
[Federal Register Volume 75, Number 246 (Thursday, December 23, 2010)]
[Proposed Rules]
[Pages 80758-80761]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-32109]


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

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 284

[Docket No. RM11-4-000]


Storage Reporting Requirements of Interstate and Intrastate 
Natural Gas Companies

December 16, 2010.
AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Notice of inquiry.

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

SUMMARY: The Federal Energy Regulatory Commission is considering 
whether to revise regulations requiring interstate and intrastate 
natural gas pipelines to report semi-annually on their storage 
activities. This Notice of Inquiry will assist the Commission in 
determining what changes, if any, should be made to its regulations.

DATES: Comment Date: Comments are due February 22, 2011.

ADDRESSES: You may submit comments on the Notice of Inquiry, identified 
by Docket No. RM11-4-000, by one of the following methods:
     Agency Web Site: Documents created electronically using 
word processing software should be filed in native applications or 
print-to-PDF format, and not in a scanned format, at http://www.ferc.gov/docs-filing/efiling.asp.
     Mail/Hand Delivery: Commenters unable to file comments 
electronically must mail or hand deliver an original copy of their 
comments to: Federal Energy Regulatory Commission, Secretary of the 
Commission, 888 First Street, NE., Washington, DC 20426. These 
requirements can be found on the Commission's Web site; see, e.g., the 
``Quick Reference Guide for Paper Submissions,'' available at http://www.ferc.gov/docs-filing/efiling.asp or via phone from FERC Online 
Support at 202-502-6652 or toll-free at 1-866-208-3676.

FOR FURTHER INFORMATION CONTACT:

Vince Mareino (Legal Information), Office of the General Counsel, 
Federal Energy Regulatory Commission, 888 First Street, NE., 
Washington, DC 20426, (202) 502-6167, Vince.Mareino@ferc.gov.

Kenneth Kohut (Technical Information), Office of Enforcement, Federal 
Energy Regulatory Commission, 888 First Street, NE., Washington, DC 
20426, (202) 502-6342, Kenneth.Kohut@ferc.gov.

Thomas Russo (Technical Information), Office of Enforcement, Federal 
Energy Regulatory Commission, 888 First Street, NE., Washington, DC 
20426, (202) 502-8792, Thomas.Russo@ferc.gov.

SUPPLEMENTARY INFORMATION:

Notice of Inquiry

December 16, 2010.
    1. In this Notice of Inquiry, the Federal Energy Regulatory 
Commission (Commission) seeks comments on whether the Commission should 
modify the semi-annual storage reports required of interstate and 
intrastate natural gas companies pursuant to 18 CFR 284.13(e) and 
284.126(c) of the Commission's regulations.\1\ In particular, the 
Commission is interested in exploring whether it should modify the 
information currently collected in the semi-annual storage reports, 
whether there should be a standardized electronic format for the 
reports, and whether the storage reports must be public.
---------------------------------------------------------------------------

    \1\ The FERC Form No. 549B reporting requirements in 18 CFR 
284.13(e) are approved by the Office of Management and Budget (OMB) 
under OMB Control No. 1902-0169. The Form No. 549 reporting 
requirements in 18 CFR 284.126(c) are approved under OMB Control No. 
1902-0089.
---------------------------------------------------------------------------

I. Background

    2. Section 284.13(e) of the Commission's regulations requires 
interstate pipelines to file semi-annual storage reports at the end of 
each complete storage injection and withdrawal season. Section 
284.126(c) requires similar reports by (1) intrastate natural gas 
pipelines providing interstate transportation service pursuant to 
section 311 of the Natural Gas Policy Act of 1978 (NGPA) \2\ and (2) 
Hinshaw pipelines providing interstate service subject to the 
Commission's Natural Gas Act (NGA) section 1(c) jurisdiction pursuant 
to blanket certificates issued under 18 CFR 284.224.\3\ The reports by 
both sets of pipelines must include:
---------------------------------------------------------------------------

    \2\ 15 U.S.C. 3372.
    \3\ Section 1(c) of the NGA 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 exemption is 
referred to as the Hinshaw exemption after the Congressman who 
introduced the bill amending the NGA to include section 1(c). See 
ANR Pipeline Co. v. Federal Energy Regulatory Comm'n, 71 F.3d 897, 
898 (1995) (briefly summarizing the history of the Hinshaw 
exemption).

    (1) The identity of each customer injecting gas into storage 
and/or withdrawing gas from storage (including, for interstate 
pipelines, any affiliate relationship),
    (2) the rate schedule (for interstate pipelines) or docket 
number (for intrastate pipelines) authorizing the storage injection 
or withdrawal service,
    (3) the maximum storage quantity and maximum daily withdrawal 
quantity applicable to each storage customer,
    (4) for each storage customer, the volume of gas (in dekatherms) 
injected into and/or withdrawn from storage during the period,
    (5) the unit charge and total revenues received during the 
injection/withdrawal period from each storage customer (including, 
for interstate pipelines, any discounts), and
    (6) for intrastate pipelines, any related docket numbers under 
which the intrastate pipeline reported storage related injection/
withdrawal transportation services.

The pipelines must file these reports within 30 days of the end of each 
complete storage injection and withdrawal season, and the reports must 
be signed under oath by a senior official. The Commission has not 
adopted any standardized electronic form for pipelines to submit the 
semi-annual storage reports. Nor has the Commission expressly required 
that the reports be public.
    3. The Commission adopted the existing semi-annual storage 
reporting requirements for both interstate and intrastate pipelines in 
their current form in 1992 as part of Order No. 636,\4\ and there have 
been only minor modifications in the semi-annual storage reporting 
requirements since

[[Page 80759]]

that date.\5\ In Order No. 637,\6\ the Commission revised the reporting 
requirements for interstate pipelines in order to require them to post 
on their internet Web sites basic information on the terms of each 
transportation and storage contract with individual shippers, no later 
than the first nomination under a transaction.\7\ These posting 
requirements are set forth in section 284.13(b) of the Commission's 
regulations.\8\ However, Order No. 637 did not modify the semi-annual 
storage reporting requirement for either interstate pipelines or 
section 311 and Hinshaw pipelines.
---------------------------------------------------------------------------

    \4\ Pipeline Service Obligations and Revisions to Regulations 
Governing Self-Implementing Transportation; and Regulation of 
Natural Gas Pipelines After Partial Wellhead Decontrol, Order No. 
636, FERC Stats. & Regs. ] 30,939, order on reh'g, Order No. 636-A, 
FERC Stats. & Regs. ] 30,950, order on reh'g, Order No. 636-B, 61 
FERC ] 61,272 (1992), order on reh'g, 62 FERC ] 61,007 (1993), aff'd 
in part and remanded in part sub nom. United Distribution Cos. v. 
FERC, 88 F.3d 1105 (DC Cir. 1996), order on remand, Order No. 636-C, 
78 FERC ] 61,186 (1997).
    \5\ In 1995 in Order No. 581, the Commission held that it would 
``retain the semi-annual storage reports,'' and ``not exempt 
intrastate storage companies charging market-based rates from the 
requirement to file semi-annual storage reports,'' and made minor 
changes to the regulatory text. Revisions to Uniform System of 
Accounts, Forms, Statements, and Reporting Requirements for Natural 
Gas Companies, Order No. 581, 60 FR 53019, 53049-51, FERC Stats. & 
Regs. ] 31,026 (1995), order on reh'g, Order No. 581-A, FERC Stats. 
& Regs. ] 31,032 (1996).
    \6\ Regulation of Short-Term Natural Gas Transportation Services 
and Regulation of Interstate Natural Gas Transportation Services, 
Order No. 637, FERC Stats. & Regs. ] 31,091, clarified, Order No. 
637-A, FERC Stats. & Regs. ] 31,099, reh'g denied, Order No. 637-B, 
92 FERC ] 61,062 (2000), aff'd in part and remanded in part sub nom. 
Interstate Natural Gas Ass'n of America v. FERC, 285 F.3d 18 (DC 
Cir. 2002), order on remand, 101 FERC ] 61,127 (2002), order on 
reh'g, 106 FERC ] 61,088 (2004), aff'd sub nom. American Gas Ass'n 
v. FERC, 428 F.3d 255 (DC Cir. 2005).
    \7\ The information to be posted includes the name of the 
shipper, the contract number (for firm service), the rate charged, 
the maximum rate, the duration (for firm service), the receipt and 
delivery points and zones covered, the quantity of natural gas 
covered, any special terms or details (such as any deviations from 
the tariff), and whether any affiliate relationship exists.
    \8\ 18 CFR 284.13(b).
---------------------------------------------------------------------------

    4. In recent years, the Commission has updated almost all of its 
other reporting requirements to clarify their public status, 
standardize the filing format, and streamline the process of publishing 
the reported data to the general public. For example, in Order No. 
2001,\9\ the Commission amended its filing requirements for public 
utilities under the Federal Power Act (FPA) to require them to file 
Electric Quarterly Reports (EQR) summarizing the contractual terms and 
conditions in their contracts for all jurisdictional services during 
the most recent calendar quarter. The EQRs include information similar 
to that required by the semi-annual storage reports, including the 
quantities of service provided and the rates charged for all sales 
under the reported contracts. Order No. 2001 required that the EQRs be 
filed in a standardized electronic format and that they be public.\10\ 
In Order No. 710,\11\ the Commission revised the Commission's financial 
reporting requirements for natural gas pipelines, FERC Form Nos. 2, 2-
A, and 3-Q, also adopting standardized electronic forms for the filing 
of these reports and requiring them to be public. Similarly, new forms, 
such as Form No. 552 issued pursuant to the transparency provisions of 
section 23 of the Natural Gas Act, have likewise emphasized 
standardization and transparency.\12\
---------------------------------------------------------------------------

    \9\ Revised Public Utility Filing Requirements, Order No. 2001, 
FERC Stats. & Regs. ] 31,127, reh'g denied, Order No. 2001-A, 100 
FERC ] 61,074, reh'g denied, Order No. 2001-B, 100 FERC ] 61,342, 
order directing filing, Order No. 2001-C, 101 FERC ] 61,314 (2002), 
order directing filing, Order No. 2001-D, 102 FERC ] 61,334, order 
refining filing requirements, Order No. 2001-E, 105 FERC ] 61,352 
(2003), order on clarification, Order No. 2001-F, 106 FERC ] 61,060 
(2004), order revising filing requirements, Order No. 2001-G, 120 
FERC ] 61,270, order on reh'g and clarification, Order No. 2001-H, 
121 FERC ] 61,289 (2007), order revising filing requirements, Order 
No. 2001-I, 125 FERC ] 61,103 (2008).
    \10\ Order No. 2001, FERC Stats. & Regs. ] 31,127 at P 44-46, 
74-85, 104-117, reh'g denied, Order No. 2001-A, 100 FERC ] 61,074 at 
P 13-17, 30-35.
    \11\ Revisions to Forms, Statements, and Reporting Requirements 
for Natural Gas Pipelines, Order No. 710, 73 FR 19389, FERC Stats. & 
Regs. ] 31,267 (2008), reh'g and clarification, Order No. 710-A, 123 
FERC ] 61,278 (2008).
    \12\ See Transparency Provisions of Section 23 of the Natural 
Gas Act, Order No. 704, 73 FR 1014, FERC Stats. & Regs. ] 31,260 
(2007), order on reh'g, Order No. 704-A, 73 FR 55726, FERC Stats. & 
Regs. ] 31,275 (2008), order on reh'g, Order No. 704-B, 125 FERC ] 
61,302 (2008), order on reh'g, Order No. 704-C, 75 FR 35632, 131 
FERC ] 61,246 (2010).
---------------------------------------------------------------------------

    5. Most relevant to this proceeding, on May 20, 2010, the 
Commission issued Order No. 735 to bring the less stringent 
transactional reporting requirements for NGPA section 311 intrastate 
pipelines and Hinshaw pipelines closer in line with the 18 CFR 
284.13(b) posting requirements for interstate pipelines.\13\ As part of 
that proceeding, the Commission revised the former annual 
transportation report at 18 CFR 284.126(b) to cover storage as well. 
Order No. 735 requires that section 311 and Hinshaw pipelines file 
quarterly reports in a standardized electronic format, and requires 
that those reports be public. As revised in a contemporaneous order on 
rehearing, the new quarterly reports must contain the following 
information on each transportation and storage transaction, aggregated 
by contract:
---------------------------------------------------------------------------

    \13\ Contract Reporting Requirements of Intrastate Natural Gas 
Companies, Order No. 735, 75 FR 29404, FERC Stats. & Regs. ] 31,310, 
131 FERC ] 61,150 (2010), order on reh'g, Order No. 735-A, Docket 
No. RM09-2-001 (Dec. 16, 2010).

    i. The full legal name, and identification number, of the 
shipper receiving the service, including whether there is an 
affiliate relationship between the pipeline and the shipper;
    ii. The type of service performed (i.e., firm or interruptible 
transportation, storage, or other service);
    iii. The rate charged under each contract, specifying the rate 
schedule/name of service and docket where the rates were approved. 
The report should separately state each rate component set forth in 
the contract (i.e., reservation, usage, and any other charges);
    iv. The primary receipt and delivery points covered by the 
contract, identified by the list of points that the pipeline has 
published with the Commission, which shall include the industry 
common code for each point where one has already been established;
    v. The quantity of natural gas the shipper is entitled to 
transport, store, or deliver under each contract;
    vi. The duration of the contract, specifying the beginning and 
(for firm contracts only) ending month and year of the current 
agreement;
    vii. Total volumes transported, stored, injected, or withdrawn 
for the shipper; and
    viii. Annual revenues received for each shipper, excluding 
revenues from storage services. The report should separately state 
revenues received under each component, and need only be reported 
every fourth quarter.

    6. Order No. 735 did not modify the existing semi-annual storage 
reporting requirement for section 311 and Hinshaw pipelines in section 
284.126(c) of the Commission's regulations in any way. That semi-annual 
storage report collects certain information that the new quarterly 
reports do not. This includes (1) the volumes actually injected and 
withdrawn from storage during the injection and withdrawal seasons and 
(2) revenues collected from each customer. Moreover, because the semi-
annual reporting periods are tied to the injection and withdrawal 
season, the time periods covered by each report do not correspond 
precisely. Similarly, the 18 CFR 284.13(b) posting requirements for 
interstate pipelines do not collect this information.

II. Discussion

    7. The Commission is issuing this Notice of Inquiry to consider 
whether and how the semi-annual storage reports required of both 
interstate and intrastate pipelines should be modified in light of (1) 
changes in the natural gas market since the Commission originally 
adopted the semi-annual storage reporting requirements and (2) recent 
improvements in the Commission's other reporting requirements.
    8. Both the evolution of natural gas markets, and the Commission's 
experience in improving the usefulness and accessibility of other 
informational reports filed by natural gas pipelines and public 
utilities, warrant a review of the continued usefulness of the semi-
annual storage reports in their current

[[Page 80760]]

format. The semi-annual storage reports are now the only significant 
report required of regulated entities for which the Commission has not 
established a standardized electronic format and required to be public. 
As a result, many respondents file these reports subject to requests 
for confidential treatment, and/or file the data in a format that is 
not conducive to automated data review and posting on the Commission's 
Web site for public review. The Commission has often had to rely on 
exhaustive data requests in individual rate filings in order to fulfill 
its oversight duty, a method that is administratively burdensome to the 
pipelines and the Commission. Perhaps more importantly, significant 
information in the reports is either not available to the public at all 
or, if available, is difficult to analyze because of the different 
reporting formats.
    9. Further, improved storage technology and the increased use of 
natural gas in industry and electric generation have helped transform 
the storage market since 1992. There has been a sharp increase in 
demand for natural gas outside of the traditional winter months. 
Withdrawals and injections, instead of occurring on a uniform annual 
schedule based on heating needs, now occur dynamically year-round in 
response to market forces.
    10. Also, on rehearing of Order No. 735, several parties argued 
that, because the new quarterly transportation reports for section 311 
and Hinshaw pipelines will include storage transactions, Order No. 735 
has made the existing 18 CFR 284.126(c) semi-annual storage reporting 
requirement for those pipelines duplicative and therefore the semi-
annual storage report should be eliminated. However, while there is 
significant overlap between the two reports, as described above the 
semi-annual storage reports for section 311 and Hinshaw pipelines still 
require the reporting of certain information not included in the new 
quarterly transportation report, including volumes injected and 
withdrawn from storage during each injection and withdrawal season and 
per-customer storage revenues. The 18 CFR 284.13(e) semi-annual storage 
reports by interstate pipelines are also the only place where 
interstate pipelines report this information.
    11. Accordingly, the Commission requests comment on the following 
questions concerning the semi-annual storage reports by both interstate 
pipelines and by section 311 and Hinshaw pipelines.
    (1) Should the Commission require that the semi-annual storage 
reports be public? In recent years, the Commission has clarified that 
Form Nos. 2, 2a, 3Q, 552, and other similar reports must be filed 
publicly with no provision for redacting data. The EQR, which Order No. 
2001 requires to be public, contain reporting requirements quite 
similar to the semi-annual storage reports. In the contemporaneous 
order on rehearing of Order No. 735, the Commission affirmed that the 
new quarterly transportation reports by section 311 and Hinshaw 
pipelines will be public as well. Is there any reason why the natural 
gas storage reports by interstate and intrastate pipelines should not 
be made public?
    (2) Should the natural gas storage reporting requirements be 
standardized into an electronic form with standard fields and 
definitions?
    (3) Storage injections and withdrawals are no longer done 
exclusively on a seasonal basis, but occur dynamically year-round. 
Should any reporting on storage be filed on a quarterly schedule, 
instead of semi-annually by injection and withdrawal season?
    (4) If a standardized electronic form is developed for storage 
reports by interstate pipelines, what data elements from the Data 
Dictionary for the new quarterly transportation reports for section 311 
and Hinshaw pipelines should be used in the revised interstate pipeline 
storage reports? What additional data elements should be included?
    (5) Should the Commission require that interstate and section 311 
and Hinshaw pipelines must report the different rate components in each 
storage customer's contracts separately? What data elements should be 
included?
    (6) In Order No. 735-A, the Commission removed from the new 
quarterly transportation report the requirement that section 311 and 
Hinshaw pipelines report revenues received from each storage customer, 
partly on the grounds that the semi-annual storage reports require 
reporting such information. Should this reporting requirement be 
retained for interstate and intrastate storage companies? Is the 
revenue information primarily of use in the rate cases of cost-based 
rate storage providers, so that revenues need not be reported by 
market-based storage providers?
    (7) Given the extensive overlap between the new quarterly Form No. 
549D reports \14\ and the current requirements of the intrastate semi-
annual storage reports, should the intrastate storage reporting 
requirements be folded into Form No. 549D, or kept as a separate form?
---------------------------------------------------------------------------

    \14\ The information collection requirements included in 
Commission Order No. 735 for Form No. 549D were approved under OMB 
Control No. 1902-0253. The proposed revisions in the order on 
rehearing in Docket No. RM09-2-001 are being submitted to OMB for 
review and approval under the Paperwork Reduction Act.
---------------------------------------------------------------------------

III. Comment Procedures

    12. The Commission invites interested persons to submit comments 
and other information on the matters, issues, and specific questions 
identified in this notice. Comments are due February 22, 2011. Comments 
must refer to Docket No. RM11-4-000, and must include the commenter's 
name, the organization it represents, if applicable, and its address.
    13. To facilitate the Commission's review of the comments, 
commenters are requested to provide an executive summary of their 
position. Commenters are requested to identify each specific question 
posed by the Notice of Inquiry that their discussion addresses and to 
use appropriate headings. Additional issues the commenters wish to 
raise should be identified separately. The commenters should double-
space their comments.
    14. Comments may be filed electronically via the eFiling link on 
the Commission's Web site at http://www.ferc.gov or on paper. The 
Commission accepts most standard word processing formats and commenters 
may attach additional files with supporting information in certain 
other file formats (as detailed at http://www.ferc.gov/help/submission-guide.asp). Commenters filing electronically do not need to make a 
paper filing.
    15. Commenters unable to file comments electronically must mail or 
hand deliver an original copy of their comments to: Federal Energy 
Regulatory Commission, Secretary of the Commission, 888 First Street, 
NE., Washington, DC 20426.
    16. All comments will be placed in the Commission's public files 
and may be viewed, printed, or downloaded remotely as described in the 
Document Availability section below. Commenters are not required to 
serve copies of their comments on other commenters.

IV. Document Availability

    17. 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 (http://www.ferc.gov) and 
in the Commission's Public Reference Room during normal business hours 
(8:30 a.m. to 5 p.m. Eastern time) at 888 First Street, NE., Room 2A, 
Washington, DC 20426.

[[Page 80761]]

    18. From the Commission's Home Page on the Internet, this 
information is available in the Commission's document management 
system, 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) in the docket number field.
    19. User assistance is available for eLibrary and the Commission's 
Web site during normal business hours. For assistance, please contact 
the Commission's Online Support at 1-866-208-3676 (toll free) or (202) 
502-6652 (e-mail at FERCOnlineSupport@ferc.gov or the Public Reference 
Room at (202) 502-8371, TTY (202) 502-8659 (e-mail at 
public.referenceroom@ferc.gov).

    By direction of the Commission.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2010-32109 Filed 12-22-10; 8:45 am]
BILLING CODE 6717-01-P


