140 FERC ¶ 61,217 

UNITED STATES OF AMERICA 

FEDERAL ENERGY REGULATORY COMMISSION 

18 CFR Part 357 

[Docket No. RM12-18-000] 

Revisions to Page 700 of FERC Form No. 6 

(Issued September 20, 2012) 

AGENCY: Federal Energy Regulatory Commission. 

ACTION: Notice of Proposed Rulemaking. 

SUMMARY: The Federal Energy Regulatory Commission (Commission) proposes to 

modify Page 700 of FERC Form No. 6 (Form 6) to facilitate the calculation of a 

pipeline’s actual return on equity. The Commission proposes to expand the information 

provided regarding rate base (line 5), rate of return (line 6), return on rate base (line 7), 

and income tax allowance (line 8). 

DATES: Comments are due [insert 60 days after publication in the FEDERAL 

REGISTER]

ADDRESSES: Comments, identified by docket number, may be filed in the following 

ways: 

 Electronic Filing through http://www.ferc.gov. Documents created electronically 

using word processing software should be filed in native applications or print-toPDF format and not in a scanned format. 
Docket No. RM12-18-000 - 2 - 

 Mail/Hand Delivery: Those unable to file electronically may mail or hand-deliver 

comments to: Federal Energy Regulatory Commission, Secretary of the 

Commission, 888 First Street, NE, Washington, DC 20426. 

Instructions: For detailed instructions on submitting comments and additional 

information on the rulemaking process, see the Comment Procedures Section of this 

document 

FOR FURTHER INFORMATION CONTACT: 

James Sarikas (Technical Information) 

Office of Energy Market Regulation 

888 First Street, NE 

Washington, DC 20426 

(202) 502-6831 

James.Sarikas@ferc.gov

Brian Holmes (Technical Information) 

Office of Enforcement 

888 First Street, NE 

Washington, DC 20426 

(202) 502-6008 

Brian.Holmes@ferc.gov

Andrew Knudsen (Legal Information) 

Office of the General Counsel 

888 First Street, NE 

Washington, DC 20426 

(202) 502-6527 

Andrew.Knudsen@ferc.gov

SUPPLEMENTARY INFORMATION: 

 
UNITED STATES OF AMERICA 

FEDERAL ENERGY REGULATORY COMMISSION 

Revisions to Page 700 of FERC Form No. 6 Docket No. RM12-18-000 

NOTICE OF PROPOSED RULEMAKING 

TABLE OF CONTENTS 

 Paragraph Numbers 

I. Background ........................................................................................................................... 2.

II. Discussion ............................................................................................................................. 6.

A. Rate Base .......................................................................................................................... 9.

B. Rate of Return ................................................................................................................... 11.

C. Composite Tax Return ......................................................................................................13.

III. Information Collection Statement ....................................................................................... 19.

IV. Environmental Analysis ...................................................................................................... 25.

V. Regulatory Flexibility Act [Analysis Or Certification] ........................................................ 26.

VI. Comment Procedures .......................................................................................................... 27.

VII. Document Availability ....................................................................................................... 31.
140 FERC ¶ 61,217 

UNITED STATES OF AMERICA 

FEDERAL ENERGY REGULATORY COMMISSION 

Revisions to Page 700 of FERC Form No. 6 Docket No. RM12-18-000 

NOTICE OF PROPOSED RULEMAKING 

(Issued September 20, 2012) 

1. The Federal Energy Regulatory Commission (Commission) proposes to modify 

the reporting requirements on Page 700, Annual Cost of Service Based Analysis 

Schedule, of FERC Form No. 6, Annual Report of Oil Pipeline Companies (Form 6), to 

facilitate the calculation of a pipeline’s actual rate of return on equity based upon 

Page 700 data. The modifications to Page 700 include requiring additional information 

regarding rate base, rate of return, return on rate base, and income taxes.1

 

I. Background 

2. The Commission is responsible for regulating the rates, terms and conditions that 

oil pipelines charge for transportation under the Interstate Commerce Act (ICA).2

 The 

ICA prohibits pipelines from charging rates that are “unjust and unreasonable” and 

 1

 Concurrent with the issuance of this NOPR, the Commission is issuing a final 

rule in Docket No. RM11-21-000, Revision to Form No. 6. 

2

 49 USC §§ 1, et seq.
Docket No. RM12-18-000 - 2 - 

permits shippers and the Commission to challenge both pre-existing and newly filed 

rates.3

 

3. To assist the Commission in the administration of its jurisdictional responsibilities, 

the ICA authorizes the Commission to prescribe annual or other periodic reports.4

 

Through Form 6, the Commission collects annual financial information from crude and 

refined product pipelines5

 subject to the Commission’s jurisdiction, as prescribed in 

section 357.2 of the Commission’s regulations.6

 Form 6 “is intended to be both a 

financial and ratemaking document.”7

 

4. Page 700 of Form 6 provides a simplified presentation of an oil pipeline’s 

jurisdictional cost-of-service. Page 700 serves as a preliminary screening tool to evaluate 

 3

 49 USC 13(1), 15(1), (7). Just and reasonable rate are “rates yielding sufficient 

revenue to cover all proper costs, including federal income taxes, plus a specified return 

on invested capital.” City of Charlottesville v. FERC, 774 F.2d 1205, 1207 (D.C. 

Cir. 1985). 

4

 49 App. USC 1-85 (2000). 

5

 Hereafter, the term “oil pipeline” shall include both crude and refined product 

pipelines. 

6

 18 CFR 357.2 (2012). 

7 Revisions to and Electronic Filing of the FERC Form No. 6 and Related Uniform 

Systems of Accounts, Order No. 620, FERC Stats. & Regs., Regulation Preambles 

July 1996-December 2000 ¶ 31,115, at p. 31,954 (2000) (citing Cost of Service 

Requirements and Filing Requirements for Oil Pipelines, Order No. 571, FERC Stats. 

& Regs., Regulation Preambles Jan. 1991 – June 1996 ¶ 31,006, at p. 31,169 (1995) and 

Form 6, p. I, Roman Numeral 1; on reh’g, Order No. 620-A, 94 FERC 61,130 (2001); 

order on reh’g, Order No. 620-A, 94 FERC ¶ 61,130 (2001)). 
Docket No. RM12-18-000 - 3 - 

pipeline rates.8

 However, “Page 700 information alone is not intended to show what a 

just and reasonable rate should be.”9

 Currently, pipelines are required to provide the 

following on Page 700: Operating and Maintenance Expenses (line 1), Depreciation 

Expense (line 2), AFUDC Depreciation (line 3), Amortization of Deferred Earnings 

(line 4), Rate Base (line 5), Rate of Return (line 6), Return on Rate Base (line 7), Income 

Tax Allowance (line 8), Total Cost of Service (line 9), Total Interstate Operating 

Revenues (line 10), Throughput in Barrels (line 11), and Throughput in Barrel-Miles 

(line 12). 

II. Discussion 

5. The Commission proposes to modify Page 700 to more easily enable the 

calculation of a pipeline’s actual rate of return on equity consistent with the ratemaking 

principles embodied in Opinion 154-B, et al. The actual rate of return on equity reflects 

the relationship between a pipeline’s revenues and its cost of service. As a result, the 

actual rate of return on equity is particularly useful information when using Page 700 to 

evaluate whether a pipeline’s rates are just and reasonable consistent with the 

Commission’s mandate under the ICA. 

 8

 All jurisdictional pipelines are required to file page 700, including pipelines 

exempt from filing the full Form 6. 18 CFR 357.2(a)(2) and (a)(3) (2012). 

9

 Order No. 571-A, 69 FERC ¶ 61,411, at p. 31,254 (1994). 
Docket No. RM12-18-000 - 4 - 

6. To provide the data necessary to calculate the actual return on equity, Page 700 

must be modified to include additional information related to rate base, rate of return, 

return on rate base, and income tax rates. 

A. Rate Base 

7. The Commission seeks to enhance the information provided on Page 700 related 

to rate base, rate of return, and return on rate base. The components of an oil pipeline’s 

rate base are governed by the Trended Original Cost Methodology adopted by the 

Commission in Opinion No. 154-B.10 Under this methodology, a pipeline’s Rate Base 

consists of (1) the Original Cost Rate Base, (2) any unamortized amounts from the oil 

pipeline’s Starting Rate Base Write-Up (SRB),11 and (3) Accumulated Net Deferred 

Earnings.12 

 10 See Williams Pipeline Co., Opinion No. 154-B, 31 FERC ¶ 61,377 (1985), order 

on reh’g, Opinion No. 154-C, 33 FERC ¶ 61,327 (1985). Instruction No. 2 of Page 700 

of the FERC Form No. 6 requiring the values “be computed consistent with the 

Commission’s Opinion No. 154-B et al. methodology....” 

11 The Starting Rate Base Write-Up is a transitional rate base element employed to 

bridge the transition from a valuation ratemaking methodology to the Trended Original 

Cost methodology as adopted in Opinion 154-B. The SRB was to be amortized over the 

estimated life of the pipeline at the time the SRB was established. 

12 The trended original cost methodology divides the nominal return on equity 

component of the cost of service into real return and an inflationary return. The real 

return is collected in the current year. The Net Deferred Earnings consists of the inflation 

component, which is deferred to be recovered in annual installments over the remaining 

life of the pipeline. See Opinion No. 154-B, 31 FERC ¶ 61,377 (1985), order on reh’g, 

Opinion No. 154-C, 33 FERC ¶ 61,327 (1985). See, e.g., BP West Coast Prods., LLC v. 

FERC, 374 F.3d 1263, 1282-83 (D.C. Cir. 2004). 
Docket No. RM12-18-000 - 5 - 

8. Consistent with Opinion No. 154-B, the Commission proposes to enhance the Rate 

Base information provided on line 5 of Page 700 by adding (1) Rate Base – Original 

Cost (proposed line 5a), (2) Rate Base – Unamortized Starting Rate Base Write-Up 

(proposed line 5b), (3) Rate Base – Accumulated Net Deferred Earnings (proposed 

line 5c). The sum of proposed lines 5a, 5b and 5c comprise the pipeline’s Trended 

Original Cost Rate Base, which is currently reported on line 5 of Page 700 and which the 

Commission proposes to move to line 5d entitled Total Rate Base – Trended Original 

Cost – (5a + 5b + 5c). 

B. Rate of Return 

9. The Commission proposes to require oil pipelines to report the cost of equity and 

cost of debt components that constitute the overall Weighted Cost of Capital currently 

reported as “Rate of Return” on line 6, Page 700. Specifically, the Commission proposes 

to include additional information related to debt and equity capital structure ratios, i.e. 

(1) Rate of Return – Adjusted Capital Structure Ratio for Long Term Debt (proposed line 

6a), (2) Rate of Return – Adjusted Capital Structure Ratio for Proprietary Capital 

(proposed line 6b).13 The Commission further proposes to add information related to the 

 13 The Adjusted Capital Structure Ratio adjusts upward the level of equity in 

capital structure to account for the treatment of Accumulated Deferred Earnings under the 

Opinion 154-B Methodology. Under the 154-B Methodology, a pipeline’s return on the 

Original Cost and the SRB Write-Up is based on a weighted average of the cost of debt 

and the return on equity. However, a pipeline’s rate of return on Accumulated Net 

Deferred Earnings is the equivalent to the rate of return on equity (proposed line 6d) and 

does not include a cost of debt component. The upward adjustment to equity ratio allows 

(continued...) 
Docket No. RM12-18-000 - 6 - 

cost of debt and the cost of equity, specifically: (1) Rate of Return – Cost of Long Term 

Debt Capital (proposed line 6c), (2) Rate of Return – Real Cost of Proprietary Capital14

(proposed line 6d). This additional information forms the basis for the Rate of Return – 

Weighted Average Cost of Capital (the total of 6a * 6c + 6b * 6d), which is now reported 

as “Rate of Return” on line 6 on Page 700 and which the Commission proposes to move 

to line 6e. 

C. Return on Rate Base

10. The Commission proposes to require oil pipelines to report additional information 

related to the Return on Rate Base in line 7. The Return on Rate Base currently reported 

on line 7 combines the pipeline’s return on equity and the portion of the pipeline’s return 

allocated to paying its cost of debt. The Commission proposes to require the pipeline to 

include on Page 700 the Return on Rate Base – Debt Component (proposed line 7a)15 and 

 

the pipeline to apply its weighted average cost of capital consisting of debt and equity to 

one rate base. ARCO Pipe Line Co., 53 FERC ¶ 61,398 at 62,388-89. 

 

14 The real cost of capital excludes the inflationary component of the nominal 

return that is placed in Net Deferred Earnings pursuant to the trended original cost 

methodology. 

15 Return on Rate Base – Debt Component will be the equivalent of the weighted 

average cost of debt (product of proposed lines 6a and 6c) multiplied by the Trended 

Original Cost Rate Base (proposed line 5d). 
Docket No. RM12-18-000 - 7 - 

the Return on Rate Base – Equity Component (proposed line 7b).16 The Commission 

proposes to report on proposed on line 7c the Total Return on Rate Base – (7a+7b), 

which is the same information currently reported on line 7. 

 D. Composite Tax Rate 

11. The Commission proposes to modify the Page 700 to include the Composite Tax 

Rate used to determine the “Income Tax Allowance.”17 Line 8 of the Page 700 currently 

requires each pipeline to report the total dollar amount attributable to the “Income Tax 

Allowance” in its cost-of-service. The Commission proposes to add a new line 8a which 

will require a pipeline to report its “Composite Tax Rate Percentage.” 

12. The Commission defines the Composite Tax Rate Percentage as the sum, adjusted 

consistent with Commission policy, of (a) the applicable state income tax rate and (b) a 

federal income tax rate. As filed on Page 700, the Composite Tax Rate Percentage 

should reflect the income tax rate used pursuant to Commission’s policies to determine 

the Income Tax Allowance reported on line 8.18 

 16 Return on Rate Base – Equity Component will be the equivalent of the weighted 

average cost of equity (product of proposed lines 6b and 6d) multiplied by the Trended 

Original Cost Rate Base (proposed line 5d). 

17 The Commission’s income tax policy permits “an income tax allowance for all 

entities or individuals owning public utility assets, provided that entity or individual has 

an actual or potential income tax liability to be paid on that income from those assets.” 

Inquiry Regarding Income Tax Allowances, 111 FERC ¶ 61,139 (2005). 

18 For instance, the business structure for a large number of oil pipelines is a 

Master Limited Partnership (MLP). The income tax allowance for an MLP pipeline is 

based upon the tax liability of the owners. 
Docket No. RM12-18-000 - 8 - 

13. The Composite Tax Rate Percentage will create a better understanding of the 

differential between a pipeline’s Total Interstate Operating Revenues (line 10) and the 

pipeline’s Total Cost of Service (line 9). Specifically, the Composite Tax Rate 

Percentage may be used to determine the portion of this differential that is attributable to 

income taxes under Commission policy, and the portion that may be treated as part of a 

pipeline’s actual return on equity. 

E. Calculation of Actual Rate of Return on Equity 

14. These modifications to Page 700 will provide information that may be used to 

calculate a pipeline's actual rate of return on equity. The actual rate of return on equity is 

determined by dividing (a) the actual return on equity by (b) the equity portion of 

Trended Original Cost Rate Base reported on line 5d. The actual return on equity is the 

sum of three components that can be derived using the proposed modifications to 

Page 700: (a) the return on equity embedded in a pipeline’s Page 700 Total Cost of 

Service (proposed line 7b); (b) the difference, adjusted for taxes, between a pipeline’s 

Total Interstate Operating Revenues (proposed Line 10) and a pipeline’s Total Cost of 

Service (proposed Line 9);19 and (c) the current year’s contribution to Net Deferred 

Earnings, which is calculated by multiplying the equity portion of the Trended Original 

 19 The difference between the pipeline’s Total Interstate Operating Revenues 

(Line 10) and Total Cost of Service (proposed Line 9) provides the pipeline’s earnings 

above its Total Cost of Service. As described above, the Composite Tax Rate Percentage 

may be used to determine the portion of this differential that is attributable to income 

taxes under Commission policy and the portion that may be treated as part of a pipeline’s 

actual return on equity. 
Docket No. RM12-18-000 - 9 - 

Cost Rate Base (line 5d) by the current year’s Department of Labor’s consumer price 

index for all urban areas (CPI-U).20 

15. Once the actual return on equity has been derived, it may be divided by the equity 

portion of Trended Original Cost Rate Base. The equity portion of the Trended Original 

Cost Rate base consists of the Trended Original Cost Rate Base (proposed line 5d) 

multiplied by the equity component of capital structure (proposed line 6b). 

16. These proposed modifications to Page 700 will increase the usefulness of 

Page 700. Prior to this proposal, any attempt to estimate an oil pipeline’s actual return on 

equity required assumptions regarding several cost of service components, including 

capital structure (proposed lines 6a and 6b), the composite income tax rate (proposed 

line 8a), and the return on equity embedded in a pipeline’s Page 700 cost of service 

(proposed line 7b). The Commission believes this additional information will make 

Page 700 a more useful tool for evaluating a pipeline’s rates; however, it welcomes 

comments as to whether the proposed changes herein are sufficient for the goals we have 

described above. 

F. Conclusion 

17. As discussed herein, the proposed modifications will facilitate the calculation of 

the actual rate of return on equity based upon Page 700 data. The actual rate of return on 

equity is particularly useful information when using Page 700 to evaluate a pipeline’s 

 20 As noted in footnote 16, the trended original cost methodology divides the 

nominal return on equity component of the cost of service into real return and an 

inflationary return. 
Docket No. RM12-18-000 - 10 - 

rates. The additional information proposed to be reported will impose almost no 

additional burden on oil pipelines because pipelines already must develop cost of service 

supporting calculations to determine the Income Tax Allowance, Rate Base, Rate of 

Return, and Return on Rate Base reported on Page 700. Given these existing 

requirements, the Commission does not anticipate that these proposed additions to 

Page 700 of Form 6 will impose a significant burden on oil pipelines. 

 G. Effective Date 

18. The Commission proposes that the changes to Form 6 are to be effective for 

reporting in the 2013 Form 6. The 2013 Form 6 must be filed on or before April 18, 

2014.21 The new schedule appearing on Page 700 therefore would not be required for 

Form 6 filings until April 18, 2014, for the reporting year ending December 31, 2013. 

III. Information Collection Statement 

19. The Office of Management and Budget (OMB) regulations require approval of 

certain information collection requirements imposed by agency rules.22 Upon approval of 

a collection(s) of information, OMB will assign an OMB control number and an 

expiration date. Respondents subject to the filing requirements of an agency rule will not 

be penalized for failing to respond to these collections of information unless the 

collections of information display a valid OMB control number. The Paperwork 

 21 18 CFR 357.1. 

22 5 CFR 1320. 
Docket No. RM12-18-000 - 11 - 

Reduction Act (PRA)23 requires each federal agency to seek and obtain OMB approval 

before undertaking a collection of information directed to ten or more persons or 

contained in a rule of general applicability.24 

20. The Commission is submitting these reporting requirements to OMB for its review 

and approval under section 3507(d) of the PRA. Comments are solicited on the 

Commission’s need for this information, whether the information will have practical 

utility, the accuracy of provided burden estimates, ways to enhance the quality, utility, 

and clarity of the information to be collected, and any suggested methods for minimizing 

the respondent’s burden, including the use of automated information techniques.

21. The Commission’s estimate of the additional Public Reporting Burden and cost 

related to the proposed rule in Docket RM12-18-000 follow. 

22. For the recurring effort involved in filing the data on proposed lines 5a-5c, 6a-6e, 

7a-7c, and 8a of Page 700 for 2013 and future years, we estimate that the change in 

burden is 0.5 hours per year per respondent. 

 23 44 USC 3501-3520. 

24 OMB’s regulations at 5 CFR 1320.3(c)(4)(i) require that “Any recordkeeping, 

reporting, or disclosure requirement contained in a rule of general applicability is deemed 

to involve ten or more persons.” 
Docket No. RM12-18-000 - 12 - 

RM12-18-000, 

FERC Form 6 

Annual 

No. of 

Filers 

Estimated 

Additional 

Burden 

per Filer 

(Hr.) 

Total 

Estimated 

Additional 

Burden 

(Hr.) 

Estimated 

Additional 

Cost per 

Filer ($)25

Total 

Estimated 

Additional 

Cost ($) 

 Filing new 

proposed lines 

on page 700 166 0.5 88 $34.51 $3,036.88 

23. Information Collection Cost and Burden: The Commission seeks comments on 

the costs and burden to comply with these requirements. 

Title: FERC Form 6, Annual Report of Oil Pipeline Companies 

Action: Proposed Revisions to the FERC Form 6 

OMB Control No: 1902-0022 

Respondents: Oil pipelines 

Frequency of Responses: Annual. 

Necessity of the Information: This action ensures the availability of data 

consistent with the Commission’s obligation to regulate interstate oil and 

petroleum product pipeline rates and the intent of Page 700, to enable the 

Commission and shippers to monitor and analyze interstate pipeline costs. 

Internal review: The Commission has reviewed the proposed changes and 

has determined that the changes are necessary. These requirements 

 25 Based on an estimated average cost per employee for 2012 (including salary 

plus benefits) of $143,540, the estimated average hourly cost per employee is $69.01. 

The average work year is 2,080 hours. 
Docket No. RM12-18-000 - 13 - 

conform to the Commission’s need for efficient and sufficient information 

collection, communication, and management with regard to the oil pipeline 

sector of the energy industry. The Commission has, by means of internal 

review, assured itself that there is specific, objective support for the burden 

estimates associated with the information collection requirements. 

24. Interested persons may obtain information on the reporting requirements by 

contacting: 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]. Comments on 

the requirements of this rule may also be sent to the Office of Information and Regulatory 

Affairs, Office of Management and Budget, Washington, DC 20503 [Attention: Desk 

Officer for the Federal Energy Regulatory Commission]. For security reasons, comments 

should be sent by e-mail to OMB at oira_submission@omb.eop.gov. Please reference 

OMB Control No. 1902-0022, FERC-6 and the docket number of this proposed 

rulemaking in your submission. 

IV. Environmental Analysis 

25. 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.26 The actions taken here fall within categorical exclusions in 

 26 Order No. 486, Regulations Implementing the National Environmental Policy 

Act, 52 FR 47897 (Dec. 17, 1987), FERC Stats. & Regs. ¶ 30,783 (1987). 
Docket No. RM12-18-000 - 14 - 

the Commission’s regulations for information gathering, analysis, and dissemination.27 

Therefore, an environmental assessment is unnecessary and has not been prepared in this 

rulemaking. 

V. Regulatory Flexibility Act 

26. The Regulatory Flexibility Act of 1980 (RFA) generally requires agencies to 

prepare certain statements, descriptions, and analyses of proposed rules that will have a 

significant economic impact on a substantial number of small business entities.28 

Agencies are not required to make such an analysis if a rule would not have such an 

effect. 

27. The Commission does not believe that this proposed rule will have an adverse 

impact on small entities, nor will it impose upon them any significant costs of 

compliance. The Commission identified 29 small entities as respondents to the 

requirements in the proposed rule.29 As explained above, the Commission estimates that 

the change to Page 700 will increase the paperwork burden of preparing Page 700 by 

approximately $34.51 per respondent. The Commission does not estimate that there are 

 27 18 CFR 380.4(a)(5). 

28 5 U.S.C. 601-12. 

29 The RFA definition of “small entity” refers to the definition provided in the 

Small Business Act, which defines a “small business concern” as a business that is 

independently owned and operated and that is not dominant in its field of operation. 

15 U.S.C. 632. The Small Business Size Standards component of the North American 

Industry Classification System defines a small oil pipeline company as one with less than 

1,500 employees. See 13 CFR 121, 201. 
Docket No. RM12-18-000 - 15 - 

any other regulatory burdens associated with this proposed rule. Therefore the 

Commission certifies that the proposed rule will not have a significant impact on a 

substantial number of small entities. Accordingly, no regulatory flexibility analysis is 

required. 

VI. Comment Procedures 

28. The Commission invites interested persons to submit comments on the matters and 

issues proposed in this notice to be adopted, including any related matters or alternative 

proposals that commenters may wish to discuss. Comments are due 60 days from 

publication in the Federal Register. Comments must refer to Docket No. RM12-18-000, 

and must include the commenter's name, the organization they represent, if applicable, 

and their address in their comments. 

29. The Commission encourages comments to be filed electronically via the eFiling 

link on the Commission's web site at http://www.ferc.gov. The Commission accepts 

most standard word processing formats. Documents created electronically using word 

processing software should be filed in native applications or print-to-PDF format and not 

in a scanned format. Commenters filing electronically do not need to make a paper 

filing. 

30. Commenters that are not able to file comments electronically must send an 

original of their comments to: Federal Energy Regulatory Commission, Secretary of the 

Commission, 888 First Street NE, Washington, DC 20426. 

31. All comments will be placed in the Commission's public files and may be viewed, 

printed, or downloaded remotely as described in the Document Availability section 
Docket No. RM12-18-000 - 16 - 

below. Commenters on this proposal are not required to serve copies of their comments 

on other commenters. 

VII. Document Availability 

32. In addition to publishing the full text of this document in the Federal Register, the 

Commission provides all interested persons an opportunity to view and/or print the 

contents of this document via the Internet through the Commission's Home Page 

(http://www.ferc.gov) and in the Commission'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. 

33. From the Commission'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. 

34. User assistance is available for eLibrary and the Commission’s website during 

normal business hours from the Commission’s 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. RM12-18-000 - 17 - 

List of subjects in 18 CFR Part 357 

Pipelines 

Reporting and recordkeeping requirements 

Uniform System of Accounts 

By direction of the Commission. 

( S E A L ) 

Kimberly D. Bose, 

Secretary. 
Docket No. RM12-18-000 - 18 - 

Appendix A- Summary of Proposed Changes to FERC Form 6, Page 700 

Line 5a is added to read as follows: 

Rate Base – Original Cost 

Line 5b is added to read as follows: 

Rate Base – Unamortized Starting Rate Base Write-Up 

Line 5c is added to read as follows: 

Rate Base – Accumulated Net Deferred Earnings 

Line 5d is added to read as follows: 

Total Rate Base – Trended Original Cost – (5a + 5b+5c) 

Line 6a is added to read as follows: 

Rate of Return – Adjusted Capital Structure Ratio for Long Term Debt 

Line 6b is added to read as follows: 

Rate of Return – Adjusted Capital Structure Ratio for Proprietary Capital 

Line 6c is added to read as follows: 

Rate of Return – Cost of Long Term Debt Capital 

Line 6d is added to read as follows: 

Rate of Return – Real Cost of Proprietary Capital 

Line 6e is added to read as follows: 

Rate of Return – Weighted Average Cost of Capital – (6a x 6c + 6b x 6d) 

Line 7a is added to read as follows: 

Return on Rate Base – Debt Component 

Line 7b is added to read as follows: 

Return on Rate Base – Equity Component 

Line 7c is added to read as follows: 

Total Return on Rate Base – (7a + 7b) 

Line 8a is added to read as follows: 

Composite Tax Rate % (37.50% - 37.50) 
Docket No. RM12-18-000 - 19 - 

Note: Appendix B will not be published in the Code of Federal Regulations

Appendix B: Revised Page 700 to Form 6 

Name of Respondent This Report Is: 

□ (1) An Original 

□ (2) A Resubmission 

Date of Report 

(Mo, Da, Yr) 

/ / 

Year/Period of Report 

End of ________ 

Annual Cost of Service Based Analysis Schedule

1.) Use footnotes when particulars are required or for any explanations. 

2.) Enter on lines 1-9, columns (b) and (c), the value the respondent's Operating & Maintenance Expenses, 

Depreciation Expense, AFUDC Depreciation, Amortization of Deferred Earnings, Rate Base, Rate of Return, 

Return, Income Tax Allowance, and Total Cost of Service, respectively, for the end of the current and previous 

calendar years. The values shall be computed consistent with the Commission's Opinion No. 154-B et al. 

methodology. Any item(s) not applicable to the filing, the pipeline company shall report nothing in columns (b) and 

(c). 

3.) Enter on line 10, columns (b) and (c), total interstate operating revenue, as reported on page 301, for the current 

and previous calendar years. 

4.) Enter on line 11, columns (b) and (c), the throughput in barrels from the Statistics of Operations schedule, page 

601, line 33b, total of items (1) and (2), from the current and previous year's FERC Form No. 6. 

5.) Enter on line 12, columns (b) and (c), the throughput in barrel-miles from the Statistics of Operations schedule, 

page 600, line 33a, total of items (1) and (2), from the current and previous year's FERC Form No. 6. 

6.) If the company makes major changes to its application of the Opinion No. 154-B et al. methodology, it must 

describe such changes in a footnote, and calculate the amounts in columns (b) and (c) of lines No. 1-12 using the 

changed application. 

7.) A respondent may be requested by the Commission or its staff to provide its workpapers which support the data 

reported on page 700.

Line 

No. 

Item 

(a) 

 Current Year 

Amount 

(in dollars) 

(b) 

Prior Year Amount 

(in dollars) 

(c) 

1 Operating and Maintenance Expenses 25,000,000 24,500,000 

2 Depreciation Expense 6,500,000 6,450,000 

3 AFUDC Depreciation 500,000 510,000 

4 Amortization of Deferred Earnings 800,000 840,000 

5 Rate Base 

5a Rate Base – Original Cost 90,000,000 94,000,000 

5b Rate Base – Unamortized Starting Rate Base Write-Up 

5c Rate Base – Accumulated Net Deferred Earnings 20,000,000 21,000,000 

5d Total Rate Base –Trended Original Cost – (5a + 5b + 5c) 110,000,000 115,000,000 

6 Rate of Return % (10.25% - 10.25) 

6a Rate of Return – Adjusted Capital Structure Ratio for Long 

Term Debt 36.00 36.00 

6b Rate of Return – Adjusted Capital Structure Ratio for 

Proprietary Capital 64.00 64.00 

6c Rate of Return – Cost of Long Term Debt Capital 8.00 8.00 

6d Rate of Return – Real Cost of Proprietary Capital 14.25 14.25 

6e Rate of Return – Weighted Average Cost of Capital – (6a x 

6c + 6b x 6d) 12.00 12.00 

7 Return on Rate Base 

7a Return on Rate Base – Debt Component 3,168,000 3,312,000 

7b Return on Rate Base – Equity Component 10,032,000 10,488,000 

7c Total Return on Rate Base – (7a + 7b) 13,200,000 13,800,000 

8 Income Tax Allowance 9,000,000 9,400,000 

8a Composite Tax Rate % (37.50% - 37.50) 37.50 37.50 

9 Total Cost of Service 55,000,000 55,500,000 

10 Total Interstate Operating Revenues 60,000,000 57,000,000 

11 Throughput in Barrels 80,000,000 79,000,000 

12 Throughput in Barrel-Miles 40,000,000,000 39,000,000,000 

FERC Form No. 6 (REV 12/13) Page 700