[Federal Register Volume 61, Number 48 (Monday, March 11, 1996)]
[Rules and Regulations]
[Pages 9613-9637]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-5165]
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DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
18 CFR Part 154
[Docket No. RM95-3-001; Order No. 582-A]
Filing and Reporting Requirements for Interstate Natural Gas
Company Rate Schedules and Tariffs Final Rule; Order on Rehearing
Issued: February 29, 1996.
AGENCY: Federal Energy Regulatory Commission, DOE.
ACTION: Final rule; Order on rehearing.
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SUMMARY: The Federal Energy Regulatory Commission is issuing an order
on the requests for rehearing of Order No. 582, the final rule amending
part 154 of the Commission's regulations under the Natural Gas Act.
That order adopted procedural rules governing the form and composition
of interstate natural gas pipeline tariffs and the filing of rates and
charges for the transportation of natural gas in interstate commerce
under sections 4 and 5 of the Natural Gas Act (NGA) and section 311 of
the Natural Gas Policy Act. Also, minor modifications to the electronic
filing instructions for tariff sheets are added as an appendix.
EFFECTIVE DATE: The revised regulations will become effective April 10,
1996.
FOR FURTHER INFORMATION CONTACT: Richard A. White, Office of the
General Counsel, Federal Energy Regulatory Commission, 888 First
Street, NE., Washington, DC 20426, (202) 208-0491.
SUPPLEMENTARY INFORMATION: In addition to publishing the full text of
this document in the Federal Register, the Commission also provides all
interested persons an opportunity to inspect or copy the contents of
this document during normal business hours at 888 First Street, NE.,
Washington, DC 20426.
The Commission Issuance Posting System (CIPS), an electronic
bulletin board service, provides access to the texts of formal
documents issued by the Commission. CIPS is available at no charge to
the user and may be accessed using a personal computer with a modem by
dialing (202) 208-1397 if dialing locally or 1-800-856-3720 if dialing
long distance. To access CIPS, set your communications software to
19200, 14400, 12000, 9600, 7200, 4800, 2400, or 1200 bps, full duplex,
no parity, 8 data bits, and 1 stop bit. The full text of this document
will be available on CIPS indefinitely in ASCII and WordPerfect 5.1
format. The complete text on diskette in Wordperfect format may also be
purchased from the Commission's copy contractor, La Dorn Systems
Corporation, also located in the Public Reference Room at 888 First
Street, NE., Washington, DC 20426.
This order grants, in part, and denies, in part, requests for
rehearing of Order No. 582 (Rule).1 That order adopted procedural
rules governing the form and composition of interstate natural gas
pipeline tariffs and the filing of rates and charges for the
transportation of natural gas in interstate commerce under sections 4
and 5 of the Natural Gas Act (NGA) and section 311 of the Natural Gas
Policy Act. Also, minor modifications to the electronic filing
instructions for tariff sheets are added as an appendix.
\1\ Filing and Reporting Requirements for Interstate Natural Gas
Companies Rate Schedules and Tariffs, Order No. 582, 60 FR 52960
(October 11, 1995), II FERC Stats. & Regs. para. 19,100-19,183
(1995)(regulatory text), III FERC Stats. & Regs. para. 31,025
(1995)(preamble). This order on rehearing is a companion to the
order on rehearing, issued concurrently in Docket No. RM95-4-001,
which concerns amendments to, among other things, the Uniform System
of Accounts and FERC Form No. 2. Revisions to Uniform System of
Accounts Forms, Statements, and Reporting Requirements for Natural
Gas Companies, Order No. 581, 60 FR 53019 (October 11, 1995), 72
FERC para. 61,301 (1995).
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I. Background
On September 28, 1995, the Commission issued Order No. 582, the
final rule in Docket No. RM95-3-000 revising part 154, Chapter I, Title
18, Code of Federal Regulations. 2 This order responds to requests
for rehearing or clarification of the Rule filed by Amoco Production
Company, et al. (Amoco), American Forest and Paper Association, ANR
Pipeline/Colorado Interstate Gas Co.(ANR/CIG), Associated Gas
Distributors (AGD), Chevron, U.S.A. Inc. et al. (Chevron), Colorado
Interstate Gas Company, Columbia Gas Transmission/Columbia Gulf
Transmission, Great Lakes Gas Transmission (Great Lakes), Interstate
Natural Gas Association of America (INGAA), JMC Power Projects, Natural
Gas Supply Association (NGSA), Mississippi River Transmission Co.
(MRT), Natural Gas Clearinghouse, Natural Gas Supply Association
(NGSA), Panhandle Eastern Pipe Line, Texas Eastern Transmission Corp.,
and Williston Basin Interstate Pipeline Company.
\2\ Filing and Reporting Requirements for Interstate Natural Gas
Company Rate Schedules and Tariffs, 60 FR 3111 (January 13, 1995),
IV FERC Stats. & Regs. para. 32,511 (1995).
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II. Discussion
a. Section 154.1 Application; Obligation to File
1. Requests for Rehearing
Section 154.1(d) requires that any executed service agreement which
deviates in a material aspect from the form of service agreement in a
pipeline's tariff must be filed with the Commission. 3 This
requirement codified existing Commission policy. 4
\3\ Section 154.1, Application; Obligation to file, requires:
(b) Every natural gas company must file with the Commission and
post in conformity with the requirements of this part, schedules
showing all rates and charges for any transportation or sale of
natural gas subject to the jurisdiction of the Commission, and the
classifications, practices, rules, and regulations affecting such
rates, charges, and services, together with all contracts related
thereto.
(d) For the purposes of paragraph (b) of this section, any
contract that conforms to the form of service agreement that is part
of the pipeline's tariff pursuant to Sec. 154.110 does not have to
be filed. Any contract or executed service agreement which deviates
in any material aspect from the form of service agreement in the
tariff is subject to the filing requirements of this part.
\4\ See, Tennessee Gas Pipeline Company, et al., 65 FERC para.
61,356 (1993); reh'g denied, 67 FERC para. 61,196 (1994).
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Amoco argues that the Rule violates section 4(c) of the NGA by
allowing the interstate pipelines to make substantive deviations from
pro forma contracts without honoring the statutory and regulatory duty
to file contracts with the Commission so that the public and shippers
can determine whether or not they have been subjected to undue
discrimination.5
\5\ The Commission has included as Sec. 154.1(b) the description
of the purpose of part 154, which reflects the requirement of
Section 4(c) of the NGA that every natural gas company must file
with the Commission, and maintain open for public inspection, its
schedules and contracts. 15 U.S.C. Sec. 717c(c).
[[Page 9614]]
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Amoco states that the regulatory text is correct as a matter of law
and policy. However, Amoco states that the Commission eviscerated the
regulation by not defining ``materiality,'' and eliminating the items
most likely to be the instrument of undue discrimination and unjust and
unreasonable terms and conditions from qualification as ``material
deviations.'' Amoco took the items listed in the Preamble as not likely
to trigger a filing, and argues that, under certain circumstances,
unfair discrimination could occur.
Amoco states that any material deviations from the tariff (which
include those items excluded by dicta in Order No. 582) should be filed
in order to be sure that there is no undue discrimination.
2. Commission Response
The use of forms of service agreements as the basis of contracts
between a pipeline and its customers ensures that there are no
unreasonable differences among the pipeline's customers as to the
rates, charges, services, or facilities, while minimizing the amount of
paper filed with the Commission. A contract that conforms to a pro
forma service agreement need not be filed with the Commission because
the Commission has already considered and determined that the pro forma
service agreement is just and reasonable. Any contract that deviates in
a material way from a pro forma service agreement must be evaluated
anew to determine that it is not unjust, unreasonable, unduly
preferential, or otherwise unacceptable.
Many commenters to the NOPR requested the Commission to be more
specific as to what deviations or substantive additional provisions
will trigger this filing requirement.6 To accommodate these
requests the Preamble gave examples of provisions that would not
normally be expected to be ``material'' deviations.7
\6\ For example, Columbia requested that the Commission clarify
that specifically drafted provisions addressing flow rates, pressure
obligations, maximum delivery obligations, term, and other ``tariff-
contemplated'' items are not ``material'' deviations. Amoco, et al.,
requested that the Commission clarify ``material deviations,'' such
that contracts must be filed which provide for any difference (from
that specified in the tariff) in maximum rates, rate design,
balancing provisions, penalties, operational flexibility, or any
other variation. On the other hand, IPAA stated that the legal
concept of materiality may depend upon ``where one resides in the
food chain'' and suggested that all deviating agreements be filed.
\7\ III FERC Stats. & Regs. para. 31,025 at 31,385.
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The Commission will clarify the prior order. To illustrate, a pro
forma service agreement may contain blanks to be filled in, or ranges
for terms of service (such as 950-1100 psi). A contract would be
consistent with the tariff if, for example, it was completed by filling
in the blanks or included terms that fall within the prescribed ranges.
There is no need to burden the pipeline with filing all contracts that
conform to the pro forma agreement that has been filed and approved by
the Commission as a part of the tariff. Of course, where a contract
conflicts with the tariff, the tariff controls until the contract is
filed and accepted by the Commission. Thus, any contract which is not
consistent with the pro forma service agreement must be filed with the
Commission. The Commission is continuing to consider in another
proceeding how much flexibility in contract terms should be permitted.
On January 31, 1996, the Commission issued a policy statement that it
is willing to entertain, on a shipper-by-shipper basis, requests to
implement negotiated rates where customers retain the ability to choose
a cost-of-service based tariff rate as a recourse.8 In that policy
statement the Commission established a proceeding in Docket No. RM96-7-
000 to explore how much flexibility could be permitted, although it is
likely in any event that case-by-case application will be necessary.
\8\ Statement of Policy and Request for Comments in Docket Nos.
RM95-6-000, Alternatives to Traditional Cost-of-Service Ratemaking
for Natural Gas Pipelines; and, RM96-7-000, Regulation of Negotiated
Transportation Services of Natural Gas Pipelines, 74 FERC para.
61,076 (1996).
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b. Section 154.4 Electronic and Paper Media
New Sec. 154.4 requires electronic media filings in addition to
paper copies.9 Section 154.4(a) states that a pipeline must file
information contained in spreadsheet format electronically and continue
to serve customers with paper copies of filings, but it does not
require a pipeline to provide such information to its customers in an
electronic format.
\9\ Section 154.4 provides, in pertinent part:
(a) General rule. All statements filed pursuant to subpart D of
this part, and all workpapers in spreadsheet format, and tariff
sheets other than those in Volume No. 2, must be submitted on
electronic media.
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APGA requests clarification that a pipeline must, upon request,
provide such spreadsheet information, including all formulas embedded
in the spreadsheet, to its customers in an electronic medium. In the
alternative, APGA requests rehearing of this issue.
In the Rule, the Commission adopted a tab delimited ASCII format
for most numeric data and a format compatible with the filing company's
spreadsheet application for Statements I, J, and those parts of
Statement H containing state tax calculations.10 To the extent
APGA's request seeks to expand the use of the format compatible with
the filing company's spreadsheet application to other statements, the
request is denied. The Commission adopted the tab delimited format as
the default for numeric data because it was recommended by several
parties in comments to the NOPR. It is also a more generic format
capable of being read or created by several software packages. This
allows greater access to the data to the general public without
imposing the burden of buying and learning to use numerous proprietary
spreadsheet packages. Since statements other than statements I, J, and
parts of H do not generally contain complex formulae, the loss of the
formulae will not impair review of the data.
\10\ III FERC Stats. & Regs. para. 31, 025 at 31,435.
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APGA's second request, that the electronic data be available from
the pipeline if requested, is addressed in section II.i.5 of this
order.
c. Section 154.5 Rejection of Filings
Section 154.5 states that filings that fail to comply with part 154
regulations may be rejected by the Director of the Office of Pipeline
Regulation (Director) pursuant to the authority delegated to the
Director in Sec. 375.307(b)(2).11
\11\ Section 154.5 states:
A filing that fails to comply with this part may be rejected by
the Director of the Office of Pipeline Regulation pursuant to the
authority delegated to the Director in Sec. 375.307(b)(2) of this
chapter.
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1. Requests for Rehearing
INGAA argues that the regulation does not give sufficient guidance
to the Director as to how to exercise this authority, even if this
authority has not been changed or augmented by the Rule. INGAA seeks
clarification that only patently deficient rate case filings can be
rejected and that Staff would be required to make such a determination
within 15 days of the filing date. INGAA states that this would give
applicants and intervenors a level of assurance that a rate case filing
will proceed on time under the indicated filing date, thus avoiding
confusion as to when new rates would go into effect. Under INGAA's
plan, if lesser deficiencies were found, the applicant would have 30
days to rectify such deficiencies.
ANR and CIG request that the Commission clarify that so long as
there is no ``patent failure'' to comply with the Commission's
requirements, any deficiency may be cured by the pipeline and the
filing date will be the effective date of the filing.
ANR and CIG further request that the Commission reconsider the
decision not
[[Page 9615]]
to set forth a procedure that would be followed if a filing is deemed
not in compliance with the Commission's filing requirements.
Specifically, ANR and CIG suggest that the Commission notify a pipeline
in writing within 12 days of filing of a rate case of any deficiencies
in the filing and allow the pipeline ten days to correct the deficiency
or request a waiver of a filing requirement. ANR and CIG state that
this procedure would still allow the Commission to act within 30 days
of the pipeline's filing of the rate case. To the extent there is a
change or addition to the filing, ANR and CIG suggest that intervenors
and protestors be permitted to supplement their filings. ANR and CIG
state that this procedure is consistent with the 12 day period in which
interested parties may intervene, comment or protest under
Sec. 154.210.
2. Commission Response
Section 154.5 merely sets out, in the rate and tariff filing
requirements, the existing power of the Director to reject tariff or
rate schedule filings.12 Section 154.5 signals the Commission's
intent to have the Director reject filings that do not comply with the
filing requirements promulgated by this order.
\12\ Section 375.307 delegates to the Director of the Office of
Pipeline Regulation the authority to reject a tariff or rate
schedule or filing if it patently fails to comply with applicable
statutory requirements, and with all applicable Commission rules,
regulations, and orders for which a waiver has not been granted.
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To the extent that the requests for clarification only seek
assurance that the regulation does not delegate any new power to the
Director, they are granted. However, any specific guidelines or
procedures to be followed by the Director in exercising this authority
must be set out in part 375, not in the pipeline filing requirements.
The purpose of the regulation is to indicate that the Director's
power is to reject a filing based on the procedural inadequacy of the
filing, not the substance. Only the Commission rejects on the basis of
substance. When a rate filing is procedurally correct but is not
sufficient to determine just and reasonableness, the appropriate action
is for the Commission to reject the filing on the merits or to accept
the filing but suspend the proposed rates pending a hearing. To the
extent a filing does not include the information required by the
regulations and is so deficient that it prejudices the Commission in
the discharge of its duty to decide whether or not to investigate or
suspend the increased rates, the Commission expects the Director to
reject the filing.
d. Section 154.7 General Requirements for the Submission of a Tariff
Filing or Executed Service Agreement
Section 154.7 is a new section setting forth the content of a
tariff filing or executed service agreement.13
\13\ Section 154.7 states, in pertinent part:
The following must be included with the filing of any tariff,
executed service agreement, or part thereof, or change thereto.
(a) A letter of transmittal containing:
* * * * *
(6) a statement of the nature, the reasons, and the basis for
the filing. The statement must include a summary of the changes or
additions made to the tariff or executed service agreement, as
appropriate. A detailed explanation of the need for each change or
addition to the tariff or executed service agreement must be
included. The natural gas company also must note all relevant
precedents relied upon to prepare its filing.
* * * * *
(9) a motion, in case of minimal suspension, to place the
proposed rates into effect at the end of the suspension period; or,
a specific statement that the pipeline reserves its right to file a
later motion to place the proposed rates into effect at the end of
the suspension period.
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1. Transmittal Letter to Contain Quantified Summary
Section 154.7(a)(6) requires the letter of transmittal to contain a
statement of the nature, the reasons, and the basis for the filing. The
statement must include a summary of the changes or additions made to
the tariff or executed service agreement, as appropriate.
NGSA believes that the abbreviated form of the filing should
contain a quantified summary of the proposed changes as well as a
narrative summary. NGSA states that Sec. 154.7(a)(6) should require a
table or listing of the cost of service, rate base and throughput
underlying the proposed rates compared to the same information
underlying the last rate found by the Commission to be just and
reasonable. NGSA argues that such information would enable parties to
readily ascertain the magnitude and the sources of the changes being
proposed and, thus, negate the need on the part of many parties to
receive a copy of the full filing. NGSA states that adding this small
amount of quantified information to the abbreviated filing could reduce
the number of full filings the pipelines are requested to provide.
This request for rehearing is granted. The burden to the pipeline
to provide the additional summary would be minimal. Although NGSA
suggests that the information could reduce requests for full filings,
the Commission accepts that, in some cases, the quantification summary
may engender additional requests for full filings. Nonetheless,
considering the short time period in which the Commission and
interested parties have to review the filing, this additional
information would, in most cases, speed processing and reduce requests
for additional information or complete filings. The regulations will be
amended such that a filing under subpart D requires a table or listing
of the cost of service, rate base and throughput underlying the
proposed rates compared to the same information underlying the last
rate found by the Commission to be just and reasonable.
2. Motion to Place Reduced Rates Into Effect
i. Request for rehearing. Section 154.7(a)(9) requires that the
transmittal letter contain either a motion, in case of minimal
suspension, to place the proposed rates into effect at the end of the
suspension period; or a specific statement that the pipeline reserves
its right to file a later motion to place the proposed rates into
effect at the end of the suspension period.
JMC Power Projects states that the new regulation grants the
pipeline the option as to when to file a motion to place suspended
rates into effect--either in its initial letter of transmittal or
later. JMC Power Projects argues that a pipeline proposing to decrease
its rates admits that its current rates are unjust and unreasonable and
has an incentive to delay placing suspended decreased rates into
effect.
JMC Power Projects seeks clarification that the motion of the
pipeline to place suspended rates into effect pursuant to
Sec. 154.206(b) is the same motion to be filed as part of the
transmittal letter pursuant to Sec. 154.7(a)(9), and that the pipeline
must file a motion to place the proposed rates into effect at the end
of the suspension period. In the alternative, JMC Power Projects seek
rehearing and requests that the Commission find that when a pipeline
proposes a rate decrease, either no motion is necessary for the rates
to go into effect or, if a motion is necessary, the pipeline must file
a motion to place the suspended rates into effect at the end of the
minimal suspension period.
JMC Power Projects states that its interpretation of the new
regulations to the effect that a pipeline is required to file a motion
to place reduced rates into effect at the end of the suspension period
is consistent with past Commission practice. JMC Power Projects states
that allowing a pipeline to delay placing decreased rates into effect
beyond the minimal suspension period is unjust and unreasonable,
particularly when customers in such a situation are not afforded refund
protection.
ii. Commission response. JMC Power Projects is correct in stating
that
[[Page 9616]]
pipelines have an option to file a motion to place suspended rates into
effect either in the letter of transmittal or later. Also, the motion
of the pipeline referred to in Sec. 154.206(b) is the same motion
referred to in Sec. 154.7(a)(9).
However, the requested clarification that a pipeline is required to
file a motion to place reduced rates into effect at the end of the
suspension period is denied. The request is, in effect, asking for a
special rule to govern proposed rate decreases. This is unnecessary as
the revised regulation is consistent with the purposes of the NGA.
Section 4(e) of the NGA authorizes the Commission to suspend
operation of a schedule and defer the use of a rate pending a hearing
``but not for a longer period than five months beyond the time when it
would otherwise go into effect.'' \14\ If the proceeding has not been
concluded and an order made at the expiration of the suspension period,
the proposed change shall go into effect ``on motion of the natural gas
company making the filing.'' \15\ The Act requires the motion;
otherwise, the rates do not go into effect.
\14\ 15 U.S.C. 717c(e).
\15\ Id.
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As a practical matter, where rates have been suspended for a
minimal period as allowed under the statute, a hearing could not
possibly be concluded by the expiration of the period.
The NGA states that refunds may be ordered ``where increased rates
or charges are thus made effective.'' \16\ Historically, the Commission
has considered the suspension of a rate as a necessary step to assure
that refunds may be ordered when appropriate. The refund is appropriate
where the Commission ultimately determines that the proposed rate moved
into effect at the end of the suspension period (motion rate) is too
much of an increase over the last rate found to be just and reasonable
(the refund floor). Thus, no refund is possible where a decrease is
proposed. Even where the Commission ultimately finds that the rates
should have been decreased further than proposed, the motion rate would
be less than the refund floor.
\16\ Id.
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Usually the Commission accepts a proposed rate decrease without
suspension. Where the Commission does not suspend the effective date of
a proposed decrease, a section 4(e) motion is not required and the
proposed decrease goes into effect on the date proposed by the pipeline
in its filing. However, it may be appropriate, under certain
circumstances to suspend a rate decrease and in such instances a motion
to place the rates into effect would be required; for example, where it
may not be clear initially if it is a rate decrease due to pancaked
cases. Thus, the Commission will retain this option. Accordingly, the
request for clarification that a pipeline is required to file a motion
to place reduced rates into effect at the end of the suspension period,
is denied.
3. Effective Date After Minimal Suspension
ANR and CIG believe that in situations where the suspension period
is likely to be minimal, pipelines will file the motion to place
proposed rates into effect with the transmittal letter to ensure that
the rates will be effective as soon as the suspension period ends. ANR
and CIG ask whether it was the Commission's intent that, where the
pipeline had reserved its right to file a later motion, the pipeline
would lose a day or several days before rates were effective. If so,
ANR and CIG request clarification and rehearing.
The request for rehearing is denied. A suspended rate may not go
into effect prior to the motion of the pipeline. The procedures for
motioning rates into effect after suspension are the same regardless of
the length of the suspension period. NGA section 4(e) \17\ requires
that suspended rates are to go into effect ``on motion'' of the
pipeline, not before the motion is made. Former Sec. 154.67(a) read
that the proposed rate ``shall become effective as of the date of
receipt of such motion by the Commission or the expiration of the
suspension period, whichever is later.'' Therefore, where the pipeline
includes a motion in its filing and the proposed rates are suspended
for a minimal period, the rates will become effective on the date
proposed. Where the pipeline reserves its right to file a later motion
and the rates are suspended for a minimal period, the rates will go
into effect, later, on motion of the pipeline, as is required by the
NGA.
\17\ 15 U.S.C. Sec. 717c(e).
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4. Quarterly List of Tariff Sheets
In its Initial Comments, AGD recommended a general reporting
obligation for a pipeline to provide to its customers, quarterly, a
list of currently effective tariff sheets, whether or not the pipeline
files any rate increase applications. The Rule states that AGD's
suggested summary appears in Sec. 154.7 and thus, what AGD seeks is
already required. AGD maintains on rehearing that its recommendation
has not been satisfied by the indicated regulation nor by any other
part of Order No. 582.
Many pipelines voluntarily provide their customers with such a
list. However, the Commission declines to burden all pipelines with
this obligation. Customers may keep abreast of developments affecting
pipeline services by monitoring the ``summary of changes or additions
made to a tariff'' required by Sec. 154.7(a)(6) when a pipeline files
for a change. Further, this information is available to the public on
the Commission's bulletin board system by accessing the FERC Automated
System for Tariff Retrieval (FASTR).
e. Section 154.101 Form
Williston Basin points out that Sec. 154.101 contains a
typographical error. As written, it requires that the paper copy of a
tariff sheet be reproduced on 8\1/2\ by 11 inch sheets of paper with
margins of \1/4\ inches on the top, bottom, and left sides, and a
margin of \1/2\ inch on the right side. The NOPR stated that there is
to be a 1 and \1/4\ inch margin on the left side of the sheet.
Williston Basin is correct. The regulation has been modified to
require that the margins on the top, left, and bottom of the tariff
sheet must be 1\1/4\ inches.
f. Section 154.107 Currently Effective Rates
New Sec. 154.107 governs the tariff sheets setting forth the
natural gas company's currently effective rates. Section 154.107(b)
requires that all rates be stated in thermal units.\18\
\18\ Section 154.107(b) provides that ``[a]ll rates must be
stated clearly in cents or dollars and cents per thermal unit. The
unit of measure must be stated for each component of a rate.''
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1. Requests for Rehearing
Great Lakes requests clarification or rehearing on the grounds that
sufficient time is needed to permit pipelines to identify and resolve
the issues related to conversion to thermal units, and to modify
existing contractual and tariff provisions where the current
arrangements are in volumetric units. Great Lakes states that the
contractual changes necessary to fully convert to thermal rates may
result in a reallocation of costs to effectuate the change in rates.
Great Lakes requests clarification that conversion to thermal units
can be implemented through a compliance filing made under Sec. 154.203;
and, that any rates restated in thermal units can utilize the cost of
service and billing units (converted to dekatherms) underlying the
filing pipeline's currently effective rates.
Chevron, USA Inc., and Shell Western E&P Inc. (Designated Shippers)
argue
[[Page 9617]]
that to require a change in these rates, the Commission must find
substantial evidence that stating rates on an Mcf basis is no longer a
just and reasonable practice.\19\
\19\Designated Shippers cite to Mobil Oil Corp. v. FPC, 483 F.2d
1238 (D.C. Cir. 1973).
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The Rule states that the Commission ``does not intend to actively
enforce this section until one year after the effective date of this
rule.'' \20\ Designated Shippers maintain that this delay in
enforcement does not adequately address the hardships faced by these
shippers or give the affected parties a forum to address the
significant factual determinations that will have to be made in
converting rates and capacity entitlements from Mcf units to a thermal
basis. Designated Shippers state that these determinations are all the
more critical on pipelines where the heating value of the gas varies
widely from receipt point to receipt point, and where contract
capacity, denominated in Mcf units, will have to be converted.
Designated Shippers argue that the proper forum for determining these
facts is an individual pipeline rate case.
\20\ III FERC Stats. & Regs. para. 31,025 at 31,392.
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If the Commission does not grant rehearing, Designated Shippers
request clarification that implementing Order No. 582 will not require
an effective rate increase for any individual shipper or result in the
infringement of any shipper's contract rights. Designated Shippers
state that if a conversion is made at the average Btu factor being
shipped through the pipeline, some shippers will benefit, and other
shippers will be harmed.
2. Commission Response
The Commission is committed to standardization of business
practices in the natural gas industry. Most recently, the Commission
underscored that commitment in its advance notice of proposed
rulemaking for standards for business practices of interstate natural
gas pipelines:
As a result of restructuring, the gas industry is becoming a
national marketplace. In order to establish a more efficient and
seamless pipeline grid, where buyers can easily and efficiently
obtain and transport gas from all potential sources of supply, the
development of standardized methods of conducting business along
with standardized methods of communication is critical. Without
common business practices and a common language for communication,
the speed and efficiency with which shippers can transact business
across multiple pipelines is now, and will continue to be, severely
compromised. The industry must expeditiously complete
standardization of crucial business practices to make the promise of
a restructured and integrated pipeline grid a reality. Accordingly,
the Commission intends to establish, by rule, standards governing
pipelines' conduct of crucial business practices and the electronic
means by which pipelines will exchange information with their
customers and third-parties.\21\
\21\ 73 FERC para. 61,104 (1995).
At a conference held on September 21, 1995, to examine the
industry's progress towards standardization, one participant pointed
out the failure of the industry to decide on whether to require
nominations to be reported in Mcf or MMBtu as an example of the lack of
standardization in the industry.\22\ The Commission's adoption of the
provision at Sec. 154.107 requiring rates to be stated in MMBtu or Dth
is an outgrowth of its conviction that standardized business practices
are essential to an integrated national pipeline grid.
\22\ Id. at 61,323.
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Further, staff reviewed the tariffs of 11 pipelines which state
rates exclusively on the basis of Mcf. All but three assure redelivery
of thermally equivalent volumes. In other words, the pipeline
redelivers a sufficient volume (in Mcf) to ensure the natural gas
delivered contains the same heating value as the natural gas received.
In this case, there is no guarantee that the volume (in Mcf) delivered
will exactly equal the volume (in Mcf) received. The requirement that
natural gas be redelivered in thermally equivalent volumes underscores
the nature of the commodity being traded. Natural gas is of worth
because of its heating content. The true commodity is the heating value
of the natural gas. Rates should be reflective of the true commodity
traded.
Stating rates in MMBtu or Dth as opposed to Mcf could cause some
shippers to pay higher rates, but any such proposed rate changes will
not be made without Commission review to ensure they are just and
reasonable. All pipelines making the switch must file appropriate
revisions to their tariffs. At that time, parties can raise their
concerns about paying higher rates as a result of conversion to thermal
units. All such concerns will be addressed when the Commission
determines whether the proposed rates are just and reasonable. All
issues regarding implementation of Sec. 154.107(b) can be addressed in
the individual proceeding to effectuate the new thermal rates.
Therefore, the Commission will not grant rehearing.
We grant Great Lakes' request for clarification that a pipeline may
file to state its rates on a thermal basis under Sec. 154.107 without
filing a major rate case filing under subpart D.\23\
\23\ Trailblazer Pipeline Company and Canyon Creek Compression
Company have filed to restate their rates on a thermal basis in
compliance with Order No. 582. Neither did so in a general rate
proceeding.
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g. Section 154.109 General Terms and Conditions
Section 154.109 requires that a pipeline set forth in its tariff
its discount policy and the order in which each pipeline charge will be
discounted.\24\ The Rule stated that Sec. 154.109(c) merely formalizes
the Commission's policy on recognition of discounts as enunciated in
Natural.\25\
\24\ Section 154.109(c) provides:
The general terms and conditions of the tariff must contain a
statement of the order in which the company discounts its rates and
charges. The statement, specifying the order in which each rate
component will be discounted, must be in accordance with Commission
policy.
\25\ III FERC Stats. & Regs. para. 31,025 at 31,394 (citing
Natural Gas Pipeline Company of America (Natural), 69 FERC para.
61,029, (1994), reh'g, 70 FERC para. 61,317 (1995)). Under the
policy, ``[t]he first item of the overall reservation charge
discounted will be the GRI surcharge (for member pipelines),
followed by the base rate reservation charge, Account No. 858 or
other transition cost surcharges, and last, all GSR reservation
surcharges. Other non-transition reservation surcharges will be
attributed as agreed by the pipeline and its customers in individual
proceedings.'' 69 FERC at 61,117 n.23.
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PEC seeks clarification that the decision in Natural left
individual pipelines free to argue, based on their individual facts and
circumstances, that the order of discounting in Natural did not apply.
INGAA seeks clarification, or in the alternative rehearing, that this
provision does not apply to existing tariff provisions that provide for
a permanent discount mechanism negotiated between parties in a previous
regulatory proceeding. The Commission clarifies that if a pipeline's
tariff contains an existing provision governing the order of discounts,
accepted by the Commission, no modification to the tariff provision is
required under Sec. 154.109. The Commission further clarifies that a
pipeline, in a filing to comply with this section, may attempt to show
that an order of discounting other than that set forth in Natural
should apply.
h. Section 154.206 Motion to Place Suspended Rates Into Effect
1. Effective Date Where Modifications are Ordered
Section 154.206(a) requires that, when rates have been suspended
for more than a minimal period and the Commission has ordered changes
or the rates include costs of facilities that are not in service, the
motion to place suspended tariff sheets into effect must
[[Page 9618]]
be filed at least one day prior to the date the sheets are to take
effect.\26\
\26\ Section 154.206 states, in pertinent part:
Sec. 154.206 Motion to place suspended rates into effect
(a) If, prior to the end of the suspension period, the
Commission has issued an order requiring changes in the filed rates,
or the filed rates recover costs for facilities not certificated and
in service as of the proposed effective date, in order to place the
suspended rates into effect, the pipeline must file a motion at
least one day prior to the effective date requested by the pipeline.
The motion must be accompanied by revised tariff sheets reflecting
any changes ordered by the Commission or modifications approved by
the Commission during the suspension period under Sec. 154.205. The
filing of the revised tariff sheets must:
(1) comply with the requirements of subparts A, B, and C of this
part;
(2) identify the Commission order directing the revision;
(3) list the modifications made to the currently effective rate
during the suspension period, the docket number in which the
modifications were filed, and identify the order permitting the
modifications.
(b) Where the Commission has suspended the effective date of a
change of rate, charge, classification, or service for a minimal
period and the pipeline has not included a motion in its transmittal
letter, or has specified in its transmittal letter pursuant to
Sec. 154.7(a)(9), that it reserves its right to file motion to place
the proposed change of rate, charge, classification, or service into
effect at the end of the suspension period, the change will go into
effect, subject to refund, upon motion of the pipeline.
(c) Where the Commission has suspended the effective date of a
change of rate, charge, classification, or service for a minimal
period and the pipeline has included, in its transmittal letter
pursuant to Sec. 154.7(a)(9), a motion to place the proposed change
of rate, charge, classification, or service into effect at the end
of the suspension period, the change will go into effect, subject to
refund, on the authorized effective date.
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i. Requests for rehearing. AGD is concerned that the regulations do
not adequately assure pipeline compliance with whatever conditions or
requirements for changes in rates that may have been imposed by the
Commission's suspension order. AGD recommends that, in situations where
the Commission has required changes in the filed rates, a minimum
period of 14 days be fixed as the time between the filing of a motion
to place rates in effect and the proposed effective date. AGD also
recommends that the provision recommended in its Initial Comments be
added to Section 154.206(a). \27\
\27\ That proviso states:
Provided, however, that no rates will be made effective pursuant
to motion until after the party proposing a rate change has
satisfied all conditions imposed by the Commission with regard to
the contents of the rate increase filing.
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AGD points out that the preamble to the Rule states that
``individual suspension orders may require pipelines to make compliance
filings earlier, to reflect changes required by the Commission.'' \28\
However, AGD states that this language is not a satisfactory answer to
the problem because the regulations governing the time of motions
placing rates in effect provides only 24 hours within which the
pipeline's compliance with the Commission's required changes in its
rate filing can be determined. AGD states that there is no assurance
that, in individual cases, sufficient time will be provided to
ascertain that the pipeline's compliance with Commission-mandated
changes in its rates has occurred. AGD states that there is no
regulatory bar to the pipeline's ability to place in effect, after the
suspension period, rates which do not comply with the changes mandated
by the Commission's suspension order.
\28\ III FERC Stats. & Regs. para. 31,025 at 31,400.
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ii. Commission response. The NOPR had proposed that when rates have
been suspended for more than a minimal period and the Commission has
ordered changes or the rates include costs of facilities that are not
in service, the motion to place suspended tariff sheets into effect
must be filed no less than 30 days nor more than 60 days prior to the
date the sheets would take effect. AGD's Initial Comments had proposed
that in addition to the 30-60 day opportunity to ascertain whether
pipeline compliance with any Commission-ordered changes in its rates
had occurred, that the regulations also include a provision which
negated the pipeline's ability to place into effect any suspended rates
which did not reflect changes the Commission had ordered. Columbia
commented that the proposed requirement would cause pipelines to
estimate test period data for that portion of the test period occurring
after the date the pipeline must make the motion rate filing.
CNG and Columbia recommended no change to the practice of allowing
pipelines to file motion rates one day before the effective date. CNG
commented that the proposed rule would require pipelines to rely on
estimated plant balances in determining the level of plant in service
at the end of the test period. Further, CNG stated, the pipeline would
be unable to determine the status of negotiations 30 days in the
future, and would be compelled to move to make the rate increase
effective at the earliest possible date. In light of these comments to
the NOPR, the revised regulation was modified to continue the current
practice of allowing pipelines to file motion rates one day before the
effective date.
The modifications requested by AGD are denied. AGD is incorrect in
stating the there is no ``regulatory bar'' to the pipeline's ability to
place in effect, after the suspension period, rates which do not comply
with the changes mandated by the Commission's suspension order.
Pursuant to Sec. 154.206, the motion must be accompanied by revised
tariff sheets reflecting any changes ordered by the Commission. A
motion that does not reflect the ordered changes would be in violation
of the Commission order and the subject rates would be unlawful.
2. Withdrawal After Minimal Suspension
Section 154.206(c) provides that where the rate is suspended for a
minimal period and the pipeline has included in its transmittal letter
pursuant to Sec. 154.7(a)(9), a motion to place the proposed rate into
effect at the end of the suspension period, the change will go into
effect, subject to refund, on the authorized effective date.
ANR and CIG seek clarification that if the pipeline includes a
motion with the transmittal letter, and the Commission accepts the
filing but requires changes to the pipeline's proposal, the pipeline
will still have the option of withdrawing its motion before the rates,
with the Commission modifications, go into effect.
This clarification is denied. As discussed above, the pipeline may
choose to reserve its right to file a later motion and rates, suspended
for a minimal period, will go into effect, later, on motion of the
pipeline. Where the pipeline chooses to include a motion in its filing
and the proposed rates are suspended for a minimal period, the rates
will become effective on the date proposed. However, the pipeline may
condition its motion on the Commission's accepting the proposed filing
without modification.
i. Section 154.208 Service on Customers and Other Parties. New
Sec. 154.208 formally requires the filing company to serve its
customers and state regulatory commissions on or before the filing
date. The regulation requires that all customers and state commissions
receive an abbreviated form of the filing.\29\ Customers and state
[[Page 9619]]
commissions with an interest may then request a full copy. The pipeline
must serve the full copy within 48 hours. However, pipelines must
comply with any customer's standing request to receive a complete
filing as the initial served filing. Customers are defined as customers
of the pipeline with a contract for service as of the date of the rate
case filing.\30\
\29\ Section 154.208 Service on customers and other parties.
(a) On or before the filing date, the company must serve, upon
all customers as of the date of the filing and all affected state
regulatory commissions, an abbreviated form of the filing consisting
of: the Letter of Transmittal; the Statement of Nature, Reason, and
Basis; the changed tariff sheets; a summary of the cost-of-service
and rate base; and, summary of the magnitude of the change.
(b) On or before the filing date, the company must serve a full
copy of the filing upon all customers and state regulatory
commissions that have made a standing request for such service.
(c) Within 48 hours of receiving a request for a complete copy
from any customer or state commission that has not made a standing
request, the company must serve a full copy of any filing.
\30\ III FERC Stats. & Regs. para. 31,025 at 31,403.
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2. Service Group
NGSA asks the Commission to include ``economically impacted
parties'' as part of Sec. 154.208. NGSA states that some gas producers
effect title transfer of their gas either at the wellhead or at the
outlet of a non-jurisdictional gas gathering system. NGSA states that
because gas producer prices and wellhead operations are affected by the
rates, terms and conditions of the pipeline's tariff, they should enjoy
the full rights of any other potential intervenor to a rate case,
including the expeditious receipt of the pipeline's rate case
documents. NGSA states that ``economically impacted parties'' includes
those purchasers of short-term released capacity who may not have ``a
contract for service as of the date of the rate case filing.'' NGSA
states that economically impacted parties should not be excluded from
receiving the pipeline's rate case filing or because the timing of the
rate case does not coincide with the timeframe specified within a
contract.
America Forest and Paper Associates (AF&PA) requests that on
rehearing the Commission revise Sec. 154.208 to provide that, in
addition to customers and affected state commissions, the pipelines
must serve tariff filings on interested parties, such as trade
associations and customer groups, and their representatives. AF&PA
argues that trade associations and customer groups play an important
role in proceedings before the Commission and enable the Commission to
conduct an efficient decision-making process by allowing it to consider
the views of many interested parties channeled through one source.
On the other hand, Columbia states that the requirement to serve
even the abbreviated copy upon all customers is unduly burdensome. To
illustrate, Columbia states that, Columbia Transmission, in addition to
its firm customers, presently serves 300 interruptible transportation
customers, and Columbia Gulf serves 200 interruptible customers.
Columbia continues to believe that the Rule should be modified to
require service only upon firm customers and affected state commissions
on the filing date. Columbia states that service effected in this
manner, along with the form of notice pursuant to Sec. 154.209, is
sufficient to assure adequate notice.
The requests for rehearing are denied. In light of the responses to
the NOPR, the revised regulation is a combination of the alternatives
suggested by several commenters and represents a reasonable middle
ground between requiring service of a complete filing and service of
just the transmittal letter. While reducing the filing burden to the
pipeline, this course assures that all current customers and state
regulatory commissions receive complete notice adequate to making
informed decisions about the proposal. Adding or deleting recipients to
the required service list would upset the balance achieved by the
regulation.
3. ``Served'' or ``Received''
NGSA requests that the Commission clarify or modify Sec. 154.208(c)
so that pipelines are required to send the full rate case filing to a
requestor such that it is received within 48 hours of their request.
APGA and NGSA state that Sec. 154.208(c) permits the pipelines to
engage regular U.S. postal services 48 hours after the request had been
made and receive the full filing two or three days after it is
postmarked. APGA and NGSA believe that the existence of overnight
express delivery services makes it possible for parties to receive a
full filing within 48 hours of their request.
The request for rehearing is denied. Rule 2010 governing the timing
of service states that service is made when the document is deposited
in the mail or delivered in another manner.\31\ The increased burden of
requiring pipelines to ensure delivery within 48 hours is out of
balance to the potential benefit to parties receiving the documents
earlier. However, while not required, parties may agree to arrange for
overnight delivery. It would be reasonable to expect the recipient to
bear the cost of this additional service.
\31\ 18 CFR 385.2010.
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4. Service Recipient
APGA states that it is the customer's representative or agent,
i.e., attorney or consultant, who has the most urgent need to review a
complete copy of the filing in order to have time to prepare a motion
to intervene, protest or comments within the deadline provided by the
Rule for the filing of such pleadings. APGA requests that the
Commission clarify that a customer may designate a representative or
agent also to receive service of a complete copy of a rate filing on or
before the filing date. In the alternative, APGA requests rehearing of
this issue.
The request is granted in part. In past practice, a party could
designate a recipient at the time it files an intervention or when the
service list is created at hearing. Now that the filing company must
serve its customers on or before the filing date, there must be a
procedure for designating service recipients at the earlier time. The
regulation will be revised to provide that a customer may designate a
representative or agent to receive service on or before the filing date
as suggested by APGA. The filing company is required to serve only one
copy per customer, not multiple copies. However, while not required,
parties may agree to arrange for multiple recipients or copies. It
would be reasonable to expect the recipient to bear the cost of this
additional service.
5. 48 Hours
Columbia Gas Transmission Corporation and Columbia Gulf
Transmission Company (Columbia) and INGAA request clarification that
the parties may interpret Sec. 154.208(c), requiring action within 48
hours, to mean two business days, thereby removing the concern that
responsive action need not be taken on holidays or weekends.
Columbia's concern is unnecessary. Rule 2007 provides that ``any
period of time'' prescribed by a Commission rule is computed to exclude
the day of the act or event from which the time period begins. Further,
the last day of the time period is not included if it is a weekend or
holiday, in which case the period ends at the close of business on the
next day that is not a weekend or holiday.\32\ Nonetheless, to avoid
any confusion the regulations will be revised to state that the
pipeline must respond to such requests within two business days.
\32\ 18 CFR 385.2007(a).
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6. Electronic Version
NGC argues that the Commission erred by failing to require
interstate pipelines to provide shippers with an electronic version of
their filing. NGC states that the provision does not require pipelines
to honor a customer's request to receive a copy of the filing in
electronic format.
NGC states that rather than forcing customers to wait until the
tariff data is entered into the Commission's FASTR system, which can
take weeks, customers should have instant access to the full filing,
through the acquisition of
[[Page 9620]]
the data in a standardized electronic format directly from the
applicant. NGC states that since the pipelines are already required to
file electronically, there will be little added burden or cost to
making electronic versions of their filings available.
Under Secs. 154.4 and 154.209 of the regulations, pipelines must
file the form of notice, tariff sheets, and statements and workpapers
required by subpart D of the regulations electronically. In Order No.
582, the Commission recognized that both the electronic and paper
versions of the filing represent the official filing.\33\ Parties
receiving service under Sec. 154.208 have a right to receive all or
part of the official filing depending on their election. Since the
electronic portion of the filing is part of the official filing,
service would include the pertinent parts of the electronic version of
the filing. However, in recognition that not all parties would be
interested in receiving the electronic portion of the filing, a party
may ask not to receive the electronic portion of the filing, if that is
its wish.
\33\ III FERC Stats. and Regs., para. 31,025 at 31,437.
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j. Section 154.210 Protests, Interventions, and Comments
Section 154.210 states that interventions, comments, and protests
must be filed within 12 calendar days of the filing date and comments
must be filed at the same time as interventions and protests.\34\
\34\ Section 154.210 Protests, interventions, and comments
(a) Unless the notice issued by the Commission provides
otherwise, any protest, intervention or comment to a tariff filing
made pursuant to this part must be filed in accordance with
Sec. 385.211 of this chapter, not later than 12 days after the
subject tariff filing. A protest must state the basis for the
objection. A protest will be considered by the Commission in
determining the appropriate action to be taken, but will not serve
to make the protestant a party to the proceeding. A person wishing
to become a party to the proceeding must file a motion to intervene.
(b) Any motion to intervene must be filed not later than 12 days
after the subject tariff filing in accordance with Sec. 385.214 of
this chapter.
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APGA seeks rehearing on this issue and reiterates its request that
parties be allowed a minimum of 15 days to file interventions.
The NOPR had proposed that the interventions, comments, and
protests be filed within ``10 days'' of the filing. Many commenters
objected to changing from the ``former 15-day'' time period and
numerous alternatives were suggested for comment periods ranging from
10 to 30 days. The Commission has balanced the need to allow sufficient
time for interested parties to review a filing with the need for the
proceeding to progress swiftly. The use of the 12 calendar day standard
achieves this balance. The request for rehearing is denied.
k. Section 154.301 Changes in Rates
PEC Pipelines request clarification as to what items are considered
``rate fixing adjustments'' and which are not.\35\ PEC Pipelines
requests clarification that cost-of-service items, contract demand
levels, and throughput are not ``rate fixing adjustments,'' for
purposes of this requirement. PEC Pipelines state that the mere fact
that an element of cost-of-service--such as labor costs--has increased
is not the type of ``rate fixing adjustment'' that should trigger an
additional workpaper requirement. PEC Pipelines state that the same is
true with respect to contract demand levels and throughput. PEC
Pipelines state that the level of O&M expenses and throughput are
already covered by the schedules set forth under Sec. 154.312,
Composition of Statements. On the other hand, PEC Pipelines state,
certain items do affect the setting of the unit rate, such as cost
allocation and rate design; logically, these items are those that
should be considered ``rate fixing adjustments'' as addressed in
Sec. 154.301(c).
\35\ Section 154.301 (c) provides:
A natural gas company filing for a change in rates or charges
must be prepared to go forward at a hearing and sustain, solely on
the material submitted with its filing, the burden of proving that
the proposed changes are just and reasonable. The filing and
supporting workpapers must be of such composition, scope, and format
as to comprise the company's complete case-in-chief in the event
that the change is suspended and the matter is set for hearing. If
the rate fixing adjustments presented are not in full accord with
any prior Commission decision directly involving the filing company,
the company must include in its working papers alternate material
reflecting the effect of such prior decision. (For purposes of this
section, rate of return is not a rate fixing adjustment.)
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In response to PEC Pipelines' concern the Commission will revise
this section by substituting the term ``change in rates or charges''
for ``rate fixing adjustments.'' This change is more in line with the
current terminology where parties no longer refer to ``fixing'' a rate
but ``making'' a rate change. The Commission agrees with PEC Pipelines
that the mere fact that an element of the cost-of-service has increased
does not trigger an additional workpaper requirement. Pipelines need to
file alternate material when they are proposing a ratemaking change
that is inconsistent with a prior Commission decision directly
involving the filing company. Further, as the Commission does not
require that a specific rate of return must be used in subsequent
filings, the parenthetical language is removed because it is not
necessary and may cause confusion.
l. Section 154.303 Test Periods.
Although Sec. 154.303 is a complete redraft of former
Sec. 154.63(e)(2) (i) and (ii), the revised regulation maintains the
same time scheme for the test period.36 The test period consists
of a base period followed by an adjustment period. The base period
consists of 12 consecutive months of the most recently available actual
experience. The last day of the base period may not be more than four
months prior to the filing date. The adjustment period is a period of
up to nine months immediately following the base period.
\36\ Section 154.303 Test periods.
Statements A through M, O, P, and supporting schedules, in
Sec. 154.312 and Sec. 154.313, must be based upon a test period.
(a) If the natural gas company has been in operation for 12
months on the filing date, then the test period consists of a base
period followed by an adjustment period.
(1) The base period consists of 12 consecutive months of the
most recently available actual experience. The last day of the base
period may not be more than 4 months prior to the filing date.
(2) The adjustment period is a period of up to 9 months
immediately following the base period.
(3) The test period may not extend more than 9 months beyond the
filing date.
(4) The rate factors (volumes, costs, and billing determinants)
established during the base period may be adjusted for changes in
revenues and costs which are known and measurable with reasonable
accuracy at the time of the filing and which will become effective
within the adjustment period. The base period factors must be
adjusted to eliminate nonrecurring items. The company may adjust its
base period factors to normalize items eliminated as nonrecurring.
(b) If the natural gas company has not been in operation for 12
months on the filing date, then the test period must consist of 12
consecutive months ending not more than one year after the filing
date. Rate factors may be adjusted as in paragraph (a)(4) of this
section but must not be adjusted for occurrences anticipated after
the 12-month period.
(c)(1) Adjustments to base period experience, or to estimates
where 12 months' experience is not available, may include the costs
for facilities for which either a permanent or temporary certificate
has been granted, provided such facilities will be in service within
the test period; or a certificate application is pending. The filing
must identify facilities, related costs and the docket number of
each such outstanding certificate. Subject to paragraph (c)(2) of
this section, adjustments to base period experience, or to estimates
where 12 months' experience is not available, may include any
amounts for facilities that require a certificate of public
convenience and necessity, where a certificate has not been issued
by the filing date but is expected to be issued before the end of
the test period. Adjustments to base period may include costs for
facilities that do not require a certificate and are in service by
the end of the test period.
(2) When a pipeline files a motion to place the rates into
effect, the filing must be revised to exclude the costs associated
with any facilities not in service as of the earlier of the
effective date or the end of the test period.
(d) The Commission may allow reasonable deviation from the
prescribed test period.
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Section 154.303 clarifies that the pipeline must remove from rates
moved
[[Page 9621]]
into effect the cost of any facilities not certificated (where a
certificate is required) and in service as of the end of the test
period.
1. Base Period
MRT and Williston Basin request that the Commission grant rehearing
and amend Sec. 154.303(a)(1) to lengthen the time from the last day of
the base period to the filing date from four months to five months. MRT
states that no pipeline would need to wait the full five months to
file, but for pipelines with small staffs, like MRT, an additional
month would greatly facilitate the timely filing of a high-quality
initial filing and Statement P. Williston Basin argues that no
justification has been given in Order No. 582 for reducing the already
limited amount of time which a pipeline has to prepare its rate
filings.
These requests, in effect, seek to set the test period back one
month. This the Commission is reluctant to do. The regulations are
constructed so that the rate paid by a customer is based upon
representative costs recently incurred by the pipeline for providing
the services to that customer. The regulations continue to set the
cutoff date for these representative costs at four months before the
filing. MRT and Williston Basin have not shown that this period is
unreasonable.
2. Costs of Facilities for Which a Certificate Application is Pending
i. Requests for rehearing. Williston Basin seeks rehearing of the
requirements of Sec. 154.303(c). Section 154.303(c)(1) permits a
pipeline to include, in adjustments to the base period, costs of
facilities for which a certificate application is pending. Section
154.303(c)(2) requires that when a pipeline files a motion to place the
proposed rates into effect, the tariff filing must be revised to
exclude the costs associated with any facilities not in service as of
the earlier of the effective date or the end of the test period.
Williston Basin states that there is a problem where a pipeline
files its motion to put its proposed rates into effect before the end
of the adjustment period. In those circumstances, Williston Basin
argues, the pipeline should be permitted to include the cost of the
facilities estimated to be in service at the end of the adjustment
period, subject to true-up when the actual costs are known.
Williston Basin states that if the Commission suspends the proposed
rates for one day but the adjustment period does not end for another
five months, the pipeline would not be able to include the costs of
facilities under construction for any of that five-month period even if
the facilities are in service by the end of the adjustment period.
Likewise, Williston Basin states, if the rates are suspended until the
end of the adjustment period, the pipeline's motion filing would still
be made before the end of the adjustment period and the exact costs of
the facilities would not be known on the day the motion is made.
PEC states that the Commission should clarify that it did not
intend to depart from past practice in promulgating Sec. 154.303 and
except from its Sec. 154.303(c)(2) requirement costs associated with
routine facility construction. PEC states that the clarified regulation
would read as follows:
When a pipeline files a motion to place rates into effect, the
filing must be revised to exclude the costs associated with any
facilities for which specific certificate authorization is required
but is not expected to be granted or not in service by the end of
the test period.
PEC states that the Commission should also clarify that costs
through the end of the test period (not the earlier of the effective
date or the end of the test period as stated in Order No. 582) may be
included in rates. PEC states that if the Commission does not so
clarify its regulations, the end of test period analysis will be skewed
because not all of the costs of facilities at the end of the test
period will be included, leading to mismatches in elements of cost of
service. PEC argues that costs applicable to new facilities could be
excluded on grounds that the facilities were not in service on an
effective date occurring earlier than the end of the test period, even
though volumes applicable to transportation through the facilities
would be reflected in rates if the deliveries commenced prior to the
end of the test period. PEC states that the basic objective of
synchronizing all rate elements at the end of the test period will be
thwarted. PEC states that the proposed revised Sec. 154.303(c)(2) would
correct this inconsistency.
ii. Commission response. These requests are granted. The regulation
will be revised to return to the previous practice. Typically, at the
end of the suspension period, the pipeline files a motion to place the
proposed rates, as adjusted for any Commission determinations, into
effect. The requirement that the motion rates not include costs through
the end of the test period, when the effective date is earlier, negates
the ability, otherwise provided by the regulations, to adjust for
changes in revenues and costs which are known and measurable with
reasonable accuracy at the time of the filing and which will become
effective within the adjustment period. Accordingly, the regulation
will be changed to allow a pipeline to file a motion to place rates
into effect that include costs associated with facilities not in
service as of the effective date subject to removal of such costs where
the facilities are not in service by the end of the test period.
m. Section 154.304 Format of Statements, Schedules, Workpapers, and
Supporting Data
Section 154.304 requires a narrative explanation of each proposed
adjustment to base period actual volumes and costs.37 The Rule
indicated the Commission's intention to adopt two of NGSA's
suggestions; 38 however, these changes did not appear in the
regulatory text. The Commission is amending Secs. 154.304 and 154.311
to reflect NGSA's suggestions that narrative explanations be placed at
the beginning of the specific statements to which they apply and that
statement updates be provided to parties specifically requesting them.
\37\ Section 154.304(b) provides:
The data in support of the proposed rate change must include the
required particulars of book data, adjustments, and other
computations and information on which the company relies, including
a detailed narrative explanation of each proposed adjustment to base
period actual volumes and costs.
\38\ III FERC Stats. & Regs. para. 31,025 at 31,405.
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n. Section 154.305 Tax Normalization
Section 154.305 requires pipelines to use tax normalization to
compute the income tax component of the cost-of-service and to adjust
rate base by accumulated deferred income taxes related to components of
the cost-of-service.
On rehearing, APGA requests that the Commission promulgate
amendments to its regulations to curtail the practice whereby pipelines
eliminate or reduce their accumulated deferred income tax (ADIT)
account balance, which is typically deducted from rate base, and
correspondingly increase their rate base and hence their return, when a
pipeline undergoes a merger.
The request for rehearing is denied. Because the request concerns a
ratemaking policy, it is beyond the scope of this rulemaking.
o. Section 154.311 Updating of Statements
Certain Statements and Schedules must be updated, once, 45 days
after the end of the test period.
[[Page 9622]]
INGAA requests clarification that the Commission did not intend
nine 12-month running totals but rather intended a monthly total for
each month in the nine-month period with a single set of updates
encompassing a 12-month period. Second, INGAA states that the 45-day
update requirement is insufficient time for this much data to be
assembled since the books will not close until at least 10-15 days past
the end of the test period. INGAA requests clarification that a period
of 75 days be given for such updates. Third, INGAA urges the Commission
to authorize the Director of OPR and presiding ALJ to suspend or
terminate the update requirements if a settlement is pending approval,
hearings have been completed, or an ALJ's decision is pending. INGAA
states that updates in these situations would serve no purpose.
The Commission did not intend that updates would have nine
different 12-month running totals for each month since updates would be
filed 45 days after the end of the test period. Also, updates must
include a monthly total for each month in the nine-month period with a
single set of updates encompassing a 12-month period. INGAA's request
for clarification on this issue is granted.
INGAA's suggestion of 75 days in lieu of 45 days will not be
adopted. The Commission staff works expeditiously to complete the
review of a pipeline's rate filing and prepare the preliminary staff
position, testimony and exhibits. Companies have access to the data for
updates within 10 to 15 days of closing and thus could file within the
45 day period seemingly without undue hardship. Thus, adding 30
additional days to the process would merely delay the case without a
corresponding benefit.
We agree with INGAA's reasoning on the suspension of updates. The
Secretary has the authority to grant extensions of time. The
regulations will be revised to recognize the Secretary's authority to
extend the time for the updates.
The Rule states that among the statements and schedules to be
updated are H-1(3)(a) through H-1(3)(1). Williston Basin seeks
clarification that the reference is to H-1(2)(a) through H-1(2)(k).
Williston Basin is correct. The reference is being changed to H-1(2)(a)
through H-1(2)(k).
p. Section 154.312 Composition of Statements
1. Schedule D-1
The PEC Pipeline Group suggests that the filings would be more
comprehensible and consistent if Sec. 154.312, Schedule D-1, were
amended to include the functionalization of the as adjusted test period
accumulated reserve for depreciation and amortization. PEC Pipeline
Group also suggests a new Schedule D-3 showing the depreciation reserve
balance applicable to the portion of the depreciation rate not yet
approved. PEC Pipeline Group also suggests that Schedule D-1 should not
be part of the workpapers.
Schedule D-1 will be amended to include the functionalization of
the as adjusted test period accumulated reserve for depreciation and
amortization. However, a new Schedule D-3 is not necessary since the
information required to reflect the depreciation reserve balance
applicable to the depreciation rate not yet approved can be shown on
the same schedule. Schedule D-1 is properly a workpaper since it
reflects supporting data for Statement D.
2. Statement G, Revenues, Credits, and Billing Determinants
Statement G is a summary of information on all jurisdictional
services. Statement G must be filed with the rate case. More specific
information, in Schedules G-1 through 6, must be filed 15 days later.
i. Delayed filing of schedules. APGA states that, now that the
Commission under Order No. 636 has relieved pipelines of mandatory
triennial rate filings, the pipeline is generally in complete control
of the date on which it makes a rate filing, and there is no reason to
conclude that it is burdensome to file the information required in
Schedule G-1 through G-6 at the same time as the rate filing. APGA
states that most of the information required to be filed in those
schedules should be easily accessible by the pipeline directly from its
computer database, with little or no analysis required.
APGA states that by permitting certain information to be filed
after the filing date, the Commission is taking away with one hand what
it has given customers with the other in requiring that a pipeline's
Statement P testimony be filed concurrently with the rate case. In
light of the Commission's requirement that this customer-specific
information need only be served upon affected customers and those
customers requesting service, APGA argues that the Commission should
grant rehearing and require the information submitted under Schedules
G-1 through G-6 to be filed concurrently with a pipeline's rate filing.
APGA's request for rehearing is denied. The Commission has required
a summary Statement G to provide enough information to begin the
analysis of the rate case. However, the customer specific information
is not required immediately; and, is filed 15 days later to ease the
burden of the compilation of such large scale information on the filing
pipeline.
ii. Confidentiality. ANR and CIG join INGAA in urging the
Commission to reconsider and incorporate the confidentiality provisions
of the INGAA/AGD agreement in a final rule on rehearing.39 In the
alternative, ANR and CIG request that the Commission permit pipelines
to have the option, in all instances where customer specific
information is called for (for example, in the schedules required in
Statement G, the Index of Customers and Form 2 Revenues and Discounts),
of using customer codes to identify customers.
\39\ Specifically, the Agreement recommends that the Commission
allow pipelines to serve Schedules G(1) and G(2) to requesting
parties under a protective agreement document reached through
negotiation between the pipeline and intervenors in the rate case.
In the event that parties could not agree to such a document prior
to filing, the pipeline would use the protective agreement employed
for similar purposes in the pipeline's most recent rate case.
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The PEC Pipeline Group disagrees with the Commission's position
regarding pipelines' market power in today's market and regulatory
environment. The PEC Pipeline Group states that pipelines compete with
one another and with customers using capacity on pipeline systems in
new and innovative ways under the auspices of Order No. 636; and, non-
pipeline entities use capacity release and the ``gray'' market to
compete with pipelines. PEC Pipeline Group states that the customers
have a stake in avoiding public disclosure of the information because
competitors of a customer will know what the pipeline expects to charge
that customer over a future period of time, not just historically. PEC
Pipeline Group requests clarification that coding and the projection of
commodity billing determinants by rate schedule are appropriate to use
in preparing Statement G and the related schedules. Alternatively, the
PEC Pipeline Group requests clarification that the Commission
recognizes the potential harmful effects on competition that public
disclosure of test period information has and will thus entertain
[[Page 9623]]
with favor, taking into account potential anticompetitive effects,
requests for confidential treatment on a broad basis.
These requests are denied for the reasons discussed, at length, in
the Rule.40 The type of information for which PEC Pipeline seeks
confidential treatment is the type of information that section 4(c) of
the NGA requires pipelines to make publicly available.41 If
confidentiality is sought as to test period information, Sec. 388.112
sets out the procedure to be followed.
\40\ III FERC Stats. & Regs. para. 31,025 at 31,412-3.
\41\ For a full discussion on this issue, see ANR Pipeline
Company, 65 FERC para. 61,280 at 62,304-7 (1993).
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iii. Capacity Release. Statement G requires that the pipeline
provide: (1) Total revenues by rate schedule and by receipt and
delivery rate zones, if applicable; and (2) billing determinants
(demand and commodity) by rate schedule and by receipt and delivery
rate zones, if applicable. Schedule G-3 also requires that the pipeline
specify, quantify and justify each proposed adjustment including
capacity release.
ANR and CIG seek clarification that the requirements of Statement
G, relative to capacity release, requires only summary level total
revenue and billing determinants by receipt and delivery rate zones, if
applicable, and does not require such information for each capacity
release transaction. In the alternative, ANR and CIG seek rehearing if
Statement G would require data for each capacity release transaction.
ANR and CIG state that, since most capacity release transactions are
for a term of a month or less, requiring detail for each capacity
release transaction would be unduly burdensome, for example: based upon
current experience, ANR would have about 1000 capacity release
contracts for the base period; CIG would have approximately 400
capacity release contracts for the base period. ANR and CIG state that
if revenue and billing determinants of releasing shippers are not
reduced for capacity release, then capacity release data is needed only
for the design of usage rates. In such instances, ANR and CIG state
capacity release data need only be provided by receipt and delivery
rate zone, if applicable.
ANR and CIG are correct. The Commission clarifies that Statement G,
relative to capacity release, requires only summary level total revenue
and billing determinants by receipt and delivery rate zones by
releasing shipper. It does not require such information for each
capacity release transaction.
3. Schedule G-2
Schedule G-2 shows revenue and billing determinants by month, by
customer name, by rate schedule, by receipt and delivery zone, if
applicable, by major rate component and totals for the adjustment
period. Great Lakes agrees that this requirement may be appropriate to
the extent that a customer's adjusted throughput varies by month/
season. However, Great Lakes states, in the absence of such a
variation, the monthly breakdown of adjustment period throughput does
not serve any useful purpose and creates unnecessary paperwork. Great
Lakes requests clarification that no monthly breakdown is required if
the pipeline provides a written statement that its projected annual
throughput is evenly distributed over each month of the adjustment
period.
The request for rehearing is denied. There is no need to make a
generic change in the Rule. However, a pipeline demonstrating that its
projected annual throughput is evenly distributed by months, may ask
for a waiver of the monthly filing requirements.
4. Schedules G-5 and I-4
Revenues from the release by the pipeline of transportation and
compression capacity it holds on other pipelines (Account 858 capacity)
must be reflected as a credit to Account 858 in Schedule I-4 and also
as revenue in Schedule G-5 (Other Revenues).
INGAA seeks clarification that revenues from capacity release are
not double counted. INGAA states that, while inclusion of such revenues
as a credit against Account 858 costs is appropriate, Schedule I-4 in
Section 154.312(o)(4)(v) requires that revenues from released capacity
be reflected, separately, in Schedule G-5. INGAA states that under this
methodology, revenues from released capacity would count twice against
cost of service; once as a credit towards Account 858 costs and second
as other revenue. INGAA requests that the requirement to include these
amounts in Statement G-5 be removed.
The Commission agrees that these revenues should not be double
counted. However, the revenues must be shown in both Schedules I-4 and
G-5. If the revenues are credited to the cost of service in Schedule G-
5, then these revenues shown in Account 858 may be removed from the
total costs claimed on Schedule I-4. However, if they are not reflected
as a credit to the cost of service through Schedule G-5, then they must
be counted as a credit in Schedule I-4 and Account 858.
5. Schedule H-1(1)
Schedule H-1 requires identification and explanation of all accrual
or other normalizing accounting entries reflected in the applicant's
base period expenses.
In response to a comment, the Commission revised proposed Schedule
H-1(1) to require the disclosure and explanation of all accruals, not
just special accruals reflected in the monthly per book expenses in
order to allow customers to test whether a pipeline is inflating its
expenses in order to increase its rates.42
\42\ III FERC Stats. & Regs. para. 31,025 at 31,417.
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i. Explanation of all accruals. A. Requests for rehearing. Great
Lakes argues that this section should not require the explanation of
all accruals. Great Lakes argues that numerous accruals are necessarily
recorded for items such as payroll, insurance, taxes, etc. Great Lakes
states that separately identifying and explaining all base period
accruals would be very time consuming and burdensome; and that,
disclosure of meaningful data can be accomplished much more efficiently
by adhering to the requirements set forth in both the Commission's
previous regulations and the NOPR. Great Lakes states that adherence to
this requirement, in addition to the Commission staff's audit and data
request procedure, is more than sufficient to meet the commenter's
concerns without requiring the burdensome production of data, the
usefulness of which is questionable at best. PEC argues that there is
no evidence that routine true-ups cause special ratemaking concerns and
the original language should be reinstated.
ANR and CIG also seek rehearing on these grounds and add that a
rate case filing is not the proper forum for the disclosure and
explanation of all accruals because such evaluation is currently
performed by the Commission's Office of Chief Accountant (OCA) Staff
and a company's external accounting firm. ANR and CIG also seek
clarification or rehearing concerning whether the new rule requires a
pipeline to explain the accruals appearing in every month in the base
period. Since most of the individual monthly accruals will have been
paid during the base or test period, and therefore there should be no
question regarding inflation of such expenses, the only explanation of
accruals that would be of value to any extent would be those that are
recorded at the end of the test period. Thus, ANG and CIG state, to the
extent that the rule requires an explanation of accruals, the
[[Page 9624]]
explanation should only be with respect to accruals remaining on the
books at the end of the test period.
Williston Basin seeks rehearing of the requirement that certain
expenses be stated on a cash basis. Schedule H-1(1) requires that
pipelines reconcile their base period expenses to actual case
expenditures. Williston Basin states that this imposes an enormous
burden on pipelines as it conflicts with the method by which pipelines
maintain their accounts under the Uniform System of Accounts.43
Williston Basin states that recording these types of items on a cash
basis would violate the Uniform System of Accounts and require
companies to maintain two sets of accounting records: one which
complies with the Uniform System of Accounts and one from which the H
Schedules can be prepared. Williston Basin states that instead of
adopting Schedule H-1(1) as written in Order No. 582, the Commission
should adopt Schedule H-1(1) as written in the NOPR, whereby only
``special accruals'' would be reconciled rather than ``all accruals.''
\43\ According to the Uniform System of Accounts: ``The utility
is required to keep its accounts on the accrual basis. This requires
the inclusion in its accounts of all known transactions of
appreciable amount which affect the accounts.'' 18 CFR Part 201,
General Instruction No. 11. Under accrual accounting, assets and
liabilities are recognized as they occur--not when they are paid.
For example, the expense and liability for payroll taxes are
recorded at the time the associated payroll is recorded, not when
the taxes are paid. Similarly, the expense and liability for receipt
of purchased materials is recorded when the materials are received.
It is at the time of that the obligation to the vendor is
established. Other examples of where the liability accrued precedes
the actual cash payment include interest expense, income taxes,
prepaid insurance, pension costs, post retirement benefit costs, and
use taxes.
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B. Commission response. These requests for rehearing are granted.
Under accrual accounting, many expenses are accrued one month and paid
the next. With thousands of accrued entries on the books of most
pipelines, the additional disclosure requirements included in Schedule
H-1(1) regulations would be extremely lengthy, burdensome and, except
for project development expenses, unnecessary. In addition, many of the
accruals would have been paid during the base period, and thus present
no danger of expense inflation. The only explanation of accruals that
might be of value would be that of expenses recorded at the end of the
base period. Accordingly, Schedule H-1(1) will be modified such that
only ``special accruals'' are reconciled.
ii. Project development costs. INGAA seeks clarification that
Schedule H-1(1) regulations apply only to project development costs, as
the Commission indicated in the preamble, and that these regulations
should apply only to accruals remaining on the books at the end of the
base period. This clarification is granted and Schedule H-1(1) is
amended accordingly.
6. Schedule H-1(1)(c)
Schedule H-1(1)(c) requires a pipeline to show expenses and
associated quantities applicable to Accounts 810, 811 and 812.
Williston Basin seeks rehearing of this requirement. Williston Basin
states that the cost portion of this schedule should be eliminated
because fuel costs are recovered by a separate mechanism under
Williston Basin's existing tariff and such costs should, therefore, not
be subject to review here. Alternatively, Williston Basin states that
if a pipeline's fuel reimbursement tracker does not require a
redetermination of the base level of gas in a rate proceeding, the
Commission should not require that the pipeline provide this
information.
Williston Basin's request for rehearing is denied. As noted in the
Rule, the Commission must review all fuel costs, whether recovered in a
separate mechanism or not.44 Fuel usage is an important element of
a pipeline's costs and though these costs may be tracked, a pipeline's
tracker may require a redetermination of the base level in a rate
proceeding. Since both volumes and costs are recorded in the fuel
accounts the data are readily available.
\44\ III FERC Stats. & Regs. para. 31,025 at 31,417.
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7. Schedules H-1(2)(j)(iv)
Schedule H-1(2)(j)(iv) requires that a pipeline document the
derivation of the allocations used to appropriate costs among
affiliated companies. The pipeline must also identify by account number
all costs paid to or received from affiliated companies which are
included in a pipeline's cost of service for both the base and test
periods.
INGAA requests that Schedule H-1 be amended such that documentation
demonstrating the derivation of allocation bases with underlying
calculations are to be provided, as they are today, during discovery.
INGAA states that requiring all pipelines to provide this information
with the original rate case filing is unduly burdensome because there
are numerous types of costs allocated between divisions or companies,
each with its own ``allocation basis and underlying calculations.''
INGAA states that in addition to reducing the burden on pipelines,
providing the information during discovery would allow the data to be
tailored better to the needs of intervenors and the nature of the
pipeline.
Rehearing is granted. The Commission agrees with INGAA that
providing this type of information with the initial filing is not
generally necessary. Schedule H-1(2)(j)(iv) will be amended by removing
the requirement to provide documentation of the derivation of
allocation bases.
8. Schedule I-1, Functionalization of Cost-of-Service
Schedule I-1 replaces current Statement I (Allocation of overall
cost-of-service). The information on jurisdictional and
nonjurisdictional sales allocation is eliminated as no longer needed.
Schedule I-1 (c) requires a pipeline that maintains its records by
zones and proposes a zone rate methodology to provide functionalized
costs for each zone. NGSA suggests that Schedule I-1 (c) should only be
required for pipelines which separate their cost-of-service by zones.
This is already the case. Section 154.310 requires a cost-of-service by
zone only if a pipeline maintains records of costs by zones and
proposes a zone rate methodology based on these costs. (See the
discussion of Sec. 154.310.)
9. Schedule I-1 (d)
NGSA states that on Schedule I-1 (d), pipelines should be required
to show the basis for allocating all costs (A&G, working capital) among
functions. NGSA states that the experience of its member companies is
that the ``common and joint costs'' required by Schedule I often do not
include A&G. Thus, the method used by the company to allocate A&G must
be ascertained by means of the discovery process. NGSA submits that to
explicitly include A&G in these regulations would clarify the
requirement, and reduce discovery burden and delay in the rate case
proceeding, and provide parties with important information with respect
to an increasingly important category of costs.
The Commission agrees with NGSA that Schedule I often does not
include the allocation of A&G and this allocation should be included.
Accordingly, Schedule I-1(d) will be revised to include the allocation
of A&G.
10. Statement O
NGSA requests that the rate history filing requirement be retained
but modified to require the company to show its rate history only since
its last major rate filing in Statement O. NGSA submits that retention
of this limited
[[Page 9625]]
form of the rate history requirement does not represent a burden on the
pipeline, and provides parties with important summary information,
difficult to obtain by other means, regarding the levels and effective
periods for rates which have been in effect since the company's last
filing.
NGSA's request is denied. One purpose of the rule was to eliminate
any unnecessary burdens of production to the pipeline company. This
involves avoiding the duplication of information that can be gathered
from another source. The history provided by Statement O is not relied
on in the Commission analysis of a rate proceeding and is available
through the Commission Issuance Posting System (CIPS).
11. Statement P
In the past, pipelines filed their Statement P testimony 15 days
after filing the rate proposal. The Rule requires Statement P to be
filed concurrently with the rate case so as to make a more complete
explanation of the rate proposal available at the outset.
Williston Basin seeks rehearing of this requirement. Williston
Basin states that the removal of this 15-day period unnecessarily
shortens the period in which a pipeline must prepare and file a rate
case. Williston Basin states that the Commission should grant rehearing
so as not to place additional burdens on companies in preparing the
voluminous statements and schedules that must accompany rate case
filings.
This request is denied for the reasons discussed in the Rule.
45 The Commission's experience is that Statement P provides the
most comprehensive description of the proposed rate change. To achieve
its intended purpose of expediting the hearing, Statement P must serve
as the applicant's complete case-in-chief, not a mere description of
proposed rates. 46
\45\ III FERC Stats. & Regs. para. 31,025 at 31,382 and 31,424.
\46\ Statement P requires the pipeline to:
Provide copies of prepared testimony indicating the line of
proof which the company would offer for its case-in-chief in the
event that the rates are suspended and the matter set for hearing.
Name the sponsoring witness of all text and testimony. Statement P
must be filed concurrently with the other schedules.
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It is the pipelines' statutory burden to demonstrate that proposed
rates are just and reasonable. When the rates cannot be determined to
be just and reasonable by the filed material alone, a hearing must be
established. This Rule represents a concerted effort to avoid lengthy
hearings. One way to expedite the process is to get the information
needed to make merits determinations (Statement P) to the Commission
and other parties sooner than under the current regulations.
q. 154.314 Other Support for a Filing
The Rule does not require pipelines to file monthly financial
reports prepared for management purposes and copies of accounting
analyses of balance sheet accounts. 47
\47\ III FERC Stats. & Regs. para. 31,025 at 31,425.
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APGA requests that the Commission grant rehearing and require
pipelines to file financial reports as an integral part of a Section 4
rate filing. APGA submits that a pipeline's financial statements are
essential to an understanding of a pipeline's rate of return
presentation and should be available up front to the parties to a rate
proceeding. APGA states that if information contained in such reports
is deemed commercially sensitive by the pipeline, it may file such
information under seal subject to a protective agreement.
APGA's request is denied. This data is not generally necessary in
the early part of the process. Such information may be obtained through
discovery after a rate case has been set for hearing.
r. Section 154.403 Periodic Rate Adjustments
New Sec. 154.403 governs the passthrough, on a periodic basis, of a
single cost item or revenue item not otherwise covered by subpart E,
such as remaining purchased gas adjustment mechanisms, fuel loss and
unaccounted-for gas, and transition cost filings.
1. Requests for Rehearing
NGSA requests that the Commission reconsider NGSA's suggestions for
periodic rate filing requirements, summarized in the Rule.
Specifically, NGSA suggested the following items be required with
filings made under this section:
a. Reconciliation information for the past period which compares
the volumes and revenues actually recovered to the volumes and costs
used to design the rates previously in effect, with discounted
transactions separately identified, and showing any past period
underrecovery to be included in the new rate;
b. Actual data on costs incurred since the last filing, compared to
the costs on which the previous rates were based;
c. Derivation of any discounting adjustment included in the
proposed rates, citing the authority under which such adjustment is
being made;
d. Citations to data sources and approval order for data used which
is derived elsewhere; and
e. Requirement that costs, volumes, allocation and rate design be
shown by zone of receipt/zone of delivery or other category used to
charge rates, where appropriate.
NGSA is concerned that where information is not required, it is not
likely to be supplied. For example, NGSA states that the regulations do
not require companies to include actual fuel used and fuel retained
from shippers under the existing fuel rates when filing for new fuel
retention rates. Thus, NGSA states, parties do not know if the
pipeline's existing fuel rates have overrecovered or underrecovered
actual fuel costs, and may have no actual basis on which to evaluate
the proposed rates. NGSA states that, pursuant to Sec. 154.403(d)(3)),
actual data are not required by the regulations where the proposed
rates are based on estimates. Consequently, NGSA states, for filing
under this subpart where discovery is not available to interested
parties, there may be no way of obtaining the needed information. NGSA
states that this circumstance would occur, for example, where the
filing has not been set for hearing or where the parties had not
previously agreed to a submission of the data.
2. Commission Response
Section 154.403 is intended to cover a disparate array of potential
cost recovery or revenue credit surcharges, in addition to fuel
reimbursement mechanisms. The regulations adopted are intended to
ensure the widest possible applicability.
The Rule states that the information NGSA seeks will be available
in the filings under this subpart. 48 NGSA requests that the
regulations be revised to require reconciliation information for the
past period which compares the volumes and revenues actually recovered
to the volumes and costs use to design the rates previously in effect.
Section 154.403(c)(6) already requires that where costs or revenue
credits are accumulated over a past period for periodic recovery or
return, the tariff must include provisions to define the past period,
to detail the mechanism for recovering the cost or revenue, to describe
the mechanism for calculating the entries to the deferral account and
for passing through the account balance. Where necessary, the
information NGSA seeks would be covered in the tariff provision
required by Sec. 154.403(c)(6).
\48\ III FERC Stats. & Regs. para. 31,025 at 31,427.
[[Page 9626]]
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Similarly, while the derivation of discounting adjustments is not
specifically listed under the filing requirements in Sec. 154.403(d),
Sec. 154.403(c)(8) requires the tariff to provide, on a step-by-step
basis, how the pipeline's methodology for calculating its surcharge
will be affected by rate discounts. The pipeline must then follow this
methodology when it files to change its rates. When the pipeline files
to establish its methodology in the tariff, sufficient detail must be
incorporated in the tariff to establish the step-by-step calculation
methodology. It is in fashioning the tariff provision that detailed
information requirements will be established such as those NGSA would
include in the regulations. It is not, therefore, necessary for the
regulations to explicitly require discounted transactions to be
separately identified. Nor is it necessary to modify the regulations to
include the requirement that the derivation of any discounting
adjustment be included in the proposed rates.
Some of the data NGSA wishes the regulations to require are already
explicitly required by the new regulations. For example,
Sec. 154.403(d)(1)(ii) requires computations to be shown for each
surcharge or fuel reimbursement percentage to be applied. The
computations should be broken down by service, classification, area,
zone, or other subcategory as appropriate. Therefore, NGSA's request
that the regulations require costs, volumes, allocation, and rate
design be shown by zone of receipt/zone of delivery or other category
used to charge rates would be redundant. In addition,
Secs. 154.403(d)(1) (iv) and (v) require the pipeline to cite the
source of the costs, revenues, rates, quantities, indices, load
factors, percentages, or other numbers used in the calculations. NGSA's
request that citations to data sources be required is, therefore,
already in the regulations.
Section 154.403(c)(5) requires a step-by-step description of the
cost calculation and flowthrough methodology to be included in the
tariff. Any comparison between actual costs incurred and the costs
underlying the previous rate may be appropriate for inclusion in the
methodology required by the referenced section. That determination must
be made at the time the tariff language setting forth the methodology
is accepted.
s. Section 154.501(a)
Section 154.501(a) states that ``[t]he refund plus interest must be
distributed as specified in the Commission order requiring or approving
the refund, or if no date is specified, within 60 days of the order.''
1. Refund Upon Final Order
Williston Basin states that refunds should be required only upon
the issuance of the final Commission order in the proceeding. Williston
Basin states that in an instance where a pipeline requests rehearing or
appellate review of a Commission order imposing refund liability, the
refund should be deferred until after final ruling to avoid the
necessity for further refunds or for the required rebilling of
prematurely refunded amounts. Williston Basin states that it has become
increasingly difficult, if not impossible, to collect prematurely
refunded amounts from transient shippers.
Williston Basin states that shippers are well protected from any
delay they might experience in receiving their refunds since they
receive interest on the amount which the pipeline must refund; thus,
they are made whole for any overpayment amounts which the pipeline
held. Williston Basin states that if pipelines are forced prematurely
to make refunds before a final, nonappealable agency order is issued
pipelines could be left holding an empty bag as they would have to
track down shippers that may no longer exist to recover these premature
refunds.
2. Commission Response
Section 154.501(a) was patterned in part after former
Sec. 154.67(c). Former Sec. 154.67(c) noted that the date of any refund
would be determined in a final Commission order. Section 154.501(a)
retained this provision but added that if no specific date is set, the
refund must be made within 60 days of the order. The regulation did not
specify the procedure to follow in an instance where a pipeline
requests rehearing or appellate review of a Commission order imposing
refund liability. To avoid any confusion, the regulation will be
revised to read that in the event no date for the refund is set by the
Commission order establishing the refund obligation, the refund must be
made within 60 days of a final Commission order. For purposes of this
section, final order will mean an order no longer subject to rehearing.
Williston Basin's request that the refund disbursement be delayed until
after judicial review is denied as inconsistent with the NGA. 49
\49\ Section 19(c) of the NGA provides that:
The filing of an application for rehearing under subsection (a)
shall not, unless specifically ordered by the Commission, operate as
a stay of the Commission's order. The commencement of proceedings
under subsection (b) of this section shall not, unless specifically
ordered by the court, operate as a stay of the Commission's order.
Waiting to disburse a refund until after appeals court review would
entail undue delay and would be inconsistent with current practice.
15 U.S.C. 717r(c).
---------------------------------------------------------------------------
t. Section 501(d)
1. Higher Interest Rate
AGD proposes procedures to reduce the level and duration of
excessive pipeline rate increases including an amendment to
Sec. 154.501(d). AGD proposes that the Commission exercise its
discretion to prescribe a higher interest rate to apply to refunds of
pipeline's excessive charges. The proposed percentage AGD recommends is
one that would be high enough to deter the pipeline from seeking
excessive rate increases so that such increases are limited to those
which can be fully justified. AGD states that such an interest rate
would be equal to the rate of return on equity sought by the pipeline
in its rate filing. AGD states that this interest rate would be a
significant deterrent to a pipeline's unsubstantiated rate increase
proposal and provide the pipeline with a necessary incentive to
cooperate with its customers in the early disposition of its rate
increase proposal, an incentive that no longer exists under the SFV
rate design standard.
2. Commission Response
AGD seeks to change the Commission's provision for carrying charges
under Sec. 154.501(d) from a vehicle to ensure compensation for the
time value of money into an incentive mechanism for modest rate
increase proposals on the part of the pipelines. The Commission does
not intend to change any substantive ratemaking policies through this
Rule. Thus, AGD's request is beyond the scope of the Rule and is
denied.
3. Surcharges
ANR and CIG request clarification that the Commission's intent is
to allow pipelines, that are required to pay surcharges to other
pipelines as a result of a Commission order, to recover such surcharges
from customers within 30 days of the pipeline paying such charges
through the mechanism of a limited section 4 filing.50
\50\ For example, in Docket No. RP91-143-027, 72 FERC para.
61,081 (Remand Order), the Commission directed Great Lakes to
effectuate refunds and surcharges to expansion and pre-expansion
shippers, respectively. Under the clarification sought by ANR and
CIG, pipelines that incur surcharges pursuant to the Remand Order
could file limited section 4 filings seeking authority to increase
their rates to pass through to their shippers the amount of the
Great Lakes surcharge, and such authority would be granted.
[[Page 9627]]
If such clarification is denied, ANR and CIG request rehearing
stating that the change to Sec. 154.501 improperly mandates a one-sided
exception to test period ratemaking. ANR and CIG state that requiring a
pipeline to pay to customers refunds received after the end of the test
period underlying the pipeline's rates violates Secs. 154.303 and
154.63(e)(2) of the Commission's regulations. ANR and CIG state, unless
the Commission implements an exception to this regulation in an even
handed manner, equity dictates that pipelines should not be required to
pass through a refund from an upstream pipeline unless the Commission
determines that the pipeline is overrecovering its costs after
reviewing all of the pipeline's other costs and revenues.
In any event, ANR and CIG request that the 30-day provision be
clarified with respect to minor refunds and surcharges. Specifically,
they request that minor refunds be treated as billing adjustments which
will be reflected in the next billing 30 days subsequent to receipt,
and surcharges be reflected in the next billing 30 days subsequent to
billing.
4. Commission Response
In response to ANR/CIG's comments to the NOPR, the Commission
stated in the Rule that cost increases must be filed for by the
pipeline. Pipelines would not receive automatic passthrough authority
within 30 days of the pipeline paying such charges. A pipeline paying
increased charges to an upstream pipeline must file to recover these
costs through a section 4 filing. The Commission will not prejudge the
proper approach for passing through costs paid to one pipeline by
another. Regulations governing such cost passthrough are contained
elsewhere in Part 154. ANR/CIG's request for clarification is denied.
5. One-Way Tracker
ANR/CIG reiterates, on rehearing, its comment to the NOPR that the
language proposed in the NOPR mandated the institution of a one-way
tracker. In response to that comment, the Commission clarified the
language of Sec. 154.501(a)(2) to ensure that the refund either is a
product of a prior Commission order or occurs in conjunction with a
tracker filing instituted under Sec. 154.403. The provision is not a
universal requirement for flow through of upstream pipeline refunds as
ANR/CIG implies and does not violate the test period concept. This is
so because the refund passthrough either is required by a specific
Commission order or is made in conjunction with a cost tracking
provision approved by the Commission. A cost tracker permits the
pipeline to recover costs paid subsequent to the end of the test period
without having to file a general rate case and submit to a review of
all costs and revenues. Therefore, to ensure those costs are not over-
recovered, refunds of costs collected from customers by means of a rate
established under a tracking mechanism must be flowed through to
customers.
6. Minor Refunds
ANR/CIG request clarification that the 30-day provision relates to
minor refunds and surcharges. Sections 154.501 and 154.502 relate
solely to refunds, not to surcharges.
The Commission adopted a single generic standard of 30 days to pass
through refunds. The difficulty with making an exception for minor
refunds is defining what constitutes a minor refunds. A minor amount on
one pipeline may represent a significant amount on another pipeline. It
is preferable to have a single generic standard. The Commission will
review requests for exceptions for disbursing minor refunds through
billing adjustments on a case-by-case basis, thereby allowing such a
provision to be tailored to the specific circumstances of each
pipeline.
u. Topsheets
APGA requests rehearing of the Commission's determination that it
should not establish a time frame for the submission of Staff
topsheets.
This matter has been fully considered and discussed in the Rule.
APGA's arguments do not warrant further consideration or a different
conclusion. This request is denied for the reasons discussed in the
Rule.51
\51\ III FERC Stats. & Regs. para. 31,025 at 31,431.
---------------------------------------------------------------------------
v. Bifurcation
AGD suggests, as a strategy to expedite pipeline rate case
decisions, an early bifurcation of a given proceeding into two separate
categories for decisionmaking. The Commission's suspension order in a
pipeline rate case would divide the issues to be addressed by the ALJ
and the parties in two categories, one of which would be subject to a
final Commission decision deadline of 12 months from the filing date,
while the other category could have a different Commission decision
deadline. In the first, 12 months-to-decision category, the issues
would include those concerning the pipeline's filed-for cost of service
and its throughput and/or other issues which lend themselves to prompt
decisions. The Commission's rules would provide that, in the absence of
compelling reasons, all rate case issues concerning the pipeline's cost
of service and its throughput volume, including rate of return,
depreciation rate and other similar issues would be addressed by the
ALJ and by the Commission within 12 months of the filing date.
The second category of issues would be those concerning the
pipeline's rate design and/or its allocation of costs among functions
and among customers according to their rate schedule. This latter
category of issues may involve more complex questions and may require
the use of expert testimony, exhibits and other evidence to frame the
issues for Commission decision.
The Commission recognizes that the proposed procedure might have
the effect of expediting pipeline rate case decisions. However, before
implementation, the Commission would require more study as to the
potential effects of such a procedure on the rate case as well as what
further changes would have to be made to the filing requirements. The
suggested change is simply beyond the scope of the purposes of this
Rule and will not be adopted.
w. Electronic Pleading
NGC states that the Commission on rehearing should add to its list
of goals the electronic service of pleadings. NGC states that, with the
internet and world-wide web gaining such increased prominence in recent
months, it is time the Commission implemented electronic service
through the CIPS system.
Expanding electronic filing requirements to pleadings is outside
the scope of this rulemaking.
x. Suspension of Electronic Filing
The Commission is suspending the requirement to submit filings
under subpart D electronically until the new electronic filing
requirements are fully developed.52
\52\ III FERC Stats. & Regs. para. 31.025 at 31,433.
---------------------------------------------------------------------------
INGAA seeks clarification that after electronic filing requirements
have been finalized, there would be a period of six months for
pipelines to develop internal software and procedures that match their
data to the newly developed electronic filing requirements. During this
period, pipelines would continue to file rate cases on paper.
In accordance with the Rule, staff convened an informal conference
on December 1, 1995, to discuss issues
[[Page 9628]]
relating to electronic filing which had not been resolved. Issues
relating to the Index of Customers and discount rate filings have been
resolved. The final specifications will be issued shortly. Two working
groups were established--one to complete work on Form Nos. 2, 2A and 11
and one to complete work on rate case filings. The working groups met
on December 12, 1995, February 7, 1996 and February 8, 1996.
The Commission expects to have work completed on Form No. 11 in
time for the first filings due on May 15, 1996. Given the relative
simplicity of the Form No. 11, there should be no difficulty meeting
this timetable. A delay of six months is excessive for this filing.
The Form Nos. 2, and 2A, and rate case filings, however, are far
more complex. Form Nos. 2 and 2A must be filed electronically on April
30, 1997. However, staff and the Working Group--Forms are urged to use
due diligence to complete the filing specifications by October 31,
1996, in order to provide the six month preparation time INGAA seeks.
As regards electronic filing for rate cases, the Commission will
not adopt INGAA's proposal that its implementation be delayed until six
months after the Commission issues the electronic filing
specifications. Several pipelines in the working group are providing
test files of rate case data in the new file format. It is preferable
to wait until the working group process is complete and staff has
better information about the amount of time the test pipelines required
to create files in the new file format before making a decision on the
appropriate amount of delay between the issuance of file specifications
and implementation of the electronic filing requirements for rate
cases. Therefore, the Commission will defer making a ruling on this
issue until staff issues the file specifications for the rate case.
y. Effective Date
The final rule became effective on November 13, 1995, 30 days after
publication in the Federal Register.
The NOPR proposed that the revised regulations would be effective
90 days after publication in the Federal Register.53 However, the
Rule made the revisions effective 30 days after publication in the
Federal Register.54
\53\ IV FERC Stats. & Regs. para. 32,511 at 32,944.
\54\ III FERC Stats. & Regs. para. 31,025 at 31,375.
---------------------------------------------------------------------------
INGAA states that it would be impossible for pipelines who might be
in the process of preparing a rate case to implement the Rule within 30
days. INGAA seeks clarification that the effective date will be 90 days
after publication in the Federal Register. The Rule already is in
effect. Thus, this request is denied as the issue is moot.
INGAA also seeks clarification that the order does not apply to
pending rate cases. This request is granted.
ANR and CIG request clarification of when pipelines are required to
make changes to their tariff to bring the tariff into compliance with
the new Rule. In some instances, such as a filing for a rate change, it
is clear that the next filing would trigger the Rule's requirements.
However, it is not clear when pipelines will have to make other
revisions to their present tariffs, such as conforming the title page
of their tariff to the new Rule's requirements or providing
explanations of policies on such issues as discounts.
The Commission clarifies that all filings and tariffs on file must
be in compliance with the revised regulations no later than December
31, 1996.
List of Subjects in 18 CFR Part 154
Alaska, Natural Gas, Pipelines, Reporting and recordkeeping
requirements.
The Commission Orders
(A) The requests for rehearing and clarification of Order No. 582,
the final rule issued in this docket on September 28, 1995, are granted
and denied as discussed in the text of this order.
(B) All filings and tariffs on file must be in compliance with the
revised regulations promulgated by Orders No. 582 and 582-A, no later
than December 31, 1996. By the Commission.
Lois D. Cashell,
Secretary.
In consideration of the foregoing, the Commission is amending part
154, Chapter I, Title 18, Code of Federal Regulations, as set forth
below.
PART 154--RATE SCHEDULES AND TARIFFS
1. The authority citation for part 154 continues to read as
follows:
Authority: 15 U.S.C. 717-717w; 31 U.S.C. 9701; 42 U.S.C. 7102-
7352.
2. Section 154.7 is amended by revising paragraph (a)(6) to read as
follows:
Sec. 154.7 General requirements for the submission of a tariff filing
or executed service agreement.
* * * * *
(a) * * *
(6) A statement of the nature, the reasons, and the basis for the
filing. The statement must include a summary of the changes or
additions made to the tariff or executed service agreement, as
appropriate. The statement must include a quantified summary comparing
the cost of service, rate base and throughput underlying each change in
rate made to the tariff or executed service agreement compared to the
same information underlying the last rate found by the Commission to be
just and reasonable. A detailed explanation of the need for each change
or addition to the tariff or executed service agreement must be
included. The natural gas company also must note all relevant
precedents relied upon to prepare its filing.
* * * * *
Sec. 154.101 [Amended]
3. In Sec. 154.101, the words ``\1/4\ inches'' are removed and the
words ``1\1/4\ inches'' are added in their place.
4. Section 154.208 is amended by revising paragraph (c) and adding
paragraph (d) as follows:
Sec. 154.208 Service on customers and other parties.
* * * * *
(c) Within two business days of receiving a request for a complete
copy from any customer or state commission that has not made a standing
request, the company must serve a full copy of any filing.
(d) A customer or other party may designate a recipient of service.
The filing company must serve the designated recipient, in accordance
with paragraphs (a), (b) and (c) of this section, instead of the
customer or other party. For the purposes of this section, service upon
such designated recipient will be deemed service upon the customer or
other party.
5. Section 154.301 is amended by revising paragraph (c) as follows:
Sec. 154.301 Changes in rates.
* * * * *
(c) A natural gas company filing for a change in rates or charges
must be prepared to go forward at a hearing and sustain, solely on the
material submitted with its filing, the burden of proving that the
proposed changes are just and reasonable. The filing and supporting
workpapers must be of such composition, scope, and format as to
comprise the company's complete case-in-chief in the event that the
change is suspended and the matter is set for hearing. If the change in
rates or charges presented are not in full accord with any prior
Commission decision directly involving the filing company, the company
must include in its working
[[Page 9629]]
papers alternate material reflecting the effect of such prior decision.
6. Section 154.303 is amended by revising paragraph (c)(2) to read
as follows:
Sec. 154.303 Test periods.
* * * * *
(c) * * *
(2) When a pipeline files a motion to place the rates into effect,
the filing must be revised to exclude the costs associated with any
facilities that will not be in service as of the end of the test
period, or for which certificate authorization is required but will not
be granted as of the end of the test period. At the end of the test
period, the pipeline must remove from its rates costs associated with
any facility that is not in service or for which certificate authority
is required but has not been granted.
* * * * *
7. Section 154.304 is amended by revising paragraphs (b) and (c) to
read as follows:
Sec. 154.304 Format of statements, schedules, workpapers and
supporting data.
* * * * *
(b) The data in support of the proposed rate change must include
the required particulars of book data, adjustments, and other
computations and information on which the company relies, including a
detailed narrative explanation placed at the beginning of the specific
statement or schedule to which they apply, explaining each proposed
adjustment to base period actual volumes and costs.
(c) Book data included in statements and schedules required to be
prepared or submitted as part of the filing must be reported in a
separate column or columns. All adjustments to book data must also be
reported in a separate column or columns so that book amounts,
adjustments thereto, and adjusted amounts will be clearly disclosed.
All adjustments must be supported by a narrative explanation placed at
the beginning of the specific statement or schedule to which they
apply.
* * * * *
8. Section 154.311 is revised to read as follows:
Sec. 154.311 Updating of statements.
(a) Certain statements and schedules in Sec. 154.312, that include
test period data, must be updated with actual data by month and must be
resubmitted in the same format and with consecutive monthly totals for
each month of the adjustment period with a single set of updates
encompassing a 12-month period. The updated statements or schedules
must be filed 45 days after the end of the test period. The updated
filing must be provided to parties specifically requesting them. The
updated filing must reference the associated docket number and must be
filed in the same format, form, and number as the original filing.
(b) The statements and schedules in Sec. 154.312 to be updated are:
Statements C, D and H-4; Schedules B-1, B-2, C-3, D-2, E-2, E-4, G-1,
G-4, G-5, G-6, H-1 (1)(a), H-1 (1)(b), H-1 (1)(c), H-1 (2)(a) through
H-1 (2)(k), H-2 (1), H-3 (3), I-4, and I-6.
(c) This requirement to file updates may be extended by the
Secretary pursuant to Sec. 375.302 of this chapter.
9. Section 154.312 is amended by revising paragraphs (d)(1),
(k)(1), (k)(15)(iv) and (o)(1)(iv) as follows:
Sec. 154.312 Composition of Statements.
* * * * *
(d) * * *
(1) Schedule D-1. This schedule is part of the workpapers. Show the
depreciation reserve book balance applicable to that portion of the
depreciation rate not yet approved by the Commission, the depreciation
rates, the docket number of the order approving such rate, and an
explanation of any difference. Reflect actual end of base period
depreciation reserve functionalized and test period depreciation
reserve functionalized. Show accumulated depreciation and amortization,
in columnar form, for the ending base and test period balances by
functional classifications of Accumulated Depreciation reserve.
(Examples are provided in Schedule C-1). For each functional plant
classification, show depreciation reserve associated with offshore and
onshore plant separately.
* * * * *
(k) * * *
(1) Schedule H-1 (1). This schedule is part of the workpapers. Show
the labor costs, materials and other charges (excluding purchased gas
costs) and expenses associated with Accounts 810, 811, and 812 recorded
in each gas operation and maintenance expense account of the Uniform
System of Accounts. Show these expenses, under the columnar headings,
with subtotals for each functional classification, as follows:
operation and maintenance expenses by months, as booked, for the 12
months of actual experience, and the 12-month total; adjustments, if
any, to expenses as booked; and total adjusted operation and
maintenance expenses. Disclose and explain all accrual on the books at
the end of the base period or other normalizing accounting entries for
internal purposes reflected in the monthly expenses presented per book.
Explain any amounts not currently payable, except depreciation charged
through clearing accounts, included in operation and maintenance
expenses.
* * * * *
(15) * * *
(iv) The bases used in determining the amounts of the charges
(credits). Explain and demonstrate the derivation of the allocation
bases with underlying calculations used to allocate costs among
affiliated companies, and identify (by account number) all costs paid
to, or received from affiliated companies which are included in a
pipeline's cost-of-service for both the base and test periods.
* * * * *
(o) * * *
(1) * * *
(iv) Schedule I-1(d). Show the method used to allocate common and
joint costs to various functions including the allocation of A&G.
Provide the factors underlying the allocation of general costs (e.g.,
miles of pipe, cost of plant, labor). Show the formulae used and
explain the bases for the allocation of common and joint costs.
* * * * *
10. Section 154.501 is amended by revising paragraph (a)(1) to read
as follows:
Sec. 154.501 Refunds.
(a) Refund Obligation. (1) Any natural gas company that collects
rates or charges pursuant to this chapter must refund that portion of
any increased rates or charges either found by the Commission not to be
justified, or approved for refund by the Commission as part of a
settlement, together with interest as required in paragraph (d) of this
section. The refund plus interest must be distributed as specified in
the Commission order requiring or approving the refund, or if no date
is specified, within 60 days of a final order. For purposes of this
paragraph, a final order is an order no longer subject to rehearing.
The pipeline is not required to make any refund until it has collected
the refundable money through its rates.
* * * * *
Note: This Appendix will not appear in the Code of Federal
Regulations.
Appendix
Minor modifications are made to the electronic filing
instructions for tariff sheets. The instructions for completing the
``TF07''
[[Page 9630]]
record have been corrected. In the previous version of these
instructions, the position for the FERC Cite was erroneously given
as character position 43-49. The correct character position is 5-11.
The Commission's software, the FERC Automated System for Tariff
Retrieval, FASTR, will recognize the FERC cite whether entered in
positions 43-49 or 5-11. The Commission is allowing pipelines to
file other electronic filings on CD-ROM. The Commission will extend
this option to electronic tariff filings as well.
Natural Gas Pipeline Company Tariff Filings
Revised
Docket No. RM95-3-001
------------------------------------------------------------------------
Expiration
OMB Nos. date
------------------------------------------------------------------------
1902-0066.................................................. 5/31/97
1902-0070.................................................. 5/31/97
1902-0152.................................................. 5/31/97
1902-0153.................................................. 5/31/97
1902-0154.................................................. 6/30/96
1902-0155.................................................. 5/31/97
------------------------------------------------------------------------
This document replaces the Tariff Filing Record Formats issued
August 31, 1989.
General Information
I. Purpose
All companies which maintain a gas tariff with the Federal
Energy Regulatory Commission (FERC) are required to submit, along
with the paper copies, an electronic version of all tariff filings
pursuant to section 385.2011 of the Commission's regulations.
Companies are required to have an electronic version of their entire
gas tariff (excluding Volume No. 2 contractual rate schedules) on
file with FERC on or before January 26, 1996 This form does not
modify the existing tariff sheet format required in section 154.102
or section 385.2003 for tariff sheets filed on paper. Nor does it
modify the requirement in section 154.201(a) to file a marked paper
version of the pages to be changed by showing additions and
deletions using highlighting, background shading, bold text, or
underlined text.
II. Who Must File
All companies who are required to maintain a FERC Gas Tariff on
file with the FERC.
III. What To Submit
All proposed revisions to the FERC Gas Tariff will be submitted
in conformance with this form. Such proposed revisions include, but
are not limited to, rate changes pursuant to a Section 4 filing or
changes in service pursuant to a certificate issued as a result of a
section 7 proceeding. Upon request of the Secretary of the FERC,
companies must submit such additional supporting and clarifying data
and information as may be specified.
All data will be submitted on diskette(s), preferably 3.5'' High
Density diskettes, and must conform to the specific instructions
provided in Exhibit A. Optionally, data may be submitted on CD.
Filings in this medium must conform to the specifications in Exhibit
A. The diskette(s) or CD(s) must be accompanied by paper copies of
the information submitted on the diskette. The paper copies must
conform in all respects to the requirements of sections 154 and 157
and will consist of the required number of copies of the transmittal
letter, the tariff sheets, the certification of service, and a form
of notice suitable for publication in the Federal Register.
The letter of transmittal and the certification of service will
be submitted on paper only. The letter of transmittal must include
the subscription provided in section 385.2005(a). The subscription
provided must state, in addition to the requirement in section
385.2005(a), that the paper copies contain the same information as
the diskette(s) and that the signer has read and knows the contents
of the paper copies and that the contents as stated in the paper
copies are true to the best knowledge and belief of the signer.
Respondents claiming that information is privileged must file in
accordance with section 385.1112; otherwise, all data submitted will
be considered non-privileged and will be made available to the
public upon request.
IV. When To Submit
The tariff sheets should be filed with the Commission at the
time the company proposes a change in service or rate. The notice
period should be consistent with the Commission's regulations.
V. Where To Submit
(1) Submit this report to: Office of the Secretary, Federal
Energy Regulatory Commission, Washington, DC 20426.
(2) Hand deliveries may be made to the same address.
You shall not be penalized for failure to respond to this
collection of information unless the collection of information
displays a valid OMB control number.
General Instructions
(1) Schedule TF. Records TF01 through TF07 and the text line
records are intended to capture all of the tariff elements which the
pipeline has historically filed as part of its FERC Gas Tariff.
Record TFO1 identifies the company and the filing date. Record TF02
captures information about the tariff volume; and Records TF03,
TF04, TF05, TF06, and TF07 contain requisite marginal information
for an individual tariff sheet. The actual tariff sheet text will
follow Record TF07.
Each tariff sheet should be identified by the nature of the
sheet, and assigned the appropriate ``Text ID'' from among those
listed in the layout for Record TF03. For example, a tariff sheet
which includes the table of contents must be assigned Text ID =
``1''. The text of a tariff sheet should include any footnotes
applicable to the individual tariff sheet. When filing the tariff
sheet on paper, footnotes should appear inside the ruled borders
required by section 154.101.
All of the marginal information required under 18 CFR
Sec. 154.102(d) is to be included only in the tariff sheet header
records. These header records will be utilized to print a hard copy
with the appropriate marginal information.
If a tariff sheet is filed to be read vertically in hard copy,
this is referred to hereinafter as ``Portrait'' orientation. If the
sheet will be read horizontally, the orientation is referred to as
``Landscape.'' The requirements of section 154.101 imply that the
length of a line of actual text is 6.75 inches in Portrait
orientation, and 10.0 inches in Landscape. The pitch, the number of
print characters per horizontal inch (cpi); the number of lines per
vertical inch (lpi); and the page orientation for printing the
tariff sheet must be given in the first Tariff Sheet Header Record,
(Record TF03). The number of characters per horizontal inch (cpi)
must not exceed 17. The acceptable lines per vertical inch are 6 or
8. The maximum line length and lines per page for Portrait and
Landscape orientation are as follows:
------------------------------------------------------------------------
Maximum line length Maximum
(characters) lines per
Page orientation ---------------------------- page
-------------
10cpi 12cpi 15cpi 17cpi 6lpi 8lpi
------------------------------------------------------------------------
Vertical (portrait)........... 65 79 98 112 50 70
Horizontal(landscape)......... 98 118 148 168 31 44
------------------------------------------------------------------------
(2) Record Types. Records must be filed in the following order:
Company Header Record (TF01): One record per dataset.
Volume Header Record (TF02): One record per volume. All pages
for the same volume will be grouped together. If more than one
dataset is required for the filing of a volume, this record must
appear in each dataset. Note: When more than one dataset is needed
to accommodate a filing, name the datasets in accordance with the
instructions in Exhibit A.
Note: The Appropriate Tariff Sheet Header Records Must Precede
Each Tariff Sheet!
Sheet Header Record (TF03): One record per sheet.
[[Page 9631]]
Superseded Sheet Header Record (TF04): This record pertains to
the superseded sheet information. One record per sheet unless there
is no superseded sheet (e.g., Original and Substitute Original
sheets). In that case, this record may be omitted.
Issuing Officer Header Record (TF05): One record per filing,
unless the filing contains sheets that reference more than one
issuing officer or the tariff sheets are submitted in more than one
dataset. Optionally, this record may precede every tariff sheet
filed.
Date and Docket Header Record (TF06): One record per filing,
unless the effective date or other information in this record
changes from sheet to sheet or the tariff sheets are submitted in
more than one dataset. Optionally, this record may precede every
tariff sheet filed.
FERC Cite (TF07): One record per sheet. This header record
should only accompany tariff sheets filed in compliance with an
order of the Commission.
Text Line Records: The actual tariff sheet text. Note: any
special codes placed in the text (such as bold, italic, underline,
etc.) are removed when converting to ASCII format.
(3) Numeric Fields. All numeric fields in Records TF01 through
TF06 must not be left blank, and must be right justified unless
indicated otherwise. The following conventions should be followed in
preparing each header record in the filing:
(A) If a numeric data item is not applicable to the respondent,
enter the numeric value ``0'' in the field provided for this data
item.
(B) Do not include commas in reporting any numeric value.
(C) Report all dates as six digit numerics (month, day, year,
MMDDYY).
(4) Pipeline Company ID. Use the code for the pipeline as
contained in the Buyer Seller Code List, U.S. Department of Energy's
publication DOE/EIA-0176. A code may be obtained by calling EIA at
(202) 586-8841.
(5) Record Lengths. Do not pad the end of data records with
blanks.
Specific Instructions
(1) Effective Date. The date, given as month, day, and year, on
which the respondent expects the filing to be put into effect
subject to the concurrence of the FERC.
(2) Tariff Volume Number. The number of the volume to which the
tariff sheets belong. For example, if the volume is labeled ``Second
Revised Volume No. 1,'' report a ``1'' in this field.
(3) Tariff Volume Revision Number. Report the number of the
revision. For example, if the tariff volume is labelled ``Second
Revised Volume No. 1,'' report a ``2'' in this field. If the tariff
volume is an original volume, report a zero in this field.
(4) Tariff Volume ID. Report the full tariff volume name in this
field. For example, if the volume is labelled ``First Revised Volume
No. 1,'' report ``First Revised Volume No. 1'' in this field.
(5) Sheet Number. Report the number of the tariff sheet being
filed. For example, if the sheet is numbered ``First Revised Sheet
No. 3 superseding Original Sheet No. 3,'' report a ``3'' in this
field.
(6) Sheet Revision Number. Report the number of the revision.
For example, if the tariff sheet is numbered ``Second Substitute
Third Revised Sheet No. 4 superseding Second Revised Sheet No. 4,''
report a ``3'' in this field. If this is an original tariff sheet,
report a ``0'' in this field.
(7) Sheet ID. Report the full designation for the tariff sheet
being reported. For example, if the sheet is designated ``First
Revised Sheet No. 3 superseding Original Sheet No. 3,'' report
``First Revised Sheet No. 3'' in this field. If the Sheet ID exceeds
the allowed 40 character positions for this item, use the
``Abbreviation Conventions List'' at Exhibit C.
(8) Superseded Sheet ID. Report the full designation for the
tariff sheet being superseded. For example, if the tariff sheet
being filed is designated ``First Revised Sheet No. 3 superseding
Original Sheet No. 3,'' report ``Original Sheet No. 3'' in this
field. If the Superseded Sheet ID exceeds the allowed 40 character
positions for this item, use the ``Abbreviation Conventions List''
at Exhibit C.
(9) First Superseded Sheet Number. When a single sheet
supersedes a range of sheets (such as canceling a rate schedule or
reserving sheets for future use), report the number of the first
sheet in the range. Otherwise this field may be left blank.
(10) Last Superseded Sheet Number. When a single sheet
supersedes a range of sheets (such as canceling a rate schedule or
reserving sheets for future use), report the number of the last
sheet in the range. Otherwise this field may be left blank.
(11) Alternate Sheet ID. When filing primary and alternative
tariff sheets, the sheets are uniquely identified by reporting
``00'' in this field for the primary sheet, ``01'' for the first
alternate, ``02'' for the second alternate, and so on.
(12) Issuing Officer. Report the name and title of the person
authorized to issue the tariff sheet.
(13) Issue Date. The date given as month, day, and year when the
tariff sheet is issued.
(14) Order Reference. For tariff sheets which are filed to make
rate schedules or provisions ordered by the Commission effective,
report the Docket Number and the date of such order. (If more than
one docket applies, report the lead docket relating to the filing
company in the proceeding.)
(15) FERC Cite. In this field, enter the numbers of the cite to
the FERC Reports for the order listed in ``Order Reference'' as
follows: For a citation which appears as 12 FERC para. 34,567, enter
all of the numbers but none of the letters, symbols, or commas. It
will appear as 1234567. If the order has no FERC Reports citation,
do not enter a TF07 record.
Electronic Tariff File Layout--Schedule TF
----------------------------------------------------------------------------------------------------------------
Character
Item position Data type Comments
----------------------------------------------------------------------------------------------------------------
(1) Company Header Record:
Schedule ID............................ 1-2 character.................. sch=TF.
Record ID.............................. 3-4 numeric.................... code=01.
Company ID............................. 5-10 numeric.................... company code from buyer/seller
code list, see general
instruction 4.
Date Submitted......................... 11-16 numeric.................... month, day and year report is
filed (mmddyy).
Company Name........................... 17-65 character.................. name of filing company.
(2) Volume Header Record:
Schedule ID............................ 1-2 character.................. sch=TF.
Record ID.............................. 3-4 numeric.................... code=02.
Tariff Volume Number................... 5-8 character.................. see specific instruction 2.
Tariff Volume Revision Number.......... 9-11 numeric.................... see specific instruction 3.
Tariff Volume ID....................... 12-51 character.................. see specific instruction 4.
(3) Sheet Header Record:
Schedule ID............................ 1-2 character.................. sch=TF.
Record ID.............................. 3-4 numeric.................... code=03.
Sheet Number........................... 5-12 character.................. see specific instruction 5.
Sheet Revision Number.................. 13-15 numeric.................... see specific instruction 6.
Alternate Sheet ID..................... 16-17 numeric.................... see specific instruction 11.
Text ID................................ 18-19 numeric.................... 0=Title Page.
.......... ........................... 1=Table of Contents.
[[Page 9632]]
.......... ........................... 2=Preliminary Statement.
.......... ........................... 3=Rate Sheets.
.......... ........................... 4=Rate Schedule Text.
.......... ........................... 5=General Terms and
Conditions.
.......... ........................... 6=Form of Service Agreements.
.......... ........................... 7=Index of Customers.
.......... ........................... 8=Other Indices.
.......... ........................... 9=Other Tariff Sheets.
.......... ........................... 10=Sheets Reserved for Future
Use.
Orientation............................ 20 character.................. P=Portrait.
.......... ........................... L=Landscape.
Pitch.................................. 21-22 numeric.................... Characters per Horizontal
Inch=10, 12, 15, or 17.
Lines Per Inch......................... 23 numeric.................... Lines per Vertical Inch=6 or
8.
Sheet ID............................... 24-63 character.................. see specific instruction 7.
(4) Superseded Sheet Header Record:
Schedule ID............................ 1-2 character.................. sch=TF.
Record ID.............................. 3-4 numeric.................... code=04.
First Superseded Sheet Number.......... 5-12 character.................. see specific instruction 9.
Last Superseded Sheet Number........... 13-20 character.................. see specific instruction 10.
Superseded Sheet ID.................... 21-60 character.................. see specific instruction 8.
(5) Issuing Officer Header Record:
Schedule ID............................ 1-2 character.................. sch=TF.
Record ID.............................. 3-4 numeric.................... code=05.
Issued By.............................. 5-58 character.................. name and title of issuing
official; see specific
instruction 12.
(6) Date and Docket Header Record:
Schedule ID............................ 1-2 character.................. sch=TF.
Record ID.............................. 3-4 numeric.................... code=06.
Date Issued............................ 5-10 numeric.................... (mmddyy); see specific
instruction 13.
Order Date............................. 11-16 numeric.................... (mmddyy); see specific
instruction 14.
Docket Number.......................... 17-36 character.................. see specific instruction 14.
Effective Date......................... 37-42 numeric.................... (mmddyy); see specific
instruction 1.
(7) FERC Cite:
Schedule ID............................ 1-2 character.................. sch=TF.
Record ID.............................. 3-4 numeric.................... code=07.
FERC Cite.............................. 5-11 numeric.................... see specific instruction 15.
(8) Sheet Text Line Records: Each entire record consists of the text of the corresponding line of the tariff
sheet, without prefix of any kind.
----------------------------------------------------------------------------------------------------------------
Exhibit A--Filing Procedures
Diskette(s) or CD(s) containing the information specified for
each record ID of the tariff filing filed with the FERC must conform
with the following requirements:
(1) The character code for representing all data should be the
American National Standard Code for Information Interchange (ASCII)
as defined in FIPS PUB 1-2. An exception will be made for the cents
( cents) symbol, which should be coded as hexadecimal 8B, or decimal
155, as defined in the IBM-US (PC-8) symbol set. Note that there are
symbol sets which define it differently.
(2) The definitions, instructions, and schedule ID/record ID
data layouts for this form specify explicitly the data items to be
reported and the sequence for recording the information on the
diskette(s) or CD(s). The information required for a tariff filing
should be recorded on the diskette(s) or CD(s) exactly as specified
in the data layout for each schedule/record and in accordance with
the general instructions.
(3) All tariff sheets filed under a given docket number should
all be included in the same ``file'' or data set, if possible.
(Large files may be split as a matter of convenience or diskette
size limitation). The file should be named: ``TFMMDDYY.ASC'' where
``TF'' stands for ``Tariff Filing'', and ``MMDDYY'' is the two-digit
month, day, and year the tariff filing is submitted. If more than
one tariff filing is made on the same day, the subsequent filings
should be given file names ``TFMMDDYY.BSC'', ``TFMMDDYY.CSC'', etc.,
where ``BSC'' indicates the second filing of the day, ``CSC'' the
third filing, etc. The file name for each submission must be
included in the transmittal letter accompanying the respondent's
filing.
(4) Each logical record must be terminated by a CR (ASCII
carriage return-13 decimal, OD hexadecimal). An ASCII line feed (LF)
following a CR is accepted but not required as part of termination.
Do Not pad the end of data records with spaces.
(5) Do not omit any numeric item. Numeric items do not require
leading zeros unless specifically noted in the description of the
data item. See the General Instructions of this form for detailed
instructions for recording numeric data on the diskette(s).
(6) When refiling only to correct an electronic data error on
the electronic version of a tariff sheet and not in the paper
version, use the same file name, pagination and submittal date.
(7) Each diskette must have a label affixed to it stating the
pipeline's name. The CD must be enclosed in an appropriate disc
protector with a label affixed to the protector stating the
pipeline's name. The label must also state that tariff sheets are
enclosed. If more than one diskette is necessary to accommodate a
filing, the diskettes should be numbered 1 of N, 2 of N, etc., where
N is the total number of diskettes.
CD Specifications
Filing on CD is an option for those respondents who wish to do
so. However, all data filed on CD must adhere to the following two
constraints:
1. All data submitted must be on CD-Recordable (CD-R) media or
traditional CD-ROM media.
2. The file directory structure of the CD must adhere to the ISO
9660 Level One standard.
What is CD-R and how does it differ from traditional CD-ROM
media?
CD-R is a technology that allows for creating CD-ROMs on the
desktop more cheaply than traditional CD-ROM media. Traditional CD-
ROMs are made by using a laser to ``burn'' pits in a thin metallic
layer thus recording the binary data. By comparison CD-R uses
special discs impregnated with an organic dye which serves the same
function as the pits, but at a much lower cost. Both kinds of discs
are readable with a traditional CD-ROM drive. Other kinds of discs,
magneto optical, or floptical discs are not readable by the common
CD-ROM drive and require a different system altogether.
What is Level One ISO 9660?
[[Page 9633]]
The ISO 9660 standard is for file directory systems on CD-ROMs.
It is a non-proprietary standard and can be used on different
platforms. It defines naming conventions, and directory depth. There
are two main levels of ISO 9660: level one and level two. The major
difference lies within the naming conventions. Level one ISO 9660
allows for MS-DOS style filenames (eight character and three
character extensions). Level two ISO 9660 allows for thirty-two
character filenames. Because the commission relies upon MS-DOS
compatible personal computers, data submitted on CD-ROMs must be in
compliance with Level One ISO 9660.
Exhibit B--Tariff Sheet Pagination Guidelines
Section 154.102(d)(2) of the Commission's regulations requires
companies to number their tariff sheets as provided below.
(1) Original Sheets. Paginate a sheet as ``Original Sheet No.
____'' when the sheet number has not been used previously in the
tariff volume. When filing an entire original or revised tariff
volume, all sheets should be paginated as ``Original Sheet No.
____'' unless the sheet falls within the exception under Guideline
(11).
(2) Revised Sheets. Designate a sheet as ``Revised'' if it is
(a) filed in a different proceeding than the sheet it is superseding
or (b) filed in the same proceeding but given a new proposed
effective date. Each subsequent ``Revised'' pagination should be
numbered sequentially. (See Examples 1 and 2.)
(3) Substitute Sheets. Designate a sheet as ``Substitute ____
Revised Sheet No. ____'' if it is filed to replace a sheet filed in
the same proceeding with the same effective date. If a substitute
sheet needs to be replaced, paginate the new sheet as ``Second
Substitute,'' and so on. (See Example 1.)
(4) Superseded Sheets. Designate as the superseded sheet the
most recent sheet filed in a different proceeding effective or
proposed to be effective on the same day or on a day prior to the
new sheet. This means when filing a substitute sheet the designated
superseded sheet stays the same. Provided that the sheet does not
fall under the exception in guideline (9). Never designate a
rejected or suspended sheet as the superseded sheet. However, if a
sheet designated as superseded is subsequently rejected, it is not
necessary to refile solely to correct the superseded sheet
designation. (See Example 1.)
(5) Rejected Sheets. If a sheet is rejected by order of the
Commission, do not reuse the pagination of the rejected sheets.
Designate a sheet ``Substitute'' if it is filed to replace a
rejected sheet in the same proceeding, but do not designate a
rejected sheet as the superseded sheet. Refer to Guidelines (3) and
(4).
(6) Alternate Sheets. When filing two versions of a proposed
tariff sheet, designate the sheets `` ____ Revised Sheet No. ____''
and ``Alternate ____ Revised Sheet No. ____.'' Paginate a
replacement alternate sheet ``Sub Alternate.''
(7) Inserted Sheets. Designate sheets inserted between two
consecutively numbered sheets using an uppercase letter following
the first sheet number (e.g., sheets inserted between sheets 8 and 9
would be 8A, 8B, etc.). For sheets inserted between two
consecutively lettered sheets, add a ``.'' followed by a two digit
number (e.g., sheets inserted between sheets 8A and 8B would be
8A.01 through 8A.99). For further insertions, add a lowercase letter
(e.g., between sheets 8A.01 and 8A.02 would be 8A.01a, 8A.01b,
etc.).
(8) Pre-dated Sheets. When a sheet is filed with a proposed
effective date which pre-dates the effective date of a suspended or
effective sheet with the same number filed in a different
proceeding, designate the new sheet ``____ Rev ____ Revised Sheet
No. ____'' where the second and third blanks are numbered the same
as the sheet with the later effective date and the first blank
contains ``1st,'' ``2nd,'' etc. Commonly, this situation occurs when
a sheet is suspended for five months and subsequent sheets need to
be made effective prior to the date the suspended sheet becomes
effective. (See Example 3.) Note: When using the ``1st Rev''
pagination, drop extraneous words if the superseded sheet provides
the same information. (See Example 4.)
(9) Retroactive Sheets. When filing a retroactive change back to
a certain date, all sheets which are or were in effect from that
date forward need to be changed. The first sheet should be
designated either as ``Substitute'' in accordance with Guideline (3)
above or ``____ Rev'' in accordance with Guideline (8), depending on
whether the retroactive filing is in the same docket as or a
different docket from the sheet being replaced. The rest of the
sheets should be designated as a ``Substitute'' of each sheet
already on file. For the first new sheet in the series of sheets,
the superseded sheet shall be designated in accordance with
Guideline (4) above. However, the remainder of the sheets in the
series should supersede each other in order, even though they are
all filed in the same docket. In this way, the ``superseded''
designation will reflect the last sheet in effect on each given
effective date. (See Examples 5 and 6.)
(10) Canceled Sheets. When filing to cancel a rate schedule,
file one sheet with a new revision number and the sheet number of
the first canceled sheet. Designate as superseded ``Sheet Nos. ____-
____'' where the blanks refer to the first and last canceled sheet
numbers in a series. The specific pagination of each individual
canceled sheet should be included in the body of the tariff sheet.
When using the formerly canceled sheet numbers, refer to the
pagination of the sheets listed in the body of the canceling sheet,
and paginate each sheet with the next higher revision number. See
Example 8.
(11) Sheets Reserved For Future Use. When reserving a number of
sheets for future use, file one sheet paginated ``Sheet Nos. ____-
____'', where the blanks refer to the first and last reserved sheet
numbers in series. In the body of the sheet state ``Reserved for
Future Use.'' (See Example 9.) Note: in the electronic tariff sheet
records, report the first sheet number in the series in the ``Sheet
No.'' field and the full pagination in the ``Sheet ID'' field.
(12) Abbreviations. Pagination cannot exceed 40 characters.
Abbreviate from left to right using the Abbreviation Conventions List
in Exhibit C. Abbreviate only as needed to reduce the pagination to 40
characters or less. (See Example 7.) Electronic and paper versions of a
tariff sheet must be paginated exactly alike, including abbreviations.
BILLING CODE 6717-01-P
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[FR Doc. 96-5165 Filed 3-8-96; 8:45 am]
BILLING CODE 6717-01-C
