145 FERC ¶ 61,134

UNITED STATES OF AMERICA

FEDERAL ENERGY REGULATORY COMMISSION

18 CFR Parts 38 and 284

[Docket No. RM13-17-000; Order No. 787]

Communication of Operational Information Between Natural Gas Pipelines and Electric 

Transmission Operators

AGENCY: Federal Energy Regulatory Commission.

ACTION: Final rule.

SUMMARY: In this Final Rule, the Federal Energy Regulatory Commission 

(Commission) amends the Commission’s regulations to provide explicit authority to 

interstate natural gas pipelines and public utilities that own, operate, or control facilities 

used for the transmission of electric energy in interstate commerce to share non-public, 

operational information with each other for the purpose of promoting reliable service or 

operational planning on either the public utility’s or pipeline’s system. The revised 

regulations will help maintain the reliability of pipeline and public utility transmission 

service by permitting transmission operators to share information with each other that 

they deem necessary to promote the reliability and integrity of their systems. The Final 

Rule adopts the regulations proposed in the Notice of Proposed Rulemaking without 

modification.
Docket No. RM13-17-000 - 2 -

EFFECTIVE DATE: This rule will become effective [insert date 30 days after 

publication in the FEDERAL REGISTER]. The incorporation by reference of certain 

publications in this rule is approved by the Director of the Federal Register as of [insert 

date 30 days after publication in the FEDERAL REGISTER].

FOR FURTHER INFORMATION CONTACT:

Caroline Daly (Technical Information)

Office of Energy Policy & Innovation

888 First Street, NE

Washington, DC 20426

(202) 502-8931

caroline.daly@ferc.gov

Anna Fernandez (Legal Information)

Office of the General Counsel

888 First Street, NE

Washington, DC 20426

(202) 502-6682

anna.fernandez@ferc.gov

SUPPLEMENTARY INFORMATION:
UNITED STATES OF AMERICA

FEDERAL ENERGY REGULATORY COMMISSION

Communication of Operational Information Between 

Natural Gas Pipelines and Electric Transmission 

Operators

Docket No. RM13-17-000

ORDER NO. 787

TABLE OF CONTENTS

Paragraph Numbers

I. Introduction ............................................................................................................................2.

A. Background ......................................................................................................................2.

B. NOPR ...............................................................................................................................5.

II. Discussion .............................................................................................................................7.

A. Need For the Rule ............................................................................................................18.

1. NOPR............................................................................................................................18.

2. Comments ....................................................................................................................20.

3. Commission Determination..........................................................................................27.

B. Scope of Information........................................................................................................33.

1. NOPR............................................................................................................................33.

2. Comments ....................................................................................................................35.

3. Commission Determination..........................................................................................41.

C. Entities Covered Under the Rule......................................................................................46.

1. NOPR ...........................................................................................................................46.

2. Comments.....................................................................................................................49.

3. Commission Determination..........................................................................................56.

D. The No-Conduit Rule and Competitive Concerns...........................................................60.

1. NOPR............................................................................................................................60.

2. Adequacy of No-Conduit Rule to Protect against Competitive Harm .........................65.

3. Exceptions to the No-Conduit Rule..............................................................................90.

III. Questions Posed by the Commission ..................................................................................100.

A. Generator to Electric Transmission Operator Communications......................................100.

1. NOPR............................................................................................................................100.

2. Comments ....................................................................................................................101.

3. Commission Determination..........................................................................................105.
Docket No. RM13-17-000 ii

B. Three-Way Communication of Non-Public Operational Information .............................106.

1. NOPR ...........................................................................................................................106.

2. Comments.....................................................................................................................107.

3. Commission Determination..........................................................................................115.

C. Examples of Non-Public Operational Information ..........................................................117.

1. NOPR ...........................................................................................................................117.

2. Comments.....................................................................................................................119.

3. Commission Determination..........................................................................................123.

IV. Clarification Regarding Table-Top Exercises.....................................................................126.

A. NOPR ...............................................................................................................................126.

B. Comments.........................................................................................................................127.

C. Commission Determination..............................................................................................128.

V. Miscellaneous.......................................................................................................................131.

A. Monitoring, Existing Tariff Requirements, Document Destruction ................................131.

1. Comments.....................................................................................................................131.

2. Commission Determination..........................................................................................134.

B. Costs of Information Sharing ...........................................................................................137.

1. Comments.....................................................................................................................137.

2. Commission Determination..........................................................................................138.

C. Implementation.................................................................................................................139.

1. Comments ....................................................................................................................139.

2. Commission Determination..........................................................................................143.

VI. Information Collection Statement .......................................................................................145.

VII. Environmental Analysis.....................................................................................................152.

VIII. Regulatory Flexibility Act ................................................................................................153.

IX. Document Availability ........................................................................................................155.

X. Effective Date and Congressional Notification....................................................................158.
145 FERC ¶ 61,134

UNITED STATES OF AMERICA

FEDERAL ENERGY REGULATORY COMMISSION

Before Commissioners: Jon Wellinghoff, Chairman;

 Philip D. Moeller, John R. Norris,

Cheryl A. LaFleur, and Tony Clark.

Communication of Operational Information Between 

Natural Gas Pipelines and Electric Transmission 

Operators

Docket No. RM13-17-000

ORDER NO. 787

FINAL RULE

(Issued November 15, 2013)

1. In this Final Rule, the Federal Energy Regulatory Commission revises Parts 38 

and 284 of the Commission’s regulations to provide explicit authority to interstate natural 

gas pipelines and public utilities that own, operate, or control facilities used for the 

transmission of electric energy in interstate commerce to share non-public, operational 

information with each other for the purpose of promoting reliable service or operational 

planning on either the public utility’s or pipeline’s system.1

 The revised regulations will 

help maintain the reliability of pipeline and public utility transmission service by 

permitting transmission operators to share information with each other that they deem 

 1 In this Final Rule, the Commission refers to interstate natural gas pipelines and 

public utilities that own, operate, or control facilities used for the transmission of electric 

energy in interstate commerce collectively as “transmission operators.”
Docket No. RM13-17-000 - 2 -

necessary to promote the reliability and integrity of their systems. The Final Rule adopts 

the regulations proposed in the Notice of Proposed Rulemaking without modification.2

I. Introduction

A. Background

2. In recent years, reliance on natural gas as a fuel for electric generation has steadily 

increased.3

 This trend is expected to continue into the future, resulting in greater 

interdependence between the natural gas and electric industries.4

 Several events over the 

 2 Communication of Operational Information Between Natural Gas Pipelines and 

Electric Transmission Operators, 78 FR 44900 (July 25, 2013), FERC Stats. & Regs 

¶ 32,699 (2013) (cross-referenced at144 FERC ¶ 61,043 (2013) (NOPR)).

3 See, e.g., Energy Information Administration, Fuel Competition in Power 

Generation and Elasticities of Substitution (June 2012); Richard Smead, All Industry 

Segments Working for Success in Growing Gas-Fired Generation (Nov. 15, 2012); 

ISO-NE, Addressing Gas Dependence at 3 (July 2012) (reliance on natural gas-fired 

electricity in the region increased from five percent in 1990 to 51 percent in 2011).

4 See, e.g., North American Electric Reliability Corporation, 2013 Special 

Reliability Assessment: Accommodating an Increased Dependence on Natural Gas for 

Electric Power; Phase II: A Vulnerability and Scenario Assessment for the North 

American Bulk Power System at 1 (May 2013) (“Over the past decade, natural gas-fired 

generation rose significantly from 17 percent to 25 percent of U.S. power generation and 

is now the largest fuel source for generation capacity. Gas use is expected to continue to 

increase in the future, both in absolute terms and as a share of total power generation and 

capacity.”), available 

at http://www.nerc.com/pa/RAPA/ra/Reliability%20Assessments%20DL/NERC_PhaseII

_FINAL.pdf; Energy Information Administration, Annual Energy Outlook 2013 Early 

Release Overview (2013) (showing electric generation from natural gas rising from 

13 percent in 1993 to 30 percent in 2040), available 

at http://www.eia.gov/forecasts/aeo/er/early_elecgen.cfm; The New England State 

Committee on Electricity, Natural Gas Infrastructure and Electric Generation: A Review 

of Issues Facing New England (Dec. 14, 2012), available at

http://www.nescoe.com/uploads/Phase_I_Report_12-17-2012_Final.pdf.
Docket No. RM13-17-000 - 3 -

last few years, such as the Southwest Cold Weather Event,5 demonstrate the crucial 

interaction between natural gas pipelines and electric transmission systems and the need 

for robust communication between these industry sectors to ensure that both systems 

operate safely and effectively for the benefit of their customers. 

3. Since February 2012, the Commission has requested comment and conducted 

multiple technical conferences on various aspects of gas-electric interdependence and 

coordination in order to better understand the interface between the electric and natural 

gas pipeline industries and identify areas for improved coordination.6

 In this proceeding, 

the Commission addresses one aspect of gas-electric interdependence and coordination: 

communication and information-sharing between the natural gas and electric industries. 

4. On December 7, 2012, the Commission issued a Notice of Request for Comments 

and Technical Conference regarding information sharing and communication issues 

between the natural gas and electricity industries.7

 In response, natural gas and electric 

industry participants described a variety of actions that are currently being taken to 

 5 See FERC/NERC, Report on Outages and Curtailments During the Southwest 

Cold Weather Event of February 1-5, 2011 (2011), available at

http://www.ferc.gov/legal/staff-reports/08-16-11-report.pdf.

6 The NOPR contains a detailed description of the Commission’s various actions 

on gas-electric coordination and will not be repeated here. 

7 Coordination between Natural Gas and Electricity Markets, Docket No. AD12-

12-000 (Dec. 7, 2012) (Notice of Request for Comments and Technical Conference) 

(http://www.ferc.gov/EventCalendar/Files/20121207134434-AD12-12-000TC1.pdf); 

77 FR 74180 (Dec. 13, 2012) (http://www.gpo.gov/fdsys/pkg/FR-2012-12-13/pdf/2012-

30063.pdf).
Docket No. RM13-17-000 - 4 -

improve communications and information sharing between the two industries. While 

several entities acknowledged that system reliability and contingency planning could be 

further enhanced by the sharing of non-public, operational information directly between 

transmission operators, several transmission operators pointed out that there is general 

reluctance to share such information because of concerns that doing so could be a 

violation of current laws, regulations or tariffs, including the Commission’s prohibition 

on undue discrimination. Accordingly, multiple industry participants requested that, in 

order to facilitate the exchange of information between transmission operators, the 

Commission should more clearly identify the types of operational information that may 

be shared between transmission operators and clarify that the sharing of such information 

does not violate the prohibition against undue discrimination. While electric generators 

generally did not oppose the sharing of such information, they, together with other 

entities, expressed concern about the communication of generator-specific information 

between an electric transmission operator and an interstate natural gas pipeline operator 

without the generator’s knowledge. Some entities also expressed concern regarding the 

potential harm to industry participants from the improper use of commercially sensitive 

information.8

 

 8 A summary of these views was presented in the NOPR, and will not be repeated 

in detail here. See NOPR, FERC Stats. & Regs. ¶ 32,699 at PP 7-9 (cross-referenced at 

144 FERC ¶ 61,043.
Docket No. RM13-17-000 - 5 -

B. NOPR

5. On July 18, 2013, the Commission issued the NOPR, in which it proposed to 

revise Parts 38 and 284 of its regulations to provide explicit authority to interstate natural 

gas pipelines and public utilities that own, operate, or control facilities used for the 

transmission of electric energy in interstate commerce to share non-public, operational 

information with each other for the purpose of promoting reliable service or operational 

planning on either the public utility’s or pipeline’s system. As a protection against the 

disclosure of non-public, operational information, the Commission also proposed a NoConduit Rule that prohibits subsequent disclosure of that information to a marketing 

function employee or to a third party.

6. Comments on the NOPR were due on August 26, 2013. Thirty-three parties filed 

comments. NGSA filed reply comments on September 30, 2013. Comments were 

received from Regional Transmission Organizations and Independent System Operators 

(RTOs/ISOs), electric utilities, interstate natural gas pipelines, LDCs, state regulators, 

generators, and other parties. Of these, 30 supported or did not oppose the NOPR9 and 

 9 American Electric Power Service Corporation (AEP), American Gas Association 

(AGA), American Public Power Association (APPA), Boardwalk Pipeline Partners, LP 

(Boardwalk Pipelines), California Independent Operator (CAISO), Duke Energy 

Corporation (Duke), Edison Electric Institute (EEI), Electric Power Supply Association 

(EPSA), Electricity Consumers Resource Council (ELCON), Enable Interstate Pipelines 

(Enable), International Transmission Company (ITC), Interstate Natural Gas Association 

of America (INGAA), ISO New England Inc. (ISO-NE), ISO/RTO Council (IRC), 

Massachusetts Municipal Wholesale Electric Company (MMWEC), Midcontinent 

Independent System Operator (MISO), National Rural Electric Cooperative Association 

(NRECA), Natural Gas Supply Association (NGSA), New England Natural Gas Industry 

(NE Gas Industry), New England Power Generators Association Inc. (NEPGA), 

(continued...)
Docket No. RM13-17-000 - 6 -

three opposed it.10 In general, most commenters support the proposed rule to help 

promote the reliability and efficiency of the natural gas and electric systems by 

eliminating legal uncertainty regarding the ability of interstate natural gas pipelines and 

electric transmission operators to exchange non-public, operational information. Some 

commenters request that the Commission modify or clarify the proposal in a number of 

respects.

II. Discussion

7. In this Final Rule, the Commission is adopting the NOPR as proposed. The 

Commission is modifying Parts 38 and 284 of the Commission’s regulations to provide 

explicit authority to interstate natural gas pipelines and public utilities that own, operate, 

or control facilities used for the transmission of electric energy in interstate commerce to 

share non-public, operational information with each other for the purpose of promoting 

reliable service or operational planning on either the pipeline’s or public utility’s system. 

The Commission also is adopting a No-Conduit Rule to provide additional protections 

against undue discrimination and ensure that the non-public, operational information 

shared under the rule remains confidential. 

 

New England States Committee on Electricity (NESCOE), New York ISO (NYISO), 

New York Public Service Commission (NYPSC), New York Transmission Owners 

(NYTOs), North American Electric Reliability Corporation (NERC), Pacific Gas and 

Electric Company (PG&E), Process Gas Consumers (PGC), Public Utilities Commission 

of Ohio (PUCO), Tennessee Valley Authority (TVA), Washington Gas Light Company 

(Washington Gas).

10 American Public Gas Association (APGA), Consumers Energy Company 

(Consumers Energy), and New Jersey Board of Public Utilities (NJBPU).
Docket No. RM13-17-000 - 7 -

8. Communications between transmission operators serve a valuable and necessary 

purpose to help ensure reliability on both systems. With the increasing reliance on 

natural gas as a fuel for electric generation, ensuring robust communications between the 

transmission operators in the electric and natural gas industries is valuable to the ability 

of both systems to operate reliably and effectively. Electric transmission operators are 

continuously and near instantaneously balancing supply and demand to ensure the system 

remains in equilibrium.11 In contrast, due to the physical characteristics of interstate 

natural gas pipelines, the pipelines require advance nominations to ensure they have 

sufficient line pack and storage available to meet scheduled daily load of all their 

customers, including the gas-fired generators, which may constitute significant load for a 

pipeline and which generally rely on a just-in-time natural gas supply and pipeline 

delivery. While pipeline line pack and storage provide some operational flexibility to 

pipelines to accommodate load swings throughout the day, short term swings in demand 

by gas-fired electric generators resulting from redispatch by electric transmission 

operators may be difficult to manage, particularly during times of coincident peak loads 

on interstate natural gas pipelines and electric transmission systems, such as during 

unusual cold weather events when end-use customers may rely on both natural gas and 

electricity. Communication between interstate natural gas pipelines and electric 

transmission operators can be invaluable to help ensure that electric transmission

 11 Electric transmission systems currently have limited electric storage capabilities.
Docket No. RM13-17-000 - 8 -

operators maintain grid reliability and that interstate natural gas pipelines can meet 

contractual and operational obligations to all of their shippers.

9. Currently, interstate natural gas pipelines and electric transmission operators share 

non-public information with other transportation or transmission operators. For example, 

interstate natural gas pipeline operators routinely exchange nomination and scheduling 

information with other interstate natural gas pipeline operators and with upstream and 

downstream entities to confirm transportation nomination requests and to coordinate 

flows between the parties.12 Transmitting electric utilities similarly coordinate the 

sharing of non-public interchange schedule information on a routine basis through 

mechanisms such as, for example, e-Tags.13 This coordination helps ensure the safe and 

reliable transmission of electric power across a region. 

 12 The nomination process initiates the flow of gas with the natural gas 

transportation service provider. The natural gas transportation service provider then 

confirms the flow of natural gas with the corresponding upstream and downstream 

entities. Once the natural gas quantities are confirmed, the natural gas transportation 

service provider sends the scheduled quantities information to the shipper. See 18 CFR 

284.12(a)(1)(1), NAESB Nomination Standard 1.3.2 (establishing the standards 

governing pipeline confirmations with upstream and downstream parties).

13 e-Tags are used by applicable Balancing Authorities, Reliability Coordinators, 

Interchange Authorities, Transmission Service Providers, Purchasing-Selling Entities, 

Generator-Providing Entities, and Load-Serving Entities to coordinate interchange 

schedules. See, e.g., NAESB Wholesale Electric Quadrant (WEQ) Business Practice 

Standards (Coordinate Interchange) requirement 004-2 (“Until other means are adopted 

by NAESB, the primary method of submitting the RFI [Request for Interchange] shall be 

an e-Tag communicated to and managed by the Sink BA’s [Balancing Authority] 

registered e-Tag authority service using protocols compliant with the Version 1.8.1 

Electronic Tagging Functional Specification.”) and applicability section ("The 

Coordinate Interchange Business Practice Standards apply to BA [Balancing Authority], 

RC [Reliability Coordinator], IA [Interchange Authority], Transmission Service Provider, 

(continued...)
Docket No. RM13-17-000 - 9 -

10. In Order No. 698, the Commission recognized the need for inter-industry 

communications by adopting industry-developed standards requiring the exchange of 

operational information between the natural gas and electric industries.14 These 

standards require a generator and its directly connected natural gas pipeline(s) to 

“establish procedures to communicate material changes in circumstances that may impact 

hourly flow rates.”15 In addition, these standards ensure that interstate natural gas 

pipelines have relevant planning information to assist in maintaining the operational 

integrity and reliability of pipeline service, as well as to provide gas-fired generator 

operators with information as to whether hourly flow deviations can be honored. NAESB 

Wholesale Electric Quadrant (WEQ) Standard 011-1.6, also incorporated in the 

Commission’s regulations,16 requires that ISOs, RTOs, and other independent system 

 

PSE [Purchasing-Selling Entity], GPE [Generator-Providing Entity], Load-Serving Entity 

[LSE], and any TPSE [a PSE whose transmission approval rights are cited].") NAESB 

WEQ Business Practice Standards (Version 003), published July 31, 2012.

14 Standards for Business Practices for Interstate Natural Gas Pipelines; 

Standards for Business Practices for Public Utilities, Order No. 698, FERC Stats. 

& Regs. ¶ 31,251 (2007), order on clarification and reh’g, Order No. 698-A, 121 FERC 

¶ 61,264 (2007). In Order No. 698, the Commission incorporated by reference NAESB 

WGQ Standard 0.3.12 into its regulations and NAESB WEQ Standard 011.

15 NAESB WGQ Version 2.0 Business Practice Standard 0.3.12. See also 

Standards for Business Practices for Interstate Natural Gas Pipelines, Order No. 587-V, 

FERC Stats. & Regs. ¶ 31,332 (2012) (cross-referenced at 140 FERC ¶ 61,036) (2012), 

(incorporating by reference the Version 2.0 WGQ Business Practice Standards). See also

18 CFR 284.12(a) (2013).

16 18 CFR pt. 38 (2013).
Docket No. RM13-17-000 - 10 -

operators establish written operational communication procedures with an appropriate 

interstate natural gas pipeline to be implemented when an extreme condition occurs. 

11. Sharing of operational information between interstate natural gas pipelines and 

electric transmission operators is akin to the sharing of operational information among 

interconnected parties. Both interstate natural gas pipelines and electric transmission 

operators could benefit from information regarding whether scheduled transactions on the 

others’ systems will be carried out because of the potential effect on reliable service and 

operational planning. In many cases, gas-fired generators do not take natural gas at a 

uniform flow rate over a 24 hour period, and the electric transmission operator may find 

it valuable to know whether the interstate natural gas pipeline will be able to provide a 

non-uniform flow rate to meet the demands on the electric system. By the same token, it 

may be valuable to an interstate natural gas pipeline to know the demands that may be 

placed on its transportation system by gas-fired generators and whether such demands 

may cause a problem with its ability to deliver gas to other customers. Similarly, a 

disruption on an electric transmission line may force the electric transmission operator to 

shut down a gas-fired generator, which could cause increased gas pressure on an 

interstate natural gas pipeline forced to terminate gas deliveries to that generator. 

12. Commenters participating in the Commission staff technical conferences, as well 

as comments to this rulemaking, expressed concern that, without further clarification of 

the ability of interstate natural gas pipelines and electric transmission operators to 

exchange information, necessary communications may not take place. Comments have 

focused on the applicability of both the statutory prohibitions on undue discrimination 
Docket No. RM13-17-000 - 11 -

and the Standards of Conduct. Both interstate natural gas pipelines and electric 

transmission operators have stated that clarification of their ability to exchange nonpublic information would assist them in efficiently and reliably planning the operations of 

their respective systems and addressing emergencies. The Commission provides the 

requested clarification in this Final Rule. Sharing of information valuable to reliable 

operations between transmission operations is not the type of preferential treatment the 

Federal Power Act (FPA) and Natural Gas Act (NGA) are intended to restrict. We find, 

as discussed below, that the FPA and NGA provisions regarding undue discrimination or 

unjust and unreasonable acts and practices do not prevent the exchange of information 

between operators of interstate natural gas pipeline transportation systems and electric 

transmission operators provided for in this Final Rule.

13. Both the FPA and the comparable provisions of the NGA prohibit undue 

discrimination or preference.17 However, FPA section 205(b) and NGA section 4(b) do 

not forbid preferences, advantages and prejudices per se.

18 Rather, FPA section 205(b) 

and NGA section 4(b) prohibit “undue” preferences, advantages and prejudices.19 A

 17 16 U.S.C. 824d(b) (2012); 15 U.S.C. 717c(b) (2012). 

18 See, e.g., Cities of Bethany v. FERC, 727 F.2d 1131, 1139 (D.C. Cir.), cert. 

denied, 469 U.S. 917, 105 S.Ct. 293, 83 L.Ed.2d 229 (1984).

19 See, e.g., Boroughs of Chambersburg v. FERC, 580 F.2d 573, 577 (D.C. Cir. 

1978).
Docket No. RM13-17-000 - 12 -

difference in treatment is not unduly discriminatory when the difference is justified.20 In 

interpreting FPA section 205(b) and NGA section 4(b), the courts have held that 

transmission providers cannot treat similarly situated customers differently21 and that the 

disparate treatment of two customer classes does not in and of itself result in an undue 

preference or advantage or in an unreasonable difference in service if the customer 

classes are not similarly situated.22 Whether a preference is “undue” depends on the 

specific facts of the behavior and the circumstances to determine whether disparities exist 

and whether those disparities are rationally justified.23

14. We find that the sharing of non-public, operational information between public 

utilities that own, operate, or control facilities used for the transmission of electric energy 

in interstate commerce and interstate natural gas pipelines for the purpose of promoting 

reliable service or operational planning is reasonable and not unduly discriminatory or 

preferential. Undue discrimination provisions apply to ensure that similarly situated 

 20 See Metropolitan Edison Co. v. FERC, 595 F.2d 851, 857 (D.C. Cir. 1979). See 

also Transmission Agency of N. California v. FERC, 628 F.3d 538, 549 (D.C. Cir. 2010) 

(citing Ark. Elec. Energy Consumers v. FERC, 290 F.3d 362, 367 (D.C. Cir. 2002) and 

Elec. Consumers Res. Council v. FERC, 747 F.2d 1511, 1515 (D.C. Cir. 1984)).

21 See Transmission Agency of N. California v. FERC, 628 F.3d at 549 (citing 

Sacramento Mun. Util. Dist. v. FERC, 474 F.3d 797, 802 (D.C. Cir. 2007)).

22 See, e.g., Sw. Elec. Coop., Inc. v. FERC, 347 F.3d 975, 981 (D.C. Cir. 

2003). See also Michigan Consolidated Gas Co. v. FPC, 203 F.2d 895, 901 (3d Cir. 

1953) and Complex Consol. Edison Co. of New York, Inc. v. FERC, 165 F.3d 992, 1012 

(D.C. Cir. 1999).

23 See St. Michaels Utilities Comm'n v. Fed. Power Comm'n, 377 F.2d 912, 915 

(4th Cir. 1967). 
Docket No. RM13-17-000 - 13 -

customers are not subject to disparate rates or terms and conditions of service. As noted 

above, transmission operators are not similarly situated to other customers because they 

require access to non-public scheduling and other types of information from a variety of 

sources to help them maintain the reliability and integrity of the transportation and 

transmission systems. In addition, interstate natural gas pipelines are generally not 

wholesale customers of electric transmission operators. Likewise, RTOs/ISOs are not 

shippers on pipelines. Thus, we find that it is appropriate and necessary, with adequate 

safeguards, to expressly permit the sharing of non-public, operational information 

between transmission operators.24

15. To protect against the potential for undue discrimination, the Commission is 

relying on existing safeguards as well as the adoption of a No-Conduit Rule. First, while 

non-public, operational information may be useful for planning, transmission operators 

cannot deviate from the terms of their tariffs, and cannot operate in an unduly 

discriminatory manner.

25 Transmission operators are also subject to the same limitations 

on sharing information with their marketing function employees as provided under the 

 24 The Commission recognizes that some vertically-integrated transmission 

operators may have marketing function employees or affiliates, such as generators or 

local distribution companies that handle gas transactions. The Commission addresses 

concerns infra with respect to potential access and misuse of information shared pursuant 

to this Final Rule in the subsection entitled Adequacy of No-Conduit Rule to Protect 

against Competitive Harm. 

25 See, e.g., ISO New England Inc., 142 FERC ¶ 61,058, at P 23 (2013) (available 

capacity must be dispatched “consistent with the pipeline’s tariff” and “[t]he pipelines are 

required to allocate available capacity on a not unduly discriminatory basis among the 

various requestors of capacity.”).
Docket No. RM13-17-000 - 14 -

Standards of Conduct.26 The Commission’s Standards of Conduct were adopted with 

respect to one aspect of potentially undue discrimination which may occur through 

exchanges of information between transmission providers and their marketing functions 

in certain situations. 

16. Second, the No-Conduit Rule included in the Final Rule will serve as an additional 

safeguard to ensure that transmission operators comply with the prohibitions against 

undue discrimination or preference with respect to their marketing function employees 

and third parties. The No-Conduit Rule prohibits recipients of non-public, operational 

information pursuant to the Final Rule from subsequently disclosing that information to a 

third party or a marketing function employee, as that term is defined in section 358.3(d) 

of the Commission’s regulations. As discussed below, adoption of this No-Conduit Rule 

addresses many of the concerns regarding the sharing of commercially sensitive, 

customer-specific information among transmission operators.27

 26 18 CFR 358.6 and 358.7 (2013).

27 As discussed further below, this No-Conduit Rule applies only to the 

information the interstate natural gas pipeline and electric transmission operator exchange

pursuant to this Final Rule. It does not otherwise affect the ability of interstate natural 

gas pipelines and local distribution companies (LDCs) to exchange operational 

information regarding actual or potential pipeline or distribution system operational 

conditions affecting the gas flow between these physically interconnected parties. Nor

does it affect the ability of an electric transmission operator to share its own information 

with an LDC, if otherwise permitted under its tariff. This Final Rule also does not 

prohibit electric transmission operators from sharing non-public, operational information 

received from a pipeline pursuant to this rule with LDCs, if otherwise provided for in 

tariff provisions approved by the Commission.
Docket No. RM13-17-000 - 15 -

17. Based on the potential need for the exchange of information to promote the 

reliability and operational integrity of the transmission and transportation systems the 

Commission regulates, and the protections against undue discrimination, the Commission 

finds that the exchange of non-public, operational information between transmission 

operators does not violate the statutory prohibitions on undue discrimination or 

preference as discussed herein. As discussed in more detail infra, to the extent that an 

electric transmission operator or interstate natural gas pipeline has a tariff provision 

which precludes a communication that would otherwise be authorized under the Final 

Rule, it will have to make a filing under section 205 of the FPA or section 4 of the NGA 

to revise that tariff provision to allow the exchanges of information permitted by this 

Final Rule. Below, the Commission will address the comments received on the NOPR.

A. Need For the Rule

1. NOPR

18. In the NOPR, the Commission pointed out that, while several entities 

acknowledged that system reliability and contingency planning could be further enhanced 

by the sharing of non-public, operational information directly between transmission 

operators, several transmission operators pointed out that there is general reluctance to 

share such information because of concerns that doing so could be a violation of current 

laws, regulations or tariffs.28 Accordingly, several entities, including interstate natural 

 28 NOPR, FERC Stats. & Regs. ¶ 32,699 at P 7 (cross-referenced at 144 FERC 

¶ 61,043).
Docket No. RM13-17-000 - 16 -

gas pipelines and electric transmission operators, requested that, in order to facilitate the 

exchange of information between transmission operators, the Commission should more 

clearly identify the types of operational information that may be shared between 

transmission operators and clarify that the sharing of such information does not violate 

the prohibition against undue discrimination. 

19. In an effort to provide certainty to the industry and remove barriers –real or 

perceived—to the sharing of non-public, operational information, the Commission 

proposed to revise its regulations to authorize expressly the exchange of non-public, 

operational information between electric transmission operators and interstate natural gas 

pipelines. In consideration of the concerns regarding the exchange of non-public 

operational information, the Commission also proposed to adopt a No-Conduit Rule 

which prohibits recipients of the non-public, operational information from subsequently 

disclosing or being a conduit for subsequently disclosing that information to third parties 

or marketing function employees. 

2. Comments 

20. The large majority of commenters generally support or do not oppose the NOPR. 

Many commenters generally agree that the rule is needed to provide certainty to interstate 

natural gas pipelines and electric transmission operators so that they may exchange 

information needed to promote reliable service and operational planning. They also 

generally support the proposed scope of information that may be shared under the rule, as 

well as the limitations on disclosures of such information via the No-Conduit Rule. 
Docket No. RM13-17-000 - 17 -

21. For example, NERC states that, based on its extensive study of both industries and 

stakeholder discussions with electric and natural gas operators, transmission operators 

could make better informed operating decisions, particularly during seasonal peak 

electric system conditions, if they have the ability to obtain information about interstate 

natural gas pipeline flows and pipeline system conditions.29 NESCOE states that the 

implementation of these revisions in the near-term would provide regions like New 

England with certainty and flexibility to put in place what has the strong potential to be 

an effective and low cost reliability measure.30 INGAA states that the proposed scope of 

information transmission operators may share under the proposed regulations is 

appropriate and provides sufficient flexibility and guidance.31 

22. Three commenters, APGA, Consumers Energy, and NJBPU, oppose the 

Commission’s proposed rulemaking. 

23. As a general matter, APGA believes that the proposed regulations in the NOPR 

open the door to the release of commercially sensitive, non-public information without 

adequate support for such action and without adequate guidelines for such release.32 

First, APGA contends that interstate natural gas pipelines have made clear that they do 

not need additional information to operate reliably and that they already make a 

 29 NERC Comments at 5-6.

30 NESCOE Comments at 7. 31 INGAA Comments at 2.

31 INGAA Comments at 2.

32 APGA Comments at 1.
Docket No. RM13-17-000 - 18 -

significant amount of operational data available to the public on a non-discriminatory 

basis.33 Second, APGA contends that most electric transmission operators are not 

experiencing reliability problems related to inadequate access to non-public, gas-related 

information and that much of the operational data electric transmission operators say they 

would like to have is already publicly available.34 APGA contends that the other data 

electric transmission operators say they would like to have, such as confidential gas 

availability information indicating whether a specific generator can be dispatched 

reliably, is information that the interstate natural gas pipelines simply do not have. 

Third, APGA states that generators may be harmed by secret communications between 

transmission operators regarding whether a given generation facility may or may not have 

adequate gas supplies to operate because interstate natural gas pipelines do not have 

sufficient information to answer that question accurately. APGA argues that, given that 

the record fails to support a finding of a critical need for the exchange of non-public 

information to foster reliability and due to the importance of not permitting the sharing of 

confidential, non-public data absent a showing that such sharing would be beneficial, the 

NOPR should be abandoned.35 

24. Instead, APGA argues that the Commission should conduct a case-by-case 

evaluation of what non-public information specific interstate natural gas pipelines and 

 33 Id. at 4.

34 Id. at 4-5.

35 Id. at 7.
Docket No. RM13-17-000 - 19 -

electric transmission operators may release and under what circumstances, rather than the 

sweeping rule proposed in the NOPR.36 APGA also states that the real issue is the lack 

of interstate natural gas pipeline capacity to meet peak demand from electric generators 

resulting from electric generators’ failure to subscribe to adequate firm transportation 

service.37 

25. Similar to APGA, NJBPU is concerned about the potential for harm to industry 

participants, as well as the potential for improper use of non-public, operational 

information.38 NJBPU does not believe that the Commission’s proposed No-Conduit 

Rule adequately responds to the concerns of NJBPU and various others. NJBPU states 

that, while the proposed No-Conduit Rule may address subsequent disclosure to an 

affiliate or third party, it does not address the problem of abuse, gaming, and market 

manipulation by an initial recipient of non-public, operational information. 

26. Consumers Energy argues that the proposed rule would do little to help ensure 

reliable service.39 Consumers Energy points out that there has never been an attempt to 

incent discussion by or between coal producers, rail or barge transporters under the guise 

of increasing electric transmission reliability. Consumers Energy asserts that 

transmission operators can and will address reliability through the use of tariffs and 

 36 Id. at 8 and 11.

37 Id. at 11 & n.28.

38 NJBPU Comments at 3.

39 Consumers Energy Comments at 3.
Docket No. RM13-17-000 - 20 -

contracts. Consumers Energy believes contractually specified flow rates and nominations 

limitations have provided and can continue to provide the information that is necessary to 

ensure a continued high level of reliability of interstate natural gas pipelines and that this 

will, in turn, ensure a continued high level of reliability of the electric transmission grid.40 

Consumers Energy further contends that RTOs’ resource adequacy-related tariff 

provisions adequately inform them as to the availability of resources under their dispatch. 

Lastly, Consumers Energy states that, rather than permitting the communication of nonpublic, operational information between transmission operators to ensure service 

reliability, the appropriate solution to the problem of ensuring service reliability in the 

face of increased reliance on natural gas as a fuel for electric generation is to recognize 

the true cost of such reliability.41 This, Consumers Energy contends, will serve to 

increase investment in the interstate natural gas pipeline and LDC infrastructure that will 

be needed to serve this expanding load.

3. Commission Determination

27. We conclude that we need to revise our existing regulations to provide greater 

certainty to electric transmission operators and interstate natural gas pipelines regarding 

the permissibility of sharing non-public, operational information, including customerspecific information, for the purpose of promoting reliable service or operational 

planning. As discussed above, the record and the operational realities of the two 

 40 Id. at 4.

41 Id. at 5.
Docket No. RM13-17-000 - 21 -

industries show that the exchange of non-public, operational information would be 

valuable to foster reliability. While interstate natural gas pipelines and electric

transmission operators publicly post a significant amount of important information 

needed by interstate natural gas pipeline shippers and electric transmission customers, 

interstate natural gas pipelines and electric transmission operators need other operational 

information, including non-public information, in order to reliably manage the operations 

of these systems. Interstate natural gas pipelines already provide non-public operational 

information to other interconnected physical parties to ensure accurate scheduling of 

flows on their systems. Electric transmission operators similarly communicate nonpublic interchange scheduling information and other information among themselves and 

with Balancing Authorities. Permitting interstate natural gas pipelines and electric 

transmission operators to exchange non-public, operational information with each other 

will help them better plan for day-to-day operations as well as better manage their 

respective system needs during potential coincident peaks that may limit the flexibility of 

both systems. 

28. Further, the adoption of a No-Conduit Rule, together with existing safeguards, 

reasonably addresses the concerns around the improper use of non-public, operational 

information.42 

 42 As discussed earlier, interstate natural gas pipelines and electric transmission 

operators are not similarly situated to other customers since they (1) are not typically 

customers of each other; and (2) operate physical systems and require information about 

physically interconnected and interdependent systems in order to maintain efficient and 

reliable service to their customers.
Docket No. RM13-17-000 - 22 -

29. We disagree with APGA’s characterization that the proposed rule lacks value. 

The majority of commenters expressly support the rule and in many of their comments 

they affirm that the rule would promote reliable service. We are persuaded by these 

comments that argue that expressly permitting the sharing of non-public, operational 

information will promote reliable service and operational planning. For example, 

representatives and members of the interstate natural gas pipeline industry, including 

INGAA and Boardwalk Pipelines, are among the many commenters that expressly 

support the rule. Also, several entities, including electric transmission operators, have 

specifically identified non-public information that they would like to receive from or 

share with interstate natural gas pipelines under the rule because they believe it would 

promote reliable service or operational planning on both systems. Such information 

includes real-time pipeline flow information, generator service nominations and priority, 

and generator outage information. Improved reliability and operational planning amongst 

transmission operators will benefit both electric and natural gas industries as well as 

ultimate consumers.

30. We do not agree with Consumers Energy and APGA that this rule is unnecessary 

because the exchange of information can be achieved solely through the use of tariffs and 

contracts or through a case-by-case evaluation. As explained above, interstate natural gas 

pipelines and electric transmission operators may need a variety of information from each 

other depending on individual circumstances and may not be in a position to anticipate in 

advance exactly what information needs to be exchanged. Despite this need, these 

transmission operators have expressed concerns that the Commission’s current 
Docket No. RM13-17-000 - 23 -

regulations and uncertainty over their ability to share non-public, operational information 

acts as an impediment to exchange of this information. Adopting regulations that 

eliminate transmission operator concerns about such exchanges will provide the 

flexibility that they require.

31. APGA also suggests that the real issue is the lack of pipeline capacity resulting 

from generators’ failure to subscribe to adequate firm transportation service. That does 

not diminish the need for transmission operators to be able to exchange non-public, 

operational information. No one disputes that the electric industry has become 

increasingly dependent on gas-fired generation and coordination is integral to promoting 

reliable service. Natural gas and electric coordination has many facets including 

communications, scheduling, and capacity release.43 In this Final Rule, the Commission 

is focused solely on communications.

32. The Commission also finds that existing safeguards, together with the adoption of 

a No-Conduit Rule, reasonably address APGA’s and NJBPU’s concerns regarding the 

improper use of non-public, operational information, whether by an initial recipient of 

 43 Coordination between Natural Gas and Electricity Markets, Docket No. AD12-

12-000 (July 5, 2012) (Notice of Technical Conferences) (available at

http://elibrary.ferc.gov/idmws/common/opennat.asp?fileID=13023450); 77 FR 41184 

(July 12, 2012) (available at http://www.gpo.gov/fdsys/pkg/FR-2012-07-12/pdf/2012-

16997.pdf); Coordination between Natural Gas and Electricity Markets, Docket No. 

AD12-12-000 (Dec. 7, 2012) (Notice Of Request for Comments and Technical 

Conference) (http://www.ferc.gov/EventCalendar/Files/20121207134434-AD12-12-

000TC1.pdf); 77 FR 74180 (Dec. 13, 2012) (http://www.gpo.gov/fdsys/pkg/FR-2012-12-

13/pdf/2012-30063.pdf); Coordination between Natural Gas and Electricity Markets, 

Docket No. AD12-12-000 (Mar. 5, 2013) (Notice of Technical Conference). 
Docket No. RM13-17-000 - 24 -

non-public, operational information or in a subsequent disclosure. In addition, the 

Commission’s regulations expressly preclude the type of abuse, gaming, and market 

manipulation that NJBPU warns against.44 As we have noted, both interstate pipelines 

and electric transmission operators must comply with their tariffs and applicable 

Commission regulations when making capacity allocation and other operational 

determinations.45 Moreover, under the Standards of Conduct and the No-Conduit Rule 

adopted in this proceeding, interstate natural gas pipelines and electric transmission 

operators cannot share this information with their marketing function employees.46 Nor 

can they provide this information to third-parties. While any exchange of non-public 

information may pose some disclosure risks, we find that, on balance, the regulations 

adopted here, including the No-Conduit Rule, appropriately balance the significant 

benefits to be gained by robust information exchange among interdependent transmission 

operators against the potential risks from disclosure of non-public information. 

 44 The Commission would have jurisdiction to pursue violations of the 

Commission’s Anti-Manipulation Rule, 18 CFR 1c (2013) if an entity (including a nonjurisdictional entity) uses a fraudulent scheme or makes a material misrepresentation that 

would operate as a fraud or deceit upon any entity or market; has the requisite scienter; 

and in connection with a transaction subject to the Commission’s jurisdiction. 

45 See ISO New England Inc., 142 FERC ¶ 61,058, at P 23 (2013) (available 

capacity must be dispatched “consistent with the pipeline’s tariff” and “[t]he pipelines are 

required to allocate available capacity on a not unduly discriminatory basis among the 

various requestors of capacity.”)

46 See 18 CFR 358.6 and 358.7 (2013).
Docket No. RM13-17-000 - 25 -

B. Scope of Information

1. NOPR

33. In the NOPR, the Commission proposed to authorize public utilities providing 

transmission service and interstate natural gas pipelines to share non-public, operational 

information when such information is for the purpose of promoting reliable service or 

operational planning. The Commission stated that the term “non-public, operational 

information” is information that is not publicly posted, yet helps transmission operators 

to operate and maintain either a reliable pipeline system or a reliable electric transmission 

system on a day-to-day basis, as well as during emergency conditions or for operational 

planning. The NOPR stated that non-public, operational information may also include 

generator, pipeline, or transmission-specific information. In using the term “non-public, 

operational information,” the Commission intends that transmission operators would be 

permitted to share information dealing with actual, anticipated, or potential effects on the 

ability to provide electric and gas service based on the respective operator’s experience 

and understanding of the operational capability and customer demands on their respective 

systems.

34. The NOPR sought comment on the scope of the non-public, operational 

information that transmission operators may share under the proposed regulations.47 The 

Commission stated that the proposed regulations were structured to provide significant 

 47 NOPR, FERC Stats. & Regs. ¶ 32,699 at P 24 (cross-referenced at 144 FERC 

¶ 61,043).
Docket No. RM13-17-000 - 26 -

flexibility to individual transmission operators—who have the most insight and 

knowledge of their systems—to determine what non-public operational information, if 

any, would promote reliable service on their systems, without fear of violating the 

Commission’s prohibitions on undue discrimination and undue preference or such an 

exchange being considered an unjust or unreasonable practice.48 In proposing the 

regulations, the Commission stated its intent to remove barriers to the sharing of nonpublic, operational information, not just during emergencies, but also for day-to-day 

operations, planned outages, and scheduled maintenance.49 

2. Comments 

35. Several commenters express support for allowing transmission operators to 

determine the specific non-public, operational information to share, as opposed to the 

Commission providing a prescriptive, exhaustive list of information that may be shared.50 

In supporting the NOPR’s proposed scope, these commenters state that the proposed rule 

would permit flexible communications that are appropriately suited to the differences in 

information needs of each region. For example, NEPGA states that the NOPR provides 

 48 Id. P 11.

49 Id. P 10.

50 MMWEC Comments at 4; NEPGA Comments at 3; PG&E Comments at 4 and 

5; TVA Comments at 2; NYTOs Comments at 7; MISO Comments at 3; INGAA 

Comments at 2 and 4; Enable Comments at 1; APPA Comments at 5; PUCO Comments 

at 6; NRECA Comments at 7; CAISO Comments at 3; and EEI Comments at 4 and 5. 
Docket No. RM13-17-000 - 27 -

for an appropriate amount of deference by defining the categories and scope of 

information that may be shared without narrowly defining each type of information.51

36. AGA agrees with the Commission that the proposed communications are 

important not only during emergencies or critical situations, but also when conditions, or 

emerging conditions, could lead to events on either system that have the potential to 

threaten the integrity or reliability of one or both of the systems.52 NERC contends that 

the exchange and availability of real-time, day-ahead, and season-ahead gas flow 

information and data to transmission system operators will best address electric 

vulnerabilities related to natural gas fuel disruptions.53 

37. Beyond supporting the approach proposed in this rulemaking, some commenters 

warned of the dangers of trying to develop an exhaustive list of the permitted 

communications. For example, MMWEC expressed concern about the chilling effect on 

system operators that would result if the Commission issued a specific list of information 

permitted to be shared. MMWEC states that under such a proscriptive approach, 

operators would be wary of violating Commission rules by sharing information not 

specifically identified.54 MMWEC further argues that it is better to encourage a broad 

range of information sharing rather than a restrictive approach considering the critical 

 51 NEPGA Comments at 3.

52 AGA Comments at 5.

53 NERC Comments at 6.

54 MMWEC Comments at 4. 
Docket No. RM13-17-000 - 28 -

situation in New England.55 PG&E notes that the use of a specific list of information 

may also impede communications should such a list exclude a key type of information.56

38. A few commenters, however, oppose the generality of the proposed scope of 

communications permitted in the NOPR and request greater specificity of the non-public, 

operational information that may be shared between transmission operators.57 For 

example, NGSA contends that the lack of specific parameters on what information 

sharing is acceptable creates further uncertainty and concern for market participants.58 

NGSA argues that the scope of the NOPR, which allows the sharing of any information 

for the purpose of promoting reliable service and operational planning, is overly broad 

and could allow operators to share commercially sensitive information.59 NGSA 

proposes that the Commission limit interstate natural gas pipeline and electric 

transmission operators’ ability to share non-public information by setting parameters for 

what information is acceptable for operators to share.60 NGSA contends that providing 

parameters for what information can be shared would reduce confusion and give industry 

greater confidence that commercially sensitive information was not being disclosed 

 55 Id.

56 PG&E Comments at 5. 

57 AEP Comments at 4; NGSA Comments at 6-9; and NJBPU Comments at 3.

58 NGSA Comments at 6.

59 Id. at 7.

60 Id. at 8.
Docket No. RM13-17-000 - 29 -

without companies’ knowledge. NJBPU states that the Commission should provide clear 

and explicit limits as to what information should be kept confidential and what 

information may be disclosed.61

39. Consumers Energy is concerned that because the proposed rule does not provide a 

specific list of non-public, operational information that can be shared, the proposal raises 

the potential for compliance issues related to interpreting what information may and may 

not permissibly be shared.62 Consumers Energy is also concerned with the potential 

consequences for unknowingly receiving information that could not permissibly be 

shared and the consequences of taking action, or failing to act, based on the receipt of 

such information.

40. In addition, some commenters believe that the sharing of non-public, operational 

information should be limited to emergencies. In particular, ELCON urges the 

Commission to emphasize that the central purpose of information sharing between 

interstate natural gas pipelines and electric transmission operators is to address system 

reliability and information sharing and, therefore, should focus on unusual non-routine 

circumstances and not on normal day-to-day operations.63 ELCON states that outages, 

potential delivery restrictions, or curtailments that could occur during extreme weather 

events are examples of such unusual circumstances that would warrant the information 

 61 NJBPU Comments at 3.

62 Consumers Energy Comments at 5.

63 ELCON Comments at 2.
Docket No. RM13-17-000 - 30 -

sharing between operators. NE Gas Industry states that the proposed communications are 

critical in emergency situations of imminent reliability concerns when the 

communications can have the most immediate and positive impact, but should not be 

relied upon by the RTOs/ISOs on a day-to-day basis in ensuring the reliability of the 

natural gas-fired generators in their service territories.64 

3. Commission Determination

41. The Commission adopts the NOPR proposal to provide explicit authority to 

transmission operators to share non-public, operational information with each other for 

the purpose of promoting reliable service or operational planning on either the public 

utility or interstate natural gas pipeline’s system. In adopting the NOPR proposal, the 

Commission is intentionally permitting the communication of a broad range of nonpublic, operational information to provide flexibility to individual transmission operators, 

who have the most insight and knowledge of their systems, to share that information 

which they deem necessary to promote reliable service on their system. The Commission 

is not persuaded by the requests of NGSA, AEP, and NJBPU that the Commission 

specify the communications that transmission operators may share under the rule. As 

described above, the exchange of non-public, operational information between 

transmission operators would be to promote the reliability and operational integrity of 

both the electric transmission and pipeline systems. Given the wide variety of non-public 

operational information that may be needed for this purpose both now and in the future, it 

 64 NE Gas Industry Comments at 8.
Docket No. RM13-17-000 - 31 -

is not practicable to develop a specific and exhaustive list defining the permissible 

communications.65 The Commission finds that the inclusion of such a list in the 

regulations would unreasonably limit the flexibility of transmission operators to 

determine what information they need based upon the individual circumstances of their 

systems.

42. In addition, the Commission recognizes that the informational needs of system 

operators vary by region and, therefore, a specific and exhaustive list of permissive 

communications that may be relevant in one region may not address the communications 

and operational needs of transmission operators in another region. The Commission also 

recognizes that the informational needs of transmission operators may evolve over time 

as the generation mix in regions change and as transmission operators develop further 

insight into, and gain additional experience with, gas and electric coordination issues. In 

response to Consumers Energy’s concern about what information may permissibly be 

shared, to the extent that a transmission operator is uncertain as to what information may 

and may not permissibly be shared, the Commission’s compliance help desk is available 

to industry for informal guidance.66

 65 Below in section III.C we address comments regarding the examples of nonpublic operational information included in the NOPR.

66 The Compliance Help Desk is available for persons seeking technical assistance 

involving compliance with the statutes, rules, regulations, and tariffs administered by the 

Commission. See http://www.ferc.gov/contact-us/compliance-help-desk/compliancehelp-desk.asp.
Docket No. RM13-17-000 - 32 -

43. The Commission reaffirms its intention, as stated in the NOPR, to remove barriers 

to the sharing of non-public, operational information between transmission operators not 

just during emergencies, but also for day-to-day operations, planned outages, and 

scheduled maintenance. The communication of non-public, operational information 

permitted under this Final Rule will be applicable in all operational situations, that is, 

during both emergency and non-emergency situations. While communications permitted 

under the rule will be especially valuable in emergency situations, transmission operators 

should feel confident in their ability to engage in robust communications with each other, 

subject to the No-Conduit Rule, whenever necessary to promote reliable service, 

including on a day-to-day basis. 

44. The Commission disagrees with ELCON that information sharing permitted under 

the rule should focus on unusual, non-routine circumstances such as outages during 

extreme weather events. The Commission’s intent in providing explicit authority to 

transmission operators to share non-public, operational information with each other is to 

provide certainty. In part, the rule is designed to permit exchanges of information that 

may limit or prevent extreme weather events from having the impacts about which 

ELCON is concerned. It could create further confusion or complexity to require 

transmission operators to decipher whether system conditions have risen to the level of 

unusual or non-routine before they engage in communications that promote reliable 

service or operational planning. Therefore, the Commission declines to limit 

communications or to create a new definition of what constitutes an emergency for the 

purpose of expressly authorizing communications under this rule. 
Docket No. RM13-17-000 - 33 -

45. In order to maintain reliability, it will be important for transmission operators to 

coordinate planned outages and scheduled maintenance on both natural gas and electric 

systems so that any potential challenges may be identified more quickly, thus allowing 

more time to develop reliable solutions. The Commission is encouraged by the ongoing 

efforts regions are undertaking to improve coordination of scheduled maintenance and 

planned outages, and is hopeful that this Final Rule will allow for greater collaboration 

between the industries. The Commission re-emphasizes that communications for both 

electric transmission operators and interstate natural gas pipelines are voluntary, and 

encourages regions to develop the communications processes or protocols appropriately 

tailored to the needs of transmission operators in each individual region.

C. Entities Covered Under the Rule

1. NOPR

46. In the NOPR, the Commission proposed to provide explicit authority to interstate 

natural gas pipelines and public utilities that own, operate, or control facilities used for 

the transmission of electric energy in interstate commerce to share non-public, 

operational information with each other for the purpose of promoting reliable service or 

operational planning on either the public utility’s or pipeline’s system. 

47. The NOPR recognized the existing exchanges of information among pipelines and 

among electric transmission operators that promote reliable service or operational 

planning. It also noted that, while the Commission regulates interstate service provided 

by intrastate pipelines, Hinshaw pipelines, and LDCs, the companies themselves are 
Docket No. RM13-17-000 - 34 -

subject to state regulation and may exchange information subject to any state regulations 

that govern their operations. 

48. It was also noted in the NOPR that communications between transmission 

operators and generators are not covered by the proposed rule, but that transmission 

operators may always discuss generator-specific information with the relevant generator. 

2. Comments

49. AGA and Duke urge the Commission to clarify that public utilities and interstate 

natural gas pipelines may share non-public, operational information with intrastate 

pipelines and LDCs for the purpose of promoting reliable service or operational 

planning.67 In its reply comments, NGSA states that, to the extent that LDCs, intrastate 

pipelines, gatherers and generators are allowed to communicate with interstate natural gas 

pipelines and electric transmission operators, the Commission should require that the NoConduit Rule be extended to them as a measure of protection for any non-public 

information that may have been inadvertently conveyed. Applying the No-Conduit Rule 

to all entities that are allowed to communicate under the proposed rule, NGSA asserts, 

could help protect commercially sensitive information.68 

50. The NYTOs urge the Commission to make clear in the Final Rule that 

transmission operators may share non-public, operational information with LDCs on a 

 67 AGA Comments at 5-6, 8; Duke Comments at 3.

68 NGSA Reply Comments at 4-5.
Docket No. RM13-17-000 - 35 -

confidential basis.69 While the NYISO is aware that state regulations govern the 

operations of intrastate pipelines, Hinshaw pipelines, and LDCs,70 the NYISO states that 

receiving information from intrastate and LDC pipelines would be helpful and urges the 

Commission to encourage the same shared communication between these entities and 

transmission operators.71 The NYTOs state that, like transmission operators, LDCs are 

not similarly situated to other customers because they require access to non-public 

information from a variety of sources to assist in ensuring the reliability and integrity of 

their systems.72 Further, the NYTOs state that LDCs are not generally customers of 

electric system operators and RTOs/ISOs are not customers of LDCs. The NYTOs state 

that, while LDCs are shippers on interstate natural gas pipelines, for the purposes of 

maintaining reliability and operational planning, LDCs’ actions are more akin to a system 

operator than a gas customer – especially when evaluating fuel security risks for gas-fired 

generation located behind their city-gates. 

51. AGA asserts that LDC employees directly responsible for operating the local gas 

system need access to such non-public, operational information to assist in ensuring the 

 69 NYTOs Comments at 6.

70 NYISO Comments at 3.

71 Id. at 2-3. NYISO asserts that the majority of New York Control Area gas-fired 

generators are located behind an LDC, as opposed to directly connected to the interstate 

pipelines. 

72 NYTOs Comments at 6.
Docket No. RM13-17-000 - 36 -

integrity of their system. Moreover, AGA believes that such communications are not 

currently prohibited under the NGA or the Commission’s Standards of Conduct.73 

52. Further, AGA states that the Commission’s proposed revisions are unclear with 

respect to LDCs.74 AGA states that proposed sections 38.2 and 284.12 refer to pipelines 

covered by section 284.12(b)(4) of the Commission’s regulations as entities authorized to 

receive non-public, operational information for the purposes of promoting reliable service 

or operational planning. AGA states that it is unclear whether the term “pipelines” in that 

context is limited to interstate natural gas companies subject to the Commission’s 

jurisdiction under section 1(b) of the NGA or includes any pipeline providing service 

under the Commission’s Part 284 regulations implementing the Natural Gas Policy Act of 

1978. AGA states that, if the former, LDCs would not be considered pipelines authorized 

to receive non-public, operational information and, if the latter, an LDC would only be 

considered a pipeline authorized to receive non-public, operational information to the 

extent the LDC provides interstate transportation or storage service under Part 284, 

Subpart C or G. AGA states that LDCs in their traditional role as bundled retail sales or 

gas service providers would not be considered “pipelines” under the Commission’s 

proposal.75 AGA, therefore, recommends that the Commission clarify that public utilities 

 73 AGA Comments at 6.

74 Id. at 7.

75 Id. at 7-8.
Docket No. RM13-17-000 - 37 -

and interstate natural gas pipelines may share non-public, operational information with 

LDCs for the purpose of promoting reliable service or operational planning.76

53. As a separate issue, AGA is also concerned that “the interpretation that ‘pipelines’ 

under proposed sections 38.2 and 284.12(b)(4) would include an intrastate or Hinshaw 

pipeline providing interstate transportation or storage service under Part 284, Subpart C 

or G, may impose new obligations on LDCs contrary to the Commission’s permissive 

approach in this proceeding.”77 AGA states that, currently, the Commission’s Standards 

of Conduct apply to interstate natural gas pipelines and impose no regulatory obligations 

directly on LDCs. AGA further states that, if an intrastate or Hinshaw pipeline were to 

be considered a “pipeline” subject to revised section 284.12(b)(4), questions arise 

regarding whether and how it must comply with the proposed No-Conduit Rules, which 

prohibit disclosure to marketing function employees as defined in section 358.3(d). In 

light of the potential ambiguity, AGA urges the Commission to “reiterate its intent not to 

impose new regulatory obligations in this proceeding and clarify that an intrastate or 

Hinshaw pipeline providing interstate service under Part 284 of the Commission’s 

regulations is not a ‘pipeline’ for purposes of proposed section 284.12(b)(4).”78

 76 Id. at 8.

77 Id.

78 Id.
Docket No. RM13-17-000 - 38 -

54. EEI and Duke Energy request confirmation that otherwise permissible 

communications will not be impacted by the NOPR.79 Specifically, EEI requests that the 

Final Rule include regulatory text that expressly states that its scope does not and is not 

intended to prohibit otherwise permissible communication between market participants.80 

EEI states that this would include, for example, communications between: public utilities 

and their customers; interstate natural gas pipelines and their customers; interstate natural 

gas pipelines and LDCs; and LDCs and generators, as there are many generation units 

that are served by LDCs behind the city gate. 

55. Similarly, Duke Energy requests that the Commission clarify that communication 

between interstate natural gas pipelines and LDCs, and LDCs and generators (served 

behind the city gate), as well as communications among the pipelines, transmission 

operators, generators being served by the interstate natural gas pipeline and transmission 

operator, and other non-marketing employees of the transmission operator, are not 

prohibited, provided that the Standards of Conduct No-Conduit Rule is followed and nonpublic transmission or customer information is not shared with marketing function 

employees.81 

 79 Duke Comments at 2; EEI Comments at 3. 

80 EEI Comments at 3-4.

81 Duke Comments at 2.
Docket No. RM13-17-000 - 39 -

3. Commission Determination

56. In this Final Rule, the Commission adopts proposed sections 38.2 and 

284.12(b)(4) as proposed in the NOPR. The Commission finds that the nature and scope 

of non-public, operational information that may expressly be shared under the rule, 

including commercially sensitive, customer-specific information, warrants limiting the 

blanket authorization of the exchange of such information granted herein to interstate 

natural gas pipelines and public utilities that own, operate, or control facilities used for 

the transmission of electric energy in interstate commerce subject to the Commission’s 

jurisdiction.82 As discussed below, we decline to authorize in this Final Rule the 

disclosure of non-public, operational information, which may include commercially 

sensitive, customer specific information, to LDCs, intrastate pipelines, or gatherers. 

However, we clarify that the No-Conduit Rule adopted in this Final Rule only applies to 

the non-public, operational information an electric transmission operator provides to the 

interstate pipeline pursuant to this rule or vice versa. Therefore, the No-Conduit Rule 

adopted in this Final Rule does not otherwise affect the ability of interstate natural gas 

pipelines to exchange operational information among themselves or with LDCs regarding 

actual or potential pipeline or distribution system operational conditions affecting the gas 

flow between these physically interconnected parties. Nor does it affect the ability of an 

 82 Wholesale Competition in Regions with Organized Electric Markets, Order 

No. 719, FERC Stats. & Regs. ¶ 31,281 at P 423 (2008) (cross-referenced at 125 FERC 

¶ 61,071 (2008)) (Commission determined that it was necessary to retain the practice of 

masking the identity of participants when releasing offer and bid data).
Docket No. RM13-17-000 - 40 -

electric transmission operator to share its own information with an LDC, if otherwise 

permitted under its tariff. Similarly, the No-Conduit Rule does not otherwise affect the 

ability of interstate natural gas pipelines and intrastate natural gas pipelines and gatherers 

to exchange operational information regarding operational conditions affecting the gas 

flows between these physically interconnected parties. Moreover, this Final Rule does 

not prohibit electric transmission operators from sharing non-public, operational 

information received from a pipeline pursuant to this Final Rule with LDCs, if the 

information sharing and appropriate safeguards to prevent inappropriate use or disclosure 

of shared information is separately authorized by the Commission, for example pursuant 

to a FPA section 205 tariff filing by an ISO or RTO. 

57. We recognize that LDCs and other parties do have a significant role to play in 

maintaining reliability of both interstate natural gas pipeline transportation systems and 

electric transmission systems, as the commenters point out, particularly since many 

electric generators take service from LDCs, rather than directly from interstate pipelines. 

However, because the Commission generally does not have jurisdiction over LDCs, and 

because the scope of the authorized non-public, operational information exchange 

between interstate natural gas pipelines and electric transmission operators under this 

Final Rule is broad, we are reluctant to authorize blanket authority for interstate natural 

gas pipelines or electric transmission operators to pass such information to nonjurisdictional LDCs. Instead, we prefer to proceed on a case-by-case basis with respect 

to electric transmission operators sharing non-public, operational information received 

from a pipeline pursuant to this Final Rule with LDCs. Electric transmission operators 
Docket No. RM13-17-000 - 41 -

that see the need for such communication given the circumstances on their systems may 

develop tariff provisions that establish acceptable procedures for the handling and 

protection from inappropriate disclosure or use of such information.83 

58. For example, in a recent, unprotested tariff filing by the California Independent 

System Operator (CAISO),84 CAISO amended its tariff to specifically authorize the 

CAISO to share, under a non-disclosure agreement, outage information with natural gas 

transmission and distribution utilities operating interstate and/or intrastate natural gas 

pipelines that serve natural gas-fired generation resources within the CAISO Balancing 

Authority Area, with or without notice to the affected market participant. The 

information CAISO may share includes, but is not limited to, the identity of individual 

natural gas-fired generation resources that are needed to support reliability of the CAISO 

Balancing Authority Area in the event of a natural gas shortage, natural gas pipeline 

testing and maintenance, or other curtailment of natural gas supplies. If they believe it 

necessary or appropriate, other electric transmission operators may make similar FPA 

section 205 tariff filings to facilitate greater sharing of non-public, operational 

information received from a pipeline pursuant to this Final Rule with entities such as 

LDCs. We encourage those electric transmission operators that are concerned about 

generators that are located behind an LDC to consider developing such tariff revisions.

 83 For example, such tariff conditions might require the LDC to enter into a nondisclosure agreement (NDA).

84 Cal. Indep. Sys. Operator Corp., Docket No. ER12-278-000 (Dec. 8, 2011) 

(delegated letter order).
Docket No. RM13-17-000 - 42 -

59. AGA requests clarification as to the whether the term pipeline includes intrastate 

pipelines. The Commission clarifies that the term “pipeline” in section 284.12(b)(4) 

adopted in this Final Rule refers to interstate natural gas pipelines that transport gas under 

subparts B or G of Part 284.85 Section 284.12(b)(4) is a new subsection of existing 

section 284.12(b). The first sentence of that section makes clear that the word “pipeline” 

as used throughout section 284.12(b) refers only to “an interstate pipeline that transports 

gas under subparts B or G of this part.” Thus, an intrastate or Hinshaw pipeline 

providing interstate service under Part 284 of the Commission’s regulations is not a 

“pipeline” for purposes of section 284.12(b)(4).

D. The No-Conduit Rule and Competitive Concerns

1. NOPR

60. In the NOPR, the Commission proposed to adopt a No-Conduit Rule that would 

prohibit all public utilities and interstate natural gas pipelines, as well as their employees, 

contractors, consultants, or agents, from disclosing, or using anyone as a conduit for the 

disclosure of, non-public, operational information they receive under this rule to a third 

party or to its marketing function employees, as that term is defined in section 358.3 of 

the Commission’s regulations. The Commission stated that the No-Conduit Rule, in 

addition to protections already in place, would ensure that any non-public, operational 

information shared under the proposed regulations remains confidential and is shared 

 85 See 18 CFR 284.12(b) (2013).
Docket No. RM13-17-000 - 43 -

among transmission operators in a manner that is consistent with the prohibition on 

undue discrimination.86 

61. In describing the need for the No-Conduit Rule, the Commission explained that 

the existing No-Conduit Rule under the Standards of Conduct would not sufficiently limit 

the disclosure of the information received under this proposed rule.87 Therefore, the 

Commission proposed a No-Conduit Rule tailored to the entities and information covered 

by the proposed rule and extends the disclosure prohibition to non-affiliates.

62. The Commission also noted the concerns expressed by some entities that 

generator-specific, non-public information provided to a pipeline by an electric 

transmission operator could provide the pipeline with a competitive advantage over the 

generator in pricing transportation services.88 The Commission found no need to propose 

additional protections regarding interstate natural gas pipeline transportation. The 

Commission reasoned that interstate pipelines are required to allocate service, on a not 

unduly discriminatory basis, based on their tariffs, at a rate not exceeding the just and 

reasonable rate on file. The Commission also explained that pipelines are not required to 

discount services, and if they choose to discount, are permitted to obtain information 

 86 NOPR, FERC Stats. & Regs. ¶ 32,699 at P 26 (cross-referenced at144 FERC 

¶ 61,043).

87 Id. P 26 & n.50.

88 Id. P 27.
Docket No. RM13-17-000 - 44 -

from any source to demonstrate that the shipper requesting the discount has competitive 

alternatives.89

63. The Commission stated that unauthorized disclosure of any non-public, 

operational information may subject the entity or individual making the prohibited 

disclosure to the enforcement provisions of the FPA and NGA, including potential civil 

penalties.90 

64. Thirteen commenters filed in support of the proposed No-Conduit Rule.91 

Arguing that the No-Conduit Rule was either too strict or not strict enough, several 

commenters proposed modifications to or requested clarifications of the No-Conduit 

Rule. Those comments are discussed below.

2. Adequacy of No-Conduit Rule to Protect against Competitive 

Harm

a. Comments

65. Several commenters are concerned that the proposed No-Conduit Rule is 

inadequate to prevent the misuse of non-public, operational information exchanged 

between electric transmission operators and pipelines and protect against competitive 

 89 Id.

90 Id. P 26 & n.52 (citing section 22 of the NGA, 15 U.S.C. 717t2-1 (2012), and 

section 316A of the FPA, 16 U.S.C. 825o-1 (2012)).

91 AEP Comments at 5-6; CAISO Comments at 5; Duke Energy Comments at 3;

ELCON Comments at 3; EPSA Comments at 7; MISO Comments at 2; MMWEC 

Comments at 5; NESCOE Comments at 4,6; NRECA Comments at 5; NYTOs 

Comments at 1; PG&E Comments at 2-3; PUCO Comments at 5; TVA Comments at 3. 
Docket No. RM13-17-000 - 45 -

harm to generators, natural gas marketers, and others. These commenters recommend 

that the Commission adopt various modifications to the No-Conduit Rule or place 

additional limits on the information which transmission operators may share, as discussed 

below.92 

66. EPSA and NGSA seek clarification that the No-Conduit Rule covers nonoperational interstate natural gas pipeline employees that market transportation 

capacity.93 NGSA states that giving access to non-public, operational information to 

pipeline capacity marketing employees that negotiate shipper discounts could be 

problematic.94 NGSA states that, for example, a pipeline capacity marketing employee 

could decide not to discount interruptible capacity because they have prior knowledge of 

a transmission operator’s intent to ramp up gas-fired generators, increasing demand on 

the pipeline. Or, the pipeline capacity marketing employee could use knowledge of 

upcoming generator outages to lower interruptible prices for a period to compete with 

capacity releases. NGSA states that, while the Commission correctly notes that its nondiscrimination rules already forbid any discriminatory behavior, it still would seem 

 92 AEP Comments at 6; APGA Comments at 2-3; Duke Comments at 3; NGSA 

Comments at 2-3; and PUCO Comments at 7. 

93 EPSA Comments at 4; NGSA Comments at 4-6.

94 NGSA Comments at 4.
Docket No. RM13-17-000 - 46 -

prudent to limit access to non-public, operational information for pipeline transportation 

capacity sellers.95 

67. Washington Gas is concerned that the NOPR does not explain how information 

can or cannot be shared within a public utility that receives non-public operating 

information.96 Washington Gas contends that if the generator employees only serve the 

function of purchasing gas—rather than selling energy at wholesale—they may not come 

within the definition of “marketing function employees” because the currently effective 

Standards of Conduct do not consider gas purchasing to be a marketing function activity. 

Washington Gas argues, if non-public information is shared within a public utility, it 

would create a preference for public utility-owned generation over independent 

generators because independent generators would be "third parties" prohibited from 

information sharing. Washington Gas concludes that, if the Commission relies on a NoConduit Rule to protect information from reaching beyond transmission function 

employees, the Commission should provide detailed examples of exactly how the NoConduit Rule will be implemented to protect the fairness of the market and assure that no 

shipper is afforded an undue preference.97 

68. Washington Gas claims that the best way to resolve the tension between 

information sharing and market fairness is to continue to make critical operating 

 95 Id. at 5.

96 Washington Gas Comments at 10.

97 Id. at 11.
Docket No. RM13-17-000 - 47 -

information public. Washington Gas contends that certain of the examples of “nonpublic, operational information” listed in the NOPR should never be considered nonpublic, operational information.98 Rather, Washington Gas contends, this information 

should be considered public information to be promptly posted. Washington Gas 

believes that the only information properly shared on a non-public basis would be 

transaction-specific information.99 Accordingly, Washington Gas urges the Commission 

to clarify that all pipeline facility outage and maintenance information needs to be made 

public and posted on the pipeline’s internet website and to establish clear instructions as 

to what exact information must be posted and what can be shared voluntarily in a nonpublic way.100 

69. Similar to Washington Gas, AGA states that it assumes that the Commission 

would continue to require interstate pipelines to provide all shippers with equal access to 

information regarding system conditions, maintenance schedules and outages, and 

available capacity so as not to create competitive advantages for certain shippers.101

70. PUCO supports the proposed No-Conduit Rule, but contends that proposed 

section 38.2 should be modified to include additional language to require that no nonpublic information be shared with any person or company affiliate except to ensure the 

 98 Id. at 3.

99 Id. at 4.

100 Id. at 3-4. 

101 AGA Comments at 5 & n.14. 
Docket No. RM13-17-000 - 48 -

reliable and efficient operations of the pipeline, transmission grid, and the delivery of 

generation service.102 

71. Duke Energy notes that there are a number of small public utilities who currently 

have waivers of the requirement to abide by the Standards of Conduct or are otherwise 

not subject to the Standards of Conduct. Duke Energy requests that the Commission 

address its concern that these entities could receive commercially sensitive and nonpublic transmission information under the NOPR which could potentially give them an 

unfair advantage.103 

72. To alleviate concerns of confidential information disclosure, TVA recommends 

that, in addition to the No-Conduit Rule, the Commission should encourage and support 

the execution of confidentiality agreements between electric transmission operators and 

natural gas pipelines relative to these discussions.104

73. ELCON proposes two modifications to the No-Conduit Rule. First, ELCON 

asserts that the Commission should require electric transmission operators and interstate 

natural gas pipelines to submit an annual filing with the Commission listing entities with 

whom they have entered into information sharing arrangements and further certify that 

they acknowledge and comply with the No-Conduit Rule. Second, ELCON argues that 

 102 PUCO Comments at 5.

103 Duke Energy Comments at 3.

104 TVA Comments at 3-4.
Docket No. RM13-17-000 - 49 -

the Commission should require electric transmission operators and pipelines to maintain 

and implement a written compliance policy.105

74. PUCO also maintains that the Commission should, via an expansion of the instant 

proceeding, arrive at the appropriate requisite sanctions for the inappropriate sharing of 

potentially commercially sensitive, non-public information in violation of the No-Conduit 

Rule.106

75. Some commenters expressed concern about the scope of the non-public, 

operational information to be shared under the rule based on competitive concerns about 

the use of that information. NGSA is also concerned that the NOPR could allow 

transmission operators to share commercially sensitive information that could harm 

producers and marketers by revealing their positions in the market to outside parties.107 

NGSA states, for example, that a marketer’s commercial strategy could be revealed if the 

confidential details of the scheduling priorities it has contracted with its clients were 

shared.108 NGSA further contends that while it may be useful for utility operators to 

share information on overall pipeline capacity, sharing commercially sensitive 

 105 ELCON Comments at 3.

106 PUCO Comments at 5.

107 NGSA Comments at 7. 

108 Id.
Docket No. RM13-17-000 - 50 -

information such as individual shipper nominations offers little insight into the reliability 

of deliveries and could cause significant harm to some market participants.109 

76. Along the same lines, PUCO argues that electric transmission operators should be 

required to furnish pipelines with aggregated, non-unit specific generation data to ensure 

against inadvertently providing pipelines with confidential or proprietary information that 

could result in a competitive advantage concerning the pricing of gas to that facility.110

b. Commission Determination

77. In this Final Rule, the Commission adopts the proposed No-Conduit Rule as set 

forth in sections 38.2(b) and 284.12(b)(4)(ii) of the NOPR, without modification. The 

No-Conduit Rule prohibits all public utilities and interstate natural gas pipelines, as well 

as their employees, contractors, consultants, or agents, from disclosing, or using anyone 

as a conduit for the disclosure of, non-public, operational information they receive under 

this rule to a third party or to its marketing function employees, as that term is defined in 

§ 358.3 of the Commission’s regulations. The Commission concludes that the NoConduit Rule, as proposed, is necessary to ensure that any non-public, operational 

information shared under the regulations in this Final Rule remains confidential and is 

shared among transmission operators in a manner that is consistent with the prohibition 

on undue discrimination. As several commenters, including generators, pointed out, the 

 109 Id.

110 PUCO Comments at 7.
Docket No. RM13-17-000 - 51 -

No-Conduit Rule addresses many of the concerns over the sharing of commercially 

sensitive, customer-specific information among transmission operators.

78. At this time, we do not see the need to expand the No-Conduit Rule to explicitly 

prohibit disclosures to other employees or entities. We believe that, through this Final 

Rule and other Commission rules and regulations, we have adequate safeguards in place. 

In response to the comments received, we take this opportunity to explain the 

Commission’s requirements associated with the sharing of information and remind 

industry of the information already made available by the Commission’s regulations. 

79. Washington Gas, NGSA, and EPSA assert that certain employees may fall outside 

the Standards of Conduct definition of “marketing function employees” and therefore 

may receive information under this Final Rule, and be in a position to use that 

information to provide an undue preference. 

80. First, Washington Gas expresses concern that the proposed rule does not explain 

how non-public, operational information received by a public utility can or cannot be 

shared within that public utility, including with employees that fall outside the definition 

of “marketing function employee,” in particular, public utility employees that purchase 

gas. In Order Nos. 717 and 717-A, the Commission restricted its affiliate rule to cover 

only those employees that participate in electric sales markets and eliminated or rejected 
Docket No. RM13-17-000 - 52 -

proposals that would have expanded the rule to cover other employees.111 The 

Commission explained: 

The Commission agrees that restricting the definition of 

marketing functions to include only sales, rather than 

purchases, more closely matches the statutory prohibitions 

against undue preferences. Furthermore, the removal of 

purchases from the definition of marketing functions frees 

companies to conduct the informational exchanges necessary 

to engage in integrated resource planning....112

For similar reasons, the Final Rule is limited and therefore we find it is not appropriate to

expand the No-Conduit Rule adopted here to include employees who are not “marketing 

function employees,” such as gas purchasing employees. 

81. In addition, Washington Gas has not provided sufficient reason to expand the NoConduit Rule to gas purchasing employees or other employees of the public utility who 

are not marketing function employees. In this Final Rule the Commission’s intent is to 

remove barriers to the sharing of non-public, operational information between 

 111 See Standards of Conduct for Transmission Providers, Order No. 717, FERC 

Stats. & Regs. ¶ 31,280 at PP 77, 103 (cross-referenced at 125 FERC ¶ 61,064 (2008)); 

Order No. 717-A, FERC Stats. & Regs. ¶ 31,297 at P 35 (cross-referenced at 129 FERC

¶ 61,043 (2009)).

112 Order No. 717, FERC Stats. & Regs ¶ 31,280 at P 77 (cross-referenced at 

129 FERC ¶ 61,043 (footnotes omitted). See also Order No. 717-A, FERC Stats. & 

Regs. ¶ 31,297 at P 35 (cross-referenced at 129 FERC ¶ 61,043) (explaining that 

restricting the definition of marketing function to include only sales more closely matches 

the statutory prohibitions against undue preference. Specifically, sections 205 and 206 of 

the Federal Power Act prohibit undue preference or advantage to any person with respect 

to “any transmission or sale subject to the jurisdiction of the Commission . . . .” 

Similarly, sections 4 and 5 of the Natural Gas Act prohibit undue preference with respect 

to “any transportation or sale of natural gas subject to the jurisdiction of the 

Commission.).
Docket No. RM13-17-000 - 53 -

transmission operators for the purpose of promoting reliable service and operational 

planning. While certain gas purchasing employees may fall outside the definition of 

marketing function employees, within a vertically integrated utility, it may be necessary 

for an electric transmission operator, based on information received by an interstate 

natural gas pipeline, to inform its gas purchasers that it needs additional natural gas at 

another generating unit. Restricting such internal disclosure may limit the effectiveness 

of any such communication in responding to operational problems. 

82. Moreover, under section 284.13(d) of the Commission regulations,113 pipelines are 

already required to post important capacity and outage information at each scheduling 

opportunity. This includes “equal and timely access to information relevant to the 

availability of all transportation services whenever capacity is scheduled, including, but 

not limited to, the availability of capacity at receipt points, on the mainline, at delivery 

points, and in storage fields; whether the capacity is available directly from the pipeline 

or through capacity release; the total design capacity of each point or segment on the 

system; the amount scheduled at each point or segment whenever capacity is scheduled; 

and all planned and actual service outages or reductions in service capacity.” 

Washington Gas has not provided sufficient justification that, given the extent of these 

posting requirements, the potential risks it identifies associated with permitting the 

exchange of non-public, operational information between transmission operators, 

outweighs the efficiency and reliability benefits of permitting such communications. 

 113 18 CFR 284.13(d) (2013).
Docket No. RM13-17-000 - 54 -

83. While non-public, operational information falls outside of the posting 

requirements, we are not convinced such information needs to be disclosed to all 

shippers. For example, certain information may be relevant only to the operations of the 

public utility and may not need to be disclosed to all shippers.

84. We also deny EPSA’s and NGSA’s requests to expand the No-Conduit Rule to 

prohibit disclosures to interstate natural gas pipeline employees who market pipeline 

capacity, as well as PUCO’s request to require electric transmission operators to furnish 

pipelines aggregated, non-unit specific generation data to ensure against providing 

pipelines with confidential or proprietary information that could result in a competitive 

advantage concerning the pricing of gas to that facility. The Commission agrees with 

NGSA that “marketing function employees,” as that termed is defined in the Standard of 

Conduct, does not include employees that market transportation capacity. However, 

EPSA and NGSA have not shown that employees who market pipeline capacity can use 

non-public, operational information shared under this Final Rule to provide an undue 

preference or unduly discriminate in a manner inconsistent with the Commission’s 

policies or regulations. NGSA’s specific concern is that employees who market 

transportation capacity could use non-public, operational information shared under this 

rule to discriminate in their allocation or pricing of capacity. In response, we note that 

interstate natural pipelines are required by the NGA and their tariffs to allocate service on 

a not unduly discriminatory basis at a rate not exceeding the just and reasonable rate on 

file. Further, the Commission does not require pipelines to discount services below the 

pipeline’s maximum tariff rate, which the Commission has found just and reasonable. If 
Docket No. RM13-17-000 - 55 -

a pipeline chooses to provide selective discounts based on the elasticity of demand of its 

customers,114 the pipeline needs to obtain information to demonstrate that a shipper 

requesting a discount does have competitive alternatives justifying the discount in order 

to ensure that it treats all similarly situated customers on a comparable basis.115 

85. We also deny PUCO’s request to expand the No-Conduit Rule to require that nonpublic, operational information not be shared with any person or company affiliate except 

to ensure the reliable and efficient operations of the pipeline, transmission grid, and the 

delivery of generation service. As we explain elsewhere in this Final Rule, the 

Commission is concerned that adding further qualifiers to the definition of operational 

information will restrict the flexibility of transmission operators to determine what 

information it must share to promote reliable service and engage in effective operational 

planning. Moreover, adding further qualifiers is unnecessary, given our conclusion that 

the existing safeguards (e.g., the Standards of Conduct, prohibition against undue 

 114 See Associated Gas Distributors v. FERC, 824 F.2d 981 (D.C. Cir. 1987) 

(permitting selective discounting only when justified by competitive alternatives and 

elastic demand conditions); Williston Basin Interstate Pipeline Co., 85 FERC ¶ 61,247 

(1998) (finding that a pipeline does not necessarily have to offer the same discount to all 

customers at a point when the pipeline knows, if some customers at the point have elastic 

demand, while others have inelastic demand).

115 See, e.g., Panhandle Eastern Pipe Line Co., Opinion No. 395, 71 FERC 

¶ 61,228, at 61,867 (1995) (Commission cited to pipeline’s policy of requiring

documentation from its customers detailing the competitive circumstances justifying their 

need for a discount, such as potentially sensitive information concerning the end use 

customer for whom the gas will be transported, and competitive energy supplies, 

including the customer’s source and cost of alternative natural gas supplies or the type 

and cost of alternative fuels); Panhandle Eastern Pipe Line Co., Opinion No. 404, 

74 FERC ¶ 61,109, at 61,405 (1996).
Docket No. RM13-17-000 - 56 -

discrimination or preference, prohibition on market manipulation) together with the thirdparty limitation in the No-Conduit Rule we are putting in place are sufficient to protect 

against unnecessary disclosure. 

86. TVA proposes that, in addition to the No-Conduit Rule, the Commission require 

confidentiality agreements, while ELCON proposes that the Commission also require 

annual filings and written compliance procedures. Under this Final Rule, communication 

and sharing of non-public, operational information is voluntary. While the Commission 

will not embed such a requirement in its regulations, we note that CAISO and ISO-NE 

have both adopted such practices, and this Final Rule does not prescribe the mechanics of 

how voluntary sharing will be conducted. To the extent a transmission operator has a 

need for additional or changed information sharing procedures such as confidentiality 

agreements, the Commission will evaluate such requests on a case-by-case basis. With 

respect to PUCO’s comments regarding sanctions, the Commission reiterates that 

unauthorized disclosure of any non-public, operational information may subject the entity 

or individual making the prohibited disclosure to the enforcement provisions of the FPA 

and NGA, including potential civil penalties.116 The Commission declines to further 

delineate the specific sanctions that might apply in the event of an unauthorized 

disclosure, as any sanctions would need to be tailored to the facts and circumstances of 

the disclosure at issue. 

 116 See Section 22 of the NGA, 15 U.S.C. 717t2-1 (2012), and section 316A of the 

FPA, 16 U.S.C. 825o-1 (2012). 
Docket No. RM13-17-000 - 57 -

87. Duke argues that some small public utilities that currently have waivers of the 

requirement to abide by the Standards of Conduct could be given an unfair advantage if 

they receive commercially sensitive and non-public transmission information under the 

Final Rule. The Commission clarifies that existing waivers from the Standards of 

Conduct do not automatically apply to the No-Conduit Rule adopted in this Final Rule. 

That is, an existing waiver of the Standards of Conduct does not waive the No-Conduit 

Rule adopted here. In this Final Rule, the Commission is expressly authorizing the 

exchange of non-public, operational information that could include commercially 

sensitive, customer-specific information. The No-Conduit Rule was developed to address 

concerns that broadly sharing this kind of information with marketing function 

employees or third parties could cause competitive harm. Given that the information 

covered by this rule is potentially commercially sensitive, the Commission finds that a 

determination as to whether a waiver of the No-Conduit Rule adopted here is appropriate 

is best made on an individual basis, pursuant to a filing under FPA section 205 or NGA 

section 4.

88. In response to comments raising general concerns about the competitive impact of 

the use of non-public, operational information exchanged under this rule, the 

Commission finds that the No-Conduit Rule is sufficient to address these concerns. For 

example, NGSA asserts that a natural gas marketer’s commercial strategy could be 

revealed if the confidential details of the scheduling priorities it has contracted with its 

clients are revealed. While the Commission recognizes that a natural gas marketer’s 

scheduling priorities for its downstream clients are commercially sensitive, the No-
Docket No. RM13-17-000 - 58 -

Conduit Rule should ensure that the electric transmission operators, with whom pipelines 

may share such information, do not disclose that information to third party participants in 

the natural gas sales market. NGSA has not explained how a pipeline’s sharing of a 

natural gas marketer’s nominations with an electric transmission operator would cause 

competitive harm to the natural gas marketer, so long as the electric transmission operator 

complies with the No-Conduit Rule. 

89. The Commission similarly is not persuaded by PUCO’s concern that an electric 

transmission operator’s sharing of confidential unit-specific generator information with 

interstate pipeline providers could result in “a competitive advantage concerning the 

pricing of gas to that facility.”117 Interstate natural gas pipelines only provide unbundled 

transportation service and do not sell gas except for incidental sales required for the 

conduct of their transportation service. As discussed above, there are protections already 

in place to prevent undue discrimination or preference in the pipeline’s sale of 

transportation service.118 Given the protections already in place, we see no need to 

propose additional protections regarding pipeline transportation at this time.

3. Exceptions to the No-Conduit Rule

a. Comments

90. Several parties contend that the No-Conduit Rule is too restrictive and recommend 

that the Commission adopt various modifications, as discussed below. For example, NE 

 117 PUCO Comments at 7.

118 See, e.g., 18 CFR 284.286 (2013).
Docket No. RM13-17-000 - 59 -

Gas Industry and INGAA request that the proposed No-Conduit Rule be modified in the 

Final Rule to include an exception to allow sharing of non-public, operational 

information between all relevant industry participants in an emergency.119 INGAA, for 

example, states that there should be no limit on sharing of non-public, operational 

information between transmission operators during an emergency, including 

communications between third parties, subject to a record of the exchange as soon as 

practicable after the fact.120 NE Gas Industry and INGAA propose that communications 

in such emergencies could include RTOs and ISOs, interstate natural gas pipelines, 

generators of all fuel types, LDCs, liquefied natural gas suppliers, producers, marketers, 

asset managers, and other relevant participants in the energy industry.121 Alternatively, 

NE Gas Industry requests that the Commission clarify that the No-Conduit Rule does not 

prohibit such larger group discussions and apart from the Final Rule, pipelines and public 

utilities are permitted to share non-public, operational information with all relevant 

entities as necessary to mitigate or solve an emergency that threatens the reliability of 

electric or natural gas service. 

91. In its reply comments, NGSA states that the Commission should deny requests to 

suspend the communications rules during emergencies or clearly define what constitutes 

 119 NE Gas Industry at 3-4, INGAA Comments at 7. NE Gas Industry states that 

existing focus groups and joint industry task forces in New England can serve as the 

mechanisms to facilitate such open communication in times of emergency. 

120 INGAA Comments at 7.

121 NE Gas Industry Comments at 5; INGAA Comments at 7.
Docket No. RM13-17-000 - 60 -

an emergency.

122 NGSA is concerned that identifying what situations constitute an 

emergency can be subjective. NGSA states that at a minimum, the Commission should 

strictly maintain the No-Conduit Rule, restricting communications to operational (i.e. 

non-marketing) employees, at all times, regardless of any relaxation of the associated 

communications rules.

92. Enable contends that the Commission should adopt a modified version of the NoConduit Rule that allows interstate pipelines to share non-public, operational information 

with non-marketing function employee third parties for the purpose of promoting reliable 

service and operational planning.123 Enable asserts that the NOPR provides no rational 

basis for distinguishing between (A) “non-public, operational information” received from 

electric public utilities through this new regime, which interstate natural gas pipelines are 

barred from disclosing to anyone, and (B) general “non-public, operational information,” 

which pipelines may share with non-marketing function employees for operational 

reasons.

124 Enable asserts that currently, interstate pipelines receive non-public, 

operational information from a variety of sources and the NOPR sets forth no evidence 

that such information, when received from public utilities, would not be sufficiently 

protected by the current No-Conduit Rule as stated in the Standards of Conduct or by a 

 122 NGSA Reply Comments at 5.

123 Enable Comments at 9-10.

124 Id. at 6.
Docket No. RM13-17-000 - 61 -

less restrictive No-Conduit Rule.125 Enable states that the NOPR gives interstate gas 

pipelines access to information from electric public utilities for the purpose of improving 

reliability, but at the same time bars those pipelines from sharing such information with 

third parties with whom they would normally share operational information for that 

purpose (e.g., interconnected intrastate and gathering lines).126 

93. Enable also contends that the NOPR’s No-Conduit Rule creates two classifications 

of “non-public, operational information” and different rules regarding interstate 

pipelines’ sharing of each, thereby imposing significant administrative burdens and 

compliance challenges on the pipelines.127 Enable states that under the current rules, 

interstate pipelines may exchange information with employees of their intrastate pipeline 

and gathering affiliates, provided those employees are not marketing function employees. 

Enable states that the proposed No-Conduit Rule creates an inconsistency and potential 

compliance difficulty because these employees of the non-jurisdictional affiliates would 

be allowed to receive some operational information but not the new category of nonpublic information received from electric public utilities.128 Enable states that the 

proposed No-Conduit Rule renders impractical—if not impossible—interstate pipelines’ 

otherwise-appropriate sharing of non-marketing function employees with affiliated 

 125 Id.

126 Id.

127 Id. at 7.

128 Id.
Docket No. RM13-17-000 - 62 -

intrastate pipelines and gatherers.129 Additionally, Enable states that interstate pipelines 

will need to implement two separate compliance walls regarding operational information: 

one wall to prevent the disclosure of non-public transmission function information or 

customer information (directly or through a conduit) to the pipeline’s marketing function 

employees; and another wall to prevent the disclosure of non-public, operational 

information received from public utilities to the pipeline’s marketing function employees

or to any third party (including the pipeline’s own intrastate pipeline and gathering 

affiliates).130 

94. Enable maintains that the NOPR does not identify a need for the absolute 

prohibition against interstate pipelines’ disclosure of operational information to nonmarketing function employee third parties for the purpose of system reliability.131 Enable 

argues that the NOPR points only to the theoretical threat of harmful disclosure of the 

electric public utility’s non-public information and undue discrimination or preference 

 129 Id. at 8.

130 Id.

131 Id. at 9 (citing National Fuel Gas Supply Corp. v. FERC, 468 F.3d 831, 844 

(D.C. Cir. 2006) (indicating that FERC must supply a factual basis for its administrative 

actions or, in the absence of such a basis, explain how potential dangers, unsupported by 

a record of abuse, justifies costly rules); 5 U.S.C. § 553(c) (“After consideration of the 

relevant matter presented [through notice and comment], the agency shall incorporate in 

the rules adopted a concise general statement of their basis and purpose.”); Motor Vehicle 

Mfrs. Ass’n of U.S, Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 56 (1983) 

(requiring agency to explain reasons for decision); St. James Hosp. v. Heckler, 760 F.2d 

1460, 1469 (7th Cir. 1985) (finding explanation for rule not adequately supported by 

evidence offered as justification)).
Docket No. RM13-17-000 - 63 -

and provides no explanation of how the potential danger of improper disclosure by 

interstate pipelines, unsupported by a record of abuse, justifies such a broad and 

burdensome prophylactic rule. 

95. AGA and Duke Energy express concern that the proposed No-Conduit Rule could 

be interpreted to prohibit communications that are currently permitted under the 

Standards of Conduct.132 Specifically, AGA and Duke maintain the rule should not 

prevent a public utility or interstate pipeline from disclosing non-public, operational 

information to a third-party LDC, especially where such information would promote 

reliable service or operational planning with regard to gas-fired generators located on an 

LDC’s system.

b. Commission Determination

96. As stated above, the Commission adopts the No-Conduit Rule as set forth in the 

NOPR, without modification. The non-public, operational information permitted to be 

shared under this Final Rule could include the exchange of confidential generator 

information, and as explained below, the scope of the information allowed to be shared 

under this Final Rule warrants the restrictions in the No-Conduit Rule, as proposed. 

97. AGA, Duke Energy and Enable request exceptions to the third party restriction in 

the No-Conduit Rule. The Commission denies these requests. As stated earlier, the NoConduit Rule does not prohibit transmission operators from sharing their own operational 

information with other interconnecting entities involved in ensuring the reliability of 

 132 AGA Comments at 7, Duke Energy Comments at 3.
Docket No. RM13-17-000 - 64 -

system operations, such as LDCs, intrastate pipelines or gathering facilities. The NoConduit Rule only applies to the subsequent disclosure of non-public, operational 

information, including commercially sensitive, customer-specific information, received 

by an interstate natural gas pipeline or electric transmission operator under the rule and 

does not otherwise affect the ability of an interstate natural gas pipeline or electric 

transmission operator to exchange operational information about its own system with its 

customers/stakeholders or members under the same rules and conditions as it currently 

does. Moreover, the information that may permissibly be shared under this rule is not 

limited to “transmission function” information covered under the Standards of Conduct. 

The scope of information that transmission operators may permissibly share under this

rule is broader than transmission function information and, as a result therefore warrants 

the restriction on disclosure to third parties, as well as marketing function employees, via 

the No-Conduit Rule. 

98. The Commission similarly denies NE Gas Industry’s and INGAA’s requests that, 

if the Commission does not eliminate the third-party prohibition, the Commission at least 

include an exception to permit sharing of non-public, operational information between all

relevant industry participants during emergencies. We see little reason to create an 

emergency exception since, as we explained, the Final Rule does not otherwise affect the 

ability of an interstate natural gas pipeline or electric transmission operator to exchange 

operational information about its own system with its customers/stakeholders or members 

under the same rules and conditions as it is currently does, including during an 

emergency. In addition, the Commission clarifies that the proposed No-Conduit Rule 
Docket No. RM13-17-000 - 65 -

does not prohibit, either during routine or emergency circumstances, electric transmission 

or interstate natural gas pipeline operators from jointly and simultaneously 

communicating non-public, operational transmission or transportation information 

(except for customer-specific information) with all market participants. Because such 

information is being shared contemporaneously with all market participants, it would not 

be considered non-public and its disclosure would not be unduly preferential or 

discriminatory. Undue discrimination concerns only arise when communications take 

place with some, but not all, market participants. 

99. Enable is concerned that the proposed No-Conduit Rule creates a new compliance 

issue for pipeline companies that have operational personnel who are involved in 

operational planning for an interstate pipeline and affiliated gathering facilities or 

intrastate pipelines. While the No-Conduit Rule would prohibit such disclosures to the 

employees shared with the affiliated gathering facilities or intrastate pipeline, we do not 

find that a broad exemption for communication of the non-public, operational 

information is warranted. To the extent that interstate natural gas pipelines share 

operational employees with LDCs or other affiliates, which makes compliance with the 

No-Conduit Rule difficult, the interstate natural gas pipelines can seek a waiver of this 

Final Rule’s No-Conduit Rule.
Docket No. RM13-17-000 - 66 -

III. Questions Posed by the Commission

A. Generator to Electric Transmission Operator Communications

1. NOPR

100. In the NOPR, the Commission recognized that although the proposal applies only 

to communications between interstate natural gas pipelines and electric transmission 

operators, natural gas-fired generators may have relevant information regarding their own 

capabilities to acquire natural gas (or other fuels) not available to the interstate natural 

gas pipeline serving the generator.133 Therefore, the Commission sought comments on 

whether additional regulations were needed to require a generator to inform its electric 

transmission operator of the possibility its natural gas service may be disrupted. As an 

example, the Commission asked whether a generator should be required, at the request of 

the electric transmission operator, to provide its electric transmission operator with 

information pertaining to any communications received from an interstate natural gas 

pipeline regarding potential failures by the generator to conform to flow rates or 

nominations.

2. Comments 

101. EEI, EPSA, MISO, MMWEC, NEPGA, NRECA, and PG&E believe that 

additional regulations requiring information sharing between generators and electric 

 133 NOPR, FERC Stats. & Regs. ¶ 32,699 at P 25 (cross-referenced at 144 FERC 

¶ 61,043).
Docket No. RM13-17-000 - 67 -

transmission operators are not necessary.134 On the other hand, the IRC, ISO-NE, 

NYISO, and NYPSC support additional regulations requiring generators to share 

information regarding their fuel status with an electric transmission operator.135 

Likewise, in the absence of cooperative information sharing, APPA, MMWEC, NRECA 

and the NE Gas Industry believe that additional regulations should be implemented to 

ensure information sharing.136 

102. Along the same lines, TVA and Ohio PUC believe that electric transmission 

operators should be allowed to require any critical information that may impact electric 

reliability.137 

103. In support of such a requirement, NYISO states that, while it expects that its 

generators will react to fuel availability concerns by derating their capacity when 

circumstances dictate, additional detailed information, particularly during cold weather 

events, is desirable.138 Similarly, ISO-NE states that although it often learns about gas 

 134 EEI Comments at 5-6; EPSA Comments at 4-5; MISO Comments at 4; 

MMWEC Comments at 4; NEPGA Comments at 4-5; NRECA Comments at 8; PG&E 

Comments at 5.

135 IRC Comments at 4, ISO-NE Comments at 8-9, NYISO Comments at 2; 

NYPSC Comments at 5. NYPSC states that if the Commission requires a generator to 

provide its electric transmission operator communications received from a natural gas 

pipeline, the NYPSC would also include communications from the LDC. NYPSC at 4-5.

136 APPA Comments at 7, NRECA Comments at 8, NE Gas Industry Comments 

at 9; MMWEC at 4.

137 TVA Comments at 3; Ohio PUC Comments at 7.

138 NYISO Comments at 4.
Docket No. RM13-17-000 - 68 -

interruptions only after a generator is offline, it understands that information regarding 

potential interruptions due to insufficient gas supply is available much earlier.139 

104. CAISO and EEI point out that some electric transmission operators already have 

the ability to work with their stakeholders and/or to file tariff changes that may be 

necessary to require generators to provide this information.140 CAISO, EEI, EPSA, IRC, 

MISO, and NEPGA also point out that some electric transmission operators already 

require generators to share this type of information.141 EEI, for example, states that PJM 

Interconnection L.L.C. (PJM) already requires capacity resources to report fuel data to 

enable PJM to assist the market in providing solutions in emergency situations.142 

NEPGA stated that, under the ISO-NE tariff, generators have an existing obligation to 

report to ISO-NE when they are unable to operate due to pipeline disruptions or 

otherwise.143 Similarly, MISO states that in its markets, generator owners and/or 

operators are required to notify MISO of anticipated fuel supply disruptions.144 CAISO 

states that its tariff currently requires generators to inform it of any change or potential 

 139 ISO-NE Comments at 8-9.

140 EEI Comments at 5-6.

141 EEI Comments at 5-6, EPSA Comments at 4; NEPGA Comments at 4-5, MISO 

Comments at 4; CAISO Comments at 4.

142 EEI Comments at 5 (citing PJM Manual 13, Emergency Operations, 

Section 6.4 Fuel Limitation Reporting. Effective date June 1, 2013).

143 NEPGA Comments at 4.

144 MISO Comments at 4.
Docket No. RM13-17-000 - 69 -

change in the generators status, including any fuel supply concerns of which the 

generator is aware.145 EPSA asserts that each transmission operator already has rules 

regarding communication between the transmission operator and generators which 

obligates generators to provide the type of information discussed in the NOPR.146 IRC 

notes that providing electric transmission operators with timely information regarding a 

generator’s fuel status is consistent with existing reliability standards.147 CAISO states 

that, if the Commission adopts a regulation applicable to generators, it should apply that 

requirement across all fuel types.148

3. Commission Determination

105. Based upon the comments received, the Commission finds that it is unnecessary in 

this proceeding to require a generator to notify its electric transmission operator that its 

natural gas service may be disrupted. However, to the extent they do not already exist, 

electric transmission operators may file tariff provisions pursuant to FPA section 205 to 

require generators to notify electric transmission operators of information they require to 

maintain reliable service, such as anticipated fuel supply disruptions. As noted by several 

commenters, some electric transmission operator tariffs require generators to notify 

 145 CAISO Comments at 4.

146 EPSA Comments at 5.

147 IRC Comments at n.7 (citing reliability standards EOP-001, EOP-004, 

IRO-010, and TOP-002).

148 CAISO Comments at 4.
Docket No. RM13-17-000 - 70 -

electric transmission operators of anticipated fuel supply disruptions. While some 

entities would prefer that the Commission adopt generic regulations requiring the 

provision of this type of information from a generator to an electric transmission 

operator, those entities do not explain why current tariff requirements are, or new tariff 

requirements would be, inadequate. Consistent with the Final Rule, this approach would 

give electric transmission operators significant flexibility to determine what information 

they require from generators to promote reliable service on their systems. 

B. Three-Way Communication of Non-Public Operational Information

1. NOPR

106. In the NOPR, the Commission sought comments on whether the proposed rule 

should require transmission operators to include the customer as part of a three-way 

communication to the extent the non-public, operational information exchanged between 

transmission operators involves customer-specific information (such as information about 

individual generators) and if so, how such a requirement could be implemented.149 

2. Comments

107. Commenters were split on this issue, with slightly more commenters opposed to 

requiring three-way communications when customer-specific information is shared. 

 149 NOPR, FERC Stats. & Regs. ¶ 32,699 at P 25 (cross-referenced at 144 FERC 

¶ 61,043). 
Docket No. RM13-17-000 - 71 -

AEP, APPA, Duke, EEI, EPSA, MMWEC, NERC, NEGPA, and NRECA support 

requiring three-way communications, 150 while CAISO, INGAA, ISO-NE, IRC, MISO, 

NE Gas Industry, NYISO, NYTO, PG&E and Washington Gas oppose such a 

requirement.151 

108. Many of the commenters that support such a requirement contend that including 

the relevant customer or generator would prove more efficient, as well as ensure the 

accuracy of the communications. NEPGA contends that generator access to these 

communications is vital to allow the generator to guarantee that the transmission operator 

does not take dispatch actions based on incomplete information held by either the 

interstate natural gas pipeline or electric transmission operator.152 EEI, for example, 

notes that a public utility would not know if a generator has back-up supply or other fuel 

arrangements without contacting the generator.153 NRECA states that involving 

individual customers could prove more efficient than excluding them from the sharing of 

their information because individual customers and generators can have information 

 150 AEP Comments at 5-6; APPA Comments at 6-7; Duke Comments at 4; EEI 

Comments at 6; EPSA Comments at 6-7; MMWEC Comments at 5; NERC Comments at 

8; NEGPA Comments at 5-6; NRECA Comments at 5-6.

151 CAISO Comments at 4-5;INGAA Comments at 5; ISO-NE Comments at 9-10; 

IRC Comments at 5; MISO Comments at 4-5; NE Natural Gas Industry Comments at 9; 

NYISO Comments at 4; NYTO Comments at 8-9; PG&E Comments at 5-6, and 

Washington Gas Comments at 9.

152 NEPGA Comments at 5.

153 EEI Comments at 6.
Docket No. RM13-17-000 - 72 -

relevant to operations that transmission operators do not have or do not have available as 

early in time as the individual customers and generators.154 Duke and EPSA believe that, 

in the event transmission operators cannot contact the customer prior to sharing 

customer-specific information, the transmission operators must inform the generator of 

what information was shared so that the generator can respond to or correct any 

misinformation.155 AEP argues that a stakeholder’s non-public data should only be 

shared with the explicit consent of that stakeholder.156

109. Many of the commenters that oppose such a requirement maintain that requiring 

three-way communications would prove impracticable and hamper reliability. The IRC 

and ISO-NE express concern that including generators in the discussions with pipelines 

and electric transmission operators would be inappropriate and difficult to implement for 

real-time operations when decisions need to be made quickly.157 The IRC and ISO-NE 

also state that gas and electric system contingencies usually affect multiple generators 

receiving gas from one interstate natural gas pipeline that are competitors with each 

other. They argue that it may not be practical in real-time to schedule separate 

discussions with each generator and to the extent discussions involved multiple 

generators, it would be inappropriate to discuss confidential, generator-specific 

 154 NRECA Comments at 6.

155 Duke Comments at 4; EPSA Comments at 6-7.

156 AEP Comments at 5.

157 ISO-NE Comments at 9; IRC Comments at 5.
Docket No. RM13-17-000 - 73 -

information with other generators.158 INGAA and the NE Gas Industry believe that such

a requirement would serve to limit conversations and have a chilling effect on 

communications the Commission intends to foster through the proposed regulations.159 

110. Likewise, PG&E states that its gas transmission operators already communicate 

daily with CAISO and incorporating every individual customer into these calls would be 

logistically difficult and hamper effective communications with CAISO.160 PG&E also 

asserts that such communications may be unnecessary, as their gas transmission operators 

already communicate daily with their generation customers and as a result, those 

customers are frequently informed regarding relevant non-public, operational 

information. 

111. The NYTOs are also concerned that such three-way conversations may 

unnecessarily result in the disclosure of market sensitive information to generators or fuel 

managers.161 Similarly, Washington Gas argues that the NOPR has not made a 

convincing case for giving one class of shipper preferential access to non-public pipeline 

information in a three-way meeting.162 Washington Gas argues that if a need exists for 

three-party communications, the pipeline could arrange “all shipper” meetings, which 

 158 ISO-NE Comments at 9-10; IRC Comments at 5.

159 INGAA Comments at 5; NE Gas Industry Comments at 9.

160 PG&E Comments at 5-6.

161 NYTOs Comments at 9.

162 Washington Gas Comments at 9.
Docket No. RM13-17-000 - 74 -

have been used for the release of critical information since open access and are often 

supplemented by handouts simultaneously posted on electronic bulletin boards (EBBs).

112. Several commenters, including MISO, NYISO, NYTO, INGAA and NE Gas 

Industry, oppose a mandatory three-way communication rule but acknowledge the value 

of three-way communication in some situations and thus, support a permissive approach 

to three-way communications.163 For instance, the NYISO states that it may be 

appropriate to have three-way communications regarding the availability of gas 

transmission capability, particularly if the generator’s dispatch is critical to reliability, but 

stresses that transmission operators need flexibility in deciding whether to include 

generators in different circumstances. 164 The NYTOs believe that electric generators and 

their fuel managers are the sole source of reliable information about many fuel-related 

concerns and should be permitted to participate in three-way communications involving 

those concerns, especially during emergency conditions. However, the NYTOs state 

there is the potential for misuse of non-public, operational information to the extent it is 

shared as part of three-way communications since generators and their fuel managers are 

merchant entities in New York. Thus, the NYTOs maintain that the NOPR’s proposed 

No-Conduit Rule should be extended to the generator and fuel manager in those instances 

and the Commission should clarify that the generator and fuel manager may not enter into 

 163 NYISO Comments at 4; NE Gas Industry Comments at 9; NYTOs at 9; and 

INGAA Comments at 5.

164 NYISO Comments at 4.
Docket No. RM13-17-000 - 75 -

unrelated transactions based upon such information.165 NE Gas Industry argues that 

generators should be included in broader industry communications in the event of an 

emergency.166 MISO suggests that, rather than require mandatory three-way 

communications, necessary information could be shared through alternate means such as 

through a designated representative or EBB.167 WGL suggests that rather than engage in 

three-way communications, all shippers could be given the opportunity to receive critical 

information simultaneously either by phone, webcast or in person.168 

113. Regarding implementation of a requirement for three-way communications, 

commenters suggest various approaches. EEI suggests that public utilities and pipelines 

should discuss with stakeholders the best way to enact such a requirement in the various 

regions.169 TVA suggests that NERC and NAESB standards could serve as 

implementation mechanisms with allowances for regional differences through organized 

market rules.170 

114. AEP recommends the use of three-party confidentiality agreements that include 

the electric generators, interstate natural gas pipelines and electric transmission operators 

 165 NYTO Comments at 8-9.

166 NE Gas Industry Comments at 9.

167 MISO Comments at 5.

168 WGL Comments at 9.

169 EEI Comments at 6.

170 TVA Comments at 3.
Docket No. RM13-17-000 - 76 -

or, in lieu of a confidentiality agreement, commercially sensitive data should be handled 

in a manner in which the generator is the central point of contact, i.e., only the generator 

would have “all of the information regarding commercially sensitive fuel supply options, 

gas transportation contracts, power obligations, etc.”171 NRECA suggests that either 

electric transmission operators have in place a non-disclosure agreement, through which 

customers could pre-approve timely sharing of their non-public information provided 

they are made aware of the disclosure within a reasonable period of time, or the adoption 

of notice provisions by electric transmission operators and pipelines, “whereby disclosure 

will not be made until the customer is provided with notice and opportunity to oppose the 

release (e.g., 5 days).”172 

3. Commission Determination

115. The Commission will not require three-way communications when customerspecific information is shared between electric transmission owners and interstate natural 

gas pipelines. The Commission is concerned that implementing such a requirement 

would prove impracticable and could discourage interstate natural gas pipelines and 

electric transmission operators from sharing valuable information. Moreover, the 

inclusion of the No-Conduit Rule in this Final Rule should ensure that any customerspecific information shared between transmission operators is not disclosed to other 

 171 AEP Comments at 6.

172 NRECA Comments at 5-6.
Docket No. RM13-17-000 - 77 -

market participants, addressing many of the concerns of those commenters supporting a 

three-way communication requirement. 

116. The Commission is also concerned that three-way communications conducted 

with one customer could result in the electric transmission operator or interstate natural 

gas pipeline inadvertently sharing non-public, operational information with only that 

customer. Selectively sharing information with a limited class of shippers or market 

participants without a rational justification could be characterized as permitting a public 

utility or interstate natural gas pipeline to make or grant an undue preference. Further, as 

noted in the NOPR, transmission operators may always discuss customer-specific 

information with the relevant customer and transmission operators but cannot deviate 

from the terms of their tariffs and cannot operate in an unduly discriminatory manner.

C. Examples of Non-Public Operational Information

1. NOPR

117. In the NOPR, the Commission stated that the term “non-public, operational 

information” is information that is not publicly posted, yet helps transmission operators 

to operate and maintain either a reliable pipeline system or a reliable electric transmission 

system.173 The Commission noted that non-public, operational information may also 

include generator, pipeline, or transmission-specific information. The Commission 

further stated that, in using the term “non-public, operational information,” the 

 173 NOPR, FERC Stats. & Regs. ¶ 32,699 at P 23 (cross-referenced at144 FERC 

¶ 61,043).
Docket No. RM13-17-000 - 78 -

Commission intended that transmission operators would be permitted to share 

information dealing with actual, anticipated, or potential effects on the ability to provide 

electric and gas service based on the respective operator’s experience and understanding 

of the operational capability and customer demands on their respective systems. 

118. The Commission provided examples of the types of information that non-public, 

operational information could include, but emphasized in the NOPR that the Commission 

was not proposing a specific list of information that can be shared in order to provide 

flexibility to individual operators. Examples of such information included, but were not 

limited to, the following types of information: 

• real-time and anticipated system conditions that have or are anticipated to impact 

natural gas transportation by changing near term gas flows; 

• actual and anticipated electric service interruptions to gas compressor locations;

• verification that there is sufficient pipeline operational capability available at a 

specific delivery point to change the quantity of natural gas delivered to the 

generator as identified by the electric transmission operator; 

• actual and projected gas transportation restrictions to electric generators; 

• real-time actual flow and operational capacity data at all receipt and delivery 

points; real-time pipeline pressure at all receipt and delivery points; 

• nominated and scheduled quantities of shippers who are or who supply gas-fired

generators; and, 
Docket No. RM13-17-000 - 79 -

• scheduled dates and duration of generator, pipeline, and transmission maintenance 

and planned outages.

The Commission sought comment on the specific categories of information identified.

2. Comments

119. EEI, NERC, NYISO, CAISO, APPA and IRC support the examples of non-public, 

operational information provided in the NOPR.174 IRC states that, as a general matter, 

the more information that interstate natural gas pipelines can provide the electric 

transmission operator regarding pipeline system conditions, the better position the 

electric transmission operator will be in to use that information to address system 

contingencies.175 EEI states that the NOPR’s general definition and examples of nonpublic, operational information provide sufficient guidance to public utilities and 

interstate natural gas pipelines as to the types of information that the Commission 

contemplates could be conveyed under the proposal.176 

120. Some commenters provide comments specific to the examples included in the 

NOPR and describe in detail the importance of particular categories of information for 

 174 EEI Comments at 4-5; NERC Comments at 7; NYISO Comments at 3; CAISO 

Comments at 3; APPA Comments at 5; and IRC Comments at 3.

175 IRC Comments at 3.

176 EEI Comments at 4-5.
Docket No. RM13-17-000 - 80 -

promoting reliable service or operational planning.177 Other commenters express concern 

with some of the examples of non-public, operational information provided in the 

NOPR.178 Some commenters also recommend that other types of information be shared 

in addition to the examples listed in the NOPR.179 

121. A few commenters request clarification regarding the list of examples in the 

NOPR, or propose modifications to the list of examples in the NOPR.180 The NYTOs, 

for example, request that the Commission clarify that RTOs and ISOs are permitted to 

share unit-specific, generator dispatch schedules with interstate natural gas pipelines (and 

LDCs) for the purpose of promoting reliable service or operational planning, subject to 

the No-Conduit Rule.181 In addition, INGAA seeks further clarification regarding what 

non-public, operational information regarding future “operational planning” transmission 

operators may share under the proposed rule. 182 

 177 See e.g., ISO-NE Comments at 5-8; ITC Comments at 4; NERC Comments 

at 7; NYISO Comments at 3; ISO-NE Comments at 4-8; Washington Gas Comments at; 

and NGSA Comments at 6-7.

178 See, e.g., NE Gas Industry Comments at 8; NGSA Comments at 7.

179 ITC Comments at 4; NYISO Comments at 3-4; NYPSC Comments at 6.

180 NERC Comments at 7; NYPSC Comments at 4.

181 NYTOs Comments at 7-8. 

182 INGAA Comments at 4.
Docket No. RM13-17-000 - 81 -

122. Finally, PGC and Washington Gas state that many of the examples of 

information proposed to be shared between pipelines and transmission operators could be 

made public and shared with all market participants.183 

3. Commission Determination

123. The Commission finds that the term “non-public, operational information” is 

sufficiently clear to describe the information that may be shared under this Final Rule. 

The examples provide guidance to public utilities and interstate natural gas pipelines as to 

the types of information that may be communicated under the rule. In general, we 

respond to comments regarding the specific list of examples provided in the NOPR with 

the guidance that we expect transmission operators to exchange that information which

they find relevant to promote reliable service or operational planning on their systems. 

As explained in the NOPR, and reaffirmed here, the Commission is providing flexibility 

to transmission operators—who have the most insight and knowledge of their systems—

to determine what non-public, operational information, if any, they deem valuable to 

maintain the reliability and integrity of their systems. 

124. Regarding concerns of onerous requests by one transmission operator to another, 

we reiterate that the communications permitted under the Final Rule are voluntary and to 

the extent a transmission operator chooses not to share the requested non-public, 

operational information, the transmission operator is free to do so. For example, the 

Commission does not anticipate that an interstate natural gas pipeline will automatically 

 183 PGC Comments at 3 and 4; Washington Gas Comments at 2-4. 
Docket No. RM13-17-000 - 82 -

share with an electric transmission operator all of the pipeline’s non-public operational 

information in its possession. Rather, the interstate natural gas pipeline will share nonpublic operational information as necessary to promote reliable service and operational 

planning. 

125. In response to PGC and Washington Gas, the Commission disagrees that the nonpublic, operational information transmission operators are permitted to share with one 

another should generally be made public. The Commission is providing explicit 

authority to transmission operators to exchange confidential and potentially commercially 

sensitive information, including generator-specific information, with one another for the 

purpose of promoting reliable service or operational planning. As discussed in more 

detail infra, the Commission is adopting a No-Conduit Rule due to concerns regarding 

the improper use of such information if disclosed to a third party or to a transmission 

operator’s marketing function employees.

IV. Clarification Regarding Table-Top Exercises

A. NOPR

126. In the NOPR, the Commission provided clarification of the applicability of the 

Standards of Conduct and statutory prohibition against undue discrimination to 

exchanges of information with regard to table-top exercises involving market affiliates of 

transmission providers and inter-industry participants.184 The Commission clarified that, 

 184 NOPR, FERC Stats. & Regs. ¶ 32,699 at PP 20-21 (cross-referenced at 

144 FERC ¶ 61,043).
Docket No. RM13-17-000 - 83 -

under the Standards of Conduct, marketing function employees may participate in tabletop exercises that include a wide range of industry participants who will have equal 

access to non-public transmission information. However, the Commission re-emphasized 

that non-public transmission information cannot be provided during private table-top 

exercises involving only the transmission provider and marketing function employees 

since they would receive preferential access to non-public transmission information or 

preferential access to transmission facilities.

B. Comments

127. EEI and NGSA request that the Commission clarify the meaning of a “tabletop 

exercise.”185 EEI also requests that the Commission clarify that marketing function 

employees can continue to participate in these exercises without violating the No-Conduit 

Rule in the NOPR.186 NGSA also requests that the Commission clarify that 

commercially sensitive information should not be disclosed at these events without 

consent of the relevant companies.187 

C. Commission Determination

128. As used in the NOPR, the term “table-top exercise” refers to an exercise used to 

assess inter- or intra-industry coordination and communications, usually during an 

emergency situation. For example, the NYTOs stated in earlier comments that the 

 185 EEI Comments at 7; NGSA Comments at 11.

186 EEI Comments at 7.

187 NGSA Comments at 11.
Docket No. RM13-17-000 - 84 -

electric and gas industries in New York regularly participate in separate “tabletop” 

reliability drills. They stated that the NYISO and NYTOs conduct drills prior to each 

summer season to simulate the restoration of service after a gas supply-related outage and 

the Northeast Gas Association holds annual emergency communications exercises among 

gas utilities and interstate pipelines serving the northeast that simulate conditions 

following major system emergencies.188 

129. As requested by EEI, we clarify that under the Standards of Conduct and under the 

Final Rule, marketing function employees may participate in table-top exercises that 

include a wide range of industry participants who will have equal access to non-public 

transmission or operational information. However, non-public transmission or 

operational information cannot be provided during private table-top exercises involving 

only the transmission provider or operator and marketing function employees since they 

would receive preferential access to non-public transmission or operational information 

or preferential access to transmission facilities. 

130. The Commission also clarifies that, under the Standards of Conduct and the Final 

Rule, the disclosure of commercially sensitive, customer-specific information at these 

events is not permitted without the consent of the relevant entities. 

 188 NYTOs Comments, Docket No. AD12-12-000, at 5 (filed Jan. 7, 2013).
Docket No. RM13-17-000 - 85 -

V. Miscellaneous

A. Monitoring, Existing Tariff Requirements, Document Destruction

1. Comments

131. AEP requests that the Commission designate an entity to ensure that reliability and 

market protections are in place because of the potential for disagreement between the two 

industries with regard to confidential information sharing.189

132. NRECA states that the Commission should maintain in the Final Rule the explicit 

requirement that “to the extent that an electric transmission operator or interstate natural 

gas pipeline has a tariff provision which precludes a communication that would otherwise 

be authorized under the proposed regulations, it [must] make a filing under the FPA or 

NGA to revise that provision to permit such exchanges of information."190 However, 

NRECA states that the Commission should clarify that to the extent market participants’ 

confidential information is required by tariff to be protected from public disclosure, the 

Final Rule in this proceeding cannot be deemed to supersede those tariff provisions.191 

NRECA states that in addition to protecting against disclosure of confidential information 

which is subject to existing tariff provisions, the Final Rule should also provide assurance 

that existing notice provisions regarding disclosure of confidential information will be 

 189 AEP Comments at 7.

190 NRECA Comments at 5 (citing NOPR, FERC Stats. & Regs. ¶ 32,699 at 

P 10 (cross-referenced at 144 FERC ¶ 61,043).

191 NRECA provides as an example PJM’s Amended and Restated Operating 

Agreement which prohibits disclosure of confidential information except in defined 

circumstances, including to NERC and applicable regional entities for reliability.
Docket No. RM13-17-000 - 86 -

followed for sharing of non-pubic operational information.192 NRECA states that the 

Final Rule should adopt the Commission’s proposal to clarify that existing tariffs must be 

complied with absent a Commission-approved revision.

133. NEPGA asserts that the Commission should establish rules for the destruction or 

return of written or recorded information within six months to protect generators’ 

commercial interests.193 NEPGA contends that this requirement is an important 

protection against the potentially harmful effects of the distribution of generator-specific, 

commercially sensitive information.

2. Commission Determination

134. In response to AEP, the Commission reaffirms that the communications permitted 

under the Final Rule are voluntary and that to the extent a transmission operator chooses 

not to share the requested non-public, operational information, the transmission operator 

is free to do so. To the extent this voluntary approach proves inadequate to promote 

reliable service or operational planning, the Commission may revisit the need to require 

certain communications or information sharing between transmission operators in the 

future. However, the Commission finds that providing explicit authority to transmission 

operators—who have the most insight and knowledge of their systems—to share nonpublic, operational information with each other will promote reliable service or 

 192 NRECA states that PJM’s Operating Agreement requires notice to the affected 

Member before PJM can make any disclosure of confidential information if required by 

law.

193 NEPGA Comments at 3-4.
Docket No. RM13-17-000 - 87 -

operational planning on both the public utility’s and pipeline’s system. Furthermore, the 

Commission declines to adopt AEP’s proposal to designate an entity to supervise 

interstate natural gas pipeline-electric transmission operator communications. We see no 

need for such supervision of this voluntary information sharing program at this time. 

With regard to requests for added market protections, as discussed above, we conclude 

that the No-Conduit Rule, together with the requirements that natural gas pipelines and 

electric transmission operators abide by their tariffs, provides a reasonable balance 

between the exchange of important information and protection against the disclosure of 

non-public operational information, including confidential information.

135. In response to NRECA’s comments regarding the relationship of this Final Rule to 

existing tariff provisions, we note that this Final Rule does not supersede any existing 

tariff provisions. 194 Thus, to the extent an electric transmission operator or interstate 

natural gas pipeline has an existing tariff provision that precludes a communication that 

would otherwise be authorized under the regulations adopted here, before it may share 

such precluded information under the express authorization provided in this Final Rule, it 

must make a filing under the FPA or NGA to revise that provision to permit such 

exchanges of information. In short, if a transmission operator wants to take advantage of 

the explicit authority provided by the Commission under the Final Rule, and that 

transmission operator has tariff provisions prohibiting the communications permitted 

 194 Regulation of Short-Term Natural Gas Transportation Services, and 

Regulation of Interstate Natural Gas Transportation Services, 101 FERC ¶ 61,127, at P 

36 (2002).
Docket No. RM13-17-000 - 88 -

under this rule, it must make a filing with the Commission to revise the relevant tariff 

provisions to permit such exchanges of information. Similarly, we clarify that any

existing tariff provisions requiring notice regarding the disclosure of confidential 

information, including the non-public, operational information at issue here, remain in 

place unless proposed revisions to those tariffs are approved by the Commission. 

136. In response to NEPGA, the Commission declines to generically establish rules for 

the destruction or return of written or recorded information within six months to protect 

generator’s commercial interests. As discussed previously, the Commission is adopting a 

No-Conduit Rule which, together with the requirements that natural gas pipelines and 

electric transmission operators abide by their tariffs, should adequately protect against the 

harmful disclosure or distribution of non-public operational information, including 

generator-specific, commercially sensitive information. 

B. Costs of Information Sharing

1. Comments

137. ELCON suggests that Commission require natural gas pipelines and electric 

transmission operators to account for the costs of information sharing.195 ELCON 

requests that the Commission direct natural gas pipelines and electric transmission 

operators to not incur costs that are not commensurate with an identified benefit. 

ELCON suggests that the NOPR’s flexibility and non-binding examples of information

sharing raise the specter that the Commission contemplates implementation of extensive 

 195 ELCON Comments at 2-3. 
Docket No. RM13-17-000 - 89 -

information sharing systems whose costs outweigh the benefits to system reliability and 

contingency planning. ELCON requests that the Commission explicitly state that it is not 

intending to encourage the development and implementation of information sharing 

systems whose costs are not commensurate with their benefits.196

2. Commission Determination

138. The Commission finds that ELCON’s request for transmission operators to 

account for the costs of information sharing are premature and outside the scope of this 

Final Rule. In this Final Rule, the Commission is providing explicit authority for 

transmission operators to share non-public, operational information with each other for

the purpose of promoting reliable service or operational planning. In addition, the 

Commission reiterates that in adopting the proposed regulations, the Commission is 

providing flexibility to individual transmission operators—who have the most insight and 

knowledge of their systems—to share that information which they deem necessary to 

promote reliable service and operational planning on their system. Issues related to the 

costs of systems or procedures developed to allow for the information sharing permitted 

by this Final Rule may be appropriately raised in other proceedings, including 

transmission operators' rate cases.

 196 Id.
Docket No. RM13-17-000 - 90 -

C. Implementation

1. Comments 

139. NGSA suggests that the Commission implement its proposed rule on an interim 

basis and reassess the impacts of allowing the proposed communication between utilities 

after some experience under the new communications regime. NGSA states that this 

approach would be similar to past rulemaking proceedings such as the natural gas 

capacity release rulemaking.197 NGSA proposes that after an interim period of one year, 

transmission operators should report to the Commission what information was shared and 

how this information sharing promoted reliable service or operational planning.198 

NGSA suggests that the information would need to be provided in a manner that protects 

confidential or proprietary data. After the interim period, transmission operators would 

also report what actions were taken based on information exchanges to allow the 

Commission to more accurately assess the benefits of increased communications. NGSA 

also suggests that the Commission release a report summarizing the impacts of this 

information sharing rule and hold a technical conference for industry to assess the 

impacts of the rule. NGSA states that at the technical conference, the Commission and 

industry should assess whether: (1) the scope of allowed communications should be 

narrowe; (2) additional protections are needed to ensure commercially sensitive 

 197 NGSA Comments at 9-10 (citing Regulation of Short-Term Natural Gas 

Transportation Services and Regulation of Interstate Natural Gas Transportation 

Services, Order No. 637, FERC Stats. & Regs. ¶ 31,091 (2000) (cross-referenced at 

90 FERC ¶ 61,109 (2000))). 

198 Id. at 10. 
Docket No. RM13-17-000 - 91 -

information is not released; and (3) transmission operators should be required to publicly 

post shared information that is not commercially sensitive.199

140. NGSA suggests that the assessment and technical conference would allow the 

Commission to determine whether further improvements to the communications rules are 

needed. After receiving reports from transmission operators and pipelines, the 

Commission could consider whether some publicly available and not commercially 

sensitive communications should be publicly posted, for example, on a pipeline EBB. 

NGSA contends that the Commission could also determine whether market participants' 

information is sufficiently protected under the proposed rule. NGSA suggests that 

requiring pipelines and transmission operators to report what information they 

communicated during an interim test period will allow the Commission and industry to 

determine what additional protections might be needed. NGSA suggests that market 

participants would have greater confidence in expanded communications knowing that 

there would be an opportunity to learn what information was shared and that the 

Commission would make changes to the rule if needed.200

141. NRECA suggests that the Commission require “status report” filings by 

transmission operators to explain progress made in the sharing of non-public, operational 

information. 201 NRECA states that the reports could be part of a comprehensive 

 199 Id. at 10-11. 

200 NGSA Comments at 11. 

201 NRECA Comments at 5. 
Docket No. RM13-17-000 - 92 -

submission to be submitted at regular intervals (e.g., quarterly or semi-annually), similar 

to the reports required by RTOs and ISOs on gas-electric coordination issues, or could 

focus only on implementation of the Final Rule in this proceeding. Either way, NRECA 

suggests that the Final Rule include a mechanism for the Commission to gauge response 

and outcome of the Final Rule, and its impact on gas-electric coordination efforts.202 

142. APPA suggests that, after a period of time, the Commission could revisit its 

revised regulations in this area to determine whether it needs to further define the term 

“non-public, operational information” and to evaluate how the voluntary approach is 

working.203 PUCO also states that it would be appropriate for the Commission to 

periodically review which non-public information is shared and whether that exchange of 

information is adequate to maintain reliability.204 PUCO further states that because 

different regions will have diverse practices concerning the level and type of non-public 

information shared, the Commission should use the collection of such data to arrive at a 

proposed best practices solution that is most effective to ensure efficient operations and 

to promote reliability. NESCOE also encourages the Commission to undertake periodic 

assessments of the efficacy of the changes made in the Final Rule, the extent to which 

 202 Id.

203 APPA Comment at 5.

204 PUCO Comments at 6.
Docket No. RM13-17-000 - 93 -

impediments to communications and information sharing remain, and consider additional 

actions if needed. 205 

2. Commission Determination

143. The Commission will not adopt NGSA’s suggestion of implementing the proposed 

rule on an interim basis. The Commission is concerned that existing barriers—real or 

perceived—to the sharing of non-public, operational information could impede 

transmission operators’ ability to reliably manage the operation of interstate natural gas 

pipeline and electric transmission systems. Therefore, the Commission is taking action to 

ensure that transmission operators covered by this rule may communicate non-public, 

operational information, subject to the No-Conduit Rule.

144. The Commission declines to adopt the suggestion of NRECA, APPA, PUCO and 

NESCO that transmission operators submit status report filings describing progress made 

in the sharing of non-public, operational information. We fully expect market 

participants in both industries, as they experience the communications contemplated by 

this Final Rule, to keep the Commission informed about progress, issues and areas of 

possible improvement. We see no reason to impose a requirement for status reports at 

this time.

VI. Information Collection Statement

145. The collection of information contained in this Final Rule is being submitted to the 

Office of Management and Budget (OMB) for review under Section 3507(d) of the 

 205 NESCOE Comments at 6.
Docket No. RM13-17-000 - 94 -

Paperwork Reduction Act of 1995 (PRA).206 OMB’s regulations require approval of 

certain information collection requirements imposed by agency rule.207 Upon approval of 

a collection of information, OMB will assign an OMB control number and an expiration 

date. Respondents subject to the filing requirements of a rule will not be penalized for 

failing to respond to this collection of information if the collection of information does 

not display a valid OMB control number.

146. Public Reporting Burden: The communications and information sharing 

(described in new 18 CFR 38.2 and 18 CFR 284.12(b)(4)) are voluntary, take place 

between various industry entities (and are not submitted to the Commission), and are 

intended to promote reliable service or operational planning. In the NOPR, the 

Commission solicited comments on the need for this information and the frequency of 

providing it (number of responses per respondent). No filed comments addressed the 

proposed Information Collection Statement, including the estimated public reporting 

burden, or the proposed Regulatory Flexibility Act Certification, including the estimated 

impact on small entities. Commenters acknowledged that reliability and operational 

planning on interstate natural gas pipelines and electric transmission systems could be 

further enhanced by information sharing. While the extent of such communications 

likely will vary significantly across the country, the annual estimates represent an 

expected average and reflect the burden for operational planning and emergencies. 

 206 44 U.S.C. 3507(d) (2012).

207 5 CFR 1320.
Docket No. RM13-17-000 - 95 -

147. In the Final Rule, the Commission explains that to the extent an electric 

transmission operator or interstate natural gas pipeline has a tariff provision which 

precludes a communication that would otherwise be authorized under the proposed 

regulations, it must make a filing under section 205 of the FPA or section 4 of the NGA 

to revise that provision to permit such exchanges of information. 

148. The reporting requirements in the Final Rule include: the voluntary 

communication of non-public, operational information among interstate natural gas 

pipelines and electric transmission operators, and possibly necessary tariff filings by 

electric transmission operators and natural gas pipelines. The additional estimated annual 

burden and cost follow. 

FERC-923, Communication of Operational Information Between

Natural Gas Pipelines and Electric Transmission Operators,

Final Rule in Docket No. RM13-17208

Type of Entity

(1)

No. of 

Responden

ts

(2)

Number of 

Responses 

Per 

Respondent

(3)

Average

Burden 

Hours 

per 

Respons

Total Annual 

Burden 

Hours

(2)*(3)*(4)=(

5)

Total 

Annual 

Cost ($)

(5)*($

/hr)=(6)209

 208 Columns 5 and 6 are rounded.

209 For communications, the estimated hourly cost (for salary plus benefits) is 

$60.41; estimated annual costs are $125,647 (based on 2,080 hours per year). It is based 

on data from the Bureau of Labor Statistics Occupational Outlook Handbook, 2012-2013 

edition for the top 10% of “Power Plant Operators, Distributors, and Dispatchers” (at 

http://www.bls.gov/ooh/). 

For tariff filings, the average hourly cost (for salary plus benefits) is $44.25. This 

hourly estimate will be used for public utility transmission operators and interstate natural 

gas pipelines. It is based on data provided by the Bureau of Labor Statistics Occupational 

Outlook Handbook, 2012 – 2013 edition for the median for “Lawyers,” “Paralegal and 

Legal Assistants,” and “Secretaries and Administrative Support” (at 

(continued...)
Docket No. RM13-17-000 - 96 -

e

(4)

Public Utility 

Transmission 

Operator, 

communications 167210 12211 0.50 1002 $60,531

Interstate Natural 

Gas Pipelines, 

communications 137212 12 0.50 822 $49,657

Public Utility 

Transmission 

Operator (tariff 4 213 2 8214 64 $2,832

 

http://www.bls.gov/ooh/). The estimated annual costs (salary plus benefits) for Lawyers, 

Paralegal and Legal Assistance, and Secretaries and Administrative Support are 

$160,398, $66,401, and $49,303, respectively. The hourly cost (based on 2080 hours per 

year) is $77.11, $31.92 and $23.70 for the three occupations, respectively. 

For the estimate of the benefits component, see 

http://www.bls.gov/news.release/ecec.nr0.htm. 

210 The estimate for the number of respondents is based on the North American 

Electric Reliability Corporation (NERC) Compliance Registry as of April 30, 2013, 

minus the Transmission Operators within ERCOT. Using the Small Business 

Administration (SBA) definition, 31 of the 167 Public Utility Transmission Operators are 

considered “small.”

211 The Commission estimates an annual average per entity of 12 responses

(including electric and gas emergency and/or operational contacts).

212 The 2012 filings of the FERC Forms 2 and 2A indicated that there are 137 

interstate natural gas pipelines. Of those pipelines, eight (8) are considered small using 

the definition of the Small Business Administration (at 13 CFR 121.301), including the 

affiliates.

213 Of the 167 Public Utility Transmission Operators, the Commission estimates 

that four will make tariff filings.

214 The Commission estimates that the public utility transmission operator will 

require eight work hours to file the amendment to the tariff from a team that consists of a 

“Lawyer,” a “Paralegal and Legal Assistant,” and a “Secretary and Administrative 

Support.” 
Docket No. RM13-17-000 - 97 -

change)

Interstate 

Natural Gas 

Pipelines (tariff 

change) 4 215 1 8216 32

$1,416

Total 1,920 $114,436

Title: FERC-923, “Communication of Operational Information between Natural Gas 

Pipelines, and Electric Transmission Operators.” 

Action: Proposed FERC-923. 

OMB Control Nos.: 1902-0265 (FERC-923).

Respondents: Public utility transmission operators and interstate natural gas pipelines.

Frequency of Responses: FERC-923, as needed.

Necessity of the Information: In this Final Rule, the Commission is revising Parts 38 and 

284 of the Commission’s regulations to authorize interstate natural gas pipelines and 

public utilities that own, operate, or control facilities used for the transmission of electric 

energy in interstate commerce to share non-public, operational information for the 

purpose of promoting reliable service and operational planning on either the public 

utility’s or pipeline’s system. Such sharing is voluntary. 

 215 Of the 137 interstate natural gas pipelines, the Commission estimates that four 

will make tariff filings.

216 The Commission estimates that an interstate natural gas pipeline will require 

eight work hours to file the amendment to the tariff from a team that consists of a 

“Lawyer,” a “Paralegal and Legal Assistant,” and a “Secretary and Administrative 

Support.” 
Docket No. RM13-17-000 - 98 -

149. The revised regulations will help promote the reliability of pipeline and public 

utility transmission service by permitting transmission operators to share information that 

they deem necessary to promote the reliability and integrity of their systems with each 

other.

150. Internal Review: The Commission has reviewed the requirements and determined 

that the proposed amendments are necessary. These requirements conform to the 

Commission’s need for efficient information collection, communication, and 

management within the energy industry. The Commission has assured itself, by means of 

internal review, that there is specific, objective support for the burden estimates 

associated with the information collection requirements. Interested persons may obtain 

information on the reporting requirements by contacting the following: Federal Energy 

Regulatory Commission, 888 First Street, NE, Washington, DC 20426 [Attention: Ellen 

Brown, Office of the Executive Director, e-mail: DataClearance@ferc.gov, phone: 

(202) 502-8663, fax: (202) 273-0873].

151. Please send comments concerning the collection of information and the associated 

burden estimates to the Commission, and to the Office of Management and Budget, 

Office of Information and Regulatory Affairs, Washington, DC 20503 [Attention: Desk 

Officer for the Federal Energy Regulatory Commission, phone: (202) 395-4638, fax: 

(202) 395-7285]. For security reasons, comments to OMB should be submitted by e-mail 

to: oira_submission@omb.eop.gov. Comments submitted to OMB should include 

Docket Number RM13-17-000, FERC-923 (OMB Control No. 1902-0268).
Docket No. RM13-17-000 - 99 -

VII. Environmental Analysis

152. The Commission is required to prepare an Environmental Assessment or an 

Environmental Impact Statement for any action that may have a significant adverse effect 

on the human environment.217 The Commission concludes that neither an Environmental 

Assessment nor an Environmental Impact Statement is required for this Final Rule under 

section 380.4(a)(2)(ii) of the Commission’s regulations, which provides a categorical 

exemption for proposals for legislation and promulgation of rules that are clarifying, 

corrective, or procedural, or that do not substantively change the effect of legislation or 

regulations being amended.218

VIII. Regulatory Flexibility Act

153. The Regulatory Flexibility Act of 1980 (RFA)219 generally requires a description 

and analysis of rules that will have significant economic impact on a substantial number 

of small entities. The RFA mandates consideration of regulatory alternatives that 

accomplish the stated objectives of a rule and that minimize any significant economic 

impact on a substantial number of small entities. The Small Business Administration’s 

(SBA’s) Office of Size Standards develops the numerical definition of a small 

 217 Regulations Implementing the National Environmental Policy Act of 1969, 

Order No. 486, 52 FR 47897 (Dec. 17, 1987), FERC Stats. & Regs., Regulations 

Preambles 1986-1990 ¶ 30,783 (1987).

218 18 CFR 380.4(a)(2)(ii) (2013).

219 5 U.S.C. 601-612 (2012).
Docket No. RM13-17-000 - 100 -

business.220 The SBA has established a size standard, for electric utilities, electric power 

distribution, and electric bulk power transmission and control, stating that a firm is small 

if, including its affiliates, it is primarily engaged in the transmission, generation and/or 

distribution of electric energy for sale and its total electric output for the preceding fiscal 

year did not exceed four million megawatt hours.221 For pipeline transportation of 

natural gas, the SBA defines a small entity as having a maximum annual receipt of $25.5 

million dollars.222 For a “Natural Gas Distribution” company, the SBA defines a small 

entity as having less than 500 employees.223 

154. The Commission estimates a total of 39 “small” entities224 (or 12.8 percent of the 

total of 304 entities), and an average annual cost for each entity of $376.225 This 

 220 13 CFR 121.101 (2012).

221 13 CFR 121.201, Sector 22, Subsector 221, Utilities & n.1.

222 Based on 13 CFR 121.201, Sectors 48-49, Subsector 486, Pipeline 

Transportation, the annual receipts indicate the maximum allowed for a concern and its 

affiliates to be considered “small.”

223 13 CFR 121.201, Sector 22, Subsector 221, Utilities, NAICS code 221210.

224 Based on the SBA definitions and including affiliates, the number of “small” 

entities is estimated to be: (1) for public utility transmission operators, 31 small public 

utilities; and (2) for interstate natural gas pipelines, eight small interstate natural gas 

pipelines.

225 The information sharing and communications permitted in this Final Rule are

voluntary. For small entities which do not serve or take service from natural gas-fired 

electric generators, no such communications are necessary or required and their burden 

will effectively be zero. For small entities which do not wish to participate in 

communications among transmission operators serving or being served by natural gasfired electric generators, their burden is also zero.
Docket No. RM13-17-000 - 101 -

proposal will enable entities of all sizes to communicate voluntarily and to share nonpublic, operational information for the purpose of promoting reliable service or 

operational planning, thereby easing and improving the normal business process. 

Accordingly, the Commission certifies that this rule will not have a significant impact on 

a substantial number of small entities and no regulatory flexibility analysis is required. 

IX. Document Availability

155. In addition to publishing the full text of this document in the Federal Register, the 

Commission provides all interested persons an opportunity to view and/or print the 

contents of this document via the Internet through FERC's Home Page 

(http://www.ferc.gov) and in FERC's Public Reference Room during normal business 

hours (8:30 a.m. to 5:00 p.m. Eastern time) at 888 First Street, NE, Room 2A, 

Washington, DC 20426.

156. From FERC's Home Page on the Internet, this information is available on 

eLibrary. The full text of this document is available on eLibrary in PDF and Microsoft 

Word format for viewing, printing, and/or downloading. To access this document in 

eLibrary, type the docket number excluding the last three digits of this document in the 

docket number field.

157. User assistance is available for eLibrary and the FERC’s website during normal 

business hours from FERC Online Support at 202-502-6652 (toll free at 1-866-208-3676) 

or email at ferconlinesupport@ferc.gov, or the Public Reference Room at (202) 502-

8371, TTY (202) 502-8659. E-mail the Public Reference Room at 

public.referenceroom@ferc.gov.
Docket No. RM13-17-000 - 102 -

X. Effective Date and Congressional Notification

158. These regulations are effective [insert date 30 days from publication in Federal 

Register]. The incorporation by reference of certain publications in this rule is approved 

by the Director of the Federal Register as of [insert date 30 days after publication in 

the FEDERAL REGISTER]. The Commission has determined, with the concurrence 

of the Administrator of the Office of Information and Regulatory Affairs of OMB, that 

this rule is not a “major rule” as defined in section 351 of the Small Business Regulatory 

Enforcement Fairness Act of 1996.

List of Subjects

18 CFR Part 38

Conflict of interests, Electric power plants, Electric utilities, Incorporation by 

reference, Reporting and recordkeeping requirements.

18 CFR Part 284

Natural gas, Reporting and recordkeeping requirements

By the Commission.

( S E A L )

Nathaniel J. Davis, Sr.,

Deputy Secretary.
Docket No. RM13-17-000 - 103 -

In consideration of the foregoing, the Commission amends Part 38 and Part 284, 

Chapter I, Title 18, Code of Federal Regulations, as follows:

PART 38—STANDARDS FOR PUBLIC UTILITY BUSINESS OPERATIONS 

AND COMMUNICATIONS

1. The authority citation for Part 38 continues to read as follows:

Authority: 16 U.S.C. 791-825r, 2601-2645; 31 U.S.C. 9701; 42 U.S.C. 7101-

7352.

2. The heading of Part 38 is revised to read as set forth above:

§ 38.1 [Removed]

3. Remove § 38.1.

§ 38.2 [Redesignated as § 38.1 ]

4. Redesignate § 38.2 as § 38.1

5. In newly redesignated § 38.1, paragraph (a) is revised to read as follows:

§ 38.1 Incorporation by reference of North American Energy Standards Board 

Wholesale Electric Quadrant standards.

(a) Any public utility that owns, operates, or controls facilities used for the 

transmission of electric energy in interstate commerce or for the sale of electric energy at 

wholesale in interstate commerce and any non-public utility that seeks voluntary 

compliance with jurisdictional transmission tariff reciprocity conditions must comply 

with the following business practice and electronic communication standards 

promulgated by the North American Energy Standards Board Wholesale Electric 

Quadrant, which are incorporated herein by reference:
Docket No. RM13-17-000 - 104 -

* * * * *

6. New § 38.2 is added to read as follows:

§ 38.2 Communication and information sharing among public utilities and pipelines.

(a) Any public utility that owns, operates, or controls facilities used for the 

transmission of electric energy in interstate commerce is authorized to share non-public, 

operational information with a pipeline, as defined in § 284.12(b)(4) of this chapter, or 

another public utility covered by this section for the purpose of promoting reliable service 

or operational planning. 

(b) Except as permitted in paragraph (a) of this section, a public utility, as defined 

in this section, and its employees, contractors, consultants, and agents are prohibited from 

disclosing, or using anyone as a conduit for the disclosure of, non-public, operational 

information received from a pipeline pursuant to § 284.12(b)(4) of this chapter to a third 

party or to its marketing function employees as that term is defined in § 358.3(d) of this 

chapter. 

 

PART 284 – CERTAIN SALES AND TRANSPORTATION OF NATURAL GAS 

UNDER THE NATURAL GAS POLICY ACT OF 1978 AND RELATED 

AUTHORITIES

7. The authority citation for Part 284 continues to read as follows:

Authority: 15 U.S.C. 717-717z, 3301-3432; 42 U.S.C. 7101-7352; 43 U.S.C. 

1331-1356.

8. In § 284.12, paragraph (b)(4) is added to read as follows:

§ 284.12 Standards for pipeline business operations and communications.
Docket No. RM13-17-000 - 105 -

*****

(b) ***

(4) Communication and information sharing among pipelines and public utilities. 

(i) A pipeline is authorized to share non-public, operational information with a public 

utility, as defined in § 38.2(a) of this chapter or another pipeline covered by this section, 

for the purpose of promoting reliable service or operational planning.

(ii) Except as permitted in paragraph (b)(4)(i) of this section, a pipeline and its 

employees, contractors, consultants, and agents are prohibited from disclosing, or using 

anyone as a conduit for the disclosure of, non-public, operational information received

from a public utility pursuant to § 38.2 of this chapter to a third party or to its marketing 

function employees as that term is defined in § 358.3(d) of this chapter.