[Federal Register: December 1, 2006 (Volume 71, Number 231)]
[Rules and Regulations]
[Page 69440-69476]
[DOCID:fr01de06-6]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Parts 50 and 380

[Docket No. RM06-12-000; Order No. 689]

Regulations for Filing Applications for Permits to Site
Interstate Electric Transmission Facilities

Issued November 16, 2006.
AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Final rule

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SUMMARY: The Federal Energy Regulatory Commission (Commission) is
implementing new regulations in accordance with section 1221 of the
Energy Policy Act of 2005 to establish filing requirements and
procedures for entities seeking to construct electric transmission
facilities. The regulations will coordinate the processing of Federal
authorizations and environmental review of electric transmission
facilities in national interest transmission corridors.

DATES: Effective Date: This rule will become effective February 2,
2007.

FOR FURTHER INFORMATION CONTACT:
John Schnagl, Office of Energy Projects, Federal Energy Regulatory
Commission, 888 First Street, NE., Washington, DC 20426. (202) 502-
8756<EMAIL_ADDRESS>Carolyn Van Der Jagt, Office of the General Counsel, Federal Energy
Regulatory Commission, 888 First Street, NE., Washington, DC 20426.
(202) 502-8620<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

                            TABLE OF CONTENTS

                                                              Paragraph
                                                               numbers

I. Background..............................................            2
II. Discussion.............................................           11
    A. National Interest Transmission Corridors............           11
    B. Permit Findings.....................................           14
        1. Commission Jurisdiction under 216(b)(1).........           14
            a. One Year Clock/Pre-filing...................           16
            b. Withholding/Conditioning Approval...........           24
            c. Other Jurisdictional Issues.................           35
        2. Other Findings under 216(b)(2) through (6)......           37
    C. Project Participation...............................           45
        1. Landowners......................................           50
        2. Stakeholders and Notification...................           60
        3. Document Availability...........................           73
        4. Participation Process...........................           74
    D. Pre-filing..........................................           90
        1. Initial Consultation Issues.....................           92
        2. Third-party Contractors.........................          100
        3. Subsequent Filing Requirements..................          103
        4. Lead Agency Issues/Coordinating Federal Permits.          105
        5. Timeframe for Pre-filing........................          112
        6. Review of Director's Decisions in Pre-filing....          116
    E. Application Requirements............................          118
    F. Filing Requirements.................................          120
        1. State Record....................................          122
        2. Exhibits........................................          126
            a. Exhibit E--Maps.............................          129
            b. Exhibit F--Environmental Requirements.......          130

                i. Section 380.5-Actions that Require EAs..          134
                ii. Section 380.6 Actions that Require EISs          135
                iii. Section 380.10--Participation in                137
                 Commission Proceeding.....................
                iv. Resource Report 1--General Requirements          138
                v. Resource Report 2--Water Use and Quality          142
                vi. Resource Report 3-Fish, Wildlife, and            144
                 Vegetation................................
                vii. Resource Report 4--Cultural Resources.          146
                viii. Resource Report 5--Socioeconomics....          150
                ix. Resource Report 6--Geological Resources          159
                x. Resource Report 7--Soils................          160
                xi. Resource Report 8--Land Use,                     162
                 Recreation, and Aesthetics................
                xii. Resource Report 9--Alternatives.......          175
                xiii. Resource Report 10--Reliability and            180
                 Safety....................................
                xiv. Resource Report 11--Design and                  182
                 Engineering...............................
            c. Exhibit G--Engineering Data.................          185
            d. Exhibit H--System Analysis Data.............          188
            e. Exhibit I--Project Cost and Financing.......          192
    G. Critical Energy Infrastructure Information..........          194
    H. Accepting/Rejecting Applications....................          198
    I. Hearings............................................          199
    J. Permit Conditions...................................          204
    K. State and Local Permits.............................          213
    L. Subsequent Modifications to Facilities..............          219
    M. Definitions.........................................          221
    N. Eminent Domain Issues...............................          225
    O. Filing Fees/Funding.................................          228
    P. Technical Conferences...............................          229
III. Information Collection Statement......................          231
IV. Environmental Analysis.................................          236
V. Regulatory Flexibility Act..............................          237
VI. Document Availability..................................          238
VII. Effective Date and Congressional Notification.........          241

Before Commissioners: Joseph T. Kelliher, Chairman; Suedeen G. Kelly,
Marc Spitzer, Philip D. Moeller, and Jon Wellinghoff.

    1. On June 16, 2006, the Federal Energy Regulatory Commission
(Commission) issued a Notice of Proposed Rulemaking (NOPR) in this
proceeding.\1\ In the NOPR, the Commission proposed regulations in
accordance with section 1221 of the Energy Policy Act of 2005 (EPAct
2005) \2\ to implement filing requirements and procedures for entities
seeking permits to construct or modify electric transmission facilities
under the circumstances set forth in that section. This Final Rule
considers comments submitted in response to the NOPR, and as a result,
makes various modifications to the regulatory text described in the
NOPR. Following the issuance of this rule, we will convene regional
conferences to assist stakeholders in its implementation.
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    \1\ 71 FR 36258 (June 26, 2006); FERC Stats. & Regs. ] 32,605
(2006).
    \2\ Pub. L. 109-58, 119 Stat. 594 (2005).
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I. Background

    2. On August 8, 2005, EPAct 2005 became law. Section 1221 of EPAct
2005 adds a new section 216 to the Federal Power Act (FPA), providing
for Federal siting of electric transmission facilities under certain
circumstances.
    3. New FPA section 216 requires that the Secretary of the
Department of Energy (DOE or Secretary) identify transmission
constraints. It mandates that the Secretary conduct a study of electric
transmission congestion within one year of enactment and every three
years thereafter, and that the Secretary then issue a report. The
Secretary is further empowered to designate certain constrained areas
as national interest electric transmission corridors (National
Corridors).
    4. FPA section 216(b) provides that the Commission may issue
permits to construct or modify electric transmission facilities in a
National Corridor under certain circumstances. The Commission has the
authority to issue permits to construct or modify electric transmission
facilities if it finds that: (1) A State in which such facilities are
located does not have the authority to approve the siting of the
facilities or to consider the interstate benefits expected to be
achieved by the construction or modification of the facilities; (2) the
applicant is a transmitting utility but does not qualify to apply for
siting approval in the State because the applicant does not serve end-
use customers in the State; or (3) the State commission or entity with
siting authority withholds approval of the facilities for more than one
year after an application is filed or one year after the designation of
the relevant national interest electric transmission corridor,
whichever is later, or the State conditions the construction or
modification of the facilities in such a manner that the proposal will
not significantly reduce transmission congestion in interstate commerce
or is not economically feasible.\3\
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    \3\ Under FPA section 216(i)(4), the Commission may not issue a
permit for facilities within a State that is a party to an
interstate compact establishing a regional transmission siting
agency unless the members of the compact are in disagreement and the
Secretary of the Department of Energy makes certain findings.
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    5. Additionally, under FPA sections 216 (b)(2) through (6), before
issuing a permit the Commission must find that the proposed facility:
(1) Will be used for the transmission of electric energy in interstate
commerce; (2) is consistent with the public interest; (3) will
significantly reduce transmission congestion in interstate commerce and
protect or benefit consumers; (4) is consistent with sound national
energy policy and will enhance energy

independence; and (5) will maximize, to the extent reasonable and
economical, the transmission capabilities of existing towers or
structures.
    6. New FPA section 216(h)(2) designates DOE as lead agency to
coordinate all Federal authorizations needed to construct proposed
electric transmission facilities in National Corridors. Under FPA
section 216(h)(4)(A), to ensure timely efficient reviews and permit
decisions, DOE is required to establish prompt and binding intermediate
milestones and ultimate deadlines for all Federal reviews and
authorizations required for a proposed electric transmission
facility.\4\ Section 216(h)(5)(A) of the FPA requires that DOE as lead
agency, in consultation with the other affected agencies, prepare a
single environmental review document that would be used as the basis
for all decisions for the proposed projects under Federal law.
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    \4\ Under FPA section 216(h)(6)(A), if any agency has denied a
Federal authorization required for a transmission facility, or has
failed to act by the deadline established by the Secretary, the
applicant or any State in which the facility would be located may
file an appeal with the President.
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    7. On May 16, 2006, the Secretary delegated paragraphs (2), (3),
(4)(A)-(B), and (5) of FPA section 216(h) to the Commission as they
apply to proposed facilities in designated National Corridors for which
an application for authority to construct has been submitted to the
Commission.\5\ Specifically, the Secretary delegated to the Commission
DOE's lead agency responsibilities for the purpose of coordinating all
applicable Federal authorizations and related environmental review and
preparing a single environmental review document for facilities falling
within the Commission's siting jurisdiction. With respect to such
projects, the Commission will establish prompt and binding intermediate
milestones and ultimate deadlines for the review, and ensure that all
Federal permits are issued, and reviews are completed, within a year or
as soon as practicable thereafter.
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    \5\ Department of Energy Delegation Order No. 00-004.00A.
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    8. On August 8, 2006, DOE issued its National Electric Transmission
Congestion Study that examined transmission congestion and constraints
and identified affected transmission paths in many areas of the
nation.\6\ DOE states that it expects the study to open a dialogue with
stakeholders in areas of the Nation where congestion is a matter of
concern, focusing on ways in which these problems might be alleviated.
DOE states that where appropriate in relation to the congestion areas,
it may designate National Corridors.
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    \6\ Department of Energy, National Electric Transmission
Congestion Study, Executive Summary (2006), http://www.oe.energy.gov/energy_policy/epa_sec1221.htm#Timeline
 (follow

``Congestion Study Executive Summary'' hyperlink).
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    9. Also on August 8, 2006, several Federal agencies including DOE
and the Commission entered into a Memorandum of Understanding on Early
Coordination of Federal Authorization and Related Environmental Reviews
Required in Order to Site Electric Transmission Facilities (MOU).\7\
The purpose of the MOU is to establish a framework for early
cooperation and participation that will enhance coordination of all
applicable land use authorizations, related environmental, cultural,
and historic preservation reviews, and any other approvals that may be
required under Federal law in order to site an electric transmission
facility.
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    \7\ The other agencies include the Department of Defense, the
Department of Agriculture, the Department of the Interior, the
Department of commerce, the Environmental Protection Agency, the
Council on Environmental Quality, and the Advisory Council on
Historic Preservation.
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    10. FPA section 216(c)(2) requires that the Commission issue rules
specifying the form of, and the information to be contained in, an
application for proposed construction or modification of electric
transmission facilities in National Corridors, and the manner of
service of notice of the permit application on interested persons. The
Commission is implementing those regulations in a new part 50 of
existing subchapter B of its regulations.

II. Discussion

A. National Interest Transmission Corridors

    11. As stated, on August 8, 2006, DOE issued its National Electric
Transmission Congestion Study and stated that where appropriate in
relation to the congestion areas, it may designate National Corridors.
Once DOE designates a National Corridor, the Commission has the
authority under FPA section 216(b) to issue permits to construct or
modify electric transmission facilities in such a corridor under
certain circumstances.
    12. The Western Interstate Energy Board and Committee on Regional
Electric Power Cooperation (Western Energy Board) and Western
Governor's Association (Western Governors) request that the Commission
delay issuing the Final Rule until DOE acts on establishing National
Corridors. Section 216(c)(2) of the FPA requires that the Commission
issue rules specifying the form of the application, the information to
be contained in the application, and the manner of service and notice
of the permit application on interested persons. While the Commission
has no authority to issue a permit unless a facility is in a National
Corridor, this does not affect the Commission's ability to put in place
the filing requirements that will apply once National Corridors are
designated. The Commission, therefore, declines to delay issuance of
the Final Rule. The Commission believes that prompt issuance of the
Final Rule, coupled with regional conferences to discuss its
implementation, is in the public interest and provides timely notice to
stakeholders of the procedures that will apply to applications
submitted under FPA section 216.
    13. American Electric Power Service Corporation (AEP) requests that
the Commission define what constitutes a National Corridor and whether
the designation is a permanent one. Massachusetts Energy and Facilities
Siting Board (Massachusetts Energy Board) requests that the Commission
define the ends, geographic dimensions, and specified boundaries for a
National Corridor. U.S. Department of the Interior (DOI) also requests
clarification on what constitutes a National Corridor. The Commission
declines to make such rulings. DOE, not the Commission, is responsible
for designating and defining the National Corridors under EPAct 2005.
Thus, it would be inappropriate for the Commission to establish an
independent definition in the Final Rule or opine on whether a corridor
designation is a permanent one.

B. Permit Findings

1. Commission Jurisdiction Under 216(b)(1)
    14. Under FPA section 216(b)(1), the Commission has the authority
to issue permits to construct or modify electric transmission
facilities if: (A) A State in which the transmission facilities are to
be constructed or modified does not have the authority to--(i) approve
the siting of the facilities; or (ii) consider the interstate benefits
expected to be achieved by the proposed construction or modification of
transmission facilities in the State; (B) the applicant for a permit is
a transmitting utility under this Act but does not qualify to apply for
a permit or siting approval for the proposed project in a State because
the applicant does not serve end-use customers in the State; or (C) a
State commission or other entity that has

authority to approve the siting of the facilities has--(i) withheld
approval for more than 1 year after the filing of an application or 1
year after the designation of the relevant national interest electric
transmission corridor, whichever is later; or (ii) conditioned its
approval in such a manner that the proposed construction or
modification will not significantly reduce transmission congestion in
interstate commerce or is not economically feasible.
    15. Numerous commenters request that the Commission specifically
address what it will require of applicants to establish the basis and
supporting rationale for the Commission's claiming jurisdiction over
proposed electric transmission facilities.\8\ Specifically, they
request that the Commission clarify how it intends to determine when
the clock starts and stops for the one-year time period for State
action on siting requests under FPA section 216(b)(1)(C). They also
request that the Commission clarify under what circumstances it will
determine that a State has withheld approval and what conditions in a
State authorization the Commission will consider sufficient to trigger
Commission jurisdiction. The commenters also request that the
Commission generally explain how, and when, it will make the
determination that it indeed has jurisdiction over a proposed project.
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    \8\ American Public Power Association (APPA), American
Transmission Co. (American Transmission), California Resources
Agency (CA Resources), Edison Electric Institute (EEI), Kentucky
Public Service Commission (Kentucky PSC), New York Department of
Public Service (DPS), New York State Senator Wright (Senator
Wright), Southern Company Services (Southern Company), Southern
California Edison Co. (SoCal Edison), Washington Energy Facility
Site Evaluation Council (Washington Council), Western Energy Board,
Western Governors, and the Wilderness Society (Wilderness).
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a. One Year Clock/Pre-Filing
    16. Many commenters request that the Commission specifically
address when the one-year period for State processing of an application
will commence. They state that the Commission should specify that the
one-year clock will not start running until the State determines that
the application submitted to it is final and in compliance with the
State's filing requirements.\9\ Several commenters contend that the
States should have the ability to re-start the one-year review period
if the applicant significantly modifies or makes substantive changes to
its application.\10\ The Wilderness Society (Wilderness) states that
the Commission should require that the applicant prove that it made a
good faith effort to comply with State siting and permitting
requirements. The Western Energy Board requests that the Commission
clarify that an applicant who has not obtained the required Federal
permit findings in support of a State application has not filed a
complete State application. Iowa Board states that one-year time period
should not include periods of appellate review.
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    \9\ Allegheny Power (Allegheny), California Public Utilities
Commission (California PUC), Iowa Utilities Board (Iowa Board),
Massachusetts Energy Board, National Association of Regulatory
Utility Commissioners (NARUC), Pennsylvania Public Utilities
Commission (Pennsylvania PUC), Pepco Holdings, Potomac Electric
Power Co., Delmarva Power & Light Co., and Atlantic City Electric
Co. (PHI Companies), San Diego Gas & Electric (SDG&E), Western
Energy Board, Public Service Commission of Wisconsin (Wisconsin
PSC), and Washington Council.
    \10\ Iowa Board, NARUC, and Wisconsin PSC.
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    17. Several commenters also request that the Commission require an
applicant demonstrate how its proposed application has met the
statutory requirements for Commission jurisdiction prior to initiating
the pre-filing process.\11\ Others request that the Commission begin
the pre-filing process while the State process is ongoing.\12\
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    \11\ CA Resources, Communities, Iowa Board, NARUC, New York PSC,
Senator Wright, SoCal Edison, Washington Council, and Western Energy
Board.
    \12\ APPA, AEP, Allegheny, Southern Companies, National Grid USA
(National Grid), SDG&E, National Rural Electric Cooperative
Association (NRECA), and Virginia Electric and Power Co. (Virginia
Electric).
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    18. Communities Against Regional Interconnect (Communities) contend
that permitting the pre-filing process to be initiated simultaneous
with the ongoing State process represents nothing more than the
Commission's desire to ``pounce'' at the moment its jurisdiction is
triggered. Communities, CA Resources, and New York DPS are concerned
that simultaneous filings could result in an unwarranted and massive
expenditure of time and resources, if it turns out the Commission lacks
jurisdiction to consider the application. Iowa Board contends that
simultaneous filing deprives States of their authority and conflicts
with the purpose of the law. Senator Wright and NARUC note that
allowing the pre-filing process to begin at such an early stage
prevents the Commission from fully considering the information brought
forth during the State siting process.
    19. The Commission appreciates the concerns of the States regarding
the potential for overlap in State and Commission siting processes.
However, the language of FPA section 216 provides for this potential
overlap by allowing the Commission to issue a construction permit one
year after the State siting process has begun and requiring an
expeditious pre-application mechanism for all permit decisions under
Federal law. Thus, the Commission pre-filing process can occur at the
same time as parallel State proceedings.\13\ To ensure that needed
infrastructure is built, Congress therefore adopted a statutory scheme
that permits parallel proceedings.
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    \13\ The Commission's pre-filing process is discussed in section
II.D. of this Final Rule.
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    20. While we believe the statute clearly permits parallel
Commission-State processes, after taking into account the comments of
State agencies and other stakeholders, we do not adopt the approach
proposed in the NOPR. Rather, we adopt an approach that is more fully
respectful of State jurisdiction.
    21. Although some overlap in State and Federal proceedings is
inevitable, as was contemplated by FPA section 216, we believe that
States which have authority to approve the siting of facilities should
have one full year to consider a siting application without there being
any overlapping Commission process. Therefore, we find that, in cases
where our jurisdiction rests on FPA section 216(b)(1)(C),\14\ the pre-
filing process should not commence until one year after the relevant
State applications have been filed. This will give the States one full
year to process an application without any intervening Federal
proceedings, including both the pre-filing and application processes.
Once that year is complete, an applicant may seek to commence our pre-
filing process. Thereafter, once the pre-filing process is complete,
the applicant may submit its application for a construction permit. We
believe this approach most adequately addresses State concerns. If we
determine in the future, however, that the lack of a Commission pre-
filing process prior to the end of the one year is delaying projects or
otherwise not in the public interest, we will reconsider this issue.
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    \14\ In all other instances (i.e., where the state does not have
jurisdiction to act or otherwise to consider interstate benefits, or
the applicant does not qualify to apply for a permit with the State
because it does not serve end use customers in the State), the pre-
filing process may be commenced at any time.
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    22. The States also express concern that the one-year time period
can be abused. For example, an applicant might not provide complete
information to the States in the hopes of frustrating their ability to
act within one year and, hence, invoking the Commission's jurisdiction.
The Commission believes such instances should be rare. We also

wish to make clear that we will not countenance such behavior. The
Commission expects all potential applicants under FPA section 216 to
act in good faith as it relates to State jurisdiction. Although the
Commission may exercise jurisdiction in all instances where a State has
withheld approval for more than one year, the Commission, in
determining whether to do so, will weigh heavily clear evidence that an
applicant has abused the State process.
    23. Under the approach adopted herein, once the one-year time
period has elapsed the applicant may commence pre-filing. At the pre-
filing consultation required under Sec.  50.5(b) of the Commission's
regulations, the applicant will need to tell Commission staff the date
that it filed its application and the status of that application. As
part of the pre-filing consultation, the Director of the Office of
Energy Projects (OEP) will review the applicant's progress at the State
proceeding. After the initial consultation process, if the Director of
OEP determines that there is sufficient reason to commence pre-filing,
a notice will be issued under Sec.  50.5(d) of the regulations. To the
extent the State proceeding is still ongoing, the Commission will host
a scoping meeting or technical conference to work with the applicant
and the State agencies to discuss the need to coordinate, among other
things, simultaneous environmental reviews. We believe that such
coordination is appropriate because, in some instances, the State may
be able to complete its action while our pre-filing process is ongoing,
possibly allowing us to terminate any proceedings under FPA section
216.
b. Withholding/Conditioning Approval
    24. Numerous commenters request that the Commission define the
criteria it would use to determine that a State has withheld approval
or conditioned its approval so as to render a project not economically
feasible, triggering Commission jurisdiction.\15\ The Western Energy
Board and California PUC maintain that a State should not be deemed to
have withheld or unreasonably conditioned approval if it fails to act
within one year because a project has not received Federal agency
approvals or because of delays related to ``another provision of
Federal law.'' California PUC points out that FPA Sec.  216(h)(4)(B)
allows the Commission to extend its process beyond a year for those
reasons.
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    \15\ Department of Interior, Iowa Utility Board, Massachusetts
Energy Board, National Parks, National Regulatory Commissioners,
Pennsylvania PUC, PJM, Washington Council, Wisconsin PSC, Western
Energy Board.
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    25. The Iowa Board and Senator Wright state that the Commission
should clarify that a State's timely and lawful denial of a
transmission project should not give rise to Commission jurisdiction.
The Iowa Board also contends that any other conclusion would allow an
applicant to sidestep an adverse State ruling by subsequently
requesting Federal jurisdiction. The Wisconsin PSC asks that the
Commission clarify that State denial for failure to meet proper State
requirements does not trigger the withheld approval provision. It
claims that this would be a situation where a State agency acted
properly and is not guilty of regulatory failure. Communities state
that the Commission should not have jurisdiction where the State denies
siting approval for valid reasons under State law, such as the
protection of environmental resources, the health and safety of its
citizens, or if better alternatives are identified through the process.
    26. FPA section 216(b)(1)(C) provides jurisdiction to the
Commission whenever a State has ``withheld approval'' for more than one
year. The statute does not explicitly define the full range of State
actions that are deemed to be withholding approval. Nonetheless, to
promote regulatory certainty, we believe it is our responsibility to
interpret the statutory language in this proceeding and to give all
parties notice of such interpretation. To this end, we believe that a
reasonable interpretation of the language in the context of the
legislation supports a finding that withholding approval includes
denial of an application.
    27. Support for this interpretation is found in comparing the
language added by EPAct 2005 as new FPA section 216(b)(1)(C)(i) to that
of new FPA section 203(a)(5), also added by EPAct 2005. There, in
requiring that the Commission grant or deny applications for approval
of certain merger transactions within 180 days after the application is
filed, the statute specifies the consequences ``[i]f the Commission
does not act.'' The Commission has an obligation to construe a statute
in such a manner as to give every word some operative effect.\16\
Interpreting the phrase ``withhold approval'' to mean ``does not act''
fails to recognize Congress' use of different words to express its
intent.
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    \16\ Cooper Industries, Inc. v. Aviall Services, Inc., 543 U.S.
157, 167 (2004).
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    28. Further support for this interpretation can be found in the
fact that in addition to giving the Commission jurisdiction to site
transmission facilities whenever a State has ``withheld approval'' for
more than a year, FPA section 216(b)(1)(C) also gives the Commission
jurisdiction to act in instances where a State has approved
construction, but ``conditioned its approval'' in such a manner that
the proposed construction or modification is not economically feasible.
Since Congress has provided the Commission with the authority to
intervene in circumstances where a State has issued an authorization
which will essentially prevent a project from going forward, it would
not be reasonable to interpret the statute in such a manner that would
leave the Commission without authority to intervene in instances where
a State has expressly denied an application.
    29. Moreover, legislative history lends support to this
interpretation of the statute. Congress devoted substantial time to
consideration of energy legislation in the years immediately prior to
the enactment of EPAct 2005. It is noteworthy that transmission siting
language first appeared in legislation considered in the House of
Representatives in 2003. That measure (H.R. 6) allowed the Commission
to exercise jurisdiction where a State entity with transmission siting
authority ``has withheld approval, conditioned its approval in such a
manner that the proposed construction or modification will not
significantly reduce transmission congestion in interstate commerce and
is otherwise not economically feasible, or delayed final approval for
more than one year after the filing of an application seeking approval
* * *.'' \17\ In addition, the report language accompanying the above
legislative text states, ``The section provides that for such lines,
persons may obtain a permit from FERC and exercise eminent domain if,
after one year, a State is unable or refuses to site the line.'' \18\
The fact that this precursor to the transmission siting provision of
EPAct 2005 distinguished ``withholding approval'' from ``delaying final
approval for more than one year'' and was interpreted to include a
State ``refusing to site a line'' supports the conclusion that
``withholding approval'' was intended to mean something beyond a
failure to act.
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    \17\ H.R. 6, 108th Cong. Sec.  16012 (2003).
    \18\ H.R. Rep No. 108-65 (April 6, 2003) (emphasis added).
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    30. Finally, Section 216(b)(1)(C)(i) allows the Commission to
exercise jurisdiction where a State entity with siting authority has
``withheld approval for more than 1 year after the filing of

an application seeking approval pursuant to applicable law * * *.'' If
an applicant seeks State siting approval pursuant to applicable law,
and the State does not grant the application within one year, the
approval is withheld, regardless of whether the State takes a specific
action denying it. Indeed, the term ``withhold'' in this context means
to refrain from granting approval, and, conversely, the term ``deny''
is synonymous with ``withhold.'' Webster's Third New International
dictionary defines ``withhold'' as ``* * * to desist or refrain from
granting, giving, or allowing * * *.'' The same dictionary defines
``deny'' as `` * * * to refuse to grant: WITHHOLD'' [caps in original].
``Denial,'' similarly, is defined as ``refusal to grant * * *:
rejection of something requested.'' Furthermore, Roget's International
Thesaurus 4th Ed., Section 776 (``Refusal'') at paragraph 776.4 lists
``deny, withhold, hold back * * *'' as synonyms. Thus, there is no
textual or lexical basis for saying that a formal denial does not
entail refraining to grant or allow (i.e. to withhold). To say that an
official denial does not count as a withholding is to say that ``to
deny'' means something other than ``to refrain from granting,'' which
would not be a reasonable interpretation.
    31. Therefore, the Commission finds that when a State fails to act
or rejects an application, it has withheld approval and the proposed
facility would be subject to the Commission's jurisdiction. However,
the fact that we possess jurisdiction does not mean that it will be
exercised in all cases. Rather, we retain the discretion, in
appropriate circumstances, to allow State processes to be completed
beyond the one-year period provided in the statute. Indeed, under the
approach described above, the States will, in many cases, have more
than two years to complete their action, and thereby avoid issuance of
a construction permit by this Commission, because our pre-filing and
construction permit processes typically take more than one year to
complete (which is in addition to the one year provided to State
authorities).
    32. We also clarify that mere consideration of an application by
the Commission does not equate to a jurisdictional determination or
Commission approval of the proposed project. Once an application is
filed for consideration by the Commission, anyone who questions the
Commission's jurisdiction over the proposed project, the timing of the
exercise of that jurisdiction, or the merits of the proposal can raise
those matters in its intervention or protest. The Commission will make
a jurisdictional determination and address comments and protests in a
subsequent order issued on the merits of the proposed project.
    33. Allegheny requests that the Commission address whether the
following would constitute withholding approval: (1) A State cannot
make a decision in one year due to State statutes or rules; (2) the
State has declined to establish a procedural schedule for reaching a
decision within a year; (3) a State commission, after an elapse of one
year, has not acted on an application; and (4) approval is conditioned
in an unacceptable manner, but does not meet the significantly reduce
transmission congestion or not economically feasible test. Wilderness
states that the Commission should adopt detailed standards defining
what constitutes an economically infeasible project or restrictions
that prevent a proposed project from significantly reducing congestion.
Communities argue that Commission jurisdiction should not be triggered
simply because mitigation measures might increase the costs of the
project. DOI also encourages the Commission to look closely at the
reason that certain conditions were imposed on a project.
    34. The Commission believes that these issues cannot be resolved
adequately on a generic basis in this rule. Rather, it is important to
consider all relevant factors presented on a case-by-case basis. The
Commission will, therefore, not limit its ability to review an
application on a case-by-case basis by establishing specific criteria
that it will consider in determining if its jurisdiction had properly
been invoked under FPA section 216(b)(1).
c. Other Jurisdictional Issues
    35. PJM Interconnection (PJM) requests that the Commission address
the Commission's jurisdiction over facilities that span multiple States
where one State may have approved the facilities and another does not.
While the Commission's jurisdiction may, in these circumstances, only
attach to the portion of the facility that would qualify under FPA
section 216(b)(1), under the National Environmental Policy Act of 1969
(NEPA), the Commission would have to analyze the impact of the entire
project. The Commission may, however, adopt State analyses where
possible. Additionally, to make its determination under FPA sections
216(b)(2) through (6) the Commission would have to review the operation
of the facility as a whole.
    36. PHI Companies request that the Commission clarify that where a
State does not have the authority to grant eminent domain rights for
transmission facilities, that constitutes the State not having
authority to approve the siting of facilities, thus giving a project
sponsor immediate access to the Commission's jurisdiction. While State
law may not authorize the taking of property by eminent domain, if it
still has laws that address the siting of electric transmission
facilities, it appears that the Commission's jurisdiction will not
attach unless the State fails to act or denies an application as
required by FPA section 216(b)(1)(C). We will, however, consider such
issues if, and when, they arise.
2. Other Findings Under 216(b)(2) Through (6)
    37. Under FPA sections 216(b)(2) through (6), the Commission must
find that the proposed facility: (1) Will be used for the transmission
of electric energy in interstate commerce; (2) is consistent with the
public interest; (3) will significantly reduce transmission congestion
in interstate commerce and protect or benefit consumers; (4) is
consistent with sound national energy policy and will enhance energy
independence; and (5) will maximize, to the extent reasonable and
economical, the transmission capabilities of existing towers or
structures.
    38. NARUC asserts that the final rule needs to state more clearly
how the Commission will implement all five of the above criteria.
Pacific Gas and Electric Company (PG&E) requests that the Commission
clarify how it intends to measure and analyze sufficient showings
related to consistency with the public interest and national policy.
DOI and Laura and John Reinhardt (Reinhardts) request that the
Commission define the criteria necessary to establish a basis for the
public interest determination. Massachusetts Energy Board states the
Commission should define ``consistent with the public interest'' to
include that there is no superior approach to the identified
transmission project; there is no superior alternative to the proposed
route; and all feasible mitigation of environmental impacts and any
adverse reliability impacts will be undertaken.
    39. Wisconsin PSC states the Commission should examine a variety of
factors, including cost-effectiveness, safety, engineering, project
alternatives, individual hardships, reliability, competitive impacts,
and environmental impact to judge whether a project is in the public
interest. PJM believes the Commission should specifically look at
adding a reliability requirement and a market efficiency analysis.
NARUC

requests that the Commission consider the impact of the project on host
States and any possible mitigation, and also require that harmful
financial impacts of the project are mitigated through an applicable
cost allocation methodology within the Commission's jurisdiction.
    40. PSEG Companies contend that the Commission should define the
term public interest to consider the energy and environmental policies
of the States where the transmitted energy will provide power. It
states that ``significant'' should be defined as it applies to the
reduction of congestion and that ``sound national energy policy''
should be clarified to consider that national security concerns will be
taken into consideration. Finally, PSEG Companies state that the
criteria for approval should be on a cost-benefit basis and an
applicant should specify whether the project is being built for
reliability or for economic reasons because that could lead to a
different evaluation. Wilderness asserts that the Commission's public
interest determination should consider the benefits of electric
transmission, the project's environmental impacts, and alternatives
with less environmental impacts. Progress Energy (Progress) cautions
the Commission to be mindful that a policy of maximum use of existing
towers and structures should be conditioned upon maintaining or
improving the reliability of the transmission system.
    41. While commenters have raised a number of valid public interest
considerations, the Commission cannot adopt an exclusive list of
factors or construct a bright-line test to determine whether a project
meets all the statutory criteria. It is difficult to construct helpful
bright line standards or tests for this area. Bright line tests are
unlikely to be flexible enough to resolve specific cases and to allow
the Commission to take into account the different interests that must
be considered. In reviewing a proposed project, the Commission will
consider all relevant factors presented on a case-by-case basis and
balance the public benefits against the potential adverse consequences.
The Commission will conduct an independent environmental analysis of
the project and determine if there is no significant impact as required
by NEPA. It will look at alternatives, including, as appropriate,
alternatives other than transmission lines, and consider whether the
proposed facilities would maximize the use of existing transmission
facilities. It will review the alternatives for their respective
impacts on the environment and will determine mitigation measures to
lessen the adverse impacts. The Commission will review the proposed
project and determine if it reduces the transmission congestion
identified in DOE's study and if it will protect or benefit consumers.
It will investigate and determine the impact the proposed facility will
have on the existing transmission grid and the reliability of the
system.
    42. The Commission will also consider the adverse effects the
proposed facilities will have on landowners and local communities. The
Commission will evaluate the entire record of the proceeding, and after
due consideration of the issues raised, determine if the proposed
project is consistent with Congress' goals and objectives in enacting
FPA section 216, while avoiding unnecessary disruptions to the
environment and the unneeded exercise of eminent domain. The
Commission's review of a proposed project will be a flexible balancing
process during which it will weigh the factors presented in a
particular application. It will impose appropriate conditions necessary
to avoid adverse economic, competitive, environmental or other effects
on the relevant interests from the construction of a new project, and
will approve the project only where the public benefits to be achieved
from the project outweigh the adverse effects.
    43. PG&E states the Commission should rebuttably presume a need for
a project subject to the independent oversight of an approved
independent system operator (ISO) or regional transmission organization
(RTO) without a direct economic interest in the application process. It
contends that this will maximize efficiency as participants must
already make showings of local or regional need to gain approval from
an ISO or RTO. PSEG Companies encourages the Commission to incorporate
the results of the RTO process into its proceeding. APPA asserts that
if a project results from an open and collaborative regional planning
process designed to meet the transmission needs of load-serving
entities (LSE) within the national interest electric transmission
corridors, or a consortium with broad LSE ownership/participation then
there should be a presumption of public interest. Similarly, NRECA
contends that the Commission cannot reasonably make the FPA section
216(b)(2) through (6) findings unless the proposed expansion or
modification arose from a truly open and inclusive joint transmission
planning process. It requests that the Commission require an applicant
to complete a joint planning process before beginning the pre-filing
process.
    44. The Commission agrees that the determinations of an independent
entity, such as an RTO, should be given due weight in our assessment of
whether a particular facility is needed to protect or benefit
customers. We will, therefore, consider any such independent
determinations as a factor, along with all other relevant factors, in
determining whether the statutory criteria have been met.

C. Project Participation

    45. Section 216(d) of the FPA requires that the Commission afford
each State in which the transmission facility covered by the permit
application is or will be located, each affected Federal agency and
Indian tribe, private property owners, and other interested persons, a
reasonable opportunity to present their views and recommendations with
respect to the need for and impact of a facility covered by the permit
application. Additionally, under FPA section 216(h)(3) and its
delegated authority, the Commission needs to coordinate the Federal
authorization and review process with any Federal agencies, Indian
tribes, multistate entities, and State agencies that are responsible
for conducting separate permitting and environmental reviews of the
facilities.
    46. Under the Commission's review process, any interested entity or
individual will have multiple opportunities to participate and express
its views on the proposed project.\19\ Under Sec.  50.4 of the
Commission's regulations, the applicant is required to develop a
Project Participation Plan (Participation Plan) to facilitate
participation from all stakeholders during the Commission's
proceedings. The Participation Plan will be used to provide accurate
and timely information, including the environmental impacts, as well as
the national and local benefits, of the proposed project, to all
stakeholders. The Commission expects that the applicant will conduct
various outreach activities to solicit comments on its proposal before
commencing the Commission's review process.
---------------------------------------------------------------------------

    \19\ The Commission considers any interested entity or
individual to be included in its definition of stakeholder in Sec.
50.1 of the Commission's regulations.
---------------------------------------------------------------------------

    47. In addition to the applicant's outreach activities, Commission
staff will conduct its pre-filing process. As part of this process,
Commission staff will start its scoping and environmental review of the
proposed project as

required by NEPA. As part of this review, it will seek comments and
recommendations from interested stakeholders. Commission staff will use
those comments during its preliminary review of the proposed project to
formulate the issues raised by the project and to assist the applicant
in compiling the information necessary for the Commission staff to
draft the environmental document and for the Commission to address
those issues during the application process.
    48. Once the application is filed, it will be noticed and
interested stakeholders will be able to file to intervene and/or file
protests and/or comments concerning the applicant's proposal.
Additionally, during the application proceeding, the Commission will
issue a draft environmental document.\20\ The environmental document
will also be subject to a comment period where any stakeholder may file
comments concerning the findings made in that document. Finally, the
Commission will issue a final environmental document and an order
addressing the issues raised in the proceeding.
---------------------------------------------------------------------------

    \20\ The Commission will issue an environmental assessment under
Sec.  380.5 or an environmental impact statement under Sec.  380.6
of the Commission's regulations depending upon the level of NEPA
review that will be required for the proposed project.
---------------------------------------------------------------------------

    49. The Commission received numerous comments on its proposal for
public participation in its siting process. Many commenters requested
clarification on how the Commission envisioned its notification
requirements would be implemented, who would be notified about the
project, and how an interested stakeholder would be able to access
information and participate in the Commission's proceedings. Some
commenters were concerned that the Commission's definition of affected
landowners was too limited. Others thought it was too broad. Some
commenters were afraid that their group may be excluded from the
definition of stakeholder. Others thought a stakeholder's right to
participate should be restricted.
1. Landowners
    50. Under Sec.  50.1, an affected landowner is an owner of property
interests, as noted in the most recent tax notice, whose property is:
(1) Directly affected, crossed or used, by the proposed project; or (2)
abuts either side of an existing right-of-way or proposed facility site
or right-of-way, or contains a residence within 50 feet of a proposed
construction work area. In addition, Sec.  50.4(c) requires that the
applicant notify any landowner with a residence within a quarter mile
from the edge of the construction right-of-way.
    51. Communities contend that the definition of affected landowner
is too limited and must be broadened to provide a fair opportunity for
intervention and a comprehensive environmental review. It states that
it should include all landowners directly affected by the proposed
facility so that all such individuals are allowed to participate fully
in the proceeding. DOI requests that the definition of affected
landowners include land management agencies. Similarly, National Parks
Conservation Association (Parks Association) requests that the
definition of affected landowner be reworded so that land managing
agencies with fee simple lands and those lands in which agencies own
scenic easements, are notified during the appropriate times.\21\ They
contend that if the Commission does not include Federal agencies as
``affected landowners,'' it needs to develop a notification criterion
for Federal agencies that manage public lands. DOI also encourages the
Commission to add a procedure for notifying stakeholders who would be
within the viewshed, but not necessarily abutting, the proposal project
to help notify other Federal governments and agencies involved in the
project.
---------------------------------------------------------------------------

    \21\ Lackawaxen River Conservancy adopts the comment of the
Parks Association.
---------------------------------------------------------------------------

    52. Parks Association requests that the reference to ``directly
affected'' landowners in Sec.  50.1(a)(1) needs to be defined since an
electricity corridor might not cross or use parklands, but could still
``directly'' affect the scenic and historic resources of a park. It
also states that a specific definition of ``used'' in Sec.  50.1 should
be added and include landowners whose property is exposed to noise and
visual impacts. Moreover, Park Associations believes the quarter mile
distance requirement is inadequate to address the possible adverse
impacts on lands discussed in the land use, recreation, and aesthetics
resource report. Massachusetts Energy Board requests that the
Commission define affected landowner using a distance greater than 50
feet from overhead transmission lines or use a definition based on a
distance from the edge of the cleared or permanent right-of-way.\22\
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    \22\ Additionally, Massachusetts Siting Board also states that
the word ``and'' should be replaced with ``or'' after the phrase
``temporary workspace''. We agree that the word ``and'' between the
two requirements should be replaced with ``or'' and have changed the
regulation accordingly.
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    53. The definition of affected landowner is meant to encompass
owners of property either directly within or adjacent to the proposed
right-of-way and construction area. If a land management agency manages
land on or adjacent to the proposed right-of-way and construction area,
it will be considered an affected landowner. While the definition only
encompasses land on or abutting a proposed right-of-way, the applicant
must also notify all landowners with a residence within a quarter mile
of the edge of the construction right-of-way under the notification
requirements of Sec.  50.4(c)(1). The Commission believes that between
the definition of affected landowner and the expanded quarter mile
notification requirement, a sufficient group of individuals will be
notified of the proposed project.
    54. Stakeholders do not need to be an affected landowner or live in
a residence within a quarter mile of the proposed site to participate
in the Commission's proceedings. Under the definition of stakeholder in
Sec.  50.1, any interested entity or person may file comments as a
stakeholder and participate in the Commission's process. Even if a
specific land management agency is not included in the definition of
affected landowner, it can still participate as a stakeholder. Resource
Report 8, in Sec.  380.16(j), requires that the applicant identify the
existing land use in the vicinity of the proposed facility, including
areas designated for studies under Federal law under Sec.
380.16(j)(7). If, for some reason, a specific land management agency is
not identified in the early planning stages of a project, as discussed
below, during the pre-filing process Commission staff will work with
the applicant to determine if any potential stakeholder has been missed
and if they have, to make sure that they have had notice of the
proposed project and an opportunity to participate.
    55. Southern states that owners with property interests that abut
an existing right-of-way should not be included in the definition of
affected landowners unless it becomes necessary to secure easements or
other rights from such owners. It argues that the definition should be
limited to owners of property interests directly affected by the
project and not to property interests that abut existing rights-of-way.
Allegheny states that the Commission should only require notification
of landowners with residence within 50 feet of a construction work
site, as required under the affected landowner definition under the
Commission's natural gas pipeline regulations in Sec.  157.6(d)(2)(ii)
and not expand the landowner group to residences within a quarter mile
of the right-of-way as required under Sec.  50.4(c).

    56. While property owners with land that abuts the proposed right-
of-way or with a residence within 50 feet of the proposed construction
work area may not be required to negotiate easements once the ultimate
route is determined, one of the purposes of the pre-filing process is
to review the applicant's proposed route and explore route alternatives
and variations based on the input the Commission receives from property
owners and other interested entities and individuals. It is important
that potentially affected property owners are notified early on in this
review process to provide the Commission with their views and
recommendations as required under FPA section 216(d). Additionally,
once construction commences, abutting property owners may be impacted
by the construction activities conducted in such close proximity to
their property and should be made aware of these activities.
    57. The Commission also believes it is appropriate to notify all
landowners within a quarter mile of the proposed right-of-way. Unlike
gas pipelines which are generally buried underground, electric
transmission lines can be seen from greater distances. Therefore, more
surrounding landowners should be directly notified by the applicant.
The fact that these landowners are not designated as affected
landowners does not diminish their right to be notified and participate
in the Commission's proceedings. Additionally, the Commission will also
notify these individuals of its intent to conduct its environmental
review and will seek comments from them during that review.
    58. PG&E states that the Commission should defer to States'
distance requirements for notification of affected landowners. It
requests that where there is no corresponding State requirement, the
Commission should designate the appropriate minimum distance between
the proposed project and a landowner's property that would trigger the
direct notification requirement. National Grid recommends that the
Commission only require notification within 300 feet of the
construction right-of-way.
    59. The Commission does not believe it is appropriate to defer to
States' distance requirements for notification of affected landowners
or that notification within 300 feet is sufficient to reach the broad
group of participants that the Commission seeks to include in these
proceedings. Moreover, having different requirements in different
States may result in inconsistent requirements along the route of a
multistate project.
2. Stakeholders and Notification
    60. Section Sec.  50.1 defines a stakeholder as a Federal, State,
or multistate, Tribal or local agency, any affected non-governmental
organization, or other interested person. In other words, a stakeholder
includes agencies and individuals contemplated under FPA section 216(d)
and the permitting agencies contemplated under FPA section
216(h)(3).\23\ Under Sec.  50.4(c) the applicant is required to notify
all known stakeholders, including affected landowners, of the proposed
new facilities or modification of existing facilities within 14 days
after the Director of OEP or his designee notifies the applicant of the
commencement of the pre-filing process. Additionally, under proposed
Sec.  50.4(c)(1)(ii), the applicant must publish the notice of the pre-
filing request and application filing twice in a daily or weekly
newspaper of general circulation in each county in which the facilities
will be located.
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    \23\ Section Sec.  50.1 defines a permitting entity as any
entity, including Federal, State, Tribal, or multistate, or local
agency that is responsible for conducting reviews for any Federal
authorization that will be required to construct an electric
transmission facility in a national interest electric transmission
corridor.
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    61. Communities states that while counties are technically included
in the definition of a person under Sec.  385.102(d) of the
Commission's regulations they should, nevertheless, be prominently
listed as stakeholders for the purposes of these regulations. Imperial
states that as a political subdivision, it should be accorded
stakeholder status. The Commission considers any interested entity or
individual to be included in its definition of stakeholder in Sec.
50.1 of the regulations. Thus, if a particular entity, such as a non-
public utility or a county, is not specifically listed in the
definition of stakeholder, it still may comment and participate in the
Commission's proceedings.
    62. SoCal Edison, PG&E, and NRECA request that the applicant
provide electric utilities and affected transmission owners and
operators with notice and opportunities to participate in the process
if they would be connected to an applicant's proposed transmission
facility, provide service in the service area, or would be impacted,
either by environmental, reliability or structural impact, as a result
of the project. Western Energy Board requests that the applicant should
also notify individuals who have expressed an interest in the State
proceeding. It also requests that the Commission include a requirement
for the applicant to periodically update the notification list as
properties change hands.
    63. The Commission agrees that electric utilities and transmission
owners and operators that are connected to the applicant's proposed
transmission facilities should be notified of the proposed project. We
also believe it is appropriate for the applicant to notify individuals
that have expressed an interest in the State proceeding, if a list of
those individuals is available to the applicant. Accordingly, we will
expand the notification requirement in Sec.  50.4(c)(1) to include
electric utilities and transmission owners and operators that are or
may be connected to the applicant's proposed transmission facilities
and any known individuals that have expressed an interest in the State
proceeding.
    64. Section 50.4(c)(3) requires that the applicant supply a
stakeholder notice of the proposed project if a stakeholder is
identified subsequent to the initial notice of the project. If a
property changes hands during the pre-filing and application
proceeding, the applicant is required to notify the new owners once
they are identified. We will not, however, require that the applicant
actively monitor land sales along the project route to determine if a
piece of property happens to be sold during the Commission's
proceedings.
    65. White Mountain Apache Tribe (White Mountain) recommends that
the Commission require applicants to publish the notice of a pre-filing
request in tribal newspapers when any part of the project will affect
tribal lands. We agree and will add tribal newspapers to the
notification requirement of Sec.  50.4(c)(1)(ii).
    66. DOI recommends that the notices published in the newspapers
include a map of sufficient detail to allow the reader an immediate
understanding of the general location or the proposed construction
right-of-way. Section 50.4(c)(2)(i)(C) requires the filing of a general
location map. The notice also provides information concerning how an
individual can seek additional information if the information in the
newspaper is not sufficient.
    67. Affiliated Tribes of Northwest Indians (Affiliated) and White
Mountain state that the Commission should assure that all Tribal
entities whose traditional lands or cultural places are crossed by a
potential project should be notified. National Grid states that the
Commission should clarify what Tribal governments involved in the
project means so the proper ones can be notified. Section 50.4(c)(1)
requires that the applicant notify tribal governments. We believe this
is sufficient to address

Affiliated's and White Mountain's concerns. We also do not believe any
clarification of Tribal government is necessary. That information is
readily available from the Bureau of Indian Affairs or the State or
Tribal Historic Preservation Office. Moreover, as discussed below, part
of the pre-filing process is for the Commission staff to work with the
applicant to determine if any potential stakeholder has been missed and
if they have, to make sure that they have had notice of the proposed
project and an opportunity to participate.
    68. EEI requests that the Commission limit the term stakeholder to
an affected agency or person.\24\ It contends that interested person
could include a broad range of parties that are not impacted by the
proposed project. Southern states that interested person should be
reasonably and precisely drawn to clearly specify the scope of their
participation, including actions these participants may take with
respect to any project or application. National Grid states that the
Commission should require stakeholders to provide notice to Commission
staff and the applicant of the stakeholder's interest and intended
involvement in the pre-filing process.
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    \24\ PHI Companies supports EEI's comments.
---------------------------------------------------------------------------

    69. The Commission intends to seek comments from a broad group of
participants during the pre-filing process. Once the application is
filed the Commission will still entertain comments from interested
entities and individuals. If anyone wishes to intervene in the
application proceeding and become a party, however, they will need to
file a motion to intervene in accordance with Sec.  385.214 of the
Commission's regulations. Under Sec.  385.214(b)(2) the motion to
intervene must show that the movant has an interest that is directly
affected by the outcome of the proceeding.
    70. Old Dominion Electric Cooperative (Old Dominion) is concerned
that stakeholders will not receive sufficient notice of the
commencement of the pre-filing proceeding because the Director of OEP
will only notify the applicant under Sec.  50.5(d). Old Dominion
suggests, among other things, that the Director's notice be published
in the Federal Register and be made available on the Commission's
website. As discussed above, the Commission has modified the group of
stakeholders listed in Sec.  50.5(e)(3) that are required to receive
notification of the Director of OEP's notice commencing the pre-
application process from the applicant. Additionally, the notice will
be available on the Commission's Web site. We find that is sufficient
notification of the commencement of the pre-filing process.
    71. Reinhardts request that the Commission require that the
applicant file a formal affidavit with: A copy of the notice sent to
landowners; a copy of the newspaper notices and list of publications
where they appeared; and the names and addresses of all notified
entities so that third parties are able to verify that the applicant
has complied with the notice requirements. Western Energy Board states
that the applicant should be held to a higher standard than ``good
faith effort'' for the notification of property owners. Affiliated
contends that the notice requirements are insufficient because there
are no penalties to assure that all stakeholders are identified at the
beginning of the project. American Transmission asserts that the
notification should be made on a good faith effort basis and
stakeholders will have a reasonable opportunity to receive notice.
NRECA states that the notification requirement should be deemed
deficient if the applicant learns of additional stakeholders after the
14-day period.
    72. Pre-filing is an information-gathering process. During this
process, Commission staff will work with the applicant to make sure
that all interested stakeholders have been made aware of the proposed
project and have had an opportunity for their views and recommendations
to be considered. Thus, part of the pre-filing process is for the
Commission staff to review who the applicant has notified and to work
with the applicant to determine if a potential stakeholder has been
missed and if they have, to make sure that they received notice of the
proposed project and an opportunity to participate. The Commission has
successfully relied on this process in its review of hydroelectric and
natural gas projects.
3. Document Availability
    73. Under Sec.  50.4(b), an applicant is required to make copies of
all of its filings readily available for all stakeholders to review at
accessible central locations, either in paper or electronic format, and
on the applicant's project Web site. Allegheny requests that the
Commission add a provision comparable to those in the natural gas
pipeline certificate regulations that reduce the applicant's service
requirements if its materials include voluminous or difficult to
reproduce material. The Commission agrees that if these materials are
readily available at central locations and on the applicant's project
Web site, it should not be required to serve these materials on all
parties as required under Sec.  385.2010 of the Commission's
regulations. Thus, we will add Sec.  50.4(b)(3) to the regulations to
state:

    An applicant is not required to serve voluminous or difficult to
reproduce material, such as copies of certain environmental
information, to all parties, as long as such material is publicly
available in an accessible central location in each county
throughout the project area and on the applicant's project Web site.
4. Participation Process
    74. As stated, under the Commission's review process all interested
stakeholders will have numerous opportunities to present their views
and recommendations with respect to the need for and impact of a
proposed facility. Those opportunities include participating during the
applicant's outreach activities, during the Commission's NEPA process
during both the pre-filing and application processes, and through the
Commission's intervention and protest procedures during the application
process. Numerous commenters raise concerns about their ability to
participate in the pre-filing and application processes.
    75. Reinhardts state that the Participation Plan should include
information of how interested persons may be notified of dates and
times for public meetings or hearings on the proposed project. Star
Group (Star) states that the Participation Plan should identify the
means by which stakeholders will be given the opportunity to meet with
the applicant to attempt to understand and resolve key issues. American
Transmission believes the Commission should give more guidance
concerning what constitutes a complete Participation Plan. Old Dominion
requests that the Commission require the applicants provide a summary
of stakeholder participation to date in the Participation Plan,
including concerns expressed by stakeholders, and efforts by the
applicant to address those concerns.
    76. The Commission expects that the applicant will have conducted
outreach activities at the planning and/or State level prior to
commencing the Commission's pre-filing process. The Participation Plan
must detail all of the outreach activities the applicant has done to
date and summarize the input it received during that outreach. It also
must include a list and schedule of all pre-filing and application
activities the applicant is planning, including, among other things,
consultations, information gathering, and proposed location(s) and

date(s) for the meetings. The applicant must also describe how it
intends to keep the stakeholders apprised of any updates to its
Participation Plan, including, but not limited to, postings to its
project Web site and how the stakeholder can reach the company's
contact to seek additional information.
    77. Parks Association and DOI request that the Commission require
applicants to release a pre-route proposal before the pre-filing
process begins for a permit. One of the purposes of the pre-filing
process is for Commission staff to work with the applicant and
interested stakeholders to determine the ultimate route of the proposed
project. Moreover, for siting proceedings that are initiated in a State
proceeding, stakeholders will already have some idea of the approximate
route from that proceeding. The Commission does not believe it is
necessary to add yet another level of notification to an already
potentially lengthy process.
    78. PSE&G and Allegheny request that the Commission establish a
docketed, publicly-noticed proceeding for pre-filing or use a technical
conference to assure that stakeholders will be afforded a formal
opportunity to present their views. New Jersey Board of Public
Utilities (New Jersey BPU) requests that the Commission provide for
videoconferencing of the meetings. Old Dominion states that the
Commission should not only fix the time by which interventions are due,
but also provide a fixed time for interested parties to file comments
or protests to applications. Communities, Old Dominion, and Star are
concerned that the pre-filing process does not provide an opportunity
to give any meaningful input to the Commission. Communities argue that
without notice and comment during the pre-filing process or
transparency in the Commission's decision-making process, intervenors
and the public will be significantly handicapped in their efforts to
meaningfully participate once the formal application process begins.
They are also concerned that interested parties and the public will not
have any intervention rights or any comment rights during the pre-
filing process.
    79. The Commission's pre-filing procedures offer numerous occasions
for stakeholders to express their interests and make meaningful
contributions. Once the Commission commences the pre-filing proceeding,
it will assign a docket number to the project. All the applicant's pre-
filing materials will be posted under that docket number in the
Commission's eLibrary and will be available through the Commission's
Web site. All subsequent filings made in that docket by the applicant,
any comments filed by stakeholders in that docket, and any issuances
made by the Commission in that docket, including notices and requests
for additional information will be posted on eLibrary under that docket
number.\25\
---------------------------------------------------------------------------

    \25\ Information concerning how to use the Commission's services
can be found on the Commission's Web site at http://www.ferc.gov and

will also be included in the notices the Commission issues
concerning the proposed project.
---------------------------------------------------------------------------

    80. Once the Commission staff establishes that the applicant has
filed sufficient preliminary information to proceed with pre-filing,
the Commission will issue a notice of intent (NOI) to prepare an
environmental document. The NOI will describe the project, list
potential issues identified by the Commission staff,\26\ and explain
the Commission's scoping and environmental review process. It will
explain how to participate in the Commission's process by submitting
written comments. The notice will set a date by which time the comments
will be due. It will also list the scoping meetings the Commission
staff will hold at various locations throughout the proposed project
route to access the maximum amount of participation possible. The
Commission will have a transcriber at its scoping meeting to create a
record of the comments received at that meeting.
---------------------------------------------------------------------------

    \26\ The list of issues may be modified during the environmental
review process based on the comments received during the Commission
staff's analysis.
---------------------------------------------------------------------------

    81. Depending on the issues that arise during the course of pre-
filing, Commission staff may determine that it is necessary to hold
various technical conferences or other meetings to acquire additional
input and information concerning the proposed project. The Commission
will issue notices of these meetings in the docket number assigned to
the project. Additionally, the applicant will need to update its
Participation Plan to reflect any additional outreach that may be
conducted as part of the Commission's review process. If the Commission
determines it is appropriate, it could arrange to provide for
videoconferencing of certain meetings. However, because the Commission
conducts various meetings along the route of the proposed project,
videoconferencing should not be necessary. Additionally, transcripts of
the meeting will be available under the assigned docket in eLibrary and
the Commission's Web site.
    82. AEP is concerned that there is no limit on stakeholder input in
the pre-filing process. It states that stakeholders can push for
revisions and continue to ask questions, which continue to postpone a
project. AEP recommends that the process should be modeled more like a
rulemaking with time-limited input. EEI asserts that the applicant
should not necessarily be obligated to communicate with parties that
have not demonstrated that they will be impacted by the proposed
project. Southern states that the obligation to entertain requests for
information should be limited in scope and in terms of the participants
that may request additional information or else it would lead to
significant delays.
    83. During pre-filing, the Commission will solicit comments from
stakeholders. Any notice issued by the Commission soliciting comments
will include a deadline date for those comments. The Commission expects
that the applicant will address stakeholder concerns in various ways.
Under Sec.  50.4(a)(1), the applicant is required to have a point of
contact within the company to answer general inquiries that may arise.
The applicant can also establish a link on the project Web site that
addresses frequently asked questions and refer the inquiry to that link
or other areas on the Web site to address inquiries, as appropriate.
    84. Based on the comments received in response to the NOI and
information gathered on visits to the site of the proposed project,
Commission staff will work with the applicant to compile the
information and conduct the studies necessary for the Commission staff
to prepare a draft environmental document. Once the Director of OEP has
determined that sufficient information has been gathered for the
Commission to proceed with the final review of the applicant's proposed
project, pre-filing will end and the applicant will file an
application.
    85. Once the application is filed, it will be noticed and
interested entities and individuals will be able to file to intervene
and become a party to the proceeding under Subpart B of Part 385 of the
Commission's regulations. Instructions on how to do this will be
explained in the notice of the application and are available on the
Commission's Web site.
    86. American Transmission requests that the Commission allow State,
local, and regional planning and siting entities to participate in the
proceeding as a matter of right. Communities state that local counties
that will be impacted by the proposed facilities should have automatic
rights to intervene and receive notices and information. NRECA contends
that the Commission should coordinate closely with the Rural Utilities
Service to avoid duplication

and the imposition of additional burdens on applicants.\27\
---------------------------------------------------------------------------

    \27\ The Rural Utilities Service provides capital to upgrade,
expand, maintain, and replace America's vast rural electric
infrastructure. NRECA states that financing obtained through the
Rural Utilities Service is subject to rigorous long-term planning
obligations that are substantially more demanding than the resource
adequacy requirements that apply to other LSEs.
---------------------------------------------------------------------------

    87. Under Sec.  385.214 of the Commission's regulations, any State
commission, Advisory Council on Historical Preservation, the U.S.
Departments of Agriculture, Commerce, and the Interior, any State fish
and wildlife, water quality certification, or water rights agency, or
Indian tribe with authorization to issue a water quality certification
is a party to any proceeding upon filing a notice of intervention in
that proceeding. The Commission sees no reason to expand this
regulation. All other interested persons may seek intervention by
filing a motion to intervene.
    88. DOI raises several issues pertaining to the timing of the draft
environmental document under the NEPA. Specifically, it is concerned as
to when other Federal agencies will get an opportunity to review the
draft document. It encourages the Commission to include a timeframe for
public review of the NEPA document along with clarification as to when
the Commission will issue the NEPA document. After the application is
filed, the Commission will issue a draft environmental document, on
which interested stakeholders will be able to comment. All comments
received will be addressed in the final environmental document which
will be completed before the Commission issues an order on the merits
of the application.
    89. When the Commission completes its review of the application, it
will issue an order addressing the issues raised in the proceeding and
issuing, or denying, a permit to construct the proposed facilities.
Under FPA section 313(a) and Sec.  385.713 of the Commission's
regulations, any party may file a request for rehearing. Requests for
rehearing must include the information required under Sec.  385.719(c)
of the Commission's regulations. The Commission will issue an order
addressing the issues raised in the rehearing requests. If the
Commission denies the rehearing requests, any party who intervened in
the proceeding and is aggrieved by the Commission's order may file,
under FPA section 313(b), an appeal in the United States Court of
Appeals.

D. Pre-Filing

    90. The purpose of the pre-filing process is to facilitate maximum
participation from all stakeholders to provide them with an opportunity
to present their views and recommendations with respect to the need for
and impact of the facilities early on in the planning stages of the
proposed facilities as required under FPA section 216(d). In addition
to gathering stakeholder input, during this time Commission staff will
work with the applicant to compile the information required for a
complete application under Sec. Sec.  50.6 and 50.7.
    91. The filing requirements in Sec. Sec.  50.6 and 50.7 set forth
the basic information that the Commission will need for a generic
project. However, each project will have its own unique issues that
will need to be considered on a case-by-case basis. For example, an
electric transmission facility constructed through farmland will have a
different impact than one that will go through a heavily populated
area. During the pre-filing process, Commission staff will initiate its
independent environmental analysis of the project as required by NEPA.
It will conduct scoping meetings and site visits. Staff will use the
information gathered through this process and from information acquired
from stakeholder input to define the issues particular to a specific
project. Based on these activities, Commission staff assists the
applicant in compiling the information necessary for the Commission to
address the specific concerns raised by the proposed project during the
application process.
1. Initial Consultation Issues
    92. Section 50.5(b) requires that an applicant meet with the
Director of OEP before filing its pre-filing materials. During the
consultation process, Commission staff will review the applicant's
proposed project description, including the status of the applicant's
progress towards collecting the data needed to commence the pre-filing
process, and any preliminary contacts the applicant has had with
stakeholders, including its progress in DOE's pre-application process
and in the State proceeding, if applicable.
    93. Commission staff will review the applicant's eligibility for
Commission jurisdiction for a permit for the proposed facility, outline
the pre-filing process, and provide guidance as to what further work is
necessary to prepare the pre-filing request. Commission staff will also
review the proposed project to determine if the applicant will be
required to hire a third-party contractor to assist in preparing a NEPA
document under the direction of the Commission staff.
    94. Virginia Electric requests that the Commission explain what
will be reviewed by staff in the initial consultation and when such
reviews will take place. American Transmission requests that the
Commission define what constitutes a complete set of pre-filing
information to assist in expediting the process.
    95. While any applicant may seek guidance on a potential project
from Commission staff at any time, the Commission expects that the
applicant will commence the initial consultation process for pre-filing
when it believes that there is sufficient evidence that a proposed
project will be subject to the Commission's jurisdiction and it has
prepared the required pre-filing information. At the pre-filing
consultation, Commission staff will review the applicant's specific
project and the information the applicant has compiled to date and
discuss how that information complies with the initial pre-filing
filing requirements in Sec.  50.5(e) and the application filing
requirements in Sec. Sec.  50.6 and 50.7. Commission staff will also
review what work the applicant has done at the State level, the amount
of community outreach the applicant has conducted, and the results of
that outreach.
    96. While the potential differences between projects make it
difficult for the Commission to specifically define what would
constitute complete pre-filing information, Sec.  50.5(e) lists the
minimum filing requirements that are needed for an applicant to
commence the pre-filing process. If the Commission staff find that the
applicant has sufficient information to comply with the pre-filing
filing requirements in Sec.  50.5(e), the applicant will be allowed to
commence pre-filing. If the applicant does not have sufficient
information to meet the pre-filing filing requirements, Commission
staff will work with the applicant to determine what additional
information will be needed to proceed. If the applicant does not have
the necessary information, it may take more than one pre-filing
consultation before the applicant is prepared to commence pre-filing.
    97. EEI argues that rather than requiring applicants to develop and
implement an extensive new pre-filing public Participation Plan, the
Commission should simply require the applicant to provide appropriate
notification to stakeholders that the venue for the siting approval
process has moved from the State to the Federal level along with an
explanation of how

they can become involved in the Commission's process as an intervenor
or under NEPA. SDG&E recommends that an applicant should be able to
bypass the pre-filing stage, if at the initial consultation with the
Director of OEP it is determined that it has submitted sufficient
information with OEP to support beginning to process the application,
has submitted a Participation Plan, and has complied with the pre-
filing requirements of Sec.  50.5(e). PHI Companies similarly suggest
the pre-filing process should be optional.
    98. Because pre-filing is a fact-finding process used by the
Commission staff to commence and initiate its independent environmental
analysis and to define specific issues raised by specific projects, it
is not possible for an applicant to by-pass the process. However, the
time it takes for an applicant to complete the pre-filing process could
be significantly reduced depending on the amount of work the applicant
had completed in compiling the necessary information prior to the pre-
filing process.
    99. PJM requests that the Commission staff commence its system
analysis review of the proposed facilities during the pre-filing
process. Commission staff primarily focuses on compiling the
information for the subsequent environmental review during pre-filing.
In cases where a project would be located in the geographic area
covered by an RTO, we expect much of the information for the system
analysis to be developed in consultation with the RTO during the pre-
filing phase. If necessary, however, Commission staff will work with
the applicant during pre-filing to identify specific information that
will be required for the Commission to conduct a system analysis during
the application process.
2. Third-Party Contractors
    100. Under Sec.  50.5(c)(6) the applicant is required to propose at
least three third-party NEPA contractors for the Commission to consider
for the proposed project. Under Sec.  50.5(d)(1), the Director of OEP's
pre-filing notice will designate the chosen third-party contractor at
the beginning of the pre-filing process.
    101. Southern states that the applicant should be entitled to
select any third-party NEPA contractor to use in its pre-filing and
application process, insofar as the Director of OEP determines that a
third-party contractor will be necessary. Similarly, National Grid
states that an applicant should be permitted to express a preference
for a particular contractor and the Commission's staff should generally
defer to the applicant's choice because the applicant is financially
responsible for the contractor's work. Los Angeles DWP is concerned
that the requirement to finalize the contract with the third-party
contractor may take 90 days or longer unless one of the four NEPA
contractors selected who is currently under contract with the Los
Angeles DWP. American Transmission requests that the Commission clarify
why it requires that third party contracts be finalized in two weeks in
all cases; instead it recommends that it should be 45 days. DOI
requests clarification or a reference to the criteria that the
Commission will use to determine if a third-party contractor must be
hired.
    102. The Commission is required under NEPA to do an independent
analysis of the environmental impacts of a proposed project. Depending
on the amount of work involved, it often requires that the applicant
hire a third-party contractor to assist the Commission in analyzing the
proposed project. The third-party contractor, while paid for by the
applicant, reports directly to Commission staff. Thus, the Director of
OEP will designate the appropriate third-party contractor.\28\ While
Sec.  50.5(e)(2) requires that the applicant finalize the contract with
the selected third-party contractor within 14 days the Commission may
waive that requirement rule for good cause. If the applicant cannot
finalize the contract with the third-party contractor within two weeks,
it can request a waiver of the requirement of Sec.  50.5(e)(2). We
note, however, that preparation of an environmental document is a time
and labor intensive process. The Commission has implemented the 14-day
requirement as a way to expedite the process.
---------------------------------------------------------------------------

    \28\ See 40 CFR 1506.5(c), requiring that a contractor used to
prepare an environmental impact statement is to be chosen solely by
the lead agency (or where appropriate, by a cooperating agency).
---------------------------------------------------------------------------

3. Subsequent Filing Requirements
    103. Section 50.5(e) lists the initial filing requirements and
filing deadlines that are required for the Commission staff to commence
the pre-filing process. Parks Associations is concerned that this
language does not impose strict deadlines to protect the public
interest. On the other hand, National Grid requests that the Commission
permit reasonable extensions of time beyond the 60-day timeframe for
submitting resource reports.
    104. The deadline requirements in the regulations are intended by
the Commission to expedite the pre-filing process. Since part of the
pre-filing process is to assist the applicant in compiling the
information needed to file a complete application, the Commission does
not expect that the preliminary resource reports filed at the beginning
of the pre-filing process will contain every detail required for the
ultimate report that will need to be filed with the application. The
resource reports required in Sec.  50.5(e)(7) should be preliminary
reports that contain sufficient information for Commission staff to
commence the pre-filing process and specifically the NEPA process.
Commission staff will work with the applicant throughout the pre-filing
process to develop all the necessary information for each resource
report. It should be noted, however, that delays in filing these
materials may delay the decision to allow an application to be filed.
4. Lead Agency Issues/Coordinating Federal Permits
    105. Effective May 16, 2006, DOE delegated paragraphs (2), (3),
(4)(A)-(B), and (5) of FPA section 216(h) to the Commission as they
apply to proposed facilities in designated national interest electric
transmission corridors.\29\ Specifically, it delegated lead agency
responsibilities for the purpose of coordinating all applicable Federal
authorizations and related environmental review and preparing a single
environmental review document for facilities in a National Corridor.
---------------------------------------------------------------------------

    \29\ Supra note 5.
---------------------------------------------------------------------------

    106. PJM states that the Final Rule should promote coordination
among Federal agencies and the resolution of disputes among Federal
agencies. AEP states that while the Commission developed well-defined
procedures for interacting with State agencies, it should also
coordinate siting for the various Federal agencies. DOI requests
clarification on whether there are two separate pre-filing processes
(one led by DOE and one led by the Commission). Western Energy Board
raises similar concerns regarding the duplication of the two processes.
    107. As stated, several Federal agencies including DOE and the
Commission entered into a MOU to establish a framework for early
cooperation and participation that will enhance coordination of all
applicable land use authorizations, related environmental, cultural,
and historic preservation reviews, and any other approvals that may be
required under Federal law in order to site electric transmission
facilities. The MOU requires participating agencies, to the

extent practicable, to commit to early involvement and cooperation to
ensure that timely decisions are made and that the responsibilities of
each agency are met. The Commission intends to work with DOE and the
participating agencies to ensure that all Federal permit decisions are
rendered in a timely manner.
    108. National Grid states that the Commission should request that
DOE delegate lead agency status to the Commission at the time the
Commission's pre-filing process begins rather than at the filing of an
application. Virginia Electric states that the Commission should try to
amend its delegated authority to transfer DOE's pre-application
coordination to the Commission or coordinate and use DOE's pre-
application process to the maximum extent practicable as its own pre-
filing process. It contends that anything else may require the
applicant to duplicate its agency review activities with the Commission
and DOE. EEI requests that the Commission explain the timing and
coordination of its lead agency authority with DOE and clarify that
filing requirements from permitting agencies be relevant, and
preferably significant.
    109. We anticipate working closely with DOE and other Federal
agencies under the terms of the DOE MOU to coordinate all Federal
actions and to ensure that DOE's and Commission's processes interact
seamlessly and with as little duplication of effort as possible. We
expect that we will coordinate with DOE on an ongoing basis on general
issues regarding these matters, as well as on specific cases. In light
of this, we see no need to seek amendment of DOE's delegation order.
    110. Progress contends that the Commission should exercise lead
agency authority in circumstances where Federal agencies are impeding
the construction of new transmission facilities regardless of whether
the State still has jurisdiction or if it is outside a National
Corridor. California PUC similarly urges the Commission to use its lead
agency authority to get Federal agencies to expeditiously review
applications during the time an application is filed at the State
level. PSE&G encourages the Commission not to overstep its statutory
authority in this regard.
    111. Under DOE's May 17, 2006 delegation order, the Commission is
responsible for acting as lead agency when an applicant has submitted
an application to the Commission to construct or modify electric
transmission facilities. Thus, the Commission's lead agency delegated
authority only pertains to facilities subject to the Commission's
jurisdiction in National Corridors. DOE retains lead agency authority
for coordinating Federal action on facilities not subject to the
Commission's delegated authority.
5. Timeframe for Pre-Filing
    112. Because of the potential for differences between projects, the
Commission does not propose to set exact timeframes for the pre-filing
process. The timeframe will depend upon, among other things, the size
of the project, stakeholder participation, the applicant's
preparedness, and the applicant's progress at the State level. The
Commission expects that the pre-filing process for large, multistate
``greenfield'' projects, will take longer than the pre-filing process
for minor modifications to existing facilities.\30\ The Commission
anticipates that the pre-filing process for extensive projects may take
a year to complete. Additionally, the environmental resource reports
required under Sec.  380.16, discussed below, will require
comprehensive field work to compile the information necessary to comply
with the Commission's obligations under NEPA.
---------------------------------------------------------------------------

    \30\ Greenfield facilities are facilities that primarily will be
located in new rights-of-way.
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    113. Southern states that the Commission should acknowledge that
the time required for processing applications will vary and that the
Commission may also lack authority to require any deadline is met.
American Transmission states that the Commission should create a
definitive timeline for the submission of information and for the
receipt of responsive action by Commission staff. DOI also urges the
Commission to establish a chronological timeline to assist applicants
and permitting entities to better understand the timing of steps within
the permitting process. EEI opposes a uniform pre-filing process
schedule. Allegheny states that minor modifications should not require
a full-blown pre-filing process.
    114. Northern Wasco County Peoples Utility District and Seattle
City Light state that since major transmission projects entail long
lead-times for land acquisition, procurement, design/engineering and
construction, they are concerned that the rule may unnecessarily
prolong the amount of time required to take action on project
applications. SDG&E states that the rules should embody the urgency
reflected in the statute that energy security may be at stake due to
delays in transmission siting. EEI requests that the Commission explain
the variables in determining how long the pre-filing and NEPA processes
will take. Allegheny states that a two-year process for authorization
is too long for extensive, reliability-driven transmission projects.
    115. As stated in the NOPR and above, because of the potential
differences between projects, the Commission cannot establish or
predict timeframes for electric transmission projects proceedings. NEPA
requires the Commission to conduct an independent environmental
analysis of a proposed project. The Commission's NEPA analysis may
require a more stringent review of the environmental impacts than is
required at the State level. The pre-filing timeframe is dependent upon
how far along the applicant is on compiling the information needed by
the Commission, the complexity of the project, and what additional
information will be required based on the specific issues raised for
the individual project. The Commission agrees that time is of the
essence in the siting of these facilities. Thus, it believes that it is
incumbent on a project sponsor and States to work together in an
attempt to site the facilities at the State level. This would be the
most expeditious way to site the facilities.
6. Review of Director's Decisions in Pre-Filing
    116. Under Sec.  50.5(f), the Director of OEP will determine when
there is sufficient information for the applicant to file its
application. Old Dominion requests that the Commission provide an
opportunity for stakeholder comment before the OEP Director determines
that the pre-filing process is complete. Allegheny states that since
the Commission had delegated broad authority to OEP, it should provide
potential applicants with an opportunity to seek Commission review of
OEP's decisions. Southern states that the Commission should add a
review process to allow applicants to review and challenge a
determination by the Director of OEP. It claims that an absence of due
process could lead to court challenges. DOI requests that Federal
agencies be consulted prior to the conclusion of the pre-filing
process.
    117. Stakeholders have various opportunities to comment during the
pre-filing process. Therefore, we do not believe it is necessary to add
any additional round of comments. Moreover, once the pre-filing process
is complete, the applicant will be filing an application for Commission
review of the proposed facility which will be noticed and subject to
the Commission's intervention and protest procedures. As

a general matter, the Commission relies on its staff to develop the
record necessary for the Commission to act on energy project
applications, and it does not anticipate entertaining interlocutory
appeals regarding the Director of OEP's pre-filing decisions.

E. Application Requirements

    118. Pennsylvania PUC states that for a more informed process the
Commission should include procedures whereby the application would
publicly disclose what information or data the application has omitted.
Section 50.2(c) requires that the applicant provide all information
required in Part 50 unless it shows that the information is not
necessary. We find that this is sufficient to address the concern
raised by Pennsylvania PUC.
    119. NRECA states that entities seeking permits should be required
to show that all requirements are met, including Federal, State, and
Tribal permitting requirements which would be consistent with the
natural gas regulations. Section 50.2(d) is identical to the
requirement in Sec.  157.5(c) and no further modification is necessary.

F. Filing Requirements

    120. Section 50.6 lists the general requirements that need to be
met when filing an application for a permit. Section 50.6(e) requires
that the applicant demonstrate how its proposed project would satisfy
the requirements of FPA section 216(b)(2) through (6). The Commission
will review this information in addition to the technical information
provided in the Exhibits submitted under Sec.  50.7 in making its
findings concerning the proposed project. As stated, the filing
requirements in Sec. Sec.  50.6 and 50.7 are the basic information that
the Commission will need for a generic project. However, each project
will have its own unique issues that will need to be considered on a
case-by-case basis. An applicant may request a waiver of a specific
requirement if it believes it may not be applicable to its particular
project. Similarly, the Commission may request additional information
if it deems it is necessary to address issues raised by a proposed
project.
    121. Various commenters raised issues concerning the Commission's
need for specific requirements in each of the exhibits. Some requested
that the Commission require additional information. Others question the
Commission's need for some of the required information. Several
commenters request that the Commission accept the record from the State
proceeding to satisfy some of the Commission's filing requirements.
1. State Record
    122. The Commission received numerous comments requesting that it
maximize the use of information, notices, and materials produced during
the State siting process to avoid the costly duplication of
materials.\31\ Specifically, Allegheny states that the Commission
should not require an applicant to notify stakeholders, conduct public
meetings, and submit studies of information that are duplicative of
State commission requirements. PHI Companies contend that, at a
minimum, the Commission should allow for a waiver of various pre-filing
and application steps that the applicant can demonstrate have been
satisfied in the State proceeding. Committees request that the
Commission require that the record already developed for any State
permitting authority be filed and included in the Commission's record.
---------------------------------------------------------------------------

    \31\ Communities, American Public Power, EEI, PHI Companies,
PSE&G, NARUC, Allegheny, SDG&E, National Grid, American
Transmission, SoCal Edison, Pennsylvania PUC, Western Governor's,
Virginia Electric, PPL Electric, and California PUC.
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    123. California PUC states that the Commission should incorporate
the findings from the State siting process into its proceeding. SDG&E
asserts that the Commission should accept the State's environmental
review to the extent it satisfies the requirements of NEPA and to rely
on prior NEPA analysis performed as well. Pennsylvania PSC states that
the Commission should incorporate the work of already existing planning
processes conducted either by regional State organizations or RTOs.
SoCal Edison recommends that the Commission adopt generally applicable
standards for the submission of previously collected materials to
expedite the process. PPL Electric urges the Commission to rely on the
aid of State officials to navigate the State siting procedures.
    124. It is our expectation that by working with States, applicants,
Federal agencies and other stakeholders on an ongoing basis, we will be
able to ensure, to the maximum extent possible, that information
developed in State proceedings can be used, where appropriate, at the
Commission, thereby increasing efficiency and lessening burdens on all
parties.
    125. While the Commission will accept any pertinent information
developed in the State proceeding or elsewhere into its record, the
Commission is required under NEPA to do an independent review of
environmental impacts. The Commission will take all filed information
into consideration as it conducts its review. Similarly, it will
consider the State findings while it considers its own findings under
FPA section 216(b). Its ultimate determination on whether to issue a
permit, however, will be based on the entire record developed in the
Commission proceeding after due consideration of all the issues raised.
2. Exhibits
    126. Section Sec.  50.7 contains the requirements for the exhibits
that must be filed with the application. The exhibits will contain the
technical data needed for the Commission's analysis of the application.
All the environmental data required under Part 380, specifically the
Resource Reports required under Sec.  380.16, will be filed as proposed
Exhibit F. Engineering data and system analysis data must be filed in
Exhibits G and H.
    127. The Massachusetts Energy Board recommends that the Commission
add another exhibit that would require that the applicant submit
construction information including: construction procedures;
construction schedules; plans to coordinate with local authorities;
construction noise impacts and noise mitigation; mitigation of wetland
impacts of construction; plans for mitigation of the traffic impacts of
project construction; and plans to inhibit unauthorized travel on the
right-of-way. These are all required to be filed under the
environmental requirements in Exhibit F or will be addressed in the
Commission environmental analysis. Therefore, additional exhibits are
not necessary.
    128. Affiliated contends that either Sec.  50.6 or Sec.  50.7
should require an exhibit which describes all tribal interests in the
project and outcomes from all Tribal stakeholder participation in the
project pre-filing activities and any issues discussed and whether they
were either resolved or unresolved and details of the resolution or
breakdown in discussions. Tribal governments or agencies are required
to be notified at the beginning of the pre-filing process. In addition,
information concerning tribal interests are required under Sec.
360.16(f) and Sec.  360.16(j). The Commission believes this is
sufficient basic information for the Commission to commence its review
of a proposed project. As stated, each project will raise its own
unique issues for which the Commission may request additional
information if it deems it is necessary to

address particular issues raised by a proposed project. Any information
developed during the pre-filing process will be made part of the record
and will be considered by the Commission as it conducts its substantive
review when an application is subsequently filed.
a. Exhibit E--Maps
    129. Section 50.7(e) states that the format for maps will be
determined during the initial pre-filing consultation. American
Transmission contends that the Commission should use a uniform format
that satisfies other government agencies and avoids redundancy. Because
technology changes over time, the Commission will not specify a
specific format in its regulations. Particular formats will be
addressed during the initial pre-filing consultation. Additionally, a
potential applicant may contact Commission staff at any time for
guidance on the Commission's required formats.
b. Exhibit F--Environmental Requirements
    130. The Commission is required to conduct an environmental
analysis of a proposed electric transmission project under NEPA.
Exhibit F requires that the applicant file the environmental
information required under Part 380 of the Commission's regulations. As
stated, the filing requirements are the basic information that the
Commission will need for a generic project. However, each project will
have its own unique issues that will need to be considered on a case-
by-case basis. At the pre-filing consultation and throughout the pre-
filing process, Commission staff will work with the applicants and
stakeholders to determine the issues that arise for each project.
Depending on those issues, the Commission staff may require additional
information. Conversely, if certain of the filing requirements are not
needed for certain projects, Commission staff will consider whether
waivers are appropriate for those requirements.
    131. Massachusetts Energy Board states that the Commission should
include regulatory procedures for evaluating alternatives to a project,
minimizing environmental impacts, and denying a permit to construct a
project that has significant avoidable adverse impacts. The principal
purposes of the Commission's environmental review are to: (1) Identify
and assess the potential impact on the natural and human environment
that would result from the implementation of a proposed project; (2)
identify and recommend reasonable alternatives, including, as
appropriate, alternatives other than transmission lines, and specific
mitigation measures to avoid or minimize environmental impact; and (3)
encourage and facilitate public involvement in the environmental review
process. During the application process, the Commission will review the
analysis created in the environmental document in concert with the
other information analyzed during its review process to determine if it
is in the public interest to issue a permit to construct the
facilities. If it determines that it is not, it will deny the
application.
    132. Reinhardts state that the Commission should broaden its rules
and its area of inquiry to reasonably justify whether one State or
region should suffer the significant environmental and aesthetic
burdens associated with large transmission infrastructure to bring
economic benefit and pollution reduction to another. The Commission's
mandate under the FPA is to determine if the proposed facility is
consistent with the public interest on a national level. It may be that
a transmission facility will cross several States in order to benefit
consumers in other States. The fact that the facility may not benefit
the State's crossed by the facility is not determinative on the
Commission's decision if the facility benefits a broader region.
    133. Communities state that the applicant should be required to
demonstrate a good faith attempt to negotiate access, and if access is
denied, provide thorough research of all available documentation
regarding the property. The Commission expects that the applicant will
attempt to negotiate access to as much of the proposed right-of-way as
possible for survey purposes. It is in landowners' best interests to
allow the applicant access and to get involved in the pre-filing
process to have input in the ultimate alignment of the proposed
facility. During the pre-filing and application processes, there is
more flexibility to achieving shifts in alignment of the proposed
facility to accommodate individual landowner needs on their property.
i. Section 380.5--Actions That Require EAs
    134. Section 380.5 (b)(14) provides that under certain
circumstances the Commission may prepare an environmental assessment
(EA) instead of an environmental impact statement (EIS) for a proposed
project. American Transmission seeks clarification on whether the
Commission will allow applicants the option of preparing a preliminary
applicant-prepared environmental assessment. The Commission will decide
if an EA or EIS is applicable for a proposed project. If the Commission
determines that an EA is appropriate, the Commission will accept an
applicant-prepared preliminary draft. After reviewing the draft, the
Commission may still require a third-party contractor to assist with
finalizing the draft NEPA document.
ii. Section 380.6--Actions That Require EISs
    135. Section 380.6 requires that an EIS be prepared for major
electric transmission facilities using a right-of-way in which there is
no existing facility.\32\ Affiliated proposes that the Commission also
add ``for which there are likely to be endangered species impacted,
substantial issues under the National Preservation Act, or a
significant impact to the natural or human environment.'' The
Commission will require an EIS for these and several other reasons. The
decision on what needs to be addressed in the EIS generally is
determined on a case-by-case basis based on the information compiled
during the pre-filing process. We do not believe it is appropriate to
add language that could be interpreted to limit the Commission's
discretion to prepare an EIS.
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    \32\ Section 380.6 also lists when EISs are required for natural
gas pipelines and hydroelectric projects. AEP requests that the
Commission eliminate the references to pipeline projects. Those
sections were added to assure the proper placement of the semicolons
and the word ``and''. They have no other purpose relative to
electric transmission siting.
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    136. Virginia Electric contends that the Commission should delete
the ``major'' before ``transmission facilities'' in Sec.  380.6 because
FPA section 216 confers jurisdiction to the Commission over all
electric transmission facilities. The word major in Sec.  380.6 denotes
when the Commission will prepare an EIS under Sec.  380.6 as opposed to
an EA under Sec.  380.5. The Commission will still review all proposals
for electric transmission facilities under its FPA jurisdiction.
iii. Section 380.10--Participation in Commission Proceeding
    137. In Sec.  380.10(a)(2)(iii), the Commission clarified that
interventions should not be filed in natural gas pre-filing proceedings
and in the proposed electric transmission pre-filing proceedings. Old
Dominion points out that while interested parties cannot intervene in
the pre-filing phase, they can submit comments. New Jersey BPU states
that this section should reference the stakeholder participation
provided in Sec. Sec.  50.4 and 50.5 to clarify that

stakeholders have the right to be involved in the process.
    Section 380.10(a)(2)(iii) already refers back to the pre-filing
activities under Sec.  50.5. We do not believe any further reference to
that section is necessary.
iv. Resource Report 1--General Requirements
    138. Resource Report 1 requires that the applicant describe, among
other things, the facilities associated with the project, special
construction and operation procedures, and construction timetables.
National Grid contends that whether a project is going to be built in
an existing right-of-way should dictate the amount and type of data
needed on construction methods, workspace, and related matters. As
stated, specific projects will be considered on a case-by-case basis.
Projects constructed in an existing right-of-way will raise different
issues than a greenfield facility.
    139. Section 380.16(c)(2)(i), requires maps and photos covering at
least a one-half mile wide corridor centered on the electric
transmission facility centerline. Communities contend that a fair
definition of the area of impact should begin with a minimum of one-
half mile and require an evaluation of the extent beyond that point for
each type of impact. National Grid states that the map and photos
should be consistent with the State's corridor requirements. The
Commission uses the one-half mile distance as a generally acceptable
distance for its map requirements. On a case-by-case basis, it will
determine the extent of the area of impact based on the specific
information gathered during the review process.
    140. Section 380.16(c)(2)(i) requires United States Geological
Survey (USGS) 7.5-minutes series topographic maps or maps of equivalent
detail. The Massachusetts Energy Board contends that these maps are not
adequate for a detailed evaluation of impacts in densely populated
areas and requests a better resolution of detail than USGS-based maps.
We agree that the impact of a proposed facility in a densely populated
area will raise different issues than a facility located in a rural
area. The Commission will address the issues, as necessary, in each
individual proceeding before the Commission.
    141. The Center for Biological Diversity requests that the general
content requirement include a full lifecycle assessment and air quality
and greenhouse gas emissions. It contends that the Commission's NEPA
analyses must address the full lifecycle of electric generation and
include analysis, mitigation measures, and alternatives that address
air quality impacts, energy losses, criteria pollutants, and greenhouse
gas emissions. The Commission will review these impacts of the proposed
facilities, as required by NEPA and all other relevant environmental
laws.
v. Resource Report 2--Water Use and Quality
    142. Section 380.16(d) requires that the applicant describe water
quality and provide data sufficient to determine the expected impact of
the project and effectiveness of mitigation, enhancement, or protective
measures. DOI urges the Commission to review the regional impact from
local water use. EEI states that the requirement that the applicant
identify known public and private groundwater supply wells or springs
is inappropriate for above-ground facilities. AEP contends that the
Commission should eliminate this requirement because it only pertains
to pipeline projects. National Grid states that the Commission should
grant requests for waiver for this report for overhead electric
transmission projects where no water use or quality effects would
occur.
    143. The construction of electric transmission facilities will
create ground disturbance that may disrupt groundwater in the area of
the construction. Thus, the Commission will require that the applicant
comply with the requirements of this section.
vi. Resource Report 3--Fish, Wildlife, and Vegetation
    144. Section 360.16(e) requires that the applicant file information
describing aquatic life, wildlife, and vegetation in the vicinity of
the proposed project. Massachusetts Energy Board requests that the
Commission require applicants to provide habitat information obtained
from State natural heritage officials. Section 360.16 (e)(8) requires
that applicants include correspondence from, among others, State fish
and wildlife agencies. We believe this is sufficient to address
Massachusetts Energy Board's concern.
    145. DOI requests that the applicant identify Federal- and State-
listed threatened or endangered species in the project area and the
impacts to such species in this report. It also requests the section be
expanded to require mitigation for invasive species. Sections
360.16(e)(4) and (5) require that the applicant address specific areas
of significant habitats or communities of species of special concern to
the Federal- and State-listed or proposed threatened or endangered
species or critical habitat, respectively.
vii. Resource Report 4--Cultural Resources
    146. Section 360.16(f) requires that the applicant file the
information needed for the Commission to determine that it has complied
with the requirements of the National Historic Preservation Act (NHPA).
Wilderness states that Resource Report 4 should explicitly state that
the project must comply with section 106 of the NHPA. DOI requests that
the report should be expanded to cover nationally and regionally
significant historical and cultural resources. It also believes the
report should cover the potential construction impacts on archeological
sites which may be present in the identified project site.
    147. Resource Report 4 is specifically designed to gather all the
information necessary for the Commission to comply with NHPA section
106. We do not believe it is necessary to specifically state this in
the list of information that the Commission requires the applicant to
file. Resource Report 4 requires that the applicant provide the
information requested by DOI. Moreover, the Commission's environmental
review document will cover the potential impacts on the identified
sites.
    148. Communities state that there is no valid reason for allowing
the delay in the filing of certain reports until immediately before the