Federal Register / Vol. 66, No. 103 / Tuesday, May 29, 2001 / Notices 29101

DEPARTMENT OF ENERGY

Federal Energy Regulatory

Commission

[Docket No. CP01–361–000]

Northwest Pipeline Corporation; Notice

of Application

May 22, 2001.

Take notice that on May 11, 2001,

Northwest Pipeline Corporation

(Northwest) 295 Chipeta Way, Salt Lake

City, Utah 84108, filed, in Docket No.

CP01–361–000, an application pursuant

to Section 7(c) of the Natural Gas Act

and Part 157 of the Federal Energy

Regulatory Commission’s (Commission)

regulations for a certificate of public

convenience and necessity authorizing:

(1) two taps on Northwest’s mainline

near Vail, Washington, (2) a 20-inch

diameter 48.9-mile lateral pipeline in

Thurston and Grays Harbor Counties,

Washington, (3) 4700 horsepower of

compression at an existing compressor

station in Thurston County, (4) a

delivery meter station in Grays Harbor

County, all as more fully set forth in the

application which is on file with the

Commission and open to public

inspection. This filing may be viewed at

http://www.ferc.fed.us/online/rims.htm

(call 202–208–2222 for assistance).

Specifically, Northwest requests

authorization to construct the Grays

Harbor Lateral to provide natural gas

deliveries to Duke Energy Grays Harbor,

LLC (Duke) for electricity generation at

a planned new power plant in Grays

Harbor County. Duke has executed a

Rate Schedule TF–1 Transportation

Agreement (Lateral Transportation

Agreement), for the firm transportation

of up to 161,500 Dth per day over the

proposed Grays Harbor Lateral, for a

primary term of 30 years.

Northwest requests approval of nonconforming provisions in its Lateral

Transportation Agreement with Duke

that include: giving Duke a preferential

right to acquire any compression-only

expansive capacity on the lateral for a

period of ten years; an agreement by

Northwest not to solicit expansion

transportation commitments through a

mainline expansion open season

process for expansion capacity on the

proposed delivery facilities and; a

provision to adjust Duke’s cost

responsibility in the event that

Northwest installs additional

compression to provide expansion

capacity for a third-party shipper.

Northwest also requests any necessary

waiver of Northwest’s tariff provisions,

specifically requesting waiver of Section

21.3 of its tariff’s General Terms and

Conditions to the extent necessary for

the Lateral Transportation Agreement

provisions to supersede the otherwise

applicable tariff provision for early

lump sum buyouts of a cost of service

charge.

The estimated cost of the proposed

lateral facilities is approximately $75.2

million with an estimated initial

monthly cost-of-service charge for Duke

of $1,406,692. Pursuant to the Lateral

Transportation Agreement, Duke will

reimburse Northwest for all actual costs

associated with the proposed facilities

by paying a monthly cost-of-service

charge over 30 years. In recognition of

Duke’s facilities reimbursement

obligation, the associated Rate Schedule

TF–1 reservation charge for Duke’s

transportation on the lateral will be

discounted to zero. Northwest requests

a preliminary determination on nonenvironmental issues by November 15,

2001, and a final certificate order no

later than April 15, 2002, in order to

complete the project before November

2002, the date Duke estimates it will

require test gas for its new plant.

Questions regarding the details of this

proposed project should be directed to

Mr. Gary Kotter, Manager Certificates,

Northwest Pipeline Corporation, P.O.

Box 58900, Salt Lake City, Utah 84158–

0900 or call (801) 584–7117.

There are two ways to become

involved in the Commission’s review of

this project. First, any person wishing to

obtain legal status by becoming a party

to the proceedings for this project

should, on or before June 12, 2001, file

with the Federal Energy Regulatory

Commission, 888 First Street, NE.,

Washington, DC 20426, a motion to

intervene in accordance with the

requirements of the Commission’s Rules

of Practice and Procedure (18 CFR

385.214 or 385.211) and the Regulations

under the NGA (18 CFR 157.10). A

person obtaining party status will be

placed on the service list maintained by

the Secretary of the Commission and

will receive copies of all documents

filed by the applicant and by all other

parties. A party must submit 14 copies

of filings made with the Commission

and must mail a copy to the applicant

and to every other party in the

proceeding. Only parties to the

proceeding can ask for court review of

Commission orders in the proceeding.

However, a person does not have to

intervene in order to have comments

considered. The second way to

participate is by filing with the

Secretary of the Commission, as soon as

possible, an original and two copies of

comments in support of or in opposition

to this project. The Commission will

consider these comments in

determining the appropriate action to be

taken, but the filing of a comment alone

will not serve to make the filer a party

to the proceeding. The Commission’s

rules require that persons filing

comments in opposition to the project

provide copies of their protests only to

the party or parties directly involved in

the protest.

Persons who wish to comment only

on the environmental review of this

project should submit an original and

two copies of their comments to the

Secretary of the Commission.

Environmental commenters will be

placed on the Commission’s

environmental mailing list, will receive

copies of the environmental documents,

and will be notified of meetings

associated with the Commission’s

environmental review process.

Environmental commenters will not be

required to serve copies of filed

documents on all other parties.

However, the non-party commenters

will not receive copies of all documents

filed by other parties or issued by the

Commission (except for the mailing of

environmental documents issued by the

Commission) and will not have the right

to seek court review of the

Commission’s final order.

The Commission may issue a

preliminary determination on nonenvironmental issues prior to the

completion of its review of the

environmental aspects of the project.

This preliminary determination

typically considers such issues as the

need for the project and its economic

effect on existing customers of the

applicant, on other pipelines in the area,

and on landowners and communities.

For example, the Commission considers

the extent to which the applicant may

need to exercise eminent domain to

obtain rights-of-way for the proposed

project and balances that against the

non-environmental benefits to be

provided by the project. Therefore, if a

person has comments on community

and landowner impacts from this

proposal, it is important either to file

comments or to intervene as early in the

process as possible.

Comments, protests, and

interventions may be filed electronically

via the internet in lieu of paper. See, 18

CFR 385.2001(a)(1)(iii) and the

instructions on the Commission’s web

site at http://www.ferc.fed.us/efi/

doorbell.htm.

If the Commission decides to set the

application for a formal hearing before

an Administrative Law Judge, the

Commission will issue another notice

describing that process. At the end of

the Commission’s review process, a

29102 Federal Register / Vol. 66, No. 103 / Tuesday, May 29, 2001 / Notices

1Section 284.8(i) of the Commission’s

regulations, as implemented by Order No. 637,

states that, ‘‘[u]ntil September 30, 2002, the

maximum rate ceiling does not apply to capacity

release transactions of less than one year. With

respect to releases of 31 days or less under

paragraph (h), the requirements of paragraph (h)(2)

will apply to all such releases regardless of the rate

charged.’’

2On May 18, 2001, in Docket No. RM01–9–000,

the Commission issued an order proposing to

impose certain reporting requirements on natural

gas sellers and transporters serving the California

market. The proposed reporting requirements are

intended to provide the Commission with the

necessary information to determine what action, if

any, it should take within its jurisdiction. Our order

today coupled with our May 18 order continues to

focus on issues related to natural gas prices in

California and actions we may take to address

capacity release transactions and bundled sales (i.e.,

the ‘‘gray market’’).

3Energy Information Administration 1999 Report

on California Interstate Natural Gas Pipeline

Capacity Levels. The Commission has also recently

approved an additional 485,000 Mcf/day of capacity

into California. See, Questar Southern Trails

Pipeline Company, Docket No. CP99–163–001, et

al., 92 FERC ¶ 61,110 (2000); Kern River Gas

Transmission Company, Docket No. CP01–106–000,

95 FERC ¶ 61,022 (2001); and E1 Paso Natural Gas

Company, Docket No. CP00–422–000, et al., 95

FERC ¶ 61, 176 (2001). 4See, www.cpuc.ca.gov/static/industry/gas/

gas+workshop.htm. April 17, 2001 presentation of

the California Energy Commission at CPUC Natural

Gas Infrastructure Workshop. An analysis done by

Economists Incorporated for the Interstate Natural

Gas Association of America shows that the

interstate takeaway capacity is 5,853,000 Mcf per

day. See, ‘‘Calif. Utilities Spurned Pipeline

Projects’’ in The Electricity Daily (May 18, 2001).

final Commission order approving or

denying a certificate will be issued.

David P. Boergers,

Secretary.

[FR Doc. 01–13359 Filed 5–25–01; 8:45 am]

BILLING CODE 6717–01–M

DEPARTMENT OF ENERGY

Federal Energy Regulatory

Commission

[Docket No. RP01–180–000; Docket No.

RP01–222–000]

Before Commissioners: Curt He ́bert,

Jr., Chairman; William L. Massey, and

Linda Breathitt San Diego Gas and

Electric Company and The Los

Angeles Department of Water and

Power; Order Requesting Comments

Issued May 22, 2001.

In response to petitions for relief

concerning high natural gas prices in

California, this order requests comments

on whether the Commission should

reimpose the maximum rate ceiling on

short-term capacity release transactions

into California, and the effects of such

action on the California gas market.

Background

1. On December 7, 2000, in Docket

No. RP01–180–000, San Diego Gas and

Electric Company (SDG&E) filed a

petition for emergency relief requesting

that the Commission immediately order

(1) that price-caps for short-term

releases of capacity for service to the

California border and to points of

interconnection between interstate

pipelines and California local

distribution companies (LDCs) be reimposed effective immediately and kept

in effect until March 31, 2001,1 and (2)

that sellers be required to state

separately the transportation and

commodity components of the bundled

rate for sales at these points so that the

cap can be enforced on these

transactions.2 Alternatively, SDG&E

asserted that the cap could be enforced

on such bundled sales through a

mechanism that caps bundled sales at

these points at 150 percent of the sum

of a reported average commodity sales

price plus the as billed rate for interstate

transportation.

2. On February 1, 2001, the Los

Angeles Department of Water and Power

(LADWP) filed a petition that requests

that the Commission immediately

rescind the portion of Order No. 637

that removed the price cap for shortterm capacity release and pipeline

capacity transactions for service to the

California border and to points of

interconnection between interstate

pipelines and California LCDs until

March 31, 2001. LADWP further

requests that the Commission initiate a

proceeding that will allow the

Commission to determine by March 31,

2001, whether the removal of the price

cap on short-term transactions

associated with California is warranted.

Public Notice and Interventions

Public notice of SDG&E’s filing was

issued on December 8, 2000.

Interventions and protests were due by

December 13, 2000. Public notice of

LADWP’s filing was issued on February

26, 2001. Interventions and protests

were due by March 2, 2001. Pursuant to

Rule 214 (18 CFR 385.214 (2000)), all

timely filed motions to intervene and

any motions to intervene out-of-time

filed before the issuance date of this

order are granted. Granting late

intervention at this stage of the

proceeding will not disrupt the

proceeding or place additional burdens

on existing parties.

With respect to SDG&E’s petition, a

number of California entities, including

the Public Utilities Commission of the

State of California (CPUC), California

local distribution companies (LDCs),

municipalities, and various business

concerns, filed comments in support of

granting the requested relief. Comments

in opposition to SDG&E’s petition were

filed by various parties, mainly by gas

marketers. Certain other commenters

such as the Indicated Shippers and the

Natural Gas Supply Association (NGSA)

supported reimposition of the price cap

on short-term capacity release

transactions but opposed any price cap

on bundled sales of gas or the gas

commodity. Since LADWP’s request for

relief is the same as SDG&E’s fewer

comments were filed in response to

LADWP’s petition. As with the SDG&E

petition, California entities support the

request for relief.

Discussion

SDG&E and LADWP request that the

Commission re-impose the price cap for

short-term releases of capacity for

service to the California border and to

points of interconnection between

interstate pipelines and California LCDs.

Their request for relief is based on the

assumption that high prices of gas

delivered at the California border are

due, in part, to the ability of persons

selling to the California market to charge

above the interstate pipeline’s

maximum tariff rate for the release of

pipeline capacity. SDG&E points to the

spot price at the California border of $50

per MMBtu for November and December

2000 as evidence of significant market

distortions requiring Commission

action.

In response to the requests filed by

SDG&E and LADWP, the Commission

Staff has been analyzing the capacity

release information pipelines are

required to maintain pursuant to section

284.13 of the Commissions’s

regulations. The Commission Staff has

examined capacity release information

for pipelines serving California for the

period from November 2000 through

April 2001. The Commission Staff’s

analysis in the attached Appendix

shows that there were very few capacity

transactions release transactions into

California that were above the pipelines’

maximum rates. For the period

November 2000 through April 2001, the

pipelines’ capacity release information

shows that releases above the pipelines’

maximum rates ranged from a high of

91,236 MMBtu/day for April 2001 to a

low of 7,000 MMBtu/day in December

2000. The interstate capacity into

California is approximately 7,435,000

Mcf/day 3 (an Mcf is roughly equal to an

MMBtu) and the intrastate receipt

capacity (takeaway capacity) is

approximately 6,675,000 Mcf/day.4

Therefore, the volume of capacity