[Federal Register Volume 77, Number 144 (Thursday, July 26, 2012)]
[Rules and Regulations]
[Pages 43711-43721]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-18105]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 284

[Docket No. RM96-1-037; Order No. 587-V]


Standards for Business Practices of Interstate Natural Gas 
Pipelines

AGENCY: Federal Energy Regulatory Commission.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: In this Final Rule, the Federal Energy Regulatory Commission 
(Commission) amends its regulations to incorporate by reference the 
latest version (Version 2.0) of certain business practice standards 
adopted by the Wholesale Gas Quadrant (WGQ) of the North American 
Energy Standards Board (NAESB) applicable to natural gas pipelines. In 
addition, based on the minor corrections and errata made by NAESB and 
reported to the Commission on May 4, 2012, the Commission will 
incorporate by reference certain standards that it earlier proposed not 
to

[[Page 43712]]

incorporate, as the revised standards no longer conflict with 
Commission regulations. In this Final Rule, the Commission also 
provides guidance on the criteria the Commission will use in deciding 
whether to grant or deny requests for waivers or extensions of time and 
modifies the compliance filing requirements to add transparency as to 
where in the tariff incorporated standards may be found.

DATES: Effective Date: This rule will become effective August 27, 2012. 
The incorporation by reference of certain publications in this rule is 
approved by the Director of the Federal Register as of August 27, 2012.

FOR FURTHER INFORMATION CONTACT: 

Adam Bednarczyk (technical issues), Office of Energy Market Regulation, 
Federal Energy Regulatory Commission, 888 First Street NE., Washington, 
DC 20426, (202) 502-6444, Email: [email protected].
Tony Dobbins (technical issues), Office of Energy Policy and 
Innovation, Federal Energy Regulatory Commission, 888 First Street NE., 
Washington, DC 20426, (202) 502-6630, Email: [email protected].
Gary D. Cohen (legal issues), Office of the General Counsel, Federal 
Energy Regulatory Commission, 888 First Street NE., Washington, DC 
20426, (202) 502-8321, Email: [email protected].

SUPPLEMENTARY INFORMATION: 

                            Table of Contents
------------------------------------------------------------------------
                                                              Paragraph
                                                                 Nos.
------------------------------------------------------------------------
I. Background..............................................            2
II. Discussion.............................................           11
    A. Incorporation by Reference of the NAESB Standards...           11
    B. Incorporation of Standards 0.3.19 and 0.3.21........           17
    C. Other Standards Issues Raised by Commenters.........           21
        1. Gas-Electric Communication Standards............           21
        2. Interpretations of NAESB WGQ Standards..........           27
        3. Definition of Operating Capacity................           29
III. Implementation Schedule and Procedures for Waivers and           31
 Extension of Time.........................................
    A. Implementation Schedule.............................           33
    B. Waivers and Extensions of Time......................           38
    C. Comments on Implementation and Waiver Policy........           40
IV. Notice of Use of Voluntary Consensus Standards.........           42
V. Information Collection Statement........................           43
VI. Environmental Analysis.................................           50
VII. Regulatory Flexibility Act............................           51
VIII. Document Availability................................           55
IX. Effective Date and Congressional Notification..........           58
------------------------------------------------------------------------

Before Commissioners: Jon Wellinghoff, Chairman; Philip D. Moeller, 
John R. Norris, Cheryl A. LaFleur, and Tony T. Clark.

Final Rule

(Issued July 19, 2012)

    1. In this Final Rule, the Federal Energy Regulatory Commission 
(Commission) amends its regulations at 18 CFR 284.12 to incorporate by 
reference the latest version (Version 2.0) of certain business practice 
standards adopted by the Wholesale Gas Quadrant (WGQ) of the North 
American Energy Standards Board (NAESB) applicable to natural gas 
pipelines including Standards 0.3.19 and 0.3.21 as modified by the 
minor corrections and errata approved by NAESB. In the Notice of 
Proposed Rulemaking,\1\ the Commission proposed not to incorporate 
Standards 0.3.19 and 0.3.21 because these standards conflicted with 
Commission regulations. NAESB's minor corrections ensure consistency 
between the standards and the Commission regulations and the Commission 
will therefore incorporate the standards by reference. In this Final 
Rule, the Commission also provides guidance on the criteria the 
Commission will use in deciding whether to grant or deny requests for 
waivers or extensions of time and modifies the compliance filing 
requirements to add transparency as to where in the tariff incorporated 
standards may be found.
---------------------------------------------------------------------------

    \1\ Standards for Business Practices of Interstate Natural Gas 
Pipelines, Notice of Proposed Rulemaking, 77 FR 10415 (Feb. 22, 
2012), FERC Stats. & Regs. ] 32,686 (2012) (Version 2.0 NOPR).
---------------------------------------------------------------------------

I. Background

    2. Since 1996, the Commission has adopted regulations to 
standardize the business practices and communication methodologies of 
interstate natural gas pipelines to create a more integrated and 
efficient pipeline grid. These regulations have been promulgated in the 
Order No. 587 series of orders,\2\ wherein the Commission has 
incorporated by reference standards for interstate natural gas pipeline 
business practices and electronic communications that were developed 
and adopted by NAESB's WGQ. Upon incorporation by reference, the 
Version 2.0 Standards will become part of the Commission's regulations 
and compliance with these standards by interstate natural gas pipelines 
will become mandatory.
---------------------------------------------------------------------------

    \2\ This series of orders began with the Commission's issuance 
of Standards for Business Practices of Interstate Natural Gas 
Pipelines, Order No. 587, FERC Stats. & Regs. ] 31,038 (1996). The 
most recent order in this series is Order No. 587-U, issued on March 
24, 2010, wherein the Commission incorporated by reference the 
Version 1.9 WGQ Business Practice Standards. Standards for Business 
Practices of Interstate Natural Gas Pipelines, Order No. 587-U, FERC 
Stats. & Regs. ] 31,307 (2010).
---------------------------------------------------------------------------

    3. On March 4, 2011, NAESB filed a report informing the Commission 
that it had adopted and ratified Version 2.0 of its business practice 
standards applicable to natural gas pipelines. The Version 2.0 
Standards revised the Version 1.9 Standards to include: (1) Standards 
to support gas-electric interdependency; (2) standards created for 
Capacity Release redesign due to the elimination of Electronic Data 
Interchange (EDI) for Capacity Release Upload information; (3) 
standards to support the Electronic Delivery Mechanism (EDM); (4) 
standards to support the Customer Security Administration (CSA) 
Process; (5) standards for pipeline postings of information regarding 
waste heat; and

[[Page 43713]]

(6) minor technical maintenance revisions designed to more efficiently 
process wholesale natural gas transactions.
    4. On June 28, 2011, NAESB filed a report informing the Commission 
that it had made modifications to the NAESB WGQ Version 2.0 Standards 
to correct various minor errors. These errata corrections make minor 
revisions to the NAESB WGQ Standards and Data Elements including 
revisions to the: (1) Datasets for Additional Standards; (2) Nomination 
Related Datasets; (3) Flowing Gas Related Standards; (4) Invoicing 
Related Datasets; (5) EDM Related Standards; and (6) Capacity Release 
Related Standards and Datasets.
    5. Further, on October 11, 2011, NAESB filed a report informing the 
Commission that it had made additional modifications to the NAESB WGQ 
Version 2.0 Standards to correct various minor errors in the 
Nominations Related and Capacity Release Related Datasets.
    6. On December 22, 2011, NAESB reported to the Commission that it 
had made additional modifications to the NAESB WGQ Version 2.0 
Standards to correct various minor errors. The errata corrections make 
minor revisions to the NAESB WGQ Standards and Datasets including 
revisions to the: (1) Nominations Related Datasets; (2) Capacity 
Release Related Datasets; and (3) Quadrant Electronic Delivery 
Mechanism Related Standards.
    7. Consistent with its practice in past rulemakings where the 
Commission found benefits in incorporating by reference NAESB's 
business practice standards,\3\ the Commission issued the Version 2.0 
NOPR, which proposed to amend the Commission's regulations at 18 CFR 
284.12 to incorporate by reference the latest version of certain 
business practice standards adopted by NAESB's WGQ applicable to 
natural gas pipelines.\4\
---------------------------------------------------------------------------

    \3\ See, e.g., Order No. 587, FERC Stats. & Regs. ] 31,038 at 
30,059, where the Commission found that the 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 industry participants 
representing all segments of the industry. The Commission also noted 
that, because the industry has to conduct business under these 
standards, the Commission's regulations should reflect those 
standards that have the widest possible support. In section 12(d) of 
the National Technology Transfer and Advancement Act of 1995 
(NTT&AA), Congress affirmatively requires federal agencies to use 
technical standards developed by voluntary consensus standards 
organizations, like NAESB, as a means to carry out policy objectives 
or activities. These findings remain valid.
    \4\ See supra n.1. In its Version 2.0 Standards, the WGQ made 
the following changes to its Version 1.9 Standards:
    It revised Principle 4.1.32; Definitions 0.2.1, 0.2.2, 0.2.3, 
5.2.1, 5.2.4, and 5.2.5; Standards 0.3.11 through 0.3.15, 2.3.34, 
4.3.16, 4.3.23, 4.3.28, 4.3.29, 4.3.54, 5.3.1 through 5.3.14, 
5.3.16, 5.3.19 through 5.3.21, 5.3.24 through 5.3.27, 5.3.31 through 
5.3.33, 5.3.38, 5.3.42, 5.3.48, 5.3.50, 5.3.51, 5.3.60, 5.3.62, 
5.3.62a, and 5.3.63 through 5.3.69; and Datasets 1.4.1 through 
1.4.6, 2.4.1, 2.4.3, 2.4.4, 2.4.6, 2.4.7, 3.4.1, 3.4.4, 5.4.14 
through 5.4.17, and 5.4.20 through 5.4.22.
    It added Definition 0.2.4; Standards 0.3.18 through 0.3.22, 
4.3.100 through 4.3.102, 5.3.70 through 5.3.72; and Datasets 0.4.2, 
0.4.3, and 5.4.24 through 5.4.27.
     It deleted Standards 5.3.17, 5.3.30, 5.3.43, and 5.3.61; and 
Datasets 5.4.1 through 5.4.13, 5.4.18, and 5.4.19.
---------------------------------------------------------------------------

    8. The Version 2.0 NOPR proposed not to incorporate by reference 
Standard 0.3.19, because the Commission found it inconsistent with the 
requirements of 18 CFR 284.13(d), which does not permit a pipeline to 
limit the posting of available capacity to a limited number of points, 
segments, or zones, but requires posting at all receipt and delivery 
points and on the mainline. Additionally, the Version 2.0 NOPR proposed 
not to incorporate by reference Standard 0.3.21, because 18 CFR 
284.13(d) does not limit the posting of information posting to only two 
cycles but requires the posting of capacity availability and scheduled 
capacity ``whenever capacity is scheduled.'' Also, consistent with past 
practice, the Commission proposed not to incorporate Standards 4.3.4 
and 10.3.2 regarding record retention requirements,\5\ NAESB's 
interpretations of its standards,\6\ its optional contracts,\7\ and the 
WEQ/WGQ eTariff Related Standard.\8\ The Commission further provided 
guidance regarding the procedures for pipelines to incorporate the 
standards into their tariffs and explained its policy regarding 
pipeline requests for waiver or extension of time to comply with the 
standards.
---------------------------------------------------------------------------

    \5\ See, e.g., Standards for Business Practices of Interstate 
Natural Gas Pipelines, Final Rule, Order No. 587-T, FERC Stats. & 
Regs. ] 31,289, at P 5 & n.9 (2009).
    \6\ Standards for Business Practices and Communication Protocols 
for Public Utilities, Order No. 676-E, FERC Stats. & Regs. ] 31,299, 
at n.16 (2009).
    \7\ Id.
    \8\ See Electronic Tariff Filings, Order No. 714, FERC Stats. & 
Regs. ] 31,276 (2008).
---------------------------------------------------------------------------

    9. In response to the Version 2.0 NOPR, comments were filed by six 
commenters.\9\ The comments expressed a variety of views, including 
requests for clarification and modification of the Commission's policy 
on extensions of time to comply with NAESB WGQ Standards. Among the 
comments filed with the Commission were comments from NAESB explaining 
that its WGQ Executive Committee was in the process of voting on two 
standards to rectify the inconsistency with respect to Standards 0.3.19 
and 0.3.21 noted by the Commission in the Version 2.0 NOPR. On May 4, 
2012, NAESB filed a status report informing the Commission that it had 
finalized the two corrections to Standards 0.3.19 and 0.3.21.
---------------------------------------------------------------------------

    \9\ In the Appendix to this Final Rule, we identify all the 
commenters that filed comments in response to the Version 2.0 NOPR, 
along with the abbreviations we are using in this Final Rule to 
identify these commenters.
---------------------------------------------------------------------------

    10. On May 8, 2012, the Commission issued a notice providing 
interested parties an opportunity to file comments with respect to the 
two corrected standards adopted by NAESB and whether the Commission 
should incorporate these revised standards into its regulations.\10\ In 
response to this notice, three comments were filed, all of which 
supported the Commission's incorporation of the revised standards.
---------------------------------------------------------------------------

    \10\ Standards for Business Practices of Interstate Natural Gas 
Pipelines, 77 FR 28331 (May 14, 2012).
---------------------------------------------------------------------------

II. Discussion

A. Incorporation by Reference of the NAESB Standards

    11. After a review of the comments filed in response to the Version 
2.0 NOPR, the Commission is amending part 284 of its regulations to 
incorporate by reference Version 2.0 of the NAESB WGQ's consensus 
standards, including corrected Standards 0.3.19 and 0.3.21.\11\
---------------------------------------------------------------------------

    \11\ In addition, as discussed in the Version 2.0 NOPR and 
above, we are not incorporating by reference Standards 4.3.4 and 
10.3.2, NAESB's interpretation of its standards, its optional 
contracts, or the WEQ/WGQ eTariff Related Standards.
---------------------------------------------------------------------------

    12. The NAESB WGQ Version 2.0 standards include new and modified 
business practice standards to support gas-electric interdependency by 
further defining the roles and responsibilities of each participant 
under the Gas/Electric Operational Communication Standards promulgated 
in Order No. 698,\12\ and giving more details on what is included in 
various notices through the creation of 15 new notice types so that 
public utilities may more easily identify relevant pipelines' system 
conditions. The new notice types are used in the Notices section of 
pipelines' Informational Postings on their Web sites and are used to 
notify shippers and interested parties of intraday bumps, operational 
flow orders, and other critical information by email or other 
electronic methods. This increase in granularity will afford pipelines 
greater flexibility in assigning specific designations to the notices 
and will allow shippers and other interested stakeholders to filter 
pipeline notices more effectively, so that they can focus

[[Page 43714]]

on specific types of notices they deem important, while ignoring 
notices they deem irrelevant.
---------------------------------------------------------------------------

    \12\ Standards for Business Practices of Interstate Natural Gas 
Pipelines; Standards for Business Practices for Public Utilities, 
Order No. 698, FERC Stats. & Regs. ] 31,251, order on clarification 
and reh'g, Order No. 698-A, 121 FERC ] 61,264 (2007).
---------------------------------------------------------------------------

    13. The revised standards also include revisions to facilitate the 
Commission's FY 2009-2014 Strategic Plan \13\ objective of evaluating 
the feasibility of installing waste heat recovery systems as a way to 
promote the efficient design and operation of jurisdictional natural 
gas facilities by specifying the location where such information will 
be posted on pipelines' Web sites.
---------------------------------------------------------------------------

    \13\ Federal Energy Regulatory Commission, Strategic Plan, FY 
2009-2014 at 25. http://www.ferc.gov/about/strat-docs/FY-09-14-strat-plan-print.pdf.
---------------------------------------------------------------------------

    14. To implement these standards, natural gas pipelines will be 
required to file tariff sheets to reflect the changed standards by 
October 1, 2012, to take effect on December 1, 2012, and they will be 
required to comply with these standards on and after December 1, 2012.
    15. NAESB used its consensus procedures to develop and approve the 
Version 2.0 Standards.\14\ As the Commission found in Order No. 587, 
the 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 
industry participants representing 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 section 12(d) of the 
NTT&AA,\15\ Congress affirmatively requires federal agencies to use 
technical standards developed by voluntary consensus standards 
organizations, like NAESB, as means to carry out policy objectives or 
activities determined by the agencies unless an agency determines that 
the use of such standards would be inconsistent with applicable law or 
otherwise impractical.\16\
---------------------------------------------------------------------------

    \14\ This process first requires a super-majority vote of 17 out 
of 25 members of the WGQ's Executive Committee with support from at 
least two members from each of the five industry segments--
Distributors, End Users, Pipelines, Producers, and Services 
(including marketers and computer service providers). For final 
approval, 67 percent of the WGQ's general membership voting must 
ratify the standards.
    \15\ See n.3 supra.
    \16\ Public Law 104-113, Sec.  12(d), 110 Stat. 775 (1996), 15 
U.S.C. 272 note (1997).
---------------------------------------------------------------------------

    16. The comments on the Version 2.0 NOPR generally supported the 
adoption of the standards. In the discussion below, we will address the 
issues raised in the comments.

B. Incorporation of Standards 0.3.19 and 0.3.21

    17. In the Version 2.0 NOPR, the Commission found that two of the 
proposed standards, WGQ Standards 0.3.19 and 0.3.21, as originally 
adopted by the WGQ appeared to be inconsistent with the Commission's 
posting regulations in 18 CFR 284.13(d).\17\ For this reason, the 
Commission proposed in the Version 2.0 NOPR not to incorporate these 
standards by reference.
---------------------------------------------------------------------------

    \17\ 18 CFR 284.13(d). Section 284.13(d) states in relevant part 
that an interstate pipeline must provide on its Internet Web site 
and in downloadable file formats, in conformity with Sec.  284.12, 
equal and timely access to information relevant to the availability 
of all transportation services whenever capacity is scheduled, 
including, but not limited to, the availability of capacity at 
receipt points, on the mainline, at delivery points, and in storage 
fields, whether the capacity is available directly from the pipeline 
or through capacity release, the total design capacity of each point 
or segment on the system, the amount scheduled at each point or 
segment whenever capacity is scheduled, and all planned and actual 
service outages or reductions in service capacity.
---------------------------------------------------------------------------

Filings
    18. On May 4, 2012, NAESB filed a status report informing the 
Commission that it had finalized corrections to the two standards, 
which it believed met the Commission's objections to the original 
standards.\18\ In response to the Commission's notice inviting comments 
on NAESB's corrections, INGAA, Southern Star, and AGA each filed 
comments expressing support for incorporation by reference of the 
corrected standards.\19\
---------------------------------------------------------------------------

    \18\ NAESB corrections MC12005 and MC12006.
    \19\ INGAA Supplemental Comments at 2, Southern Star 
Supplemental Comments at 2, AGA Comments at 2.
---------------------------------------------------------------------------

Commission Determination
    19. Based on the modifications made by NAESB WGQ, the Commission 
will incorporate by reference the modified standards, as they no longer 
conflict with the Commission's regulations. As noted in the Version 2.0 
NOPR, the original NAESB WGQ Version Standard 0.3.19 allowed the 
pipeline to choose whether to post Operationally Available Capacity, 
Operating Capacity, and Total Scheduled Quantity at either a point, 
segment or zone level.\20\ This standard conflicted with section 
284.13(d) \21\ of the regulations that does not permit the pipeline to 
limit the posting to a point, segment, or zone, but requires posting at 
all receipt and delivery points and on the mainline.\22\ The revised 
Standard 0.3.19 \23\ removed the provision permitting the pipeline to 
choose the level at which it reports and therefore no longer conflicts 
with section 284.13(d) \24\ of our regulations.
---------------------------------------------------------------------------

    \20\ The original NAESB WGQ Version 2.0 Standard 0.3.19 stated: 
Operationally Available Capacity (OAC), Operating Capacity (OPC) and 
Total Scheduled Quantity (TSQ) are associated information and should 
be reported at the same level. Transportation Service Providers 
should report OAC, OPC and TSQ at, at least one of, point, segment 
or zone level.
    \21\ See supra n.17.
    \22\ Section 284.13(d) states that the pipeline must post 
``information relevant to the availability of all transportation 
services whenever capacity is scheduled, including, but not limited 
to, the availability of capacity at receipt points, on the mainline, 
at delivery points, and in storage fields.''
    \23\ The revised Standard reads: Operationally Available 
Capacity (OAC), Operating Capacity (OPC) and Total Scheduled 
Quantity (TSQ) are associated information and should be reported at 
the same level of detail.''
    \24\ See supra n.17.
---------------------------------------------------------------------------

    20. The original NAESB WGQ Version 2.0 Standard 0.3.21 required the 
posting of total scheduled quantity and operationally available 
capacity information only at the timely and evening nominations 
cycles.\25\ Section 284.13(d), however, does not limit the posting to 
only two cycles but requires the posting of capacity availability and 
scheduled capacity ``whenever capacity is scheduled.'' Revised Standard 
0.3.21 provides, consistent with the regulation, that the required 
information ``should be updated by the Transportation Service Provider 
to reflect scheduling changes and be reported promptly whenever 
capacity is scheduled.''
---------------------------------------------------------------------------

    \25\ The original NAESB WGQ Standard 0.3.21 states: The Total 
Scheduled Quantity and the Operationally Available Capacity 
information should be updated by the Transportation Service Provider 
to reflect scheduling changes and be reported promptly following the 
scheduling deadline associated with the timely and evening 
nominations cycles.
---------------------------------------------------------------------------

C. Other Standards Issues Raised by Commenters

1. Gas-Electric Communication Standards
    21. The Commission incorporated by reference the NAESB Wholesale 
Electric Quadrant (WEQ) and WGQ Gas/Electric Coordination Standards in 
Order Nos. 698 and 698-A \26\ to ensure that pipelines have relevant 
planning information to assist in maintaining the operational integrity 
and reliability of pipeline service, as well as to provide gas-fired 
power plant operators with information as to whether hourly flow 
deviations can be honored.\27\ In the NAESB WGQ Version 2.0 Standards, 
NAESB modified and developed additional standards to further enhance 
that coordination. NAESB made modifications to its WGQ Standards

[[Page 43715]]

4.3.28, 4.3.29 and 5.3.38 and developed new Standards 5.3.70 and 5.3.71 
to enhance the clarity of the content and format of critical, non-
critical, and planned service outage notices issued by pipelines. NAESB 
also modified the existing gas-electric coordination WGQ Standards 
0.2.1 through 0.2.3, 0.3.11, through 0.3.15; and created a new Standard 
0.2.4 to further define the roles and responsibilities of each 
participant under the Gas/Electric Operational Communication Standards 
promulgated in Order No. 698. As explained in the Version 2.0 NOPR,\28\ 
NAESB also modified WGQ Standard 0.3.14 to change the parties to whom 
pipelines are required to provide notification of operational flow 
orders and other critical notices. Under the Version 2.0 Standards, 
pipelines are now required to provide notification to Balancing 
Authorities and/or Reliability Coordinators, and Power Plant Gas 
Coordinators.
---------------------------------------------------------------------------

    \26\ See supra n.12.
    \27\ These standards are more fully summarized in the Version 
2.0 NOPR, FERC Stats. & Regs. ] 32,686 at P 7.
    \28\ Id. P 9.
---------------------------------------------------------------------------

Comments
    22. Spectra Entities state that the Version 2.0 communication 
standards designed to enhance communication clarity are a good step on 
the path towards increasing electric reliability.\29\ However, they 
assert that enhancement of communication and coordination of scheduling 
are not all that is required to ensure gas supplies to gas-fired 
generation. Spectra Entities state that it is also necessary that firm 
pipeline capacity is available and contracted to supply generation.\30\
---------------------------------------------------------------------------

    \29\ Commenters on the Version 2.0 NOPR, and the abbreviations 
used to identify them, are listed in the Appendix.
    \30\ Spectra Entities Comments at 2, 3.
---------------------------------------------------------------------------

    23. NERC expressed general support for the modifications to 
Standard 0.3.14 that changed the parties to whom pipelines are required 
to provide notification of operational flow orders and other critical 
notices. However, NERC raises a concern about an ambiguity in the 
language of the standard as modified and urges the Commission to 
clarify that pipelines must provide notices of operational flow orders 
and other critical matters to both Balancing Authorities and 
Reliability Coordinators. NERC states that, with this clarification, it 
supports the standard as a step in the right direction that will help 
support the reliability of the bulk power system.\31\
---------------------------------------------------------------------------

    \31\ NERC Comments at 3, 4.
---------------------------------------------------------------------------

Commission Determination
    24. Standard 0.3.14 states:

    A Transportation Service Provider should provide Balancing 
Authorities (BA) and/or Reliability Coordinators (RC) and Power 
Plant Gas Coordinators (PPGC) with notification of operational flow 
orders and other critical notices through the PPGC's choice of 
Electronic Notice Delivery mechanism(s) as set forth in NAESB WGQ 
Standard Nos. 5.2.1, 5.2.2, and 5.3.35-5.3.38.

    25. We interpret this standard to include both Balancing 
Authorities and Reliability Coordinators as affected parties under the 
Commission regulations who are eligible to request from the pipeline 
and receive direct notification through email or Electronic Data 
Interchange of operational flow orders and other critical notices.\32\ 
If both a Balancing Authority and Reliability Coordinator in a relevant 
area request such notification, then the pipeline must provide it. The 
Commission expects Balancing Authorities and Reliability Coordinators 
to request such notification whenever necessary to ensure the 
reliability of their systems.
---------------------------------------------------------------------------

    \32\ This standard refers to the provision of these notices by 
email or Electronic Data Interchange under NAESB standards 5.3.35-
5.3.38. Information regarding operational flow orders and other 
critical notices also is publicly available on the pipelines' Web 
sites pursuant to the postings required by 18 CFR 284.12 (b) (3) 
(vi) and Standards 4.3.27-4.3.29.
---------------------------------------------------------------------------

    26. Spectra's concern with the availability of firm pipeline 
capacity to serve gas-fired generators is beyond the scope of this 
rulemaking.
2. Interpretations of NAESB WGQ Standards
    27. INGAA notes that the Commission's policy is not to incorporate 
NAESB's interpretation of its standards into the Commission's 
regulations.\33\ INGAA recognizes that the Commission's view is that, 
while interpretations may provide useful guidance, they are not 
determinative and the Commission does not require pipelines to comply 
with NAESB's interpretations.\34\ But INGAA states that the 
interpretations can be instructive to the industry on how to implement 
the standards. Further, INGAA suggests that the interpretations should 
be given appropriate deference in circumstance in which pipelines elect 
to rely on the interpretations to implement the standards. INGAA 
contends that the written interpretations of the NAESB WGQ Standards go 
through the same comment and voting process as other standards 
published by NAESB. INGAA requests clarification that pipelines that 
adhere to the NAESB WGQ Interpretations published with Version 2.0, 
including any associated errata subject to the Commission's final order 
in this docket, should be found to be in compliance with the 
standards.\35\
---------------------------------------------------------------------------

    \33\ INGAA Comments at 3 (citing Standards for Business 
Practices and Communication Protocols for Public Utilities, Order 
No. 676-E, FERC Stats. & Regs. ] 31,299 at n.16).
    \34\ Id. (citing Version 2.0 NOPR at 18).
    \35\ Id.
---------------------------------------------------------------------------

Commission Determination
    28. As stated in the Version 2.0 NOPR, while NAESB's 
interpretations may provide useful guidance, historically, the 
Commission's practice has been to not find them determinative and it 
has not required pipelines to comply with them. Because pipelines are 
not required to comply with the interpretations, it is not appropriate 
to include them in the regulations, under which compliance is 
mandatory. While the Commission has found in the past, and will 
continue to find, the interpretations a useful interpretative guide to 
the meaning of standards,\36\ we cannot guarantee that the Commission 
will agree with an interpretation that is not consistent with 
Commission regulations or with the language of the standards.\37\
---------------------------------------------------------------------------

    \36\ See Granite State Gas Transmission, Inc., 98 FERC ] 61,019, 
at 61,057 (2002) (relying on GISB's (now NAESB) interpretation); El 
Paso Natural Gas Company, 97 FERC ] 61,174, at 61,816 (2001) 
(recommending parties seek an interpretation of a standard so the 
record will reflect GISB's construction of the standard); Ozark Gas 
Transmission System, 79 FERC ] 61,222, at 62,006 (1997) (granting 
rehearing based, in part, on interpretation).
    \37\ See, e.g., Standards for Business Practices of Interstate 
Natural Gas Pipelines, Order No. 587-Q, 100 FERC ] 61,105, at P 16 
(2002) (interpreting NAESB standard and not deferring to a request 
to NAESB); ANR Pipeline Co., 80 FERC ] 61,210, at 61,833 (1997) 
(declining to defer in advance to any GISB interpretation, although 
suggesting that the pipeline obtain such an interpretation); Great 
Lakes Gas Transmission Limited Partnership, 79 FERC ] 61,194, at 
61,911 (1997) (declining to adopt an interpretation at odds with 
standard).
---------------------------------------------------------------------------

3. Definition of Operating Capacity
    29. INGAA suggests that NAESB developed the term ``Operating 
Capacity,'' as used in NAESB WGQ Version 2.0 Standard 0.3.19 and 
related standards, to comply with a pipeline's requirement to post 
``design capacity,'' per 18 CFR 284.13(d).\38\ INGAA contends that the 
term ``Operating Capacity,'' and related business standards and data 
set, were created with industry support and approved by the full NAESB 
process. Further, INGAA argues that for the purposes of these NAESB 
Standards, the terms ``Operating Capacity,'' as defined by NAESB, and 
``design capacity'' are interchangeable. Accordingly, INGAA requests 
that the Commission clarify

[[Page 43716]]

that pipelines that post ``Operating Capacity'' as defined by NAESB 
Standards are in compliance with the Commission's requirement for 
pipelines to post ``design capacity,'' per the requirements of 18 CFR 
284.13(d).\39\
---------------------------------------------------------------------------

    \38\ NAESB Standard 0.3.18 states in part: ``Operating Capacity 
(OPC) should be reported as the total capacity which could be 
scheduled at (or through) the identified point, segment or zone in 
the indicated direction of flow.''
    \39\ INGAA Comments at 4.
---------------------------------------------------------------------------

Commission Determination
    30. We will deny INGAA's request for clarification. NAESB defines 
Operating Capacity as ``the total capacity which could be scheduled at 
(or through) the identified point, segment or zone in the indicated 
direction of flow.'' \40\ The Commission's information posting 
requirements in section 284.13(d), however, require pipelines to post 
``Design Capacity,'' not operating capacity. It is not clear that 
NAESB's term ``Operating Capacity,'' although useful, is equivalent to 
the term ``Design Capacity'' used in the Commission regulations.\41\ We 
therefore request that the industry, through NAESB, consider whether 
the two terms are functionally equivalent or specify different types of 
information and to include this information in its next version update. 
Should the industry conclude the terms are not equivalent, NAESB should 
make appropriate revisions to the standards in NAESB's next version by 
adding a design capacity as a separate reporting category. If industry 
members believe that operating capacity is a more useful measure than 
design capacity, they will need to request a revision of 284.13(d). 
While these issues are being considered, we will not require pipelines 
to make changes to their current posting procedures.
---------------------------------------------------------------------------

    \40\ NAESB WGQ Standard No. 0.4.2--Operational Capacity.
    \41\ For example, while pipelines that post both design and 
operating capacity, often report the same number for both types of 
capacity, they may sometimes report differences between operating 
and design capacity. For example, on June 21, 2012, Northwest 
Pipeline posted at its Baker Compressor Decreasing point (177) 
design capacity of 491,000, and Operating Capacity of 700,000. See, 
e.g., Northwest Pipeline GP, Operationally Available Capacity Report 
Posting Date/Time: 6/21/2012 8:15 p.m. (http://www.northwest.williams.com/NWP_Portal/CapacityResultsScrollable.action). See also El Paso Natural Gas Co., 
138 FERC ] 61,215 (2012) (differentiating between certificated 
capacity and sustainable capacity).
---------------------------------------------------------------------------

III. Implementation Schedule and Procedures for Waivers and Extension 
of Time

    31. In the Version 2.0 NOPR, the Commission proposed an 
implementation schedule that would require compliance with the NAESB 
WGQ Version 2.0 Standards beginning on the first day of the month after 
the fourth full month following issuance of the final rule.\42\ To 
clarify, the Commission gave the example that, if the final rule were 
issued on February 17, 2012, compliance would be required beginning on 
July 1, 2012.\43\
---------------------------------------------------------------------------

    \42\ Version 2.0 NOPR, FERC Stats. & Regs. ] 32,686 at P 24.
    \43\ Id.
---------------------------------------------------------------------------

    32. The Commission also proposed in the Version 2.0 NOPR to 
increase the transparency of the pipelines' incorporation by reference 
of the NAESB WGQ Standards so that shippers and the Commission will 
know which tariff provisions implements each standard as well as the 
status of each standard.\44\ To accomplish this, the Commission gave 
proposed instructions on how pipelines should designate sections in 
their tariff filings.\45\
---------------------------------------------------------------------------

    \44\ Id. P 25.
    \45\ Id.
---------------------------------------------------------------------------

A. Implementation Schedule

    33. In their comments on the Version 2.0 NOPR, AGA and Southern 
Star voice support for prompt implementation of the standards.\46\ 
INGAA requests that the Commission revise its implementation 
requirements to permit a pipeline to file its listing of which tariff 
provisions implement each NAESB standard and the status of each NAESB 
standard as part of either a sheet-based or section-based tariff.\47\
---------------------------------------------------------------------------

    \46\ AGA Comments at 4-5, Southern Star Comments at 2.
    \47\ INGAA Comments at 2-3.
---------------------------------------------------------------------------

Commission Determination
    34. The Commission will require natural gas pipelines to comply 
with the NAESB WGQ Version 2.0 Standards that we are incorporating by 
reference in this Final Rule beginning on December 1, 2012. We are 
requiring this implementation schedule to give the natural gas 
pipelines subject to these standards adequate time to implement these 
changes. In addition, pipelines must file tariff records to reflect the 
changed standards by October 1, 2012.
    35. We will grant INGAA's request for clarification and allow sheet 
based solutions. As noted in Order No. 714, companies may determine to 
structure their tariffs either using the existing tariff sheet format 
or as sections.\48\ The intent of the implementation schedule proposed 
in the Version 2.0 NOPR was not to preclude sheet based solutions. 
Accordingly, we will accept sheet-based alternatives.
---------------------------------------------------------------------------

    \48\ Order No. 714, FERC Stats. & Regs. ] 31,276 at P 34.
---------------------------------------------------------------------------

    36. In addition, as proposed in the Version 2.0 NOPR, the 
Commission is also revising the compliance filing requirements to 
increase the transparency of the pipelines' incorporation by reference 
of the NAESB WGQ Standards so that shippers and the Commission will 
know which tariff provision(s) implements each standard as well as the 
status of each standard.
    (1) The pipelines must designate a single tariff section or tariff 
sheet(s) under which every NAESB standard is listed.\49\
---------------------------------------------------------------------------

    \49\ This section should be a separate tariff record under the 
Commission's electronic tariff filing requirements and is to be 
filed electronically using the eTariff portal using the Type of 
Filing Code 580.
---------------------------------------------------------------------------

    (2) For each standard, each pipeline must specify in the tariff 
section or tariff sheet(s) listing all the NAESB standards:
    (a) Whether the standard is incorporated by reference;
    (b) For those standards not incorporated by reference, the tariff 
provision that complies with the standard; \50\ and
---------------------------------------------------------------------------

    \50\ For example, pipelines are required to include the full 
text of the NAESB nomination and capacity release timeline standards 
(WGQ Standards 1.3.2(i-v) and 5.3.2) in their tariffs. Order No. 
587-U, FERC Stats. & Regs. ] 31,307 at P 39 & n.42. The pipeline 
would indicate which tariff provision complies with each of these 
standards.
---------------------------------------------------------------------------

    (c) A statement identifying any standards for which the pipeline 
has been granted a waiver, extension of time, or other variance with 
respect to compliance with the standard.\51\
---------------------------------------------------------------------------

    \51\ Shippers can use the Commission's electronic tariff system 
to locate the tariff record containing the NAESB standards, which 
will indicate the docket in which any waiver or extension of time 
was granted.
---------------------------------------------------------------------------

    (3) If the pipeline is requesting a continuation of an existing 
waiver or extension of time, it must include a table in its transmittal 
letter that states the standard for which a waiver or extension of time 
was granted, and the docket number or order citation to the proceeding 
in which the waiver or extension was granted.
    37. This information will give Commission staff and all shippers a 
common location that identifies the manner in which the pipeline is 
incorporating all the NAESB WGQ Standards and the standards with which 
it is required to comply. The Commission will post on its eLibrary Web 
site (under Docket No. RM96-1-037) a sample tariff format, to provide 
filers an illustrative example to aid them in preparing their 
compliance filings.\52\
---------------------------------------------------------------------------

    \52\ http://www.ferc.gov/docs-filing/elibrary.asp.
---------------------------------------------------------------------------

B. Waivers and Extensions of Time

    38. As discussed in the Version 2.0 NOPR, in previous compliance 
proceedings there has been a marked increase in the number of requests 
for waivers or for extensions of time to comply with standards. The

[[Page 43717]]

Commission's orders on these requests have developed a set of general 
principles that the Commission intends to follow in reviewing such 
requests in the future.\53\ Thus, as discussed in the Version 2.0 NOPR 
and consistent with existing precedent, the Commission clarifies its 
policy regarding requests for waivers and extensions of time as well as 
the information that must accompany such requests as follows:
---------------------------------------------------------------------------

    \53\ See Standards for Business Practices of Interstate Natural 
Gas Pipelines, compliance order, 133 FERC ] 61,096, at P 4 (October 
28 Order), further compliance order, 133 FERC ] 61,185, at P 4 
(2010) (November 30 Order); B-R Pipeline Co., 128 FERC ] 61,126 
(2009) (B-R Pipeline).
---------------------------------------------------------------------------

    (1) All waivers and extensions of time will be granted only in 
reference to the individual set of NAESB standards being adopted (in 
this case NAESB WGQ's Version 2.0 Standards). Pipelines will need to 
seek renewal of any such waivers or extensions for each version of the 
standards the Commission adopts.\54\ We will follow this practice to 
avoid an automatic renewal without oversight of a waiver or extension 
in a situation where there may no longer be a need to continue the 
waiver or extension. If circumstances continue to support the need for 
a waiver or extension, the pipeline can detail those circumstances to 
the Commission in a new request for waiver or extension.
---------------------------------------------------------------------------

    \54\ In B-R Pipeline, 128 FERC ] 61,126 at P 6, the Commission 
stated that ``each time the Commission adopts new versions of [the] 
standards * * * pipelines must request waiver [or extension of time] 
of the new standards.''
---------------------------------------------------------------------------

    (2) Waivers or extensions of time will not be granted for standards 
that merely describe the process by which a pipeline must perform a 
business function, if it performs that function, and where the standard 
does not require the pipeline to perform the business function.\55\ In 
such a case, as long as the pipeline does not perform the business 
function, it does not trigger a requirement to comply with the standard 
and hence no waiver or extension of time is required. If, however, the 
pipeline begins performing the business function, the standard(s) will 
already be in its tariff and the pipeline will be required to comply 
with the standard(s).\56\
---------------------------------------------------------------------------

    \55\ October 28 Order, 133 FERC ] 61,096 at P 9; November 30 
Order, 133 FERC ] 61,185 at P 7.
    \56\ As an example, Standard 4.3.96 requires pipelines to 
provide hourly gas quality information ``to the extent that the TSP 
is required to do so in its tariff or general terms and conditions, 
a settlement agreement, or by order of an applicable regulatory 
authority.'' A pipeline that is not required to provide hourly gas 
quality information, therefore, does not require a waiver or 
extension of time for compliance with this standard, because the 
standard imposes no obligation on the pipeline to comply with the 
standard until it provides hourly gas quality information. See 
October 28 Order, 133 FERC ] 61,096 at P 9.
---------------------------------------------------------------------------

    (3) If a pipeline is seeking a renewal of a waiver or extension of 
time request, it must justify why the waiver or extension should remain 
in force and it must provide a citation to an order and docket number 
of the proceeding in which the initial waiver or extension of time was 
granted.\57\
---------------------------------------------------------------------------

    \57\ See Order No. 587-U, FERC Stats. & Regs. ] 31,307 at PP 38-
39.
---------------------------------------------------------------------------

    (4) The Commission ordinarily will decline to grant waivers in 
cases where pipelines maintain they should not be required to incur the 
costs of implementing standards shippers are not interested in using. 
Instead, the Commission's approach to these requests will be to grant 
the pipeline an extension of time for compliance until 60 days after 
the pipeline receives a request to comply with the standard.\58\ 
Waivers are justified only when the pipeline can demonstrate that there 
is good cause not to require the implementation of a standard, even 
though shippers want to use the standard.
---------------------------------------------------------------------------

    \58\ See T.W. Phillips Pipeline Corp., 137 FERC ] 61,104, at P 
11 (2011).
---------------------------------------------------------------------------

    (5) The Commission generally will not entertain waiver or extension 
of time requests for NAESB WGQ Definitions (x.2.z Standards). The NAESB 
WGQ Definitions specify and elucidate specific terms of generally 
applicable business practices and do not require a pipeline to perform 
any action or incur expense to comply with such Definitions. The 
Commission sees a potential for problems arising if it allows a 
pipeline to substitute its own definitions for the consensus 
definitions developed in the NAESB process.
    39. In addition, to provide guidance to pipelines in filing 
requests for waivers or extensions of time, the Commission will explain 
its policy regarding waivers of the following four general categories 
of NAESB standards: (1) Business practice standards; (2) requirements 
to conduct business electronically using the Internet (Internet 
Business Standards); (3) Commission Internet posting requirements 
(Internet Posting Standards); and (4) requirements to conduct computer-
to-computer transactions using EDI. It is important for pipelines to 
identify clearly in their filings the specific standards from which 
they are seeking waivers or extensions of time. In particular, 
pipelines need to be clear as to whether they are requesting waivers of 
the Internet Business Standards or the EDI Standards:
    (1) Waivers or Extensions of Time To Comply With Business Practice 
Standards. Waivers or extensions of time to comply with business 
practice standards will generally be denied because these standards 
establish the basic principles on which business is required to be 
conducted. Nonetheless, if a pipeline believes such a waiver or 
extension of time to comply is justified, it must detail specific 
reasons why it seeks the waiver or extension of time to comply with the 
standard and address alternative methods by which it could comply with 
the objectives of the standard.\59\
---------------------------------------------------------------------------

    \59\ See Carolina Gas Transmission Corp., 131 FERC ] 61,211, at 
P 4 (2010); MoGas Pipeline LLC, 131 FERC ] 61,251, at P 7 (2010); 
Granite State Gas Transmission, Inc., 132 FERC ] 61,262, at P 8 
(2010) (requiring small pipelines to use manual methods of 
implementing index-based capacity releases).
---------------------------------------------------------------------------

    (2) Waivers or Extensions of Time To Comply With the Internet 
Business Standards. Waivers or extensions of time to comply with the 
requirement to conduct business over the Internet generally will be 
granted based on a pipeline's individual circumstances, such as the 
size of the pipeline, the number of shippers, its ability to provide 
electronic services, the demand for such services, and alternative 
means by which the pipeline conducts the business practice. For smaller 
pipelines, the Commission has granted waivers of the Internet Business 
Standards when such pipelines have shown that complying with such 
standards would prove unduly burdensome.\60\ For larger pipelines, the 
Commission has rarely granted waivers or extensions of time to comply 
with the Internet Business Standards.\61\ However, if a pipeline can 
demonstrate that shippers are not using a standard, then the Commission 
generally will grant an extension of time to comply. Such an extension 
of time ensures that pipelines do not needlessly have to spend money 
revamping computer services that shippers do not use while, at the same 
time, ensuring that shippers have access to such services if they need 
them.
---------------------------------------------------------------------------

    \60\ October 28 Order, 133 FERC ] 61,096 at PP 17-18; November 
30 Order, 133 FERC ] 61,185 at P 9.
    \61\ October 28 Order, 133 FERC ] 61,096 at PP 17-18.
---------------------------------------------------------------------------

    (3) Waivers or Extensions of Time To Comply With Internet Posting 
Standards. The Commission rarely grants waivers or extensions of time 
to comply with the posting requirements because posting of this 
information is required by the Commission's regulations. The cost of 
maintaining and posting information on an Internet Web site is not 
great even for smaller pipelines.
    (4) Waivers or Extensions of Time To Comply With EDI Standards. As

[[Page 43718]]

discussed in the Version 2.0 NOPR,\62\ the Commission generally will 
grant waivers or extensions of time to comply with the EDI requirements 
based on a pipeline's individual circumstances, such as the size of the 
pipeline, the number of shippers, its ability to provide electronic 
services, the demand for such services, and alternative means by which 
the pipeline conducts the business practice. For smaller pipelines, the 
Commission generally grants waivers of the EDI Standards when such 
pipelines have shown that complying with such standards would prove 
unduly burdensome.\63\ For larger pipelines on which shippers are not 
using a standard, in lieu of an outright waiver, the Commission 
generally will grant an extension of time until such time as a request 
is made to use EDI.\64\ As with the EDI requirements relating to 
capacity releases,\65\ NAESB also can review whether certain business 
transactions still need to be available through EDI, given the lack of 
usage, and pipelines can also seek such revisions from NAESB for EDI 
standards whose upkeep no is longer cost justified.
---------------------------------------------------------------------------

    \62\ See Version 2.0 NOPR, FERC Stats. & Regs. ] 32,686 at P 27.
    \63\ Id.
    \64\ See supra n.60; Texas Eastern Transmission LP., 100 FERC ] 
61,364 (2002) (granting an extension of time for unused EDI 
datasets, but requiring compliance with datasets for publicly 
available capacity release information).
    \65\ See Version 2.0 NOPR, FERC Stats. & Regs. ] 32,686 at P 10.
---------------------------------------------------------------------------

C. Comments on Implementation and Waiver Policy

    40. MidAmerican filed the only comment on these policies. It argues 
that 60 days is too short a time period to comply with requests for EDI 
standards, and recommends that the Commission allow pipelines up to 90 
days to comply with a shipper request to implement an EDI dataset not 
currently supported by the pipeline. MidAmerican argues that the that 
90 days is a more reasonable amount of time for compliance, given the 
technological requirements of the NAESB WGQ EDI related data sets.\66\
---------------------------------------------------------------------------

    \66\ MidAmerican Comments at 2, 3.
---------------------------------------------------------------------------

    41. The Commission cannot determine with certainty exactly how long 
it will take each pipeline to comply with each individual NAESB WGQ 
Version 2.0 Standard as this varies, depending on each pipeline's 
unique circumstances. The policy guidance we are giving in this Final 
Rule offers a reasonable general rule for meeting compliance 
obligations that balances both shippers' needs for the Business 
Practices and provides a reasonable amount of time for the pipelines to 
comply with the NAESB WGQ Standards. To the extent a pipeline's unique 
circumstances dictate that it requires additional time to implement a 
given NAESB WGQ Version 2.0 Standard, the pipeline may raise such 
issues in its compliance filing or in a request for waiver or 
extensions of time, so that its shippers will have an opportunity to 
intervene and raise any concerns with the pipeline's proposals.\67\
---------------------------------------------------------------------------

    \67\ See, e.g., WestGas InterState, Inc., 130 FERC ] 61,165, at 
P 4 (2010).
---------------------------------------------------------------------------

IV. Notice of Use of Voluntary Consensus Standards

    42. In section 12(d) of NTT&AA, Congress affirmatively requires 
federal agencies to use technical standards developed by voluntary 
consensus standards organizations, like NAESB, as the means to carry 
out policy objectives or activities determined by the agencies unless 
use of such standards would be inconsistent with applicable law or 
otherwise impractical.\68\ NAESB approved the standards under its 
consensus procedures. 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 NOPR when the agency is seeking to 
issue or revise a regulation proposing to adopt a voluntary consensus 
standard or a government-unique standard. On February 16, 2012, the 
Commission issued the Version 2.0 NOPR, which proposed to incorporate 
by reference NAESB's Version 2.0 Standards. The Commission has taken 
the comments on the Version 2.0 NOPR into account in fashioning this 
Final Rule.
---------------------------------------------------------------------------

    \68\ See supra n.3.
---------------------------------------------------------------------------

V. Information Collection Statement

    43. The Office of Management and Budget's (OMB) regulations require 
approval of certain information collection requirements imposed by 
agency rules. Upon approval of a collection(s) of information, OMB will 
assign an OMB control number and an expiration date. Respondents 
subject to the filing requirements of a rule will not be penalized for 
failing to respond to these collections of information unless the 
collections of information display a valid OMB control number.
    44. This Final Rule amends the Commission's regulations at 18 CFR 
284.12 to incorporate by reference the latest version (Version 2.0) of 
certain business practice standards adopted by NAESB's WGQ applicable 
to natural gas pipelines including Standards 0.3.19 and 0.3.21 as 
modified by the minor corrections and errata approved by NAESB. In this 
Final Rule, the Commission also provides guidance on the criteria the 
Commission will use in deciding whether to grant or deny requests for 
waivers or extensions of time and modifies the compliance filing 
requirements to add transparency as to where in the tariff incorporated 
standards may be found.
    45. Under section 3507(d) of the Paperwork Reduction Act of 
1995,\69\ the reporting requirements in this rulemaking will be 
submitted to OMB for review. OMB elected to take no action on the 
Version 2.0 NOPR, and instead deferred its approval until review of the 
Final Rule.
---------------------------------------------------------------------------

    \69\ 44 U.S.C. 3507(d).
---------------------------------------------------------------------------

    46. The Commission solicited comments on the need for this 
information, whether the information will have practical utility, the 
accuracy of provided burden estimates, ways to enhance the quality, 
utility, and clarity of the information to be collected, and any 
suggested methods for minimizing the respondent's burden, including the 
use of automated information techniques. No comments were filed raising 
any objections to the burden estimate presented in the WGQ Version 2.0 
NOPR. Accordingly, we will use that same burden estimate in this Final 
Rule.

----------------------------------------------------------------------------------------------------------------
                                                                     Number of
                 Data collection                     Number of     responses per     Hours per     Total number
                                                    respondents     respondent       response        of hours
----------------------------------------------------------------------------------------------------------------
FERC-545 \70\...................................             161               1              10           1,610
FERC-549C \71\..................................             161               1              22           3,542
                                                 ---------------------------------------------------------------
    Totals......................................  ..............  ..............  ..............           5,152
----------------------------------------------------------------------------------------------------------------


[[Page 43719]]

    Total Annual Hours for Collections.
    (Reporting and Recordkeeping, If Appropriate) = 5,152.
    Information Collection Costs: The Commission projects the average 
annualized cost of compliance with these regulations to be the 
following: \72\
---------------------------------------------------------------------------

    \70\ Data collection FERC-545 covers rate change filings made by 
natural gas pipelines, including tariff changes (OMB Control No. 
1902-0154).
    \71\ Data collection FERC-549C covers Standards for Business 
Practices of Interstate Natural Gas Pipelines (OMB Control No. 1902-
0174).
    \72\ The total annualized cost for the two information 
collections is $303,968. This number is reached by multiplying the 
total hours to prepare a response (hours) by an hourly wage estimate 
of $59 (a composite estimate that includes legal, technical and 
support staff wages and benefits obtained from the Bureau of Labor 
Statistic data at http://bls.gov/oes/current/naics3_221000.htm and 
http://www.bls.gov/news.release/ecec.nr0.htm rates). $303,968 = $59 
x 5,152.

------------------------------------------------------------------------
                                          FERC-545          FERC-549C
------------------------------------------------------------------------
Annualized Capital/Startup Costs....           $94,990          $208,978
Annualized Costs (Operations &                     N/A               N/A
 Maintenance).......................
                                     -----------------------------------
    Total Annualized Costs..........            94,990           208,978
------------------------------------------------------------------------

    Total Cost for all Respondents = $303,968.
    47. OMB regulations \73\ require OMB to approve certain information 
collection requirements imposed by agency rule. The Commission is 
submitting notification of this proposed rule to OMB. These information 
collections are mandatory requirements.
---------------------------------------------------------------------------

    \73\ 5 CFR 1320.11.
---------------------------------------------------------------------------

    Title: FERC-545, Gas Pipeline Rates: Rates Change (Non-Formal); 
FERC-549C, Standards for Business Practices of Interstate Natural Gas 
Pipelines.
    Action: Proposed collection.
    OMB Control Nos.: 1902-0154, 1902-0174.
    Respondents: Business or other for profit, (i.e., Natural Gas 
Pipelines, applicable to only a few small businesses.) Although the 
intraday reporting requirements will affect electric plant operators, 
the Commission is not imposing the reporting burden of adopting these 
standards on those entities.
    Frequency of Responses: One-time implementation (business 
procedures, capital/start-up).
    Necessity of Information: The requirements in this Final Rule will 
upgrade the Commission's current business practices and communication 
standards by specifically: (1) Adding and revising standards allowing 
the elimination of EDI requirements for Capacity Release Upload 
information; (2) creating and modifying existing information posting 
requirements for Web sites and browsers; (3) requiring pipelines to 
provide security information; (4) requiring the posting of information 
on waste heat recovery feasibility on the Internet; (5) modifying 
pipeline notice content and creating new pipeline notice types; and (6) 
creating standards to ensure NAESB data format is consistent with other 
data reporting via the Internet by using CSV.
    The implementation of these data requirements will provide 
additional transparency to informational posting Web sites and will 
improve communication standards, including gas-electric communications. 
The implementation of these standards and regulations will promote the 
additional efficiency and reliability of the gas industry's operations 
thereby helping the Commission to carry out its responsibilities under 
the Natural Gas Act of promoting the efficiency and reliability of the 
gas industry's operations. In addition, the Commission's Office of 
Enforcement will use the data for general industry oversight.
    Internal Review: The Commission has reviewed the requirements 
pertaining to business practices of natural gas pipelines and made a 
preliminary determination that the proposed revisions are necessary to 
establish more efficient coordination between the gas and electric 
industries. Requiring such information ensures both a common means of 
communication and common business practices to limit miscommunication 
for participants engaged in the sale of electric energy at wholesale 
and the transportation of natural gas. These requirements conform to 
the Commission's plan for efficient information collection, 
communication, and management within the natural gas pipeline 
industries. 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.
    48. Interested persons may obtain information on the reporting 
requirements by contacting the Federal Energy Regulatory Commission, 
Office of the Executive Director, 888 First Street NE., Washington, DC 
20426 [Attention: Ellen Brown, email: [email protected], phone: 
(202) 502-8663, fax: (202) 273-0873].
    49. Comments concerning these information collections can be sent 
to the Office of Management and Budget, Office of Information and 
Regulatory Affairs [Attention: Desk Officer for the Federal Energy 
Regulatory Commission]. For security reasons, comments should be sent 
by email to OMB at the following email address: [email protected]. Please reference FERC-545 and/or FERC 549C and 
the docket number of this Final Rule (Docket No. RM96-1-037) in your 
submission.

VI. Environmental Analysis

    50. 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.\74\ The 
actions 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 electric power that requires 
no construction of facilities.\75\ Therefore, an environmental 
assessment is unnecessary and has not been prepared as part of this 
Final Rule.
---------------------------------------------------------------------------

    \74\ Regulations Implementing the National Environmental Policy 
Act of 1969, Order No. 486, 52 FR 47897 (Dec. 17, 1987), FERC Stats. 
& Regs. Regulations Preambles 1986-1990 ] 30,783 (1987).
    \75\ See 18 CFR 380.4(a)(2)(ii), 380.4(a)(5), 380.4(a)(27).
---------------------------------------------------------------------------

VII. Regulatory Flexibility Act

    51. The Regulatory Flexibility Act of 1980 (RFA) \76\ generally 
requires a description and analysis of final rules that will have 
significant economic impact on a substantial number of small entities. 
The RFA mandates consideration of regulatory alternatives that 
accomplish the stated objectives of a proposed rule and that minimize 
any significant economic impact on a substantial number of small 
entities. The Small Business Administration's (SBA) Office of Size 
Standards develops

[[Page 43720]]

the numerical definition of a small business.\77\ The SBA has 
established a size standard for pipelines transporting natural gas, 
stating that a firm is small if its annual receipts are less than $25.5 
million.\78\
---------------------------------------------------------------------------

    \76\ 5 U.S.C. 601-612.
    \77\ 13 CFR 121.101.
    \78\ 13 CFR 121.201, subsection 486.
---------------------------------------------------------------------------

    52. The standards being incorporated by reference in this final 
rule impose requirements only on interstate pipelines, the majority of 
which are not small businesses. Most companies regulated by the 
Commission do not fall within the RFA's definition of a small entity. 
Approximately 161 entities would be potential respondents subject to 
data collection FERC-545 reporting requirements and also be subject to 
data collection FERC 549-C reporting requirements. Nearly all of these 
entities are large entities. For the year 2010 (the most recent year 
for which information is available), only 10 entities not affiliated 
with larger companies had annual revenues of less than $25.5 
million.\79\
---------------------------------------------------------------------------

    \79\ Our estimate of the number of small entities subject to 
this final rule differs from the tally in the Version 2.0 NOPR 
because the threshold for being deemed a small company recently has 
changed from less than $7 million to less than $25.5 million.
---------------------------------------------------------------------------

    53. The Commission estimates that the one-time implementation cost 
of these standards is $303,968, or $1,888 per company.\80\ The 
Commission does not consider the estimated $1,888 impact per entity to 
be significant. As noted in the Final Rule, the Commission has adopted 
policies permitting small entities to request waivers or extensions of 
time with respect to the electronic processing requirements of these 
regulations. Moreover, the business practice standards are designed to 
benefit all customers, including small businesses.
---------------------------------------------------------------------------

    \80\ This number is derived by dividing the total cost figure by 
the number of respondents. $303,968/161 = $1,888.
---------------------------------------------------------------------------

    54. Accordingly, pursuant to section 605(b) of the RFA,\81\ the 
Commission certifies that the regulations being adopted here will not 
have a significant economic impact on a substantial number of small 
entities.
---------------------------------------------------------------------------

    \81\ 5 U.S.C. 605(b).
---------------------------------------------------------------------------

VIII. Document Availability

    55. 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.gov) and in FERC's 
Public Reference Room during normal business hours (8:30 a.m. to 5 p.m. 
Eastern time) at 888 First Street NE., Room 2A, Washington, DC 20426.
    56. From FERC's Home Page on the Internet, this information is 
available on eLibrary. The full text of this document is available on 
eLibrary in PDF and Microsoft Word format for viewing, printing, and/or 
downloading. To access this document in eLibrary, type the docket 
number excluding the last three digits of this document in the docket 
number field.
    57. User assistance is available for eLibrary and the FERC's Web 
site during normal business hours from FERC Online Support at (202) 
502-6652 (toll free at 1-866-208-3676) or email at 
[email protected], or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at 
[email protected].

IX. Effective Date and Congressional Notification

    58. These regulations are effective August 27, 2012. The Commission 
has determined (with the concurrence of the Administrator of the Office 
of Information and Regulatory Affairs of OMB) that this rule is not a 
``major rule'' as defined in section 351 of the Small Business 
Regulatory Enforcement Fairness Act of 1996.

List of Subjects in 18 CFR Part 284

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

    By the Commission.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
    In consideration of the foregoing, the Commission amends Part 284, 
Chapter I, Title 18, Code of Federal Regulations, as follows.

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

0
1. The authority citation for part 284 continues to read as follows:

    Authority: 15 U.S.C. 717-717z, 3301-3432; 42 U.S.C. 7101-7352; 
43 U.S.C. 1331-1356.

0
2. Section 284.12 is amended by revising paragraphs (a)(1)(1) through 
(vii) to read as follows:


Sec.  284.12  Standards for pipeline business operations and 
communications.

    (a) * * *
    (1) * * *
    (i) Additional Standards (Version 2.0, November 30, 2010, with 
Minor Corrections Applied Through April 30, 2012);
    (ii) Nominations Related Standards (Version 2.0, November 30, 2010, 
with Minor Corrections Applied Through December 2, 2011);
    (iii) Flowing Gas Related Standards (Version 2.0, November 30, 
2010, with Minor Corrections Applied Through June 3, 2011);
    (iv) Invoicing Related Standards (Version 2.0, November 30, 2010, 
with Minor Corrections Applied Through June 3, 2011);
    (v) Quadrant Electronic Delivery Mechanism Related Standards 
(Version 2.0, November 30, 2010, with Minor Corrections Applied Through 
December 2, 2011) with the exception of Standard 4.3.4;
    (vi) Capacity Release Related Standards (Version 2.0, November 30, 
2010, with Minor Corrections Applied Through January 5, 2012); and
    (vii) Internet Electronic Transport Related Standards (Version 2.0, 
November 30, 2010, with Minor Corrections Applied Through January 2, 
2011) with the exception of Standard 10.3.2.
* * * * *

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


                    Appendix--List of Commenters \1\
------------------------------------------------------------------------
              Commenter                      Short name or acronym
------------------------------------------------------------------------
1 Spectra Energy Transmission, LLC,    Spectra Entities.
 Spectra Energy Partners, LP, and
 their regulated pipelines and
 storage facilities.
2 North American Energy Standards      NAESB.
 Board \2\.
3 Interstate Natural Gas Association   INGAA.
 \3\.
4 North American Electric Reliability  NERC.
 Corporation.
5 Southern Star Central Gas Pipeline,  Southern Star.
 Inc.\4\.

[[Page 43721]]

 
6 MidAmerican Energy Pipeline Group,   MidAmerican.
 including Kern River Gas
 Transmission Company and Northern
 Natural Gas Company.
7 American Gas Association \5\.......  AGA.
------------------------------------------------------------------------
\1\ In addition, the ISO/RTO Council submitted notice on March 23, 2012
  that it might file comments in Docket No. AD12-12-000. It filed no
  substantive comments in this proceeding.
\2\ NAESB followed up its March 23, 2012 comments with a pair of status
  reports. The first was filed on April 4, 2012 and the second was filed
  on May 4, 2012.
\3\ INGAA also filed supplemental comments on June 4, 2012 supporting
  the incorporation of standards including NAESB's May 4, 2012
  corrections.
\4\ Southern Star also filed supplemental comments on June 4, 2012
  supporting the incorporation of standards including NAESB's May 4,
  2012 corrections.
\5\ AGA's comments, like those of INGAA and Southern Star, supported the
  incorporation of standards including NAESB's May 4, 2012 corrections.

[FR Doc. 2012-18105 Filed 7-25-12; 8:45 am]
BILLING CODE 6717-01-P