[Federal Register Volume 64, Number 22 (Wednesday, February 3, 1999)]
[Rules and Regulations]
[Pages 5157-5158]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-2528]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 284

[Docket No. RM96-1-010; Order No.
587-J]


Standards For Business Practices of Interstate Natural Gas 
Pipelines

Issued January 28, 1999.
AGENCY: Federal Energy Regulatory Commission.

ACTION: Final rule; order on rehearing.

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SUMMARY: The Federal Energy Regulatory Commission is granting rehearing 
and clarification of Order No. 587-I, 63 FR 53565, with respect to the 
procedures pipelines must follow in maintaining parity between 
transactions offered on interactive Internet web sites and transactions 
provided using electronic file transfer.

ADDRESSES: Federal Energy Regulatory Commission, 888 First Street, NE, 
Washington, DC 20426.

FOR FURTHER INFORMATION CONTACT:

Michael Goldenberg, Office of the General Counsel, Federal Energy 
Regulatory Commission, 888 First Street, NE, Washington, DC 20426, 
(202) 208-2294
Marvin Rosenberg, Office of Economic Policy, Federal Energy Regulatory 
Commission, 888 First Street, NE, Washington, DC 20426, (202) 208-1283
Kay Morice, Office of Pipeline Regulation, Federal Energy Regulatory 
Commission, 888 First Street, NE, Washington, DC 20426, (202) 208-0507

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 the Public Reference Room 
at 888 First Street, NE, Room 2A, Washington, DC 20426. The Commission 
Issuance Posting System (CIPS) provides access to the texts of formal 
documents issued by the Commission. CIPS can be accessed via Internet 
through FERC's Homepage (http://www.ferc.fed.us) using the CIPS Link or 
the Energy Information Online icon. The full text of this document will 
be available on CIPS in ASCII and WordPerfect 6.1 format. CIPS is also 
available through the Commission's electronic bulletin board service at 
no charge to the user and may be accessed using a personal computer 
with a modem by dialing 202-208-1397, if dialing locally, or 1-800-856-
3920, if dialing long distance. To access CIPS, set your communications 
software to 19200, 14400, 12000, 9600, 7200, 4800, 2400, or 1200 bps, 
full duplex, no parity, 8 data bits and 1 stop bit. User assistance is 
available at 202-208-2474 or by E-mail to [email protected].
    This document is also available through the Commission's Records 
and Information Management System (RIMS), an electronic storage and 
retrieval system of documents submitted to and issued by the Commission 
after November 16, 1981. Documents from November 1995 to the present 
can be viewed and printed. RIMS is available in the Public Reference 
Room or remotely via Internet through FERC's Homepage using the RIMS 
link or the Energy Information Online icon. User assistance is 
available at 202-208-2222, or by E-mail to [email protected].
    Finally, the complete text on diskette in WordPerfect format may be 
purchased from the Commission's copy contractor, RVJ International, 
Inc. RVJ International, Inc., is located in the Public Reference Room 
at 888 First Street, NE, Washington, DC 20426.

    Before Commissioners: James J. Hoecker, Chairman; Vicky A. 
Bailey, William L. Massey, Linda Breathitt, and Curt Hebert, Jr.

Order No. 587-J; Order Granting Rehearing and Clarification

    On October 29, 1998, the Interstate Natural Gas Association of 
America (INGAA) filed a request for clarification or rehearing of Order 
No. 587-I 1 with respect to the policy for achieving parity 
between interactive Internet web sites and electronic file transfers. 
The Commission grants rehearing and provides clarification as discussed 
below.
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    \1\ Standards For Business Practices Of Interstate Natural Gas 
Pipelines, Order No. 587-I, 63 FR 53565 (Oct. 6, 1998), III FERC 
Stats. & Regs. Regulations Preambles para. 31,067 (Sep. 29, 1998).
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Background

    In Order No. 587-I, the Commission, in relevant part, adopted a 
dual approach to communications with interstate pipelines. Shippers 
were given the choice of transacting business with pipelines either 
through an interactive Internet web site 2 or through 
standardized computer-to-computer file transfers. The Commission has 
incorporated by reference into its regulations standards governing 
electronic file transfers promulgated by the Gas Industry Standards 
Board (GISB).3 These standards employ a format using ASC X12 
electronic data interchange (EDI).4 To ensure a level 
playing field for those using interactive web sites and EDI file 
transfers, the Commission sought to ensure that shippers could conduct 
the same transactions and receive the same response priority regardless 
of the format used.5
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    \2\ Interactive web sites permit shippers to view information 
on-line and transmit information to the pipelines by filling in on-
line forms.
    \3\ GISB is a private, not-for-profit standards organization 
with membership drawn from all segments of the natural gas industry, 
including pipelines, local distribution companies, producers, end-
users, and service providers (including gas marketers). Its 
standards must be approved by a consensus of the industry segments.
    \4\ Standards for EDI are promulgated by the American National 
Standards Institute (ANSI) Accredited Standards Committee (ASC) X12.
    \5\ Order No. 587-I, 63 FR at 53571, III FERC Stats. & Regs. 
Regulations Preambles para. 31,067 at 30,740.
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    The Commission further recognized that pipelines might have a need 
to update and offer new services on their interactive web sites. In 
order to maintain equality between interactive web sites and EDI file 
transfers, the Commission established a process to ensure that, 
whenever feasible, newly-developed transactions available on 
interactive web sites will also be available through EDI file 
transfers:

when pipelines are developing new services for their interactive web 
sites, they must also consider the method for implementing the 
business practice using EDI and, in compliance with standard 1.2.2, 
provide advance notice of their proposed EDI solution to GISB for 
review. Before initiating the new service, pipelines should file 
under section 4 of the NGA at least 30 days prior to the proposed 
implementation date detailing the efforts they have made to develop 
a standardized file transfer. If the pipeline has complied with the 
requirement to provide GISB with advance notice of their proposed 
EDI solution, it would be permitted to implement its new service on 
schedule. This approach should not inhibit development of new 
interactive solutions while at the same time helping to ensure that 
those using file transfers are not denied a

[[Page 5158]]

reasonable opportunity to obtain the same service.6
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    \6\ Order No. 587-I, 63 FR at 53571, III FERC Stats. & Regs. 
Regulations Preambles para. 31,067 at 30,740.

    INGAA contends the Commission has established a new procedural 
requirement for pipeline filings and seeks clarification of the advance 
notice requirement. INGAA maintains that the Commission introduced this 
new procedure without seeking industry comment. It further argues that 
the new procedure is unworkable because it may require pipelines to 
provide special notice to GISB prior to making a filing under section 4 
of the Natural Gas Act (NGA). INGAA maintains that providing advance 
notice only to some customers could be discriminatory. INGAA requests 
clarification that pipelines should provide notice to GISB within a 
reasonable time after they file a notice of a new service with the 
Commission under section 4 of the NGA. In the alternative, INGAA 
requests rehearing of the advance notice requirement.

Discussion

    In Order No. 587-I, the Commission's goal was to provide shippers 
with the ability to choose the communication methodology that best fits 
their business needs. The Commission, therefore, required pipelines to 
permit shippers to conduct transactions either through on-line 
transactions via the pipelines' proprietary interactive web site or by 
using computer-to-computer standardized EDI file transfers. To ensure 
that both types of shippers are treated without discrimination, the 
Commission required that all transactions conducted on the pipelines' 
interactive web site must, whenever feasible, also be available through 
EDI file transfers. As described in Order No. 587-I, the Commission and 
GISB already have started a process to ensure that all current 
transactions that are conducted on pipeline web sites can be 
accomplished, when feasible, through interactive file 
transfers.7
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    \7\ Order No. 587-I, 63 FR at 53570-71, III FERC Stats. & Regs. 
Regulations Preambles para. 31,067 at 30,738, 30,740.
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    But that leaves the procedure to be followed when pipelines, in the 
future, develop new electronic transactions to be conducted on their 
interactive web sites. The Commission's policy, as articulated in Order 
No. 587-I, is that whenever pipelines begin to develop new interactive 
transactions, they must at the same time develop a method by which the 
transactions can be accomplished using EDI file transfer so that 
shippers using EDI are given a comparable opportunity to accomplish the 
transactions electronically. Moreover, in order to ensure consistency 
in the standardized EDI file transfers, pipelines must keep GISB 
informed of the pipelines' proposed EDI solutions during the course of 
development, so that GISB can review the pipelines' proposed approaches 
to ensure that they are consistent with GISB's standards.
    In Order No. 587-I, the Commission stated that the pipelines should 
file, pursuant to section 4 of the Natural Gas Act, whenever they 
propose to implement a new electronic transaction. Upon 
reconsideration, however, the Commission has determined that it is not 
necessary for pipelines to make a section 4 filing to effectuate the 
Commission's policy. Instead, pipelines must post on their interactive 
web sites a notice of the new transaction along with the method of 
accomplishing that transaction using EDI file transfer. Pipelines also 
must make an informational filing with the Commission when they 
implement the new transaction and should, in that filing, detail the 
efforts they have made to develop an acceptable EDI file transfer 
capability, including the amount of advance notice they have provided 
to GISB of the file transfer capability they have proposed.
    The Commission can use this informational filing to monitor the 
pipelines' compliance with Commission policy to determine whether the 
policy is working or whether further Commission action is necessary. In 
addition, shippers who are unable to use, or are having difficulty 
with, pipeline EDI file transfers can make use of the Commission's 
Enforcement Hotline or the complaint process to bring these to the 
Commission's attention.
    In its rehearing request, INGAA contends that providing GISB with 
notice of a pipeline's electronic transactions before the pipeline 
makes its section 4 filing is improper because it would prematurely 
disclose to certain parties the contents of the section 4 filing. Since 
the Commission is no longer requiring pipelines to make section 4 
filings to implement new electronic transactions, INGAA's concern about 
premature disclosure of a pipeline's section 4 filing is no longer 
material.
    INGAA further contends that GISB, not the pipelines, should be 
responsible for developing EDI file transfers. The Commission 
disagrees. Pipelines must be actively involved in developing file 
transfer capability and cannot leave that process solely in GISB's 
hands. When a pipeline is developing a new transaction for its Internet 
web site, it is responsible for reviewing the current file transfer 
datasets and determining how its proposed transaction can best be 
handled through EDI file transfer. The pipeline is the most familiar 
with its new electronic offering and, therefore, is in the best 
position to develop a file transfer approach to handling that 
transaction. The pipeline would then inform GISB of its proposed 
solution so that GISB can review the pipeline's approach to ensure the 
approach is the most effective means of integrating the transaction 
into the standardized datasets.8
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    \8\ This is similar to the process under GISB standard 1.2.2, 
where the pipeline and a shipper mutually agreed to datasets which 
they then submit to GISB for review and implementation. 18 CFR 
284.10(b)(1)(i), Nominations Related Standards 1.2.2.
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The Commission Orders

    Rehearing is granted and clarification is provided as discussed in 
the body of the order.

    By the Commission.
Linwood A. Watson, Jr.,
Acting Secretary.
[FR Doc. 99-2528 Filed 2-2-99; 8:45 am]
BILLING CODE 6717-01-P