123 FERC ¶ 61,157 

UNITED STATES OF AMERICA 

FEDERAL ENERGY REGULATORY COMMISSION 

Before Commissioners: Joseph T. Kelliher, Chairman; 

 Suedeen G. Kelly, Marc Spitzer, 

 Philip D. Moeller, and Jon Wellinghoff. 

Obtaining Guidance on Regulatory Requirements Docket No. PL08-2-000 

INTERPRETATIVE ORDER MODIFYING NO-ACTION LETTER PROCESS 

AND REVIEWING OTHER MECHANISMS FOR OBTAINING GUIDANCE 

(Issued May 15, 2008) 

1. This order is one of several steps the Commission is taking in response to the 

public input received at and following the November 16, 2007 Conference on 

Enforcement Policy (Conference) to assess our enforcement program in light of the 

passage of the Energy Policy Act of 2005 (EPAct 2005).1

 In this Order, we address 

certain procedural and process matters raised in the comments. As requested by certain 

commenters, we expand the scope of the “no-action” letter (NAL) process through which 

entities subject to our authority may seek a determination on whether staff would 

recommend enforcement action against the requestor if particular transactions, practices 

or situations were pursued. We also review existing and new mechanisms available to 

those seeking guidance from staff and the Commission itself. By a separate order, we are 

revising the Enforcement Policy Statement, issued October 20, 2005.2

 

I. Background

2. EPAct 2005 granted the Commission stronger civil penalty authority to prevent 

and prosecute violations of the Federal Power Act3

 (FPA), Natural Gas Act4 (NGA), and 

 1

 Pub. L. No. 109-58, 119 Stat. 594 (2005) (codified in scattered titles of the 

U.S.C.). 

2 Enforcement of Statutes, Orders, Rules, and Regulations, 113 FERC ¶ 61,068 

(2005). 

3

 16 U.S.C. § 791a et. seq. (2000). 

4

 15 U.S.C. § 771 et. seq. (2000). 
Docket No. PL08-2-000 -2- 

Natural Gas Policy Act of 19785

 (NGPA) and the Commission’s rules, regulations and 

orders thereunder. EPAct 2005 increased the Commission’s maximum civil penalty 

authority to $1 million per day per violation.6

 This expanded civil penalty authority is in 

addition to the Commission’s authority to order other remedies such as disgorgement of 

unjust profits and to condition, suspend, or revoke market-based rate authority, certificate 

authority, or blanket certificate authority. The new authority under EPAct 2005, together 

with the Commission’s existing authority, provides the Commission with tools to 

encourage compliance with its statutes, rules, orders, and regulations and allows the 

Commission to fashion the most appropriate and effective remedies and sanctions for 

each violation. 

3. At the Conference, the Commission solicited questions and comments from the 

public and industry participants regarding its enforcement program following the passage 

of EPAct 2005, particularly in light of the expanded civil penalty authority in Part II of 

the FPA, NGPA, and the NGA. Attendees made a number of suggestions regarding the 

Commission’s enforcement program, including the suggestion that the Commission 

increase the opportunities for the public to obtain guidance and clarification on potential 

compliance issues. 

4. Many commenters request that the Commission expand the NAL process beyond 

the narrow scope that exists today. Some also ask that NAL responses be provided more 

quickly, that more detailed analysis be provided in NAL responses, and that hypothetical 

or anonymous requests be considered. Other commenters request that the Commission 

create a help desk, separate from the Office of Enforcement, for market participants to 

contact for informal guidance. Commenters further request that Commission staff hold 

compliance workshops, prepare and publish on the Commission’s website frequently 

asked questions (FAQs), and provide training and other outreach to assist in compliance 

efforts. Commenters ask for specific assurance that some measure of reliance could be 

placed on guidance provided through the help desk, FAQs, or staff-led trainings. 

5. Commenters further request that the Commission clarify certain Commission 

policies so that it is easier for market participants to comply with applicable rules and 

regulations. Commenters ask several specific questions regarding Commission policies, 

such as limitations on asset management transactions in the gas industry and application 

of the Standards of Conduct7

 to particular situations. Other questions are more general, 

 5

 15 U.S.C. § 3301 et. seq. (2000). 

6

 EPAct 2005, §§ 1284(e), 314 (b)(1)(B) and 314 (b)(2), 119 Stat. 594 at 950 and 

691. 

7

 18 C.F.R. Part 358 (2007). 
Docket No. PL08-2-000 -3- 

such as the appropriate use of network service under the pro forma Open Access 

Transmission Tariff (OATT)8

 or permissible trading strategies under the Energy Market 

Manipulation Rules.9

6. Upon consideration of these comments, we have reevaluated the existing 

mechanisms for obtaining guidance from the Commission and its staff. In order to 

provide additional opportunities for entities subject to our authority to obtain guidance 

from staff regarding potential enforcement actions, we will expand the scope of the NAL 

process but leave in place the remaining requirements for NAL requests. We also 

commit to establishing a compliance help desk on the Commission’s website to provide 

an additional mechanism for regulated companies, companies potentially subject to our 

jurisdiction, and affected entities to obtain more informal guidance from our staff. 

Finally, we direct staff to hold periodic workshops to allow the regulated community to 

discuss particular areas of concern regarding compliance with the statutes, rules, 

regulations, and tariffs administered by the Commission. Taken together, these reforms 

will assist the regulated community in understanding and complying with Commission 

policies and better enable staff to advise the Commission regarding areas of our 

jurisdiction in need of clarification. 

II. Expansion of the NAL Process

7. Through the NAL process, persons may obtain written advice as to whether staff 

would recommend that the Commission take no enforcement action with respect to 

specific proposed transactions, practices or situations.10 Currently, the subject matter of 

NAL requests is limited to issues relating to the Standards of Conduct for transmission 

 8 See Preventing Undue Discrimination and Preference in Transmission Service, 

Order No. 890, 72 Fed. Reg. 12,266 (Mar. 15, 2007), FERC Stats. & Regs. ¶ 31,241 

(2007), order on reh'g, Order No. 890-A, 73 Fed. Reg. 2984 (Jan. 16, 2008), FERC Stats. 

& Regs. ¶ 31,261 (2007). 

9 Prohibition of Energy Market Manipulation, Order No. 670, 71 Fed. Reg. 4244 

(Jan. 26, 2006), FERC Stats. & Regs. ¶ 31,202, order denying reh’g, 114 FERC ¶ 61,300 

(2006) (codified at 18 C.F.R. Part 1c ). 

10 See Interpretative Order Regarding No-Action Letter Process, 113 FERC 

¶ 61,174 (2005) (NAL Interpretative Order); Interpretative Order Modifying No-Action 

Letter Process, 117 FERC ¶ 61,069 (2006) (NAL Modification Order). 
Docket No. PL08-2-000 -4- 

providers,11 Affiliate Restrictions for electric sellers,12 Code of Conduct for natural gas 

sellers,13 and the Commission’s Market Behavior Rules14 and Energy Market 

Manipulation Rules.15 In order to provide the public with additional opportunities to 

obtain written advice from Commission staff regarding potential enforcement actions, we 

will now expand the scope of issues for which NAL requests may be submitted to include 

any issue that falls within the Commission’s jurisdiction, except for those issues arising 

under Part I of the FPA, sections 215 and 216 of the FPA, sections 3, 7, and 15 of the 

NGA, and section 311 of the NGPA. 

8. We decline to include issues related to the licensing of hydroelectric projects, 

certification of natural gas pipelines, and operation of LNG terminals in the NAL process 

because independent, successful programs have already been implemented to address 

compliance matters in these areas. For example, the Commission’s Office of Energy 

Projects has developed a thorough and specific compliance program pursuant to which 

 11 See supra note 7. 

12 18 C.F.R. § 35.39 (promulgated in Market-Based Rates for Wholesale Sales of 

Electric Energy, Capacity, and Ancillary Services by Public Utilities, Order No. 697, 

72 Fed Reg. 39,904 (July 20, 2007), FERC Stats. & Regs. ¶ 31,252 (2007) (Order 

No. 697), clarified by, 121 FERC ¶ 61,260 (2007) order on reh’g, Order No. 697-A, 

FERC Stats. & Regs. ¶ 31,268 (2008)). 

13 18 C.F.R. §§ 284.288, 284.403 (2007). 

14 The Market Behavior Rules applicable to electric wholesale transactions were 

promulgated in Investigation of Terms and Conditions of Public Utility Market-Based 

Rate Authorizations, 105 FERC ¶ 61,218 (2003), reh’g denied, 107 FERC ¶ 61,175 

(2004), revised by, 114 FERC ¶ 61,165 (2006), later codified in Conditions for Public 

Utility Market-Based Rate Authorization Holders, Order No. 674, 71 Fed. Reg. 9695 

(Feb. 27, 2006), FERC Stats. & Regs. ¶ 31,208 (2006), and subsequently renumbered in 

Order No. 697. The Market Behavior Rules applicable to natural gas wholesale 

transactions were promulgated in Amendments to Blanket Certificates, Order No. 644, 

68 Fed. Reg. 66323 (Nov. 26,2003), FERC Stats. & Regs. ¶ 31,153 (2003), reh’g denied, 

107 FERC ¶ 61,174 (2004), aff’d, Colo. Office of Consumer Counsel v. FERC, 490 F.3d 

954 (D.C. Cir. 2007), and were revised in Amendments to Codes of Conduct for 

Unbundled Sales Service and for Person’s Holding Blanket Marketing Certificates, Order 

No. 673, 71 Fed. Reg. 9709 (Feb. 27, 2006), FERC Stats. & Regs. ¶ 31,207 (2006). 

15 See supra note 9. 
Docket No. PL08-2-000 -5- 

staff routinely provides guidance to licensees.16 Inspection programs have been 

implemented to ensure routine and consistent interaction with LNG terminal operators 

and pipeline developers, providing oversight to and reporting mechanisms for that area of 

Commission responsibility. Inspections of natural gas pipelines are also conducted 

during and after construction, which include feedback and remedial actions prior to hand 

off to the Department of Transportation for on-going safety oversight during operation. 

Given such compliance programs, expansion of the NAL process to include issues related 

to the licensing of hydroelectric projects, certification of pipelines, and the authorization 

of LNG terminals would be duplicative and, therefore, unnecessary. 

9. We also decline to include issues related to the enforcement of reliability standards 

in the NAL process at this time. The Regional Entities and the North American Electric 

Reliability Corporation (NERC) have initial responsibility for investigating and fixing 

responsibility for a violation of an approved reliability standard.17 When guidance is 

needed, requests for formal interpretations may be submitted to NERC, which must 

submit any interpretations it approves to the Commission for review. These procedures 

have only recently been implemented and expanding the NAL process to include matters 

under section 215 of the FPA could undermine their development. The Commission will 

consider the inclusion of reliability matters in the NAL process in the future as necessary. 

10. In the past, the Commission has allowed NAL requests to be withdrawn, which 

generally occurred when the requesting party developed a belief that staff was inclined to 

issue a negative response to the request. The Commission considered it appropriate to 

allow companies to withdraw their NAL request in order to encourage companies to seek 

guidance regarding their transactions and practices.18 Upon further consideration, we 

believe that both positive and negative responses to NAL requests can offer useful 

guidance to the industry and that allowing the withdrawal of requests may impair the 

usefulness of the NAL process, particularly in light of its newly expanded scope. We 

therefore will no longer permit the withdrawal of non-confidential NAL requests 

 16 A detailed overview of the compliance program is outlined in the Compliance 

Handbook distributed and updated by the Division of Hydropower Administration and 

Compliance. http://www.ferc.gov/industries/hydropower/geninfo/handbooks/compliance_handbook.pdf (last accessed on February 29, 2008). 

17 See North American Electric Reliability Corp., 116 FERC ¶ 61,062, order on 

reh’g and compliance, 117 FERC ¶ 61,126 (2006). 

18 See NAL Modification Order at P 9. 
Docket No. PL08-2-000 -6- 

submitted after the date of this order.19 Companies that do not wish to submit NAL 

requests that cannot later be withdrawn may obtain informal, verbal guidance from staff 

through one of the other guidance mechanisms described below. 

11. We decline to adopt the remaining recommendations suggested by commenters, 

such as mandating a particular response time or allowing hypothetical or anonymous 

requests.20 All of the remaining requirements for an NAL request therefore remain 

unchanged. NAL requests may not be submitted anonymously and must relate to a 

specific, actual transaction, practice or situation in which the applicant is or may be 

involved. The applicant must explain the specific details of the transaction, practice or 

situation, including identifying to the extent possible the persons involved, the purpose of 

the matter, the requestor’s role in the matter, and the regulatory issues posed. NAL 

requests will not be accepted for hypothetical situations, nor may NAL requests relate to 

transactions or activities that are completed and pre-date the particular request. NAL 

requests will be treated as non-public until the date on which the General Counsel and 

Director of the Office of Enforcement, or their designees, issue a response to the request, 

or for an additional specified period of time not to exceed 120 days. 

12. We also emphasize that, due to their non-binding nature, requests for NAL 

responses should not be used as a substitute for a complaint or other litigation between 

counterparties to a contract. Similarly, counterparties should not use the NAL process to 

seek Commission staff’s advice regarding their relative positions with respect to 

compliance with the terms of a jurisdictional agreement. A NAL request is appropriate 

only for a person seeking advice as to whether staff would recommend that the 

Commission take action against it for violation of one of the statutes we administer, a 

Commission rule, regulation or order, or a Commission-approved tariff. 

 19 In unusual cases a requester may seek non-public treatment of its request for a 

no-action letter and a staff response, at least to the extent that the request and response 

describe the proposed matter or matters that are under review, for a specified period of 

time not in excess of 120 days from the date of any response. If our staff agrees with the 

period of non-public treatment the requester seeks, the Commission will not make the 

request and the response public until the expiration of the time period sought by the 

requester. If staff disagrees with the non-public period sought by the requester, it will so 

notify the requester, who may then withdraw the request within 30 days of the date of the 

staff notice. See NAL Interpretative Order at P 15-16. 

20 Although we decline to mandate a particular response time, we expect that in 

most circumstances staff will act on NAL requests within 60 days after the filing of, or 

amendment to, a request. 
Docket No. PL08-2-000 -7- 

13. Finally, we note that the Commission does not currently charge a fee for 

applicants to file an NAL request as it does with other requests for guidance from the 

Commission.21 We do not, here, propose to charge a fee for filing requests for NAL 

responses. We will continue to reevaluate the need to charge applicants for NAL 

requests based on the number of requests received and the complexity of issues involved 

in the requests for NAL responses. 

III. Mechanisms for Obtaining Commission and Staff Guidance

14. The NAL process is only one of the mechanisms available to those seeking to 

obtain guidance regarding compliance with Commission statutes, rules, regulations or 

orders or Commission-approved tariffs. The most formal, and most binding, form of 

guidance is provided through Commission orders, issued in response to pleadings subject 

to public review and comment. The least formal, and least binding, form of guidance is 

provided through the Enforcement Hotline (Hotline) and meetings and discussions with 

individual members of Commission staff. In between these two extremes are NAL 

responses, legal opinions issued by the Office of the General Counsel, and interpretative 

letters issued by the Chief Accountant. While not binding on the Commission, these 

advisory materials provide confirmation of staff positions that reflect various levels of 

staff consensus. 

15. The choice of which option to pursue when seeking guidance will be influenced 

by a variety of considerations, including the subject matter of the request, the relative 

urgency of the request, the amount of reliance the person desires to place on the guidance 

received, and the level of confidentiality needed. As a general matter, more definitive 

guidance is the product of more time consuming and less confidential processes. To 

assist the public in its consideration of which guidance mechanism is best suited to its 

needs, we review below the various options that are available and the relative level of 

reliance that can be placed on each. Those in need of guidance from the Commission can 

weigh the benefits and limitations of each option in order to determine which is most 

appropriate for a particular circumstance. 

16. Many industry and consumer representatives are already familiar with those 

members of staff to be contacted regarding particular areas of our jurisdiction. For those 

less familiar with Commission staff, we are implementing a compliance help desk on our 

website to provide a mechanism to submit questions regarding compliance with the 

statutes, rules, regulations and tariffs we administer. The compliance help desk will 

allow individuals to indicate the area of our jurisdiction to which a question relates so 

that it can be forwarded internally to the appropriate staff member for response. The 

 21 See 18 C.F.R. Part 381 (2007). 
Docket No. PL08-2-000 -8- 

compliance help desk will be easily accessible from the homepage of our website,22

which will provide further details regarding the type of inquiries for which the 

compliance help desk is appropriate. Through this website feature, persons or companies 

that are or may be subject to the Commission’s jurisdiction, or otherwise affected by 

jurisdictional activities, will be able to easily reach the appropriate member of our staff 

when compliance questions arise. 

17. We reiterate, however, that the informal advice given by staff is never binding on 

the Commission. The Commission’s regulations make clear that “[o]pinions expressed 

by the staff do not represent the official views of the Commission, but are designed to aid 

the public and facilitate the accomplishment of the Commission’s functions.”23 The 

official views of the Commission must be stated through its public orders, agreed to by a 

majority of voting Commissioners based on a complete review of the record. 

Nonetheless, the Commission recognizes that good faith and reasonable reliance on staff 

guidance may be a mitigating factor when considering penalties for violations of a 

statute, rule, regulation, order or tariff. Similarly, acting in contravention of informal 

staff guidance may be an aggravating factor when considering what, if any, civil penalty 

is appropriate for a violation. We further address the issue of mitigating and aggravating 

factors for civil penalty assessments in the accompanying Revised Policy Statement on 

Enforcement. 

18. We encourage the public to continue to reach out to staff when in need of advice 

by using one of the various mechanisms discussed below. Members of our staff are 

experts in their particular area of responsibility and are well acquainted with the statutes, 

regulations, rules and orders administered by the Commission. Those in need of 

guidance can therefore often find valuable information from staff. To the extent more 

formal, binding guidance from the Commission is needed, a petition for declaratory order 

should be considered. 

A. Petition for Declaratory Order

19. Any person seeking to terminate a controversy or remove uncertainty regarding a 

matter within the Commission’s jurisdiction may file a request for a declaratory order 

under Rule 207(a)(2) of the Commission’s rules of practice and procedure.24 The 

 22 The Commission will issue a notice in this docket indicating the specific link to 

the compliance help desk when it is operational. 

23 18 C.F.R. § 388.104(a) (2007). 

24 18 C.F.R. §385.207(a)(2) (2007). There is a filing fee associated with a petition 

for declaratory order, although certain entities are exempt from the filing fee. See 

18 C.F.R. § 381.302 (2007). In the context of a particular proceeding, parties also may 

(continued...) 
Docket No. PL08-2-000 -9- 

declaratory order process can be very useful to persons seeking reliable, definitive 

guidance from the Commission. Recent declaratory orders have addressed such issues as 

the extent of the Commission’s jurisdiction over a natural gas gatherer,25 permissible 

actions under section 305(a) of the FPA,26 and triggering events to make an entity a 

“public utility” under the Public Utility Holding Company Act of 2005.27 As with other 

formal Commission actions, a declaratory order represents a binding statement of policy 

that provides direction to the public and our staff regarding the statutes we administer and 

the implementation and enforcement of our orders, rules and regulations. A declaratory 

order is therefore the most reliable form of guidance available from the Commission. 

20. Essential to the declaratory order process, however, is the ability of interested 

persons to comment on the issues raised. Petitions for declaratory order are therefore 

subject to the public comment process, ensuring that interested persons have the 

opportunity to provide input regarding the subject matter of the petition. Because of the 

public and formal nature of the declaratory order process, there is an unavoidable delay 

between the receipt of a petition and issuance of an order. Although there is no statutory 

time frame to respond to a request for a declaratory order, the Commission attempts to 

respond to all such requests in a timely manner. The amount of time needed to consider 

each petition will vary depending on the complexity of issues raised. To the extent that a 

petitioner or party needs action by a certain date, any request for such action should be 

explained in the petition. 

 

submit requests for clarifications of a prior Commission order in the docket. If the 

requested clarification reveals a need to reform rather than merely clarify a particular rule 

or regulation, the Commission may initiate further proceedings to propose such reforms, 

as it did recently in response to a request for clarification of the rules governing the 

release of firm capacity by shippers on interstate natural gas pipelines. See, e.g., Pacific 

Gas & Elec. Co, et al., 118 FERC 61,005 (2007); Promotion of a More Efficient Capacity 

Release Market, Notice of Proposed Rulemaking, 72 Fed. Reg. 65,916 (Nov. 26, 2007), 

FERC Stats. & Regs. ¶ 32,625 (2007) (Capacity Release NOPR). Requests for 

clarification are not subject to a filing fee. 

25 Quicksilver Resources, Inc., 122 FERC ¶ 61,115 (2008). 

26 Entergy Gulf States, Inc. ex rel. Entergy Gulf States Louisiana, L.L.C., 

122 FERC ¶ 61,075 (2008). 

27 Babcock & Brown Holdings, Inc., 121 FERC ¶ 61,304 (2007). 
Docket No. PL08-2-000 -10- 

B. NAL Requests

21. Through the NAL process, persons may obtain written advice as to whether staff 

would recommend that the Commission take no enforcement action with respect to 

specific existing or proposed transactions, practices or situations.28 NAL responses thus 

provide increased certainty regarding staff’s view on whether a particular transaction, 

practice or situation would be subject to agency enforcement action. As a result, the 

NAL process is an effective tool for entities subject to our authority to reduce the risk of 

failing to comply with the statutes we administer, the orders, rules or regulations 

thereunder, or Commission-approved tariffs. 

22. As discussed above, NAL requests are only appropriate for certain subject matters. 

They must relate to a situation in which the requesting party is or may be involved and 

not involve hypothetical circumstances or completed transactions. Past NAL responses 

have addressed, under then-applicable policies, issues such as the ability of certain 

employees to provide non-public transmission information on a non-discriminatory 

basis,29 the use of shared employees by a transmission provider’s generation function and 

transmission function,30 and classification of service-providing affiliates under the 

Standards of Conduct.31 Expansion of the scope of the NAL process will allow the 

public to obtain similar guidance on a broader range of issues. 

23. Although NAL responses are not binding on the Commission, they are signed by 

representatives of the Office of the General Counsel and the Office of Enforcement and 

thus reflect the consensus view of those offices. Where appropriate, members of the 

Office of Energy Market Regulation also are consulted when preparing an NAL response 

and, therefore, their views are often reflected. Until a response is issued, NAL requests 

are treated as non-public. Applicants can request that staff continue to treat both NAL 

 28 See NAL Interpretative Order at P 6. 

29 E.ON U.S. LLC, Docket No. NL08-1-000 (Nov. 29, 2007). 

30 Entergy Corp., Docket No. NL07-4-000 (Feb. 9, 2007); Bonneville Power 

Administration, Docket No. NL07-5-000 (Feb. 9, 2007).

31 Sabine Pipe Line LLC, Docket No. NL07-1-000 (Nov. 17, 2006); Chandeleur 

Pipe Line Company, Docket No. NL07-2-000 (Nov. 17, 2006). 
Docket No. PL08-2-000 -11- 

requests and responses as non-public for an additional period of 120 days after a response 

is issued. Once an NAL response is public, it is posted in the Commission’s eLibrary 

system in a searchable format.32 

C. General Counsel Opinion Letters

24. Another avenue available to the public when seeking guidance from Commission 

staff is to request an opinion letter from the General Counsel.33 General Counsel opinion 

letters can be used to provide guidance regarding the interpretation of any statute or 

implementing regulation under the Commission’s jurisdiction, such as the Commission’s 

jurisdiction over a particular entity, issue or transaction. Past opinion letters have 

addressed such issues as how two separate but related license applications will be 

treated,34 questions of Commission jurisdiction over natural gas pipelines and electric 

energy sales,35 and whether certain sales would be subject to price mitigation and mustoffer obligations.36 

25. Because they involve legal questions, opinion letters can sometimes be issued 

without involvement from other offices within the Commission. However, typically 

other offices are consulted as appropriate depending on the subject matter presented. 

Although the process for obtaining a General Counsel opinion letter is less complicated, 

 32 NAL responses are posted in “NL” dockets and may be searched in the eLibrary 

system by date or requesting party. A link to all NAL responses is available on the 

Commission’s website at http://www.ferc.gov/legal/no-action-letters.asp. 

33 18 C.F.R. § 388.104(c) (2007). There is a filing fee associated with a General 

Counsel opinion letter except for requests relating solely to matters under Part I of the 

Federal Power Act. See 18 C.F.R. § 381.305 (2007). 

34 Xcel Energy Services, Inc., (August 8, 2005) (unpublished General Counsel 

Opinion Letter). 

35 City of Duluth Public Works & Utilities, (June 7, 2002) (unpublished General 

Counsel Opinion Letter); Southern California Edison Co. v. Lynch, et al., (February 12, 

2001) (unpublished General Counsel Opinion Letter). 

36 Ex rel. City of Los Angeles, Docket No. EL00-95-012 (May 25, 2001). 
Docket No. PL08-2-000 -12- 

the views expressed are only those of the General Counsel and are not binding on the 

Commission. Absent confidentiality concerns, opinion letters will be released to the 

public through postings on the Commission’s eLibrary system.37

D. Accounting Interpretations

26. The Commission’s Uniform Systems of Accounts provide that in order to maintain 

uniformity of accounting, regulated entities must submit questions of doubtful 

interpretations to the Commission for consideration and decision. The Commission and 

its Chief Accountant provide guidance to, and respond to inquiries from, regulated 

entities on the implementation of standards issued by the Financial Accounting Standards 

Board and existing or emerging industry-wide or entity specific accounting issues within 

the context of the Uniform Systems of Accounts. Guidance letters are publicly available 

on the Commission’s website.38 Past guidance letters have addressed such issues as 

accounting for uncertainty in income taxes,39 accounting for the funded status of defined 

benefit postretirement plans,40 and the appropriate accounting treatment for earnings on 

use-restricted debt funds used for construction.41

27. The advice provided in guidance letters issued by the Chief Accountant represent 

the views of the Commission’s accounting staff and serve as controlling accounting 

guidance for regulated entities unless or until superseded by rehearing or other 

 37 Although General Counsel opinion letters often are not issued in a specific 

docket, they can be found by selecting “Interpretation and Advisory Opinion” in the 

Document Type field in eLibrary and searching all issuances within the relevant time 

period. 

38 Accounting guidance letters are issued as either Accounting Interpretations 

(AI dockets) or Accounting Releases and are available on the Commission’s website at 

http://www.ferc.gov/legal/acct-matts.asp. Accounting Releases are also published in the 

Federal Energy Guidelines. 

39 Accounting and Financial Reporting for Uncertainty in Income Taxes, Docket 

AI07-2-000 (May 25, 2007) (unpublished letter order). 

40 Commission Accounting and Reporting Guidance to Recognize the Funded 

Status of Defined Benefit Postretirement Plans, Docket AI07-1-000 (Mar. 29, 2007) 

(unpublished letter order). 

41 Massachusetts Water Resources Authority, Docket No. AI95-2-000 (Aug. 11, 

1995) (unpublished letter order); Release AR-13, FERC Stats. & Regs. ¶ 40,013 (May 1, 

1983). 
Docket No. PL08-2-000 -13- 

Commission action. However, neither guidance letters issued by the Chief Accountant 

nor informal advice provided through discussions with the Chief Accountant are binding 

on the Commission and are not controlling precedent for ratemaking purposes. 

E. Enforcement Hotline

28. The Hotline is operated by staff of the Office of Enforcement and provides 

informal guidance to the public on all areas within the Commission’s jurisdiction, 

provided they do not involve matters before the Commission in docketed proceedings.42 

The Hotline is available to attempt to informally resolve disputes that fall within the 

Commission’s jurisdiction. In addition, the Hotline serves as a conduit for the public and 

industry to inform Enforcement staff of potential violations of Commission statutes, 

rules, regulations, and orders. For example, the Hotline has been used to report 

allegations of market manipulation, an abuse of an affiliate relationship, or a violation of 

a tariff. Through its responses to Hotline inquiries, Enforcement staff provides 

information to the general public and guidance to the energy industry regarding the 

application of the Commission’s statutes, rules, regulations, and orders. 

29. In responding to a Hotline call, the Enforcement staff will research the legal issues 

raised by the inquiry and will likely consult with the staff of other Commission offices 

who have expertise in the subject matter of the inquiry. Although Enforcement staff 

consults with other Commission staff prior to responding to an inquiry, the opinions 

provided through the Hotline are informal and are not binding on the Commission or the 

General Counsel.43 If the caller requests Enforcement staff’s assistance to resolve a 

dispute, staff will contact the companies involved in the dispute and attempt to facilitate a 

resolution that avoids litigation. All calls to the Hotline may be made anonymously,44

and all information and documents obtained through a Hotline inquiry, and any response 

provided, are treated as non-public by the Commission and its staff consistent with the 

provisions of section 1b.9 of the Commission’s regulations.45

F. Meetings, Compliance Help Desk Inquiries, and Other Informal 

 Contacts

30. Members of Commission staff routinely answer questions and offer advice 

regarding matters within the Commission’s jurisdiction to aid the public and facilitate the 

 42 18 C.F.R. § 1b.21 (2007). 

43 18 C.F.R. § 1b.21(a) (2007). 

44 18 C.F.R. § 1b.21(d) (2007). 

45 18 C.F.R. § 1b.21(c) (2007) citing 18 C.F.R. § 1b.9 (2007). 
Docket No. PL08-2-000 -14- 

accomplishment of the Commission’s functions.46 The Commission provides on its 

website specific contact information for subject matter experts within many areas of the 

Commission’s jurisdiction. To find the appropriate point of contact, simply navigate to 

the Industry Activities section of our homepage for the relevant industry and select the 

particular area of interest.47 Alternatively, navigate to the compliance help desk portal 

from the ‘Help’ section of our website to submit questions regarding particular areas of 

compliance.

31. If helpful in a particular circumstance, staff also can arrange meetings with 

representatives from various Commission offices to provide feedback or input on issues 

of concern.48 Staff members often have developed significant expertise in their subject 

area and can help identify relevant issues and precedent to address, as well as areas in 

which precedent is less clear. For example, staff regularly participates in pre-filing 

meetings with persons that anticipate initiating a proceeding at the Commission, as well 

as consumer representatives and staff from other regulatory agencies. Such meetings can 

involve any area of the Commission’s jurisdiction, such as rate matters or project licenses 

and representatives from multiple offices at the Commission may be in attendance. Prefiling meetings thus educate staff regarding matters of interest to the public and allow an 

opportunity for staff to express concerns they may have with an anticipated proposal or 

position. While the information and advice provided in pre-filing meetings is not binding 

on the Commission, candid discussions regarding relevant Commission policies often 

result in filings that are more focused and consistent with Commission policy, which 

benefits the public generally. 

32. Staff also regularly participates in meetings regarding pending rulemakings. 

Because the ex parte restrictions applicable to adjudications do not apply to our 

 46 See 18 C.F.R. § 388.104(a) (2007) (“The Commission staff provides informal 

advice and assistance to the general public and to prospective applicants for licenses, 

certificates, and other Commission authorizations . . .”). 

47 For example, the Industry Activities for the electric industry can be found at 

http://www.ferc.gov/industries/electric/indus-act.asp. Links to particular subject matters 

are provided, each with information regarding the Commission’s activities in the area and 

contact information for staff. Similar webpages are available for other industries, 

accessible by navigating to the Industries link on the Commission’s homepage. We also 

note that every notice of proposed rulemaking and final rule issued by the Commission 

lists at least one specific staff member who is available for questions on that particular 

order or rule. 

48 Staff is not permitted to comment, off-the-record, on ongoing, contested 

proceedings. See 18 C.F.R. § 385.2201 (2007). 
Docket No. PL08-2-000 -15- 

rulemaking proceedings, staff is available to meet with interested persons and answer 

questions that they may have regarding the issues pending in such rulemakings. Candid 

discussions with staff can assist the Commission through refinement of the issues and the 

development of improved comments to be submitted in such rulemakings. 

33. The most frequent form of staff advice is provided during individual conversations 

with staff members. Many questions regarding Commission rules and regulations can 

often be answered through a quick phone call with a member of staff. Staff can answer 

informal questions about any issue that falls under the Commission’s enabling statutes 

and regulations, such as what information an applicant is required to file with the 

Commission under a particular regulation, possible solutions to a potential problem prior 

to initiation of a proceeding before the Commission, and informal clarification on a 

Commission rule or order. While it is important to recognize that such guidance is only 

the opinion of one staff person, that opinion is often informed by years of experience 

within the particular subject area and within the Commission itself. Implementation of 

the compliance help desk will help facilitate the public’s access to this body of 

experience. 

34. It must be emphasized, however, that guidance given informally by staff is the 

most informal form of advice available and will not benefit from the deliberative process 

used to produce NAL responses, opinion letters, and accounting interpretations. Because 

of these limitations, however, informal advice often can be given more quickly and can 

be maintained confidentially at the request of the inquiring party. To ensure maximum 

availability and efficient use of staff resources, inquirers represented by legal counsel are 

expected to research issues initially before seeking staff’s guidance. 

IV. Guidance on the Application of Regulations and Orders

35. At the Conference, several commenters expressed concern that the Commission’s 

rules and regulations are often ambiguous and can be difficult to comply with properly. 

To address these concerns, the Commission invited post-Conference comments 

identifying the particular rules and regulations in need of clarification. Many of the 

topics identified in the subsequent comments are already being addressed in on-going 

proceedings and, therefore, we decline to address them here. 

36. For example, some commenters ask specific questions regarding restrictions on 

asset management transactions in the gas industry and the application of the Standards of 

Conduct in the electric industry. These issues are presently pending before the 

Commission in rulemaking proceedings in Docket Nos. RM08-1-00049 and RM07-1-

 49Capacity Release NOPR, supra note 23. 
Docket No. PL08-2-000 -16- 

000,50 respectively, and are best addressed in those proceedings. Other commenters ask 

more general questions regarding the operation of the market-based rate program and the 

requirements of the pro forma OATT. These questions involve matters that have been 

the subject of extended comment in the proceedings leading to issuance of Order Nos. 

697 and 890 last year.51 Those orders address a host of issues related to the market-based 

rate program and the provision of service under the pro forma OATT and continue to be 

subject to rehearing and clarification in future orders. 

37. We are sensitive, however, to requests for greater clarity in our rules. We 

therefore direct staff to hold periodic workshops with the regulated community to discuss 

areas of concern regarding compliance.52 Through these workshops, the regulated 

community can help staff identify areas in which additional clarity is needed and staff can 

provide advice regarding compliance pending further action by the Commission. In the 

absence of a contested, ongoing proceeding,53 industry participants also can continue to 

contact staff directly through one of the mechanisms described above or bring the matter 

to the Commission’s attention through a request for declaratory order. 

38. In order for the Commission or staff to be responsive, however, requests for 

clarification must be precisely stated within the context of the particular Commission 

policies. This applies equally to matters raised in a declaratory order and in a compliance 

workshop. Claims of general ambiguity without reference to a particular transaction or 

 50 Standards of Conduct for Transmission Providers, Notice of Proposed 

Rulemaking, 73 FR 16228 (Mar. 27, 2008), FERC Stats. & Regs ¶ 32,630 (2008), see 

also Standards of Conduct for Transmission Providers, Order No. 690, 72 FR 2427 

(Jan. 19, 2007), FERC Stats. & Regs. ¶ 31,237 (Jan. 9, 2007), order on clarification, 

Order No. 690-A, 72 FR 14235 (Mar. 27, 2007), FERC Stats. & Regs. ¶ 31,243 (2007). 

51 See Order No. 697, supra note 12; Preventing Undue Discrimination and 

Preference in Transmission Service, Order No. 890, 72 Fed. Reg. 12,266 (Mar. 15, 2007), 

FERC Stats. & Regs. ¶ 31,241 (2007), order on reh’g, Order No. 890-A, 73 Fed. Reg. 

2984 (Jan. 16, 2008), FERC Stats & Regs. ¶ 31,261 (2007). 

52 Compliance workshops will be listed on the Calendar of Events on our website. 

Members of the public interested in receiving notices of upcoming workshops may 

subscribe to the Technical Conferences Feed using the RSS feature on our website. See

http://www.ferc.gov/help/rss.asp. 

53 18 C.F.R. § 385.2201 (2007). 
Docket No. PL08-2-000 -17- 

situation are not helpful to the development of clear and unambiguous rules and 

regulations. Commission staff will utilize such industry feedback to develop 

recommendations for the Commission regarding potential future action to clarify our 

regulations.54

By the Commission. 

( S E A L ) 

Kimberly D. Bose, 

Secretary. 

 54 Staff may also use information gathered in these workshops to update FAQs 

posted on the Commission’s website. We interpret commenter requests to develop and 

post FAQs to be a request to expand the existing FAQs already posted on the Industries 

section of our website. Whether it would be appropriate or helpful for staff to post 

additional FAQs regarding a particular issue is best addressed in the workshop regarding 

that compliance matter.