[Federal Register Volume 77, Number 188 (Thursday, September 27, 2012)]
[Proposed Rules]
[Pages 59348-59354]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-23807]
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DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
18 CFR Part 357
[Docket No. RM12-18-000]
Revisions to Page 700 of FERC Form No. 6
AGENCY: Federal Energy Regulatory Commission, DOE.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Federal Energy Regulatory Commission (Commission) proposes
to modify Page 700 of FERC Form No. 6 (Form 6) to facilitate the
calculation of a pipeline's actual return on equity. The Commission
proposes to expand the information provided regarding rate base (line
5), rate of return (line 6), return on rate base (line 7), and income
tax allowance (line 8).
DATES: Comments are due November 26, 2012.
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:
James Sarikas (Technical Information), Office of Energy Market
Regulation, 888 First Street NE., Washington, DC 20426, (202) 502-6831,
James.Sarikas@ferc.gov.
Brian Holmes (Technical Information), Office of Enforcement, 888 First
Street NE., Washington, DC 20426, (202) 502-6008,
Brian.Holmes@ferc.gov.
Andrew Knudsen (Legal Information), Office of the General Counsel, 888
First Street NE., Washington, DC 20426, (202) 502-6527,
Andrew.Knudsen@ferc.gov.
SUPPLEMENTARY INFORMATION:
Table of Contents
Paragraph
Nos.
I. Background............................................... 2
II. Discussion.............................................. 6
A. Rate Base............................................ 9
B. Rate of Return....................................... 11
C. Composite Tax Return................................. 13
III. Information Collection Statement....................... 19
IV. Environmental Analysis.................................. 25
V. Regulatory Flexibility Act [Analysis or Certification]... 26
VI. Comment Procedures...................................... 27
VII. Document Availability.................................. 31
(Issued September 20, 2012)
1. The Federal Energy Regulatory Commission (Commission) proposes
to modify the reporting requirements on Page 700, Annual Cost of
Service Based Analysis Schedule, of FERC Form No. 6, Annual Report of
Oil Pipeline Companies (Form 6), to facilitate the calculation of a
pipeline's actual rate of return on equity based upon Page 700 data.
The modifications to Page 700 include requiring additional information
regarding rate base, rate of return, return on rate base, and income
taxes.\1\
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\1\ Concurrent with the issuance of this NOPR, the Commission is
issuing a final rule in Docket No. RM11-21-000, Revision to Form No.
6.
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[[Page 59349]]
I. Background
2. The Commission is responsible for regulating the rates, terms
and conditions that oil pipelines charge for transportation under the
Interstate Commerce Act (ICA).\2\ The ICA prohibits pipelines from
charging rates that are ``unjust and unreasonable'' and permits
shippers and the Commission to challenge both pre-existing and newly
filed rates.\3\
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\2\ 49 U.S.C. 1, et seq.
\3\ 49 U.S.C. 13(1), 15(1), (7). Just and reasonable rate are
``rates yielding sufficient revenue to cover all proper costs,
including federal income taxes, plus a specified return on invested
capital.'' City of Charlottesville v. FERC, 774 F.2d 1205, 1207
(D.C. Cir. 1985).
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3. To assist the Commission in the administration of its
jurisdictional responsibilities, the ICA authorizes the Commission to
prescribe annual or other periodic reports.\4\ Through Form 6, the
Commission collects annual financial information from crude and refined
product pipelines \5\ subject to the Commission's jurisdiction, as
prescribed in section 357.2 of the Commission's regulations.\6\ Form 6
``is intended to be both a financial and ratemaking document.'' \7\
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\4\ 49 App. U.S.C. 1-85 (2000).
\5\ Hereafter, the term ``oil pipeline'' shall include both
crude and refined product pipelines.
\6\ 18 CFR 357.2 (2012).
\7\ Revisions to and Electronic Filing of the FERC Form No. 6
and Related Uniform Systems of Accounts, Order No. 620, FERC Stats.
& Regs., Regulation Preambles July 1996-December 2000 ] 31,115, at
p. 31,954 (2000) (citing Cost of Service Requirements and Filing
Requirements for Oil Pipelines, Order No. 571, FERC Stats. & Regs.,
Regulation Preambles Jan. 1991-June 1996 ] 31,006, at p. 31,169
(1995) and Form 6, p. I, Roman Numeral 1; on reh'g, Order No. 620-A,
94 FERC 61,130 (2001); order on reh'g, Order No. 620-A, 94 FERC ]
61,130 (2001)).
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4. Page 700 of Form 6 provides a simplified presentation of an oil
pipeline's jurisdictional cost-of-service. Page 700 serves as a
preliminary screening tool to evaluate pipeline rates.\8\ However,
``Page 700 information alone is not intended to show what a just and
reasonable rate should be.'' \9\ Currently, pipelines are required to
provide the following on Page 700: Operating and Maintenance Expenses
(line 1), Depreciation Expense (line 2), AFUDC Depreciation (line 3),
Amortization of Deferred Earnings (line 4), Rate Base (line 5), Rate of
Return (line 6), Return on Rate Base (line 7), Income Tax Allowance
(line 8), Total Cost of Service (line 9), Total Interstate Operating
Revenues (line 10), Throughput in Barrels (line 11), and Throughput in
Barrel-Miles (line 12).
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\8\ All jurisdictional pipelines are required to file page 700,
including pipelines exempt from filing the full Form 6. 18 CFR
357.2(a)(2) and (a)(3) (2012).
\9\ Order No. 571-A, 69 FERC ] 61,411, at p. 31,254 (1994).
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II. Discussion
5. The Commission proposes to modify Page 700 to more easily enable
the calculation of a pipeline's actual rate of return on equity
consistent with the ratemaking principles embodied in Opinion 154-B, et
al. The actual rate of return on equity reflects the relationship
between a pipeline's revenues and its cost of service. As a result, the
actual rate of return on equity is particularly useful information when
using Page 700 to evaluate whether a pipeline's rates are just and
reasonable consistent with the Commission's mandate under the ICA.
6. To provide the data necessary to calculate the actual return on
equity, Page 700 must be modified to include additional information
related to rate base, rate of return, return on rate base, and income
tax rates.
A. Rate Base
7. The Commission seeks to enhance the information provided on Page
700 related to rate base, rate of return, and return on rate base. The
components of an oil pipeline's rate base are governed by the Trended
Original Cost Methodology adopted by the Commission in Opinion No. 154-
B. \10\ Under this methodology, a pipeline's Rate Base consists of (1)
The Original Cost Rate Base, (2) any unamortized amounts from the oil
pipeline's Starting Rate Base Write-Up (SRB),\11\ and (3) Accumulated
Net Deferred Earnings.\12\
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\10\ See Williams Pipeline Co., Opinion No. 154-B, 31 FERC ]
61,377 (1985), order on reh'g, Opinion No. 154-C, 33 FERC ] 61,327
(1985). Instruction No. 2 of Page 700 of the FERC Form No. 6
requiring the values ``be computed consistent with the Commission's
Opinion No. 154-B et al. methodology * * *.''
\11\ The Starting Rate Base Write-Up is a transitional rate base
element employed to bridge the transition from a valuation
ratemaking methodology to the Trended Original Cost methodology as
adopted in Opinion 154-B. The SRB was to be amortized over the
estimated life of the pipeline at the time the SRB was established.
\12\ The trended original cost methodology divides the nominal
return on equity component of the cost of service into real return
and an inflationary return. The real return is collected in the
current year. The Net Deferred Earnings consists of the inflation
component, which is deferred to be recovered in annual installments
over the remaining life of the pipeline. See Opinion No. 154-B, 31
FERC ] 61,377 (1985), order on reh'g, Opinion No. 154-C, 33 FERC ]
61,327 (1985). See, e.g., BP West Coast Prods., LLC v. FERC, 374
F.3d 1263, 1282-83 (D.C. Cir. 2004).
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8. Consistent with Opinion No. 154-B, the Commission proposes to
enhance the Rate Base information provided on line 5 of Page 700 by
adding (1) Rate Base-Original Cost (proposed line 5a), (2) Rate Base-
Unamortized Starting Rate Base Write-Up (proposed line 5b), (3) Rate
Base-Accumulated Net Deferred Earnings (proposed line 5c). The sum of
proposed lines 5a, 5b and 5c comprise the pipeline's Trended Original
Cost Rate Base, which is currently reported on line 5 of Page 700 and
which the Commission proposes to move to line 5d entitled Total Rate
Base-Trended Original Cost-(5a + 5b + 5c).
B. Rate of Return
9. The Commission proposes to require oil pipelines to report the
cost of equity and cost of debt components that constitute the overall
Weighted Cost of Capital currently reported as ``Rate of Return'' on
line 6, Page 700. Specifically, the Commission proposes to include
additional information related to debt and equity capital structure
ratios, i.e. (1) Rate of Return-Adjusted Capital Structure Ratio for
Long Term Debt (proposed line 6a), (2) Rate of Return-Adjusted Capital
Structure Ratio for Proprietary Capital (proposed line 6b).\13\ The
Commission further proposes to add information related to the cost of
debt and the cost of equity, specifically: (1) Rate of Return-Cost of
Long Term Debt Capital (proposed line 6c), (2) Rate of Return-Real Cost
of Proprietary Capital \14\ (proposed line 6d). This additional
information forms the basis for the Rate of Return-Weighted Average
Cost of Capital (the total of 6a * 6c + 6b * 6d), which is now reported
as ``Rate of Return'' on line 6 on Page 700 and which the Commission
proposes to move to line 6e.
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\13\ The Adjusted Capital Structure Ratio adjusts upward the
level of equity in capital structure to account for the treatment of
Accumulated Deferred Earnings under the Opinion 154-B Methodology.
Under the 154-B Methodology, a pipeline's return on the Original
Cost and the SRB Write-Up is based on a weighted average of the cost
of debt and the return on equity. However, a pipeline's rate of
return on Accumulated Net Deferred Earnings is the equivalent to the
rate of return on equity (proposed line 6d) and does not include a
cost of debt component. The upward adjustment to equity ratio allows
the pipeline to apply its weighted average cost of capital
consisting of debt and equity to one rate base. ARCO Pipe Line Co.,
53 FERC ] 61,398 at 62,388-89.
\14\ The real cost of capital excludes the inflationary
component of the nominal return that is placed in Net Deferred
Earnings pursuant to the trended original cost methodology.
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C. Return on Rate Base
10. The Commission proposes to require oil pipelines to report
additional information related to the Return on Rate Base in line 7.
The Return on Rate Base currently reported on line 7 combines the
pipeline's return on equity and the portion of the pipeline's return
allocated to paying its cost of debt. The
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Commission proposes to require the pipeline to include on Page 700 the
Return on Rate Base-Debt Component (proposed line 7a) \15\ and the
Return on Rate Base-Equity Component (proposed line 7b).\16\ The
Commission proposes to report on proposed on line 7c the Total Return
on Rate Base-(7a + 7b), which is the same information currently
reported on line 7.
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\15\ Return on Rate Base-Debt Component will be the equivalent
of the weighted average cost of debt (product of proposed lines 6a
and 6c) multiplied by the Trended Original Cost Rate Base (proposed
line 5d).
\16\ Return on Rate Base-Equity Component will be the equivalent
of the weighted average cost of equity (product of proposed lines 6b
and 6d) multiplied by the Trended Original Cost Rate Base (proposed
line 5d).
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D. Composite Tax Rate
11. The Commission proposes to modify the Page 700 to include the
Composite Tax Rate used to determine the ``Income Tax Allowance.'' \17\
Line 8 of the Page 700 currently requires each pipeline to report the
total dollar amount attributable to the ``Income Tax Allowance'' in its
cost-of-service. The Commission proposes to add a new line 8a which
will require a pipeline to report its ``Composite Tax Rate
Percentage.''
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\17\ The Commission's income tax policy permits ``an income tax
allowance for all entities or individuals owning public utility
assets, provided that entity or individual has an actual or
potential income tax liability to be paid on that income from those
assets.'' Inquiry Regarding Income Tax Allowances, 111 FERC ] 61,139
(2005).
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12. The Commission defines the Composite Tax Rate Percentage as the
sum, adjusted consistent with Commission policy, of (a) the applicable
state income tax rate and (b) a federal income tax rate. As filed on
Page 700, the Composite Tax Rate Percentage should reflect the income
tax rate used pursuant to Commission's policies to determine the Income
Tax Allowance reported on line 8.\18\
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\18\ For instance, the business structure for a large number of
oil pipelines is a Master Limited Partnership (MLP). The income tax
allowance for an MLP pipeline is based upon the tax liability of the
owners.
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13. The Composite Tax Rate Percentage will create a better
understanding of the differential between a pipeline's Total Interstate
Operating Revenues (line 10) and the pipeline's Total Cost of Service
(line 9). Specifically, the Composite Tax Rate Percentage may be used
to determine the portion of this differential that is attributable to
income taxes under Commission policy, and the portion that may be
treated as part of a pipeline's actual return on equity.
E. Calculation of Actual Rate of Return on Equity
14. These modifications to Page 700 will provide information that
may be used to calculate a pipeline's actual rate of return on equity.
The actual rate of return on equity is determined by dividing (a) the
actual return on equity by (b) the equity portion of Trended Original
Cost Rate Base reported on line 5d. The actual return on equity is the
sum of three components that can be derived using the proposed
modifications to Page 700: (a) The return on equity embedded in a
pipeline's Page 700 Total Cost of Service (proposed line 7b); (b) the
difference, adjusted for taxes, between a pipeline's Total Interstate
Operating Revenues (proposed Line 10) and a pipeline's Total Cost of
Service (proposed Line 9); \19\ and (c) the current year's contribution
to Net Deferred Earnings, which is calculated by multiplying the equity
portion of the Trended Original Cost Rate Base (line 5d) by the current
year's Department of Labor's consumer price index for all urban areas
(CPI-U).\20\
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\19\ The difference between the pipeline's Total Interstate
Operating Revenues (Line 10) and Total Cost of Service (proposed
Line 9) provides the pipeline's earnings above its Total Cost of
Service. As described above, the Composite Tax Rate Percentage may
be used to determine the portion of this differential that is
attributable to income taxes under Commission policy and the portion
that may be treated as part of a pipeline's actual return on equity.
\20\ As noted in footnote 16, the trended original cost
methodology divides the nominal return on equity component of the
cost of service into real return and an inflationary return.
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15. Once the actual return on equity has been derived, it may be
divided by the equity portion of Trended Original Cost Rate Base. The
equity portion of the Trended Original Cost Rate base consists of the
Trended Original Cost Rate Base (proposed line 5d) multiplied by the
equity component of capital structure (proposed line 6b).
16. These proposed modifications to Page 700 will increase the
usefulness of Page 700. Prior to this proposal, any attempt to estimate
an oil pipeline's actual return on equity required assumptions
regarding several cost of service components, including capital
structure (proposed lines 6a and 6b), the composite income tax rate
(proposed line 8a), and the return on equity embedded in a pipeline's
Page 700 cost of service (proposed line 7b). The Commission believes
this additional information will make Page 700 a more useful tool for
evaluating a pipeline's rates; however, it welcomes comments as to
whether the proposed changes herein are sufficient for the goals we
have described above.
F. Conclusion
17. As discussed herein, the proposed modifications will facilitate
the calculation of the actual rate of return on equity based upon Page
700 data. The actual rate of return on equity is particularly useful
information when using Page 700 to evaluate a pipeline's rates. The
additional information proposed to be reported will impose almost no
additional burden on oil pipelines because pipelines already must
develop cost of service supporting calculations to determine the Income
Tax Allowance, Rate Base, Rate of Return, and Return on Rate Base
reported on Page 700. Given these existing requirements, the Commission
does not anticipate that these proposed additions to Page 700 of Form 6
will impose a significant burden on oil pipelines.
G. Effective Date
18. The Commission proposes that the changes to Form 6 are to be
effective for reporting in the 2013 Form 6. The 2013 Form 6 must be
filed on or before April 18, 2014.\21\ The new schedule appearing on
Page 700 therefore would not be required for Form 6 filings until April
18, 2014, for the reporting year ending December 31, 2013.
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\21\ 18 CFR 357.1.
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III. Information Collection Statement
19. The Office of Management and Budget (OMB) regulations require
approval of certain information collection requirements imposed by
agency rules.\22\ 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 an agency rule will not be
penalized for failing to respond to these collections of information
unless the collections of information display a valid OMB control
number. The Paperwork Reduction Act (PRA) \23\ requires each federal
agency to seek and obtain OMB approval before undertaking a collection
of information directed to ten or more persons or contained in a rule
of general applicability.\24\
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\22\ 5 CFR 1320.
\23\ 44 U.S.C. 3501-3520.
\24\ OMB's regulations at 5 CFR 1320.3(c)(4)(i) require that
``Any recordkeeping, reporting, or disclosure requirement contained
in a rule of general applicability is deemed to involve ten or more
persons.''
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20. The Commission is submitting these reporting requirements to
OMB for its review and approval under section
[[Page 59351]]
3507(d) of the PRA. Comments are solicited on the Commission's need for
this information, whether the information will have practical utility,
the accuracy of provided burden estimates, ways to enhance the quality,
utility, and clarity of the information to be collected, and any
suggested methods for minimizing the respondent's burden, including the
use of automated information techniques.
21. The Commission's estimate of the additional Public Reporting
Burden and cost related to the proposed rule in Docket RM12-18-000
follow.
22. For the recurring effort involved in filing the data on
proposed lines 5a-5c, 6a-6e, 7a-7c, and 8a of Page 700 for 2013 and
future years, we estimate that the change in burden is 0.5 hours per
year per respondent.
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\25\ Based on an estimated average cost per employee for 2012
(including salary plus benefits) of $143,540, the estimated average
hourly cost per employee is $69.01. The average work year is 2,080
hours.
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Estimated Estimated
Annual number additional Total estimated additional cost Total estimated
RM12-18-000, FERC Form 6 of fliers burden per additional per filer ($) additional cost
filer (Hr) burden (Hr) \25\ ($)
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Filing new proposed lines on page 700.............................. 166 0.5 88 $34.51 $3,036.88
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23. Information Collection Cost and Burden: The Commission seeks
comments on the costs and burden to comply with these requirements.
Title: FERC Form 6, Annual Report of Oil Pipeline Companies.
Action: Proposed Revisions to the FERC Form 6.
OMB Control No: 1902-0022.
Respondents: Oil pipelines.
Frequency of Responses: Annual.
Necessity of the Information: This action ensures the availability
of data consistent with the Commission's obligation to regulate
interstate oil and petroleum product pipeline rates and the intent of
Page 700, to enable the Commission and shippers to monitor and analyze
interstate pipeline costs.
Internal review: The Commission has reviewed the proposed changes
and has determined that the changes are necessary. These requirements
conform to the Commission's need for efficient and sufficient
information collection, communication, and management with regard to
the oil pipeline sector of the energy industry. The Commission has, by
means of internal review, assured itself that there is specific,
objective support for the burden estimates associated with the
information collection requirements.
24. Interested persons may obtain information on the reporting
requirements by contacting: Federal Energy Regulatory Commission, 888
First Street NE., Washington, DC 20426 [Attention: Ellen Brown, Office
of the Executive Director, email: DataClearance@ferc.gov, Phone: (202)
502-8663, fax: (202) 273-0873]. Comments on the requirements of this
rule may also be sent to the Office of Information and Regulatory
Affairs, Office of Management and Budget, Washington, DC 20503
[Attention: Desk Officer for the Federal Energy Regulatory Commission].
For security reasons, comments should be sent by email to OMB at oira_submission@omb.eop.gov. Please reference OMB Control No. 1902-0022,
FERC-6 and the docket number of this proposed rulemaking in your
submission.
IV. Environmental Analysis
25. 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.\26\ The
actions taken here fall within categorical exclusions in the
Commission's regulations for information gathering, analysis, and
dissemination.\27\ Therefore, an environmental assessment is
unnecessary and has not been prepared in this rulemaking.
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\26\ Order No. 486, Regulations Implementing the National
Environmental Policy Act, 52 FR 47897 (Dec. 17, 1987), FERC Stats. &
Regs. ] 30,783 (1987).
\27\ 18 CFR 380.4(a)(5).
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V. Regulatory Flexibility Act
26. The Regulatory Flexibility Act of 1980 (RFA) generally requires
agencies to prepare certain statements, descriptions, and analyses of
proposed rules that will have a significant economic impact on a
substantial number of small business entities.\28\ Agencies are not
required to make such an analysis if a rule would not have such an
effect.
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\28\ 5 U.S.C. 601-12.
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27. The Commission does not believe that this proposed rule will
have an adverse impact on small entities, nor will it impose upon them
any significant costs of compliance. The Commission identified 29 small
entities as respondents to the requirements in the proposed rule.\29\
As explained above, the Commission estimates that the change to Page
700 will increase the paperwork burden of preparing Page 700 by
approximately $34.51 per respondent. The Commission does not estimate
that there are any other regulatory burdens associated with this
proposed rule. Therefore the Commission certifies that the proposed
rule will not have a significant impact on a substantial number of
small entities. Accordingly, no regulatory flexibility analysis is
required.
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\29\ The RFA definition of ``small entity'' refers to the
definition provided in the Small Business Act, which defines a
``small business concern'' as a business that is independently owned
and operated and that is not dominant in its field of operation. 15
U.S.C. 632. The Small Business Size Standards component of the North
American Industry Classification System defines a small oil pipeline
company as one with less than 1,500 employees. See 13 CFR parts 121,
201.
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VI. Comment Procedures
28. 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 60 days from publication in the Federal
Register. Comments must refer to Docket No. RM12-18-000, and must
include the commenter's name, the organization they represent, if
applicable, and their address in their comments.
29. 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.
[[Page 59352]]
30. 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.
31. 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
32. 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 p.m. Eastern time) at 888 First Street NE., Room 2A,
Washington DC 20426.
33. 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.
34. 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
ferconlinesupport@ferc.gov, or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at
public.referenceroom@ferc.gov.
By direction of the Commission.
Kimberly D. Bose,
Secretary.
Appendix A--Summary of Proposed Changes to FERC Form 6, Page 700
Line 5a is added to read as follows:
Rate Base-Original Cost
Line 5b is added to read as follows:
Rate Base-Unamortized Starting Rate Base Write-Up
Line 5c is added to read as follows:
Rate Base-Accumulated Net Deferred Earnings
Line 5d is added to read as follows:
Total Rate Base-Trended Original Cost-(5a + 5b + 5c)
Line 6a is added to read as follows:
Rate of Return-Adjusted Capital Structure Ratio for Long Term Debt
Line 6b is added to read as follows:
Rate of Return-Adjusted Capital Structure Ratio for Proprietary
Capital
Line 6c is added to read as follows:
Rate of Return-Cost of Long Term Debt Capital
Line 6d is added to read as follows:
Rate of Return-Real Cost of Proprietary Capital
Line 6e is added to read as follows:
Rate of Return-Weighted Average Cost of Capital-(6a x 6c + 6b x 6d)
Line 7a is added to read as follows:
Return on Rate Base-Debt Component
Line 7b is added to read as follows:
Return on Rate Base-Equity Component
Line 7c is added to read as follows:
Total Return on Rate Base-(7a + 7b)
Line 8a is added to read as follows:
Composite Tax Rate % (37.50%-37.50)
Note: Appendix B will not be published in the Code of Federal
Regulations
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[FR Doc. 2012-23807 Filed 9-26-12; 8:45 am]
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