Daily Rules, Proposed Rules, and Notices of the Federal Government
1. In this Final Rule, the Commission amends the instructions on page 700, Annual Cost of Service Based Analysis Schedule, of FERC Form No. 6, Annual Report of Oil Pipeline Companies, (Form 6) to ensure that oil pipelines report interstate-only barrel and barrel-mile data on lines (11) and (12) of page 700 and not a combination of interstate and intrastate throughput.
2. Page 700 of Form 6 serves as a preliminary screening tool for shippers to evaluate interstate pipeline rates subject to the Commission's jurisdiction.
3. On July 29, 2011, the Commission issued a Notice of Proposed Rulemaking (NOPR)
4. In addition to modifying the instructions for the page 700, the NOPR further proposed to require any pipeline that reported combined interstate and intrastate data in lines (1) through (12) on page 700 to file a revised page 700 of the 2010 Form 6 containing interstate-only data for 2009 and 2010.
5. On April 18, 2012, following the issuance of the NOPR and after the filing of comments in this proceeding, pipelines filed the 2011 Form 6, which contains page 700 data for 2011 and 2010.
6. Comments on the NOPR were due on October 3, 2011. Comments were filed by Valero Marketing and Supply Company (Valero); Air Transport Association of America and the National Propane Gas Association (ATA/NPGA); Magellan Pipeline, L.P. (Magellan); Association of Oil Pipelines (AOPL);
7. The NOPR proposed to modify the instructions for line (11) and line (12) of page 700 to specify that pipelines must report only interstate barrels and interstate barrel-miles and not a combination of interstate and intrastate throughput.
8. Valero, ATA/NPGA, and Mr. Gooch support the clarification that pipelines are to report on page 700 only interstate barrels and barrel-miles. They state that this change is consistent with the purpose of page 700. Magellan also states that it supports the proposal. AOPL and Enbridge state that they do not oppose the proposal to change the instructions on page 700.
9. The Commission adopts the proposal to clarify that the barrel and barrel-mile data reported on lines (11) and (12) of page 700 must include interstate-only data and may not comingle interstate and intrastate data. None of the parties oppose this change. This modification will ensure that the interstate-only revenues and costs currently required to be reported on page 700 are accompanied by interstate-only volumes.
10. The NOPR proposed that pipelines that reported combined interstate and intrastate data in lines (1) through (12) on page 700 should file a corrected 2010 Form 6 page 700 containing interstate only data for 2009 and 2010.
11. Valero, ATA/NPGA, and Mr. Gooch support requiring pipelines that included intrastate data in the page 700 on the 2010 Form 6 to file revised 2009 and 2010 data containing interstate-only information. In addition, Valero and ATA/NPGA request that the Commission require pipelines to re-file corrected page 700 going back to the 2005 Form 6. Valero, ATA/NPGA, and Mr. Gooch state that once the Commission has gathered the page 700 information, it should then re-evaluate the appropriateness of the current oil pipeline index
12. In contrast, AOPL, Magellan, and Enbridge oppose requiring any pipeline
13. Additionally, AOPL and Magellan dispute the NOPR's estimate that re-filing 2009 and 2010 data will only be one hour per filer. AOPL contends that it can be difficult to determine whether a movement is interstate or intrastate. Similarly, Magellan states that until the most recent 2010 Form 6 filed on April 18, 2011, Magellan filed comingled interstate and intrastate throughput and operating cost data on its page 700. Based upon its own experience, Magellan estimates that revisions to 2009 data for other pipelines would require forty man-hours over a three-week period involving multiple personnel.
14. In its reply comments, AOPL asserts that Valero, ATA/NPGA, and Mr. Gooch's proposal to require re-filing of page 700 data going back the 2005 Form 6 is an improper collateral attack on the Commission's decisions in the 2010 Five-Year Index Review. AOPL adds that if the Commission considers using page 700 to calculate the index in the future, the Commission must address the objections that were raised in the last five-year review.
15. Also in its reply comments, AOPL reiterates its position that the request for corrected 2009 data has not been justified. AOPL contends that the burden of recalculating the 2010 Form 6, page 700 data substantially exceeds the one hour per filer estimated by the NOPR. AOPL states that sorting out the jurisdictional status of individual pipeline movements and recalculating the correct number of barrels and barrel-miles to each destination can be quite time consuming. Responding to Valero, ATA/NPGA, and Mr. Gooch, AOPL states that the further back in time the recalculation is required, the more difficult the data is to reconstruct. AOPL adds that there have been significant changes in pipeline ownership and operations since 2005, making it more difficult to reconstruct historic data.
16. In its reply comments, Valero denies that its request is a collateral attack on the 2010 Five-Year Index Review. Valero emphasizes the importance of the index level for shipper costs. Citing the NOPR's estimate of a total cost of $11,362.70 to correct the referenced reporting errors for the years 2009 and 2010, Valero asserts that requiring pipelines to file corrected data for 2006, 2007, and 2008 would cost $35,000. Valero disputes AOPL's and Magellan's claims regarding burden of filing revised interstate-only page 700 information. Valero observes that only one pipeline (Magellan) raised objections to the Commission's burden estimate. Valero states that pipelines such as Magellan already report intrastate and interstate revenue on page 301 of the Form 6. Thus, Valero concludes that pipelines should be fully aware of the corresponding interstate and intrastate movements, barrels, and barrel-miles, underlying these reported revenue amounts. Valero notes that pipelines are already required to report interstate-only data for lines (1) through (10).
17. In the NOPR, the Commission proposed to require any pipeline that reported comingled interstate and intrastate data on lines (1) through (12) of the 2010 Form 6, page 700 to file revised 2010 Form 6, page 700 data for the years 2010 and 2009. In addition, following the issuance of the NOPR and after the filing of comments, pipelines filed the 2011 Form 6 on April 18, 2012, which contains page 700 data for 2011 and 2010.
18. Accordingly, the Commission directs any pipeline that reported combined interstate and intrastate data in any field on lines (1) through (12) of page 700 of its 2010 Form 6 or page 700 of its 2011 Form 6 to file revised page 700 data containing only interstate data for the years 2009, 2010 and 2011.
19. This action ensures the availability of complete interstate cost per barrel-mile data consistent with the Commission's regulation of interstate oil pipeline rates and the intent of page 700 to enable the Commission and shippers to analyze interstate pipeline costs. For example, the interstate-only information for the year 2009, 2010 and 2011 will provide the Commission with useful information during the next five-year review of the Commission's index level.
20. The Commission will not require pipelines to file revised page 700 data for the years prior to 2009. The sole purpose given by Valero, ATA/NPGA, and Mr. Gooch for requesting this information is to reconsider the conclusions of the Commission's 2010 Five-Year Index Review. The proposal to revisit the indexing calculation is a collateral attack on the recently completed 2010 Five-Year Index Review, which has been administratively final as of the Commission's order on rehearing.
21. In response to AOPL, Magellan, and Enbridge, the Commission does not view the re-filing requirement for the
The Commission never intended in the Final Rule to have a pipeline report its non-jurisdictional costs on page 700.* * * [W]e take this opportunity to clarify Order No. 620 that the cost-of-service and revenue data reported on page 700 will be the cost of service and revenues related to FERC jurisdictional services.
94 FERC at 61,498.
22. Regarding the barrel and barrel-mile data on lines (11) and (12), Magellan and AOPL contend that it is sometimes difficult to determine whether a shipment is interstate or intrastate. However, compliance with the existing requirement for pipelines to file only interstate costs and revenues on lines (1) through (10) requires a similar determination distinguishing between interstate shipments and intrastate shipments.
23. Magellan requests that the Commission permit flexibility in the methodology that pipelines adopt for allocating intrastate and interstate cost data in page 700. Magellan asserts that it is not possible to precisely segregate interstate cost data from intrastate cost data in all instances. Thus, Magellan asserts that a dual use pipeline will need to develop its own methodology for allocating such costs. Magellan states that prior to the Form No. 6 it filed in 2010, Magellan included both interstate and intrastate data on page 700. Magellan states that to do so, it developed and adopted a methodology to allocate operating expenses between interstate and intrastate movements based upon a barrel-mile analysis. Thus, Magellan states that it used this methodology to allocate operating expenses between interstate and intrastate movements on a barrel-mile basis.
24. The Commission will deny Magellan's request. We will not pass judgment in this proceeding on past or future page 700 submissions or the methodologies used to separate interstate from intrastate. The purpose of this order is to modify the instructions for lines (11) and (12) of page 700 related to reporting barrels and barrel-miles of throughput. In filing page 700, pipelines are required to follow the Commission's cost-of-service methodology. Magellan's request for clarification is further inapposite because the Commission clarified a decade ago in Order No. 620-A
25. The parties raised multiple issues related to other aspects of page 700 or Form 6. Valero and ATA/NPGA contend that revisions should be made to page 700 so that each pipeline and/or system is separately reported on page 700.
26. Parties also raised issues not involving Form 6. ATA/NPGA further asserts that the Commission should change the interest rate applicable to refunds and reparations. ATA/NPGA and Mr. Gooch also raise issues related to alleged over-recoveries by certain pipelines. ATA/NPGA and Mr. Gooch argue that pipelines showing over-recoveries on their Form No. 6 annual report should be required to show cause why their rates should not be considered unjust and unreasonable. Mr. Gooch also objects to the Commission's regulations and policies regarding protests and complaints against oil pipeline rates. Valero asserts that the Commission should clarify that shippers retain the right to challenge, via protest or complaint, the 2011 index rate increases for pipelines that have filed deficient cost and revenue data on page 700. Mr. Gooch also asks that the Commission clarify precisely how barrel-miles may be used to demonstrate reasonable grounds to believe that the rate increase is “substantially divergent” from the costs so that the resulting rates may not be just and reasonable.
27. In its reply comments, AOPL states that these comments are beyond the scope. AOPL adds that the Shippers have repeatedly raised and the Commission has repeatedly rejected (a) proposals to segregate Form 6 and page 700 data by pipeline system and (b) require pipelines to file their page 700 workpapers with the Form 6.
28. In his reply comments, Mr. Gooch contends that his comments are not beyond the scope because, he argues, they are a constitutionally protected petition for a redress of grievances. Mr. Gooch also reiterates his comments regarding alleged over-recoveries by certain pipelines and asserts that it is difficult to file complaints.
29. These issues are beyond the scope of this proceeding, which is limited to a minor correction to the throughput levels reported on page 700 and obtaining corrected data for 2009, 2010, and 2011. No party opposed the limited change to page 700 that was actually
30. The Commission's estimate of the additional Public Reporting Burden and cost related to the final rule in Docket RM11-21-000 follow. The Commission recognizes that there will be a one-time increased burden involved in the initial implementation associated with: (a) Using only interstate figures for lines 1-12 of page 700, and (b) re-filing of revised data for lines (1) through (12) of page 700 for 2009, 2010, and 2011. Given the time it takes to verify data and file it with the Commission, we may have underestimated the one hour average per filer. Consequently we have revised the average burden to four hours for filing corrected 2009 and 2010 page 700 data. In this final rule, the Commission is also seeking revised 2011 data. Thus, we estimate an additional one-time burden of six hours per filer for the combined implementation and the re-filing of the page 700 for the 2009, 2010, and 2011 data. For the recurring effort involved in filing interstate data on lines (1) through (12) of page 700 for 2012 and future years, we estimate that the change in burden is negligible (after the initial implementation).
The additional one-time burden of 996 hours is being spread over the three years for the purposes of submittal to the Office of Management and Budget (OMB), giving
Total additional one-time cost = $68,733.96.
31. Interested persons may obtain information on the reporting requirements by contacting: Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426 [Attention: Ellen Brown, Office of the Executive Director, email:
32. 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.
33. The Regulatory Flexibility Act of 1980 (RFA) requires agencies to prepare certain statements, descriptions, and analyses of proposed rules that will have a significant economic impact on a substantial number of small entities.
34. The Commission does not believe that this rule will have an adverse impact on small entities, nor will it impose upon them any significant costs of compliance. The Commission identified 29 small entities as respondents to the requirements in the proposed rule.
35. These regulations are effective December 31, 2012. The Commission has determined, with the concurrence of the Administrator of the Office of Information and Regulatory Affairs of OMB, that this rule is not a “major rule” as defined in section 351 of the Small Business Regulatory Enforcement Fairness Act of 1996.
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By direction of the Commission.
Appendix A will not be published in the Code of Federal Regulations.
Enter on line 11, columns b and c, the interstate throughput in barrels for the current and previous calendar years.
Enter on line 12, columns b and c, the interstate throughput in barrel-miles for the current and previous calendar years.
Total Interstate Throughput in Barrels
Total Interstate Throughput in Barrel-Miles
Appendix B will not be published in the Code of Federal Regulations.