to the maximum extent practicable as its own pre-filing process. It contends that anything else may require the applicant to duplicate its agency review activities with the Commission and DOE. EEI requests that the Commission explain the timing and coordination of its lead agency authority with DOE and clarify that filing requirements from permitting agencies be relevant, and preferably significant.

109. We anticipate working closely with DOE and other Federal agencies under the terms of the DOE MOU to coordinate all Federal actions and to ensure that DOE's and Commission's processes interact seamlessly and with as little duplication of effort as possible. We expect that we will coordinate with DOE on an ongoing basis on general issues regarding these matters, as well as on specific cases. In light of this, we see no need to seek amendment of DOE's delegation order.

110. Progress contends that the Commission should exercise lead agency authority in circumstances where Federal agencies are impeding the construction of new transmission facilities regardless of whether the State still has jurisdiction or if it is outside a National Corridor. California PUC similarly urges the Commission to use its lead agency authority to get Federal agencies to expeditiously review applications during the time an application is filed at the State level. PSE&G encourages the Commission not to overstep its statutory authority in this regard.

111. Under DOE's May 17, 2006 delegation order, the Commission is responsible for acting as lead agency when an applicant has submitted an application to the Commission to construct or modify electric transmission facilities. Thus, the Commission's lead agency delegated authority only pertains to facilities subject to the Commission's jurisdiction in National Corridors. DOE retains lead agency authority for coordinating Federal action on facilities not subject to the Commission's delegated authority.

5. Timeframe for Pre-Filing

112. Because of the potential for differences between projects, the Commission does not propose to set exact timeframes for the pre-filing process. The timeframe will depend upon, among other things, the size of the project, stakeholder participation, the applicant's preparedness, and the applicant's progress at the State level. The Commission expects that the pre-filing process for large, multistate “greenfield” projects, will take longer than the pre-filing process for minor modifications to existing facilities.

The Commission anticipates that the pre-filing process for extensive projects may take a year to complete. Additionally, the environmental resource reports required under § 380.16, discussed below, will require comprehensive field work to compile the information necessary to comply with the Commission's obligations under NEPA.

Greenfield facilities are facilities that primarily will be located in new rights-of-way.

113. Southern states that the Commission should acknowledge that the time required for processing applications will vary and that the Commission may also lack authority to require any deadline is met. American Transmission states that the Commission should create a definitive timeline for the submission of information and for the receipt of responsive action by Commission staff. DOI also urges the Commission to establish a chronological timeline to assist applicants and permitting entities to better understand the timing of steps within the permitting process. EEI opposes a uniform pre-filing process schedule. Allegheny states that minor modifications should not require a full-blown pre-filing process.

114. Northern Wasco County Peoples Utility District and Seattle City Light state that since major transmission projects entail long lead-times for land acquisition, procurement, design/engineering and construction, they are concerned that the rule may unnecessarily prolong the amount of time required to take action on project applications. SDG&E states that the rules should embody the urgency reflected in the statute that energy security may be at stake due to delays in transmission siting. EEI requests that the Commission explain the variables in determining how long the pre-filing and NEPA processes will take. Allegheny states that a two-year process for authorization is too long for extensive, reliability-driven transmission projects.

115. As stated in the NOPR and above, because of the potential differences between projects, the Commission cannot establish or predict timeframes for electric transmission projects proceedings. NEPA requires the Commission to conduct an independent environmental analysis of a proposed project. The Commission's NEPA analysis may require a more stringent review of the environmental impacts than is required at the State level. The pre-filing timeframe is dependent upon how far along the applicant is on compiling the information needed by the Commission, the complexity of the project, and what additional information will be required based on the specific issues raised for the individual project. The Commission agrees that time is of the essence in the siting of these facilities. Thus, it believes that it is incumbent on a project sponsor and States to work together in an attempt to site the facilities at the State level. This would be the most expeditious way to site the facilities.

6. Review of Director's Decisions in Pre-Filing

116. Under § 50.5(f), the Director of OEP will determine when there is sufficient information for the applicant to file its application. Old Dominion requests that the Commission provide an opportunity for stakeholder comment before the OEP Director determines that the pre-filing process is complete. Allegheny states that since the Commission had delegated broad authority to OEP, it should provide potential applicants with an opportunity to seek Commission review of OEP's decisions. Southern states that the Commission should add a review process to allow applicants to review and challenge a determination by the Director of OEP. It claims that an absence of due process could lead to court challenges. DOI requests that Federal agencies be consulted prior to the conclusion of the pre-filing process.

117. Stakeholders have various opportunities to comment during the pre-filing process. Therefore, we do not believe it is necessary to add any additional round of comments. Moreover, once the pre-filing process is complete, the applicant will be filing an application for Commission review of the proposed facility which will be noticed and subject to the Commission's intervention and protest procedures. As

a general matter, the Commission relies on its staff to develop the record necessary for the Commission to act on energy project applications, and it does not anticipate entertaining interlocutory appeals regarding the Director of OEP's pre-filing decisions.

E. Application Requirements

118. Pennsylvania PUC states that for a more informed process the Commission should include procedures whereby the application would publicly disclose what information or data the application has omitted. Section 50.2(c) requires that the applicant provide all information required in Part 50 unless it shows that the information is not necessary. We find that this is sufficient to address the concern raised by Pennsylvania PUC.

119. NRECA states that entities seeking permits should be required to show that all requirements are met, including Federal, State, and Tribal permitting requirements which would be consistent with the natural gas regulations. Section 50.2(d) is identical to the requirement in § 157.5(c) and no further modification is necessary.

F. Filing Requirements

120. Section 50.6 lists the general requirements that need to be met when filing an application for a permit. Section 50.6(e) requires that the applicant demonstrate how its proposed project would satisfy the requirements of FPA section 216(b)(2) through (6). The Commission will review this information in addition to the technical information provided in the Exhibits submitted under § 50.7 in making its findings concerning the proposed project. As stated, the filing requirements in §§ 50.6 and 50.7 are the basic information that the Commission will need for a generic project. However, each project will have its own unique issues that will need to be considered on a case-by-case basis. An applicant may request a waiver of a specific requirement if it believes it may not be applicable to its particular project. Similarly, the Commission may request additional information if it deems it is necessary to address issues raised by a proposed project.

121. Various commenters raised issues concerning the Commission's need for specific requirements in each of the exhibits. Some requested that the Commission require additional information. Others question the Commission's need for some of the required information. Several commenters request that the Commission accept the record from the State proceeding to satisfy some of the Commission's filing requirements.

1. State Record

122. The Commission received numerous comments requesting that it maximize the use of information, notices, and materials produced during the State siting process to avoid the costly duplication of materials.

Specifically, Allegheny states that the Commission should not require an applicant to notify stakeholders, conduct public meetings, and submit studies of information that are duplicative of State commission requirements. PHI Companies contend that, at a minimum, the Commission should allow for a waiver of various pre-filing and application steps that the applicant can demonstrate have been satisfied in the State proceeding. Committees request that the Commission require that the record already developed for any State permitting authority be filed and included in the Commission's record.

Communities, American Public Power, EEI, PHI Companies, PSE&G, NARUC, Allegheny, SDG&E, National Grid, American Transmission, SoCal Edison, Pennsylvania PUC, Western Governor's, Virginia Electric, PPL Electric, and California PUC.

123. California PUC states that the Commission should incorporate the findings from the State siting process into its proceeding. SDG&E asserts that the Commission should accept the State's environmental review to the extent it satisfies the requirements of NEPA and to rely on prior NEPA analysis performed as well. Pennsylvania PSC states that the Commission should incorporate the work of already existing planning processes conducted either by regional State organizations or RTOs. SoCal Edison recommends that the Commission adopt generally applicable standards for the submission of previously collected materials to expedite the process. PPL Electric urges the Commission to rely on the aid of State officials to navigate the State siting procedures.

124. It is our expectation that by working with States, applicants, Federal agencies and other stakeholders on an ongoing basis, we will be able to ensure, to the maximum extent possible, that information developed in State proceedings can be used, where appropriate, at the Commission, thereby increasing efficiency and lessening burdens on all parties.

125. While the Commission will accept any pertinent information developed in the State proceeding or elsewhere into its record, the Commission is required under NEPA to do an independent review of environmental impacts. The Commission will take all filed information into consideration as it conducts its review. Similarly, it will consider the State findings while it considers its own findings under FPA section 216(b). Its ultimate determination on whether to issue a permit, however, will be based on the entire record developed in the Commission proceeding after due consideration of all the issues raised.

2. Exhibits

126. Section § 50.7 contains the requirements for the exhibits that must be filed with the application. The exhibits will contain the technical data needed for the Commission's analysis of the application. All the environmental data required under Part 380, specifically the Resource Reports required under § 380.16, will be filed as proposed Exhibit F. Engineering data and system analysis data must be filed in Exhibits G and H.

127. The Massachusetts Energy Board recommends that the Commission add another exhibit that would require that the applicant submit construction information including: construction procedures; construction schedules; plans to coordinate with local authorities; construction noise impacts and noise mitigation; mitigation of wetland impacts of construction; plans for mitigation of the traffic impacts of project construction; and plans to inhibit unauthorized travel on the right-of-way. These are all required to be filed under the environmental requirements in Exhibit F or will be addressed in the Commission environmental analysis. Therefore, additional exhibits are not necessary.

128. Affiliated contends that either § 50.6 or § 50.7 should require an exhibit which describes all tribal interests in the project and outcomes from all Tribal stakeholder participation in the project pre-filing activities and any issues discussed and whether they were either resolved or unresolved and details of the resolution or breakdown in discussions. Tribal governments or agencies are required to be notified at the beginning of the pre-filing process. In addition, information concerning tribal interests are required under § 360.16(f) and § 360.16(j). The Commission believes this is sufficient basic information for the Commission to commence its review of a proposed project. As stated, each project will raise its own unique issues for which the Commission may request additional information if it deems it is necessary to

address particular issues raised by a proposed project. Any information developed during the pre-filing process will be made part of the record and will be considered by the Commission as it conducts its substantive review when an application is subsequently filed.

a. Exhibit E—Maps

129. Section 50.7(e) states that the format for maps will be determined during the initial pre-filing consultation. American Transmission contends that the Commission should use a uniform format that satisfies other government agencies and avoids redundancy. Because technology changes over time, the Commission will not specify a specific format in its regulations. Particular formats will be addressed during the initial pre-filing consultation. Additionally, a potential applicant may contact Commission staff at any time for guidance on the Commission's required formats.

b. Exhibit F—Environmental Requirements

130. The Commission is required to conduct an environmental analysis of a proposed electric transmission project under NEPA. Exhibit F requires that the applicant file the environmental information required under Part 380 of the Commission's regulations. As stated, the filing requirements are the basic information that the Commission will need for a generic project. However, each project will have its own unique issues that will need to be considered on a case-by-case basis. At the pre-filing consultation and throughout the pre-filing process, Commission staff will work with the applicants and stakeholders to determine the issues that arise for each project. Depending on those issues, the Commission staff may require additional information. Conversely, if certain of the filing requirements are not needed for certain projects, Commission staff will consider whether waivers are appropriate for those requirements.

131. Massachusetts Energy Board states that the Commission should include regulatory procedures for evaluating alternatives to a project, minimizing environmental impacts, and denying a permit to construct a project that has significant avoidable adverse impacts. The principal purposes of the Commission's environmental review are to: (1) Identify and assess the potential impact on the natural and human environment that would result from the implementation of a proposed project; (2) identify and recommend reasonable alternatives, including, as appropriate, alternatives other than transmission lines, and specific mitigation measures to avoid or minimize environmental impact; and (3) encourage and facilitate public involvement in the environmental review process. During the application process, the Commission will review the analysis created in the environmental document in concert with the other information analyzed during its review process to determine if it is in the public interest to issue a permit to construct the facilities. If it determines that it is not, it will deny the application.

132. Reinhardts state that the Commission should broaden its rules and its area of inquiry to reasonably justify whether one State or region should suffer the significant environmental and aesthetic burdens associated with large transmission infrastructure to bring economic benefit and pollution reduction to another. The Commission's mandate under the FPA is to determine if the proposed facility is consistent with the public interest on a national level. It may be that a transmission facility will cross several States in order to benefit consumers in other States. The fact that the facility may not benefit the State's crossed by the facility is not determinative on the Commission's decision if the facility benefits a broader region.

133. Communities state that the applicant should be required to demonstrate a good faith attempt to negotiate access, and if access is denied, provide thorough research of all available documentation regarding the property. The Commission expects that the applicant will attempt to negotiate access to as much of the proposed right-of-way as possible for survey purposes. It is in landowners' best interests to allow the applicant access and to get involved in the pre-filing process to have input in the ultimate alignment of the proposed facility. During the pre-filing and application processes, there is more flexibility to achieving shifts in alignment of the proposed facility to accommodate individual landowner needs on their property.

i. Section 380.5—Actions That Require EAs

134. Section 380.5 (b)(14) provides that under certain circumstances the Commission may prepare an environmental assessment (EA) instead of an environmental impact statement (EIS) for a proposed project. American Transmission seeks clarification on whether the Commission will allow applicants the option of preparing a preliminary applicant-prepared environmental assessment. The Commission will decide if an EA or EIS is applicable for a proposed project. If the Commission determines that an EA is appropriate, the Commission will accept an applicant-prepared preliminary draft. After reviewing the draft, the Commission may still require a third-party contractor to assist with finalizing the draft NEPA document.

ii. Section 380.6—Actions That Require EISs

135. Section 380.6 requires that an EIS be prepared for major electric transmission facilities using a right-of-way in which there is no existing facility.

Affiliated proposes that the Commission also add “for which there are likely to be endangered species impacted, substantial issues under the National Preservation Act, or a significant impact to the natural or human environment.” The Commission will require an EIS for these and several other reasons. The decision on what needs to be addressed in the EIS generally is determined on a case-by-case basis based on the information compiled during the pre-filing process. We do not believe it is appropriate to add language that could be interpreted to limit the Commission's discretion to prepare an EIS.

Section 380.6 also lists when EISs are required for natural gas pipelines and hydroelectric projects. AEP requests that the Commission eliminate the references to pipeline projects. Those sections were added to assure the proper placement of the semicolons and the word “and”. They have no other purpose relative to electric transmission siting.

136. Virginia Electric contends that the Commission should delete the “major” before “transmission facilities” in § 380.6 because FPA section 216 confers jurisdiction to the Commission over all electric transmission facilities. The word major in § 380.6 denotes when the Commission will prepare an EIS under § 380.6 as opposed to an EA under § 380.5. The Commission will still review all proposals for electric transmission facilities under its FPA jurisdiction.

iii. Section 380.10—Participation in Commission Proceeding

137. In § 380.10(a)(2)(iii), the Commission clarified that interventions should not be filed in natural gas pre-filing proceedings and in the proposed electric transmission pre-filing proceedings. Old Dominion points out that while interested parties cannot intervene in the pre-filing phase, they can submit comments. New Jersey BPU states that this section should reference the stakeholder participation provided in §§ 50.4 and 50.5 to clarify that

stakeholders have the right to be involved in the process.

Section 380.10(a)(2)(iii) already refers back to the pre-filing activities under § 50.5. We do not believe any further reference to that section is necessary.

iv. Resource Report 1—General Requirements

138. Resource Report 1 requires that the applicant describe, among other things, the facilities associated with the project, special construction and operation procedures, and construction timetables. National Grid contends that whether a project is going to be built in an existing right-of-way should dictate the amount and type of data needed on construction methods, workspace, and related matters. As stated, specific projects will be considered on a case-by-case basis. Projects constructed in an existing right-of-way will raise different issues than a greenfield facility.

139. Section 380.16(c)(2)(i), requires maps and photos covering at least a one-half mile wide corridor centered on the electric transmission facility centerline. Communities contend that a fair definition of the area of impact should begin with a minimum of one-half mile and require an evaluation of the extent beyond that point for each type of impact. National Grid states that the map and photos should be consistent with the State's corridor requirements. The Commission uses the one-half mile distance as a generally acceptable distance for its map requirements. On a case-by-case basis, it will determine the extent of the area of impact based on the specific information gathered during the review process.

140. Section 380.16(c)(2)(i) requires United States Geological Survey (USGS) 7.5-minutes series topographic maps or maps of equivalent detail. The Massachusetts Energy Board contends that these maps are not adequate for a detailed evaluation of impacts in densely populated areas and requests a better resolution of detail than USGS-based maps. We agree that the impact of a proposed facility in a densely populated area will raise different issues than a facility located in a rural area. The Commission will address the issues, as necessary, in each individual proceeding before the Commission.

141. The Center for Biological Diversity requests that the general content requirement include a full lifecycle assessment and air quality and greenhouse gas emissions. It contends that the Commission's NEPA analyses must address the full lifecycle of electric generation and include analysis, mitigation measures, and alternatives that address air quality impacts, energy losses, criteria pollutants, and greenhouse gas emissions. The Commission will review these impacts of the proposed facilities, as required by NEPA and all other relevant environmental laws.

v. Resource Report 2—Water Use and Quality

142. Section 380.16(d) requires that the applicant describe water quality and provide data sufficient to determine the expected impact of the project and effectiveness of mitigation, enhancement, or protective measures. DOI urges the Commission to review the regional impact from local water use. EEI states that the requirement that the applicant identify known public and private groundwater supply wells or springs is inappropriate for above-ground facilities. AEP contends that the Commission should eliminate this requirement because it only pertains to pipeline projects. National Grid states that the Commission should grant requests for waiver for this report for overhead electric transmission projects where no water use or quality effects would occur.

143. The construction of electric transmission facilities will create ground disturbance that may disrupt groundwater in the area of the construction. Thus, the Commission will require that the applicant comply with the requirements of this section.

vi. Resource Report 3—Fish, Wildlife, and Vegetation

144. Section 360.16(e) requires that the applicant file information describing aquatic life, wildlife, and vegetation in the vicinity of the proposed project. Massachusetts Energy Board requests that the Commission require applicants to provide habitat information obtained from State natural heritage officials. Section 360.16 (e)(8) requires that applicants include correspondence from, among others, State fish and wildlife agencies. We believe this is sufficient to address Massachusetts Energy Board's concern.

145. DOI requests that the applicant identify Federal- and State-listed threatened or endangered species in the project area and the impacts to such species in this report. It also requests the section be expanded to require mitigation for invasive species. Sections 360.16(e)(4) and (5) require that the applicant address specific areas of significant habitats or communities of species of special concern to the Federal- and State-listed or proposed threatened or endangered species or critical habitat, respectively.

vii. Resource Report 4—Cultural Resources

146. Section 360.16(f) requires that the applicant file the information needed for the Commission to determine that it has complied with the requirements of the National Historic Preservation Act (NHPA). Wilderness states that Resource Report 4 should explicitly state that the project must comply with section 106 of the NHPA. DOI requests that the report should be expanded to cover nationally and regionally significant historical and cultural resources. It also believes the report should cover the potential construction impacts on archeological sites which may be present in the identified project site.

147. Resource Report 4 is specifically designed to gather all the information necessary for the Commission to comply with NHPA section 106. We do not believe it is necessary to specifically state this in the list of information that the Commission requires the applicant to file. Resource Report 4 requires that the applicant provide the information requested by DOI. Moreover, the Commission's environmental review document will cover the potential impacts on the identified sites.

148. Communities state that there is no valid reason for allowing the delay in the filing of certain reports until immediately before the permit is issued. They contend that all such reports should be filed with the application or the application may be deemed incomplete until such filings are made. The Commission does not believe it is necessary that the applicant have all the cultural resources reports and plans completed before it issues a permit. Under some circumstance where access to private property is denied, the applicant will not have access to the property to complete the report until after the permit is issued and the applicant gains access by eminent domain. The Commission will not authorize construction, however, until permittee has complied with all the requirements of NHPA and all other relevant environmental laws.

149. National Grid contends that the Commission should grant requests for waiver of Resource Report 4 if overhead electric lines are on existing rights-of-way. Regardless of the location of the facilities, the Commission will still need to comply with NHPA section 106.

viii. Resource Report 5—Socioeconomics

150. Section 360.16(g) requires that the applicant provide information concerning the impact of the proposed

project on the towns and counties in the vicinity of the project. Section 360.16(g)(2) requires that the applicant evaluate the impact of any substantial immigration of people on governmental facilities and services, and plans to reduce the impact on local infrastructure.

151. EEI states that electric transmission line construction typically does not involve a large influx of workers into an area, so a requirement for an evaluation of the impact of the immigration of people and a fiscal impact analysis evaluating incremental local government expenditures is unnecessary. The construction of any major energy infrastructure facility has the potential to require some influx of workers into the areas. Depending on the facilities available, number of employees, and duration of their stay they may have a major impact on communities. This may especially be the case with the expedited construction we expect for permitted projects.

152. Under § 360.16(g)(7), the applicant is required to conduct a property value impact analysis of the proposed transmission line for residential properties located adjacent to or abutting the right-of-way. Numerous commenters recommended expansion or deletion of the proposed property value impact analysis.

153. EEI requests that the Commission delete the requirement for a property value impact analysis for residential properties located adjacent or abutting to the proposed right-of-way. National Grid asserts that requiring property value impact for these facilities is unwarranted and it would serve only to promote and fuel not-in-my-backyard sentiment. It also contends that assessing property values for virgin right-of-ways would be very time consuming with no tangible benefits.

154. Virginia Electric states that there is no consensus to support a conclusion that transmission lines have any impact on real property values and that the type of property value impact studies in this regulation would overstate, by double-counting, the normal right-of-way cost for the project. SoCal Edison believes such a requirement would be highly subjective and could significantly delay approval of a transmission facility. EEI is concerned that a property value impact study would be highly subjective and could further complicate negotiations and communication between the transmission project sponsor and homeowners in the vicinity of the project. AEP states that the Commission should reconsider requiring this information because it will be time-consuming and the conclusions would be highly speculative.

155. EEI and SoCal Edison assert that there is no similar requirement in the Commission's regulation regarding the siting of other energy infrastructure. SoCal Edison states that such an analysis is not required by NEPA. EEI, National Grid, and SoCal Edison also note that this type of information is not generally required at the state level.

156. Communities request that the analysis include all landowners, residential and commercial, within the entire area of impact and should require a fiscal impact analysis on both local and regional economies. Wilderness recommends that the Commission's analysis use the methods described in “Socio-Economic Framework for Public Land Management Planning: Indicators for the West's Economy”. In addition, it requests that the assessment consider the potential impacts on the values of public lands.

157. After considering the comments raised in this proceeding, the Commission agrees that the property value impact analysis should be eliminated from the Final Rule. The Commission believes that requiring such information could significantly delay the development of transmission projects, which is contrary to the national interest. The Commission also is concerned with the accuracy of such studies and the fact that no uniform methodology is available to calculate the impact of transmission lines on property values. In many cases, such studies could be highly speculative and inaccurate while providing limited beneficial information to the public. Finally, the Commission agrees that there is no particular rationale why such a study should be required when it is not required for other infrastructure projects before the Commission or generally required at the State level.

158. Given the speculative nature of these reports and the time and resources the application would need to dedicate towards completion of this study, the Commission does not believe such a requirement is consistent with the purpose of EPAct 2005. The Commission will consider such information when provided in making a determination on the project, but such information will not be required.

ix. Resource Report 6—Geological Resources

159. Section 350.16(h) requires that the applicant describe geological resources and hazards in the project area that might be directly or indirectly affected by the proposed action or that could place the proposed facilities at risk, the potential effects of those hazards on the facilities, and methods proposed to reduce the effects or risks. National Grid states that this requirement should be eliminated for overhead electric transmission line projects and required only for underground projects, where the nature of the facility makes such analysis relevant and appropriate.

Construction of electric transmission facilities will require the placement of towers subject to substantial loads in areas with potential geological hazards that the Commission would want to take into account in its analysis. Therefore, we will not eliminate this requirement.

DOI requests that Resource Report 6 address impacts to local aquifers or water sources which may supply water to local communities. These impacts are specifically addressed in Resource Report—2—Water use and quality.

x. Resource Report 7—Soils

160. Section 360.16(i) requires that the applicant provide information on the soils that will be affected by the proposed project, the effect on those soils, and measures to minimize or avoid impact. EEI, AEP, and National Grid contend that the Commission should eliminate this requirement because electric transmission projects will have no significant impacts on soil. We disagree. Whenever there is ground disturbance and the possibility of erosion, the Commission needs to determine the potential impact of that activity.

161. DOI recommends that this report include a requirement to identify highly erodible soils. Section 360.16(i)(1) requires that the applicant list the soil associations that would be crossed and describe, among other things, the erosion potential. We think this adequately addresses DOI's concern.

xi. Resource Report 8—Land Use, Recreation, and Aesthetics

162. Section 360.16(j) requires that the applicant describe the existing uses of land within a quarter mile of the edge of the proposed right-of-way and changes to the land use if the project is approved. It also requires that the applicant list all buildings within a half-mile of the center of the proposed right-of-way. Communities state that the Commission should clarify in the regulation that not only must existing land use be evaluated but also all permitted land use. Under § 360.16(j)(3), the applicant is required to provide information on “planned development” in the project area, which is defined as development included in a master plan or on file with local planning authorities and would included permitted land use.

163. DOI requests that this report include identification of the loss of agricultural/grazing property within the project area. Section 360.16(j) requires that the applicant address changes to those land uses that will occur if the project is approved.

164. EEI states that the requirement that the applicant submit information regarding a corridor that is one-half mile wide is unnecessarily broad, and could pose an undue burden on the applicant, and would exceed the study corridor width used in many States. It contends that the appropriate corridor width will vary from State to State depending on topography, the nature of development in the vicinity, and other factors. Therefore, it requests that the Final Rule be modified to permit the applicant to propose a corridor width that takes these factors into account. In the alternative, EEI states that the Final Rule should be modified to require information be provided for a corridor that is 200 feet wide, an approach that it states is consistent with current practice in certain States. Southern raises similar concerns. AEP states that the Commission's land use requirement of a quarter mile would be excessively costly. DOI also requests that the Commission explain the justification for the quarter-mile distance requirement.

165. The Commission believes that it is reasonable to require preliminary information on land uses and inhabited buildings within a half-mile corridor along a proposed transmission line. Having information about such areas from the outset will enable the Commission to more efficiently examine minor routing alternatives or modifications. In some instances, based on a review of the preliminary materials and information gained during the scoping process, the Commission may request additional information.

166. Section 350.16(j)(4) requires that the applicant identify various areas including, among others, sugar maple stands, orchards and nurseries, game management areas, national or State forest, parks, golf courses, or recreational or scenic areas. Massachusetts Energy Board requests that the Commission add cranberry bogs after orchards and nurseries. The Commission will consider additional areas that need to be identified on a case-by-case basis depending on the proposed project.

167. Wilderness requests that the Commission lands managed by the Bureau of Land Management, the National Park Service, and the U.S. Forest Service be specifically listed as requiring information in Resource Report 8. It contends that the regulations should emphasize the protection of the special values of public lands. Section 360.16(j)(4) requires that the applicant identify all lands owned and controlled by Federal or State agencies, as well as land owned by private preservation groups in addition to parks and recreation areas. We believe this sufficiently covers the areas of concern raised by Wilderness in its comment. If Wilderness believes that something was overlooked when an applicant makes a specific filing, it can file comments during the Commission's scoping period.

168. EEI states that the Commission's requirement that the applicant identify Indian Tribes that may attach significance to the project's right-of-way is broad and vague and should be removed. It contends that there are transmission lines that are hundreds of miles long and that it would be difficult to determine the “project vicinity”. EEI asserts that the cultural resources consultations with Native Americans required in § 380.16(f) and the requirement that the applicant identify Native American religious sites and cultural properties in § 380.16(j)(4) should be sufficient to assure that appropriate consideration is given to the impacts on tribal resources of a proposed transmission facility.

169. Affiliated states that the applicant should provide names of all Indian tribes who may have permit authority or the ability to consent to, or withhold consent over, any aspect of the project. Affiliated also asserts that the rule should describe the different interests tribes have in projects, either as permitting and consenting entities inside the external boundaries of reservations, or outside of reservations on tribal traditional lands or cultural places. It should also explicitly cite, describe, and inform other stakeholders of the Commission's tribal obligations, identify treaty rights, and any other tribal interests that may be impacted by the proposed project. Confederated Tribes of the Warm Springs Reservation of Oregon (Confederated Tribes) requests that the Commission require an applicant to identify treaty rights and any other tribal interests that may be impacted by the proposed project in § 380.16(j)(5).

170. As discussed above, the Commission believes that the filing requirements concerning tribal interests under § 360.16(f) and § 360.16(j) and the notification requirements under § 50.4(c) are sufficient to provide the basic information for the Commission to commence its review of a proposed project.

171. Pre-filing is an information gathering process. During this process, Commission staff will work with the applicant to make sure that all interested stakeholders, including any tribes, have been made aware of the proposed project and have had an opportunity for their views and recommendations to be considered. Any issues particular to a proposed project will be raised and evaluated during the pre-filing process. Information developed during the pre-filing process will be made part of the record and will be considered by the Commission as it conducts its review when an application is subsequently filed.

172. Southern contends that the requirement in § 350.16(j)(6) to list all schools, homes, and other structures within one-half mile of a proposed facility and AM radio transmitters within 10,000 feet imposes an enormous burden with no discernible benefit. We disagree. It is more efficient for Commission staff to consider the land use and aesthetic issues within a wider area than to prematurely narrow the focus of the evaluation and scoping process. Any lesser requirement might require the applicant to do a more expansive review later in the process in response to stakeholder comments which could potentially extend the processing time for the proposed project.

173. Section 380.16(j)(11) requires that the applicant describe the visual characteristics of the lands and waters affected by the project. EEI states that significant visual impacts are inherent in virtually all transmission line construction and cannot be avoided or minimized in most cases. Therefore, it argues that the Commission's requirement that the applicant describe how the facilities will impact the visual character of the project right-of-way and list measures to lessen these impacts should be modified to clarify that an applicant must only propose measures to lessen such impacts “to the extent practicable.” The Commission understands that it is difficult to lessen the impact of an electric transmission facility and will consider visual impacts on a case-by-case basis, but nevertheless needs visual impact information to complete its NEPA and public interest analysis.

174. National Grid states that the Commission should change this report to require the applicant to identify and give a general description of the surrounding areas and describe the effect of the proposed project on those areas. A general description of the surrounding areas is not sufficient for the Commission's land use review. As

stated, it is more efficient for the Commission to consider land use issues within a wider area.

xii. Resource Report 9—Alternatives

175. Section 380.16(k) requires that the applicant describe alternatives to the project and compare the environmental impacts of the alternatives. Center for Biological Diversity wants to ensure the full environmental impacts of the alternatives are considered. National Grid states that the Commission should clarify that the applicant is only required to prepare resource reports for proposed projects, not alternatives. American Transmission requests that the Commission specify what is meant by all alternatives, including the identity of the number of alternative routes that must be considered. AEP states that Resource Report 9 would require excessive research, including costly environmental analyses, to be completed on an undefined and seemingly limitless number of alternative routes. Southern states that it is not clear how much information an applicant needs to collect to review and report on alternatives and that it could lead to an enormous burden.

176. For the preliminary reports required at the early stages of pre-filing, the applicant need only submit information that would allow Commission staff to discern reasonable alternatives. As the Commission conducts its site visits and reviews the comments submitted during the scoping period, alternatives will be considered. Once the applicant reaches a decision regarding its final proposed route, it will need to comply with the resource report requirements for that route before the application is filed.

177. Wilderness states that alternatives should be identified to avoid the locations identified in Resource Report 8 or to explain why they could not be avoided altogether. It also requests that a transparent comparison of costs and environmental impacts should be included in this section. The purpose of the Commission's NEPA analysis is to analyze the potential environmental impacts of a proposed project and reasonable alternatives to that project. Section 380.16(k) requires that applicants describe and evaluate alternatives including a discussion of costs and benefits. While the avoidance of impacts to special land use areas is not specifically addressed in the resource report, it will be explored through the course of the NEPA review.

178. APPA states that non-wires alternatives should be thoroughly evaluated “up front” during the interregional planning process and should not be among the alternatives evaluated by the Commission in the construction permit application process. Massachusetts Energy Board, New Jersey BPU, and Pennsylvania PUC all request that the Commission consider alternatives beyond new transmission lines, including configuration and design alternatives, upgrades to existing transmission facilities, and demand side alternatives. Reinhardts suggest the Commission consider “system alternatives” to a proposed project as opposed to just route alternatives. California PUC contends that the Commission should consider alternatives inside and outside the National Corridors and use all the information on alternatives developed in the State siting process. Communities requests that the Commission require the applicant to evaluate all technologically achievable alternatives.

179. NEPA requires the Commission to consider and discuss reasonable alternatives; it does not require consideration of patently unsuitable alternatives.

The Commission's experience in the hydropower and gas pipeline programs is that the range of reasonable alternatives can best be determined based upon the facts of a specific siting proposal. In light of the specific facts raised by individual projects, the applicant will be required to address a variety of alternatives in the resource reports, including, where appropriate, alternatives other than new transmission lines. Moreover, reasonable alternatives can be identified by Commission staff or other stakeholders at various points during the proceeding for consideration in the NEPA process.

See American Rivers

FERC

, 201 F.3d 1186, 1200 (9th Cir. 2000).

xiii. Resource Report 10—Reliability and Safety

180. Section 380.16(l) requires that the applicant address potential hazards to the public and how these will affect reliability. Communities request that the report include an evaluation of homeland security issues and whether the project will result in energy independence. Homeland security related issues will be addressed on a case-by-case basis.

181. Southern states that the Commission should not require an applicant to include a discussion on potential acoustic or electric noise from electric and magnetic fields (EMF). National Grid contends that since these requirements are duplicative of local requirements, the Commission should waive the requirements where the applicant can demonstrate that comparable requirements are being complied with at a local level. As discussed above, an applicant may use any information developed during its planning stage and for the State proceeding to satisfy the Commission's filing requirements. However, it must clearly explain and demonstrate how that information complies with the Commission's specific requirements.

xiv. Resource Report 11—Design and Engineering

182. EEI states that the requirement that the applicant submit detailed design and engineering drawings showing all major project structures is inconsistent with typical industry and State permitting practice which is to only submit pole spotting or spacing information and general consideration of structure type when siting authorization is sought. It states that detailed engineering is then completed after a proposed transmission project is authorized. EEI contends that electric transmission lines are subject to specific field designs along their entire length to accommodate particular circumstances. Therefore, it states it would be more appropriate for the Commission to require the submission of detailed engineering information after a permit is issued rather than beforehand. National Grid states that this requirement should be modified to require only maps of the proposed siting route and drawings depicting the predominate type of structures to be used.

183. The Commission expects the applicant to be able to commence construction when the Commission issues the permit. The applicant can develop its design during the pre-filing phase, but the Commission expects that all design plans should be well-defined when it files its application.

184. Massachusetts Energy Board requests that the Commission require applicants to provide an explanation for any selection of a structure design that is different from structures already present and an explanation of any structure placement that is longitudinally offset from existing structures. Resource Report 1 requires that the applicant describe the facilities associated with the proposed construction. If the Massachusetts Energy Board believes additional information is required for a specific project, it should file comments during the NEPA scoping process and those comments will be addressed in that proceeding.

c. Exhibit G—Engineering Data

185. The Commission requires specific engineering data to support its review of a proposed transmission line in Exhibit G. National Manufacture's contend that flexibility should be allowed in the permit application facilities description because the design will probably not be finalized at the time of permit application. It also notes that filings have historically been made 5 to 10 years before the final design is completed. The Commission expects that the applicant will be prepared to commence construction when the permit is issued. Thus, it will need to have all its final designs completed prior to when the Commission issues an order on the merit of a proposed project.

186. Massachusetts Energy Board states that the Commission should require applicants to provide: (1) Existing and expected EMF cross-sectional profiles for points along a proposed project and identify any low-cost mitigation of EMF; (2) information on interference with existing cathodic protection systems; (3) an analysis of noise levels: (4) engineering data on substations and switching station that would be constructed or altered in connection with the transmission line project; and (5) any other information that has been identified as a requirement component of siting review or of an application to construct in the State in which the facility will be located. DOI also requests the Commission review the potential environmental impact of noise.

187. The information Massachusetts Energy Board and DOI recommend the Commission should require applicants to provide is already required by Resource Report 10. Should other pertinent information be identified during the State siting process, this information may be filed for consideration by the Commission.

d. Exhibit H—System Analysis Data

188. Exhibit H requires information to evaluate the impact the proposed facilities will have on the existing electric transmission system performance, including an analysis of existing and expected congestion, power flow cases which include contingency data files, a list of assumptions and guidelines used in the cases, a stability analysis, a short circuit analysis and a concise analysis that explains how system reliability will be improved, how long-term regional planning is impacted and how congestion will be impacted on the applicant's entire system.

189. Communities state that system analyses should include all relevant reliability assessments completed by State commissions, ISO, RTO, energy service companies and the like. New Jersey BPU states that the Commission analysis should include input from a RTO/ISO (if applicable) because they are in the best position to analyze the impact new facilities will have on overall system performance. In determining whether to issue a permit to construct the proposed facilities, the Commission will review all processes that were conducted by the applicant with the relevant stakeholders in determining whether to approve the proposed facilities, including input from RTOs and ISOs.

190. Reinhardts contend that the Commission must consider how interstate transmission will impact electricity available to individual States and regions. They state that the Commission's rules must include data requirements that would shed light on potential reliability issues. They also assert that the rules should: (1) Require full disclosure of all electric generation (new or existing) for which the new transmission facilities have been proposed; (2) require that alternatives to the proposed transmission include alternative electric generation scenarios; and (3) require a detailed analysis of all impacts that would be imposed by construction of the desired interstate transmission resources that are expected to feed into the new transmission facilities to meet identifiable power needs. APPA and PJM suggest more details concerning the reliability criteria the Commission will use to approve projects. PSEG Companies and APPA contend that there is a need for a broad congestion analysis.

191. The Commission anticipates that DOE will designate corridors to help connect existing generation to load. In most cases, the proposed project will be limited to transmission facilities designed to achieve this purpose. The Commission's decision on the proposed project will take into account the applicant's submitted reliability and systems analysis, an analysis of alternatives, and an analysis of project impacts as required by NEPA. Additionally, based on the specific issues that arise in individual projects, the Commission may request additional information to assure that the proposed project is in compliance with any Commission-approved reliability standard.

e. Exhibit I—Project Cost and Financing

192. Exhibit I requires general information concerning the cost of the proposed project. Communities state that the applicant should provide a detailed analysis of the projected cost impact on customers both inside and outside the National Corridors. California PUC states that the description of project financing should identify the specific mechanisms by which the applicant will seek cost recovery, what categories of ratepayer costs would be recovered from, and what rate or other incentives the applicant proposes to seek. It contends that this will provide adequate transparency regarding the financial impact of the project on the State or region.

193. Cost recovery and the effect on customer rates are not part of the proceeding to issue a construction permit. The Commission will address issues related to the costs associated with the proposed facilities in separate rate proceedings filed under FPA section 205.

Any concerns about cost recovery should be raised in those proceedings.

See, e.g., Allegheny Energy, Inc.

, 116 FERC ¶ 61,058 (2006),

American Electric Power Service Corp.

, 116 FERC ¶ 61,059 (2006).