03-12949. Revisions to Oil Pipeline Regulations Pursuant to the Energy Policy Act of 1992; Notice of Annual Change in the Producer Price Index for Finished Goods

May 19, 2003.

The Commission's regulations include a methodology for oil pipelines to change their rates through use of an index system that establishes ceiling levels for such rates. The index system as set forth at 18 CFR 342.3 is based on the annual change in the Producer Price Index for Finished Goods (PPI-FG). 19 CFR 342.3(d)(2) provides that the oil pricing index to be used is PPI-FG minus 1 percent. However, on February 24, 2003, the Commission issued an Order on Remand of its Five-Year Review of Oil Pricing Index in Docket Nos. RM00-11-000 and -001 which determined that the appropriate oil pricing index should be PPI without the minus 1 per cent adjustment.^[1] The regulations provide that each year the Commission will publish an index reflecting the final change in the PPI-FG, after the final PPI-FG is made available by the Bureau of Labor Statistics in May of each calendar year.

The annual average PPI-FG index figure for 2001 was 140.7 and the annual average PPI-FG index figure for 2002 was 138.9.^[2] Thus, the percent change (expressed as a decimal) in the annual average PPI-FG from 2001 to 2002 is negative 0.012793.^[3] Oil pipelines must multiply their July 1, 2002—June 30, 2003, index ceiling levels by negative 0.987207^[4] to compute their index ceiling levels for the period July 1, 2003, through June 30, 2004, in accordance with 18 CFR 342.3(d). For guidance in calculating the ceiling levels for each period beginning January 1, l995,^[5] see Explorer Pipeline Company, 71 FERC 61,416 at n.6 (1995).

Document Availability

In addition to publishing the full text of this document in the Federal Register, the Commission provides all interested persons an opportunity to view or print the contents of this document via the Internet through FERC's home page (http://www.ferc.gov) and in FERC's Public Reference Room during normal business hours (8:30 a.m. to 5 p.m. eastern time) at 888 First Street, NE., Room 2A, Washington, DC 20426.

From FERC's home page on the Internet, this information is available in the Federal Energy Regulatory Records Information System (FERRIS). The full text of this document is available on FERRIS in PDF and WordPerfect format for viewing, printing, or downloading. To access this document in FERRIS, type the docket number excluding the last three digits of this document in the docket number field.

This document is available for review at the Commission or may be viewed on the Commission's Web site at http://www.ferc.gov, using the “FERRIS” link. Enter the docket number excluding the last three digits in the docket number field to access the document. For assistance, contact FERC Online Support at [e-mail] or toll-free at [phone], or for TTY, contact [phone].

Magalie R. Salas,

Secretary.

Footnotes

1.  102 FERC ¶ 61,195 at P 1 (2003).

2.  The final figure for the annual average PPI-FG is published by the Bureau of Labor Statistics (BLS) in mid-May of each year. This figure is publicly available from the Division of Industrial Prices and Price Indexes of the BLS, at [phone], and in print in August in Table 1 of the annual data supplement to the BLS publication Producer Price Indexes via the Internet at http://www.bls.gov/​ppi. To obtain the BLS data, click on Get Detailed Statistics, then click on Commodity Data under the Most Requested Statistics heading. At the next screen, Producer Price Index—Commodity, select the first box, Finished goods—WPUSOP3000, then scroll all the way to the bottom of this screen and click on Retrieve data.

3.  [138.9—140.7] / 140.7 =—0.012793

4.  1 + (-0.012793) =—0.987207

5.  For a listing of all prior multipliers issued by the Commission, see the Commission's website, http://www.ferc.gov. The table of multipliers can be found under the headings “Oil” and “Index”.