Standards of Conduct for Transmission Providers, 20909-20913 [2010-9264]
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DEPARTMENT OF ENERGY
Federal Energy Regulatory
Commission
Note: The following Appendix will not
appear in the Code of Federal Regulations.
18 CFR Part 358
Appendix A
[Docket No. RM07–1–002; Order No.
717–C]
List of Commenters 38
California Department of Water Resources
State Water Project (Water Project)
California Public Utilities Commission
(California Commission) (with notice of
intervention)
Comverge, Inc. (Comverge)
Duke Energy Corporation (Duke)
Edison Electric Institute (EEI)
FirstEnergy Service Company (FirstEnergy)
Electric Power Supply Association (EPSA)
Electricity Consumers Resource Council
(ELCON)
Energy Curtailment Specialists, Inc.
(Curtailment Specialists) (also filed motion
to intervene)
EnerNOC, Inc. (EnerNOC) (also filed motion
to intervene)
Indiana Utility Regulatory Commission
(Indiana Commission) (with notice of
intervention)
Industrial Coalitions 39
List of Commenters
ISO/RTO Council 40
National Association of Regulatory Utility
Commissioners (NARUC)
National Rural Electric Cooperative
Association (NRECA)
Public Interest Organizations (Public Interest
Orgs) 41
San Diego Gas & Electric Company (SDG&E)
Tennessee Valley Authority (TVA) (with
motion to intervene)
Westar Energy, Inc. (Westar) (with motion to
intervene)
[FR Doc. 2010–9084 Filed 4–21–10; 8:45 am]
BILLING CODE 6717–01–P
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abbreviations used to identify these
commenters in this Final Rule are shown
parenthetically.
39 Filed on behalf of Coalition of Midwest
Transmission Customers, NEPOOL Industrial
Customer Coalition, and PJM Industrial Customer
Coalition.
40 ISO/RTO Council includes the Independent
System Operators operating as the Alberta Electric
System Operator, the California Independent
System Operator, Electric Reliability Council of
Texas, the Independent Electricity System Operator
of Ontario, Inc., ISO New England, Inc., Midwest
Independent Transmission System Operator, Inc.,
New York Independent System Operator, Inc., PJM
Interconnection, L.L.C., Southwest Power Pool, Inc.,
and New Brunswick System Operator.
41 Jointly filed on behalf of Project for Sustainable
FERC Energy Policy, Natural Resources Defense
Council, the Pace Energy and Climate Center and
Conservation Law Foundation.
15:00 Apr 21, 2010
Issued April 16, 2010.
AGENCY: Federal Energy Regulatory
Commission.
ACTION: Order on Rehearing and
Clarification.
SUMMARY: The Federal Energy
Regulatory Commission (Commission)
issued Order No. 717–A to address
requests for rehearing and make clearer
the Standards of Conduct as
implemented by Order No. 717. The
Commission issued Order No. 717–B to
address expedited requests for rehearing
and clarification concerning paragraph
80 of Order No. 717–A and whether an
employee who is not making business
decisions about contract non-price
terms and conditions is considered a
‘‘marketing function employee.’’ This
order addresses additional requests for
rehearing and clarification concerning
Order No. 717–A.
DATES: Effective Date: This rule will
become effective July 21, 2010.
FOR FURTHER INFORMATION CONTACT:
Leonard Tao, Office of the General
Counsel—Energy Markets, Federal
Energy Regulatory Commission, 888
First Street, NE., Washington, DC 20426,
(202) 502–8214.
SUPPLEMENTARY INFORMATION:
Before Commissioners: Jon Wellinghoff,
Chairman; Marc Spitzer, Philip D. Moeller,
and John R. Norris.
38 The
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Standards of Conduct for
Transmission Providers
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Order on Rehearing and Clarification
I. Introduction
1. On October 16, 2008, the
Commission issued Order No. 717
amending the Standards of Conduct for
Transmission Providers (the Standards
of Conduct or the Standards) to make
them clearer and to refocus the rules on
the areas where there is the greatest
potential for abuse.1 On October 15,
2009, the Commission issued Order No.
717–A to address requests for rehearing
and clarification of Order No. 717,
largely affirming the reforms adopted in
1 Standards of Conduct for Transmission
Providers, Order No. 717, 73 FR 63796 (Oct. 27,
2008), FERC Stats. & Regs. ¶ 31,280 (2008) (Order
No. 717).
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20909
Order No. 717.2 On November 16, 2009,
the Commission issued Order No. 717–
B to address expedited requests for
rehearing and clarification concerning
paragraph 80 of Order No. 717–A and
whether an employee who is not making
business decisions about contract nonprice terms and conditions is
considered a ‘‘marketing function
employee.’’ 3 In this order, the
Commission grants additional
clarification concerning matters
petitioners raised regarding the
Commission’s determinations in Order
No. 717–A.
II. Requests for Clarification and/or
Rehearing
2. Edison Electric Institute (EEI),
Transmission Dependent Utility
Systems (TDUS), Transmission Access
Policy Study Group (TAPS), National
Rural Electric Cooperative Association
(NRECA), Associated Electric
Cooperative (AEC), Basin Electric Power
Cooperative (Basin Electric), Xcel
Energy Services (Xcel), E.ON U.S.,
Avista Corporation (Avista), the
American Public Gas Association
(APGA) and Western Utilities 4 filed
requests for clarification, or in the
alternative, requests for rehearing. The
Tri-State Generation and Transmission
Association (Tri-State) filed in support
of the NRECA’s request. The Electric
Power Supply Association (EPSA) filed
a motion for leave to answer and an
answer to Western Utilities’ request for
clarification and rehearing.5
2 Standards of Conduct for Transmission
Providers, Order No. 717–A, 74 FR 54463 (Oct. 22,
2009), FERC Stats. & Regs. ¶ 31,297 (2009) (Order
No. 717–A).
3 Standards of Conduct for Transmission
Providers, Order No. 717–B, 74 FR 60153 (Nov. 20,
2009), 129 FERC ¶ 61,123 (Nov. 16, 2009) (Order
No. 717–B). On October 30, 2009, EEI filed a request
for expedited clarification of a single issue
addressed in Order No. 717–A. The Commission
determined that it should address this issue
expeditiously even though the time allowed under
the regulations for filing rehearing requests had not
yet expired. For this reason, the Commission issued
Order No. 717–B on November 16, 2009, in which
it addressed a single clarification request of EEI,
Western Utilities, Otter Tail and Central Vermont.
All other timely requests for rehearing, i.e. those
filed by November 16, 2009, are addressed in this
order.
4 Western Utilities is comprised of Arizona Public
Service Company, Avista Corporation, El Paso
Electric Company, Idaho Power Company, Pacific
Gas and Electric Company, PacifiCorp, Portland
General Electric Company, Puget Sound Energy,
Southern California Edison Company, and Tucson
Electric Power Company.
5 EPSA objects to Western Utilities’
characterization of its filing as a request for
clarification.
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III. Discussion
A. Procedural Matters
3. Rule 213(a)(2) of the Commission’s
Rules of Practice and Procedure 6
prohibits an answer to a request for
rehearing unless otherwise ordered by
the decisional authority. We will accept
the EPSA’s answer to Western Utilities’
motion for clarification and/or request
for rehearing because it provided
information that assisted us in our
decision-making process.
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B. Independent Functioning Rule
i. Transmission Function Employees
4. In paragraph 27 of Order No.
717–A, the Commission clarified that
personnel engaged in granting or
denying transmission service requests
are transmission function employees
because the act of granting or denying
transmission service requests is an
integral part of ‘‘planning, directing,
organizing or carrying out of day-to-day
transmission operations.’’ 7 The
Commission then elaborated in this
paragraph that the term ‘‘transmission
function employee’’ includes ‘‘an
employee responsible for performing
system impact studies or determining
whether the transmission system can
support the requested services as this
type of employee is planning, directing,
organizing or carrying out the day-today transmission operations.’’ 8
Requests for Rehearing and
Clarification:
5. EEI, Western Utilities, Xcel, Avista
and Basin Electric argue that paragraph
27 of Order No. 717–A overruled
paragraph 147 of Order No. 717 in
which the Commission stated that so
long as the preparation of system impact
studies ‘‘do[es] not implicate the day-today operation of the transmission
system, they are not transmission
functions.’’ 9 The parties request that the
Commission reconsider its statement in
Order No. 717–A.
6. Western Utilities argues that in
many instances, system impact studies
have nothing to do with day-to-day
operations of the transmission system.
Western Utilities states that some
studies are used to assess whether any
additional costs may be incurred in
order to provide the requested
transmission service. Western Utilities
further states that where such studies
are required, they trigger the process for
determining the modifications needed
to provide the service at some future
date and, thus, are not day-to-day
6 18
CFR 385.213(a)(2) (2009).
7 Order No. 717–A at P 27.
8 Id.
9 Order No. 717 at P 147.
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15:00 Apr 21, 2010
transmission operations. Western
Utilities requests that the Commission
clarify that studies related to
determining the upgrades necessary to
the transmission system to provide
service, including system impact
studies, do not qualify as Transmission
Function activities, because they fall
under the category of ‘‘long-range
planning.’’
7. EPSA responds to Western Utilities’
argument by stating that transmission
system impact studies do have an
impact on day-to-day transmission
operations as these studies provide
significant insight into non-public
development plans of market
participants and opportunities for
additional investments and that these
studies are a core function of
transmission providers.
8. Avista states that studies related to
interconnection requests, which identify
interconnection facilities needed to
interconnect a new generator as an
energy resource or network resource, do
not convey any rights to deliver
electricity to any specific customer or
point of delivery and do not implicate
the day-to-day operation of the
transmission system.
9. In the event that the Commission
does not grant the requested
clarification, Basin Electric asks the
Commission to extend the date for
compliance with paragraph 27 to 90
days after the date of this order.
Commission Determination:
10. We deny the requests to
reconsider paragraph 27 in Order No.
717–A. The Commission finds that
paragraph 27 of Order No. 717–A is not
inconsistent with the Commission’s
findings in paragraph 147 of Order No.
717. In essence, certain protestors argue
that the Commission’s finding in Order
No. 717–A that a ‘‘transmission function
employee’’ includes an employee
responsible for performing system
impact studies is inconsistent with the
Commission’s finding in Order No. 717
that so long as the preparation of system
impact studies ‘‘do[es[ not implicate the
day-to-day operation of the transmission
system, they are not transmission
functions.’’ 10 In order to reconcile these
seemingly inconsistent statements, these
Commission findings must be viewed in
the context of the protestors’ requests
for clarification. Specifically, in Order
No. 717 and Order No. 717–A, the
Commission determined whether
system impact studies performed
pursuant to narrowly described fact
scenarios would lead to a grant or denial
of transmission service.
11. In paragraph 147 of Order No. 717,
we granted a request for clarification
from Idaho Power Company that asked
whether long-range planning functions
such as integrated resource planning
and preparation of system impact
studies are transmission functions. The
Commission stated that ‘‘so long as these
activities do not implicate the day-today operation of the transmission
system, they are not transmission
functions.’’ 11 Thus, Order No. 717
responded to a narrow request for
clarification concerning integrated
resource planning and the conduct of
system impact studies for long-range
planning.12 The Commission did not
state in Order No. 717 that the conduct
of system impact studies is at all times
a long-range planning function, but only
recognized that, in some cases, the
preparation of system impact studies
might not implicate the day-to-day
operation of the transmission system.
The protestors are simply incorrect in
their assertion that the Commission
found in Order No. 717 that preparation
of a system impact study can never be
considered a transmission function.
12. Similarly, in paragraph 27 of
Order No. 717–A, the Commission
granted another narrow request for
clarification, which asked whether
transmission function employees
include just the employees who post on
the OASIS that a particular request has
been granted or denied or also those
employees who are responsible for
performing the underlying system
impact studies or otherwise determining
whether the transmission system can
support the requested services.13 In
response, the Commission first clarified
that personnel engaged in granting or
denying transmission service requests
are transmission function employees
because the act of granting or denying
transmission service requests is an
integral part of ‘‘planning, directing,
organizing or carrying out of day-to-day
transmission operations’’ 14 and then
elaborated, in response to the second
part of the clarification request that the
term ‘‘transmission function employee’’
includes an employee responsible for
performing system impact studies or
determining whether the transmission
system can support the requested
services because the act of granting or
denying transmission service requests is
an integral part of ‘‘carrying out of dayto-day transmission operations.’’ 15
11 Order
13 Order
14 Id.
10 Id.
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No. 717 at P 147.
12 Id.
No. 717–A at P 26.
P 27.
15 Id.
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13. While the language in paragraph
27 of Order No. 717–A could have been
more artfully worded, the Commission
in this paragraph intended to clarify
that, in the context of an employee
conducting a system impact study to
determine whether a transmission
system can support a transmission
service request, such an employee’s act
of performing a system impact study
would necessarily classify that
employee as a ‘‘transmission function
employee.’’ The Commission intended
the clarification in this paragraph to
apply only to the situation in which an
employee conducts a system impact
study to determine whether a
transmission system can support a
transmission service request, and not to
every situation in which an employee
conducts a system impact study.
14. In making the clarification in
paragraph 27 of Order No. 717–A, the
Commission focused on the § 358.3(h)
definition of ‘‘transmission function’’ as
the ‘‘* * * carrying out of day-to-day
transmission operations, including the
granting and denying of transmission
service requests.’’ 16
15. EEI argues that ‘‘it is the tests that
determine whether transmission is
available, not the testers.’’ 17 As such,
EEI contends that performing a system
impact study is not day-to-day control
over the operation of the transmission
system.18 While a ‘‘tester’’ may not make
the determination to grant or deny
transmission service, EEI’s argument
ignores the fact that it is the knowledge
that an employee obtains while
conducting a system impact study in
response to a transmission service
request that could be used to favor an
affiliate over its competition. For this
reason, we find that a ‘‘tester’’ who
grants and denies transmission service
requests by disclosing the results of a
test is engaging in ‘‘transmission
functions’’ as defined in § 358.3(h).19
16. However, we clarify that a system
impact study performed pursuant to a
request for energy resource
interconnection service or network
resource interconnection service is
similar to long-range planning and
therefore not a transmission function,
because the focus of such a study is to
determine the impact of the proposed
interconnection on the safety and
reliability of the transmission provider’s
transmission system, but without
conveying a right to transmission
16 18
CFR 358.3(h).
Nov. 16, 2009 Request for Clarification at
17 EEI
4.
18 Id.
19 18
CFR 358.3(h).
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service.20 Accordingly, we find that the
performance of a system impact study in
the context of evaluating an energy
resource interconnection service and
network resource interconnection
service is not a transmission function.
17. Similarly, we find that the
performance of a system impact study
that is not a part of day-to-day
transmission operations and performed
solely to determine the transmission
system upgrades necessary to provide
service is a part of long-range planning.
Accordingly, we clarify that a system
impact study performed solely to assess
what, if any, additional costs may be
incurred in order to provide
transmission service is not a
transmission function so long as the
performance of this system impact study
is not carried out as part of day-to-day
transmission operations, including the
granting or denying of transmission
service.
18. In light of the Commission’s
denial of the requests to reconsider
paragraph 27 of Order No. 717–A, the
Commission grants Basin Electric’s
request to extend the date of compliance
with paragraph 27 of Order No. 717–A
to ninety (90) days after the date of this
order.
ii. Marketing Functions
19. In Order No. 717–A, we clarified
in paragraph 40 that ‘‘if an employee of
a generation and transmission
cooperative simply serves retail load
and does not engage in activities
included in the ‘marketing functions’
definition in § 358.3, then this employee
is not a ‘marketing function employee’.’’
20 See Standardization of Small Generator
Interconnection Agreements and Procedures, Order
No. 2003, FERC Stats. & Regs. ¶ 31,146 (2003)
(Order No. 2003), order on reh’g, Order No. 2003–
A, FERC Stats. & Regs. ¶ 31,160, order on reh’g,
Order No. 2003–B, FERC Stats. & Regs. ¶ 31,171
(2004), order on reh’g, Order No. 2003–C, FERC
Stats. & Regs. ¶ 31,190 (2005), aff’d sub nom. Nat’l
Ass’n of Regulatory Util. Comm’rs v. FERC, 475
F.3d 1277 (D.C. Cir. 2007); see also Notice
Clarifying Compliance Procedures, 106 FERC
¶ 61,009 (2004). In Order No. 2003 at P 767, the
Commission stated the following: ‘‘Both Energy
Resource Interconnection Service and Network
Resource Interconnection Service provide for the
construction of Network Upgrades that would allow
the Interconnection Customer to flow the output of
its Generating Facility onto the Transmission
Provider’s Transmission System in a safe and
reliable manner. However, * * * neither Energy
Resource Interconnection Service nor Network
Resource Interconnection Service in and of itself
conveys the right to do so. Moreover, neither type
of Interconnection Service constitutes a reservation
of transmission capacity. The Interconnection
Customer, load or other market participant would
have to request either point-to-point or Network
Integration Transmission Service under the
Transmission Provider’s OATT in order to receive
the delivery service that is a prerequisite to flowing
power onto the system.’’
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Requests for Rehearing and
Clarification:
20. TAPS requests clarification that a
generation and transmission
cooperative’s sales to its distribution
cooperative members and a municipal
joint action agency’s sales to its
municipal distribution utility members
are analogous to a vertically integrated
utility’s retail sales function and,
therefore, the employees of a generation
and transmission cooperative, as well as
the employees of a municipal joint
action agency are not ‘‘marketing
function’’ employees for the purposes of
the Standards of Conduct. Similarly,
TDUS, NRECA, Tri-State, AEC and
Basin Electric request clarification that
wholesale sales of electric energy and
capacity by generation and transmission
electric cooperatives to their
distribution cooperative members do
not fall within the scope of marketing
functions. TAPS argues that paragraph
40 of Order No. 717–A creates
ambiguity. TAPS states that generation
and transmission cooperatives are not
technically ‘‘serv[ing] retail load.’’ TAPS
further argues that because generation
and transmission cooperatives are
engaged in functions almost identical to
serving retail load, there is an ambiguity
between what it thinks the Commission
intended to state and the language in
Order No. 717–A.
Commission Determination:
21. We will grant the requested
clarification regarding generation and
transmission cooperatives. In Order No.
888–A, the Commission clarified that if
a distribution cooperative sought open
access transmission service from a
Transmission Provider, only that
specific distribution cooperative, not its
member distribution cooperatives,
would be required to offer transmission
service. The Commission determined
that generation and transmission
cooperatives were not affiliates of their
distribution cooperatives for purposes of
application of the ‘‘reciprocal
transmission requirement’’ of Order No.
888.21 Subsequently, in Order No.
2004–A, we stated that generation and
transmission cooperatives are not
subject to the Standards of Conduct
consistent with the policies established
under Order No. 888.22 We find that the
adoption of the employee functional
approach in the Standards of Conduct
does not warrant a change in our
treatment of G&T cooperatives.
Therefore, we clarify that sales of power
by generation and transmission
21 Order No. 888–A, FERC Stats. & Regs.,
Regulations Preambles July 1996–December 2000
¶ 31,048 at 30,366.
22 Order No. 2004–A at P 27.
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cooperatives to their member generation
and transmission cooperatives or to
their member distribution cooperatives
do not constitute marketing functions
under the Standards of Conduct.
Similarly, a municipal joint action
agency, which is a public agency that
provides power to its municipal
member-owners, does not perform a
marketing function when selling power
to those members.
iii. Marketing Function Employees
22. In paragraph 80 of Order No. 717–
A, the Commission stated the following:
The Commission clarifies that an employee
in the legal, finance or regulatory division of
a jurisdictional entity, whose intermittent
day-to-day duties include the drafting and
redrafting of non-price terms and conditions
of, or exemptions to, umbrella agreements is
a ‘‘marketing function employee.’’ ‘‘Marketing
functions’’ are not limited to only price terms
and conditions of a contract, because nonprice terms and conditions of a contract
could contain information that an affiliate
could use to its advantage. For example,
delivery or hub locations in a contract are
non-price terms that could be used to favor
an affiliate. In addition, negotiated terms and
conditions could affect the substantive rights
of the parties. For this reason, we decline to
make a generic finding to limit ‘‘marketing
functions’’ to only price terms and
conditions, but will consider waiver requests
concerning an employee whose intermittent
duties involve drafting non-price terms and
conditions.23
23. In Order No. 717–B, the
Commission granted limited rehearing
and clarification to address expedited
clarification requests regarding
paragraph 80 of Order No. 717–A.
Specifically, the Commission stated the
following:
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The Commission clarifies that the language
in paragraph 80 of Order No. 717–A was
overly broad. The Commission further
clarifies that we intended to state in
paragraph 80 of Order No. 717–A that an
employee making business decisions about
non-price terms and conditions can be
considered a ‘‘marketing function employee’’
because that employee is actively and
personally engaged in marketing functions.
However, an employee who simply drafts or
redrafts a contract, including non-price terms
and conditions, without making business
decisions is not a ‘‘marketing function
employee.’’ 24
Requests for Rehearing and
Clarification:
24. Several additional parties have
requested clarification regarding
paragraph 80 of Order No. 717–A since
the issuance of Order No. 717–B, but
have raised the same issues as those
addressed in Order No. 717–B. Xcel also
23 Order
24 Order
No. 717–A at P 80.
No. 717–B at P 6.
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requests clarification that enterprise risk
management employees may provide
risk management services to both the
wholesale sales function and the
transmission function of a vertically
integrated and/or combination utility,
subject to the No Conduit Rule, and
consistent with Order No. 717.
Commission Determination:
25. Since the Commission has already
addressed the arguments concerning
paragraph 80 of Order No. 717–A in
Order No. 717–B, we find that the
requests for clarification regarding
paragraph 80 of Order No. 717–A have
been rendered moot. Similarly, we also
find that the Commission’s
determinations in Order No. 717–B
render Xcel’s request for clarification
moot. Xcel’s concern regarding the
application of the Standards of Conduct
to its risk management employees stems
from its interpretation of paragraph 80
of Order No. 717–A. However, in Order
No. 717–B, the Commission clarified
that it did not intend to depart from the
conclusions in paragraph 131 of Order
No. 717. In paragraph 131, which the
Commission reiterated in Order No.
717–B, we expressly stated that ‘‘a risk
management employee may develop
risk guidelines for both transmission
function employees and marketing
function employees.’’ 25 Accordingly,
the Commission finds that these
requests for rehearing concerning
paragraph 80 of Order No. 717–A have
been rendered moot.26
iv. Long-Range Planning, Procurement
and Other Interactions
26. In Order No. 717–A, the
Commission stated that ‘‘meetings
including both transmission function
and marketing function employees are
not barred under the Standards of
Conduct as long as the meetings do not
relate to transmission or marketing
functions.’’ 27 The Commission also
noted that the No Conduit Rule 28 still
applies to these meetings.
Requests for Rehearing and
Clarification:
27. E.ON U.S. is concerned that
paragraph 89 and paragraph 90 of Order
No. 717–A could act as a blanket
prohibition on any meeting or
communication between marketing and
transmission function employees in
which non-public transmission function
information is discussed. E.ON U.S.
requests clarification that the
25 Order
No. 717 at P 131.
note that risk management employees
remain subject to the No Conduit Rule, and are
prohibited from providing transmission function
information to marketing function employees.
27 Order No. 717–A at P 89.
28 18 CFR 358.6.
26 We
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Commission did not eliminate certain
exemptions in § 358.7 or the meetings in
which information shared under these
exemptions occurs. Specifically, E.ON
U.S. notes the ‘‘specific transaction
information’’ exemption in § 358.7(b); 29
the exemption allowing discussion of
compliance information relating to
Reliability Standards approved by the
Commission in § 358.7(h)(2)(i); 30 and
the exemption allowing discussion of
information necessary to restore
operation of the transmission system or
that may affect dispatch of generating
units in § 358.7(h)(2)(ii).31
Commission Determination:
28. We grant E.ON U.S.’s request for
clarification and confirm that the
Commission did not intend to limit or
eliminate the exemptions in § 358.7. We
note that employees remain subject to
the No Conduit Rule, and are prohibited
from providing transmission function
information to marketing function
employees.
v. Seller’s Own Production or Gathering
or Processing Facilities
29. In Order No. 717–A, the
Commission denied the request of
APGA to eliminate the exclusion for
sales of natural gas solely from a seller’s
own production and from a seller’s own
gathering or processing facilities from
the definition of ‘‘marketing function.’’ 32
The Commission also noted that section
4 of the Natural Gas Act prohibits a
pipeline from granting any undue
preference or advantage to any person or
subjecting any person to any undue
prejudice or disadvantage.33
Request for Clarification or Rehearing:
30. APGA requests that the
Commission clarify that,
notwithstanding any exemption from
the Standards of Conduct, a natural gas
transmission provider’s disclosure of
non-public transmission function
information to its gas sales employees or
those affiliated producers, gatherers and
processors constitutes the granting of an
‘‘undue preference or advantage’’ under
section 4 of the Natural Gas Act. APGA
argues that ‘‘the Commission is obligated
under the Act ‘to prevent discrimination
against shippers who must depend on
monopolistic pipelines for
transportation,’ and the disclosure of
non-public transmission function
information by pipelines to their sales
employees and those of its affiliates
clearly constitutes improper favoritism.’’
Accordingly, APGA asks that if the
29 18
CFR 358.7(b).
CFR 358.7(h)(2)(i).
31 18 CFR 358.7(h)(2)(ii).
32 Order No. 717–A at PP 55–58.
33 Id. P 58.
30 18
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Federal Register / Vol. 75, No. 77 / Thursday, April 22, 2010 / Rules and Regulations
Commission declines to grant the
requested clarification, then it should
grant rehearing on this issue and on
rehearing amend Order No. 717–A to
state that such disclosure is unlawful.
Commission Determination:
31. We deny APGA’s request for
clarification or rehearing of Order No.
717–A. The Commission previously
denied APGA’s request for rehearing in
Order No. 717–A and affirmed the
adoption of the exclusion in Order No.
717. Now, for the first time, APGA asks
that the Commission adopt a per se rule
that, notwithstanding any exclusion, a
natural gas transmission provider’s
disclosure of non-public transmission
function information to its gas sales
employees or its affiliated producers,
gatherers and processors constitutes the
granting of an ‘‘undue preference or
advantage’’ under section 4 of the
Natural Gas Act. As an initial matter, we
note that APGA raises this request for
rehearing for the first time in this
proceeding. We have held repeatedly
that it is inappropriate for a protestor to
raise new issues in a request for
rehearing because this practice is
disruptive to the administrative process
and denies parties the opportunity to
respond.34
32. We also find that APGA’s request
for clarification or rehearing is beyond
the scope of this proceeding. Although
APGA describes its filing as a request
for clarification or rehearing of Order
No. 717–A, in fact, APGA requests that
the Commission clarify section 4 of the
Natural Gas Act.35 The appropriate
forum to raise this request for an
interpretation of section 4 of the Natural
Gas Act would be in either a complaint
proceeding or a petition for declaratory
order. Accordingly, we deny APGA’s
request for clarification or rehearing in
this proceeding concerning section 4 of
the Natural Gas Act.
33. Although we deny APGA’s request
for rehearing and clarification, we note
that the exclusion must be read in the
context of the whole of the Standards of
Conduct. For example, section 358.2(a)
of the Commission’s regulations
specifies that ‘‘A transmission provider
must treat all transmission customers,
affiliated and non-affiliated, on a nondiscriminatory basis and must not make
or grant any undue preference or
advantage to any person or subject any
person to any undue prejudice or
disadvantage with respect to any
transportation of natural gas. * * *’’,
while section 358.2(d) further provides
that ‘‘A transmission provider must
provide equal access to non-public
transmission function information to all
its transmission customers, affiliated
and non-affiliated, except in the case of
confidential customer information or
Critical Energy Infrastructure
Information.’’
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
IV. Document Availability
HHS.
34. 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.
35. 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.
36. 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 e-mail at
ferconlinesupport@ferc.gov, or the
Public Reference Room at (202) 502–
8371, TTY (202) 502–8659. E-mail the
Public Reference Room at
public.referenceroom@ferc.gov.
V. Effective Date
37. Changes to Order No. 717–A
adopted in this order on rehearing and
clarification are effective July 21, 2010.
By the Commission.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
emcdonald on DSK2BSOYB1PROD with RULES
[FR Doc. 2010–9264 Filed 4–21–10; 8:45 am]
34 Baltimore
Gas and Electric Company, 91 FERC
¶ 61,270, at 61,922 (2000); Baltimore Gas and
Electric Company, 92 FERC ¶ 61,043, at 61,114
(2000); New York Independent System Operator,
Inc., 97 FERC ¶ 61,006, at 61,015 (2001); Carolina
Power & Light Company, 106 FERC ¶ 61,141, at P
15 (2004); CARE v. Calpine Energy Services, LP, 107
FERC ¶ 61,238, at P 7 (2004); PJM Interconnection,
LLC, 126 FERC ¶ 61,030, at P 15 (2009).
35 15 U.S.C. § 717c (2009).
VerDate Nov<24>2008
15:00 Apr 21, 2010
Jkt 220001
20913
BILLING CODE 6717–01–P
PO 00000
Food and Drug Administration
21 CFR Parts 1, 801, 803, 807, 812, 814,
820, 822, 860, 900, 1002, and 1040
[Docket No. FDA–2010–N–0010]
Center for Devices and Radiological
Health; New Address Information
AGENCY:
Food and Drug Administration,
ACTION: Final rule; technical
amendments.
SUMMARY: The Food and Drug
Administration (FDA) is amending
procedural regulations that pertain to
obtaining, submitting, executing, and
filing certain documents to reflect new
address information for the Center for
Devices and Radiological Health
(CDRH). All filings and other documents
that are subject to these regulations
must be directed to the new addresses.
This action is being taken to provide
accuracy and clarity to the agency’s
regulations.
DATES: This regulation is effective April
22, 2010.
FOR FURTHER INFORMATION CONTACT:
Domini Bean, Food and Drug
Administration, Center for Devices and
Radiological Health, 10903 New
Hampshire Ave., Bldg. 66, rm. 4422,
Silver Spring, MD 20993–0002, 301–
796–5733.
FDA is
amending its regulations in 21 CFR
parts 1, 801, 803, 807, 812, 814, 820,
822, 860, 900, 1002, and 1040 to reflect
new address information for certain
components of the agency’s CDRH. The
changes are the result of the relocation
of these offices to FDA’s White Oak
campus.
Publication of this document
constitutes final action under the
Administrative Procedures Act (5 U.S.C.
553). FDA has determined that notice
and public comment are unnecessary
because this amendment to the
regulations provides only technical
changes to update mailing addresses
and other information, and is
nonsubstantive.
SUPPLEMENTARY INFORMATION:
List of Subjects
21 CFR Part 1
Cosmetics, Drugs, Exports, Food
labeling, Imports, Labeling, Reporting
and recordkeeping requirements.
Frm 00017
Fmt 4700
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]]>Agencies
[Federal Register Volume 75, Number 77 (Thursday, April 22, 2010)]
[Rules and Regulations]
[Pages 20909-20913]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-9264]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
18 CFR Part 358
[Docket No. RM07-1-002; Order No. 717-C]
Standards of Conduct for Transmission Providers
Issued April 16, 2010.
AGENCY: Federal Energy Regulatory Commission.
ACTION: Order on Rehearing and Clarification.
-----------------------------------------------------------------------
SUMMARY: The Federal Energy Regulatory Commission (Commission) issued
Order No. 717-A to address requests for rehearing and make clearer the
Standards of Conduct as implemented by Order No. 717. The Commission
issued Order No. 717-B to address expedited requests for rehearing and
clarification concerning paragraph 80 of Order No. 717-A and whether an
employee who is not making business decisions about contract non-price
terms and conditions is considered a ``marketing function employee.''
This order addresses additional requests for rehearing and
clarification concerning Order No. 717-A.
DATES: Effective Date: This rule will become effective July 21, 2010.
FOR FURTHER INFORMATION CONTACT: Leonard Tao, Office of the General
Counsel--Energy Markets, Federal Energy Regulatory Commission, 888
First Street, NE., Washington, DC 20426, (202) 502-8214.
SUPPLEMENTARY INFORMATION:
Before Commissioners: Jon Wellinghoff, Chairman; Marc Spitzer,
Philip D. Moeller, and John R. Norris.
Order on Rehearing and Clarification
I. Introduction
1. On October 16, 2008, the Commission issued Order No. 717
amending the Standards of Conduct for Transmission Providers (the
Standards of Conduct or the Standards) to make them clearer and to
refocus the rules on the areas where there is the greatest potential
for abuse.\1\ On October 15, 2009, the Commission issued Order No. 717-
A to address requests for rehearing and clarification of Order No. 717,
largely affirming the reforms adopted in Order No. 717.\2\ On November
16, 2009, the Commission issued Order No. 717-B to address expedited
requests for rehearing and clarification concerning paragraph 80 of
Order No. 717-A and whether an employee who is not making business
decisions about contract non-price terms and conditions is considered a
``marketing function employee.'' \3\ In this order, the Commission
grants additional clarification concerning matters petitioners raised
regarding the Commission's determinations in Order No. 717-A.
---------------------------------------------------------------------------
\1\ Standards of Conduct for Transmission Providers, Order No.
717, 73 FR 63796 (Oct. 27, 2008), FERC Stats. & Regs. ] 31,280
(2008) (Order No. 717).
\2\ Standards of Conduct for Transmission Providers, Order No.
717-A, 74 FR 54463 (Oct. 22, 2009), FERC Stats. & Regs. ] 31,297
(2009) (Order No. 717-A).
\3\ Standards of Conduct for Transmission Providers, Order No.
717-B, 74 FR 60153 (Nov. 20, 2009), 129 FERC ] 61,123 (Nov. 16,
2009) (Order No. 717-B). On October 30, 2009, EEI filed a request
for expedited clarification of a single issue addressed in Order No.
717-A. The Commission determined that it should address this issue
expeditiously even though the time allowed under the regulations for
filing rehearing requests had not yet expired. For this reason, the
Commission issued Order No. 717-B on November 16, 2009, in which it
addressed a single clarification request of EEI, Western Utilities,
Otter Tail and Central Vermont. All other timely requests for
rehearing, i.e. those filed by November 16, 2009, are addressed in
this order.
---------------------------------------------------------------------------
II. Requests for Clarification and/or Rehearing
2. Edison Electric Institute (EEI), Transmission Dependent Utility
Systems (TDUS), Transmission Access Policy Study Group (TAPS), National
Rural Electric Cooperative Association (NRECA), Associated Electric
Cooperative (AEC), Basin Electric Power Cooperative (Basin Electric),
Xcel Energy Services (Xcel), E.ON U.S., Avista Corporation (Avista),
the American Public Gas Association (APGA) and Western Utilities \4\
filed requests for clarification, or in the alternative, requests for
rehearing. The Tri-State Generation and Transmission Association (Tri-
State) filed in support of the NRECA's request. The Electric Power
Supply Association (EPSA) filed a motion for leave to answer and an
answer to Western Utilities' request for clarification and
rehearing.\5\
---------------------------------------------------------------------------
\4\ Western Utilities is comprised of Arizona Public Service
Company, Avista Corporation, El Paso Electric Company, Idaho Power
Company, Pacific Gas and Electric Company, PacifiCorp, Portland
General Electric Company, Puget Sound Energy, Southern California
Edison Company, and Tucson Electric Power Company.
\5\ EPSA objects to Western Utilities' characterization of its
filing as a request for clarification.
---------------------------------------------------------------------------
[[Page 20910]]
III. Discussion
A. Procedural Matters
3. Rule 213(a)(2) of the Commission's Rules of Practice and
Procedure \6\ prohibits an answer to a request for rehearing unless
otherwise ordered by the decisional authority. We will accept the
EPSA's answer to Western Utilities' motion for clarification and/or
request for rehearing because it provided information that assisted us
in our decision-making process.
---------------------------------------------------------------------------
\6\ 18 CFR 385.213(a)(2) (2009).
---------------------------------------------------------------------------
B. Independent Functioning Rule
i. Transmission Function Employees
4. In paragraph 27 of Order No. 717-A, the Commission clarified
that personnel engaged in granting or denying transmission service
requests are transmission function employees because the act of
granting or denying transmission service requests is an integral part
of ``planning, directing, organizing or carrying out of day-to-day
transmission operations.'' \7\ The Commission then elaborated in this
paragraph that the term ``transmission function employee'' includes
``an employee responsible for performing system impact studies or
determining whether the transmission system can support the requested
services as this type of employee is planning, directing, organizing or
carrying out the day-to-day transmission operations.'' \8\
---------------------------------------------------------------------------
\7\ Order No. 717-A at P 27.
\8\ Id.
---------------------------------------------------------------------------
Requests for Rehearing and Clarification:
5. EEI, Western Utilities, Xcel, Avista and Basin Electric argue
that paragraph 27 of Order No. 717-A overruled paragraph 147 of Order
No. 717 in which the Commission stated that so long as the preparation
of system impact studies ``do[es] not implicate the day-to-day
operation of the transmission system, they are not transmission
functions.'' \9\ The parties request that the Commission reconsider its
statement in Order No. 717-A.
---------------------------------------------------------------------------
\9\ Order No. 717 at P 147.
---------------------------------------------------------------------------
6. Western Utilities argues that in many instances, system impact
studies have nothing to do with day-to-day operations of the
transmission system. Western Utilities states that some studies are
used to assess whether any additional costs may be incurred in order to
provide the requested transmission service. Western Utilities further
states that where such studies are required, they trigger the process
for determining the modifications needed to provide the service at some
future date and, thus, are not day-to-day transmission operations.
Western Utilities requests that the Commission clarify that studies
related to determining the upgrades necessary to the transmission
system to provide service, including system impact studies, do not
qualify as Transmission Function activities, because they fall under
the category of ``long-range planning.''
7. EPSA responds to Western Utilities' argument by stating that
transmission system impact studies do have an impact on day-to-day
transmission operations as these studies provide significant insight
into non-public development plans of market participants and
opportunities for additional investments and that these studies are a
core function of transmission providers.
8. Avista states that studies related to interconnection requests,
which identify interconnection facilities needed to interconnect a new
generator as an energy resource or network resource, do not convey any
rights to deliver electricity to any specific customer or point of
delivery and do not implicate the day-to-day operation of the
transmission system.
9. In the event that the Commission does not grant the requested
clarification, Basin Electric asks the Commission to extend the date
for compliance with paragraph 27 to 90 days after the date of this
order.
Commission Determination:
10. We deny the requests to reconsider paragraph 27 in Order No.
717-A. The Commission finds that paragraph 27 of Order No. 717-A is not
inconsistent with the Commission's findings in paragraph 147 of Order
No. 717. In essence, certain protestors argue that the Commission's
finding in Order No. 717-A that a ``transmission function employee''
includes an employee responsible for performing system impact studies
is inconsistent with the Commission's finding in Order No. 717 that so
long as the preparation of system impact studies ``do[es[ not implicate
the day-to-day operation of the transmission system, they are not
transmission functions.'' \10\ In order to reconcile these seemingly
inconsistent statements, these Commission findings must be viewed in
the context of the protestors' requests for clarification.
Specifically, in Order No. 717 and Order No. 717-A, the Commission
determined whether system impact studies performed pursuant to narrowly
described fact scenarios would lead to a grant or denial of
transmission service.
---------------------------------------------------------------------------
\10\ Id. See also Order No. 717-A at P 27.
---------------------------------------------------------------------------
11. In paragraph 147 of Order No. 717, we granted a request for
clarification from Idaho Power Company that asked whether long-range
planning functions such as integrated resource planning and preparation
of system impact studies are transmission functions. The Commission
stated that ``so long as these activities do not implicate the day-to-
day operation of the transmission system, they are not transmission
functions.'' \11\ Thus, Order No. 717 responded to a narrow request for
clarification concerning integrated resource planning and the conduct
of system impact studies for long-range planning.\12\ The Commission
did not state in Order No. 717 that the conduct of system impact
studies is at all times a long-range planning function, but only
recognized that, in some cases, the preparation of system impact
studies might not implicate the day-to-day operation of the
transmission system. The protestors are simply incorrect in their
assertion that the Commission found in Order No. 717 that preparation
of a system impact study can never be considered a transmission
function.
---------------------------------------------------------------------------
\11\ Order No. 717 at P 147.
\12\ Id.
---------------------------------------------------------------------------
12. Similarly, in paragraph 27 of Order No. 717-A, the Commission
granted another narrow request for clarification, which asked whether
transmission function employees include just the employees who post on
the OASIS that a particular request has been granted or denied or also
those employees who are responsible for performing the underlying
system impact studies or otherwise determining whether the transmission
system can support the requested services.\13\ In response, the
Commission first clarified that personnel engaged in granting or
denying transmission service requests are transmission function
employees because the act of granting or denying transmission service
requests is an integral part of ``planning, directing, organizing or
carrying out of day-to-day transmission operations'' \14\ and then
elaborated, in response to the second part of the clarification request
that the term ``transmission function employee'' includes an employee
responsible for performing system impact studies or determining whether
the transmission system can support the requested services because the
act of granting or denying transmission service requests is an integral
part of ``carrying out of day-to-day transmission operations.'' \15\
---------------------------------------------------------------------------
\13\ Order No. 717-A at P 26.
\14\ Id. P 27.
\15\ Id.
---------------------------------------------------------------------------
[[Page 20911]]
13. While the language in paragraph 27 of Order No. 717-A could
have been more artfully worded, the Commission in this paragraph
intended to clarify that, in the context of an employee conducting a
system impact study to determine whether a transmission system can
support a transmission service request, such an employee's act of
performing a system impact study would necessarily classify that
employee as a ``transmission function employee.'' The Commission
intended the clarification in this paragraph to apply only to the
situation in which an employee conducts a system impact study to
determine whether a transmission system can support a transmission
service request, and not to every situation in which an employee
conducts a system impact study.
14. In making the clarification in paragraph 27 of Order No. 717-A,
the Commission focused on the Sec. 358.3(h) definition of
``transmission function'' as the ``* * * carrying out of day-to-day
transmission operations, including the granting and denying of
transmission service requests.'' \16\
---------------------------------------------------------------------------
\16\ 18 CFR 358.3(h).
---------------------------------------------------------------------------
15. EEI argues that ``it is the tests that determine whether
transmission is available, not the testers.'' \17\ As such, EEI
contends that performing a system impact study is not day-to-day
control over the operation of the transmission system.\18\ While a
``tester'' may not make the determination to grant or deny transmission
service, EEI's argument ignores the fact that it is the knowledge that
an employee obtains while conducting a system impact study in response
to a transmission service request that could be used to favor an
affiliate over its competition. For this reason, we find that a
``tester'' who grants and denies transmission service requests by
disclosing the results of a test is engaging in ``transmission
functions'' as defined in Sec. 358.3(h).\19\
---------------------------------------------------------------------------
\17\ EEI Nov. 16, 2009 Request for Clarification at 4.
\18\ Id.
\19\ 18 CFR 358.3(h).
---------------------------------------------------------------------------
16. However, we clarify that a system impact study performed
pursuant to a request for energy resource interconnection service or
network resource interconnection service is similar to long-range
planning and therefore not a transmission function, because the focus
of such a study is to determine the impact of the proposed
interconnection on the safety and reliability of the transmission
provider's transmission system, but without conveying a right to
transmission service.\20\ Accordingly, we find that the performance of
a system impact study in the context of evaluating an energy resource
interconnection service and network resource interconnection service is
not a transmission function.
---------------------------------------------------------------------------
\20\ See Standardization of Small Generator Interconnection
Agreements and Procedures, Order No. 2003, FERC Stats. & Regs. ]
31,146 (2003) (Order No. 2003), order on reh'g, Order No. 2003-A,
FERC Stats. & Regs. ] 31,160, order on reh'g, Order No. 2003-B, FERC
Stats. & Regs. ] 31,171 (2004), order on reh'g, Order No. 2003-C,
FERC Stats. & Regs. ] 31,190 (2005), aff'd sub nom. Nat'l Ass'n of
Regulatory Util. Comm'rs v. FERC, 475 F.3d 1277 (D.C. Cir. 2007);
see also Notice Clarifying Compliance Procedures, 106 FERC ] 61,009
(2004). In Order No. 2003 at P 767, the Commission stated the
following: ``Both Energy Resource Interconnection Service and
Network Resource Interconnection Service provide for the
construction of Network Upgrades that would allow the
Interconnection Customer to flow the output of its Generating
Facility onto the Transmission Provider's Transmission System in a
safe and reliable manner. However, * * * neither Energy Resource
Interconnection Service nor Network Resource Interconnection Service
in and of itself conveys the right to do so. Moreover, neither type
of Interconnection Service constitutes a reservation of transmission
capacity. The Interconnection Customer, load or other market
participant would have to request either point-to-point or Network
Integration Transmission Service under the Transmission Provider's
OATT in order to receive the delivery service that is a prerequisite
to flowing power onto the system.''
---------------------------------------------------------------------------
17. Similarly, we find that the performance of a system impact
study that is not a part of day-to-day transmission operations and
performed solely to determine the transmission system upgrades
necessary to provide service is a part of long-range planning.
Accordingly, we clarify that a system impact study performed solely to
assess what, if any, additional costs may be incurred in order to
provide transmission service is not a transmission function so long as
the performance of this system impact study is not carried out as part
of day-to-day transmission operations, including the granting or
denying of transmission service.
18. In light of the Commission's denial of the requests to
reconsider paragraph 27 of Order No. 717-A, the Commission grants Basin
Electric's request to extend the date of compliance with paragraph 27
of Order No. 717-A to ninety (90) days after the date of this order.
ii. Marketing Functions
19. In Order No. 717-A, we clarified in paragraph 40 that ``if an
employee of a generation and transmission cooperative simply serves
retail load and does not engage in activities included in the
`marketing functions' definition in Sec. 358.3, then this employee is
not a `marketing function employee'.''
Requests for Rehearing and Clarification:
20. TAPS requests clarification that a generation and transmission
cooperative's sales to its distribution cooperative members and a
municipal joint action agency's sales to its municipal distribution
utility members are analogous to a vertically integrated utility's
retail sales function and, therefore, the employees of a generation and
transmission cooperative, as well as the employees of a municipal joint
action agency are not ``marketing function'' employees for the purposes
of the Standards of Conduct. Similarly, TDUS, NRECA, Tri-State, AEC and
Basin Electric request clarification that wholesale sales of electric
energy and capacity by generation and transmission electric
cooperatives to their distribution cooperative members do not fall
within the scope of marketing functions. TAPS argues that paragraph 40
of Order No. 717-A creates ambiguity. TAPS states that generation and
transmission cooperatives are not technically ``serv[ing] retail
load.'' TAPS further argues that because generation and transmission
cooperatives are engaged in functions almost identical to serving
retail load, there is an ambiguity between what it thinks the
Commission intended to state and the language in Order No. 717-A.
Commission Determination:
21. We will grant the requested clarification regarding generation
and transmission cooperatives. In Order No. 888-A, the Commission
clarified that if a distribution cooperative sought open access
transmission service from a Transmission Provider, only that specific
distribution cooperative, not its member distribution cooperatives,
would be required to offer transmission service. The Commission
determined that generation and transmission cooperatives were not
affiliates of their distribution cooperatives for purposes of
application of the ``reciprocal transmission requirement'' of Order No.
888.\21\ Subsequently, in Order No. 2004-A, we stated that generation
and transmission cooperatives are not subject to the Standards of
Conduct consistent with the policies established under Order No.
888.\22\ We find that the adoption of the employee functional approach
in the Standards of Conduct does not warrant a change in our treatment
of G&T cooperatives. Therefore, we clarify that sales of power by
generation and transmission
[[Page 20912]]
cooperatives to their member generation and transmission cooperatives
or to their member distribution cooperatives do not constitute
marketing functions under the Standards of Conduct. Similarly, a
municipal joint action agency, which is a public agency that provides
power to its municipal member-owners, does not perform a marketing
function when selling power to those members.
---------------------------------------------------------------------------
\21\ Order No. 888-A, FERC Stats. & Regs., Regulations Preambles
July 1996-December 2000 ] 31,048 at 30,366.
\22\ Order No. 2004-A at P 27.
---------------------------------------------------------------------------
iii. Marketing Function Employees
22. In paragraph 80 of Order No. 717-A, the Commission stated the
following:
The Commission clarifies that an employee in the legal, finance
or regulatory division of a jurisdictional entity, whose
intermittent day-to-day duties include the drafting and redrafting
of non-price terms and conditions of, or exemptions to, umbrella
agreements is a ``marketing function employee.'' ``Marketing
functions'' are not limited to only price terms and conditions of a
contract, because non-price terms and conditions of a contract could
contain information that an affiliate could use to its advantage.
For example, delivery or hub locations in a contract are non-price
terms that could be used to favor an affiliate. In addition,
negotiated terms and conditions could affect the substantive rights
of the parties. For this reason, we decline to make a generic
finding to limit ``marketing functions'' to only price terms and
conditions, but will consider waiver requests concerning an employee
whose intermittent duties involve drafting non-price terms and
conditions.\23\
---------------------------------------------------------------------------
\23\ Order No. 717-A at P 80.
23. In Order No. 717-B, the Commission granted limited rehearing
and clarification to address expedited clarification requests regarding
paragraph 80 of Order No. 717-A. Specifically, the Commission stated
---------------------------------------------------------------------------
the following:
The Commission clarifies that the language in paragraph 80 of
Order No. 717-A was overly broad. The Commission further clarifies
that we intended to state in paragraph 80 of Order No. 717-A that an
employee making business decisions about non-price terms and
conditions can be considered a ``marketing function employee''
because that employee is actively and personally engaged in
marketing functions. However, an employee who simply drafts or
redrafts a contract, including non-price terms and conditions,
without making business decisions is not a ``marketing function
employee.'' \24\
---------------------------------------------------------------------------
\24\ Order No. 717-B at P 6.
Requests for Rehearing and Clarification:
24. Several additional parties have requested clarification
regarding paragraph 80 of Order No. 717-A since the issuance of Order
No. 717-B, but have raised the same issues as those addressed in Order
No. 717-B. Xcel also requests clarification that enterprise risk
management employees may provide risk management services to both the
wholesale sales function and the transmission function of a vertically
integrated and/or combination utility, subject to the No Conduit Rule,
and consistent with Order No. 717.
Commission Determination:
25. Since the Commission has already addressed the arguments
concerning paragraph 80 of Order No. 717-A in Order No. 717-B, we find
that the requests for clarification regarding paragraph 80 of Order No.
717-A have been rendered moot. Similarly, we also find that the
Commission's determinations in Order No. 717-B render Xcel's request
for clarification moot. Xcel's concern regarding the application of the
Standards of Conduct to its risk management employees stems from its
interpretation of paragraph 80 of Order No. 717-A. However, in Order
No. 717-B, the Commission clarified that it did not intend to depart
from the conclusions in paragraph 131 of Order No. 717. In paragraph
131, which the Commission reiterated in Order No. 717-B, we expressly
stated that ``a risk management employee may develop risk guidelines
for both transmission function employees and marketing function
employees.'' \25\ Accordingly, the Commission finds that these requests
for rehearing concerning paragraph 80 of Order No. 717-A have been
rendered moot.\26\
---------------------------------------------------------------------------
\25\ Order No. 717 at P 131.
\26\ We note that risk management employees remain subject to
the No Conduit Rule, and are prohibited from providing transmission
function information to marketing function employees.
---------------------------------------------------------------------------
iv. Long-Range Planning, Procurement and Other Interactions
26. In Order No. 717-A, the Commission stated that ``meetings
including both transmission function and marketing function employees
are not barred under the Standards of Conduct as long as the meetings
do not relate to transmission or marketing functions.'' \27\ The
Commission also noted that the No Conduit Rule \28\ still applies to
these meetings.
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\27\ Order No. 717-A at P 89.
\28\ 18 CFR 358.6.
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Requests for Rehearing and Clarification:
27. E.ON U.S. is concerned that paragraph 89 and paragraph 90 of
Order No. 717-A could act as a blanket prohibition on any meeting or
communication between marketing and transmission function employees in
which non-public transmission function information is discussed. E.ON
U.S. requests clarification that the Commission did not eliminate
certain exemptions in Sec. 358.7 or the meetings in which information
shared under these exemptions occurs. Specifically, E.ON U.S. notes the
``specific transaction information'' exemption in Sec. 358.7(b); \29\
the exemption allowing discussion of compliance information relating to
Reliability Standards approved by the Commission in Sec.
358.7(h)(2)(i); \30\ and the exemption allowing discussion of
information necessary to restore operation of the transmission system
or that may affect dispatch of generating units in Sec.
358.7(h)(2)(ii).\31\
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\29\ 18 CFR 358.7(b).
\30\ 18 CFR 358.7(h)(2)(i).
\31\ 18 CFR 358.7(h)(2)(ii).
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Commission Determination:
28. We grant E.ON U.S.'s request for clarification and confirm that
the Commission did not intend to limit or eliminate the exemptions in
Sec. 358.7. We note that employees remain subject to the No Conduit
Rule, and are prohibited from providing transmission function
information to marketing function employees.
v. Seller's Own Production or Gathering or Processing Facilities
29. In Order No. 717-A, the Commission denied the request of APGA
to eliminate the exclusion for sales of natural gas solely from a
seller's own production and from a seller's own gathering or processing
facilities from the definition of ``marketing function.'' \32\ The
Commission also noted that section 4 of the Natural Gas Act prohibits a
pipeline from granting any undue preference or advantage to any person
or subjecting any person to any undue prejudice or disadvantage.\33\
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\32\ Order No. 717-A at PP 55-58.
\33\ Id. P 58.
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Request for Clarification or Rehearing:
30. APGA requests that the Commission clarify that, notwithstanding
any exemption from the Standards of Conduct, a natural gas transmission
provider's disclosure of non-public transmission function information
to its gas sales employees or those affiliated producers, gatherers and
processors constitutes the granting of an ``undue preference or
advantage'' under section 4 of the Natural Gas Act. APGA argues that
``the Commission is obligated under the Act `to prevent discrimination
against shippers who must depend on monopolistic pipelines for
transportation,' and the disclosure of non-public transmission function
information by pipelines to their sales employees and those of its
affiliates clearly constitutes improper favoritism.'' Accordingly, APGA
asks that if the
[[Page 20913]]
Commission declines to grant the requested clarification, then it
should grant rehearing on this issue and on rehearing amend Order No.
717-A to state that such disclosure is unlawful.
Commission Determination:
31. We deny APGA's request for clarification or rehearing of Order
No. 717-A. The Commission previously denied APGA's request for
rehearing in Order No. 717-A and affirmed the adoption of the exclusion
in Order No. 717. Now, for the first time, APGA asks that the
Commission adopt a per se rule that, notwithstanding any exclusion, a
natural gas transmission provider's disclosure of non-public
transmission function information to its gas sales employees or its
affiliated producers, gatherers and processors constitutes the granting
of an ``undue preference or advantage'' under section 4 of the Natural
Gas Act. As an initial matter, we note that APGA raises this request
for rehearing for the first time in this proceeding. We have held
repeatedly that it is inappropriate for a protestor to raise new issues
in a request for rehearing because this practice is disruptive to the
administrative process and denies parties the opportunity to
respond.\34\
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\34\ Baltimore Gas and Electric Company, 91 FERC ] 61,270, at
61,922 (2000); Baltimore Gas and Electric Company, 92 FERC ] 61,043,
at 61,114 (2000); New York Independent System Operator, Inc., 97
FERC ] 61,006, at 61,015 (2001); Carolina Power & Light Company, 106
FERC ] 61,141, at P 15 (2004); CARE v. Calpine Energy Services, LP,
107 FERC ] 61,238, at P 7 (2004); PJM Interconnection, LLC, 126 FERC
] 61,030, at P 15 (2009).
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32. We also find that APGA's request for clarification or rehearing
is beyond the scope of this proceeding. Although APGA describes its
filing as a request for clarification or rehearing of Order No. 717-A,
in fact, APGA requests that the Commission clarify section 4 of the
Natural Gas Act.\35\ The appropriate forum to raise this request for an
interpretation of section 4 of the Natural Gas Act would be in either a
complaint proceeding or a petition for declaratory order. Accordingly,
we deny APGA's request for clarification or rehearing in this
proceeding concerning section 4 of the Natural Gas Act.
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\35\ 15 U.S.C. Sec. 717c (2009).
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33. Although we deny APGA's request for rehearing and
clarification, we note that the exclusion must be read in the context
of the whole of the Standards of Conduct. For example, section 358.2(a)
of the Commission's regulations specifies that ``A transmission
provider must treat all transmission customers, affiliated and non-
affiliated, on a non-discriminatory basis and must not make or grant
any undue preference or advantage to any person or subject any person
to any undue prejudice or disadvantage with respect to any
transportation of natural gas. * * *'', while section 358.2(d) further
provides that ``A transmission provider must provide equal access to
non-public transmission function information to all its transmission
customers, affiliated and non-affiliated, except in the case of
confidential customer information or Critical Energy Infrastructure
Information.''
IV. Document Availability
34. 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.
35. 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.
36. 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 e-mail at
ferconlinesupport@ferc.gov, or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. E-mail the Public Reference Room at
public.referenceroom@ferc.gov.
V. Effective Date
37. Changes to Order No. 717-A adopted in this order on rehearing
and clarification are effective July 21, 2010.
By the Commission.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2010-9264 Filed 4-21-10; 8:45 am]
BILLING CODE 6717-01-P
