
[Federal Register Volume 75, Number 246 (Thursday, December 23, 2010)]
[Rules and Regulations]
[Pages 80685-80697]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-32112]



[[Page 80685]]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 284

[Docket No. RM09-2-001; Order No. 735-A]


Contract Reporting Requirements of Intrastate Natural Gas 
Companies

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

ACTION: Order on rehearing.

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SUMMARY: In this Order on Rehearing, the Commission addresses pending 
requests to reconsider or clarify Order No. 735, in which it reformed 
its reporting requirements and instituted Form No. 549D--Quarterly 
Transportation and Storage Report for Intrastate Natural Gas and 
Hinshaw Pipelines. Order No. 735-A generally reaffirms the Final Rule. 
It also retracts the increased requirements for contract end dates and 
per-customer revenue, extends the filing deadlines from 30 days to 60 
days after each reporting quarter, and offers clarification on several 
matters. Simultaneously with this order, the Commission is issuing a 
Notice of Inquiry under a separate docket to explore reforms to the 
semi-annual storage reporting requirements for interstate and 
intrastate storage companies.

DATES: Effective Date:
    The revisions made in this Order on Rehearing are effective April 
1, 2011.

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.
    James Sarikas (Technical Information), Office of Energy Markets 
Regulation, Federal Energy Regulatory Commission, 888 First Street, 
NE., Washington, DC 20426, (202) 502-6831, James.Sarikas@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:

Table of Contents

 
                                                               Paragraph
                                                                  No.
 
I. Background...............................................          3.
II. Discussion..............................................         15.
    A. Changes to the Quarterly Reporting Requirement.......         17.
        1. Interruptible Contract End-Dates.................         17.
        2. Customer Revenues................................         20.
        3. Quarterly Reporting Deadlines....................         24.
    B. Justification for Increased Transparency Required by          26.
     the Rule...............................................
        1. Statutory Authority To Require Public Disclosure.         31.
        2. Harm to Storage Providers With Market-Based Rates         39.
        3. Evidence.........................................         48.
        4. Insufficiency of Periodic Rate Review............         58.
        5. Burden...........................................         61.
    C. Identification of Receipt Points.....................         64.
    D. Identification of Shippers...........................         67.
    E. Prior Period Adjustment and Inactive Contracts.......         70.
    F. Semi-Annual Storage Report...........................         74.
    G. Effective Date and Technical Workshop................         77.
III. Information Collection Statement.......................         79.
IV. Environmental Analysis..................................         82.
V. Regulatory Flexibility Act...............................         83.
VI. Document Availability...................................         84.
VII. Effective Date.........................................         87.
 


Before Commissioners: Jon Wellinghoff, Chairman; Marc Spitzer, Philip 
D. Moeller, John R. Norris, and Cheryl A. LaFleur.

Order on Rehearing

    1. On May 20, 2010, the Commission issued Order No. 735,\1\ 
revising the contract reporting requirements for (1) intrastate natural 
gas pipelines \2\ providing interstate transportation service pursuant 
to pursuant to section 311 of the Natural Gas Policy Act of 1978 (NGPA) 
\3\ 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 Sec.  284.224 of the 
Commission's regulations.\4\ Order No. 735 sought to bring the less 
stringent transactional reporting requirements for section 311 and 
Hinshaw pipelines closer in line with the reporting requirements for 
interstate pipelines, without imposing unduly burdensome requirements 
on the pipelines. Specifically, Order No. 735 revised Sec.  284.126(b) 
of the Commission's regulations and replaced Form No. 549--Intrastate 
Pipeline Annual Transportation Report with the new Form No. 549D, so as 
to (1) increase the reporting frequency from annual to quarterly, (2) 
include certain additional types of information and cover storage 
transactions as well as transportation transactions,\5\ (3) establish a 
procedure for Form No. 549D

[[Page 80686]]

to be filed in a uniform electronic format and posted on the 
Commission's web site, and (4) hold that those reports must be public 
and may not be filed with information redacted as privileged. Order No. 
735 also modified Commission policy concerning periodic reviews of the 
rates charged by section 311 and Hinshaw pipelines to extend the cycle 
for such reviews from 3 years to 5 years.
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    \1\ Contract Reporting Requirements of Intrastate Natural Gas 
Companies, Order No. 735, 75 FR 29404, FERC Stats. & Regs. ] 31,310 
(2010) (Order No. 735 or Final Rule).
    \2\ Under section 2(16) of the NGPA, 15 U.S.C. 3301(16), the 
term ``intrastate pipeline'' may refer to all entities engaged in 
natural gas transportation under section 311 of the NGPA or section 
1(c) of the NGA. For consistency, this Final Rule will also use the 
terms ``transportation,'' ``pipeline,'' and ``shippers'' to refer 
inclusively to storage activity (except where noted).
    \3\ 15 U.S.C. 3372.
    \4\ 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).
    \5\ This Final Rule does not eliminate or revise 18 CFR 
284.126(c) and the corresponding Form No. 537, which require a semi-
annual storage report.
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    2. In this order, the Commission addresses requests for rehearing 
or clarification of Order No. 735. Five requests for rehearing or 
clarification of Order No. 735 were timely filed, by Arkansas Oklahoma 
Gas Corporation (AOG), Enstor Operating Company, LLC (Enstor), Enogex 
LLC (Enogex), Jefferson Island Storage & Hub, L.L.C. (Jefferson), and 
the Texas Pipeline Association (TPA). As discussed below, we largely 
affirm Order No. 735, granting a limited number of rehearing requests 
and clarifying the order.\6\
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    \6\ The Appendix to this order includes a static PDF version of 
the draft revised Form No. 549D. The Appendix will not be included 
in the Federal Register, but is available on the Commission's 
eLibrary site. The draft revised form is being submitted to the 
Office of Management and Budget (OMB) for review and approval.
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I. Background

    3. NGPA section 311 authorizes the Commission to allow intrastate 
pipelines to transport natural gas ``on behalf of'' interstate 
pipelines or local distribution companies served by interstate 
pipelines ``under such terms and conditions as the Commission may 
prescribe.'' \7\ NGPA section 601(a)(2) exempts transportation service 
authorized under NGPA section 311 from the Commission's NGA 
jurisdiction. Congress adopted these provisions in order to eliminate 
the regulatory barriers between the intrastate and interstate markets 
and to promote the entry of intrastate pipelines into the interstate 
market. After the adoption of the NGPA, the Commission authorized 
Hinshaw pipelines to apply for NGA section 7 certificates, authorizing 
them to transport natural gas in interstate commerce in the same manner 
as intrastate pipelines may do under NGPA section 311.\8\
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    \7\ 15 U.S.C. 3371(c).
    \8\ Certain Transportation, Sales, and Assignments by Pipeline 
Companies not Subject to Commission Jurisdiction Under Section 1(c) 
of the Natural Gas Act, Order No. 63, FERC Stats. & Regs. ] 30,118, 
at 30,824-25 (1980).
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    4. Subpart C of the Commission's Part 284 open access regulations 
(18 CFR 284.121-126) implements the provisions of NGPA section 311 
concerning transportation by intrastate pipelines. Those regulations 
require that intrastate pipelines performing interstate service under 
NGPA section 311 must do so on an open access basis.\9\ However, as 
described in Order No. 735, the Commission has not imposed on 
intrastate pipelines all of the Part 284 open access transportation 
requirements imposed on interstate pipelines, consistent with the 
NGPA's goal of encouraging intrastate pipelines to provide interstate 
service.\10\ Thus, the Commission does not require intrastate pipelines 
to offer firm open access service, or comply with the requirements of 
Order No. 636, such as capacity release and flexible receipt and 
delivery points.\11\ Section 284.224 of the Commission's regulations 
provides for the issuance of blanket certificates to Hinshaw pipelines 
to provide open access transportation service ``to the same extent 
that, and in the same manner'' as intrastate pipelines are authorized 
to perform such service by Subpart C.
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    \9\ See 18 CFR 284.7(b), 284.9(b), and 284.122.
    \10\ See Associated Gas Distributors v. FERC, 824 F.2d 981, 
1002-1003 (D.C. Cir. 1987) (Associated Gas Distributors); Mustang 
Energy Corp. v. Federal Energy Regulatory Comm'n, 859 F.2d 1447, 
1457 (10th Cir. 1988), cert. denied, 490 U.S. 1019 (1988); see also 
EPGT Texas Pipeline, 99 FERC ] 61,295 (2002).
    \11\ Pipeline Service Obligations, and Revisions to Regulations 
Governing Self-Implementing Transportation Under Part 284 of the 
Commission's Regulations; Regulation of Natural Gas Pipelines After 
Partial Wellhead Decontrol, Order No. 636-B, 61 FERC ] 61,272, at 
61,992 n.26 (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 (D.C. Cir. 1996), order on remand, Order No. 636-
C, 78 FERC ] 61,186 (1997).
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    5. The Commission currently has less stringent transactional 
reporting requirements for NGPA section 311 intrastate pipelines and 
Hinshaw pipelines, than for interstate pipelines. In Order No. 637,\12\ 
the Commission revised the reporting requirements for interstate 
pipelines in order to provide more transparent pricing information and 
to permit more effective monitoring for the exercise of market power 
and undue discrimination. As adopted by Order No. 637, Sec.  284.13(b) 
of the Commission's regulations requires interstate pipelines to post 
on their internet websites basic information on each transportation and 
storage transaction with individual shippers, no later than the first 
nomination under a transaction. This information includes:
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    \12\ 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 (D.C. 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 (D.C. Cir. 2005).
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     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
     Whether any affiliate relationship exists.
    6. In addition, Sec.  284.13(e) of the Commission's regulations 
requires interstate pipelines to file semi-annual reports of their 
storage injection and withdrawal activities, including the identities 
of the customers, the volumes injected into and withdrawn from storage 
for each customer and the unit charge and total revenues received.
    7. The Commission has not imposed any daily transactional posting 
requirement on section 311 and Hinshaw pipelines comparable to the 
daily posting requirement in Order No. 637. Until Order No. 735, Sec.  
284.126(b) of the Commission's regulations only required intrastate 
pipelines to file annual reports of their transportation transactions 
with the Commission, excluding storage transactions. Those reports 
included the following information:
     The name of the shipper receiving transportation service
     The type of service performed (i.e. firm or interruptible)
     The total volumes transported for the shipper, including 
for firm service a separate statement of reservation and usage 
quantities
     Total revenues received for the shipper, including for 
firm service a separate statement of reservation and usage revenues.
    8. Unlike the interstate pipelines' transactional posting 
requirements adopted by Order No. 637, Sec.  284.126(b) of the 
Commission's regulations did not require intrastate pipelines to report 
the rate charged under each contract, the duration of the contract, the 
receipt and delivery points, and the zones or segments covered by each 
contract, whether the contract includes any special terms and 
conditions, or whether there is an affiliate relationship between the 
pipeline and the shipper.
    9. Section 284.126(c) of the Commission's regulations requires 
section 311 intrastate pipelines and Hinshaw pipelines to file a semi-
annual report of their storage activity, within 30 days of the end of 
each complete storage and injection season. This requirement

[[Page 80687]]

is substantially the same as the 18 CFR 284.13(e) requirement that 
interstate pipelines file such semi-annual reports of their storage 
activity.
    10. In November 2008, the Commission denied a request by SG 
Resources Mississippi, L.L.C. (SGRM), an interstate storage provider 
with market-based rates, for waiver of the Order No. 637 requirements 
that interstate pipelines post the rates charged in each transaction no 
later than first nomination for service. SGRM contended that the Order 
No. 637 daily posting requirements placed market-based rate interstate 
storage providers at a competitive disadvantage with market-based rate 
NGPA section 311 intrastate storage providers, who were subject only to 
semi-annual storage and annual transportation reporting requirements. 
The Commission held that the interstate pipeline posting requirements 
are necessary to provide shippers with the price transparency they need 
to make informed decisions, and the ability to monitor transactions for 
undue discrimination and preference.\13\ The Commission also found that 
the requested exemption would be contrary to NGA section 4(c)'s 
requirement that ``every natural gas company * * * keep open * * * for 
public inspection * * * all rates.'' \14\
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    \13\ SG Resources Mississippi, L.L.C., 125 FERC ] 61,191 (2008) 
(SGRM).
    \14\ 15 U.S.C. 717c(c).
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    11. However, simultaneously with the denial of SGRM's waiver 
request, the Commission commenced this proceeding with a Notice of 
Inquiry (NOI) in order to explore (1) whether the disparate reporting 
requirements for interstate and intrastate pipelines have an adverse 
competitive effect on the interstate pipelines and (2) if so, whether 
the Commission should modify the reporting requirements for section 311 
intrastate pipelines and Hinshaw pipelines in order to make them more 
comparable to the 18 CFR 284.13(b) posting requirements for interstate 
pipelines.\15\ Based upon the comments received in response to the NOI, 
the Commission issued a Notice of Proposed Rulemaking (NOPR),\16\ 
proposing to revise its transactional reporting requirements for 
intrastate pipelines. The Commission determined not to impose the full 
interstate pipeline daily transactional positing requirements on 
section 311 and Hinshaw pipelines. The Commission was concerned that 
the burden of a daily internet posting requirement could discourage 
section 311 and Hinshaw pipelines from performing interstate service, 
contrary to the purpose of the NGPA. In addition, it did not appear 
from the comments that there was widespread concern among interstate 
pipelines that foregoing a daily posting requirement would cause 
significant adverse competitive effects. However, the Commission 
proposed increased transactional reporting requirements for section 311 
and Hinshaw pipelines in order to provide shippers and the Commission 
with more timely and useful information concerning the transactions 
entered into by section 311 and Hinshaw pipelines.
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    \15\ Contract Reporting Requirement of Intrastate Natural Gas 
Companies, FERC Stats. & Regs. ] 35,559 (2008) (NOI).
    \16\ Contract Reporting Requirements of Intrastate Natural Gas 
Companies, FERC Stats. & Regs. ] 32,644 (2009) (NOPR).
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    12. As adopted by Order No. 735, the increased transactional 
reporting requirements for section 311 and Hinshaw pipelines are as 
follows. First, the Commission modified the existing 18 CFR 284.126(b) 
annual transportation reporting requirement to require section 311 and 
Hinshaw pipelines to make the report on a quarterly basis. Second, the 
Commission required that the reports cover storage transactions as well 
as transportation transactions. Third, Order No. 735 required that the 
reports must contain the following information on each transaction, 
aggregated by contract:
    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 
ending month and year of the current agreement;
    vii. Total volumes transported, stored, injected, or withdrawn for 
the shipper; and
    viii. Total revenues received for the shipper. The report should 
separately state revenues received under each rate component.
    13. Finally, Order No. 735 established a procedure for the Form No. 
549D reports to be filed in a uniform electronic format and posted on 
the Commission's web site, and held that those reports must be public 
and may not be filed with information redacted as privileged. The 
Commission found that these transactional reporting requirements 
appropriately balanced the need for increased transparency of section 
311 and Hinshaw pipeline transactions, while avoiding unduly burdensome 
requirements that might discourage such pipelines from participating in 
the interstate market.
    14. While Order No. 735 revised the 18 CFR 284.126(b) report to 
include storage transactions, the Commission continued to require 
section 311 and Hinshaw pipelines to make the semi-annual storage 
activity reports currently required by Sec.  284.126(c) of the 
Commission's regulations. The Commission explained in the NOPR that 
those reports included information that is not contained in the 
proposed quarterly transactional reports. Specifically, Sec.  
284.126(c) of the Commission's regulations requires section 311 and 
Hinshaw pipelines to report total volumes injected into storage during 
each complete storage injection season and total volumes withdrawn from 
storage during each complete storage withdrawal season. Such seasonal 
information is not captured by the new 18 CFR 284.126(b) quarterly 
transactional reports, because those reports do not correlate with the 
typical five-month withdrawal and seven-month injection seasons. The 
Commission also stated that retaining the 18 CFR 284.126(c) semi-annual 
storage activity report for section 311 and Hinshaw pipelines is 
consistent with the Commission's existing requirement, in Sec.  
284.13(e) of the Commission's regulations, that interstate pipelines 
also make such semi-annual storage activity reports in addition to 
posting transactional information pursuant to Sec.  284.13(c) of the 
Commission's regulations.

II. Discussion

    15. For the reasons discussed below, the Commission generally 
denies rehearing of Order No. 735. However, the Commission does grant 
rehearing in several respects. First, the Commission removes the 
requirement that the new quarterly reports include the contract end-
date for interruptible transactions. Second, the Commission eliminates 
the increased per-customer revenue reporting requirements by requiring

[[Page 80688]]

such revenues to be reported only on an annual basis and excluding 
storage revenues from the report. Third, the Commission extends the 
deadline for submitting the quarterly reports from approximately 30 
days after the end of the quarter to 60 days. With these modifications, 
the Commission reaffirms all other aspects of Order No. 735, including 
the requirements that the quarterly reports be filed in a uniform 
electronic format with no information redacted as privileged and be 
posted on the Commission's Web site. Contemporaneously with this order, 
the Commission is also issuing an NOI in Docket No. RM11-4-000 to 
consider issues related the existing semi-annual storage reporting 
requirement for both interstate pipelines and section 311 and Hinshaw 
pipelines.
    16. Below, we first discuss the modifications to Order No. 735 we 
are making on rehearing. We then turn to the other objections to Order 
No. 735.

A. Changes to the Quarterly Reporting Requirement

1. Interruptible Contract End-Dates
    17. Section 284.126(b)(1)(vi) of the Commission's regulations, as 
adopted by Order No. 735, requires that section 311 and Hinshaw 
pipelines include in their quarterly transactional reports the duration 
of each active contract for both firm and interruptible service, 
including the beginning and ending date. Before Order No. 735, 18 CFR 
284.126(b) did not require this information from intrastate pipelines. 
Currently 18 CFR 284.13(b)(1)(v) requires interstate pipelines to post 
the duration of firm contracts but 18 CFR 284.13(b)(2) has no similar 
requirement to post the duration of interruptible contracts. In 
addition, 18 CFR 284.13(c)(2)(iv) requires interstate pipelines to 
report the effective and expiration dates for firm transportation and 
storage contracts quarterly as part of their Index of Customers, but 
not for interruptible contracts.\17\ Neither the interstate nor 
intrastate semi-annual storage reports require this information.
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    \17\ 18 CFR 284.13 (c)(2)(iv) (2010, prior to effective date of 
Order No. 735).
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    18. On rehearing, Enstor objects to the requirement that section 
311 and Hinshaw pipelines reveal the ending dates of their 
interruptible storage contracts, including contracts for park and loan 
service. Enstor states that it enters into separate contracts for each 
interruptible transaction and that the end date of those transactions 
is commercially sensitive. Despite the time lag between the execution 
of a contract and its ultimate disclosure in a quarterly report, the 
ending date of an interruptible transaction may still be in the future 
when the quarterly report is filed. Enstor states that knowledge of the 
forward month when a parking or lending transaction will end will 
enable other market participants to recreate the storage position of 
individual Enstor customers. Enstor states that, as a result, a 
potential storage customer interested in a short-term parking 
arrangement customer will be able to ``lowball'' Enstor based on its 
knowledge of Enstor's inventory and pricing information. Enstor argues 
that requiring market-based intrastate pipelines to reveal this 
information, while not imposing a similar requirement on interstate 
pipelines, results in unduly disparate treatment of the two types of 
pipelines.\18\ Enstor urges the Commission to remove the requirement to 
report the end-date of interruptible transactions in order to maintain 
its policy in Order No. 735 of equalizing NGA and section 311/Hinshaw 
reporting requirements. Enogex makes a similar argument from a 
theoretical perspective, arguing that the expansion of the reporting 
requirements would indirectly impose a greater burden on section 311 
companies than on interstate pipelines which, it argues, is contrary to 
the intent of the NGPA.\19\
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    \18\ None of the commenters on the NOPR objected specifically to 
the proposal to require the ending dates of interruptible contracts 
to be reported, although they did raise concerns generally about 
commercially sensitive data.
    \19\ Enogex at 16.
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    19. The Commission will revise 18 CFR 284.126 (b)(1)(vi) so that 
section 311 and Hinshaw pipelines are only required to report contract 
end-dates for firm transportation and firm storage contracts, not for 
interruptible contracts. Because interstate pipelines are not required 
to report the end-dates of their interruptible transactions, imposing 
such a requirement on section 311 and Hinshaw pipelines is contrary to 
Order No. 735's purpose of making the reporting requirements for the 
two sets of pipelines more similar. The absence of such a reporting 
requirement for interstate pipelines does not appear to have hampered 
the ability of the Commission and other interested parties to monitor 
the market for undue discrimination. Moreover, some pipelines, unlike 
Enstor, do not enter into separate contracts for each interruptible 
transaction, but rather enter into a single master interruptible 
contract under which multiple individual transactions may occur. In 
such circumstances, the end-date of the interruptible contract is of 
limited significance.
2. Customer Revenues
    20. Before Order No. 735, Sec.  284.126(b) of the Commission's 
regulations required section 311 and Hinshaw pipelines to report, on an 
annual basis, the actual revenues collected from each transportation 
customer, not including storage.\20\ The Commission does not currently 
require interstate pipelines to report revenues received from each 
customer for non-storage services. Both the interstate and intrastate 
semi-annual storage reports, however, do require reporting of the 
revenues received from each storage customer during storage injection 
and withdrawal seasons.\21\ Section 284.126(b)(1)(viii) of the 
Commission's regulations, as adopted by Order No. 735, requires section 
311 and Hinshaw pipelines to report the total revenues received from 
each shipper on a quarterly basis for both transportation and storage.
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    \20\ 18 CFR 284.126(b)(4) (2010, prior to effective date of 
Order No. 735).
    \21\ 18 CFR 284.13(e)(5), 284.126(c)(5).
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    21. In its rehearing request, Enstor urges the Commission to exempt 
storage providers with market-based rates from the requirement to 
report per-customer revenues publicly. Among other arguments, Enstor 
points out that interstate storage providers are not required to report 
this information in their daily Web site postings. Enstor therefore 
asserts that, in this respect, the new quarterly reports required by 
Order No. 735 actually require more information from intrastate than 
interstate storage providers, contrary to the Commission's stated 
intent of bringing the intrastate and interstate reporting requirements 
more in line with each other. Enstor asserts that the requirement would 
put intrastate storage providers at a competitive disadvantage to 
interstate storage providers. Enstor also states that while such 
customer-by-customer revenue information is included in the semi-annual 
storage reports of both interstate and intrastate pipelines, Enstor and 
other pipelines file such reports subject to a request for privileged 
treatment.
    22. We grant rehearing in part on this issue, and will revise 18 
CFR 284.126(b)(1)(viii) and the analogous lines of Form No. 549D so as 
to (1) collect per-customer revenue information only on an annual basis 
and (2) exclude storage revenues from the report. This will return the 
per-customer revenue reporting requirement to the status quo before 
Order No. 735. As a result, section 311 and Hinshaw storage

[[Page 80689]]

providers will not be subject to any greater per-customer revenue 
reporting requirement than interstate pipelines. Both sets of pipelines 
will continue to be required to report per-customer revenues for 
storage services in the semi-annual storage reports, required by 18 CFR 
284.126(c)(5) for section 311 and Hinshaw pipelines and by 18 CFR 
284.13(e)(5) for interstate pipelines. In a contemporaneous NOI, the 
Commission is requesting comments on whether the existing semi-annual 
storage reporting requirements for both interstate pipelines and 
section 311 and Hinshaw pipelines should be modified. The issue of 
whether any change is warranted in the current per-customer storage 
revenue reporting requirement, including the confidentiality of that 
information, will be considered in that proceeding.
    23. The Commission recognizes that the requirement that section 311 
and Hinshaw pipelines report annual non-storage revenues imposes a 
greater reporting requirement on those pipelines, than on interstate 
pipelines. Interstate pipelines are not required to make any report of 
per-customer non-storage revenues. However, that is a reporting 
disparity that exists in the Commission's current regulations. The 
Commission relies on the existing annual reports of per-customer non-
storage revenues to verify information submitted by section 311 and 
Hinshaw pipelines in their rate cases, and therefore finds that such 
information should continue to be collected. In addition, the rehearing 
applicants do not appear to have significant concerns about the 
commercial sensitivity of non-storage revenue information. Rather, they 
are primarily concerned that making storage revenue public on a 
quarterly basis could place storage providers with market-based rates 
at a competitive disadvantage against their shippers who could use the 
relatively fresh revenue information to seek lower prices than they 
might otherwise obtain.
3. Quarterly Reporting Deadlines
    24. Order No. 735 required that each quarterly report be filed on 
the first day of the month one month after the end of the relevant 
quarter, or roughly 30 days from the end of each quarter. Jefferson and 
TPA both urge the Commission to extend the due dates for filing 
quarterly reports. Both parties argue that Form No. 549D is much more 
detailed than previous reports, and thus will require more time to 
compile. TPA notes that some pipelines' measurement and accounting 
systems are designed to only send invoices 30 days after the end of the 
service month, and so they could not file reports so soon. Jefferson 
seeks a 90-day window between the close of the reporting period and the 
date when the report is due; TPA seeks a 60-day window.
    25. The Commission will revise 18 CFR 284.126(b)(2) so as to 
provide a roughly 60-day window. While the Commission has used 30-day 
windows for other natural gas pipeline reports,\22\ Form No. 549D is 
fairly detailed and may require more time to complete. It may be more 
comparable in this sense to the Form No. 3-Q quarterly financial 
report, which uses a 60-day window.\23\ Accordingly, 18 CFR 
284.126(b)(2) is amended to state that the quarterly Form No. 549D 
report for the period January 1 through March 31 must be filed on or 
before June 1; the quarterly report for the period April 1 through June 
30 must be filed on or before September 1; the quarterly report for the 
period July 1 through September 30 must be filed on or before December 
1; and the quarterly report for the period October 1 through December 
31 must be filed on or before March 1.
---------------------------------------------------------------------------

    \22\ Intrastate pipelines must file semi-annual storage reports 
within 30 days of the end of each complete storage injection and 
withdrawal season. 18 CFR 284.126(c).
    \23\ Natural gas companies that file a FERC Form 2 must file the 
FERC Form 3-Q within 60 days after the reporting quarter, and 
companies that file a FERC Form 2-A must file the FERC Form 3-Q 
within 70 days. 18 CFR 260.300(b)(vii), (c)(vii).
---------------------------------------------------------------------------

B. Justification for Increased Transparency Required by the Rule

    26. Order No. 735 adopted increased transactional reporting 
requirements for section 311 and Hinshaw pipelines in order to provide 
greater transparency to the market.\24\ The Commission found such 
transparency to be necessary so shippers can make informed purchasing 
decisions, and also to permit both shippers and the Commission to 
monitor actual transactions for evidence of possible abuse of market 
power or undue discrimination. The Commission found that the existing 
reporting requirements in 18 CFR 284.126 were inadequate for this 
purpose. For example, the annual reports of transportation transactions 
required by existing 18 CFR 284.126(b) did not include (1) the rates 
charged by the pipeline under each contract, (2) the receipt and 
delivery points and zones or segments covered by each contract, (3) the 
quantity of natural gas the shipper is entitled to transport, store, or 
deliver, (4) the duration of the contract, or (5) whether there is an 
affiliate relationship between the pipeline and the shipper. Similarly, 
the semi-annual storage reports required by existing 18 CFR 284.126(c) 
do not include the rates charged by the storage provider in each 
contract, the duration of each contract, or whether there is an 
affiliate relationship between the storage provider and its customer.
---------------------------------------------------------------------------

    \24\ Order No. 735, FERC Stats. & Regs. ] 31,310 at P 73-79.
---------------------------------------------------------------------------

    27. Order No. 735 found that all this information is necessary to 
allow the Commission, shippers, and others to determine the extent to 
which particular transactions are comparable to one another for 
purposes of monitoring for undue discrimination. For example, contracts 
for service on different parts of a pipeline system or with different 
durations may not be comparable to one another. The additional 
information required to be reported by the Final Rule is also necessary 
to allow shippers to make informed decisions about their capacity 
purchases. Shippers need to know the price paid for capacity over a 
particular path to enable them to decide, for instance, how much to 
offer for the specific capacity they seek.
    28. Order No. 735 also held that, as a matter of policy, section 
311 and Hinshaw pipelines must file the new quarterly transactional 
reports as public in order to achieve the Final Rule's purpose of 
improving transparency, monitoring discrimination, and fostering 
efficient markets. The Commission recognized the concern of some 
pipelines that disclosure of commercially sensitive information would 
enable a shipper to know what the pipeline is charging other shippers 
and thus prevent the pipeline from being able to negotiate the best 
price for the services it offers. However, the Commission found that 
its requirement that the reports be filed quarterly would permit a 
significant delay between contract execution and disclosure, and that 
delay should temper any potential adverse effects from disclosure.
    29. Order No. 735 concluded that public disclosure of all 
information in the quarterly reports is necessary to permit all market 
participants to monitor the market and detect undue discrimination. The 
Commission also stated that it expects and hopes that market 
participants will use the information from these reports in order to 
educate themselves about market conditions. Regardless of any adverse 
effect on individual entities, public disclosure will improve the 
market as a whole by improving efficiency and competition.
    30. On rehearing, Enogex and Enstor contend that the Commission has 
failed to support the increased transactional reporting and public 
disclosure requirements which Order No. 735 imposes on section 311 
pipelines. In

[[Page 80690]]

general, they contend that (1) the Commission lacks statutory authority 
under the NGPA to impose these requirements on section 311 pipelines, 
(2) these requirements will harm section 311 storage providers with 
market based rates, (3) the Commission has failed to show that there is 
an industry problem which these requirements will ameliorate, and (4) 
these requirements impose unnecessary burdens on section 311 pipelines. 
For the reasons set forth below, we find these contentions unpersuasive 
and reaffirm the Final Rule.
1. Statutory Authority To Require Public Disclosure
    31. In discussing its statutory authority for the increased 
reporting and public disclosure requirements of Order No. 735, the 
Commission first addressed its statutory authority with respect to 
Hinshaw pipelines. The Commission pointed out that it regulates the 
interstate services of Hinshaw pipelines under the NGA.\25\ NGA section 
4(c) requires that ``under such rules and regulations as the Commission 
may prescribe, every natural gas company shall * * * keep open for 
public inspection * * * all rates * * * together with all contracts 
which in any manner affect or relate to such rates.'' While the NGA 
gives the Commission some discretion with respect to how to provide for 
the disclosure of rate schedules and contracts, clearly the public 
disclosure of rate schedules and related contracts, in some manner, is 
required.\26\ Therefore, Order No. 735 concluded that its requirement 
that the quarterly reports of Hinshaw pipelines be posted without any 
information redacted was simply carrying out NGA section 4(c)'s 
requirement for public disclosure of rate and contract information 
``under such rules and regulations as the Commission may prescribe.'' 
The Commission also pointed out that NGA section 23(a)(1) directs the 
Commission ``to facilitate price transparency in markets for the sale 
or transportation of physical natural gas in interstate commerce.'' 
\27\
---------------------------------------------------------------------------

    \25\ Consumers Energy Co. v. FERC, 226 F.3d 777 (6th Cir. 2000) 
(holding that the Commission must comply with the requirements of 
NGA section 5 in order to require a Hinshaw pipeline to modify its 
rates for interstate service).
    \26\ SGRM, 125 FERC ] 61,191 at P 23 (quoting Order No. 637-A, 
FERC Stats. & Regs. ] 31,099 at 31,614).
    \27\ 15 U.S.C. 717t-2(a)(1). See Energy Policy Act of 2005, Pub. 
L. 109-58, section 316 (Natural Gas Market Transparency Rules), 119 
Stat. 594 (2005).
---------------------------------------------------------------------------

    32. Order No. 735 then turned to the Commission's statutory 
authority with respect to section 311 pipelines. The Commission 
recognized that the NGPA does not contain an express public disclosure 
provision similar to NGA section 4(c). However, the Commission stated 
that NGPA section 311(c) authorizes the Commission to prescribe the 
``terms and conditions'' under which intrastate pipelines perform 
interstate service. Order No. 735 concluded that requiring NGPA section 
311 pipelines to publicly disclose transactional information for the 
purpose of allowing shippers and others to monitor NGPA section 311 
transactions for undue discrimination is well within the Commission's 
broad conditioning authority under section 311(c).\28\
---------------------------------------------------------------------------

    \28\ See, e.g., Associated Gas Distributors, 824 F.2d at 1015-18 
(affirming the Commission's use of Section 311(c) to require 
intrastate pipelines to permit their interstate sales customers to 
convert to transportation-only service).
---------------------------------------------------------------------------

    33. Enogex and Enstor do not contest the Commission's authority 
under NGA section 4(c) to require Hinshaw pipelines to report and 
publicly disclose all the information in the quarterly reports adopted 
by Order No. 735. However, they contend that imposing these 
requirements on section 311 pipelines goes beyond the Commission's 
conditioning authority under NGPA section 311(c). Enogex points out 
that the purpose of the NGPA is to allow intrastate pipelines to 
compete in the interstate transportation market without bearing the 
burden of full NGA regulation. It asserts that, when coupled with the 
existing triennial rate review requirement for section 311 pipelines 
and other reporting requirements, the new quarterly reporting and 
disclosure requirements of Order No. 735 would regulate section 311 
pipelines on a level nearly equivalent to the regulatory oversight to 
which interstate pipelines are subject under the NGA. Enstor contends 
that, in Associated Gas Distributors,\29\ the court held that the 
Commission's exercise of its NGPA section 311(c) conditioning authority 
should conform to the overall purposes of the NGPA, namely ``to assure 
adequate supplies of natural gas at fair prices.'' Enstor contends that 
Order No. 735 failed to explain how the new quarterly reports will 
accomplish that goal.
---------------------------------------------------------------------------

    \29\ 824 F.2d 981 at 1017-18.
---------------------------------------------------------------------------

    34. The Commission finds that requiring section 311 pipelines to 
report and disclose the information contained in the quarterly reports 
required by Order No. 735, as amended in the preceding sections of this 
order, is well within the Commission's conditioning authority under 
NGPA section 311(c). The information contained in these quarterly 
reports is basic information concerning the terms of the section 311 
pipelines' contracts with their shippers.\30\ In the NGA and the 
Federal Power Act (FPA), Congress required the Commission to provide 
for the public disclosure of the rates and contracts of interstate gas 
and oil pipelines and public utilities.\31\ Public disclosure of 
jurisdictional contracts is thus at the heart of each statute adopted 
by Congress prior to the NGPA for regulating the rates, terms, and 
conditions of entities subject to our jurisdiction.
---------------------------------------------------------------------------

    \30\ Enogex and Enstor do not object to the requirement to state 
whether the shipper is an affiliate of the pipeline. While the 
amended requirement to report annual non-storage revenues collected 
from each customer goes beyond reporting contract terms, both Enogex 
and Enstor are primarily concerned with Order No. 735's effect on 
storage providers with market-based rates. Therefore, the removal of 
the requirement that storage revenues be reported addresses their 
concern with respect to the per-customer revenue reporting 
requirement in the Order No. 735 reports.
    \31\ NGA section 4(c); FPA section 205(c).
---------------------------------------------------------------------------

    35. The NGPA does not set forth a comprehensive scheme for 
Commission regulation of interstate service provided by intrastate 
pipelines in the manner of the NGA or FPA. Rather, it delegates to the 
Commission broad authority ``by rule or order [to] authorize any 
intrastate pipeline to transport natural gas on behalf of[] any 
interstate pipeline [or] local distribution company served by any 
interstate pipeline.'' \32\ Consistent with that broad authorization, 
section 311(c) provides that ``Any authorization granted under this 
section shall be under such terms and conditions as the Commission may 
prescribe.'' Given that public disclosure of contracts has been a 
fundamental aspect of the Commission's regulation of all the entities 
subject its jurisdiction, the Commission finds that requiring section 
311 pipelines to report and disclose the terms of their contracts is 
well within the broad authority Congress delegated to us to determine 
under what terms intrastate pipelines may perform interstate 
transportation service.
---------------------------------------------------------------------------

    \32\ NGPA section 311(a)(2)(A).
---------------------------------------------------------------------------

    36. The Commission has recognized throughout this proceeding that 
Congress intended in the NGPA to encourage intrastate pipelines to 
participate in the interstate transportation market by enabling them to 
do so without bearing the burden of full Commission regulation under 
the NGA.\33\ Contrary to Enogex, the reporting requirements adopted in 
Order No. 735 are substantially less burdensome than the reporting 
requirements we have imposed on

[[Page 80691]]

interstate pipelines regulated under the NGA. The Commission requires 
interstate pipelines to maintain internet Web sites and post the terms 
of each contract before the first nomination for service under that 
contract. By contrast, this rule does not require section 311 pipelines 
to maintain an internet Web site. Order No. 735 only requires section 
311 pipelines to make quarterly reports of the terms of their 
contracts. Moreover, in this order we have extended the deadline for 
each report from 30 days after the end of the quarter to 60 days after 
the end of the quarter. In addition, while the reports must be filed in 
a standardized electronic format, the Commission has developed the 
electronic form in a PDF format and an XML Schema that, upon OMB 
approval, will be available to download from the FERC Web site and save 
to a user's computer desktop.
---------------------------------------------------------------------------

    \33\ Mustang Energy Corp. v. Federal Energy Regulatory Comm'n, 
859 F.2d 1447, 1457 (10th Cir. 1988), cert. denied, 490 U.S. 1019 
(1988); see also EPGT Texas Pipeline, 99 FERC ] 61,295 (2002).
---------------------------------------------------------------------------

    37. In Associated Gas Distributors,\34\ the court affirmed the 
Commission's use of its NGPA section 311(c) conditioning authority to 
impose conditions necessary to assure that section 311 intrastate 
pipelines do not engage in undue discrimination. The court also stated 
that ``Section 311 itself states no explicit standards for the exercise 
of the power, but the overall purposes of the NGPA provide a standard--
somewhat amorphous to be sure--against which we can and must measure 
the Commission decision.'' \35\ The court further stated that the 
Supreme Court had declared that the NGPA's ``aim * * * was to assure 
adequate supplies of natural gas at fair prices.'' \36\ Order No. 735's 
requirement that section 311 pipelines report and disclose 
transactional information is consistent with this goal, because it will 
make the market operate more efficiently. The Commission has 
consistently held that disclosure of transactional information ``will 
benefit the market as a whole, by improving efficiency and competition. 
Buyers of services need good information in order to make good choices 
among competing capacity offerings. Without the provision of such 
information, competition suffers.'' \37\ Similarly, in Order No. 2001, 
adopting the Electric Quarterly Reports (EQRs) required of public 
utilities, the Commission held,
---------------------------------------------------------------------------

    \34\ 824 F.2d 981 at 1002-1003.
    \35\ Id. at 1016 (citation omitted).
    \36\ Id. at 1017, quoting Transcontinental Gas Pipe Line Corp. 
v. State Oil & Gas Board, 474 U.S. 409, 421 (1986).
    \37\ Order No. 637-A, FERC Stats. & Regs. ] 31,099 at 31,614-
615.

    [W]e believe that disclosure will promote competition and make 
the market operate more efficiently. * * * [E]asy access to contract 
and transaction data will give customers a basis on which to compare 
a variety of suppliers and monitor for market power and anti-
competitive behavior. This information will allow customers to reap 
further benefits from open access transmission by giving them 
improved tools to use in making buying decisions. In addition, the 
Commission hopes that making this information more understandable 
and accessible will promote competition and confidence in the 
---------------------------------------------------------------------------
fairness of the market.\38\

    \38\ Revised Public Utility Filing Requirements, Order No. 2001, 
FERC Stats. & Regs. ] 31,127, P 44-46, 74-85, 104-117, reh'g denied, 
Order No. 2001-A, 100 FERC ] 61,074, P 13-17, 30-35, 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 (2003).

    38. Our statutory authority to require section 311 pipelines to 
report and disclose transactional information is buttressed by section 
23(a)(1) of the NGA, adopted by EPAct 2005. That section directs the 
Commission to ``facilitate price transparency in markets for the * * * 
transportation of physical natural gas in interstate commerce, having 
due regard for the public interest, the integrity of those markets, 
fair competition, and the protection of consumers.'' This provision 
applies to all natural gas transportation in interstate commerce, and 
thus applies to section 311 pipelines as well as pipelines subject to 
our NGA jurisdiction. Thus, requiring the Order No. 735 quarterly 
reports by section 311 pipelines to be public is specifically in 
keeping with this directive.
2. Harm to Storage Providers With Market-based Rates
    39. Both Enogex and Enstor argue that the Commission should not 
require market-based storage companies such as themselves to report 
information publicly. Enogex argues that ``its ability to capture rates 
that are truly market-based will be severely compromised if non-section 
311 competitors have access to the rates Enogex is charging and will 
charge under specific storage service agreements.'' \39\ Enogex asserts 
that it must compete with unregulated intrastate pipelines providing 
purely intrastate service that are not subject to any disclosure 
requirements. It asserts that Order No. 735 places it at a competitive 
disadvantage to such pipelines, because the purely intrastate pipelines 
will have access to a section 311 pipeline's rate and customer 
information, while the section 311 pipeline will not have access to 
comparable information concerning the intrastate pipeline.
---------------------------------------------------------------------------

    \39\ Enogex at 13.
---------------------------------------------------------------------------

    40. Enogex contends that this is contrary to the directives of NGA 
section 23. Enogex contends that Order No. 735's public disclosure 
requirement violates the requirement of section 23(a)(1) that the 
Commission have due regard for the integrity of markets and fair 
competition. It also points out that section 23(b)(1) requires the 
Commission to exempt from disclosure information that would be 
detrimental to the operation of an effective market, and section 
23(b)(2) requires the Commission to ``seek to ensure that consumers and 
competitive markets are protected from the adverse effects of potential 
collusion or other anti-competitive behaviors that can be facilitated 
by untimely public disclosure of transaction-specific information.''
    41. Enstor claims that reporting such commercially sensitive 
information would distort the markets and discourage infrastructure 
development. Enstor's primary concern is that Order No. 735 requires 
section 311 and Hinshaw storage providers with market-based rates to 
disclose information which interstate storage providers are not 
required to disclose, specifically the end-date of interruptible 
transactions and revenue collected from each customer. Enstor asserts 
that disclosure of this information will place section 311 and Hinshaw 
storage providers at a competitive disadvantage with interstate 
pipelines. Enstor asserts that despite the fact there will be a 
considerable ``time lag between the execution of a contract and its 
ultimate disclosure in a quarterly report,'' the obligation to report 
nevertheless ``will undermine the very business model that Enstor and 
other like storage providers have used.'' \40\ Shippers would be able 
to ``recreate the storage positions'' of their competitors and ``gain 
valuable insight into'' others' market positions, forcing Enstor's 
prices downward.\41\
---------------------------------------------------------------------------

    \40\ Enstor Request for Rehearing at 15.
    \41\ Id.
---------------------------------------------------------------------------

    42. The Commission has consistently applied its requirements to 
report and disclose transactional information to shippers with market-
based rates on the ground that such disclosure benefits the overall 
market, and those benefits outweigh any commercial disadvantages to 
individual entities in the market. As the Commission held in Order No. 
637-A:

    The disclosure of greater information regarding capacity 
transactions is necessary to achieve these dual goals of fostering 
competition and market monitoring. To foster competition, it is not 
sufficient merely to

[[Page 80692]]

ensure there are multiple competitors, there also needs to be good 
information to enable buyers to make informed choices among the 
competitors. Difficulty in obtaining information can reduce 
competition because buyers may not be aware of potential 
alternatives and cannot compare prices between alternatives. The 
reporting requirements will expand shippers' knowledge of 
alternative offerings by providing more information about the 
capacity available from the pipeline * * *.\42\

    \42\ Order No. 637-A, FERC Stats. & Regs. ] 31,099 at 31,611-2.
---------------------------------------------------------------------------

    43. Thus, Order No. 637-A concluded that ``while disclosure of the 
transactional information may cause some commercial disadvantage to 
individual entities, it will benefit the market as a whole, by 
improving efficiency and competition.'' \43\ The Commission reached the 
same conclusion in Order No. 2001, requiring public utilities to report 
and disclose similar transactional information. Thus, the requirement 
that section 311 and Hinshaw pipelines with market-based rates publicly 
disclose transactional information is consistent with longstanding 
Commission policy.
---------------------------------------------------------------------------

    \43\ Id., at 31,614-615.
---------------------------------------------------------------------------

    44. The Commission also rejects Enogex's contention that Order No. 
735's public disclosure requirement violates the requirements of NGA 
sections 23(a)(1) and 23(b) that any transparency requirements avoid 
detrimental effects on competitive markets. Enogex appears to read 
these provisions as requiring the Commission to exempt from public 
disclosure any information that might have some effect on the 
competitive position of a particular participant in the natural gas 
market. However, these provisions only provide that, in requiring 
public disclosure, the Commission should seek to avoid detrimental 
effects on the operation of the market as a whole and protect against 
``potential collusion or other anti-competitive behaviors.'' As the 
First Circuit stated in Town of Concord v. Boston Edison Co.,

a practice is not ``anticompetitive'' simply because it harms 
competitors. After all, almost all business activity, desirable and 
undesirable alike, seeks to advance a firm's fortunes at the expense 
of its competitors. Rather, a practice is ``anticompetitive'' only 
if it harms the competitive process. It harms that process when it 
obstructs the achievement of competition's basic goals--lower 
prices, better products, and more efficient production methods.\44\

    \44\ 915 F.2d 17, 21-22 (1st Cir. 1990), cert. denied, 499 U.S. 
931 (1991).
---------------------------------------------------------------------------

    45. Neither Enogex nor Enstor have shown that Order No. 735's 
public disclosure requirements harm the competitive process or 
encourage anti-competitive behaviors. Enogex focuses on the fact that 
intrastate pipelines engaging in purely intrastate business are not 
subject to similar disclosure requirements. However, this fact does not 
justify exempting intrastate pipelines from the Order No. 735 
disclosure requirements when they perform interstate service. As Order 
No. 735 clarified, the revised reporting requirements adopted by this 
rule apply only to a section 311 pipeline's contracts for interstate 
service, not its purely intrastate contracts. Therefore, section 311 
pipelines need not disclose the rates they charge in intrastate 
transactions. While Enogex asserts that the same customers likely take 
both intrastate and section 311 services, a contract for section 311 
service allows the shipper access to the interstate natural gas 
markets, while a strictly intrastate contract does not. This fact would 
generally suggest a contract for section 311 interstate service would 
have a different value than a contract for purely intrastate service. 
Thus, a section 311 pipeline's disclosure of pricing information 
concerning its contracts for interstate service is not necessarily 
indicative of the pipeline's pricing policies for its purely intrastate 
services. Moreover, in this order, the Commission is extending the 
deadline for the filing of quarterly reports to two months after the 
end of the relevant quarter. Thus, for example, contracts entered into 
during the period January through March need not be disclosed until 
June 1. This allows a delay in disclosure of from two to five months 
after contract execution, depending upon when in the quarter a contract 
was entered into, thereby minimizing any harm from disclosure of the 
contract's terms.
    46. In these circumstances, the Commission finds that the benefits 
to the interstate market of Order No. 735's public disclosure 
requirements outweigh any harm arising from the fact that there is no 
similar public disclosure requirement for purely intrastate pipelines. 
That a state may not have imposed disclosure requirements for services 
within its jurisdiction should not prevent the Commission from adopting 
public disclosure requirements for the services within our jurisdiction 
and thereby providing the interstate market with the benefit of greater 
transparency.
    47. Enstor's primary concern is that Order No. 735 requires section 
311 storage providers to disclose certain information that interstate 
storage providers are not required to disclose, specifically the end-
date for interruptible contracts and per-customer revenues. However, we 
are eliminating that disparity in this order, by removing both 
requirements from the quarterly reports that section 311 pipelines are 
required to submit by this Final Rule. As revised, we are confident 
that the transactional reporting requirements appropriately balance the 
need for increased transparency of section 311 and Hinshaw pipeline 
transactions, while avoiding unduly burdensome market distortions that 
might discourage such pipelines from participating in the interstate 
market.
3. Evidence
    48. Citing the standards for reasoned decision-making and abuse of 
discretion,\45\ Enogex argues that the Commission failed to support the 
Final Rule with any evidence of market abuse requiring an expansion of 
the scope and frequency of the existing contract reporting 
requirements. Enogex argues that this is contrary to the D.C. Court's 
decision in National Fuel Gas Supply Corp. v. FERC, where the court 
reversed a Commission rule on the ground that the Commission was 
``professing that an order ameliorates a real industry problem but then 
citing no evidence that there is in fact an industry problem.'' \46\ 
Enogex claims that the Order No. 735 failed to cite any examples of 
market abuse, only potential abuse. It also argues that while the 
Commission seeks to increase transparency, ``[i]ncreased transparency 
in of itself is not a sufficient basis to impose a substantial new 
reporting burden.'' \47\
---------------------------------------------------------------------------

    \45\ Enogex at 5, 7-10 (citing, inter alia, Administrative 
Procedure Act, 5 U.S.C. 706(2)(A), (E)).
    \46\ Enogex at 7 (quoting National Fuel Gas Supply Corp. v. 
FERC, 468 F.3d 831, 843 (D.C. Cir 2006) (National Fuel Gas)).
    \47\ Enogex at 9.
---------------------------------------------------------------------------

    49. Enstor makes a similar argument, also citing the court's 
decision in National Fuel Gas, although it only argues for 
reconsidering the Final Rule ``to the extent that it has imposed 
reporting requirements on intrastate storage providers that provide 
service at market-based rates under the NPGA.'' \48\ Enstor notes that 
the record material in the Final Rule concerns allegations about 
intrastate pipeline transportation, but none ``on the part of storage 
companies,'' especially those that ``do not possess market power.'' 
\49\ Enstor argues that the Commission's exercise of its conditioning 
authority under section 311 of the NGPA cannot be justified by ``the 
potential for undue discrimination.'' \50\
---------------------------------------------------------------------------

    \48\ Enstor at 3.
    \49\ Enogex at 9.
    \50\ Enstor at 10.

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

[[Page 80693]]

    50. We disagree with both Enogex and Enstor. In arguing that the 
Commission must present evidence of market abuses by section 311 
pipelines in order to support the new disclosure requirements, Enogex 
and Enstor miss the point that the purpose of this rule is not solely 
to minimize market abuses and undue discrimination. As explained above, 
a primary purpose of this rule is to provide shippers better 
information about relative prices and other terms of different capacity 
offerings so that they can make more informed choices among 
competitors. This will make the market operate more efficiently. As the 
---------------------------------------------------------------------------
D.C. Circuit held in Alabama Power Co.,

    Perfect information available to all buyers and sellers is, 
indeed, one of the conditions of the economic model of ``perfect 
competition,'' and where the remaining conditions are satisfied, 
dissemination of information tends to facilitate prompt adjustment 
to the market clearing price by all parties to transactions.\51\

    \51\ Alabama Power Co. v. Federal Power Comm'n, 511 F.2d 383, 
391 n.13 (D.C. Cir. 1974).

    51. It is not necessary to present evidence to support the well-
accepted principle that better information enables purchasers to make 
better decisions and improves the overall efficiency of the market. 
Indeed, in the same National Fuel Gas case that Enogex quotes, the 
court explains that if the Commission seeks to justify a new regulation 
based solely on theoretical grounds, it may do so.\52\ Therefore, 
increased transparency of transactions subject to the Commission's 
jurisdiction in order to help shippers make informed purchasing 
decisions is a sufficient basis to impose a substantial new reporting 
duty, regardless of whether some section 311 of Hinshaw pipelines have 
engaged in market abuses. Indeed, this was a primary ground on which 
the Commission justified the Final Rule. The Commission argued, and we 
continue to hold, that the increased transparency that the Final Rule 
brings should improve the natural gas transportation market's 
efficiency.\53\
---------------------------------------------------------------------------

    \52\ See National Fuel Gas, 468 F.3d at 839.
    \53\  See Order No. 735, FERC Stats. & Regs. ] 31,310 at P 35.
---------------------------------------------------------------------------

    52. The Commission is also requiring the new quarterly 
transactional reports in order to permit both shippers and the 
Commission to monitor section 311 and Hinshaw pipelines' jurisdictional 
interstate transactions for evidence of possible abuse of market power 
or undue discrimination. As previously discussed, public disclosure of 
the terms of jurisdictional contracts in order to ensure against undue 
discrimination among shippers is a standard part of the regulatory 
regimes established by the NGA and the FPA, in which Congress has 
directed the Commission to require such public disclosure. Therefore, 
the Commission does not believe that requiring the same method of 
enabling shippers and the Commission to monitor the contracts of 
section 311 pipelines for abuse of market power and undue 
discrimination requires the establishment of a record showing extensive 
abuses by section 311 pipelines. This is particularly the case since 
section 23 of the NGA now directs the Commission to ``facilitate price 
transparency in markets for the * * * transportation of physical 
natural gas in interstate commerce,'' including such transportation by 
section 311 pipelines. In any event, the comments in this proceeding do 
indicate that the preexisting reporting regime was not performing as 
well as it could be. For example, the Final Rule noted that ``Clayton 
Williams provides a detailed narrative suggesting that it could have 
pursued allegations that a pipeline has been engaging in unlawful 
business practices, if only it had more publicly available information 
to support its allegation'' as evidence in favor of improved reporting 
requirements.\54\ Given this testimony alleging concerns with the 
preexisting reporting regime, plus the Commission's theoretical 
framework suggesting that increased transparency would improve 
conditions in the transportation and storage market, we find the Final 
Rule adequately justified.
---------------------------------------------------------------------------

    \54\ Order No. 735, FERC Stats. & Regs. ] 31,310 at P 28.
---------------------------------------------------------------------------

    53. With regard to Enstor's argument that these concerns do not 
apply to market-based storage, we remind Enstor that a Commission 
finding that a service provider lacks market power should not be read 
to mean that its shippers are at no risk of undue discrimination or 
other unlawful practices. ``It is even more critical for the Commission 
to review pricing when the Commission is relying on competition to 
regulate rates, rather than scrutinizing the underlying cost of 
service.'' \55\
---------------------------------------------------------------------------

    \55\ Revisions to Uniform System of Accounts, Forms, Statements, 
and Reporting Requirements for Natural Gas Companies, Order No. 581, 
60 FR 53019, 53051, FERC Stats. & Regs. ] 31,026 (1995), order on 
reh'g, Order No. 581-A, FERC Stats. & Regs. ] 31,032 (1996).
---------------------------------------------------------------------------

    54. The court's decision in National Fuel Gas addressed a different 
type of rule than is at issue here. In that case, the Commission 
adopted a rule modifying its Standards of Conduct governing natural gas 
pipelines' interactions with their marketing affiliates so that the 
Standards of Conduct would also apply to non-marketing affiliates. 
These included producers, processors, and local distribution companies 
who might not hold any capacity on their affiliated pipeline. The 
purpose of the rule was to guard against pipelines giving non-marketing 
affiliates undue preference or other market abuses by non-marketing 
affiliates. The Standards of Conduct required that the affiliates 
function independently and limit the information that may be shared 
among them.
    55. In reversing the Commission, the court first emphasized that 
vertical integration between a pipeline and its affiliates produces 
benefits for consumers. The court stated that both the sharing of 
information between pipelines and affiliates and integration of 
functions have efficiency benefits. Therefore, the court found that the 
Commission cannot impede vertical integration between a pipeline and 
its affiliates without adequate justification. The court found that the 
Commission had not provided such justification either by presenting 
evidence of market abuses by non-marketing affiliates or providing a 
sufficient explanation of a theoretical danger that pipelines will 
favor their non-marketing affiliates.
    56. The rule at issue here differs from the rule at issue in 
National Fuel Gas in a number of respects. First, as already discussed, 
the purpose of this rule is not limited to preventing certain types of 
market abuses, as was the case with the rule in National Fuel Gas; 
rather a primary purpose of this rule also is to provide all market 
participants better information in order to make informed purchasing 
decisions, and thereby improve the efficiency of the market. Second, 
this rule does not impede activities by pipelines (or their affiliates) 
which the courts have found to create market efficiencies and thus 
benefit consumers, such as the vertical integration at issue in 
National Fuel Gas. To the contrary, as discussed above, the courts have 
found that public disclosure of contract terms generally benefits the 
overall market and consumers. Third, the public disclosure requirements 
adopted in Order No. 735 apply only to pipelines and transactions 
directly subject to our jurisdiction under the NGA and NGPA and do not 
affect the corporate structure of entities, such as non-marketing 
affiliates, not directly subject to our jurisdiction. Finally, the 
instant rule is carrying out Congress's directives in NGA section 4 to 
require public disclosure of Hinshaw pipelines' jurisdictional 
contracts and in NGA section 23 to provide for price transparency of 
all interstate transportation transactions. For these

[[Page 80694]]

reasons, the Commission finds that our adoption of Order No. 735 is not 
inconsistent with National Fuel Gas.
    57. Accordingly, we find sufficient cause to apply the Final Rule 
to both cost-based and market-based transactions.
4. Insufficiency of Periodic Rate Review
    58. Enogex further argues that ``the Commission erred in concluding 
that the new Form No. 549D is necessary to meet its statutory 
obligation to ensure that rates for section 311 service are `fair and 
equitable', in view of the fact that it already requires a triennial 
rate review requirement.'' \56\ Enogex claims the ``the adequacy of the 
triennial rate review requirement is evident,'' and even more stringent 
than NGA rate review ``because interstate pipelines are no longer 
subject to a periodic rate review.'' \57\ Therefore, Enogex argues, the 
reporting requirement is unnecessary.
---------------------------------------------------------------------------

    \56\ Enogex at 6.
    \57\ Enogex at 9-10.
---------------------------------------------------------------------------

    59. We reject Enogex's bare assertions about periodic rate review. 
The triennial rate review requirement does not render Order No. 735's 
increased reporting requirements unnecessary. The primary purposes of 
the two requirements are different. The Commission requires section 311 
pipelines with cost-based rates to make periodic rate filings so that 
the Commission can review whether the pipeline's maximum rates 
applicable to all transactions continue to be fair and equitable. In 
those rate review proceedings, the Commission determines whether the 
pipeline's maximum rates allow it to collect revenues in excess of its 
cost-of-service, and, if so, the Commission may require a reduction in 
the pipeline's maximum rates. Thus, the focus of a rate review filing 
is on the pipeline's generally applicable maximum rates, not the rates 
charged in individual transactions.
    60. By contrast, the primary purpose of the Order No. 735 reporting 
requirements is to enable individual shippers to make more informed 
decisions as to the prices they agree to pay in their own individual 
transactions, including with market-based rate pipelines that are not 
subject to the periodic rate review requirement. The reporting 
requirements also allow better monitoring by the Commission and 
shippers for instances of undue discrimination among shippers, a matter 
not generally addressed in rate review proceedings. While periodic rate 
review is necessary in order to ensure that a pipeline's generally 
applicable maximum rates are fair and equitable, it does not accomplish 
the goals of this rulemaking. For that purpose, it is necessary to 
require public reports of the terms of the individual contracts a 
pipeline enters into with each of its shippers, which the Commission 
and market participants may review in order to detect and mitigate 
against possible abuse of market power or undue discrimination. Such 
reporting does not occur in a periodic rate review filing.
5. Burden
    61. Enogex also argues that the Commission should not have 
implemented the Final Rule ``after acknowledging that the new quarterly 
report would be unduly burdensome when coupled with the periodic cost 
of service rate review requirement,'' \58\ and that the Commission 
``erred in concluding that the new * * * requirement would not be 
unduly burdensome from a cost and administrative standpoint.'' \59\ 
Enogex refers to Form No. 549D's ``seventy five data elements'' as an 
``extraordinary level of detail,'' and claims that ``because Enogex may 
provide for both Section 311 and intrastate services in a single 
contract, existing contract methods * * * may have to be * * * modified 
in order to report the required information.'' \60\ Finally, Enogex 
argues that ``the Commission inadvertently demonstrated that the 
triennial rate review requirement is more than sufficient,'' and urges 
that Commission to ``reverse course and terminate this rulemaking 
proceeding, even if this results in the triennial rate review 
requirement being reinstituted.'' \61\
---------------------------------------------------------------------------

    \58\ Enogex at 19.
    \59\ Enogex at 6.
    \60\ Enogex at 18.
    \61\ Enogex at 19.
---------------------------------------------------------------------------

    62. Enogex misstates the record in claiming that the Commission 
found ``that the new quarterly report would be unduly burdensome when 
coupled with the periodic cost of service rate review requirement.'' 
\62\ Rather, the Commission stated that it ``is sensitive to concerns 
that the improved reporting requirements could prove too burdensome, 
when considered in aggregation with other burdens such as triennial 
rate review.'' \63\ In other words, the Commission reduced the periodic 
rate review requirement not because it was obligated to do so by the 
undue burden standard, but because the Commission was exercising its 
discretion to lessen pipelines' overall burden of complying with all 
the Commission's various regulatory requirements. We also reject 
Enogex's implication of burden by the fact that there are seventy-five 
data elements. Burden is more properly weighed by the content of the 
data requested. The first eighteen of those data elements, for 
instance, are little more than the company filling out its name and 
contact information; using numerous but smaller data elements is useful 
for making the completed form more amenable to electronic searches.
---------------------------------------------------------------------------

    \62\ Enogex at 19.
    \63\ Order No. 735, FERC Stats. & Regs. ] 31,310 at P 96.
---------------------------------------------------------------------------

    63. Furthermore, as the Commission has explained, its regulatory 
oversight is not merely limited to reviewing rate filings. In order to 
carry out our ``responsibility to ensure rates and charges are fair and 
equitable * * * it is important for rates charged to be reported'' as 
well.\64\ The Commission seeks to empower shippers ``to determine the 
extent to which particular transactions are comparable to one another'' 
\65\ in order to protect themselves from undue discrimination. The 
previous reporting requirements in 18 CFR 284.126, for both 
transportation and storage, were inadequate for providing potential 
shippers with sufficient information to make well informed purchasing 
decisions. We also note that while other parties on rehearing request 
changes to specific elements or argue for special attention to certain 
market sectors, Enogex is alone among all Respondents in arguing that 
filing the new reports would be unduly burdensome. The benefits to the 
functioning of the market, by ensuring transportation and storage 
customers are aware of the actual prices charged just as American 
customers have long come to expect in the retail sector, far outweigh 
Enogex's inchoate claims of undue administrative burden.
---------------------------------------------------------------------------

    \64\ Order No. 581, 60 FR 53019 at 53,050-51; FERC Stats. & 
Regs. at 31,501.
    \65\ NOPR, FERC Stats. & Regs. ] 32,644 at 19.
---------------------------------------------------------------------------

C. Identification of Receipt Points

    64. AOG urges the Commission to amend or clarify Order No. 735's 
requirement, codified at 18 CFR 284.126(b)(1)(iv), that Respondents 
must state the primary receipt points covered by each contract that is 
reported on Form No. 549D. AOG is a small local distribution company 
for a ten-county rural area along the Arkansas-Oklahoma border. Its 
system includes roughly 400 production wells, which ordinarily serve 
AOG's non-jurisdictional distribution customers. When demand is not at 
peak, AOG delivers excess production gas to the interstate markets 
under an Order No. 63 blanket certificate.\66\ AOG states that the 
current

[[Page 80695]]

set-up of its system does not allow it to identify the receipt point of 
each transaction.\67\ AOG argues that even if it could, ``the 
information would be meaningless'' because AOG does not deliver to the 
interstate markets directly; rather, all five of its delivery points 
interconnect with third-party gathering systems that would not be 
covered by the reporting requirements.\68\
---------------------------------------------------------------------------

    \66\ See Arkansas Oklahoma Gas Corp., 33 FERC ] 61,197, at 
61,401-02 (1985) (An Order No. 63 blanket certificate ``permits a 
local distribution company that is served by an interstate pipeline 
* * * to sell and transport gas in interstate commerce under the 
same conditions as apply to those transactions when engaged in by 
intrastate pipelines under sections 311 and 312 of the NGPA.'').
    \67\ AOG's request includes an affidavit from its president 
elaborating on its specific factual circumstances, along with a 
system map.
    \68\ AOG at 9.
---------------------------------------------------------------------------

    65. Because of the high difficulty and limited usefulness of 
tracking receipt points on such a system, AOG recommends that the 
Commission clarify the receipt point reporting requirement. AOG 
requests that:

respondents, such as AOG, who perform basically a gathering service, 
are located in a production area, have hundreds of wells attached to 
their system, deliver only production gas to other gathering 
facilities * * *, and are physically unable to identify a receipt 
point for each transaction be [allowed] to designate `production 
pool' as the receipt point in their quarterly reports.\69\
---------------------------------------------------------------------------

    \69\ AOG at 7.

    66. AOG's request is narrowly tailored to its own circumstances, 
which appear to be quite rare. Accordingly, we find that this request 
does not justify a modification of the generally applicable reporting 
requirements adopted in this rulemaking proceeding. However, AOG may 
re-file its request in a separate docket, and request a case-specific 
waiver of the 18 CFR 284.126(b)(1)(iv) requirement to identify 
individual receipt points based on its own circumstances. While we do 
not anticipate many other pipelines to qualify for waivers, the 
Commission will consider other requests for waiver on a case-by-case 
basis, as the moving party's individual circumstances so warrant.

D. Identification of Shippers

    67. TPA argues that, ``[t]he Commission erred by requiring Section 
311 and Hinshaw pipelines to identify shippers by D-U-N-S number in 
Form No. 549D.'' \70\ TPA claims that the Commission has not explained 
why an identification number is useful, given that pipelines must 
report publicly the names of its shippers.
---------------------------------------------------------------------------

    \70\ TPA at 3, 7.
---------------------------------------------------------------------------

    68. We affirm that ``standardized shipper identification is not 
unduly burdensome in comparison to the benefit to the Commission and 
market participants of being certain of the true identity of a 
pipeline's shippers.'' \71\ For some persons interested in reading Form 
No. 549D data, TPA may be correct that the shipper's full legal name 
will be sufficient. For entities using the data to engage in market 
research, however, a standardized identification number is necessary 
for at least two reasons. First, identification numbers facilitate the 
process of creating reliable, robust databases, which in turn help 
market participants to gain the most value out of the information in 
these public reports. Without standard identification numbers, a small 
typographic change, such as referring to ``Shipper A, LLC'' as 
``Shipper A, L.L.C.,'' could be misinterpreted by a computer system as 
two different entities. Second, identification numbers greatly reduce 
the administrative burden (both to Respondents and to all readers of 
the reports) in the common situation where a shipper changes its legal 
name but is otherwise the same entity. Identification numbers allow for 
data from before and after the shipper's name change to be considered 
properly as part of a continuous set, without the need for the 
Respondent to engage in tedious manual intervention. Accordingly, all 
Respondents are required to use a standard shipper identification 
number for Form No. 549D.
---------------------------------------------------------------------------

    \71\ Order No. 735, FERC Stats. & Regs. ] 31,310 at P 61.
---------------------------------------------------------------------------

    69. TPA also argues that while Respondents ``can ask their shippers 
to obtain D-U-N-S numbers, they have no authority to require them to do 
so and should not be held accountable for a shipper's failure to obtain 
a D-U-N-S number.'' \72\ We disagree. As a general matter, it would be 
fair and equitable for a pipeline to include in its Statement of 
Operating Conditions a requirement that shippers must provide the 
pipeline with information that is necessary in order to comply with any 
state or federal reporting requirements. Currently, assignment of a D-
U-N-S number is free for all entities required to register with the 
federal government by a regulatory agency.\73\ The Commission and the 
North American Energy Standards Board have been requiring shipper D-U-
N-S numbers for years in the Index of Customers without serious 
complaint.\74\
---------------------------------------------------------------------------

    \72\ TPA at 8.
    \73\ See Electric Quarterly Report Submission Software Users 
Guide at 11-12 (January 2008), available at http://www.ferc.gov/docs-filing/eqr/soft-tools/userguide.pdf. See also Dun & Bradstreet 
Web site, http://fedgov.dnb.com/webform.
    \74\ See Instruction Manual for Electronic Filing of the Index 
of Customers, OMB Form No. 1902-0169 at 5 (June 2000), available at 
http://www.ferc.gov/docs-filing/forms/form-549b/elec-inst.pdf.
---------------------------------------------------------------------------

E. Prior Period Adjustment and Inactive Contracts

    70. TPA asks the Commission to clarify how prior period adjustments 
should be reported. Since ``volumetric measurement is an inexact 
science,'' \75\ TPA argues, inevitably pipelines will discover 
measurement errors in prior records of volumes shipped, injected, or 
withdrawn. TPA states that it is not clear how to report these 
adjustments on Form No. 549D. TPA recommends that Respondents should 
report a prior period adjustment as part of the data for the quarter 
when it is discovered rather than revising previously reported data, 
which TPA claims is how pipelines book such adjustments for accounting 
purposes.
---------------------------------------------------------------------------

    \75\ TPA at 9.
---------------------------------------------------------------------------

    71. The Commission clarifies that Form No. 549D reports should 
reflect the data on the billing statements to customers. If a 
pipeline's billing policy for prior period adjustments is to revise the 
prior bill, then that pipeline should resubmit its Form No. 549D for 
that prior quarterly time period. If, however, a pipeline's billing 
policy for prior period adjustments is to bill for the quarter when the 
discrepancy is discovered, as TPA suggests, then that pipeline should 
submit the adjusted data as part of its upcoming report rather than 
revising prior reports. Either way, the Form No. 549D data should match 
the data in the pipeline's own billing systems, so as to reduce the 
pipeline's recordkeeping burden and also to avoid systemic 
discrepancies in the event of an audit. Furthermore, in order to aid 
Respondents who may need to correct a previous Form No. 549D report for 
any reason, the Commission will insert a Field 3A in the report, in 
which Respondents may provide a short explanation of why they are 
resubmitting a prior report.
    72. TPA also requests that the Commission clarify how Respondents 
should handle contracts that were not active during a given quarter. 
TPA cites the appendix to the Final Rule as explaining that ``pipelines 
that did not provide any interstate services to any shipper'' at all 
need only fill out the initial fields in Form No. 549D, and not the 
remainder of the form.\76\ TPA states that it is unclear, however, how 
to respond if ``gas flows under some contracts but not others,'' and

[[Page 80696]]

recommends that pipelines only ``report the contracts where 
[jurisdictional] gas flowed.'' \77\
---------------------------------------------------------------------------

    \76\ TPA at 10.
    \77\ Id.
---------------------------------------------------------------------------

    73. The Commission grants the requested clarification. Respondents 
need not include in their quarterly reports any contracts for which no 
Commission-jurisdictional gas has flowed in that quarter.

F. Semi-Annual Storage Report

    74. Enogex, Jefferson, and TPA all argue that the semi-annual 
storage report (Form No. 537, required by 18 CFR 284.126(c)) will be 
duplicative and burdensome as soon as section 311 and Hinshaw pipelines 
begin reporting on Form No. 549D. They argue that since the Commission 
``will be able to distill all of the relevant information presently 
reported on the existing Form No. 537 from the new Form No. 549D,'' 
\78\ there is ``no justification for'' \79\ collecting ``this 
duplicative storage activity information in dissimilar formats.'' \80\ 
Accordingly, they urge the Commission to eliminate the semi-annual 
storage report.
---------------------------------------------------------------------------

    \78\ TPA at 6.
    \79\ Enogex at 20.
    \80\ Jefferson at 8.
---------------------------------------------------------------------------

    75. While there is substantial overlap between Form No. 537 and 
Form No. 549D, it remains unclear whether the new quarterly report 
renders the semi-annual storage report obsolete. The semi-annual 
storage report collects certain information that the quarterly reports 
do not. This includes the volumes actually injected and withdrawn 
during the injection and withdrawal seasons. In addition, as discussed 
above, the quarterly reports required by this rule will not require 
per-customer revenue data to be reported. Moreover, since the semi-
annual reporting periods are tied to the injection and withdrawal 
season, the time periods covered also do not correspond precisely to 
two Form No. 549D quarterly reports. Thus, we will not eliminate Form 
No. 537 at this time.
    76. However, we find that the Commission should reconsider the 
utility of the semi-annual storage reports for interstate and 
intrastate storage companies. As Enogex, Jefferson, and TPA argue, the 
Commission should seek to eliminate truly duplicative reporting 
requirements. Throughout this rulemaking proceeding, the Commission has 
also sought to standardize and equalize reporting requirements for 
interstate and intrastate providers wherever it is warranted. Thus, any 
consideration of abolishing or reforming the intrastate semi-annual 
storage report should be accompanied by a similar review of the 
interstate semi-annual storage report. Finally, the semi-annual storage 
reports are now anomalous among Commission reports in their 
respondents' liberal use of requests for privileged treatment, which 
has recently led to calls that these reports be made public. 
Accordingly, simultaneously with this order, the Commission is issuing 
a Notice of Inquiry under a separate docket, Docket No. RM11-4-000, to 
explore reforms to the semi-annual storage reporting requirements for 
interstate and intrastate storage companies.

G. Effective Date and Technical Workshop

    77. Jefferson argues on rehearing that the Commission should delay 
the effective date of Order No. 735 from April 1, 2011 until October 1, 
2011. Jefferson also requests that the Commission hold a technical 
workshop at least 6 months before the effective date, and post the XML 
Schema as soon as possible. Jefferson argues that since the Commission 
has not yet posted a version of the XML Schema that is compatible for 
electronic submission, it cannot yet determine the procedures that it 
will use to collect data and compile its first report.
    78. The draft revisions to Form No. 549D \81\ are being submitted 
to OMB for review and approval. Above in this order, we have pushed 
back the due date of the first quarterly report under the new 
regulations from May 1, 2011 to June 1, 2011. A print only version of 
the PDF form is provided in the Appendix to this order, and Commission 
Staff will post the XML Schema and fillable PDF to the FERC website as 
soon as available and permitted by OMB. We consider this to be 
sufficient advance notice, considering that Jefferson is the only 
pipeline to have expressed concern on rehearing that the effective date 
is too soon. We also direct Commission Staff to hold a technical 
workshop on issues of implementation, the time and date of which will 
be announced in a separate notice in this docket after we receive OMB 
approval of the revised Form No. 549D.\82\
---------------------------------------------------------------------------

    \81\ The previous Form No. 549D was approved under OMB Control 
No. 1902-0253.
    \82\ The technical workshop shall be to discuss implementation 
of the draft reporting requirements. The technical workshop will not 
address legal or policy issues that are more appropriately raised 
through requests for rehearing or clarification, including any 
changes to the form, instructions, and definitions that would 
require OMB approval, nor will it address the semi-annual storage 
reports.
---------------------------------------------------------------------------

III. Information Collection Statement

    79. OMB regulations require that OMB approve certain reporting, 
recordkeeping, and public disclosure (collections of information) 
imposed by an agency.\83\ The information collection requirements 
included in Commission Order No. 735 for Form No. 549D were approved 
under OMB Control No. 1902-0253. This order further revises the 
requirements in order to retract the increased requirements for 
contract end dates and per-customer revenue, to more clearly state the 
obligations imposed in Order No. 735, and to extend the reporting 
deadlines. Because the Commission has made ``substantive or material 
modifications'' to the information collection requirement, we will 
submit Form No. 549D to OMB for review and approval under the Paperwork 
Reduction Act.\84\
---------------------------------------------------------------------------

    \83\ 5 CFR 1320.
    \84\ See 44 U.S.C. 3507(h)(3).
---------------------------------------------------------------------------

    80. The Commission identifies the information provided under Part 
284 as contained in FERC Form No. 549D. The Commission solicited 
comments on the need for this information, whether the information 
would provide useful transparency, ways to enhance the quality, 
utility, and clarity of the information to be collected, and any 
suggested methods for minimizing Respondents' burden. Where commenters 
raised concerns that information collection requirements would be 
burdensome to implement, the Commission has addressed those concerns 
above in this order. The Commission does not change its burden estimate 
from that provided in Order No. 735.\85\
---------------------------------------------------------------------------

    \85\ See Order No. 735, FERC Stats. & Regs. ] 31,310 at P 106-
108.
---------------------------------------------------------------------------

    81. Interested persons may obtain information on the reporting 
requirements by contacting the following: Federal Energy Regulatory 
Commission, 888 First Street, NE., Washington, DC 20426 [Attention: 
Ellen Brown, Office of the Executive Director], e-mail: 
DataClearance@ferc.gov, Phone: (202) 502-8663, Fax: (202) 273-0873. For 
submitting comments concerning the collection of information, please 
send your comments to the Commission and to: Office of Information and 
Regulatory Affairs, Office of Management and Budget, 725 17th Street, 
NW., Washington, DC 20503, [Attention: Desk Officer for the Federal 
Energy Regulatory Commission] Phone: (202) 395-4638, Fax: (202) 395-
7285. Due to security concerns, comments should be sent electronically 
to OMB at the following e-mail address: oira_submission@omb.eop.gov. 
Please

[[Page 80697]]

reference OMB Control No. 1902-0253 and the docket number of this order 
in your submission.

IV. Environmental Analysis

    82. The Commission is required to prepare an Environmental 
Assessment or an Environmental Impact Statement for any action that may 
have a significant adverse effect on the human environment.\86\ The 
Commission has categorically excluded certain actions from these 
requirements as not having a significant effect on the human 
environment.\87\ The actions taken here fall within categorical 
exclusions in the Commission's regulations for rules that are 
corrective; clarifying or procedural; for information gathering, 
analysis, and dissemination; and for sales, exchange, and 
transportation of natural gas that requires no construction of 
facilities.\88\ Therefore an environmental review is unnecessary and 
has not been prepared in this rulemaking.
---------------------------------------------------------------------------

    \86\ Order No. 486, Regulations Implementing the National 
Environmental Policy Act, 52 FR 47897 (Dec. 17, 1987), FERC Stats. & 
Regs. ] 30,783 (1987).
    \87\ 18 CFR 380.4.
    \88\ See 18 CFR 380.4(a)(2)(ii), 380.4(a)(5), and 380.4(a)(27).
---------------------------------------------------------------------------

V. Regulatory Flexibility Act

    83. The Regulatory Flexibility Act of 1980 (RFA) \89\ generally 
requires a description and analysis of final rules that will have 
significant economic impact on a substantial number of small entities. 
The Commission is not required to make such analysis if proposed 
regulations would not have such an effect. For the reasons stated in 
Order No. 735,\90\ the Commission certifies that this Final Rule's 
amendments to the regulations will not have a significant impact on a 
substantial number of small entities.
---------------------------------------------------------------------------

    \89\ 5 U.S.C. 601-612.
    \90\ See Order No. 735, FERC Stats. & Regs. ] 31,310 at P 111.
---------------------------------------------------------------------------

VI. Document Availability

    84. In addition to publishing the full text of this document in the 
Federal Register, except for the Appendix, the Commission provides all 
interested persons an opportunity to view and/or print the contents of 
this document, including the Appendix, via the Internet through FERC's 
Home Page (http://www.ferc.gov) and in FERC's Public Reference Room 
during normal business hours (8:30 a.m. to 5 p.m. Eastern time) at 888 
First Street, NE., Room 2A, Washington DC 20426.
    85. From FERC's Home Page on the Internet, this information is 
available on eLibrary. The full text of this document is available on 
eLibrary in PDF and Microsoft Word format for viewing, printing, and/or 
downloading. To access this document in eLibrary, type the docket 
number excluding the last three digits of this document in the docket 
number field. The report and instructions also will be made available 
through the Commission's Forms page, http://www.ferc.gov/docs-filing/forms.asp, upon approval by OMB.
    86. User assistance is available for eLibrary and the FERC's Web 
site during normal business hours from FERC Online Support at 202-502-
6652 (toll free at 1-866-208-3676) or e-mail at 
ferconlinesupport@ferc.gov, or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. E-mail the Public Reference Room at 
public.referenceroom@ferc.gov.

VII. Effective Date

    87. These further revisions to the reporting regulations will be 
effective April 1, 2011, the same date as in the Final Rule. The 
quarterly report for transactions occurring during the period January 
1, 2011 through March 31, 2011, must be filed on or before June 1, 
2011. 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 in 18 CFR Part 284

    Continental shelf, Natural gas, Reporting and recordkeeping 
requirements.

    By the Commission.
Nathaniel J. Davis, Sr.,
Deputy Secretary.

0
In consideration of the foregoing, the Commission amends part 284, 
Chapter I, Title 18, Code of Federal Regulations, as amended at 75 FR 
29404 on May 26, 2010, as follows.

PART 284--CERTAIN SALES AND TRANSPORTATION OF NATURAL GAS UNDER THE 
NATURAL GAS POLICY ACT OF 1978 AND RELATED AUTHORITIES

0
1. The authority citation for part 284 continues to read as follows:

    Authority:  15 U.S.C. 717-717w, 3301-3432; 42 U.S.C. 7101-7352; 
43 U.S.C. 1331-1356.


0
2. In Sec.  284.126, as amended at 75 FR 29419 on May 26, 2010, 
paragraphs (b)(1)(vi), (b)(1)(viii), and (b)(2) are revised to read as 
follows:


Sec.  284.126  Reporting requirements.

* * * * *
    (b) * * *
    (1) * * *
    (vi) The duration of the contract, specifying the beginning and 
(for firm contracts only) ending month and year of the current 
agreement;
* * * * *
    (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.
    (2) The quarterly Form No. 549D report for the period January 1 
through March 31 must be filed on or before June 1. The quarterly 
report for the period April 1 through June 30 must be filed on or 
before September 1. The quarterly report for the period July 1 through 
September 30 must be filed on or before December 1. The quarterly 
report for the period October 1 through December 31 must be filed on or 
before March 1.
* * * * *
[FR Doc. 2010-32112 Filed 12-22-10; 8:45 am]
BILLING CODE 6717-01-P


