In re Revised Filing & Reporting Requirements For Interstate Nat. Gas Co. Rate Schedules & Tariffs
| Decision Date | 17 November 2022 |
| Docket Number | RM21-18-000 |
| Citation | 181 FERC ¶ 61, 121 |
| Parties | Revised Filing and Reporting Requirements for Interstate Natural Gas Company Rate Schedules and Tariffs |
| Court | Federal Energy Regulatory Commission |
181 FERC ¶ 61,121
Revised Filing and Reporting Requirements for Interstate Natural Gas Company Rate Schedules and Tariffs
No. RM21-18-000
United States of America, Federal Energy Regulatory Commission
November 17, 2022
18 CFR Parts 154, 260, & 284
Order No. 884
AGENCY: Federal Energy Regulatory Commission.
ACTION: Final rule.
SUMMARY: The Federal Energy Regulatory Commission issues this final rule to require natural gas pipelines to submit all supporting statements, schedules and workpapers in native format (e.g., Microsoft Excel) with all links and formulas included when filing a Natural Gas Act section 4 rate case.
DATES: This rule is effective [INSERT DATE 30 DAYS AFTER DATE OF PUBLICATION IN THE FEDERAL REGISTER]
Before Commissioners: Richard Glick, Chairman; James P. Danly, Allison Clements, Mark C. Christie, and Willie L. Phillips.
FINAL RULE
1. In this final rule, the Federal Energy Regulatory Commission (Commission) revises the filing and reporting requirements for natural gas pipelines filing a Natural Gas Act (NGA) section 4 rate case.[1] As discussed below, we adopt the Commission's proposal pursuant to the Notice of Proposed Rulemaking (NOPR) issued on May 19, 2022,[2] to establish a rule to require natural gas pipelines to submit all supporting statements, schedules and workpapers in native format (e.g., Microsoft Excel) with all links and formulas includ ed when filing an NGA section 4 rate case.
1. Background
2. When a natural gas pipeline files under NGA section 4 to change its rates, the Commission requires the pipeline to provide detailed support for all the components of its cost of service.[3]
3. Commission regulations require that natural gas pipelines filing general NGA section 4 rate cases provide certain statements (Statements A through P) and associated schedules.[4] In 1995, the Commission issued its Filing and Reporting Requirements for Interstate Natural Gas Company Rate Schedules and Tariffs (Order No. 582), stating that Statements I, J and a portion of H (containing state tax formulations) must be received in spreadsheet format with formulas includ ed, as the data provided in these statements and schedules are essential to understanding a natural gas pipeline's position with regard to cost allocation and rate design.[5] The Commission explained that although these spreadsheets could be obtained through discovery, that process is burdensome and inhibits better-informed comments.[6] Subsequently, the FERC Implementation Guide for Electronic Filing of Parts 35, 154, 284, 300 and 341 Tariff Filings
(FERC Implementation Guide) stated that the "submission of spreadsheets in native file format is preferred for Statements A through M, including related schedules. Statements O and P may use any electronic format that renders text, graphics, spreadsheets or data bases that the Commission accepts (the list of FERC Acceptable File Formats is available on http://www.ferc.gov)."[7]Furthermore, for Statements I, J and a portion of H, the FERC Implementation Guide stated that if spreadsheets in native format are not available, the natural gas pipeline may submit those statements using any of the aforementioned acceptable electronic formats that the Commission accepts.[8]
4. In the NOPR, the Commission proposed to require natural gas pipelines to submit all statements, schedules and workpapers in native format with formulas and links intact[9]when filing a general NGA section 4 rate case. As the Commission explained in the NOPR, requiring all statements, schedules and workpapers to be filed in native format will reconcile any ambiguity in the current requirements.[10] Moreover, the Commission explained that this requirement would address the information gap that currently exists
because, when a pipeline submits a section 4 rate case filing the Commission often cannot verify whether there were underlying links used to develop a spreadsheet or whether a pipeline severed those links before filing its rate case.[11] Furthermore, the Commission stated that requiring spreadsheets with links and formulas intact will enable rate case participants to manipulate the cost-of-service components (including billing determinants) to evaluate different rate outcomes without the need to create their own rate models, which will expedite settlement negotiations and allow all rate case participants to evaluate the filing on an equal footing.[12]
5. The Commission also stated that submitting all statements, schedules and workpapers in native format will provide for a timely and comprehensive analysis of a rate case filing.[13] All interested rate case participants will be able to evaluate the statements and schedules once they are filed, rather than needing to wait to obtain the information through discovery or to create their own rate models.
6. Finally, the Commission stated that the current policy on this issue is outdated because information technology has significantly improved since the issuance of Order No. 582 in 1995, and pipelines now routinely develop rate cases using Microsoft Excel and submit them electronically.[14]
7. The NOPR was published in the Federal Register on May 25, 2022[15] and established a comment date of June 24, 2022. The Commission received eight comments and two reply comments from a variety of stakeholders.[16] XES, National Grid and Exelon, generally support the Commission's proposal, while Energy Transfer, BHE GT&S, INGAA, Joint Commenters and Public Citizen, also generally support the proposal and request further clarifications.
II. Discussion
8. We adopt the proposal set forth in the NOPR to require natural gas pipelines to submit all supporting statements, schedules and workpapers in native format with all links and formulas includ ed when filing an NGA section 4 rate case. We acknowledge the requests from certain commenters that the Commission undertake various additional
initiatives, but we find that those requested initiatives go beyond the scope of this rulemaking, as explained below.
A. The Final Rule Imposes a Reasonable Burden on Pipelines
1. Comments
9. Energy Transf er argues that "the proposed rule takes the a d d it io n a l, unjust and unreasonable step of requiring a pipeline to create links and formulas in successive documents even if the pipeline did not need or use such links and formulas when it prepared and filed its rate case."[17] Energy Transfer states that "requiring a pipeline to specially create and file links or formulas it did not need or use to prepare and file its rate case is arbitrary and capricious and does not constitute reasoned decision-making because it would unreasonably shift litigation costs and burdens to interstate natural gas pipelines."[18] Energy Transfer further states that "such costs should be borne by the limited number of participants involved in rate case litigation that seek to analyze rates in specific detail to litigate their ind ivid ual rate issues."[19]
10. Joint Commenters disagree with Energy Transfer, arguing that the burden on pipelines would be limited because Order No. 582 already requires pipelines to provide data for certain statements with formulas included, and subsequent orders reiterate these
requirements.[20] Second, Joint Commenters argue that pipelines bear the burden of supporting a rate filing. Moreover, Joint Commenters point out that to the extent that pipelines incur additional costs related to complying with any new rule that the Commission issues, pipelines can seek to recover the costs in a rate proceeding, and therefore, the costs are not being shifted impermissibly to the pipelines.[21]
11. BHE GT&S requests that the Commission clarify that a natural gas pipeline is not required to create links across statements and schedules where they did not already exist. [22] BHE GT&S argues that it is not reasonable to require rate case participants to create links where none exist in the first instance.
a. Commission Determination
12. We disagree with Energy Transfer's argument that the NOPR proposal which we adopt in this final rule is unjust and unreasonable. First, we find that this final rule does not unreasonably shift litigation costs from intervenors to the pipeline. The pipeline has the burden under NGA section 4 to support its proposed rates in its case in chief.[23] This final rule merely requires pipelines to provide intact links and formulas in the workpapers and schedules that must be included in the case in chief.[24] This final rule does not require
pipelines to fund the litigation costs of other participants. Moreover, while pipelines may incur increased costs to comply with this final rule, we find that any additional burden would be limited, and pipelines are allowed to recover those costs through their rates.
13. Finally, we d eny BHE GT&S's request for clarif icat ion that a natural gas pipeline is not required to create links across statements and schedules where they did not already exist. Rather, this final rule does require natural gas pipelines to create links and formulas to show the pipeline's progressive calculations in the supporting statements, schedules and workpapers.
2. The Final Rule Properly Addresses the Information Gap Occurring When Formulas and Links are not Provided a. Comments
14. Energy Transfer, citing the NOPR, notes that the Commission "seek[s] to address this information gap and require natural gas pipelines to file statements and schedules linking progressive calculations regardless of how the statements and schedules were created."[25] Energy Transfer contends that the "Commission's proposal is based on a false premise because no so-called 'information gap' exists, and all the information and data are included in the pipeline's rate case filing."[26] Energy Transfer further argues that a pipeline may create an Excel file without certain links or...
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