18 Cfr 284.501-505

§ 284.403

18 CFR Ch. I (4–1–11 Edition)

(c)(1) The authorization granted in
paragraph (a) of this section will become effective for an affiliated marketer with respect to transactions involving affiliated pipelines when an affiliated pipeline receives its blanket
certificate pursuant to § 284.284.
(2) Should a marketer be affiliated
with more than one pipeline, the authorization granted in paragraph (a) of
this section will not be effective for
transactions involving other affiliated
interstate pipelines until such other
pipelines’ meet the criterion set forth
in paragraph (c)(1) of this section. The
authorization granted in paragraph (a)
of this section is not extended to affiliates of persons who transport gas in
interstate commerce and who do not
have a tariff on file with the Commission under part 284 of this subchapter
with respect to transactions involving
that person.
(d) Abandonment of the sales service
authorized in paragraph (a) of this section is authorized pursuant to section
7(b) of the Natural Gas Act upon the
expiration of the contractual term or
upon termination of each individual
sales arrangement.
[Order 547, 57 FR 57959, Dec. 8, 1992, as
amended by Order 581, 60 FR 53074, Oct. 11,
1995; Order 644, 68 FR 66337, Nov. 26, 2003]

WReier-Aviles on DSKGBLS3C1PROD with CFR

§ 284.403 Code of conduct for persons
holding blanket marketing certificates.
(a) To the extent Seller engages in
reporting of transactions to publishers
of electricity or natural gas indices,
Seller must provide accurate and factual information, and not knowingly
submit false or misleading information
or omit material information to any
such publisher, by reporting its transactions in a manner consistent with
the procedures set forth in the Policy
Statement on Natural Gas and Electric
Price Indices, issued by the Commission
in Docket No. PL03–3–000 and any clarifications thereto. Seller must notify
the Commission as part of its FERC
Form No. 552 annual reporting requirement in § 260.401 of this chapter whether it reports its transactions to publishers of electricity and natural gas
indices. In addition, Seller shall adhere
to any other standards and require-

ments for price reporting as the Commission may order.
(b) A blanket marketing certificate
holder shall retain, for a period of five
years, all data and information upon
which it billed the prices it charged for
the natural gas sold pursuant to its
market based sales certificate or the
prices it reported for use in price indices.
[Order 644, 68 FR 66337, Nov. 26, 2003, as
amended by Order 673, 71 FR 9716, Feb. 27,
2006; Order 677, 71 FR 30287, May 26, 2006; 73
FR 1032, Jan. 4, 2008; 73 FR 55739, Sept. 26,
2008]

Subpart M—Applications for
Market-Based Rates for Storage
SOURCE: Order 678, 71 FR 36636, July 27,
2006, unless otherwise noted.

§ 284.501

Applicability.

Any pipeline or storage service provider that provides or will provide service under subparts B, C, or G of this
part, and that wishes to provide storage and storage-related services at
market-based rates must conform to
the requirements in subpart M.
§ 284.502 Procedures for applying for
market-based rates.
(a) Applications for market-based
rates may be filed with certificate applications. Service, notice, intervention, and protest procedures for such
filings will conform with those applicable to the certificate application.
(b) With respect to applications not
filed as part of certificate applications,
(1) Applicants providing service
under subpart B or subpart G of this
part must file a request for declaratory
order and comply with the service and
filing requirements of part 154 of this
chapter. Interventions and protests to
applications for market-based rates
must be filed within 30 days of the application unless the notice issued by
the Commission provides otherwise. An
applicant providing service under subpart B or subpart G of this part cannot
charge market-based rates under this
subpart of this part until its application has been accepted by the Commission. Once accepted, the applicant can
make the appropriate filing necessary

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Federal Energy Regulatory Commission

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to set its market-based rates into effect.
(2) Applicants providing service
under subpart C of this part must file
in accordance with the requirements of
that subpart.
§ 284.503 Market-power determination.
An applicant may apply for marketbased rates by filing a request for a
market-power determination that complies with the following:
(a) The applicant must set forth its
specific request and adequately demonstrate that it lacks market power in
the market to be served, and must include an executive summary of its
statement of position and a statement
of material facts in addition to its
complete statement of position. The
statement of material facts must include citation to the supporting statements, exhibits, affidavits, and prepared testimony.
(b) The applicant must include with
its application the following information:
(1) Statement A—geographic market.
This statement must describe the geographic markets for storage services in
which the applicant seeks to establish
that it lacks significant market power.
It must include the market related to
the service for which it proposes to
charge market-based rates. The statement must explain why the applicant’s
method for selecting the geographic
markets is appropriate.
(2) Statement B—product market. This
statement must identify the product
market or markets for which the applicant seeks to establish that it lacks
significant market power. The statement must explain why the particular
product definition is appropriate.
(3) Statement C—the applicant’s facilities and services. This statement must
describe the applicant’s own facilities
and services, and those of all parent,
subsidiary, or affiliated companies, in
the relevant markets identified in
Statements A and B in paragraphs
(b)(1) and (2) of this section. The statement must include all pertinent data
about the storage facilities and services.
(4) Statement D—competitive alternatives. This statement must describe
available alternatives in competition

§ 284.503
with the applicant in the relevant markets and other competition constraining the applicant’s rates in those
markets. Such proposed alternatives
may include an appropriate combination of other storage, local gas supply,
LNG, financial instruments and pipeline capacity. These alternatives must
be shown to be reasonably available as
a substitute in the area to be served
soon enough, at a price low enough,
and with a quality high enough to be a
reasonable alternative to the applicant’s services. Capacity (transportation, storage, LNG, or production)
owned or controlled by the applicant
and affiliates of the applicant in the
relevant market shall be clearly and
fully identified and may not be considered as alternatives competing with
the applicant. Rather, the capacity of
an applicant’s affiliates is to be included in the market share calculated
for the applicant. To the extent available, the statement must include all
pertinent data about storage or other
alternatives and other constraining
competition.
(5) Statement E—potential competition.
This statement must describe potential
competition in the relevant markets.
To the extent available, the statement
must include data about the potential
competitors, including their costs, and
their distance in miles from the applicant’s facilities and major consuming
markets. This statement must also describe any relevant barriers to entry
and the applicant’s assessment of
whether ease of entry is an effective
counter to attempts to exercise market
power in the relevant markets.
(6) Statement F—maps. This statement
must consist of maps showing the applicant’s principal facilities, pipelines
to which the applicant intends to interconnect and other pipelines within the
area to be served, the direction of flow
of each line, the location of the alternatives to the applicant’s service offerings, including their distance in miles
from the applicant’s facility. The
statement must include a general system map and maps by geographic markets. The information required by this
statement may be on separate pages.
(7) Statement G—market-power measures. This statement must set forth the

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§ 284.504

18 CFR Ch. I (4–1–11 Edition)

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calculation of the market concentration of the relevant markets using the
Herfindahl-Hirschman
Index.
The
statement must also set forth the applicant’s market share, inclusive of affiliated service offerings, in the markets to be served. The statement must
also set forth the calculation of other
market-power measures relied on by
the applicant. The statement must include complete particulars about the
applicant’s calculations.
(8) Statement H—other factors. This
statement must describe any other factors that bear on the issue of whether
the applicant lacks significant market
power in the relevant markets. The description must explain why those other
factors are pertinent.
(9) Statement I—prepared testimony.
This statement must include the proposed testimony in support of the application and will serve as the applicant’s case-in-chief, if the Commission
sets the application for hearing. The
proposed witness must subscribe to the
testimony and swear that all statements of fact contained in the proposed
testimony are true and correct to the
best of his or her knowledge, information, and belief.
§ 284.504 Standard requirements for
market-power authorizations.
(a) Applicants granted the authority
to charge market-based rates under
§ 284.503 that provide cost-based service(s) must separately account for all
costs and revenues associated with facilities used to provide the marketbased services. When it files to change
its cost-based rates, applicant must
provide a summary of the costs and
revenues associated with market-based
rates with applicable cross references
to §§ 154.312 and 154.313 of this chapter.
The summary statement must provide
the formulae and explain the bases
used in the allocation of common costs
between the applicant’s cost-based
services and its market-based services.
(b) A storage service provider granted
the authority to charge market-based
rates under § 284.503 is required to notify the Commission within 10 days of
acquiring knowledge of significant
changes occurring in its market power
status. Such notification should include a detailed description of the new

facilities/services and their relationship to the storage service provider.
Significant changes include, but are
not limited to:
(1) The storage provider expanding
its storage capacity beyond the
amount authorized in this proceeding;
(2) The storage provider acquiring
transportation facilities or additional
storage capacity;
(3) An affiliate providing storage or
transportation services in the same
market area; and
(4) The storage provider or an affiliate acquiring an interest in or is acquired by an interstate pipeline.
§ 284.505 Market-based rates for storage providers without a marketpower determination.
(a) Any storage service provider seeking market-based rates for storage capacity, pursuant to the authority of
section 4(f) of the Natural Gas Act, related to a specific facility put into
service after August 8, 2005, may apply
for market-based rates by complying
with the following requirements:
(1) The storage service provider must
demonstrate that market-based rates
are in the public interest and necessary
to encourage the construction of the
storage capacity in the area needing
storage services; and
(2) The storage service provider must
provide a means of protecting customers from the potential exercise of
market power.
(b) Any storage service provider seeking market-based rates for storage capacity pursuant to this section will be
presumed by the Commission to have
market power.

PART 286—ACCOUNTS, RECORDS,
MEMORANDA AND DISPOSITION
OF CONTESTED AUDIT FINDINGS
AND PROPOSED REMEDIES
Sec.
286.101
286.102

Application for stay.
Application for rehearing.

DISPOSITION OF CONTESTED AUDIT FINDINGS
AND PROPOSED REMEDIES
286.103 Notice to audited person.
286.104 Response to notification.
286.105 Shortened procedure.
286.106 Form and style.
286.107 Verification.

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