FERC Revises Business Practices Standards for Pipelines and Proposes New Standards for Electric Utilities

            On May 9, 2005, FERC issued complementary orders adopting revised business practices for natural gas pipelines and proposing similar standards for electric utilities.  The orders largely adopt standards proposed by the North American Energy Standards Board (NAESB). 

The Final Rule for gas pipelines adopts several standards developed by the Whole Gas Quadrant (WGQ) of NAESB, including WGQ's recommended practices for creditworthiness and gas quality reporting.  The creditworthiness standards provide procedural rules by which pipelines should deal with their customers with respect to credit issues, and these standards received broad support from shippers and pipelines.  They would provide standardized procedures for obtaining credit information; acknowledging and responding to requests for and receipt of information; notifying shippers regarding creditworthiness issues and contract termination;  reevaluating of determinations that a service requester is not creditworthy; and monitoring releases of capacity only to shippers  found to be creditworthy.  <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /> 

FERC's Final Rule also adopts WGQ's proposed standards for gas quality reporting.  These standards include requirements that a pipeline include on its Informational Posting Web Site a link or reference guide to its gas quality tariff provisions and information on its daily average gas quality for preceding days to the extent quality information is available for locations that are representative of mainline gas flow for the most recent three-month period.  The Final Rule will become effective June 16, 2005, and pipelines are required to file with FERC conforming tariff provisions by July 1, 2005, to be effective September 1, 2005.  

In an attempt to similarly streamline reporting requirements and business practices for electric utilities, FERC also issued a Notice of Proposed Rulemaking (NOPR) proposing business practices standards that seek to incorporate standards developed by NAESB's Whole Electric Quadrant (WEQ).  The NOPR proposes to adopt: (1) Open Access Same-Time Information Systems (OASIS) Business Practices Standards; (2) OASIS Communications Protocols; and (3) an OASIS Data Dictionary.  The NOPR also proposes procedures for  redirecting transmission service, queuing multiple submissions of identical transmission requests, adopting the OASIS requirements of FERC's Large Generator Interconnection Rule (Order No. 2003), and for reviewing and updating OASIS standards.  Finally, the NOPR proposes to incorporate WEQ business practices standards, which complement the Version 0 Reliability Standards developed by the North American Electric Reliability Council (NERC).  To be considered by the agency, public comments on the NOPR must be submitted by July 1, 2005.   [Standards for Business Practices of Interstate Natural Gas Pipelines, 111 FERC ¶ 61,203 (2005) and Standards for Business Practices and Communication Protocols for Public Utilities, 111 FERC ¶ 61,204 (2005)] [NEW MATTER]