Interstate and Intrastate Natural Gas Pipelines; Rate Changes Relating to Federal Income Tax Rate American Forest & Paper Association, 29503-29506 [2021-11353]
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Federal Register / Vol. 86, No. 104 / Wednesday, June 2, 2021 / Rules and Regulations
Implementation Guide, (WEQ Version
003.3, March 30, 2020);
(xiv) WEQ–015, Measurement and
Verification of Wholesale Electricity
Demand Response (WEQ Version 003.3,
March 30, 2020);
(xv) WEQ–021, Measurement and
Verification of Energy Efficiency
Products (WEQ Version 003.3, March
30, 2020);
(xvi) WEQ–022, Electric Industry
Registry (WEQ Version 003.3, March 30,
2020); and
29503
(xvii) WEQ–023, Modeling. (WEQ
Version 003.3, March 30, 2020).
Note: The following appendix will not be
published in the Code of Federal Regulations
Appendix I
STANDARDS AFFECTED BY THE REVISIONS TO IMPLEMENT RECOMMENDATIONS FOLLOWING SANDIA’S SURETY
ASSESSMENT ON CYBERSECURITY
Standard
Revisions
WEQ–000–1
Deleted seven abbreviations/acronyms ...................................................
Added one abbreviation/acronym .............................................................
DNS—Domain Name Service.
IPCP—Internet Protocol Control Protocol.
NTP—Network Time Protocol.
PPP—Point to Point Protocol.
SLIP—Serial Line Internet Protocol.
SNMP—Simple Network Management Protocol.
SSL—Secure Sockets Layer.
OWASP—Open Web Application Security Project.
WEQ–001
Revised one standard ..............................................................................
WEQ–001–13.1.3.3.
WEQ–002
Revised 14 standards ...............................................................................
[FR Doc. 2021–11352 Filed 6–1–21; 8:45 am]
BILLING CODE 6717–01–P
DEPARTMENT OF ENERGY
Federal Energy Regulatory
Commission
18 CFR Parts 154, 260, and 284
[Docket Nos. RM18–11–002 and RP18–415–
002; Order No. 849–B]
Interstate and Intrastate Natural Gas
Pipelines; Rate Changes Relating to
Federal Income Tax Rate American
Forest & Paper Association
Federal Energy Regulatory
Commission, Department of Energy.
ACTION: Final rule.
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AGENCY:
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rates in light of the income tax
reductions provided by the Tax Cuts
and Jobs Act and the Commission’s
revised policy and precedent
concerning tax allowances to address
the double recovery issue identified by
United Airlines, Inc. v. FERC. These
procedures also allowed interstate
natural gas pipelines to voluntarily
reduce their rates. In this final rule, the
Commission finds that there are no
more expected filings that will make use
of these special procedures, which are
uniquely tied to the Tax Cuts and Jobs
Act, and that all existing proceedings
under these procedures have closed.
Therefore, the Commission removes the
procedures from the Code of Federal
Regulations as obsolete.
DATES:
This rule is effective August 2,
2021.
Order No. 849 adopted
procedures for determining which
jurisdictional natural gas pipelines may
be collecting unjust and unreasonable
SUMMARY:
WEQ–002–2.3.
WEQ–002–2.4.
WEQ–002–4.2.1.1.
WEQ–002–4.2.1.2.
WEQ–002–4.2.1.3.
WEQ–002–4.2.2.
WEQ–002–5.
WEQ–002–5.1.1.
WEQ–002–5.1.2.
WEQ–002–5.1.3.
WEQ–002–5.6.
WEQ–002–101.2.3.1.
WEQ–002–101.3.3.2.
WEQ–002–101.3.3.3.
FOR FURTHER INFORMATION CONTACT:
Vince Mareino (Legal Information),
Office of the General Counsel, 888 First
PO 00000
Frm 00021
Fmt 4700
Sfmt 4700
Street NE, Washington, DC 20426, (202)
502–6167, Vince.Mareino@ferc.gov.
Laura Kane (Technical Information),
Office of Energy Market Regulation, 888
First Street NE, Washington, DC 20426,
(202) 502–8653, Laura.Kane@ferc.gov.
SUPPLEMENTARY INFORMATION:
I. Background
1. On July 18, 2018, the Commission
issued a final rule 1 (Order No. 849)
adopting procedures for determining
which jurisdictional natural gas
pipelines may be collecting unjust and
unreasonable rates in light of the
income tax reductions provided by the
Tax Cuts and Jobs Act 2 and the
Commission’s Revised Policy
1 Interstate & Intrastate Nat. Gas Pipelines; Rate
Changes Relating to Fed. Income Tax Rate, Order
No. 849, 83 FR 36672 (July 30, 2018), 164 FERC
¶ 61,031 (2018).
2 An Act to provide for reconciliation pursuant to
titles II and V of the concurrent resolution on the
budget for fiscal year 2018, Public Law 115–97, 131
Stat. 2054 (2017) (Tax Cuts and Jobs Act).
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Statement 3 and precedent 4 concerning
tax allowances to address the double
recovery issue identified by United
Airlines, Inc. v. FERC.5 These
procedures also allowed interstate
natural gas pipelines to voluntarily
reduce their rates. On April 18, 2019,
the Commission denied all outstanding
requests for rehearing and reaffirmed
the Commission’s determinations in
Order No. 849 (Order No. 849–A).6
2. Order No. 849 established a
requirement, pursuant to sections 10
and 14(a) of the Natural Gas Act (NGA),7
that all interstate natural gas companies
with cost-based stated rates that filed a
2017 FERC Form No. 2 or 2–A must file
the FERC Form No. 501–G informational
filing for the purpose of evaluating the
impact of the Tax Cuts and Jobs Act and
the United Airlines Issuances on
interstate natural gas pipelines’ revenue
requirements. In addition to the FERC
Form No. 501–G filing requirement, the
Commission provided four options for
each interstate natural gas pipeline to
make a filing to address the changes to
the pipeline’s recovery of tax costs or
explain why no action is needed: (1) A
limited NGA section 4 8 rate reduction
filing (Option 1), (2) a commitment to
file a general section 4 rate case or
prepackaged settlement in the near
future (Option 2), (3) an explanation
why no rate change is needed (Option
3), and (4) no action (Option 4). These
procedures were intended to encourage
natural gas pipelines to voluntarily
reduce their rates to the extent the tax
changes result in their over-recovering
their cost of service, while also
providing the Commission and
stakeholders information necessary to
take targeted actions under NGA section
5 9 where necessary to achieve just and
reasonable rates.
3. Order No. 849 made three changes
to the Code of Federal Regulations.
First, new § 260.402 of the
Commission’s regulations established
the FERC Form No. 501–G filing
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3 Inquiry
Regarding the Commission’s Policy for
Recovery of Income Tax Costs, 81 FR 94366 (Dec.
23, 2016), 162 FERC ¶ 61,227 (Revised Policy
Statement), order on reh’g, 83 FR 12362 (March 21,
2018), 164 FERC ¶ 61,030 (2018) (Revised Policy
Statement Rehearing).
4 SFPP, L.P., Opinion No. 511–C, 162 FERC
¶ 61,228, at P 9 (2018).
5 827 F.3d 122 (D.C. Cir. 2016) (United Airlines).
For purposes of this order, the Revised Policy
Statement, United Airlines, and Opinion No. 511–
C will collectively be referred to as ‘‘United Airlines
Issuances.’’
6 Interstate & Intrastate Nat. Gas Pipelines; Rate
Changes Relating to Fed. Income Tax Rate, Order
No. 849–A, 84 FR 17739 (April 26, 2019), 167 FERC
¶ 61,051 (2019).
7 15 U.S.C. 717i(a), 717m(a).
8 15 U.S.C. 717c.
9 15 U.S.C. 717d.
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requirement described above.10 Second,
new § 154.404 of the Commission’s
regulations established the regulations
necessary to govern Option 1, the
limited NGA section 4 rate reduction
filings.11 Options 2, 3, and 4 above did
not require any change in regulations, as
they could proceed under preexisting
regulatory authority. Third, new
§ 284.123(i) of the Commission’s
regulations provided procedures for
section 311 of the National Gas Policy
Act of 1978 (NGPA) 12 and Hinshaw 13
pipelines to establish fair and equitable
rates for their interstate services.14
II. Discussion
4. In Order No. 849, the Commission
identified 129 interstate natural gas
pipelines with cost-based rates that
were required to file the FERC Form No.
501–G, codified in § 260.402. As of the
date of Order No. 849–A, the
Commission had received filings from
all 129 identified pipelines.15 As of
April 15, 2021, all of these FERC Form
No. 501–G filings have been accepted
for filing, and the proceedings
terminated. Because Order No. 849
established a one-time reporting
requirement tied to a past event, it
would not apply to any new pipelines
that may enter the market in the future.
Therefore, the regulations implemented
in Order No. 849 are no longer needed,
and we hereby remove § 260.402 from
the Commission’s regulations.
5. Eleven pipelines chose Option 1,
codified in § 154.404. Under Option 1,
pipelines could only choose to make
these limited NGA section 4 rate
reduction filings at the time of their
FERC Form No. 501–G filings. Just as no
new FERC Form No. 501–G filings are
possible, likewise no new filings under
§ 154.404 are possible.
6. For any of these limited NGA
section 4 rate reduction filings that
proceeded to hearing, § 154.404 also
governs the process by which these
hearings are adjudicated, so it would
not have been reasonable to remove
§ 154.404 before all the existing hearings
concluded, either with the acceptance of
a settlement or with the publication of
an Initial Decision. There are no
remaining dockets that are either in an
10 18
CFR 260.402.
CFR 154.404.
12 15 U.S.C. 3371.
13 Section 1(c) of the NGA, 15 U.S.C. 717(c),
exempts from the Commission’s NGA jurisdiction
those pipelines which transport gas in interstate
commerce if: (1) They receive natural gas at or
within the boundary of a state, (2) all the gas is
consumed within that state, and (3) the pipeline is
regulated by a state Commission. This is known as
the Hinshaw exemption.
14 18 CFR 284.123(i).
15 Order No. 849–A, 167 FERC ¶ 61,051 at P 4.
11 18
PO 00000
Frm 00022
Fmt 4700
Sfmt 4700
Option 1 hearing or eligible to be set for
an Option 1 hearing. As a result, the
regulations governing this type of
limited NGA section 4 rate reduction
filings are no longer needed. We shall
therefore remove § 154.404 of the
Commission’s regulations.
7. Order No. 849 also established
separate regulations under § 284.123(i)
to address the unique jurisdictional
situation of section 311 and Hinshaw
pipelines, which have their interstate
rates regulated by the Commission, but
which are primarily regulated at the
state level. Under pre-existing policy,
the Commission reviews the rates of
section 311 and Hinshaw pipelines
every five years on a rolling basis.16
Section 284.123(i), in brief, provided a
mechanism to lower these pipelines’
interstate rates prior to their five-year
review, in the event that state
government regulators also adjusted
their rates in light of the recent changes
in tax code and tax policy. In the threeand-a-half years from the passage of the
Tax Cuts and Jobs Act in November
2017 until the present, almost all
section 311 and Hinshaw pipelines have
either come before the Commission for
their five-year review, or have come
before the Commission for an out-ofcycle rate review, whether due to
§ 284.123(i), voluntary action, or the
other requirements of section 284 of the
Commission’s regulations that can
compel an out-of-cycle rate review. The
Commission, through its own review,
finds it is unlikely that the remaining
section 311 and Hinshaw pipelines will
trigger § 284.123(i), and in any event all
are due for their five-year review in the
near future under the Commission’s preexisting policy. As a result, the special
circumstances presented by the Tax
Cuts and Jobs Act that required
§ 284.123(i) are no longer present. We
shall therefore remove § 284.123(i) of
the Commission’s regulations.
III. Regulatory Requirements
A. Information Collection Statement
8. The Paperwork Reduction Act 17
requires each Federal agency to seek
and obtain the Office of Management
and Budget’s (OMB) approval before
undertaking a collection of information
(including reporting, record keeping,
and public disclosure requirements)
16 Contract Reporting Requirements of Intrastate
Nat. Gas Cos., Order No. 735, 75 FR 29404 (May
26, 2010), 131 FERC ¶ 61,150, at P 96, order on
reh’g, Order No. 735–A, 75 FR 80685 (Dec. 23,
2010), 133 FERC ¶ 61,216 (2010); see also
Hattiesburg Indus. Gas Sales, L.L.C., 134 FERC
¶ 61,236 (2011) (imposing a five-year rate review
requirement on Hattiesburg Industrial Gas Sales,
L.L.C.).
17 44 U.S.C. 3501–3521.
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Federal Register / Vol. 86, No. 104 / Wednesday, June 2, 2021 / Rules and Regulations
directed to ten or more persons or
contained in a rule of general
applicability. OMB regulations require
approval of certain information
collection requirements contemplated
by final rules (including deletion,
revision, or implementation of new
requirements). Upon approval of a
collection of information, OMB will
assign an OMB control number and an
expiration date. Respondents subject to
the filing requirements of a rule will not
be penalized for failing to respond to the
collection of information unless the
collection of information displays a
valid OMB control number. The
following discussion describes and
analyzes the collection of information to
be deleted by this final rule.
9. Public Reporting Burden: In this
final rule, the Commission eliminates
FERC Form No. 501–G 18 (One-time
Report on Rate Effect of the Tax Cuts
and Jobs Act). This final rule eliminates
an existing data collection, FERC–501G
(OMB Control No. 1902–0302). Order
No. 849 (in Docket No. RM18–11–000)
allowed the Commission to determine
which jurisdictional natural gas
pipelines may be collecting unjust and
unreasonable rates in light of the recent
reduction in the corporate income tax
rate in the Tax Cuts and Jobs Act and
changes to the Commission’s income tax
allowance policies following the United
Airlines decision. FERC Form No. 501–
G collected information as to whether
the pipeline was a pass-through entity.
FERC Form No. 501–G collected income
and balance sheet statement financial
data from all NGA pipelines that have
stated cost-based rates on file with the
Commission. NGA pipelines whose
rates were examined in a general rate
case under section 4 of the NGA or in
an investigation under section 5 of the
29505
NGA were not required to file FERC
Form No. 501–G.
10. The Commission identified 129
interstate natural gas pipelines with
cost-based rates that were required to
file the adopted FERC Form No. 501–G.
Interstate natural gas pipelines had four
options as to how to address the results
of the formula contained in the FERC
Form No. 501–G. Each option has a
different burden profile and a different
cost per response. Companies made
their own business decisions as to
which option they selected. This final
rule eliminates FERC Form No. 501–G
which reduces burden on all applicants.
11. All burden from FERC Form No.
501–G has already been incurred. For
informational purposes, the previous
estimate of burden and cost for the nowcomplete FERC Form No. 501–G
collection follows.
FERC–501G—RATE CHANGES RELATING TO FEDERAL CORPORATE INCOME TAX RATE FOR INTERSTATE NATURAL GAS
PIPELINES, TO BE ELIMINATED BY THE FINAL RULE IN DOCKET NO. RM18–11–002
Respondents
Responses
per
respondent
Total
responses
Average
burden hour
per response
Average
cost per
response
Total
burden hours
Total cost
($)
(1)
(2)
(1) * (2) = (3)
(4)
(5)
(1) * (4) = (6)
(1) * (5) = (7)
Interstate Natural Gas Pipelines With Cost-Based Rates
FERC Form No. 501–
G, One-time Report
(reduction) 19 .............
129
1
* 129
* 9 hrs.
* $756
* 1,161
* $97,524
Optional Response
No Response (reduction) ...........................
Case for no change (reduction) .....................
Limited Sec 4 filing (reduction) 20 .................
General Sec. 4 filing
(reduction) 21 .............
51
0
0
0
0
0
0
62
1
62
5
420
310
26,040
15
1
15
6
504
90
7,560
1
1
1
22 512
42,968
512
42,968
NGPA Section 311 and Hinshaw Pipelines With Cost-Based Rates
NGPA rate filing (reduction) 23 .......................
24 15
1
15
24
2,015
360
30,225
Total, To Be Eliminated by RM18–
11–002 ..............
25 144
........................
* 222
........................
........................
* 2,433
* 204,317
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* (reduction).
12. This final rule eliminates all
information collection and
recordkeeping requirements associated
with RM18–11–000. The removal of the
FERC–501G eliminates the estimated
annual information collection burden
(2,433 hours) and cost ($204,317)
associated with FERC–501G (OMB
Control No. 1902–0302).
B. Environmental Analysis
18 FERC–501G has also been referenced as FERC
Form No. 501–G.
19 18 CFR 260.402 (as revised).
20 18 CFR 154.404 (as revised).
21 18 CFR 154.312.
22 The estimate for hours is based on the
estimated average hours per response for the FERC–
545 (OMB Control No. 1902–0154), with general
NGA section 4, 18 CFR 154.312 filings weighted at
a ratio of 20 to one.
23 18 CFR 284.123(i) (as revised).
24 Estimate of number of respondents assumes
that states will act within one year to reduce NGPA
section 311 and Hinshaw pipeline rates to reflect
the Tax Cuts and Jobs Act.
25 Number of unique respondents = (One-time
Report) + (NGPA rate filing).
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13. The Commission is required to
prepare an Environmental Assessment
or an Environmental Impact Statement
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for any action that may have a
significant adverse effect on the human
environment.26 The actions taken here
fall within categorical exclusions in the
Commission’s regulations for rules
regarding information gathering,
analysis, and dissemination.27
Therefore, an environmental review is
unnecessary and has not been prepared
in this rulemaking.
C. Regulatory Flexibility Act
14. The Regulatory Flexibility Act of
1980 (RFA) 28 generally requires a
description and analysis of final rules
that will have significant economic
impact on a substantial number of small
entities. The RFA mandates
consideration of regulatory alternatives
that accomplish the stated objectives of
a rulemaking while minimizing any
significant economic impact on a
substantial number of small entities. In
lieu of preparing a regulatory flexibility
analysis, an agency may certify that a
final rule will not have a significant
economic impact on a substantial
number of small entities.29 In Order No.
849, the Commission found that the
institution of the new regulations would
not have a significant impact on a
substantial number of small entities.30
Most of the natural gas pipelines
regulated by the Commission do not fall
within the RFA’s definition of a small
entity.31 For the same reasons, removing
these regulations will not have a
significant impact on a substantial
number of small entities.
D. Document Availability
15. In addition to publishing the full
text of this document in the Federal
Register, the Commission provides all
interested persons an opportunity to
view and/or print the contents of this
document via the internet through the
Commission’s Home Page (https://
www.ferc.gov). At this time, the
Commission has suspended access to
the Commission’s Public Reference
Room due to the President’s March 13,
2020 proclamation declaring a National
Emergency concerning the Novel
Coronavirus Disease (COVID–19).
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26 Regulations
Implementing the National
Environmental Policy Act of 1969, Order No. 486,
52 FR 47897 (Dec. 17, 1987), FERC Stats. & Regs.
¶ 30,783 (1987) (cross-referenced at 41 FERC
¶ 61,284).
27 See 18 CFR 380.4(a)(2)(ii) and (a)(5).
28 5 U.S.C. 601–612.
29 5 U.S.C. 605(b).
30 Order No. 849, 164 FERC ¶ 61,031 at P 296.
31 In Order No. 849, the Commission determined
3.9% of the total potential NGA respondents and
5.1% of the total NGPA section 311 and Hinshaw
pipelines could be considered a small entity.
Eliminating the filing requirement would eliminate
any burden and cost from FERC–501G for small and
large entities.
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16. From the Commission’s Home
Page on the internet, this information is
available on eLibrary. The full text of
this document is available on eLibrary
in PDF and Microsoft Word format for
viewing, printing, and/or downloading.
To access this document in eLibrary,
type the docket number excluding the
last three digits of this document in the
docket number field.
17. User assistance is available for
eLibrary and the Commission’s website
during normal business hours from
FERC Online Support at 202–502–6652
(toll free at 1–866–208–3676) or email at
ferconlinesupport@ferc.gov, or the
Public Reference Room at (202) 502–
8371, TTY (202) 502–8659. Email the
Public Reference Room at
public.referenceroom@ferc.gov.
E. Effective Date and Congressional
Notification
18. These regulations are effective
August 2, 2021. This rule does not alter
the substantive rights or interests of any
interested persons, and it merely
removes certain outdated and
nonessential natural gas regulations
from the Commission’s body of
regulations on a prospective basis.
Therefore, prior notice and comment
under section 4 of the Administrative
Procedure Act (APA) 32 are unnecessary.
The Commission has determined that
this rule is not a ‘‘major rule’’ as defined
in section 351 of the Small Business
Regulatory Enforcement Fairness Act of
1996.
List of Subjects
Natural gas, Reporting and
recordkeeping requirements.
■
[Removed]
2. Remove § 154.404.
PART 260—STATEMENTS AND
REPORTS (SCHEDULES)
3. The authority citation for part 260
continues to read as follows:
■
Authority: 15 U.S.C. 717–717w, 3301–
3432; 42 U.S.C. 7101–7352.
§ 260.402
■
[Removed]
4. Remove § 260.402.
PART 284—CERTAIN SALES AND
TRANSPORTATION OF NATURAL GAS
UNDER THE NATURAL GAS POLICY
ACT OF 1978 AND RELATED
AUTHORITIES
5. The authority citation for part 284
continues to read as follows:
■
Authority: 15 U.S.C. 717–717z, 3301–
3432; 42 U.S.C. 7101–7352; 43 U.S.C. 1331–
1356.
§ 284.123
■
[Amended]
6. In § 284.123, remove paragraph (i).
[FR Doc. 2021–11353 Filed 6–1–21; 8:45 am]
BILLING CODE 6717–01–P
DEPARTMENT OF JUSTICE
Continental shelf, Natural gas,
Reporting and recordkeeping
requirements.
By the Commission.
Issued: May 20, 2021.
Kimberly D. Bose,
Secretary.
In consideration of the foregoing, the
Commission amends parts 154, 260, &
284, chapter I, title 18, Code of Federal
Regulations, as follows:
U.S.C. 553(b).
Sfmt 4700
[Docket No. DEA–658]
Drug Enforcement
Administration, Department of Justice.
ACTION: Final rule.
AGENCY:
18 CFR Part 284
Fmt 4700
§ 154.404
Schedules of Controlled Substances:
Placement of Remimazolam in
Schedule IV
18 CFR Part 260
Frm 00024
Authority: 15 U.S.C. 717–717w; 31 U.S.C.
9701; 42 U.S.C. 7102–7352.
21 CFR Part 1308
Natural gas, Pipelines, Reporting and
recordkeeping requirements.
PO 00000
1. The authority citation for part 154
continues to read as follows:
■
Drug Enforcement Administration
18 CFR Part 154
32 5
PART 154—RATE SCHEDULES AND
TARIFFS
This final rule adopts,
without change, an interim final rule
with request for comments published in
the Federal Register on October 6, 2020,
placing the substance remimazolam,
including its salts, isomers, and salts of
isomers whenever the existence of such
salts, isomers, and salts of isomers is
possible, in schedule IV of the
Controlled Substances Act. With the
issuance of this final rule, DEA
maintains remimazolam, including its
salts, isomers, and salts of isomers
whenever the existence of such salts,
SUMMARY:
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]]>Agencies
[Federal Register Volume 86, Number 104 (Wednesday, June 2, 2021)]
[Rules and Regulations]
[Pages 29503-29506]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-11353]
-----------------------------------------------------------------------
DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
18 CFR Parts 154, 260, and 284
[Docket Nos. RM18-11-002 and RP18-415-002; Order No. 849-B]
Interstate and Intrastate Natural Gas Pipelines; Rate Changes
Relating to Federal Income Tax Rate American Forest & Paper Association
AGENCY: Federal Energy Regulatory Commission, Department of Energy.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: Order No. 849 adopted procedures for determining which
jurisdictional natural gas pipelines may be collecting unjust and
unreasonable rates in light of the income tax reductions provided by
the Tax Cuts and Jobs Act and the Commission's revised policy and
precedent concerning tax allowances to address the double recovery
issue identified by United Airlines, Inc. v. FERC. These procedures
also allowed interstate natural gas pipelines to voluntarily reduce
their rates. In this final rule, the Commission finds that there are no
more expected filings that will make use of these special procedures,
which are uniquely tied to the Tax Cuts and Jobs Act, and that all
existing proceedings under these procedures have closed. Therefore, the
Commission removes the procedures from the Code of Federal Regulations
as obsolete.
DATES: This rule is effective August 2, 2021.
FOR FURTHER INFORMATION CONTACT:
Vince Mareino (Legal Information), Office of the General Counsel,
888 First Street NE, Washington, DC 20426, (202) 502-6167,
[email protected].
Laura Kane (Technical Information), Office of Energy Market
Regulation, 888 First Street NE, Washington, DC 20426, (202) 502-8653,
[email protected].
SUPPLEMENTARY INFORMATION:
I. Background
1. On July 18, 2018, the Commission issued a final rule \1\ (Order
No. 849) adopting procedures for determining which jurisdictional
natural gas pipelines may be collecting unjust and unreasonable rates
in light of the income tax reductions provided by the Tax Cuts and Jobs
Act \2\ and the Commission's Revised Policy
[[Page 29504]]
Statement \3\ and precedent \4\ concerning tax allowances to address
the double recovery issue identified by United Airlines, Inc. v.
FERC.\5\ These procedures also allowed interstate natural gas pipelines
to voluntarily reduce their rates. On April 18, 2019, the Commission
denied all outstanding requests for rehearing and reaffirmed the
Commission's determinations in Order No. 849 (Order No. 849-A).\6\
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\1\ Interstate & Intrastate Nat. Gas Pipelines; Rate Changes
Relating to Fed. Income Tax Rate, Order No. 849, 83 FR 36672 (July
30, 2018), 164 FERC ] 61,031 (2018).
\2\ An Act to provide for reconciliation pursuant to titles II
and V of the concurrent resolution on the budget for fiscal year
2018, Public Law 115-97, 131 Stat. 2054 (2017) (Tax Cuts and Jobs
Act).
\3\ Inquiry Regarding the Commission's Policy for Recovery of
Income Tax Costs, 81 FR 94366 (Dec. 23, 2016), 162 FERC ] 61,227
(Revised Policy Statement), order on reh'g, 83 FR 12362 (March 21,
2018), 164 FERC ] 61,030 (2018) (Revised Policy Statement
Rehearing).
\4\ SFPP, L.P., Opinion No. 511-C, 162 FERC ] 61,228, at P 9
(2018).
\5\ 827 F.3d 122 (D.C. Cir. 2016) (United Airlines). For
purposes of this order, the Revised Policy Statement, United
Airlines, and Opinion No. 511-C will collectively be referred to as
``United Airlines Issuances.''
\6\ Interstate & Intrastate Nat. Gas Pipelines; Rate Changes
Relating to Fed. Income Tax Rate, Order No. 849-A, 84 FR 17739
(April 26, 2019), 167 FERC ] 61,051 (2019).
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2. Order No. 849 established a requirement, pursuant to sections 10
and 14(a) of the Natural Gas Act (NGA),\7\ that all interstate natural
gas companies with cost-based stated rates that filed a 2017 FERC Form
No. 2 or 2-A must file the FERC Form No. 501-G informational filing for
the purpose of evaluating the impact of the Tax Cuts and Jobs Act and
the United Airlines Issuances on interstate natural gas pipelines'
revenue requirements. In addition to the FERC Form No. 501-G filing
requirement, the Commission provided four options for each interstate
natural gas pipeline to make a filing to address the changes to the
pipeline's recovery of tax costs or explain why no action is needed:
(1) A limited NGA section 4 \8\ rate reduction filing (Option 1), (2) a
commitment to file a general section 4 rate case or prepackaged
settlement in the near future (Option 2), (3) an explanation why no
rate change is needed (Option 3), and (4) no action (Option 4). These
procedures were intended to encourage natural gas pipelines to
voluntarily reduce their rates to the extent the tax changes result in
their over-recovering their cost of service, while also providing the
Commission and stakeholders information necessary to take targeted
actions under NGA section 5 \9\ where necessary to achieve just and
reasonable rates.
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\7\ 15 U.S.C. 717i(a), 717m(a).
\8\ 15 U.S.C. 717c.
\9\ 15 U.S.C. 717d.
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3. Order No. 849 made three changes to the Code of Federal
Regulations. First, new Sec. 260.402 of the Commission's regulations
established the FERC Form No. 501-G filing requirement described
above.\10\ Second, new Sec. 154.404 of the Commission's regulations
established the regulations necessary to govern Option 1, the limited
NGA section 4 rate reduction filings.\11\ Options 2, 3, and 4 above did
not require any change in regulations, as they could proceed under
preexisting regulatory authority. Third, new Sec. 284.123(i) of the
Commission's regulations provided procedures for section 311 of the
National Gas Policy Act of 1978 (NGPA) \12\ and Hinshaw \13\ pipelines
to establish fair and equitable rates for their interstate
services.\14\
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\10\ 18 CFR 260.402.
\11\ 18 CFR 154.404.
\12\ 15 U.S.C. 3371.
\13\ Section 1(c) of the NGA, 15 U.S.C. 717(c), exempts from the
Commission's NGA jurisdiction those pipelines which transport gas in
interstate commerce if: (1) They receive natural gas at or within
the boundary of a state, (2) all the gas is consumed within that
state, and (3) the pipeline is regulated by a state Commission. This
is known as the Hinshaw exemption.
\14\ 18 CFR 284.123(i).
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II. Discussion
4. In Order No. 849, the Commission identified 129 interstate
natural gas pipelines with cost-based rates that were required to file
the FERC Form No. 501-G, codified in Sec. 260.402. As of the date of
Order No. 849-A, the Commission had received filings from all 129
identified pipelines.\15\ As of April 15, 2021, all of these FERC Form
No. 501-G filings have been accepted for filing, and the proceedings
terminated. Because Order No. 849 established a one-time reporting
requirement tied to a past event, it would not apply to any new
pipelines that may enter the market in the future. Therefore, the
regulations implemented in Order No. 849 are no longer needed, and we
hereby remove Sec. 260.402 from the Commission's regulations.
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\15\ Order No. 849-A, 167 FERC ] 61,051 at P 4.
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5. Eleven pipelines chose Option 1, codified in Sec. 154.404.
Under Option 1, pipelines could only choose to make these limited NGA
section 4 rate reduction filings at the time of their FERC Form No.
501-G filings. Just as no new FERC Form No. 501-G filings are possible,
likewise no new filings under Sec. 154.404 are possible.
6. For any of these limited NGA section 4 rate reduction filings
that proceeded to hearing, Sec. 154.404 also governs the process by
which these hearings are adjudicated, so it would not have been
reasonable to remove Sec. 154.404 before all the existing hearings
concluded, either with the acceptance of a settlement or with the
publication of an Initial Decision. There are no remaining dockets that
are either in an Option 1 hearing or eligible to be set for an Option 1
hearing. As a result, the regulations governing this type of limited
NGA section 4 rate reduction filings are no longer needed. We shall
therefore remove Sec. 154.404 of the Commission's regulations.
7. Order No. 849 also established separate regulations under Sec.
284.123(i) to address the unique jurisdictional situation of section
311 and Hinshaw pipelines, which have their interstate rates regulated
by the Commission, but which are primarily regulated at the state
level. Under pre-existing policy, the Commission reviews the rates of
section 311 and Hinshaw pipelines every five years on a rolling
basis.\16\ Section 284.123(i), in brief, provided a mechanism to lower
these pipelines' interstate rates prior to their five-year review, in
the event that state government regulators also adjusted their rates in
light of the recent changes in tax code and tax policy. In the three-
and-a-half years from the passage of the Tax Cuts and Jobs Act in
November 2017 until the present, almost all section 311 and Hinshaw
pipelines have either come before the Commission for their five-year
review, or have come before the Commission for an out-of-cycle rate
review, whether due to Sec. 284.123(i), voluntary action, or the other
requirements of section 284 of the Commission's regulations that can
compel an out-of-cycle rate review. The Commission, through its own
review, finds it is unlikely that the remaining section 311 and Hinshaw
pipelines will trigger Sec. 284.123(i), and in any event all are due
for their five-year review in the near future under the Commission's
pre-existing policy. As a result, the special circumstances presented
by the Tax Cuts and Jobs Act that required Sec. 284.123(i) are no
longer present. We shall therefore remove Sec. 284.123(i) of the
Commission's regulations.
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\16\ Contract Reporting Requirements of Intrastate Nat. Gas
Cos., Order No. 735, 75 FR 29404 (May 26, 2010), 131 FERC ] 61,150,
at P 96, order on reh'g, Order No. 735-A, 75 FR 80685 (Dec. 23,
2010), 133 FERC ] 61,216 (2010); see also Hattiesburg Indus. Gas
Sales, L.L.C., 134 FERC ] 61,236 (2011) (imposing a five-year rate
review requirement on Hattiesburg Industrial Gas Sales, L.L.C.).
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III. Regulatory Requirements
A. Information Collection Statement
8. The Paperwork Reduction Act \17\ requires each Federal agency to
seek and obtain the Office of Management and Budget's (OMB) approval
before undertaking a collection of information (including reporting,
record keeping, and public disclosure requirements)
[[Page 29505]]
directed to ten or more persons or contained in a rule of general
applicability. OMB regulations require approval of certain information
collection requirements contemplated by final rules (including
deletion, revision, or implementation of new requirements). Upon
approval of a collection of information, OMB will assign an OMB control
number and an expiration date. Respondents subject to the filing
requirements of a rule will not be penalized for failing to respond to
the collection of information unless the collection of information
displays a valid OMB control number. The following discussion describes
and analyzes the collection of information to be deleted by this final
rule.
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\17\ 44 U.S.C. 3501-3521.
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9. Public Reporting Burden: In this final rule, the Commission
eliminates FERC Form No. 501-G \18\ (One-time Report on Rate Effect of
the Tax Cuts and Jobs Act). This final rule eliminates an existing data
collection, FERC-501G (OMB Control No. 1902-0302). Order No. 849 (in
Docket No. RM18-11-000) allowed the Commission to determine which
jurisdictional natural gas pipelines may be collecting unjust and
unreasonable rates in light of the recent reduction in the corporate
income tax rate in the Tax Cuts and Jobs Act and changes to the
Commission's income tax allowance policies following the United
Airlines decision. FERC Form No. 501-G collected information as to
whether the pipeline was a pass-through entity. FERC Form No. 501-G
collected income and balance sheet statement financial data from all
NGA pipelines that have stated cost-based rates on file with the
Commission. NGA pipelines whose rates were examined in a general rate
case under section 4 of the NGA or in an investigation under section 5
of the NGA were not required to file FERC Form No. 501-G.
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\18\ FERC-501G has also been referenced as FERC Form No. 501-G.
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10. The Commission identified 129 interstate natural gas pipelines
with cost-based rates that were required to file the adopted FERC Form
No. 501-G. Interstate natural gas pipelines had four options as to how
to address the results of the formula contained in the FERC Form No.
501-G. Each option has a different burden profile and a different cost
per response. Companies made their own business decisions as to which
option they selected. This final rule eliminates FERC Form No. 501-G
which reduces burden on all applicants.
11. All burden from FERC Form No. 501-G has already been incurred.
For informational purposes, the previous estimate of burden and cost
for the now-complete FERC Form No. 501-G collection follows.
FERC-501G--Rate Changes Relating to Federal Corporate Income Tax Rate for Interstate Natural Gas Pipelines, To Be Eliminated by the Final Rule in Docket
No. RM18-11-002
--------------------------------------------------------------------------------------------------------------------------------------------------------
Average burden
Respondents Responses per Total hour per Average cost Total burden Total cost ($)
respondent responses response per response hours
(1) (2) (1) * (2) = (4) (5) (1) * (4) = (1) * (5) =
(3) (6) (7)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Interstate Natural Gas Pipelines With Cost-Based Rates
--------------------------------------------------------------------------------------------------------------------------------------------------------
FERC Form No. 501-G, One-time Report 129 1 * 129 * 9 hrs. * $756 * 1,161 * $97,524
(reduction) 19.........................
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Optional Response
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No Response (reduction)................. 51 0 0 0 0 0 0
Case for no change (reduction).......... 62 1 62 5 420 310 26,040
Limited Sec 4 filing (reduction) 20..... 15 1 15 6 504 90 7,560
General Sec. 4 filing (reduction) 21.... 1 1 1 22 512 42,968 512 42,968
--------------------------------------------------------------------------------------------------------------------------------------------------------
NGPA Section 311 and Hinshaw Pipelines With Cost-Based Rates
--------------------------------------------------------------------------------------------------------------------------------------------------------
NGPA rate filing (reduction) 23......... 24 15 1 15 24 2,015 360 30,225
---------------------------------------------------------------------------------------------------------------
Total, To Be Eliminated by RM18-11- 25 144 .............. * 222 .............. .............. * 2,433 * 204,317
002................................
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* (reduction).
12. This final rule eliminates all information collection and
recordkeeping requirements associated with RM18-11-000. The removal of
the FERC-501G eliminates the estimated annual information collection
burden (2,433 hours) and cost ($204,317) associated with FERC-501G (OMB
Control No. 1902-0302).
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\19\ 18 CFR 260.402 (as revised).
\20\ 18 CFR 154.404 (as revised).
\21\ 18 CFR 154.312.
\22\ The estimate for hours is based on the estimated average
hours per response for the FERC-545 (OMB Control No. 1902-0154),
with general NGA section 4, 18 CFR 154.312 filings weighted at a
ratio of 20 to one.
\23\ 18 CFR 284.123(i) (as revised).
\24\ Estimate of number of respondents assumes that states will
act within one year to reduce NGPA section 311 and Hinshaw pipeline
rates to reflect the Tax Cuts and Jobs Act.
\25\ Number of unique respondents = (One-time Report) + (NGPA
rate filing).
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B. Environmental Analysis
13. The Commission is required to prepare an Environmental
Assessment or an Environmental Impact Statement
[[Page 29506]]
for any action that may have a significant adverse effect on the human
environment.\26\ The actions taken here fall within categorical
exclusions in the Commission's regulations for rules regarding
information gathering, analysis, and dissemination.\27\ Therefore, an
environmental review is unnecessary and has not been prepared in this
rulemaking.
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\26\ Regulations Implementing the National Environmental Policy
Act of 1969, Order No. 486, 52 FR 47897 (Dec. 17, 1987), FERC Stats.
& Regs. ] 30,783 (1987) (cross-referenced at 41 FERC ] 61,284).
\27\ See 18 CFR 380.4(a)(2)(ii) and (a)(5).
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C. Regulatory Flexibility Act
14. The Regulatory Flexibility Act of 1980 (RFA) \28\ generally
requires a description and analysis of final rules that will have
significant economic impact on a substantial number of small entities.
The RFA mandates consideration of regulatory alternatives that
accomplish the stated objectives of a rulemaking while minimizing any
significant economic impact on a substantial number of small entities.
In lieu of preparing a regulatory flexibility analysis, an agency may
certify that a final rule will not have a significant economic impact
on a substantial number of small entities.\29\ In Order No. 849, the
Commission found that the institution of the new regulations would not
have a significant impact on a substantial number of small
entities.\30\ Most of the natural gas pipelines regulated by the
Commission do not fall within the RFA's definition of a small
entity.\31\ For the same reasons, removing these regulations will not
have a significant impact on a substantial number of small entities.
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\28\ 5 U.S.C. 601-612.
\29\ 5 U.S.C. 605(b).
\30\ Order No. 849, 164 FERC ] 61,031 at P 296.
\31\ In Order No. 849, the Commission determined 3.9% of the
total potential NGA respondents and 5.1% of the total NGPA section
311 and Hinshaw pipelines could be considered a small entity.
Eliminating the filing requirement would eliminate any burden and
cost from FERC-501G for small and large entities.
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D. Document Availability
15. In addition to publishing the full text of this document in the
Federal Register, the Commission provides all interested persons an
opportunity to view and/or print the contents of this document via the
internet through the Commission's Home Page (https://www.ferc.gov). At
this time, the Commission has suspended access to the Commission's
Public Reference Room due to the President's March 13, 2020
proclamation declaring a National Emergency concerning the Novel
Coronavirus Disease (COVID-19).
16. From the Commission's Home Page on the internet, this
information is available on eLibrary. The full text of this document is
available on eLibrary in PDF and Microsoft Word format for viewing,
printing, and/or downloading. To access this document in eLibrary, type
the docket number excluding the last three digits of this document in
the docket number field.
17. User assistance is available for eLibrary and the Commission's
website during normal business hours from FERC Online Support at 202-
502-6652 (toll free at 1-866-208-3676) or email at
[email protected], or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at
[email protected].
E. Effective Date and Congressional Notification
18. These regulations are effective August 2, 2021. This rule does
not alter the substantive rights or interests of any interested
persons, and it merely removes certain outdated and nonessential
natural gas regulations from the Commission's body of regulations on a
prospective basis. Therefore, prior notice and comment under section 4
of the Administrative Procedure Act (APA) \32\ are unnecessary. The
Commission has determined that this rule is not a ``major rule'' as
defined in section 351 of the Small Business Regulatory Enforcement
Fairness Act of 1996.
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\32\ 5 U.S.C. 553(b).
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List of Subjects
18 CFR Part 154
Natural gas, Pipelines, Reporting and recordkeeping requirements.
18 CFR Part 260
Natural gas, Reporting and recordkeeping requirements.
18 CFR Part 284
Continental shelf, Natural gas, Reporting and recordkeeping
requirements.
By the Commission.
Issued: May 20, 2021.
Kimberly D. Bose,
Secretary.
In consideration of the foregoing, the Commission amends parts 154,
260, & 284, chapter I, title 18, Code of Federal Regulations, as
follows:
PART 154--RATE SCHEDULES AND TARIFFS
0
1. The authority citation for part 154 continues to read as follows:
Authority: 15 U.S.C. 717-717w; 31 U.S.C. 9701; 42 U.S.C. 7102-
7352.
Sec. 154.404 [Removed]
0
2. Remove Sec. 154.404.
PART 260--STATEMENTS AND REPORTS (SCHEDULES)
0
3. The authority citation for part 260 continues to read as follows:
Authority: 15 U.S.C. 717-717w, 3301-3432; 42 U.S.C. 7101-7352.
Sec. 260.402 [Removed]
0
4. Remove Sec. 260.402.
PART 284--CERTAIN SALES AND TRANSPORTATION OF NATURAL GAS UNDER THE
NATURAL GAS POLICY ACT OF 1978 AND RELATED AUTHORITIES
0
5. The authority citation for part 284 continues to read as follows:
Authority: 15 U.S.C. 717-717z, 3301-3432; 42 U.S.C. 7101-7352;
43 U.S.C. 1331-1356.
Sec. 284.123 [Amended]
0
6. In Sec. 284.123, remove paragraph (i).
[FR Doc. 2021-11353 Filed 6-1-21; 8:45 am]
BILLING CODE 6717-01-P
