[Federal Register Volume 78, Number 143 (Thursday, July 25, 2013)]
[Proposed Rules]
[Pages 44900-44909]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-17682]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Parts 38 and 284

[Docket No. RM13-17-000]


Communication of Operational Information Between Natural Gas 
Pipelines and Electric Transmission Operators

AGENCY: Federal Energy Regulatory Commission.

ACTION: Notice of proposed rulemaking.

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

SUMMARY: The Federal Energy Regulatory Commission (Commission) is 
proposing to revise Parts 38 and 284 of the Commission's regulations to 
provide explicit authority to interstate natural gas pipelines and 
public utilities that own, operate, or control facilities used for the 
transmission of electric energy in interstate commerce to share non-
public, operational information with

[[Page 44901]]

each other for the purpose of promoting reliable service or operational 
planning on either the public utility's or pipeline's system.

DATES: Comments are due August 26, 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: 
Caroline Daly (Technical Information), Office of Energy Policy & 
Innovation, 888 First Street NE., Washington, DC 20426, (202) 502-8931, 
caroline.daly@ferc.gov.
Anna Fernandez (Legal Information), Office of the General Counsel, 888 
First Street NE., Washington, DC 20426, (202) 502-6682, 
anna.fernandez@ferc.gov.

SUPPLEMENTARY INFORMATION: 
    1. In this Notice of Proposed Rulemaking, the Commission is 
proposing to revise Parts 38 and 284 of the Commission's regulations to 
provide explicit authority to interstate natural gas pipelines and 
public utilities that own, operate, or control facilities used for the 
transmission of electric energy in interstate commerce to share non-
public, operational information with each other for the purpose of 
promoting reliable service or operational planning on either the public 
utility's or pipeline's system.\1\ This proposal will help ensure the 
reliability of pipeline and public utility transmission service by 
permitting transmission operators to share the information that they 
deem necessary to promote the reliability and integrity of their 
systems with each other. However, recipients of that non-public, 
operational information would be subject to a No-Conduit Rule that 
prohibits subsequent disclosure of that information to an affiliate or 
third party.
---------------------------------------------------------------------------

    \1\ For ease of reference, we will refer to these parties 
collectively as ``transmission operators.''
---------------------------------------------------------------------------

I. Background

    2. In recent years, reliance on natural gas as a fuel for electric 
generation has steadily increased.\2\ This trend is expected to 
continue into the future, resulting in greater interdependence between 
the natural gas and electric industries.\3\ Several events over the 
last few years, such as the Southwest Cold Weather Event,\4\ show the 
crucial interconnection between natural gas pipelines and electric 
transmission operators and the need for robust communication between 
these industry sectors to ensure that both systems operate safely and 
effectively for the benefit of their customers. While entities from 
both industries have already begun efforts to improve coordination, 
further sharing of non-public, operational information between 
transmission operators could enhance system reliability and contingency 
planning in both industries.
---------------------------------------------------------------------------

    \2\ See, e.g., Energy Information Administration, Fuel 
Competition in Power Generation and Elasticities of Substitution 
(June 2012); Richard Smead, All Industry Segments Working for 
Success in Growing Gas-Fired Generation (Nov. 15, 2012), available 
at http://www.navigant.com/insights/library/energy/2012/gas_fired_generation/; ISO-NE, Addressing Gas Dependence at 3 (July 2012) 
(reliance on natural gas-fired electricity in the region increased 
from five percent in 1990 to 51 percent in 2011), available at 
http://www.iso-ne.com/committees/comm_wkgrps/strategic_planning_discussion/materials/natural-gas-white-paper-draft-july-2012.pdf.
    \3\ See, e.g., North American Electric Reliability Corporation, 
2013 Special Reliability Assessment: Accommodating an Increased 
Dependence on Natural Gas for Electric Power; Phase II: A 
Vulnerability and Scenario Assessment for the North American Bulk 
Power System at 1 (May 2013) (``Over the past decade, natural gas-
fired generation rose significantly from 17 percent to 25 percent of 
U.S. power generation and is now the largest fuel source for 
generation capacity. Gas use is expected to continue to increase in 
the future, both in absolute terms and as a share of total power 
generation and capacity.''), available at http://www.nerc.com/pa/RAPA/ra/Reliability%20Assessments%20DL/NERC_PhaseII_FINAL.pdf; 
Energy Information Administration, Annual Energy Outlook 2013 Early 
Release Overview (2013) (showing electric generation from natural 
gas rising from 13 percent in 1993 to 30 percent in 2040), available 
at http://www.eia.gov/forecasts/aeo/er/early_elecgen.cfm; The New 
England State Committee on Electricity, Natural Gas Infrastructure 
and Electric Generation: A Review of Issues Facing New England (Dec. 
14, 2012), available at http://www.nescoe.com/uploads/Phase_I_Report_12-17-2012_Final.pdf.
    \4\ See FERC/NERC, Report on Outages and Curtailments During the 
Southwest Cold Weather Event of February 1-5, 2011 (2011), available 
at http://www.ferc.gov/legal/staff-reports/08-16-11-report.pdf.
---------------------------------------------------------------------------

    3. On February 15, 2012, the Commission issued a notice in Docket 
No. AD12-12-000 requesting comments on various aspects of gas-electric 
interdependence and coordination in response to questions posed by 
members of the Commission.\5\ In order to better understand the 
interface between the electric and natural gas pipeline industries and 
identify areas for improved coordination, the questions covered a 
variety of topics including market structure and rules, scheduling, 
communications, infrastructure and reliability. In response to the 
notice, the Commission received comments from 79 entities, with some 
raising concerns that current laws, regulations, or tariffs may hinder 
the sharing of such information.
---------------------------------------------------------------------------

    \5\ Coordination Between Natural Gas and Electricity Markets, 
Docket No. AD12-12-000 (Feb. 15, 2012) (Notice Assigning Docket No. 
and Requesting Comments) (available at http://elibrary.ferc.gov/idmws/common/opennat.asp?fileID=12893828). See also Commissioner 
Philip D. Moeller, Request for Comments of Commissioner Moeller on 
Coordination between the Natural Gas and Electricity Markets (Feb. 
3, 2012), available at http://www.ferc.gov/about/com-mem/moeller/moellergaselectricletter.pdf; Commissioner Cheryl A. LaFleur, 
Statement regarding Standards for Business Practices for Interstate 
Natural Gas Pipelines (Feb. 16, 2012), available at http://www.ferc.gov/media/statements-speeches/lafleur/2012/02-16-12-lafleur-G-1.asp.
---------------------------------------------------------------------------

    4. During August 2012, the Commission convened five regional 
conferences for the purpose of exploring these issues and obtaining 
further information from the electric and natural gas industries 
regarding coordination between the industries. Representatives from a 
cross-section of both industries attended the regional conferences, 
with total attendance exceeding 1,200 registrants. Among the topics 
discussed at the conferences were communications, coordination, and 
information-sharing. Participants at multiple conferences again 
expressed concern that Commission rules and policies could be impeding 
further efforts to improve communication between the industries.\6\ 
Some natural gas pipelines and Regional Transmission Organizations and 
Independent System Operators (RTOs/ISOs) also noted that, although they 
make significant amounts of operational information publicly available, 
there is reluctance to share information on a more granular level 
because of concerns about violating statutory prohibitions against 
undue preference for any customer or customer class.\7\
---------------------------------------------------------------------------

    \6\ See FERC Staff Report on Gas-Electric Coordination Technical 
Conferences (Nov. 2012), available at http://www.ferc.gov/legal/staff-reports/11-15-12-coordination.pdf (November 15 Staff Report).
    \7\ November 15 Staff Report at 24.
---------------------------------------------------------------------------

    5. On November 15, 2012, the Commission issued an order directing 
further technical conferences and

[[Page 44902]]

reports.\8\ In the November 15 Order, the Commission acknowledged the 
concerns regarding communications between the two industries, but found 
that there was little specific discussion of potential clarifications 
or potential changes to the Commission's regulations.\9\ The 
Commission, therefore, directed Commission staff to convene a technical 
conference to identify areas in which additional Commission guidance or 
potential regulatory changes could be considered.\10\
---------------------------------------------------------------------------

    \8\ Coordination Between Natural Gas and Electricity Markets, 
141 FERC ] 61,125 (2012) (November 15 Order).
    \9\ Id. P 5.
    \10\ Id.
---------------------------------------------------------------------------

    6. Pursuant to the November 15 Order, on December 7, 2012, a Notice 
of Request for Comments and Technical Conference to be held on February 
13, 2013 was issued on information sharing and communication issues 
between the natural gas and electricity industries.\11\ Interested 
parties were asked to file comments prior to the technical conference 
on three questions related to communications and information sharing. 
Twenty-seven comments were filed in response to the Notice of Request 
for Comments and Technical Conference,\12\ and more than 350 persons, 
representing a cross-section of industry, registered for the technical 
conference.
---------------------------------------------------------------------------

    \11\ Coordination between Natural Gas and Electricity Markets, 
Docket No. AD12-12-000 (Dec. 7, 2012) (Notice Of Request for 
Comments and Technical Conference) (http://www.ferc.gov/EventCalendar/Files/20121207134434-AD12-12-000TC1.pdf); 77 Fed. Reg. 
74180 (Dec. 13, 2012) (http://www.gpo.gov/fdsys/pkg/FR-2012-12-13/pdf/2012-30063.pdf).
    \12\ A list of commenters with the abbreviations used to 
identify them is attached as an Appendix.
---------------------------------------------------------------------------

    7. In response to the Notice of Request for Comments and Technical 
Conference, and at the February 13 technical conference itself, natural 
gas and electric industry participants described a variety of actions 
that are currently being taken to improve communications and 
information sharing between the two industries. However, several 
entities acknowledged that system reliability and contingency planning 
could be further enhanced by the sharing of non-public, operational 
information directly between transmission operators.\13\ Several 
transmission operators pointed out that there is general reluctance to 
share such information because of concerns that doing so could be a 
violation of current laws, regulations or tariffs.\14\ For example, 
INGAA stated that there is some risk that a pipeline could be subject 
to an allegation of undue discrimination in violation of section 4 of 
the Natural Gas Act (NGA) if it provides an electric transmission 
operator with non-public transmission information with respect to any 
transportation or sale of natural gas without contemporaneously 
disclosing that information to all other shippers or potential 
shippers.\15\ MidAmerican and AGA also expressed concerns that the 
Standards of Conduct \16\ or the Commission's prohibition on ``undue 
discrimination'' may present a real or perceived barrier to effective 
participation in certain table-top reliability exercises or emergency 
or system planning exercises among regional stakeholders.\17\ 
Accordingly, INGAA and several others requested that, in order to 
facilitate the exchange of information between transmission operators, 
the Commission should more clearly identify the types of operational 
information that may be shared between transmission operators and 
clarify that the sharing of such information does not violate the 
prohibition against undue discrimination.\18\
---------------------------------------------------------------------------

    \13\ See, e.g., MISO Comments, Docket No. AD12-12-000, at 3 
(filed Jan. 7, 2013), 6; ISO-NE Comments, Docket No. AD12-12-000, at 
4 (filed Jan. 7, 2013); SPP Comments, Docket No. AD12-12-000, at 5 
(filed Jan. 7, 2013); PJM Comments, Docket No. AD12-12-000, at 3 
(filed Jan. 11, 2013); MidAmerican Comments, Docket No. AD12-12-000, 
at 9-10 (filed Jan. 7, 2013); BPA Comments, Docket No. AD12-12-000, 
at 6 (filed Jan. 7, 2013); NYTOs Comments, Docket No. AD12-12-000, 
at 4 (filed Jan. 7, 2013); AGA Comments, Docket No. AD12-12-000, at 
4 (filed Jan. 7, 2013); National Grid Comments, Docket No. AD12-12-
000, at 8 (filed Jan. 7, 2013).
    \14\ See, e.g., Spectra Comments, Docket No. AD12-12-000, at 3-5 
(filed Jan. 7, 2013); MISO Comments, Docket No. AD12-12-000, at 5 
(filed Jan. 7, 2013); INGAA Comments, Docket No. AD12-12-000, at 9-
11 (filed Jan. 7, 2013); ISO-NE Comments, Docket No. AD12-12-000, at 
4 (filed Jan. 7, 2013); PJM Comments, Docket No. AD12-12-000, at 4 
(filed Jan. 11, 2013).
    \15\ INGAA Comments, AD12-12-000, at 11 (filed Jan. 7, 2013).
    \16\ 18 CFR Part 358 (2012).
    \17\ MidAmerican Comments, Docket No. AD12-12-000, at 8 (filed 
Jan. 7, 2013); AGA Comments, Docket No. AD12-12-000, at 8 (filed 
Jan. 7, 2013).
    \18\ INGAA Comments, Docket No. AD12-12-000, at 11 (filed Jan. 
7, 2013). See also NYTOs, Docket No. AD12-12-000, at 4, 9 (filed 
Jan. 7, 2013); MidAmerican Comments, Docket No. AD12-12-000, at 10 
(filed Jan. 7, 2013); AGA Comments, Docket No. AD12-12-000, at 4 
(filed Jan. 7, 2013); Spectra Comments, Docket No. AD12-12-000, at 5 
(filed Jan. 7, 2013).
---------------------------------------------------------------------------

    8. While electric generators generally did not oppose the sharing 
of such information, they, together with other entities, expressed 
concern about the communication of generator-specific information 
between an electric transmission operator and a pipeline operator 
without the generator's knowledge. For example, We Energies asserted 
that excluding the generator operator from discussions between RTOs/
ISOs and natural gas pipelines regarding the status of a generator's 
fuel supplies will increase the risk that generator capability will be 
misrepresented.\19\ We Energies also stated that a generating unit's-
specific market sensitive information, such as run times and dispatch 
levels provided to a pipeline by the RTO prior to the generator having 
arranged for any needed incremental gas transportation requirements, 
could provide the pipeline with a competitive advantage over the 
generator in pricing its transportation services to that generator.\20\ 
National Grid stated that commercially sensitive information from 
individual generators should not be shared with natural gas pipeline 
representatives or affiliates that sell or buy wholesale electric power 
or market natural gas.\21\
---------------------------------------------------------------------------

    \19\ We Energies Comments, Docket No. AD12-12-000, at 3 (filed 
Jan. 7, 2013).
    \20\ We Energies Comments, Docket No. AD12-12-000, at 5 (filed 
Jan. 7, 2013).
    \21\ National Grid Comments, Docket No. AD12-12-000, at 8-9 
(filed Jan. 7, 2013).
---------------------------------------------------------------------------

    9. Some commenters expressed concern regarding the potential harm 
to industry participants or the potential for improper use of material 
resulting from increased communications.\22\ For example, MidAmerican 
stated that customer specific information is commercially sensitive and 
must be subject to strict limitations, including appropriate protocols 
ensuring that generator unit-specific gas usage and transportation 
information is not publicly posted or disclosed to non-directly 
connected pipelines. AF&PA stated that generally information that is 
potentially commercially sensitive should only be disseminated when 
there is an articulable and rational reason to expect such exchanges 
would further improve reliability or efficiency on either or both 
systems.\23\ In addition, APGA argued that transportation information 
provides the potential for gaming, market manipulation, and other 
violations of the NGA and Federal Power Act (FPA). EPSA asserted that, 
when system operators share information with natural gas pipelines, 
pipelines should have appropriate limitations on who has access to this 
information. EPSA stated that specific

[[Page 44903]]

guidelines are needed when the same person at a pipeline who sells and 
schedules capacity could have access to shared information.\24\ NYTOs 
noted that, since generators and fuel managers in New York are merchant 
entities, there is potential for misuse of confidential information 
(for example, whether a generator is critical to maintain reliability) 
to the extent it is shared as part of these communications.\25\ NYTOs 
stated that they would not support disclosure of market-sensitive 
information unless strong measures were in place to prevent and punish 
market abuses.


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

    \22\ See, e.g., MidAmerican Comments, Docket No. AD12-12-000, at 
10 (filed Jan. 7, 2013); APGA Comments, Docket No. AD12-12-000, at 5 
(filed Jan. 7, 2013); AEP Comments, Docket No. AD12-12-000, at 7 
(filed Jan. 7, 2013); AF&PA Comments, Docket No. AD12-12-000, at 2 
(filed Jan. 7, 2013); EPSA Comments, Docket No. AD12-12-000, at 7 
(filed Jan. 7, 2013).
    \23\ AF&PA Comments, Docket No. AD12-12-000, at 5 (filed Jan. 7, 
2013).
    \24\ EPSA Comments, Docket No. AD12-12-000, at 7 (filed Jan. 7, 
2013).
    \25\ NYTOs Comments, Docket No. AD12-12-000, at 7 (filed Jan. 7, 
2013).
---------------------------------------------------------------------------

II. Discussion

    10. Communications occur today in the normal course of business 
between transmission operators and those communications serve a 
valuable and necessary purpose to help ensure reliability. In an effort 
to provide certainty to the industry and remove barriers--real or 
perceived--to the sharing of non-public, operational information, the 
Commission proposes to revise its regulations to authorize expressly 
the exchange of non-public, operational information between electric 
transmission operators and interstate natural gas pipelines. The 
Commission intends to remove any barriers to the sharing of non-public, 
operational information, not just during emergencies, but also for day-
to-day operations, planned outages, and scheduled maintenance. However, 
in consideration of the concerns regarding the exchange of non-public 
operational information, the Commission also proposes to adopt a No-
Conduit Rule which prohibits recipients of the non-public, operational 
information from subsequently disclosing or being a conduit for 
subsequently disclosing that information to any other entity.\26\ 
Moreover, to the extent that an electric transmission operator or 
pipeline has a tariff provision which precludes a communication that 
would otherwise be authorized under the proposed regulations, it would 
have to make a filing under the FPA or NGA to revise that provision to 
permit such exchanges of information.
---------------------------------------------------------------------------

    \26\ Conduct and Affiliate Restrictions. See 18 CFR 358.6 and 18 
CFR 35.39(g). Moreover, the Commission determined in Order No. 717 
that the No-Conduit Rule was a critical component of the regulatory 
scheme of the Standards of Conduct. See Standards of Conduct for 
Transmission Providers, Order No. 717, 73 FR 63796 (Oct. 27, 2008), 
FERC Stats. & Regs. ] 31,280, at P 198 (2008).
---------------------------------------------------------------------------

    11. The Commission has structured the proposed regulations to 
provide significant flexibility to individual transmission operators--
who have the most insight and knowledge of their systems--to determine 
what non-public operational information, if any, would promote reliable 
service on their systems, without fear of violating the Commission's 
prohibitions on undue discrimination and undue preference or such an 
exchange being considered an unjust or unreasonable practice. Notably, 
the Commission is proposing a permissive approach to the sharing of 
non-public information. To the extent this voluntary approach proves 
inadequate to promote reliable service or operational planning on 
natural gas pipelines and electric transmission systems, the Commission 
may revisit the need to require certain communications or information 
sharing between transmission operators in the future.

A. Undue Discrimination or Preference

    12. To provide context for the proposed regulations discussed 
below, the Commission first reviews the existing statutory and 
regulatory requirements applicable to communications between the gas 
and electric industries. Both the FPA and the comparable provisions of 
the NGA prohibit undue discrimination or preference.\27\ Specifically, 
section 205(b) of the FPA provides that no public utility:
---------------------------------------------------------------------------

    \27\ 16 U.S.C. 824d(b) (2006); 15 U.S.C. 717c(b) (2006).

    shall, with respect to any transmission or sale subject to the 
jurisdiction of the Commission, (1) make or grant any undue 
preference or advantage to any person or subject any person to any 
undue prejudice or disadvantage, or (2) maintain any unreasonable 
difference in rates, charges, service, facilities, or in any other 
respect, either as between localities or as between classes of 
service.\28\
---------------------------------------------------------------------------

    \28\ The language of the NGA is virtually identical. 15 U.S.C. 
717c(b) (2006).

    13. FPA section 205(b) and NGA section 4(b) do not forbid 
preferences, advantages and prejudices per se.\29\ Rather, FPA section 
205(b) and NGA section 4(b) prohibit ``undue'' preferences, advantages 
and prejudices.\30\ A difference in treatment is not unduly 
discriminatory when the difference is justified.\31\ In interpreting 
FPA section 205(b) and NGA section 4(b), the courts have held that 
transmission providers cannot treat similarly situated customers 
differently \32\ and that the disparate treatment of two customer 
classes does not in and of itself result in an undue preference or 
advantage or in an unreasonable difference in service if the customer 
classes are not similarly situated.\33\ Whether a preference is 
``undue'' depends on the specific facts of the behavior and the 
circumstances to determine whether disparities exist and whether those 
disparities are rationally justified.\34\ The Commission's Standards of 
Conduct seek to deter undue discrimination by prohibiting the exchanges 
of information between transmission providers and their marketing 
functions in certain situations.\35\ The comments in the proceeding in 
Docket No. AD12-12-000 focus on the applicability of both the statutory 
prohibitions on undue discrimination and the Standards of Conduct.
---------------------------------------------------------------------------

    \29\ See, e.g., Cities of Bethany v FERC, 727 F.2d 1131, 1139 ( 
Cir.), cert. denied, 469 U.S. 917, 105 S.Ct. 293, 83 L.Ed.2d 229 
(1984).
    \30\ See, e.g., Boroughs of Chambersburg v. FERC, 580 F.2d 573, 
577 (D.C. Cir. 1978).
    \31\ See Metropolitan Edison Co. v. FERC, 595 F.2d 851, 857 
(D.C. Cir. 1979). See also Transmission Agency of N. California v. 
FERC, 628 F.3d 538, 549 (D.C. Cir. 2010) (citing Ark. Elec. Energy 
Consumers v. FERC, 290 F.3d 362, 367 (D.C. Cir. 2002) and Elec. 
Consumers Res. Council v. FERC, 747 F.2d 1511, 1515 (D.C. Cir. 
1984)).
    \32\ See Transmission Agency of N. California v. FERC, 628 F.3d 
at 549 (citing Sacramento Mun. Util. Dist. v. FERC, 474 F.3d 797, 
802 (D.C. Cir. 2007)).
    \33\ See, e.g., Sw. Elec. Coop., Inc. v. FERC, 347 F.3d 975, 981 
(D.C. Cir. 2003). See also Michigan Consolidated Gas Co. v. FPC, 203 
F.2d 895, 901 (3d Cir. 1953) and Complex Consol. Edison Co. of New 
York, Inc. v. FERC, 165 F.3d 992, 1012 (D.C. Cir. 1999).
    \34\ See St. Michaels Utilities Comm'n v. Fed. Power Comm'n, 377 
F.2d 912, 915 (4th Cir. 1967).
    \35\ Order No. 717, FERC Stats. & Regs. ] 31,280 at P 3.
---------------------------------------------------------------------------

    14. The first issue is whether the statutory restrictions in the 
FPA and NGA regarding undue discrimination or unjust and unreasonable 
acts and practices prevent the exchange of information between 
operators of pipeline transportation systems and electric transmission 
operators. The Commission believes that the sharing of non-public, 
operational information between public utilities and natural gas 
pipelines for the purpose of promoting reliable service or operational 
planning is reasonable and not unduly discriminatory or preferential. 
The undue discrimination provisions apply to ensure that similarly 
situated customers are not subject to disparate rates or terms and 
conditions of service. As discussed below, transmission operators are 
not similarly situated to other customers because they require

[[Page 44904]]

access to non-public scheduling and other types of information from a 
variety of sources to help them ensure the reliability and integrity of 
the transportation and transmission systems. In addition, natural gas 
pipelines are generally not customers of electric transmission 
operators. Likewise, in the case of RTOs/ISOs, they are not shippers on 
pipelines. We recognize that some vertically integrated transmission 
owners may have marketing function employees or affiliates, such as 
generators or local distribution companies who handle gas transactions. 
However, putting in place the proposed No-Conduit rule will serve as a 
safeguard to ensure that the transmission owners comply with the 
prohibitions against undue discrimination or preference with respect to 
their marketing function or affiliated entities.\36\
---------------------------------------------------------------------------

    \36\ The Standards of Conduct at 18 CFR 358.6 and 358.7 govern 
the preferential sharing of transmission function information from a 
transmission provider to its marketing function employees as defined 
in 18 CFR 358.3(c).
---------------------------------------------------------------------------

    15. In order to operate natural gas pipelines and electric 
transmission systems effectively, transmission operators historically 
and necessarily have shared non-public information with other parties 
operating transportation or transmission facilities. For example, 
pipeline operators routinely exchange nomination and scheduling 
information with other pipeline operators and with upstream and 
downstream entities (that may be shippers on the pipeline) to confirm 
transportation nomination requests and to coordinate flows between the 
parties.\37\ Transmitting electric utilities similarly coordinate the 
sharing of non-public interchange schedule information on a routine 
basis through mechanisms such as, for example, e-Tags.\38\ This 
coordination helps ensure the safe and reliable transmission of 
electric power across a region.
---------------------------------------------------------------------------

    \37\ The nomination process initiates the flow of gas with the 
natural gas transportation service provider. The natural gas 
transportation service provider then confirms the flow of natural 
gas with the corresponding upstream and downstream entities. Once 
the natural gas quantities are confirmed, the natural gas 
transportation service provider sends the scheduled quantities 
information to the shipper.
    \38\ e-Tags are used by applicable Balancing Authorities, 
Reliability Coordinators, Interchange Authorities, Transmission 
Service Providers, Purchasing-Selling Entities, Generator-Providing 
Entities, and Load-Serving Entities to coordinate interchange 
schedules. See, e.g., NAESB Wholesale Electric Quadrant (WEQ) 
Business Practice Standards (Coordinate Interchange) requirement 
004-2 (``Until other means are adopted by NAESB, the primary method 
of submitting the RFI [Request for Interchange] shall be an e-Tag 
communicated to and managed by the Sink BA's [Balancing Authority] 
registered e-Tag authority service using protocols compliant with 
the Version 1.8.1 Electronic Tagging Functional Specification.'') 
and applicability section (``The Coordinate Interchange Business 
Practice Standards apply to BA [Balancing Authority], RC 
[Reliability Coordinator], IA [Interchange Authority], Transmission 
Service Provider, PSE [Purchasing-Selling Entity], GPE [Generator-
Providing Entity], Load-Serving Entity [LSE], and any TPSE [a PSE 
whose transmission approval rights are cited].'') NAESB WEQ Business 
Practice Standards (Version 003), published July 31, 2012.
---------------------------------------------------------------------------

    16. Likewise, in Order No. 698, the Commission authorized the 
exchange of operational information between the industries.\39\ There, 
the Commission incorporated North American Energy Standards Board 
(NAESB) Wholesale Gas Quadrant (WGQ) Standard 0.3.12 into its 
regulations. This standard requires a generator and its directly 
connected natural gas pipeline(s) to ``establish procedures to 
communicate material changes in circumstances that may impact hourly 
flow rates.'' \40\ In addition, this standard ensures that natural gas 
pipelines have relevant planning information to assist in maintaining 
the operational integrity and reliability of pipeline service, as well 
as to provide gas-fired power plant operators with information as to 
whether hourly flow deviations can be honored. NAESB Wholesale Electric 
Quadrant (WEQ) Standard 011-1.6, also incorporated in the Commission's 
regulations,\41\ requires that ISOs, RTOs, and other independent system 
operators establish written operational communication procedures with 
the appropriate pipeline to be implemented when an extreme condition 
occurs.
---------------------------------------------------------------------------

    \39\ Standards for Business Practices for Interstate Natural Gas 
Pipelines; Standards for Business Practices for Public Utilities, 
Order No. 698, FERC Stats. & Regs. ] 31,251 (2007),order on 
clarification and reh'g, Order No. 698-A, 121 FERC ] 61,264 (2007). 
In Order No. 698, the Commission incorporated by reference standards 
adopted by NAESB.
    \40\ NAESB WGQ Version 2.0 Business Practice Standard 0.3.12. 
See also Standards for Business Practices for Interstate Natural Gas 
Pipelines, Order No. 587-V, FERC Stats. & Regs. ] 31,332 (cross-
referenced at 140 FERC ] 61,036) (2012), (incorporating by reference 
the Version 2.0 WGQ Business Practice Standards) (to be codified at 
18 CFR 284.12).
    \41\ 18 CFR Part 38 (2012).
---------------------------------------------------------------------------

    17. Sharing of operational information between natural gas 
pipelines and electric transmission operators is akin to the sharing of 
operational information among interconnected parties. Both the natural 
gas pipelines and the electric transmission operators need to know 
whether scheduled transactions on their respective systems will be 
honored by the other. This sharing of information is crucial to the 
effective operations of both systems and is not the type of private 
sharing of information with select customers at which the undue 
discrimination provisions of the respective statutes were targeted.
    18. There are already several safeguards in place to protect 
against undue discrimination. For example, while non-public operational 
information may be useful for planning, transmission operators cannot 
deviate from the terms of their tariffs, and cannot operate in an 
unduly discriminatory manner.\42\ Interstate natural gas pipelines and 
electric transmission operators are also subject to the same 
limitations on sharing information with their marketing function 
employees as provided under the Standards of Conduct.\43\ Moreover, we 
are proposing additional safeguards as discussed below.
---------------------------------------------------------------------------

    \42\ See ISO New England Inc., 142 FERC ] 61,058, at P 23 (2013) 
(available capacity must be dispatched ``consistent with the 
pipeline's tariff'' and ``[t]he pipelines are required to allocate 
available capacity on a not unduly discriminatory basis among the 
various requestors of capacity'').
    \43\ 18 CFR 358.6 and 358.7.
---------------------------------------------------------------------------

    19. Based on the critical need for such exchanges of information to 
promote the reliability and the operational integrity of industries the 
Commission regulates, and the protections against undue discrimination, 
we find that the exchange of non-public, operational information 
between transmission operators does not violate the statutory 
prohibitions on undue discrimination or preference as discussed herein.

B. Clarification Regarding Table-Top Exercises

    20. Several comments requested clarification of the applicability 
of the Standards of Conduct and statutory prohibition against undue 
discrimination to exchanges of information with regard to table-top 
exercises involving marketing affiliates of transmission providers and 
inter-industry participants. The Standards of Conduct govern, among 
other things, communications between interstate natural gas pipelines 
and their employees and affiliates that engage in marketing functions, 
and public utilities that own or operate electric transmission 
facilities and their employees and affiliates that engage in marketing 
functions.\44\ As the Commission has previously stated, the Standards 
of Conduct apply to communications only within the same organization 
(in other words, between the affiliated entities of a single corporate 
family) and therefore, do not limit communications between

[[Page 44905]]

unaffiliated pipelines and electric transmission providers.\45\
---------------------------------------------------------------------------

    \44\ 18 CFR 358.1(a) and (b) (2012).
    \45\ November 15 Order, 141 FERC ] 61,125 at P 6. See also 18 
CFR 358.1.
---------------------------------------------------------------------------

    21. Under the Standards of Conduct, marketing function employees 
may participate in table-top exercises that include a wide range of 
industry participants who will have equal access to non-public 
transmission information. However, as the Commission has explained, 
non-public transmission information cannot be provided during private 
table-top exercises involving only the transmission provider and 
marketing function employees since they would receive preferential 
access to non-public transmission information or preferential access to 
transmission facilities.\46\
---------------------------------------------------------------------------

    \46\ See Ameren Services Co., et al., 86 FERC ] 61,079, at 
61,290 (1999). See also South Carolina Electric and Gas Co., 111 
FERC ] 61,217 (2005).
---------------------------------------------------------------------------

C. Revisions to Regulations

    22. Consistent with the foregoing discussion of existing statutes 
and regulations, to provide additional certainty to transmission 
operators regarding the permissibility of sharing of non-public, 
operational information, the Commission is proposing to revise its 
regulations to authorize expressly the exchange of non-public, 
operational information between electric transmission operators and 
interstate natural gas pipelines.\47\ Proposed section 38.3 applies to 
any public utility that owns, operates, or controls facilities used for 
the transmission of electric energy in interstate commerce subject to a 
No-Conduit Rule. Similar changes are proposed in section 284.12(b), 
which applies to any interstate pipeline.\48\
---------------------------------------------------------------------------

    \47\ The proposed regulations also recognize the existing 
exchanges of information among pipelines and among electric 
transmission operators that promote reliable service or operational 
planning.
    \48\ While the Commission also regulates interstate service 
provided by intrastate pipelines, Hinshaw pipelines, and local 
distribution companies, the companies themselves are subject to 
state regulation and may exchange information subject to whatever 
state regulations govern their operations.
---------------------------------------------------------------------------

1. Permissible Disclosure of Non-Public, Operational Information
    23. Proposed sections 38.3(a) and 284.12(b)(4) authorize public 
utilities providing transmission service and natural gas pipelines to 
share non-public, operational information when such information is for 
the purpose of promoting reliable service or operational planning. The 
term ``non-public, operational information'' is information that is not 
publicly posted, yet helps transmission operators to operate and 
maintain either a reliable pipeline system or a reliable electric 
transmission system on a day-to-day basis, as well as during emergency 
conditions or for operational planning. Non-public, operational 
information may also include generator, pipeline, or transmission-
specific information. In using the term ``non-public, operational 
information,'' the Commission intends that transmission operators would 
be permitted to share information dealing with actual, anticipated, or 
potential effects on the ability to provide electric and gas service 
based on the respective operator's experience and understanding of the 
operational capability and customer demands on their respective 
systems. Examples of such information include, but are not limited to, 
the following types of information:
     Real-time and anticipated system conditions that have or 
are anticipated to impact natural gas transportation by changing near 
term gas flows;
     actual and anticipated electric service interruptions to 
gas compressor locations;
     verification that there is sufficient pipeline operational 
capability available at a specific delivery point to change the 
quantity of natural gas delivered to the generator as identified by the 
electric transmission operator;
     actual and projected gas transportation restrictions to 
electric generators;
     real-time actual flow and point operational capacity data 
at all receipt and delivery points; real-time pipeline pressure at all 
receipt and delivery points;
     nominated and scheduled quantities of shippers who are or 
who supply gas-fired generators; and,
     scheduled dates and duration of generator, pipeline, and 
transmission maintenance and planned outages.
    24. The Commission is not proposing a specific list of non-public, 
operational information that can be shared in order to provide 
flexibility to individual operators--who have the most insight and 
knowledge of their systems--to determine what operational information, 
if any, would promote reliable service or operational planning on their 
systems. The Commission seeks comment on the scope of the non-public, 
operational information transmission operators may share under the 
proposed regulations, including the specific categories of information 
identified above.
    25. The Commission recognizes that the provisions of this proposal 
apply only to communications between pipelines and electric 
transmission operators and that natural gas-fired generators may have 
relevant information regarding their capabilities to acquire natural 
gas not available to a pipeline. Therefore, the Commission seeks 
comment on whether additional regulations are needed to require a 
generator to share necessary information with its electric transmission 
operator to inform it of the possibility that the generator's natural 
gas service may be disrupted. For example, the Commission seeks comment 
on whether a generator should be required, at the request of the 
electric transmission operator, to provide its electric transmission 
operator with information pertaining to any communications received 
from a natural gas pipeline regarding potential failures by the 
generator to conform to flow rates or nominations. In addition, the 
Commission seeks comment on whether the proposed rule should require 
that, to the extent the non-public, operational information exchanged 
between transmission operators involves customer-specific information 
(such as information about individual generators), the transmission 
operators must seek to include the customer as part of a three-way 
communication.\49\ If so, the Commission seeks comment on how such a 
requirement could be implemented.
---------------------------------------------------------------------------

    \49\ The Commission notes that communications between 
transmission operators and generators are not covered by this 
proposed rule; transmission operators may always discuss generator-
specific information with the relevant generator.
---------------------------------------------------------------------------

2. Limitations on Disclosure
    26. The Commission is proposing several protections, in addition to 
the existing protections described above, to ensure that any non-
public, operational information shared under these proposed regulations 
remains confidential, and to ensure that information is shared among 
transmission owners in a manner that is consistent with the prohibition 
on undue discrimination. Proposed sections 38.3(b) and 284.12(b)(4)(ii) 
adopt a No-Conduit Rule that prohibits all public utilities and natural 
gas pipelines, as well as their employees, contractors, consultants, or 
agents, from disclosing, or using anyone as a conduit for the 
disclosure of, non-public, operational information they receive under 
this proposed rule to a third party.\50\ Sections 38.3(b) and

[[Page 44906]]

284.12.(b)(4)(ii) similarly prohibits the disclosure of such non-
public, operational information to marketing function employees, as 
that term is defined in Sec.  358.3 of the Commission's 
regulations.\51\ Proposed sections 38.3(b) and 284.12(b)(4)(ii) do not 
prohibit communications between transmission operators covered by this 
rule. As discussed previously, together with the requirements that 
natural gas pipelines and transmission owners abide by their tariffs, 
these additional disclosure limitations should adequately protect 
against the harmful disclosure of non-public information and undue 
discrimination.\52\
---------------------------------------------------------------------------

    \50\ The Commission does not believe the existing No-Conduit 
Rule under the Standards of Conduct will sufficiently limit the 
disclosure of the information received under this proposed rule. The 
proposed No-Conduit Rule has a broader prohibition on disclosure, 
since it applies to all third parties, not just marketing function 
employees. Furthermore, the Standards of Conduct, and thus the No-
Conduit Rule under the Standards of Conduct, do not apply to RTOs/
ISOs. Therefore, the Commission is proposing a No-Conduit Rule in 
this part of the regulations that is tailored to the entities and 
information covered by the proposed rule, and extends the disclosure 
prohibition to non-affiliates.
    \51\ Since RTOs/ISOs do not have marketing function employees as 
defined in the Standards of Conduct, this provision would not apply 
to them.
    \52\ Unauthorized disclosure of any non-public, operational 
information may subject the entity or individual making the 
prohibited disclosure to the enforcement provisions of the FPA and 
NGA, including potential civil penalties. See section 22 of the NGA, 
15 U.S.C. 717t2-1 (2006), and section 316A of the FPA, 16 U.S.C. 
825o-1 (2006).
---------------------------------------------------------------------------

    27. We Energies and EPSA expressed concerns that generator-specific 
non-public information provided to a pipeline by an electric 
transmission operator prior to the generator having arranged for any 
needed incremental gas transportation requirements could provide the 
pipeline with a competitive advantage over the generator in pricing 
transportation services. We see no need to propose additional 
protections regarding pipeline transportation at this time. Interstate 
pipelines are required to allocate service, on a not unduly 
discriminatory basis, based on their tariffs, at a rate not exceeding 
the just and reasonable rate on file. Pipelines are not required to 
discount services, and if they choose to discount, are permitted to 
obtain information from any source to demonstrate that the shipper 
requesting the discount has competitive alternatives.\53\
---------------------------------------------------------------------------

    \53\ See Associated Gas Distributors v. FERC, 824 F.2d 981 (D.C. 
Cir. 1987) (permitting selective discounting only when justified by 
competitive alternatives and elastic demand conditions); Williston 
Basin Interstate Pipeline Co., 85 FERC ] 61,247 (1998). Consistent 
with that policy, in the next rate case after providing discounts, 
the Commission only permits pipelines to reduce their rate design 
volumes to reflect discounting upon a showing that the discounts 
they offered were required by competition. See, e.g., Panhandle 
Eastern Pipe Line Co., Opinion No. 395, 71 FERC ] 61,228, at 61,867 
(1995) (requiring documentation from its customers justifying their 
need for any discounts that they request); Panhandle Eastern Pipe 
Line Co., Opinion No. 404, 74 FERC ] 61,109, at 61,405 (1996).
---------------------------------------------------------------------------

III. Information Collection Statement

    28. The following collection of information contained in the 
Proposed Rule is subject to review by the Office of Management and 
Budget (OMB) under section 3507(d) of the Paperwork Reduction Act of 
1995 (PRA).\54\ OMB's regulations require that OMB approve certain 
reporting and recordkeeping requirements (collections of 
information).\55\ Upon approval of a collection of information, OMB 
will assign an OMB control number and expiration date. Respondents 
subject to the information collection requirements of this rule will 
not be penalized for failing to respond to this collection of 
information unless the collection of information displays a valid OMB 
control number.
---------------------------------------------------------------------------

    \54\ 44 U.S.C. 3507(d) (2006).
    \55\ 5 CFR 1320.11 (2012).
---------------------------------------------------------------------------

    29. The Commission will submit the information collection 
requirements to OMB for its review and approval under section 3507(d) 
of the PRA. The communications permitted under this proposed rule are 
not mandatory. The proposed rule would clarify that the requirements of 
the FPA and NGA do not prohibit certain voluntary communications 
between transmission providers.\56\ Comments are solicited on the need 
for this information, whether the information will have practical 
utility, the accuracy of the provided burden estimate, ways to enhance 
the quality, utility, and clarity of the information to be collected, 
and any suggested methods for minimizing the respondent's burden, 
including the use of automated information techniques.
---------------------------------------------------------------------------

    \56\ The OMB regulations, 5 CFR 1320.3, provide that 
``voluntary'' collections of information must be reported to OMB. 
The regulations do not define what is meant by voluntary, but it 
appears that the term was included to ensure review of agency's 
issuing voluntary surveys to the public. See J. Lubbers, Paperwork 
Redux: The (Stronger) Paperwork Reduction Act of 1995, 49 Admin, L. 
Rev. 111,119 (1997). While this justification for the requirement 
does not appear to apply to an interpretation of a statutory 
requirement, we nonetheless are submitting this NOPR to OMB as a 
collection of information.
---------------------------------------------------------------------------

    30. Public Reporting Burden: The proposed communications and 
information sharing are voluntary, take place between various industry 
entities (and are not submitted to the Commission), and are intended to 
promote reliable service or operational planning. While the extent of 
such communications likely will vary significantly across the country, 
the following estimates represent an expected average. The annual 
estimates reflect burden for operational contacts and emergencies.

 FERC-923, Communication of Operational Information Between Natural Gas Pipelines and Electricity Transmission Operators, as Proposed in NOPR in Docket
                                                                    No. RM13-17 \57\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                           Number of
                                                           Number of     responses per  Average burden    Total annual burden
                    Type of entity                        respondents     respondent       hours per             hours            Total annual cost \59\
                                                                             \58\          response
(1)                                                                (2)             (3)             (4)        (2)*(3)*(4) = (5)   (5)*($60.41/hr.) = (6)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Public Utility Transmission Provider..................        \60\ 132              12            0.50                      792                  $47,845
Interstate Natural Gas Pipelines......................        \61\ 137              12            0.50                      822                   49,657
                                                       -------------------------------------------------------------------------------------------------
    Total.............................................             269              12            0.50                    1,614                   97,502
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Title: Communication of Operational Information between Natural Gas 
Pipelines and Electricity Transmission Operators.
---------------------------------------------------------------------------

    \57\ Columns 5 and 6 are rounded.
    \58\ The Commission estimates an annual average per entity of 12 
responses (including electricity and gas emergency and/or 
operational contacts).
    \59\ The hourly costs (for salary plus benefits) are based on 
the Bureau of Labor Statistics Occupational Outlook Handbook, 2012-
2013 edition (at http://www.bls.gov/ooh/). The estimated costs are 
$125,647 annually or $60.41 hourly.
    \60\ Of the 132 public utility transmission providers, 5 are 
considered ``small'' using the SBA definition.
    \61\ The 2012 filings of the Forms 2 and 2A indicated that there 
are 137 interstate natural gas pipelines. Of those pipelines, eight 
(8) are considered small using the definition of the Small Business 
Administration (at 13 CFR 121.301), including the affiliate.
---------------------------------------------------------------------------

    Action: Proposed FERC-923.

[[Page 44907]]

    OMB Control No.: To be determined (1902-TBD).
    Respondents: Public electricity transmission providers; interstate 
natural gas pipelines.
    Frequency of Responses: As needed.
    Necessity of the Information: In this NOPR, the Commission is 
seeking comment on a proposal to revise Parts 38 and 284 of the 
Commission's regulations to authorize electric transmission providers 
and interstate natural gas pipelines to share non-public, operational 
information for the purpose of promoting reliable service and 
operational planning.
    31. This proposal is intended to address industry concerns and 
thereby remove any barriers, real or perceived, to electric 
transmission operators and natural gas pipelines sharing necessary 
information. The Commission is not requiring that data be submitted to 
the Commission or to third parties. Rather, the Commission is removing 
actual or perceived barriers to voluntary communications and 
information sharing that might otherwise have been part of the normal 
business process.
    32. Internal Review: The Commission will submit the information 
collection requirements to OMB for its review and approval under 
section 3507(d) of the PRA. Comments are solicited on the need and 
utility for this information, and the accuracy of the provided burden 
estimate.
    33. Interested persons may obtain information on the reporting 
requirements by contacting the following: Federal Energy Regulatory 
Commission, 888 First Street NE., Washington, DC 20426 [Attention: 
Ellen Brown, Office of the Executive Director, email: 
DataClearance@ferc.gov, phone: (202) 502-8663, fax: (202) 273-0873]. 
Please send comments concerning the collection of information and the 
associated burden estimates to the Commission, and to the Office of 
Management and Budget, Office of Information and Regulatory Affairs, 
Washington, DC 20503 [Attention: Desk Officer for the Federal Energy 
Regulatory Commission, phone: (202) 395-4638, fax: (202) 395-7285]. For 
security reasons, comments to OMB should be submitted by email to: 
oira_submission@omb.eop.gov. Comments submitted to OMB should include 
Docket Number RM13-17, FERC-923, and OMB Control Number 1902-TBD.

IV. Environmental Analysis

    34. 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.\62\ The 
Commission concludes that neither an Environmental Assessment nor an 
Environmental Impact Statement is required for this Final Rule under 
section 380.4(a)(2)(ii) of the Commission's regulations, which provides 
a categorical exemption for proposals for legislation and promulgation 
of rules that are clarifying, corrective, or procedural, or that do not 
substantively change the effect of legislation or regulations being 
amended.\63\
---------------------------------------------------------------------------

    \62\ Regulations Implementing the National Environmental Policy 
Act of 1969, Order No. 486, 52 FR 47,897 (Dec. 17, 1987), FERC 
Stats. & Regs., Regulations Preambles 1986-1990 ] 30,783 (1987).
    \63\ 18 CFR 380.4(a)(2)(ii) (2012).
---------------------------------------------------------------------------

V. Regulatory Flexibility Act Certification

    35. The Regulatory Flexibility Act of 1980 (RFA) \64\ generally 
requires a description and analysis of proposed rules that will have 
significant economic impact on a substantial number of small entities. 
The RFA mandates consideration of regulatory alternatives that 
accomplish the stated objectives of a proposed rule and that minimize 
any significant economic impact on a substantial number of small 
entities. The Small Business Administration's (SBA's) Office of Size 
Standards develops the numerical definition of a small business.\65\ 
The SBA has established a size standard, for electric utilities, 
electric power distribution, and electric bulk power transmission and 
control, stating that a firm is small if, including its affiliates, it 
is primarily engaged in the transmission, generation and/or 
distribution of electric energy for sale and its total electric output 
for the preceding fiscal year did not exceed four million megawatt 
hours.\66\ For pipeline transportation of natural gas, the SBA defines 
a small entity as having a maximum annual receipt of $25.5 million 
dollars.\67\ The Commission estimates a total of 13 ``small'' entities 
\68\ (or 5% out of the total 269 entities) affected by the NOPR.
---------------------------------------------------------------------------

    \64\ 5 U.S.C. 601-612 (2006).
    \65\ 13 CFR 121.101 (2012).
    \66\ 13 CFR 121.201, Sector 22, Subsector 221, Utilities & n.1.
    \67\ Based on 13 CFR 121.201, Sectors 48-49, Subsector 486, 
Pipeline Transportation, the annual receipts indicate the maximum 
allowed for a concern and its affiliates to be considered ``small.''
    \68\ Based on the SBA definitions and including affiliates, the 
number of ``small'' entities is estimated to be:
     for public utility transmission providers, 5 small 
public utilities; and
     for natural gas pipelines, 8 small interstate natural 
gas pipelines.
---------------------------------------------------------------------------

    36. To address industry concerns, the Commission is removing actual 
or perceived barriers to communications and information sharing (that 
might otherwise have been part of the normal business process). This 
proposal will enable entities of all sizes to communicate voluntarily 
and to share non-public, operational information for the purpose of 
promoting reliable service or operational planning, thereby easing and 
improving the normal business process. The estimated annual cost of the 
proposal for each respondent, large or small, is $362.46.\69\ 
Accordingly, the Commission certifies that the revised requirements set 
forth in the Notice of Proposed Rulemaking will not have a significant 
economic impact on a substantial number of small entities, and no 
regulatory flexibility analysis is required.
---------------------------------------------------------------------------

    \69\ The estimated annual cost per respondent is $362.46 (12 
annual responses x 0.50 hour/response x $60.41/hour).
---------------------------------------------------------------------------

VI. Comment Procedures

    37. The Commission invites interested persons to submit comments on 
the matters and issues proposed in this notice to be adopted, including 
any related matters or alternative proposals that commenters may wish 
to discuss. Comments are due August 26, 2013. Comments must refer to 
Docket No. RM13-17, and must include the commenter's name, the 
organization they represent, if applicable, and their address in their 
comments.
    38. 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.
    39. 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.
    40. 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.

[[Page 44908]]

VII. Document Availability

    41. 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.
    42. 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.
    43. 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 38

    Conflict of interests, Electric power plants, Electric utilities, 
Incorporation by reference, Reporting and recordkeeping requirements.

 18 CFR Part 284

    Incorporation by reference, Natural gas, 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 
Part 38 and Part 284, Chapter I, Title 18, Code of Federal Regulations, 
as follows:

PART 38--BUSINESS PRACTICE STANDARDS AND COMMUNICATION PROTOCOLS 
FOR PUBLIC UTILITIES

0
1. The authority citation for Part 38 continues to read as follows:

    Authority:  16 U.S.C. 791-825r, 2601-2645; 31 U.S.C. 9701; 42 
U.S.C. 7101-7352.

0
2. The heading of Part 38 is revised to read as follows:

PART 38--STANDARDS FOR PUBLIC UTILITY BUSINESS OPERATIONS AND 
COMMUNICATIONS


Sec.  38.1  [Removed]

0
3. Remove Sec.  38.1.


Sec.  38.2  [Redesignated as Sec.  38.1]

0
4. Redesignate Sec.  38.2 as Sec.  38.1.
0
5. In newly redesignated Sec.  38.1, paragraph (a) is revised to read 
as follows:


Sec.  38.1  Incorporation by reference of North American Energy 
Standards Board Wholesale Electric Quadrant standards.

    (a) Any public utility that owns, operates, or controls facilities 
used for the transmission of electric energy in interstate commerce or 
for the sale of electric energy at wholesale in interstate commerce and 
any non-public utility that seeks voluntary compliance with 
jurisdictional transmission tariff reciprocity conditions must comply 
with the following business practice and electronic communication 
standards promulgated by the North American Energy Standards Board 
Wholesale Electric Quadrant, which are incorporated herein by 
reference:
* * * * *
0
6. New Sec.  38.2 is added to read as follows:


Sec.  38.2  Communication and information sharing among public 
utilities and pipelines.

    (a) Any public utility that owns, operates, or controls facilities 
used for the transmission of electric energy in interstate commerce is 
authorized to share non-public, operational information with a 
pipeline, as defined in Sec.  284.12(b)(4), or another public utility 
covered by this section for the purpose of promoting reliable service 
or operational planning.
    (b) Except as permitted in paragraph (a), a public utility, as 
defined in Sec.  38.2, and its employees, contractors, consultants, and 
agents are prohibited from disclosing, or using anyone as a conduit for 
the disclosure of, non-public, operational information received from a 
pipeline pursuant to Sec.  284.12(b)(4) to a third party or to its 
marketing function employees as that term is defined in Sec.  358.3(d).

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

0
7. The authority citation for Part 284 continues to read as follows:

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

0
8. In Sec.  284.12, paragraph (b)(4) is added to read as follows:


Sec.  284.12  Standards for pipeline business operations and 
communications.

* * * * *
    (b) * * *
    (4) Communication and Information Sharing Among Pipelines and 
Public Utilities.
    (i) A pipeline is authorized to share non-public, operational 
information with a public utility, as defined in Sec.  38.2(a) or 
another pipeline covered by this section, for the purpose of promoting 
reliable service or operational planning.
    (ii) Except as permitted in paragraph (i), a pipeline and its 
employees, contractors, consultants, and agents are prohibited from 
disclosing, or using anyone as a conduit for the disclosure of, non-
public, operational information received from a public utility pursuant 
to Sec.  38.2 to a third party or to its marketing function employees 
as that term is defined in Sec.  358.3(d).

    Note: The following appendix will not appear in the Code of 
Federal Regulations.

Appendix

                  List of Commenters and Abbreviations
------------------------------------------------------------------------
            Abbreviation                             Name
------------------------------------------------------------------------
AEP.................................  American Electric Power Service
                                       Corporation.
AF&PA...............................  American Forest & Paper
                                       Association.
AGA.................................  American Gas Association.
APGA................................  American Public Gas Association.
BPA.................................  Bonneville Power Administration.
CAISO...............................  California Independent System
                                       Operator Corporation.
EPSA................................  Electric Power Supply Association.
ERCOT...............................  Electric Reliability Council of
                                       Texas, Inc.
FES.................................  First Energy Solutions.
INGAA...............................  Interstate Natural Gas Association
                                       of America.
ISO-NE..............................  ISO New England, Inc.
MidAmerican.........................  MidAmerican Energy Holdings
                                       Company.
MISO \70\...........................  Midwest Independent Transmission
                                       System Operator, Inc.
MMWEC...............................  Massachusetts Municipal Wholesale
                                       Electric Company.
National Grid.......................  National Grid USA, Inc.
NE LDCs.............................  New England Local Distribution
                                       Companies.
NERC................................  North American Electric
                                       Reliability Corporation.
NYISO...............................  New York Independent System
                                       Operator.
NYTOs...............................  New York Transmission Owners.

[[Page 44909]]

 
NIPSCO..............................  Northern Indiana Public Service
                                       Company.
PG&E................................  Pacific Gas and Electric Company.
PJM.................................  PJM Interconnection, L.L.C.
Texas PUC...........................  Public Utility Commission of
                                       Texas.
SCE.................................  Southern California Edison
                                       Company.
Spectra.............................  Spectra Energy Transmission, LLC.
SPP.................................  Southwest Power Pool, Inc.
We Energies.........................  Wisconsin Electric Power Company
                                       and Wisconsin Gas LLC.
------------------------------------------------------------------------

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

    \70\ Effective April 26, 2013, MISO changed its name from 
``Midwest Independent Transmission System Operator, Inc.'' to 
``Midcontinent Independent System Operator, Inc.''
---------------------------------------------------------------------------

[FR Doc. 2013-17682 Filed 7-24-13; 8:45 am]
BILLING CODE 6717-01-P