Pipeline Safety: Expanding the Use of Excess Flow Valves in Gas Distribution Systems to Applications Other Than Single-Family Residences, 70987-71002 [2016-24817]

Download as PDF ehiers on DSK5VPTVN1PROD with RULES Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations agent for service, or an organization’s president constitutes service upon that person. (g) Report and recommendation. The Administrative Law Judge must issue a report and recommendation at the close of the record. The report and recommendation must: (1) Contain findings of fact and conclusions of law and the grounds for the decision based on the material issues of fact or law presented on the record; (2) Be served on the parties to the proceeding; and (3) Be issued no later than 25 days after receipt of the petition for review by the Associate Administrator of Pipeline Safety. (h) Petition for reconsideration. (1) A party aggrieved by the Administrative Law Judge’s report and recommendation, may file a petition for reconsideration with the Associate Administrator of Pipeline Safety within one day of service of the report and recommendation. The opposing party may file a response to the petition for reconsideration within one day of service of a petition for reconsideration. (2) The Associate Administrator of Pipeline Safety must issue a final agency decision within three days of service of the final pleading outlined in paragraph (h)(1) of this section, but no later than 30 days after receipt of the original petition for review. (3) The Associate Administrator of Pipeline Safety’s decision on the merits of a petition for reconsideration constitutes the agency’s final decision. (i) Judicial review. After the issuance of a final agency decision pursuant to paragraph (c)(2) or (h)(3) of this section, or the issuance of a written determination by the Administrator pursuant to paragraph (j) of this section, a person subject to, and aggrieved by, an emergency order issued under section 190.236 may seek judicial review of the order in the appropriate District Court of the United States. The filing of an action seeking judicial review does not stay or modify the force and effect of the agency’s final decision under paragraph (c)(2) or (h)(3) of this section, or the written determination under paragraph (j) of this section, unless stayed or modified by the Administrator. (j) Expiration of order. If the Associate Administrator of Pipeline Safety, or the Administrative Law Judge, where appropriate, has not disposed of the petition for review within 30 days of receipt, the emergency order will cease to be effective unless the Administrator issuing the emergency order determines, in writing, that the imminent hazard VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 providing a basis for the emergency order continues to exist. (k) Time. In computing any period of time prescribed by this part or by an order issued by the Administrative Law Judge, the day of filing of the petition for review or of any other act, event, or default from which the designated period of time begins to run will not be included. The last day of the period so computed will be included, unless it is a Saturday, Sunday, or Federal holiday, in which event the period runs until the end of the next day which is not one of the aforementioned days. Issued in Washington, DC, on October 6, 2016, under authority delegated in 49 CFR 1.97. Marie Therese Dominguez, Administrator. [FR Doc. 2016–24788 Filed 10–13–16; 8:45 am] BILLING CODE 4910–60–P DEPARTMENT OF TRANSPORTATION Pipeline and Hazardous Materials Safety Administration 49 CFR Part 192 [Docket No. PHMSA–2011–0009; Amdt. No 192–121] RIN 2137–AE71 Pipeline Safety: Expanding the Use of Excess Flow Valves in Gas Distribution Systems to Applications Other Than Single-Family Residences Pipeline and Hazardous Materials Safety Administration (PHMSA), DOT. ACTION: Final rule. AGENCY: Excess flow valves (EFV), which are safety devices installed on natural gas distribution pipelines to reduce the risk of accidents, are currently required for new or replaced gas service lines servicing single-family residences (SFR), as that phrase is defined in 49 CFR 192.383(a). This final rule makes changes to part 192 to expand this requirement to include new or replaced branched service lines servicing SFRs, multifamily residences, and small commercial entities consuming gas volumes not exceeding 1,000 Standard Cubic Feet per Hour (SCFH). PHMSA is also amending part 192 to require the use of either manual service line shut-off valves (e.g., curb valves) or EFVs, if appropriate, for new or replaced service lines with meter capacities exceeding 1,000 SCFH. Lastly, this final rule requires operators to notify customers of their right to request installation of an EFV on service SUMMARY: PO 00000 Frm 00065 Fmt 4700 Sfmt 4700 70987 lines that are not being newly installed or replaced. PHMSA has left the question of who bears the cost of installing EFVs on service lines not being newly installed or replaced to the operator’s rate-setter. DATES: This final rule is effective April 14, 2017. FOR FURTHER INFORMATION CONTACT: Technical questions: Vincent Holohan, General Engineer, by telephone at 202–366–1933 or by electronic mail at vincent.holohan@ dot.gov. General information: Robert Jagger, Technical Writer, by telephone at 202– 366–4361 or by electronic mail at robert.jagger@dot.gov. SUPPLEMENTARY INFORMATION: I. Executive Summary A. Purpose of the Regulatory Action EFVs can reduce the risk of explosions in natural gas distribution pipelines by shutting off unplanned, excessive gas flows. These events are primarily the result of excavation damage to service lines that occurs between the gas main and the customer’s building. Based on the comments to this rulemaking, PHMSA experience, and various studies, PHMSA has determined that the safety benefits of expanding the use of EFVs to new or entirely replaced distribution branch services (gas service lines that begin at an existing service line or that are installed concurrently with primary service lines but serve separate residences), multifamily facilities, and small commercial facilities is appropriate from a technical, economical, and operational feasibility standpoint. B. Summary of the Major Provisions of the Regulatory Action Pursuant to Section 22 of the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011, this final rule amends the Federal pipeline safety regulations by adding four new categories of service for which EFV installation will be required. These four new categories are for new and entirely replaced services. The existing EFV installation requirement for SFRs served by a single service line remains unchanged. The new categories of service are as follows: • Branched service lines to a SFR installed concurrently with the primary SFR service line (a single EFV may be installed to protect both lines); • Branched service lines to a SFR installed off a previously installed SFR service line that does not contain an EFV; E:\FR\FM\14OCR1.SGM 14OCR1 70988 Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations • Multifamily installations, including duplexes, triplexes, fourplexes, and other small multifamily buildings (e.g., apartments, condominiums) with known customer loads at time of service installation, based on installed meter capacity, up to 1,000 SCFH per service; 1 and • A single, small commercial customer served by a single service line, with a known customer load at time of service installation, based on installed meter capacity, of up to 1,000 SCFH per service. Operators will be required to give all customers notice of the option to request an EFV installation, except where such installation is not required under § 192.383(c) (i.e., where the service line does not operate at a pressure of 10 psig or greater through the year, the operator has experienced contaminants in the gas stream that could interfere with EFV operation, an EFV could interfere with operation and maintenance activities, or an EFV meeting performance standards in § 192.381 is not available). Finally, this final rule also amends the Federal pipeline safety regulations by requiring curb valves, or EFVs, if appropriate, for applications operating above 1,000 SCFH. C. Costs and Benefits PHMSA estimates a total impacted community of 4,448 operators for this rule (3,119 master meter/small LPG operators who will need to comply with notification requirements and 1,329 natural gas distribution operators who will need to install valves and comply with notification requirements) and 222,114 service lines per year on average. It is expected to generate safety benefits in the form of reduced fatalities, injuries, lost product, and other property damage from certain types of preventable incidents in gas distribution pipelines. The overall benefits over a 50-year period were estimated at the annual equivalent of $5.5 million per year versus $10.6 million in compliance costs when calculated using a 7 percent discount rate. When using a 3 percent discount rate, the total benefits of the rule were estimated at $10.5 million while the costs were estimated at $12.0 million. ehiers on DSK5VPTVN1PROD with RULES II. Background A. Excess Flow Valves and Curb Valves An EFV is a mechanical safety device installed inside a natural gas distribution service line between the 1 The average single-family home uses about 200 standard cubic feet of gas per day and individual apartment units use even less. VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 street and residential meter. If there is a significant increase in the flow of gas (e.g., due to a damaged line), the EFV will ‘‘trip’’ or close to minimize the flow of gas through the line and thus, the amount of gas escaping into the atmosphere. During normal use, the valve is kept pushed open against oncoming gas flow by a spring. EFVs are designed so that general usage, such as turning on appliances, will not shut the valve. However, during a significant increase in the flow of gas (e.g., due to a damaged line), the spring cannot overcome the force of gas, and the valve will close and stay closed until the correct pressure is restored. When the correct pressure is restored, the EFV automatically resets itself. Curb valves are installed below grade in a service line at or near the property line with a protective curb box or standpipe for quick subsurface access and are operated by use of a removable key or specialized wrench. B. The South Riding, VA, Incident On July 7, 1998, in South Riding, VA, an explosion stemming from a residential service line resulted in one death and three injuries. It is not known if the explosion occurred on a branched or non-branched service line, but PHMSA believes that this final rule or PHMSA’s previous rule requiring EFVs on single lines serving SFRs 1 would, at a minimum, have mitigated the consequences of the explosion. An investigation by the National Transportation Safety Board (NTSB) found the explosion likely would not have occurred if an EFV had been installed on the service line leading to this single-family home. As a result of its investigation, on June 22, 2001, the NTSB issued Safety Recommendation P–01–2, recommending that PHMSA ‘‘require that EFVs be installed in all new and renewed gas service lines, regardless of a customer’s classification (i.e., not just lines serving single-family residences), when the operating conditions are compatible with readily available valves.’’ C. PHMSA’s EFV Studies and Evaluation Report In December 2005, a multistakeholder group convened by PHMSA published a report titled: ‘‘Integrity Management for Gas Distribution: Report of Phase I Investigations.’’ 2 The 1 ‘‘Pipeline Safety: Integrity Management Programs for Gas Distribution Pipelines,’’ 74 FR 63906 (December 4, 2009), RIN 2137–AE15. 2 http://www.regulations.gov/ contentStreamer?documentId=PHMSA-RSPA-200419854-0070&attachmentNumber=1&disposition= attachment&contentType=pdf PO 00000 Frm 00066 Fmt 4700 Sfmt 4700 report recommended that ‘‘[A]s part of its distribution integrity management plan, an operator should consider the mitigative value of EFVs. EFVs meeting performance criteria in § 192.381 and installed in accordance with § 192.383 may reduce the need for other mitigation options.’’ In an effort to study the possible benefits of expanding EFVs beyond SFR applications, PHMSA began development of an Interim Evaluation in early 2009. In June and August of that year, PHMSA held public meetings on NTSB Recommendation P–01–2 with participants from the following major stakeholder groups: the National Association of Regulatory Utility Commissioners, the National Association of Pipeline Safety Representatives, the International Association of Fire Chiefs, the National Association of State Fire Marshals, natural gas distribution operators, trade associations, manufacturers, and the Pipeline Safety Trust. On December 4, 2009, PHMSA amended the pipeline safety regulations to require the use of EFVs for new or replaced gas lines servicing SFRs.3 While this requirement met the mandate of the Pipeline Inspection, Protection, Enforcement, and Safety Act enacted in 2006, other distribution lines, including those that served branched SFRs, apartment buildings, other multiresidential dwellings, commercial properties, and industrial service lines, were still not required to use EFVs. These structures are susceptible to the same risks as SFR service lines. PHMSA, already aware of this risk, issued a report in 2010 titled: ‘‘Interim Evaluation: NTSB Recommendation P– 01–2 Excess Flow Valves in Applications Other Than Service Lines Serving One SFR’’ (Interim Evaluation),4 which studied the possible expansion of EFVs beyond SFRs and the challenges involved with such expansion. The Interim Evaluation also addressed other 3 ‘‘Pipeline Safety: Integrity Management Programs for Gas Distribution Pipelines,’’ December 4, 2009, (74 FR 63906) RIN 2137–AE15. 4 The purpose of the Interim Evaluation was to respond to NTSB Safety Recommendation P–01–02 and evaluate the possibility of expansion of EFVs to applications other than service lines serving one single-family residence (above 10 psig). The report also built a foundation for an economic analysis, considered the need for enhanced technical standards or guidelines, and suggested that any new technical standards include criteria for pressure drops across the EFV. The Interim Evaluation can be found at the following link: http:// www.regulations.gov/contentStreamer? documentId=PHMSA-2011-0009-0002& attachmentNumber=1&disposition=attachment& contentType=pdf. The Interim Evaluation was finalized in 2015 based on comments to the Interim Report. E:\FR\FM\14OCR1.SGM 14OCR1 Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations practical alternatives, such as the use of manual isolation devices (e.g., curb valves) to quickly cut off the uncontrolled flow of gas in an emergency. The Interim Evaluation also identified challenges related to the feasibility and practicality of the proposed solutions, as well as significant cost and benefit factors. The report found that there were no other devices or viable options to shut off gas supply quickly when gas service lines ruptured. The Evaluation 5 was finalized in 2015, based on comments to the Interim Evaluation, input from the meetings, and comments to the Advance Notice of Proposed Rulemaking (ANPRM) discussed below. Both reports can be found in Docket PHMSA–2011–0009. ehiers on DSK5VPTVN1PROD with RULES D. Advance Notice of Proposed Rulemaking PHMSA published an ANPRM for gas pipelines on November 25, 2011 (76 FR 72666), asking the public to comment on the findings of the Interim Evaluation and issues relating to the expanded use of EFVs in gas distribution systems. PHMSA also sought comments from gas distribution operators on their experiences using EFVs, including: • Technical challenges of installing EFVs on services other than SFRs; • Categories of service to be considered for expanded EFV use; • Cost factors; • Data analysis in the Interim Evaluation; • Technical standards for EFV devices; and • Potential safety and societal benefits, small-business and environmental impacts, and the costs of modifying the existing regulatory requirements. PHMSA reviewed all of the comments received in response to the ANPRM. The comments received from the trade associations largely supported expanded EFV use, with certain limitations. Individual operators raised concerns about expanded EFV use that were generally related to logistics and implementation. Comments from municipalities reflected a concern that State laws that were already in place could conflict with new Federal requirements. The NTSB expressed strong support for increased EFV use. The ANPRM comments collectively helped PHMSA finalize the Interim Evaluation and determine what 5 http://www.regulations.gov/contentStreamer? documentId=PHMSA-2011-0009-0027&attachment Number=1&disposition=attachment& contentType=pdf. VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 regulatory changes to propose in the Notice of Proposed Rulemaking (NPRM). E. Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011 In January of 2012, President Obama signed the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011, which required PHMSA to study the possibility of expanding the use of EFVs beyond SFRs and issue a final report to Congress on the evaluation of the NTSB’s recommendation on EFVs within 2 years after enactment of the Act. PHMSA was also required to issue regulations, if appropriate, requiring the use of EFVs or equivalent technology for new or entirely replaced gas distribution branch services, multifamily facilities, and small commercial facilities if economically, technically and operationally feasible. F. Notice of Proposed Rulemaking PHMSA published an NPRM (80 FR 41460) on July 15, 2015, asking the public to comment on the findings of the finalized Evaluation and PHMSA’s proposals relating to the expanded use of EFVs in gas distribution systems. PHMSA proposed a rule that would: • Expand the EFV requirement to include new or replaced branched service lines servicing SFRs, multifamily residences, and small commercial entities consuming gas volumes not exceeding 1,000 SCFH; • Require the use of manual service line shut-off valves (e.g., curb valves) for new or replaced service lines with meter capacities exceeding 1,000 SCFH; • Require operators to notify customers of their right to request installation of an EFV on existing service lines; and • Leave the question of who bears the cost of installing EFVs on service lines not being newly installed or replaced to the operator, customer, and the appropriate State regulatory agency. III. Gas Pipeline Advisory Committee The Technical Pipeline Safety Standards Committee (otherwise commonly referred to as the Gas Pipeline Advisory Committee (GPAC)) is a statutorily mandated advisory committee that advises PHMSA on proposed safety standards, risk assessments, and safety policies for natural gas pipelines. The GPAC was established under the Federal Advisory Committee Act (Pub. L. 92–463, 5 U.S.C. App. 1–16) and the Federal Pipeline Safety Statutes (49 U.S.C. Chap. 601). The committee consists of 15 members, with membership equally divided among Federal and State agencies, the PO 00000 Frm 00067 Fmt 4700 Sfmt 4700 70989 regulated industry, and the public. The GPAC advises PHMSA on the technical feasibility, practicability, and costeffectiveness of each proposed natural gas pipeline safety standard. On December 17, 2015, the GPAC met via a teleconference facilitated by PHMSA at PHMSA’s headquarters in Washington, DC. During the meeting, the GPAC considered the specific regulatory proposals set forth in the NPRM and discussed the various comments and edits to the NPRM proposed by the pipeline industry and the public. The GPAC, in a unanimous 8–0 vote, found the NPRM, as published in the Federal Register, and the Draft Regulatory Evaluation to be technically feasible, reasonable, cost-effective, and practicable, if (1) changes were made relative to § 192.385 paragraphs (a) and (c), as amended during the meeting; and (2) PHMSA incorporated the preamble language regarding documentation of customer notification in § 192.383(f). The GPAC recommended that PHMSA adopt the following changes: • Curb Valve Accessibility for First Responders: PHMSA’s proposal in the NPRM stated that manual service line shut-off valves are ‘‘a curb valve or other manually operated valve located near the service main or a common source of supply that is accessible to first responders and operator personnel [. . .] in the event of an emergency.’’ The GPAC recommended that the final rule remove language requiring proposed manual service line shut-off valves be accessible to ‘‘first responders and operator personnel.’’ Instead, the GPAC suggested that the rule require such valves be ‘‘accessible to operator personnel or other personnel authorized by the operator.’’ Several members of the GPAC shared the concerns of industry commenters that first responders would attempt to operate these manual service line shut-off valves without operator consent or authorization, which might lead to further or otherwise unforeseen consequences, including service outages. By allowing such valves to be used by ‘‘other personnel authorized by the operator,’’ operators could have discretion to ensure that people familiar with the gas distribution systems in question be qualified and authorized to operate manual service line shut-off valves, which might include properly trained emergency responders. • Curb Valve Maintenance: PHMSA’s proposal in the NPRM defined a manual service line shut-off valve as ‘‘a curb valve or other manually operated valve located near the service main or a common source of supply that is accessible to first responders and E:\FR\FM\14OCR1.SGM 14OCR1 70990 Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations ehiers on DSK5VPTVN1PROD with RULES operator personnel to manually shut off gas flow to the service line in the event of an emergency.’’ Several commenters noted that this definition could cause confusion and the potential misinterpretation that these curb valves would be subject to the maintenance requirements at § 192.747, which states that ‘‘each valve, the use of which may be necessary for the safe operation of a distribution system, must be checked and serviced at intervals not exceeding 15 months but at least once each calendar year.’’ The GPAC recommended that manual service line shut-off valves installed under section § 192.385 be subject to regular, but less prescriptive, scheduled maintenance, as documented by the operator and consistent with the valve manufacturer’s specification. • Documentation of Customer Notification: PHMSA’s proposal in the NPRM stated operators ‘‘must provide written notification to the customer of their right to request the installation of an EFV,’’ and that ‘‘each operator must maintain a copy of the customer EFV notice for three years.’’ Several commenters noted that the term ‘‘written’’ seemed to exclude forms of electronic notification, and they also noted that documenting individual notifications would be a costly, overly burdensome task. The GPAC recommended that PHMSA incorporate language from the NPRM preamble indicating broader options for stakeholder communication, including statements printed on customer bills or mailings or certain forms of electronic communication, including Web site postings, would satisfy the customer notification requirement, and that operators could keep a single copy of a particular method of communication for purposes of fulfilling the documentation requirement. This final rule adopts all three recommendations of the GPAC. Additional discussion of the amendments and associated comments of the GPAC are provided below as a part of the comment discussion. in response to the NPRM as well as the individual docket number for each comment. All comments and corresponding rulemaking materials received may be viewed on the www.regulations.gov Web site under docket ID PHMSA–2011–0009. The majority of the comments specifically supported expanding EFV installation requirements. Major concerns included whether first responders should have access to curb valves, whether curb valves required inspection and maintenance, and what methods were being proposed for customer notification and documentation. Minor concerns included EFV installation, the effective date of the rule, and exceptions to EFV installation and notification. The substantive comments received on the proposed regulations are organized by topic and are discussed in the appropriate sections below, along with PHMSA’s responses. IV. Comment Summary and Discussion In the NPRM published July 15, 2015, PHMSA solicited public comment on whether the proposed amendments would enhance the safety of natural gas distribution systems, as well as the cost and benefit figures associated with these proposals. PHMSA received 12 comments from a broad array of stakeholders, including trade organizations, pipeline operators, a government agency, and a public citizen safety watchdog group. Below is a list of organizations that submitted comments Public Citizen Groups (1) VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 Pipeline Operators (5) • New Mexico Gas Company (NMG) PHMSA–2011–0009–0032 • Southwest Gas Corporation (SWG) PHMSA–2011–0009–0044 • NiSource (NS) PHMSA–2011– 0009–0042 • Sierra Pacific Power Company (SPPC) PHMSA–2011–0009–0041 • MidAmerican Energy Company (MAE) PHMSA–2011–0009–0034 Trade Associations (5) • American Gas Association (AGA) PHMSA–2011–0009–0037 • National Propane Gas Association (NPGA) PHMSA–2011–0009–0045 • Gas Piping Technology Committee (GPTC) PHMSA–2011–0009–0036 • American Public Gas Association (APGA) PHMSA–2011–0009–0024 • Northeast Gas Association (NGA) PHMSA–2011–0009–0039 Government/Municipalities (1) • National Transportation Safety Board (NTSB) PHMSA–2011–0009– 0035 • Pipeline Safety Trust (PST) PHMSA–2011–0009–0040 A. Expansion of EFVs to Multifamily Residences, Branch Service Lines, and Small Commercial Buildings Proposal: EFVs can reduce the risks of explosions by shutting off unplanned, excessive gas flows, primarily from excavation damage to service lines between gas mains and buildings. Gas distribution pipeline operators are currently required to install EFVs in PO 00000 Frm 00068 Fmt 4700 Sfmt 4700 new and replacement service lines supplying SFRs, per the final rule titled ‘‘Integrity Management Programs for Gas Distribution Pipelines,’’ issued on December 4, 2009. In the NPRM, PHMSA proposed adding four new categories of service for which EFV installation will be required on new and entirely replaced gas distribution services. These four new categories are as follows: • Branched service lines to an SFR installed concurrently with the primary SFR service line (a single EFV may be installed to protect both lines); • Branched service lines to an SFR installed off a previously installed SFR service line that does not contain an EFV; • Multifamily installations, including duplexes, triplexes, fourplexes, and other small multifamily buildings (e.g., apartments, condominiums) with known customer loads at time of service installation, based on installed meter capacity, up to 1,000 SCFH per service; and • A single, small commercial customer, served by a single service line, with known customer load at time of service installation, based on installed meter capacity, up to 1,000 SCFH per service. Comments: The majority of the commenters from trade associations, industry, citizen groups, and government entities explicitly supported the expanded use of EFVs in all categories and recognized the benefits of their use. The NTSB was ‘‘pleased that PHMSA is now proposing to expand the requirements for installing EFVs’’ and understood ‘‘that the expanded coverage is based on a comprehensive examination of the practical operating limits of EFVs and comments on the ANPRM.’’ The NTSB stated that it ‘‘supports the measures proposed in the NPRM and believes that they will improve the safety of natural gas distribution pipeline systems.’’ The PST noted the publication ‘‘fulfill[s] the NTSB’s recommendation from 2001 to its full scope,’’ and they ‘‘join[ed] with the NTSB in supporting this proposed expansion.’’ Industry trade associations, such as the AGA, which represents more than 200 local energy companies throughout the United States and provides gas to 94 percent of U.S. customers, stated in their comments that they and ‘‘their member utilities completely support expanding EFV installation to multifamily residential service lines and small commercial services.’’ The APGA, the national, non-profit association of publicly owned natural gas distribution E:\FR\FM\14OCR1.SGM 14OCR1 ehiers on DSK5VPTVN1PROD with RULES Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations systems with over 700 members serving 37 States, also supported the expansion of EFVs, stating that ‘‘EFVs are the one tool that distribution operators can use to reduce the risk posed when natural gas service lines are ruptured by excavation.’’ The APGA also noted that ‘‘in written comments submitted in response to PHMSA’s ANPRM published November 25, 2011, APGA and other commenters suggested EFV installation requirements virtually identical to what PHMSA has proposed,’’ and ‘‘commend[ed] PHMSA for adopting APGA’s recommendation.’’ NMGC ‘‘commend[ed] and support[ed] expanding the use of excess flow valves to new and fully replaced branch services, small multifamily facilities, and small commercial facilities where economically, technically, and operationally feasible.’’ SWG ‘‘support[ed] the practical and reasonable expansion of EFVs to new and fully replaced service lines beyond single family residential applications,’’ in part ‘‘evident by its EFV installation policy and number of EFVs installed [on its existing system].’’ Likewise, the NGA ‘‘support[ed] PHMSA’s proposal to expand the use of excess flow valves in gas distribution services for newly constructed applications other than single-family residences and when existing services are excavated or replaced,’’ recognizing that ‘‘installing EFVs, under conditions where they are effective, when new services are installed, or existing services are exposed, repaired or replaced, is a costeffective measure to improve pipeline safety.’’ The NGA also noted that it ‘‘supported this proposal in its initial comments to the advanced notice of proposed rulemaking related to this issue in 2012.’’ PHMSA Response: PHMSA has been attempting to address issues involving the broad installation of EFVs since at least 1990, and the NTSB has issued several recommendations to PHMSA and the regulated industry regarding the installation of EFVs on particular services as far back as the 1970s. NTSB Recommendation P–01–2, which asks PHMSA to ‘‘require that excess flow valves be installed in all new and renewed gas service lines, regardless of a customer’s classification, when the operating conditions are compatible with readily available valves,’’ is one of PHMSA’s oldest, unclosed NTSB recommendations. Prior attempts to require the installation of EFVs on certain gas distribution services were not supported by both industry and State pipeline safety partners; for years, EFVs were perceived as unreliable, costly pieces of VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 equipment that might accidentally close and interfere with normal service, interfere with maintenance activities, or be difficult to size and use at varying line pressures. Further, in the Pipeline Inspection, Protection, Enforcement, and Safety Act of 2006, Congress provided PHMSA with a mandate to focus its resources on requiring EFV installation on service lines serving single-family residences as part of PHMSA’s gas distribution integrity management program (DIMP) rulemaking. Following the issuance of the DIMP rulemaking and the EFV regulations in 2009, EFVs became more technologically feasible and costeffective to a point where it became a realistic possibility for PHMSA to address fully the NTSB recommendation. PHMSA performed several studies and surveys to evaluate the feasibility of its position on highvolume EFVs and used its experience in the prior EFV rulemaking to assist in formulating this proposal. PHMSA is pleased that there is now such widespread support, both from industry and public groups, for expanding the installation of EFVs beyond SFRs. Accordingly, this final rule amends the Federal Pipeline Safety Regulations by adding the proposed four new categories of service to require EFV installation on branched service lines (both branched lines to SFRs installed concurrently with the primary SFR service line and branched lines to SFRs installed off a previously installed SFR service lines not containing an EFV), lines serving multifamily installations, and lines serving small commercial and industrial customers. B. Curb Valve Accessibility to First Responders Proposal: In the NPRM, PHMSA proposed requiring operators to install curb valves for applications that operate above 1,000 SCFH, are not suitable for EFV installation, and do not meet the exemptions in the existing § 192.383. Curb valves are the most feasible alternative to EFVs in locations that exceed 1,000 SCFH or have other issues that prevent EFV use. Although they cannot be operated instantaneously like EFVs, curb valves can still mitigate the effects of gas line explosions and are an effective safety measure. Therefore, PHMSA proposed that any curb valves installed under this section be accessible to first responders. PHMSA’s experience indicates that, frequently, first responders arrive at the scene of an incident before operator personnel do. If first responders have access to a curb valve during an emergency and can PO 00000 Frm 00069 Fmt 4700 Sfmt 4700 70991 operate it, the valve can be closed to mitigate further consequences. Comments: The NTSB was pleased to note that PHMSA’s proposal to require that operators ‘‘install a manual service line shut-off valve on new or replaced service lines in such a manner that emergency personnel can access the valve [. . .] goes beyond the original intent of [the NTSB’s] recommendation, to further ensure safety.’’ The PST joined the NTSB in supporting this measure. Several of the commenters representing trade associations and operators supported the use of curb valves where EFVs are not feasible but strongly opposed requiring that curb valves always be accessible to first responders. These commenters generally indicated that it should be the operator’s responsibility to operate these select portions of gas distribution systems and that it should be up to the operator’s discretion to allow other personnel to operate these valves, if needed. Certain operators noted the ‘‘Pipeline Emergencies’’ training manual, a document developed by a team of respected emergency response and industry experts in partnership with the National Association of Fire Marshals and PHMSA, states that emergency responders should consult the local gas company to determine local procedures for fire department use of curb valves. The AGA indicated there are a few unique situations where operators have properly trained first responders to operate curb valves, but such a practice is not followed by most utilities. Certain industry operators, including the SPPC, commented that they specifically train first responders in their service territories, for safety reasons, not to manually shut off gas flows. If manual service line shut-off valves are accessible to first responders, first responders may operate the wrong valve, may not have the proper equipment to operate the valve, or may incorrectly operate the valve. Operators and trade associations also asserted that, given the complexity of gas distribution systems, emergency shut-off valves should only be operated by operator-qualified personnel who are familiar with the specific gas distribution system in question. NS suggested that, as operators have engineering records indicating the location of all valves and which ones they control, operator personnel can verify the location and purpose of a valve, thereby eliminating the possibility of operating the wrong one and creating a greater hazard. The AGA noted there are many accounts of first responders who, E:\FR\FM\14OCR1.SGM 14OCR1 ehiers on DSK5VPTVN1PROD with RULES 70992 Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations without the approval of the gas company, have inadvertently closed the wrong valve or opened a valve that should have been closed. Several operators argued that allowing first responders to operate manual service line shut-off valves would create additional inconveniences or safety risks, including loss of service to other customers or additional property damage, injuries, or even deaths. Some operators indicated that giving first responders immediate access to curb valves would distract them from their primary mission, which is to perform safety assessments, make locations safe for people, and conduct evacuations from areas of danger. Instead, they would suddenly have responsibility for locating valves, determining which valves should be closed, and closing them—tasks which could potentially interfere with their primary mission and for which they might not be trained. At the GPAC meeting, members of the committee expressed concerns similar to those raised by industry regarding unauthorized or improper manual service line shut-off valve usage. The committee debated whether there could be a requirement authorizing first responders to operate those particular valves or whether operators could give discretion to certain first responders to operate valves. One question that was brought up was whether eliminating ‘‘first responders’’ from the proposed language (which would leave ‘‘accessible to operator personnel’’ remaining) would unintentionally create a requirement that would make manual service line shut-off valves accessible to only company personnel. The committee eventually suggested revising the paragraph by striking the reference to first responders and inserting ‘‘other personnel authorized by the operator.’’ The committee believed this would give operators the primacy they sought for operating their own distribution systems while, at the same time, making the valves accessible and usable by nonoperator personnel with the operator’s consent. PHMSA Response: PHMSA disagrees with those commenters who argued that curb valves should not be accessible to first responders. Many comments PHMSA received seemed to equate valve accessibility with authority or expectation to operate those valves without consent. PHMSA is in no way implying that first responders should have complete autonomy in deciding whether to operate valves on a given gas distribution system. In PHMSA’s experience, there have been accidents where the consequences VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 have grown due to operator delays in shutting off curb valves. As a part of an operator’s regular liaison with first responders, operators can, if they wish, train first responders to use curb valves properly through regular exercises and communications. Further, if the valve cover plate is clearly marked, there should not be any confusion regarding the operation of the valve in an emergency. However, PHMSA is not advocating the unauthorized operation of these valves. Unless they believe there is imminent threat to human life or extensive property damage, first responders should not operate curb valves without operator input or consent. In this final rule, PHMSA is adopting the language recommended by the GPAC, which would make curb valves accessible to operators and other personnel authorized by the operator to manually shut off gas flow, if needed, in the event of an emergency. PHMSA appreciates the work of the GPAC in proposing a consensus solution that enables first responders, if qualified and authorized, to operate valves if needed, yet retains the operators’ right to make decisions regarding the operation of their own systems. C. Curb Valve Maintenance Proposal: In its NPRM, PHMSA proposed requiring operators to install curb valves for applications that operate above 1,000 SCFH, are not suitable for EFV installation, and do not meet the exemptions in the existing § 192.383. Curb valves are the most feasible alternative to EFVs in locations that exceed 1,000 SCFH or have other issues that prevent EFV use. Although they cannot be operated instantaneously like EFVs, curb valves can still mitigate the effects of gas line explosions and are an important safety measure. Under the proposed amendment to § 192.385(c), manual service line shut-off valves for any new or replaced service line must be installed in such a way as to allow accessibility during emergencies. Comments: Just as it supported the proposal to ensure the accessibility of curb valves to first responders, the NTSB also supported this proposal. Comments from industry and trade associations, however, were unified in their concern that this requirement would create confusion regarding maintenance requirements based on earlier PHMSA interpretations. Specifically, operators noted that the addition of § 192.385, as proposed in the NPRM, might lead to the mistaken inference that manual service line shutoff valves would be subject to the valve maintenance requirements set forth in PO 00000 Frm 00070 Fmt 4700 Sfmt 4700 § 192.747, ‘‘Valve maintenance: Distribution systems.’’ The AGA, NMGC, SWG, and APGA all noted that PHMSA has issued many letters of interpretation affirming that § 192.747 does not apply to curb valves, but the proposed § 192.385 could be misconstrued to require such annual inspections. The AGA and NMGC support PHMSA’s historical position that manual curb valves are not considered a ‘‘critical valve’’ for inspection purposes, suggesting that if these valves were to be designated as critical valves, operators would have to hire and train a significantly larger staff to inspect and maintain these valves, which would significantly increase operating costs and impose an administrative burden. The AGA and APGA noted that if it was PHMSA’s intent to change its position and require annual inspections on these manual curb valves, this is not indicated in the NPRM, the estimated cost of the rule, or the estimated paperwork burden. Operators suggested PHMSA clearly state in the final rule that curb valves installed under this proposal would not be subject to the requirements at § 192.747. At the GPAC meeting, members of the committee discussed this proposal and whether these valves should be inspected and maintained according to the requirements at § 192.747. Several members agreed that inspecting and maintaining these valves would be an important safety measure, although several suggested that requiring these valves to be inspected and maintained would require an increase in staffing and operator qualification. Other members of the committee expressed concerns about operating these valves for inspection purposes, arguing that testing curb valves could knock out service in areas if they were operated improperly, and that testing could potentially present more risk than reward. Members of the committee also agreed that requiring annual inspection and maintenance of these valves would be unreasonable and perhaps unnecessary. Some suggested that if these valves were to be inspected and maintained, then perhaps those requirements could be tied to existing maintenance activities, such as leak surveys and patrolling, meter-change programs, or other times when service lines would be shut off. Ultimately, the committee suggested requiring valves installed under this section to be subject to regularly scheduled and documented maintenance consistent with the valve manufacturer’s specifications. While some GPAC members expressed concern E:\FR\FM\14OCR1.SGM 14OCR1 Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations ehiers on DSK5VPTVN1PROD with RULES that valve manufacturers might specify overly stringent inspection and maintenance intervals for particular curb valves, other GPAC members noted that manufacturer specifications are an important part of the industry’s operation and maintenance considerations. PHMSA Response: PHMSA believes that curb valves installed under this section must be accessible (e.g., clear of debris) and occasionally operated to ensure they are working properly. A curb valve does not provide any safety benefit if it is inoperable. Therefore, to ensure the safe operation of a particular gas distribution system, it is imperative that these valves function as intended. PHMSA concluded that the burden of inspecting and maintaining these valves would be minimal, as operator personnel can meet these requirements by simply ensuring the valves are free of debris that could prevent operation and by ensuring the valves are able to turn and operate. Further, these requirements can be quickly performed and will not be an undue burden on operators, as operators can choose to coordinate them with other activities, such as leak surveys, patrolling, meterchange programs, as well as other actions where service would be shut off and properly qualified personnel are present.6 PHMSA also agrees with the GPAC discussion regarding manufacturer specifications. Not only are manufacturer specifications important to consider in the context of operating a safe gas transportation system, but market forces typically ensure reasonable operation and maintenance standards. PHMSA appreciates the work of the GPAC in debating this proposal and chooses to adopt the language the GPAC recommended, as the amendment strikes a good balance between limiting any potential burden imposed on operators and performing necessary activities to ensure operability and safety. Therefore, the final rule amends the Federal Pipeline Safety Regulations to require that manual service shut-off valves installed under this section be subject to regular scheduled maintenance as documented by the operator and consistent with the valve manufacturer’s specifications. 6 Nonetheless, if there is minimal increase in time spent on the order of 5 minutes per visit for curb valve maintenance, PHMSA estimates costs would be approximately $113,416 annually for an estimated 40,955 curb valves per year based on a fully loaded hourly wage rate for natural gas distribution meter readers ($33.23 per hour per Bureau of Labor Statistics information (http:// www.bls.gov/oes/current/oes435041.htm) and a total of 3,413 hours. VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 D. Customer Notification Proposal: PHMSA proposed in the NPRM that operators must notify customers of their right to request the installation of EFVs. Specifically, each operator must provide written notification to the customer of their right to request the installation of an EFV within 90 days of the customer first receiving gas at a particular location. Operators of master-meter systems may continually post a general notification in a prominent location frequented by customers. Comments: PHMSA received several comments on the proposed notification requirement regarding the frequency of notification, method of notification, notification content, and the persons who should receive notification. The NTSB was ‘‘pleased that PHMSA is proposing to require the operator to inform customers of their right to request an EFV be installed on an existing service line,’’ and the PST joined the NTSB in that support. Operators and trade associations nearly universally supported notifying all existing customers of their right to request an EFV through broad communication methods rather than the proposed individual, dedicated notification method, which those commenters argued would have created a significant administrative burden. Some commenters questioned the effectiveness of the requirement for notification to customers within 90 days of new service. The APGA felt it was unclear what was meant by ‘‘notification must occur within 90 days of the customer first receiving gas at a particular location.’’ This could be interpreted to apply when the operator changed the name of the person to whom it sends gas bills. This could also be interpreted not to require notification of existing customers who have been receiving gas for more than 90 days. MAE noted it appears the intent studied in the Evaluation was for a single annual notification to all customers and customer classes, based on a 1-hour level of burden. Several operators, including MAE and SPPC, as well as trade organizations, argued that establishing a 90-day requirement per customer would cause a significant increase in costs, documentation efforts, and a tangible administrative burden. MAE concurs with the idea of notifying owners of the option for an EFV and its potential benefits but believes this could be done with a new customer packet that could be acted upon by customers who want to initiate installation. This could then be inspected as a part of the public awareness program. PO 00000 Frm 00071 Fmt 4700 Sfmt 4700 70993 Many operators and trade associations suggested that notifying all existing customers through a broad notification, such as ‘‘bill stuffers,’’ ‘‘new customer’’ packets, and Web site postings, would be a better use of operator resources and provide greater benefits. SWG noted that allowing operators to provide EFV notification through broad means would be consistent with the way PHMSA proposed the notification requirement for master-meter operators. Further, the AGA mentioned that the NPRM’s ‘‘Section-by-Section’’ analysis indicated PHMSA was open to other forms of notification, such as a printed statement on a customer bill or mailings, but that was not evident in the actual proposed regulatory text. Members of the GPAC echoed this statement when the committee meeting was held and wanted PHMSA to clarify which methods of notification were acceptable. The AGA suggested that given the number of customers that have migrated to online billing and have opted to receive notifications electronically from their natural gas service provider, operators should be able to satisfy the notification requirement through electronic notifications to customers, postings on the company’s Web site, and other forms of electronic communications. Satisfying the proposed requirement through these methods as well as traditional communications would allow effective communication at a lower cost and in a more efficient manner. The AGA urged PHMSA to make it clear in the final rule that individual communications to each customer would not be required, and that an annual general EFV communication would suffice. The APGA noted that, as many operators may elect to use bill stuffers to notify all customers about EFVs, PHMSA should allow, as an alternative to notification within 90 days of a customer receiving gas, operators to notify all customers annually of their right to request an EFV. For many APGA members, this would be the least administratively burdensome method of notifying customers and have the added benefit of providing customers who may have overlooked the original notice with additional opportunities to choose to have an EFV installed on their service lines. Several commenters had miscellaneous concerns on what the customer notification should contain. SPPC suggested providing a description of EFVs and their safety benefits as well as advice on how to request one, a notification that could be inspected as part of an operator’s public awareness E:\FR\FM\14OCR1.SGM 14OCR1 ehiers on DSK5VPTVN1PROD with RULES 70994 Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations program. The AGA recommended that PHMSA require operators include general information in their public communications on the cost associated with retrofitting an existing service line to accommodate an EFV. NS suggested PHMSA adapt and incorporate language similar to that issued in the 1998 EFV customer notification rule, including language discussing the potential safety benefits, a description of installation and replacement costs, and an explanation of when a requested EFV would be installed. PHMSA Response: PHMSA appreciates the comments received on this topic and the industry’s support for a broad annual notification requirement that would provide customers with important safety information. When outlining the proposal in the NPRM, PHMSA did not intend to suggest that customer EFV notifications needed to be non-electronic or otherwise individually carried out. PHMSA has no objection to the method by which operators notify their customers as long as the operator can be sure of reaching all customers who have a right to request an EFV. Therefore, a combination of methods, including Internet Web site postings, bill stuffers, new customer packets, statements on billing materials, et cetera, can be used to notify all customers. PHMSA has determined that, as many of the commenter-proposed methods would theoretically notify, on a regular basis, all customers about their potential right to request an EFV, a broad, electronic method of communication would meet the intent of the regulation and be acceptable. PHMSA has also determined that, as operators appear to be willing to notify all existing customers about their potential right to request an EFV, the specific 90-day customer notification window for new services is unnecessary. PHMSA has removed this language from the final regulatory text. A broad notification to all customers will also address any concerns about reaching customers who are not eligible for EFV installation or who have already had EFVs installed. As for the specific content of a notification, PHMSA has determined it would be beneficial to include language that was previously required in the 1998 EFV notification rule, especially considering that operators would already be familiar with the previous requirements. In line with comments from SPPC, AGA, and NS, PHMSA will require that operators include general information on the cost associated with EFV installation, the potential safety benefits that may be derived from installing an EFV, and conditions for VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 installation. The operator may choose how to word the specific information as long as they provide sufficient information to give customers a rational basis for deciding whether they want to request an EFV installation. The notification should also be written in plain language. E. Customer Documentation Proposal: PHMSA proposed in the NPRM that each operator must maintain a copy of the customer EFV notice for 3 years. This notice must be available during PHMSA inspections or State inspections conducted under a pipeline safety program certified or approved by PHMSA under 49 U.S.C. 60105 or 60106. Comments: The majority of the comments submitted by industry and trade associations were an extension of the concerns regarding customer notification and focused on the idea that documenting individual notifications would be a major undertaking and a poor use of resources. While many operators and trade associations seemed to agree that using and documenting broad methods of communications (e.g., statements printed on customer bills, mailings, or electronic Web pages) would be reasonable, there were some differing opinions on how notifications should be documented. The AGA recommended that the final rule allow retention of a single copy of any notice, accompanied by a listing of the customers who received the mailing, or by documenting the electronic communication itself. The APGA noted that in the proposed rule’s preamble, PHMSA stated that evidence of notification could include such items as a statement printed on customer bills or mailing. The APGA further noted that PHMSA did not propose to require operators to keep records showing that individual customers had been notified. SWG stated that while the section-bysection analysis indicated that operator evidence of notification could include such items as a statement printed on customer bills or mailings, the proposed regulatory text did not include such language. Some operators and trade associations discussed other issues pertaining to the 3-year recordkeeping requirement. SPPC and NGA noted that customer properties with frequent turnover would have multiple records for the same address that would need to be maintained and sorted for a period that could extend beyond the 3 years required by the regulations. The NPGA argued that PHMSA’s recordkeeping requirement presented a greater burden than estimated. For large liquefied petroleum PO 00000 Frm 00072 Fmt 4700 Sfmt 4700 gas (LPG) operators, it would be a considerable clerical task to collect and review all EFV installation notifications to maintain a record spanning 3 years. The NPGA suggested that PHMSA permit the recordkeeping as an option rather than a requirement, which would allow LPG operators to choose best practices for their businesses and customers. PHMSA Response: PHMSA determined that several of the concerns raised by commenters in this section could be addressed through clarifying the proposed language and through revisions to the customer notification method. It was not PHMSA’s intent to suggest that operators would need to transmit and document individual notifications to eligible customers. As a few of the commenters pointed out, PHMSA had indicated that a statement printed on customer bills or mailings would suffice as evidence for customer notification, but this language and intent was not incorporated into the proposed regulatory text. As PHMSA is allowing operators to notify customers through a broad range of electronic and traditional communications, the agency will also allow operators to retain a copy of the broad annual notification or notifications they are using to communicate with customers their right to request an EFV. In line with the 2008 Federal Pipeline Safety Regulations regarding operator evidence of customer notification, operators will be required to make a copy of the notice currently in use available during PHMSA inspections or inspections conducted under a program certified or approved by PHMSA under 49 U.S.C. 60105 or 60106 without any further recordkeeping requirement or timeframe. F. Installation Flexibility Proposal: PHMSA proposed in the NPRM that operators must install a manual service line shut-off valve for any new or replaced service line with an installed meter capacity exceeding 1,000 SCFH. Comments: Overall, operators and trade associations supported installing curb valves where EFVs are not feasible due to operational concerns. However, many operators and trade associations noted that the language, as proposed, did not allow operators flexibility for installing EFVs where possible on lines operating at greater than 1,000 SCFH and also might require operators to install both an EFV and a manual service line shut-off valve on the same line. E:\FR\FM\14OCR1.SGM 14OCR1 ehiers on DSK5VPTVN1PROD with RULES Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations Several operators and trade associations, including SPPC, NMGC, AGA, NS, MAE, APGA, and SWG, suggested PHMSA revise the proposed regulatory text to give operators the option to install either an EFV or a manual service line shut-off valve based on sound engineering analysis and the availability of larger-format EFVs. The NMGC verified with EFV manufacturers, such as GasBreaker Inc., that EFVs are available and will meet the requirements necessary for operating on single-family residences above 1,000 SCFH. NS saw an opportunity to encourage operators to install EFVs on loads in excess of 1,000 SCFH, as NS has had success with installing EFVs in service lines for loads greater than 1,000 SCFH. The APGA believed the technology of EFVs and products available would continue to evolve, and in the future, some operators may test and become comfortable installing EFVs on some services operating above 1,000 SCFH. The APGA noted the rule should state that an operator need not install a curb valve if the operator installs an EFV on a service line instead. Further, SPPC noted that this requirement should be flexible enough to ensure that operators can account for increased loads in the future, such as being able to install a curb valve on a new service line with an initial load less than 1,000 SCFH but that might later exceed 1,000 SCFH so as to avoid the additional cost of replacing an EFV with a curb valve in the future. Additionally, NMGC, SWG, NGA, and AGA determined that under no circumstances should operators be required to install both an EFV and a manual service line shut-off valve on the same service line. The AGA noted that, as currently proposed, the regulations would require both a manual curb valve and an EFV on (1) any SFR operating at greater than 1,000 SCFH or (2) a non-SFR operating at greater than 1,000 SCFH where an operator installed an EFV under DIMP. Further, as proposed, the rule could prohibit further innovation on EFVs that might be able to operate above 1,000 SCFH. The GPTC expressed a similar view on the issue, noting that the rule, as proposed, would not give an operator sufficient flexibility to use sound engineering practices to design an EFV on service lines with loads greater than 1,000 SCFH, in lieu of a manual curb valve. In the proposed § 192.383(b)(4) and (5), PHMSA established a threshold of 1,000 SCFH customer load over which an EFV was not required. However, there is no threshold limit of 1,000 SCFH for proposed VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 § 192.383(b)(1), (2), and (3). The result is that a large SFR or branch to two large SFRs with a service line load greater than 1,000 SCFH would have both an EFV and a curb valve, but a multifamily residence with a service line load greater than 1,000 SCFH would require only an emergency curb valve, even if an EFV were available and suited for the application. The GPTC asked PHMSA to modify this section to allow greater flexibility. PHMSA Response: PHMSA did not intend to require that operators install both a curb valve and an EFV on the same service line and would like to give operators the flexibility to choose the proper safety valve. PHMSA has no objection to operators installing EFVs on lines with capacities over 1,000 SCFH, as long as that decision is reached through sound engineering analysis. To clarify, if an operator cannot or chooses not to install an EFV on an applicable service line with capacity over 1,000 SCFH, it must install a curb valve. PHMSA notes that it originally wanted to require operators install EFVs on service lines with loads up to 5,000 SCFH, as PHMSA knows that valves are available for these applications, and manufacturers have indicated they have sold EFVs for these load sizes. PHMSA chose the 1,000 SCFH threshold, which was accepted by the GPAC, as a compromise based on comments from industry. Having operators perform a sound engineering analysis will allow PHMSA to verify operators are taking into account maximum loads and the capabilities of EFVs, if available, to handle those loads. An operator’s engineering analysis for sizing an EFV should be based on maximum expected load throughout the year, including snap loads, critical supply applications, system configuration, and future anticipated loads (e.g., when commercial facilities in a shopping center change, gas loads would also change). In many instances, operators size EFVs based on meter capacity at the service. Operators must use caution in expanding EFV use to other larger commercial and multifamily dwelling applications due to the complexity of service line design and usage patterns. In response to SPPC’s comment, PHMSA is not allowing manual valve installation for loads below 1,000 SCFH, even when future anticipated loads may exceed that threshold. In this final rule, PHMSA is allowing operators to install EFVs in lieu of manual valves in instances where loads exceed 1,000 SCFH. As operators already consider anticipated design loads and work with distribution system designers to determine proper system configurations PO 00000 Frm 00073 Fmt 4700 Sfmt 4700 70995 and valve sizing when installing systems, operators should be able to install appropriate valves for future anticipated loads. PHMSA also considered the GPTC’s comment. In the best professional judgment of PHMSA’s subject matter experts, a SFR service line combined with a branch service to another SFR isn’t known to exceed 1,000 SCFH, and typical houses consume anywhere from 100–250 SCF per day. However, commercial and industrial facilities can exceed 1,000 SCFH, and therefore the threshold is needed. Accordingly, in this final rule, PHMSA has amended the Federal Pipeline Safety Regulations at § 192.385(b) to require that operators install either a manual shut-off valve or, if possible, based on sound engineering analysis and availability, an EFV on lines operating at capacities exceeding 1,000 SCFH. G. Cost Recovery and Other Cost-Benefit Issues Proposal: In its NPRM, PHMSA proposed that existing service line customers who desire an EFV on service lines not exceeding 1,000 SCFH and not meeting one of the exceptions contained in paragraph (c) of § 192.383 may request an EFV on their service lines. If a service line customer requests EFV installation, an operator must install the EFV at a mutually agreeable date. The appropriate State regulatory agency would determine who would bear the cost of installation and how the cost would be distributed. Comments: Operators and trade associations were strongly opposed to the final sentence in PHMSA’s proposal that designated the appropriate State regulatory agency as the entity that would determine who would bear the cost of the requested EFV. Most of the comments questioned whether PHMSA had the legal authority to make such a statement and whether a State regulatory agency would be the appropriate authority for all cases. Specifically, the AGA, APGA, and GPTC noted that PHMSA lacked the jurisdiction to codify and regulate the manner by which utilities handle charges to customers. The NPGA noted that PHMSA’s proposal to permit State regulatory authorities to determine what party is responsible for installation costs when a customer requests installation of an EFV presents particular concerns for LPG systems and businesses. PHMSA’s deference to State agencies would impose disproportionately negative effects on operators of LPG systems compared to other utilities, since LPG pipeline operators are not regulated in E:\FR\FM\14OCR1.SGM 14OCR1 ehiers on DSK5VPTVN1PROD with RULES 70996 Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations the same manner as natural gas utilities. The NPGA asked that PHMSA modify the proposal to assign the cost of EFV installation performed at a customer’s request to the customer itself, as LPG businesses are not positioned to pass along additional costs to customers in the same manner as locally regulated utilities. NS noted that in previous amendments to § 192.383 (EFV customer notification, Feb 3, 1998), the Research and Special Programs Administration, PHMSA’s predecessor agency, acknowledged that the cost of installing an EFV on an existing line was to be the responsibility of the customer. Therefore, if PHMSA wishes to address who is to pay for the installation of EFVs on existing service lines, NS proposed that PHMSA adopt its previous requirement that the service line customer bear the cost. NS also believed this requirement would also be best addressed under § 192.383(e). The APGA was vehemently opposed to the proposed language stating that the appropriate State regulatory agency would determine to whom and how the costs of the requested EFVs would be distributed, indicating that of the approximately 1,000 public gas utilities subject to the Federal Pipeline Safety Regulations, only a few have a State agency determining how the cost of gas service is distributed among customers. Whereas State public utility commissions (PUC) typically review and approve the rates charged by investor-owned and privately owned operators (which represent less than 25 percent of distribution operators regulated by PHMSA), rates for public distribution systems are typically approved by the municipality, utility board, or similar local oversight body. The APGA noted the preamble of the NPRM made clear that PHMSA did not intend to regulate how EFV costs would be recovered and did not believe it was PHMSA’s intent to require public gas distribution operators to become subject to PUC review for EFV cost recovery. Rather, the APGA believed it was PHMSA’s intent to ‘‘leave the determination of how the cost of installing an EFV at customer request to the operator and whatever body approves the operator’s gas rates.’’ Apart from PHMSA’s proposal for determining cost recovery, some commenters discussed additional costbenefit issues related to EFV installation on existing service lines. The APGA noted that operators should only be required to install EFVs if requesting customers also agree to whatever costrecovery mechanism has been included in the operator’s approved rates. The VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 AGA, SWG, and NGA noted that the cost of retrofitting an EFV on an existing service line could be significant, with SWG adding that this cost was not included in PHMSA’s cost-benefit analysis. The NGA further indicated that offering customers the option of installing EFVs on existing services not planned for replacement, excavation, or repair was not a cost-effective safety measure, and installing EFVs on existing services should be evaluated by each operator as a part of its integrity management planning. MAE requested a further analysis of the value and costs of installation, operations and maintenance, and leak rates on curb valves to determine whether there are more cost-efficient methods of emergency shut-off. A member of the GPAC also expressed concerns about PHMSA’s cost-benefit numbers related to curb valves, suggesting that PHMSA reconsider including curb valve maintenance in the cost-benefit analysis and further analyze whether the incidents PHMSA used when examining the effectiveness and usefulness of curb valves were applicable to the analysis. Specifically, the GPAC member questioned whether, for the incidents PHMSA selected applicable to curb valves in its analysis, a curb valve on the line would have actually prevented fatalities, injuries, or property damage, noting that the narrative of a few of the accidents indicated some of the fatalities and injuries were actually caused by car crashes and not the subsequent gas incidents. PHMSA Response: It was not PHMSA’s intent in the proposal to specifically delegate cost-recovery duties to State regulatory agencies, especially where certain operators do not have their rates set by these entities. In the Section-by-Section analysis of the NPRM, PHMSA noted it ‘‘has no jurisdiction concerning natural gas rates or any costs incurred due to installation of an optional EFV at a consumer’s request.’’ PHMSA was only trying to indicate that it would defer to the existing rate-setting and cost-recovery structure under which operators currently operate. Therefore, PHMSA has removed the reference to ‘‘State regulatory authority’’ in the regulatory text applicable to cost recovery and has inserted ‘‘The operator’s rate-setter’’ to reflect this intent. PHMSA understands that the cost of installing an EFV on an existing line at the customer’s request is more expensive than if the line were new or being replaced due to excavation and additional labor costs and determined it PO 00000 Frm 00074 Fmt 4700 Sfmt 4700 was not cost-effective to require the fitting of an EFV on all existing services. A 2007 National Regulatory Research Institute (NRRI) study titled ‘‘Survey on Excess Flow Valves: Installations, Cost, Operating Performance, and Gas Operator Policy,’’ suggests that customer-initiated EFV installations are quite rare, even in locations where they are currently allowed by local policy, and would not be a circumstance operators would be dealing with in significant numbers. However, without this provision, customers on existing lines without an EFV would essentially have no option to install an EFV, even if they highly valued the risk reduction that it provided and were willing to pay the full installation cost. These foregone transactions would represent deadweight loss. Although PHMSA determined that mandatory installation on all existing lines would not be costeffective due to excavation and labor costs, some individual households might have a high willingness-to-pay for EFVs due to differences in risk aversion, rate of time preference, and other factors. Further, it is PHMSA’s understanding that customers would typically be required to pay for these installations. From an economic standpoint, an EFV requested and paid for by a customer would actually increase the overall net benefit of the final rule, as PHMSA can infer from the customer’s choice that they value the EFV’s protection at a level greater than the cost they pay.7 Therefore, PHMSA has chosen to retain the right for existing customers to request an EFV installation if they are eligible. As for the concern of whether applicable incidents were chosen to analyze the costs and benefits for curb valves, PHMSA applied reasonable filters to its data to choose appropriate and applicable incidents for analysis but there can be some level of uncertainty in such incident data. PHMSA is also aware of incidents that might have been prevented by the use of a curb valve, but these incidents were excluded from the analysis due to data limitations or for other reasons. In light of this particular comment, however, PHMSA reexamined and revised the incident set pertaining to curb valves in order to provide a more conservative cost-benefit analysis. For some of the incidents in question (e.g., where drivers crashed cars into meter sets), it is unlikely a curb valve would 7 For retrofits, the benefits per valve would be essentially the same as calculated in the accompanying Regulatory Impact Analysis (a range of $4 to $44 at a 7 percent rate, depending on the customer type). E:\FR\FM\14OCR1.SGM 14OCR1 Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations have been effective in preventing the incident following impact, and these incidents were removed from the data set. The final Regulatory Impact Analysis is available in the docket. PHMSA notes that because a curb valve can allow gas flow to be shut off quickly, a curb valve could still be effective in mitigating the consequences of these incidents by shortening their duration, especially where property damage is concerned. Further, PHMSA’s data is limited and often does not indicate clearly whether fatalities, if not caused by the initial impact, are due to injuries sustained during the crash or by the subsequent pipeline incident. For example, quickly shutting off the flow of gas at the site of an incident may be able to save the life of someone who has been knocked unconscious or has been otherwise incapacitated. Because of this, PHMSA still believes that installing EFVs and curb valves on service lines can provide a tangible safety benefit to the public and the environment. H. Miscellaneous Comments Effective Date Proposal: The NPRM proposed that each operator must install an EFV on any new or replaced service line for the services listed in the proposed § 192.383(b) before those lines were activated and prior to January 3, 2014. Comments: Several operators and trade associations, including AGA, NS, and APGA, noted that the effective date for the proposed rule would impose the installation requirement retroactively. These commenters requested that operators be given at least 6 months to prepare for complying with the rule, including time to establish cost allocation with the appropriate ratesetter and to source the valves. PHMSA Response: This portion of the rule was drafted with the 2012 statutory mandate in mind and did not necessarily indicate a retroactive requirement. PHMSA has revised the effective date in the final rule to allow operators 6 months to comply. ehiers on DSK5VPTVN1PROD with RULES Exceptions to the Right To Request an EFV Proposal: The NPRM proposed that operators need not install an EFV if one or more of the following conditions were present: (1) The service line does not operate at a pressure of 10 psig or greater throughout the year; (2) the operator has prior experience with contaminants in the gas stream that could interfere with the EFV’s operation or cause loss of service to a customer; (3) an EFV could interfere with necessary operation or maintenance VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 activities, such as blowing liquids from the line; or (4) an EFV meeting performance standards in § 192.381 is not commercially available to the operator. Comments: The AGA and APGA noted that because of these exemptions, operators should not be required to provide an individual notification to customers of their right to request an EFV if it is not feasible to install an EFV on that customer’s service line. The APGA also noted that if most operators chose to satisfy the notification requirement through customer bills or other mass communication, every customer would still receive notification, regardless of whether EFV installation were impossible or impractical. The APGA also believed that PHMSA should reconsider applying the proposed requirements for the right to request an EFV and customer notification to master-meter operators. As master-meter operators typically serve ‘‘garden-style’’ apartments, mobile home parks, universities, public housing, et cetera, the ‘‘customer’’ is typically a renter and not an owner, which could potentially cause confusion as to who has the right to request an EFV. The AGA and SPPC asked that PHMSA consider exempting service lines that already had manual valves on them or lines where an operator might expect the load to increase beyond 1,000 SCFH and would install a manual valve instead. PHMSA Response: PHMSA noted that the AGA and APGA comments were submitted under the assumption that PHMSA was requiring individual communications to all customers. As the APGA noted, because PHMSA is allowing broad and electronic communication methods regarding EFV installation, all customers, regardless of their eligibility for EFV installation, will be receiving a form of notice. Further, PHMSA has determined that mastermeter operators will largely be held to the same standards as other operators as far as EFV installation is concerned. PHMSA does not wish to include any further exceptions to the ones that were proposed. PHMSA is concerned that operators might interpret the fact that a service line already has a manual valve to mean that an EFV does not need to be installed. This would be an incorrect assumption. Applicable new and replaced service lines with loads not exceeding 1,000 SCFH must have EFVs installed on them. Moreover, as PHMSA is allowing installation flexibility for lines operating above 1,000 SCFH, the agency believes it is unnecessary to provide a specific exemption for PO 00000 Frm 00075 Fmt 4700 Sfmt 4700 70997 installing an EFV when the line could be expected to operate above 1,000 SCFH. Definitions Comments: Several commenters requested definitions or clarification for a few terms in the NPRM. Specifically, SPPC asked PHMSA to add a definition of ‘‘branch service line’’ to § 192.383(a). The APGA noted that SFR is not defined in part 192 and that PHMSA should add it to the definitions or spell out the term when used. The APGA also noted that PHMSA does not define who the ‘‘customer’’ is whom the operator must notify and who has the right to request an EFV. The APGA noted that, in the preamble, PHMSA states that messages on bills would satisfy the notification requirement, which appears to intend that the customer is the person to whom the utility sends the gas bill. The APGA urged PHMSA to clarify this definition if this is the case, as the term ‘‘customer’’ might also be interpreted to mean the consumer of the gas, a resident at a rented property, or perhaps the owner of a property. These could all be different people. The GPTC recommended adding a reference to proposed § 192.385(b) and (c) to refer back to § 192.383 and PHMSA’s definition of replaced service line. MAE recommended PHMSA revise § 192.381(a) to clarify whether EFVs are required for systems that normally operate at 10 psig but that have minimum design pressures of 5–6 psig for anticipated heavy-load conditions. PHMSA Response: PHMSA has added a definition of ‘‘branch service line’’ to the definitions paragraph of § 192.383 and spelled out ‘‘SFR’’ the first time it is used. While PHMSA does not delineate who the ‘‘customer’’ is in the regulatory text, the APGA is correct in that PHMSA intends the ‘‘customer’’ to be the person to whom the utility sends the gas bill. PHMSA declined to add a reference in proposed § 192.385(b) and (c) back to § 192.383 regarding PHMSA’s definition of a replaced service line. PHMSA intends curb valves installed under § 192.385 to be appropriate substitutes for EFVs and are not otherwise considered manual valves within the distribution network. Regarding MAE’s comment, the language indicating that EFVs are to be used on service lines operating continuously throughout the year at a pressure not less than 10 p.s.i. (69 kPa) gage has been in the regulations since 1996. The only change that has been made since that time is the removal of the term ‘‘single-family’’ from ‘‘service lines.’’ PHMSA is aware, however, there E:\FR\FM\14OCR1.SGM 14OCR1 70998 Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations are service lines that experience pressure drops below 10 psig during heavy loading conditions. These lines are not required to have EFVs installed on them. Editorial Comments Comments: NS suggested that proposed language concerning a mutually agreeable installation date should be moved to proposed § 192.383(e), which deals with notification requirements. The APGA was not clear on what ‘‘EFV measures’’ the reporting requirement refers to. The APGA suggested this is not a new reporting requirement but rather refers to the existing EFV reporting requirements in § 191.11 and should either be deleted or clarified to make clear that it only applies to operators that are required to file annual reports. PHMSA Response: PHMSA considered these changes and made edits to the regulatory text where appropriate. EFV Standard Development Comments: The GPTC noted that while it appreciated PHMSA’s reference to the GPTC and its work, it still sought to clarify that the GPTC’s Guide Material Appendix 192–8, which provides operators with guidance for developing a distribution integrity management program and compliance with certain sections of part 192, does not include information on the selection, sizing, or installation of EFVs. They noted that helpful guidance to assist operators in addressing EFV performance, selection, and installation considerations is found in MSS SP–115, ASTM F1802, and ASTM F2138. The GPTC also suggested that if PHMSA wants specific standards to be developed, then PHMSA should approach those organizations to develop such standards. The NGA commented that it did not believe that development of EFV standards was needed and that the development of design considerations would best be performed by the utilities themselves or by standards-setting organizations, based on EFV manufacturer specifications considering customer load, meter size, service pipe size, and pressures. PHMSA Response: PHMSA solicited comments in the gas pipeline ANPRM on whether standards should be developed for EFVs. In the NPRM, PHMSA noted that it would not be incorporating by reference any new standards for EFVs into the Pipeline Safety Regulations but might do so in the future if the need arose. V. Regulatory Notices and Analysis A. Statutory/Legal Authority for This Rulemaking This final rule is published under the authority of the Federal pipeline safety laws (49 U.S.C. 60101 et seq.). Section 60102 of title 49, U.S.C., authorizes the Secretary of Transportation to issue regulations governing the design, installation, inspection, emergency plans and procedures, testing, construction, extension, operation, replacement, and maintenance of pipeline service lines. Further, Section 60109(e)(3)(B) states that ‘‘the Secretary, if appropriate, shall by regulation require the use of excess flow valves, or equivalent technology, where economically, technically, and operationally feasible on new or entirely replaced distribution branch services, multifamily facilities, and small commercial service facilities.’’ B. Executive Order 12866, Executive Order 13563, and DOT Regulatory Policies and Procedures This final rule is a non-significant regulatory action under section 3(f) of Executive Order 12866 (58 FR 51735) and, therefore, was not reviewed by the Office of Management and Budget. This final rule is not significant under the Regulatory Policies and Procedures of the Department of Transportation (44 FR 11034) because of substantial stakeholder interest in pipeline safety. Executive Orders 12866 and 13563 require agencies regulate in the most cost-effective manner, make a reasoned determination that the benefits of the intended regulations justify its costs, and develop regulations that impose the least burden on society. PHMSA is providing the final Regulatory Impact Analysis (RIA) simultaneously with this rule, and it is available in the docket. The final RIA does not address the benefits and costs of the proposal to require operators to install EFVs on branched service lines providing gas service to SFRs because the benefits and costs of this proposal were addressed in the regulatory impact analysis for a previous rulemaking.8 The final RIA found that the estimated monetized benefits do not exceed the monetized costs in all cases. For the requirement of installing EFVs on new or replaced service lines providing gas service to multifamily residences, the monetized costs exceeded monetized benefits, even when using lower-bound cost estimates. PHMSA believes that the amendments are nevertheless justified by significant unquantifiable benefits, such as avoided evacuations and environmental damage from EFV-preventable incidents, including incidents that could not be included in the analysis because they do not meet PHMSA’s reporting criteria. EFVs also provide protection against a low-probability but high-consequence incident that could inflict mass casualties. PHMSA estimates a total impacted community of 4,448 operators for this rule (3,119 master meter/small LPG operators who will need to comply with notification requirements and 1,329 natural gas distribution operators who will need to install valves and comply with notification requirements) and 222,114 service lines per year on average. PHMSA assumed that valves do not have network effects; in other words, each EFV operates independently, and the costs and benefits of EFV installation simply scale linearly. The total annualized benefits of the rule are $5.5 million when discounted at 7 percent, while the total annualized costs are $10.6 million. At the 3 percent discount rate, the total benefits of the rule are $10.6 million, while the costs are $12.0 million. The following table summarizes the annualized benefits and costs of this final rule: TABLE ES–1—SUMMARY OF ESTIMATED BENEFITS AND COSTS ($ MILLIONS) 1 ehiers on DSK5VPTVN1PROD with RULES Customer category Annualized benefit Branched Line Single Family ......................................................................................... Multifamily Residence .................................................................................................... Small Commercial .......................................................................................................... Industrial/Other curb valve ............................................................................................. See note ............................. 1.0 ....................................... 1.6 ....................................... 3.0 ....................................... 8 ‘‘Pipeline Safety: Integrity Management Programs for Gas Distribution Pipelines.’’ December 4, 2009, (74 FR 63906) (RIN 2137–AE15. VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 PO 00000 Frm 00076 Fmt 4700 Sfmt 4700 E:\FR\FM\14OCR1.SGM 14OCR1 Annualized cost See note. 6.2 1.1 3.0 Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations 70999 TABLE ES–1—SUMMARY OF ESTIMATED BENEFITS AND COSTS ($ MILLIONS) 1—Continued Customer category Annualized benefit Annualized cost All classifications: Notification & recordkeeping ............................................................ Not estimated ..................... 0.3 Total ........................................................................................................................ 5.5 ....................................... 10.6 ehiers on DSK5VPTVN1PROD with RULES Note: Benefits and costs for branched SFR services accounted for in economic analysis of previous rulemaking (Distribution Integrity Management Program). 1 50-year present value converted to annual equivalent using 7% discount rate. Additional unquantified benefit areas include: • Equity: Provides a fair and equal level of safety to members of society who do not live in SFRs; • Additional incident costs avoided for which no PHMSA incident data are available: • Mitigates the consequences (death, injury, property damage) of incidents when customer piping or equipment is involved and thus the incident would not be reflected in PHMSA records; • Additional incident costs that are not recorded in incident reports, including costs of evacuations, emergency response costs, and business downtime; • Environmental externalities associated with methane releases (discussed in the RIA Appendix); • Peace of mind for operators and customers; and • Protection against seismic events and intentional tampering. Executive Order 13563 is supplemental to and reaffirms the principles, structures, and definitions governing regulatory review that were established in Executive Order 12866, Regulatory Planning and Review, of September 30, 1993. Additionally, Executive Order 13563 specifically requires agencies to: (1) Involve the public in the regulatory process; (2) promote simplification and harmonization through interagency coordination; (3) identify and consider regulatory approaches that reduce burden and maintain flexibility; (4) ensure the objectivity of any scientific or technological information used to support regulatory action; and (5) consider how to best promote retrospective analysis to modify, streamline, expand, or repeal existing rules that are outmoded, ineffective, insufficient, or excessively burdensome. When developing this rule, PHMSA involved the public in the regulatory process in a variety of ways. Specifically, PHMSA considered public comments based on the proposals in the NPRM, addressed those comments in the docket, and discussed the proposals with the members of the GPAC and any public representatives in attendance. VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 This final rule is expected to produce a safety benefit that addresses a congressional mandate and a NTSB safety recommendation and which can be implemented at relatively minor cost; similar regulations have been effective when applied to single-family residences. Further, industry has already shown a willingness to expand EFV applications, recognizing that EFVs have the potential to avert high-cost, low-probability events that, while absent in the dataset for multifamily residences, can still occur. C. Executive Order 13132: Federalism This final rule has been analyzed in accordance with the principles and criteria contained in Executive Order 13132 (‘‘Federalism’’). PHMSA issues pipeline safety regulations applicable to interstate and intrastate pipelines. The requirements in this rule apply to operators of distribution pipeline systems, which are primarily intrastate pipeline systems. Under 49 U.S.C. 60105, a State may regulate an intrastate pipeline facility or intrastate pipeline transportation after submitting a certification to PHMSA. Thus, State pipeline safety regulatory agencies with valid certifications on file with PHMSA will be the primary enforcers of the safety requirements proposed in this NPRM. Under 49 U.S.C. 60107, PHMSA provides grant money to participating States to carry out their pipeline safety enforcement programs. Although a few States choose not to participate in the natural gas pipeline safety grant program, every State has the option to participate. This grant money is used to defray additional costs incurred by enforcing the pipeline safety regulations. PHMSA has concluded this final rule does not include any regulation that: (1) Has substantial direct effects on States, relationships between the national government and the States, or distribution of power and responsibilities among various levels of government; (2) imposes substantial direct compliance costs on States and local governments; or (3) preempts State law. Therefore, the consultation and funding requirements of Executive PO 00000 Frm 00077 Fmt 4700 Sfmt 4700 Order 13132 (August 10, 1999; 64 FR 43255) do not apply. D. Regulatory Flexibility Act The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires an agency to review regulations to assess their impact on small entities, unless the agency determines that a rule will not have a significant impact on a substantial number of small entities. This final rule has been developed in accordance with Executive Order 13272 (‘‘Proper Consideration of Small Entities in Agency Rulemaking’’) and DOT’s procedures and policies to promote compliance with the Regulatory Flexibility Act to ensure that potential impacts of rules on small entities are properly considered. This final rule requires gas pipeline operators to comply with the new EFV installation requirements. The Small Business Administration (SBA) criteria for defining a small business in the natural gas pipeline distribution industry is one that employs less than 1000 employees as specified in the North American Industry Classification System (NAICS) codes. The RFA defines ‘‘small governmental jurisdiction’’ as the government of a city, county, town, township, village, school district, or special district with a population less than 50,000. To identify gas distribution operators affected by the proposed requirements that are small businesses or small governmental jurisdictions, PHMSA used information provided by Dun and Bradstreet. Dun and Bradstreet provides PHMSA with estimates of small business classifications based on SBA size standards for operators that file an annual report, along with a flag for public sector entities that is based on information such as entity name and NAICS code. These data indicate that approximately 60 percent of affected operators are public entities; among these, the share that are small governmental jurisdictions is not known. Among the private sector entities, approximately one-third are small entities according to the SBA size definition for their NAICS code. The most common of these is NAICS E:\FR\FM\14OCR1.SGM 14OCR1 71000 Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations 221210, natural gas distribution, for which the standard is 1,000 employees. Overall, while the number of small entities is not known with precision, it appears to be substantial when considering gas distribution operators that are small businesses or small governmental jurisdictions, as well as the master meter and small LPG operators that are presumed to be small entities. However, PHMSA determined that this rule does not have a significant economic impact on a substantial number of small entities. While the natural gas distribution industry includes many small entities, including both small businesses and small governmental jurisdictions, the impacts of the rule are clearly de minimus, both in relation to operator revenues and to the utility rate-payers to whom the incremental costs would ultimately be allocated. PHMSA’s Regulatory Flexibility Analysis, which reached this determination, is available in the docket for this rulemaking. Accordingly, the head of the agency certifies under Section 605(b) of the RFA that this final rule will not have a significant economic impact on a substantial number of small entities because the additional costs are minimal. E. Unfunded Mandates Reform Act of 1995 This final rule does not impose unfunded mandates under the Unfunded Mandates Reform Act of 1995. It would not result in costs of $147.6 million, adjusted for inflation, or more in any one year to State, local, or tribal governments, in the aggregate, or to the private sector, and is the least burdensome alternative that achieves the objective of the final rule. Installation of EFVs and curb valves significantly protects the safety of the public and is technically and economically feasible. ehiers on DSK5VPTVN1PROD with RULES F. National Environmental Policy Act PHMSA analyzed this final rule in accordance with section 102(2)(c) of the National Environmental Policy Act (42 U.S.C. 4332), the Council on Environmental Quality regulations (40 CFR parts 1500–1508), and DOT Order 5610.1C, and has determined that this action will not significantly affect the quality of the human environment. An environmental assessment of this final rule, which explains this determination, is available in the docket. VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 G. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments This final rule has been analyzed in accordance with the principles and criteria contained in Executive Order 13175 (‘‘Consultation and Coordination with Indian Tribal Governments’’). Because this rule does not have tribal implications and does not impose substantial direct compliance costs on Indian tribal governments, the funding and consultation requirements of Executive Order 13175 do not apply. H. Executive Order 13211: Energy Supply, Distribution, or Use This final rule is not a ‘‘significant energy action’’ under Executive Order 13211 (Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use). It is not likely to have a significant adverse effect on supply, distribution, or energy use. Further, the Office of Information and Regulatory Affairs has not designated this final rule as a significant energy action. I. Paperwork Reduction Act Pursuant to 5 CFR 1320.8(d), PHMSA is required to provide interested members of the public and affected agencies with an opportunity to comment on information collection and recordkeeping requests. As a result of the requirements of this rulemaking, the following information collection impacts are expected: Gas Distribution Annual Report Revision PHMSA is revising § 192.383 to require the installation of EFVs on applications beyond SFRs that are currently required. Further, PHMSA is adding § 192.385, which would require the installation of manual service line shut-off valves. As a result, PHMSA wants to track the number of new installations related to these provisions on an annual basis. This will change the Gas Distribution Annual Report, which is contained in the currently approved information collection, titled ‘‘Annual Reports for Gas Distribution Operators,’’ identified under OMB Control Number 2137–0629. PHMSA is revising the Gas Distribution Annual Report to collect the number of EFVs installed on multifamily dwellings and small commercial businesses and the number of manual service line shut-off valves installed. Currently, operators are required to submit the total number of EFVs installed on SFRs and the total number of EFVs within their systems. Therefore, PHMSA does not expect operators to experience an increase in PO 00000 Frm 00078 Fmt 4700 Sfmt 4700 burden beyond that already incurred for the Gas Distribution Annual Report. PHMSA has submitted an information collection revision request to OIRA to cover the components of this data collection. The request is under review and pending approval. PHMSA will publish a subsequent notice in the Federal Register upon the approval of this collection. Customer Notification Section 192.383 of this final rule will require operators to notify customers of their right to request the installation of EFVs. Operators have multiple options for fulfilling this requirement, including adding a short statement to customer bills, incorporating a public awareness message on the company Web site, incorporating the notification on bill stuffers or in new customer packets, and posting a notice in a prominent location (for master-meter/small LPG operators). PHMSA estimates that approximately half of the 6,237 operators categorized as either master-meter operators or small LPG systems will be impacted, resulting in 3,119 affected operators. This estimate is based on the premise that only half of these operators have systems that can accommodate an EFV. PHMSA also estimates that 1,329 gas distribution operators will be impacted. Therefore, PHMSA estimates a total impacted community of 4,448 (3,119 master-meter/small LPG operators and 1,329 gas distribution operators). PHMSA estimates that each impacted operator will take approximately 1 hour per year to create and complete this notification. PHMSA expects a vast majority of notifications to be made electronically, and, as such, expects the recordkeeping of these documents to be automatic and self-executing upon saving such documents. Consequently, PHMSA expects there to be no additional burden to the operator for saving the notifications for recordkeeping purposes. PHMSA estimates the total annual cost of this provision at $280,713 per year (4,448 operators * 1 hour/operator * $63.11/ hour 9). PHMSA has submitted a new information collection request to OIRA to cover the components of this data collection. The request is under review and pending approval. PHMSA will publish a subsequent notice in the Federal Register upon the approval of this collection. As a result of the changes listed above, PHMSA is submitting an 9 Bureau of Labor Statistics, Occupational Employment Statistics, May 2015. Occupation code 13–041, industry code 221200. http://www.bls.gov/ oes/current/oes131041.htm. E:\FR\FM\14OCR1.SGM 14OCR1 ehiers on DSK5VPTVN1PROD with RULES Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations information collection revision request as well as a new information collection request to OMB for approval based on the requirements in this final rule. These information collections are contained in the pipeline safety regulations, 49 CFR parts 190–199. The following information is provided for these information collections: (1) Title of the information collection; (2) OMB control number; (3) Current expiration date; (4) Type of request; (5) Abstract of the information collection activity including a description of the changes applicable to the rulemaking action; (6) Description of affected public; (7) Estimate of total annual reporting and recordkeeping burden; and (8) Frequency of collection. The information collection burden for the following information collection is requested as follows: 1. Title: Annual Reports for Gas Distribution Operators. OMB Control Number: 2137–0629. Current Expiration Date: May 31, 2018. Type of Request: Revision. Abstract: This information covers the collection of annual report data for gas distribution pipeline operators. This information collection will only be revised to reflect the amendment to the Gas Distribution Annual Report, which will allow operators to submit the number of EFVs that are installed in multifamily dwellings and small commercial businesses and the number of manual service line shut-off valves installed. PHMSA does not expect this revision to result in a burden-hour increase. Affected Public: Gas Pipeline Operators. Annual Reporting and Recordkeeping Burden: Total Annual Responses: 1,446. Total Annual Burden Hours: 23,136. Frequency of Collection: On occasion. 2. Title: Customer Notifications for Installation of Excess Flow Valves. OMB Control Number: TBD. Current Expiration Date: Not Applicable. Type of Request: New Information Collection. Abstract: This new information collection will cover the reporting and recordkeeping requirements for gas pipeline operators associated with the requirement of operators to notify customers of their right to request the installation of excess flow valves. Affected Public: Gas Pipeline Operators. Annual Reporting and Recordkeeping Burden: Total Annual Responses: 4,448 responses. VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 Total Annual Burden Hours: 4,448 hours. Frequency of Collection: On occasion. Requests for a copy of this information collection should be directed to Angela Dow, Office of Pipeline Safety (PHP–30), Pipeline and Hazardous Materials Safety Administration (PHMSA), 2nd Floor, 1200 New Jersey Avenue SE., Washington, DC 20590–0001, Telephone 202–366–4595. J. Privacy Act Statement In accordance with 5 U.S.C. 553(c), DOT solicits comments from the public to better inform its rulemaking process. DOT posts these comments, without edit, including any personal information the commenter provides, to www.regulations.gov, as described in the system of records notice (DOT/ALL– 14 FDMS), which can be reviewed at www.dot.gov/privacy. K. Regulation Identifier Number A regulation identifier number (RIN) is assigned to each regulatory action listed in the Unified Agenda of Federal Regulations. The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. The RIN contained in the heading of this document may be used to crossreference this action with the Unified Agenda. List of Subjects in 49 CFR Part 192 Excess flow valve installation, Excess flow valve performance standards, Pipeline safety, Service lines. In consideration of the foregoing, PHMSA is amending 49 CFR part 192 as follows: PART 192—TRANSPORTATION OF NATURAL AND OTHER GAS BY PIPELINE: MINIMUM FEDERAL SAFETY STANDARDS 1. The authority citation for part 192 continues to read as follows: ■ Authority: 49 U.S.C. 5103, 60102, 60104, 60108, 60109, 60110, 60113, 60116, 60118, 60137, and 49 CFR 1.97. 2. In § 192.381, paragraph (a) introductory text is revised to read as follows: ■ § 192.381 Service lines: Excess flow valve performance standards. (a) Excess flow valves (EFVs) to be used on service lines that operate continuously throughout the year at a pressure not less than 10 p.s.i. (69 kPa) gage must be manufactured and tested by the manufacturer according to an industry specification, or the PO 00000 Frm 00079 Fmt 4700 Sfmt 4700 71001 manufacturer’s written specification, to ensure that each valve will: * * * * * ■ 3. Section 192.383 is revised to read as follows: § 192.383 Excess flow valve installation. (a) Definitions. As used in this section: Branched service line means a gas service line that begins at the existing service line or is installed concurrently with the primary service line but serves a separate residence. Replaced service line means a gas service line where the fitting that connects the service line to the main is replaced or the piping connected to this fitting is replaced. Service line serving single-family residence means a gas service line that begins at the fitting that connects the service line to the main and serves only one single-family residence (SFR). (b) Installation required. An EFV installation must comply with the performance standards in § 192.381. After April 17, 2016, each operator must install an EFV on any new or replaced service line serving the following types of services before the line is activated: (1) A single service line to one SFR; (2) A branched service line to a SFR installed concurrently with the primary SFR service line (i.e., a single EFV may be installed to protect both service lines); (3) A branched service line to a SFR installed off a previously installed SFR service line that does not contain an EFV; (4) Multifamily residences with known customer loads not exceeding 1,000 SCFH per service, at time of service installation based on installed meter capacity, and (5) A single, small commercial customer served by a single service line with a known customer load not exceeding 1,000 SCFH, at the time of meter installation, based on installed meter capacity. (c) Exceptions to excess flow valve installation requirement. An operator need not install an excess flow valve if one or more of the following conditions are present: (1) The service line does not operate at a pressure of 10 psig or greater throughout the year; (2) The operator has prior experience with contaminants in the gas stream that could interfere with the EFV’s operation or cause loss of service to a customer; (3) An EFV could interfere with necessary operation or maintenance activities, such as blowing liquids from the line; or E:\FR\FM\14OCR1.SGM 14OCR1 ehiers on DSK5VPTVN1PROD with RULES 71002 Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Rules and Regulations (4) An EFV meeting the performance standards in § 192.381 is not commercially available to the operator. (d) Customer’s right to request an EFV. Existing service line customers who desire an EFV on service lines not exceeding 1,000 SCFH and who do not qualify for one of the exceptions in paragraph (c) of this section may request an EFV to be installed on their service lines. If an eligible service line customer requests an EFV installation, an operator must install the EFV at a mutually agreeable date. The operator’s rate-setter determines how and to whom the costs of the requested EFVs are distributed. (e) Operator notification of customers concerning EFV installation. Operators must notify customers of their right to request an EFV in the following manner: (1) Except as specified in paragraphs (c) and (e)(5) of this section, each operator must provide written or electronic notification to customers of their right to request the installation of an EFV. Electronic notification can include emails, Web site postings, and e-billing notices. (2) The notification must include an explanation for the service line customer of the potential safety benefits that may be derived from installing an EFV. The explanation must include information that an EFV is designed to shut off the flow of natural gas automatically if the service line breaks. (3) The notification must include a description of EFV installation and replacement costs. The notice must alert the customer that the costs for maintaining and replacing an EFV may later be incurred, and what those costs will be to the extent known. (4) The notification must indicate that if a service line customer requests installation of an EFV and the load does not exceed 1,000 SCFH and the conditions of paragraph (c) are not present, the operator must install an EFV at a mutually agreeable date. (5) Operators of master-meter systems and liquefied petroleum gas (LPG) operators with fewer than 100 customers may continuously post a general notification in a prominent location frequented by customers. (f) Operator evidence of customer notification. An operator must make a copy of the notice or notices currently in use available during PHMSA inspections or State inspections conducted under a pipeline safety program certified or approved by PHMSA under 49 U.S.C. 60105 or 60106. (g) Reporting. Except for operators of master-meter systems and LPG operators with fewer than 100 customers, each operator must report the EFV measures VerDate Sep<11>2014 13:00 Oct 13, 2016 Jkt 241001 detailed in the annual report required by § 191.11. ■ 4. Section 192.385 is added to subpart H to read as follows: § 192.385 Manual service line shut-off valve installation. (a) Definitions. As used in this section: Manual service line shut-off valve means a curb valve or other manually operated valve located near the service line that is safely accessible to operator personnel or other personnel authorized by the operator to manually shut off gas flow to the service line, if needed. (b) Installation requirement. The operator must install either a manual service line shut-off valve or, if possible, based on sound engineering analysis and availability, an EFV for any new or replaced service line with installed meter capacity exceeding 1,000 SCFH. (c) Accessibility and maintenance. Manual service line shut-off valves for any new or replaced service line must be installed in such a way as to allow accessibility during emergencies. Manual service shut-off valves installed under this section are subject to regular scheduled maintenance, as documented by the operator and consistent with the valve manufacturer’s specification. Issued in Washington, DC, on October 7, 2016, under authority delegated in 49 CFR Part 1.97. Marie Therese Dominguez, Administrator. [FR Doc. 2016–24817 Filed 10–13–16; 8:45 am] BILLING CODE 4910–60–P DEPARTMENT OF TRANSPORTATION Federal Motor Carrier Safety Administration 49 CFR Part 350 [Docket No. FMCSA–2016–0149] RIN 2126–AB91 Amendments To Implement Grants Provisions of the Fixing America’s Surface Transportation Act Federal Motor Carrier Safety Administration (FMCSA), DOT. ACTION: Final rule. AGENCY: The Federal Motor Carrier Safety Administration (FMCSA) adopts, as final, certain regulations required by the Fixing America’s Surface Transportation Act (FAST Act) enacted on December 4, 2015. The involved statutory changes went into effect on October 1, 2016, and require that FMCSA make conforming changes to its SUMMARY: PO 00000 Frm 00080 Fmt 4700 Sfmt 4700 regulations to ensure they are current and consistent with the statutory requirements. Adoption of these rules is a nondiscretionary, ministerial action that FMCSA may take without issuing a notice of proposed rulemaking and receiving public comment, in accordance with the good cause exception available to Federal agencies under the Administrative Procedure Act. DATES: This final rule is effective October 14, 2016. Petitions for Reconsideration must be received by the Agency no later than November 14, 2016. FOR FURTHER INFORMATION CONTACT: Kathryn Sinniger, Federal Motor Carrier Safety Administration, 1200 New Jersey Avenue SE., Washington, DC 20590; by telephone at (202) 493–0908, or by electronic mail at kathryn.sinniger@ dot.gov. If you have questions regarding the grants program, please contact: Thomas Liberatore, Federal Motor Carrier Safety Administration, 1200 New Jersey Avenue SE., Washington, DC 20590; by telephone at (202) 366– 3030, or by electronic mail at thomas.liberatore@dot.gov. If you have questions regarding the docket, call Docket Services, telephone 202–366– 9826. SUPPLEMENTARY INFORMATION: I. Executive Summary A. Purpose and Summary of the Major Provisions This rule makes nondiscretionary, ministerial changes to FMCSA regulations that are required by the FAST Act (Pub. L. 114–94, 129 Stat. 1312, December 4, 2015). The FAST Act made several notable changes to the grant programs administered by FMCSA. For example, it consolidated the Border Enforcement, New Entrant, and Performance and Registration Information Systems Management (PRISM) grants into the formula Motor Carrier Safety Assistance Program (MCSAP) grant. Each State is now required to fully participate in the PRISM program by October 1, 2020, as a condition to receive funding under MCSAP. The FAST Act also created a standalone High Priority financial assistance (High Priority) Program with two major purposes: activities related to motor carrier safety and Innovative Technology Deployment (ITD). The ITD program modifies and replaces the FMCSA’s Commercial Motor Vehicle Information Systems and Networks (CVISN) program. Also, the Safety Data Improvement Program, which was previously a standalone grant program, E:\FR\FM\14OCR1.SGM 14OCR1

Agencies

[Federal Register Volume 81, Number 199 (Friday, October 14, 2016)]
[Rules and Regulations]
[Pages 70987-71002]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-24817]


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

DEPARTMENT OF TRANSPORTATION

Pipeline and Hazardous Materials Safety Administration

49 CFR Part 192

[Docket No. PHMSA-2011-0009; Amdt. No 192-121]
RIN 2137-AE71


Pipeline Safety: Expanding the Use of Excess Flow Valves in Gas 
Distribution Systems to Applications Other Than Single-Family 
Residences

AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA), 
DOT.

ACTION: Final rule.

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

SUMMARY: Excess flow valves (EFV), which are safety devices installed 
on natural gas distribution pipelines to reduce the risk of accidents, 
are currently required for new or replaced gas service lines servicing 
single-family residences (SFR), as that phrase is defined in 49 CFR 
192.383(a). This final rule makes changes to part 192 to expand this 
requirement to include new or replaced branched service lines servicing 
SFRs, multifamily residences, and small commercial entities consuming 
gas volumes not exceeding 1,000 Standard Cubic Feet per Hour (SCFH). 
PHMSA is also amending part 192 to require the use of either manual 
service line shut-off valves (e.g., curb valves) or EFVs, if 
appropriate, for new or replaced service lines with meter capacities 
exceeding 1,000 SCFH. Lastly, this final rule requires operators to 
notify customers of their right to request installation of an EFV on 
service lines that are not being newly installed or replaced. PHMSA has 
left the question of who bears the cost of installing EFVs on service 
lines not being newly installed or replaced to the operator's rate-
setter.

DATES: This final rule is effective April 14, 2017.

FOR FURTHER INFORMATION CONTACT: 
    Technical questions: Vincent Holohan, General Engineer, by 
telephone at 202-366-1933 or by electronic mail at 
vincent.holohan@dot.gov.
    General information: Robert Jagger, Technical Writer, by telephone 
at 202-366-4361 or by electronic mail at robert.jagger@dot.gov.

SUPPLEMENTARY INFORMATION: 

I. Executive Summary

A. Purpose of the Regulatory Action

    EFVs can reduce the risk of explosions in natural gas distribution 
pipelines by shutting off unplanned, excessive gas flows. These events 
are primarily the result of excavation damage to service lines that 
occurs between the gas main and the customer's building. Based on the 
comments to this rulemaking, PHMSA experience, and various studies, 
PHMSA has determined that the safety benefits of expanding the use of 
EFVs to new or entirely replaced distribution branch services (gas 
service lines that begin at an existing service line or that are 
installed concurrently with primary service lines but serve separate 
residences), multifamily facilities, and small commercial facilities is 
appropriate from a technical, economical, and operational feasibility 
standpoint.

B. Summary of the Major Provisions of the Regulatory Action

    Pursuant to Section 22 of the Pipeline Safety, Regulatory 
Certainty, and Job Creation Act of 2011, this final rule amends the 
Federal pipeline safety regulations by adding four new categories of 
service for which EFV installation will be required. These four new 
categories are for new and entirely replaced services. The existing EFV 
installation requirement for SFRs served by a single service line 
remains unchanged. The new categories of service are as follows:
     Branched service lines to a SFR installed concurrently 
with the primary SFR service line (a single EFV may be installed to 
protect both lines);
     Branched service lines to a SFR installed off a previously 
installed SFR service line that does not contain an EFV;

[[Page 70988]]

     Multifamily installations, including duplexes, triplexes, 
fourplexes, and other small multifamily buildings (e.g., apartments, 
condominiums) with known customer loads at time of service 
installation, based on installed meter capacity, up to 1,000 SCFH per 
service; \1\ and
---------------------------------------------------------------------------

    \1\ The average single-family home uses about 200 standard cubic 
feet of gas per day and individual apartment units use even less.
---------------------------------------------------------------------------

     A single, small commercial customer served by a single 
service line, with a known customer load at time of service 
installation, based on installed meter capacity, of up to 1,000 SCFH 
per service.
    Operators will be required to give all customers notice of the 
option to request an EFV installation, except where such installation 
is not required under Sec.  192.383(c) (i.e., where the service line 
does not operate at a pressure of 10 psig or greater through the year, 
the operator has experienced contaminants in the gas stream that could 
interfere with EFV operation, an EFV could interfere with operation and 
maintenance activities, or an EFV meeting performance standards in 
Sec.  192.381 is not available).
    Finally, this final rule also amends the Federal pipeline safety 
regulations by requiring curb valves, or EFVs, if appropriate, for 
applications operating above 1,000 SCFH.

C. Costs and Benefits

    PHMSA estimates a total impacted community of 4,448 operators for 
this rule (3,119 master meter/small LPG operators who will need to 
comply with notification requirements and 1,329 natural gas 
distribution operators who will need to install valves and comply with 
notification requirements) and 222,114 service lines per year on 
average. It is expected to generate safety benefits in the form of 
reduced fatalities, injuries, lost product, and other property damage 
from certain types of preventable incidents in gas distribution 
pipelines. The overall benefits over a 50-year period were estimated at 
the annual equivalent of $5.5 million per year versus $10.6 million in 
compliance costs when calculated using a 7 percent discount rate. When 
using a 3 percent discount rate, the total benefits of the rule were 
estimated at $10.5 million while the costs were estimated at $12.0 
million.

II. Background

A. Excess Flow Valves and Curb Valves

    An EFV is a mechanical safety device installed inside a natural gas 
distribution service line between the street and residential meter. If 
there is a significant increase in the flow of gas (e.g., due to a 
damaged line), the EFV will ``trip'' or close to minimize the flow of 
gas through the line and thus, the amount of gas escaping into the 
atmosphere. During normal use, the valve is kept pushed open against 
oncoming gas flow by a spring. EFVs are designed so that general usage, 
such as turning on appliances, will not shut the valve. However, during 
a significant increase in the flow of gas (e.g., due to a damaged 
line), the spring cannot overcome the force of gas, and the valve will 
close and stay closed until the correct pressure is restored. When the 
correct pressure is restored, the EFV automatically resets itself.
    Curb valves are installed below grade in a service line at or near 
the property line with a protective curb box or standpipe for quick 
subsurface access and are operated by use of a removable key or 
specialized wrench.

B. The South Riding, VA, Incident

    On July 7, 1998, in South Riding, VA, an explosion stemming from a 
residential service line resulted in one death and three injuries. It 
is not known if the explosion occurred on a branched or non-branched 
service line, but PHMSA believes that this final rule or PHMSA's 
previous rule requiring EFVs on single lines serving SFRs \1\ would, at 
a minimum, have mitigated the consequences of the explosion.
---------------------------------------------------------------------------

    \1\ ``Pipeline Safety: Integrity Management Programs for Gas 
Distribution Pipelines,'' 74 FR 63906 (December 4, 2009), RIN 2137-
AE15.
---------------------------------------------------------------------------

    An investigation by the National Transportation Safety Board (NTSB) 
found the explosion likely would not have occurred if an EFV had been 
installed on the service line leading to this single-family home. As a 
result of its investigation, on June 22, 2001, the NTSB issued Safety 
Recommendation P-01-2, recommending that PHMSA ``require that EFVs be 
installed in all new and renewed gas service lines, regardless of a 
customer's classification (i.e., not just lines serving single-family 
residences), when the operating conditions are compatible with readily 
available valves.''

C. PHMSA's EFV Studies and Evaluation Report

    In December 2005, a multi-stakeholder group convened by PHMSA 
published a report titled: ``Integrity Management for Gas Distribution: 
Report of Phase I Investigations.'' \2\ The report recommended that 
``[A]s part of its distribution integrity management plan, an operator 
should consider the mitigative value of EFVs. EFVs meeting performance 
criteria in Sec.  192.381 and installed in accordance with Sec.  
192.383 may reduce the need for other mitigation options.''
---------------------------------------------------------------------------

    \2\ http://www.regulations.gov/contentStreamer?documentId=PHMSA-RSPA-2004-19854-0070&attachmentNumber=1&disposition=attachment&contentType=pdf
---------------------------------------------------------------------------

    In an effort to study the possible benefits of expanding EFVs 
beyond SFR applications, PHMSA began development of an Interim 
Evaluation in early 2009. In June and August of that year, PHMSA held 
public meetings on NTSB Recommendation P-01-2 with participants from 
the following major stakeholder groups: the National Association of 
Regulatory Utility Commissioners, the National Association of Pipeline 
Safety Representatives, the International Association of Fire Chiefs, 
the National Association of State Fire Marshals, natural gas 
distribution operators, trade associations, manufacturers, and the 
Pipeline Safety Trust.
    On December 4, 2009, PHMSA amended the pipeline safety regulations 
to require the use of EFVs for new or replaced gas lines servicing 
SFRs.\3\ While this requirement met the mandate of the Pipeline 
Inspection, Protection, Enforcement, and Safety Act enacted in 2006, 
other distribution lines, including those that served branched SFRs, 
apartment buildings, other multi-residential dwellings, commercial 
properties, and industrial service lines, were still not required to 
use EFVs. These structures are susceptible to the same risks as SFR 
service lines.
---------------------------------------------------------------------------

    \3\ ``Pipeline Safety: Integrity Management Programs for Gas 
Distribution Pipelines,'' December 4, 2009, (74 FR 63906) RIN 2137-
AE15.
---------------------------------------------------------------------------

    PHMSA, already aware of this risk, issued a report in 2010 titled: 
``Interim Evaluation: NTSB Recommendation P-01-2 Excess Flow Valves in 
Applications Other Than Service Lines Serving One SFR'' (Interim 
Evaluation),\4\ which studied the possible expansion of EFVs beyond 
SFRs and the challenges involved with such expansion. The Interim 
Evaluation also addressed other

[[Page 70989]]

practical alternatives, such as the use of manual isolation devices 
(e.g., curb valves) to quickly cut off the uncontrolled flow of gas in 
an emergency. The Interim Evaluation also identified challenges related 
to the feasibility and practicality of the proposed solutions, as well 
as significant cost and benefit factors. The report found that there 
were no other devices or viable options to shut off gas supply quickly 
when gas service lines ruptured.
---------------------------------------------------------------------------

    \4\ The purpose of the Interim Evaluation was to respond to NTSB 
Safety Recommendation P-01-02 and evaluate the possibility of 
expansion of EFVs to applications other than service lines serving 
one single-family residence (above 10 psig). The report also built a 
foundation for an economic analysis, considered the need for 
enhanced technical standards or guidelines, and suggested that any 
new technical standards include criteria for pressure drops across 
the EFV. The Interim Evaluation can be found at the following link: 
http://www.regulations.gov/contentStreamer?documentId=PHMSA-2011-0009-0002&attachmentNumber=1&disposition=attachment&contentType=pdf. 
The Interim Evaluation was finalized in 2015 based on comments to 
the Interim Report.
---------------------------------------------------------------------------

    The Evaluation \5\ was finalized in 2015, based on comments to the 
Interim Evaluation, input from the meetings, and comments to the 
Advance Notice of Proposed Rulemaking (ANPRM) discussed below. Both 
reports can be found in Docket PHMSA-2011-0009.
---------------------------------------------------------------------------

    \5\ http://www.regulations.gov/contentStreamer?documentId=PHMSA-2011-0009-0027&attachmentNumber=1&disposition=attachment&contentType=pdf.
---------------------------------------------------------------------------

D. Advance Notice of Proposed Rulemaking

    PHMSA published an ANPRM for gas pipelines on November 25, 2011 (76 
FR 72666), asking the public to comment on the findings of the Interim 
Evaluation and issues relating to the expanded use of EFVs in gas 
distribution systems. PHMSA also sought comments from gas distribution 
operators on their experiences using EFVs, including:
     Technical challenges of installing EFVs on services other 
than SFRs;
     Categories of service to be considered for expanded EFV 
use;
     Cost factors;
     Data analysis in the Interim Evaluation;
     Technical standards for EFV devices; and
     Potential safety and societal benefits, small-business and 
environmental impacts, and the costs of modifying the existing 
regulatory requirements.
    PHMSA reviewed all of the comments received in response to the 
ANPRM. The comments received from the trade associations largely 
supported expanded EFV use, with certain limitations. Individual 
operators raised concerns about expanded EFV use that were generally 
related to logistics and implementation. Comments from municipalities 
reflected a concern that State laws that were already in place could 
conflict with new Federal requirements. The NTSB expressed strong 
support for increased EFV use. The ANPRM comments collectively helped 
PHMSA finalize the Interim Evaluation and determine what regulatory 
changes to propose in the Notice of Proposed Rulemaking (NPRM).

E. Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011

    In January of 2012, President Obama signed the Pipeline Safety, 
Regulatory Certainty, and Job Creation Act of 2011, which required 
PHMSA to study the possibility of expanding the use of EFVs beyond SFRs 
and issue a final report to Congress on the evaluation of the NTSB's 
recommendation on EFVs within 2 years after enactment of the Act. PHMSA 
was also required to issue regulations, if appropriate, requiring the 
use of EFVs or equivalent technology for new or entirely replaced gas 
distribution branch services, multifamily facilities, and small 
commercial facilities if economically, technically and operationally 
feasible.

F. Notice of Proposed Rulemaking

    PHMSA published an NPRM (80 FR 41460) on July 15, 2015, asking the 
public to comment on the findings of the finalized Evaluation and 
PHMSA's proposals relating to the expanded use of EFVs in gas 
distribution systems. PHMSA proposed a rule that would:
     Expand the EFV requirement to include new or replaced 
branched service lines servicing SFRs, multifamily residences, and 
small commercial entities consuming gas volumes not exceeding 1,000 
SCFH;
     Require the use of manual service line shut-off valves 
(e.g., curb valves) for new or replaced service lines with meter 
capacities exceeding 1,000 SCFH;
     Require operators to notify customers of their right to 
request installation of an EFV on existing service lines; and
     Leave the question of who bears the cost of installing 
EFVs on service lines not being newly installed or replaced to the 
operator, customer, and the appropriate State regulatory agency.

III. Gas Pipeline Advisory Committee

    The Technical Pipeline Safety Standards Committee (otherwise 
commonly referred to as the Gas Pipeline Advisory Committee (GPAC)) is 
a statutorily mandated advisory committee that advises PHMSA on 
proposed safety standards, risk assessments, and safety policies for 
natural gas pipelines. The GPAC was established under the Federal 
Advisory Committee Act (Pub. L. 92-463, 5 U.S.C. App. 1-16) and the 
Federal Pipeline Safety Statutes (49 U.S.C. Chap. 601). The committee 
consists of 15 members, with membership equally divided among Federal 
and State agencies, the regulated industry, and the public. The GPAC 
advises PHMSA on the technical feasibility, practicability, and cost-
effectiveness of each proposed natural gas pipeline safety standard.
    On December 17, 2015, the GPAC met via a teleconference facilitated 
by PHMSA at PHMSA's headquarters in Washington, DC. During the meeting, 
the GPAC considered the specific regulatory proposals set forth in the 
NPRM and discussed the various comments and edits to the NPRM proposed 
by the pipeline industry and the public. The GPAC, in a unanimous 8-0 
vote, found the NPRM, as published in the Federal Register, and the 
Draft Regulatory Evaluation to be technically feasible, reasonable, 
cost-effective, and practicable, if (1) changes were made relative to 
Sec.  192.385 paragraphs (a) and (c), as amended during the meeting; 
and (2) PHMSA incorporated the preamble language regarding 
documentation of customer notification in Sec.  192.383(f).
    The GPAC recommended that PHMSA adopt the following changes:
     Curb Valve Accessibility for First Responders: PHMSA's 
proposal in the NPRM stated that manual service line shut-off valves 
are ``a curb valve or other manually operated valve located near the 
service main or a common source of supply that is accessible to first 
responders and operator personnel [. . .] in the event of an 
emergency.'' The GPAC recommended that the final rule remove language 
requiring proposed manual service line shut-off valves be accessible to 
``first responders and operator personnel.'' Instead, the GPAC 
suggested that the rule require such valves be ``accessible to operator 
personnel or other personnel authorized by the operator.'' Several 
members of the GPAC shared the concerns of industry commenters that 
first responders would attempt to operate these manual service line 
shut-off valves without operator consent or authorization, which might 
lead to further or otherwise unforeseen consequences, including service 
outages. By allowing such valves to be used by ``other personnel 
authorized by the operator,'' operators could have discretion to ensure 
that people familiar with the gas distribution systems in question be 
qualified and authorized to operate manual service line shut-off 
valves, which might include properly trained emergency responders.
     Curb Valve Maintenance: PHMSA's proposal in the NPRM 
defined a manual service line shut-off valve as ``a curb valve or other 
manually operated valve located near the service main or a common 
source of supply that is accessible to first responders and

[[Page 70990]]

operator personnel to manually shut off gas flow to the service line in 
the event of an emergency.'' Several commenters noted that this 
definition could cause confusion and the potential misinterpretation 
that these curb valves would be subject to the maintenance requirements 
at Sec.  192.747, which states that ``each valve, the use of which may 
be necessary for the safe operation of a distribution system, must be 
checked and serviced at intervals not exceeding 15 months but at least 
once each calendar year.'' The GPAC recommended that manual service 
line shut-off valves installed under section Sec.  192.385 be subject 
to regular, but less prescriptive, scheduled maintenance, as documented 
by the operator and consistent with the valve manufacturer's 
specification.
     Documentation of Customer Notification: PHMSA's proposal 
in the NPRM stated operators ``must provide written notification to the 
customer of their right to request the installation of an EFV,'' and 
that ``each operator must maintain a copy of the customer EFV notice 
for three years.'' Several commenters noted that the term ``written'' 
seemed to exclude forms of electronic notification, and they also noted 
that documenting individual notifications would be a costly, overly 
burdensome task. The GPAC recommended that PHMSA incorporate language 
from the NPRM preamble indicating broader options for stakeholder 
communication, including statements printed on customer bills or 
mailings or certain forms of electronic communication, including Web 
site postings, would satisfy the customer notification requirement, and 
that operators could keep a single copy of a particular method of 
communication for purposes of fulfilling the documentation requirement.
    This final rule adopts all three recommendations of the GPAC. 
Additional discussion of the amendments and associated comments of the 
GPAC are provided below as a part of the comment discussion.

IV. Comment Summary and Discussion

    In the NPRM published July 15, 2015, PHMSA solicited public comment 
on whether the proposed amendments would enhance the safety of natural 
gas distribution systems, as well as the cost and benefit figures 
associated with these proposals. PHMSA received 12 comments from a 
broad array of stakeholders, including trade organizations, pipeline 
operators, a government agency, and a public citizen safety watchdog 
group. Below is a list of organizations that submitted comments in 
response to the NPRM as well as the individual docket number for each 
comment. All comments and corresponding rulemaking materials received 
may be viewed on the www.regulations.gov Web site under docket ID 
PHMSA-2011-0009.
    The majority of the comments specifically supported expanding EFV 
installation requirements. Major concerns included whether first 
responders should have access to curb valves, whether curb valves 
required inspection and maintenance, and what methods were being 
proposed for customer notification and documentation. Minor concerns 
included EFV installation, the effective date of the rule, and 
exceptions to EFV installation and notification. The substantive 
comments received on the proposed regulations are organized by topic 
and are discussed in the appropriate sections below, along with PHMSA's 
responses.
Pipeline Operators (5)
     New Mexico Gas Company (NMG) PHMSA-2011-0009-0032
     Southwest Gas Corporation (SWG) PHMSA-2011-0009-0044
     NiSource (NS) PHMSA-2011-0009-0042
     Sierra Pacific Power Company (SPPC) PHMSA-2011-0009-0041
     MidAmerican Energy Company (MAE) PHMSA-2011-0009-0034
Trade Associations (5)
     American Gas Association (AGA) PHMSA-2011-0009-0037
     National Propane Gas Association (NPGA) PHMSA-2011-0009-
0045
     Gas Piping Technology Committee (GPTC) PHMSA-2011-0009-
0036
     American Public Gas Association (APGA) PHMSA-2011-0009-
0024
     Northeast Gas Association (NGA) PHMSA-2011-0009-0039
Government/Municipalities (1)
     National Transportation Safety Board (NTSB) PHMSA-2011-
0009-0035
Public Citizen Groups (1)
     Pipeline Safety Trust (PST) PHMSA-2011-0009-0040

A. Expansion of EFVs to Multifamily Residences, Branch Service Lines, 
and Small Commercial Buildings

    Proposal: EFVs can reduce the risks of explosions by shutting off 
unplanned, excessive gas flows, primarily from excavation damage to 
service lines between gas mains and buildings. Gas distribution 
pipeline operators are currently required to install EFVs in new and 
replacement service lines supplying SFRs, per the final rule titled 
``Integrity Management Programs for Gas Distribution Pipelines,'' 
issued on December 4, 2009. In the NPRM, PHMSA proposed adding four new 
categories of service for which EFV installation will be required on 
new and entirely replaced gas distribution services. These four new 
categories are as follows:
     Branched service lines to an SFR installed concurrently 
with the primary SFR service line (a single EFV may be installed to 
protect both lines);
     Branched service lines to an SFR installed off a 
previously installed SFR service line that does not contain an EFV;
     Multifamily installations, including duplexes, triplexes, 
fourplexes, and other small multifamily buildings (e.g., apartments, 
condominiums) with known customer loads at time of service 
installation, based on installed meter capacity, up to 1,000 SCFH per 
service; and
     A single, small commercial customer, served by a single 
service line, with known customer load at time of service installation, 
based on installed meter capacity, up to 1,000 SCFH per service.

    Comments: The majority of the commenters from trade associations, 
industry, citizen groups, and government entities explicitly supported 
the expanded use of EFVs in all categories and recognized the benefits 
of their use. The NTSB was ``pleased that PHMSA is now proposing to 
expand the requirements for installing EFVs'' and understood ``that the 
expanded coverage is based on a comprehensive examination of the 
practical operating limits of EFVs and comments on the ANPRM.'' The 
NTSB stated that it ``supports the measures proposed in the NPRM and 
believes that they will improve the safety of natural gas distribution 
pipeline systems.'' The PST noted the publication ``fulfill[s] the 
NTSB's recommendation from 2001 to its full scope,'' and they 
``join[ed] with the NTSB in supporting this proposed expansion.''
    Industry trade associations, such as the AGA, which represents more 
than 200 local energy companies throughout the United States and 
provides gas to 94 percent of U.S. customers, stated in their comments 
that they and ``their member utilities completely support expanding EFV 
installation to multifamily residential service lines and small 
commercial services.'' The APGA, the national, non-profit association 
of publicly owned natural gas distribution

[[Page 70991]]

systems with over 700 members serving 37 States, also supported the 
expansion of EFVs, stating that ``EFVs are the one tool that 
distribution operators can use to reduce the risk posed when natural 
gas service lines are ruptured by excavation.'' The APGA also noted 
that ``in written comments submitted in response to PHMSA's ANPRM 
published November 25, 2011, APGA and other commenters suggested EFV 
installation requirements virtually identical to what PHMSA has 
proposed,'' and ``commend[ed] PHMSA for adopting APGA's 
recommendation.''
    NMGC ``commend[ed] and support[ed] expanding the use of excess flow 
valves to new and fully replaced branch services, small multifamily 
facilities, and small commercial facilities where economically, 
technically, and operationally feasible.'' SWG ``support[ed] the 
practical and reasonable expansion of EFVs to new and fully replaced 
service lines beyond single family residential applications,'' in part 
``evident by its EFV installation policy and number of EFVs installed 
[on its existing system].'' Likewise, the NGA ``support[ed] PHMSA's 
proposal to expand the use of excess flow valves in gas distribution 
services for newly constructed applications other than single-family 
residences and when existing services are excavated or replaced,'' 
recognizing that ``installing EFVs, under conditions where they are 
effective, when new services are installed, or existing services are 
exposed, repaired or replaced, is a cost-effective measure to improve 
pipeline safety.'' The NGA also noted that it ``supported this proposal 
in its initial comments to the advanced notice of proposed rulemaking 
related to this issue in 2012.''
    PHMSA Response: PHMSA has been attempting to address issues 
involving the broad installation of EFVs since at least 1990, and the 
NTSB has issued several recommendations to PHMSA and the regulated 
industry regarding the installation of EFVs on particular services as 
far back as the 1970s. NTSB Recommendation P-01-2, which asks PHMSA to 
``require that excess flow valves be installed in all new and renewed 
gas service lines, regardless of a customer's classification, when the 
operating conditions are compatible with readily available valves,'' is 
one of PHMSA's oldest, unclosed NTSB recommendations.
    Prior attempts to require the installation of EFVs on certain gas 
distribution services were not supported by both industry and State 
pipeline safety partners; for years, EFVs were perceived as unreliable, 
costly pieces of equipment that might accidentally close and interfere 
with normal service, interfere with maintenance activities, or be 
difficult to size and use at varying line pressures. Further, in the 
Pipeline Inspection, Protection, Enforcement, and Safety Act of 2006, 
Congress provided PHMSA with a mandate to focus its resources on 
requiring EFV installation on service lines serving single-family 
residences as part of PHMSA's gas distribution integrity management 
program (DIMP) rulemaking. Following the issuance of the DIMP 
rulemaking and the EFV regulations in 2009, EFVs became more 
technologically feasible and cost-effective to a point where it became 
a realistic possibility for PHMSA to address fully the NTSB 
recommendation. PHMSA performed several studies and surveys to evaluate 
the feasibility of its position on high-volume EFVs and used its 
experience in the prior EFV rulemaking to assist in formulating this 
proposal. PHMSA is pleased that there is now such widespread support, 
both from industry and public groups, for expanding the installation of 
EFVs beyond SFRs. Accordingly, this final rule amends the Federal 
Pipeline Safety Regulations by adding the proposed four new categories 
of service to require EFV installation on branched service lines (both 
branched lines to SFRs installed concurrently with the primary SFR 
service line and branched lines to SFRs installed off a previously 
installed SFR service lines not containing an EFV), lines serving 
multifamily installations, and lines serving small commercial and 
industrial customers.

B. Curb Valve Accessibility to First Responders

    Proposal: In the NPRM, PHMSA proposed requiring operators to 
install curb valves for applications that operate above 1,000 SCFH, are 
not suitable for EFV installation, and do not meet the exemptions in 
the existing Sec.  192.383. Curb valves are the most feasible 
alternative to EFVs in locations that exceed 1,000 SCFH or have other 
issues that prevent EFV use. Although they cannot be operated 
instantaneously like EFVs, curb valves can still mitigate the effects 
of gas line explosions and are an effective safety measure. Therefore, 
PHMSA proposed that any curb valves installed under this section be 
accessible to first responders. PHMSA's experience indicates that, 
frequently, first responders arrive at the scene of an incident before 
operator personnel do. If first responders have access to a curb valve 
during an emergency and can operate it, the valve can be closed to 
mitigate further consequences.
    Comments: The NTSB was pleased to note that PHMSA's proposal to 
require that operators ``install a manual service line shut-off valve 
on new or replaced service lines in such a manner that emergency 
personnel can access the valve [. . .] goes beyond the original intent 
of [the NTSB's] recommendation, to further ensure safety.'' The PST 
joined the NTSB in supporting this measure.
    Several of the commenters representing trade associations and 
operators supported the use of curb valves where EFVs are not feasible 
but strongly opposed requiring that curb valves always be accessible to 
first responders. These commenters generally indicated that it should 
be the operator's responsibility to operate these select portions of 
gas distribution systems and that it should be up to the operator's 
discretion to allow other personnel to operate these valves, if needed. 
Certain operators noted the ``Pipeline Emergencies'' training manual, a 
document developed by a team of respected emergency response and 
industry experts in partnership with the National Association of Fire 
Marshals and PHMSA, states that emergency responders should consult the 
local gas company to determine local procedures for fire department use 
of curb valves. The AGA indicated there are a few unique situations 
where operators have properly trained first responders to operate curb 
valves, but such a practice is not followed by most utilities. Certain 
industry operators, including the SPPC, commented that they 
specifically train first responders in their service territories, for 
safety reasons, not to manually shut off gas flows. If manual service 
line shut-off valves are accessible to first responders, first 
responders may operate the wrong valve, may not have the proper 
equipment to operate the valve, or may incorrectly operate the valve.
    Operators and trade associations also asserted that, given the 
complexity of gas distribution systems, emergency shut-off valves 
should only be operated by operator-qualified personnel who are 
familiar with the specific gas distribution system in question. NS 
suggested that, as operators have engineering records indicating the 
location of all valves and which ones they control, operator personnel 
can verify the location and purpose of a valve, thereby eliminating the 
possibility of operating the wrong one and creating a greater hazard.
    The AGA noted there are many accounts of first responders who,

[[Page 70992]]

without the approval of the gas company, have inadvertently closed the 
wrong valve or opened a valve that should have been closed. Several 
operators argued that allowing first responders to operate manual 
service line shut-off valves would create additional inconveniences or 
safety risks, including loss of service to other customers or 
additional property damage, injuries, or even deaths.
    Some operators indicated that giving first responders immediate 
access to curb valves would distract them from their primary mission, 
which is to perform safety assessments, make locations safe for people, 
and conduct evacuations from areas of danger. Instead, they would 
suddenly have responsibility for locating valves, determining which 
valves should be closed, and closing them--tasks which could 
potentially interfere with their primary mission and for which they 
might not be trained.
    At the GPAC meeting, members of the committee expressed concerns 
similar to those raised by industry regarding unauthorized or improper 
manual service line shut-off valve usage. The committee debated whether 
there could be a requirement authorizing first responders to operate 
those particular valves or whether operators could give discretion to 
certain first responders to operate valves. One question that was 
brought up was whether eliminating ``first responders'' from the 
proposed language (which would leave ``accessible to operator 
personnel'' remaining) would unintentionally create a requirement that 
would make manual service line shut-off valves accessible to only 
company personnel. The committee eventually suggested revising the 
paragraph by striking the reference to first responders and inserting 
``other personnel authorized by the operator.'' The committee believed 
this would give operators the primacy they sought for operating their 
own distribution systems while, at the same time, making the valves 
accessible and usable by non-operator personnel with the operator's 
consent.
    PHMSA Response: PHMSA disagrees with those commenters who argued 
that curb valves should not be accessible to first responders. Many 
comments PHMSA received seemed to equate valve accessibility with 
authority or expectation to operate those valves without consent. PHMSA 
is in no way implying that first responders should have complete 
autonomy in deciding whether to operate valves on a given gas 
distribution system.
    In PHMSA's experience, there have been accidents where the 
consequences have grown due to operator delays in shutting off curb 
valves. As a part of an operator's regular liaison with first 
responders, operators can, if they wish, train first responders to use 
curb valves properly through regular exercises and communications. 
Further, if the valve cover plate is clearly marked, there should not 
be any confusion regarding the operation of the valve in an emergency. 
However, PHMSA is not advocating the unauthorized operation of these 
valves. Unless they believe there is imminent threat to human life or 
extensive property damage, first responders should not operate curb 
valves without operator input or consent.
    In this final rule, PHMSA is adopting the language recommended by 
the GPAC, which would make curb valves accessible to operators and 
other personnel authorized by the operator to manually shut off gas 
flow, if needed, in the event of an emergency. PHMSA appreciates the 
work of the GPAC in proposing a consensus solution that enables first 
responders, if qualified and authorized, to operate valves if needed, 
yet retains the operators' right to make decisions regarding the 
operation of their own systems.

C. Curb Valve Maintenance

    Proposal: In its NPRM, PHMSA proposed requiring operators to 
install curb valves for applications that operate above 1,000 SCFH, are 
not suitable for EFV installation, and do not meet the exemptions in 
the existing Sec.  192.383. Curb valves are the most feasible 
alternative to EFVs in locations that exceed 1,000 SCFH or have other 
issues that prevent EFV use. Although they cannot be operated 
instantaneously like EFVs, curb valves can still mitigate the effects 
of gas line explosions and are an important safety measure. Under the 
proposed amendment to Sec.  192.385(c), manual service line shut-off 
valves for any new or replaced service line must be installed in such a 
way as to allow accessibility during emergencies.
    Comments: Just as it supported the proposal to ensure the 
accessibility of curb valves to first responders, the NTSB also 
supported this proposal. Comments from industry and trade associations, 
however, were unified in their concern that this requirement would 
create confusion regarding maintenance requirements based on earlier 
PHMSA interpretations.
    Specifically, operators noted that the addition of Sec.  192.385, 
as proposed in the NPRM, might lead to the mistaken inference that 
manual service line shut-off valves would be subject to the valve 
maintenance requirements set forth in Sec.  192.747, ``Valve 
maintenance: Distribution systems.'' The AGA, NMGC, SWG, and APGA all 
noted that PHMSA has issued many letters of interpretation affirming 
that Sec.  192.747 does not apply to curb valves, but the proposed 
Sec.  192.385 could be misconstrued to require such annual inspections. 
The AGA and NMGC support PHMSA's historical position that manual curb 
valves are not considered a ``critical valve'' for inspection purposes, 
suggesting that if these valves were to be designated as critical 
valves, operators would have to hire and train a significantly larger 
staff to inspect and maintain these valves, which would significantly 
increase operating costs and impose an administrative burden. The AGA 
and APGA noted that if it was PHMSA's intent to change its position and 
require annual inspections on these manual curb valves, this is not 
indicated in the NPRM, the estimated cost of the rule, or the estimated 
paperwork burden. Operators suggested PHMSA clearly state in the final 
rule that curb valves installed under this proposal would not be 
subject to the requirements at Sec.  192.747.
    At the GPAC meeting, members of the committee discussed this 
proposal and whether these valves should be inspected and maintained 
according to the requirements at Sec.  192.747. Several members agreed 
that inspecting and maintaining these valves would be an important 
safety measure, although several suggested that requiring these valves 
to be inspected and maintained would require an increase in staffing 
and operator qualification.
    Other members of the committee expressed concerns about operating 
these valves for inspection purposes, arguing that testing curb valves 
could knock out service in areas if they were operated improperly, and 
that testing could potentially present more risk than reward. Members 
of the committee also agreed that requiring annual inspection and 
maintenance of these valves would be unreasonable and perhaps 
unnecessary. Some suggested that if these valves were to be inspected 
and maintained, then perhaps those requirements could be tied to 
existing maintenance activities, such as leak surveys and patrolling, 
meter-change programs, or other times when service lines would be shut 
off.
    Ultimately, the committee suggested requiring valves installed 
under this section to be subject to regularly scheduled and documented 
maintenance consistent with the valve manufacturer's specifications. 
While some GPAC members expressed concern

[[Page 70993]]

that valve manufacturers might specify overly stringent inspection and 
maintenance intervals for particular curb valves, other GPAC members 
noted that manufacturer specifications are an important part of the 
industry's operation and maintenance considerations.
    PHMSA Response: PHMSA believes that curb valves installed under 
this section must be accessible (e.g., clear of debris) and 
occasionally operated to ensure they are working properly. A curb valve 
does not provide any safety benefit if it is inoperable. Therefore, to 
ensure the safe operation of a particular gas distribution system, it 
is imperative that these valves function as intended. PHMSA concluded 
that the burden of inspecting and maintaining these valves would be 
minimal, as operator personnel can meet these requirements by simply 
ensuring the valves are free of debris that could prevent operation and 
by ensuring the valves are able to turn and operate. Further, these 
requirements can be quickly performed and will not be an undue burden 
on operators, as operators can choose to coordinate them with other 
activities, such as leak surveys, patrolling, meter-change programs, as 
well as other actions where service would be shut off and properly 
qualified personnel are present.\6\ PHMSA also agrees with the GPAC 
discussion regarding manufacturer specifications. Not only are 
manufacturer specifications important to consider in the context of 
operating a safe gas transportation system, but market forces typically 
ensure reasonable operation and maintenance standards.
---------------------------------------------------------------------------

    \6\ Nonetheless, if there is minimal increase in time spent on 
the order of 5 minutes per visit for curb valve maintenance, PHMSA 
estimates costs would be approximately $113,416 annually for an 
estimated 40,955 curb valves per year based on a fully loaded hourly 
wage rate for natural gas distribution meter readers ($33.23 per 
hour per Bureau of Labor Statistics information (http://www.bls.gov/oes/current/oes435041.htm) and a total of 3,413 hours.
---------------------------------------------------------------------------

    PHMSA appreciates the work of the GPAC in debating this proposal 
and chooses to adopt the language the GPAC recommended, as the 
amendment strikes a good balance between limiting any potential burden 
imposed on operators and performing necessary activities to ensure 
operability and safety. Therefore, the final rule amends the Federal 
Pipeline Safety Regulations to require that manual service shut-off 
valves installed under this section be subject to regular scheduled 
maintenance as documented by the operator and consistent with the valve 
manufacturer's specifications.

D. Customer Notification

    Proposal: PHMSA proposed in the NPRM that operators must notify 
customers of their right to request the installation of EFVs. 
Specifically, each operator must provide written notification to the 
customer of their right to request the installation of an EFV within 90 
days of the customer first receiving gas at a particular location. 
Operators of master-meter systems may continually post a general 
notification in a prominent location frequented by customers.
    Comments: PHMSA received several comments on the proposed 
notification requirement regarding the frequency of notification, 
method of notification, notification content, and the persons who 
should receive notification. The NTSB was ``pleased that PHMSA is 
proposing to require the operator to inform customers of their right to 
request an EFV be installed on an existing service line,'' and the PST 
joined the NTSB in that support. Operators and trade associations 
nearly universally supported notifying all existing customers of their 
right to request an EFV through broad communication methods rather than 
the proposed individual, dedicated notification method, which those 
commenters argued would have created a significant administrative 
burden.
    Some commenters questioned the effectiveness of the requirement for 
notification to customers within 90 days of new service. The APGA felt 
it was unclear what was meant by ``notification must occur within 90 
days of the customer first receiving gas at a particular location.'' 
This could be interpreted to apply when the operator changed the name 
of the person to whom it sends gas bills. This could also be 
interpreted not to require notification of existing customers who have 
been receiving gas for more than 90 days. MAE noted it appears the 
intent studied in the Evaluation was for a single annual notification 
to all customers and customer classes, based on a 1-hour level of 
burden. Several operators, including MAE and SPPC, as well as trade 
organizations, argued that establishing a 90-day requirement per 
customer would cause a significant increase in costs, documentation 
efforts, and a tangible administrative burden. MAE concurs with the 
idea of notifying owners of the option for an EFV and its potential 
benefits but believes this could be done with a new customer packet 
that could be acted upon by customers who want to initiate 
installation. This could then be inspected as a part of the public 
awareness program.
    Many operators and trade associations suggested that notifying all 
existing customers through a broad notification, such as ``bill 
stuffers,'' ``new customer'' packets, and Web site postings, would be a 
better use of operator resources and provide greater benefits. SWG 
noted that allowing operators to provide EFV notification through broad 
means would be consistent with the way PHMSA proposed the notification 
requirement for master-meter operators. Further, the AGA mentioned that 
the NPRM's ``Section-by-Section'' analysis indicated PHMSA was open to 
other forms of notification, such as a printed statement on a customer 
bill or mailings, but that was not evident in the actual proposed 
regulatory text. Members of the GPAC echoed this statement when the 
committee meeting was held and wanted PHMSA to clarify which methods of 
notification were acceptable. The AGA suggested that given the number 
of customers that have migrated to online billing and have opted to 
receive notifications electronically from their natural gas service 
provider, operators should be able to satisfy the notification 
requirement through electronic notifications to customers, postings on 
the company's Web site, and other forms of electronic communications. 
Satisfying the proposed requirement through these methods as well as 
traditional communications would allow effective communication at a 
lower cost and in a more efficient manner. The AGA urged PHMSA to make 
it clear in the final rule that individual communications to each 
customer would not be required, and that an annual general EFV 
communication would suffice. The APGA noted that, as many operators may 
elect to use bill stuffers to notify all customers about EFVs, PHMSA 
should allow, as an alternative to notification within 90 days of a 
customer receiving gas, operators to notify all customers annually of 
their right to request an EFV. For many APGA members, this would be the 
least administratively burdensome method of notifying customers and 
have the added benefit of providing customers who may have overlooked 
the original notice with additional opportunities to choose to have an 
EFV installed on their service lines.
    Several commenters had miscellaneous concerns on what the customer 
notification should contain. SPPC suggested providing a description of 
EFVs and their safety benefits as well as advice on how to request one, 
a notification that could be inspected as part of an operator's public 
awareness

[[Page 70994]]

program. The AGA recommended that PHMSA require operators include 
general information in their public communications on the cost 
associated with retrofitting an existing service line to accommodate an 
EFV. NS suggested PHMSA adapt and incorporate language similar to that 
issued in the 1998 EFV customer notification rule, including language 
discussing the potential safety benefits, a description of installation 
and replacement costs, and an explanation of when a requested EFV would 
be installed.
    PHMSA Response: PHMSA appreciates the comments received on this 
topic and the industry's support for a broad annual notification 
requirement that would provide customers with important safety 
information. When outlining the proposal in the NPRM, PHMSA did not 
intend to suggest that customer EFV notifications needed to be non-
electronic or otherwise individually carried out. PHMSA has no 
objection to the method by which operators notify their customers as 
long as the operator can be sure of reaching all customers who have a 
right to request an EFV. Therefore, a combination of methods, including 
Internet Web site postings, bill stuffers, new customer packets, 
statements on billing materials, et cetera, can be used to notify all 
customers. PHMSA has determined that, as many of the commenter-proposed 
methods would theoretically notify, on a regular basis, all customers 
about their potential right to request an EFV, a broad, electronic 
method of communication would meet the intent of the regulation and be 
acceptable.
    PHMSA has also determined that, as operators appear to be willing 
to notify all existing customers about their potential right to request 
an EFV, the specific 90-day customer notification window for new 
services is unnecessary. PHMSA has removed this language from the final 
regulatory text. A broad notification to all customers will also 
address any concerns about reaching customers who are not eligible for 
EFV installation or who have already had EFVs installed.
    As for the specific content of a notification, PHMSA has determined 
it would be beneficial to include language that was previously required 
in the 1998 EFV notification rule, especially considering that 
operators would already be familiar with the previous requirements. In 
line with comments from SPPC, AGA, and NS, PHMSA will require that 
operators include general information on the cost associated with EFV 
installation, the potential safety benefits that may be derived from 
installing an EFV, and conditions for installation. The operator may 
choose how to word the specific information as long as they provide 
sufficient information to give customers a rational basis for deciding 
whether they want to request an EFV installation. The notification 
should also be written in plain language.

E. Customer Documentation

    Proposal: PHMSA proposed in the NPRM that each operator must 
maintain a copy of the customer EFV notice for 3 years. This notice 
must be available during PHMSA inspections or State inspections 
conducted under a pipeline safety program certified or approved by 
PHMSA under 49 U.S.C. 60105 or 60106.
    Comments: The majority of the comments submitted by industry and 
trade associations were an extension of the concerns regarding customer 
notification and focused on the idea that documenting individual 
notifications would be a major undertaking and a poor use of resources. 
While many operators and trade associations seemed to agree that using 
and documenting broad methods of communications (e.g., statements 
printed on customer bills, mailings, or electronic Web pages) would be 
reasonable, there were some differing opinions on how notifications 
should be documented.
    The AGA recommended that the final rule allow retention of a single 
copy of any notice, accompanied by a listing of the customers who 
received the mailing, or by documenting the electronic communication 
itself. The APGA noted that in the proposed rule's preamble, PHMSA 
stated that evidence of notification could include such items as a 
statement printed on customer bills or mailing. The APGA further noted 
that PHMSA did not propose to require operators to keep records showing 
that individual customers had been notified. SWG stated that while the 
section-by-section analysis indicated that operator evidence of 
notification could include such items as a statement printed on 
customer bills or mailings, the proposed regulatory text did not 
include such language.
    Some operators and trade associations discussed other issues 
pertaining to the 3-year recordkeeping requirement. SPPC and NGA noted 
that customer properties with frequent turnover would have multiple 
records for the same address that would need to be maintained and 
sorted for a period that could extend beyond the 3 years required by 
the regulations. The NPGA argued that PHMSA's recordkeeping requirement 
presented a greater burden than estimated. For large liquefied 
petroleum gas (LPG) operators, it would be a considerable clerical task 
to collect and review all EFV installation notifications to maintain a 
record spanning 3 years. The NPGA suggested that PHMSA permit the 
recordkeeping as an option rather than a requirement, which would allow 
LPG operators to choose best practices for their businesses and 
customers.
    PHMSA Response: PHMSA determined that several of the concerns 
raised by commenters in this section could be addressed through 
clarifying the proposed language and through revisions to the customer 
notification method.
    It was not PHMSA's intent to suggest that operators would need to 
transmit and document individual notifications to eligible customers. 
As a few of the commenters pointed out, PHMSA had indicated that a 
statement printed on customer bills or mailings would suffice as 
evidence for customer notification, but this language and intent was 
not incorporated into the proposed regulatory text. As PHMSA is 
allowing operators to notify customers through a broad range of 
electronic and traditional communications, the agency will also allow 
operators to retain a copy of the broad annual notification or 
notifications they are using to communicate with customers their right 
to request an EFV. In line with the 2008 Federal Pipeline Safety 
Regulations regarding operator evidence of customer notification, 
operators will be required to make a copy of the notice currently in 
use available during PHMSA inspections or inspections conducted under a 
program certified or approved by PHMSA under 49 U.S.C. 60105 or 60106 
without any further recordkeeping requirement or timeframe.

F. Installation Flexibility

    Proposal: PHMSA proposed in the NPRM that operators must install a 
manual service line shut-off valve for any new or replaced service line 
with an installed meter capacity exceeding 1,000 SCFH.
    Comments: Overall, operators and trade associations supported 
installing curb valves where EFVs are not feasible due to operational 
concerns. However, many operators and trade associations noted that the 
language, as proposed, did not allow operators flexibility for 
installing EFVs where possible on lines operating at greater than 1,000 
SCFH and also might require operators to install both an EFV and a 
manual service line shut-off valve on the same line.

[[Page 70995]]

    Several operators and trade associations, including SPPC, NMGC, 
AGA, NS, MAE, APGA, and SWG, suggested PHMSA revise the proposed 
regulatory text to give operators the option to install either an EFV 
or a manual service line shut-off valve based on sound engineering 
analysis and the availability of larger-format EFVs. The NMGC verified 
with EFV manufacturers, such as GasBreaker Inc., that EFVs are 
available and will meet the requirements necessary for operating on 
single-family residences above 1,000 SCFH. NS saw an opportunity to 
encourage operators to install EFVs on loads in excess of 1,000 SCFH, 
as NS has had success with installing EFVs in service lines for loads 
greater than 1,000 SCFH. The APGA believed the technology of EFVs and 
products available would continue to evolve, and in the future, some 
operators may test and become comfortable installing EFVs on some 
services operating above 1,000 SCFH. The APGA noted the rule should 
state that an operator need not install a curb valve if the operator 
installs an EFV on a service line instead. Further, SPPC noted that 
this requirement should be flexible enough to ensure that operators can 
account for increased loads in the future, such as being able to 
install a curb valve on a new service line with an initial load less 
than 1,000 SCFH but that might later exceed 1,000 SCFH so as to avoid 
the additional cost of replacing an EFV with a curb valve in the 
future.
    Additionally, NMGC, SWG, NGA, and AGA determined that under no 
circumstances should operators be required to install both an EFV and a 
manual service line shut-off valve on the same service line. The AGA 
noted that, as currently proposed, the regulations would require both a 
manual curb valve and an EFV on (1) any SFR operating at greater than 
1,000 SCFH or (2) a non-SFR operating at greater than 1,000 SCFH where 
an operator installed an EFV under DIMP. Further, as proposed, the rule 
could prohibit further innovation on EFVs that might be able to operate 
above 1,000 SCFH.
    The GPTC expressed a similar view on the issue, noting that the 
rule, as proposed, would not give an operator sufficient flexibility to 
use sound engineering practices to design an EFV on service lines with 
loads greater than 1,000 SCFH, in lieu of a manual curb valve. In the 
proposed Sec.  192.383(b)(4) and (5), PHMSA established a threshold of 
1,000 SCFH customer load over which an EFV was not required. However, 
there is no threshold limit of 1,000 SCFH for proposed Sec.  
192.383(b)(1), (2), and (3). The result is that a large SFR or branch 
to two large SFRs with a service line load greater than 1,000 SCFH 
would have both an EFV and a curb valve, but a multifamily residence 
with a service line load greater than 1,000 SCFH would require only an 
emergency curb valve, even if an EFV were available and suited for the 
application. The GPTC asked PHMSA to modify this section to allow 
greater flexibility.
    PHMSA Response: PHMSA did not intend to require that operators 
install both a curb valve and an EFV on the same service line and would 
like to give operators the flexibility to choose the proper safety 
valve. PHMSA has no objection to operators installing EFVs on lines 
with capacities over 1,000 SCFH, as long as that decision is reached 
through sound engineering analysis. To clarify, if an operator cannot 
or chooses not to install an EFV on an applicable service line with 
capacity over 1,000 SCFH, it must install a curb valve.
    PHMSA notes that it originally wanted to require operators install 
EFVs on service lines with loads up to 5,000 SCFH, as PHMSA knows that 
valves are available for these applications, and manufacturers have 
indicated they have sold EFVs for these load sizes. PHMSA chose the 
1,000 SCFH threshold, which was accepted by the GPAC, as a compromise 
based on comments from industry. Having operators perform a sound 
engineering analysis will allow PHMSA to verify operators are taking 
into account maximum loads and the capabilities of EFVs, if available, 
to handle those loads. An operator's engineering analysis for sizing an 
EFV should be based on maximum expected load throughout the year, 
including snap loads, critical supply applications, system 
configuration, and future anticipated loads (e.g., when commercial 
facilities in a shopping center change, gas loads would also change). 
In many instances, operators size EFVs based on meter capacity at the 
service. Operators must use caution in expanding EFV use to other 
larger commercial and multifamily dwelling applications due to the 
complexity of service line design and usage patterns.
    In response to SPPC's comment, PHMSA is not allowing manual valve 
installation for loads below 1,000 SCFH, even when future anticipated 
loads may exceed that threshold. In this final rule, PHMSA is allowing 
operators to install EFVs in lieu of manual valves in instances where 
loads exceed 1,000 SCFH. As operators already consider anticipated 
design loads and work with distribution system designers to determine 
proper system configurations and valve sizing when installing systems, 
operators should be able to install appropriate valves for future 
anticipated loads.
    PHMSA also considered the GPTC's comment. In the best professional 
judgment of PHMSA's subject matter experts, a SFR service line combined 
with a branch service to another SFR isn't known to exceed 1,000 SCFH, 
and typical houses consume anywhere from 100-250 SCF per day. However, 
commercial and industrial facilities can exceed 1,000 SCFH, and 
therefore the threshold is needed. Accordingly, in this final rule, 
PHMSA has amended the Federal Pipeline Safety Regulations at Sec.  
192.385(b) to require that operators install either a manual shut-off 
valve or, if possible, based on sound engineering analysis and 
availability, an EFV on lines operating at capacities exceeding 1,000 
SCFH.

G. Cost Recovery and Other Cost-Benefit Issues

    Proposal: In its NPRM, PHMSA proposed that existing service line 
customers who desire an EFV on service lines not exceeding 1,000 SCFH 
and not meeting one of the exceptions contained in paragraph (c) of 
Sec.  192.383 may request an EFV on their service lines. If a service 
line customer requests EFV installation, an operator must install the 
EFV at a mutually agreeable date. The appropriate State regulatory 
agency would determine who would bear the cost of installation and how 
the cost would be distributed.
    Comments: Operators and trade associations were strongly opposed to 
the final sentence in PHMSA's proposal that designated the appropriate 
State regulatory agency as the entity that would determine who would 
bear the cost of the requested EFV. Most of the comments questioned 
whether PHMSA had the legal authority to make such a statement and 
whether a State regulatory agency would be the appropriate authority 
for all cases. Specifically, the AGA, APGA, and GPTC noted that PHMSA 
lacked the jurisdiction to codify and regulate the manner by which 
utilities handle charges to customers.
    The NPGA noted that PHMSA's proposal to permit State regulatory 
authorities to determine what party is responsible for installation 
costs when a customer requests installation of an EFV presents 
particular concerns for LPG systems and businesses. PHMSA's deference 
to State agencies would impose disproportionately negative effects on 
operators of LPG systems compared to other utilities, since LPG 
pipeline operators are not regulated in

[[Page 70996]]

the same manner as natural gas utilities. The NPGA asked that PHMSA 
modify the proposal to assign the cost of EFV installation performed at 
a customer's request to the customer itself, as LPG businesses are not 
positioned to pass along additional costs to customers in the same 
manner as locally regulated utilities.
    NS noted that in previous amendments to Sec.  192.383 (EFV customer 
notification, Feb 3, 1998), the Research and Special Programs 
Administration, PHMSA's predecessor agency, acknowledged that the cost 
of installing an EFV on an existing line was to be the responsibility 
of the customer. Therefore, if PHMSA wishes to address who is to pay 
for the installation of EFVs on existing service lines, NS proposed 
that PHMSA adopt its previous requirement that the service line 
customer bear the cost. NS also believed this requirement would also be 
best addressed under Sec.  192.383(e).
    The APGA was vehemently opposed to the proposed language stating 
that the appropriate State regulatory agency would determine to whom 
and how the costs of the requested EFVs would be distributed, 
indicating that of the approximately 1,000 public gas utilities subject 
to the Federal Pipeline Safety Regulations, only a few have a State 
agency determining how the cost of gas service is distributed among 
customers. Whereas State public utility commissions (PUC) typically 
review and approve the rates charged by investor-owned and privately 
owned operators (which represent less than 25 percent of distribution 
operators regulated by PHMSA), rates for public distribution systems 
are typically approved by the municipality, utility board, or similar 
local oversight body. The APGA noted the preamble of the NPRM made 
clear that PHMSA did not intend to regulate how EFV costs would be 
recovered and did not believe it was PHMSA's intent to require public 
gas distribution operators to become subject to PUC review for EFV cost 
recovery. Rather, the APGA believed it was PHMSA's intent to ``leave 
the determination of how the cost of installing an EFV at customer 
request to the operator and whatever body approves the operator's gas 
rates.''
    Apart from PHMSA's proposal for determining cost recovery, some 
commenters discussed additional cost-benefit issues related to EFV 
installation on existing service lines. The APGA noted that operators 
should only be required to install EFVs if requesting customers also 
agree to whatever cost-recovery mechanism has been included in the 
operator's approved rates. The AGA, SWG, and NGA noted that the cost of 
retrofitting an EFV on an existing service line could be significant, 
with SWG adding that this cost was not included in PHMSA's cost-benefit 
analysis. The NGA further indicated that offering customers the option 
of installing EFVs on existing services not planned for replacement, 
excavation, or repair was not a cost-effective safety measure, and 
installing EFVs on existing services should be evaluated by each 
operator as a part of its integrity management planning.
    MAE requested a further analysis of the value and costs of 
installation, operations and maintenance, and leak rates on curb valves 
to determine whether there are more cost-efficient methods of emergency 
shut-off. A member of the GPAC also expressed concerns about PHMSA's 
cost-benefit numbers related to curb valves, suggesting that PHMSA 
reconsider including curb valve maintenance in the cost-benefit 
analysis and further analyze whether the incidents PHMSA used when 
examining the effectiveness and usefulness of curb valves were 
applicable to the analysis. Specifically, the GPAC member questioned 
whether, for the incidents PHMSA selected applicable to curb valves in 
its analysis, a curb valve on the line would have actually prevented 
fatalities, injuries, or property damage, noting that the narrative of 
a few of the accidents indicated some of the fatalities and injuries 
were actually caused by car crashes and not the subsequent gas 
incidents.
    PHMSA Response: It was not PHMSA's intent in the proposal to 
specifically delegate cost-recovery duties to State regulatory 
agencies, especially where certain operators do not have their rates 
set by these entities. In the Section-by-Section analysis of the NPRM, 
PHMSA noted it ``has no jurisdiction concerning natural gas rates or 
any costs incurred due to installation of an optional EFV at a 
consumer's request.'' PHMSA was only trying to indicate that it would 
defer to the existing rate-setting and cost-recovery structure under 
which operators currently operate. Therefore, PHMSA has removed the 
reference to ``State regulatory authority'' in the regulatory text 
applicable to cost recovery and has inserted ``The operator's rate-
setter'' to reflect this intent.
    PHMSA understands that the cost of installing an EFV on an existing 
line at the customer's request is more expensive than if the line were 
new or being replaced due to excavation and additional labor costs and 
determined it was not cost-effective to require the fitting of an EFV 
on all existing services.
    A 2007 National Regulatory Research Institute (NRRI) study titled 
``Survey on Excess Flow Valves: Installations, Cost, Operating 
Performance, and Gas Operator Policy,'' suggests that customer-
initiated EFV installations are quite rare, even in locations where 
they are currently allowed by local policy, and would not be a 
circumstance operators would be dealing with in significant numbers. 
However, without this provision, customers on existing lines without an 
EFV would essentially have no option to install an EFV, even if they 
highly valued the risk reduction that it provided and were willing to 
pay the full installation cost. These foregone transactions would 
represent deadweight loss. Although PHMSA determined that mandatory 
installation on all existing lines would not be cost-effective due to 
excavation and labor costs, some individual households might have a 
high willingness-to-pay for EFVs due to differences in risk aversion, 
rate of time preference, and other factors.
    Further, it is PHMSA's understanding that customers would typically 
be required to pay for these installations. From an economic 
standpoint, an EFV requested and paid for by a customer would actually 
increase the overall net benefit of the final rule, as PHMSA can infer 
from the customer's choice that they value the EFV's protection at a 
level greater than the cost they pay.\7\ Therefore, PHMSA has chosen to 
retain the right for existing customers to request an EFV installation 
if they are eligible.
---------------------------------------------------------------------------

    \7\ For retrofits, the benefits per valve would be essentially 
the same as calculated in the accompanying Regulatory Impact 
Analysis (a range of $4 to $44 at a 7 percent rate, depending on the 
customer type).
---------------------------------------------------------------------------

    As for the concern of whether applicable incidents were chosen to 
analyze the costs and benefits for curb valves, PHMSA applied 
reasonable filters to its data to choose appropriate and applicable 
incidents for analysis but there can be some level of uncertainty in 
such incident data. PHMSA is also aware of incidents that might have 
been prevented by the use of a curb valve, but these incidents were 
excluded from the analysis due to data limitations or for other 
reasons.
    In light of this particular comment, however, PHMSA reexamined and 
revised the incident set pertaining to curb valves in order to provide 
a more conservative cost-benefit analysis. For some of the incidents in 
question (e.g., where drivers crashed cars into meter sets), it is 
unlikely a curb valve would

[[Page 70997]]

have been effective in preventing the incident following impact, and 
these incidents were removed from the data set. The final Regulatory 
Impact Analysis is available in the docket.
    PHMSA notes that because a curb valve can allow gas flow to be shut 
off quickly, a curb valve could still be effective in mitigating the 
consequences of these incidents by shortening their duration, 
especially where property damage is concerned. Further, PHMSA's data is 
limited and often does not indicate clearly whether fatalities, if not 
caused by the initial impact, are due to injuries sustained during the 
crash or by the subsequent pipeline incident. For example, quickly 
shutting off the flow of gas at the site of an incident may be able to 
save the life of someone who has been knocked unconscious or has been 
otherwise incapacitated. Because of this, PHMSA still believes that 
installing EFVs and curb valves on service lines can provide a tangible 
safety benefit to the public and the environment.

H. Miscellaneous Comments

Effective Date
    Proposal: The NPRM proposed that each operator must install an EFV 
on any new or replaced service line for the services listed in the 
proposed Sec.  192.383(b) before those lines were activated and prior 
to January 3, 2014.
    Comments: Several operators and trade associations, including AGA, 
NS, and APGA, noted that the effective date for the proposed rule would 
impose the installation requirement retroactively. These commenters 
requested that operators be given at least 6 months to prepare for 
complying with the rule, including time to establish cost allocation 
with the appropriate rate-setter and to source the valves.
    PHMSA Response: This portion of the rule was drafted with the 2012 
statutory mandate in mind and did not necessarily indicate a 
retroactive requirement. PHMSA has revised the effective date in the 
final rule to allow operators 6 months to comply.
Exceptions to the Right To Request an EFV
    Proposal: The NPRM proposed that operators need not install an EFV 
if one or more of the following conditions were present: (1) The 
service line does not operate at a pressure of 10 psig or greater 
throughout the year; (2) the operator has prior experience with 
contaminants in the gas stream that could interfere with the EFV's 
operation or cause loss of service to a customer; (3) an EFV could 
interfere with necessary operation or maintenance activities, such as 
blowing liquids from the line; or (4) an EFV meeting performance 
standards in Sec.  192.381 is not commercially available to the 
operator.
    Comments: The AGA and APGA noted that because of these exemptions, 
operators should not be required to provide an individual notification 
to customers of their right to request an EFV if it is not feasible to 
install an EFV on that customer's service line. The APGA also noted 
that if most operators chose to satisfy the notification requirement 
through customer bills or other mass communication, every customer 
would still receive notification, regardless of whether EFV 
installation were impossible or impractical. The APGA also believed 
that PHMSA should reconsider applying the proposed requirements for the 
right to request an EFV and customer notification to master-meter 
operators. As master-meter operators typically serve ``garden-style'' 
apartments, mobile home parks, universities, public housing, et cetera, 
the ``customer'' is typically a renter and not an owner, which could 
potentially cause confusion as to who has the right to request an EFV.
    The AGA and SPPC asked that PHMSA consider exempting service lines 
that already had manual valves on them or lines where an operator might 
expect the load to increase beyond 1,000 SCFH and would install a 
manual valve instead.
    PHMSA Response: PHMSA noted that the AGA and APGA comments were 
submitted under the assumption that PHMSA was requiring individual 
communications to all customers. As the APGA noted, because PHMSA is 
allowing broad and electronic communication methods regarding EFV 
installation, all customers, regardless of their eligibility for EFV 
installation, will be receiving a form of notice. Further, PHMSA has 
determined that master-meter operators will largely be held to the same 
standards as other operators as far as EFV installation is concerned.
    PHMSA does not wish to include any further exceptions to the ones 
that were proposed. PHMSA is concerned that operators might interpret 
the fact that a service line already has a manual valve to mean that an 
EFV does not need to be installed. This would be an incorrect 
assumption. Applicable new and replaced service lines with loads not 
exceeding 1,000 SCFH must have EFVs installed on them. Moreover, as 
PHMSA is allowing installation flexibility for lines operating above 
1,000 SCFH, the agency believes it is unnecessary to provide a specific 
exemption for installing an EFV when the line could be expected to 
operate above 1,000 SCFH.
Definitions
    Comments: Several commenters requested definitions or clarification 
for a few terms in the NPRM. Specifically, SPPC asked PHMSA to add a 
definition of ``branch service line'' to Sec.  192.383(a). The APGA 
noted that SFR is not defined in part 192 and that PHMSA should add it 
to the definitions or spell out the term when used. The APGA also noted 
that PHMSA does not define who the ``customer'' is whom the operator 
must notify and who has the right to request an EFV. The APGA noted 
that, in the preamble, PHMSA states that messages on bills would 
satisfy the notification requirement, which appears to intend that the 
customer is the person to whom the utility sends the gas bill. The APGA 
urged PHMSA to clarify this definition if this is the case, as the term 
``customer'' might also be interpreted to mean the consumer of the gas, 
a resident at a rented property, or perhaps the owner of a property. 
These could all be different people. The GPTC recommended adding a 
reference to proposed Sec.  192.385(b) and (c) to refer back to Sec.  
192.383 and PHMSA's definition of replaced service line. MAE 
recommended PHMSA revise Sec.  192.381(a) to clarify whether EFVs are 
required for systems that normally operate at 10 psig but that have 
minimum design pressures of 5-6 psig for anticipated heavy-load 
conditions.
    PHMSA Response: PHMSA has added a definition of ``branch service 
line'' to the definitions paragraph of Sec.  192.383 and spelled out 
``SFR'' the first time it is used.
    While PHMSA does not delineate who the ``customer'' is in the 
regulatory text, the APGA is correct in that PHMSA intends the 
``customer'' to be the person to whom the utility sends the gas bill.
    PHMSA declined to add a reference in proposed Sec.  192.385(b) and 
(c) back to Sec.  192.383 regarding PHMSA's definition of a replaced 
service line. PHMSA intends curb valves installed under Sec.  192.385 
to be appropriate substitutes for EFVs and are not otherwise considered 
manual valves within the distribution network.
    Regarding MAE's comment, the language indicating that EFVs are to 
be used on service lines operating continuously throughout the year at 
a pressure not less than 10 p.s.i. (69 kPa) gage has been in the 
regulations since 1996. The only change that has been made since that 
time is the removal of the term ``single-family'' from ``service 
lines.'' PHMSA is aware, however, there

[[Page 70998]]

are service lines that experience pressure drops below 10 psig during 
heavy loading conditions. These lines are not required to have EFVs 
installed on them.
Editorial Comments
    Comments: NS suggested that proposed language concerning a mutually 
agreeable installation date should be moved to proposed Sec.  
192.383(e), which deals with notification requirements. The APGA was 
not clear on what ``EFV measures'' the reporting requirement refers to. 
The APGA suggested this is not a new reporting requirement but rather 
refers to the existing EFV reporting requirements in Sec.  191.11 and 
should either be deleted or clarified to make clear that it only 
applies to operators that are required to file annual reports.
    PHMSA Response: PHMSA considered these changes and made edits to 
the regulatory text where appropriate.
EFV Standard Development
    Comments: The GPTC noted that while it appreciated PHMSA's 
reference to the GPTC and its work, it still sought to clarify that the 
GPTC's Guide Material Appendix 192-8, which provides operators with 
guidance for developing a distribution integrity management program and 
compliance with certain sections of part 192, does not include 
information on the selection, sizing, or installation of EFVs. They 
noted that helpful guidance to assist operators in addressing EFV 
performance, selection, and installation considerations is found in MSS 
SP-115, ASTM F1802, and ASTM F2138. The GPTC also suggested that if 
PHMSA wants specific standards to be developed, then PHMSA should 
approach those organizations to develop such standards.
    The NGA commented that it did not believe that development of EFV 
standards was needed and that the development of design considerations 
would best be performed by the utilities themselves or by standards-
setting organizations, based on EFV manufacturer specifications 
considering customer load, meter size, service pipe size, and 
pressures.
    PHMSA Response: PHMSA solicited comments in the gas pipeline ANPRM 
on whether standards should be developed for EFVs. In the NPRM, PHMSA 
noted that it would not be incorporating by reference any new standards 
for EFVs into the Pipeline Safety Regulations but might do so in the 
future if the need arose.

V. Regulatory Notices and Analysis

A. Statutory/Legal Authority for This Rulemaking

    This final rule is published under the authority of the Federal 
pipeline safety laws (49 U.S.C. 60101 et seq.). Section 60102 of title 
49, U.S.C., authorizes the Secretary of Transportation to issue 
regulations governing the design, installation, inspection, emergency 
plans and procedures, testing, construction, extension, operation, 
replacement, and maintenance of pipeline service lines. Further, 
Section 60109(e)(3)(B) states that ``the Secretary, if appropriate, 
shall by regulation require the use of excess flow valves, or 
equivalent technology, where economically, technically, and 
operationally feasible on new or entirely replaced distribution branch 
services, multifamily facilities, and small commercial service 
facilities.''

B. Executive Order 12866, Executive Order 13563, and DOT Regulatory 
Policies and Procedures

    This final rule is a non-significant regulatory action under 
section 3(f) of Executive Order 12866 (58 FR 51735) and, therefore, was 
not reviewed by the Office of Management and Budget. This final rule is 
not significant under the Regulatory Policies and Procedures of the 
Department of Transportation (44 FR 11034) because of substantial 
stakeholder interest in pipeline safety.
    Executive Orders 12866 and 13563 require agencies regulate in the 
most cost-effective manner, make a reasoned determination that the 
benefits of the intended regulations justify its costs, and develop 
regulations that impose the least burden on society. PHMSA is providing 
the final Regulatory Impact Analysis (RIA) simultaneously with this 
rule, and it is available in the docket. The final RIA does not address 
the benefits and costs of the proposal to require operators to install 
EFVs on branched service lines providing gas service to SFRs because 
the benefits and costs of this proposal were addressed in the 
regulatory impact analysis for a previous rulemaking.\8\ The final RIA 
found that the estimated monetized benefits do not exceed the monetized 
costs in all cases. For the requirement of installing EFVs on new or 
replaced service lines providing gas service to multifamily residences, 
the monetized costs exceeded monetized benefits, even when using lower-
bound cost estimates. PHMSA believes that the amendments are 
nevertheless justified by significant unquantifiable benefits, such as 
avoided evacuations and environmental damage from EFV-preventable 
incidents, including incidents that could not be included in the 
analysis because they do not meet PHMSA's reporting criteria. EFVs also 
provide protection against a low-probability but high-consequence 
incident that could inflict mass casualties.
---------------------------------------------------------------------------

    \8\ ``Pipeline Safety: Integrity Management Programs for Gas 
Distribution Pipelines.'' December 4, 2009, (74 FR 63906) (RIN 2137-
AE15.
---------------------------------------------------------------------------

    PHMSA estimates a total impacted community of 4,448 operators for 
this rule (3,119 master meter/small LPG operators who will need to 
comply with notification requirements and 1,329 natural gas 
distribution operators who will need to install valves and comply with 
notification requirements) and 222,114 service lines per year on 
average. PHMSA assumed that valves do not have network effects; in 
other words, each EFV operates independently, and the costs and 
benefits of EFV installation simply scale linearly. The total 
annualized benefits of the rule are $5.5 million when discounted at 7 
percent, while the total annualized costs are $10.6 million. At the 3 
percent discount rate, the total benefits of the rule are $10.6 
million, while the costs are $12.0 million.
    The following table summarizes the annualized benefits and costs of 
this final rule:

  Table ES-1--Summary of Estimated Benefits and Costs ($ Millions) \1\
------------------------------------------------------------------------
        Customer category         Annualized benefit    Annualized cost
------------------------------------------------------------------------
Branched Line Single Family.....  See note..........  See note.
Multifamily Residence...........  1.0...............  6.2
Small Commercial................  1.6...............  1.1
Industrial/Other curb valve.....  3.0...............  3.0

[[Page 70999]]

 
All classifications:              Not estimated.....  0.3
 Notification & recordkeeping.
                                 ---------------------------------------
    Total.......................  5.5...............  10.6
------------------------------------------------------------------------
Note: Benefits and costs for branched SFR services accounted for in
  economic analysis of previous rulemaking (Distribution Integrity
  Management Program).
\1\ 50-year present value converted to annual equivalent using 7%
  discount rate.

    Additional unquantified benefit areas include:
     Equity: Provides a fair and equal level of safety to 
members of society who do not live in SFRs;
     Additional incident costs avoided for which no PHMSA 
incident data are available:
     Mitigates the consequences (death, injury, property 
damage) of incidents when customer piping or equipment is involved and 
thus the incident would not be reflected in PHMSA records;
     Additional incident costs that are not recorded in 
incident reports, including costs of evacuations, emergency response 
costs, and business downtime;
     Environmental externalities associated with methane 
releases (discussed in the RIA Appendix);
     Peace of mind for operators and customers; and
     Protection against seismic events and intentional 
tampering.
    Executive Order 13563 is supplemental to and reaffirms the 
principles, structures, and definitions governing regulatory review 
that were established in Executive Order 12866, Regulatory Planning and 
Review, of September 30, 1993. Additionally, Executive Order 13563 
specifically requires agencies to: (1) Involve the public in the 
regulatory process; (2) promote simplification and harmonization 
through interagency coordination; (3) identify and consider regulatory 
approaches that reduce burden and maintain flexibility; (4) ensure the 
objectivity of any scientific or technological information used to 
support regulatory action; and (5) consider how to best promote 
retrospective analysis to modify, streamline, expand, or repeal 
existing rules that are outmoded, ineffective, insufficient, or 
excessively burdensome. When developing this rule, PHMSA involved the 
public in the regulatory process in a variety of ways. Specifically, 
PHMSA considered public comments based on the proposals in the NPRM, 
addressed those comments in the docket, and discussed the proposals 
with the members of the GPAC and any public representatives in 
attendance.
    This final rule is expected to produce a safety benefit that 
addresses a congressional mandate and a NTSB safety recommendation and 
which can be implemented at relatively minor cost; similar regulations 
have been effective when applied to single-family residences. Further, 
industry has already shown a willingness to expand EFV applications, 
recognizing that EFVs have the potential to avert high-cost, low-
probability events that, while absent in the dataset for multifamily 
residences, can still occur.

C. Executive Order 13132: Federalism

    This final rule has been analyzed in accordance with the principles 
and criteria contained in Executive Order 13132 (``Federalism''). PHMSA 
issues pipeline safety regulations applicable to interstate and 
intrastate pipelines. The requirements in this rule apply to operators 
of distribution pipeline systems, which are primarily intrastate 
pipeline systems. Under 49 U.S.C. 60105, a State may regulate an 
intrastate pipeline facility or intrastate pipeline transportation 
after submitting a certification to PHMSA. Thus, State pipeline safety 
regulatory agencies with valid certifications on file with PHMSA will 
be the primary enforcers of the safety requirements proposed in this 
NPRM. Under 49 U.S.C. 60107, PHMSA provides grant money to 
participating States to carry out their pipeline safety enforcement 
programs. Although a few States choose not to participate in the 
natural gas pipeline safety grant program, every State has the option 
to participate. This grant money is used to defray additional costs 
incurred by enforcing the pipeline safety regulations.
    PHMSA has concluded this final rule does not include any regulation 
that: (1) Has substantial direct effects on States, relationships 
between the national government and the States, or distribution of 
power and responsibilities among various levels of government; (2) 
imposes substantial direct compliance costs on States and local 
governments; or (3) preempts State law. Therefore, the consultation and 
funding requirements of Executive Order 13132 (August 10, 1999; 64 FR 
43255) do not apply.

D. Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires an 
agency to review regulations to assess their impact on small entities, 
unless the agency determines that a rule will not have a significant 
impact on a substantial number of small entities. This final rule has 
been developed in accordance with Executive Order 13272 (``Proper 
Consideration of Small Entities in Agency Rulemaking'') and DOT's 
procedures and policies to promote compliance with the Regulatory 
Flexibility Act to ensure that potential impacts of rules on small 
entities are properly considered.
    This final rule requires gas pipeline operators to comply with the 
new EFV installation requirements. The Small Business Administration 
(SBA) criteria for defining a small business in the natural gas 
pipeline distribution industry is one that employs less than 1000 
employees as specified in the North American Industry Classification 
System (NAICS) codes. The RFA defines ``small governmental 
jurisdiction'' as the government of a city, county, town, township, 
village, school district, or special district with a population less 
than 50,000.
    To identify gas distribution operators affected by the proposed 
requirements that are small businesses or small governmental 
jurisdictions, PHMSA used information provided by Dun and Bradstreet. 
Dun and Bradstreet provides PHMSA with estimates of small business 
classifications based on SBA size standards for operators that file an 
annual report, along with a flag for public sector entities that is 
based on information such as entity name and NAICS code. These data 
indicate that approximately 60 percent of affected operators are public 
entities; among these, the share that are small governmental 
jurisdictions is not known. Among the private sector entities, 
approximately one-third are small entities according to the SBA size 
definition for their NAICS code. The most common of these is NAICS

[[Page 71000]]

221210, natural gas distribution, for which the standard is 1,000 
employees. Overall, while the number of small entities is not known 
with precision, it appears to be substantial when considering gas 
distribution operators that are small businesses or small governmental 
jurisdictions, as well as the master meter and small LPG operators that 
are presumed to be small entities.
    However, PHMSA determined that this rule does not have a 
significant economic impact on a substantial number of small entities. 
While the natural gas distribution industry includes many small 
entities, including both small businesses and small governmental 
jurisdictions, the impacts of the rule are clearly de minimus, both in 
relation to operator revenues and to the utility rate-payers to whom 
the incremental costs would ultimately be allocated. PHMSA's Regulatory 
Flexibility Analysis, which reached this determination, is available in 
the docket for this rulemaking.
    Accordingly, the head of the agency certifies under Section 605(b) 
of the RFA that this final rule will not have a significant economic 
impact on a substantial number of small entities because the additional 
costs are minimal.

E. Unfunded Mandates Reform Act of 1995

    This final rule does not impose unfunded mandates under the 
Unfunded Mandates Reform Act of 1995. It would not result in costs of 
$147.6 million, adjusted for inflation, or more in any one year to 
State, local, or tribal governments, in the aggregate, or to the 
private sector, and is the least burdensome alternative that achieves 
the objective of the final rule. Installation of EFVs and curb valves 
significantly protects the safety of the public and is technically and 
economically feasible.

F. National Environmental Policy Act

    PHMSA analyzed this final rule in accordance with section 102(2)(c) 
of the National Environmental Policy Act (42 U.S.C. 4332), the Council 
on Environmental Quality regulations (40 CFR parts 1500-1508), and DOT 
Order 5610.1C, and has determined that this action will not 
significantly affect the quality of the human environment. An 
environmental assessment of this final rule, which explains this 
determination, is available in the docket.

G. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    This final rule has been analyzed in accordance with the principles 
and criteria contained in Executive Order 13175 (``Consultation and 
Coordination with Indian Tribal Governments''). Because this rule does 
not have tribal implications and does not impose substantial direct 
compliance costs on Indian tribal governments, the funding and 
consultation requirements of Executive Order 13175 do not apply.

H. Executive Order 13211: Energy Supply, Distribution, or Use

    This final rule is not a ``significant energy action'' under 
Executive Order 13211 (Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use). It is not 
likely to have a significant adverse effect on supply, distribution, or 
energy use. Further, the Office of Information and Regulatory Affairs 
has not designated this final rule as a significant energy action.

I. Paperwork Reduction Act

    Pursuant to 5 CFR 1320.8(d), PHMSA is required to provide 
interested members of the public and affected agencies with an 
opportunity to comment on information collection and recordkeeping 
requests. As a result of the requirements of this rulemaking, the 
following information collection impacts are expected:
Gas Distribution Annual Report Revision
    PHMSA is revising Sec.  192.383 to require the installation of EFVs 
on applications beyond SFRs that are currently required. Further, PHMSA 
is adding Sec.  192.385, which would require the installation of manual 
service line shut-off valves. As a result, PHMSA wants to track the 
number of new installations related to these provisions on an annual 
basis. This will change the Gas Distribution Annual Report, which is 
contained in the currently approved information collection, titled 
``Annual Reports for Gas Distribution Operators,'' identified under OMB 
Control Number 2137-0629. PHMSA is revising the Gas Distribution Annual 
Report to collect the number of EFVs installed on multifamily dwellings 
and small commercial businesses and the number of manual service line 
shut-off valves installed. Currently, operators are required to submit 
the total number of EFVs installed on SFRs and the total number of EFVs 
within their systems. Therefore, PHMSA does not expect operators to 
experience an increase in burden beyond that already incurred for the 
Gas Distribution Annual Report. PHMSA has submitted an information 
collection revision request to OIRA to cover the components of this 
data collection. The request is under review and pending approval. 
PHMSA will publish a subsequent notice in the Federal Register upon the 
approval of this collection.
Customer Notification
    Section 192.383 of this final rule will require operators to notify 
customers of their right to request the installation of EFVs. Operators 
have multiple options for fulfilling this requirement, including adding 
a short statement to customer bills, incorporating a public awareness 
message on the company Web site, incorporating the notification on bill 
stuffers or in new customer packets, and posting a notice in a 
prominent location (for master-meter/small LPG operators). PHMSA 
estimates that approximately half of the 6,237 operators categorized as 
either master-meter operators or small LPG systems will be impacted, 
resulting in 3,119 affected operators. This estimate is based on the 
premise that only half of these operators have systems that can 
accommodate an EFV. PHMSA also estimates that 1,329 gas distribution 
operators will be impacted. Therefore, PHMSA estimates a total impacted 
community of 4,448 (3,119 master-meter/small LPG operators and 1,329 
gas distribution operators). PHMSA estimates that each impacted 
operator will take approximately 1 hour per year to create and complete 
this notification. PHMSA expects a vast majority of notifications to be 
made electronically, and, as such, expects the recordkeeping of these 
documents to be automatic and self-executing upon saving such 
documents. Consequently, PHMSA expects there to be no additional burden 
to the operator for saving the notifications for recordkeeping 
purposes. PHMSA estimates the total annual cost of this provision at 
$280,713 per year (4,448 operators * 1 hour/operator * $63.11/hour 
\9\). PHMSA has submitted a new information collection request to OIRA 
to cover the components of this data collection. The request is under 
review and pending approval. PHMSA will publish a subsequent notice in 
the Federal Register upon the approval of this collection.
---------------------------------------------------------------------------

    \9\ Bureau of Labor Statistics, Occupational Employment 
Statistics, May 2015. Occupation code 13-041, industry code 221200. 
http://www.bls.gov/oes/current/oes131041.htm.
---------------------------------------------------------------------------

    As a result of the changes listed above, PHMSA is submitting an

[[Page 71001]]

information collection revision request as well as a new information 
collection request to OMB for approval based on the requirements in 
this final rule. These information collections are contained in the 
pipeline safety regulations, 49 CFR parts 190-199. The following 
information is provided for these information collections: (1) Title of 
the information collection; (2) OMB control number; (3) Current 
expiration date; (4) Type of request; (5) Abstract of the information 
collection activity including a description of the changes applicable 
to the rulemaking action; (6) Description of affected public; (7) 
Estimate of total annual reporting and recordkeeping burden; and (8) 
Frequency of collection. The information collection burden for the 
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following information collection is requested as follows:

    1. Title: Annual Reports for Gas Distribution Operators.
    OMB Control Number: 2137-0629.
    Current Expiration Date: May 31, 2018.
    Type of Request: Revision.
    Abstract: This information covers the collection of annual report 
data for gas distribution pipeline operators. This information 
collection will only be revised to reflect the amendment to the Gas 
Distribution Annual Report, which will allow operators to submit the 
number of EFVs that are installed in multifamily dwellings and small 
commercial businesses and the number of manual service line shut-off 
valves installed. PHMSA does not expect this revision to result in a 
burden-hour increase.
    Affected Public: Gas Pipeline Operators.
    Annual Reporting and Recordkeeping Burden:
    Total Annual Responses: 1,446.
    Total Annual Burden Hours: 23,136.
    Frequency of Collection: On occasion.

    2. Title: Customer Notifications for Installation of Excess Flow 
Valves.
    OMB Control Number: TBD.
    Current Expiration Date: Not Applicable.
    Type of Request: New Information Collection.
    Abstract: This new information collection will cover the reporting 
and recordkeeping requirements for gas pipeline operators associated 
with the requirement of operators to notify customers of their right to 
request the installation of excess flow valves.
    Affected Public: Gas Pipeline Operators.
    Annual Reporting and Recordkeeping Burden:
    Total Annual Responses: 4,448 responses.
    Total Annual Burden Hours: 4,448 hours.
    Frequency of Collection: On occasion.

    Requests for a copy of this information collection should be 
directed to Angela Dow, Office of Pipeline Safety (PHP-30), Pipeline 
and Hazardous Materials Safety Administration (PHMSA), 2nd Floor, 1200 
New Jersey Avenue SE., Washington, DC 20590-0001, Telephone 202-366-
4595.

J. Privacy Act Statement

    In accordance with 5 U.S.C. 553(c), DOT solicits comments from the 
public to better inform its rulemaking process. DOT posts these 
comments, without edit, including any personal information the 
commenter provides, to www.regulations.gov, as described in the system 
of records notice (DOT/ALL-14 FDMS), which can be reviewed at 
www.dot.gov/privacy.

K. Regulation Identifier Number

    A regulation identifier number (RIN) is assigned to each regulatory 
action listed in the Unified Agenda of Federal Regulations. The 
Regulatory Information Service Center publishes the Unified Agenda in 
April and October of each year. The RIN contained in the heading of 
this document may be used to cross-reference this action with the 
Unified Agenda.

List of Subjects in 49 CFR Part 192

    Excess flow valve installation, Excess flow valve performance 
standards, Pipeline safety, Service lines.
    In consideration of the foregoing, PHMSA is amending 49 CFR part 
192 as follows:

PART 192--TRANSPORTATION OF NATURAL AND OTHER GAS BY PIPELINE: 
MINIMUM FEDERAL SAFETY STANDARDS

0
1. The authority citation for part 192 continues to read as follows:

    Authority:  49 U.S.C. 5103, 60102, 60104, 60108, 60109, 60110, 
60113, 60116, 60118, 60137, and 49 CFR 1.97.

0
2. In Sec.  192.381, paragraph (a) introductory text is revised to read 
as follows:


Sec.  192.381   Service lines: Excess flow valve performance standards.

    (a) Excess flow valves (EFVs) to be used on service lines that 
operate continuously throughout the year at a pressure not less than 10 
p.s.i. (69 kPa) gage must be manufactured and tested by the 
manufacturer according to an industry specification, or the 
manufacturer's written specification, to ensure that each valve will:
* * * * *

0
3. Section 192.383 is revised to read as follows:


Sec.  192.383   Excess flow valve installation.

    (a) Definitions. As used in this section:
    Branched service line means a gas service line that begins at the 
existing service line or is installed concurrently with the primary 
service line but serves a separate residence.
    Replaced service line means a gas service line where the fitting 
that connects the service line to the main is replaced or the piping 
connected to this fitting is replaced.
    Service line serving single-family residence means a gas service 
line that begins at the fitting that connects the service line to the 
main and serves only one single-family residence (SFR).
    (b) Installation required. An EFV installation must comply with the 
performance standards in Sec.  192.381. After April 17, 2016, each 
operator must install an EFV on any new or replaced service line 
serving the following types of services before the line is activated:
    (1) A single service line to one SFR;
    (2) A branched service line to a SFR installed concurrently with 
the primary SFR service line (i.e., a single EFV may be installed to 
protect both service lines);
    (3) A branched service line to a SFR installed off a previously 
installed SFR service line that does not contain an EFV;
    (4) Multifamily residences with known customer loads not exceeding 
1,000 SCFH per service, at time of service installation based on 
installed meter capacity, and
    (5) A single, small commercial customer served by a single service 
line with a known customer load not exceeding 1,000 SCFH, at the time 
of meter installation, based on installed meter capacity.
    (c) Exceptions to excess flow valve installation requirement. An 
operator need not install an excess flow valve if one or more of the 
following conditions are present:
    (1) The service line does not operate at a pressure of 10 psig or 
greater throughout the year;
    (2) The operator has prior experience with contaminants in the gas 
stream that could interfere with the EFV's operation or cause loss of 
service to a customer;
    (3) An EFV could interfere with necessary operation or maintenance 
activities, such as blowing liquids from the line; or

[[Page 71002]]

    (4) An EFV meeting the performance standards in Sec.  192.381 is 
not commercially available to the operator.
    (d) Customer's right to request an EFV. Existing service line 
customers who desire an EFV on service lines not exceeding 1,000 SCFH 
and who do not qualify for one of the exceptions in paragraph (c) of 
this section may request an EFV to be installed on their service lines. 
If an eligible service line customer requests an EFV installation, an 
operator must install the EFV at a mutually agreeable date. The 
operator's rate-setter determines how and to whom the costs of the 
requested EFVs are distributed.
    (e) Operator notification of customers concerning EFV installation. 
Operators must notify customers of their right to request an EFV in the 
following manner:
    (1) Except as specified in paragraphs (c) and (e)(5) of this 
section, each operator must provide written or electronic notification 
to customers of their right to request the installation of an EFV. 
Electronic notification can include emails, Web site postings, and e-
billing notices.
    (2) The notification must include an explanation for the service 
line customer of the potential safety benefits that may be derived from 
installing an EFV. The explanation must include information that an EFV 
is designed to shut off the flow of natural gas automatically if the 
service line breaks.
    (3) The notification must include a description of EFV installation 
and replacement costs. The notice must alert the customer that the 
costs for maintaining and replacing an EFV may later be incurred, and 
what those costs will be to the extent known.
    (4) The notification must indicate that if a service line customer 
requests installation of an EFV and the load does not exceed 1,000 SCFH 
and the conditions of paragraph (c) are not present, the operator must 
install an EFV at a mutually agreeable date.
    (5) Operators of master-meter systems and liquefied petroleum gas 
(LPG) operators with fewer than 100 customers may continuously post a 
general notification in a prominent location frequented by customers.
    (f) Operator evidence of customer notification. An operator must 
make a copy of the notice or notices currently in use available during 
PHMSA inspections or State inspections conducted under a pipeline 
safety program certified or approved by PHMSA under 49 U.S.C. 60105 or 
60106.
    (g) Reporting. Except for operators of master-meter systems and LPG 
operators with fewer than 100 customers, each operator must report the 
EFV measures detailed in the annual report required by Sec.  191.11.

0
4. Section 192.385 is added to subpart H to read as follows:


Sec.  192.385   Manual service line shut-off valve installation.

    (a) Definitions. As used in this section:
    Manual service line shut-off valve means a curb valve or other 
manually operated valve located near the service line that is safely 
accessible to operator personnel or other personnel authorized by the 
operator to manually shut off gas flow to the service line, if needed.
    (b) Installation requirement. The operator must install either a 
manual service line shut-off valve or, if possible, based on sound 
engineering analysis and availability, an EFV for any new or replaced 
service line with installed meter capacity exceeding 1,000 SCFH.
    (c) Accessibility and maintenance. Manual service line shut-off 
valves for any new or replaced service line must be installed in such a 
way as to allow accessibility during emergencies. Manual service shut-
off valves installed under this section are subject to regular 
scheduled maintenance, as documented by the operator and consistent 
with the valve manufacturer's specification.

    Issued in Washington, DC, on October 7, 2016, under authority 
delegated in 49 CFR Part 1.97.
Marie Therese Dominguez,
Administrator.
[FR Doc. 2016-24817 Filed 10-13-16; 8:45 am]
 BILLING CODE 4910-60-P