80 FR 80302 - Ownership Information in Market-Based Rate Filings
DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission Federal Register Volume 80, Issue 247 (December 24, 2015)
Federal Energy Regulatory Commission
Federal Register Volume 80, Issue 247 (December 24, 2015)
| Page Range | 80302-80307 | |
| FR Document | 2015-32273 |
[Federal Register Volume 80, Number 247 (Thursday, December 24, 2015)] [Proposed Rules] [Pages 80302-80307] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-32273] ======================================================================= ----------------------------------------------------------------------- DEPARTMENT OF ENERGY Federal Energy Regulatory Commission 18 CFR Part 35 [Docket No. RM16-3-000] Ownership Information in Market-Based Rate Filings AGENCY: Federal Energy Regulatory Commission, Energy. ACTION: Notice of proposed rulemaking. ----------------------------------------------------------------------- SUMMARY: The Federal Energy Regulatory Commission (Commission) proposes to amend its regulations to clarify the scope of ownership information that sellers seeking to obtain or retain market-based rate authority must provide. The Commission proposes to find that the current policy that requires sellers to provide comprehensive ownership information is not necessary for the Commission's assessment of horizontal or vertical market power. The Commission further proposes to amend its regulations to clarify the types of ownership changes that must be [[Page 80303]] reported to the Commission via a notice of change in status. DATES: Comments are due February 22, 2016. ADDRESSES: Comments, identified by docket number, may be filed in the following ways:Electronic Filing through http://www.ferc.gov. Documents created electronically using word processing software should be filed in native applications or print-to-PDF format and not in a scanned format. Mail/Hand Delivery: Those unable to file electronically may mail or hand-deliver comments to: Federal Energy Regulatory Commission, Secretary of the Commission, 888 First Street NE., Washington, DC 20426. Instructions: For detailed instructions on submitting comments and additional information on the rulemaking process, see the Comment Procedures Section of this document. FOR FURTHER INFORMATION CONTACT: Ashley Dougherty (Technical Information), Office of Energy Market Regulation, Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, (202) 502-8851, [email protected]. Laura Chipkin (Legal Information), Office of General Counsel, Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, (202) 502-8615, [email protected]. SUPPLEMENTARY INFORMATION: Table of Contents Paragraph Numbers I. Background............................................... 2 II. Proposed Reform......................................... 6 A. Ownership Information Required in Initial 6 Applications and Triennial Updated Market Power Analyses............................................... B. Ownership Information Required in Change in Status 15 Filings................................................ III. Information Collection Statement....................... 18 IV. Environmental Analysis.................................. 22 V. Regulatory Flexibility Act............................... 24 VI. Comment Procedures...................................... 25 VII. Document Availability.................................. 29 Notice of Proposed Rulemaking (December 17, 2015) 1. In this Notice of Proposed Rulemaking (NOPR), the Commission proposes to amend its regulations to clarify the scope of ownership information that sellers seeking to obtain or retain market-based rate authority must provide.\1\ The Commission proposes to find that the current policy that requires sellers to provide comprehensive ownership information is not necessary for the Commission's assessment of horizontal or vertical market power. The Commission further proposes to amend its regulations to clarify the types of ownership changes that must be reported to the Commission via a notice of change in status. --------------------------------------------------------------------------- \1\ All references in this NOPR to ``seller'' (or ``sellers'') refer to both applicants seeking to obtain market-based rate authority and to sellers seeking to retain market-based rate authority. --------------------------------------------------------------------------- I. Background 2. The Commission allows power sales at market-based rates if the seller and its affiliates do not have, or have adequately mitigated, horizontal and vertical market power. In Order No. 697, the Commission stated that ``[t]he first step for a seller seeking market-based rate authority is to file an application to show that it and its affiliates do not have, or have adequately mitigated, market power.'' \2\ In Order No. 697, the Commission adopted two indicative screens for assessing horizontal market power: The pivotal supplier screen and the wholesale market share screen, each of which serves as a cross check on the other to determine whether sellers may have market power and should be further examined.\3\ With respect to the vertical market power analysis, in cases where a public utility or any of its affiliates owns, operates, or controls transmission facilities, the Commission requires that there be a Commission-approved Open Access Transmission Tariff (OATT) on file or that the seller or its applicable affiliate has received waiver of the OATT requirement or qualifies for the blanket OATT waiver provided by Order No. 807,\4\ before granting a seller market-based rate authorization.\5\ The Commission also considers a seller's ability to erect other barriers to entry as part of the vertical market power analysis.\6\ As such, the Commission requires a seller to provide a description of its ownership or control of, or affiliation with an entity that owns or controls, intrastate natural gas transportation, storage or distribution facilities; and physical coal supply sources and ownership of or control over who may access transportation of coal supplies.\7\ In addition, a seller is required to make an affirmative statement that it and its affiliates have not erected barriers to entry into the relevant market and will not erect barriers to entry into the relevant market.\8\ --------------------------------------------------------------------------- \2\ Market-Based Rates for Wholesale Sales of Electric Energy, Capacity and Ancillary Services by Public Utilities, Order No. 697, FERC Stats. & Regs. ] 31,252, at P 290, clarified, 121 FERC ] 61,260 (2007) (Clarifying Order), order on reh'g, Order No. 697-A, FERC Stats. & Regs. ] 31,268, clarified, 124 FERC ] 61,055, order on reh'g, Order No. 697-B, FERC Stats. & Regs. ] 31,285 (2008), order on reh'g, Order No. 697-C, FERC Stats. & Regs. ] 31,291 (2009), order on reh'g, Order No. 697-D, FERC Stats. & Regs. ] 31,305 (2010), aff'd sub nom. Mont. Consumer Counsel v. FERC, 659 F.3d 910 (9th Cir. 2011), cert. denied, 133 S. Ct. 26 (2012). \3\ Id., FERC Stats. & Regs. ] 31,252 at PP 62-63. \4\ Open Access and Priority Rights on Interconnection Customer's Interconnection Facilities, Order No. 807, 80 FR 17,654 (Apr. 1, 2015), FERC Stats. & Regs. ] 31,367 (2015). \5\ Order No. 697, FERC Stats. & Regs. ] 31,252 at P 408. See also Kingfisher Wind, LLC, 151 FERC ] 61,276, at PP 26-27 (2015) (providing guidance on how qualified sellers can claim blanket OATT waiver under Order No. 807 and demonstrate lack of vertical market power). \6\ Order No. 697, FERC Stats. & Regs. ] 31,252 at PP 440-451. \7\ Order No. 697, FERC Stats. & Regs. ] 31,252 at 447; 18 CFR 35.37(e) (2015). The Commission previously had also required sellers to describe sites for generation capacity, but eliminated this requirement in Order No. 816. See Refinements to Policies and Procedures for Market-Based Rates for Wholesale Sales of Electric Energy, Capacity and Ancillary Services by Public Utilities, Order No. 816, 80 FR 67,056 (Oct. 30, 2015), 153 FERC ] 61,065, at PP 212, 368 (2015) (Order No. 816). \8\ Order No. 697, FERC Stats. & Regs. ] 31,252 at PP 447-448. --------------------------------------------------------------------------- 3. On rehearing, in Order No. 697-A, the Commission set forth a requirement that a seller seeking to obtain or retain market-based rate authority must identify all of its upstream owners as well as describe the business activity of its owners and whether they are involved in the energy industry. Specifically, footnote 258 of Order No. 697-A states: A seller seeking market-based rate authority must provide information regarding its affiliates and its corporate structure or upstream ownership. To the extent that a seller's owners are themselves owned by others, the seller seeking to obtain or retain market-based rate authority must identify those upstream owners. Sellers must trace [[Page 80304]] upstream ownership until all upstream owners are identified. Sellers must also identify all affiliates. Finally, an entity seeking market-based rate authority must describe the business activities of its owners, stating whether they are in any way involved in the energy industry.\9\ --------------------------------------------------------------------------- \9\ Order No. 697-A, FERC Stats. & Regs. ] 31,268 at n.258. 4. However, as discussed below, after seven years of experience in implementing the requirements of footnote 258, we believe that the associated burdens on the industry of providing this information may outweigh the benefits of this information for purposes of assessing whether a seller should be granted market-based rate authorization.\10\ As part of that assessment, the Commission requires the submission of an asset appendix containing the generation and transmission assets of the seller and its affiliates.\11\ Further, in Order No. 816, the Commission instituted a requirement for the submission of a corporate organizational chart depicting all affiliates, as defined in section 35.36(a)(9) of the Commission's regulations.\12\ --------------------------------------------------------------------------- \10\ Market-based rate filings include initial market-based rate applications, notices of change in status and triennial updated market power analyses. \11\ Order No. 697, FERC Stats. & Regs. ] 31,252 at P 895; 18 CFR 35.37(a)(2) (2015). \12\ Order No. 816, 153 FERC ] 61,065 at P 333 (to be codified at 18 CFR 35.37(a)(2) (2015)). --------------------------------------------------------------------------- 5. In conjunction with the new organizational chart requirement in Order No. 816, we propose in this NOPR to provide a new complementary framework under which sellers can describe their ownership structure, as described more fully below. Consistent with this new framework, we also propose to clarify when a change in ownership would trigger the requirement in section 35.42 to file a notice of change in status. II. Proposed Reform A. Ownership Information Required in Initial Applications and Triennial Updated Market Power Analyses 6. Following the issuance of Order No. 697-A in 2008, corporate families, structures, and ownership in the energy industry have become increasingly complex. Through the Commission's implementation of the requirements of footnote 258, it has become clear that the upstream ownership structure of sellers is often layered with numerous levels and types of ownership interests (e.g., full and partial, passive and controlling, etc.). In many instances, sellers initially do not fully comply with the requirements of footnote 258 in their market-based rate filings. Many sellers have difficulty obtaining the names of all owners, particularly those that own a small percentage of the seller or are a partial owner of a partial indirect owner. As a result, in response to requests by Commission staff for the information required by footnote 258, some sellers submit multiple amendments to their filings, resulting in extra expenditures for the seller and significant processing delays for information that does not directly affect the analysis of the seller's market power. 7. Sellers have frequently alleged that it is very difficult to identify and describe individual shareholders, particularly those with less than ten percent voting interests, because they do not know and cannot obtain this information themselves.\13\ In such circumstances, strict adherence to the requirements of footnote 258 could require rejection of filings on procedural grounds irrespective of any market power concerns.\14\ --------------------------------------------------------------------------- \13\ See, e.g., 2014 ESA Project Company, LLC, Amended Filing at 2, Docket No. ER15-1496-001 (filed June 4, 2015) (``Shareholders are not required to notify, or obtain consent from, [Applicant's managing organization] when shareholders transfer their shares or the associate beneficial interests or voting rights''). \14\ See 18 CFR 35.5 (2015) (providing for rejection of rate filing for failure to comply with the applicable requirements). --------------------------------------------------------------------------- 8. As noted above, a seller seeking market-based rate authority must show that it and its affiliates do not have, or have adequately mitigated, horizontal market power. Further, the Commission's review of a seller's ability to exercise vertical market power, whether through ownership of transmission facilities or other barriers to entry, involves examining the seller and its affiliates.\15\ However, because information about owners that are not considered affiliates under section 35.36(a)(9) is not necessary to evaluate horizontal and/or vertical market power (and is not required to be identified in the asset appendix or the corporate organizational chart), continuing to require information on unaffiliated owners may create a burden that is unrelated to the Commission's approach to determining whether a seller should have market-based-rate authority.\16\ --------------------------------------------------------------------------- \15\ See 18 CFR 35.37 (2015). \16\ We note that the Commission recently issued a NOPR seeking comment on a proposal to require each regional transmission organization and independent system operator to electronically deliver to the Commission data from market participants that lists market participants' ``connected entities,'' including entities that have certain ownership, employment, debt or contractual relationships to the market participant, and describes the nature of such relationships. See Collection of Connected Entity Data from Regional Transmission Organizations and Independent System Operators, Docket No. RM15-23-000, 80 FR 58,382 (Sept. 29, 2015), FERC Stats. & Regs. ] 32,711 (2015) (cross-referenced at 152 FERC ] 61,219 (2015)). We recognize that some of the ownership information that is proposed herein to be no longer necessary for determining whether to grant market-based rate authority would be required under the connected entities NOPR for the purposes described in that proceeding. --------------------------------------------------------------------------- 9. Accordingly, we propose to amend section 35.37(a)(2) of the Commission's regulations to provide a new framework under which sellers would be required to describe their ownership structure that is both less burdensome for the industry and more useful to the Commission for purposes of whether a seller should have market-based-rate authority. Under this new framework, we propose to revise section 35.37(a)(2) of the Commission's regulations to define an affiliate owner as an owner that meets the definition of affiliate provided in 18 CFR 35.36(a)(9).\17\ We propose to require that a seller seeking to obtain or retain market-based rate authority identify and describe two categories of upstream owners. First, a seller must identify and describe the furthest upstream affiliate owner(s) in its ownership chain, which we propose to define as the seller's ``ultimate affiliate owner(s).'' \18\ Second, a seller must identify and describe all affiliate owners that have a franchised service area or market-based rate authority, or that directly own or control: Generation; transmission; intrastate natural gas transportation, storage or distribution facilities; physical coal supply sources or ownership of or control over who may access transportation of coal [[Page 80305]] supplies.\19\ To the extent that an affiliate owner does not fall into either of the two categories described above, the seller will not need to identify it when describing its ownership structure. --------------------------------------------------------------------------- \17\ As specified in the Commission's current regulations, ``affiliate'' of a specified company means: (i) Any person that directly or indirectly owns, controls, or holds with power to vote, 10 percent or more of the outstanding voting securities of the specified company; (ii) Any company 10 percent or more of whose outstanding voting securities are owned, controlled, or held with power to vote, directly or indirectly, by the specified company; (iii) Any person or class of persons that the Commission determines, after appropriate notice and opportunity for hearing, to stand in such relation to the specified company that there is liable to be an absence of arm's-length bargaining in transactions between them as to make it necessary or appropriate in the public interest or for the protection of investors or consumers that the person be treated as an affiliate; and (iv) Any person that is under common control with the specified company. For purposes of paragraph (a)(9)of the Commission's regulations, owning, controlling or holding with power to vote, less than 10 percent of the outstanding voting securities of a specified company creates a rebuttable presumption of lack of control. 18 CFR 35.36(a)(9) (2015). \18\ A seller may have more than one ultimate affiliate owner. For example, if a seller is owned 50 percent by affiliate A and 50 percent by affiliate B, there are two ownership ``chains'' or ``branches.'' The seller must identify and describe the ultimate affiliate owner at the top of each chain/branch, i.e., the last affiliate owner in that chain/branch. \19\ To the extent sellers will be describing such affiliate owners in the horizontal and vertical market power sections of the filing, that description will fulfill this requirement. --------------------------------------------------------------------------- 10. Identifying the ultimate affiliate owner is necessary for the Commission to form a meaningful picture of a seller's ownership structure and to understand what affiliates ultimately have the power to influence a seller's operations. The seller should also describe each ultimate affiliate owner's connection to the seller, and this description should be sufficient to allow the Commission to understand the relation between the seller and the ultimate affiliate owner(s), and could include references to the required corporate organizational chart. Identifying affiliate owners that have a franchised service area or market-based rate authority, or that directly own or control: Generation; transmission; intrastate natural gas transportation, storage or distribution facilities; physical coal supply sources or ownership of or control over who may access transportation of coal supplies assists the Commission in its analysis of a seller's horizontal and vertical market power. 11. In addition, where sellers are directly or indirectly owned or controlled by a foreign government or any political subdivision of a foreign government or any corporation which is owned in whole or in part by such entity, we propose to require that the seller identify such foreign government, political subdivision, or corporation. 12. We caution sellers to examine all ownership information to ensure that the required affiliate owners are identified. Sellers should not assume that owners are not affiliates of the seller without looking to the top of the ownership chain. For example, suppose seller (Company A) has four owners (Companies B, C, D, and E) each of which directly owns eight percent of the voting securities of A. If Company F owns 100 percent of the voting securities of Companies B, C, D, and E, under the Commission's affiliate definition, Company F indirectly owns 32 percent of the voting securities of Company A and is an affiliate of Company A. Under our proposed new framework, sellers must identify Company F only if Company F is an ultimate affiliate owner or if it is an affiliate owner that has a franchised service area or market-based rate authority, or that directly owns or controls: Generation; transmission; intrastate natural gas transportation, storage or distribution facilities; physical coal supply sources or ownership of or control over who may access transportation of coal supplies.\20\ --------------------------------------------------------------------------- \20\ We further caution sellers to be mindful that the Commission does not allow for a derivative share method to calculate ownership interests in downstream, partially-owned entities for purposes of identifying affiliates. See Tonopah Solar Energy, LLC, 151 FERC ] 61,203, at PP 11-12 (2015). --------------------------------------------------------------------------- 13. With respect to owners that a seller represents to be passive, we propose to require that the seller affirm that its passive owners own a separate class of securities, have limited consent rights, do not exercise day-to-day control over the company, and cannot remove the manager without cause.\21\ --------------------------------------------------------------------------- \21\ See, e.g., AES Creative Resources, L.P., 129 FERC ] 61,239 (2009) (AES Creative) (distinguishing between controlling interests and passive investment interests). See also EquiPower Resources Management, LLC, Docket No. ER10-1089-000 (June 16, 2010) (deficiency letter asking seller to demonstrate that certain interests were passive by providing answers to clarifying questions). --------------------------------------------------------------------------- 14. We seek comments on these proposals. B. Ownership Information Required in Change in Status Filings 15. The Commission requires market-based rate sellers to timely report any change in status that would ``reflect a departure from the characteristics that the Commission relied upon in granting market- based rate authority.'' Section 35.42 of the Commission's regulations, 18 CFR 35.42, which provides a non-exhaustive list of events that could trigger the change in status reporting requirement, is silent as to generic ownership changes, but requires that a seller must report certain new affiliations with any entity not disclosed in the application for market-based rate authority that has a franchised service area, or that directly owns or controls: generation facilities; transmission facilities; intrastate natural gas transportation, storage or distribution facilities; physical coal supply sources or ownership of or control over who may access transportation of coal supplies. However, a literal reading of footnote 258 requires sellers to report changes in upstream ownership via notices of change in status filings.\22\ --------------------------------------------------------------------------- \22\ Footnote 258 provides: ``To the extent that a seller's owners are themselves owned by others, the seller seeking to obtain or retain market-based rate authority must identify those upstream owners.'' See Order No. 687-A, FERC Stats. & Regs. ] 31,628 at n.258 (emphasis added). --------------------------------------------------------------------------- 16. We believe that uncertainty as to the interpretation of footnote 258 has led to inconsistent reporting of changes in ownership. In our experience, some sellers report any change in ownership, other sellers only report changes in ownership when the new owner would be considered an affiliate pursuant to section 35.36(a)(9), and yet other sellers only report changes in ownership when the change in ownership causes a change in one of the triggering events explicitly listed in section 35.42. Accordingly, we propose to resolve the uncertainty and create a consistent reporting standard by amending section 35.42 of the Commission's regulations \23\ to specify the types of ownership changes that would require a change in status filing. --------------------------------------------------------------------------- \23\ In Order No. 816, the Commission amended, among other things, sections 35.37 and 35.42 of its regulations. The further proposed regulatory text changes in this NOPR are keyed off of the new regulatory text as promulgated in Order No. 816. --------------------------------------------------------------------------- 17. In light of our proposal to require sellers to identify and describe in their initial applications and triennial updated market power analyses their ultimate affiliate owners, and all affiliate owners that have franchised service areas or market-based rate authority or that directly own or control: generation; transmission; intrastate natural gas transportation, storage or distribution facilities; physical coal supply sources or ownership of or control over who may access transportation of coal supplies it follows that the identity of such affiliate owners are characteristics that the Commission relies upon in granting the seller market-based rate authority. However, we are also mindful of Order No. 816, in which the Commission amended section 35.42 to provide a 100 MW threshold for reporting new affiliations, and thus we propose that these two concepts be combined, as described below. In addition, we propose in the instant rulemaking to specify the following scenario as an additional departure from the characteristics the Commission relied upon in granting market- based rate authority and which should be reported to the Commission: when the seller acquires a new ultimate affiliate owner(s). Accordingly, we propose to require sellers to submit a notice of change in status in this scenario as well. In summary, combining all three of the above concepts, we propose that a change in status reporting requirement will be triggered by: (a) Any change in the seller's ultimate affiliate owner(s); or (b) the introduction of any new affiliate owner of the seller that has a franchised service area or that: directly owns or controls generation (if it represents a 100 MW or more net increase in seller and affiliate generation); owns, operates or controls transmission; or that directly [[Page 80306]] owns or controls: generation; transmission; intrastate natural gas transportation, storage or distribution facilities; physical coal supply sources or ownership of or control over who may access transportation of coal supplies.\24\ We remind sellers that the provisions in section 35.42(a)(1) apply to the seller and its affiliates because the Commission considers affiliates' assets when assessing a seller's horizontal and vertical market power.\25\ --------------------------------------------------------------------------- \24\ We note that some of these requirements exist in the current regulation or the regulation as revised by Order No. 816. \25\ See Order No. 697, FERC Stats. & Regs. ] 31,252 at P 1017 (``the Commission's change in status requirements are intended to track the requirements embedded in the horizontal and vertical analysis as well as the affiliate abuse representations.''). See also id. P 3 n.2 (major aspects of the Commission's market-based rate regulatory regime include ``whether a market-based rate seller or any of its affiliates has market power in generation or transmission and, if so, whether such market power has been mitigated'' and ``whether the seller or its affiliates can erect other barriers to entry.'') --------------------------------------------------------------------------- III. Information Collection Statement 18. The Paperwork Reduction Act (PRA) \26\ requires each federal agency to seek and obtain Office of Management and Budget (OMB) approval before undertaking a collection of information directed to ten or more persons or contained in a rule of general applicability. OMB's regulations,\27\ in turn, require approval of certain information collection requirements imposed by agency rules. Upon approval of a collection(s) of information, OMB will assign an OMB control number and an expiration date. Respondents subject to the filing requirements of a rule will not be penalized for failing to respond to these collection(s) of information unless the collection(s) of information display a valid OMB control number. --------------------------------------------------------------------------- \26\ 44 U.S.C. 3501-3520. \27\ 5 CFR 1320 (2015). --------------------------------------------------------------------------- 19. The Commission is submitting the proposed modifications to its information collection to OMB for review and approval in accordance with section 3507(d) of the Paperwork Reduction Act of 1995. 20. The following table provides the estimated burden reduction proposed in RM16-3: \28\ --------------------------------------------------------------------------- \28\ In Order No. 697-A, the Commission required that sellers seeking to obtain or retain market-based rate authority identify all upstream owners and affiliates. Order No. 697-A, FERC Stats. & Regs. ] 31,268 at P 181 n.258. The Commission most recently updated the burden estimates associated with the market-based rate program in Order No. 816, which will become effective on January 28, 2016. The PRA package and burden estimates for the Order No. 816 are pending OMB review. FERC-919, Estimated Changes, Due to Proposed Rule in RM16-3 -------------------------------------------------------------------------------------------------------------------------------------------------------- Annual number Type of requirement Number of of responses Total number of Average burden hours & cost Annual burden hours & total respondents per respondent responses per response \29\ annual cost (1) (2) (1) * (2) = (3) (4)......................... (3) * (4) = (5) -------------------------------------------------------------------------------------------------------------------------------------------------------- Reduction of requirement for sellers to 509 1 509 -40 hrs.; -$3,858 -20,360 hrs.; -$1,963,722 describe entire ownership structure in Initial Applications and Triennial Updated Market Power Analyses, & Change of Status --[Decrease in burden and cost]. -------------------------------------------------------------------------------------------------------------------------------------------------------- Title: FERC-919, Market Based Rates for Wholesale Sales of Electric Energy, Capacity and Ancillary Services by Public Utilities. --------------------------------------------------------------------------- \29\ The Commission estimates this figure based on the Bureau of Labor Statistics data (for the Utilities sector, at http://www.bls.gov/oes/current/naics2_22.htm, plus benefits information at http://www.bls.gov/news.release/ecec.nr0.htm). The average hourly cost (salary plus benefits) of $96.45 is based on the following occupational categories: Lawyer (Code 23-0000), $129.87/hour. Management Analyst (Code 13-1111), $63.03/hour. --------------------------------------------------------------------------- Action: Proposed revision to existing collection. OMB Control No: 1902-0234. Respondents: Business or other for profit, and not for profit institutions. Frequency of Responses: As needed. Necessity of the Information: This NOPR reduces the amount and scope of ownership information that sellers must provide in their market-based rate filings. Interested persons may obtain information on the reporting requirements by contacting the Federal Energy Regulatory Commission, Office of the Executive Director, 888 First Street NE., Washington, DC 20426 [Attention: Ellen Brown, email: [email protected], phone: (202) 502-8663, fax: (202) 273-0873]. 21. Comments concerning the information collection proposed in this NOPR and the associated burden estimates, should be sent to the Commission in this docket and may also be sent to the Office of Management and Budget, Office of Information and Regulatory Affairs [Attention: Desk Officer for the Federal Energy Regulatory Commission]. For security reasons, comments should be sent by email to OMB at the following email address: [email protected]. Please refer to OMB Control Number 1902-0234 in your submission to OMB. IV. Environmental Analysis 22. The Commission is required to prepare an Environmental Assessment or an Environmental Impact Statement for any action that may have a significant adverse effect on the human environment.\30\ --------------------------------------------------------------------------- \30\ Regulations Implementing the National Environmental Policy Act of 1969, Order No. 486, FERC Stats. & Regs. ] 30,783 (1987). --------------------------------------------------------------------------- 23. The Commission has categorically excluded certain actions from this requirement as not having a significant effect on the human environment. Included in the exclusion are rules that are clarifying, corrective, or procedural, or that do not substantially change the effect of the regulations being amended.\31\ The actions here fall within this categorical exclusion in the Commission's regulations. --------------------------------------------------------------------------- \31\ 18 CFR 380.4(a)(2)(ii) (2015). --------------------------------------------------------------------------- V. Regulatory Flexibility Act 24. The Regulatory Flexibility Act of 1980 (RFA) \32\ generally requires a description and analysis of proposed rules that will have significant economic impact on a substantial number of small entities. The Small Business Administration (SBA) revised its size standard (effective January 22, 2014) for electric utilities from a standard based on megawatt hours to a standard based on the number of [[Page 80307]] employees including affiliates.\33\ This NOPR, if adopted, reduces (for small and large entities) the burden and expense associated with filing market-based rate applications and triennial market power updates by clarifying the current regulations and by requiring identification of only the ultimate affiliate owner(s) and affiliate owners that directly own or control generation, transmission, or inputs to electric power production, have a franchised service area, or have market-based rate authority, rather than the comprehensive ownership information currently required. In addition, the Commission clarifies and limits the types of ownership changes that must be reported to the Commission via a notice of change in status. Accordingly, the Commission certifies that this NOPR, if adopted, will not have a significant economic impact on a substantial number of small entities. An analysis under the RFA is not required. --------------------------------------------------------------------------- \32\ 5 U.S.C. 601-612 (2012). \33\ SBA Final Rule on ``Small Business Size Standards: Utilities,'' 78 FR 77,343 (Dec. 23, 2013). --------------------------------------------------------------------------- VI. Comment Procedures 25. The Commission invites interested persons to submit comments on the matters and issues proposed in this notice to be adopted, including any related matters or alternative proposals that commenters may wish to discuss. Comments are due February 22, 2016. Comments must refer to Docket No. RM16-3-000, and must include the commenter's name, the organization they represent, if applicable, and their address in their comments. 26. The Commission encourages comments to be filed electronically via the eFiling link on the Commission's Web site at http://www.ferc.gov. The Commission accepts most standard word processing formats. Documents created electronically using word processing software should be filed in native applications or print-to-PDF format and not in a scanned format. Commenters filing electronically do not need to make a paper filing. 27. Commenters that are not able to file comments electronically must send an original of their comments to: Federal Energy Regulatory Commission, Secretary of the Commission, 888 First Street NE., Washington, DC 20426. 28. All comments will be placed in the Commission's public files and may be viewed, printed, or downloaded remotely as described in the Document Availability section below. Commenters on this proposal are not required to serve copies of their comments on other commenters. VII. Document Availability 29. In addition to publishing the full text of this document in the Federal Register, the Commission provides all interested persons an opportunity to view and/or print the contents of this document via the Internet through the Commission's Home Page (http://www.ferc.gov) and in the Commission's Public Reference Room during normal business hours (8:30 a.m. to 5:00 p.m. Eastern time) at 888 First Street NE., Room 2A, Washington, DC 20426. 30. From the Commission's Home Page on the Internet, this information is available on eLibrary. The full text of this document is available on eLibrary in PDF and Microsoft Word format for viewing, printing, and/or downloading. To access this document in eLibrary, type the docket number excluding the last three digits of this document in the docket number field. 31. User assistance is available for eLibrary and the Commission's Web site during normal business hours from the Commission's Online Support at 202-502-6652 (toll free at 1-866-208-3676) or email at [email protected], or the Public Reference Room at (202) 502- 8371, TTY (202) 502-8659. Email the Public Reference Room at [email protected]. List of Subjects in 18 CFR Part 35 Electric power rates; Electric utilities; Reporting and record- keeping requirements. By direction of the Commission. Issued: December 17, 2015. Nathaniel J. Davis, Sr., Deputy Secretary. In consideration of the foregoing, the Commission proposes to amend Chapter I, Title 18, Code of Federal Regulations, to read as follows: PART 35--FILING OF RATE SCHEDULES AND TARIFFS 0 1. The authority citation for Part 35 continues to read as follows: Authority: 16 U.S.C. 791a-825r; 2601-2645; 31 U.S.C. 9701; 42 U.S.C. 7101-7352. 0 2. Amend Sec. 35.37 by revising paragraph (a)(2) to read as follows: Sec. 35.37 Market power analysis required. (a)(1) * * * (2) When submitting a market power analysis, whether as part of an initial application or an update, a Seller must include a description of its ownership structure that identifies all ultimate affiliate owner(s), i.e., the furthest upstream affiliate(s) in the ownership chain. A Seller must also identify all affiliate owners that have a franchised service area or market-based rate authority, and all affiliate owners that directly own or control: Generation; transmission; intrastate natural gas transportation, storage or distribution facilities; physical coal supply sources or ownership of or control over who may access transportation of coal supplies. The term ``affiliate owner'' means any owner of the Seller that is an affiliate of the Seller as defined in Sec. 35.36(a)(9) of this chapter. The Seller must also provide an appendix of assets in the form provided in Appendix B of this subpart and an organizational chart. The organizational chart must depict the Seller's current corporate structure indicating all affiliates. * * * * * 0 3. Amend Sec. 35.42 by revising paragraph (a)(2)(iv) and adding paragraph (a)(2)(v) to read as follows: Sec. 35.42 Change in status reporting requirement. (a) * * * (2) * * * (iv) Has a franchised service area; or (v) Is an ultimate affiliate owner, defined as the furthest upstream affiliate(s) in the ownership chain. * * * * * [FR Doc. 2015-32273 Filed 12-23-15; 8:45 am] BILLING CODE 6717-01-P
![80302 Federal Register / Vol. 80, No. 247 / Thursday, December 24, 2015 / Proposed Rules
supporting the views and suggestions The Proposal PART 71—DESIGNATION OF CLASS A,
presented are particularly helpful in B, C, D, AND E AIRSPACE AREAS; AIR
developing reasoned regulatory The FAA is proposing an amendment TRAFFIC SERVICE ROUTES; AND
decisions on the proposal. Comments to Title 14, Code of Federal Regulations REPORTING POINTS
are specifically invited on the overall (14 CFR), Part 71 by establishing Class
regulatory, aeronautical, economic, E airspace extending upward from 700 ■ 1. The authority citation for 14 CFR
environmental, and energy-related feet above the surface within an 11.0- part 71 continues to read as follows:
aspects of the proposal. mile radius of Danville Municipal Authority: 49 U.S.C. 106(f), 106(g), 40103,
Communications should identify both Airport, Danville, AR, to accommodate 40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR,
docket numbers and be submitted in new standard instrument approach 1959–1963 Comp., p. 389.
triplicate to the address listed above. procedures. Controlled airspace is
Commenters wishing the FAA to § 71.1 [Amended]
needed for the safety and management
acknowledge receipt of their comments of IFR operations at the airport. ■ 2. The incorporation by reference in
on this notice must submit with those 14 CFR 71.1 of FAA Order 7400.9Z,
Class E airspace designations are Airspace Designations and Reporting
comments a self-addressed, stamped
published in Paragraph 6005 of FAA Points, dated August 6, 2015, and
postcard on which the following
Order 7400.9Z, dated August 6, 2015, effective September 15, 2015, is
statement is made: ‘‘Comments to
Docket No. FAA–2015–4836/Airspace and effective September 15, 2015, which amended as follows:
Docket No. 15–ASW–16.’’ The postcard is incorporated by reference in 14 CFR
will be date/time stamped and returned 71.1. The Class E airspace designation Paragraph 6005 Class E Airspace Areas
listed in this document will be Extending Upward from 700 feet or More
to the commenter. Above the Surface of the Earth.
published subsequently in the Order.
Availability of NPRMs * * * * *
Regulatory Notices and Analyses ASW AR E5 Danville, AR [New]
An electronic copy of this document Danville Municipal Airport, AR
may be downloaded through the The FAA has determined that this (Lat. 35°05′13″ N., long. 093°25′39″ W.)
Internet at http://www.regulations.gov. regulation only involves an established That airspace extending upward from 700
Recently published rulemaking body of technical regulations for which feet above the surface within a 11.0-mile
documents can also be accessed through frequent and routine amendments are radius of Danville Municipal Airport.
the FAA’s Web page at http:// necessary to keep them operationally Issued in Fort Worth, TX, on December 15,
www.faa.gov/airports_airtraffic/air_ current, is non-controversial and 2015.
traffic/publications/airspace_ unlikely to result in adverse or negative Robert W. Beck,
amendments/. comments. It, therefore: (1) is not a Manager, Operations Support Group, ATO
You may review the public docket ‘‘significant regulatory action’’ under Central Service Center.
containing the proposal, any comments Executive Order 12866; (2) is not a [FR Doc. 2015–32157 Filed 12–23–15; 8:45 am]
received and any final disposition in ‘‘significant rule’’ under DOT BILLING CODE 4910–13–P
person in the Dockets Office (see Regulatory Policies and Procedures (44
ADDRESSES section for address and FR 11034; February 26, 1979); and (3)
phone number) between 9:00 a.m. and does not warrant preparation of a DEPARTMENT OF ENERGY
5:00 p.m., Monday through Friday, regulatory evaluation as the anticipated
except Federal holidays. An informal impact is so minimal. Since this is a Federal Energy Regulatory
docket may also be examined during routine matter that will only affect air Commission
normal business hours at the Central traffic procedures and air navigation, it
Service Center, Operation Support is certified that this rule, when 18 CFR Part 35
Group, 10101 Hillwood Parkway, Fort promulgated, would not have a [Docket No. RM16–3–000]
Worth, TX 76177. significant economic impact on a
Persons interested in being placed on substantial number of small entities Ownership Information in Market-
a mailing list for future NPRMs should under the criteria of the Regulatory Based Rate Filings
contact the FAA’s Office of Rulemaking Flexibility Act. AGENCY: Federal Energy Regulatory
(202) 267–9677, to request a copy of Commission, Energy.
Advisory Circular No. 11–2A, Notice of Environmental Review
ACTION: Notice of proposed rulemaking.
Proposed Rulemaking Distribution This proposal will be subject to an
System, which describes the application environmental analysis in accordance SUMMARY: The Federal Energy
procedure. with FAA Order 1050.1F, Regulatory Commission (Commission)
Availability and Summary of ‘‘Environmental Impacts: Policies and proposes to amend its regulations to
Documents Proposed for Incorporation Procedures’’ prior to any FAA final clarify the scope of ownership
by Reference regulatory action. information that sellers seeking to
obtain or retain market-based rate
This document would amend FAA List of Subjects in 14 CFR Part 71 authority must provide. The
Order 7400.9Z, Airspace Designations Commission proposes to find that the
Airspace, Incorporation by reference,
tkelley on DSK3SPTVN1PROD with PROPOSALS
and Reporting Points, dated August 6, current policy that requires sellers to
2015, and effective September 15, 2015. Navigation (Air). provide comprehensive ownership
FAA Order 7400.9Z is publicly available The Proposed Amendment information is not necessary for the
as listed in the ADDRESSES section of this Commission’s assessment of horizontal
document. FAA Order 7400.9Z lists In consideration of the foregoing, the or vertical market power. The
Class A, B, C, D, and E airspace areas, Federal Aviation Administration Commission further proposes to amend
air traffic service routes, and reporting proposes to amend 14 CFR part 71 as its regulations to clarify the types of
points. follows: ownership changes that must be
VerDate Sep<11>2014 17:42 Dec 23, 2015 Jkt 238001 PO 00000 Frm 00012 Fmt 4702 Sfmt 4702 E:\FR\FM\24DEP1.SGM 24DEP1](https://thefederalregister.org/doc/80_FR_80549/page/1.svg)
![Federal Register / Vol. 80, No. 247 / Thursday, December 24, 2015 / Proposed Rules 80303
reported to the Commission via a notice • Mail/Hand Delivery: Those unable Regulation, Federal Energy Regulatory
of change in status. to file electronically may mail or hand- Commission, 888 First Street NE.,
DATES: Comments are due February 22, deliver comments to: Federal Energy Washington, DC 20426, (202) 502–
2016. Regulatory Commission, Secretary of the 8851, ashley.dougherty@ferc.gov.
Commission, 888 First Street NE.,
ADDRESSES: Comments, identified by Laura Chipkin (Legal Information),
Washington, DC 20426.
docket number, may be filed in the Instructions: For detailed instructions Office of General Counsel, Federal
following ways: on submitting comments and additional Energy Regulatory Commission, 888
• Electronic Filing through http:// information on the rulemaking process, First Street NE., Washington, DC
www.ferc.gov. Documents created see the Comment Procedures Section of 20426, (202) 502–8615,
electronically using word processing this document. laura.chipkin@ferc.gov.
software should be filed in native FOR FURTHER INFORMATION CONTACT: SUPPLEMENTARY INFORMATION:
applications or print-to-PDF format and Ashley Dougherty (Technical
not in a scanned format. Information), Office of Energy Market Table of Contents
Paragraph Numbers
I. Background ............................................................................................................................................................................................ 2
II. Proposed Reform .................................................................................................................................................................................. 6
A. Ownership Information Required in Initial Applications and Triennial Updated Market Power Analyses ......................... 6
B. Ownership Information Required in Change in Status Filings ................................................................................................. 15
III. Information Collection Statement ...................................................................................................................................................... 18
IV. Environmental Analysis ..................................................................................................................................................................... 22
V. Regulatory Flexibility Act ................................................................................................................................................................... 24
VI. Comment Procedures ......................................................................................................................................................................... 25
VII. Document Availability ...................................................................................................................................................................... 29
Notice of Proposed Rulemaking Commission adopted two indicative a description of its ownership or control
(December 17, 2015) screens for assessing horizontal market of, or affiliation with an entity that owns
1. In this Notice of Proposed power: The pivotal supplier screen and or controls, intrastate natural gas
Rulemaking (NOPR), the Commission the wholesale market share screen, each transportation, storage or distribution
proposes to amend its regulations to of which serves as a cross check on the facilities; and physical coal supply
clarify the scope of ownership other to determine whether sellers may sources and ownership of or control
information that sellers seeking to have market power and should be over who may access transportation of
obtain or retain market-based rate further examined.3 With respect to the coal supplies.7 In addition, a seller is
authority must provide.1 The vertical market power analysis, in cases required to make an affirmative
Commission proposes to find that the where a public utility or any of its statement that it and its affiliates have
current policy that requires sellers to affiliates owns, operates, or controls not erected barriers to entry into the
provide comprehensive ownership transmission facilities, the Commission relevant market and will not erect
information is not necessary for the requires that there be a Commission- barriers to entry into the relevant
Commission’s assessment of horizontal approved Open Access Transmission market.8
or vertical market power. The Tariff (OATT) on file or that the seller 3. On rehearing, in Order No. 697–A,
Commission further proposes to amend or its applicable affiliate has received the Commission set forth a requirement
its regulations to clarify the types of waiver of the OATT requirement or that a seller seeking to obtain or retain
ownership changes that must be qualifies for the blanket OATT waiver market-based rate authority must
reported to the Commission via a notice provided by Order No. 807,4 before identify all of its upstream owners as
of change in status. granting a seller market-based rate well as describe the business activity of
authorization.5 The Commission also its owners and whether they are
I. Background considers a seller’s ability to erect other involved in the energy industry.
2. The Commission allows power barriers to entry as part of the vertical Specifically, footnote 258 of Order No.
sales at market-based rates if the seller market power analysis.6 As such, the 697–A states:
and its affiliates do not have, or have Commission requires a seller to provide A seller seeking market-based rate
adequately mitigated, horizontal and authority must provide information regarding
vertical market power. In Order No. 697, FERC ¶ 61,055, order on reh’g, Order No. 697–B, its affiliates and its corporate structure or
FERC Stats. & Regs. ¶ 31,285 (2008), order on reh’g, upstream ownership. To the extent that a
the Commission stated that ‘‘[t]he first Order No. 697–C, FERC Stats. & Regs. ¶ 31,291
step for a seller seeking market-based seller’s owners are themselves owned by
(2009), order on reh’g, Order No. 697–D, FERC
others, the seller seeking to obtain or retain
rate authority is to file an application to Stats. & Regs. ¶ 31,305 (2010), aff’d sub nom. Mont.
market-based rate authority must identify
show that it and its affiliates do not Consumer Counsel v. FERC, 659 F.3d 910 (9th Cir.
2011), cert. denied, 133 S. Ct. 26 (2012). those upstream owners. Sellers must trace
have, or have adequately mitigated, 3 Id., FERC Stats. & Regs. ¶ 31,252 at PP 62–63.
market power.’’ 2 In Order No. 697, the 4 Open Access and Priority Rights on 7 Order No. 697, FERC Stats. & Regs. ¶ 31,252 at
Interconnection Customer’s Interconnection 447; 18 CFR 35.37(e) (2015). The Commission
Facilities, Order No. 807, 80 FR 17,654 (Apr. 1, previously had also required sellers to describe sites
tkelley on DSK3SPTVN1PROD with PROPOSALS
1 All references in this NOPR to ‘‘seller’’ (or
‘‘sellers’’) refer to both applicants seeking to obtain 2015), FERC Stats. & Regs. ¶ 31,367 (2015). for generation capacity, but eliminated this
market-based rate authority and to sellers seeking 5 Order No. 697, FERC Stats. & Regs. ¶ 31,252 at requirement in Order No. 816. See Refinements to
to retain market-based rate authority. P 408. See also Kingfisher Wind, LLC, 151 FERC Policies and Procedures for Market-Based Rates for
2 Market-Based Rates for Wholesale Sales of ¶ 61,276, at PP 26–27 (2015) (providing guidance on Wholesale Sales of Electric Energy, Capacity and
Electric Energy, Capacity and Ancillary Services by how qualified sellers can claim blanket OATT Ancillary Services by Public Utilities, Order No.
Public Utilities, Order No. 697, FERC Stats. & Regs. waiver under Order No. 807 and demonstrate lack 816, 80 FR 67,056 (Oct. 30, 2015), 153 FERC
¶ 31,252, at P 290, clarified, 121 FERC ¶ 61,260 of vertical market power). ¶ 61,065, at PP 212, 368 (2015) (Order No. 816).
(2007) (Clarifying Order), order on reh’g, Order No. 6 Order No. 697, FERC Stats. & Regs. ¶ 31,252 at 8 Order No. 697, FERC Stats. & Regs. ¶ 31,252 at
697–A, FERC Stats. & Regs. ¶ 31,268, clarified, 124 PP 440–451. PP 447–448.
VerDate Sep<11>2014 17:42 Dec 23, 2015 Jkt 238001 PO 00000 Frm 00013 Fmt 4702 Sfmt 4702 E:\FR\FM\24DEP1.SGM 24DEP1](https://thefederalregister.org/doc/80_FR_80549/page/2.svg)
![80304 Federal Register / Vol. 80, No. 247 / Thursday, December 24, 2015 / Proposed Rules
upstream ownership until all upstream have difficulty obtaining the names of 9. Accordingly, we propose to amend
owners are identified. Sellers must also all owners, particularly those that own section 35.37(a)(2) of the Commission’s
identify all affiliates. Finally, an entity a small percentage of the seller or are a regulations to provide a new framework
seeking market-based rate authority must
partial owner of a partial indirect under which sellers would be required
describe the business activities of its owners,
stating whether they are in any way involved owner. As a result, in response to to describe their ownership structure
in the energy industry.9 requests by Commission staff for the that is both less burdensome for the
information required by footnote 258, industry and more useful to the
4. However, as discussed below, after some sellers submit multiple
seven years of experience in Commission for purposes of whether a
amendments to their filings, resulting in seller should have market-based-rate
implementing the requirements of extra expenditures for the seller and
footnote 258, we believe that the authority. Under this new framework,
significant processing delays for we propose to revise section 35.37(a)(2)
associated burdens on the industry of information that does not directly affect
providing this information may of the Commission’s regulations to
the analysis of the seller’s market
outweigh the benefits of this define an affiliate owner as an owner
power.
information for purposes of assessing 7. Sellers have frequently alleged that that meets the definition of affiliate
whether a seller should be granted it is very difficult to identify and provided in 18 CFR 35.36(a)(9).17 We
market-based rate authorization.10 As describe individual shareholders, propose to require that a seller seeking
part of that assessment, the Commission particularly those with less than ten to obtain or retain market-based rate
requires the submission of an asset percent voting interests, because they do authority identify and describe two
appendix containing the generation and not know and cannot obtain this categories of upstream owners. First, a
transmission assets of the seller and its information themselves.13 In such seller must identify and describe the
affiliates.11 Further, in Order No. 816, circumstances, strict adherence to the furthest upstream affiliate owner(s) in
the Commission instituted a requirements of footnote 258 could its ownership chain, which we propose
requirement for the submission of a require rejection of filings on procedural to define as the seller’s ‘‘ultimate
corporate organizational chart depicting grounds irrespective of any market affiliate owner(s).’’ 18 Second, a seller
all affiliates, as defined in section power concerns.14 must identify and describe all affiliate
35.36(a)(9) of the Commission’s 8. As noted above, a seller seeking owners that have a franchised service
regulations.12 market-based rate authority must show area or market-based rate authority, or
5. In conjunction with the new that it and its affiliates do not have, or that directly own or control: Generation;
organizational chart requirement in have adequately mitigated, horizontal transmission; intrastate natural gas
Order No. 816, we propose in this NOPR market power. Further, the
to provide a new complementary transportation, storage or distribution
Commission’s review of a seller’s ability facilities; physical coal supply sources
framework under which sellers can to exercise vertical market power,
describe their ownership structure, as or ownership of or control over who
whether through ownership of may access transportation of coal
described more fully below. Consistent transmission facilities or other barriers
with this new framework, we also to entry, involves examining the seller
propose to clarify when a change in System Operators, Docket No. RM15–23–000, 80 FR
and its affiliates.15 However, because 58,382 (Sept. 29, 2015), FERC Stats. & Regs.
ownership would trigger the information about owners that are not ¶ 32,711 (2015) (cross-referenced at 152 FERC
requirement in section 35.42 to file a considered affiliates under section ¶ 61,219 (2015)). We recognize that some of the
notice of change in status. 35.36(a)(9) is not necessary to evaluate ownership information that is proposed herein to be
no longer necessary for determining whether to
II. Proposed Reform horizontal and/or vertical market power grant market-based rate authority would be required
(and is not required to be identified in under the connected entities NOPR for the purposes
A. Ownership Information Required in the asset appendix or the corporate described in that proceeding.
Initial Applications and Triennial organizational chart), continuing to 17 As specified in the Commission’s current
Updated Market Power Analyses require information on unaffiliated regulations, ‘‘affiliate’’ of a specified company
means: (i) Any person that directly or indirectly
6. Following the issuance of Order owners may create a burden that is owns, controls, or holds with power to vote, 10
No. 697–A in 2008, corporate families, unrelated to the Commission’s approach percent or more of the outstanding voting securities
structures, and ownership in the energy to determining whether a seller should of the specified company; (ii) Any company 10
have market-based-rate authority.16 percent or more of whose outstanding voting
industry have become increasingly securities are owned, controlled, or held with
complex. Through the Commission’s power to vote, directly or indirectly, by the
13 See, e.g., 2014 ESA Project Company, LLC,
implementation of the requirements of specified company; (iii) Any person or class of
Amended Filing at 2, Docket No. ER15–1496–001 persons that the Commission determines, after
footnote 258, it has become clear that (filed June 4, 2015) (‘‘Shareholders are not required appropriate notice and opportunity for hearing, to
the upstream ownership structure of to notify, or obtain consent from, [Applicant’s stand in such relation to the specified company that
sellers is often layered with numerous managing organization] when shareholders transfer there is liable to be an absence of arm’s-length
levels and types of ownership interests their shares or the associate beneficial interests or bargaining in transactions between them as to make
voting rights’’). it necessary or appropriate in the public interest or
(e.g., full and partial, passive and 14 See 18 CFR 35.5 (2015) (providing for rejection
for the protection of investors or consumers that the
controlling, etc.). In many instances, of rate filing for failure to comply with the person be treated as an affiliate; and (iv) Any person
sellers initially do not fully comply with applicable requirements). that is under common control with the specified
the requirements of footnote 258 in their 15 See 18 CFR 35.37 (2015). company. For purposes of paragraph (a)(9)of the
market-based rate filings. Many sellers 16 We note that the Commission recently issued Commission’s regulations, owning, controlling or
a NOPR seeking comment on a proposal to require holding with power to vote, less than 10 percent of
each regional transmission organization and the outstanding voting securities of a specified
tkelley on DSK3SPTVN1PROD with PROPOSALS
9 Order No. 697–A, FERC Stats. & Regs. ¶ 31,268
independent system operator to electronically company creates a rebuttable presumption of lack
at n.258. deliver to the Commission data from market of control. 18 CFR 35.36(a)(9) (2015).
10 Market-based rate filings include initial market-
participants that lists market participants’ 18 A seller may have more than one ultimate
based rate applications, notices of change in status ‘‘connected entities,’’ including entities that have affiliate owner. For example, if a seller is owned 50
and triennial updated market power analyses. certain ownership, employment, debt or contractual percent by affiliate A and 50 percent by affiliate B,
11 Order No. 697, FERC Stats. & Regs. ¶ 31,252 at
relationships to the market participant, and there are two ownership ‘‘chains’’ or ‘‘branches.’’
P 895; 18 CFR 35.37(a)(2) (2015). describes the nature of such relationships. See The seller must identify and describe the ultimate
12 Order No. 816, 153 FERC ¶ 61,065 at P 333 (to Collection of Connected Entity Data from Regional affiliate owner at the top of each chain/branch, i.e.,
be codified at 18 CFR 35.37(a)(2) (2015)). Transmission Organizations and Independent the last affiliate owner in that chain/branch.
VerDate Sep<11>2014 17:42 Dec 23, 2015 Jkt 238001 PO 00000 Frm 00014 Fmt 4702 Sfmt 4702 E:\FR\FM\24DEP1.SGM 24DEP1](https://thefederalregister.org/doc/80_FR_80549/page/3.svg)
![80306 Federal Register / Vol. 80, No. 247 / Thursday, December 24, 2015 / Proposed Rules
owns or controls: generation; III. Information Collection Statement Respondents subject to the filing
transmission; intrastate natural gas 18. The Paperwork Reduction Act requirements of a rule will not be
transportation, storage or distribution (PRA) 26 requires each federal agency to penalized for failing to respond to these
facilities; physical coal supply sources seek and obtain Office of Management collection(s) of information unless the
or ownership of or control over who and Budget (OMB) approval before collection(s) of information display a
may access transportation of coal undertaking a collection of information valid OMB control number.
supplies.24 We remind sellers that the directed to ten or more persons or 19. The Commission is submitting the
provisions in section 35.42(a)(1) apply contained in a rule of general proposed modifications to its
to the seller and its affiliates because the applicability. OMB’s regulations,27 in information collection to OMB for
Commission considers affiliates’ assets turn, require approval of certain review and approval in accordance with
when assessing a seller’s horizontal and information collection requirements section 3507(d) of the Paperwork
vertical market power.25 imposed by agency rules. Upon Reduction Act of 1995.
approval of a collection(s) of 20. The following table provides the
information, OMB will assign an OMB estimated burden reduction proposed in
control number and an expiration date. RM16–3: 28
FERC–919, ESTIMATED CHANGES, DUE TO PROPOSED RULE IN RM16–3
Annual Average burden
Number of number of Total number Annual burden hours
Type of requirement hours & cost per
respondents responses per of responses & total annual cost
response 29
respondent
(1) (2) (1) * (2) = (3) (4) (3) * (4) = (5)
Reduction of requirement for sellers to de- 509 1 509 ¥40 hrs.; ¥$3,858 ¥20,360 hrs.;
scribe entire ownership structure in Initial ¥$1,963,722
Applications and Triennial Updated Mar-
ket Power Analyses, & Change of Status
—[Decrease in burden and cost].
Title: FERC–919, Market Based Rates 21. Comments concerning the 23. The Commission has categorically
for Wholesale Sales of Electric Energy, information collection proposed in this excluded certain actions from this
Capacity and Ancillary Services by NOPR and the associated burden requirement as not having a significant
Public Utilities. estimates, should be sent to the effect on the human environment.
Action: Proposed revision to existing Commission in this docket and may also Included in the exclusion are rules that
collection. be sent to the Office of Management and are clarifying, corrective, or procedural,
OMB Control No: 1902–0234. Budget, Office of Information and or that do not substantially change the
Regulatory Affairs [Attention: Desk effect of the regulations being
Respondents: Business or other for amended.31 The actions here fall within
profit, and not for profit institutions. Officer for the Federal Energy
Regulatory Commission]. For security this categorical exclusion in the
Frequency of Responses: As needed. Commission’s regulations.
reasons, comments should be sent by
Necessity of the Information: This email to OMB at the following email V. Regulatory Flexibility Act
NOPR reduces the amount and scope of
address: oira_submission@omb.eop.gov.
ownership information that sellers must 24. The Regulatory Flexibility Act of
Please refer to OMB Control Number
provide in their market-based rate 1980 (RFA) 32 generally requires a
filings. Interested persons may obtain 1902–0234 in your submission to OMB. description and analysis of proposed
information on the reporting IV. Environmental Analysis rules that will have significant
requirements by contacting the Federal economic impact on a substantial
Energy Regulatory Commission, Office 22. The Commission is required to number of small entities. The Small
of the Executive Director, 888 First prepare an Environmental Assessment Business Administration (SBA) revised
Street NE., Washington, DC 20426 or an Environmental Impact Statement its size standard (effective January 22,
[Attention: Ellen Brown, email: for any action that may have a 2014) for electric utilities from a
DataClearance@ferc.gov, phone: (202) significant adverse effect on the human standard based on megawatt hours to a
502–8663, fax: (202) 273–0873]. environment.30 standard based on the number of
24 We note that some of these requirements exist ‘‘whether the seller or its affiliates can erect other 29 The Commission estimates this figure based on
in the current regulation or the regulation as revised barriers to entry.’’) the Bureau of Labor Statistics data (for the Utilities
by Order No. 816. 26 44 U.S.C. 3501–3520. sector, at http://www.bls.gov/oes/current/naics2_
25 See Order No. 697, FERC Stats. & Regs. 27 5 CFR 1320 (2015).
22.htm, plus benefits information at http://www.bls.
gov/news.release/ecec.nr0.htm). The average hourly
¶ 31,252 at P 1017 (‘‘the Commission’s change in 28 In Order No. 697–A, the Commission required
cost (salary plus benefits) of $96.45 is based on the
status requirements are intended to track the
tkelley on DSK3SPTVN1PROD with PROPOSALS
that sellers seeking to obtain or retain market-based following occupational categories:
requirements embedded in the horizontal and rate authority identify all upstream owners and • Lawyer (Code 23–0000), $129.87/hour.
vertical analysis as well as the affiliate abuse affiliates. Order No. 697–A, FERC Stats. & Regs. • Management Analyst (Code 13–1111), $63.03/
representations.’’). See also id. P 3 n.2 (major ¶ 31,268 at P 181 n.258. The Commission most hour.
aspects of the Commission’s market-based rate recently updated the burden estimates associated 30 Regulations Implementing the National
regulatory regime include ‘‘whether a market-based with the market-based rate program in Order No. Environmental Policy Act of 1969, Order No. 486,
rate seller or any of its affiliates has market power 816, which will become effective on January 28, FERC Stats. & Regs. ¶ 30,783 (1987).
in generation or transmission and, if so, whether 2016. The PRA package and burden estimates for 31 18 CFR 380.4(a)(2)(ii) (2015).
such market power has been mitigated’’ and the Order No. 816 are pending OMB review. 32 5 U.S.C. 601–612 (2012).
VerDate Sep<11>2014 17:42 Dec 23, 2015 Jkt 238001 PO 00000 Frm 00016 Fmt 4702 Sfmt 4702 E:\FR\FM\24DEP1.SGM 24DEP1](https://thefederalregister.org/doc/80_FR_80549/page/5.svg)
![Federal Register / Vol. 80, No. 247 / Thursday, December 24, 2015 / Proposed Rules 80307
employees including affiliates.33 This VII. Document Availability affiliate owners that have a franchised
NOPR, if adopted, reduces (for small 29. In addition to publishing the full service area or market-based rate
and large entities) the burden and text of this document in the Federal authority, and all affiliate owners that
expense associated with filing market- Register, the Commission provides all directly own or control: Generation;
based rate applications and triennial interested persons an opportunity to transmission; intrastate natural gas
market power updates by clarifying the view and/or print the contents of this transportation, storage or distribution
current regulations and by requiring document via the Internet through the facilities; physical coal supply sources
identification of only the ultimate Commission’s Home Page (http:// or ownership of or control over who
affiliate owner(s) and affiliate owners www.ferc.gov) and in the Commission’s may access transportation of coal
that directly own or control generation, Public Reference Room during normal supplies. The term ‘‘affiliate owner’’
transmission, or inputs to electric power business hours (8:30 a.m. to 5:00 p.m. means any owner of the Seller that is an
production, have a franchised service Eastern time) at 888 First Street NE., affiliate of the Seller as defined in
area, or have market-based rate Room 2A, Washington, DC 20426. § 35.36(a)(9) of this chapter. The Seller
authority, rather than the 30. From the Commission’s Home must also provide an appendix of assets
comprehensive ownership information Page on the Internet, this information is in the form provided in Appendix B of
currently required. In addition, the available on eLibrary. The full text of this subpart and an organizational chart.
Commission clarifies and limits the this document is available on eLibrary The organizational chart must depict the
types of ownership changes that must be in PDF and Microsoft Word format for Seller’s current corporate structure
reported to the Commission via a notice viewing, printing, and/or downloading. indicating all affiliates.
of change in status. Accordingly, the To access this document in eLibrary, * * * * *
Commission certifies that this NOPR, if type the docket number excluding the ■ 3. Amend § 35.42 by revising
adopted, will not have a significant last three digits of this document in the paragraph (a)(2)(iv) and adding
economic impact on a substantial docket number field. paragraph (a)(2)(v) to read as follows:
number of small entities. An analysis 31. User assistance is available for
under the RFA is not required. § 35.42 Change in status reporting
eLibrary and the Commission’s Web site requirement.
VI. Comment Procedures during normal business hours from the
(a) * * *
Commission’s Online Support at 202–
25. The Commission invites interested (2) * * *
502–6652 (toll free at 1–866–208–3676)
persons to submit comments on the (iv) Has a franchised service area; or
or email at ferconlinesupport@ferc.gov,
matters and issues proposed in this (v) Is an ultimate affiliate owner,
or the Public Reference Room at (202)
notice to be adopted, including any defined as the furthest upstream
502–8371, TTY (202) 502–8659. Email
related matters or alternative proposals affiliate(s) in the ownership chain.
the Public Reference Room at
that commenters may wish to discuss. public.referenceroom@ferc.gov. * * * * *
Comments are due February 22, 2016. [FR Doc. 2015–32273 Filed 12–23–15; 8:45 am]
Comments must refer to Docket No. List of Subjects in 18 CFR Part 35
BILLING CODE 6717–01–P
RM16–3–000, and must include the Electric power rates; Electric utilities;
commenter’s name, the organization Reporting and record-keeping
they represent, if applicable, and their requirements.
address in their comments. DEPARTMENT OF LABOR
By direction of the Commission.
26. The Commission encourages 29 CFR Parts 29 and 30
comments to be filed electronically via Issued: December 17, 2015.
the eFiling link on the Commission’s Nathaniel J. Davis, Sr., RIN 1205–AB59
Web site at http://www.ferc.gov. The Deputy Secretary.
Commission accepts most standard Apprenticeship Programs; Equal
In consideration of the foregoing, the
word processing formats. Documents Employment Opportunity; Extension of
Commission proposes to amend Chapter
created electronically using word Comment Period
I, Title 18, Code of Federal Regulations,
processing software should be filed in to read as follows: AGENCY: Employment and Training
native applications or print-to-PDF Administration, Labor.
format and not in a scanned format. PART 35—FILING OF RATE
ACTION: Proposed rule; extension of
Commenters filing electronically do not SCHEDULES AND TARIFFS
comment period.
need to make a paper filing.
27. Commenters that are not able to ■ 1. The authority citation for Part 35 SUMMARY: The Department of Labor
file comments electronically must send continues to read as follows: (Department) issued a proposed rule in
an original of their comments to: Authority: 16 U.S.C. 791a–825r; 2601– the Federal Register of November 6,
Federal Energy Regulatory Commission, 2645; 31 U.S.C. 9701; 42 U.S.C. 7101–7352. 2015 [80 FR 68907], concerning
Secretary of the Commission, 888 First ■ 2. Amend § 35.37 by revising proposed updates to the equal
Street NE., Washington, DC 20426. paragraph (a)(2) to read as follows: opportunity regulations that implement
28. All comments will be placed in the National Apprenticeship Act of
the Commission’s public files and may § 35.37 Market power analysis required. 1937. This document extends the
be viewed, printed, or downloaded (a)(1) * * * comment period an additional 15 days,
tkelley on DSK3SPTVN1PROD with PROPOSALS
remotely as described in the Document (2) When submitting a market power from January 5, 2016, to January 20,
Availability section below. Commenters analysis, whether as part of an initial 2016. The Department received a
on this proposal are not required to application or an update, a Seller must request for additional time to develop
serve copies of their comments on other include a description of its ownership comments on the proposed rulemaking.
commenters. structure that identifies all ultimate The Department is therefore extending
affiliate owner(s), i.e., the furthest the comment period in order to give all
33 SBA Final Rule on ‘‘Small Business Size upstream affiliate(s) in the ownership interested persons the opportunity to
Standards: Utilities,’’ 78 FR 77,343 (Dec. 23, 2013). chain. A Seller must also identify all comment fully.
VerDate Sep<11>2014 17:42 Dec 23, 2015 Jkt 238001 PO 00000 Frm 00017 Fmt 4702 Sfmt 4702 E:\FR\FM\24DEP1.SGM 24DEP1](https://thefederalregister.org/doc/80_FR_80549/page/6.svg)
Document Created: 2015-12-24 02:25:49
Document Modified: 2015-12-24 02:25:49
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Proposed Rules | |
| Action | Notice of proposed rulemaking. | |
| Dates | Comments are due February 22, 2016. | |
| Contact | Ashley Dougherty (Technical Information), Office of Energy Market Regulation, Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, (202) 502-8851, [email protected] Laura Chipkin (Legal Information), Office of General Counsel, Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, (202) 502-8615, [email protected] | |
| FR Citation | 80 FR 80302 |
2024 Federal Register | Disclaimer | Privacy Policy
USC | CFR | eCFR