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Daily Rules, Proposed Rules, and Notices of the Federal Government

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Parts 35, 131, 154, 157, 250, 281, 284, 300, 341, 344, 346, 347, 348, 375 and 385

[Docket No. RM01-5-000; Order No. 714]

Electronic Tariff Filings

AGENCY: Federal Energy Regulatory Commission, DOE.
ACTION: Final rule.
SUMMARY: The Federal Energy Regulatory Commission is revising its regulations to require that all tariffs and tariff revisions and rate change applications for the public utilities, natural gas pipelines, oil pipelines and power administrations be filed electronically according to a set of standards developed in conjunction with the North American Energy Standards Board. This rule is part of the Commission's efforts to comply with the Paperwork Reduction Act, the Government Paperwork Elimination Act (GPEA), and the E-Government Act of 2002 by developing the capability to file electronically with the Commission via the Internet. Electronic filing reduces physical storage space needs and document processing time, provides for easier tracking of document filing activity; potentially reduces mailing and courier fees; allows concurrent access to the tariff filing by multiple parties as well as the ability to download and print tariff filings; and provides automatic e-mail notification to an applicant of receipt of the filing and whether or not it has been accepted. Upon implementation of this rule, the Commission will no longer accept tariff filings submitted in paper format.
Issued September 19, 2008.
DATES: Effective Dates:This rule will become effective November 3, 2008. Implementation will begin April 1, 2010 pursuant to a six month staggered schedule.
FOR FURTHER INFORMATION CONTACT: H. Keith Pierce (Technical Information),Office of Energy Market Regulation,Federal Energy Regulatory Commission,888 First Street, NE.,Washington, DC 20426, (202) 502-8525,Keith.Pierce@ferc.gov. Anthony Barracchini (IT Information), Office of the Executive Director, Federal Energy Regulatory Commission,888 First Street, NE.,Washington, DC 20426, (202) 502-8940,Anthony.Barracchini@ferc.gov. Andre Goodson (Legal Information), Office of the General Counsel, Federal Energy Regulatory Commission,888 First Street, NE.,Washington, DC 20426, (202) 502-8560,Andre.Goodson@ferc.gov.
SUPPLEMENTARY INFORMATION:

Table of Contents Paragraph

  • number
  • I. Background 2. II. Discussion 9. A. Electronic Filing Requirements 15. 1. Companies Required to File Tariffs Electronically 15. 2. Procedures for Making Tariff Filings 16. 3. XML Schema and Tariff Database 23. B. Tariff Filing Requirements 33. 1. Sheets or Section Filing Requirements 35. 2. Gas and Electric Open Access Transmission Tariffs 40. 3. Versioning 46. 4. Marked Tariff Changes 52. 5. Clean Tariff Sheets Filed as Attachments 58. 6. Joint, Shared, and Section 206 Filings 60. a. Joint Tariff Filings 61. b. Shared Tariffs 65. c. Section 206 Filings Related to ISOs/RTOs 74. C. Other Business Practice Changes 77. 1. Electronic Service 77. 2. Attachment Documents 79. 3. Withdrawal of Pending Tariff Filings and Amendments to Tariff Filings 80. 4. Motions 83. 5. Rate Sheets for Tariff Filings by Intrastate and Hinshaw Pipelines 84. D. Regulatory Text 86. E. Transition Procedures 87. 1. Testing of Software 87. 2. Baseline Tariff Filings 92. 3. Implementation Date for eTariff 102. III. Information Collection Statement 105. A. Comments on the NOPR's Burden Estimates 107. B. Burden Estimates 113. IV. Environmental Analysis 119. V. Regulatory Flexibility Act 120. VI. Document Availability 122. VII. Effective Date and Congressional Notification 125. Regulatory Text Appendix Before Commissioners:Joseph T. Kelliher, Chairman; Suedeen G. Kelly, Marc Spitzer,Philip D. Moeller, and Jon Wellinghoff.

    1. The Commission in the last several years has expanded its capability to accept electronic filings. As part of this process, the Commission has sought to develop a means by which publicly regulated utilities could file tariffs, rate schedules, and other jurisdictional contracts and agreements electronically in a fashion that would permit the Commission to assemble and organize the disparate pieces of these agreements for display and for use by the Commission and the public. Commission staff in collaboration with the wholesale electric and gas quadrants of the North American Energy Standards Board (NAESB), and representatives from the Association of Oil Pipelines (AOPL) developed a set of standards to be used by companies in making tariff and tariff related filings at the Commission. The Commission is adopting these standards as the requirement for making tariff and tariff related filings.

    I. Background

    2. The development of these standards began in 2004 with a Notice of Proposed Rulemaking1 in which the Commission proposed to require public utilities, power administrations, interstate and intrastate gas pipelines, and oil pipelines to file tariff and tariff related material electronically. The Commission proposed to develop an electronic tariff database to store tariff and tariff related information for retrieval by Commission staff and the public. In order to implement a tariff database system that would permit such functionality, Commission staff developed a software system for tariff filings similar to that used in filing forms with the Commission. Commission staff worked with many industry representatives and experts to test this software and held public meetings to demonstrate and receive comment on the software.

    1 Electronic Tariff Filings,Notice of Proposed Rulemaking 69 FR 43,929 (July 23, 2004) FERC Stats. & Regs., Proposed Regulations 2004-2007 ¶ 32,575 (2004) (2004 NOPR),Notice of Additional Proposals and Procedures,70 FR 40941 (July 15, 2005), FERC Stats. & Regs. ¶ 35,551 (2005) (2005 Notice). The 2004 NOPR was the result of an earlier Notice of Inquiry and Informal Conference in this same proceeding (Electronic Tariff Filings,66 FR 15673 (March 20, 2001), FERC Stats. & Regs. ¶ 35,538, at 35,789-91 (2001)).

    3. While some commenters supported using the Commission-provided software as an acceptable solution, others were concerned that this software might not work well for making tariff filings. Some also were concerned that the Commission software would not integrate well with their existing tariff management systems and that formatting tariffs to fit the parameters of the software could be difficult or time consuming.

    4. As a result of the review of the comments, on February 1, 2007, a public meeting was held with NAESB to discuss NAESB's assistance in the process of developing the protocols, standards, and data formats needed to provide tariff and related data to enable the Commission to develop a database to track electronic tariff and rate schedules filings. At the meeting, NAESB agreed to develop these standards and report back to the Commission.

    5. NAESB established two committees, a business eTariff Subcommittee and an eTariff Technical Task Force. These committees included representatives from the wholesale natural gas industry, wholesale electric industry, oil pipelines, intrastate natural gas pipelines, and third party software developers who worked along with Commission staff to develop the applicable standards. Between February 1, 2007 and January 23, 2008, these committees held a total of 16 meetings in various cities over 24 days. Total attendance in all the meetings was 991 participants either in person or by electronic conferencing, with an average attendance of 62 people for each meeting.

    6. The committees determined not to use the Commission developed software, but instead to develop standards that would enable individual companies to develop or procure software for making tariff filings that would best meet the needs of each company's business requirements. The Executive Committees for both the Wholesale Gas and Wholesale Electric Quadrants of NAESB approved the standards on March 4, 2008, and the NAESB membership ratified the standards on April 4, 2008.

    7. On April 15, 2008, NAESB filed the standards with the Commission along with a record of the NAESB proceedings. This material included questions about the policies to be followed in using the standards to make tariff filings. NAESB also provided a copyright waiver stating: “While the eTariff standards are copyrighted by NAESB, a limited waiver is granted to the FERC to modify and post any excerpts of the eTariff standards and eTariff work products that they deem appropriate. These excerpts will be available for companies to reproduce only for their own internal use.”

    8. On April 17, 2008, the Commission issued a Supplemental Notice of Proposed Rulemaking (NOPR) proposing to use the NAESB developed standards as the means to effectuate electronic tariff filing.2 The NOPR also proposed solutions to several issues raised during the NAESB process, such as the filing process for shared and joint tariffs. Twenty comments were filed, with most generally favoring the use of the NAESB standards.3

    2As used in this Final Rule, the “NAESB standards” or “standards” refer to a set of data elements and requirements that are posted on the Commission Web site.Instruction Manual for Electronic Filing of Parts 35, 154, 300, 341 and 284 Tariff Filings.(http://elibrary.ferc.gov/idmws/common/OpenNat.asp?fileID=11683627)

    3Appendix A lists the commenters and the abbreviations used for each.

    II. Discussion

    9. As the background indicated, this proceeding has followed a long and winding road, with a number of detours and U-turns, but we have reached the end of the road and are adopting a final set of standards for electronic tariff filings.4 We again want to thankNAESB, its Board of Directors, and the numerous volunteers from across the spectrum of the gas, electric, and oil industries who were able to meet with staff and develop a set of standards and protocols that will achieve the Commission's goal of establishing a robust electronic filing environment for tariffs and tariff related material and will make it possible for the Commission staff and the public to retrieve this material from a database. We will adopt the standards and protocols developed through the NAESB collaborative process in place of providing Commission-created software. Adoption of these standards and protocols will provide each company with enhanced flexibility to develop software to better integrate tariff filings with their individual tariff maintenance and business needs. These standards and protocols also will provide an open platform permitting third-party software developers to create more efficient tariff filing and maintenance applications, which will spread the development costs over larger numbers of companies.

    4 Smithv.Lachter (In re Smith),352 B.R. 702 (B.A.P. 9th Cir. 2006) (“This matter is reminiscentof that old Beatles' standard, ‘The Long and Winding Road,’ a brooding song about a road that never ends. One can only hope that, with this opinion, the end of the road is indeed in sight”).

    10. Over the last few years, the Commission has greatly expanded its ability to accept electronically filed material, including interventions, protests, rehearings, complaints, and applications for certificates and licenses.5 We now are expanding these filings to include tariffs and tariff-related material, which comprise a large portion of the Commission's workload. But tariff filings raise special challenges that our current filing systems do not address. eLibrary is designed and works extremely well as a repository that stores, and permits retrieval of, all documents filed in individual docketed proceedings. But while an individual tariff filing is made in an individual docket, the tariff itself is an organically changing document that is comprised of individual filings made in many different dockets over time. In order for the Commission and the public to obtain a complete picture of a company's tariff, these various provisions need to be integrated into a single system that will provide information as to the status of tariff provisions, permit the assembly of a complete tariff, and permit tariff related research. Indeed, for tariffs filed on paper, the Commission has managed these tariffs as a database by keeping tariff books, open to the public at our headquarters, in which new pages are inserted to replace old pages to reflect revisions, and such changes are recorded in “numbering” sheets to ensure that the tariff reflects the currently effective tariff.6 The standards we are adopting in this Final Rule merely replace this paper system with a very similar electronic database that will similarly track the tariff submissions and tariff history, but in a form that will make tariff information more widely available over the Internet.

    5 See Electronic Registration,Order No. 891, 67 FR 52,406 (Aug. 12, 2002), FERC Stats. & Regs. ¶ 31,132 (2002);Electronic Filing of FERC Form 1,and Elimination of Certain Designated Schedules in Form Nos. 1 and 1F, Order No. 626, 67 FR 36,093 (May 23, 2002), FERC Stats. & Regs. ¶ 31,130 (2002);Electronic Service of Documents,66 FR 50,591 (Oct. 4, 2001), FERC Stats. & Regs. ¶ 35,539 (2001);Revised Public Utility Filing Requirements,Order No. 2001, 67 FR 31,043 (May 8, 2002), FERC Stats. & Regs. ¶ 31,127 (2002);Electronic Filing of Documents,Order No. 619, 65 FR 57,088 (Sept. 21, 2000), FERC Stats. & Regs. ¶ 31,107 (2000);Electronic Notification of Commission Issuances,Notice of Proposed Rulemaking, FERC Stats. & Regs. ¶ 32,574 (2004);Filing Via the Internet,Order No. 703, 72 FR 65,659 (Nov. 23, 2007), FERC Stats. & Regs. ¶ 31,259, P 33 (2007) (Order No. 703).

    6In fact, companies often arrange to view their own tariffs to try and recreate either effective tariffs or the tariff in effect during the time period of a particular proceeding.

    11. The database will provide easier access to tariffs and allow the viewing of proposed tariff sections in context. One of the principal benefits of such a database is the ability to do historical research into tariffs. For example, proceedings such as complaints may involve past tariff provisions that have already been revised by the utility by the time the complaint is considered by the Commission. In order to expeditiously process such filings, the Commission, the parties, and the public need to be able to obtain the tariff provision that applies to the time period under review, rather than the currently effective tariff provision. In fact, the effectiveness of tariff provisions arises in a number of contexts, particularly in complaint cases, in which the Commission and the participants need to know the effective tariff at a particular point in time.7

    7 See FPL Energy Marcus Hook, L.P.v.PJM Interconnection, LLC,123 FERC ¶ 61,289, at P 39 n.77, 77-80 (2008) (in a complaint case, the complainant and all other parties relied on the current version of a tariff provision rather than the provision in effect at the time).

    12. The set of NAESB standards provides a foundation for building such a database. The standards define an extensible markup language (XML) schema8 that will permit filers to assemble an XML filing package that includes the tariff changes, the accompanying tariff-related documents, such as the transmittal letter, rate schedules, and spreadsheets that are required to accompany various tariff filings, and other required information such as the proposed effective date of the filing. Upon the receipt of the filing electronically, the XML schema will enable the Commission to parse9 (divide) the filed package into its component parts, place the filed documents into its eLibrary system and provide the metadata10 that will permit automated organization of the tariff and permit the Commission and the public to search that database. As an example of the expanded public access to tariffs, the Commission currently provides electronic access to approximately 150 NGA interstate pipeline tariffs utilizing the FASTR standards. That access under the NAESB standards should expand to at least 1600 companies' tariffs. The NAESB standards also will provide flexibility to companies making tariff filings by enabling each regulated company to design or purchase software for creating tariff filings that will best accommodate its filing patterns and needs.

    8XML schemas facilitate the sharing of data across different information systems, particularly via the Internet, by structuring the data using tags to identify particular data elements. For example, each filed tariff change will include tags for the relevant information, such as the utility name, the tariff section being changed, the name for that section, the proposed effective date, and certain sections of tariff text. The tagged information can be extracted and separately searched.

    9Parse means to capture the hierarchy of the text in the XML file and transform it into a form suitable for further processing.

    10The term metadata is based on the Greek word “meta” meaning after or beyond and in epistemology means “about.” Thus, metadata is data or information beyond or about other data. Digital Libraries, by William Arms (M.I.T. Press 2000),http://www.cs.cornell.edu/wya/DigLib/MS1999/Chapter1.html(visited April 11, 2008); The University of Queensland,http://www.library.uq.edu.au/iad/ctmeta4.html(visited April 11, 2008); The Linux Information Project,http://www.linfo.org/metadata.html(visited April 11, 2008). For example, in the XML schema, one required element is a proposed effective date and another element is the text of the tariff provision. The proposed effective date would be considered metadata relative to the tariff text.

    13. Some of the principal requirements of the standards and regulations being adopted here are:

    • Tariffs11 may be filed either using the current sheet based nomenclature or using section-based numbering at the choice of the filer.12

    11The term tariff is used herein to refer to tariffs, rate schedules, jurisdictional contracts, and other jurisdictional agreements that are required to be on file with the Commission.

    12Section-based filings will not have to include the sheet based nomenclature as a header or footer on the tariff page.

    • Tariffs may be filed as entire documents in either of two electronic formats, RTF13 orPDF,14 except with respect to open access transmission tariffs for electric utilities and interstate natural gas companies which would have to be filed as individual sheets or as sections in RTF format as defined in the regulations.

    13RTF refers to Rich Text Format which is a standardized textual format that can be produced by a number of word processors.

    14PDF refers to Portable Document Format which is a format used for representing documents that closely resembles the original formatting of the document.

    • Tariff filings can be served electronically using the same approach used for electronic service of other Commission filings.

    • Filings of joint tariffs (tariffs covering two regulated entities) may be made with a single tariff filing by the entity designated to make the filing.

    • Tariff filings for tariffs shared among companies (such as regional transmission organization (RTO) tariffs) can be made individually by any of the companies with rights to file tariff changes.

    • During initial baseline implementation of electronic tariff filing, only open access transmission tariffs (OATTs) and agreements need to be filed.

    • After implementation of electronic tariff filing, all new tariffs and agreements must be filed using the standards. Existing agreements need to be filed electronically only when they are revised.

    14. Although the comments generally supported the adoption of the NAESB standards, some commenters suggested the adoption of alternative approaches. As the Commission has previously stated: “Standardization, by definition, requires accommodation of varying interests and needs, and rarely can there be a perfect standard satisfactory to all.”15 We find that the NAESB standards best accommodate the needs of regulated utilities in making filings electronically and the needs of the Commission and the public for an electronic system that will enable efficient, user-friendly retrieval of tariffs. We will discuss below the technical requirements applicable to electronic tariff filing and the comments received on various aspects of the standards.

    15 Standards For Business Practices Of Interstate Natural Gas Pipelines,Order No. 587, 61 FR 39,053, 39,057 (July 26, 1996), FERC Stats. & Regs. ¶ 31,038, at 30,059 (1996).

    A. Electronic Filing Requirements 1. Companies Required To File Tariffs Electronically

    15. The companies or entities covered by this Final Rule are those that submit tariffs, rates, or contracts with the Commission pursuant to the Natural Gas Act (NGA), the Natural Gas Policy Act of 1978 (NGPA), the Federal Power Act (FPA), the Interstate Commerce Act (ICA), the Flood Control Act, the Bonneville Power Act, the Northwest Power Planning Act, and other relevant statutes. Included among the companies or entities covered by the requirements are: RTOs and independent system operators (ISOs); power authorities and federal power marketing administrations which file rates, contracts, or tariffs at the Commission; intrastate natural gas pipelines that file rates and operating conditions pursuant to the NGPA; interstate natural gas pipelines subject to the NGA which serve only an industrial customer; and companies or entities that may make voluntary tariff filings, such as reciprocity filings pursuant to Order No. 888.

    2. Procedures for Making Tariff Filings

    16. Using the new XML schema, companies, and all those authorized to make filings on behalf of the company, such as outside counsel, will make tariff related filings using the existing eFiling portal. As described below, the filing process will be modified slightly from the current eFiling process, in particular to include a company registration that will provide increased security for the filing, as well as additional e-mail notifications of potential problems with the filing.

    17. The person making a tariff filing must have previously registered in eFiling (Filer). Upon successfully logging into the FERC eFiling portal, the Filer will be presented with the introductory screen indicating success in accessing the site, and presented with a link to the filing creation part of the site, which will include an option to make a Tariff filing (eTariff portal).

    18. The eTariff portal will prompt the Filer to enter the company identification number assigned during the company registration process and an associated password. After successfully passing this step, the Filer will upload an eTariff XML filing package that conforms to the XML schema. Once the filing is uploaded, the eFiling web page will indicate the filing has been submitted.

    19. After the filing has been submitted, a Confirmation of Receipt will be e-mailed to both the e-mail address of the Filer and to the e-mail address on file with FERC for the company identification number. This e-mail only acknowledges the receipt of the filing through the eFiling portal, provides a timestamp, and indicates that the filing is placed in the queue to be processed.

    20. The XML filing package will be validated programmatically by an eTariff verification process. Depending upon the success of the verification process, a number of e-mails will be sent.

    Trying to keeping trackof,\

    • If the verification is completed successfully, an e-mail will be sent to the validation e-mail address provided in the XML package and to the e-mail address associated with the company whose tariff is being revised.16 This e-mail means only that the filing has passed the validation, not that it has been officially accepted by the Secretary of the Commission.

    16This may not be the same company making the filing; for example, in the case of a shared tariff, one notification will go to the company making the filing and the other will go to the ISO or RTO whose tariff is being revised.

    • If the XML filing package can be parsed (and the validation e-mail address can be obtained), but the package does not otherwise pass verification, an e-mail will be sent to the validation e-mail address provided in the XML filing package. This e-mail will provide information about the problems encountered during the verification process.

    • If the XML filing package cannot be parsed at all (is unreadable), an e-mail will be sent to the Filer and to the e-mail address associated with the company identification number indicating a problem has been encountered with the filing.

    21. Once passed validation, the standard eFiling e-mail will be sent to indicate whether the Secretary of the Commission has accepted and docketed the filing or rejected it. As occurs with all filings, the docketing e-mail does not guarantee that other filing deficiencies will not result in rejection or other action pertaining to the filing later in the review processes within the Commission. After this step, the filing is passed on to eLibrary, the tariff database and other Commission systems.

    22. INGAA requests that the Commission establish a procedure for submission of tariff filings in the event of an electronic failure of the Commission's eFiling and eTariff system. Such a request is beyond the scope of this rulemaking. In Order No. 703, the Commission delegated to the Secretary of the Commission the authority to develop procedures for electronic filing, including procedures to be followed in case of an electronic failure of the eFiling system.17 Since the tariff filing component will be a part of the eFiling system, the same procedures followed by the Secretary for electronic failure will apply to eTariff as well.

    17 Filing Via the Internet,Order No. 703, 72 FR 65659, FERC Stats. & Regs. ¶ 31,259, at P 33 (2007).

    3. XML Schema and Tariff Database

    23. Under the standards, the tariff filing must be made in conformance with the XML schema. The schema essentially is a method by which the filing entities can communicate information to the Commission. The schema proscribes the metadata elements and the textual information that must be included in the filingpackage. The data elements included in the XML package are required to properly identify the nature of the tariff filing, organize the tariff database, and maintain the proper relationship of tariff provisions in relation to other provisions. For example, these elements will identify which tariff provision is being revised so that the revised tariff provision can be placed electronically in the proper location within the tariff hierarchy. The filing package itself will include the text of tariff changes as well as all filing attachments, such as transmittal letters.18 The XML schema will be maintained on the Commission Web site along with the required codes, descriptions, and other requirements, as well as information that may be useful to those developing filing software.19 Contemporaneously with the issuance of this Final Rule, we are posting on the Web site the XML schema along with the descriptions of the fields used in the schema, the instruction manual and codes to be used with the XML schema.

    18The XML package must be filed as a zip (compressed) file.

    19Currently located athttp://www.ferc.govunder the tab Documents and Filings, eTariff.

    24. Although we do not envision that the schema and related code values will need to be changed frequently, the Secretary of the Commission, under Order No. 703, has delegated authority to make modifications to them if necessary.20 Before any such changes are made, a notice of the proposed change will be issued sufficiently in advance to permit companies to revise their software.

    2018 CFR 375.302(z).

    25. A few commenters object to the use of the XML schema for electronic filing and argue that the Commission should simply rely on filings in eLibrary.21 They argue that documents are maintained in standard word processing formats and that filing such tariffs through eLibrary would be easier on the filer. They assert that any tracking of such filings could be accomplished by assigning a docket number. Nevada Power, for example, argues that managing tariffs is a document management, rather than a database function. It maintains that the ability to access prior tariffs can be solved by retaining all previous effective versions of the tariff.

    21Duke Energy, EEI, Nevada Power, Southern California Edison, and PSEG.

    26. As explained above, eLibrary is principally a system that manages and tracks filed documents based on individual proceedings (dockets). It was neither designed, nor will it function well, to retrieve individual sections or pages of tariffs that are filed in different dockets over the course of many years. The tariff database, on the other hand, will enable the Commission staff, as well as the public, to access all or portions of a company's tariffs and rate schedules compiled using date, text, and status criteria.

    27. The use of a database to track individual pages or sections of tariffs is not inappropriate to the task of managing tariffs, as the comments suggest. The Commission has for over twenty years maintained the FASTR database for gas tariff filings and has made the results of that database available to the public. The XML schema on which the industry agreed will update the FASTR methodology to provide an even more effective database for managing tariffs and conducting tariff searches.

    28. Some commenters suggest assigning a docket or other unique number to each tariff or rate schedule, and Nevada Power suggests that instead of an electronic database, each utility could file an updated history of changes to its tariff so that customers can determine where to find specific sheets in which they are interested. Nevada Power attached, as an example of its proposal, a history for its OATT that is only six pages long covering a relatively small number of tariff filings.

    29. These solutions would require users to search through reams of filing materials to obtain the particular section or page of the tariff that they need. Such solutions are not a reasonable substitute for a database, given the large number of gas, oil, and electric companies, some of whom may make hundreds of tariff filings a year, with a list of changes that would eventually grow to hundreds of pages using the Nevada Power approach. PJM Interconnection, LLC for example made over 130 tariff related filings in a one year period. Trying to keep track of, and find, particular tariff provisions in this massive amount of data using only a docket or other numeric identifier and a spreadsheet would be a monumental task.22 But the tariff database, using the metadata supplied with each filing, will be able to store and retrieve this information.

    22Nevada Power's listing is similar to the Commission's current numbering sheets used in its paper tariff database. These numbering sheets run to 70 linear feet for all utilities. Using such a system to research extensively revised tariffs is difficult, time consuming, and prone to error.

    30. Those arguing for an eLibrary approach envision that tariff documents would not be filed in individual sections, but as entire documents. But not all industry members supported this entire document approach. The gas pipelines, for example, supported the continued use of sheet-based filings in which utilities file only the specific tariff sheet that is being revised.23 Other tariffs are so large that filing them as a single document would be unwieldy.24 The flexibility to file tariffs using different approaches was key to developing the NAESB standards, and the industry consensus supporting those standards.25 The approach suggested by the commenters would not provide the flexibility the industry sought. The use of a database utilizing the NAESB standards provides that flexibility and is the most efficient method of processing such filings in a way that will permit the easy and efficient integration of such individual filings into an entire tariff.

    23Minutes of February 1, 2007 eTariff Meeting, (“Ms. Nagle [Tennessee Gas Pipeline] asked whether FERC Staff supported using a section-based tariff system (in lieu of a sheet based system) and if so does everyone need to move to the section-based system”),http://www.naesb.org/pdf2/etariff020107fm.doc.

    24For example, PJM's posted tariff is over 8 megabytes.http://www.pjm.com/documents/agreements.html, and the California ISO's tariff is over 4 megabytes. ISO New England (http://www.iso-ne.com/regulatory/tariff/index.html) and the New York ISO (http://www.nyiso.com/public/documents/tariffs/oatt.jsp) post tariffs that already are divided into sections.

    25Minutes of July 27, 2008 eTariff Meeting, at P 5 (“flexibility is present to support whole document filings, sheet based filings and section based filings. This flexibility is provided for individual companies and for the industries themselves, as a given company may choose to use any of the three choices depending on the filing to be made. This flexibility is a key underlining assumption from which all the work papers were developed and as such, was reflected in the vote just taken”),http://www.naesb.org/pdf3/etariff072707fm.doc.

    31. As we have discussed above, the development of standards requires cooperation and accommodation between companies with different needs and requirements. The NAESB process provided a means by which various members of the affected industries and customers, including those from the oil pipeline industry, could develop a set of standards that reasonably meet the needs of a large range of different types of tariff filers, large and small companies, frequent and infrequent tariff filers, companies using different methods of storing tariffs, including databases, word processing software, and spreadsheets. After examining a variety of alternative approaches over 24 days of meetings, a consensus of the gas and electric industry26 agreed upon the use of the data elements and XML schema as the most efficient means forelectronically filing tariffs.27 We therefore will adopt the database approach and standards as approved through the NAESB process.

    26Although the oil pipelines and their customers did not have an official vote during the NAESB process, they participated in formulating the requirements and have supported the data elements and XML schema in their comments in this rulemaking.

    27APS, an active participant in the beta testing of the Commission's original software, as well as a participant in the NAESB process, recognizes that the standards provide “a useable platform for industry compliance with the new standardized requirements for electronic filing of tariff, as well as a convenient tool for market participants and FERC staff to access and review tariffs and agreements * * * [and this methodology] to be the superior choice to implement this Commission requirement.” APS Comment, at 2. AOPL similarly recognizes that compromises were necessary to meet the needs of all the industries, stating the standards “reflect significant improvements to the proposed electronic filing regulations, in light of the particular circumstances and needs of the oil pipeline industry.” AOPL Comment, at 1.

    32. CAISO asks that the RTOs not be required to provide all the metadata required by the standards or, if it is not possible to eliminate the metadata, that such metadata be kept to a minimum. The technical meetings with NAESB were designed to develop the minimum required metadata that would be necessary to feed and operate the database. The CAISO has not indicated specific metadata elements that can safely be eliminated and still maintain the integrity of the database.

    B. Tariff Filing Requirements

    33. The Commission's current regulations require companies to file tariff sheets that include specifically defined nomenclature to identify each sheet of the tariff.28 A company is required to file only the tariff sheets containing the tariff revisions or changes.

    2818 CFR 35.9; 154.102(e).

    34. Based on the NAESB meetings and the comments submitted, we will allow far more flexibility in the structure and identification of tariffs. Companies may determine to structure their tariffs either using the existing tariff sheet format or as sections. Companies will also be given more flexibility to file tariffs either by dividing the tariff into sheets or sections and filing only the revised sheet or section, or for a wide range of tariff documents, by filing the entire tariff document that is revised. In order to ensure that the Commission and the public have the ability to identify specific tariff provisions, versioning information is required to be included as part of the XML package. But, this information has been simplified and will no longer need to be included as text on individual sheets or sections, with the exception of certain documents filed as PDFs.

    1. Sheet or Section Filing Requirements

    35. In order to compile the tariff database, the standards require companies to file tariff text as a specific data element. Companies, however, will be permitted to choose whether to continue to number tariff provisions as individual tariff sheets (e.g., Sheet No. 1) or sections (e.g., Section 1.1.1). Except as discussed in the following section with respect to open access tariffs, companies will be allowed to determine based on the nature of the tariff and frequency of filing whether to file tariffs by breaking the tariff into sheets or sections or by filing the tariff as an entire document. Companies that initially file using the entire document option will be allowed later to divide the tariff document into sections or sheets. However, a company that has already broken its tariff into sections or sheets, will not be able to recompile those sheets or sections and use the entire document option unless a company files a request for waiver.

    36. The NAESB standards provide that tariff text must be filed either using the RTF file format or the PDF file format.29 Tariffs filed under the entire document option may be filed either in RTF or PDF. Tariffs filed as sections or sheets must be filed in RTF, due to limitations on the ability to process and assemble PDF files.30

    29The requirements adopted by the Commission in Order No. 703 will apply to PDF formatted documents filed as tariff text. Tariffs filed in PDF format must use the print-to-pdf feature as opposed to an unsearchable scanned format, except that tariff documents existing only on paper may be scanned into PDF. Order No. 703, FERC Stats. & Regs. ¶ 31,259 at P 23. We, however, encourage filers that scan old paper tariff documents to use an optical character recognition program to convert the scanned file to text prior to filing, so that copy and paste and search functions may be used.

    30RTF is a text format that will enable the Commission's software to assemble quickly the sheets or sections into a complete tariff document. In contrast, PDF is not a textual format, and does not permit such processing.

    37. The comments support the flexibility to use sheet, section, and entire document options using PDF format.31 AOPL for example “strenuously supports this aspect of the rule which provides benefits to both shippers and pipelines.”32

    31Midwest ISO, INGAA, and AOPL.

    32AOPL Comment, at 4.

    38. TransCanada asks that the Commission clarify whether and under what conditions companies that initially file using the sheet-based option may be allowed to later re-file using the section-based option, and vice-versa. For both the shipper and Commission staff benefit, we certainly would not encourage utilities to switch back and forth frequently between a sheet and a section-based system, because such a change will make the ability to research past provisions more difficult.33 But because both the sheet and section approaches provide equivalent granularity and flexibility for users, utilities can make such a change without obtaining special permission. The only time special permission is required is if a utility wants to covert from a sheet or section based approach to entire document, because such a change does reduce usability.

    33The database will store each sheet or section so that a user wishing to examine a past sheet or section can do so. If the utility decides to change between sheets and sections, the prior history of a particular provision may be more difficult to access. For example, in a sheet to section change, the past sheet (record) will still appear in the database, but it will not be linked to the section (record) that will replace it.

    39. AGA requests that tariffs be fully text searchable. As described above, all tariffs, including those filed using PDF, must be filed in text searchable format.

    2. Gas and Electric Open Access Transmission Tariffs

    40. Tariffs for interstate natural gas pipelines and electric utilities must be filed by breaking the document into sheets or sections. Unlike individual service agreements or contracts that affect only the signatories to the agreements, the open access transmission tariffs affect a wide variety of customers and are the most frequently revised. Moreover, because of the breadth of these tariffs, and the need to review and research portions of these tariffs, it would not be efficient for staff or for the public to have these documents refiled in their entirety every time a company proposes to revise an individual tariff section or page.

    41. We are revising §§ 35.9 and 154.102 to require that open access transmission tariffs, which will include other open access documents and documents of general applicability, such as ISO/RTO operating agreements and market rules, must be filed as sheets or sections. Because the electric OATTs are based on the Commission's pro forma OATT, we have specified the minimum required divisions for such filings. For non-ISO/RTO OATTs, the OATT must be divided at least at the section 1.0 level, with individual sections for each schedule or attachment. Because ISO/RTO OATTs are much more complex, ISO/RTOs will be required to divide their OATTs at the 1.1 level at a minimum. Filers are encouraged to use even smaller divisions that are appropriate to their individual tariffs and filing patterns. In addition, to aid electric utilities in filing their OATTs, we are posting on our Web site a pro forma OATT divided into the largestallowable sections, as well as information that will help companies develop Microsoft® Word macros to electronically divide tariffs at this level.

    42. Because we have not specified a pro forma interstate natural gas transportation tariff, the regulation we adopt requires that the interstate natural gas pipeline open access tariffs filed as sections be divided so that each section includes only related subject matter and is of reasonable length.34 Negotiated rate agreements and other non-conforming service agreements need not be divided, but can be filed as entire documents.

    3418 CFR 154.102.

    43. EEI requests that non-RTOs be allowed to file their OATTs as single documents, maintaining that these are relatively static documents and that allowing the filing of an entire document will reduce the time and expense necessary to break such tariffs into sections and may simplify the filing software that such companies need to build or acquire.

    44. We will not relax the requirement to at least divide the pro forma OATTs at the 1.0 level. As described above, OATTs can be large and unwieldy documents and run to over 160 pages; dividing the document at the 1.0 level will ensure that Commission staff and the public can review and search for tariff provisions relating to the same subject matter. Dividing the OATT at the 1.0 level will result in only 57 sections, each addressing a different topic, and such division will only have to be done once. Moreover, EEI maintains that most OATTs are maintained as Microsoft Word documents. Commission staff has developed and will post a macro that in many cases will divide the OATT at the appropriate level. Commission staff also has posted a pro forma OATT divided into the requisite sections that can be used as a reference. Creating the sectionalized pro forma OATT manually only took one hour. In balancing the burden of a one-time conversion of an OATT into individual sections against the benefits of being able to easily locate and search for specific OATT sections, we find that the benefits of requiring that OATTs be broken into sections outweigh the costs.

    45. AGA argues that the Commission should set a minimum requirement for gas pipelines similar to that set for electric utilities and suggests that the minimum should at least match the table of contents and include as a separate section each topic listed under General Terms and Conditions of Service. We find that this suggestion does provide useful guidance as to the minimum sections required and therefore revise the regulation in § 154.102 accordingly.

    3. Versioning

    46. The Commission currently requires each tariff page to include a version number that can be used to identify the particular revision of that page (e.g., First Revised Sheet No. 1 would replace Original Sheet No. 1). Because tariff provisions change, often frequently, this convention is useful over time for identifying and referring to particular tariff provisions in orders. With the adoption of the NAESB standards, the versioning requirement will be modified and made less complicated.

    47. The NAESB standards require that each sheet, section, or entire tariff document be identified with a version number in an x.y.z format.35 The x.y.z format will accommodate the same level of identification as our existing nomenclature, including items such as squeezed and retroactive sheets. As long as each tariff section, sheet, or entire document is identified uniquely, companies can choose how complex to make their identification. Some companies may want to continue this detailed approach to better identify the placement and relative position of tariff sheets and sections, and the x.y.z format will accommodate such identification. Other companies may not choose to include such a detailed hierarchy of changes. Companies, for example, may choose simply to numerically number each section, sheet, or entire tariff document as they file it, using just the x field.

    35The x.y.z format is a representation of the version (designation) of a tariff filing where “x” represents revision number for the given tariff provision (tariff record), “y” delineates that it is a substitute for a previously filed tariff provision, and “z” indicates that it is a “squeeze” tariff provision. A “squeeze” tariff provision occurs when a tariff provision needs to be made effective on a date which occurs between the effective dates of two tariff provisions that already are filed with the Commission.

    48. As proposed in the NOPR, and adopted in this Final Rule, identification of versioning need not be included in the text of the individual tariff revisions that are filed with the exception of tariffs filed in PDF format. Companies however may choose to include such identification in the tariff text if they desire. The XML schema requires that the requisite versioning information be included as metadata, and versioning information will be made available to staff and the public in the tariff database. Moreover, to ensure that the versioning information is available to the public on eLibrary, the Commission will use the metadata provided in the XML package to generate a document on eLibrary that contains the appropriate versioning information. Because we are creating this document by electronically combining information from the XML package, the formatting of the versions and tariff text may not appear identical to the filing made by the company.

    49. The only exception to this rule is for tariff documents filed using PDF. Because PDF is not a textual format and does not permit easy electronic manipulation, we cannot generate a document for eLibrary that contains the correct versioning information. For these documents, therefore, the Instruction Guide requires that the first page of the tariff document include the required information: Company name, tariff title (if applicable), and the appropriate version number.

    50. INGAA suggests that for gas tariffs, the regulations should continue to require that the first section or sheet of the tariff include: The FERC Gas Tariff Volume Number, the name of the natural gas company, as well as the name, title, address, telephone number, e-mail address and facsimile number of a person to whom communications concerning the tariff should be sent. We will modify the regulation to continue this requirement.

    51. EEI recommends that the Commission eliminate various formatting requirements required under Order No. 614.36 As we have discussed above, we are eliminating a variety of the required formatting requirements because they are included in the XML metadata and the other formatting requirements are included in the standards. As a result, the formatting and filing requirements of Order No. 614 have been supplanted by the regulations and requirements addressed in this rulemaking.37

    36 Designation of Electric Rate Schedule Sheets,Order No. 614, 65 FR 18,221 (Apr. 7, 2000), FERC Stats. & Regs. ¶ 31,096 (2000).

    37The provisions of § 35.5 regarding rejection of material (adopted in Order No. 614) are being retained. In filing pre-existing contracts and rate schedules, electric utilities are still required to eliminate the use of supplements and include in their filings only effective provisions.See18 CFR 35.1 (revised to remove the use of supplements);Boston Edison Company,98 FERC ¶ 61,292 (2002) (utilities must file effective tariff provisions);Vermont Yankee Nuclear Power Corporation,98 FERC ¶ 61,122, at 61,366 (2002) (utility required to remove tariff language that was no longer effective from its rate schedule).

    4. Marked Tariff Changes

    52. The Commission's current interstate natural gas pipeline (§ 154.201) and electric utility regulations (§ 35.10), require companiesto provide a marked version of the tariff text in the tariff filing indicating the changes and deletions made to the existing tariff text. The oil pipeline regulations (§ 341.3) provide for the use of special symbols to denote changes.

    53. We are continuing the requirement for filing marked versions of tariffs. We also are modifying the symbols used by the oil pipelines using the symbols proposed by AOPL so that the symbols can be entered into a find or search message box using keystrokes available on a keyboard. In contrast to past practice in which tariff changes were filed only as individual sheets or supplements, the standards permit tariff documents to be filed as large sections or as entire documents. Although we are confident that filing companies will not intentionally make unmarked changes to tariff text, we want to ensure that both staff and the public are not put in the position of having to read the entire tariff text of large sections or an entire document to ensure that unmarked changes were not made. As a precaution, therefore, we are revising our regulations to make clear that only the sections of the tariff document appropriately identified in the filing will be considered part of the filing and any acceptance of a filing by the Commission will not constitute acceptance of an unmarked tariff change.

    54. INGAA supports the regulation, but requests that the Commission modify it to state that “interested parties may comment only on those revisions appropriately designated and marked to constitute the filing; provided, however, comments on unmarked and undesignated language will be permitted when such comments provide useful information to the Commission for the resolution of issues directly related to the filing.” We will not adopt the proposed language as part of the regulation because, as INGAA itself recognizes, determinations as to the appropriateness of such comments need to be made on a case by case basis. The Commission must in individual cases determine if the protest or comment on the unchanged tariff text bears upon the justness and reasonableness of the proposed tariff change or is a request for the Commission to take action under section 5 of the Natural Gas Act to revise the unchanged provision.

    55. AOPL argues that the Commission should remove the proposed language in § 341.3 of the regulations arguing that a filed tariff change should be deemed effective even if a symbol is misplaced or incorrect. AOPL states that under long-standing ICA precedent the omission of a symbol in a tariff denoting a change in rate does not affect the validity or applicability of the tariff item.

    56. We never meant for this provision of the regulations to constitute a trap that would penalize an oil pipeline if it simply used the wrong symbol or failed to include a symbol in the tariff as long as its overall filing was sufficient to provide notice of the proposed change. We therefore have revised the regulation from that proposed in the NOPR to make clear the regulation does not apply to an improper or omitted symbol so long as the change is identified in the tariff filing.38 The purpose of this regulation is to ensure that shippers and the Commission receive the required notice of proposed changes by the pipeline and that shippers are not penalized by the failure of the pipeline to provide the requisite notice. As part of the NAESB process, agreement was reached on allowing oil pipelines to file entire tariffs as PDF files. Because of the nature of PDF files, however, it will be difficult for the Commission staff or the pipeline's customers to create a document comparison of a PDF document. Thus, the oil pipeline would be in the best position to create a document comparison, and we find the burden of ensuring proper notice legitimately should fall on the oil pipeline making the filing. The oil pipeline could for example satisfy this requirement by indicating its changes in the transmittal letter or attaching to the transmittal letter a redline-strikeout version of the tariff being revised.

    38The NOPR used the phrase “revisions that are marked appropriately,” which in the context of the oil pipeline regulations might be read to connote marked with the correct symbol. We are revising the regulation to read “revisions to tariffs identified in the filing” which will cover revisions that are explained in the transmittal letter even if the symbol is incorrect or omitted in the tariff.

    57. Section 6(3) of the Interstate Commerce Act (ICA) recognizes that it is the responsibility of an oil pipeline in making a filing to change its tariff to “plainly state the changes proposed to be made in the schedule then in force.”ICCv.American Trucking Association, 39 cited by AOPL, does not establish the invalidity of the Commission's regulation. InAmerican Trucking, the Interstate Commerce Commission (ICC) sought to reject tariff rates based on violations of rate bureau agreements. While the Court found that the ICC was without statutory authority retroactively to reject a tariff in violation of the rate bureau agreement after the tariff has taken effect, the Court found that the ICC did have authority to condition tariff approval in a manner reasonably tied to statutory objectives. In this regulation, we are not retroactively rejecting a tariff we have previously accepted; rather we are imposing a regulatory condition governing the filing prior to acceptance that will ensure that customers are protected in the event that the oil pipeline fails to provide sufficient notice of a tariff change. Moreover, the regulation does not determine the regulatory outcome of any challenge to the unidentified rate. We recognize the regulatory differences between the ICA and the FPA and NGA,40 and that interpretations of the ICA have provided that, in some circumstances, the failure to identify a rate change could be deemed a technical defect that would not necessarily void an unidentified rate, but could subject the pipeline to damages or other remedies as provided in the ICA.41

    39467 U.S. 354 (1984) (American Trucking).

    40The ICA for example provides a two-year period for reparations, which is not part of the NGA or FPA. 49 App. U.S.C. 16(3)(b) (1988).

    41 See Genstarv.ICC,665 F.2d 1304, 1308 (D.C. Cir. 1981) (for rates with procedural irregularities, the remedy is correction of the “harm if any caused by unlawfulness or irregularity”). For example, a shipper that does not have effective notice, may not be able to protest the filed rate and may only be aware of, and challenge, a rate after it has received a bill. After such a challenge is filed, the Commission could review the rate to determine if it is just and reasonable. If the Commission were to determine that the filed rate is not just and reasonable, but that a different rate is justified, the damages could be computed based on the difference between what the pipeline charged and the just and reasonable rate ultimately determined by the Commission.

    5. Clean Tariff Sheets Filed as Attachments

    58. As discussed above, the tariff text for use by the database will be filed as a separate data element, and the Commission may not be able to generate a formatted version of that tariff text acceptable to the filer for inclusion in eLibrary. For this reason, the standards provide that companies will also include as an attachment to their filing a clean copy of the relevant tariff sheets, sections, or entire document formatted