[Federal Register: June 29, 2007 (Volume 72, Number 125)]
[Proposed Rules]
[Page 35669-35672]
[DOCID:fr29jn07-21]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 157

[Docket No. RM07-17-000]

Revisions to Landowner Notification and Blanket Certificate
Regulations

June 22, 2007.
AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Notice of proposed rulemaking.

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SUMMARY: On October 19, 2006, the Federal Energy Regulatory Commission
(Commission) issued a Final Rule amending its regulations to expand the
scope and scale of activities that may be undertaken pursuant to
blanket certificate authority and clarifying that existing Commission
policies permit natural gas companies to charge different rates to
different classes of customers.\1\ The Commission proposes to further
amend its regulations to modify the landowner notification requirements
and require a noise survey following the completion of projects
involving compressor facilities undertaken pursuant to blanket
certificate authority. The proposed regulatory revisions should enhance
public participation in the Commission's consideration of proposed
projects and ensure that compressor projects completed under blanket
certificate authority will not have a significant adverse environmental
impact.
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    \1\ Order No. 686, 71 FR 63680 (October 31, 2006), FERC Stats &
Regs ] 31,231 (2006); Notice of Proposed Rulemaking (NOPR) 71 FR
36276 (June 26, 2006), FERC Stats. & Regs. ] 32,606 (2006). An order
on rehearing and clarification of the Final Rule in Docket No. RM06-
7-001 is issued contemporaneously with this NOPR. 119 FERC ] 61,303
(2007).

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DATES: Comments are due July 30, 2007.

ADDRESSES: You may submit comments, identified by Docket No. RM07-17-
000, by one of the following methods:
    Agency Web site: http://ferc.gov. Follow the instructions for

submitting comments via the eFiling link found in the Comment
Procedures section of the Preamble.
    Mail: Commenters unable to file comments electronically must mail
or hand deliver an original and 14 copies of their comments to: Federal
Energy Regulatory Commission, Office of the Secretary, 888 First
Street, NE., Washington, DC 20426. Refer to the Comment Procedures
section of the preamble for additional information on how to file paper
comments.

FOR FURTHER INFORMATION CONTACT: Gordon Wagner, Office of the General
Counsel, Federal Energy Regulatory Commission, 888 First Street, NE.,
Washington, DC 20426<EMAIL_ADDRESS>(202) 502-8947.
    Michael McGehee, Office of Energy Projects, Federal Energy
Regulatory Commission, 888 First Street, NE., Washington, DC 20426,
<EMAIL_ADDRESS>(202) 502-8962.

    Lonnie Lister, Office of Energy Projects, Federal Energy Regulatory
Commission, 888 First Street, NE., Washington, DC 20426,
<EMAIL_ADDRESS>(202) 502-8587.

SUPPLEMENTARY INFORMATION:

I. Introduction

    1. On October 19, 2006, the Federal Energy Regulatory Commission
(Commission) issued a Final Rule amending its Part 157, Subpart F,
regulations to expand the scope and scale of activities that may be
undertaken pursuant to blanket certificate authority and clarifying
that existing Commission policies permit natural gas companies to
charge different rates to different classes of customers.\2\ The
Commission proposes to further amend its Part 157 regulations to modify
the landowner notification requirements and require a noise survey
following the completion of projects involving compressor facilities
undertaken pursuant to blanket certificate authority. The proposed
regulatory revisions are expected to enhance public participation in
the Commission's consideration of proposed projects and ensure that
compressor projects completed under blanket certificate authority will
not have a significant adverse environmental impact.
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    \2\ Order No. 686, 71 FR 63680 (October 31, 2006), FERC Stats &
Regs ] 31,231 (2006); Notice of Proposed Rulemaking (NOPR) 71 FR
36276 (June 26, 2006), FERC Stats. & Regs. ] 32,606 (2006). An order
on rehearing and clarification of the Final Rule in Docket No. RM06-
7-000 is issued contemporaneously with this NOPR. 119 FERC ] 61,303
(2007).
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II. Background

    2. The blanket certificate program relies on the presumption that
any project permitted under blanket certificate authority will not have
a significant adverse environmental impact. The Commission ensures that
this is the case by restricting blanket certificate authority to
certain types of facilities and to individual projects that can comply
with a cost cap and the environmental requirements specified in Sec.
157.206(b). Prior to the Final Rule's increase in the per project cost
cap \3\ and the expansion of blanket certificate authority to cover
compressor facilities that alter mainline capacity, blanket certificate
authority was restricted to a limited set of compression facilities,
e.g., compressors on lateral pipelines, compressors installed
temporarily, replacement compressors that could not qualify under Sec.
2.55(b), and compressors needed to restore service lost due to sudden
unforeseen damage to a mainline.
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    \3\ The Final Rule increased the blanket certificate project
cost limits from $8,200,000 to $9,600,000 for automatic
authorization projects and from $22,700,000 to $27,400,000 for prior
notice projects.
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    3. A compressor project under the blanket certificate program is
not subject to the same scrutiny and procedural safeguards that apply
to a compressor project subject to case-specific NGA section 7
certificate authority. This is most pronounced with respect to a
project that qualifies for automatic authorization under the blanket
certificate regulations, in which case the Commission may remain
unaware of the project's construction until a company submits an annual
report of projects completed under automatic blanket certificate
authority pursuant to Sec.  157.207. Thus, in contrast to a proposal
for case-specific certificate authority, for a project subject to
blanket certificate authority, the Commission and public are not
assured the same opportunity to assess aspects of the project such as
what constitutes a noise sensitive area (NSA),\4\ the prospective uses
of property proximate to a compressor facility, habitat impacts on non-
residential areas, whether a particular area has a heightened noise
sensitivity that would merit a limit of less than 55 decibels (dBA), or
the cumulative impacts resulting from modifying or expanding existing
compressor facilities.
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    \4\ In the case of a blanket certificate compressor project, the
blanket certificate holder, rather than the Commission, determines
what constitutes a potentially affected NSA.
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    4. As a result, whereas an individual assessment can be undertaken
for each proposed case-specific compressor project in order to
establish a noise level appropriate to the particular site, this is not
the case for blanket certificate compressor projects. The more cursory
standard of review necessary to expedite projects under the blanket
certificate program, in conjunction with the expansion of the blanket
certificate program, prompted the Commission to impose a stricter
standard on the noise produced by blanket certificate compressor
facilities. As proposed in

the NOPR and implemented in the Final Rule,\5\ the Commission stated
that going forward, all compressor facilities constructed pursuant to
blanket certificate authority must meet the standard day-night level
(Ldn) limit of 55 dBA at the boundary of the compressor
site. However, as discussed in the order on rehearing of the Final Rule
issued contemporaneously with this NOPR,\6\ the Commission is returning
to the noise limit in place prior to the Final Rule, which requires
that compressor facilities installed under blanket certificate
authority be no louder than an Ldn of 55 dBA at any existing
pre-existing NSA.
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    \5\ The revised blanket certificate regulations became effective
on January 2, 2007.
    \6\ See note 1.
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III. Proposed Regulatory Revisions

A. Landowner Notification

    5. Currently, a natural gas company that seeks to undertake a
compressor project must notify all landowners with a residence within
one-half mile of proposed compressors or their enclosures.\7\ The
Commission is concerned that this existing landowner notification
requirement fails to capture all potentially affected landowners,
because a compressor project could go forward without any notification
to nearby landowners without a residence on their property. To
guarantee that land use issues--including existing non-residential uses
as well as future uses of undeveloped land--are adequately considered,
the Commission proposes to revise Sec.  157.6(d)(2)(iii), which defines
``affected landowners'' as: Owners of property interests, as noted in
the most recent county/city tax records as receiving the tax notice,
whose property, ``[c]ontains a residence within one-half mile of
proposed compressors or their enclosures.'' The Commission proposes to
omit the qualification that the property contain a residence to ensure
that all landowners within one-half mile of a compressor site receive
notice prior to construction, regardless of whether there is a
residence on their property, and regardless of whether construction is
undertaken pursuant to blanket or case-specific certificate
authorization.\8\
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    \7\ See the landowner notification requirements, 18 CFR
157.203(d)(1) and (2), and the definition of affected landowners, 18
CFR 157.6(d)(2)(iii).
    \8\ This proposed revision of the 18 CFR 157.6(d)(2)(iii)
notification condition will also apply to landowners within one-half
mile of liquefied natural gas (LNG) facilities.
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B. Noise Survey

    6. To verify compliance with the compressor noise limit, the
Commission proposes to add a new Sec.  157.206(b)(5)(ii) that will
require a company installing compressor facilities under blanket
certificate authority to submit a noise survey within 60 days of
placing new facilities in service to demonstrate that noise
attributable to the operation of the company's new compressor
facilities does not exceed an Ldn of 55 dBA at any
preexisting NSA.\9\ A noise survey measures the noise at selected
locations to quantify the existing noise environment by using a sound
level meter, a dosimeter, or an integrating sound level meter over a
specified timeframe.
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    \9\ The existing 18 CFR 157.206(b)(5)(ii) describing noise
attributable to drilling activities will remain unchanged, but will
be redesignated as 18 CFR 157.206(b)(5)(iii).
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    7. The Commission concludes the above-described procedural
modifications are necessary and sufficient to retain the expedited
authorization available for blanket certificate projects while
guaranteeing that compressor activities subject to the expanded blanket
certificate program will not have significant adverse environmental
impacts.\10\ The Commission invites comments on these proposed
regulatory revisions.
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    \10\ Currently, companies must conduct and submit a noise survey
for compressor projects completed under case-specific certificate
authority. The proposed new 18 CFR 157.206(b)(5)(ii) would extend
this same requirement to compressor projects completed under blanket
certificate authority. Note that in the order on rehearing in Docket
No. RM06-7-001 the Commission similarly seeks to harmonize
requirements that apply to case-specific and blanket certificate
compressor projects. See note 1.
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IV. Information Collection Statement

    8. The Office of Management and Budget (OMB) regulations require
that OMB approve certain reporting, record keeping, and public
disclosure requirements (collections of information) imposed by an
agency.\11\ Therefore, the Commission is providing notice of its
proposed information collections to OMB for review in accordance with
section 3507(d) of the Paperwork Reduction Act of 1995.\12\ Upon
approval of a collection of information, OMB will assign an OMB control
number and an expiration date. The only entities affected by this rule
would be the natural gas companies under the Commission's jurisdiction.
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    \11\ 5 CFR 1320.11.
    \12\ 44 U.S.C. 3507(d).
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    9. FERC-537, ``Gas Pipeline Certificates: Construction, Acquisition
and Abandonment,'' identifies the Commission's information collections
relating to Part 157 of its regulations, which apply to natural gas
facilities for which authorization under NGA section 7 is required, and
includes all blanket certificate projects.
    10. The proposed revisions to the Commission's regulations, as
contained in the NOPR, and the resulting change in collections of
information burdens, are as follows. Natural gas companies seeking to
construct, add to, or modify compressor or LNG facilities must provide
notice to all landowners within one-half mile of the boundary of the
project site. Currently, gas companies undertaking such activities are
required to provide notice to landowners within one-half mile of the
boundary of the project site only if there is a residence on their
property.
    11. This proposed revision should have little impact on companies'
notice procedures. Currently, companies are compelled to identify all
landowners of record within one-half mile of the project site, and then
notify the subset of landowners with a residence on their property. In
addition, as applicable, a company is also required to provide the
names and addresses of affected landowners to the Commission as part of
Resource Report 1--General Project Description.\13\ Extending the
notice requirement to all landowners should require a nominal
additional effort. In fact, it may be the case that distinguishing
properties with residences from those without is more burdensome than
simply notifying all identified landowners. In view of this, the
Commission expects the time and cost to notify non-residential
landowners will prove to be de minimis.
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    \13\ See 18 CFR 380, Appendix A.
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    12. The Noise Control Act of 1972 established the requirement that
all federal agencies administer their programs to promote an
environment free of noise that jeopardizes public health and
welfare.\14\ In 1974, the U.S. Environmental Protection Agency, acting
to execute its responsibility to coordinate federal research and
activities related to noise control, identified an Ldn of 55
dBA as necessary to protect against speech interference and sleep
disturbance for residential, educational, and healthcare NSAs.
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    \14\ 42 U.S.C. 4901, et seq.
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    13. The Commission proposes that a company installing compressor
facilities under blanket certificate authority submit a noise survey
within 60 days of placing new facilities in service to demonstrate that
the noise attributable to the operation of the company's compressors
does not exceed an Ldn of 55 dBA at pre-existing NSAs. The
Commission does not view this proposal as substantially modifying
natural gas companies' existing obligations, since

the proposed submission of a noise survey simply provides verification
of compliance with the existing noise requirement. This proposed noise
survey requirement already applies to compressor projects subject to
case-specific NGA section 7 certificate authority.\15\
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    \15\ The potential cost savings to the industry that may be
realized by enabling projects previously permitted only under case-
specific authority to proceed under the expanded blanket certificate
program were discussed in the Final Rule. With respect to the
proposed noise survey, the Commission notes that case-specific
projects require a noise survey both before and after construction.
Thus, to some extent, the relatively minor cost of conducting a
post-construction noise survey for a blanket certificate project
will be offset by the benefit of not having to also conduct a noise
survey before construction, as would be necessary for a case-
specific certificate project.
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    14. The Commission estimates it will require 32 hours to complete a
noise survey, and expects the aggregate impact of the proposal to be
modest, given that in 2006, two blanket certificate compressor projects
were completed. For the purpose of estimating burden hours, the
Commission anticipates five such projects in the future.

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                                                                  Number of
               Data collection                   Number of        responses/    Number of hours    Total annual
                                                respondents        filings       per  response        hours
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FERC-537 (Part 157).........................               5                5               32              160
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    Information Collection Costs: The above reflects the total
reporting burden associated with the proposed broadening of the
landowner notification requirement. Because of the regional differences
and the various staffing levels that will be involved in preparing the
documentation (legal, technical, and support) the Commission is using
an hourly rate of $150 to estimate the costs for filing and other
administrative processes (reviewing instructions, searching data
sources, completing and transmitting the collection of information).
The estimated cost is anticipated to be $3,360 per project, for a total
of $24,000.
    Title: FERC-537.
    Action: Proposed Data Collection.
    OMB Control Nos.: 1902-0060 and 1902-0128.
    Respondents: Natural gas pipeline companies.
    Frequency of Responses: On occasion.
    Necessity of Information: Submission of the information is
necessary for the Commission to carry out its NGA statutory
responsibilities and meet the Commission's objectives of expediting
appropriate infrastructure development to ensure sufficient energy
supplies while addressing landowner and environmental concerns fairly.
    15. The Commission requests comments on the accuracy of the burden
estimates, how the quality, quantity, and clarity of the information to
be collected might be enhanced, and any suggested methods for
minimizing the respondent's burden. Interested persons may obtain
information on the reporting requirements or submit comments by
contacting the Federal Energy Regulatory Commission, 888 First Street,
NE., Washington, DC 20426 (Attention: Michael Miller, Office of the
Executive Director,<PHONE_NUMBER> or e-mail michael.miller@ferc.gov).
Comments may also be sent to the Office of Management and Budget
(Attention: Desk Officer for the Federal Energy Regulatory Commission,
fax:<PHONE_NUMBER> or e-mail: oira_submission@omb.eop.gov).

V. Environmental Analysis

    16. The Commission is required to prepare an Environmental
Assessment (EA) or an Environmental Impact Statement (EIS) for any
action that may have a significant adverse effect on the human
environment.\16\ In promulgating the blanket certificate program in
1982, the Commission prepared an EA in which it determined that,
subject to compliance with the standard environmental conditions,
projects under the blanket program would not have a significant
environmental impact. As a result, the Commission determined that
automatic authorization projects would be categorically excluded from
the need for an EA or EIS under Sec.  380.4 of the Commission's
regulations. However, the Commission specified that prior notice
projects should be subject to an environmental review to ensure each
individual project would be environmentally benign, a requirement
applicable to compression projects that would expand mainline capacity
newly permitted under blanket certificate authority as a result of the
Final Rule.
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    \16\ Order No. 486, Regulations Implementing the National
Environmental Policy Act, 52 FR 47897 (Dec. 17, 1987), FERC Stats. &
Regs., Regulations Preambles 1986-1990 ] 30,783 (1987).
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    17. As discussed herein, the Commission is proposing to expand
landowner notification and require the submission of a post-project
noise survey for blanket certificate activities involving compressor
facilities. Therefore, this proposed rule does not constitute a major
federal action that may have a significant adverse effect on the human
environment.

VI. Regulatory Flexibility Act Analysis

    18. The Regulatory Flexibility Act of 1980 (RFA) \17\ generally
requires a description and analysis of proposed regulations that will
have significant economic impact on a substantial number of small
entities. The Commission is not required to make such an analysis if
proposed regulations would not have such an effect.\18\ Under the
industry standards used for purposes of the RFA, a natural gas pipeline
company qualifies as ``a small entity'' if it has annual revenues of
$6.5 million or less. Most companies regulated by the Commission do not
fall within the RFA's definition of a small entity.\19\
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    \17\ 5 U.S.C. 601-612.
    \18\ 5 U.S.C. 605(b) (2000).
    \19\ 5 U.S.C. 601(3), citing to section 3 of the Small Business
Act, 15 U.S.C. 623 (2000). Section 3 of the Small Business Act
defines a ``small-business concern'' as a business which is
independently owned and operated and which is not dominant in its
field of operation.
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    19. The procedural modifications proposed herein should have no
significant economic impact on those entities--be they large or small--
subject to the Commission's regulatory jurisdiction under NGA section 3
or 7, and no significant economic impact on state agencies.
Accordingly, the Commission certifies that these proposed regulations,
if promulgated, will not have a significant economic impact on a
substantial number of small entities.

VII. Public Comments

    20. 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 by July 30, 2007. Comments must refer to
Docket No. RM07-17-000, and must include the commenter's name and
address, and if applicable, the organization represented. Comments may
be filed either in electronic or paper format. The

Commission encourages electronic filing.
    21. Comments may 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 and requests commenters
to submit comments in a text-searchable format rather than a scanned
image format. Commenters filing electronically do not need to make a
paper filing. Commenters unable to file comments electronically must
send an original and 14 copies of their comments to: Federal Energy
Regulatory Commission, Office of the Secretary, 888 First Street, NE.,
Washington, DC 20426.
    22. 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.

VIII. Document Availability

    23. 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 print the contents of this document via the
Internet through FERC's Web site (http://www.ferc.gov) and in FERC's

Public Reference Room during normal business hours (8:30 a.m. to 5 p.m.
Eastern time) at 888 First Street, NE., Room 2A, Washington, DC 20426.
User assistance is available for FERC's Web site during normal business
hours from FERC's Online Support at<PHONE_NUMBER>, toll free at 1-866-
208-3676, or by e-mail at<EMAIL_ADDRESS>and from the
Public Reference Room at<PHONE_NUMBER>, TTY at<PHONE_NUMBER>, or by e-
mail at<EMAIL_ADDRESS>
List of Subjects in 18 CFR Part 157

    Administrative practice and procedure, Natural gas, Reporting and
recordkeeping requirements.

    By direction of the Commission.
Kimberly D. Bose,
Secretary.

    In consideration of the foregoing, the Commission proposes to amend
part 157, Chapter I, Title 18, Code of Federal Regulations, as follows:

PART 157--APPLICATIONS FOR CERTIFICATES OF PUBLIC CONVENIENCE AND
NECESSITY AND FOR ORDERS PERMITTING AND APPROVING ABANDONMENT UNDER
SECTION 7 OF THE NATURAL GAS ACT

    1. The authority citation for part 157 continues to read as
follows:

    Authority: 15 U.S.C. 717-717w.

    2. In Sec.  157.6, paragraph (d)(2)(iii) is revised to read as
follows:

Sec.  157.6  Applications; general requirements.

* * * * *
    (d) * * *
    (2) * * *
    (iii) Is within one-half mile of proposed compressors or their
enclosures or LNG facilities; or
* * * * *
    3. In Sec.  157.206, paragraph (b)(5)(ii) is redesignated as
paragraph (b)(5)(iii) and a new paragraph (b)(5)(ii) is added, to read
as follows:

Sec.  157.206  Standard conditions.

* * * * *
    (b) * * *
    (5) * * *
    (ii) For each new compressor station, compressor addition, or
modification to an existing compressor, the blanket certificate holder
must file a noise survey with the Secretary no later than 60 days after
the activity is complete and the compressor facility is placed in
service. If the noise attributable to the operation of the facility at
full load exceeds an Ldn of 55 dBA at any nearby noise-
sensitive areas, the blanket certificate holder shall file a report on
what changes are needed and must put in place additional noise controls
to meet the 55 dBA level within 1 year of the in-service date. The
blanket certificate holder must confirm compliance with this
requirement by filing a subsequent noise survey with the Secretary no
later than 60 days after installation of the additional noise controls.
* * * * *
[FR Doc. E7-12557 Filed 6-28-07; 8:45 am]

BILLING CODE 6717-01-P