18 Cfr 284.262

§ 284.261

18 CFR Ch. I (4–1–02 Edition)

transportation capacity, including contract storage, on all upstream pipelines, whether the firm capacity is authorized under part 284 or part 157. An
upstream pipeline is authorized and required to permit a downstream pipeline
to assign its firm capacity to the downstream pipeline’s firm shippers.
[Order 636, 57 FR 13318, Apr. 16, 1992, as
amended by Order 636–A, 57 FR 36217, Aug. 12,
1992]

Subpart I—Emergency Natural
Gas Sale, Transportation, and
Exchange Transactions
SOURCE: Order 449, 51 FR 9187, Mar. 18, 1986,
unless otherwise noted.

§ 284.261 Purpose.
This subpart exempts a person who
engages in an emergency natural gas
transaction, as defined for purposes of
this subpart, in interstate commerce
from the certificate requirements of
section 7 of the Natural Gas Act and
from the conditions of § 284.10, except
as provided in § 284.266, and §§ 284.7–284.9
and §§ 284.11–284.13 of subpart A of this
chapter.
§ 284.262 Definitions.
For purposes of this subpart:
Emergency means:
(1) Any situation in which an actual
or expected shortage of gas supply or
capacity would require an interstate
pipeline company, intrastate pipeline,
local distribution company, or Hinshaw
pipeline to curtail deliveries of gas or
provide less than the projected level of
service to any pipeline customer, including any situation in which additional supplies or capacity are necessary to ensure a pipeline’s contracted
level of service to any customer, but
not including any situation in which
additional supplies or capacity are
needed to increase the contracted level
of service to an existing customer or to
provide service to a new customer; or
(2) A sudden unanticipated loss of
natural gas supply or capacity; or
(3) An anticipated loss of natural gas
supply or capacity due to a foreseeable
facility outage resulting from a landslide or riverbed erosion or other natural forces beyond the participant’s

control. Participants may seek a temporary certificate under §§ 157.17 of this
chapter if the facilities to remedy the
emergency cannot be constructed automatically under § 2.55(b) or § 157.208(a)
of this chapter.
(4) A situation in which the participant, in good faith, determines that
immediate action is required or is reasonably anticipated to be required for
protection of life or health or for maintenance of physical property.
Emergency does not mean any situation resulting from a failure by any
person to transport natural gas under
subpart B, C, or G of this part.
Projected level of service means the
level of gas volumes to be delivered by
the company for each customer and additional gas volumes needed by a customer due solely to a weather-induced
increase in requirements.
Emergency natural gas means natural
gas sold, transported, or exchanged in
an emergency natural gas transaction.
Emergency natural gas transaction
means the sale, transportation, or exchange of natural gas (including the
construction and operation of necessary facilities) conducted pursuant to
this subpart, that is:
(1) Necessary to alleviate an emergency; and
(2) Not anticipated to extend for
more than 60 days in duration.
Emergency facilities means any facilities necessary to alleviate the emergency within the time frame established in § 284.264(b). Participants can
seek permanent authority to operate
the emergency facilities either under
the temporary certificate provisions of
§ 157.17 of this chapter or the prior notice provisions of § 157.208(b) of this
chapter.
Participant means any first seller,
interstate pipeline, intrastate pipeline,
local distribution company or Hinshaw
pipeline that participates in an emergency natural gas transaction under
this subpart.
Recipient means:
(1) In the case of a sale of emergency
natural gas, the purchaser of such gas;
or
(2) In the case of a transportation or
exchange of natural gas when there is
no sale of emergency natural gas under

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Federal Energy Regulatory Commission
this subpart, the participant who receives the gas.
Hinshaw pipeline means a pipeline
that is exempt from the Natural Gas
Act jurisdiction of the Commission by
reason of section 1(c) of the Natural
Gas Act.
[Order 603, 64 FR 26610, May 14, 1999]

§ 284.263 Exemption from section 7 of
Natural Gas Act and certain regulatory conditions.
Any participant that engages in an
emergency natural gas transaction
conducted in accordance with this subpart is exempt from the requirements
of section 7 of the Natural Gas Act and
the conditions of § 284.10, except as provided in § 284.266, and from the requirements of §§ 284.7–284.9 and §§ 284.11–284.13
of subpart A of this part. Participation
in any emergency natural gas transaction will not subject any participant
to the jurisdiction of the Commission
under section 7 of the Natural Gas Act
except to the extent such transaction
is provided for in this subpart.
§ 284.264 Terms and conditions.
(a) General conditions. (1) A participant must make every reasonable attempt to minimize use of emergency
natural gas transactions.
(2) Before deliveries of emergency
natural gas commence, a responsible
official of the recipient must provide
any participants in the emergency natural gas transaction sufficient information to enable the participants to form
a good faith belief that an emergency
exists or is imminent.
(3) No participant may engage in an
emergency natural gas transaction if
its participation will adversely affect
service to its existing customers.
(4) A participant may not sell emergency natural gas if, during the term of
the sale, it is also purchasing emergency natural gas under this subpart,
except when natural gas is being sold
to relieve an emergency on another,
separate segment of the participant’s
system.
(5) An interstate pipeline, acting in
an emergency gas transaction as a
broker or agent on behalf of another
participant or any other person, may
not receive compensation for such brokerage or agency service.

§ 284.266
(6) A recipient of emergency natural
gas that directly benefits from the
service must:
(i) Provide line loss and the fuel volumes required to transport the emergency natural gas; and
(ii) Pay for the facilities required to
be constructed to conduct the emergency natural gas transaction.
(b) Duration—(1) Emergency sale or
transportation. An emergency natural
gas transaction is limited to 60 consecutive calender days, except that
such transaction may be continued for
an additional 60 consecutive days if:
(i) Fifteen days prior to the end of
the initial 60-day period, the recipient
of emergency natural gas files a petition that:
(A) Describes fully the continued
emergency,
(B) Requests a waiver of the intitial
60-day limitation and permission for an
extension of the transaction for an additional 60 days; and
(ii) Within the 15-day period, the
Commission does not, by order, prohibit continuation of the emergency
natural gas transaction for the additional 60-day period.
(2) Redelivery in emergency exchange.
The redelivery of emergency natural
gas received under an exchange arrangement must occur within 180 consecutive days following the termination of deliveries of the emergency
natural gas.
§ 284.265 Cost recovery by interstate
pipeline.
(a) Except as provided in paragraph
(b), an interstate pipeine that provides
emergency natural gas, whether from
its system supply or by special purchase, must directly assign the emergency gas costs to the recipient.
(b) If an interstate pipeline cannot
identify individual recipients, the
interstate pipeline must roll the emergency gas costs into its general system
supply costs.
§ 284.266 Rates and charges for interstate pipelines.
(a) Transportation rates—(1) Rate on
file. If an interstate pipeline has on file
with the Commission an effective

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