154 FERC ¶ 61,207

DEPARTMENT OF ENERGY

FEDERAL ENERGY REGULATORY COMMISSION

18 CFR Part 284

[Docket No. RM96-1-039; Order No. 587-X]

Standards for Business Practices of Interstate Natural Gas Pipelines

(Issued March 17, 2016)

AGENCY: Federal Energy Regulatory Commission.

ACTION: Order No. 587-X; order on rehearing.

SUMMARY: In Order No. 587-W, the Federal Energy Regulatory Commission 

(Commission) amended its regulations to incorporate by reference the latest version 

(Version 3.0) of seven business practice standards applicable to interstate natural gas 

pipelines adopted by the Wholesale Gas Quadrant of the North American Energy 

Standards Board. Among other matters in that order, the Commission revised the 

information filed in interstate natural gas pipelines’ Index of Customers to reflect the use 

of the pipelines’ proprietary point codes, and made conforming changes in other posting 

regulations. In this order, the Commission grants rehearing and corrects its regulation 

regarding the use of point codes in postings of interruptible transportation.

EFFECTIVE DATE: Changes to regulatory text will become effective [insert date 30 

days after publication in the Federal Register].
Docket No. RM96

-1-039 - 2 -

FOR FURTHER INFORMATION CONTACT:

Stanley Wolf (technical issues)

Office of Energy Policy and Innovation

Federal Energy Regulatory Commission

888 First Street, NE

Washington, DC 20426

Telephone: (202) 502-6841

E-mail: stanley.wolf@ferc.gov

Oscar F. Santillana (technical issues)

Office of Energy Market Regulation

Federal Energy Regulatory Commission

888 First Street, NE

Washington, DC 20426

Telephone: (202) 502-6392

E-mail: oscar.santillana@ferc.gov

Gary D. Cohen (legal issues)

Office of the General Counsel

Federal Energy Regulatory Commission

888 First Street, NE

Washington, DC 20426

Telephone: (202) 502-8321

E-mail: gary.cohen@ferc.gov

SUPPLEMENTARY INFORMATION:
154 FERC ¶ 61,207

UNITED STATES OF AMERICA

FEDERAL ENERGY REGULATORY COMMISSION

Before Commissioners: Norman C. Bay, Chairman;

 Cheryl A. LaFleur, Tony Clark,

and Colette D. Honorable.

Standards for Business Practices of 

 Interstate Natural Gas Pipelines

Docket No. RM96-1-039

ORDER GRANTING REHEARING

ORDER NO. 587-X

(Issued March 17, 2016)

1. In this order, in response to requests for rehearing by the Interstate Natural Gas 

Association of America (INGAA) and Southern Star Central Gas Pipeline, Inc. 

(Southern Star), the Commission grants rehearing of Order No. 587-W, the 

Commission’s Final Rule issued in this proceeding on October 16, 2015,

1 and revises

section 284.13(b)(2)(iv) of the Commission’s regulations regarding the posting of receipt 

and delivery points for interruptible transportation.

I. Background

2. In Order No. 587-W, the Commission amended its regulations to incorporate by 

reference the latest version (Version 3.0) of seven business practice standards applicable 

 1 Standards for Business Practices of Interstate Natural Gas Pipelines;

Coordination of the Scheduling Process of Interstate Natural Gas Pipelines and Public 

Utilities, Order No. 587-W, 80 FR 67302 (Nov. 2, 2015), FERC Stats. & Regs. ¶ 31,373 

(2015). 
Docket No. RM96-1-039 - 2 -

to interstate natural gas pipelines adopted by the Wholesale Gas Quadrant (WGQ) of the 

North American Energy Standards Board (NAESB). As relevant here, the Version 3.0 

standards revised the codes used to identify receipt and delivery locations in the Index of 

Customers. Prior to Version 3.0, the postings required the pipelines to use an industry 

common code to refer to individual receipt and delivery points. Version 3.0 revised this 

requirement to require the pipelines to use their own proprietary point codes for receipt 

and delivery points and to post additional information about these points on the pipelines’ 

internet web sites.2 Due to the adoption of proprietary point codes, the Commission 

revised its regulations at 18 CFR 157.14, 157.18, 260.8, and 284.13 to refer to the same 

proprietary location point names as used in the NAESB WGQ Version 3.0 Standards.

3. In comments on the Notice of Proposed Rulemaking (NOPR), Southern Star and 

INGAA pointed out that the Commission in the NOPR had failed to make conforming 

changes to certain regulations, including, as relevant here, the regulations requiring 

posting of interruptible transportation at 18 CFR 284.13(b)(2)(iv). Based on the 

regulatory text proposed by Southern Star, the Commission revised this regulation to 

require pipelines to post: “[t]he receipt and delivery points and the zones or segments 

 2 18 CFR 284.13(f), as added in Order No. 587-W, states: Location codes. An 

interstate pipeline must maintain a posting on its publicly available Internet Web site of 

the pipeline's location names and codes for all current and inactive receipt and delivery 

points on its system, including, for each point: Direction of flow, the location of the 

point, the location zone if such exists, the Commission company identification code 

(CID), if any, of the upstream and/or downstream entity, the location type, the current 

status as active and inactive, and the date(s) the point becomes active or inactive. The 

pipeline must provide the information in downloadable file formats, in conformity with 

the requirements of 18 CFR 284.12 of this chapter.
Docket No. RM96-1-039 - 3 -

covered by the contract, including the location name and code adopted by the pipeline in 

conformance with paragraph (f) of this section for each point, zone or segment.”

(Emphasis added.)

4. After the issuance of Order No. 587-W, both Southern Star and INGAA filed 

separate requests for rehearing, challenging the inclusion of the phrase “covered by the 

contract” in the regulation. They argue that the regulatory text adopted for posting of 

interruptible transportation promulgated in 18 CFR 284.13(b)(2)(iv) did not correctly 

reflect the Commission’s determination in Order No. 637-A that the postings for 

interruptible transportation should not refer to points covered by the contract, but rather

to the points over which the shipper is permitted to transport natural gas.3 INGAA 

contends the Commission rejected that contract-covered language in Order No. 637, 

because that language implied that receipt or delivery points should be those in the pro 

forma or master contracts, rather than the points in the subsequent agreement to provide 

interruptible service.

II. Discussion

5. We grant rehearing, concluding that the language we adopted in Order No. 587-W 

incorrectly includes the “covered by the contract” language that does not reflect how 

 3 Regulation of Short-Term Natural Gas Transportation Services and Regulations 

of Interstate Natural Gas Transportation Services, Order No. 637. FERC Stats. & Regs. ¶ 

31,091, clarified, Order No. 637-A, FERC Stats. & Regs. ¶ 31,099, reh’g denied, Order 

No. 637-B, 92 FERC ¶ 61,062 (2000), aff’d in part and remanded in part sub nom. 

Interstate Natural Gas Ass’n of America v. FERC, 285 F.3d 18 (D.C. Cir. 2002), order on 

remand, 101 FERC ¶ 61,127 (2002), order on reh’g, 106 FERC ¶ 61,088 (2004), aff’d 

sub nom. American Gas Ass’n v. FERC, 428 F.3d 255 (D.C. Cir. 2005).
Docket No. RM96-1-039 - 4 -

pipelines arrange for and schedule interruptible service. In Order No. 637-A, the 

Commission recognized that shippers obtaining interruptible service frequently execute 

pro forma master contracts for interruptible service, but do not specify the price or the 

receipt and delivery points until nominations are made. The Commission, therefore, 

removed the requirement to post the receipt and delivery points “covered by the contract” 

from the posting requirements, so that pipelines will post the actual points used for 

transporting natural gas:

This language [covered by the contract] implies that the 

receipt or delivery points should be those in the master 

contract, rather than the points in the subsequent agreement to 

provide interruptible service. Section 284.13(b)(2)(iv) will be 

revised to require the posting of the receipt and delivery 

points over which the shipper is entitled to transport gas at the 

rate charged to make clear that the pipeline should post the 

receipt and delivery points in each individual agreement to 

provide interruptible service, not simply the receipt and 

delivery points in the master contract.4

6. Accordingly, we will grant rehearing and revise the regulatory text to require 

pipelines to post the receipt and delivery points between which the shipper is entitled to 

transport gas at the rate charged, including the location name and code adopted by the 

pipeline in conformance with paragraph (f) of the section for each point, zone, or 

segment.

7. The Paperwork Reduction Act (PRA) provides that an agency may not conduct or 

sponsor the collection of information unless the agency has published an estimate of the 

 4 Order No. 637-A, FERC Stats. & Regs. ¶ 31,099 at 31,619-20.
Docket No. RM96-1-039 - 5 -

burden that shall result from the information collection in advance of adopting or revising 

such collection. Agency rules that require information collection are subject to review 

and approval by the Office of Management and Budget (OMB), in accordance with the 

requirements of the PRA. The reporting requirements imposed in Order No. 587-W 

(Docket No. RM96-1-038) were submitted to and approved (on December 9, 2015) by 

OMB.5

 The revisions made in this Order merely clarify those reporting requirements and 

are not expected to modify the burden estimates. This Order will be submitted to OMB 

for information only.

List of subjects in 18 CFR Part 284

Incorporation by reference, Natural gas, Reporting and recordkeeping requirements.

By the Commission.

( S E A L )

Nathaniel J. Davis, Sr.,

Deputy Secretary.

 5 FERC–545 (Gas Pipeline Rates: Rate Change (Non-Formal)) is covered under 

OMB Control No. 1902-0154, and FERC–549C (Standards for Business Practices of 

Interstate Natural Gas Pipelines) is covered under 1902-0174.
In consideration of the foregoing, the Commission amends part 284, chapter I, title 

18, Code of Federal Regulations, as follows:

PART 284 -- CERTAIN SALES AND TRANSPORTATION OF NATURAL GAS 

UNDER THE NATURAL GAS POLICY ACT OF 1978 AND RELATED 

AUTHORITIES

1. The authority citation for part 284 continues to read as follows:

2. Authority: 15 U.S.C. 717-717z, 3301-3432; 42 U.S.C. 7101-7352; 43 U.S.C. 

1331-1356.

3. Section 284.13 is amended by revising paragraph (b)(2)(iv) to read as follows:

§ 284.13 Reporting requirements for interstate pipelines.

* * * * *

(b) * * *

(2) * * *

 (iv) The receipt and delivery points between which the shipper is entitled to transport 

gas at the rate charged, including the location name and code adopted by the pipeline in 

conformance with paragraph (f) of this section for each point, zone, or segment;

* * * * *