Standards for Business Practices for Interstate Natural Gas Pipelines, 36633-36638 [E9-17333]

Agencies

• DEPARTMENT OF ENERGY
• Federal Energy Regulatory Commission

[Federal Register Volume 74, Number 141 (Friday, July 24, 2009)]
[Proposed Rules]
[Pages 36633-36638]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-17333]


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

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 284

[Docket No. RM96-1-030]


Standards for Business Practices for Interstate Natural Gas 
Pipelines

Issued July 16, 2009.
AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Notice of proposed rulemaking.

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

SUMMARY: The Federal Energy Regulatory Commission (Commission) is 
proposing to amend its regulations prescribing standards for interstate 
natural gas pipeline business practices and electronic communications 
(found at 18 CFR 284.12) to incorporate by reference standards adopted 
by the Wholesale Gas Quadrant of the North American Energy Standards 
Board (NAESB) for Index-Based Capacity Release and Flexible Delivery 
and Receipt Points. These standards can be obtained from NAESB at 1301 
Fannin, Suite 2350, Houston, TX 77002, 713-356-0060, https://www.naesb.org, and are available for viewing in the Commission's Public 
Reference Room.
    The proposed standard for Flexible Delivery and Receipt Points 
allows natural gas-fired generators easier access to fuel at times when 
capacity is scarce. The proposed standard for Index-Based Capacity 
Release provides clarity on the timing and use of price indices for 
pricing and arranging index-based capacity release transactions.

DATES: Comments are due September 8, 2009.

ADDRESSES: You may submit comments, identified by docket number RM96-1-
030, by any of these methods:
     Agency Web Site: https://www.ferc.gov. Documents created 
electronically using word processing software should be filed in native 
applications or print-to-PDF format and not in a scanned format.
     Mail/Hand Delivery: Commenters unable to file comments 
electronically must mail or hand deliver an original and 14 copies of 
their comments to: Federal Energy Regulatory Commission, Secretary of 
the Commission, 888 First Street, NE., Washington, DC 20426.

FOR FURTHER INFORMATION CONTACT: 

Ryan Irwin (technical issues), Office of Energy Policy and Innovation, 
Federal Energy Regulatory Commission, 888 First Street, NE., 
Washington, DC 20426, (202) 502-6454;
Kay I. Morice (technical issues), Office of Energy Market Regulation, 
Federal Energy Regulatory Commission, 888 First Street, NE., 
Washington, DC 20426, (202) 502-6507;
Gary D. Cohen (legal issues), Office of the General Counsel, Federal 
Energy Regulatory Commission, 888 First Street, NE., Washington, DC 
20426, (202) 502-8321.

SUPPLEMENTARY INFORMATION:  128 FERC ] 61,031.

Standards for Business Practices for Interstate Natural Gas Pipelines; 
Notice of Proposed Rulemaking

    1. The Federal Energy Regulatory Commission (Commission) proposes 
to amend its regulations at 18 CFR 284.12 to incorporate by reference 
the consensus standards adopted by the Wholesale Gas Quadrant (WGQ) of 
the North American Energy Standards Board (NAESB) that (1) permit the 
use of indices to price capacity release transactions and (2) afford 
greater flexibility on the receipt and delivery points for redirects of 
scheduled gas quantities.

I. Background

    2. Since 1996, the Commission has adopted regulations to 
standardize the business practices and communication methodologies of 
natural gas interstate pipelines to create a more integrated and 
efficient pipeline grid. These regulations have been promulgated in the 
Order No. 587 series of orders,\1\ 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 by the 
Commission, these standards have become a part of the Commission's 
regulations and have become mandatory and binding on the natural gas 
pipelines under the Commission's jurisdiction.
---------------------------------------------------------------------------

    \1\ 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).
---------------------------------------------------------------------------

    3. A cold snap in January 2004 in New England highlighted the need 
for better coordination and communication between the gas and electric 
industries as coincident peaks occurred in both industries making the 
acquisition of gas and transportation by power plant operators more 
difficult. In response to this need, in early 2004, NAESB established a 
Gas-Electric Coordination Task Force to examine issues related to the 
interrelationship of the gas and electric industries and identify 
potential areas for improved coordination through standardization. 
NAESB developed a number of standards to enhance the coordination of 
scheduling and other business practices between the gas and electric 
industries. On June 27, 2005, NAESB filed these standards and requested 
clarification regarding a number of additional proposals that it was 
considering, including capacity release indexed pricing, the use of 
flexible receipt and delivery points upstream of a constraint, and 
changes to the intra-day nomination cycle.
    4. In Order No. 698,\2\ the Commission incorporated these standards 
by reference and provided the clarification requested in NAESB's June 
27, 2005 filing. The NAESB report highlighted several issues relating 
to Commission policy that were inhibiting the development of additional 
standards and requested Commission guidance and clarification on these 
issues. In the NOPR \3\ and in Order No. 698, the Commission provided 
clarification and guidance to NAESB regarding Commission policies in 
the following three areas: (1) Uses of gas indices for pricing capacity 
release transactions; (2) flexibility in the use of receipt and 
delivery points; and (3) changes to the intraday nomination schedule to 
increase the number of scheduling opportunities for firm shippers.
---------------------------------------------------------------------------

    \2\ Standards for Business Practices for Interstate Natural Gas 
Pipelines; Standards for Business Practices for Public Utilities, 
Order No. 698, FERC Stats. & Regs. ] 31,251 (2007), order on 
clarification and reh'g, Order No. 698-A, 121 FERC ] 61,264 (2007).
    \3\ Standards for Business Practices for Interstate Natural Gas 
Pipelines; Standards for Business Practices for Public Utilities, 
FERC Stats. & Regs. ] 32,609 (2006) (NOPR).
---------------------------------------------------------------------------

    5. On September 3, 2008, NAESB submitted a report to the Commission 
with respect to these three issues. NAESB reports its membership 
conducted thirteen subcommittee meetings, many of which were multi-day 
meetings, held in a one year period from June 2007 to July 2008. While 
the standards discussed related only to gas issues, NAESB states that 
all interested parties including the Wholesale Electric Quadrant 
membership were asked to participate and make their perspectives known. 
Two hundred participants, including many from the electric industry, 
participated in these meetings.

[[Page 36634]]

    6. NAESB's September 2008 report indicates that the WGQ has adopted 
business practice standards for (1) increasing the flexibility of gas 
receipt and delivery points and (2) index-based pricing for capacity 
releases. In addition, despite holding 12 meetings with respect to 
modifying the intra-day nomination schedule, NAESB reports that none of 
the standards proposed achieved a sufficient consensus.

II. Discussion

    7. We recognize that the issues considered by NAESB were neither 
simple nor straightforward, and very much appreciate the hard work, and 
many hours committed by NAESB, and the 200 volunteers that participated 
in the process of developing and considering these standards. We 
propose to incorporate by reference the standards developed by NAESB 
with respect to index pricing and to flexible receipt and delivery 
points.\4\ These standards will not only assist in providing gas for 
generation, but will provide enhanced flexibility to all shippers. The 
index pricing standards provide rules under which releasing and 
replacement shippers can create rate formulas for capacity release that 
will better reflect the value of capacity. These standards also reflect 
a reasonable compromise for dealing with copyright issues that arise in 
using gas indices to set prices, ensuring that shippers have a 
reasonable choice of available indices to use while equitably spreading 
the costs entailed by the use of such indices among the pipelines and 
shippers. The standard for the use of flexible receipt and delivery 
points will enable all shippers to quickly and efficiently redirect gas 
when such gas may be needed by gas generators or other shippers. With 
respect to the question of intra-day nominations on which consensus was 
not reached, we do not find a sufficient basis in the NAESB record for 
us to propose any changes to our current regulations and policies.
---------------------------------------------------------------------------

    \4\ The WGQ adopted the following changes to its standards: for 
index-based pricing of capacity release transactions, it modified 
WGQ Standards 5.3.1, 5.3.3, and 5.3.26, added WGQ Definitions 5.2.4 
and 5.2.5, and added WGQ Standards 5.3.61, 5.3.62, 5.3.62a, 5.3.63, 
5.3.64, 5.3.65, 5.3.66, 5.3.67, 5.3.68, and 5.3.69; and for flexible 
points of receipt and delivery, it added WGQ Standard 1.3.80.
---------------------------------------------------------------------------

A. NAESB's Business Practice Standards for Index-Based Pricing for 
Capacity Release Transactions and Flexible Point Rights

    8. In Order No. 698, the Commission explained that under its 
regulations, releasing shippers are permitted to use price indices or 
other formula rates on all pipelines, regardless of whether the 
pipeline has included a provision allowing the use of indices as part 
of its discounting provisions.\5\ The Commission asked NAESB to examine 
standards to help ensure that such releases can be processed quickly 
and efficiently.
---------------------------------------------------------------------------

    \5\ An index-based release is a transaction in which the price 
for capacity is determined by differentials in the value of gas 
between the upstream and downstream market. As the Commission found 
in Order No. 637, the implicit value of transportation is the most 
that any person who can purchase gas in the downstream market would 
pay if it purchased gas in the upstream market and had to transport 
it to the downstream market. Regulation of Short-Term Natural Gas 
Transportation Services, and Regulation of Interstate Natural Gas 
Transportation Services, Order No. 637, FERC Stats. & Regs. ] 
31,091, at 31,271 (2000).
---------------------------------------------------------------------------

    9. The standards for index-based pricing provide that shippers 
wishing to release capacity may use a variety of specified indices and 
methods to evaluate bids. The standards provide that pipelines must 
support at least two non-public price index references that are 
representative of receipt and delivery points on its system,\6\ and 
must support all price indices it references in its gas tariff, or 
general terms and conditions of service. Releasing shippers are 
permitted to use alternative indices if the releasing shipper provides 
licenses to the pipeline for the use of those indices. The standards 
provide that the releasing shipper is responsible for providing the 
pipeline, and the replacement shipper, with the method of calculating 
the reservation rate from the index. The pipeline is required to adhere 
to the standard capacity release timeline for processing releases if 
the releasing shipper has provided the pipeline with sufficient 
instructions to evaluate corresponding bids. However, if the offer 
includes unfamiliar or unclear terms and conditions, or an index not 
supported by the pipeline, the pipeline may process the release on a 
slower time frame.
---------------------------------------------------------------------------

    \6\ We understand NAESB's use of the phrase non-public to refer 
to commercial indices that charge subscription or license fees.
---------------------------------------------------------------------------

    10. At the time NAESB filed its report with the Commission, it had 
not completed the technical standards for implementation of these 
standards. However, these technical standards have been completed,\7\ 
and will be included in version 1.9 of the standards.
---------------------------------------------------------------------------

    \7\ See NAESB WGQ 2007 Annual Plan Item 7a/NAESB WGQ 2008 Annual 
Plan Item 4a/NAESB WGQ 2009 Annual Plan Item 4.
---------------------------------------------------------------------------

    11. The Commission regulations require that pipelines permit 
shippers flexibility to change their receipt and delivery points on 
both a primary and secondary basis.\8\ In its June 27, 2005 report to 
the Commission, NAESB requested clarification regarding its 
consideration of a possible standard that would permit shippers to 
shift gas deliveries from a primary to a secondary delivery point when 
a pipeline constraint occurs upstream of both points.\9\ In Order No. 
698, the Commission explained that, under its policies, pipelines must 
implement within-the-path scheduling under which a shipper seeking to 
use a secondary delivery point within its scheduling path has priority 
over another shipper seeking to use the same delivery point but that 
point is outside of its transportation path, and found that NAESB's 
proposal regarding scheduling through upstream constraint points 
appeared consistent with the Commission's regulations and policy.
---------------------------------------------------------------------------

    \8\ 18 CFR 284.221(g) & (h).
    \9\ See Order No. 698, FERC Stats. & Regs. ] 31,251 at P 7-8.
---------------------------------------------------------------------------

    12. In its September 3, 2008 filing, NAESB included a standard that 
would require pipelines to permit shippers to redirect scheduled 
quantities to other receipt points upstream of a constraint point or 
delivery points downstream of a constraint point without a requirement 
that the quantities be rescheduled through the point of constraint. 
This standard will provide shippers, including gas-fired generators, 
with increased flexibility to obtain capacity or gas from other 
shippers without adversely affecting other shippers' scheduling rights.
    13. The standards for indexed capacity releases and flexible point 
rights appear to establish reasonable methods of providing enhanced 
flexibility to shippers and to increase the efficiency of the 
interstate pipeline grid, and we propose to incorporate these standards 
by reference.
    14. NAESB approved the new and modified standards and related 
definitions under its consensus procedures.\10\ Adoption of consensus 
standards is appropriate because the consensus process helps to 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

[[Page 36635]]

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 
determined by the agency.\11\
---------------------------------------------------------------------------

    \10\ 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.
    \11\ Public Law 104-113, 12(d), 110 Stat. 775 (1996), 15 U.S.C. 
272 note (1997).
---------------------------------------------------------------------------

B. Intra-Day Nomination Standards

    15. The NAESB report raised the possibility of developing standards 
that would offer an additional intra-day nomination cycle with rights 
for firm shippers to bump interruptible nominations. In Order No. 698, 
the Commission stated that NAESB should actively consider whether 
changes to existing intra-day schedules would benefit all shippers, and 
provide better coordination between gas and electric scheduling.
    16. The Commission's regulations provide that nominations by 
shippers with firm transportation priority have priority over 
nominations by shippers with interruptible service.\12\ In Order No. 
587-G,\13\ issued in 1998, the Commission, however, followed the Gas 
Industry Standards Board \14\ consensus and permitted pipelines with 
three intra-day nomination opportunities to exempt the last intra-day 
opportunity from bumping. The Commission found that the consensus 
created a fair balance between firm shippers, who will have had two 
opportunities to reschedule their gas, and interruptible shippers and 
will provide some necessary stability in the nomination system, so that 
shippers can be confident by mid-afternoon that they will receive their 
scheduled flows.
---------------------------------------------------------------------------

    \12\ 18 CFR 284.12(b)(1)(i).
    \13\ Standards for Business Practices of Interstate Natural Gas 
Pipelines, Order No. 587-G, FERC Stats. & Regs. ] 31,062, at 30,672 
(1998).
    \14\ At that time, NAESB was the Gas Industry Standards Board 
and had not yet expanded to include the electric industry or the 
retail gas and electric segments.
---------------------------------------------------------------------------

    17. The NAESB standards currently provide shippers four nomination 
opportunities: The Timely Nomination Period (11:30 a.m. CCT \15\ the 
day prior to gas flow), the Evening Nomination Cycle (6 p.m. CCT the 
day before gas flow); Intra-Day 1 (10 a.m. CCT the day of gas flow); 
and Intra-Day 2 (5 p.m. CCT the day of gas flow). A firm nomination for 
the first three nomination cycles has priority over (can bump) an 
already scheduled interruptible (IT) nomination. But at the Intra-Day 2 
cycle, a firm nomination will not bump already scheduled interruptible 
service.
---------------------------------------------------------------------------

    \15\ Central clock time.

--------------------------------------------------------------------------------------------------------------------------------------------------------
               Cycle                  Nomination time (CCT)   Nomination effective         Bumping IT           Bumping notice       Schedule confirmed
--------------------------------------------------------------------------------------------------------------------------------------------------------
Timely.............................  11:30 am..............  Day-Ahead.............  Yes..................  4:30 pm..............  4:30 pm.
Evening............................  6 pm..................  Day-Ahead.............  Yes..................  10 pm................  10 pm.
Intra-Day 1........................  10 am.................  Day of................  Yes..................  2 pm.................  2 pm.
Intra-Day 2........................  5 pm..................  Day of................  No...................  NA...................  9 pm.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    18. The NAESB committee held 12 meetings and considered a wide 
variety of possible revisions to the nomination schedule adopted in 
1998. These included complete revisions of the timeline, including 
changing the gas day; adding intra-day nomination opportunities within 
the existing framework; changing the Intra-Day 2 to a bump nomination 
while adding an additional no-bump nomination period, and merely 
changing the Intra-Day 2 cycle to a bumpable nomination. None of these 
proposals achieved a sufficient consensus at the subcommittee level.
    19. Comments to the Executive Committee were mixed on whether any 
of these options were practicable, cost effective, or feasible. Some 
commenters contended that changing the gas nomination schedule would 
accomplish little for gas electric coordination without a coordinated 
development of a standardized electric schedule.\16\ They also argued 
that no compelling need existed to change the gas schedule and that 
such a change could cause problems, because: Problems persist with 
pipeline confirmations under the current gas nomination timeline and 
increasing the number of nomination cycles or shortening confirmation 
windows is likely to exacerbate those problems; modifying the intraday 
nomination timeline to increase and/or add to the number of bumpable 
cycles will further reduce the time to react to a cut in interruptible 
service; increasing the number of bumpable nomination cycles or 
delaying scheduling will decrease the number of available counter-
parties in the event of a cut in scheduled volumes; adding more and 
later nomination cycles will cause staffing issues for LDCs, pipelines 
and gas marketers resulting in increased costs with no assurance of 
commensurate benefits.\17\ A number of commenters also highlighted the 
need, in their view, to retain the no-bump rule for interruptible 
transportation as being important for electric generators as well as 
the market in general.\18\
---------------------------------------------------------------------------

    \16\ As an example of these comments, see NAESB September 3, 
2008 filing at 26 (Comments of New Jersey Natural Gas Co., New 
Jersey Natural Gas Company, https://naesb.org/pdf3/wgq_060308njng.doc.), Comments of Interested LDCs, https://naesb.org/pdf3/wgq_060308ldc.pdf).
    \17\ Id.
    \18\ As an example, see NAESB September 3, 2008 filing at 26 
(Comments of New England Power Generators Association, https://naesb.org/pdf3/wgq_060308nepga.pdf, Independent Power Producers, 
https://naesb.org/pdf3/wgq_060308ippny.pdf.).
---------------------------------------------------------------------------

    20. Others, however, argued that changes in the operation of the 
gas markets since 1998 warrant ensuring that firm shippers receive the 
full value of their firm contracts. These changes include the 
imposition of strict pro rata hourly take obligations along with 
significant imbalance charges and penalties; the development of the 
organized wholesale electric bid market that has increased the need to 
synchronize the scheduling of natural gas-fired generation units with 
dispatch notification timelines; the introduction of more third-party 
storage and service providers that require synchronization of 
scheduling opportunities in times of peak usage; the introduction of 
hourly gas contracting without hourly gas scheduling; and technological 
developments that permit automated and expedited scheduling.\19\
---------------------------------------------------------------------------

    \19\ As an example, see NAESB September 3, 2008 filing at 26 
(Joint Comments of Multiple Entities, https://naesb.org/pdf3/wgq_060308aps.pdf for a detailed presentation of these arguments).
---------------------------------------------------------------------------

    21. We agree with BG Energy Merchants that ``all in all it was a 
difficult task that FERC gave to NAESB,'' \20\ and we appreciate the 
amount of work and time committed to the consideration of these issues. 
Ultimately, however, we agree with the Interested LDCs that ``a simple, 
one-size fits-all solution does not exist that will

[[Page 36636]]

solve the complex issue of coordinating between the electric and gas 
industries, [because] the diversity within the electric industry (e.g., 
differing timelines, system peaks times, generation mixes, and 
prevalence of firm gas service), in particular, does not suggest that 
revising gas scheduling procedures is the most effective means to 
improve coordination.'' \21\ Based on the extensive NAESB record that 
we reviewed, we are not convinced that we have a sufficient basis for 
finding that any of the proposed revisions create a superior balance of 
interests compared with the original consensus.\22\ We therefore are 
not proposing any changes to our regulations with regard to intra-day 
nominations.
---------------------------------------------------------------------------

    \20\ See NAESB September 3, 2008 filing at 26 (Comments of BG 
Energy Merchants, https://naesb.org/pdf3/wgq_060308bgem_dmt.doc).
    \21\ NAESB September 3, 2008 filing at 26 (Comments of 
Interested LDCs, https://naesb.org/pdf3/wgq_060308ldc.pdf).
    \22\ For example, we do not know the costs to the pipelines and 
practical implications to shippers or others of creating more 
numerous intra-day nomination opportunities or adding a late 
nomination period well after normal business hours.
---------------------------------------------------------------------------

    22. The changes we implemented in Order No. 712,\23\ the removal of 
the price ceiling for short term releases and the use of asset manager 
agreements, together with the standards that NAESB has approved for 
index pricing for capacity release and greater flexibility in using 
receipt and delivery points should assist electric generators as well 
as other shippers in obtaining firm transportation capacity quickly and 
effecting changes in the way their gas is used. Rather than making a 
nationwide change in scheduling affecting all pipelines, this is an 
area best addressed by individual pipelines adding additional 
nomination opportunities or services to better accommodate specific 
conditions of their systems and the needs of gas-fired generation 
within their regions.
---------------------------------------------------------------------------

    \23\ Promotion of a More Efficient Capacity Release Market, 
Order No. 712, FERC Stats. & Regs. ] 31,271 (2008), order on reh'g, 
Order No. 712-A, 73 Fed. Reg. 72,692 (December 1, 2008), FERC Stats. 
& Regs. ] 31,284 (2008).
---------------------------------------------------------------------------

III. Notice of Use of Voluntary Consensus Standards

    23. Office of Management and Budget Circular A-119 (section 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. In this NOPR, the Commission is 
proposing to incorporate by reference voluntary consensus standards 
developed by the WGQ.

IV. Information Collection Statement

    24. The following collection of information contained in this 
proposed rule has 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 to implement the WGQ's 
definitions and business practice standards for interstate natural gas 
pipelines and electronic communication protocols. The burden estimates 
are primarily related to start-up to implement these standards and 
regulations and will not result in ongoing costs.

----------------------------------------------------------------------------------------------------------------
                                                             Number of
           Data collection                Number of        responses per        Hours per       Total number of
                                         respondents         respondent          response            hours
----------------------------------------------------------------------------------------------------------------
FERC-549C...........................                126                  1                 12              1,512
                                     ---------------------------------------------------------------------------
    Totals..........................  .................  .................  .................              1,512
----------------------------------------------------------------------------------------------------------------

    Total Annual Hours for Collection (Reporting and Recordkeeping, (if 
appropriate)) = 1,512.
    Information Collection Costs: The Commission seeks comments on the 
costs to comply with these requirements. It has projected the average 
annualized cost for all respondents to be the following: \24\
---------------------------------------------------------------------------

    \24\ The total annualized cost for the two information 
collections is $226,800. This number is reached by multiplying the 
total hours to prepare a response (hours) by an hourly wage estimate 
of $150 (a composite estimate that includes legal, technical and 
support staff rates). $226,800 = $150 x 1,512.

------------------------------------------------------------------------
                                                            FERC-549C
------------------------------------------------------------------------
Annualized Capital/Startup Costs......................          $226,800
Annualized Costs (Operations & Maintenance)...........               N/A
                                                       -----------------
    Total Annualized Costs............................           226,800
------------------------------------------------------------------------

    25. OMB regulations \25\ 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.
---------------------------------------------------------------------------

    \25\ 5 CFR 1320.11.
---------------------------------------------------------------------------

    Title: Standards for Business Practices of Interstate Natural Gas 
Pipelines (FERC-549C).
    Action: Proposed collections.
    OMB Control No.: 1902-0174.
    Respondents: Business or other for profit (Natural Gas Pipelines 
(Not applicable to small business.)).
    Frequency of Responses: One-time implementation (business 
procedures, capital/start-up).
    32. Necessity of Information: This proposed rule, if implemented, 
would upgrade the Commission's current business practice and 
communication standards to provide for greater accessibility to fuel in 
times of scarcity and rules to allow for alternative indices to 
establish rates for capacity release to better reflect the value of 
that capacity. The implementation of these standards will permit 
greater flexibility by providing a reasonable choice of available 
indices to use while simultaneously providing a greater equalization of 
costs for their use. Incorporation of the standard for use of flexible 
receipt and delivery points allows for the efficient redirection of gas 
when it may be needed by gas-fired generators or other shippers thereby 
improving the reliability in both the electric and gas industries.
    33. The implementation of these data requirements will help the 
Commission carry out its responsibilities under the Natural Gas Act of 
promoting the efficiency and reliability of the gas industries' 
operations. The Commission's Office of Energy Market and Regulation 
will use the data for general industry oversight.
    34. Internal Review: The Commission has reviewed the requirements 
pertaining to business practices of natural gas pipelines and made a

[[Page 36637]]

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.
    35. Interested persons may obtain information on the reporting 
requirements by contacting the following: Federal Energy Regulatory 
Commission, Attn: Michael Miller, Office of the Executive Director, 888 
First Street, NE., Washington, DC 20426 Tel: (202) 502-8415/Fax: (202) 
273-0873, E-mail: michael.miller@ferc.gov.
    36. 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, DC 20503 [Attention: Desk Officer 
for the Federal Energy Regulatory Commission, phone: (202) 395-4638, 
fax: (202) 395-7285].

V. Environmental Analysis

    37. 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.\26\ The 
Commission has categorically excluded certain actions from these 
requirements as not having a significant effect on the human 
environment.\27\ The actions proposed 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.\28\ Therefore, an environmental assessment is unnecessary 
and has not been prepared as part of this NOPR.
---------------------------------------------------------------------------

    \26\ Order No. 486, Regulations Implementing the National 
Environmental Policy Act of 1969, FERC Stats. & Regs. ] 30,783 
(1987).
    \27\ 18 CFR 380.4.
    \28\ See 18 CFR 380.4(a)(2)(ii), 380.4(a)(5), 380.4(a)(27).
---------------------------------------------------------------------------

VI. Regulatory Flexibility Act Certification

    38. The Regulatory Flexibility Act of 1980 (RFA) \29\ generally 
requires a description and analysis of final rules that will have 
significant economic impact on a substantial number of small entities. 
In drafting a rule an agency is required to: (1) Assess the effect that 
its regulation will have on small entities; (2) analyze effective 
alternatives that may minimize a regulation's impact; and (3) make the 
analysis available for public comment.\30\ Based on our analysis of the 
requirements proposed in this NOPR, we do not think the proposed rule 
will have a significant impact on a substantial number of small 
entities.
---------------------------------------------------------------------------

    \29\ 5 U.S.C. 601-612.
    \30\ 5 U.S.C. 601-604.
---------------------------------------------------------------------------

VII. Comment Procedures

    39. The Commission invites interested persons to submit written 
comments on the NAESB business practice standards proposed for 
incorporation by reference in this NOPR, as well as any related matters 
or alternative proposals that commenters may wish to discuss. Comments 
are due September 8, 2009. Comments must refer to Docket No. RM96-1-
030, and must include the commenter's name, the organization they 
represent, if applicable, and their address. Comments may be filed 
either in electronic or paper format.
    40. Comments may be filed electronically via the eFiling link on 
the Commission's Web site at https://www.ferc.gov. The Commission 
accepts most standard word processing formats and commenters may attach 
additional files with supporting information in certain other file 
formats. Commenters filing electronically do not need to make a paper 
filing. Commenters that are not able to file comments electronically 
must send an original and 14 copies of their comments to: Federal 
Energy Regulatory Commission, Secretary of the Commission, 888 First 
Street, NE., Washington, DC 20426. For paper filings, the original and 
14 copies of such comments should be submitted to the Secretary of the 
Commission, Federal Energy Regulatory Commission, 888 First Street, 
NE., Washington, DC 20426.
    41. All comments will be placed in the Commission's public files 
and may be viewed, printed, or downloaded remotely, as described in the 
Document Availability section below. Commenters on this proposal are 
not required to serve copies of their comments on other commenters.

VIII. Document Availability

    42. 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 (https://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.
    43. From FERC's Home Page on the Internet, this information is 
available in eLibrary. The full text of this document is available in 
eLibrary both 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.
    44. User assistance is available for eLibrary and the FERC's Web 
site during the Commission's normal business hours. For assistance, 
contact FERC Online Support by e-mail at FERCOnlineSupport@ferc.gov, or 
by telephone at 202-502-6652 (toll-free at (866) 208-3676) or for TTY, 
contact (202) 502-8659.

List of Subjects in 18 CFR Part 284

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

    By direction of the Commission.
Kimberly D. Bose,
Secretary.
    In consideration of the foregoing, the Commission proposes to amend 
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

    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. 7101-7352; 
43 U.S.C. 1331-1356.

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


Sec.  284.12  Standards for pipeline business operations and 
communications.

    (a) * * *
    (1) * * *
    (i) Additional Standards (General Standards, Creditworthiness 
Standards,

[[Page 36638]]

and Gas/Electric Operational Communications Standards) (Version 1.8, 
September 30, 2006);
    (ii) Nominations Related Standards (Version 1.8, September 30, 
2006) and including the standards contained in NAESB WGQ 2007 Annual 
Plan Item 7b/NAESB WGQ 2008 Annual Plan Item 4b (August 25, 2008);
    (iii) Flowing Gas Related Standards (Version 1.8, September 30, 
2006);
    (iv) Invoicing Related Standards (Version 1.8, September 30, 2006);
    (v) Quadrant Electronic Delivery Mechanism Related Standards 
(Version 1.8, September 30, 2006) with the exception of Standard 4.3.4;
    (vi) Capacity Release Related Standards (Sep. 3, 2008) and 
including the standards contained in NAESB WGQ 2007 Annual Plan Item 
7a/NAESB WGQ 2008 Annual Plan Item 4a (August 25, 2008) and the 
Standards included in NAESB WGQ 2007 Annual Plan Item 7a/NAESB WGQ 2008 
Annual Plan Item 4a/NAESB WGQ 2009 Annual Plan Item 4; and
    (vii) Internet Electronic Transport Related Standards (Version 1.8, 
September 30, 2006) with the exception of Standard 10.3.2.
* * * * *
[FR Doc. E9-17333 Filed 7-23-09; 8:45 am]
BILLING CODE 6717-01-P