[Federal Register Volume 65, Number 131 (Friday, July 7, 2000)]
[Proposed Rules]
[Pages 41885-41891]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-17163]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 284

[Docket No. RM96-1-015]


Standards For Business Practices Of Interstate Natural Gas 
Pipelines

June 30, 2000.
AGENCY: Federal Energy Regulatory Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Federal Energy Regulatory Commission is proposing to amend 
Sec. 284.12 of its regulations governing standards for conducting 
business practices and electronic communication with interstate natural 
gas pipelines. The Commission is proposing to incorporate by reference 
the most recent version of the standards, Version 1.4, promulgated 
August 31, 1999 and November 15, 1999 by the Gas Industry Standards 
Board (GISB). The Commission also is proposing to adopt a regulation 
requiring pipelines to permit shippers to designate and rank the 
contracts under which gas will flow on a pipeline's system so that 
shippers have the flexibility to choose the transportation contract 
which is the most economical and efficacious to move their gas 
supplies. Version 1.4 of the GISB standards can be obtained from GISB 
at 1100 Louisiana, Suite 4925, Houston, TX 77002, 713-356-0060, http://www.gisb.org.

DATES: Comments are due August 7, 2000.

ADDRESSES: Federal Energy Regulatory Commission, 888 First Street, 
N.E., 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 Markets, Tariffs, and Rates, Federal Energy 
Regulatory Commission, 888 First Street, N.E., Washington, DC 20426, 
(202) 208-1283
Kay Morice, Office of Markets, Tariffs, and Rates, Federal Energy 
Regulatory

[[Page 41886]]

Commission, 888 First Street, N.E., Washington, DC 20426, (202) 208-
0507

SUPPLEMENTARY INFORMATION:

United States of America

Federal Energy Regulatory Commission

    Standards For Business Practices of Interstate Natural Gas 
Pipelines.
    [Docket No. RM96-1-015]

Notice of Proposed Rulemaking

June 30, 2000.

    The Federal Energy Regulatory Commission (Commission) is proposing 
to amend Sec. 284.12 of its regulations governing standards for 
conducting business practices and electronic communications with 
interstate natural gas pipelines. The Commission is proposing to 
incorporate by reference the most recent version of the consensus 
industry standards promulgated by the Gas Industry Standards Board 
(GISB), Version 1.4. The Commission also is proposing to require 
pipelines to permit shippers to designate and rank the contracts under 
which gas will flow on a pipeline's system so that shippers have the 
flexibility to choose the transportation contract which is the most 
economical and efficacious to move their gas supplies.

I. Background

    In Order Nos. 587, 587-B, 587-C, 587-G, 587-H, 587-I, and 587-K the 
Commission adopted regulations to standardize the business practices 
and communication methodologies of interstate pipelines in order to 
create a more integrated and efficient pipeline grid. \1\ In those 
orders, the Commission incorporated by reference consensus standards 
developed by GISB, a private, consensus standards developer composed of 
members from all segments of the natural gas industry.
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    \1\ Standards For Business Practices Of Interstate Natural Gas 
Pipelines, Order No. 587, 61 FR 39053 (Jul. 26, 1996), III FERC 
Stats. & Regs. Regulations Preambles para. 31,038 (Jul. 17, 1996), 
Order No. 587-B, 62 FR 5521 (Feb. 6, 1997), III FERC Stats. & Regs. 
Regulations Preambles para. 31,046 (Jan. 30, 1997), Order No. 587-C, 
62 FR 10684 (Mar. 10, 1997), III FERC Stats. & Regs. Regulations 
Preambles para. 31,050 (Mar. 4, 1997), Order No. 587-G, 63 FR 20072 
(Apr. 23, 1998), III FERC Stats. & Regs. Regulations Preambles para. 
31,062 (Apr. 16, 1998), Order No. 587-H, 63 FR 39509 (July 23, 
1998), III FERC Stats. & Regs. Regulations Preambles para. 31,063 
(July 15, 1998); Order No. 587-I, 63 FR 53565 (Oct. 6, 1998), III 
FERC Stats. & Regs. Regulations Preambles para. 31,067 (Sept. 29, 
1998), Order No. 587-K, 64 FR 17276 (Apr. 9, 1999), III FERC Stats. 
& Regs. Regulations Preambles para. 31,072 (Apr. 2, 1999).
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    On February 23, 2000, GISB filed with the Commission a letter 
stating it had adopted a revised version of its business practice and 
communication standards, Version 1.4. The Version 1.4 standards include 
the standards for implementing pipeline interactive Internet web sites, 
which pipelines were required to implement by June 1, 2000, as well as 
standards for critical notices, and standards for multi-tiered 
allocations.
    GISB also reports on certain issues on which the Commission had 
requested reports in Order No. 587-G. GISB reports that it has approved 
standards for multi-tiered allocations, which are included in Version 
1.4 of the standards. It reports that its Executive Committee has 
approved standards for imbalance trading and netting and title transfer 
tracking, but that these standards are awaiting the development of the 
technical standards for information requirements and technical mapping. 
GISB further reports that the Executive Committee has been unable to 
reach consensus on standards for cross-contract ranking and that its 
confirmations and cross contract ranking subcommittee is considered 
inactive. In a letter dated June 15, 2000, GISB filed a follow-up 
report on cross contract ranking. GISB reports that its Executive 
Committee was unable to achieve consensus with respect to cross 
contract ranking due to disagreement on certain policy issues and that 
in the opinion of the Executive Committee no further progress can be 
made.

II. Discussion

A. Adoption of Version 1.4 of the Standards

    The Commission is proposing to incorporate by reference into its 
regulations Version 1.4 of GISB's consensus standards with an 
implementation date on the first day of the month occurring 90 days 
after publication of the final rule in the Federal Register.\2\ 
Pipelines already were required to implement the interactive Internet 
standards contained in Version 1.4 by June 1, 2000. The other changes 
included in Version 1.4 update and improve the standards, with the 
principal changes occurring in the areas of communication of critical 
notices and multi-tiered allocations. Commission adoption of these 
standards would keep the Commission regulations current.
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    \2\ Pursuant to the regulations regarding incorporation by 
reference, copies of Version 1.4 of the standards are available from 
GISB. 5 U.S.C. 552 (a)(1); 1 CFR 51.
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    GISB approved the standards under its consensus procedures.\3\ As 
the Commission found in Order No. 587, adoption of consensus standards 
is appropriate because the consensus process helps ensure the 
reasonableness of the standards by requiring that the standards draw 
support from a broad spectrum of all segments of the industry. 
Moreover, since the industry itself has to conduct business under these 
standards, the Commission's regulations should reflect those standards 
that have the widest possible support. In Sec. 12(d) of the National 
Technology Transfer and Advancement Act (NTT&AA) of 1995, Congress 
affirmatively requires federal agencies to use technical standards 
developed by voluntary consensus standards organizations, like GISB, as 
means to carry out policy objectives or activities.\4\
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    \3\ This process first requires a super-majority vote of 17 out 
of 25 members of GISB's Executive Committee with support from at 
least two members from each of the five industry segments--
interstate pipelines, local distribution companies, gas producers, 
end-users, and services (including marketers and computer service 
providers). For final approval, 67% of GISB's general membership 
must ratify the standards.
    \4\ Pub L. No. 104-113, Sec. 12(d), 110 Stat. 775 (1996), 15 
U.S.C. 272 note (1997).
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B. Issues Remaining From Order No. 587-G

    In Order No. 587-G, the Commission deferred the adoption of 
regulations in certain areas in which GISB had not yet reached 
consensus, including title transfer tracking, multi-tiered allocations, 
and cross-contract ranking, because the industry asked that GISB be 
given more time to consider the development of standards on these 
subjects. In these areas, the Commission provided policy guidance to 
help facilitate GISB's further consideration and requested a report by 
GISB on its progress in developing the necessary standards. The 
Commission further deferred implementation of its regulation requiring 
pipelines to permit imbalance trading until GISB developed the 
standards needed to implement the regulation.\5\
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    \5\ 18 CFR 284.12(c)(2)(ii).
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    While GISB has adopted standards for multi-tiered allocations and 
is in the process of finalizing standards relating to title transfer 
tracking, and imbalance trading, GISB has been unable to reach 
consensus regarding standards for cross-contract ranking. GISB's 
ability to reach consensus regarding contentious issues such as multi-
tiered allocations and title transfer tracking demonstrates that 
industry self-regulation can successfully bridge gaps between industry 
members in order to implement policies that improve the efficiency and 
competitiveness of the gas industry. On the other hand, GISB's 
inability to reach a consensus on cross-contract ranking demonstrates 
the continued need for Commission oversight of the standards process to 
help resolve policy issues

[[Page 41887]]

that impede the development of standards. The Commission will address 
below its proposal to require pipelines to permit shippers to designate 
and rank the contracts under which gas will flow on each pipeline's 
system and will also address the other areas left unresolved in Order 
No. 587-G.
1. Cross-Contract Ranking
    Cross-contract ranking would enable shippers to allocate gas 
supplies across transportation contracts so that the shipper can choose 
the contract which provides for the most economical transportation. 
Shippers today are doing business using a variety of contracts, 
including their own firm and interruptible contracts, and capacity 
release contracts with different terms and conditions. The ability to 
allocate gas supplies among these contracts will enhance shipper 
flexibility and better enable them to manage their gas supply and 
capacity portfolios.
    From the record submitted by GISB, it is not entirely clear what 
prevented consensus on this issue. A GISB subcommittee developed a set 
of rules for permitting cross-contract ranking (CXKR-1). (The proposed 
standards considered by GISB are reproduced in Appendix A). But when 
these standards were submitted to the Executive Committee, they did not 
receive consensus approval.\6\ A revised standard (CXKR-2) received 
votes of 18 in favor and 5 opposed, but under GISB's rules the vote was 
insufficient because it failed to garner at least two votes from the 
pipeline segment.\7\ The pipelines also submitted a proposal allowing 
for cross-contract ranking (CXKR-3), but the other industry segments 
did not vote for this set of standards. The minutes of the Executive 
Committee meeting do not contain a detailed explanation of the reasons 
for the opposition, although it appears some members were concerned the 
pipeline's proposal did not provide sufficient information to LDCs, 
while the pipelines took the position that the other proposals required 
them to bear too great an information burden.
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    \6\ Minutes of November 11, 1999, GISB Executive Committee 
Meeting, 5-8, 12 (Appendix to February 16, 2000 Transmittal Letter).
    \7\ All five pipeline members opposed the standard. Minutes of 
November 11, 1999, GISB Executive Committee Meeting, 12 (Appendix to 
February 16, 2000 Transmittal Letter) (Voting on CXKR-2). To pass 
the Executive Committee, GISB's rules specify that a standard must 
be approved by 17 out of 25 votes on the committee, with at least 
two from each industry segment.
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    Each of the proposed standards uses the same basic approach to 
achieving cross-contract ranking, by requiring entity to entity 
confirmation. The differences between the approaches are in the 
supplemental information pipelines would be required to provide and in 
the method of confirmation used for production. The two standards that 
appear at issue are standard 2 and standard 3 of proposal CXKR-2.
    Standard 2 states:

As part of the confirmation and scheduling process upon request, the 
TSP should make available, via EBB/EDM, supplemental information 
obtained during or derived from the nomination process. Such 
supplemental information, if available, should include the TSP's 
Service Requester Contract and, based upon the TSP's business 
practice may also, on a mutually agreeable basis, include (1) a 
derivable indicator characterizing the type of contract and service 
being provided, (2) Downstream Contract Identifier and/or (3) 
Service Requester's Package ID.

    Standard 3 states:

Absent mutual agreement to the contrary between the TSP and the 
Operator for confirmations at a production location, the TSP should 
support the fact that the operator will confirm with the TSP to only 
the upstream entity level. These upstream entities should either 
confirm or nominate (at the TSP's determination) at an entity level 
with the TSP.

    Prior to the filing of the GISB report, Koch Gateway Pipeline 
Company (Koch) filed a letter on December 17, 1999, explaining its view 
that the impasse results from the supplemental information requirements 
in standard 2 of proposal CXKR-2 and the requirement in standard 3 of 
proposal CXKR-2 that pipelines confirm with working interest owners 
behind the wellhead. Koch contends that requiring pipelines to provide 
the supplemental information in standard 2 would improperly subject 
pipelines to regulation by states, rather than the Commission, and 
could subject the pipelines to potentially burdensome and inconsistent 
information requirements from different states. Koch contends that the 
standard regarding working interest owners may not be the best 
confirmation procedure for all pipelines. It maintains only a few 
pipelines now provide confirmation to working interest owners and that, 
given the number of working interest owners on its system, universal 
adoption of this standard could be counterproductive by making the 
confirmation more, rather than less, cumbersome. Koch, however, fully 
supports contract ranking standards and objects only to the 
embellishments regarding information requirements and confirmation with 
working interest owners.
    The Commission is proposing to add Sec. 284.12(c)(1)(iii) to its 
regulations requiring pipelines to permit shippers to designate and 
rank the transportation contracts under which gas will flow on each 
pipeline's system. From the record submitted by GISB, it appears a 
general consensus supports cross-contract ranking as a means by which 
shippers can better manage their contracts and gas supplies. The 
impasse is not over the method (entity to entity confirmation) used to 
achieve cross-contract ranking, but to the supplemental information 
requirements and confirmation with working interest owners. The 
Commission, therefore, is proposing to move forward with a regulation 
requiring pipelines to permit shippers to rank gas supplies across 
their contracts and to resolve disputes concerning the informational 
requirements and confirmation with working interest owners after 
receiving comments. The basic requirements for cross-contract ranking 
would appear to be encompassed by the standards contained in the 
pipeline proposal, CXKR-3.
    The Commission solicits comments on whether there is a need for a 
uniform generic standard setting forth additional, limited information 
pipelines should provide to local distribution companies or shippers. 
The GISB record does not make clear why LDCs or others need additional 
information from the pipeline during the confirmation process, and the 
comments should focus on what specific information is needed and why it 
is necessary for the pipelines to provide it. Comments also should 
address whether the need for additional information applies to all 
pipelines or is limited only to certain pipelines that currently 
provide such additional information to LDCs.
    The reason for the disagreement with respect to working interest 
owners also is not clear, and the Commission seeks comment that 
explains the nature of the issue and the differences in viewpoint. 
Comments should address the need for confirmations at the working 
interest level, the costs and benefits of adopting such a requirement 
for pipelines, shippers, and the overall efficiency of the pipeline 
grid, and whether a uniform requirement is necessary or whether 
pipelines should be permitted to choose the method of confirmation with 
producers that best fits their systems.
2. Title Transfer Tracking
    GISB's Executive Committee has reached agreement on business 
standards for title transfer tracking and implementation of these 
standards await only the development of final technical standards. The 
Executive Committee, on

[[Page 41888]]

February 11, 2000, established an Expedited Data Development 
Subcommittee with the charge to promptly finalize the technical 
standards needed to implement title transfer tracking.\8\ The Executive 
Committee also reached agreement that pipelines would implement these 
standards within eight months following the adoption of the technical 
standards in the applicable GISB standards manual.\9\ Given GISB's 
actions with respect to title transfer tracking, the Commission sees no 
further need to propose additional regulations and will expect 
pipelines to implement these standards based on the time frame 
established by GISB.
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    \8\ See http://www.gisb.org/ edd.htm (June 8, 2000) (announcing 
formation of Expedited Data Development Subcommittee).
    \9\ GISB February 16, 2000 Transmittal Letter, at 4.
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3. Implementation of Regulation Requiring Pipelines To Permit Imbalance 
Trading and Netting
    In Order No. 587-G, the Commission adopted a regulation \10\ 
requiring pipelines to permit shippers to offset imbalances on 
different contracts held by the shipper and to trade imbalances, but 
deferred pipeline implementation of the regulation to enable GISB to 
develop the necessary business practice and technical standards 
relating to imbalance trading. GISB reports that its Executive 
Committee has approved the necessary business practice standards, and 
the first task for the Expedited Data Development Subcommittee is to 
develop the information requirements and technical mapping standards 
for imbalance trading. In a contemporaneous order, the Commission is 
requiring pipelines to implement imbalance trading and netting by 
November 1, 2000.
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    \10\ 18 CFR 284.12(c)(2)(ii); Order No. 587-G, 63 FR at 20081, 
III FERC Stats. & Regs. Regulations Preambles para. 31,062, at 
30,677-80.
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III. Notice of Proposed Use of Standards

    Office of Management and Budget Circular A-119 (Sec. 11) (February 
10, 1998) provides that federal agencies should publish a request for 
comment in a Notice of Proposed Rulemaking (NOPR) when the agency is 
seeking to issue or revise a regulation that contains a standard 
identifying whether a voluntary consensus standard or a government-
unique standard is being proposed. In this NOPR, the Commission is 
proposing to use Version 1.4 (August 31, 1999) of the voluntary 
consensus standards developed by GISB.

IV. Information Collection Statement

    The following collections of information contained in this proposed 
rule have been submitted to the Office of Management and Budget (OMB) 
for review under Section 3507(d) of the Paperwork Reduction Act of 
1995, 44 U.S.C. 3507(d). The Commission solicits comments on the 
Commission's need for this information, whether the information will 
have practical utility, the accuracy of the provided burden estimates, 
ways to enhance the quality, utility, and clarity of the information to 
be collected, and any suggested methods for minimizing respondents' 
burden, including the use of automated information techniques. The 
following burden estimates include the costs for implementing GISB's 
Version 1.4 standards which update and improve the existing Version 1.3 
standards and for complying with the Commission's proposed regulation 
requiring pipelines to permit cross-contract ranking. The burden 
estimates are primarily related to start-up for implementing the latest 
version of the standards and the cross-contract ranking regulation and 
will not be on-going costs.

----------------------------------------------------------------------------------------------------------------
                                                             Number of
           Data collection                Number of        responses per        Hours per       Total number of
                                         respondents         respondent          response            hours
----------------------------------------------------------------------------------------------------------------
FERC-545............................                 93                  1                 38              3,534
FERC-549C...........................                 93                  1              1,810            168,330
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    Total Annual Hours for Collection (Reporting and Recordkeeping, (if 
appropriate) = 171,864.
    Information Collection Costs: The Commission seeks comments on the 
costs to comply with these requirements. It has projected the average 
annualized cost per respondent to be the following:

----------------------------------------------------------------------------------------------------------------
                                                                       FERC-  545              FERC-  549C
----------------------------------------------------------------------------------------------------------------
Annualized Capital/Startup Costs..............................                   $2,038                  $97,066
Annualized Costs (Operations & Maintenance)...................                        0                        0
                                                               -------------------------------------------------
    Total Annualized Costs....................................                    2,038                   97,066
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[[Page 41889]]

    OMB regulations \11\ require OMB to approve certain information 
collection requirements imposed by agency rule. The Commission is 
submitting notification of this proposed rule to OMB.
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    \11\ 5 CFR 1320.11.
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    Title: FERC-545, Gas Pipeline Rates: Rate Change (Non-Formal); 
FERC-549C, Standards for Business Practices of Interstate Natural Gas 
Pipelines.
    Action: Proposed collections.
    OMB Control No.: 1902-0154, 1902-0174.
    Respondents: Business or other for profit, (Interstate natural gas 
pipelines (Not applicable to small business.)).
    Frequency of Responses: One-time implementation (business 
procedures, capital/start-up).
    Necessity of Information: This proposed rule, if implemented, would 
upgrade the Commission's current business practice and communication 
standards to the latest edition approved by GISB (Version 1.4) and 
require pipelines to permit cross-contract ranking. The implementation 
of these standards and the requirement to permit cross-contract ranking 
are necessary to increase the efficiency of the pipeline grid.
    The information collection requirements of this proposed rule will 
be reported directly to the industry users. The implementation of these 
data requirements will help the Commission carry out its 
responsibilities under the Natural Gas Act to monitor activities of the 
natural gas industry to ensure its competitiveness and to assure the 
improved efficiency of the industry's operations. The Commission's 
Office of Markets, Tariffs and Rates will use the data in rate 
proceedings to review rate and tariff changes by natural gas companies 
for the transportation of gas, for general industry oversight, and to 
supplement the documentation used during the Commission's audit 
process.
    Internal Review: The Commission has reviewed the requirements 
pertaining to business practices and electronic communication with 
natural gas interstate pipelines and made a determination that the 
proposed revisions are necessary to establish a more efficient and 
integrated pipeline grid. Requiring such information ensures both a 
common means of communication and common business practices which 
provide participants engaged in transactions with interstate pipelines 
with timely information and uniform business procedures across multiple 
pipelines. These requirements conform to the Commission's plan for 
efficient information collection, communication, and management within 
the natural gas industry. The Commission has assured itself, by means 
of its internal review, that there is specific, objective support for 
the burden estimates associated with the information requirements.
    Interested persons may obtain information on the reporting 
requirements by contacting the following: Federal Energy Regulatory 
Commission, 888 First Street, NE., Washington, DC 20426, [Attention: 
Michael Miller, Office of the Chief Information Officer, Phone: (202) 
208-1415, fax: (202)273-0873 email: [email protected]].
    Comments concerning the collection of information(s) and the 
associated burden estimate(s), should be sent to the contact listed 
above and to the Office of Management and Budget, Office of Information 
and Regulatory Affairs, Washington, D.C. 20503 [Attention: Desk Officer 
for the Federal Energy Regulatory Commission, phone: (202) 395-3087, 
fax: (202) 395-7285].

V. 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.\12\ The Commission 
has categorically excluded certain actions from these requirements as 
not having a significant effect on the human environment.\13\ The 
actions proposed to be taken here fall within categorical exclusions in 
the Commission's regulations for rules that are clarifying, corrective, 
or procedural, for information gathering, analysis, and dissemination, 
and for sales, exchange, and transportation of natural gas that 
requires no construction of facilities.\14\ Therefore, an environmental 
assessment is unnecessary and has not been prepared in this rulemaking.
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    \12\ Order No. 486, Regulations Implementing the National 
Environmental Policy Act, 52 FR 47897 (Dec. 17, 1987), FERC Stats. & 
Regs. Preambles 1986-1990 para. 30,783 (1987).
    \13\ 18 CFR 380.4.
    \14\ See 18 CFR 380.4(a)(2)(ii), 380.4(a)(5), 380.4(a)(27).
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VI. Regulatory Flexibility Act Certification

    The Regulatory Flexibility Act of 1980 (RFA) \15\ generally 
requires a description and analysis of final rules that will have 
significant economic impact on a substantial number of small entities. 
The proposed regulations would impose requirements only on interstate 
pipelines, which are not small businesses, and, these requirements are, 
in fact, designed to reduce the difficulty of dealing with pipelines by 
all customers, including small businesses. Accordingly, pursuant to 
Sec. 605(b) of the RFA, the Commission hereby certifies that the 
regulations proposed herein will not have a significant adverse impact 
on a substantial number of small entities.
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    \15\ 5 U.S.C. 601-612.
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VII. Comment Procedures

    The Commission invites interested persons to submit written 
comments on the matters and issues proposed in this notice to be 
adopted, including any related matters or alternative proposals that 
commenters may wish to discuss.
    The original and 14 copies of such comments must be received by the 
Commission before 5:00 p.m., August 7, 2000. Comments should be 
submitted to the Office of the Secretary, Federal Energy Regulatory 
Commission, 888 First Street, NE, Washington DC 20426 and should refer 
to Docket No. RM96-1-015.
    In addition to filing paper copies, the Commission encourages the 
filing of comments either on computer diskette or via Internet E-Mail. 
Comments may be filed in the following formats: WordPerfect 8.0 or 
below, MS Word Office 97 or lower version, or ASCII format.
    For diskette filing, include the following information on the 
diskette label: Docket No. RM96-1-015; the name of the filing entity; 
the software and version used to create the file; and the name and 
telephone number of a contact person.
    For Internet E-Mail submittal, comments should be submitted to 
``[email protected]'' in the following format. On the subject 
line, specify Docket No. RM96-1-015. In the body of the E-Mail message, 
include the name of the filing entity; the software and version used to 
create the file, and the name and telephone number of the contact 
person. Attach the comment to the E-Mail in one of the formats 
specified above. The Commission will send an automatic acknowledgment 
to the sender's E-Mail address upon receipt. Questions on electronic 
filing should be directed to Brooks Carter at 202-501-8145, E-Mail 
address [email protected].
    Commenters should take note that, until the Commission amends its 
rules and regulations, the paper copy of the filing remains the 
official copy of the document submitted. Therefore, any discrepancies 
between the paper filing and the electronic filing or the diskette will 
be resolved by reference to the paper filing.

[[Page 41890]]

    All written comments will be placed in the Commission's public 
files and will be available for inspection in the Commission's Public 
Reference room at 888 First Street, NE, Washington DC 20426, during 
regular business hours. Additionally, comments may be viewed, printed, 
or downloaded remotely via the Internet through FERC's Homepage using 
the RIMS or CIPS links. RIMS contains all comments but only those 
comments submitted in electronic format are available on CIPS. User 
assistance is available at 202-208-2222, or by E-Mail to 
[email protected].

VIII. Document Availability

    In addition to publishing the full text of this document in the 
Federal Register, the Commission provides all interested persons an 
opportunity to view and/or print the contents of this document via the 
Internet through FERC's Home Page (http://www.ferc.fed.us) and in 
FERC's Public Reference Room during normal business hours (8:30 a.m. to 
5:00 p.m. Eastern time) at 888 First Street, NE, Room 2A, Washington, 
DC 20426.
    From FERC's Home Page on the Internet, this information is 
available in both the Commission Issuance Posting System (CIPS) and the 
Records and Information Management System (RIMS).

--CIPS provides access to the texts of formal documents issued by the 
Commission since November 14, 1994.
--CIPS can be accessed using the CIPS link or the Energy Information 
Online icon. The full text of this document is available on CIPS in 
ASCII and WordPerfect 8.0 format for viewing, printing, and/or 
downloading.
--RIMS contains images 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 from FERC's Home Page using the RIMS 
link or the Energy Information Online icon. Descriptions of documents 
back to November 16, 1981, are also available from RIMS-on-the-Web; 
requests for copies of these and other older documents should be 
submitted to the Public Reference Room.

    User assistance is available for RIMS, CIPS, and the Website during 
normal business hours from our Help line at (202) 208-2222 (E-Mail to 
[email protected]) or the Public Reference at (202) 208-1371 (E-
Mail to [email protected]).
    During normal business hours, documents can also be viewed and/or 
printed in FERC's Public Reference Room, where RIMS, CIPS, and the FERC 
Website are available. User assistance is also available.

List of Subjects in 18 CFR Part 284

    Continental shelf, Incorporation by reference, Natural gas, 
Reporting and recordkeeping requirements.

    By direction of the Commission.
David P. Boergers,
Secretary.

    In consideration of the foregoing, the Commission proposes to amend 
Part 284, Chapter I, Title 18, Code of Federal Regulations, 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. 284.12, paragraphs (b)(1)(i) through (v) are revised and 
paragraph (c)(1)(iii) is added to read as follows:


Sec. 284.12  Standards for Pipeline Business Operations and 
Communications.

* * * * *
    (b) * * *
    (1) * * *
    (i) Nominations Related Standards (Version 1.4, August 31, 1999);
    (ii) Flowing Gas Related Standards (Version 1.4, August 31, 1999) 
with the exception of Standards 2.3.29 and 2.3.30;
    (iii) Invoicing Related Standards (Version 1.4, August 31, 1999);
    (iv) Electronic Delivery Mechanism Standards (Version 1.4, November 
15, 1999) with the exception of Standard 4.3.4; and
    (v) Capacity Release Related Standards (Version 1.4, August 31, 
1999).
* * * * *
    (c) * * *
    (1) * * *
    (iii) A pipeline must permit shippers to designate and rank the 
transportation contracts under which gas will flow on the pipeline's 
system.
* * * * *

    Note: The following Appendix will not appear in the Code of 
Federal Regulations.

Appendix

Cross-Contract Ranking Standards GISB Considered, But Did Not Adopt

    Standards considered at the November 11, 1999 GISB Executive 
Committee Meeting.

CXKR-1

S1  Proposed Standard 1

    Absent mutual agreement to the contrary, the standard level of 
confirmation should be entity to entity.

S2  Revised Proposed Standard 2

    As part of the confirmation and scheduling process between a 
Transportation Service Provider (TSP) and a Local Distribution 
Company (LDC), upon request by the LDC, the TSP should make 
available, via EBB/EDM, supplemental information obtained during or 
derived from the nomination process necessary for the LDC to meet 
its statutory and/or regulatory obligations. Such supplemental 
information, if available, should include the TSP's Service 
Requester Contract and, based upon the TSP's business practice may 
also, on a mutually agreeable basis, include (1) a derivable 
indicator characterizing the type of contract and service being 
provided, (2) Downstream Contract Identifier and/or (3) Service 
Requester's Package ID.

S3  Proposed Standard 3

    Absent mutual agreement to the contrary between the TSP and the 
Operator for confirmations at a production location, the TSP should 
support the fact that the operator will confirm with the TSP to only 
the upstream entity level. These upstream entities should either 
confirm or nominate (at the TSP's determination) at an entity level 
with the TSP.

D1  Proposed Definition 1

    Production locations includes wellheads, platforms, plant 
tailgates (excluding straddle plants) and physical wellhead 
aggregation points.

S4  Proposed Standard 4

    When nominated quantities exceed available capacity, the 
Transportation Service Provider (TSP) should first utilize its 
tariff requirements to assign capacity to each service level for 
each Service Requester (SR). The TSP should then use the SR's 
provided scheduling ranks to determine how the available quantities 
should be distributed within a single service level. The SR's 
provided scheduling ranks (as applicable) should be used as follows:
    For reductions identified at or upstream of the constraint 
location, the order for application of ranks is Receipt Rank 
(Priority), Upstream Rank (Priority), Delivery Rank (Priority), 
Downstream Rank (Priority).
    For reductions identified at or downstream of the constraint 
location, the order for application of ranks is Delivery Rank 
(Priority), Downstream Rank (Priority), Receipt Rank (Priority), 
Upstream Rank (Priority).

S5  Proposed Standard 5

    When applying a confirmation reduction to an entity at a 
location, the Transportation

[[Page 41891]]

Service Provider (TSP) should use the Service Requester's (SR's) 
scheduling ranks provided on all nominations for that location and 
entity to determine the appropriate nomination(s) to be reduced, 
except where superseded by the TSP's tariff, general terms and 
conditions, or contractual obligations. The SR's provided scheduling 
ranks (as applicable) should be used as follows:
    For receipt side reductions, the order for application of ranks 
is Upstream Rank (Priority), Receipt Rank (Priority), Delivery Rank 
(Priority), and Downstream Rank (Priority).
    For delivery side reductions, the order for application of ranks 
is Downstream Rank (Priority), Delivery Rank (Priority), Receipt 
Rank (Priority), and Upstream Rank (Priority).

P1  Proposed Principle 1

    In order to effectuate cross contract ranking, the level of 
confirmation at a location should occur at the entity to entity 
level.

S6  Revised Proposed Standard 6

    Transportation Service Providers should utilize Standard 1.3.7 
for ranks submitted in a nomination.

CXKR-2

    Retain all standards in CXKR-1 with the exception of Standard S2 
which would be revised to read as follows:

S2  Amended Revised Proposed Standard 2

    As part of the confirmation and scheduling process upon request, 
the TSP should make available, via EBB/EDM, supplemental information 
obtained during or derived from the nomination process. Such 
supplemental information, if available, should include the TSP's 
Service Requester Contract and, based upon the TSP's business 
practice may also, on a mutually agreeable basis, include (1) a 
derivable indicator characterizing the type of contract and service 
being provided, (2) Downstream Contract Identifier and/or (3) 
Service Requester's Package ID.

CXKR-3 

P1  New Principle

    In order to effectuate cross contract ranking, the level of 
confirmation at a location should occur at the entity-to-entity 
level.

S1  New Standard

    The standard level of confirmation should be entity to entity.

S4  New Standard

    When nominated quantities exceed available capacity on a 
Transportation Service Provider's (TSP's) system, such TSP should 
first utilize its tariff requirements to assign capacity to each 
service level for each Service Requester (SR). The TSP should then 
use the SR's provided scheduling ranks as provided in the SR's 
nomination to determine how the available quantities should be 
distributed within a single service level.
    The SR's provided scheduling ranks (as applicable) should be 
used as follows:
    For reductions identified at or upstream of the constraint 
location, the order for application of ranks is Receipt Rank 
(Priority), Upstream Rank (Priority), Delivery Rank (Priority), 
Downstream Rank (Priority).
    For reductions identified at or downstream of the constraint 
location, the order for application of ranks is Delivery Rank 
(Priority), Downstream Rank (Priority), Receipt Rank (Priority), 
Upstream Rank (Priority).

S5  New Standard

    When applying a confirmation reduction to an entity (Service 
Requester (SR)) at a location, the Transportation Service Provider 
(TSP) should use such SR's scheduling ranks as provided on that SR's 
nominations at that location to determine the appropriate 
nominations(s) to be reduced, except where superceded by the TSP's 
tariff, general terms and conditions, or contractual obligations.
    The SR's provided scheduling ranks (as applicable) should be 
used as follows:
    For receipt side reductions, the order for application of ranks 
is Upstream Rank (Priority), Receipt Rank (Priority), Delivery Rank 
(Priority), Downstream Rank (Priority).
    For delivery side reductions, the order for application of ranks 
is Downstream Rank (Priority), Delivery Rank (Priority), Receipt 
Rank (Priority), Upstream Rank (Priority).

[FR Doc. 00-17163 Filed 7-6-00; 8:45 am]
BILLING CODE 6717-01-P