[Federal Register Volume 60, Number 88 (Monday, May 8, 1995)]
[Rules and Regulations]
[Pages 22503-22505]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-11213]



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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Parts 2, 34, 35, 41, 131, 292, 294, 382, and 385

[Docket No. RM92-12-001; Order No. 575-A]


Streamlining of Regulations Pertaining to Parts II and III of the 
Federal Power Act and the Public Utility Regulatory Policies Act of 
1978

Issued May 2, 1995.
AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Final rule; Order Granting and Dismissing Requests for 
Clarification and Dismissing Requests for Rehearing.

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SUMMARY: The Federal Energy Regulatory Commission (Commission) is 
granting and dismissing certain requests for clarification of its final 
rule in this proceeding and dismissing requests for rehearing. The 
requests for clarification and for rehearing relate to the Commission's 
description of petroleum coke and to codification of Commission 
precedent regarding the power production capacity of qualifying 
facilities.

EFFECTIVE DATE: This order is effective May 2, 1995.

FOR FURTHER INFORMATION CONTACT:
Andre Goodson, Office of the General Counsel, Federal Energy Regulatory 
Commission, 825 North Capitol St., NE., Washington, DC 20426, 
Telephone: (202) 208-2167.
Joseph C. Lynch, Federal Energy Regulatory Commission, Office of the 
General Counsel, 825 North Capitol Street, NE., Washington, DC 20426, 
Telephone: (202) 208-2128.

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 3401, at 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 19200, 14400, 12000, 9600, 7200, 4800, 2400, 1200 or 
300bps, full duplex, no parity, 8 data bits and 1 stop bit. The full 
text of this document will be available on CIPS for 60 days from the 
date of issuance in ASCII and WordPerfect 5.1 format. After 60 days the 
document will be archived, but still accessible. 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.

Order Granting and Dismissing Requests for Clarification and Dismissing 
Requests for Rehearing

    On January 13, 1995, the Commission issued a Final Rule in this 
proceeding.1 The Final Rule revised and clarified the Commission's 
policies regarding: rate filings by public utilities under the Federal 
Power Act (FPA); issuances of securities and assumptions of liabilities 
by public utilities, licensees and others; and procedural and technical 
rules governing qualifying facilities (QFs).

    \1\Streamlining of Regulations Pertaining to Parts II and III of 
the Federal Power Act and the Public Utility Regulatory Policies Act 
of 1978, Order No. 575, 60 FR 4831 (Jan. 25, 1995); III FERC Stats. 
& Regs., Regulations Preambles 31,014 (1995).
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    On February 13, 1995: (a) The American Petroleum Institute 
(American Petroleum) filed a petition for clarification or, in the 
alternative, a request for rehearing; (b) Texaco Cogeneration 
Development (Texaco Cogen) filed a petition for clarification, or, in 
the alternative, a request for rehearing; and (c) Granite State 
Hydropower Association (Granite State) filed a petition for 
clarification, or, in the alternative, a request for 
rehearing. [[Page 22504]] 

American Petroleum and Texaco Cogen

    American Petroleum and Texaco Cogen focus on the same issue. 
Section 292.204(b) requires that waste must comprise at least 75 
percent of the fuel of a waste-fueled qualifying small power production 
facility.2 The Final Rule recognized petroleum coke as waste for 
the purposes of Sec. 292.204(b);3 it described petroleum coke as:

    \2\18 CFR 292.204(b).
    \3\60 FR at 4850; III FERC Stats & Regs. at 31,292.

    A by-product of the oil refining process that is very low in 
volatile matter, usually high in sulfur content, and an 
environmentally hazardous waste.4

    \4\Id. (emphasis added).

    American Petroleum and Texaco Cogen object to the Commission's 
characterization of petroleum coke as ``an environmentally hazardous 
waste.''5 They argue that: (a) The Notice of Proposed Rulemaking 
(NOPR) in this proceeding6 gave no notice that the Commission 
would regard petroleum coke as an environmentally hazardous 
waste;7 (b) there is no evidence in the record to support the 
conclusion that petroleum coke is an environmentally hazardous waste; 
and that, in any event, (c) the Commission is without authority to make 
the determination that petroleum coke is an environmentally hazardous 
waste.

    \5\See American Petroleum Petition for Clarification/Request for 
Rehearing at 2-9; Texaco Cogen Petition for Clarification/Request 
for Rehearing at 1-3.
    \6\Streamlining of Regulations Pertaining to Parts II and III of 
the Federal Power Act and the Public Utility Regulatory Policies Act 
of 1978, 57 FR 55176 (Nov. 24, 1992); IV FERC Stats. & Regs., 
Proposed Regulations 32,489 (1992).
    \7\The NOPR listed petroleum coke among the energy sources that 
the Commission proposed to treat as waste. The NOPR described 
petroleum coke as follows:
    Petroleum coke ordinarily has less than 1 percent ash, has a 
high fixed carbon content (about 90 percent), is very low in 
volatile matter (6 percent to 11 percent) and usually contains more 
than 4.5 percent sulfur. For these reasons it is not a very 
desirable boiler fuel.
    57 FR at 55187 n.69; IV FERC Stats. & Regs. at 32,655 n.69.
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    American Petroleum and Texaco Cogen ask that the Commission remove 
from its characterization of petroleum coke in the preamble the words 
``and an environmentally hazardous waste.'' Alternatively, Texaco Cogen 
asks the Commission to state that the language that petroleum coke is 
an environmentally hazardous waste is without substantive effect.

Granite State

    In the NOPR, the Commission proposed to add a new Sec. 292.202(s), 
which would codify Commission precedent regarding the power production 
capacity of a QF. The Commission proposed to determine a QF's maximum 
net sendout based on the safe and reliable operation of the facility. 
The Commission also proposed to measure a QF's power production 
capacity at the point of delivery to the transmission system of the 
interconnected utility. This proposed rule would have codified the 
Commission's decisions in Power Developers, Inc.8 and Turners 
Falls Limited Partnership.9 In its comments, Granite State opposed 
the codification of those decisions, at least as the codification might 
apply to hydroelectric small power production facilities that are in 
operation when such codification might take effect.

    \8\32 FERC 61,101 (1985) (Power Developers).
    \9\55 FERC 61,136 (1991) (Turners Falls).
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    In the Final Rule, the Commission decided not to add the proposed 
new Sec. 292.202(s) and, therefore, not to codify the Commission's 
decisions in Power Developers and Turners Falls. The Commission noted 
that two pending proceedings raise issues concerning the policy set 
forth in Turners Falls, that the Commission is reviewing those issues 
and will address them in those proceedings, that the Commission is not 
prepared at this time to issue a final rule regarding the policy set 
forth in Turners Falls and that the Commission may in the future codify 
its policy after it has more experience on the issue.10

    \10\60 FR at 4844; III FERC Stats. & Regs. at 31,282. The two 
proceedings are: (a) Carolina Power & Light Company. v. Stone 
Container Corp., Docket Nos. EL94-62-000 and QF85-102-005 (Stone 
Container); and (b) Connecticut Valley Light & Power Company. v. 
Wheelabrator Claremont Company, Docket Nos. EL94-10-000 and QF86-
177-001 (Wheelabrator).
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    Granite State asks the Commission to clarify that it will codify 
the decisions in Power Developers and Turners Falls only after it has 
conducted a properly noticed rulemaking proceeding and to state that it 
was not the Commission's intent in the Final Rule to apply those 
decisions to other hydroelectric small power production 
facilities.11 Should the Commission not grant the requested 
clarification, Granite State seeks rehearing on the grounds that: (1) 
Part 292 of the Commission's regulations, 18 CFR Part 292, allows small 
power producers to sell any power--net or gross--produced by their 
facilities as qualifying facilities and (2) the Commission may only 
change the Part 292 regulations prospectively and only after the 
Commission has conducted a properly noticed rulemaking proceeding.

    \11\Granite State Request for Clarification or Rehearing at 2.
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Discussion

American Petroleum and Texaco Cogen

    We agree with American Petroleum and Texaco Cogen that the record 
is devoid of support for the statement that petroleum coke is an 
environmentally hazardous waste. In any event, reference to the 
environmental effects of petroleum coke is unnecessary to our 
determination to include petroleum coke as a waste for the purposes of 
Sec. 292.204(b). We will, therefore, grant American Petroleum's and 
Texaco Cogen's request for clarification and will dismiss, as moot, 
their alternative requests for rehearing.

Granite State

    With respect to Granite State's opposition to codification and 
application of the policy in the Power Developers and Turners Falls 
decisions, we emphasize, as we stated in the January 13, 1995 Final 
Rule, that we are reviewing the issue in the pending Stone Container 
and Wheelabrator proceedings and would not expect to codify any 
precedent regarding QF power production capacity without obtaining more 
experience with this issue. Since the Commission decided not to codify 
its precedent concerning QF power production capacity in the January 
13, 1995 Final Rule, Granite State's challenge is premature.
    Granite State's request that we not codify in our regulations the 
policy set forth in Power Developers and Turners Falls without a 
properly noticed rulemaking proceeding is also premature. Accordingly, 
we will dismiss Granite State's requests for clarification and 
rehearing.

The Commission Orders

    (A) American Petroleum's and Texaco Cogen's petitions for 
clarification are hereby granted; the first sentence in footnote 95 of 
the preamble to the Final Rule, III FERC Stats. & Regs., Regulations 
Preambles 31,014 at p. 31,292 n.95 (60 FR at 4850 n. 95), is hereby 
amended to read, ``Petroleum coke is a by-product of the oil refining 
process that is very low in volatile matter and usually high in sulfur 
content.''
    (B) American Petroleum's and Texaco Cogen's alternative requests 
for rehearing are hereby dismissed.
    (C) Granite State's requests for clarification and rehearing are 
hereby dismissed as discussed in the body of this order.

    [[Page 22505]] By the Commission.
Lois D. Cashell,
Secretary.
[FR Doc. 95-11213 Filed 5-5-95; 8:45 am]
BILLING CODE 6717-01-P