SF 83 SUPPORTING STATEMENT ENVIRONMENTAL PROTECTION AGENCY RECORDKEEPING REQUIREMENTS FOR PRODUCERS OF PESTICIDES 40 CFR PART 169 1. Identification of the Information Collection 1( a) Title of the Information Collection Recordkeeping Requirements for Producers of Pesticides under section 8 of the Federal Insecticide, Fungicide, and Rodenticide Act as amended ( FIFRA). ICR Number 0143.08 1( b) Short Characterization/ Abstract FIFRA section 8 states that the Administrator of the Environmental Protection Agency may prescribe regulations requiring pesticide producers, registrants and applicants for registration to maintain such records with respect to their operations and the effective enforcement of this Act and to make such records available for inspection and copying as specified in the statute. The regulations at 40 CFR Part 169 ( Books and Records of Pesticide Production and Distribution) specify the following records that producers must keep and the disposition of those records.

Producers must maintain records on production data for pesticides, devices, or active ingredients ( including pesticides produced pursuant to an experimental use permit); receipt by the producer of pesticides, devices, or active ingredients used in producing pesticides; delivery, moving, or holding of pesticides; inventory; domestic advertising for restricted use pesticides; guarantees; exports; disposal; human testing; and tolerance petitions. Additionally, section 8 gives the Agency inspectional authority to monitor the validity of research data ( including raw data), developed in accordance with Good Laboratory Practice Standards, and used to support pesticide registration. These records generally consist of the material produced during the course of ordinary business activity, and are maintained in the location, manner, and duration as is generally prudent for such records in the course of ordinary business activity.

Respondents are required to maintain records of receipt, production, shipping, and inventory for two years. Records regarding testing of registered pesticides must be maintained for the life of the pesticide registration, as such data are necessary to support the regulatory decision.

Approximately 12,953 respondents are currently subject to this requirement, and it is estimated that no additional respondents per year will become subject to this requirement in the next three years. The cost of this ICR to the respondents is estimated to be $ 1,107,524. The estimate of number of respondents is based on the number of pesticide producers who have responded to the latest mandatory annual reporting response under FIFRA section 7, which defines the entire universe of legal producers of pesticides for sale or distribution in the United States. The estimated change is based on extrapolation from trends in the number of reported  2

producers over the last three years. The estimated cost per producer has been estimated to consist entirely of the cost of preparing records for inspection, as the recordkeeping itself consists of activities that are considered to be customary business practices.

2. Need for and Use of the Collection 2( a) Need/ Authority for the Collection FIFRA section 8( a) states that the Administrator may prescribe regulations requiring producers, registrants, and applicants for registration to maintain such records with respect to their operations and the pesticides and devices produced as the Administrator determines are necessary for the effective enforcement of [ FIFRA] and to make such records available for inspection and copying.

FIFRA section 12( a)( 2)( B)( i) provides that it is unlawful for any person to refuse to prepare, maintain, or submit any records required by or under section 8 of the Act.

2( b) PRACTICAL UTILITY/ USERS OF THE DATA EPA must be able to examine and copy records at pesticide producers demonstrating the identity, production, receipt, shipment, inventory, advertisement, and guarantees with respect to all domestically sold or distributed pesticides. This is necessary to determine that such products are in compliance with FIFRA and to support enforcement action against the products producers if they are not. EPA must be able to examine and copy records with respect to exported pesticides in order to determine that products that have been exported are in compliance with labeling and foreign purchaser specification and acknowledgment requirements, and to take support enforcement action against exporters who do not comply with FIFRA requirements. EPA must be able to examine records of pesticide disposal in order to protect public health and the environment should it be necessary to locate such disposal sites. EPA must be able to access records regarding testing on humans to protect the health and safety of such testing subjects should potential adverse effects become known. EPA must be able to access records regarding testing of registered pesticides to determine the integrity of such information, and the subsequent validity of regulatory decisions based on such information that allow the continued sale and distribution of specific pesticide products.

These data may be used by enforcement and compliance officers at the federal and state level, and by regulatory officials at the federal and state level.

3. Nonduplication, Consultations, and Other Collection Criteria 3( a) Nonduplication The records required to be maintained are normal business records and as such are only created upon the occurrence of a discrete activity. These records may be reproduced at the time  3

of an inspection but EPA does not require a producer to submit these records to the Agency. Since it applies to the original records, no duplication exists.

3( b) Public Notice Required Prior to ICR Submission to OMB An announcement of a public comment period for the renewal of this ICR was published in the Federal Register on March 31, 2004 ( 69 FR 16916).

3( c) Consultations EPA received three comments: two from pesticide producers and one from an association representing many industries affected by the ICR. One of two pesticide producers discussed the utility of production data reports. The other producer and the association both addressed the issue of allowing copies of records to serve as replacements for original records. The matter of production data reports is not relevant to this ICR, and that comment can not be responded to in this supporting statement. The other comments are relevant and are addressed below.

The producer and association commenting on the matter of record copies addressed the same issues. They both supported the need for Books and Records recordkeeping, but questioned the accuracy of burden estimates, and suggested that the quality, utility, and clarity of information records would be enhanced by allowing records to be copied, including in electronic format, rather than requiring original records to be maintained.

EPA has maintained since the inception of this ICR that all of the records required to be maintained by the relevant regulatory authority are generated and maintained by customary business practices. Although information management technologies have evolved since the regulations were written twenty four years ago ( reference: 45 FR 54388, August 15, 1980) the need to generate and maintain these records has not changed. EPA considers the information collection burden of this requirement to continue to consist solely of the need to review and understand the regulations.

EPA's extant regulation recognizes that the integrity of data records can be assured only through the retention of original records. Allowing replacement of records with copies would require revision of the regulation. This matter is dependent on separate government and agencywide determinations. It cannot be addressed in this ICR..

3( d) Effects of Less Frequent Collection Each record required relates to a separate, discrete business activity. Each record is generated only once in the course of each activity. It would not be possible to reduce the collection frequency without removing certain activities from compliance altogether.

3( e) General Guidelines  4

None of the reporting or recordkeeping requirements contained in 40 CFR Part 169 or otherwise pertinent to this request violate any of the regulations established by OMB in 5 CFR 1320.6.

3( f) Confidentiality The required information consists of emissions data and other information that have been determined not to be private. However, any information submitted to the agency for which a claim of confidentiality is made will be safeguarded according to the Agency policies set forth in Title 40, Chapter 1, Part 2, Subpart B  Confidentiality of Business Information ( see 40 CFR 2; 41 FR 36902, September 1, 1976; amended by 43 FR 40000, September 8, 1978; 43 FR 42251, September 20, 1978; 44 FR 17674, March 23, 1979).

3( g) Sensitive Questions None of the reporting or recordkeeping requirements contained in 40 CFR Part 169 or otherwise pertinent to this request contain sensitive questions.

4. The Respondents and the Information Requested 4( a) Respondents/ SIC Codes The three digit Standard Industrial Classification codes assigned to pesticide producers are 286 and 287.

4( b) INFORMATION REQUESTED ( i) Data Items All data in this ICR that is recorded is required by 40 CFR Part 169. Under this requirement producers of pesticides must maintain:

( A) In a current status:

 Inventory records with respect to types and amounts of pesticides and active ingredients or quantities of devices in stock. These records may be discarded when updated with more current records. ( 169.2( e))

( B) For one ( 1) year:

 copies of all guarantees given pursuant to section 12( a)( 2)( C) of the Act. ( 169.2( g))

( C) For two ( 2) years:  5

 Records showing the product name, EPA registration number, experimental use permit number, amounts per batch and batch identification numbers of pesticides produced.

 Records showing the brand names and quantities of pesticides produced. ( 169.2( b))

 Records showing the following information regarding receipt by the producer of pesticides, devices, and active ingredients: brand name of pesticide or device or common/ chemical name of active ingredient; name and address of shipper; name of delivering carrier; date received; and quantities received. ( 169.2( c))

 Records showing the following information regarding shipment by the producer of pesticides, devices, and active ingredients: brand name of pesticide or device or common/ chemical name of active ingredient; name and address of consignee; in the case of pesticides produced pursuant to sections 5, 18, or 24 of the Act, the information required under these sections and any regulations promulgated thereto regarding the distribution of such pesticides; name of originating carrier; date shipped or delivered for shipment; and quantities shipped or delivered for shipment. ( 169.2( d))

 Copies of all domestic advertising of the restricted uses of any restricted use pesticide that the producer caused to have prepared. ( 169.2( f))

 In the case of pesticides, devices, and active ingredients used in producing pesticides intended solely for export: copies of specifications or directions of the foreign purchaser for production of such pesticides, devices, and active ingredients; copies of labels or labeling required to comply with section 17( a)( 1) of the Act; and for any pesticide not registered under section 3 or sold under section 6( a)( 1) of the Act, a copy of the statement from the foreign purchaser acknowledging that the foreign purchaser is aware that the product is not registered in the United States and cannot be sold for use in the United States. ( 169.2( h))

( D) For twenty ( 20) years, or forwarded after three ( 3) years to EPA for maintenance:

 Records of the method of disposal, data or dates of disposal, location of disposal sites, and types and amounts of pesticides or pesticide active ingredients disposed of by the producer or contractor, deviations from normal practice, and records on disposal of pesticides, active ingredients, or containers specified pursuant to section 19 of the Act or regulations promulgated thereto. ( 169.2( i))

 Records of any tests conducted on human beings whether conducted by or paid for  6

by the producer, including: the names and addresses of subjects tested, dates and types of tests; written consent of subjects to test; instructions to subjects regarding purpose, nature, foreseeable health consequences of the tests; and any records of adverse effects either before or after the tests. ( 169.2( j))

( E) For as long as a registration is valid and the producer is in business:

 records containing research data relating to registered pesticides including data submitted to the EPA in support of a registration or tolerance petition, and all underlying raw data. ( 169.2( k))

This period of retention is necessary to allow the agency to evaluate the validity of data used to support pesticide registrations at any time during the period that the product is registered. Without these data the Agency would not be able to support its regulatory decision allowing the product to be registered.

( ii) Respondent Activities  Read instructions 40 CFR Part 169 regulations.

 Plan activities CBP  Gather information CBP  Plan and review information for accuracy CBP  Store, file, and maintain the information CBP CBP " Customary and Usual Business Practice"

During the course of normal and prudent business operations, a producer would plan his and his staff's information collection activities, arrange for the collection, review himself or have staff review the information for accuracy, and arrange to maintain or store the information detailed under 3( b). The information required to be kept is generally information that prudent businesses would maintain. The Agency does not specify in the regulation how the data to be gathered must be organized. Therefore, producers can continue to gather the required data in a manner consistent with their customary and usual business practices.  7

5. The Information Collected  Agency Activities, Collection Methodology, and Information Management 5( a) Agency Activities In this collection the Agency will: 1) answer producers' questions; 2) may audit or review data collected; 3) provide appropriate protection of confidential business information; and 4) store long term data, if requested.

5( b) Collection Methodology and Management Producers determine how best to comply with the requirements for recordkeeping under FIFRA section 8. They may collect and store the required data electronically. The Agency, through State, headquarters or EPA Regional inspectors, may periodically audit or review the data at sites chosen by individual producers. Other than review during periodic inspections, those records will generally not be submitted to the Agency unless the Agency requests them for a specific reason, such as a need to review research data supporting a registration or in the preparation of an enforcement case.

Those records pertaining to disposal of pesticide and human testing, which are required to be retained for 20 years, may be turned over to the Agency for storage after 3 years. The Agency then stores those records in the form in which they are submitted. If a producer submits section 8 records to the Agency, that portion of the records which are not classified as Confidential Business Information ( CBI) could be accessed by the public through the Freedom of Information Act.

5( c) Small Entity Flexibility The information collected under ICR # 0143 does not negatively impact small businesses, since the records required to be maintained are those which qualify as " customary and usual business activity." To the extent that larger businesses can use economies of scale to reduce their burden, the overall burden will be reduced. However, even though the recordkeeping and reporting requirements are the same for small and larger businesses, the Agency considers these requirements the minimum needed to ensure compliance and, therefore, cannot reduce them further for small businesses.

5( d) Collection Schedule There is no specified collection schedule. Production of records for Agency review occurs at the time of routine inspection, which occurs approximately every two to three years, or when a specific need arises to evaluate the compliance of a producer. For the purposes of estimation, this is assumed to be annual, which overstates the actual collection burden.  8

6. Estimating the Burden and Cost of the Collection The records that must be maintained for purposes of FIFRA section 8 are generally those that a responsible company would maintain as good business practice. It is estimated that the burden for a producer to prepare for the possibility of an on site EPA inspection of those records, is two hours per year. The burden is due, therefore, less to the actual recordkeeping requirement itself than to the burden placed upon the record keeper in locating and presenting these records to an inspector. While the actual burden that falls upon a company undergoing an inspection may be greater than the estimated two hours, a given company will undergo an inspection no more often than once every two to three years, if that frequently. EPA estimates that approximately one hour is spent by management employees in the planning and reviewing of the records for presentation to an EPA inspector and one hour by a clerical employee in the planning, gathering, and maintenance of the information.

Table 2 documents the computation of individual burdens for each of the recordkeeping and reporting requirements applicable to the industry. The individual burdens are expressed under standardized headings believed to be consistent with the concept of burden under the Paperwork Reduction Act. Where appropriate, specific tasks and major assumptions have been identified.

Responses to this information collection are mandatory, as required at FIFRA sections 8 and 12( a)( 2)( B). The Agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.

6( a) Estimating Respondent Burden The average annual burden to industry over the next three years from these recordkeeping and reporting requirements is estimated at two ( 2) person hours. These hours are based on Agency knowledge and experience with the pesticides program, the previously approved ICR, and any comments received about time to prepare reports.

6( b) Estimating Respondent Costs ( i) Estimating Labor Costs This ICR uses labor rates of Executive, Administrative, and Managerial ($ 58.69, based on $ 27.94 per hour + 110% overhead) and Clerical ($ 26.80, based on $ 12.78 per hour + 110% overhead). These rates were from the United States Department of Commerce Bureau of Labor Statistics, March 1998, Table 2: Employment Costs for Civilian Workers by Occupational and Industry Group, as used in the last ICR, and adjusted using the DOC CPI calculator, which adjusted with a total inflation factor of 1.164 for the seven year period from 1998 to 2004. Costs are determined to be equally divided between managerial and clerical, for an average overall hourly cost of $ 42.75 including overhead.  9

( ii) Estimating Capital and Operations and Maintenance Costs The only type of industry costs associated with the information collection activity in the standards are labor costs.

( iii) Capital/ Start up vs. Operating and Maintenance ( O& M) Costs This is not applicable as there are no capital/ start up costs.

6( c) Estimating Agency Burden and Cost As part of an existing and ongoing program, the developmental costs for this information collection activity are minimal, and includes only the preparation of a written justification, narrative, and description for the clearance request, and the preparation of and description for the clearance request, and the preparation of the SF 83. The EPA estimates such costs at a GS 13 ( step 1) salary level for two work weeks. Since these activities occur only in the three year clearance period, their cost on a pro rated annual basis is one third of the total one time cost. The estimated cost is $ 1990.08 ( hourly rate of $ 34.55, with an additional benefits multiplication factor of 1.16, multiplied by 80 hours, and that number divided by 3). As a recordkeeping requirement, rather than a reporting requirement, there are no additional Federal costs directly associated with this information collection activity. Details upon which this estimate is based appear in Table 1: Agency Burden.

6( d) Estimating the Respondent Universe and Total Burden and Costs The number of existing respondents subject to 40 CFR Part 169 is 12,953 The number of new respondents subject to 40 CFR Part 169 from the previous ICR is 618, which is an adjustment reflecting fluctuations in the numbers of respondents . The total annual labor costs are $ 1,107,524 and total annual capital and O& M costs to the regulated entity are $ 0 dollars. Details upon which this estimate is based appear in Table 2: Industry Burden  10

6( e) Bottom Line Burden Hours And Cost Tables TABLE 1. AVERAGE ANNUAL EPA RESOURCE REQUIREMENT FOR PESTICIDE PRODUCERS, 40 CFR PART 169 Activity ( A) EPA hr/ Occurrence ( B) Occurrences ( C) a EPA hr/ yr ( D) b EPA Cost ($)

Preparation of ICR 80 0.333 26.666 $ 1,990 TOTAL ANNUAL HOURS 26.666 $ 2,990 Salary: ( 1 person x 27.666hrs/ year x $ 74.63/ hr) = $ 1,990/ year TOTAL ANNUAL COST TO EPA = $ 1,990 a AXB= C b Assume an hourly wage of $ 34.55 plus 116 percent to account for benefits and overhead which equals $ 74.63. This amount was multiplied by the hours per year in Column C.

TABLE 2. ANNUAL BURDEN OF REPORTING AND RECORDKEEPING REQUIREMENTS FOR PESTICIDE PRODUCERS, 40 CFR PART 169 Recordkeeping requirements ( A) Occurences/ hours per occurence ( B) Hours/ respondent / year ( C= AXB) Respondent / year ( D) Respondents per year ( E= CXD) Hours per year ( F) a Cost/ year, $

A. Read Instructions 1 0.5 0.5 12,953 6,477 $ 276,892 B. Plan Activities 1 0.5 0.5 12,953 6,477 $ 276,892 C. Implement Activities 1 1.0 1.0 12,953 12,953 $ 553,741 D. Develop Record System   N/ A b

E. Time to Enter Information   N/ A b

F. Audits   N/ A c

TOTAL ANNUAL BURDEN   25,907 $ 1,107,524 a Assume an hourly wage of $ 20.36 plus 110 percent overhead costs, which equals $ 42.75. This amount was multiplied by the hours per year in Column E. b Assume that this is in accordance with customary business practices with no additional burden to the respondent. c Burden for audits is included in activities A C .

6( f) Reasons for Change in Burden The increase in burden of 1,235 hours annually is an adjustment due to a change in the number of respondents since the last ICR. 6( g) Burden Statement The annual public reporting and recordkeeping burden for this collection of information is  11

estimated to average 2 hours per response. Burden means the total time, effort, or financial resources expended by persons to generate, maintain, retain, or disclose or provide information to or for a Federal agency. This includes the time needed to review instructions; develop, acquire, install, and utilize technology and systems for the purposes of collecting, validating, and verifying information, processing and maintaining information, and disclosing and providing information; adjust the existing ways to comply with any previously applicable instructions and requirements; train personnel to be able to respond to a collection of information; search data sources; complete and review the collection of information; and transmit or otherwise disclose the information. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations are listed in 40 CFR part 9 and 48 CFR chapter 15. To comment on the Agency's need for this information, the accuracy of the provided burden estimates, and any suggested methods for minimizing respondent burden, including the use of automated collection techniques, EPA has established a public docket for this ICR under Docket ID No. OECA 2004 0017, which is available for public viewing at the Enforcement and Compliance Docket and Information Center in the EPA Docket Center ( EPA/ DC), EPA West, Room B102, 1301 Constitution Ave., NW, Washington, DC. The EPA Docket Center Public Reading Room is open from 8: 30 a. m. to 4: 30 p. m., Monday through Friday, excluding legal holidays. The telephone number for the Reading Room is ( 202) 566 1744, and the telephone number for the Enforcement and Compliance Docket is ( 202) 564 1927). An electronic version of the public docket is available through EPA Dockets ( EDOCKET) at http:// www. epa. gov/ edocket. Use EDOCKET to submit or view public comments, access the index listing of the contents of the public docket, and to access those documents in the public docket that are available electronically. Once in the system, select " search," then key in the docket ID number identified above. Also, you can send comments to the Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street, NW, Washington, DC 20503, Attention: Desk Office for EPA. Please include the EPA Docket ID No. ( OECA 2004 0017) and OMB control number ( 2070 0028) in any correspondence.

Part B of the Supporting Statement This part is not applicable because no statistical methods were used in collecting this information.


[Federal Register Volume 86, Number 150 (Monday, August 9, 2021)]
[Notices]
[Page 43539]
[FR Doc No: 2021-16923]

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

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. EL21-92-000]

Carolinas Clean Energy Business Association v. PJM
Interconnection, L.L.C., Duke Energy Process, LLC; Notice of Complaint

    Take notice that on July 30, 2021, pursuant to sections 206 and
306, of the Federal Power Act, 16 U.S.C. 824e and 825e, and Rule 206 of
the Federal Energy Regulatory Commission's (Commission) Rules of
Practice and Procedure, 18 CFR 385.206, Carolinas Clean Energy Business
Association (Complainant) filed a formal complaint against PJM
Interconnection, L.L.C. (PJM) and Duke Energy Process, LLC (DEP)
seeking an order finding that the PJM and DEP's process to effectuate
Affected System coordination for generation interconnection is not just
and reasonable and is unduly discriminatory and preferential,
requesting that the Commission order PJM and DEP to adopt specific
reforms in their respective Open Access Transmission Tariff and Joint
Operating Agreement and requesting fast track processing, all as more
fully explained in the complaint.
    The Complainant certifies that copies of the complaint were served
on the contacts listed for Respondents in the Commission's list of
Corporate Officials.
    Any person desiring to intervene or to protest this filing must
file in accordance with Rules 211 and 214 of the Commission's Rules of
Practice and Procedure (18 CFR 385.211, 385.214). Protests will be
considered by the Commission in determining the appropriate action to
be taken, but will not serve to make protestants parties to the
proceeding. Any person wishing to become a party must file a notice of
intervention or motion to intervene, as appropriate. The Respondents'
answer and all interventions, or protests must be filed on or before
the comment date. The Respondents' answer, motions to intervene, and
protests must be served on the Complainant.
    The Commission strongly encourages electronic filings of comments,
protests and interventions in lieu of paper using the ``eFiling'' link
at http://www.ferc.gov. Persons unable to file electronically may mail
similar pleadings to the Federal Energy Regulatory Commission, 888
First Street NE, Washington, DC 20426. Hand delivered submissions in
docketed proceedings should be delivered to Health and Human Services,
12225 Wilkins Avenue, Rockville, Maryland 20852.
    In addition to publishing the full text of this document in the
Federal Register, the Commission provides all interested persons an
opportunity to view and/or print the contents of this document via the
internet through the Commission's Home Page (http://ferc.gov) using the
``eLibrary'' link. Enter the docket number excluding the last three
digits in the docket number field to access the document. At this time,
the Commission has suspended access to the Commission's Public
Reference Room, due to the proclamation declaring a National Emergency
concerning the Novel Coronavirus Disease (COVID-19), issued by the
President on March 13, 2020. For assistance, contact the Federal Energy
Regulatory Commission at<EMAIL_ADDRESS>or call toll-free,
(886) 208-3676 or TYY,<PHONE_NUMBER>.
    Comment Date: 5:00 p.m. Eastern Time on August 19, 2021.

    Dated: August 3, 2021.
Debbie-Anne A. Reese,
Deputy Secretary.
[FR Doc. 2021-16923 Filed 8-6-21; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register: March 27, 2007 (Volume 72, Number 58)]
[Rules and Regulations]
[Page 14235-14239]
[DOCID:fr27mr07-2]

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

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 358

[Docket No. RM07-6-001; Order No. 690-A]

Order on Clarification and Rehearing

Issued March 21, 2007.
AGENCY: Federal Energy Regulatory Commission.

ACTION: Final rule.

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

SUMMARY: This order responds to four requests for clarification or, in
the alternative, rehearing of the interim rule which the Federal Energy
Regulatory Commission issued on January 9, 2007. The Commission issued
the interim rule in response to the decision of the United States Court
of Appeals for the District of Columbia vacating and remanding the
standards of conduct rule, Order No. 2004, as applicable to interstate
natural gas pipelines, in National Fuel Gas Supply Corporation v. FERC,
468 F.3d 831 (D.C. Cir. 2006).
    In this order, the Commission grants clarification that the
standards of conduct for natural gas transmission providers under the
interim rule apply only to natural gas transmission providers that are
affiliated with a marketing or brokering entity that conducts
transportation transactions on such natural gas transmission provider's
pipeline. The Commission also grants clarification that the definition
for a marketing or brokering entity for a natural gas transmission
provider is identical to the definition under the pre-Order No. 2004
standards of conduct. With regards to the other issues for which
clarification or rehearing is sought, the Commission will defer
consideration of these matters in this proceeding and address them
contemporaneously with the rulemaking proceeding in Docket No. RM07-1-
000.

EFFECTIVE DATE: This rule is effective on March 27, 2007.

FOR FURTHER INFORMATION CONTACT:

Stuart Fischer, Office of Enforcement, Federal Energy Regulatory
Commission, 888 First Street, NE., Washington, DC 20426, Telephone:
(202) 502-8517, E-mail<EMAIL_ADDRESS>

Deme Anas, Office of Enforcement, Federal Energy Regulatory Commission,
888 First Street, NE., Washington, DC 20426, Telephone:<PHONE_NUMBER>,
E-mail<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: Before Commissioners: Joseph T. Kelliher,
Chairman; Suedeen G. Kelly, Marc Spitzer, Philip D. Moeller, and Jon
Wellinghoff.

Standards of Conduct for Transmission Providers

I. Introduction

    1. On January 9, 2007, the Commission issued an interim rule
promulgating interim standards of conduct regulations that govern the
relationship between natural gas transmission providers and their
marketing affiliates.\1\ The Commission issued the interim rule to
respond to the decision of the United States Court of Appeals for the
District of Columbia concerning the Standards of Conduct for
Transmission Providers under Order No. 2004.\2\ The purpose of the
interim rule was to repromulgate the standards of conduct not
challenged in the National Fuel appeal in the interim while the
Commission considered how to respond to the court's decision on a
permanent basis. Subsequently, on January 18, 2007, the Commission
issued a Notice of Proposed Rulemaking (NOPR) in which the Commission
proposed making the provisions of the interim rule permanent, as well
as proposing other changes to the standards of conduct for natural gas
and electric transmission providers.\3\ The Commission invited comments
on the proposals in the NOPR, and comments are due on March 30,
2007.\4\
---------------------------------------------------------------------------

    \1\ Standards of Conduct for Transmission Providers, Order No.
690, 72 FR 2427 (Jan. 19, 2007); FERC Stats. & Regs. ] 31,327
(2007). (Interim Rule). The Commission issued an errata notice on
January 22, 2007 that made corrections to paragraph 18 and the
regulatory text.
    \2\ Standards of Conduct for Transmission Providers, Order No.
2004, FERC Stats. & Regs., Regulations Preambles ] 31,155 (2003),
order on reh'g, Order No. 2004-A, III FERC Stats. & Regs. ] 31,161
(2004), 107 FERC ] 61,032 (2004), order on reh'g, Order No. 2004-B,
III FERC Stats. & Regs. ] 31,166 (2004), 108 FERC ] 61,118 (2004),
order on reh'g, Order No. 2004-C, 109 FERC ] 61,325 (2004), order on
reh'g, Order No. 2004-D, 110 FERC ] 61,320 (2005), vacated and
remanded as it applies to natural gas pipelines, National Fuel Gas
Supply Corporation v. FERC, 468 F.3d 831 (D.C. Cir. 2006) (National
Fuel).
    \3\ Standards of Conduct for Transmission Providers, 72 FR 3958
(Jan. 29, 2007), FERC Stats. & Regs. ] 32,611 (2007).
    \4\ On March 1, 2007, the Commission issued an order extending
the deadline for submitting initial comments by 15 days to March 30,
2007 and extending the deadline for submitting reply comments an
additional 10 days to April 30, 2007.
---------------------------------------------------------------------------

    2. Four petitioners, the Interstate Natural Gas Association of
America (INGAA), CenterPoint Energy Gas Transmission Company
(CenterPoint), the National Fuel Companies (National Fuel) and Spectra
Energy Transmission, LLC (Spectra) (petitioners or four petitioners),
filed requests for clarification or, in the alternative, rehearing of
the interim rule.\5\ INGAA and CenterPoint seek expedited consideration
so that a decision is issued prior to the comment deadline for the
NOPR. As discussed below, the Commission grants clarification that the
standards of conduct for natural gas transmission providers under the
interim rule apply only to natural gas transmission providers that are
affiliated with a marketing or brokering entity that conducts
transportation transactions on such natural gas transmission provider's
pipeline, and that the definition for ``marketing or brokering'' is
consistent with the definition of that term under the natural gas
transmission standards of conduct prior to Order No. 2004. The
Commission will amend the regulatory text accordingly to reflect these
clarifications. With regards to the other issues for which
clarification or rehearing is sought, the Commission will address those
issues contemporaneously with the rulemaking proceeding in Docket No.
RM07-1-000.
---------------------------------------------------------------------------

    \5\ CenterPoint incorporated by reference INGAA's filing.
---------------------------------------------------------------------------

II. The D.C. Circuit's Decision in National Fuel

    3. In National Fuel, the court found that the Commission did not
support the standards of conduct's expansive definition of energy
affiliates, vacated Order Nos. 2004, 2004-A, 2004-B, 2004-C and 2004-D
(collectively referred to as Order No. 2004) as applied to natural gas
pipelines, and remanded the orders to the Commission.\6\ Specifically,
the court rejected the Commission's extension of the standards of
conduct beyond pipelines' relationships with their marketing affiliates
to govern pipelines' relationships with numerous non-marketing
affiliates, such as producers, gatherers, and local distribution
companies (non-marketing energy affiliates), as well as extending the
standards of conduct to affiliates that do not ship on their affiliated
pipelines.\7\ In light of these findings, the court found moot the
other issues raised on appeal.\8\
---------------------------------------------------------------------------

    \6\ National Fuel, slip op. at 4. Order No. 2004 was not
appealed as it applies to electric utility transmission providers.
    \7\ Id., slip op. at 25.
    \8\ Id., slip op. at 4.
---------------------------------------------------------------------------

III. The Interim Rule

    4. In the interim rule, the Commission repromulgated the standards
of conduct not challenged in the National Fuel appeal and adopted or
revised other provisions of the standards of conduct that had been the
subject of the appeal, while the Commission considers how to respond to
the court's decision on a permanent basis.\9\ The Commission intended
the interim rule to eliminate any uncertainty about how the standards
of conduct apply to natural gas transmission providers while the
Commission developed a final rule.\10\ The Commission adhered to both
the letter and the spirit of the court's decision in National Fuel by
fashioning an interim rule under which the standards of conduct do not
apply to the relationship between natural gas transmission providers
and non-marketing energy affiliates, which is the aspect of the
standards of conduct that the court found infirm.\11\
---------------------------------------------------------------------------

    \9\ Interim Rule at P 2.
    \10\ Id.
    \11\ Id. at P 5 and 7.
---------------------------------------------------------------------------

    5. Although the DC Circuit did not consider petitioners' other
issues on appeal, under the interim rule the Commission treated each of
those issues as if the court had also overturned those sections.
Specifically, for natural gas transmission providers, the interim rule:
(1) Omitted restrictions on shared risk management employees \12\ and
(2) revised the requirement for logging waivers of tariff provisions so
that it was identical to the Order No. 497 requirements.\13\ The
Commission also incorporated modifications consistent with petitioners'
appeals of two issues discussed in the preamble of Order No. 2004, but
not codified in regulatory text.

Specifically, the interim rule stated that: (1) Natural gas
transmission providers could treat lawyers as permissibly shared
employees; and (2) newly certificated natural gas pipeline transmission
providers would not be required to observe the standards of conduct
until they commence transmission services.\14\
---------------------------------------------------------------------------

    \12\ Section 358.4(a)(6) of the Commission's regulations states
that ``Transmission Providers are permitted to share risk management
employees that are not engaged in Transmission Functions or sales or
commodity Functions with their Marketing and Energy Affiliates.'' 18
CFR 358.4(a)(6). The interim rule modified this provision by adding
a second sentence that states, ``This provision does not apply to
natural gas transmission providers.''
    \13\ Section 358.5(c)(4) of the Commission's regulations states
that ``The Transmission Provider must maintain a written log,
available for Commission audit, detailing the circumstances and
manner in which it exercised its discretion under any terms of the
tariff. The information contained in this log is to be posted on the
OASIS or Internet web site within 24 hours of when a Transmission
Provider exercises its discretion under any terms of the tariff.''
18 CFR 358.5(c)(4). The interim rule changed 18 CFR 358.5(c)(4) by
renumbering it as 18 CFR 358.5(c)(4)(i) and added a new provision in
18 CFR 358.5(c)(4)(ii) as follows: ``[N]atural gas Transmission
Providers must maintain a written log of waivers that the natural
gas Transmission Provider grants with respect to tariff provisions
that provide for such discretionary waivers and provide the log to
any person requesting it within 24 hours of the request.'' 18 CFR
358.5(c)(4)(ii).
    \14\ Former 18 CFR 161.3(k); Interim Rule at P 22.
---------------------------------------------------------------------------

    6. The Commission issued the interim rule consistent with the three
factors articulated in Mid-Tex Electric Cooperative, Inc. v. FERC (Mid-
Tex) \15\ for issuing an interim rule without prior notice and comment
under the Administrative Procedure Act.\16\ First, the Commission
stressed that the interim rule was not intended to serve as a permanent
rule and that it was commencing a rulemaking proceeding through the
issuance of a NOPR (issued nine days after the interim rule).\17\
Second, the interim rule followed the court's opinion in National Fuel
because, for natural gas pipelines, it eliminated the provisions of
Order No. 2004 that were subject to appeal and instead adopted
provisions originally promulgated in Order No. 497, which was upheld in
relevant part by the court in Tenneco Gas v. FERC.\18\ Third, the
Commission issued the interim rule to avoid regulatory confusion. When
the Commission adopted Order No. 2004, it rescinded the standards of
conduct promulgated by Order No. 497. Because National Fuel vacated
Order No. 2004 as applied to natural gas transmission providers,
without the interim rule there would have been no existing regulations
governing the relationship between natural gas transmission providers
and their marketing affiliates. Such a situation would not have been in
the public interest because the standards of conduct have for almost
two decades played an important role in the Commission's program to
ensure non-discriminatory access by pipeline customers to competitive
natural gas markets.\19\
---------------------------------------------------------------------------

    \15\ Mid-Tex Electric Cooperative, Inc. v. FERC, 822 F.2d 1123
(DC Cir. 1987).
    \16\ Interim Rule at P 3-6.
    \17\ Id. at P 6.
    \18\ Order No. 497, 53 FR 22139 (June 14, 1988), FERC Stats. &
Regs., Regulations Preambles 1986-1990 ] 30,820 (June 1, 1988);
Order No. 497-A, order on reh'g, 54 FR 52781 (Dec. 22, 1989), FERC
Stats. & Regs., Regulations Preambles 1986-1990 ] 30,868 (Dec. 15,
1989); Order No. 497-B, order extending sunset date, 55 FR 53291
(Dec. 28, 1990), FERC Stats. & Regs., Regulations Preambles 1986-
1990 ] 30,908 (Dec. 13, 1990); Order No. 497-C, order extending
sunset date, 57 FR 9 (Jan. 2, 1992), FERC Stats. & Regs.,
Regulations Preambles 1991-1996 ] 30,934 (Dec. 20, 1991), reh'g
denied, 57 FR 5815 (Feb. 18, 1992), 58 FERC ] 61,139 (Feb. 10,
1992); Tenneco Gas v. FERC (affirmed in part and remanded in part),
969 F.2d 1187 (D.C. Cir. 1992); Order No. 497-D, order on remand and
extending sunset date, 57 FR 58978 (Dec. 14, 1992), FERC Stats. &
Regs., Regulations Preambles 1991-1996 ] 30,958 (Dec. 4, 1992);
Order No. 497-E, order on reh'g and extending sunset date, 59 FR 243
(Jan. 4, 1994), FERC Stats. & Regs., Regulations Preambles 1991-1996
] 30,987 (Dec. 23, 1993); Order No. 497-F, order denying reh'g and
granting clarification, 59 FR 15336 (Apr. 1, 1994), 66 FERC ] 61,347
(Mar. 24, 1994); and Order No. 497-G, order extending sunset date,
59 FR 32884 (June 27, 1994), FERC Stats. & Regs., Regulations
Preambles 1991-1996 ] 30,996 (June 17, 1994).
    \19\ Interim Rule at P 6.
---------------------------------------------------------------------------

IV. Petitions for Clarification and Rehearing

    7. Petitioners filed requests for clarification or rehearing on
five issues. First, the four petitioners seek clarification or
rehearing as to whether the interim rule limits the application of the
standards of conduct to natural gas transmission providers that are
affiliated with a marketing or brokering entity that conducts
transportation transactions on such natural gas transmission provider's
pipeline. The four petitioners contend that under Order No. 497, a
natural gas transmission provider was not subject to the standards of
conduct if its marketing affiliate did not engage in transportation
transactions on its pipeline. INGAA states that if the Commission
intended the interim rule to return to the pre-Order No. 2004 standards
of conduct requirements for natural gas pipelines, this condition must
be included or the interim rule should not have been issued without
notice or comment. All four petitioners request that Sec.  358.1 of the
interim rule be amended to include the language from the prior
standards of conduct in former Sec.  161.1, which limited the
application of the standards of conduct to natural gas transmission
providers which conduct transportation transactions with its marketing
or brokering affiliates.\20\
---------------------------------------------------------------------------

    \20\ Former 18 CFR 161.1 stated that ``This part applies to any
interstate natural gas pipeline that transports gas for others
pursuant to subpart A of part 157, and subparts B or G or part 284
and is affiliated in any way with a natural gas marketing or
brokering entity and conducts transportation transactions with its
marketing or brokering affiliate.''
---------------------------------------------------------------------------

    8. Second, the petitioners assert that the Commission erred in
defining marketing affiliate in Sec.  358.3(k) of the Commission's
regulations. INGAA contends that the definition of ``Marketing
Affiliate'' in Sec.  358.3(k) should treat natural gas pipeline
transmission providers separately from electric transmission providers:
for natural gas transmission providers, the definition of marketing
affiliate should reference the definition of ``marketing or brokering''
in Sec.  358.3(l). For electric transmission providers, the definition
of marketing affiliate should reference the definition of ``marketing,
sales, or brokering'' in Sec.  358.3(e). This change, INGAA contends,
would make clear that Sec.  358.3(e)'s definition of ``marketing, sales
or brokering'' is not relevant to identifying the marketing affiliates
of natural gas transmission providers. INGAA asserts that sales of
electric energy were not part of the definition of ``marketing or
brokering'' under the former natural gas standards of conduct under
Order No. 497, and thus should not apply to natural gas transmission
providers under the interim rule. All four petitioners support an
identical language change to the definition of marketing affiliate in
Sec.  358.3(k) to clarify this point.
    9. Third, the four petitioners contend that Sec.  358.1(e) of the
Commission's regulations promulgated in the interim rule has the
unintended consequence of including more entities as marketing
affiliates than under the prior gas standards of conduct.\21\
Specifically, INGAA and National Fuel contend that an entity that falls
under one of the exceptions to the definition of an energy affiliate
under Sec.  358.3(d)(6) of the Commission's regulations could now be
considered to be classified as a marketing affiliate of a gas pipeline.
---------------------------------------------------------------------------

    \21\ Section 358.1(e) of the Commission's regulations states
that the standards of conduct do not govern the relationship between
a natural gas transmission provider and its energy affiliate. 18 CFR
358.1(e).
---------------------------------------------------------------------------

    10. Fourth, the four petitioners contend that the Commission erred
by amending Sec.  358.4(a)(6) of the Commission's regulations to
remove, for natural gas transmission providers, the exception allowing
transmission providers to share risk management employees with
marketing and energy affiliates provided that the risk managers are not
engaged in transmission functions or sales or commodity functions.
INGAA contends it appealed this issue to the D.C. Circuit on the
grounds that the Commission had imposed too many restrictions on the
sharing of risk management personnel. As such, the four petitioners
contend that the Commission should add a provision that expressly
permits natural gas transmission providers to share risk management
employees with their marketing affiliates.
    11. Finally, the four petitioners request that the Commission
clarify the effect of restoring the language of former Sec.  161.3(k)
of the Commission's regulations, requiring natural gas transmission
providers to maintain a waiver log, in new Sec.  358.5(c)(4)(ii) of the
Commission's regulations. Specifically, they assert that the current
provision (as well as the prior provision in Sec.  161.3(k))

apply only to granting waivers under the tariff and does not apply to
acts of discretion under the tariff. INGAA requests that the Commission
clarify that a pipeline will be in compliance with the interim rule if
the pipeline logs waivers, but not every act of discretion, in a
situation when (1) a pipeline tariff expressly permits the pipeline to
waive a specific tariff requirement; and (2) the pipeline waives a
tariff requirement.

V. Commission Determination

    12. As noted earlier, the Commission's intent in promulgating the
interim rule with respect to natural gas transmission providers was to
restore the pre-Order No. 2004 standards of conduct in order to avoid a
regulatory gap once the D.C. Circuit issued its decision in National
Fuel vacating Order No. 2004 as applied to natural gas transmission
providers. The interim rule was intended to be a temporary measure
while the Commission promulgated permanent regulations in light of
National Fuel, a process the Commission started in the NOPR in Docket
No. RM07-1-000. The Commission did not intend for the interim rule to
create any new standards of conduct obligations or new exceptions for
natural gas transmission providers that were not in place prior to
Order No. 2004.
    13. As such, the Commission will grant clarification to revise the
standards of conduct regulations under the interim rule to reflect the
prior standards of conduct for natural gas transmission providers under
Order No. 497. Specifically, the Commission agrees with the requests
to: (a) Revise Sec.  358.1 to include the language from former Sec.
161.1 limiting the standards of conduct to natural gas transmission
providers that conduct transmission transactions with their marketing
or brokering affiliates; and (b) revise the definition of ``marketing
affiliate'' in Sec.  358.3(k) to tie it to the definition of
``marketing and brokering'' for natural gas transmission provider in
Sec.  358.3(l) (which uses the definition under Order No. 497). With
respect to entities covered by the standards of conduct, these
clarifications reflect the Commission's intent that the scope of the
interim rule track the scope of the standards of conduct requirements
for natural gas transmission providers in Order No. 497.
    14. Accordingly, the standards of conduct will not govern the
relationship of a natural gas transmission provider and its affiliate
that engages in marketing or brokering activities (as defined in Sec.
358.3(l)) if that affiliate does not conduct transportation
transactions on that natural gas transmission provider's pipeline. Also
the standards of conduct do not govern the relationship between a
natural gas transmission provider and its electric affiliate that
engages in electric marketing, sales or brokering activities (as
defined in Sec.  358.3(e)) as long as that electric affiliate does not
(i) Engage in natural gas marketing activities under Sec.  358.3(l) and
(ii) conduct transportation transactions on the affiliated natural gas
transmission provider's pipeline.
    15. The Commission intends to address the remainder of the issues
raised by the four petitioners contemporaneously with the rulemaking
proceeding in Docket No. RM07-1-000. Unlike the requests for which the
Commission is granting clarification, the four petitioners' remaining
requests do not seek to have the Commission restore the language of the
standards of conduct for natural gas transmission providers as it
existed prior to Order No. 2004. Instead, the four petitioners'
remaining requests seek rehearing by asserting that certain provisions
in Order No. 2004 which the court had vacated should be applicable to
them or by seeking interpretations of language that the Commission
restored from Order No. 497. As such, the consideration of such issues
goes beyond the scope of what the Commission intended in the interim
rule, namely, to restore the rules in place prior to National Fuel
until the current rulemaking proceeding is completed. The Commission
believes that consideration of the remaining issues with the rulemaking
proceeding in Docket No. RM07-1-000 will lead to a more efficient
disposition of the four petitioners' remaining contentions, because
they relate to which provisions of Order No. 2004 should be retained
and how they should be interpreted. Again, the Commission affirms that
the clarifications made to the standards of conduct for natural gas
transmission providers in the interim rule were not intended to create
new standards of conduct requirements beyond the requirements prior to
Order No. 2004.

VI. Document Availability

    16. In addition to publishing the full text of this document in the
Federal Register, the Commission provides all interested persons an
opportunity to view and/or print the contents of this document via the
Internet through FERC's Home Page (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.
    17. From FERC's Home Page on the Internet, this information is
available on eLibrary. The full text of this document is available on
eLibrary in PDF and Microsoft Word format for viewing, printing, and/or
downloading. To access this document in eLibrary, type the docket
number excluding the last three digits of this document in the docket
number field.
    18. User assistance is available for eLibrary and the FERC's Web
site during normal business hours from our Help line at<PHONE_NUMBER>
or the Public Reference Room at<PHONE_NUMBER> Press 0, TTY (202) 502-
8659. E-Mail the Public Reference Room at
<EMAIL_ADDRESS>

VII. Effective Date

    19. These revisions in this order on clarification and rehearing
are effective on March 27, 2007.

List of Subjects in 18 CFR Part 358

    Natural gas, Reporting and recordkeeping requirements.

    By the Commission.
Philis J. Posey,
Acting Secretary.

0
In consideration of the foregoing, the Commission amends part 358,
Chapter I, Title 18, Code of Federal Regulations, to read as follows:

PART 358--STANDARDS OF CONDUCT

0
1. The authority citation for part 358 continues to read as follows:

    Authority: 15 U.S.C. 717-717w, 3301-3432; 16 U.S.C. 791-825r,
2601-2645; 31 U.S.C. 9701; 42 U.S.C. 7101-7352.

0
2. In Sec.  358.1, paragraph (a) is revised to read as follows:

Sec.  358.1  Applicability.

    (a) This part applies to any interstate natural gas pipeline that
transports gas for others pursuant to subpart A of part 157 or subparts
B or G of part 284 of this chapter and is affiliated in any way with a
marketing or brokering entity and conducts transportation transactions
with its marketing or brokering affiliate.
* * * * *

0
3. In Sec.  358.3, paragraph (k) is revised to read as follows:

Sec.  358.3  Definitions.

* * * * *
    (k) Marketing Affiliate means an Affiliate as that term is defined
in Sec.  358.3(b) or a unit that--
    (1) With respect to a natural gas pipeline Transmission Provider,
engages in ``marketing and brokering'' activities

as those terms are defined at Sec.  358.3(l); and
    (2) With respect to an electric Transmission Provider, engages in
marketing, sales or brokering activities as those terms are defined at
Sec.  358.3(e).
* * * * *
[FR Doc. E7-5497 Filed 3-26-07; 8:45 am]

BILLING CODE 6717-01-P