Proposed Rule: Standards of Conduct: Natural Gas Pipeline Transmission Providers

3958 Federal Register / Vol. 72, No.
18 / Monday, January 29, 2007 / Proposed Rules
The Proposed Amendment § 39.13 [Amended] Affected ADs

Accordingly, under the authority 2. The Federal Aviation (b) None.
delegated to me by the Administrator, Administration (FAA) amends § 39.13 Applicability
the FAA proposes to amend 14 CFR part by adding the following new
39 as follows: (c) This AD applies to Boeing Model 777–
airworthiness directive (AD): 200, –300, and –300ER series airplanes,
PART 39—AIRWORTHINESS Boeing: Docket No. FAA–2007–27042; certificated in any category; as identified in
DIRECTIVES Directorate Identifier 2006–NM–225–AD. the service bulletins specified in Table 1 of
this AD.
1. The authority citation for part 39 Comments Due Date
continues to read as follows: (a) The FAA must receive comments on
Authority: 49 U.S.C. 106(g), 40113, 44701. this AD action by March 15, 2007.
TABLE 1.—SERVICE BULLETINS

Boeing Alert Service Bulletin— Revision level— Dated—
777–57A0050 ............................................................................................................................................ Original ............. January 26, 2006.

777–57A0051 ............................................................................................................................................ Original ............. May 15, 2006.
777–57A0057 ............................................................................................................................................ Original ............. August 7, 2006.
Note 1: Although Alert Service Bulletin Issued in Renton, Washington, on January transmission providers and their energy
777–57A0050 refers to ‘‘Model 777–200ER’’ 18, 2007. affiliates. Also, the Commission is
airplanes, this is a European designation that Ali Bahrami, proposing to: revise the definition of
does not apply to airplanes of U.S. registry. Manager, Transport Airplane Directorate, marketing, sales or brokering; make
Therefore, the applicability of this AD will Aircraft Certification Service. permanent the changes adopted in the
not specify Model 777–200ER airplanes. [FR Doc. E7–1321 Filed 1–26–07; 8:45 am] interim rule for risk management
However, U.S. operators should take any employees and discretionary waivers;
BILLING CODE 4910–13–P
reference to Model 777–200ER airplanes in
remove the regulations that permit the
Alert Service Bulletin 777–57A0050 as
transmission provider to share
applicable to Model 777–200 airplanes as
designated by the type certificate data sheet. DEPARTMENT OF ENERGY information necessary to maintain the
operations of its transmission system
Unsafe Condition Federal Energy Regulatory with its energy affiliates; add and revise
(d) This AD results from fuel system Commission various regulations to facilitate
reviews conducted by the manufacturer. We integrated resource planning and
are issuing this AD to prevent electrical 18 CFR Part 358 competitive solicitations; revise the
arcing on the fuel tank boundary structure or [Docket No. RM07–1–000]
regulations to require each transmission
inside the main and center fuel tanks, which provider to post the name of its chief
could result in a fire or explosion. Standards of Conduct for compliance officer, to delete outdated
Transmission Providers references, and to require that
Compliance
transmission provider employees certify
(e) You are responsible for having the January 18, 2007. that they have completed standards of
actions required by this AD performed within AGENCY: Federal Energy Regulatory conduct training; and, revise the
the compliance times specified, unless the Commission; DOE. definition of affiliate regarding exempt
actions have already been done. wholesale generators.
ACTION: Notice of Proposed Rulemaking.
Corrective Actions DATES: Comments must be filed on or
SUMMARY: The purpose of this Notice of
(f) Within 60 months after the effective before March 15, 2007. Reply comments
date of this AD, install Teflon sleeving under
Proposed Rulemaking is to propose must be filed on or before April 4, 2007.
the clamps of the wire bundles routed along permanent regulations regarding the
standards of conduct consistent with the ADDRESSES: You may submit comments
the fuel tank boundary structure, and cap identified by Docket No. RM07–1–000,
seal certain penetrating fasteners of the fuel decision of the United States Court of
Appeals of the District of Columbia in by one of the following methods:
tanks as applicable, in accordance with the
Accomplishment Instructions of the National Fuel Gas Supply Corporation • Agency Web Site: http://ferc.gov.
applicable service bulletins specified in v. FERC, 468 F.3d 831 (2006), regarding Follow the instructions for submitting
Table 1 of this AD. natural gas pipelines. On January 9, comments via the eFiling link found in
2007, the Commission issued an interim the Comment Procedures Section of the
Alternative Methods of Compliance preamble.
(AMOCs) rule regarding the standards of conduct
in response to the court’s decision. The • Mail: Commenters unable to file
(g)(1) The Manager, Seattle Aircraft Commission is soliciting comments comments electronically must mail or
Certification Office, FAA, has the authority to hand deliver an original and 14 copies
regarding whether or not the interim
approve AMOCs for this AD, if requested in of their comments to the Federal Energy
accordance with the procedures found in 14
rule should be made permanent for
natural gas transmission providers. The Regulatory Commission, Office of the
rmajette on PROD1PC67 with PROPOSALS
CFR 39.19. Secretary, 888 First Street, NE.,

(2) Before using any AMOC approved in Commission is also soliciting comments
regarding comparable changes for Washington, DC 20426. Please refer to
accordance with § 39.19 on any airplane to
which the AMOC applies, notify the electric utility transmission providers: the Comment Procedures Section of the
appropriate principal inspector in the FAA specifically, whether or not the preamble for additional information on
Flight Standards Certificate Holding District standards of conduct should govern the how to file paper comments.
Office. relationship between electric utility FOR FURTHER INFORMATION CONTACT:
VerDate Aug<31>2005 14:38 Jan 26, 2007 Jkt 211001 PO 00000 Frm 00003 Fmt 4702 Sfmt 4702 E:\FR\FM\29JAP1.SGM 29JAP1
Federal Register / Vol. 72, No. 18 / Monday, January 29, 2007 / Proposed Rules 3959
Eric Ciccoretti, Office of Enforcement, this, the court found moot the other references, and to require that
Federal Energy Regulatory issues raised on appeal.4 transmission provider employees certify
Commission, 888 First Street, NE., 2. On January 9, 2007, the that they have completed standards of
Washington, DC 20426, Telephone: Commission issued an interim rule that conduct training; and (6) revise the
(202) 502–8493, E-mail: promulgated temporary regulations definition of affiliate regarding exempt
eric.ciccoretti@ferc.gov. consistent with the court’s decision, but wholesale generators at § 358.3(b)(2) of
Deme Anas, Office of Enforcement, designed to prevent a regulatory gap the Commission’s regulations.
Federal Energy Regulatory with respect to standards of conduct for
Commission, 888 First Street, NE., natural gas transmission providers and A. Order No. 2004
Washington, DC 20426, Telephone: their marketing affiliates.5 The purpose 4. Prior to Order No. 2004, the
(202) 502–8178, E-mail: of this Notice of Proposed Rulemaking Commission had two separate sets of
demetra.anas@ferc.gov. (NOPR) is to propose permanent regulations governing standards of
Stuart Fischer, Office of Enforcement, regulations consistent with the court’s conduct for transmission providers. The
Federal Energy Regulatory decision regarding natural gas pipelines. regulations applicable to natural gas
Commission, 888 First Street, NE., The Commission is also soliciting pipelines were issued in Order No. 497
Washington, DC 20426, Telephone: comments regarding whether or not to in 1988,6 under sections 4 and 5 of the
(202) 502–8517, E-mail: make comparable changes for electric Natural Gas Act.7 In 1996, the
stuart.fischer@ferc.gov. utility transmission providers. With Commission issued Order No. 889,8
SUPPLEMENTARY INFORMATION: respect to both industries, the which created standards of conduct
Commission seeks evidence regarding regulations applicable to electric
I. Introduction the scope of the rules, including utilities under sections 205 and 206 of
1. The Federal Energy Regulatory application of the rules to energy the Federal Power Act.9 Both rules had
Commission (Commission) is proposing affiliates. This issuance will provide a the same goal—to prevent transmission
to adopt standards of conduct forum to develop the appropriate record providers from wielding their market
regulations that govern the relationship for any future action. Moreover, because power over transmission to give undue
between natural gas transmission we are initiating a rulemaking preference or unduly discriminatory
providers and their marketing affiliates proceeding, the Commission also takes treatment in favor of their marketing
in light of the decision of the United this opportunity to propose additional affiliates over non-affiliates. Both rules
States Court of Appeals for the District changes to the standards of conduct, employed the same general approach,
of Columbia Circuit concerning the including, among other things, e.g., requiring employees engaged in
standards of conduct for transmission proposing provisions to facilitate transmission services to function
providers under Order No. 2004.1 In integrated resource planning and independently from employees of its
National Fuel Gas Supply Corporation competitive solicitations for electric marketing affiliates and imposing
v. FERC (National Fuel),2 the court utility transmission providers. prohibitions restricting transmission
determined that the Commission did not 3. In this NOPR, the Commission providers from sharing certain
support the standards of conduct’s proposes to make permanent the interim information with their marketing
definition of energy affiliate and vacated regulations that made the standards of affiliates. The rules were designed to
Order Nos. 2004, 2004–A, 2004–B, conduct inapplicable to the relationship ensure that affiliated and non-affiliated
2004–C and 2004–D (collectively between natural gas pipeline transmission customers were treated on
referred to as Order No. 2004) as applied transmission providers and their energy an equal basis. However, the standards
to natural gas pipelines and remanded affiliates. The Commission also of conduct under Order Nos. 497 and
the orders to the Commission.3 proposes to: (1) To revise the definition 889 contained some differences,
Specifically, the court rejected the of marketing, sales or brokering at particularly with respect to the
Commission’s attempt to extend the § 358.3(e) of the Commission’s
standards of conduct beyond pipelines’ regulations; (2) make permanent the 6 Inquiry Into Alleged Anticompetitive Practices
changes adopted in the interim rule for Related to Marketing Affiliates of Interstate
relationships with their marketing Pipelines, Order No. 497, 53 FR 22139 (1988), FERC
affiliates to also govern pipelines’ § 358.4(a)(6) of the Commission’s Stats. & Regs., Regulations Preambles 1986–1990
relationships with numerous non- regulations regarding risk management ¶ 30,820 (1988); Order No. 497–A, order on reh’g,
marketing affiliates, such as producers, employees and §§ 358.5(c)(4)(i) and (ii) 54 FR 52781 (1989), FERC Stats & Regs.,
of the Commission’s regulations Regulations Preambles 1986–1990 ¶ 30,868 (1989);
gatherers, and local distribution Order No. 497–B, order extending sunset date, 55
companies (energy affiliates). In light of regarding discretionary waivers; (3) FR 53291 (1990), FERC Stats. & Regs., Regulations
remove § 358.5(b)(8) of the Preambles 1986–1990 ¶ 30,908 (1990); Order No.
1 On November 25, 2003, the Commission added Commission’s regulations, which 497–C, order extending sunset date, 57 FR 9 (1992),
Part 358 to the regulations adopting standards of permits the transmission provider to FERC Stats. & Regs., Regulations Preambles 1991–
conduct that apply uniformly to natural gas and 1996 ¶ 30,934 (1991), reh’g denied, 57 FR 5815
electric utility transmission providers. Standards of
share information necessary to maintain (1992), 58 FERC ¶ 61,139 (1992); aff’d in part and
Conduct for Transmission Providers, Order No. the operations of its transmission remanded in part sub nom. Tenneco Gas v. FERC,
2004, FERC Stats. & Regs., Regulations Preambles system with its energy affiliates; (4) add 969 F.2d 1187 (D.C. Cir. 1992).
2001–2005 ¶ 31,155 (2003), order on reh’g, Order and revise various sections to facilitate 7 15 U.S.C. 717c and 717d; see also former 18 CFR
No. 2004–A, FERC Stats. & Regs., Regulations part 161 (2003).
Preambles 2001–2005 ¶ 31,161 (2004), order on
integrated resource planning and 8 Open Access Same-Time Information System
reh’g, Order No. 2004–B, FERC Stats. & Regs., competitive solicitations; (5) revise (Formerly Real-Time Information Network) and
Regulations Preambles 2001–2005 ¶ 31,166 (2004), § 358.4(e) of the Commission’s Standards of Conduct, Order No. 889, 61 FR 21737
order on reh’g, Order No. 2004–C, FERC Stats. & regulations to require each transmission (May 10, 1996), FERC Stats. & Regs., Regulations
Regs., Regulations Preambles 2001–2005 ¶ 31,172, Preambles Jan. 1991–June 1996 ¶ 31,035 (Apr. 24,
order on reh’g, Order No. 2004–D, 110 FERC
provider to post the name of its chief
1996); Order No. 889–A, order on reh’g, 62 FR
¶ 61,320 (2005), remanded as it applies to natural compliance officer, to delete outdated 12484 (Mar. 14, 1997), FERC Stats. & Regs.,
gas pipelines, National Fuel Gas Supply Regulations Preambles 1996–2000 ¶ 31,049 (Mar. 4,
Corporation v. FERC, 468 F.3d 831, (D.C. Cir. Nov. 4 Id. 1997); Order No. 889–B, reh’g denied, 62 FR 64715
17, 2006). 5 Standards of Conduct for Transmission (Dec. 9, 1997), 81 FERC ¶ 61,253 (Nov. 25, 1997).
2 National Fuel, slip op. at 4.
Providers, Order No. 690, 72 FR 2427 (Jan. 19, 9 16 U.S.C. 824d and 824e; see also former 18 CFR
3 Id. 2007); FERC Stats. & Regs. ¶ 31,327 (Jan. 9, 2007). 37.4 (2003).
3960 Federal Register / Vol. 72, No. 18 / Monday, January 29, 2007 / Proposed Rules
information sharing prohibitions and record evidence did not withstand natural gas transmission providers. We
posting requirements. scrutiny and, thus, concluded the seek comment on whether this is
5. In Order No. 2004, the Commission expansion was arbitrary and capricious sufficient to protect customers.
revised the standards of conduct so that in violation of the Administrative 11. The Commission also is seeking
one set of regulations applied uniformly Procedure Act.14 The court vacated comment on the current restrictions
to both natural gas and electric utility Order No. 2004 as applicable to natural relating to energy affiliates of electric
transmission providers and their gas pipelines. In light of this utility transmission providers. The court
affiliates.10 In doing so, the Commission disposition, the court did not address in National Fuel did not address this
noted several reasons for issuing new the other four issues raised on appeal issue because electric utility
standards of conduct.11 In Order No. regarding Order No. 2004. transmission providers did not appeal
2004, the Commission also expanded Order No. 2004. However, the
the coverage of the standards of conduct II. Discussion Commission believes it is important to
to govern the relationships between 8. The NOPR proposes to make address the issue here.
transmission providers and energy changes to Part 358 (discussed in greater 12. The Commission has reviewed the
affiliates.12 Previously, the standards of detail below) consistent with National existing regulations, the rationale for
conduct governed the relationships Fuel, seeks comment on other issues, promulgating them, and other
between transmission providers and and clarifies that waivers or exemptions modifications being discussed herein
their marketing affiliates.13 that the Commission issued under Order concerning whether or not to eliminate
No. 2004 remain valid and are not the restrictions on energy affiliates of
B. Matters Appealed negatively impacted by the National electric utility transmission providers. If
6. Five issues were appealed from Fuel decision. we were to eliminate these restrictions,
Order No. 2004: (1) The extension of the the non-marketing energy affiliates of
standards of conduct to cover the A. Partially Repromulgating Part 358 electric transmission providers would
relationship between natural gas 9. Order No. 2004 codified many case- no longer be subject to the standards of
transmission providers and their energy by-case exceptions that had evolved conduct. However, since we have not
affiliates under § 358.3(d); (2) the scope during the implementation of Order yet received comments on the issue or
of the restrictions on sharing risk Nos. 497 and 889. These provisions engaged in outreach, this NOPR does
management employees between natural included: codifying exceptions to the not suggest regulatory text on this issue.
gas pipeline transmission providers and independent functioning requirement;15 We intend to carefully examine any
their marketing/energy affiliates under revising information sharing comments received on this issue and
§ 358.4(a)(6); (3) the scope of the prohibitions to reflect practical weigh them heavily in our deliberations
restrictions on sharing lawyers between considerations 16 and emergency on a Final Rule.
natural gas pipeline transmission circumstances;17 codifying a training 13. When the Commission adopted
providers and their marketing/energy requirement;18 revising and imposing the definition of energy affiliate in
affiliates; (4) the scope of the new posting requirements to improve Order No. 2004, the Commission
requirement for natural gas pipeline transparency;19 and requiring focused most closely on examples of the
transmission providers to post all transmission providers to designate a potential for undue discrimination in
discretionary acts under § 358.5(c)(4); chief compliance officer.20 The NOPR favor of energy affiliates of natural gas
and (5) the timing as to when newly proposes to re-adopt those sections of pipelines, rather than of electric utility
certificated pipelines become subject to Part 358 that were not appealed and not transmission providers.22 Although the
the standards of conduct. found infirm in National Fuel. Commission noted certain violations of
Order No. 889 by electric utility
C. The Court’s Decision B. The Definition of Energy Affiliates transmission providers,23 these
7. In National Fuel, the court vacated 10. Because the court’s decision instances involved undue preferences
Order No. 2004 as applicable to natural focused on the Commission’s lack of given to an electric transmission
gas pipelines because of the expansion evidence to support expanding the provider’s merchant function. As we
of the standards of conduct to include standards of conduct to govern the discuss further below, the definition of
energy affiliates. The court explained relationship between natural gas marketing affiliate expressly includes an
that the Commission relied on both transmission providers and their non- electric transmission provider’s
theoretical grounds and on record marketing affiliates, the interim rule merchant function and the Commission
evidence to justify this expansion. The added a new provision stating that the sees no reason to delete that important
court concluded that the Commission’s standards of conduct do not govern the protection.24 Furthermore, in an area
relationship between natural gas where the Commission made findings of
10 18 CFR 358.3(a)(1) and (2) (definition of
transmission providers and their energy undue discrimination that was not
transmission provider). affiliates.21 In this NOPR, consistent covered by Order No. 889—undue
11 Order No. 2004 at P 6–15.
12 Section 358.3(d) defined energy affiliate as any
with the court’s decision, the preferences given to asset managers—we
affiliate which is engaged or involved in Commission proposes to retain this are proposing, as discussed below, to
transmission transactions; manages or controls provision on a permanent basis for broaden the definition of marketing
pipeline capacity; buys, sells, trades or administers affiliate so that the standards of conduct
natural gas or electric energy in domestic energy or 14 National Fuel, slip op. at 4. explicitly prohibit such undue
transmission markets; and engages in financial
transactions relating to the sale or transmission of
15 18 CFR 358.4. preferences.
16 18 CFR 358.5(b)(6) and (8).
natural gas or electric energy in such markets. 18 14. Over the past three years, the
17 18 CFR 358.4(a)(2).
Commission has engaged in extensive
CFR 358.3(d).
18 18 CFR 358.4(e)(5).
13 Under Order No. 497, marketing included
19 18 CFR 358.5(a) and (b).
outreach and consultation with the
affiliates and business divisions engaged in making industry regarding the standards of
20 18 CFR 358.4(e)(6).
sales for resale of natural gas in interstate commerce
(former 18 CFR 161.2(c)); and under Order No. 889, 21 Interim 18 CFR 358.1(e) states: ‘‘The Standards
22 OrderNo. 2004 at P 10–11.
marketing covered affiliates and business divisions of Conduct in this part do not govern the
23 OrderNo. 2004 at P 14.
engaged in making sales for resale of electric energy relationship between a natural gas Transmission
in interstate commerce (former 18 CFR 37.3(e)). Provider and its energy affiliates.’’ 24 18 CFR 358.3(c)(2).
conduct. This outreach has included e. Affiliated entities that aggregate and absent the standards of conduct
three public technical conferences (held re-sell transmission capacity without regulations promulgated under that
in Houston, Chicago, and Scottsdale, making sales for resales of energy; 28 authority, the Commission has the
Arizona) and numerous meetings f. Affiliated electric LDCs; 29 authority to prevent and remedy a
between industry participants and our g. Affiliated electronic trading transmission provider’s undue
staff. Over the course of this outreach, platforms; 30 and, preference or advantage granted in favor
we have received information and h. Affiliated entities that buy, trade or of its affiliates. If a transmission
comments on many important issues administer electric energy.31 provider provides an undue preference
arising under the standards of conduct. The Commission seeks comments on or advantage in favor of an affiliate that
However, this outreach did not cover whether the standards of conduct is not covered by the standards of
the issue addressed here—energy should continue to apply to these conduct, that undue preference may still
affiliate restrictions for electric utility relationships. be prohibited by the Natural Gas Act or
transmission providers. Accordingly, 16. In addition, the Commission seeks Federal Power Act.
the Commission seeks comment on comment, particularly from companies 18. We are not disturbing the
whether applying the standards of subject to both sets of standards, on fundamental protections to consumers
conduct to the relationship between whether it is desirable to maintain and competitors of electric transmission
electric utility transmission providers consistency between the standards of providers that were adopted in Order
and their marketing affiliates, but not to conduct applicable to natural gas No. 889 and retained in Order No. 2004.
their energy affiliates would be transmission providers and electric It will continue to be unlawful for
sufficient to protect customers. utility transmission providers. We note electric utility transmission providers to
Commenters who believe that it is that retaining the energy affiliate provide any undue preference to their
appropriate to retain the standards of restriction for electric transmission merchant function or any affiliate that
conduct for the relationship between providers, but not for natural gas owns generation or sells electricity.
electric utility transmission providers transmission providers, would create, These are the core protections that
and their energy affiliates should submit for some companies, inconsistent rules customers and competitors have long
evidence to support continued for different subsidiaries within a supported and that we retain here. It
application of the definition of energy holding company. For example, an also will continue to be unlawful for
affiliates to electric utility transmission energy affiliate of an electric utility electric transmission providers to
providers. Commenters who believe that transmission provider would be provide any undue preference to an
we should not apply the standards of restricted in communicating with that affiliate selling or trading natural gas.
conduct to the relationship between transmission provider, but if a natural Each of these protections is covered
electric utility transmission providers gas transmission provider owned that explicitly by the definition of marketing
and their energy affiliates should same energy affiliate there would be no affiliate and is left undisturbed.
provide support for their position that such restriction. Similarly, if a holding
C. Revising the Definition of Marketing,
customers will be sufficiently protected company owned both electric utility
Sales or Brokering
from undue discrimination. and natural gas transmission providers,
two differing sets of rules would apply 19. The interim rule adopted a
15. Commenters should include a temporary regulation for natural gas
within the same holding company
focus on the type of energy affiliate that pipeline transmission providers at
system. The electric transmission
they are discussing. Making the § 358.3(l) that mirrored the exceptions
provider would be precluded from
standards of conduct inapplicable to to the definition of marketing that were
dealing with all energy affiliates in that
electric utility transmission providers found in Order No. 497.33 Accordingly,
system, whereas the natural gas pipeline
and their energy affiliates would affect marketing means a sale of natural gas to
company would not. Uniformity could
the relationship between a transmission any person or entity by a seller that is
lessen the compliance burden on the
provider and the following types of non- not an interstate pipeline, except when:
industry and ease oversight of
marketing energy affiliates (except as (1) The seller is selling gas solely from
compliance by the Commission staff,
otherwise noted): its own production; (2) the seller is
but the Commission recognizes that
a. Affiliated asset managers; 25 uniformity does not override the selling gas solely from its own gathering
b. Affiliated transmission customers Commission’s mandate for customer or processing facilities; or (3) the seller
that do not make sales for resale; 26 protection. is an intrastate natural gas pipeline or a
17. Under the Natural Gas Act and the local distribution company making an
c. Affiliated gas entities, e.g., affiliated on-system sale. The NOPR proposes to
Federal Power Act, the Commission has
producers, affiliated gatherers, affiliated remove the interim regulation codified
the statutory mandate to prevent and
gas Local Distribution Companies at § 358.3(l) and incorporate those
remedy undue discrimination.32 Even
(LDCs), and affiliated intrastate
pipelines; 28 See 18 CFR 358.3(d)(1). jurisdiction. Similarly, under sections 205 and 206
d. Affiliated financial institutions that 29 See 18 CFR 358.3(d)(5); Order No. 2004–C at P of the Federal Power Act, 16 U.S.C. 824d and 824e,
24–25. no public utility shall make or grant an undue
do not engage in physical transactions, preference with respect to any transmission or sale
30 See 18 CFR 358.3(d)(1); Order No. 2004–A at
but only financial transactions; 27 subject to the Commission’s jurisdiction.
P 4.
33 Interim 18 CFR 358.3(l) states:
31 See 18 CFR 358.3(d)(3) (‘‘buys, sells, trades or
25 See 18 CFR 358.3(d)(1) (‘‘involved in
administers electric energy’’). The Commission Marketing or brokering means a sale of natural gas
transmission transactions’’). Below, the believes that the relationship with affiliates that to any person or entity by a seller that is not an
interstate pipeline, except when:
Commission proposes to separately make the make wholesale sales of electric energy in interstate
relationship between transmission providers and commerce is governed by the definition of (1) the seller is selling gas solely from its own
asset managers subject to the standards of conduct marketing. See 18 CFR 358.3(k). production;
by expanding the definition of marketing affiliate. 32 Sections 4 and 5 of the Natural Gas Act, 15 (2) The seller is selling gas solely from its own
26 See 18 CFR 358.3(d)(1) (‘‘engages in * * * gathering or processing facilities; or
U.S.C. 717c and 717e, state that no natural gas
transmission transactions’’); Order No. 2004–A at P company shall make or grant an undue preference (3) The seller is an intrastate natural gas pipeline
44. or advantage with respect to any transportation or or a local distribution company making an on-
27 See 18 CFR 358.3(d)(4). sale of natural gas subject to the Commission’s system sale.
exceptions in the definition of The Commission is proposing to include 22. The Commission believes that the
‘‘Marketing, sales or brokering’’ for asset managers/agents within the standards of conduct should govern the
natural gas transmission providers definition of marketing based on relationship between transmission
currently located at § 358.3(e). information gathered during providers and their affiliated asset
20. The electric utility and natural gas investigations by the Commission’s managers. It would likely be unduly
industries differ in certain respects that Enforcement staff. In each of these discriminatory to permit a transmission
are relevant to the energy affiliate issue. matters, staff investigated, among other provider to inform its affiliated asset
The Commission is proposing, issues, asset managers/agents that were manager about an upcoming curtailment
consistent with the National Fuel also marketing affiliates and whether or outage, unless all other non-affiliated
decision, to revise the definition of the asset managers received an undue asset managers or transmission
marketing affiliate to include certain preference from their affiliated customers have comparable access to
exceptions that were adopted in Order transmission providers. All of these that information. Including affiliated
No. 497, but deleted in Order No. 2004. matters concluded with settlements asset managers/agents in the definition
These exceptions would remove approved by the Commission, including of marketing would ensure that all asset
standards of conduct restrictions for a the payment by American Electric managers are treated in a comparable
natural gas pipeline with respect to an Power Company, Inc. (AEP) of $21 fashion. The Commission is soliciting
affiliate’s sales of gas from its own million, the largest civil penalty in comments on whether to include this
production, gathering or processing Commission history,36 and the payment provision in the definition of marketing
facilities. However, sales of electricity by Cleco Corporation of the largest civil and encourages commenters to identify
from a transmission provider’s own penalty under section 214 of the Federal potential harm of including or not
‘‘production’’ facilities—i.e., the including asset managers/agents in the
Power Act.37 The third settlement,
generating plants operated by its definition of marketing. For that
involving South Carolina Electric and
merchant function—were already purpose, proposed § 358.3(e) reads as
Gas Company (SCEG), resulted in SCEG
covered in Order No. 889 and, hence, follows:
agreeing to a compliance plan.38
Order No. 2004 did not represent a
change in this regard. Thus, we do not Because these investigations were Marketing, sales or brokering means a sale
resolved by settlements, the for resale of natural gas or electric energy in
propose to disturb this longstanding interstate commerce in U.S. energy or
customer protection, and will therefore Commission never made any specific
findings that asset managers/agents and transmission markets. Marketing also
retain the Order No. 2004 definition of includes managing or controlling
marketing affiliate that explicitly covers their affiliates engaged in undue transmission capacity of a third-party as an
an electric utility transmission discrimination. Still, the activities asset manager or agent.
provider’s merchant function. We also identified by staff provide a sufficient (1) A sales and marketing employee or unit
note that the gathering and processing basis for the Commission to propose to includes:
include asset managers/agents in the (i) An interstate natural gas pipeline’s sales
exceptions are also inapplicable to
definition of marketing affiliates. That is operating unit, to the extent provided in
electric utility transmission providers § 284.286 of this chapter, and
and, hence, require no comparable the case even though the settled
(ii) An electric public utility Transmission
change. We seek comment on these investigations involved asset managers Provider’s energy sales unit, unless such unit
revised definitions of marketing affiliate who were also marketing affiliates. engages solely in bundled retail sales.
for natural gas and electric transmission However, a review of the voluntary (2) Marketing or sales does not include
providers. consent postings 39 on several incidental purchases or sales of natural gas
21. The Commission also is proposing transmission providers’ OASIS and to operate interstate natural gas pipeline
to expand the definition of marketing, Internet Web sites shows that sometimes transmission facilities.
asset managers are marketing affiliates, (3) Marketing means a sale of natural gas
sales or brokering to include entities
but that sometimes they are not.40 to any person or entity by a seller that is not
that manage or control transmission an interstate pipeline, except where:
capacity, such as asset managers or (i) The seller is selling gas solely from its
agents.34 Frequently, asset managers 36 American Electric Power Company, Inc., 110
own production;
and agents are involved extensively in FERC ¶ 61,061 (2005). (ii) The seller is selling gas solely from its
37 See Cleco, supra note 35.
transmission transactions, they stand in 38 South Carolina Electric & Gas Company, 111
own gathering or processing facilities; or
the shoes of the transmission customer (iii) The seller is an intrastate natural gas
FERC ¶ 61,217 (2005).
and act as nominating/balancing agent, 39 Currently, 18 CFR 358.5(b)(4) requires a
pipeline or a local distribution company
and have access to all the transmission making an on-system sale.
transmission provider to post notice if a non-
customer’s transmission information.35 affiliated transmission customer voluntarily D. Exceptions to the Independent
consents, in writing, to allow the transmission
provider to share the non-affiliated transmission
Functioning Requirement—Risk
34 Generally, asset managers manage or control
customer’s information with a marketing or energy Management Employees and Lawyers
gas or electric assets, often including a transmission
affiliate. 18 CFR 358.5(b)(4).
customer’s capacity. Agents frequently are
40 For example, El Paso Natural Gas Company’s
23. Section 358.4 requires, except in
authorized to act in the place of transmission emergency circumstances, the
customers with respect to specified transmission- voluntary consent postings on its Internet Web site
related activities such as nominations, scheduling identify that non-affiliated customers have transmission function employees 41 of
or billing. voluntarily consented to allow El Paso to disclose the transmission provider to function
35 In the investigation of Cleco Corporation, their respective information to El Paso’s marketing independently of the marketing
Commission staff observed that corporation’s asset and energy affiliates, e.g., El Paso Field Services,
L.P. (an energy affiliate) and El Paso Marketing L.P. affiliates’ employees. Notwithstanding
manager performed the following services for Cleco
Corporation: (1) Transmission scheduling services; (a marketing affiliate.) http://tebb.epenergy.com/
(2) resource coordination and delivery of power ebbepg/notices/ 41 Section 358.3(j) of the Commission’s
trading and ancillary services; (3) fuel purchases for noticeView.asp?sPipelineCode=EPNG&sSubC (Dec. regulations currently defines transmission function
generation use; (4) marketing and customer 8, 2006). Similar notices of asset management employee as an employee, contractor, consultant or
relations services; (5) commodity trading; (6) agreements or agency agreements can be found at agent of a transmission provider who conducts
monitoring, energy management, scheduling, the voluntary consent links of the OASIS or Internet transmission system operations or reliability
dispatch and accounting and billing services; (7) Web sites for National Fuel Gas Supply Corp., functions, including, but not limited to, those who
interaffiliate billing; (8) retail and wholesale Texas Eastern Transmission, LP, Tennessee Gas are engaged in day-to-day duties and
marketing; and (9) energy trading. Cleco Pipeline Company, Potomac Electric Power responsibilities for planning, directing, organizing
Corporation, 104 FERC ¶ 61,025 (2003) (Cleco). Company, and Dominion Transmission Inc. or carrying out transmission-related operations.
this requirement, since 1988, the individual is a transmission function rule modified § 358.5(c)(4)(i) 52 so that it
Commission has developed a body of employee (and may not be permissibly only applies to electric transmission
case law, permitting certain types of shared). providers and added a separate
employees to be shared between a 25. Petitioners appealed the provision for natural gas transmission
transmission provider and its marketing codification of the exception for providers at § 358.5(c)(4)(i) that
affiliate. At the request of industry permissibly shared risk management provides that natural gas transmission
participants, Order No. 2004 reiterated employees and the preamble discussion providers must maintain a written log of
these holdings by codifying exceptions in Order No. 2004 regarding permissibly waivers that the natural gas
to the independent functioning shared lawyers. As mentioned above, in transmission provider grants with
requirement that permit the sharing of National Fuel, the court did not address respect to tariff provisions that provide
officers and members of the board of these matters, and, accordingly, sub for such discretionary waivers and
directors (directors),42 support silencio, invalidated these aspects of provide the log to any person requesting
employees,43 field and maintenance Order No. 2004. Accordingly, the it within 24 hours of the request. The
employees,44 and risk management Commission is seeking comment on purpose of the discretionary waiver
employees.45 Although industry whether to make permanent changes posting requirement is to enable
participants urged the Commission to adopted by the interim rule by retaining transmission customers to determine
codify a general exception regarding the § 358.4(a)(6).50 The Commission also whether they are similarly situated and
sharing of lawyers, the Commission did seeks comments on whether to make potentially entitled to comparable
not do so stating that, if a lawyer this change applicable to electric public treatment by the transmission provider.
participated in transmission policy utility transmission providers. The 28. As mentioned above, in National
decisions on behalf of a transmission Commission is also seeking comments Fuel, the court did not address this
provider, he or she would be considered on whether additional guidance with matter, and, accordingly, sub silencio,
a transmission function employee (and respect to permissibly shared invalidated this aspect of Order No.
hence, not permissibly shared).46 employees, such as shared risk 2004. The Commission is faced with
24. In describing these exceptions, the management employees, lawyers and making permanent this requirement for
Commission stated that the sharing of officers and directors, would be helpful electric transmission providers, while
these non-transmission functions given the different structure, sizes and having different requirements for
allowed the transmission provider to operations of the various transmission natural gas transmission providers.
realize the benefits of cost saving providers. Accordingly, the Commission is seeking
through integration where the shared comment on whether to make
E. Discretionary Tariff Provision permanent changes adopted in the
employees do not have duties or
responsibilities relating to transmission, 26. In Order No. 2004, the interim rule by retaining
and generally would not be in a position Commission required each transmission §§ 358.5(c)(4)(i) and (ii) and seeking
to give a marketing affiliate an undue provider to maintain a log detailing the suggestions on what type of requirement
preference.47 The Commission also circumstances and manner in which it is appropriate to give similarly situated
stated that the exception allowing the exercised discretion under any terms of customers sufficient information to
sharing of officers and directors its tariff and post that information on its determine whether they are being
facilitated corporate governance OASIS or Internet Web site.51 The treated in a non-discriminatory fashion
activities, but that, to the extent a senior regulatory language in Order No. 2004 with respect to a transmission
was substantively identical to the provider’s discretionary activities. The
officer or director conducts transmission
requirement under Order No. 889, but it Commission also encourages
functions or is involved in planning,
was different than the requirement commenters to include suggestions on
directing or organizing transmission
under Order No. 497. Former § 161.3(k) how we can craft the scope of the
functions, the officer’s or director’s
promulgated in Order No. 497 required discretionary waiver requirement to
status does not automatically exempt
a pipeline to maintain a written log of minimize the burden on transmission
him/her from also being a transmission
waivers that the pipeline grants with providers while balancing the need for
function employee.48 In Order No.
respect to tariff provisions that provide transparency in the market.
2004–A, the Commission stated that,
although it permitted the sharing of for such discretionary waivers and F. Timing of When a New Natural Gas
these categories of employees, it would provide the log to any person requesting Transmission Provider Becomes Subject
evaluate, in compliance audits and it within 24 hours of the request. On to the Standards of Conduct
investigations, employees’ actual duties appeal, one of the petitioners claimed
that § 358.5(c)(4) was broader than 29. Under Order No 497, a natural gas
to determine whether the transmission transmission provider became subject to
provider is appropriately applying the former § 161.3(k), arguing that there was
a significant difference between granting the standards of conduct when the
exception.49 In other words, regardless transmission provider commenced
of an individual’s title or how his or her waivers of tariff provisions that provide
for such discretionary waivers (former transportation transactions with its
responsibilities are labeled, if that marketing or brokering affiliate.53 In the
individual is engaged in day-to-day § 161.3(k)) and exercising discretion
under any terms of its tariff preamble of Order No. 2004, the
duties and responsibilities for planning, Commission stated that newly
directing, organizing or carrying out (§ 358.5(c)(4)).
27. To comply with the court’s
transmission-related operations, that 52 Section 358.5(c)(4)(i) provides that Electric
mandate in National Fuel, the interim Transmission Providers must maintain a written
42 18 CFR 358.4(a)(5). log, available for Commission audit, detailing the
50 Interim 18 CFR 358.4(a)(6) reads: circumstances and manner in which they exercised
43 18 CFR 358.4(a)(4).
44 18 CFR 358.4(a)(4). ‘‘Transmission Providers are permitted to share risk their discretion under any terms of the tariff. The
45 18 CFR 358.4(a)(6).
management employees that are not engaged in information contained in this log is to be posted on
Transmission Functions or sales or commodity the OASIS or Internet Web site within 24 hours of
46 Order No. 2004–A at P 157.
functions with their Marketing and Energy when a Transmission Provider exercises its
47 Order No. 2004 at P 97.
Affiliates. This provision does not apply to natural discretion under any terms of the tariff. 18 CFR
48 Order No. 2004–B at P 57. gas transmission providers.’’ 358.5(c)(4)(i).
49 Order No. 2004–A at P 134. 51 18 CFR 358.5(c)(4). 53 Former 18 CFR 161.1 (2003).
certificated transmission providers information with energy affiliates, such in the context of business activity that
would become subject to the standards a producers, gatherers or LDCs. They the Commission did not address in
of conduct when the transmission argued that prohibiting the sharing of Order No. 2004, such as integrated
providers begin soliciting business or operational information might endanger resource planning and competitive
negotiating contracts as those are the reliability of the gas transmission solicitations.
activities which the Commission systems.56 Accordingly, Order No. 2004 33. To address integrated resource
considers transmission function codified current § 358.5(b)(8). In Order planning and competitive solicitations,
activities. In Order No. 2004–B, the No. 2004, the Commission provided the Commission proposes to make
Commission stated that a new interstate additional clarification explaining that changes to the standards of conduct
pipeline should observe the standards of this provision permits a transmission intended to make public utilities 58
conduct when the pipeline is granted provider to share day-to-day, integrated resource planning and
and accepts a certificate of public operational-type information with procurement more accurate and
convenience and necessity and becomes interconnected energy affiliates efficient, particularly in their
subject to the Commission’s jurisdiction necessary to maintain the pipelines’ consideration of electric transmission.
under the Natural Gas Act.54 The operations, such information includes The standards of conduct apply to ‘‘any
Commission stated that its goal was to confirmations, nominations and public utility that owns, operates or
ensure that newly formed pipelines schedulers with upstream producers controls facilities used for the
provide non-discriminatory treatment and gathering facilities, operational data transmission of electric energy in
and limit their ability to unduly favor relating to interconnection points and interstate commerce,’’ but do not apply
their marketing and energy affiliates.55 communications related to the to independent system operators (ISOs)
The timing of applicability of the maintenance of interconnected or regional transmission organizations
standards of conduct was one of the facilities. The Commission added that it (RTOs).59 In conducting integrated
items appealed, but not addressed in the expected that these types of resource planning, a public utility
National Fuel decision and vacated sub communications would take place evaluates its current and future mix of
silencio. In the interim rule, the between the operators of the pipeline or generation, transmission, demand-side
Commission did not require natural gas gas control facilities.57 As the management and other resources to
transmission providers to observe the Commission is proposing that the meet future demand while minimizing
standards of conduct until they standards of conduct will no longer costs, ensuring reliability, and
commence transportation transactions govern the relationship between natural complying with a state’s environmental
with their marketing affiliates. gas transmission providers and their requirements. As an example, integrated
30. The issue on appeal was whether energy affiliates, it appears that this resource planning may help a public
the Commission could apply the provision is no longer necessary because utility or state commission choose to
standards of conduct to a holder of a communications between a natural gas meet load growth through the addition
certificate that has not yet commenced transmission provider and its affiliated/ of a new generation resource, a new
transportation of natural gas. The interconnected gatherer(s), producer(s) demand resource, or through new
Commission does not have any evidence and LDCs are not restricted by the transmission resources. There is a wide
that affiliate abuse has occurred in the standards of conduct. Therefore, the variety of methods for conducting
time period before transportation Commission proposes to delete integrated resource planning. Some
commences, but believes there is clearly § 358.5(b)(8) from the regulations and states require public utilities to
an incentive for the transmission seeks comments on this proposal. periodically submit an integrated
provider to give an undue preference to resource plan. Such submissions are
its affiliates. A transmission provider H. Changes To Facilitate Integrated
typically subject to some review and
must observe the non-discrimination Resource Planning and Competitive
comment by the public and review and
provisions of sections 4 and 5 of the Solicitations
approval by the applicable state
Natural Gas Act (and sections 205 and 32. Since Order No. 2004 was issued, commission.
206 of the Federal Power Act). The industry participants have sought staff 34. The Commission believes that
Commission seeks comment on when a guidance on standards of conduct improved coordination between
transmission provider should be requirements to assist with their transmission planning, generation
required to comply with the standards compliance efforts. To provide further planning and demand response
of conduct and is proposing the guidance, the Commission held three programs, which are the main elements
following modification to § 358.4(e)(2). standards of conduct technical of integrated resource planning, is
Each Transmission Provider must be in full conferences, the most recent being held
compliance with the standards of conduct on April 7, 2006, and staff posted a 58 Under section 201(e) of the Federal Power Act,
within 30 days of becoming subject to the ‘‘Frequently Asked Questions’’ (FAQs) a public utility is ‘‘any person who owns or
Commission’s jurisdiction. page on the Commission’s Internet Web operates facilities subject to the jurisdiction of the
Commission.’’ 16 U.S.C. 824(e). The standards of
G. Revising § 358.5(b)(8) site. Following the April 7, 2006 conduct apply to a public utility that is a
technical conference, staff began a series transmission provider, which is defined as ‘‘any
31. Currently, § 358.5(b)(8) states that public utility that owns, operates or controls
of outreach meetings with various
a transmission provider is permitted to facilities used for the transmission of electric energy
industry participants, including public
share information necessary to maintain in interstate commerce’’ in addition to certain
utilities, industry trade associations and interstate natural gas pipelines. 18 CFR 358.3(a).
the operations of the transmission
state commissions, to discuss ways for 58 Under section 201(e) of the Federal Power Act,
system with its energy affiliates. In the
the Commission to address the a public utility is ‘‘any person who owns or
Order No. 2004 proceeding, natural gas
applicability of the standards of conduct operates facilities subject to the jurisdiction of the
commenters asked the Commission to Commission.’’ 16 U.S.C. 824(e). The standards of
adopt a provision allowing conduct apply to a public utility that is a
56 For electric transmission providers, a provision
transmission provider, which is defined as ‘‘any
communication of operational allowing communications relating to generation public utility that owns, operates or controls
dispatch exists at 18 CFR 358.5(b)(6) of the facilities used for the transmission of electric energy
54 Order No. 2004–B at P 136. Commission’s regulations. in interstate commerce’’ in addition to certain
55 Order No. 2004–C at P 46. 57 Order No. 2004–A at P 203. interstate natural gas pipelines. 18 CFR 358.3(a).
necessary to improve the economics and evaluation of transmission in bundled retail load is necessary to
reliability of the transmission grid. In procurement is as accurate and efficient prevent undue discrimination.
the next several years, reliability as possible. The Commission also
1. Integrated Resource Planning—
concerns are expected to grow as proposes to create a category of
Planning Employees
transmission investment has lagged employees under the standards of
behind load growth.60 As recently stated conduct, ‘‘competitive solicitation 38. In its outreach regarding
by North American Electric Reliability employees,’’ who are permitted to integrated resource planning, staff heard
Council (NERC), ‘‘[b]ulk power system conduct competitive solicitations a common refrain from public utilities,
reliability and adequacy depends on intended to serve bundled retail load, that the standards of conduct restrict
close coordination of generation and and to receive non-public transmission their ability to conduct integrated
transmission planning and demand information and to interact with resource planning because they restrict
response programs.’’ 61 The Commission transmission function employees in access to non-public transmission
also understands that some states are order to evaluate proposals submitted in information and restrict transmission
requiring greater consideration of a competitive solicitation. function employees from interacting
transmission in public utilities’ 36. These Commission proposals to with employees conducting integrated
integrated resource planning. In relax the standards of conduct to resource planning. Similarly, in its
consideration of these developments, facilitate integrated resource planning comments on the Open Access
the Commission seeks to ensure that the and competitive solicitations are Transmission Tariff (OATT) Reform
evaluation of transmission in public consistent with the treatment of NOPR,64 the National Association of
utilities’ planning and procurement is as bundled retail load in the standards of Regulatory Utility Commissioners called
accurate and efficient as possible. The conduct as outlined in Order No. 2004. for ‘‘allow[ing] communications
Commission proposes to create a The standards of conduct exempt from between resource and transmission
category of employees under the the definition of marketing affiliate planners for the purpose of developing
standards of conduct, ‘‘planning employees, those employees involved long-term resource planning documents
employees,’’ who are permitted to to satisfy State-commission integrated
‘‘solely in bundled retail sales.’’ 63 As
engage in all aspects of ‘‘integrated resource planning requirements.’’65
such, bundled retail sales employees are
resource planning’’ for bundled retail 39. The information sharing
not subject to the standards of conduct prohibitions of the standards of conduct
load, to receive non-public transmission in most respects. In an extension of this
information, and to interact with affect the type of transmission
policy, the Commission’s proposals are information that planners use to
transmission function employees, restricted to integrated resource conduct integrated resource planning.
provided that the integrated resource planning for, and competitive Public utilities relying on marketing or
planning is conducted pursuant to state solicitations to procure supply to serve, energy affiliate employees to perform
mandate. bundled retail load.
35. The Commission also understands their integrated resource planning are
37. In proposing to facilitate prohibited from obtaining non-public
that transmission concerns are integrated resource planning and
becoming a greater factor in resource transmission information from the
competitive solicitations through transmission provider and, instead, use
procurement. A public utility’s changes to the standards of conduct, the publicly-available information. In staff’s
integrated resource plan often serves as Commission is mindful of the goal of outreach sessions, some public utilities
the road map for the public utility’s the standards of conduct to prevent raised concerns, for example, that this
resource procurement. For instance, a undue preferences, specifically by prohibition precludes long-term
public utility may present an integrated preventing transmission providers from planners from obtaining information
resource plan that specifically calls for providing unduly preferential treatment about generation projects in the
long-term procurement of a certain type to their marketing and energy affiliates. interconnection queue, or from
of energy resource through a Thus, the Commission will place obtaining information regarding
competitive solicitation. Such restrictions on both planning employees planned retirements of generation. With
competitive solicitations may also be and competitive solicitation employees incomplete transmission information,
subject to state review and, if they result in order to prevent those employees public utilities contended, transmission
in the award of long-term contract to an from providing an undue preference to analysis for integrated resource
affiliate, review by the Commission.62 the transmission provider’s marketing planning is incomplete. As a result, they
The Commission understands the and energy affiliates. The Commission added, the IRP process is less efficient
importance of ensuring that the seeks to strike a balance between the and more costly, and the resulting
goal of diminishing opportunities for integrated resource plan is inferior.
59 18 CFR 358.1(b).
60 After
undue preferences with the goal of Public utilities contended, in effect, that
an extensive assessment, the NERC
recently concluded that ‘‘[e]xpansion and
improving the efficiency and accuracy the information sharing prohibitions of
strengthening of the transmission system continues of integrated resource planning and the standards of conduct create a gap
to lag demand growth and expansion of generating competitive solicitations. Along these between the transmission information
resources in most areas.’’ NERC, 2006 Long-Term lines, as discussed below, the needed to conduct integrated resource
Reliability Assessment, at p. 7 (Oct. 16, 2006). See
also Promoting Transmission Investment through
Commission seeks comment on whether planning and the transmission
Pricing Reform, Order No. 679, 71 FR 43293 (July or not the proposal to limit the new information available to their employees
31, 2006), FERC Stats. & Regs. ¶ 31,222, at P 10 categories of planning employees and
(July 20, 2006) (citations omitted) (observing that competitive solicitation employees to 64 Preventing Undue Discrimination and
transmission investment has declined while load Preference in Transmission Service, Docket No.
perform their functions only for
has doubled), order on reh’g, Order No. 679–A, 117 RM05–25–000, 71 FR 32635 (June 6, 2006), 71 FR
FERC ¶ 61,327 (Dec. 22, 2006). 39251 (July 12, 2006), FERC Stats. & Regs. ¶ 32,603
61 NERC, 2006 Long-Term Reliability Assessment, 62 See, e.g., Southern California Edison on behalf (May 19, 2006) (OATT Reform NOPR).
at p. 8; see also id. at p. 13 (‘‘In the long term, of Mountainview Power Co., LLC, 106 FERC 65 Comments of National Association of
reliable transmission will depend upon the close ¶ 61,183, at P 58 (2004) (setting forth criteria for Regulatory Utility Commissioners, Preventing
coordination of generation and transmission section 205 review of affiliate sales for contracts of Undue Discrimination and Preference in
planning and construction and the adoption of one year or longer), order on reh’g, 109 FERC Transmission Service, Docket No. RM05–25–000, at
longer term planning horizons * * * ’’). ¶ 61,086, order on reh’g, 110 FERC ¶ 61,319 (2005). p. 12 (filed Aug. 8, 2006).
who conduct integrated resource planning to serve bundled retail load and the employees conducting it are not
planning. conducted by public utilities that is subject to all of the usual restrictions of
40. Public utilities also asserted that mandated by the states. The the standards of conduct, although they
the independent functioning Commission does not intend to exclude would be subject to other restrictions
requirement of the standards of conduct from this definition any state’s outlined here.
hinders integrated resource planning mandated integrated resource planning 47. The Commission seeks comment
because the requirement prohibits to serve bundled retail load.67 on whether planning employees should
planners from working with 44. We understand that some public be restricted to planning for bundled
transmission function employees and utilities conduct integrated resource retail load or whether they should also
taking advantage of their understanding planning that is not subject to state be permitted to plan for Provider of Last
of the transmission system. review. Under the proposed regulations, Resort (POLR) load, grandfathered
41. The Commission seeks comment if a public utility conducts integrated wholesale requirements contracts, and
on whether and how the standards of resource planning that is not required wholesale full requirements load.
conduct preclude those who conduct by state mandate, it could not take Commenters addressing this issue
integrated resource planning from advantage of the planning employees should indicate the type of load for
obtaining needed transmission category. The Commission also seeks which they conduct integrated resource
information. Commenters should comment on this limitation. For planning or for which their state
explain what types of information, if example, are there states that do not requires integrated resource planning,
any, cannot reach such planners under have an explicit integrated resource e.g., only for bundled retail load, or for
the current standards of conduct and planning mandate, but that, bundled retail load, POLR load, and
how such information assists in creating nonetheless, review and approve wholesale requirements load.68 We note
an accurate integrated resource plan. integrated resource plans prepared and that for purposes of Order No. 888 and
The Commission also seeks comment on submitted by the public utilities? the Commission’s enforcement
whether planning employees would also 45. The Commission also proposes to practices, we have treated pre-1996,
need access to non-public customer limit the definition of ‘‘integrated grandfathered wholesale requirements
information in addition to non-public resource planning’’ to planning that is contracts similar to how we have treated
transmission information. designed to meet ‘‘future bundled retail bundled retail load.69 We seek
42. The Commission proposes to load obligations.’’ This limitation cabins comments on whether or not the
create a new category of employees the work of planning employees to work Commission should continue this
called ‘‘planning employees’’ who on bundled retail load obligations and, practice for integrated resource
would be permitted to direct, organize, thereby, precludes them from working planning. Commenters should also
and carry out all aspects of integrated on a public utility’s other load address whether the Commission could
resource planning including aspects obligations, such as wholesale load sufficiently facilitate integrated resource
related to transmission and generation obligations arising from contract. By this planning by limiting the definition of
planning. For the purpose of conducting limitation, the Commission seeks to integrated resource planning in the
integrated resource planning, planning ensure that the benefits of this proposal regulations to planning only for bundled
employees would be permitted to accrue to a public utility in service of retail load. Commenters should address
receive non-public transmission its retail customers and not to benefit a whether it is more cost-effective and
information (but not non-public utility in competition with other efficient to permit planning employees
customer information) from the wholesale market participants. We seek to conduct integrated resource planning
transmission provider and to interact comments on whether or not this for obligations other than bundled retail
with transmission function employees. limitation is necessary to prevent undue sales and what, if any, protections
66 In order to allow planning employees
discrimination. should be put in place to guard against
to interact with transmission function 46. To further restrict opportunities undue preferences to marketing and
employees, planning employees would for planning employees to provide energy affiliates. Does limiting planning
be exempt from the independent undue preferences to the transmission employees to bundled retail sales load
functioning requirement. The provider’s marketing or energy affiliates, unnecessarily divide a utility’s
Commission seeks comment on the planning employees would be subject to integrated resource planning?
creation of this category, including the the ‘‘no-conduit rule;’’ that is, they 48. Under this proposal, public utility
potential benefit and harm to the could not relay any non-public transmission providers that no longer
market. transmission information received to have bundled retail load obligations but
43. To ensure that an undue any marketing or energy affiliate. have POLR obligations because they
preference is not given to marketing or Planning employees also would be operate in states that have retail access
energy affiliates, the Commission also or retail choice would not be permitted
restricted from participating in the sales
proposes several restrictions and to share non-public transmission
or purchases of energy, capacity,
limitations. As part of this proposal, the
ancillary services or transmission
Commission would add a definition for 68 Here, the Commission delineates integrated
services to ensure that they did not use
the term ‘‘integrated resource planning’’ resource planning by type of load or contract. Staff
their access to transmission information research indicates that some state regulations do not
to the standards of conduct, which
and to transmission function employees delineate the scope of their integrated resource
would serve to describe and delineate planning requirement in the same way. For
to benefit the public utility or its
the types of resource planning activities instance, some states require that a utility conduct
affiliates in transactions with other
in which planning employees could integrated resource planning for its ‘‘customers’’
market participants. In other words, if without any delineation between wholesale or retail
participate. The definition is intended
to include all integrated resource the integrated resource planning customers. Other states require planning for
involves bundled retail load and is the ‘‘wholesale customers’’ without delineation
between wholesale requirements customers and
66 To the extent that transmission function result of a state mandate, the planning other wholesale customers. To assist in clarification
employees disclose non-public transmission of this issue, commenters should delineate
information that is not related to integrated resource 67 The Commission also understands that some precisely the scope of a state’s planning
planning, the transmission provider must observe states refer to integrated resource planning by requirements.
the posting requirements of 18 CFR 358.5(b)(2). different terms. 69 Cf. 18 CFR 35.28(c)(2)(i) and (ii).
information to conduct integrated Commission intends to supervise or and costs of proposals responsive to
resource planning.70 In Order No. 2004– otherwise prescribe the manner in competitive solicitations.
A, the Commission rejected a generic which states consider third-party 53. In raising this concern, some
request to treat POLR service obligations resources as part of their IRP processes public utilities focused on the
under state law as equivalent to a or that the Commission intends a final independent functioning requirement of
transmission provider’s bundled retail integrated resource plan to necessarily the standards of conduct, because this
sales obligations, which would have include third-party resources. The states requirement prohibits transmission
exempted POLR service from the are in the best position to make those function employees from working with
definition of marketing affiliate.71 The decisions as they are responsible for bid evaluators to determine the
Commission also indicated that it would resource procurement for bundled retail transmission costs of bids responsive to
entertain case-by-case requests for load. Therefore, the Commission will a competitive solicitation. To make the
exemption of POLR service. In several not second-guess the manner in which evaluation of transmission costs more
instances, the Commission has granted states evaluate third-party resources; we accurate, public utilities that conduct
requests by transmission providers that, only require that such resources be competitive solicitations seek to allow
under specific conditions, the POLR considered if a public utility seeks to greater interaction between transmission
service should be accorded the same use the planning employees category.73 function employees and those
treatment as bundled retail sales.72 The 51. We seek comment on the employees who conduct competitive
Commission seeks comment on whether foregoing restrictions placed on solicitations. In staff’s outreach, some
utilities with POLR service obligations planning employees’ activities. In their public utilities contended that greater
also should be allowed to take comments, commenters should address interaction would allow employees
advantage of the planning employees the balance the Commission is trying to conducting competitive solicitations to
category, or whether expanding the achieve between providing planning engage in an iterative method for
category to include POLR service employees with sufficient access to determining the ‘‘all-in’’ costs of a bid
obligations might harm competition or transmission information and to or combination of bids, i.e., the ‘‘net
give marketing or energy affiliates an transmission function employees to effect of a portfolio.’’ For instance, two
undue preference. conduct accurate and efficient 100–MW projects evaluated together
49. Finally, we are concerned that integrated resource planning while at may cost less in transmission upgrades
planning employees not be used in a the same time ensuring that such access than the same two projects would cost
manner that unduly discriminates does not enlarge opportunities for if calculated separately because one may
against non-affiliated wholesale planning employees to provide undue alleviate a constraint caused by the
suppliers. Specifically, in permitting preferences to the transmission other. Through an iterative method, bid
planning employees access to non- provider’s marketing or energy affiliates. evaluators could, for example, submit a
public transmission information and to Thus, commenters who believe that the portfolio of bid options to transmission
transmission function employees, we restrictions go too far should explain function employees, receive feedback on
are concerned that such access could be why, and, also, explain why the transmission costs related to the
used to favor utility-owned generation restrictions are unnecessary to prevent portfolio, refine the portfolio, and re-
over purchases from non-affiliates. For granting an undue preference. Likewise, submit it to transmission function
example, in the IRP process, planning commenters who believe that the employees for further evaluation, and, if
employees could use non-public restrictions do not go far enough to necessary, repeat these steps until a
transmission information to evaluate prevent the granting of undue complete evaluation is achieved. In
only self-build options and ignore any preferences should explain why and sum, some public utilities contended
consideration of purchases from third articulate how further restrictions can that, currently, they are unable to obtain
parties. Such an action would be be fashioned while still providing an accurate picture of the true
inconsistent with the underlying planning employees with sufficient transmission costs of a bid and may not
purpose of the proposal, which is to access to transmission information and select the least-cost proposal.
increase the economic use of the grid by to transmission function employees. 54. The Commission proposes to add
allowing planning employees to Finally, commenters supporting the a new category of ‘‘competitive
integrate the consideration of economic restrictions should explain the basis for solicitation employees,’’ who would be
alternatives. their support. We urge commenters to permitted to direct, organize and
50. To address this concern, the be as specific as possible in their execute certain ‘‘competitive
Commission proposes to limit the comments. solicitations.’’ Under this proposal,
definition of integrated resource competitive solicitation employees
planning to instances in which the IRP 2. Competitive Solicitation Employees could obtain non-public transmission
process includes evaluation of third- 52. In staff’s outreach sessions, some information (but not non-public
party resources. The proposed limit is public utilities also asserted that the customer information) from the
designed to balance the goal of standards of conduct hinder their ability transmission provider to the extent
facilitating least-cost resource to conduct efficient competitive necessary to evaluate bids or proposals
procurement with the concern that the solicitations, which are often conducted responsive to a competitive
planning employees category not be pursuant to an integrated resource plan. solicitation.74 The Commission does not
used to discriminate against non- Some public utilities contended that the believe that competitive solicitation
affiliates. We wish to clarify, however, standards of conduct hinder their ability employees have a need for non-public
that such a limitation does not mean the to evaluate the transmission impacts customer information. To the same
extent, competitive solicitation
70 The standards of conduct apply to merchant 73 This approach is consistent with the category employees could interact with
functions that are engaged in sales or purchases of being created below for competitive solicitations.
power that will be resold at retail under state retail We would permit competitive solicitation 74 To the extent that transmission function
choice programs. Order No. 2004 at P 78. employees to have access to non-public employees disclose transmission information that is
71 See Order No. 2004–A at P 127.
transmission information and transmission function not related to competitive solicitations, the
72 See, e.g., Cinergy Services, Inc., 111 FERC employees because, in those situations, the utility transmission provider must observe the posting
¶ 61,512 (2005). has allowed participation by third-party suppliers. requirements of 18 CFR 358.5(b)(3).
transmission function employees. In on whether or not the Commission planning employees to serve as
order to allow competitive solicitation should continue this practice for competitive solicitation employees and
employees to interact with transmission competitive solicitations. Should load vice-versa. The Commission seeks
function employees, competitive arising from POLR obligations or from comment on whether employees should
solicitation employees would be exempt wholesale requirements contracts, full be permitted to serve in both capacities.
from the independent functioning or partial, be supplied through such a Because competitive solicitation
requirement. competitive solicitation? The employees would have access to non-
55. To ensure that an undue Commission recognizes that supply public transmission information and to
preference is not given to marketing or obtained for bundled retail sales transmission function employees only
energy affiliates, the Commission sometimes is used to make wholesale for the purpose of conducting a
proposes several restrictions and sales, for instance, when bundled retail competitive solicitation, the
limitations.75 The term ‘‘competitive load decreases. Does this make Commission expects that competitive
solicitations’’ would be defined as a restricting competitive solicitations to solicitation employees would not need
solicitation by a public utility to obtain bundled retail sales unworkable? this access until after responses to a
energy, capacity, or ancillary services to 57. In order to protect against the competitive solicitation are received.
serve bundled retail load pursuant to an potential for undue preferences, the The Commission seeks comment on this
integrated resource plan. The definition Commission proposes further restriction.
would be limited to competitive restrictions on competitive solicitation 59. This proposed category of
solicitations that: (1) Are for the employees’ activities similar to the competitive solicitation employees may
purposes of meeting bundled retail load restrictions on planning employees. increase the opportunities to provide an
and (2) are made pursuant to a state- Competitive solicitation employees undue preference that is not sufficiently
mandated integrated resource plan. The would be subject to the ‘‘no-conduit offset by the proposed restrictions on
Commission intends the first limitation rule,’’ that is, they could not relay any the activities of competitive solicitation
to ensure that competitive solicitation non-public transmission information employees. Concerns about undue
employees are acting for the benefit of received to any marketing or energy preferences are greater in the
bundled retail load customers and not affiliate.76 Competitive solicitation competitive solicitation process than in
obtaining energy, capacity, or ancillary employees also would be restricted from the IRP process, because an undue
services for the purpose of meeting a participating in the sales or purchases of preference provided in a competitive
public utility’s other obligations. The energy, capacity, ancillary services or solicitation can lead to a more concrete,
Commission intends the second transmission services, other than in nearer-term benefit, e.g., a contract, than
limitation to ensure that the public competitive solicitations, to ensure that a similar preference granted in the IRP
utility does not use competitive they do not use their access to non- process, which has a longer term focus
solicitation employees for any attempt public transmission information and to and typically results in non-binding
to obtain energy, capacity or ancillary transmission function employees to recommendations. Further, competitive
services. Thus, this limitation ensures benefit the public utility or its affiliates solicitation employees may be
that competitive solicitation employees in transactions with other market evaluating third-party proposals in
are used only for relatively major participants. Competitive solicitation competition with proposals by affiliates
procurements by virtue of their having employees could not direct, organize, or or proposals by the public utility to
been conducted as part of integrated participate in the development of a bid, build itself the resources required. Thus,
resource planning. This limitation on or proposal submitted in a competitive it is important to ensure that
competitive solicitations would also solicitation or a benchmark used in a competitive solicitation employees do
ensure state involvement as integrated competitive solicitation. Further, not provide an undue preference,
resource planning is defined as analogous to the no-conduit rule, particularly through the use of non-
planning undertaken pursuant to state competitive solicitation employees public transmission information or
mandate. could not provide any non-public bid or access to transmission function
56. The Commission seeks comment competitive solicitation information to employees, throughout the competitive
on the type of load and contracts that marketing or energy affiliates. In other solicitation process from design through
would fall within the definition of a words, if the competitive solicitation
contract award.77 Accordingly, the
competitive solicitation and, thereby, be involves bundled retail load and is the
Commission seeks comments on
eligible to be supplied through a result of a state-mandated integrated
competitive solicitation that benefits whether its proposal strikes an
resource plan, the competitive
from non-public transmission appropriate balance between allowing
solicitation and the employees
information and access to transmission access to transmission information and
conducting it are not subject to all of the
function employees and what, if any, to transmission function employees
usual restrictions of the standards of
other protections should be put in place while at the same time including
conduct, although they would be subject
to guard against undue preferences to appropriate restrictions to prevent
to other restrictions outlined here.
marketing and energy affiliates. As 58. The Commission seeks comment undue preferences.
noted above, for purposes of Order No. on its competitive solicitation 60. The Commission seeks comment
888 and the Commission’s enforcement employees proposal and the restrictions on whether, instead of having separate
practices, we have treated pre-1996, that should apply to their activities, categories for planning employees and
grandfathered wholesale requirements including the potential benefit and harm for competitive solicitation employees,
contracts similar to how we have treated to the market, specifically, whether it should establish one category to
bundled retail load. We seek comments competitive solicitation employees include both sets of employees. States
would need access to non-public and utilities treat integrated resource

75 If a utility’s competitive solicitation results in
customer information in addition to planning and competitive solicitations
the award of a contract to its affiliate, the non-public transmission information.
Commission will review the resulting contract 77 This concern about undue preference is
under the guidelines set forth in Allegheny Energy The Commission would permit lessened in states that require an independent
Supply Company, LLC, 108 FERC ¶ 61,082, at P 22 evaluator to play a role in a public utility’s
(2004). 76 Proposed 18 CFR 358.5(b)(9). competitive solicitation.
differently in some respects; in other benchmark, or proposal by the public utility one company controls five percent or
respects, the two are treated together. or by the public utility’s Marketing or Energy more of its stock.79 The Commission
Commenters should explain whether Affiliates to supply energy, capacity or proposes changes to the definition of
ancillary services;
they would use the same personnel for (ii) Participate in purchases of energy,
affiliate with respect to EWGs in light of
each category. Commenters should also capacity or ancillary services or of purchases the repeal of the PUHCA. Specifically,
address whether keeping the categories of transmission services other than in a the Commission proposes to make
separate assists in preventing undue Competitive Solicitation on behalf of its conforming changes to the definition of
discrimination. Commenters advocating public utility Transmission Provider; or EWG to delete the reference to PUHCA
a single category for both planning and (iii) Participate in non-planning and direct the reader to 18 CFR 366.1,
competitive solicitation employees transmission functions. which contains a definition of EWG and
(2) A Transmission Function employee
should describe the permissible a definition of affiliate that applies to an
may interact with a Competitive Solicitation
activities for such employees and set Employee for the purpose of evaluating the EWG.80
forth the restrictions that would apply transmission component of bids or proposals 63. Accordingly, the Commission
to their activities. considered in a Competitive Solicitation. A proposes that § 358.3(b)(2) will read as
Competitive Solicitation Employee, who follows:
3. Specific Proposals receives non-public transmission information
For any exempt wholesale generator (as
61. In light of the discussion above, pursuant to § 358.5(b)(9) or who interacts
defined under § 366.1 of this chapter), an
the Commission proposes the following with a Transmission Function employee,
affiliate means the same as the definition of
regulatory changes. We propose the must not:
‘‘affiliate’’ provided in § 366.1 of this chapter.
following revision to the definition of (i) Provide any non-public bid, proposal, or
Competitive Solicitation information to the J. Revisions to Written Procedures
Transmission Function employee in Marketing or Energy Affiliate employees;
§ 358.3(j): (ii) Participate in sales of energy, capacity, 64. The Commission proposes several
Transmission Function employee means an ancillary services or in sales of transmission changes to the written procedures
employee, contractor, consultant or agent of services, including directing, organizing, or required of a transmission provider to
a Transmission Provider, other than a otherwise preparing a bid, benchmark, or delete outdated references, to clarify
Planning Employee as defined in § 358.3(o), proposal by the public utility or by the public training certification, and to post the
who conducts transmission system utility’s Marketing or Energy Affiliates to name of a transmission provider’s chief
operations or reliability functions, including, supply energy, capacity or ancillary services;
compliance officer.
but not limited to, those who are engaged in or
(iii) Participate in any purchases of energy, 65. Currently, § 358.4(e)(1) of the
day-to-day duties and responsibilities for
planning, directing, organizing or carrying capacity or ancillary services or of Commission’s regulations reads:
out transmission-related operations. transmission services other than a By February 9, 2004, each Transmission
Competitive Solicitation on behalf of its Provider is required to file with the
We propose the following additions to public utility Transmission Provider. Commission and post on the OASIS or
the definitions in § 358.3: Internet website a plan and schedule for
We propose the following additions to
(1) Integrated Resource Planning means a the Non-Discrimination Requirements implementing the standards of conduct.
process to establish a plan, required by state
section in § 358.5(b): Currently, § 358.4(e)(3) of the
law, regulation or other state mandate, for a
public utility to meet its future bundled retail (1) A Transmission Provider may share Commission’s regulations reads:
load obligations that evaluates a range of transmission information covered by The Transmission Provider must post on
alternatives that includes consideration of §§ 358.5(a) and (b)(1) with Planning the OASIS or Internet website, current
third party resources. Employees to the extent those employees written procedures implementing the
(2) Competitive Solicitation means a need that information to direct, organize or standards of conduct in such detail as will
solicitation by a public utility to obtain carry out Integrated Resource Planning, enable customers and the Commission to
energy, capacity, or ancillary services for the provided that such employees do not act as determine that the Transmission Provider is
purposes of meeting the public utility’s a conduit to share such information with any in compliance with the requirements of this
bundled retail load obligations pursuant to Marketing or Energy Affiliates. section by September 22, 2004 or within 30
an Integrated Resource Planning obligation. (2) A Transmission Provider may share days of becoming subject to the requirements
(3) Competitive Solicitation Employee transmission information covered by of part 358.
means an employee, contractor, consultant or §§ 358.5(a) and (b)(1) with Competitive
agent of a public utility who directs, Solicitation Employees to the extent those The Commission proposes to delete
organizes, or executes the public utility’s employees need that information to direct, § 358.4(e)(1) because the date for
Competitive Solicitations. organize, or execute Competitive submitting a plan and schedule for
(4) Planning Employee means an employee, Solicitations, provided that such employees implementing the standards of conduct
contractor, consultant or agent of a public do not act as a conduit to share such has passed and the Commission does
utility who directs, organizes or conducts the information with any Marketing or Energy
Affiliates.
not need a new plan and schedule with
public utility’s Integrated Resource Planning. respect to § 358.4(e)(3). The Commission
We propose the following additions to I. Changes to the Definition of Exempt proposes deleting ‘‘by September 22,
the Independent Functioning section, Wholesale Generator 2004 or’’ because that date has passed
§ 358.4: 62. Currently, the standards of and we are proposing to require in
(1) A Transmission Function employee conduct define affiliate for an exempt § 358.4(e)(3) that a transmission
may interact with a Planning Employee for wholesale generator (EWG) by referring provider must comply with the
the purpose of engaging in Integrated to section 32a of Public Utility Holding
79 For non-EWG affiliates, a voting interest of 10
Resource Planning. A Planning Employee, Company Act of 1935 (PUHCA) and
who receives non-public transmission percent or more creates a rebuttable presumption of
section 214 of the Federal Power Act
information pursuant to § 358.5(b)(8) or who control or affiliation. 18 CFR 358.3(c).

(which in turn references, section 2(a) of 80 18 CFR 366.1 implements the Public Utility
interacts with a Transmission Function
employee, must not: PUHCA).78 With respect to the Holding Company Act of 2005. (PUHCA 2005). The
standards of conduct, a determination of Energy Policy Act of 2005 (EPAct 2005), Pub. L. No.
(i) Participate in sales of energy, capacity 109–58, 119 Stat. 594 (2005), repealed PUHCA, 15
or ancillary services or in sales of affiliation for EWGs is based on whether U.S.C. 79a et seq. (2000), and enacted the Public
transmission services, including directing, Utility Holding Company Act of 2005 (PUHCA
organizing, or otherwise preparing a bid, 78 18 CFR 358.3(b)(2). 2005), EPAct 2005 at 1261 et seq.
standards of conduct within 30 days of their energy affiliates, the information Michael.miller@ferc.gov. Comments on
becoming subject to the requirements of collection burden will likely decrease. the requirements of the proposed rule
part 358. 70. The Commission is submitting also may be sent to the Office of
66. Section 358(e)(5) of the notification of the information Information and Regulatory Affairs,
Commission’s regulations require collection requirements imposed in the Office of Management and Budget,
training on the standards of conduct for NOPR to OMB for its review and Washington, DC 20503 [Attention: Desk
certain employees of the transmission approval under section 3507(d) of the Officer for the Federal Energy
provider. Those employees are required Paperwork Reduction Act of 1995.84 Regulatory Commission].
to ‘‘sign a document or certify Comments are solicited on the
IV. Environmental Analysis
electronically that s/he has participated Commission’s need for this information,
in the training.’’ In order to ensure that whether the information will have 74. The Commission is required to
such employees not only participate in, practical utility, the accuracy of prepare an Environmental Assessment
but, also, complete such training, the provided burden estimates, ways to or an Environmental Impact Statement
Commission proposes replacing the enhance the quality, utility, and clarity for any action that may have a
words ‘‘participated in’’ with the word of the information to be collected, and significant adverse effect on the human
‘‘completed’’ so that the applicable any suggested methods of minimizing environment.85 The Commission has
sentence would read: ‘‘The respondent’s burden, including the use categorically excluded certain actions
Transmission Provider must require of automated information techniques. from these requirements as not having a
each employee to sign a document or 71. OMB regulations require OMB to significant effect on the human
certify electronically signifying that s/he approve certain information collection environment.86 The action proposed
has completed the training.’’ 81 requirements imposed by agency rule. here falls within the categorical
67. Section 358.4(e)(6) requires The Commission is submitting exclusions provided in the
transmission providers to designate a notification of this proposed rule to Commission’s regulations because this
chief compliance officer who will be OMB. rule is clarifying and corrective and
responsible for standards of conduct Title: FERC–592 and 717. does not substantially change the effect
compliance. Recently, Commission staff Action: Proposed Collection. of the regulations being amended.87
has tried to identify the name of the OMB Control No: 1902–0157 and Therefore, an environmental assessment
chief compliance officers of several 1902–173. is unnecessary and has not been
transmission providers, and noticed that Respondents: Business or other for prepared in this rulemaking.
some transmission providers do not profit.
Frequency of Responses: On occasion. V. Regulatory Flexibility Act
publicly identify the name of the chief Necessity of the Information: The 75. The Regulatory Flexibility Act of
compliance officer. Therefore, the information is necessary to ensure that 1980 (RFA) 88 generally requires a
Commission proposes to add the all regulated transmission providers description and analysis of final rules
following sentence to § 358.4(e)(6) as treat all transmission customers on a that will have significant economic
follows: ‘‘Transmission Providers must non-discriminatory basis. impact on a substantial number of small
post the name of the Chief Compliance Internal Review: The Commission has entities. Because most transmission
Officer and provide contact information reviewed the requirements pertaining to providers do not fall within the
on the OASIS or Internet Web site, as natural gas pipelines and transmitting definition of ‘‘small entity,’’ 89 the
applicable.’’ electric utilities and determined the Commission certifies that this rule will
III. Information Collection Statement proposed revisions are necessary not have a significant economic impact
because of changes in transmission on a substantial number of small
68. The Office of Management and
provider practices and in the energy entities.
Budget (OMB) regulations require
market. The Commission proposes to
approval of certain information VI. Comment Procedures
revise the standards of conduct to be
collection requirements imposed by 76. The Commission invites interested
consistent with the recent court
agency rules.82 In this NOPR, the persons to submit comments on the
decisions and to make certain
Commission proposes to reinstate the matters and issues proposed in this
transmission provider practices more
provisions remanded by the court in notice to be adopted, including any
efficient and less costly.
National Fuel. 72. These requirements conform to related matters or alternative proposals
69. Previously, the Commission the Commission’s plan for efficient that commenters may wish to discuss.
submitted to OMB the information information collection, communication, Comments must be filed on or before
collection requirements arising from the and management within the natural gas March 15, 2007. Reply comments must
standards of conduct adopted in Order and electric utility industries. The be filed on or before April 4, 2007.
No. 2004. OMB approved those Commission has assured itself, by Comments and reply comments must
requirements.83 The revisions to the means of internal review, that there is refer to Docket No. RM07–1–000, and
standards of conduct proposed in this specific, objective support for the must include the commenter’s name,
issuance do not impose any additional burden estimates associated with the the organization he or she represents, if
information collection burden on information requirements. applicable, and his or her address.
industry participants. In fact, by 73. Interested persons may obtain 77. Comments may be filed
proposing that the standards of conduct information on the reporting electronically via the eFiling link on the
will no longer govern the relationship requirements by contacting: Federal
between transmission providers and Energy Regulatory Commission, 888 85 Regulations Implementing the National
First Street, NE., Washington, DC 20426, Environmental Policy Act, Order No. 486, 52 FR
81 Proposed 18 CFR 358.3(e)(5). 47897 (Dec. 17, 1987), FERC Stats. & Regs.
[Attention: Michael Miller, Office of the Preambles 1986–1990 ¶ 30,783 (1987).
82 5CFR 1320.11.
83 Letter from OMB to the Commission (Jan. 20,
Chief Information Officer], phone: (202) 86 18 CFR 380.4.
2004) (OMB Control Number 1902–0157); ‘‘Notice 502–8415, fax: (202) 208–2425, e-mail: 87 18 CFR 380.4(a)(2)(ii) and 380.4(a)(5).
88 5 U.S.C. 601–612.
of Action’’ letter from OMB to the Commission (Jan.
20, 2004) (OMB Control Number 1902–0173). 84 44 U.S.C. 3507(d). 89 See 5 U.S.C. 601(3).
Commission’s Web site at http:// PART 358—STANDARDS (3) A Transmission Provider does not
www.ferc.gov. The Commission accepts include a natural gas storage provider
most standard word processing formats, Sec. authorized to charge market-based rates
and commenters may attach additional 358.1 Applicability. that is not interconnected with the
358.2 General principles.
files with supporting information in 358.3 Definitions.
jurisdictional facilities of any affiliated
certain other file formats. Commenters 358.4 Independent functioning. interstate natural gas pipeline, has no
filing electronically do not need to make 358.5 Non-discrimination requirements. exclusive franchise area, no captive
a paper filing. ratepayers and no market power.
Authority: 15 U.S.C. 717–717w, 3301–
78. Commenters who are not able to (b) Affiliate means:
3432; 16 U.S.C. 791–825r, 2601–2645; 31
file comments electronically must send U.S.C. 9701; 42 U.S.C. 7101–7352.
(1) Another person which controls, is
an original and 14 copies of their controlled by or is under common
comments to: Federal Energy Regulatory § 358.1 Applicability. control with, such person. An affiliate
Commission, Office of the Secretary, (a) This part applies to any interstate includes a division that operates as a
888 First Street, NE., Washington, DC natural gas pipeline that transports gas functional unit,
20426. for others pursuant to subpart A of part (2) For any exempt wholesale
79. All comments will be placed in 157 or subparts B or G of part 284 of this generator (as defined under § 366.1 of
the Commission’s public files and may chapter. this chapter), an affiliate means the
be viewed, printed, or downloaded (b) This part applies to any public same as the definition of ‘‘affiliate’’
remotely as described in the Document utility that owns, operates, or controls provided in § 366.1 of this chapter.
facilities used for the transmission of (c) Control (including the terms
Availability section below. Commenters
electric energy in interstate commerce. ‘‘controlling,’’ ‘‘controlled by,’’ and
on this NOPR are not required to serve
(c) This part does not apply to a ‘‘under common control with’’) as used
copies of their comments on other
public utility Transmission Provider in this part and § 250.16 of this chapter,
commenters.
that is a Commission-approved includes, but is not limited to, the
VII. Document Availability Independent System Operator (ISO) or possession, directly or indirectly and
Regional Transmission Organization whether acting alone or in conjunction
80. In addition to publishing the full
(RTO). If a public utility transmission with others, of the authority to direct or
text of this document in the Federal
owner participates in a Commission- cause the direction of the management
Register, the Commission provides all
approved ISO or RTO and does not or policies of a company. A voting
interested persons an opportunity to
operate or control its transmission interest of 10 percent or more creates a
view and/or print the contents of this
facilities and has no access to rebuttable presumption of control.
document via the Internet through (d) Energy Affiliate means an affiliate
FERC’s Home Page (http://www.ferc.gov) transmission, customer or market of a Transmission Provider that:
and in FERC’s Public Reference Room information covered by § 358.5(b), it
(1) Engages in or is involved in
during normal business hours (8:30 a.m. may request an exemption from this transmission transactions in U.S. energy
to 5 p.m. Eastern time) at 888 First part.
(d) A Transmission Provider may file or transmission markets; or
Street, NE., Room 2A, Washington DC (2) Manages or controls transmission
20426. a request for an exemption from all or
some of the requirements of this part for capacity of a Transmission Provider in
81. From FERC’s Home Page on the U.S. energy or transmission markets; or
good cause.
Internet, this information is available on (3) Buys, sells, trades or administers
(e) The Standards of Conduct in this
eLibrary. The full text of this document natural gas or electric energy in U.S.
part do not govern the relationship
is available on eLibrary in PDF and energy or transmission markets; or
between a natural gas Transmission
Microsoft Word format for viewing, (4) Engages in financial transactions
Provider as defined in § 358.3(a)(2) and
printing, and/or downloading. To access relating to the sale or transmission of
its Energy Affiliates.
this document in eLibrary, type the natural gas or electric energy in U.S.
docket number excluding the last three § 358.2 General principles. energy or transmission markets.
digits of this document in the docket (a) A Transmission Provider’s (5) An LDC division of an electric
number field. employees engaged in transmission public utility Transmission Provider
82. User assistance is available for system operations must function shall be considered the functional
eLibrary and the FERC’s Web site during independent from employees of its equivalent of an Energy Affiliate, unless
normal business hours from our Help Marketing and Energy Affiliates. it qualifies for the exemption in
line at (202) 502–8222 or the Public (b) A Transmission Provider must § 358.3(d)(6)(v).
Reference Room at (202) 502–8371 Press treat all transmission customers, (6) An Energy Affiliate does not
0, TTY (202) 502–8659. E-Mail the affiliated and non-affiliated, on a non- include:
Public Reference Room at discriminatory basis, and must not (i) A foreign affiliate that does not
public.referenceroom@ferc.gov. operate its transmission system to participate in U.S. energy markets;
preferentially benefit Marketing and (ii) An affiliated Transmission
List of Subjects in 18 CFR Part 358 Provider or an interconnected foreign
Energy Affiliates.
Electric power plants, Electric affiliated natural gas pipeline that is
utilities, Natural gas, Reporting and § 358.3 Definitions. engaged in natural gas transmission
recordkeeping requirements. (a) Transmission Provider means: activities that are regulated by the state,
(1) Any public utility that owns, provincial or national regulatory boards
By direction of the Commission.
operates or controls facilities used for of the foreign country in which such
Magalie R. Salas, the transmission of electric energy in facilities are located.

Secretary. interstate commerce; or (iii) A holding, parent or service
In consideration of the foregoing, the (2) Any interstate natural gas pipeline company that does not engage in energy
Commission proposes to revise part 358, that transports gas for others pursuant to or natural gas commodity markets or is
Chapter I, Title 18, Code of Federal subpart A of part 157 or subparts B or not involved in transmission
Regulations, as follows: G of part 284 of this chapter. transactions in U.S. energy markets;
(iv) An affiliate that purchases natural interconnection with jurisdictional system reliability, the transmission
gas or energy solely for its own transmission facilities. function employees of the Transmission
consumption. ‘‘Solely for its own (g) Transmission Customer means any Provider must function independently
consumption’’ does not include the eligible customer, shipper or designated of the Transmission Provider’s
purchase of natural gas or energy for the agent that can or does execute a Marketing or Energy Affiliates’
subsequent generation of electricity. transmission service agreement or can employees.
(v) A State-regulated local distribution or does receive transmission service, (2) Notwithstanding any other
company that acquires interstate including all persons who have pending provisions in this section, in emergency
transmission capacity to purchase and requests for transmission service or for circumstances affecting system
resell gas only for on-system sales, and information regarding transmission. reliability, a Transmission Provider may
otherwise does not engage in the (h) Open Access Same-time take whatever steps are necessary to
activities described in § 358.3(d)(1), (2), Information System or OASIS refers to keep the system in operation.
(3) or (4), except to the limited extent the Internet location where a public Transmission Providers must report to
necessary to support on-system sales utility posts the information, by the Commission and post on the OASIS
and to engage in de minimis sales electronic means, required by part 37 of or Internet Web site, as applicable, each
necessary to remain in balance under this chapter. emergency that resulted in any
applicable pipeline tariff requirements. (i) Internet Web site refers to the deviation from the standards of conduct,
(vi) A processor, gatherer, Hinshaw Internet location where an interstate within 24 hours of such deviation.
pipeline or an intrastate pipeline that natural gas pipeline posts the (3) The Transmission Provider is
makes incidental purchases or sales of information, by electronic means, prohibited from permitting the
de minimis volumes of natural gas to required by §§ 284.12 and 284.13 of this employees of its Marketing or Energy
remain in balance under applicable chapter. Affiliates from:
pipeline tariff requirements and (j) Transmission Function employee (i) Conducting transmission system
otherwise does not engage in the means an employee, contractor, operations or reliability functions; and
activities described in §§ 358.3(d)(1), consultant or agent of a Transmission (ii) Having access to the system
(2), (3) or (4). Provider, other than a Planning control center or similar facilities used
Employee as defined in § 358.3(o), who for transmission operations or reliability
(e) Marketing, sales or brokering
conducts transmission system functions that differs in any way from
means a sale for resale of natural gas or
operations or reliability functions, the access available to other
electric energy in interstate commerce
including, but not limited to, those who transmission customers.
in U.S. energy or transmission markets.
are engaged in day-to-day duties and (4) Transmission Providers are
Marketing also includes managing or
responsibilities for planning, directing, permitted to share support employees
controlling transmission capacity of a
organizing or carrying out transmission- and field and maintenance employees
third-party as an asset manager or agent.
related operations. with their Marketing and Energy
(1) A sales and marketing employee or Affiliates.
unit includes: (k) Marketing Affiliate means an
Affiliate as that term is defined in (5) Transmission Providers are
(i) An interstate natural gas pipeline’s permitted to share with their Marketing
sales operating unit, to the extent § 358.3(b) or a unit that engages in
marketing, sales or brokering activities or Energy Affiliates senior officers and
provided in § 284.286 of this chapter, directors who are not ‘‘Transmission
and as those terms are defined at § 358.3(e).
(l) Integrated Resource Planning Function Employees’’ as that term is
(ii) A public utility Transmission defined in § 358.3(j). A Transmission
means a process to establish a plan,
Provider’s energy sales unit, unless such Provider may share transmission
required by state law, regulation or
unit engages solely in bundled retail information covered by §§ 358.5(a) and
other state mandate, for a public utility
sales. (b) with its shared senior officers and
to meet its future bundled retail load
(2) Marketing or sales does not directors provided that they do not
obligations that evaluates a range of
include incidental purchases or sales of participate in directing, organizing or
alternatives that includes consideration
natural gas to operate interstate natural executing transmission system
of third party resources.
gas pipeline transmission facilities. (m) Competitive Solicitation means a operations or marketing functions; or act
(3) Marketing means a sale of natural solicitation by a public utility to obtain as a conduit to share such information
gas to any person or entity by a seller energy, capacity, or ancillary services with a Marketing or Energy Affiliate.
that is not an interstate pipeline, except for the purposes of meeting the public (6) Transmission Providers are
where: utility’s bundled retail load obligations permitted to share risk management
(i) The seller is selling gas solely from pursuant to an Integrated Resource employees that are not engaged in
its own production; Planning obligation. Transmission Functions or sales or
(ii) The seller is selling gas solely (n) Competitive Solicitation Employee commodity functions with their
from its own gathering or processing means an employee, contractor, Marketing and Energy Affiliates. This
facilities; or consultant or agent of a public utility provision does not apply to natural gas
(iii) The seller is an intrastate natural who directs, organizes, or executes the transmission providers.
gas pipeline or a local distribution public utility’s Competitive (7) A Transmission Function
company making an on-system sale. Solicitations. employee may interact with a Planning
(f) Transmission means natural gas (o) Planning Employee means an Employee for the purpose of engaging in
transportation, storage, exchange, employee, contractor, consultant or Integrated Resource Planning. A
backhaul, or displacement service agent of a public utility who directs, Planning Employee, who receives non-
provided pursuant to subpart A of part organizes or conducts the public public transmission information
157 or subparts B or G of part 284 of this utility’s Integrated Resource Planning. pursuant to § 358.5(b)(8) or who
chapter; and electric transmission, interacts with a Transmission Function
network or point-to-point service, § 358.4 Independent functioning. employee, must not:
reliability service, ancillary services or (a) Separation of functions. (1) Except (i) Participate in sales of energy,
other methods of transportation or the in emergency circumstances affecting capacity or ancillary services or in sales
of transmission services, including directors, with the exception of clerical, prescribed under parts 101, 125, 201
directing, organizing, or otherwise maintenance, and field positions. The and 225 of this chapter) separately from
preparing a bid, benchmark, or proposal job titles and descriptions must include those of its Energy Affiliates and these
by the public utility or by the public the employee’s title, the employee’s must be available for Commission
utility’s Marketing or Energy Affiliates duties, whether the employee is inspections.
to supply energy, capacity or ancillary involved in transmission or sales, and (e) Written procedures. (1) [Reserved.]
services; the name of the supervisory employees (2) Each Transmission Provider must
(ii) Participate in purchases of energy, who manage non-clerical employees be in full compliance with the standards
capacity or ancillary services or of involved in transmission or sales. of conduct within 30 days of becoming
purchases of transmission services other (iii) For all employees who are subject to the Commission’s
than in a Competitive Solicitation on engaged in transmission functions for jurisdiction.
behalf of its public utility Transmission the Transmission Provider and (3) The Transmission Provider must
Provider; or marketing or sales functions or who are post on the OASIS or Internet Web site,
(iii) Participate in non-planning engaged in transmission functions for current written procedures
transmission functions. the Transmission Provider and are implementing the standards of conduct
(8) A Transmission Function employed by any of the Energy in such detail as will enable customers
employee may interact with a Affiliates, the Transmission Provider and the Commission to determine that
Competitive Solicitation Employee for must post the name of the business unit the Transmission Provider is in
the purpose of evaluating the within the marketing or sales unit or the compliance with the requirements of
transmission component of bids or Energy Affiliate, the organizational this section within 30 days of becoming
proposals considered in a Competitive structure in which the employee is subject to the requirements of part 358.
Solicitation. A Competitive Solicitation located, the employee’s name, job title (4) Transmission Providers will
Employee, who receives non-public and job description in the marketing or distribute the written procedures to all
transmission information pursuant to sales unit or Energy Affiliate, and the Transmission Provider employees and
§ 358.5(b)(9) or who interacts with a employee’s position within the chain of employees of the Marketing and Energy
Transmission Function employee, must command of the Marketing or Energy Affiliates.
not: Affiliate. (5) Transmission Providers shall train
(i) Provide any non-public bid, (iv) The Transmission Provider must officers and directors as well as
proposal, or Competitive Solicitation update the information on its OASIS or employees with access to transmission
information to the Marketing or Energy Internet Web site, as applicable, information or information concerning
Affiliate employees; required by §§ 358.4(b)(1), (2) and (3) gas or electric purchases, sales or
(ii) Participate in sales of energy, within seven business days of any marketing functions. The Transmission
capacity, ancillary services or in sales of change, and post the date on which the Provider must require each employee to
transmission services, including information was updated. sign a document or certify electronically
directing, organizing, or otherwise (v) The Transmission Provider must signifying that s/he has completed the
preparing a bid, benchmark, or proposal post information concerning potential training.
by the public utility or by the public merger partners as affiliates within (6) Transmission Providers are
utility’s Marketing or Energy Affiliates seven days after the potential merger is required to designate a Chief
to supply energy, capacity or ancillary announced. Compliance Officer who will be
services; or (vi) All OASIS or Internet Web site responsible for standards of conduct
(iii) Participate in any purchases of postings required by part 358 must compliance. Transmission Providers
energy, capacity or ancillary services or comply, as applicable, with the must post the name of the Chief
of transmission services other than a requirements of § 37.6 or §§ 284.12(a) Compliance Officer and provide contact
Competitive Solicitation on behalf of its and (c)(3)(v) of this chapter. information on the OASIS or Internet
public utility Transmission Provider. (c) Transfers. Employees of the Web site, as applicable.
(b) Identifying affiliates on the public Transmission Provider, Marketing or
Internet. (1) A Transmission Provider Energy Affiliates are not precluded from § 358.5 Non-discrimination requirements.
must post the names and addresses of transferring among such functions as (a) Information access. (1) The
Marketing and Energy Affiliates on its long as such transfer is not used as a Transmission Provider must ensure that
OASIS or Internet Web site. means to circumvent the Standards of any employee of its Marketing or Energy
(2) A Transmission Provider must Conduct. Notices of any employee Affiliate may only have access to that
post on its OASIS or Internet Web site, transfers between the Transmission information available to the
as applicable, a complete list of the Provider, on the one hand, and the Transmission Provider’s transmission
facilities shared by the Transmission Marketing or Energy Affiliates on the customers (i.e., the information posted
Provider and its Marketing and Energy other, must be posted on the OASIS or on the OASIS or Internet Web site, as
Affiliates, including the types of Internet Web site, as applicable. The applicable), and must not have access to
facilities shared and their addresses. information to be posted must include: any information about the Transmission
(3) A Transmission Provider must the name of the transferring employee, Provider’s transmission system that is
post comprehensive organizational the respective titles held while not available to all users of an OASIS or
charts showing: performing each function (i.e., on behalf Internet Web site, as applicable.
(i) The organizational structure of the of the Transmission Provider, Marketing (2) The Transmission Provider must
parent corporation with the relative or Energy Affiliate), and the effective ensure that any employee of its
position in the corporate structure of the date of the transfer. The information Marketing or Energy Affiliate is
Transmission Provider, Marketing and posted under this section must remain prohibited from obtaining information
Energy Affiliates; on the OASIS or Internet Web site, as about the Transmission Provider’s
(ii) For the Transmission Provider, the applicable, for 90 days. transmission system (including, but not
business units, job titles and (d) Books and records. A limited to, information about available
descriptions, and chain of command for Transmission Provider must maintain transmission capability, price,
all positions, including officers and its books of account and records (as curtailments, storage, ancillary services,
balancing, maintenance activity, with a statement that it did not provide sale or purchase of open access
capacity expansion plans or similar any preferences, either operational or transmission service in a fair and
information) through access to rate-related, in exchange for that impartial manner that treats all
information not posted on the OASIS or voluntary consent. transmission customers in a non-
Internet Web site or that is not (5) A Transmission Provider is not discriminatory manner, if these tariff
otherwise also available to the general required to contemporaneously disclose provisions permit the use of discretion.
public without restriction. to all transmission customers or (3) A Transmission Provider must
(b) Prohibited disclosure. (1) An potential transmission customers
process all similar requests for
employee of the Transmission Provider information covered by § 358.5(b)(1) if it
transmission in the same manner and
may not disclose to its Marketing or relates solely to a Marketing or Energy
within the same period of time.
Energy Affiliates any information Affiliate’s specific request for
concerning the transmission system of transmission service. (4)(i) Electric Transmission Providers
the Transmission Provider or the (6) A Transmission Provider may must maintain a written log, available
transmission system of another share generation information necessary for Commission audit, detailing the
(including, but not limited to, to perform generation dispatch with its circumstances and manner in which
information received from non-affiliates Marketing and Energy Affiliate that does they exercised their discretion under
or information about available not include specific information about any terms of the tariff. The information
transmission capability, price, individual third party transmission contained in this log is to be posted on
curtailments, storage, ancillary services, transactions or potential transmission the OASIS or Internet Web site within
balancing, maintenance activity, arrangements. 24 hours of when a transmission
capacity expansion plans, or similar (7) Neither a Transmission Provider Provider exercises its discretion under
information) through non-public nor an employee of a Transmission any terms of the tariff.
communications conducted off the Provider is permitted to use anyone as (ii) Natural gas Transmission
OASIS or Internet Web site, through a conduit for sharing information Providers must maintain a written log of
access to information not posted on the covered by the prohibitions of waivers that the natural gas
OASIS or Internet Web site that is not § 358.5(b)(1) and (2) with a Marketing or Transmission Provider grants with
contemporaneously available to the Energy Affiliate. A Transmission respect to tariff provisions that provide
public, or through information on the Provider may share information covered for such discretionary waivers and
OASIS or Internet Web site that is not by § 358.5(b)(1) and (2) with employees provide the log to any person requesting
at the same time publicly available. permitted to be shared under
it within 24 hours of the request.
(2) A Transmission Provider may not § 358.4(a)(4), (5) and (6) provided that
share any information, acquired from such employees do not act as a conduit (5) The Transmission Provider may
non-affiliated transmission customers or to share such information with any not, through its tariffs or otherwise, give
potential non-affiliated transmission Marketing or Energy Affiliates. preference to its Marketing or Energy
customers, or developed in the course of (8) A Transmission Provider may Affiliate, over any other wholesale
responding to requests for transmission share transmission information covered customer in matters relating to the sale
or ancillary service on the OASIS or by § 358.5(a) and (b)(1) with Planning or purchase of transmission service
Internet Web site, with employees of its Employees to the extent those (including, but not limited to, issues of
Marketing or Energy Affiliates, except to employees need that information to price, curtailments, scheduling, priority,
the limited extent information is direct, organize or carry out Integrated ancillary services, or balancing).
required to be posted on the OASIS or Resource Planning, provided that such (d) Discounts. Any offer of a discount
Internet Web site in response to a employees do not act as a conduit to for any transmission service made by
request for transmission service or share such information with any the Transmission Provider must be
ancillary services. Marketing or Energy Affiliates. posted on the OASIS or Internet Web
(3) If an employee of the Transmission (9) A Transmission Provider may site contemporaneous with the time that
Provider discloses information in a share transmission information covered the offer is contractually binding. The
manner contrary to the requirements of by § 358.5(a) and (b)(1) with posting must include: the name of the
§ 358.5(b)(1) and (2), the Transmission Competitive Solicitation Employees to customer involved in the discount and
Provider must immediately post such the extent those employees need that whether it is an affiliate or whether an
information on the OASIS or Internet information to direct, organize, or affiliate is involved in the transaction,
Web site. execute Competitive Solicitations, the rate offered; the maximum rate; the
(4) A non-affiliated transmission provided that such employees do not act time period for which the discount
customer may voluntarily consent, in as a conduit to share such information would apply; the quantity of power or
writing, to allow the Transmission with any Marketing or Energy Affiliates. gas upon which the discount is based;
Provider to share the non-affiliated (c) Implementing tariffs. (1) A the delivery points under the
customer’s information with a Transmission Provider must strictly transaction; and any conditions or
Marketing or Energy Affiliate. If a non- enforce all tariff provisions relating to requirements applicable to the discount.
affiliated customer authorizes the the sale or purchase of open access The posting must remain on the OASIS
Transmission Provider to share its transmission service, if these tariff or Internet Web site for 60 days from the
information with a Marketing or Energy provisions do not permit the use of date of posting.
Affiliate, the Transmission Provider discretion.
must post notice on the OASIS or (2) A Transmission Provider must [FR Doc. E7–1118 Filed 1–26–07; 8:45 am]
Internet Web site of that consent along apply all tariff provisions relating to the BILLING CODE 6717–01–P

Proposed Rule: Standards of Conduct: Natural Gas Pipeline Transmission Providers

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3958 Federal Register / Vol. 72, No.

18 / Monday, January 29, 2007 / Proposed Rules

The Proposed Amendment § 39.13 [Amended] Affected ADs

TABLE 1.—SERVICE BULLETINS

777–57A0050 ............................................................................................................................................ Original ............. January 26, 2006.

CFR 39.19. Secretary, 888 First Street, NE.,

would need access to non-public and utilities treat integrated resource

information pursuant to § 358.5(b)(8) or who control or affiliation. 18 CFR 358.3(c).

Magalie R. Salas, the transmission of electric energy in facilities are located.

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