[Federal Register Volume 59, Number 3 (Wednesday, January 5, 1994)]
[Rules and Regulations]
[Pages 516-531]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-45]


[[Page Unknown]]

[Federal Register: January 5, 1994]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 284

[Docket No. RM93-4-000; Order No. 563]

 

Standards For Electronic Bulletin Boards Required Under Part 284 
of the Commission's Regulations

Issued December 23, 1993.
AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Final rule.

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SUMMARY: The Federal Energy Regulatory Commission (Commission) is 
issuing a final rule adopting regulations to standardize the content 
of, and procedures for accessing, information relevant to the 
availability of service on interstate pipelines. The Commission's 
standards will require pipelines to make this information available on 
Electronic Bulletin Boards (EBBs) and through downloadable files and 
will detail procedures and protocols for EBB operation and file 
transfers.

DATES: February 4, 1994. Pipelines must implement the requirements of 
this rule by June 1, 1994, except where the procedures and protocols 
specify otherwise.

ADDRESSES: Federal Energy Regulatory Commission, 825 North Capitol 
Street, NE., Washington, DC 20426.

FOR FURTHER INFORMATION CONTACT:

Michael Goldenberg, Office of the General Counsel, Federal Energy 
Regulatory Commission, 825 North Capitol Street, NE., Washington, DC 
20426, (202) 208-2294.
 Marvin Rosenberg, Office of Economic Policy, Federal Energy Regulatory 
Commission, 825 North Capitol Street, NE., Washington, DC 20426, (202) 
208-1283.
Brooks Carter, Office of Pipeline and Producer Regulation, Federal 
Energy Regulatory Commission, 825 North Capitol Street, NE., 
Washington, DC 20426, (202) 208-0666.

SUPPLEMENTARY INFORMATION: In addition to publishing the full text of 
this document in the Federal Register, the Commission also provides all 
interested persons an opportunity to inspect or copy the contents of 
this document during normal business hours in room 3104, 941 North 
Capitol Street NE., Washington DC 20426.
    The Commission Issuance Posting System (CIPS), an electronic 
bulletin board service, provides access to the texts of formal 
documents issued by the Commission. CIPS is available at no charge to 
the user and may be accessed using a personal computer with a modem by 
dialing (202) 208-1397. To access CIPS, set your communications 
software to use 300, 1200, or 2400 bps, full duplex, no parity, 8 data 
bits, and 1 stop bit. CIPS can also be accessed at 9600 bps by dialing 
(202) 208-1781. The full text of this notice will be available on CIPS 
for 30 days from the date of issuance. The complete text on diskette in 
WordPerfect format may also be purchased from the Commission's copy 
contractor, La Dorn Systems Corporation, also located in room 3104, 941 
North Capitol Street, NE., Washington DC 20426.

Table of Contents

I. Introduction
II. Reporting Requirements
III. Background
IV. Summary of the Final Rule
V. Discussion of the Proposed Regulation
    A. Need For A Flexible Mechanism To Make Revisions To The 
Standards And Protocols
    B. Exemptions For Small Pipelines
    C. Implementation Date
    D. Modifications To The Regulatory Provisions
VI. Discussion of Items Included in the Standardized Data Sets and 
Communications Protocols
    A. Standardized Data Sets
    1. Operation of the Data Sets
    2. Date and Time Stamps
    3. Operationally Available Capacity
    4. Disclosure of Minimum Conditions
    B. Communication Protocols
    1. Electronic Data Interchange
    a. ASC X12
    b. ASCII Downloads
    2. Protocols For Communications Software and Hardware, Access 
Requirements, and Log-On Procedures
    C. Common Codes
    1. Introduction
    2. The Proposal
    3. Comments on the Working Group Filing
    4. Commission Adoption of the Working Group Proposal
VII. Issues not Addressed in the Standardized Data Sets and 
Communication Protocols
    A. Proposed Additions To The Standardized Data Sets
    1. Index of Purchasers
    2. Nominations for Firm and Interruptible Capacity
    B. Communication Protocols For Uploading Files and Downloading 
Subsets Of Files
    C. Standardization Of Non-Capacity Release Business Transactions
    D. Policy Issues
    1. Costs of Standardization
    2. Liability
    3. Non-Price Considerations
    E. Gas Industry Standards Board
VIII. Environmental Analysis
IX. Regulatory Flexibility Act Certification
X. Information Collection Requirement
XI. Effective Date
Regulatory Text
Appendix A--Parties Filing Comments On The Notice Of Proposed 
Rulemaking

I. Introduction

    In Order No. 636,1 the Commission created a new operating 
environment for interstate pipelines and shippers on those pipelines by 
requiring pipelines to unbundle the sale of gas from the transportation 
of that gas and by introducing a mechanism permitting shippers to trade 
unneeded capacity through Electronic Bulletin Boards (EBBs) maintained 
by the pipelines. Because shippers will now be transporting gas over 
multiple pipelines, the Commission concluded that the development of 
uniform standards covering the content of, and methods for accessing, 
information relating to transportation would improve the efficiency of 
gas movement across the interstate pipeline grid. To begin the process 
of developing the needed standards, the Commission directed its staff 
to convene a series of informal conferences with all facets of the gas 
industry to consider standards relating to capacity allocation. As a 
result of these conferences, the industry reached consensus agreements 
on the information about available capacity that should be included on 
EBBs and the procedures and protocols for making that information 
available.
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    \1\Pipeline Service Obligations and Revisions to Regulations 
Governing Self-Implementing Transportation; and Regulation of 
Natural Gas Pipelines After Partial Wellhead Decontrol, 57 FR 13267 
(Apr. 16, 1992), III FERC Stats. & Regs. Preambles 30,939 (Apr. 8, 
1992), order on reh'g, Order No. 636-A, 57 FR 36128 (August 12, 
1992), III FERC Stats. & Regs. Preambles 30,950 (August 3, 1992), 
order on reh'g, Order No. 636-B, 57 FR 57911 (Dec. 8, 1992), 61 FERC 
61,272 (1992), appeal pending sub nom., Atlanta Gas Light Co. and 
Chattanooga Gas Co. v. FERC, No. 92-8782 (11th Cir. Aug. 13, 1992).
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    The Commission is adopting a final rule reflecting the consensus 
agreements reached by the industry. The rule amends the Commission's 
open access regulations by requiring pipelines to provide standardized 
information about the availability of service on their systems. This 
information will be provided both on the pipelines' EBBs and through 
files which users can download from the pipelines' computers to their 
own computers. The rule further requires pipelines to provide this 
information according to standardized procedures and protocols, which 
will be maintained in a document entitled ``Standardized Data Sets and 
Communication Protocols'' that can be obtained at the Commission. 
Pipelines must implement the requirements of this rule by June 1, 1994.
    The Commission also recognizes the standards and protocols it is 
adopting will need to be updated as more experience with capacity 
release and the transportation environment under Order No. 636 is 
obtained. The Commission, therefore, is proposing to continue the 
industry conferences to consider and propose modifications when needed.

II. Reporting Requirements

    The Commission estimates the public burden for the information 
requirement under this final rule--including the one-time start-up 
burden related to pipeline EBBs--will average 6,770 hours per company. 
The burden estimate includes the time required to review and implement 
the standards, develop the necessary software, search existing data 
sources, gather and maintain the data needed, create/validate common 
and proprietary codes/information and complete and review the 
information. The information/data elements required to be maintained on 
pipeline EBBs will be under a new information requirement, FERC-549(B), 
Gas Pipeline Rates: Capacity Release Information. The annual burden 
associated with the new FERC-549(B) information requirement will be 
528,060 hours based on the estimated initial EBB development burden and 
daily EBB informational updates by an anticipated 78 pipeline 
respondents.
    Included in the annual burden estimate are 40,560 hours (520 hours 
per company) attributable to the creation of common/proprietary codes 
to identify pipelines and common transaction points. The codification 
requirements were not part of the burden estimates contained in the 
Commission's Notice of Proposed Rulemaking (NOPR) issued July 29, 1993.
    Because the final rule contains new information and EBB 
requirements, many of which are one-time start-up activities, it is 
anticipated that FERC-549(B) burden will be reduced by 2,250 hours per 
respondent (for a total reduction of 175,500 hours for all respondents) 
the year following the implementation of the EBB systems.
    Arkla Energy Resources Company and Mississippi River Transmission 
Corporation state that providing comments on the burden estimate in the 
NOPR is difficult until final resolution of EBB issues. Interstate 
Natural Gas Association of American states the burden estimate in the 
NOPR is reasonable for the items included in the proposed rule, but 
would be too low if additional items, such as common codes are 
included. No party has submitted contrary data on a revised burden 
estimate for the requirements proposed in the NOPR. The only 
significant change from the NOPR is the requirement to create a common 
code data base and the Commission has revised its estimate to include 
the additional burden of this effort. Accordingly, the Commission finds 
its burden estimates reasonable.
    Interested persons may send comments regarding these burden 
estimates or any other aspect of this information requirement, 
including suggestions for reductions of the burden, to the Federal 
Energy Regulatory Commission, 941 North Capitol Street, NE., 
Washington, DC 20426 [Attention: Michael Miller, Information Services 
Division, (202) 208-1415, FAX (202) 208-2425]; and to the Office of 
Information and Regulatory Affairs, Office of Management and Budget, 
Washington, DC 20503 [Attention: Desk Officer for Federal Energy 
Regulatory Commission].

III. Background

    In Order No. 636, the Commission required pipelines to establish 
EBBs to provide shippers with equal and timely access to relevant 
information about the availability of service on their systems, 
including service available through capacity release transactions and 
firm and interruptible capacity available directly from the 
pipeline.2 The Commission recognized the efficiency of capacity 
allocation would be enhanced by standardizing both the content of 
capacity release information and the methods by which shippers could 
access that information.3 On February 26, 1993, the Commission 
held a technical conference to examine the industry's efforts in 
standardizing information content and communication procedures. The 
participants at the conference expressed a willingness to establish a 
broad industry-wide working group to reach consensus on standards 
governing capacity release transactions. The Commission subsequently 
established informal conferences with Commission staff and all 
interested members of the gas industry to facilitate the development of 
consensus standards.4
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    \2\18 CFR 284.8(b)(3)(4), 284.9(3)(4).
    \3\Order No. 636-A, III FERC Stats. & Regs. Preambles at 30,549.
    \4\Notice Of Informal Conferences (March 10, 1993), 54 FR 14530 
(Mar. 18, 1993).
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    A broad spectrum of firms and organizations participated in these 
Working Groups, including representatives from the major segments of 
the gas industry and other interested parties, such as computer and 
software firms. The participants at the conferences divided their 
efforts into five working groups covering different areas of 
standardization and, on July 1 and July 6, 1993, the Working Groups 
submitted reports on their deliberations. Working Groups 1 and 2 
reached consensus on proposed standardized data sets setting forth the 
information concerning available capacity. Working Group 4 agreed on a 
set of communication protocols governing the dissemination of the 
information. Working Group 5 proposed methods for developing codes to 
identify companies and common transaction points, but had not finalized 
standards in these areas. Working Group 3 reported on its progress in 
considering standards relating to business practices other than 
capacity release, but did not propose any standards. The Working Group 
reports included minority positions on several items. The Commission 
also provided an additional period for the public to comment on the 
Working Group proposals.
    On July 29, 1993, the Commission issued a Notice Of Proposed 
Rulemaking (NOPR) proposing to adopt standards reflecting the consensus 
agreements reached by the industry working groups.5 The NOPR also 
provided for the continuation of the Working Groups and set a number of 
items for further consideration, with reports generally due by February 
1, 1994.6
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    \5\Notice Of Proposed Rulemaking, 58 FR 41647 (Aug. 5, 1993), IV 
FERC Stats. & Regs. Proposed Regulations 32,500 (July 29, 1993).
    \6\Working Group 5 was given an October 1, 1993 report date for 
its proposal dealing with common transaction point codes.
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    Forty comments were received on the NOPR.7 In addition, on 
October 12, 1993, Working Group 5 filed its report containing a 
finalized proposal for providing common transaction point codes, and on 
November 3, 1993, Working Groups 1 and 2 filed revisions to the 
proposed capacity availability data sets. The Commission noticed both 
filings and provided the industry with an opportunity to submit 
comments on the filings and to discuss them at an informal 
conference.8
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    \7\The commenters, and the abbreviations used for each, are 
listed in Appendix A. Con Edison and PSCW filed comments late. The 
Commission will consider these comments.
    \8\AER/MRT, IPAA, Gaslantic, National Registry, NYMEX/EnerSoft, 
Process Gas Consumers Group, and Transco submitted comments on the 
common code proposal. ANR submitted comments on the revised data 
sets.
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IV. Summary of the Final Rule

    The final rule adopts the regulation and standards as proposed in 
the NOPR, with only slight modifications. The final rule adopts 
Sec. 284.8(b)(5) requiring pipelines to provide standardized 
information relevant to the availability of service on their systems. 
Under the rule, pipelines must provide the standardized information on 
their EBBs and provide users with the ability to download the 
standardized information in compliance with standardized procedures and 
protocols. The rule provides that the details of the required 
information, procedures, and protocols will be made available in a 
document entitled ``Standardized Data Sets and Communication 
Protocols,'' which would be available from the Commission's Public 
Reference and Files Maintenance Branch.9 Because the standardized 
information includes information relevant to the availability of 
interruptible transportation, the rule also revises Sec. 284.9(b)(4), 
which governs interruptible transportation, to cross-reference the 
standardization requirements in Sec. 284.8(b)(5).
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    \9\This document will not be published in the Federal Register.
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    In summary, the standardized data sets set forth the information 
concerning capacity availability that pipelines must provide both on 
their on-line EBBs and through downloadable files.10 This 
information includes offers to sell firm capacity (either by the 
pipeline or releasing shippers), bids for capacity, awards of capacity, 
withdrawals of capacity offers and bids, operationally available (i.e., 
interruptible) capacity, and system-wide notices. The protocols 
establish principles and procedures relating to the operation of 
pipeline EBBs and the provision of downloadable files to users. Under 
these protocols, pipelines will provide for file downloads in two 
formats: one that complies with standards for Electronic Data 
Interchange (EDI) promulgated by the American National Standards 
Institute (ANSI) Accredited Standards Committee (ASC) X12 and a second 
format that does not comply with ASC X12, but which provides files in 
standard flat ASCII format.11 The Commission is changing the 
implementation of the regulation from the April 1, 1994 date proposed 
in the NOPR to June 1, 1994, unless the standards and protocols specify 
a different compliance date.12
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    \1\0On-line EBB refers to a continuous computer connection 
between a pipeline EBB and a user's computer in which the 
information from the pipeline's computer is displayed visually on 
the user's computer and the user can enter data directly to the 
pipeline's computer. File downloading refers to the transfer in 
computerized format of a file from the pipeline's computer to the 
user's computer. The user can use its own internal computer programs 
to manipulate the data.
    \1\1ASCII refers to the American Standard Code for Information 
Interchange, a code for character representation. The Commission 
recognizes the ASC X12 files also use ASCII characters. The 
Commission is using the term ASCII download to refer to standard 
flat file downloads that do not necessarily meet the requirements of 
the ASC X12 standards.
    \1\2The June 1, 1994 date will not apply to the requirement that 
pipelines provide a common code system. The date for implementation 
of this requirement is November 1, 1994.
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    The comments addressed issues relating to the proposed regulation, 
the standards and protocols that were proposed for inclusion in the 
Standardized Data Sets and Communication Protocols, and the items which 
the Commission proposed not to include in the data sets and protocols. 
The Commission will address the issues raised in each area in turn.

V. Discussion of the Proposed Regulation

A. Need for a Flexible Mechanism To Make Revisions to the Standards and 
Protocols

    In the NOPR, the Commission proposed to proceed through rulemaking, 
rather than a policy statement, finding that the benefits of 
standardization can be achieved only when all pipelines provide the 
same information through the same procedures. The Commission concluded 
a rulemaking was the proper approach to issuing mandatory requirements.
    Several commenters support the Commission's issuance of a rule to 
ensure full compliance, but urge the Commission to commit itself to a 
process for revising the requirements.13 They maintain that once 
the industry obtains experience with capacity release, revisions may be 
needed. Natural supports the use of notice and comment rulemaking, but 
it requests clarification that, even though the referenced document of 
standards and protocols is not contained in the Code of Federal 
Regulations, any modifications to these standards or protocols will be 
made through rulemaking procedures. It maintains changes to this 
document could result in significant administrative burdens and costs 
and, therefore, contends the Administrative Procedure Act (APA) 
requires that such changes be made only through a notice and comment 
rulemaking. O&R and Williston urge the Commission to proceed using a 
policy statement to ensure the utmost flexibility for modifications.
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    \1\3Power Generators, AGA, Columbia Distribution, Destec Energy, 
FMA, and UDC.
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    The Commission adheres to its determination to proceed through 
rulemaking to ensure the uniformity standardization requires. 
Nevertheless, the Commission agrees with the commenters that revisions 
and modifications to the standards and protocols will need to be made 
on a regular basis as the industry obtains more experience with 
capacity release transactions and with the changed operating 
environment created by Order No. 636. For example, in the two months 
after issuance of the NOPR, Working Groups 1 and 2 already have 
proposed revisions to the standardized data sets to ensure that they 
function effectively and to clarify a number of items. The Commission 
proposes to continue the informal conferences and the Working Groups as 
the best means for monitoring the performance of the standards and 
proposing needed changes.
    To facilitate the Commission's ability to respond to the need for 
changes, it adopted only a general regulation requiring the pipelines 
to standardize their provision of capacity information, while the 
standards and protocols themselves were to be provided in a separate 
document not contained in the Code of Federal Regulations. The 
Commission is committed to making needed modifications and revisions to 
the standards and protocols as quickly as possible. Determining the 
appropriate mechanism for making such changes is premature, because the 
method should vary depending on the type of change contemplated; 
maintenance of the standards to correct problems or improve their 
functioning should be handled differently than significant substantive 
changes in the means of providing the information.
    In making changes to the data sets and protocols, the Commission 
intends to follow the APA and provide notice and an opportunity for 
comment, just as it has in the past with respect to proposed changes by 
the Working Groups. For example, when Working Groups 1 and 2 submitted 
their recent set of revisions, the Commission noticed the filing and 
provided an opportunity for written comments as well as for 
consideration of the revisions at one of the Commission's EBB 
conferences.
    Although the Commission is issuing the current data sets along with 
this rule, the Commission realizes that as pipelines begin the process 
of correlating the downloadable data sets with the information provided 
by offerors and bidders through their on-line EBBs, difficulties with 
the data sets may be identified. All pipelines immediately must begin 
the correlation process, so they can report any significant 
difficulties to Working Groups 1 and 2. The Commission is committed to 
implementing the data sets by June 1, 1994, and Working Groups 1 and 2, 
therefore, should ensure that they provide the Commission with any 
additional changes they believe are essential in sufficient time to 
permit implementation of the data sets, including ASC X12 
downloadability, by that date. The Commission recognizes that the data 
sets may not be perfect when implemented, but, as discussed above, the 
Commission is committed to a process for revising the data sets on a 
regular basis after implementation.

B. Exemptions for Small Pipelines

    Sabine maintains small pipelines may not be able to comply with the 
requirements outlined in the NOPR. It does not suggest a blanket 
exemption for small pipelines, but instead recommends they be afforded 
an opportunity to demonstrate that the costs of implementing the 
standards would outweigh the benefits of compliance.14
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    \1\4It points out the Commission exempted it from compliance 
with the interactive EBB requirement in its restructuring order. 
Sabine Pipe Line Company, 63 FERC 61,010 (1993).
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    The Commission recognizes small pipeline compliance with some of 
the requirements of the standards and protocols may not be cost 
justified or essential to obtain the benefits the Commission sought to 
achieve through standardization. The Commission cannot make a generic 
determination of the particular standards and protocols with which 
small pipelines should not have to comply; compliance with some of the 
standards may not involve as much added cost as compliance with others 
and partial compliance may still be of benefit to users.15 Small 
pipelines desiring an exemption should file a petition under Rule 207 
of the Commission's Rules of Practice and Procedure listing the 
specific requirements for which they seek exemption and explaining why 
the exemption is justified.16 Users will then be given an 
opportunity to comment on the proposed application.
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    \1\5For example, provision of the data contained in the 
standardized data sets may not be unduly costly and would permit 
users to obtain the same information from all pipelines.
    \1\618 CFR 385.207.
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C. Implementation Date

    In the NOPR, the Commission proposed an April 1, 1994 
implementation date, finding this date would provide pipelines with 
sufficient time to program their computers to incorporate the changes 
required and would permit final testing of the system during the off-
peak summer season. Many commenters support the April 1, 1994 
implementation date, some suggesting no extension be given.\17\ Peoples 
Gas, et al., and UDC state this date should not result in delay in 
implementing the on-line EBBs already required by Order No. 636. Some 
commenters contend the April 1, 1994 date is sufficient for the items 
included in the NOPR, but would not give sufficient time for 
implementation of additional requirements resulting from the Working 
Groups' February 1, 1994 reports on those items which the Commission 
set for further consideration.\18\ Other commenters contend the April 
1, 1994 date is too ambitious for all items and assert the Commission 
should not set an interim date, but should require full implementation 
by the fall of 1994.\19\ AER/MRT contends an April 1, 1994 
implementation date for the ASC X12 requirement, in particular, is 
unreasonably ambitious.
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    \17\Power Generators, Con Edison, WEV, Destec Energy, NGSA, 
NYMEX/EnerSoft, O&R, Peoples Gas, et al., UDC, Process Gas Consumers 
Group (noting that capacity release transactions may be heaviest in 
the off-season), Transco (if development of ASC X12 not unduly 
delayed).
    \18\INGAA, Natural.
    \19\AER/MRT, Columbia Gas, Enron, KGPL.
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    The Commission will agree to delay the implementation date to June 
1, 1994, to allow the Working Groups and the pipelines to make final 
revisions that will improve the functioning of the EBBs and the 
downloadable data sets. But, given this extension, the Commission 
expects the pipelines to have an operational set of standards fully 
implemented by June 1, 1994. At the same time, the June 1, 1994 date 
will permit capacity release transactions, which may be significant in 
the off-peak season, to benefit from the standards. The June 1, 1994 
date applies to the implementation of EDI, but not to the 
implementation of common codes, as discussed later.\20\ The Commission 
clarifies that this date applies only to the items included in this 
rule, not to further items resulting from the February 1, 1994 reports. 
The June 1, 1994 date also does not delay pipelines' compliance with 
the EBB requirements of Order No. 636; pipelines must comply with these 
requirements by the date specified in their restructuring orders.
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    \20\See text accompanying notes 36 and 51, infra.
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    The June 1 date is not an interim date, but the final date for 
compliance with these requirements. The reference in the NOPR to final 
testing during the off-peak season meant only that full scale operation 
would operate as the final check to uncover lacunae in operation not 
detected during routine small scale (or beta) testing of the 
system.\21\ As stated earlier, the Commission expects full 
implementation of the data sets and communication protocols by no later 
than the June 1, 1994 date.
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    \21\By beginning full-scale operation during the summer, the 
standards will be in effect during the period when capacity release 
transactions may be significant, but, at the same time, any final 
problems with the system can be resolved when obtaining gas supplies 
is not as crucial as during the peak winter heating season.
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    Williston Basin asserts the February 1, 1994 date for the Working 
Group reports is premature since the industry will not have sufficient 
experience with capacity release by then to make additional 
modifications. The Commission is not persuaded to change the February 1 
date for the Working Group reports. These reports are intended to cover 
the items on which the parties did not have the time to reach consensus 
in time for their July reports, but which the Commission found were 
susceptible to resolution given more time. As discussed earlier, the 
Commission is committed to updating these standards when necessary in 
light of experience. The timing of additional meetings or reports to 
consider further revisions are better made at a later point.

D. Modifications to the Regulatory Provisions

    NGSA and Process Gas Consumers Group suggest the rule should be 
revised to require each pipeline to submit a compliance filing 
specifying in its tariff the details of how it will supply the services 
required by the rule. UDC suggests the imposition of reporting 
requirements to permit the Commission and the public to monitor the 
initial operation of EBBs.
    The Commission perceives no need at this point for requiring 
compliance filings by pipelines or the submission of periodic reports. 
The requirements of the rule are straight-forward. The communication 
protocols require pipelines to provide users with scripts detailing the 
procedures for accessing (logging-on to) the pipelines' computer 
systems, and providing further detail through tariff filings seems 
unnecessary. Monitoring of the system can be better accomplished 
through Commission oversight of pipelines' compliance by accessing 
their EBBs and through the use of industry conferences than through 
tariff filings or inflexible periodic reporting requirements.
    Process Gas Consumers Group suggests the deletion of the phrase 
``on its Electronic Bulletin Board'' from the opening clause of the 
rule. It contends this phrase suggests the rule may not cover EDI 
access to data, may not apply to pipelines using third-party vendors to 
provide EBB services, and appears to require pipelines to provide 
information about accessing their EBB solely through their EBB, thereby 
creating a Catch-22 in which shippers can obtain information on how to 
access a pipeline's EBB only by knowing how to access the EBB.
    The Commission will not delete the reference to Electronic Bulletin 
Boards because pipelines must provide the required information on their 
EBBs as well as through downloadable files. The Commission, however, 
will modify the regulation slightly to make even more explicit that 
both modes of communication must be provided. The Commission expects 
pipelines to provide users with instructions for accessing their EBBs 
or using EDI transfers without having the user first access the 
pipelines' EBB.

VI. Discussion of Items Included in the Standardized Data Sets and 
Communication Protocols

    The Commission proposed to set forth the information on capacity 
availability and the protocols governing the dissemination of that 
information in a separate document entitled Standardized Data Sets and 
Communication Protocols that would be available at the Commission. The 
Commission included this document in the NOPR and commenters raised 
issues with respect to the proposed provisions.

A. Standardized Data Sets

1. Operation of the Data Sets
    El Paso requests clarification that a pipeline can leave fields in 
the data sets blank if the pipeline's tariff does not require the 
information to be provided. It cites, as an example, differences in 
pipelines' tariffs as to whether volumetric releases are subject to 
minimum quantity requirements.
    ANR contends the definitions of the terms mandatory and optional, 
as used for some fields in the data sets, are confusing. It submits 
mandatory refers to data fields that every pipeline must support, while 
optional refers to data fields pipelines may offer at their discretion, 
unless their individual tariffs require that those fields be supported. 
If optional means that all pipelines must support the field, thereby 
permitting releasing shippers or bidders with the option of including 
information in the field, ANR asserts it would have to incur added 
expense to redesign its EBB to include these fields.\22\
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    \22\As an example of the difference in definition, an optional 
field is releaser contract number. Data Set I.1, line 6. Under ANR's 
definition, pipelines would have the discretion to include this 
field. Under the second interpretation, pipelines must provide the 
field so releasing shippers have the ability to include the 
information.
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    In general, the Commission understands that El Paso's and ANR's 
interpretation of the manner in which the data sets are designed to 
operate accords with the intent of the Working Groups, and the 
Commission agrees with that approach. The Commission, however, sees a 
need to provide further clarification of the operation of the data sets 
and the mandatory and optional characterization of certain fields. At 
the outset, it is important to recognize that these data sets must 
apply to all pipelines, and, therefore, the Working Groups had to 
design them to be flexible enough to accommodate the different 
operational characteristics and information requirements of different 
pipelines. Implementation of the data sets perforce will differ across 
pipelines.
    The data sets are organized along the following lines. First, they 
are divided into generic groups for offers, bids, awards, withdrawals, 
operationally available capacity, and system wide notices. Some of 
these groups are then divided into specialized data sets, for example 
for receipt and delivery point information or for storage releases. 
Each of these subsets contain mandatory, optional, or contingent 
fields.
    All pipelines must support the six broad categories of data sets. 
Pipeline support of the subsets within each category, however, may 
depend on the operational characteristics of individual pipelines.\23\ 
For example, data sets are included for receipt and delivery point 
information and for segment information although not all pipelines are 
segment systems. Pipelines will choose from among the combination of 
these data sets the ones that best present the relevant information for 
their systems.
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    \23\The easiest example is the storage data sets which obviously 
will not have to be supported by pipelines without storage fields.
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    All pipelines choosing a particular data set will be required to 
support the mandatory fields in that data set. Pipelines are not 
required by this rule to support the optional fields. Some pipelines, 
however, may be required by their tariffs or other requirements, to 
support some of the optional fields.\24\ Moreover, pipelines must 
display all information, whether mandatory or optional, on their on-
line EBBs. For example, if a pipeline is not now displaying mandatory 
information on its on-line EBB, it must revise its display format to 
accommodate that information.
---------------------------------------------------------------------------

    \24\The contingent fields are filled only when a condition in 
another field is met.
---------------------------------------------------------------------------

    As mentioned earlier, the Working Groups are continuing to make 
refinements in the data sets. In making these refinements, they should 
make a further effort to clarify how pipelines must implement these 
requirements, such as which fields pipelines must support and which are 
optional.
    Enron suggests the standardized data sets should be minimum 
requirements that pipelines can supplement to accommodate tariff 
provisions. As an example, it claims the data sets do not accommodate 
Florida Gas' proposal to permit several shippers temporarily to combine 
their capacity rights to facilitate release transactions.
    The Commission is not sure what flexibility Enron is requesting. 
Pipelines cannot add or delete fields from the capacity data sets 
because standardization requires that all pipelines use the same 
structure for downloading, so shippers can process that information 
using the same computer software. For example, if pipelines could add 
new data fields, shippers' ASC X12 software might be unable to 
interpret the information because the software is keyed to the specific 
fields on the implementation guide. Moreover, the Working Groups 
anticipated the need to accommodate special release offers or unique 
circumstances and included special terms and miscellaneous note fields 
for providing such details.\25\ As discussed previously, the Commission 
recognizes that pipelines may uncover difficulties in correlating their 
information requirements with the downloadable data sets and the 
Commission anticipated possibly having to make corrections to the data 
sets. The best way for pipelines to avoid problems is to begin the 
implementation process immediately so they can report difficulties to 
the Working Groups for resolution prior to implementation.
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    \25\Enron did not describe the specific problem created by 
combination offers, and the Commission cannot discern why it could 
not be accommodated within the prescribed data sets. For example, 
the combination offer could be assigned a single offer number (Data 
Set I.1, line 3) with any special circumstances described in the 
miscellaneous field (Data Set I.1, line 52).
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2. Date and Time Stamps
    The proposal put forward by Working Groups 1 and 2 included fields 
identifying the date and time when release offers, bids, withdrawals of 
bids or offers, and capacity awards are posted on pipelines' EBBs. No 
consensus was reached over whether fields should be included to 
identify when pipelines actually received offers, bids, or withdrawals 
or made the determination to award capacity.
    The NOPR proposed to require the inclusion of fields for bid 
receipt date and time, but not for the date and time offers and 
withdrawals were received or capacity awarded. Since releasing shippers 
and pipelines may choose the first come, first served method to break 
ties, the Commission found that routine posting of the bid receipt date 
and time would permit shippers to verify the award of capacity without 
having to contact the pipeline. The Commission did not propose to 
include the date and time fields for receipt of offers and withdrawals 
or capacity awards, concluding this information was not as important to 
capacity release transactions as the bid information. The Commission 
stated, however, that information about the date and time offers and 
withdrawals were received and capacity awards determined must be 
provided by the pipelines upon request.
    Several commenters support the Commission's decision to include 
only the information about bid receipt in the standardized data 
sets.26 Some request clarification as to whether pipelines must 
include both the date and time bids are received and posted as 
mandatory fields.27 Process Gas Consumers Group contends the 
Commission should require inclusion of all the contested items. It 
contends the date and time for receipt of capacity withdrawals is 
particularly important because releasing shippers have only a limited 
right to withdraw offers; it maintains the date and time information is 
needed so bidders can determine whether that right has been exercised 
validly. It contends pipelines easily can make all the contested 
information available in electronic form. The National Registry 
requests that even if pipelines are not required to post information 
concerning the receipt of offers and withdrawals and determination of 
capacity awards, they should be required to provide this information in 
electronic form when requested.
---------------------------------------------------------------------------

    \2\6Power Generators, AER/MRT, Columbia Gas, Enron.
    \2\7KGPL (posting date and time should not be mandatory), NGSA 
(both should be required).
---------------------------------------------------------------------------

    The Commission adheres to its decision not to require pipelines 
routinely to post the receipt date and time for capacity offers and 
withdrawals and the date and time capacity awards are made. The Working 
Groups could not reach agreement on providing the additional 
information, and, as stated in the NOPR, the Commission does not find 
that this information is as crucial to capacity release, or will be 
needed as frequently, as the bid information. The Commission will not 
require pipelines to provide the additional information in electronic 
form, because such a requirement would not be significantly different 
than requiring the routine, electronic posting of this information, 
which the Commission has determined is not necessary. The ability of 
users to obtain the information for offers, withdrawals, and awards 
upon request appears sufficient. The Commission clarifies that both the 
bid receipt and bid posting data fields are mandatory.
    PEC Pipeline Group contends the date and time for bids should be 
the posting time, arguing if receipt date and time is used, the 
information would be unreliable because the bids would not have been 
verified for accuracy. It maintains only the date and time of verified 
bids should be used to break ties.
    The Commission agrees, in principle, that the appropriate 
information to include is the date and time used to break ties. 
However, in most instances, that will be the date and time bids are 
received, not when they are verified. For example, when bids are 
submitted near the end of bidding periods, the pipeline may not verify 
the bids until after the bid window closes. Under a first come, first 
served tie breaking system, capacity would be awarded to the highest 
bid received first in time even if the bid was not verified until 
later.
3. Operationally Available Capacity
    The Commission proposed to adopt the Working Group's consensus 
agreement that pipelines provide information on the amount of 
unscheduled capacity available at specific locations, such as receipt 
and delivery points, mainline, or mainline segments. This field serves 
to identify the capacity that would be available as interruptible 
service from the pipeline. Edison contends this definition would not 
allow shippers to determine whether firm or interruptible capacity is 
available. It suggests operationally available capacity be defined as 
the capacity a firm shipper can nominate at a point, asserting this 
definition would include interruptible capacity that can be displaced 
by a firm shipper. Transco contends the amount of unscheduled capacity 
is proprietary information that would not be provided in the free 
market. Williston Basin does not oppose this requirement, but states 
shippers may be able to use this information only for trend analysis, 
not for making decisions on a daily basis.
    The Commission finds the requirement to provide information on 
operationally available or unscheduled capacity is necessary to comply 
with the requirement that pipelines identify the interruptible capacity 
available on their systems.28 The unscheduled capacity at a point 
reveals the capacity available as interruptible service. In response to 
Edison's comment, the Commission finds that the consensus approach is 
adequate at this point to disclose both the firm and interruptible 
capacity available to potential shippers. The operationally available 
capacity reveals interruptible service and pipelines also are required 
to post the firm service they have available.29 The Working Groups 
still are considering issues relating to operationally available 
capacity, and the Commission will be open to modification of this 
definition if needed.30
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    \2\8See 18 CFR 284.9(b)(3).
    \2\9See 18 CFR 284.8(b)(3). Pipelines would post this 
information under the capacity offer data set I.1.
    \3\0For example, the Commission is not certain whether Edison 
and Transco principally are concerned with the definition of 
operationally available (or unscheduled) capacity or with the 
different, albeit somewhat related, issue of whether additional 
fields are required to divide scheduled (or nominated) capacity into 
firm and interruptible components. The issue of identifying the firm 
and interruptible components of nominated capacity is still under 
deliberation by the Working Groups, and Edison and Transco will have 
a further opportunity to address these issues in the Working Group 
meetings.
---------------------------------------------------------------------------

    ANR asserts that the data field for operationally available 
capacity should indicate that the data may be estimates. It also 
suggests an additional data field to enable the pipeline to qualify the 
accuracy of any information. The Commission agrees with ANR that the 
information in this field may be estimates and leaves to the Working 
Groups the decision on whether another field is necessary to convey 
information about how the estimates are provided.
    As discussed earlier, NGSA suggested pipelines be required to make 
compliance filings and it submits that these filings include 
information on the locations at which operationally available 
information will be provided, the manner of display, and the timeliness 
of the data. WEV suggests generally that the information provided under 
the data sets be as current as the pipeline can provide. While 
pipelines will not be required to make compliance filings to implement 
this rule, they should provide users with adequate information about 
the locations at which they are reporting the information and the 
timeliness of the information, which should be as current as is 
possible. Since the Commission will have access to the pipelines' EBBs, 
it can monitor the adequacy of the information pipelines provide.
4. Disclosure of Minimum Conditions
    Hadson contends the Commission should eliminate the field providing 
for disclosure of minimum price terms (Data Set I.1, lines 23 and 24). 
It contends disclosure of this information while the market is open 
facilitates collusion among releasing shippers to maintain higher 
prices in a falling market. The Commission will not eliminate this 
field because it comports with the Commission's policy of providing 
releasing shippers with the option of having their minimum conditions 
posted on the EBB.31 This technical proceeding is not the proper 
forum to reexamine the Commission's policy in this regard. The 
Commission notes, however, that, in a free market, sellers can choose 
to disclose minimum price conditions if they find such disclosure 
beneficial. For example, stating a minimum price protects against the 
possibility a deal will fail simply because a buyer submits a bid lower 
than the minimum price even though it is willing to pay the minimum 
price if it had known this condition. Moreover, since minimum price 
terms are public, the Commission can monitor the situation, and 
eliminate this field, if experience shows it does facilitate collusion.
---------------------------------------------------------------------------

    \3\1See El Paso Natural Gas Company, 62 FERC 61,311 at 62,999-4 
(1993). Releasing shippers choosing not to post their minimum 
conditions disclose those conditions only to the pipeline which then 
uses those conditions in evaluating bids.
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B. Communication Protocols

1. Electronic Data Interchange
    The Commission proposed to adopt the recommendation of Working 
Group 4 by requiring EBB operators32 to provide for electronic 
file downloading of the standardized data sets in compliance with ASC 
X12 EDI standards and an implementation guide to be developed by the 
Gas*Flow group.33 ASC X12 standards provides an electronic data 
submission capability that allows computers to exchange information 
over communication lines using standardized formats. To facilitate 
these transfers, the ASC X12 standards provide standardized transaction 
sets for different types of transactions, such as requests for 
quotations and responses to such requests.34 Since the ASC X12 
transaction sets provide generic data groups applicable to a range of 
potential applications, the transaction sets must be customized to 
individual applications by correlating or ``mapping'' the specific 
information to an ASC X12 transaction set through an implementation 
guide.
---------------------------------------------------------------------------

    \3\2The Commission is adopting Working Group 4's use of the 
phrase ``EBB operator'' in the protocols. An EBB operator is either 
a pipeline or a third-party vendor providing EBB services for a 
pipeline, and pipelines relying on third-party vendors must ensure 
they comply with these standards.
    \3\3Gas*Flow was organized to promote the acceptance of ASC X12 
EDI in the gas industry. It is composed of representatives from the 
gas industry, including local distribution companies, marketers, 
producers, shippers, and pipelines, and operates under guidance from 
the Natural Gas Review Committee.
    \3\4Because the ASC X12 transaction sets have been standardized, 
commercial software and consulting services are available to assist 
users in translating data from standard program files to the 
standardized ASC X12 formats and vice versa.
---------------------------------------------------------------------------

    The Commission anticipated Gas*Flow would be able to receive 
industry input and submit a final implementation guide to the 
Commission within a month after promulgation of the final data sets. 
The Commission also proposed to require file downloads in a flat ASCII 
format in accordance with documentation developed by Gas*Flow, but 
requested comments on whether requiring downloads in ASCII format was 
needed to supplement the downloads in ASC X12 format.35
---------------------------------------------------------------------------

    \3\5The flat ASCII files also could be transmitted 
electronically over communication lines.
---------------------------------------------------------------------------

    a. ASC X12. A few comments address the proposed implementation date 
for ASC X12. Tenneco asserts the April 1, 1994 implementation date 
should not include EDI compliance, because EDI should be implemented 
only when trading partners agree. AER/MRT suggest the date is too 
ambitious for ASC X12 implementation. PEC Pipeline Group maintains ANSI 
must approve the implementation guide developed by Gas*Flow and asserts 
obtaining this approval could affect the timing of ASC X12 
implementation as well as the commitment of ASC X12 software vendors to 
guarantee the use of their software with these data sets. Despite these 
concerns, PEC Pipeline Group is willing to go forward and implement ASC 
X12 based on Gas*Flow's recommendations.
    Working Group 4 found that ANSI approval of the data sets was not 
necessary to go forward with ASC X12 implementation, because the 
information could be mapped to an existing ASC X12 data set.36 
This is the task Gas*Flow will perform. Only one comment suggested that 
the April 1, 1994, date was too ambitious for ASC X12 implementation. 
Since the Commission has now extended the implementation date to June 
1, 1994, EBB operators should have sufficient time to program their 
computer systems to make ASC X12 downloads available by that 
date.37
---------------------------------------------------------------------------

    \3\6Working Group 4 Report at 9.
    \3\7ASC X12 downloads must be made available to any party, 
including a value added network (VAN). A VAN is a communications or 
information system providing an aggregation, routing, and delivery 
service. In effect, a VAN provides a user with an electronic mailbox 
for receiving information.
---------------------------------------------------------------------------

    Tenneco argues no implementation date for ASC X12 be set, 
contending implementation should occur when trading partners agree. As 
the comments suggest, EBB operators need lead time to modify their 
system to incorporate ASC X12 downloads. The Commission, therefore, 
concludes it needs to set a date by which ASC X12 downloads will be 
available to ensure that users wanting this service can obtain it 
expeditiously. As specified by Working Group 4, the details of any 
special arrangements for access to ASC X12 data between the pipeline 
and a trading partner would be worked out between those parties.
    Other commenters address the Commission's proposal to use Gas*Flow 
to prepare the implementation guide. UDC and Tenneco support the use of 
Gas*Flow, but Tenneco suggests the Gas*Flow documentation should be 
submitted to the Working Groups prior to submission to the Commission. 
Columbia Gas believes the Commission's estimate of one month for 
Gas*Flow to prepare the implementation guide is overly optimistic and 
provides too little opportunity for the industry to participate in 
development.
    The Commission expects Gas*Flow to continue its current procedure 
of receiving industry comment on its proposed implementation guide and 
to submit the guide to the Working Groups for their final approval. The 
extension of the implementation date until June 1, 1994, provides 
Gas*Flow with sufficient time to obtain industry input and still 
finalize the implementation guide in time for the industry to meet the 
June 1, 1994 date. Working Groups 1 and 2 and Gas*Flow should 
coordinate their efforts to ensure that any additional revisions made 
by the Working Groups in the data sets are made in sufficient time to 
ensure that EBB operators can implement the ASC X12 downloads by June 
1, 1994. Once the implementation guide is completed, the Commission 
will include the guide with its data sets.
    b. ASCII downloads. A number of commenters contend ASCII downloads 
are not needed to supplement ASC X12.38 They generally argue 
mandating a second download in ASCII format is not worth the increased 
expense and maintain the resources could be better devoted to 
development of ASC X12. They recommend ASCII downloads should remain a 
pipeline option, as proposed by Working Group 4. AER/MRT and Northwest, 
on the other hand, recommend ASCII downloads replace ASC X12, 
contending that ASCII is less costly, and faster and more efficient to 
implement than ASC X12 and that their customers prefer ASCII to ASC 
X12. Others support the Commission's proposal of maintaining ASCII as 
an adjunct to ASC X12 since some users may not have ASC X12 capability 
and ASCII would ensure those users could download the data.39
---------------------------------------------------------------------------

    \3\8Columbia Gas, El Paso (noting software can translate between 
ASCII and ASC X12); Enron, INGAA (ASC X12 is more comprehensive and 
ASCII might not be demanded after ASC X12); National (contending EDI 
software costs only $500), Natural, WEV, and NGSA (customers wanting 
ASCII should have to pay the costs).
    \3\9Brooklyn Union and Process Gas Consumers Group (but noting 
ASCII may be of limited value unless software developers or the 
users themselves develop programs to extract the needed 
information).
---------------------------------------------------------------------------

    The Commission will not substitute ASCII downloads for ASC X12 as 
suggested by Northwest and AER/MRT. Even if ASCII downloads would be 
less expensive to prepare initially, as Northwest and AER/MRT contend, 
the consensus of the industry was to provide for download capability 
using ASC X12 because it provided significant benefits when compared 
with downloads using ASCII format. Some of these benefits include the 
availability of already standardized and well-accepted procedures and 
the concomitant software and businesses available to implement the 
technology. The Commission anticipates that, as ASC X12 is more widely 
used in the gas industry, users will recognize the advantages to using 
ASC X12, as they have in other industries, and it will become the 
industry standard for communication. Nevertheless, to ease the 
transition to ASC X12 for those customers not yet familiar with the ASC 
X12 technology, the Commission will require EBB operators to provide 
for downloading capability in a flat ASCII format as well.
2. Protocols for Communications Software and Hardware, Access 
Requirements, and Log-On Procedures
    Commenters raise questions about the Commission's proposed 
protocols relating to the software and modem speeds used to access 
EBBs, the requirements for obtaining access to EBBs, and the procedures 
and principles for logging-on to computers. Columbia Distribution 
argues the Commission's proposed protocols fail to reflect two 
principles to which the pipelines agreed: the pipelines' recognition of 
the need to develop a mechanism under which users can log-on to 
multiple EBBs with one phone call; and their commitment to work in good 
faith to address other customer concerns, such as log-on procedures, 
additional file transfer options, and other logistical concerns. IPAA 
suggests a standardized basic user interface must be developed, as 
opposed to each pipeline specifying a different communications package.
    Because the statements mentioned by Columbia Distribution reflected 
a goal for future discussions, rather than a consensus on specific 
procedures or principles, the Commission did not include them in its 
current protocols. The Commission recognizes that further 
standardization of access requirements could reduce the burden on users 
which have to access many pipeline EBBs. But Working Group 4 concluded, 
from its review of pipeline EBBs, that adoption of one standard 
communication package for accessing EBBs was made impracticable at this 
time by the proliferation of different hardware and other operating 
considerations used by the various pipeline EBBs.40 Instead, it 
reached consensus on the principle that each EBB operator must provide 
a script detailing its log-on procedures which is compatible with the 
software package used to access the EBB and must provide for file 
downloads through VANs.41 The Commission, therefore, will not 
require further standardization in this area at this time, but will 
leave any such modifications to the continuing Working Group 
deliberations.
---------------------------------------------------------------------------

    \4\0Working Group 4 Report at 6.
    \4\1By using a VAN, a user could have files from multiple 
pipelines delivered to its electronic mailbox, obviating the need to 
log-on to each of the pipelines' EBBs individually.
---------------------------------------------------------------------------

    Columbia Distribution also asserts some pipelines are proposing to 
make electronic contracting mandatory for certain transactions; it 
contends electronic contracting raises legal and business practice 
issues that should be addressed by the Working Groups. Issues regarding 
electronic contracting are legal and policy concerns that have been 
addressed in restructuring or other proceedings42 and are beyond 
the scope of this rulemaking, which focuses on technical issues of how 
to exchange information. The Working Groups have more than enough 
technical issues to consider, and the expertise of these groups lies in 
the technical, not policy, arena.
---------------------------------------------------------------------------

    \4\2See Questar Pipeline Company, 62 FERC 61,192 at 62,307-08, 
aff'd, 64 FERC 61,157 at 62,283-84 (1993); Transcontinental Gas 
Pipe Line Corporation, 65 FERC 61,023 slip op. at 90-93 (1993).
---------------------------------------------------------------------------

    Northwest contends the Commission should not require pipelines to 
support the 2400 baud modem speed because any speed slower than 9600 
baud will place too great a burden on the EBB communication network. It 
recommends each pipeline be able to choose the appropriate modem speed 
so long as it identifies the hardware necessary to access the EBB. 
Working Group 4 reached consensus on the principle that pipelines must 
support a minimum modem speed so all potential users will have 
reasonable access to the EBBs.43 The Commission will not disturb 
the consensus, since Working Group 4's rationale is reasonable and the 
Commission has no data on the impact on user access of permitting 
pipelines to require higher modem speeds.
---------------------------------------------------------------------------

    \4\3Working Group 4 Report at 15.
---------------------------------------------------------------------------

    The Commission recognizes that modem speeds higher than 9600 are in 
use. The Commission is amending the protocols to provide that EBB 
operators supporting such higher modem speeds must comply with the 
recognized national or international standards governing modem 
communication.
    Transco recommends changes to three of the communication protocols. 
First, it argues the Commission should clarify that the requirement for 
24-hour EDI access (protocol ID) is subject to two separate 
contingencies, required periodic maintenance and unpredicted downtime. 
The Commission sees no need to change this language from what was 
proposed by Working Group 4; the possibility of unforseen events 
causing computer problems is well understood and need not be addressed 
separately. Second, Transco contends the Commission's proposed language 
on advance authorization for third-party access to commercially 
sensitive data (protocol IIIA) is unclear because it does not specify 
that the pipeline's customer must provide the authorization.44 The 
Commission agrees that the customer must authorize access to 
commercially sensitive data and will modify this principle accordingly. 
Third, Transco asserts the Commission's proposed language for log-on 
scripts (protocol IVB) does not reflect the principle put forward by 
Working Group 4, because it fails to make clear that the script for 
customized software packages is part of the customized package, not a 
separate software code. The Commission will modify this protocol to 
reflect this principle.
---------------------------------------------------------------------------

    \4\4A pipeline customer might want to authorize an agent to 
obtain commercially sensitive information about the customer, such 
as the customer's nominations, from the EBB.
---------------------------------------------------------------------------

C. Common Codes

1. Introduction
    In the NOPR, the Commission found the post-Order No. 636 business 
environment and the computerization of capacity release transactions 
required the development of common, standardized codes in two areas: 
Codes to identify companies; and common transaction point codes to 
enable shippers to use a single coding structure to identify pipeline 
points, particularly interconnect points between pipelines. Working 
Group 5 had identified, but had not finalized, a process for developing 
both sets of codes. In the NOPR, the Commission stated that it expected 
Working Group 5 to finalize its proposal for common company codes by 
February 1, 1994.
    For common transaction points, Working Group 5 proposed an approach 
in which a third-party (code assignor) would prepare a computerized 
cross-reference table correlating pipelines' proprietary codes (as 
verified and updated by the pipelines) to a common code. Those wanting 
to use the common code would maintain the cross-reference table on 
their computers and could convert proprietary pipeline codes to the 
common code, and vice versa. The Commission was concerned about the 
feasibility of this process, at least in the short term, because 
Working Group 5 had not worked out the details of the approach (such as 
how to select a code assignor, pay for the costs of the initial 
assignment and continued maintenance, or distribute the code) and had 
suggested this process be undertaken by a yet undeveloped gas industry 
standards board. Due to the importance of this issue, the Commission 
gave the Working Group until October 1, 1993, to finalize this approach 
or reach another consensus approach. If no consensus was reached, the 
Commission proposed to select a common code and require the pipelines 
to make the translation to the common code. The Commission requested 
comments on whether it should adopt the PI-GRID code developed by the 
Petroleum Information Corporation or another common code.
    Many commenters support the development of a common code and the 
selection of the PI-GRID code if consensus on an alternative is not 
reached.45 Columbia Distribution and Exxon contend the pipelines, 
not the users, should make the translation. Pipelines contend that 
requiring them to make the translation to the common code would 
increase costs significantly, because it would affect all their 
computer operations, such as those for accounting, scheduling, and 
management, which are based on the use of proprietary codes.46 
They assert Commission selection of the common code could impede the 
cooperative efforts of the industry to date and recommend the 
Commission permit Working Group 5 to continue its efforts.
---------------------------------------------------------------------------

    \4\5Power Generators, NYMEX/EnerSoft, WEV, IPAA, Destec Energy, 
FMA, NGSA, Edison, WEV.
    \4\6Columbia Gas, Enron, INGAA, KGPL, Natural, Transco, Tenneco.
---------------------------------------------------------------------------

    On October 12, 1993, Working Group 5 filed its report which 
detailed its consensus agreement on a code assignor process along the 
lines of its previous proposal. As discussed below, the Commission is 
adopting the Working Group's proposal.
2. The Proposal
    The common code structure proposed by the Working Group would 
consist of two components. The first would be the code number itself, a 
16 digit number, which according to the Working Group, would provide 
the user with some information about each point.47 The second is a 
common code data base consisting of data elements that will be 
associated with each common code. These data elements include such 
information as the name of the point, the owner operator of the point, 
a flow indicator showing the direction of gas flow at the point, and a 
point locator (e.g., geographic coordinates, survey coordinates, or 
line number or mile marker) to be provided when the information is 
available.
---------------------------------------------------------------------------

    \4\7For example, for each non-well facility point, the first two 
numbers indicate the state; the second three, the county; the next 
five a surface location within the state; the next two, the facility 
code; the next two, a sub number identifying components of certain 
types of facilities (e.g., gas plant inlets from tailgates); and the 
final two, a detail number identifying multiple facilities at the 
same location.
---------------------------------------------------------------------------

    Under the proposal, PI-GRID will be the code assignor and will 
provide a copy of the data base to any requestor at a price reflecting 
only its distribution and handling costs. The Working Group also 
proposes that various Code Distributors will enter into agreements with 
PI-GRID to distribute the code. These agreements would provide that the 
Code Distributors would not be able to charge for the data base itself, 
but would be able to charge for other ``value added'' services, such as 
selective extraction of information from the data base.48
---------------------------------------------------------------------------

    \4\8The Working Group envisions a series of contracts, beginning 
with a master agreement between PI-GRID and a consortium of the gas 
industry. If a gas industry standards board eventually is developed, 
it would then take over this contract. PI-GRID would enter into 
contracts based on the master agreement with Code Distributors, and 
the Code Distributors would enter into agreements with users 
specifying the services Distributor will provide.
---------------------------------------------------------------------------

    Based on discussions with PI-GRID, the Working Group anticipates 
six months will be required to establish and validate the common codes 
for a large majority of interstate pipelines. If the industry begins 
the coding process this winter, the Working Group expects the creation 
of a complete common code data base by the 1994-95 winter heating 
season.
    Under the proposal, all business will be transacted with pipelines 
using proprietary codes. Those wanting to use the common code will have 
to program their computers to translate between common and proprietary 
codes to communicate with pipelines. Pipelines will be required to 
verify and validate their proprietary code information to PI-GRID. The 
proposal also provides for ongoing assignment of new transaction points 
and modifications to existing points. The information for these 
revisions must be provided at least ten days before a new or modified 
code goes into effect.
    The Working Group states that, at this point, the demand for common 
codes is unknown; some parties using only one or a small number of 
pipelines may prefer to continue using proprietary codes. Given this 
level of uncertainty, the Working Group contends the code assignor 
process provides a number of benefits compared to a requirement that 
all pipelines adopt a common code. It provides a verified and validated 
common code system to those who need it, while ensuring that the costs 
of using common codes are borne by the users, not those still 
preferring to use proprietary codes. It will provide consistent 
communication between pipelines and customers using proprietary codes, 
avoiding the difficulties that would be created if business 
transactions and other customer contacts employed different coding 
systems. And, it will provide an initial first test of the level of 
demand for, and efficiency of using, a common code. Should a common 
code prove efficient, the Working Group expects the market to evolve to 
the point where common codes will be used for all communications.
3. Comments on the Working Group Filing
    Process Gas Consumers Group and NYMEX/Enersoft raise objections to 
the code assignor process. Process Gas Consumers Group objects to the 
shipper having the responsibility for maintaining a rather large data 
set on its computer and having to develop, or acquire from others, the 
``intelligence'' needed to compare capacity release offers among 
pipelines to identify possible alternative transportation paths.49 
It maintains that the most burdensome task facing pipelines is 
verifying their proprietary codes and that including the common code in 
the capacity release data sets would not be particularly burdensome. It 
emphasizes that including such codes in the data sets would be for 
informational purposes only, and would not require the pipelines to 
conduct business using the common codes.
---------------------------------------------------------------------------

    \4\9It also suggests that a common code system could include 
mile markers or other geographic location information so software 
could identify delivery points either upstream or downstream of a 
location.
---------------------------------------------------------------------------

    NYMEX/EnerSoft contend pipelines should not be able to require 
customers to communicate using proprietary codes, because users will 
then have to obtain translation software to convert the common codes to 
the proprietary codes. It maintains that having the pipelines perform 
the translation is preferable since there are fewer pipelines than 
market participants.
    The other commenters support the code assignor process. AER/MRT 
supports the use of proprietary codes for communication between 
pipelines and users, because use of one code will minimize the 
likelihood of miscommunication. It also argues requiring shippers to 
perform the translation appropriately requires those using common codes 
to bear the costs of that use. Gaslantic contends the Commission should 
ensure that initial and updated common codes are distributed on an 
open-access basis, and IPAA similarly supports the provision of the 
data base without cost.
    The National Registry suggests two clarifications. It is concerned 
about the possibility that PI-GRID, as code assignor, might delay 
distribution of the code in order to degrade the value of services 
provided by competitors. It suggests PI-GRID should be required to file 
a letter with the Commission when it has completed more than 90% of the 
cross-referencing for each pipeline and provide the code to 
distributors at that point. It further contends that information on the 
location of points (such as geographic coordinates or pipeline line 
number of mile marker) is critical, but that the proposed data sets 
requires this information to be included only when available. It 
maintains the Commission should clarify when this information must be 
provided, suggesting it should be supplied for path pipelines, but not 
for point-to-point or network pipelines.50 In line with this 
request, it suggests the Commission require pipelines to include in 
their next Form 567 filing an identification of the proprietary point 
code associated with the points in the flow diagrams.51
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    \5\0It similarly seeks clarification that available information 
will be validated and become part of the cross-reference table.
    \5\1Form No. 567 is diagram of the operating conditions on the 
pipeline's main transmission system for the prior year. 18 CFR 
260.8.
---------------------------------------------------------------------------

4. Commission Adoption of the Working Group Proposal
    Given the level of support for the code assignor process, the 
Commission accepts the Working Group proposal and will implement it by 
requiring pipelines to provide a mechanism through which any person can 
obtain a validated computerized data base that will provide the ability 
to convert from pipeline proprietary codes to a common code. The 
Working Group stated the code assignment process could be completed by 
the start of the 1994-95 winter heating season, and the Commission, 
therefore, will require the implementation of this approach by November 
1, 1994. The Commission also will require pipelines to ensure that the 
common codes and data base, and any updates, will be provided without 
charge, except for reasonable distribution and handling fees.
    The Commission will adopt the data sets as proposed by the Working 
Group with one modification. The Commission will require that the point 
locator information be mandatory. The Commission agrees with the 
commenters that the ability to locate pipeline points in relation to 
other points on the system is important if users are to use the common 
code data base to determine if a package of released capacity fits 
their needs. When pipelines verify their proprietary codes to PI-GRID, 
they must include information sufficient to enable users to locate a 
point on one pipeline in relation to other points. At this point, the 
pipelines can choose the method of locating the points, such as 
geographic coordinates, line number or line marker, but the Commission 
envisions that eventually all pipelines should move to using geographic 
coordinates so that points on different pipelines can be related to 
each other.
    Gaslantic and IPAA support the provision of the data base and 
updates at no cost to the user. The Working Group report states 
distributors cannot charge more than postage and handling costs for 
providing the code itself, but can charge for value added services. The 
Commission is requiring the pipelines to ensure that users can obtain 
the data base and any updates at a price that reflects only reasonable 
costs of distribution and handling. Additional charges, however, may be 
assessed for other value added services relating to updates.
    The requirement that point locator information be mandatory for all 
pipelines obviates the requests by the National Registry for a further 
definition of the term ``available'' to describe when point locator 
information will be provided and for requiring point location 
disclosure in Form 567 filings. The provision of point locator 
information also should satisfy Process Gas Consumers Group's request 
for geographic location points.
    The National Registry suggests that the Commission require PI-GRID 
to file a statement with the Commission when it has completed more than 
90% of the cross-referencing for each pipeline and provide the code to 
distributors at that point. The Commission has set a deadline for final 
dissemination of the common code data base and finds no reason to 
require filings as the data are compiled or piecemeal implementation.
    NYMEX/Enersoft contend pipelines should be required to conduct 
business using common codes. The Commission will not impose this 
requirement at this time, since it goes beyond the consensus agreement 
reached by Working Group 5. Shippers will be able to use the cross-
reference table to convert electronically from the common codes to the 
proprietary codes for communication with the pipeline.
    Process Gas Consumers Group maintains that including the common 
codes in the capacity release data sets would be more efficient, 
although they do not suggest pipelines be required to conduct business 
using the common code. This suggestion too goes beyond the consensus 
agreement reached by the Working Groups, and the Commission will not 
impose it.
    Moreover, even if the common code (consisting of 16 digits) was 
included in the capacity release data sets, the efficiency of the 
process might not be enhanced to a significant degree. The extensive 
data base that goes along with the common code would not be on the 
EBBs, and users may very well need the underlying data base to provide 
the information they require to perform an analysis of capacity paths. 
As described earlier, the sequence of numbers in the code itself 
provides users only with limited information, such as identifying the 
state and county of the point. But the entire common code data base 
provides additional information about points, such as the point locator 
information, that users may well need to use the common code 
effectively in comparing capacity releases over multiple pipelines. The 
Commission further notes that Working Groups 1 and 2 have included an 
optional field for common codes which pipelines may make available to 
their users. Use of this field may provide a test of whether bidders 
would derive value from access to the common code numbers, without also 
having the underlying data base available.
    In conclusion, the Commission finds that the industry has taken a 
positive step forward by designing a process that will ensure that 
those wanting to use common codes can do so effectively within a 
reasonable period of time. The Commission expects use of this system 
will prove to enhance efficiency by better enabling shippers to manage 
the transportation of gas supplies across the nationwide pipeline grid. 
As pipelines review and update their computer and financial systems in 
light of the changed business environment created by Order No. 636, the 
Commission expects them to incorporate the use of common codes. 
Ultimately, the Commission anticipates that the common codes ultimately 
will become the standard used for all transactions and communications 
between pipelines and their customers.

VII. Issues not Addressed in the Standardized Data Sets and 
Communication Protocols

    The Working Group reports included minority positions on some 
issues, and these issues also were addressed in the comments on the 
Working Group reports. On several issues, the Commission recommended 
that the Working Groups continue their efforts to seek resolution, with 
reports to be made by February 1, 1994. Others involved policy 
questions which the Commission found were beyond the scope of this 
proceeding and would be better examined in other fora.

A. Proposed Additions to the Standardized Data Sets

1. Index of Purchasers
    The National Registry proposed that an Index of Purchasers (Index), 
which would disclose a variety of information about the capacity rights 
of firm capacity holders, be available on EBBs and through downloadable 
files.52 It asserted this index could be used to establish the 
baseline contractual rights of current holders of pipeline capacity, 
information which it believed was needed so potential purchasers could 
determine the releasable rights of firm capacity holders. In the NOPR, 
the Commission did not propose to include the proposed Index because 
the proposal appeared too burdensome and costly. But the Commission 
stated it considered a more limited Index to have value in identifying 
firm shippers with releasable capacity. It suggested the Working Groups 
work on a cost-effective method of presenting such information.
---------------------------------------------------------------------------

    \5\2The Commission requires pipeline tariffs to include an index 
of firm capacity holders, with less detail than what was proposed by 
the National Registry. Tennessee Gas Pipeline Company, 65 FERC 
61,224 slip op. at 182 (1993); 18 CFR 154.41.
---------------------------------------------------------------------------

    Many commenters contend the benefits of an Index do not warrant the 
cost, since shippers willing to release capacity are free to post 
offers to sell and potential purchasers can post so-called want ads, 
advertising the capacity they want to acquire.53 INGAA suggests 
the Commission not prejudge the outcome of this issue, but instead 
permit the Working Group process to determine whether an Index in any 
form is appropriate.
---------------------------------------------------------------------------

    \5\3AER/MRT, Columbia Distribution, Con Edison (if Index is 
adopted, it should be operated independently and funded by 
subscribers), Enron (too costly and burdensome); KGPL, Natural, UDC, 
Williston Basin.
---------------------------------------------------------------------------

    Others contend an Index would be valuable in providing convenient 
access to baseline information on those holding firm service so buyers 
could determine whom to approach to negotiate prearranged deals for 
capacity.54 They contend the Index would replace the index of 
sales customers pipelines previously maintained and should not be 
difficult for pipelines to provide.
---------------------------------------------------------------------------

    \5\4FMA, IPAA, NGSA.
---------------------------------------------------------------------------

    The Commission will not decide this issue now because it is still 
being considered by the Working Groups. But the Commission continues to 
find merit in the concept of providing a cost-effective electronic 
Index of purchasers and expects the participants in the Working Groups 
to consider this issue in the same open-minded and conciliatory manner 
they used to build consensus on other issues in this proceeding.
    The Commission also did not propose to make data items for contract 
number and replacement contract number mandatory fields, finding that 
these items were tied to the proposed Index.\55\ The National Registry 
contends its request to make contract and replacement contract numbers 
mandatory fields is independent of the Index. It asserts these data are 
needed by the Commission, state commissions, and others to create an 
audit trail to verify the ownership of capacity being released and 
acquired.
---------------------------------------------------------------------------

    \55\The releaser's contract number is an optional field and so 
may be included by pipelines when they deem such information to be 
necessary for operation of their systems.
---------------------------------------------------------------------------

    Although the Commission will not require the inclusion of contract 
and replacement contract number in the data sets at this time, it does 
recognize that pipelines will need to maintain a correlation between 
release transactions and the contracts resulting from those 
transactions for Commission audit requirements if not also for the 
pipelines' own purposes. Since pipelines must maintain this information 
in any event, the Working Groups should consider making this 
information mandatory in the downloadable data sets to make access 
easier.
2. Nominations for Firm and Interruptible Capacity
    No consensus was reached in the Working Groups whether to include 
fields showing confirmed firm and interruptible nominations and a field 
showing whether no-notice service is available at a location. 
Proponents of providing this information contended it was needed for 
releasing shippers and bidders to assess the value of released 
capacity, while opponents maintained it is not needed to bid on 
capacity, but would unfairly tilt the market in favor of bidders. The 
parties also disagreed on the availability, and costs, of providing the 
information.
    In the NOPR, the Commission found that the available information 
did not permit it to resolve the issue. Moreover, the Commission 
recognized the Working Groups had little time to consider this matter 
fully and, therefore, strongly encouraged them to continue their 
discussions and to explore alternatives for providing information 
relevant to the purchasing of capacity that is operationally feasible 
to provide at reasonable cost.
    The comments on the NOPR essentially parallel the previous 
positions: proponents state the information is needed to make business 
judgments and is information that would be available in a free 
market;\56\ opponents contend it would undermine capacity release, is 
too costly to provide, would not be provided in a free market, and 
unfairly requires shippers to divulge competitive information that 
would be used against them.\57\ NGSA and Destec Energy comment that the 
Commission must be prepared to judge the merits of disputes, like this 
one, which are based on competing economic interests. FMA asserts that 
for unresolved disputes, special consideration should be given to the 
views of end-users, because they are the ones paying for natural gas 
and transportation.
---------------------------------------------------------------------------

    \56\Power Generators, Destec Energy, FMA, Edison.
    \57\Columbia Distribution, Con Edison, Enron, KGPL, National, 
Natural, Transco, and UDC.
---------------------------------------------------------------------------

    The Commission finds that the Working Groups should continue to 
examine and explore means of reaching a compromise on this issue. The 
Commission does not agree that the views of any one group should 
predominate over others. The parties should seek to accommodate each 
other's interests, as they have on other issues, a process more likely 
to produce a resolution preferable to both sides than if the Commission 
decides. Should agreement on whether to provide the information prove 
elusive, the parties should, at a minimum, seek to agree upon a cost 
effective method of providing the information if the Commission 
determines it is necessary.

B. Communication Protocols for Uploading Files and Downloading Subsets 
of Files

    In the NOPR, the Commission stated that development of standards 
permitting users to transmit (upload) files to the pipelines' computers 
as well as to download subsets of files could increase the efficiency 
of the capacity allocation mechanism. File upload capability, for 
example, would permit bidders to submit their bids electronically 
without having to sign-on to the pipelines' on-line EBBs. The ability 
to download a subset of a capacity release file, such as release 
information received after a certain date, would permit users to 
eliminate unneeded information from the files they download and also 
increase the efficiency of the communication process. The Commission 
endorsed Working Group 4's plan to continue its efforts to develop 
these capabilities.
    Many commenters support file uploading to provide efficient 
communication.\58\ Others, principally pipelines, raise questions about 
file uploading. They contend file uploading is not as well suited as 
on-line EBBs to handling bids submitted near the close of bidding 
periods, because, unlike EBBs, uploading is not an interactive system 
permitting immediate notification to bidders of errors in their 
bids.\59\
---------------------------------------------------------------------------

    \58\Power Generators, Columbia Distribution, Con Edison, NYMEX/
EnerSoft, Edison, Tenneco (noting effort should not be 
oversimplified), WEV, and Williston Basin (noting uploads must be 
coordinated with interactive EBBs, especially at the end of bidding 
periods when quick action is needed).
    \59\El Paso, Natural, Transco, Northwest, KGPL, National (also 
may expose pipelines' computers to security risks, such as viruses).
---------------------------------------------------------------------------

    Edison states downloading of file subsets should be a priority. 
Columbia Gas maintains downloads of subsets based on dates is 
reasonable, but adding other criteria could be burdensome, while 
Williston Basin contends any subset downloads would be too expensive. 
UDC suggests the Commission should not mandate file uploading or 
downloading of file subsets, but should trust the market to develop 
these capabilities if they are needed.
    The Commission is convinced that the development of effective file 
uploading and subset downloading capability would markedly enhance 
communication efficiency related to capacity release. Working Group 4 
should continue to assign a high priority to developing standards in 
this area. The Commission recognizes the concerns with uploads 
submitted close to the end of the bidding period, but is confident the 
Working Groups can develop the necessary standards to deal with this 
issue.\60\
---------------------------------------------------------------------------

    \60\For example, one possible approach the Working Groups could 
consider is whether all bids received within some time period prior 
to the close of the bidding period should be treated as having been 
received at the same time.
---------------------------------------------------------------------------

C. Standardization of Non-Capacity Release Business Transactions

    The industry established Working Group 3 to consider the 
development of standards relating to business practices, other than 
capacity release, resulting from the business changes fostered by 
pipeline restructuring under Order No. 636. In its report, the Working 
Group did not propose any standards; it outlined the areas of highest 
priority and its process for continuing to examine these issues. 
Several commenters support the continuation of these efforts, 
maintaining standardization of these business data is critically 
important to the industry.\61\ Vesta contends the Commission should 
require the pipelines now to provide the 16 data items tentatively 
established by Working Group 3 as being the most critical. Others 
oppose the continuation of Working Group 3's deliberations, arguing 
standards in these areas are not required by Order No. 636 and the 
Commission should limit its promulgation of standards to those 
essential for capacity release.\62\
---------------------------------------------------------------------------

    \61\Exxon, NGSA, O&R.
    \62\PEC Pipeline Group, UDC, Tenneco.
---------------------------------------------------------------------------

    The Commission has recognized the restructuring occasioned by Order 
No. 636 likely will result in changes to business practices, apart from 
capacity release, which could require further standardization.\63\ 
Standardizing capacity release information was the first step in this 
process, but now the Working Groups should turn their attention to 
standards for these other business transactions.
---------------------------------------------------------------------------

    \63\See Order No. 636-A, III FERC Stats. & Regs. Preambles at 
30,459 (standards may be needed to ensure efficient movement of gas 
across pipelines); March 10, 1993, Notice (capacity release 
standards first step in standardization).
---------------------------------------------------------------------------

    From over 66 items proposed for review, Working Group 3 found 33 to 
be of high priority, and of those 33, focused its initial review on ten 
elements.\64\ In the Commission's view, standardization of these ten, 
or most of them, would provide a good departure point for this effort. 
The Commission realizes all facets of the industry may not have equal 
need for all these elements, but these elements would appear to have 
wide enough coverage that the benefits from standardization will be 
widespread. Moreover, once standards are in place, those who may not 
now perceive a need for standards, may come to realize the standards 
will make their business more efficient, and even those who do not need 
the standards themselves, stand to benefit if other segments of the 
industry become more efficient.\65\ The Working Group should propose an 
appropriate implementation schedule for the ten identified data 
elements. The Working Group also should continue its efforts to 
identify which of the remaining 23 high priority data elements, as well 
as any others, require standardization and propose a schedule for 
implementation of standards for these elements as well.
---------------------------------------------------------------------------

    \64\The ten elements were: timely flowing volume; timely volume 
allocation reports; predetermined allocations and shipper ranking; 
imbalance status; customer scheduled receipts and deliveries; 
customer specific curtailment/interruption information; customer 
specific operational flow orders; daily nominated volume 
acknowledgement; customer penalty status; and input and modify gas 
nominations. Working Group 3 Report at 5-6.
    \65\For example, if standards reduce producers' costs or result 
in making gas a more viable option for fuel switchable users, all 
will benefit from lower prices and greater use of the gas 
transportation system.
---------------------------------------------------------------------------

D. Policy Issues

    The minority reports and initial comments raised questions about 
three policy issues: the method of recovering the costs of 
standardization, pipeline disclaimers of liability for EBB operation, 
and the disclosure of non-price considerations underlying capacity 
release transactions. The Commission stated in the NOPR that such 
substantive policy issues are beyond the scope of this proceeding and 
are more appropriately considered in individual proceedings.
1. Costs of Standardization
    In the NOPR, the Commission recognized the concern of firm shippers 
that the costs of compliance with the EBB standards should be spread 
equitably across all those benefitting from the standards. The 
Commission encouraged the industry to consider methods for ensuring 
equitable sharing of such costs, such as user or access fees.
    Many commenters support development of a fair and equitable method 
of allocating costs.\66\ Transco and Williston Basin maintain EDI, in 
particular, is not suitable for all customers and suggest the costs of 
implementing this technology should be borne by those benefitting from 
it. PSCW contends LDCs should not have to subsidize the costs of 
providing information benefitting other parties and suggests an 
incremental pricing system for all information beyond a basic level. A 
number of commenters are concerned about leaving the issue solely to 
rate cases.\67\ They maintain the policy needs to be consistent across 
pipelines and urge the Commission to decide on the method for 
allocating costs in this proceeding or in another generic proceeding, 
leaving implementation to individual rate cases. Power Generators 
opposes inclusion of this issue in the Working Groups, because the 
success of the Groups was due to their focus on technical issues.
---------------------------------------------------------------------------

    \66\AGA. UDC, WEV.
    \67\AER/MRT, Brooklyn Union, Columbia Distribution, UDC.
---------------------------------------------------------------------------

    El Paso, Tenneco, and INGAA contend user or access fees are not 
appropriate for recovery of upfront costs, and Natural expresses 
concern that access fees may not be sufficient to compensate 
pipelines.68 FMA suggests, in the absence of consensus on a new 
approach, the proper approach is to continue with the Order No. 636 
policy of recovering fixed costs through reservation charges and only 
variable costs through usage charges.
---------------------------------------------------------------------------

    \6\8INGAA suggests direct charges may be appropriate for 
additional services and features that go beyond the standards to be 
adopted by the Commission.
---------------------------------------------------------------------------

    In general, the Commission finds that its previous policy of 
permitting the pipelines to recover fixed costs through a reservation 
charge and only variable costs through a usage charge is appropriate 
for the basic EBB service. This basic service includes, at a minimum, 
the downloadable data sets and communication protocols established in 
this rule, which the Commission finds are necessary to promote a viable 
capacity release market and should provide generalized system-wide 
benefits to all users of the pipeline grid. Until additional standards 
are presented, the Commission cannot determine whether they provide 
sufficient benefits to the industry as a whole to warrant inclusion in 
the basic EBB package.
    For enhancements to the basic EBB service, which are not of general 
benefit, the Commission is open to considering cost recovery approaches 
that will recover fixed costs from the limited number of users deriving 
benefit from the service. The Commission encourages the industry to 
pursue such approaches.
    As an example, pipelines could consider using a process for 
recovering the costs of enhancements to the standard EBB package from 
only those customers that subscribe to the enhancements. The pipeline 
could explore with the users of its EBB the costs of providing a 
particular service or group of services and methods of recovering these 
costs from the subscribing users, such as through access fees, 
reservation charges, or direct charges. The pipeline and the users also 
could establish mechanisms for reimbursing the initial subscribers if 
additional users later evince an interest in obtaining the services. 
Once having obtained agreement from those customers desiring the 
service, the pipeline could make a tariff filing to establish the 
method of recovery or submit an application or petition for a 
declaratory order requesting advance Commission review of the proposed 
costs and charges.69
---------------------------------------------------------------------------

    \6\918 CFR 385.204, 385.207. This process would be similar to 
the advance approval for research, development, and demonstration 
projects. 18 CFR 154.38(d)(5).
---------------------------------------------------------------------------

2. Liability
    Several commenters suggest the liability standard for EBB 
operations should be the same across all pipelines and, therefore, 
should be resolved either in this proceeding or in another generic 
proceeding.70 Peoples Gas, et al., supports consideration of the 
issue in individual proceedings, but suggests the Commission restate 
here its standard that pipeline liability for EBB operations should be 
no different than for other operations. UDC asks the Commission to 
state that it will enforce its standard. Some parties contend the 
Commission should adopt a new standard, arguing EBBs are not like other 
pipeline operations since parties other than the pipeline are 
responsible for providing information.71 Because verification of 
such information is time consuming, they recommend each party ensure 
the accuracy of the information it provides. Con Edison, in contrast, 
argues that pipeline tariff provisions regarding EBB user 
indemnification of the pipeline are too onerous and hold the EBB user 
to a higher standard of responsibility than applies to the pipeline. 
Enron contends the issue is beyond the scope of this proceeding.
---------------------------------------------------------------------------

    \7\0Columbia Distribution, Con Edison, NGSA, NYMEX/EnerSoft.
    \7\1Tenneco, Con Edison, NYSEG, WEV (knowingly providing false 
information should subject provider to damages).
---------------------------------------------------------------------------

    The Commission agrees that this issue goes beyond the technical 
concerns with standards development which were the focus of this 
proceeding. The Commission can determine policy related issues in 
individual cases without having to establish a new generic proceeding 
and already has addressed this issue in restructuring orders. The 
Commission has adopted the principle that a pipeline's liability for 
EBB operations should be the same as for its other operations.72 
The Commission also has addressed user liability standards in 
individual restructuring orders based upon the specific pipeline EBB 
agreement.73 In general, the Commission has determined that a 
user's liability for unauthorized use of a customer identification 
number is limited to negligence or a wrongful act.
---------------------------------------------------------------------------

    \7\2Algonquin Gas Transmission Company, 65 FERC 61,019 slip op. 
at 23-24 (1993); Great Lakes Gas Transmission Limited Partnership, 
65 FERC 61,004 slip op. at 29-30 (1993).
    \7\3South Georgia Natural Gas Company, 64 FERC 61,251 slip op. 
11-12 (1993); East Tennessee Natural Gas Company, 65 FERC 61,223 
(1993).
---------------------------------------------------------------------------

3. Non-Price Considerations
    O&R contends standards are needed to guard against capacity 
releases involving deals for indirect consideration, such as capacity 
release transactions tied to gas supply arrangements. It asserts this 
issue is not better addressed in individual proceedings, but requires a 
definitive policy statement. The Commission adheres to its conclusion 
that this issue is outside the scope of this technical rulemaking and 
should not be an issue considered by the continuing Working Group 
sessions. The Commission has addressed this concern in individual 
restructuring proceedings based on the facts and circumstances in each 
case.74 As pointed out previously, should the Commission decide a 
general policy in this area is required in the future, the Commission 
need not articulate its policy through a generic proceeding, but can do 
so in individual proceedings.
---------------------------------------------------------------------------

    \7\4See Northwest Pipeline Corporation, 63 FERC 61,124 at 
61,803 (1993); Pacific Gas Transmission Company, 64 FERC  61,052 at 
61,455-56 (1993).
---------------------------------------------------------------------------

E. Gas Industry Standards Board

    Several of the Working Group reports, and initial comments, 
endorsed the development of a Gas Industry Standards Board (GISB) which 
ultimately would replace the Working Groups and continue the 
development and maintenance of industry-wide standards. In the NOPR, 
the Commission stated it was interested in this concept and invited 
submission of a proposal as to how it would operate.
    Many commenters support an industry standards board in concept as 
long as all industry segments are represented, but noted the concept is 
still in the planning phase so any detailed comments would be 
premature.75 A number of commenters emphasized that the GISB 
concept should not interfere with the on-going efforts of the Working 
Groups. El Paso did not support an industry standards board unless it 
was limited to communication format standards, and O&R contended such a 
board should be an advisory panel only. Con Edison, in contrast, 
contends the scope of the board should be extended beyond electronic 
communication to include standardization relating to pipeline 
operations, imbalances, and nominations.
---------------------------------------------------------------------------

    \7\5See Power Generators, Northwest, Tenneco, Williston Basin, 
AGA, AER/MRT, AGD, Brooklyn Union, Columbia Distribution, Columbia 
Gas, Destec Energy, Exxon, NGSA, Process Gas Consumers Group , IPAA, 
KGPL, Transco, UDC, Natural, Peoples Gas, et al., Edison, Texaco, 
PEC Pipeline Group.
---------------------------------------------------------------------------

    On November 2, 1993, the Commission met with representatives from 
the Natural Gas Council to hear a report on the progress of GISB. The 
Commission remains interested in this concept and looks forward to a 
detailed proposal. When the Commission receives a proposal, it will 
give close consideration to the effects of such an independent industry 
standardization effort on all facets of the gas industry, Commission 
regulation, and state regulation.
    In the meantime, the Working Group efforts should continue apace. 
The Working Groups should not defer or delay the development of 
standards in anticipation of the formation of a standards board. 
Moreover, they should ensure their proposals can stand alone and should 
not rely upon the eventual existence of a standards board as the means 
to administer the standards.

VIII. Environmental Analysis

    The Commission is required to prepare an Environmental Assessment 
or an Environmental Impact Statement for any action that may have a 
significant adverse effect on the human environment.76 The 
Commission has categorically excluded certain actions from these 
requirements as not having a significant effect on the human 
environment.77 The action taken here falls within the categorical 
exclusions in the Commission's regulations for rules that are 
clarifying or procedural and that relate to information gathering, 
analysis, and dissemination.78 Therefore, an environmental 
assessment is unnecessary and has not been prepared in this rulemaking.
---------------------------------------------------------------------------

    \7\6Order No. 486, Regulations Implementing the National 
Environmental Policy Act, 52 FR 47897 (Dec. 17, 1987), FERC Stats. & 
Regs. Preambles 1986-1990  30 (1987).
    \7\718 CFR 380.4.
    \7\8See 18 CFR 380.4(a)(2)(ii), 380.4(a)(5).
---------------------------------------------------------------------------

IX. Regulatory Flexibility Act Certification

    The Regulatory Flexibility Act of 1980 (RFA)79 generally 
requires a description and analysis of final rules that will have 
significant economic impact on a substantial number of small entities. 
Pursuant to section 605(b) of the RFA, the Commission hereby certifies 
that the regulations proposed herein will not have a significant impact 
on a substantial number of small entities.
---------------------------------------------------------------------------

    \7\95 U.S.C. 601-612.
---------------------------------------------------------------------------

X. Information Collection Requirement

    Office of Management and Budget (OMB) regulations require approval 
of certain information collection requirements imposed by agency 
rules.80 The information/EBB requirements of this final rule are 
under FERC-549(B), Gas Pipeline Rates: Capacity Release Information, 
(OMB Control No. 1902-0169).
---------------------------------------------------------------------------

    \8\05 CFR 1320.14.
---------------------------------------------------------------------------

    The required information under FERC-549(A) enables the Commission 
to carry out its legislative mandate under the NGA and NGPA and will 
ensure a viable capacity release market under Commission Order No. 636. 
Specifically, the required information allows the Commission to review/
monitor capacity release transactions and firm and interruptible 
capacity made available directly from pipelines and to take appropriate 
action, where and when necessary.
    The Commission is submitting notification of these information/EBB 
requirements to OMB for its review and approval. Interested persons may 
send comments regarding the burden estimates or any other aspect of 
these EBB standards/information requirements, including suggestions for 
reducing the estimated burden, by contacting the Federal Energy 
Regulatory Commission, 941 North Capitol Street, NE., Washington, DC 
20426 [Attention: Michael Miller, Information Services Division, (202) 
208-1415]. Comments on the requirements of the subject final rule may 
also be sent to the Office of Information and Regulatory Affairs, 
Office of Management and Budget, Washington, DC 20503 [Attention: Desk 
Officer for Federal Energy Regulatory Commission].

XI. Effective Date

    This final rule shall take effect February 4, 1994.

List of Subjects in 18 CFR Part 284

    Continental shelf, Natural gas, Reporting and recordkeeping 
requirements.

    By the Commission.
Lois D. Cashell,
Secretary.

    In consideration of the foregoing, part 284, chapter I, title 18, 
Code of Federal Regulations, is amended as set forth below.

PART 284--CERTAIN SALES AND TRANSPORTATION OF NATURAL GAS UNDER THE 
NATURAL GAS POLICY ACT OF 1978 AND RELATED AUTHORITIES

    1. The authority citation for part 284 continues to read as 
follows:

    Authority: 15 U.S.C. 717-717w, 3301-3432; 42 U.S.C. 7101-7532; 
43 U.S.C. 1331-1356.

    2. In Sec. 284.8, paragraph (b)(5) is redesignated paragraph (b)(6) 
and new paragraph 284.8(b)(5) is added to read as follows:


Sec. 284.8  Firm transportation service.

* * * * *
    (b) * * *
    (5) Standardization of information provided on Electronic Bulletin 
Boards.
    (i) An interstate pipeline must provide access to standardized 
information relevant to the availability of service on its system on 
its Electronic Bulletin Board and through downloadable files in 
compliance with standardized communication protocols. The standardized 
information and the communication protocols are found in ``Standardized 
Data Sets And Communication Protocols,'' which can be obtained from the 
Public Reference and Files Maintenance Branch, Federal Energy 
Regulatory Commission, 941 North Capitol Street NE., Washington DC 
20426.
    (ii) An interstate pipeline must implement these standards, 
procedures, and protocols by June 1, 1994, unless the Standardized Data 
Sets And Communication Protocols specify an implementation date.
* * * * *
    3. In Sec. 284.9, paragraph (b)(4) is revised to read as follows:


Sec. 284.9  Interruptible transportation service.

* * * * *
    (b) * * *
    (4) The requirement of paragraph (b)(3) of this section must be 
implemented through the use of an Electronic Bulletin Board with the 
features required under Sec. 284.8(b)(4) and complying with 
Sec. 284.8(b)(5).
* * * * *
    Note: This Appendix will not appear in the Code of Federal 
Regulations.

Appendix A--Parties Filing Comments on the Notice of Proposed 
Rulemaking

Docket No. RM93-4-000


------------------------------------------------------------------------
                     Commenter                           Abbreviation   
------------------------------------------------------------------------
Ad Hoc Group of Power Generators\81\ and Edison      Power Generators.  
 Electric Institute.                                                    
American Gas Association...........................  AGA.               
ANR Pipeline Company and Colorado Interstate Gas     ANR/CIG.           
 Company.                                                               
Arkla Energy Resources Company and Mississippi       AER/MRT.           
 River Transmission Corporation.                                        
Associated Gas Distributors........................  AGD.               
Brooklyn Union Gas Company.........................  Brooklyn Union.    
Columbia Gas Distribution Companies\82\............  Columbia           
                                                      Distribution.     
Columbia Gas Transmission Corporation and Columbia   Columbia Gas.      
 Gulf Transmission Company.                                             
Consolidated Edison Company of New York, Inc.......  Con Edison.        
Destec Energy, Inc.................................  Destec Energy.     
El Paso Natural Gas Company........................  El Paso.           
Enron Interstate Pipelines (Northern Natural Gas     Enron.             
 Company, Transwestern Pipeline Company, and                            
 Florida Gas Transmission Company).                                     
Exxon Corporation..................................  Exxon.             
Fuel Managers Association..........................  FMA.               
Hadson Gas Systems, Inc............................  Hadson.            
Independent Petroleum Association of America.......  IPAA.              
Interstate Natural Gas Association of America......  INGAA.             
Koch Gateway Pipeline Company......................  KGPL.              
National Fuel Gas Supply Corporation...............  National.          
National Registry of Capacity Rights...............  National Registry. 
Natural Gas Pipeline Company of America............  Natural.           
Natural Gas Supply Association.....................  NGSA.              
New York Mercantile Exchange and Enersoft            NYMEX/EnerSoft.    
 Corporation.                                                           
New York State Electric & Gas Corporation..........  NYSEG.             
Northwest Pipeline Corporation.....................  Northwest.         
O&R Energy, Inc....................................  O&R.               
Peoples Gas Light and Coke Company, North Shore Gas  Peoples Gas, et al.
 Company, and Northern Illinois Gas Company.                            
Process Gas Consumers Group, American Iron and       Process Gas        
 Steel Institute, and Georgia Industrial Group.       Consumers Group.  
Public Service Commission of Wisconsin.............  PSCW.              
Sabine Pipe Line Company...........................  Sabine.            
Southern California Edison Company.................  Edison.            
Tenneco Gas........................................  Tenneco.           
Texaco, Inc........................................  Texaco.            
Texas Eastern Transmission Corporation, Panhandle    PEC Pipeline Group.
 Eastern Pipe Line Company, Trunkline Gas Company,                      
 and Algonquin Gas Transmission Company.                                
Transcontinental Gas Pipe Line Corporation.........  Transco.           
UGI Utilities, Inc.................................  UGI.               
United Distribution Companies......................  UDC.               
Vesta Energy Company...............................  Vesta.             
Williams Energy Ventures, Inc......................  WEV.               
Williston Basin Interstate Pipeline Company........  Williston Basin.   
------------------------------------------------------------------------
\81\This group includes American Electric Power Service Corporation,    
  Atlantic City Electric Company, Boston Edison Company, Energy Service,
  Inc., Fuel Managers Association, New England Power Service Company,   
  Northern States Power Company, Northeast Utilities, Potomac Electric  
  Power Company, Southern Company Services, Virginia Electric and Power 
  Company, West Texas Utilities Company, and Wisconsin Electric Power   
  Company.                                                              
\82\Columbia Gas of Kentucky, Inc., Columbia Gas of Maryland, Inc.,     
  Columbia Gas of Ohio, Inc., Columbia Gas of Pennsylvania, Inc., and   
  Commonwealth Gas Services, Inc.                                       


[FR Doc. 94-45 Filed 1-4-94; 8:45 am]
BILLING CODE 6717-01-P