[Federal Register Volume 60, Number 156 (Monday, August 14, 1995)]
[Rules and Regulations]
[Pages 41821-41828]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-20021]
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DEPARTMENT OF TRANSPORTATION
Research and Special Programs Administration
49 CFR Part 192
[Docket PS-135; Amdt. 192-3]
RIN 2137-AC32
Customer-Owned Service Lines
AGENCY: Research and Special Programs Administration (RSPA), DOT.
ACTION: Final rule.
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SUMMARY: This action requires operators of gas service lines who do not
maintain buried customer piping up to building walls or certain other
locations to notify their customers of the need to maintain that
piping. Congress directed DOT to take this action in view of service
line accidents. By advising customers of the need to maintain their
buried gas piping, the notices may reduce the risk of further
accidents.
EFFECTIVE DATE: September 13, 1995.
FOR FURTHER INFORMATION CONTACT: L. M. Furrow, (202) 366-2392,
regarding the content of this document, or the Dockets Unit (202) 366-
4453 for copies of this final rule or other material in the docket.
SUPPLEMENTARY INFORMATION:
I. Background
A. Customer Piping
RSPA's gas pipeline safety standards (49 CFR Part 192) apply to the
distribution of gas up to the end of a pipeline operator's service
line. A service line, as defined in Sec. 192.3, is a distribution line
that begins at a common source of supply, usually a main, transmission
line, or gathering line. The end of a service line is a customer meter
or a connection to a customer's piping, whichever is farther
downstream. If there is no meter, the connection to a customer's piping
marks the end of a service line. A customer is any person who contracts
with an operator to receive gas for consumption. Customer's piping (or
customer piping) refers to piping not owned by an operator through
which a customer receives gas.
When operators install customer meters, they usually install them
outdoors next to the building that houses the customer's principal gas
utilization equipment. If that equipment is not inside a building, the
meter may be installed next to the equipment. Either of these
installations may leave only a short segment of exterior customer
piping between the end of the operator's service line and the building
or equipment. Sometimes, however, operators install customer meters
farther away from buildings or equipment, perhaps at a private property
line or fence. The result is a much longer length of exterior customer
piping.
Regardless of length, customer piping downstream from an operator's
service line is not subject to the maintenance standards of Part 192.
However, according to the National Transportation Safety Board, twenty-
two states now require operators to monitor portions of customer
piping. Also, many operators voluntarily maintain customer piping up to
building walls. Still, for much customer piping, maintenance is the
responsibility of customers or piping owners, not operators of service
lines. In this regard, RSPA is preparing a report on the safety of
customer piping located downstream from service lines to see if there
is a need for further legislative or regulatory action. The report is
required by section 115(b) of the Pipeline Safety Act of 1992 (Pub. L.
102-508; 106 Stat. 3296).
B. Statutory Mandate
During a 7-month period beginning September 16, 1988, a series of
five service line accidents killed four people and injured 16 others in
Kansas and Missouri. The accidents happened on service lines supplying
gas to homes and were due to corrosion and other causes. As a result,
Congress became concerned about the safety of gas piping leading up to
buildings. Congress felt that customers of distribution pipeline
operators may not understand the need for basic maintenance of customer
piping.
Therefore, as provided by 49 U.S.C. Sec. 60113(a) (formerly section
18(b) of the
[[Page 41822]]
Natural Gas Pipeline Safety Act of 1968), Congress directed DOT to--
Prescribe regulations requiring an operator of a natural gas
distribution pipeline that does not maintain customer-owned natural
gas service lines up to the building walls to advise its customers
of--
(1) the requirements for maintaining those lines;
(2) any resources known to the operator that could assist
customers in carrying out the maintenance;
(3) information the operator has on operating and maintaining
its lines that could assist customers; and
(4) the potential hazards of not maintaining the lines.
C. Rulemaking Proposal
In response to this Congressional mandate, RSPA published a notice
of proposed rulemaking (NPRM)(59 FR 5168; February 3, 1994) on customer
notification. The NPRM proposed to define the piping covered by the
mandate (``covered piping''). The NPRM also proposed to establish the
details of advice that operators who do not maintain covered piping up
to building walls would have to give their customers.
In a supplemental notice of proposed rulemaking (SNPRM)(59 FR
13300; March 21, 1994), RSPA expanded the proposed rules to cover
certain exterior customer piping that is above ground. The SNPRM also
clarified that the proposed rules were not limited to operators who are
local distribution companies. Other operators (primarily transmission
companies) that supply gas to customers through service lines were
covered as well. RSPA also announced in the SNPRM that the proposed
rules did not apply to customer piping that branches from a customer's
primary gas supply line to supply gas to secondary equipment, such as
pool heaters and yard lanterns.
D. Advisory Committee Review
RSPA presented the NPRM and SNPRM for deliberation by the Technical
Pipeline Safety Standards Committee (TPSSC) at a meeting in Washington,
D.C. on May 11, 1994. TPSSC is RSPA's statutory advisory committee for
gas pipeline safety. The committee comprises 15 members, representing
industry, government, and the public, who are technically qualified to
evaluate gas pipeline safety. TPSSC's report of its deliberation is
available in the docket of this proceeding.
TPSSC voted unanimously to find the proposed rules technically
feasible, reasonable, and practicable, provided RSPA made the following
changes: (1) delete information on age, location, and material of
customer piping from proposed Sec. 192.16(a)(4); (2) when customer
piping does not enter a building, end covered piping at the point of
custody transfer; (3) apply the proposed rule only to buried
residential and small-commercial lines; and (4) delete ``transmission
or'' from proposed Sec. 192.16(a) to limit the rule to distribution
operators. The next section discusses how we handled TPSSC's
recommended changes in developing the final rule.
II. Discussion of Comments and TPSSC Recommendations
A. Commenters
We received written comments from 57 persons in response to the
NPRM and SNPRM. The comments came from: 47 pipeline operators; 5 state
pipeline safety agencies (Maryland, Kansas, Iowa, Michigan, and
Missouri); 4 trade associations (American Gas Association (AGA),
Interstate Natural Gas Association of America (INGAA), Western
Mobilehome Parkowners Association (WMPA), and Texas Gas Association
(TGA)); and 1 federal agency (National Transportation Safety Board
(NTSB)).
Most commenters directed their remarks to specific issues. This
section of the preamble discusses our resolution of significant issues
in light of comments and TPSSC recommendations.
B. The Term ``Customer-Owned Service Line''
The mandate applied to customer piping Congress called ``customer-
owned service lines.'' So the NPRM and SNPRM used this term to
designate the customer piping covered by the proposed rules.
Despite its statutory origin, many commenters felt the term
``customer-owned service line'' would be confusing in a Part 192
regulation. They said many service lines under Part 192 include piping
owned by customers. Consequently, they argued the term was too similar
to ``service line'' to distinguish customer piping not regulated by
Part 192 from service lines regulated by Part 192. The commenters
suggested as alternatives the names ``supply pipe,'' ``yard line,''
``fuel line,'' and ``customer-owned piping.''
We agree that ``customer-owned service line'' would be a misnomer
in Part 192. The term could easily be confused with ``service line,''
because some customers own the portion of a service line on private
property between a distribution main and customer meter. Also, other
customers (particularly tenants) may not own any of the piping through
which they receive gas from an operator. For these reasons, we did not
use the term ``customer-owned service line'' in the final rule.
At the same time, we did not name covered piping as commenters
suggested. Since Part 192 currently refers to piping beyond the end of
a service line as ``customer's piping'' (see Sec. 192.3, service line),
referring to that piping by another name would be confusing. Instead,
to designate piping covered by the final rule, we used ``customer's
piping'' with other descriptive wording (Sec. 192.16(a)).
C. End of Covered Piping
To delineate the customer piping covered by the proposed rules, the
NPRM and SNPRM defined the term ``customer-owned service line.'' The
definition proposed was: ``a pipeline that transports natural gas or
petroleum gas from a service line to (1) an exterior wall of a
building, or (2) end-use equipment'' (proposed amendment to
Sec. 192.3).
Most commenters thought the proposed end of covered piping was
unclear. One concern was the end of covered piping when customer piping
leads to more than one building. Another concern was the end when
customer piping leads both to a building and to outdoor equipment, such
as a lantern. Still another concern was the end when customer piping
does not enter a building, which happens at some plants. In regard to
plants, AGA argued the end should be at a location equivalent to a
building wall, such as the plant fence or point of custody transfer.
Similarly, TPSSC recommended ending covered piping at a custody
transfer point when there is no building.
As stated above, we intended the proposed rules to apply to
customers' primary gas supply lines. Branch lines that serve pool
heaters, yard lanterns, or other types of secondary equipment were not
intended to be covered. The final rule (Sec. 192.16(a)) clarifies this
point by covering customer piping up to gas utilization equipment only
when the customer's piping does not enter a building. Also, to avoid
the confusion of where covered piping ends when customer piping enters
more than one building, the final rule refers to the first building. We
used the term ``gas utilization equipment'' instead of ``end-use
equipment'' for consistency with present terminology in Part 192 (e.g.,
Sec. 192.197(a)(5)).
When customer piping does not enter a building, we agree that a
perimeter fence (or wall) surrounding the gas utilization equipment
serves the
[[Page 41823]]
purpose of a building wall under the mandate. Thus, when there is no
building, under the final rule, covered piping ends at the gas
utilization equipment or at the intersection of the first fence (or
wall) that encloses the equipment (if such a fence (or wall) exists).
The fence (or wall) may surround the plant, part of the plant, or just
the equipment.
We did not adopt custody transfer to demarcate the end of covered
piping when customer piping does not enter a building. Because custody
transfer arguably occurs when gas enters piping not owned by the
operator, none of the customer piping downstream from a service line
would come under the notification rule.
D. Aboveground Customer Piping and Short Sections of Piping Between
Meters and Buildings
Many commenters, including AGA and Missouri, recommended that the
final rule apply only to buried piping. Generally, the commenters felt
that aboveground piping presents less risk than buried piping. The
commenters said operators or customers would see any deteriorated
piping or they would smell any leaks. Further, the commenters
envisioned that any leaks would go directly to the atmosphere and not
migrate into a building. TPSSC also recommended that we limit the final
rule to buried piping.
The chief reason, however, that most commenters wanted to restrict
the final rule to buried piping was to reduce the number of customers
that would have to be notified. This point was emphasized by AGA at the
TPSSC meeting, convincing TPSSC to overturn an earlier vote against
excluding aboveground piping. Millions of additional customers would
have to be notified if aboveground piping were covered, since most
service lines, including lines that end at meters next to buildings,
connect to short sections of aboveground piping. For example, one
operator said it would have to send 1.3 million notices if the rule
covered aboveground piping, compared with 68,000 notices if only buried
piping were covered. This operator argued that since the accidents that
produced the mandate all involved buried piping, Congress did not
intend the mandate to cover aboveground piping. In addition, according
to WMPA, if the rule covered aboveground short sections of piping, it
would affect most of the 2,950 mobilehome parks in California with
master meter systems. WMPA said mobilehomes in these parks are usually
connected to gas meters by short flexible pipe that is the
responsibility of the mobilehome owner. WMPA recommended that the final
rule not apply to aboveground piping less than 6 feet long.
We too were concerned about the impact of the proposed rules on
short sections of piping between customer meters and buildings. So, in
the NPRM and SNPRM, we asked for public comment on whether these short
sections of piping are properly installed and periodically maintained.
One operator commented that trained operator or heating contractor
personnel install the short sections. Another operator said
installation is done according to the National Fuel Gas Code, interior
gas piping standards produced by the American National Standards
Institute and the National Fire Protection Association. Several
operators said that short sections seldom or never leak. A few
operators reported they periodically inspect short sections for leaks
and advise customers of any problems. However, one operator said it
does not check commercial or industrial piping. Two other operators
said they check for leaks when they turn gas on or when they receive
leak reports. WMPA commented that leak surveys normally include the
customer's connector pipe, and that mobilehome owners are advised of
any needed repairs.
These comments and the TPSSC recommendation convinced us that
aboveground customer piping should not be regarded as covered piping.
First of all, we recognize that if aboveground piping were covered,
almost every gas customer in the U.S. would have to be notified. And
there is no evidence that a notification program of this magnitude
would result in a comparable increase in public safety. Nor do we think
Congress contemplated a huge, nationwide notification program. Although
the mandate arguably applies to any customer piping up to building
walls, the fact that the accidents that led to the mandate happened on
buried service lines means it is reasonable to conclude that Congress
intended the mandate to cover only buried customer piping. This
conclusion is congruous with the risks involved, because as the
comments indicate, aboveground customer piping poses much less risk
than buried customer piping. Therefore, the final rule applies only to
buried piping (Sec. 192.16(a)). As a result, short sections of customer
piping between customer meters and building walls that are entirely
aboveground are not covered by the final rule.
E. Farm Taps and Industrial Taps
The proposed rules applied to customers served by ``farm taps'' or
``industrial taps.'' Farm tap is industry jargon for a pipeline that
branches from a transmission or gathering line to deliver gas to a
farmer or other landowner. Similarly, an industrial tap is a pipeline
that branches from a transmission or gathering line to deliver gas to
an industrial plant. So companies primarily engaged in the transmission
or gathering of gas operate most farm taps and industrial taps.
About a third of commenters argued against this proposal, saying
that Congress intended the mandate to apply only to local distribution
companies. In support, they pointed out that residential accidents
prompted the mandate. They also said that customers served by farm and
industrial taps are more likely than residential customers to be
familiar with the need to maintain gas piping. In this regard, a gas
production company said its lease agreements with farm tap customers
make them aware of their responsibility for maintenance. TPSSC also
recommended that we limit the final rule to distribution operators and
to residential and small commercial customers.
We do not believe these arguments and TPSSC recommendations justify
excluding farm tap and industrial tap customers from the final rule. To
begin with, while we recognize that Congress was primarily concerned
about residential customers, the mandate is not so limited. Congress
applied the mandate to ``operators of natural gas distribution
pipelines.'' But these operators are not just local distribution
companies as the commenters suggested. Some operators primarily engaged
in the gathering or transmission of gas also operate distribution
pipelines. They do so when they deliver gas directly to customers
through farm taps and industrial taps. In fact, because portions of
these delivery lines qualify as service lines, gathering and
transmission operators report them as distribution pipelines under 49
CFR 191.13. Moreover, farm and industrial tap customers are not immune
from harm by potential hazards that could occur on their piping. And
surely not all farm and industrial tap customers know enough about gas
piping safety to make even a single maintenance notice unnecessary.
Therefore, application of the final rule does not depend on the
nature of an operator's primary business. To clarify this point, we
reworded the final rule (Sec. 192.16(a)) so that it applies to
operators of service lines, instead of transmission or distribution
operators as proposed. Although this change made it unnecessary to
define ``farm tap'' or
[[Page 41824]]
``industrial tap,'' operators of these taps are not excepted from the
final rule.
We recognize that local distribution companies operate some metered
farm taps on transmission lines. In these cases, the local distribution
company is responsible for compliance with the final rule.
F. Meaning of ``Maintain''
The mandate applies to operators who do not ``maintain'' customer
piping up to building walls. What Congress meant by ``maintain'' is
important, because operators who maintain customer piping up to
building walls need not advise customers of the need for maintenance.
Because ``maintain'' is inexact, the NPRM and SNPRM proposed to clarify
the mandate by giving ``maintain'' a particular meaning: ``maintain * *
* to Part 192 standards'' (proposed Sec. 192.16(a)).
Commenters thought the standards in Part 192 were not an
appropriate gauge of whether an operator maintains covered piping as
Congress had in mind. One operator put it this way: while it may be
reasonable to conduct a leakage survey every 3 years (under
Sec. 192.723) up to the nearest building wall and, if a leak is
detected, shut off the flow of gas, it would not be reasonable to
maintain a customer's piping to meet all Part 192 maintenance
standards. Another operator thought the proposal was unreasonable
because it would require operators to send notices to customers even if
operators maintain covered piping according to State requirements, but
not to Part 192.
RSPA agrees that operators would have difficulty meeting Part 192
maintenance standards on covered piping. Operators may lack permission
from property owners to take maintenance action or lack the necessary
information upon which to base maintenance action. For example, under
Sec. 192.725, each disconnected service line must be pressure tested as
a new line. Yet operators probably would need access to the customer's
building and other permission from the customer or property owner to do
this test on a customer's piping. Another example is Sec. 192.455(a),
which provides that each buried pipeline installed after July 31, 1971,
must be protected against external corrosion. This regulation presumes
operators know the installation date of their pipelines, a fact they
may not know for a customer's piping.
Upon further consideration, we are defining ``maintain'' to mean
whatever maintenance is reasonable for operators to do on covered
piping, considering the Congressional intent. Although the legislative
history casts little light on what Congress meant by ``maintain,'' it
does show that Congress was concerned about corrosion-related accidents
on service lines.
Preventing and correcting hazardous leaks are the major safety
reasons to maintain gas pipelines. The comments show that many
operators already check customer piping between customer meters and
building walls for leaks. Some operators may check for leaks while
doing routine leakage surveys on their own pipelines under
Sec. 192.723. If a leak is found, depending on the nature of the leak,
they either shut off the flow of gas or warn the customer to repair the
leak.
Besides leakage checks, another reasonable maintenance activity is
to monitor customer piping for corrosion, a major cause of leaks on
metallic pipelines. More specifically, operators must periodically
monitor their buried metallic service lines for external corrosion
under Sec. 192.465. With permission from the land owner or tenant,
operators could also monitor covered piping according to this standard.
However, rather than take the specified remedial action, which might be
difficult to do on covered piping, they could shut off the flow of gas
or warn the customer to repair any harmful corrosion found.
Considering the reasons for maintenance, Congress's concern about
corrosion, present industry practices, and commenters' advice, we
believe ``maintain'' means periodic checking for leaks and corrosion,
with appropriate follow-up action. Thus, the final rule
(Sec. 192.16(a)) provides that operators who do not maintain covered
piping according to Sec. 192.465 (if applicable) and Sec. 192.723, with
appropriate remedial action, must send the customer a maintenance
notice.
In accordance with Executive Order 12898 on Environmental Justice,
we have considered the potential effect of this final rule on minority
and low income customers. Because the rule applies only to gas
operators who do not inspect certain customer piping, the rule will not
impose direct costs on gas customers. However, some customers may incur
indirect costs of the rule. Customers who own exterior gas piping and
decide to heed the gas company's maintenance advice could face large
repair bills, depending on the condition and amount of their piping.
Indirect costs can also arise when operators who inspect customer-owned
piping discover that it is leaking or otherwise unsafe and require
customers to repair the piping if gas service is to continue.
We cannot predict which customers would be likely to incur these
indirect costs. However, the proportion of minority and low income
customers that might incur them should be small, because most minority
and low income gas customers are tenants. As tenants, they can
reasonably be expected to refer the matter of piping maintenance or
unsafe piping to their landlords, who are responsible for corrective
action.
When minority and low income customers must bear the indirect costs
themselves, voluntary organizations and local welfare agencies can
reasonably be expected to provide assistance, especially in response to
gas shut off situations if the health of customers is affected. In
addition, we expect that states adopting this final rule will monitor
its effect on minority and low income gas customers and find additional
ways to lessen the indirect cost burden. For example, states may
require operators to stand the cost of maintenance or establish a fund
to pay for maintenance that minority and low-income customers cannot
afford.
Despite the potentially low impact of this final rule on minority
and low income customers as a whole and efforts to defray indirect
costs, the cost of piping maintenance will unavoidably be a hardship
for some minority and low income customers. Still, in view of the high
safety risk of deteriorating residential gas piping and Congress's
mandate that operators warn customers about this potential problem, we
see no federal regulatory alternative that would lessen the potential
cost burden. We will, however, examine this issue further in the report
to Congress on the safety of customer-owned service lines that is
required by section 115(b) of the Pipeline Safety Act of 1992 (Public
Law 102-508, 106 Stat. 3296).
G. Customer Responsibility
The NPRM and SNPRM proposed that operators who do not maintain
covered piping must notify the customer that ``the customer owns and is
responsible for the maintenance of the customer-owned service line''
(proposed Sec. 192.16(a)(1)). The purpose of this proposal was to alert
customers that the operator does not maintain the customer's piping.
AGA and several operators pointed out that customers who occupy
rental properties, especially commercial buildings, may not own the
piping through which they receive gas. Other commenters observed that
operators may not know who owns the customer's piping. One solution a
commenter suggested was that the notice advise
[[Page 41825]]
rental customers to refer the maintenance advice to the landlord.
Another consideration, not raised by commenters, is that many
states now require operators to do some maintenance on customer piping.
In these states, it would be incorrect for operators to notify
customers that the customers or their landlords are responsible for
maintenance of customer piping.
Thus, it appears the proposal could be confusing or incorrect in
some circumstances if included in maintenance notices. To avoid this
confusion, the final rule (Sec. 192.16(b)(1)) merely requires operators
to notify customers that the operator does not maintain the customer's
piping.
Some operators may do a level of maintenance on customer piping
(either voluntarily or under State law) that does not reach the minimum
level prescribed by the final rule. If these operators wish to avoid
advising customers that they do not maintain customer piping, they
would have to increase their maintenance to the minimum level.
H. Requirements for Maintenance
Under the mandate, operators who do not maintain covered piping
must advise their customers of the requirements for maintenance of that
piping. To carry out this feature of the mandate, the NPRM and SNPRM
proposed that operators notify customers ``of the essential elements
for proper maintenance * * * such as those listed in subpart M of [Part
192] or those listed in applicable local building codes'' (proposed
Sec. 192.16(a)(2)).
Many commenters, including Iowa, Michigan, AGA, and TGA,
recommended that the final rule not refer to Part 192 or local codes as
examples of the essential elements of maintenance. The objection
expressed most often was that Subpart M of Part 192 is not appropriate
for customer piping downstream from meters; it was written for
operators, not customers. Commenters also said the proposed rule was
indefinite about which sections in Subpart M to apply to customer
piping. Several commenters said that Subpart M and the local codes may
conflict with each other, forcing operators to choose which standard is
appropriate for customers to follow. One commenter stated it would be
unreasonable to require operators to learn the essential elements of
local building codes applicable to maintenance of customer piping and
then send that information to each customer. For example, one large
distribution company said it would be especially burdensome to examine
the details of local codes in the 535 cities, towns, and communities it
serves, and to continually keep abreast of them.
Alternatively, INGAA and an operator suggested that the final rule
specify the maintenance advice operators are to give customers, instead
of leaving it to the operator's discretion. INGAA said this approach
would minimize the potential liability for giving inappropriate advice.
The operator said it would reduce the confusion of different operators
giving different advice to similar customers. Two operators thought we
should limit the maintenance advice to periodic leakage surveys. Also,
two other operators advised us to mention corrosion control as an
example of essential maintenance.
We believe Congress used the word ``requirements'' in the sense of
actions that are necessary for maintenance, rather than required by law
for maintenance. So we proposed that operators use local codes, Subpart
M of Part 192, or other sources as a guide to identify essential
elements of maintenance. Although many commenters interpreted the
proposal to the contrary, we did not intend for operators to keep
abreast of local code requirements applicable to maintenance of
customer piping. Nor did we intend for notifications to bring customers
up to date about their obligations under local law.
We recognize, though, that the proposed rules gave operators wide
latitude to decide what maintenance advice to provide customers. We
also recognize that confusion could result if operators gave different
advice in similar situations. So we adopted the suggestion to specify
essential maintenance advice. We based the specified maintenance advice
on the recommendations of commenters and the decision discussed above
on the meaning of ``maintain.'' Since the specified maintenance advice
is commonly found in pipeline safety programs, we doubt it conflicts
with local codes.
Consequently, the final rule (Sec. 192.16(b)(3)(i)-(iii)) does not
require notice of any provisions of Subpart M of Part 192 or of any
local code requirements. It simply requires operators to notify
customers that their buried gas piping should be periodically inspected
for leaks; periodically inspected for corrosion, if the piping is
metallic; and repaired if any unsafe condition is found. By referring
to buried piping, the notice will encourage customers to apply the
advice to any buried piping they may have besides their primary supply
line.
I. Maintenance Assistance
The mandate requires that operators advise customers of any
resources known to the operator that could assist customers in carrying
out maintenance. In response, we proposed that operators notify
customers ``of available resources that could aid the customer in
obtaining maintenance assistance, such as the gas pipeline operator,
the state licensing board for plumbers and state plumbers'
associations, Federal and state gas pipeline safety organizations, the
local building code agencies, and appropriate leak detection, gas
utility, and corrosion protection contractors'' (proposed
Sec. 192.16(a)(3)).
Many commenters said it would be too burdensome to maintain current
lists of agencies, associations, and contractors over wide areas. They
said customers could easily find maintenance assistance by consulting
the local better business bureau or chamber of commerce. A few
commenters were concerned the proposed rule would cause suits to be
filed against the operator for unfair competition if notices omitted
appropriate contractors, or for negligence if recommended contractors
caused injuries or did unsatisfactory work. One commenter thought the
proposed rule was unfair because it would force operators to refer
customers to businesses that compete with the operators to provide
maintenance services on gas piping.
In view of these comments, we decided to require operators to give
only general advice about maintenance assistance. Operators need not
maintain lists of specific contractors that might do maintenance work
on customer piping. Although government agencies probably could advise
customers about State or local laws, this advice probably would not be
helpful in carrying out maintenance. Instead of advising inquirers
about the details of maintenance, agencies and associations probably
would refer them to contractors. Since customers can learn the names of
contractors through the yellow pages or local chambers of commerce, the
final rule does not require notice of specific contractors, agencies,
or associations. The rule (Sec. 192.16(b)(5)) simply requires notice
that the operator (if applicable), plumbers, and heating contractors
may be contacted for assistance in maintaining and locating the
customer's piping. Under this rule, if an operator does not offer such
assistance, it would not have to mention itself as a possible source of
assistance. At the same time, an operator may not mention only itself
[[Page 41826]]
as a source of assistance on customer piping.
J. Other Helpful Information
1. General
The mandate requires that operators provide information the
operator has on operating and maintaining its lines that could assist
customers. In turn, we proposed that operators notify customers of
``any information that the operator has concerning the operation and
maintenance of the customer-owned service line that could aid the
customer, such as information on excavation damage prevention, local
codes and standards (when applicable), and the age, location, and
material of the customer-owned service line'' (proposed
Sec. 192.16(a)(4)).
2. Age, Location, and Material
TPSSC and about a third of commenters urged us not to require
operators to provide information about the age, location, and material
of customer piping. Several commenters said that because the
information was site specific, operators could not use a notice
generally applicable to all customers, as contemplated in the NPRM.
Others said operators typically do not have the proposed information
about customer piping, and it would be an undue burden to get it. A
number of commenters also pointed out that the age of customer piping
may not correspond to the date the operator established gas service,
because the customer may have replaced or altered the piping since that
date.
We agree that operators may not have the proposed information about
customer piping, since they are not required by Part 192 to maintain
the piping. Also, obtaining the information would be a significant
burden that Congress did not intend operators to assume. The mandate
requires operators to give customers helpful information based on the
operation and maintenance of the operator's pipelines. The mandate does
not require operators to gather information about customer piping. Even
when operators do have some information about customer piping,
requiring them to add the information to notices might not allow the
operators to use a general notice to meet the notification rule.
Therefore, this final rule does not require operators to notify
customers of the age, location, and material of customer piping.
As a result, operators may send each customer a notice on the
proper maintenance of customer piping in general. Notices need not be
tailored to meet specific customer situations. However, operators who
have specific information about customer piping and wish to include it
in notices are encouraged to do so.
3. Local Laws
For reasons discussed above concerning proposed Sec. 192.16(a)(2),
several commenters suggested that the final rule not make operators
responsible for advising customers about local laws. Since local
building codes would be burdensome for operators to track, are the
responsibility of local agencies to enforce, and are unlikely to
contain instructions on how to carry out piping maintenance, the final
rule does not require notice of local laws.
4. Excavation Damage Prevention
Two operators asked us to clarify the information they would have
to provide about excavation damage. They suggested the notice stress
the need to locate piping before excavating and to dig with care.
We agree that this information would be helpful to customers,
because of the large number of gas pipeline accidents attributable to
excavation damage. The final rule (Sec. 192.16(b)(4)) reflects these
comments. However, operators are not required to notify customers to
contact ``one-call'' systems to learn the location of buried customer
piping before excavating. One-call systems provide such service only
for piping of companies that are members of the system. One-call
systems generally have no information regarding customer piping.
Apart from the maintenance requirements discussed above,
information about preventing excavation damage is probably the most
significant information operators have about operating and maintaining
their own pipelines that would be helpful to customers. In the interest
of producing a general notice limited to basic advice, the final rule
does not require notice of any other information related to operation
and maintenance of the operator's pipelines. However, operators may
supplement the required information as they deem appropriate.
K. Potential Hazards
The mandate requires that operators notify customers about the
potential hazards of not maintaining customer piping. As proposed in
the NPRM and SNPRM, operators would have to advise customers of ``the
potential hazards of not maintaining the customer-owned service line,
such as corrosion and gas leakage'' (proposed Sec. 192.16(a)(5)).
Only a few commenters addressed this proposal. Two commenters
thought it would be unfair if operators had to warn their customers
that gas piping can be hazardous, while their competitors, fuel oil and
electric companies, do not have to give a similar warning. One
commenter said that sending notices about potential hazards would not
be compatible with the goal of market expansion. Another commenter
requested that in the final rule, we insert ``reasonably foreseeable''
before ``potential hazard.''
Although we do not have discretion under the mandate not to require
notice of potential hazards, we did not find the arguments against such
notice persuasive. The risks involved in using fuel oil and electricity
have not demanded the same level of public attention as gas pipeline
risks. So, from a public policy standpoint, it is not unfair if only
gas pipeline operators must warn their customers of risks. Also, we do
not agree that warning customers of potential hazards is incompatible
with business expansion. Part 192 already requires operators to post
signs over their pipelines warning of potential danger (Sec. 192.707),
and to educate the public to recognize gas pipeline emergencies
(Sec. 192.615). These programs and the abundant advertisements about
using ``one call'' systems to guard against the hazards of excavation
damage have, to our knowledge, not adversely affected the growth of
business. Indeed, we believe people prefer to do business with socially
responsible companies that do not hesitate to publicize information
that could help prevent accidents. Finally, to qualify ``potential
hazard'' the way one commenter suggested would not enhance the clarity
of the final rule.
The proposal concerning notice of potential hazards is adopted in
this final rule as Sec. 192.16(b)(2)--the second item in the list of
information to be provided, rather than the last item, as proposed.
This rearrangement encourages operators to warn customers of potential
hazards at the beginning of notices instead of at the end. A notice may
mention just two potential hazards: corrosion and leaks. Most
commenters referred to these potential hazards in response to the
proposal, and service line accidents generally involve these hazards.
L. Frequency and Time of Notification
1. General
The mandate does not specify how often operators must give their
customers maintenance advice or when
[[Page 41827]]
they must give them the advice. To clarify these points, we proposed
that operators notify existing customers within 6 months after
publication of the final rule, and new customers within that time or
within 30 days after the service line is placed in service, whichever
is later (proposed Sec. 192.16(b)).
2. Number of Notices
Several commenters thought the final rule should clearly state
whether operators must notify a customer more than once. Other
commenters, including NTSB, felt a single notice to each customer would
not be sufficient. They recommended that operators send notices
annually (to refresh customer memory), every 2 years, every 5 years, or
occasionally.
A single notice sent to each present and future customer would
satisfy the mandate. None of the advocates for more frequent
notification showed that additional notices would significantly improve
safety. Furthermore, the cost of periodic notices would be high, and
the effect of customer notification on accident prevention is
uncertain. There is also an absence of accumulated accident data on
customer piping from which to project the benefits of sending multiple
notices to the same customers. Consequently, the final rule expressly
states that operators must notify each customer only once.
3. New Customers
Three commenters said the proposed rule was unclear whether ``new
customers'' meant new customers on new service lines or new customers
on existing service lines. A few operators said it would be a
tremendous burden to notify every new customer on an existing service
line because of the large changeover in customers. One operator said it
has over 100,000 of such new customers annually. These operators would
prefer to notify only the first customer on a new service line or to
send notices to all customers periodically.
For the mandate to have a continuing effect on customer safety,
each present and future customer must receive a maintenance notice if
the operator does not maintain covered piping. There would be no
continuing effect if operators were to notify just existing customers
and the first customers on new service lines. As these customers leave,
their successors might lack necessary maintenance information, and the
safety of customer piping might decline. So the final rule applies to
all new customers. Operators can mitigate the burden of notifying large
numbers of customers by inserting general notices in billing envelopes.
To avoid confusion, the final rule does not distinguish new
customers from existing customers. Instead, the rule (Sec. 192.16(c))
requires operators to notify each customer by a certain date, as
discussed next.
4. Time of Notification
AGA and several operators recommended a compliance time of 1 year
to notify existing customers, instead of 6 months as proposed. They
argued that operators would need more time to learn which customers to
notify, to draft and send notices, and to instruct personnel to handle
inquiries. These commenters also said more time would ease the burden
on staff by allowing operators to spread notifications over a longer
period.
For new customers, one operator advised that sending notices within
30 days after the customer's service begins would not fit the company's
billing cycle. AGA and INGAA suggested an appropriate time to notify
new customers would be the time of first billing, rather than when a
service line is placed in service.
We proposed a 6-month compliance period to notify existing
customers based primarily on our estimate of the time needed to prepare
and send out notices. However, in view of the additional information
commenters provided, 1 year now seems more appropriate. Further,
because service lines are often left in service during customer
changeover, the suggestion to notify new customers upon first billing
seems reasonable. However, some operators may not choose billing as the
method of notification. And, as one commenter remarked, many farm tap
customers who receive gas under a right-of-way agreement are not
billed. Considering the variations among billing cycles and the
alternative means of distributing notices, we believe 90 days after
first receipt of gas at a particular location would be a reasonable
deadline by which to notify new customers. Therefore, the final rule
requires operators to notify each customer not later than 1 year from
today or 90 days after the customer first receives gas at a particular
location, whichever is later (Sec. 192.16(c)).
M. Records
The mandate does not require that operators keep records of the
advice they give customers. However, as a way to check compliance, we
proposed that ``each operator must keep a record of the written
notifications'' (proposed Sec. 192.16(c)).
AGA and several operators said the type of record and the retention
time were unclear under the proposed rule. Maryland suggested that to
see if operators have notified customers, inspectors would have to
inspect a record of the date a notice was sent, the name of the
customer, and a copy of the notice. In contrast, several operators
thought keeping a list of notified customers and the dates they were
notified would be too burdensome. Three operators suggested the final
rule just require maintenance of a copy of the notice being sent to
customers.
To check compliance, RSPA and State inspectors will need to view a
copy of the notice operators send customers and evidence that notices
have been sent to customers. This evidence may relate to the overall
notification process, and need not be customer-specific. For example, a
record showing the approximate dates notices are mailed or a written
procedure for the notification process would be evidence notices have
been sent. More in depth checks on compliance could be conducted where
warranted without requiring more detailed records. Therefore, we
clarified the final rule to provide that operators must maintain a copy
of the notice currently in use and evidence that the notices have been
sent to customers as required (Sec. 192.16(d)). Evidence of
notifications more than 3 years old may be discarded.
N. Master Meter Operators
One commenter recommended that we specifically exempt operators of
master meter systems from the final rule. Operators of master meter
systems purchase gas from pipeline companies through master meters, and
then resell and distribute the gas to customers. The customers are
usually residents of mobilehome parks or housing projects, the
operator's primary enterprise.
In developing the NPRM, we assumed the proposed rules would not
affect many master meter operators because they generally own all gas
distribution piping up to each customer's dwelling. However, as stated
above, WMPA advised that the proposed rules would affect mobilehome
parks in California because of customer-owned short sections of
connector piping. Although that piping was aboveground and would not
come under the final rule, it is reasonable to assume that buried
connector piping may occur in some master meter systems. So the
proposed rule may have affected small entities to a larger extent than
we first pictured.
To mitigate this impact, the final rule (Sec. 192.16(c)) allows
master meter operators to continuously post a general
[[Page 41828]]
notice as an alternative to sending notices to customers individually.
This type of notification is appropriate for master meter systems
because there is commonly a prominent place visited by residents, such
as a management office, that is suitable for such posting.
Although the final rule probably does not affect many master meter
operators, we did not adopt the suggestion to specifically exempt these
operators. As operators of distribution pipelines, they come under the
mandate when they do not maintain buried customer piping up to building
walls. Also, there is no evidence to suggest that customers of master
meter operators have less need for safety information than customers of
other operators.
III. Regulatory Analyses and Notices
A. Executive Order 12866 and DOT Policies and Procedures
The Office of Management and Budget (OMB) does not consider this
final rule to be a significant regulatory action under section 3(f) of
Executive Order 12866. Therefore, OMB did not review the final rule.
Also, DOT does not consider the final rule to be significant under its
regulatory policies and procedures (44 FR 11034, February 26, 1979). A
final regulatory evaluation is available for review in the docket.
B. Executive Order 12612
We analyzed the final rule under the principles and criteria in
Executive Order 12612 (``Federalism''). The final rule does not have
sufficient federalism impacts to warrant preparation of a federalism
assessment.
C. Regulatory Flexibility Act
I certify, under Section 605 of the Regulatory Flexibility Act,
that this final rule will not have a significant economic impact on a
substantial number of small entities. For purposes of that act, small
entities supply gas to fewer than 10,000 customers, and most small
entities are operators of master meter systems. As discussed above,
most master meter operators do not come under the final rule because
they own all gas piping up to building walls. Master meter operators
that do come under the rule may comply merely by posting a notice in a
prominent location. So compliance cost will be nominal for the bulk of
small entities. The remaining small entities, mostly operators of
distribution systems in small towns, will be subject to the same rule
as other operators. But, as explained above, operators can either avoid
notification costs by maintaining covered piping, or mitigate costs by
including general notices in billing envelopes.
D. Paperwork Reduction Act
OMB has approved the information collection requirements of this
final rule under 44 U.S.C. Chapter 35.
List of Subjects in 49 CFR Part 192
Natural gas, Pipeline safety, Reporting and recordkeeping
requirements.
RSPA amends 49 CFR part 192 as follows:
PART 192--[AMENDED]
1. The authority citation for part 192 is revised to read as
follows:
Authority: 49 U.S.C. 5103, 60102, 60104, 60108, 60109, 60110,
60113, and 60118; 49 CFR 1.53.
2. Section 192.16 is added to read as follows:
Sec. 192.16 Customer notification.
(a) This section applies to each operator of a service line who
does not maintain the customer's buried piping up to entry of the first
building downstream, or, if the customer's buried piping does not enter
a building, up to the principal gas utilization equipment or the first
fence (or wall) that surrounds that equipment. For the purpose of this
section, ``maintain'' means monitor for corrosion according to
Sec. 192.465 if the customer's buried piping is metallic, survey for
leaks according to Sec. 192.723, and if an unsafe condition is found,
either shut off the flow of gas or advise the customer of the need to
repair the unsafe condition.
(b) Each operator shall notify each customer once in writing of the
following information:
(1) The operator does not maintain the customer's buried piping.
(2) If the customer's buried piping is not maintained, it may be
subject to the potential hazards of corrosion and leakage.
(3) Buried gas piping should be--
(i) Periodically inspected for leaks;
(ii) Periodically inspected for corrosion if the piping is
metallic; and
(iii) Repaired if any unsafe condition is discovered.
(4) When excavating near buried gas piping, the piping should be
located in advance, and the excavation done by hand.
(5) The operator (if applicable), plumbers, and heating contractors
can assist in locating, inspecting, and repairing the customer's buried
piping.
(c) Each operator shall notify each customer not later than August
14, 1996, or 90 days after the customer first receives gas at a
particular location, whichever is later. However, operators of master
meter systems may continuously post a general notice in a prominent
location frequented by customers.
(d) Each operator must make the following records available for
inspection by the Administrator or a State agency participating under
49 U.S.C. 60105 or 60106:
(1) A copy of the notice currently in use; and
(2) Evidence that notices have been sent to customers within the
previous 3 years.
Issued in Washington, D.C. on August 9, 1995.
Ana Sol Gutierrez,
Deputy Administrator.
[FR Doc. 95-20021 Filed 8-11-95; 8:45 am]
BILLING CODE 4910-60-P
