[Federal Register Volume 78, Number 3 (Friday, January 4, 2013)]
[Proposed Rules]
[Pages 679-687]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-31085]
-----------------------------------------------------------------------
DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
18 CFR Parts 2 and 380
[Docket No. RM12-11-000]
Revisions to the Auxiliary Installations, Replacement Facilities,
and Siting and Maintenance Regulations
AGENCY: Federal Energy Regulatory Commission, DOE.
ACTION: Notice of Proposed Rulemaking.
-----------------------------------------------------------------------
SUMMARY: The Natural Gas Act (NGA) requires that prior to the
construction or extension of any natural gas facilities, the Federal
Energy Regulatory Commission (Commission) must issue a certificate that
authorizes a natural gas company to undertake the proposed activity.
However, under the Commission's regulations, the construction of
auxiliary installations or replacement facilities, while subject to the
Commission's NGA jurisdiction, are not treated as the construction or
extension of facilities, and thus do not require certificate
authorization. The Commission proposes to revise its regulations to
clarify that all activities
[[Page 680]]
related to the construction of auxiliary installations and replacement
facilities must take place within a company's certificated right-of-way
using previously approved work spaces. In addition, the Commission
proposes to add landowner notification requirements for auxiliary
installations, replacement facilities, and other jurisdictional
activities performed within the right-of-way.
DATES: Comments are due March 5, 2013.
ADDRESSES: Comments, identified by docket number, may be filed in the
following ways:
Electronic Filing through: http://www.ferc.gov. Documents
created electronically using word processing software should be filed
in native applications or print-to-PDF format and not in a scanned
format.
Mail/Hand Delivery: Those unable to file electronically
may mail or hand-deliver comments to: Federal Energy Regulatory
Commission, Secretary of the Commission, 888 First Street NE.,
Washington, DC 20426.
Instructions: For detailed instructions on submitting comments and
additional information on the rulemaking process, see the Comment
Procedures Section of this document.
FOR FURTHER INFORMATION CONTACT:
Katherine Liberty, Office of the General Counsel, Federal Energy
Regulatory Commission, 888 First Street NE., Washington, DC 20426,
(202) 502-6491, katherine.liberty@ferc.gov;
Gordon Wagner, Office of the General Counsel, Federal Energy Regulatory
Commission, 888 First Street NE., Washington, DC 20426, (202) 502-8947,
gordon.wagner@ferc.gov;
Douglas Sipe, Office of Energy Projects, Federal Energy Regulatory
Commission, 888 First Street NE., Washington, DC 20426, (202) 502-8837,
douglas.sipe@ferc.gov;
Howard Wheeler, Office of Energy Projects, Federal Energy Regulatory
Commission, 888 First Street NE., Washington, DC 20426, (202) 502-8688,
howard.wheeler@ferc.gov.
SUPPLEMENTARY INFORMATION:
141 FERC ] 61,228
December 20, 2012.
1. On April 2, 2012, the Interstate Natural Gas Association of
America (INGAA) requested clarification of section 2.55 of the
Commission's regulations,\1\ which defines facilities that may be
added, altered, or replaced under a company's existing Natural Gas Act
(NGA) section 7(c) certificate authorization, without the need for any
additional authorization.\2\ INGAA states that in discussions with
pipelines and in industry meetings, Commission staff has expressed the
position that under section 2.55(a), in undertaking auxiliary
installations, companies must stay within their existing rights-of-way,
with construction activities limited to the work space that was
previously used. INGAA disagrees with this restriction, arguing that in
the past, auxiliary installation activities have not been constrained
in this way; therefore, to now impose right-of-way and work space
constraints would amount to rulemaking without the opportunity for
notice and comment, contrary to the requirements of the Administrative
Procedure Act (APA).\3\ Pursuant to section 385.207(a)(4) of the
Commission's Rules of Practice and Procedure, INGAA requests the
Commission affirm that no right-of-way or work space limitations apply
to auxiliary installations under section 2.55(a).
---------------------------------------------------------------------------
\1\ 18 CFR 2.55 (2012).
\2\ On May 2, 2012, MidAmerican Energy Pipeline Group (which
includes Kern River Gas Transmission Company and Northern Natural
Gas Company) filed a motion to intervene and comments in support of
INGAA's petition.
\3\ 5 U.S.C. 553 (2006).
---------------------------------------------------------------------------
I. Background
2. Section 7(c)(1)(A) of the NGA requires a natural gas company to
have certificate authorization for the ``construction or extension of
any facilities.'' \4\ In order to ``avoid the filing and consideration
of unnecessary applications for certificates,'' \5\ section 2.55 of the
Commission's regulations establishes that for the purposes of NGA
section 7(c), ``the word facilities as used therein shall be
interpreted to exclude'' auxiliary installations and replacement
facilities.\6\ Thus, although auxiliary installations and replacement
facilities remain subject to the Commission's NGA jurisdiction, they do
not require section 7(c) certificate authorization. Section 2.55 was
implemented to reduce the burden that would otherwise be imposed on
companies and the Commission by requiring a full, formal case-specific
section 7 proceeding for minor, routine modifications to an existing or
proposed interstate transportation system.\7\
---------------------------------------------------------------------------
\4\ 15 U.S.C. 717f(c)(1)(A) (2006).
\5\ Filing of Applications for Certificates of Public
Convenience and Necessity, Notice of Proposed Rulemaking, 13 FR
6253, at 6254 (October 23, 1948).
\6\ 18 CFR 2.55 (2012).
\7\ Section 2.55 went into effect in 1948, prior to (and
presaging) the Commission's blanket certificate program, which went
into effect in 1982.
---------------------------------------------------------------------------
3. Section 2.55(a) excludes facilities which are ``merely auxiliary
or appurtenant to an authorized or proposed pipeline transmission
system'' and are installed ``only for the purpose of obtaining more
efficient or more economical operation of the authorized or proposed
transmission facilities,'' such as ``[v]alves; drips; pig launchers/
receivers; yard and station piping; cathodic protection equipment; gas
cleaning, cooling and dehydration equipment; residual refining
equipment; water pumping, treatment and cooling equipment; electrical
and communication equipment; and buildings.''
4. Originally, natural gas companies were not required to notify
the Commission in advance of constructing auxiliary installations.
However, in 1999 the Commission expressed the concern that adding
auxiliary facilities to an authorized, but not yet completed project,
without notifying the Commission of the auxiliary facilities, would not
afford the Commission the opportunity to assess the auxiliary
facilities' environmental impacts, impacts which, when combined with
the impacts of the authorized facilities, could potentially alter the
Commission's conclusions regarding the overall environmental impact of
the pending project. As a result, Order No. 603 \8\ revised section
2.55(a)(2) to require that any natural gas company constructing
auxiliary installations on or at the same time as the construction of a
certificated project must provide a description of the auxiliary
facility and its location to the Commission 30 days in advance of its
installation.\9\ Likewise, if any natural gas company plans to
construct an auxiliary facility in conjunction with a proposed project,
the auxiliary facility must be described in the application's
environmental report, as required by section 380.12 of the Commission's
regulations, or in a supplemental filing while the application is
pending.\10\ The Commission explained these advance notification
requirements are necessary because certain aboveground auxiliary
installations involve substantially different environmental impacts
than a
[[Page 681]]
pipeline or storage facility, and these different impacts could be of
concern to affected landowners and the Commission.\11\
---------------------------------------------------------------------------
\8\ Revision of Existing Regulations Under Part 157 and Related
Sections of the Commission's Regulations Under the Natural Gas Act,
Order No. 603, 64 FR 26572, at 26574 (May 14, 1999), FERC Stats. &
Regs., Regulations Preambles July 1996-December 2000 ] 31,073
(1999), order on reh'g, Order No. 603-A, 64 FR 54522 (October 7,
1999), FERC Stats. & Regs., Regulations Preambles July 1996-December
2000 ] 31,081 (1999), order on reh'g, Order No. 603-B, 65 FR 11462
(March 3, 2000), FERC Stats. & Regs., Regulations Preambles July
1996-December 2000 ] 61,094 (2000).
\9\ See 18 CFR 2.55(a)(2)(ii) (2012).
\10\ See 18 CFR 2.55(a)(2)(iii) (2012).
\11\ Revisions to Regulations Governing NGPA Section 311
Construction and the Replacement of Facilities, Order No. 544, 57 FR
46487 (October 9, 1992), FERC Stats. & Regs., Regulations Preambles
January 1991--June 1996 ] 31,951 (1992), order on reh'g, Order No.
544-A, 58 FR 57730 (October 27, 1993), FERC Stats. & Regs.,
Regulations Preambles January 1991--June 1996 ] 30,983 (1993).
---------------------------------------------------------------------------
5. Section 2.55(b) permits natural gas companies to replace
physically deteriorated or obsolete facilities, including replacing
existing facilities that have or will soon be physically deteriorated
or obsolete, so long as the replacement will not result in a reduction
or abandonment of service and will have a substantially equivalent
designed delivery capacity.\12\ Larger replacements require that a
description of the project be submitted to the Commission 30 days in
advance of initiating construction, while smaller replacements may go
forward without any advance notice.\13\ Such replacements may go
forward without case-specific or blanket certificate authorization.
---------------------------------------------------------------------------
\12\ 18 CFR 2.55(b) (2012).
\13\ Of course all jurisdictional activities--whether subject to
section 2.55 or section 7(c)--are subject to all other applicable
federal, state, and local requirements.
---------------------------------------------------------------------------
6. In Order No. 603, the Commission specified that all replacement
facilities must be constructed in the certificated right-of-way using
the same temporary work space that was used to construct the existing
facilities.\14\ The Commission reasoned that section 2.55(b)
replacements ``should only involve basic maintenance or repair to
relatively minor facilities,'' where it has been determined that no
significant impact to the environment would occur.\15\ The Commission
suggested that if a natural gas company wanted to use land outside of
the original right-of-way, it rely on its blanket certificate authority
to do so.\16\
---------------------------------------------------------------------------
\14\ Order No. 603, FERC Stats. & Regs. ] 31,073, 64 FR 26572 at
26574-76 and 18 CFR 2.55(b) (2012).
\15\ Order No. 603-A, FERC Stats. & Regs. ] 31,081, 64 FR 54522
at 54524.
\16\ Order No. 603, FERC Stats. & Regs. ] 31,073, 64 FR 26572 at
26580.
---------------------------------------------------------------------------
II. Proposed Regulatory Revisions
7. As discussed in more detail below, in response to the concerns
expressed by INGAA in its petition, the Commission now proposes to
revise section 2.55(a) covering auxiliary installations to clarify that
auxiliary facilities must be located within the certificated permanent
right-of-way or authorized facility site and must use the same
temporary work space that was used to construct the existing
facilities. This is consistent with the Commission's 2.55(b) provisions
(as adopted in Order No. 603), which specify that replacement
facilities ``will be located in the same right-of-way or on the same
site as the facilities being replaced, and will be constructed using
the temporary work space used to construct the original facility.''
\17\ In restricting section 2.55 activities to the right-of-way and
work space authorized in conjunction with the existing facilities, we
are doing no more than reiterating that the limitations imposed by the
Commission in approving the facilities continue to apply to auxiliary
and replacement activities associated with those facilities. This
ensures that the environmental and landowner impacts attributable to
auxiliary and replacement activities conducted under this regulation
without prior Commission authorization remain within the scope of
impacts studied and addressed in our review and authorization of the
underlying facilities.
---------------------------------------------------------------------------
\17\ 18 CFR 2.55(b)(1)(ii) (2012). See also Arkla Energy
Resources Company, 67 FERC ] 61,173, at 61,516 (1994) (Arkla), in
which the Commission, prior to Order No. 603's revision of the
2.55(b)(1)(ii) regulations to specify that replacement facilities
must be in the same right-of-way, explained that although the then-
applicable regulations and case law did not explicitly restrict
replacement facilities to the existing right-of-way:
[R]eplacement facilities must be constructed within the existing
right-of-way. The reason is simple. The authority to replace a
facility and to establish a right-of-way should be limited by the
terms and locations delineated in the original construction
certificate. Thus, a certificate holder that later establishes a new
right-of-way for purposes of [a section 2.55(b)] replacement engages
in an unauthorized activity which is outside the parameters of the
original certificate order.
---------------------------------------------------------------------------
8. With respect to this section 2.55(b)(1)(ii) requirement, we
propose to substitute ``existing facility'' for ``original facility.''
We do so in the recognition that over time, the original facility may
have undergone modifications, such as auxiliary installations,
replacements, or emergency repairs. More significant modifications to
an original facility may have been undertaken pursuant to blanket
certificate authority, in particular where a company has relied on our
Part 157, Subpart F, provisions to establish a new permanent right-of-
way and new temporary work spaces. Further, we note that this proposed
change will render existing section 2.55(b)(1)(ii) consistent with
existing section 2.55(a)(2)(i) and section 2.55(b)(1) and proposed
section 2.55(a)(1)(i), all of which refer to ``existing'' rather than
``original'' facilities.
9. Commission staff has also received numerous requests from
landowners, asking that companies be required to notify landowners
prior to entering and undertaking activities on their property. In
response, the Commission proposes to add a landowner notification
requirement for construction activities conducted under section 2.55
for auxiliary installations and replacement facilities, as well as for
any jurisdictional activities undertaken to meet the siting and
maintenance requirements of section 380.15 of the Commission's
regulations. To guarantee that landowners are notified in advance of
any construction or maintenance activity planned for their property,
under proposed sections 2.55(c) and 380.15(c), natural gas companies
will have to notify affected landowners at least 10 days prior to
commencing any such activity.
A. Clarifying and Updating Regulations To Conform to Commission
Practice and Policy
1. Comments
10. INGAA contends that during discussions with natural gas
companies and in industry meetings, Commission staff has stated that
under section 2.55(a), auxiliary installations are limited to
activities that take place within existing rights-of-way where the
original work space is used. INGAA maintains that Commission staff's
position substantially changes the meaning of section 2.55(a), as it
would subject auxiliary installations to the same right-of-way and work
space requirements that apply to replacement facilities under section
2.55(b)(ii). INGAA stresses that section 2.55(a) does not have similar
right-of-way and work space constraints.
11. INGAA argues that, historically, section 2.55(a) auxiliary
installations and section 2.55(b) replacement facilities have received
different treatment.\18\ INGAA states that auxiliary installations
traditionally have not been limited to existing rights-of-way or
original work spaces. INGAA notes that
[[Page 682]]
while Order No. 603 \19\ specifically stated that replacement
facilities must be constructed within the existing right-of-way, the
Commission was silent on applying that same requirement to auxiliary
installations.
---------------------------------------------------------------------------
\18\ INGAA sites to two letters from Commission staff, one
stating that replacement facilities outside of the right-of-way must
be initiated under a case-specific NGA section 7 certificate
proceeding, and the other stating that auxiliary installations
constructed outside of the existing right-of-way do not need
additional Commission authorization. See INGAA's April 2, 2012
filing at nn. 18 &19. While Commission staff appropriately stated
that replacement facility construction cannot occur outside of the
existing right-of-way or previously used work space, staff was
incorrect in stating that auxiliary installations outside of the
right-of-way are permissible.
\19\ Order No. 603, FERC Stats. & Regs. ] 31,073, 64 FR 26572 at
26575.
---------------------------------------------------------------------------
12. INGAA states that under Commission staff's current position, an
auxiliary facility, no matter how small and environmentally
insignificant, which would extend beyond the existing right-of-way or
original work space would require NGA section 7(c) certificate
authorization. INGAA contrasts this with a replacement project that no
matter how large and environmentally adverse, could proceed under
blanket certificate authority, provided it meets the Part 157, Subpart
F, regulatory requirements. INGAA characterizes this treatment as
nonsensical. By adding a right-of-way or work space limitation to
section 2.55(a) auxiliary installations, INGAA contends the Commission
would be imposing a substantial burden on companies seeking to maintain
their jurisdictional facilities and services.
2. Commission Response
13. Section 2.55 permits natural gas companies to make certain
routine modifications and additions to their jurisdictional facilities
without the need to invoke case-specific or blanket section 7(c)
certificate authorization. However, as the Commission has previously
stated, ``[a]cquiring additional land for construction activities is a
section 7 activity and, therefore, does not qualify for the section
2.55 exemption.'' \20\ Consequently, the Commission proposes to amend
section 2.55(a) to clarify that auxiliary installations must be
constructed within the certificated permanent right-of-way or
authorized facility site and must use the same temporary work space
used to construct the existing facility.
---------------------------------------------------------------------------
\20\ See Landowner Notification, Expanded Categorical
Exclusions, and Other Environmental Filing Requirements, Notice of
Proposed Rulemaking, Order No. 609, 64 FR 27717, at 27722 (May 21,
1999) FERC Stats. & Regs. ] 32,540 (1999).
---------------------------------------------------------------------------
14. All section 2.55 facilities are fully jurisdictional. Because
the originally certificated facilities had undergone an environmental
review, the Commission determined there was no need to subject the
comparatively minor modifications to these facilities permitted under
section 2.55 to the same scrutiny.\21\ Requiring that auxiliary
installations must conform to the originally specified certificate
conditions with respect to construction and location is consistent with
the Commission's treatment of replacement facilities under section
2.55(b).\22\
---------------------------------------------------------------------------
\21\ As noted above, the ancillary nature of these secondary
facilities is indicated by section 2.55(a), which describes them as
``merely auxiliary or appurtenant'' and ``only for the purpose of
obtaining more efficient or more economical operation of the
authorized or proposed transmission facilities,'' and section
2.55(b) which limits replacement facilities to those that ``will
have a substantially equivalent designed capacity.''
\22\ See Order No. 603, FERC Stats. & Regs. ] 31,073, 64 FR
26572 at 26575.
---------------------------------------------------------------------------
15. In Order No. 603, the Commission added Appendix A to Part 2 to
provide guidance for the construction of replacement facilities. Order
No. 603 did not discuss auxiliary facilities, as no party raised any
issue regarding them. Thus, the Commission saw no need to discuss
whether the construction and location of auxiliary facilities must fall
within the footprint of the existing facilities. Nothing in Order No.
603 evinced an intent to permit auxiliary facilities outside of
previously approved boundaries, i.e., outside of an area that had been
previously studied when the Commission considered the environmental
impacts of the originally proposed project in fulfillment of its
National Environmental Policy Act (NEPA) obligations.\23\ We noted that
section 2.55(a) auxiliary facilities, like section 2.55(b) replacement
facilities, should only include basic maintenance activities and the
addition of minor facilities so as to ensure that all section 2.55
activities will have no significant adverse environmental or economic
impacts.\24\
---------------------------------------------------------------------------
\23\ 42 U.S.C. 4321-4347 (2006).
\24\ See Order No. 603-A, FERC Stats. & Regs. ] 31,081, 64 FR
54522 at 54524.
---------------------------------------------------------------------------
16. The authority to replace, construct, or maintain natural gas
facilities is limited by the terms and locations delineated in the
original certificate. These terms include the project's approved plans
and procedures, e.g., the Commission staff's Upland Erosion Control
Revegetation and Maintenance Plan and Wetland and Waterbody
Construction and Mitigation Procedures, as required by section 380.12
of the Commission's regulations, as well as any conditions relating to
construction methods and restoration obligations. So long as an
auxiliary or replacement facility will be located within an existing
right-of-way, and make use of the previously used work space, and
comply with all the conditions of the original certificate, a natural
gas company can rely on section 2.55 for its construction activities.
However, any activity that would require a new permanent right-of-way
or new temporary work space, i.e., any activity that would require any
new property rights, would be beyond the scope of section 2.55, and a
company would require an alternative source of authorization.\25\ For
activities that cannot qualify under section 2.55, a company may seek
case-specific certificate authorization or rely on its blanket
authority.\26\
---------------------------------------------------------------------------
\25\ See, e.g., Arkla Energy Resources, 67 FERC ] 61,173, at
61,516 (1994) (Arkla). Note that it is irrelevant whether a company
is able to obtain new property rights by negotiation, since absent
the opportunity for the Commission to evaluate the potential
environmental impacts of construction outside a certificated
project's prescribed boundaries, i.e., outside an area the
Commission has previously reviewed and approved, the Commission
cannot meet its NEPA obligations or ensure the activity is in the
public interest.
\26\ A natural gas company may rely on blanket certificate
authority for the construction of an auxiliary or replacement
facility so long as the installation meets the blanket certificate
requirements under Part 157 of the Commissions regulations (i.e.
that the facility is an eligible facility and satisfies any cost
constraints and standard environmental conditions). Note that all
activities undertaken pursuant to blanket authority, but for certain
limited exceptions, require a company to provide written notice to
affected landowners 45 days prior to commencing the activity. See 18
CFR 157.203(d) (2012).
---------------------------------------------------------------------------
B. Environmental Effects of Auxiliary Installations
1. Comments
17. INGAA states that auxiliary installations are smaller by nature
and have limited environmental and other impacts when compared to
replacement facilities, since replacements can involve the removal and
replacement of extensive mainline facilities and significant adverse
effects on the environment.
18. INGAA contends that implementing right-of-way and work space
limitations for auxiliary installations would eliminate the ability of
natural gas companies to install many of the facilities expressly
identified in section 2.55(a). INGAA states that cathodic protection,
electrical and communication equipment, pig launchers and receivers,
and buildings typically extend beyond the existing right-of-way and
require additional work space for their installation. INGAA notes that
since eminent domain is not available for section 2.55(a)
installations, any additional work space can be obtained only through
negotiations with landowners.
2. Commission Response
19. Implicit in the section 2.55 exemption from case-specific or
blanket section 7(c) certificate authorization is the presumption that
all auxiliary installations and replacement facilities will have
limited adverse environmental
[[Page 683]]
and economic impacts, since it would be inconsistent with the public
interest to permit projects with potentially significant adverse
impacts to go forward without notice, opportunity for comment, and
appropriate review.
20. We acknowledge that certain types of auxiliary installations,
such as valves, involve minor facilities that do not merit an in-depth
review, as the environmental and economic impacts are minimal. However,
this is not the case for auxiliary installations that are more
extensive or extend beyond the reviewed and approved boundaries of an
existing facility. For example, INGAA noted in its filing that
conventional ground bed installations for cathodic protection commonly
involve construction outside of the right-of-way. We note that as an
alternative to the ``conventional'' method of installation, deep-well
anode bed installations, which may not require disturbance outside of
the right-of-way, are also in use and may offer other benefits such as
greater reliability of corrosion protection. INGAA also cites
communication towers for the monitoring of electrical and communication
equipment as auxiliary installations that involve ground-disturbing
activity and are commonly located outside of the existing right-of-way.
21. In Arkla, the Commission held that the environmental impact of
a section 2.55(b) replacement facility is insignificant when the
facility is ``located within a compressor station or a natural gas
pipeline's right-of-way'' \27\--i.e. within the previously studied,
specific boundaries of a certificated project. In contrast,
construction activities outside of the right-of-way have the potential
to impose unknown and unmitigated impacts on the environment, and
therefore should be subject to an environmental assessment or an
environmental impact statement.\28\ The same rationale holds true for
section 2.55(a) auxiliary installations. The exclusion of auxiliary
installations from NGA section 7(c) certificate requirements was based
on the fact that the original facilities were constructed within a
previously studied, precisely defined area. Any deviations from the
certificate conditions applicable to the original project require
additional scrutiny and additional authorization.
---------------------------------------------------------------------------
\27\ 67 FERC ] 61,173, at 61,516-17, n.4 (1994) (citing
Regulations Implementing National Environmental Policy Act of 1969,
Order No. 486, 52 FR 47897 (December 17, 1987), FERC Stats. & Regs.,
Regulations Preambles 1986-1990 ] 30,783, at 30,942 (1987)).
\28\ See id. at 61,517.
---------------------------------------------------------------------------
22. A section 2.55 facility located outside of the existing right-
of-way or using land outside the previously used work space raises
environmental concerns not contemplated in the original section 7(c)
certificate proceeding, such as land use, erosion, sediment control,
impacts on streams and soils, visual impacts, and threatened and
endangered species. Therefore, to ensure the review of, and if need be,
the mitigation of adverse environmental impacts caused by activities
outside of an existing right-of-way or prior work space, a company
cannot rely on section 2.55, but must instead rely on case-specific or
blanket section 7(c) authorization. Regardless of whether a facility is
constructed pursuant to section 2.55 or NGA section 7(c), a pipeline is
required to obtain the necessary environmental approvals and
construction permits from federal and state agencies.
23. In addition, a natural gas company cannot assume that merely
because land was disturbed within the certificated right-of-way and
work spaces, the construction of an auxiliary installation within the
authorized boundaries will not disrupt the environment. Thus, as noted
above, all environmental or construction conditions (i.e. compliance
with the project's approved plans and procedures, e.g., right-of-way
revegetation, monitoring, and maintenance) that were included as
conditions attached to the original certificate remain in effect until
the certificate is abandoned. These conditions do not expire once the
facility goes into service and thus are applicable to all section 2.55
and section 380.15 activities.
24. When, in conformity with the clarified section 2.55(a)
requirements, a natural gas company is obliged to file an application
for authorization of a relatively minor installation outside of an
existing right-of-way or work space, it is most likely that the blanket
certificate will apply and the effort necessary to satisfy
documentation and information requirements will be relatively minor
(particularly so when an installation can qualify for section
157.203(b) automatic authorization). Further, to alleviate any concerns
that the right-of-way or work space restriction will interrupt service
to customers, a pipeline may use the emergency regulations under Part
284 Subpart I and/or may file, under emergency conditions, an
application pursuant to section 157.17 of the regulations for a
``temporary certificate authorizing the construction and operation of
extensions of existing facilities * * * that may be required to assure
maintenance of adequate service or to service particular customers.''
\29\
---------------------------------------------------------------------------
\29\ See, e.g., NorAm Energy Corporation, 70 FERC ] 61,030 at
61,100 (1995) (citing 18 CFR 157.17) (2012).
---------------------------------------------------------------------------
C. Compliance With the Administrative Procedure Act
1. Comments
25. INGAA argues that Commission staff's position that auxiliary
installations are limited to the originally certificated right-of-way
and work space amounts to an informal rulemaking, without the
opportunity for notice and comment, a violation of the requirements of
the APA.\30\
---------------------------------------------------------------------------
\30\ 5 U.S.C. 553 (2006).
---------------------------------------------------------------------------
2. Commission Response
26. We disagree. Commission staff's actions are in accord with the
requirements of the APA. Staff's position is merely a clarification of
a natural gas company's existing requirements, requirements imposed as
specific conditions to a certificate authorization. This is not a new
policy. As stated above, section 2.55 auxiliary and replacement
facilities have always been confined by right-of-way and work space
limitations, since the certificate authorizing a natural gas project
only covers project facilities built within the right-of-way and using
the work space authorized in the certificate. Thus, project activities
outside the authorized right-of-way or work space would violate
conditions applicable to the certificate. Because of these inherent
certificate limitations, the Commission saw no need to amend section
2.55 until INGAA's requested clarification. As a result, we are
initiating this Notice of Proposed Rulemaking to clarify that section
2.55(a) auxiliary installations must be constructed within the existing
right-of-way or authorized facility site using the same temporary work
space used to construct the existing facility.\31\
---------------------------------------------------------------------------
\31\ In any event, staff advice is not binding on the
Commission--see 18 CFR 388.104 (2012)--thus, such advice is not
subject to APA rulemaking procedures. A company seeking a definitive
Commission ruling must apply for one, as INGAA has done.
---------------------------------------------------------------------------
D. Landowner Notification for Activities Conducted Under Section 2.55
and Section 380.15
1. Comments
27. Commission staff has received numerous requests from landowners
that we require companies to notify landowners in advance of any
activity that will take place on their land.
[[Page 684]]
2. Commission Response
28. We propose to add landowner notification requirements for both
auxiliary installations and replacement facilities under section 2.55
and for siting and maintenance activities under section 380.15. Under
proposed sections 2.55(c) and 380.15(b)(1), a natural gas company must
notify affected landowners at least 10 days prior to commencing
construction. The notification should include: (1) A brief description
of the activity to be conducted or facilities to be constructed/
replaced and the effects that the activities are expected to have on
the landowner's property; (2) the name and phone number of the company
representative that is knowledgeable about the project; and (3) a
description of the Commission's Dispute Resolution Service Helpline, as
explained in section 1b.21(g) of the Commission's regulations, and the
Dispute Resolution Service Helpline number.
29. If the landowner has further questions concerning construction
or maintenance activities, the landowner can contact the company
representative for more details. If the landowner needs further
information concerning the Commission's role in these types of
projects, the landowner can contact the Commission's Dispute Resolution
Service Helpline.
30. We also propose to define ``affected landowners'' as owners of
property interests, as noted in the most recent tax notice, whose
property (1) is directly affected (i.e., crossed or used) by the
proposed activity, including all rights-of-way, facility sites, access
roads, pipe and contractor yards, and temporary workspace, or (2) abuts
either side of an existing right-of-way or facility site, or abuts the
edge of a proposed right-of-way or facility site which runs along a
property line in the area in which the facilities would be constructed,
or contains a residence within 50 feet of the proposed construction
work area.
III. Information Collection Statement
31. The Paperwork Reduction Act (PRA) \32\ requires each federal
agency to seek and obtain Office of Management and Budget (OMB)
approval before undertaking a collection of information directed to ten
or more persons or contained in a rule of general applicability.\33\
The OMB's regulations implementing the PRA require approval of certain
information collection requirements imposed by agency rules.\34\ Upon
approval of a collection of information, OMB will assign an OMB control
number and an expiration date. Respondents subject to the filing
requirements of an agency rule will not be penalized for failing to
respond to the collection of information unless the collection of
information displays a valid OMB control number.
---------------------------------------------------------------------------
\32\ 44 U.S.C. 3501-3520 (2006).
\33\ OMB's regulations at 5 CFR 1320.3(c)(4)(i) (2012) require
that ``[a]ny recordkeeping, reporting, or disclosure requirement
contained in a rule of general applicability is deemed to involve
ten or more persons.''
\34\ 5 CFR part 1320 (2012).
---------------------------------------------------------------------------
32. The Commission is submitting the proposed reporting
requirements to OMB for its review and approval. The Commission
solicits comments on the proposed modifications, the accuracy of burden
estimates, ways to enhance the quality, utility, and clarity of the
information to be collected, and any suggested methods for minimizing
respondents' burden.
33. The only entities affected by this rule would be natural gas
companies under the Commission's jurisdiction. The information
collection requirements in this Final Rule are identified as follows.
34. FERC-577, ``Gas Pipeline Certificates: Environmental Impact
Statements,'' identifies the Commission's information collections
relating to the requirements set forth in NEPA and Parts 2, 157, 284,
and 380 of the Commission's regulations. Applicants have to conduct
appropriate studies which are necessary to determine the impact of the
construction and operation of proposed jurisdictional facilities on
human and natural resources, and the measures which may be necessary to
protect the values of the affected area. These information collection
requirements are mandatory.
35. Because this proposed rule adds a landowner notification
requirement in section 2.55(c) and section 380.15(c) for activities
undertaken pursuant to these sections, the overall burden on the
industry will increase. However, because natural gas companies subject
to our jurisdiction must already notify landowners in conjunction with
section 3 projects and section 7 applications and when conducting
activities under part 157 of our regulations, no new technology would
be needed and no start-up costs would be incurred. Further, even
without the notification requirement proposed herein, companies
routinely inform landowners prior to coming onto their property, both
as a courtesy and to avoid conflicts in landowner and company
activities. Thus, the proposed notification is expected to be
consistent with some companies' current practices, and consequently to
impose little or no additional obligation on such companies.
36. In 1999, in estimating the landowner notification burden in
Order No. 609,\35\ we found companies would need four hours to identify
affected landowners and prepare and distribute information describing
the proposed project. Given advances in database management since then,
and given that section 2.55 and section 380.15 activities generally
involve activities that are smaller than those that go forward under
blanket certificate authority, we anticipate companies will need two
hours to meet the proposed landowner notification requirement.
---------------------------------------------------------------------------
\35\ See note 20.
---------------------------------------------------------------------------
37. While companies are required to file annual reports of
replacement facilities under 2.55(b), no such reports are required for
ancillary installations under 2.55(a). Thus, we have no data upon which
to base an estimate of activities under 2.55(a). In view of this,
Commission staff asked for information on activities under 2.55(a) from
a small representative sample (less than ten) of jurisdictional
companies and we have extrapolated our estimate based on company
responses. We estimate that on average, approximately 6,500 auxiliary
installation projects are undertaken annually.
38. Companies file an annual report itemizing all section 2.55(b)
replacement activities. Our review of the more recent annual reports
indicate that companies undertake, in total, approximately 500 section
2.55(b) projects per year.
39. Section 380.15 siting and maintenance activities, like
activities under 2.55(a), do not require companies to submit an annual
report. These activities are generally minor and planned for well in
advance and cover a wide variety of efforts, e.g., physical up-keep of
above-ground facilities and right-of-way vegetation maintenance.
Further, any particular company's activities on its right-of-way can
depend upon changing conditions such as maintenance initiatives,
population density, and even weather. Because of this variety of
possible activities and their minor nature we have estimated that, for
all companies nationwide, there will be a total of approximately three
times as many activities as take place under section 2.55(a) which
would require a landowner notification, i.e., in the aggregate, 19,500
siting and
[[Page 685]]
maintenance activities that could require a landowner notification.
40. We estimate the proposed additional notification burden that
the proposal would impose in the table below.
----------------------------------------------------------------------------------------------------------------
Annual number Annual number Number of
Proposed data collection of of filings per hours per Total annual
respondents respondent \36\ filing hours
----------------------------------------------------------------------------------------------------------------
FERC-577 (new requirement, proposed in 18 CFR 165 39.5 2 13,000
2.55(a))......................................
FERC-577 (new requirement, proposed in 18 CFR 165 3 2 1,000
2.55(b))......................................
FERC-577 (new requirement, proposed in 18 CFR 165 118 2 39,000
380.15).......................................
----------------------------------------------------------------
Total Annual Burden Hours.................. .............. ............... .............. 53,000
----------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------
\36\ This column reflects a rounded estimate for each
jurisdictional natural gas company, averaged over all 165 such
companies.
---------------------------------------------------------------------------
41. As discussed above, natural gas companies already conduct
landowner notifications for larger projects, and some companies also
routinely inform affected landowners in advance of undertaking
activities on their property as it is considered a ``best practice''
for facility and right-of-way management. Given that some companies
currently comply with the notification requirements proposed herein, we
believe that the actual industry-wide increase in burden will be
substantially less than what we have estimated here.
Information Collection Costs: The Commission seeks comments on the
costs to comply with these revised requirements. It has projected the
average cost for all respondents to be as follows: \37\
---------------------------------------------------------------------------
\37\ The cost figures are derived by multiplying the total hours
to prepare a response by an hourly wage estimate of $60 (based on
average civil engineer wages and benefit information obtained from
the Bureau of Labor Statistics' data at http://bls.gov/oes/current/naics4_221200.htm#17-0000 and http://www.bls.gov/news.release/ecec.nr0.htm rates).
---------------------------------------------------------------------------
$3,180,000.00 per year for all regulated entities;
$19,272.00 per year for each regulated entity.
Title: FERC-577.
Action: Proposed Revision.
OMB Control Nos.: 1902-0128.
Respondents: Natural gas pipeline companies.
Frequency of Responses: On occasion.
Necessity of Information: The requirement to notify landowners is
necessary for the Commission to carry out its NEPA responsibilities and
meet the Commission's objectives of addressing landowner and
environmental concerns fairly. The information provided to landowners
is intended to accommodate, to the extent possible, any concerns they
may have regarding a natural gas company's planning, locating,
clearing, right-of-way maintenance, and facility construction or
replacement activities on their property.
Internal Review: The Commission has reviewed the proposed revisions
and has determined that they are necessary. These proposed requirements
conform to the Commission's need for efficient information collection,
communication, and management within the energy industry. The
Commission has assured itself, by means of internal review, that there
is specific, objective support for the burden estimates associated with
the information collection requirements.
42. Interested persons may obtain information on the proposed
reporting requirements or submit comments by contacting the Federal
Energy Regulatory Commission, 888 First Street NE., Washington, DC
20426 (Attention: Information Clearance Officer, Office of the
Executive Director), by phone 202-502-8663, or by email to
DataClearance@ferc.gov). Comments on the proposed requirements may also
be sent to the Office of Information and Regulatory Affairs, Office of
Management and Budget, Washington, DC 20503 [Attention: Desk Officer
for the Federal Energy Regulatory Commission]. For security reasons,
comments should be sent by email to OMB at oira_submission@omb.eop.gov. Please reference OMB Control No. 1902-0128,
FERC-577, and Docket No. RM12-11 in your submission.
IV. Environmental Analysis
43. The Commission is required to prepare an environmental
assessment or an environmental impact statement for any action that may
have a significant adverse effect on the human environment. The
Commission has categorically excluded certain actions from these
requirements as not having a significant effect on the human
environment.\38\ Generally, the actions proposed to be taken here fall
within the categorical exclusions in the Commission's regulations that
are clarifying, corrective, or procedural and for information
gathering, analysis, and dissemination.\39\ Accordingly, an
environmental review is not necessary and has not been prepared in
connection with this proposed rulemaking.
---------------------------------------------------------------------------
\38\ 18 CFR 380.4 (2012).
\39\ 18 CFR 380.4(a)(1) and (5) (2012).
---------------------------------------------------------------------------
V. Regulatory Flexibility Act
44. The Regulatory Flexibility Act of 1980 (RFA) \40\ generally
requires a description and analysis of agency rules that will have a
significant economic impact on a substantial number of small entities.
The RFA mandates consideration of regulatory alternatives that
accomplish the stated objectives of a proposed rule and that minimize
any significant economic impact on a substantial number of small
entities. The Small Business Administration's (SBA) Office of Size
Standards develops the numerical definition of a small business.\41\
The SBA has established a size standard for natural gas pipeline
companies transporting natural gas, stating that a firm is small if its
annual receipts are less than $25.5 million.\42\
---------------------------------------------------------------------------
\40\ 5 U.S.C. 601-612 (2006).
\41\ 13 CFR 121.101 (2012).
\42\ 13 CFR 121.201 (2012), Subsector 486; see SBA's Table of
Small Business Size Standards, effective March 26, 2012, available
at: http://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf.
---------------------------------------------------------------------------
45. The proposed regulations impose requirements only on natural
gas companies subject to the Commission's jurisdiction, the majority of
which are not small businesses. Most companies regulated by the
Commission do not fall within the RFA's definition of a small entity.
Approximately 165 companies--nearly all of them large entities--would
be potential respondents subject to data collection FERC-577 reporting
requirements. For the year 2011 (the most recent year for which
information is available), only 15 companies not affiliated with larger
companies had annual revenues of less than $25.5 million. Moreover, the
proposed reporting requirements should have no meaningful economic
impact on companies--be they large or small--subject to the
Commission's regulatory jurisdiction. The Commission estimates that the
cost per small entity is $19,272 per year. The Commission does not
consider the estimated $19,272 impact
[[Page 686]]
per entity to be significant. Accordingly, pursuant to section 605(b)
of the RFA, the Commission certifies that this proposed rule should not
have a significant economic impact on a substantial number of small
entities.
VI. Comment Procedures
46. The Commission invites interested persons to submit comments on
the matters and issues proposed in this notice, including any related
matters or alternative proposals that commenters may wish to discuss.
Comments are due March 5, 2013. Comments must refer to Docket No. RM12-
11-000, and must include the commenter's name, the organization
represented, if applicable, and the commenter's address in the
comments.
47. The Commission encourages comments to be filed electronically
via the eFiling link on the Commission's Web site at http://www.ferc.gov. The Commission accepts most standard word processing
formats. Documents created electronically using word processing
software should be filed in native applications or print-to-PDF format
and not in a scanned format. Commenters filing electronically do not
need to make a paper filing.
48. Commenters that are not able to file comments electronically
must send an original of their comments to: Federal Energy Regulatory
Commission, Secretary of the Commission, 888 First Street NE.,
Washington, DC 20426.
49. All comments will be placed in the Commission's public files
and may be viewed, printed, or downloaded remotely as described in the
Document Availability section below. Commenters on this proposal are
not required to serve copies of their comments on other commenters.
VII. Document Availability
50. In addition to publishing the full text of this document in the
Federal Register, the Commission provides all interested persons an
opportunity to view and/or print the contents of this document via the
Internet through the Commission's Home Page (http://www.ferc.gov) and
in the Commission's Public Reference Room during normal business hours
(8:30 a.m. to 5:00 p.m. Eastern time) at 888 First Street NE., Room 2A,
Washington, DC 20426.
51. From the Commission's Home Page on the Internet, this
information is available on eLibrary. The full text of this document is
available on eLibrary in PDF and Microsoft Word format for viewing,
printing, and/or downloading. To access this document in eLibrary, type
the docket number excluding the last three digits of this document in
the docket number field.
52. User assistance is available for eLibrary and the Commission's
Web site during normal business hours from the Commission's Online
Support at (202) 502-6652 (toll free at 1-866-208-3676) or email at
ferconlinesupport@ferc.gov, or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at
public.referenceroom@ferc.gov.
List of Subjects
18 CFR Part 2
Administrative practice and procedure, and Reporting and
recordkeeping requirements.
18 CFR Part 380
Environmental impact statements, and Reporting and recordkeeping
requirements.
By direction of the Commission.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
In consideration of the foregoing, the Commission proposes to amend
Parts 2 and 380, Chapter I, Title 18, Code of Federal Regulations, as
follows:
PART 2--GENERAL POLICY AND INTERPRETATIONS
0
1. The authority citation for Part 2 continues to read as follows:
Authority: 5 U.S.C. 601; 15 U.S.C. 717-717z, 3301-3432; 16
U.S.C. 792-828c, 2601-2645, 42 U.S.C. 4321-4370h, 7101-7352.
0
2. Amend Sec. 2.55 by adding a sentence after the last sentence in
paragraph (a)(1), revising paragraph (b)(1)(ii), and adding paragraph
(c) to read as follows:
Sec. 2.55 Definition of terms used in section 7(c).
* * * * *
(a) * * *
(1) * * * The auxiliary installations must be located within the
existing, certificated permanent right-of-way or authorized facility
site and must be constructed using the temporary work space used to
construct the existing facility (See appendix A to this part 2 for
guidelines on what is considered to be the appropriate work area in
this context).
* * * * *
(b) * * *
(1) * * *
(ii) The replacement facilities will have a substantially
equivalent designed delivery capacity, will be located in the same
right-of-way or on the same site as the facilities being replaced, and
will be constructed using the temporary work space used to construct
the existing facility (See appendix A to this part 2 for guidelines on
what is considered to be the appropriate work area in this context);
* * * * *
(c) Landowner notification. (1) No activity described in paragraphs
(a) and (b) of this section is authorized unless the company makes a
good faith effort to notify in writing all affected landowners, as
defined in paragraph (c)(2) of this section, at least 10 days prior to
commencing any activity under this section. A landowner may waive the
10-day prior notice requirement in writing as long as the notice has
been provided. The notification shall include at least:
(i) A brief description of the facilities to be constructed or
replaced and the effect the activity will have on the landowner's
property;
(ii) The name and phone number of a company representative who is
knowledgeable about the project; and
(iii) A description of the Commission's Dispute Resolution Service
Helpline as explained in Sec. 1b.21(g) of this chapter and the Dispute
Resolution Service Helpline number.
(2) All affected landowners includes owners of property interests,
as noted in the most recent county/city tax records as receiving the
tax notice, whose property:
(i) Is directly affected (i.e., crossed or used) by the proposed
activity, including all rights-of-way, facility sites (including
compressor stations, well sites, and all above-ground facilities),
access roads, pipe and contractor yards, and temporary workspace; or
(ii) Abuts either side of an existing right-of-way or facility
site, or abuts the edge of a proposed right-of-way or facility site
which runs along a property line in the area that would be affected, or
contains a residence within 50 feet of the proposed construction work
area.
* * * * *
PART 380--REGULATIONS IMPLEMENTING THE NATIONAL ENVIRONMENTAL
POLICY ACT
0
3. The authority citation for Part 380 continues to read as follows:
Authority: 42 U.S.C. 4321-4370h, 7101-7352; E.O. 12009, 3 CFR
1978 Comp., p. 142.
0
4. In Sec. 380.15, redesignate paragraphs (c), (d), (e), and (f) as
paragraphs (d), (e), (f), and (g) and add new paragraph (c) to read as
follows:
Sec. 380.15 Siting and maintenance requirements.
* * * * *
[[Page 687]]
(c) Landowner notification. (1) No siting, construction, or
maintenance activity within the right-of-way is authorized unless the
company makes a good faith effort to notify in writing all affected
landowners, as defined in paragraph (c)(2) of this section, at least 10
days prior to commencing any such activity. A landowner may waive the
10-day prior notice requirement in writing as long as the notice has
been provided. The notification shall include at least:
(i) A brief description of the activity and the effect the activity
will have on the landowner's property;
(ii) The name and phone number of a company representative who is
knowledgeable about the project; and
(iii) A description of the Commission's Dispute Resolution Service
Helpline as explained in Sec. 1b.21(g) of this chapter and the Dispute
Resolution Service Helpline number.
(2) All affected landowners includes owners of property interests,
as noted in the most recent county/city tax records as receiving the
tax notice, whose property:
(i) Is directly affected (i.e., crossed or used) by the proposed
activity, including all facility sites (including compressor stations,
well sites, and all above-ground facilities), rights-of-way, access
roads, pipe and contractor yards, and temporary workspace; or
(ii) Abuts either side of an existing right-of-way or facility
site, or abuts the edge of a proposed right-of-way or facility site
which runs along a property line in the area that would be affected, or
contains a residence within 50 feet of the proposed work area.
* * * * *
[FR Doc. 2012-31085 Filed 1-3-13; 8:45 am]
BILLING CODE 6717-01-P