Response Deadlines for Complaints Under Fire
The shorter response times imposed by FERC in its final rule to
expedite resolution of industry disputes will place an inordinate
burden on interstate pipelines and other regulated companies that
are likely to be targets of customer complaints, pipelines and
power utilities contend. Even natural gas producers - the biggest
proponents of a faster complaint process - expressed some concern
about the compressed deadlines.
Major producers, however, generally agreed with the "fundamental
feature[s]" of the final rule, while interstate pipelines
challenged it on substantive grounds. The Interstate Natural Gas
Association of America (INGAA) and individual pipelines argued that
FERC overstepped its authority under the Section 5 complaint
regulations when it said it would act on complainants' requests for
preliminary relief pending a final decision.
The Commission has "blurred the distinctions" between two
different statutory provisions of the Natural Gas Act (NGA), INGAA
said. Section 4 gives it permission to take interim actions, but
"Section 5...contains no such similar grant of authority to issue
preliminary relief prior to completion of a hearing or
corresponding refund protection."
Separately, pipelines and electric utilities were especially
troubled by the 20-day deadline that the Commission allotted for
parties to respond to standard complaints, and the even shorter
response deadline for complaints that are eligible for "fast-track"
processing. "A 20 calendar day response period...does not permit
sufficient time in which to research the facts and issues raised by
a complex complaint and prepare a written response," noted Chevron
Pipe Line, an owner and operator of both natural gas and oil
pipelines. It urged FERC to lengthen the deadline for responses to
30 calendar days from when a complaint is filed at the Commission.
The 20-day response deadline was illustrative of the "disparate
treatment" by FERC of complainants and respondents, said the
Southern Companies, a group of five public utilities. The
complainants, on one hand, are being given "unlimited time [to
prepare] a detailed complaint," while respondents have only 20 days
to "investigate the facts, perform any needed research and prepare
an answer." To even the score, the utilities insist complainants
should be required to file their grievances within 20 days after
the occurrence of the alleged infraction. Parties that fail to meet
this deadline shouldn't be eligible for fast-track processing of
their complaint, they propose.
Chevron further took issue with FERC's requirement that parties
include "all" documents, as well as testimony, in their responses.
"Aside from the question of whether large amounts of data should be
provided with an answer, a respondent may simply not be able to
identify, locate and produce all relevant documents in the time
provided for filing its answer." The requirement also raises
"serious due process issues," the pipeline said.
Indicated Shippers, which include mostly major producers, called
on the Commission to set specific deadlines for interventions and
responses to fast-track complaints. FERC didn't do this in the
final rule but simply said the response deadlines would be shorter
than the 20 calendar days allotted for standard complaints. The
producers cautioned FERC against making "any significant reduction"
to the 20-day timeframe for fast-track cases, saying this would
make things "very tight." Specifically, they said the response
deadline shouldn't be shorter than 10 days.
In addition, producers asked the Commission to promptly issue
notices as to whether complaint cases will receive fast-track
processing. "Ideally, such notice should be provided by the close
of business on the first business day following the filing of the
complaint. In that way, the respondent and intervenors will have
certainty quickly as to 1) whether the Commission will shorten the
answer and intervention deadline; and 2) what the new deadline will
They also called on FERC to eliminate the compressed window of
opportunity - within five days after a complaint is filed - in
which interested parties have to seek confidential materials from
the complainant, and to amend the final rule requiring a
complainant to disclose confidential materials to a non-party in
To eliminate late responses and interventions, which "may bog
complaint proceedings down," the producers proposed that the
Commission - at a minimum - created a centralized listing of all
pending complaint cases to be posted on its web site. In the
alternative, FERC should direct regulated parties involved in
complaint proceedings to post notices of the complaints on their
electronic bulletin boards (EBB) or web sites, they said.
Ideally, the producers would prefer that regulated companies be
required to post full-text copies of their complaints on FERC's web
site, but the Commission deferred action on this in the final rule
until it completes an internal review of its information technology
capabilities under its FERCFirst initiative.
If all else fails, pipelines and other regulated entities could
post similar information on their EBBs or web sites, producers
added. "Posting of pending complaints involving a particular
pipeline, or, at least, a listing of such complaints, on that
pipeline's interactive web page can be implemented by the pipeline
as part of the required web site implementation, at a minimal cost
to the pipeline, and [at] no cost to the Commission."
On a separate issue, The Williams Cos. urged FERC to eliminate
the provision that establishes a simplified procedure for
expeditiously resolving complaints that involve less than $100,000.
It said this was "discriminatory, special treatment for 'small'
Williams argues that the value placed on a claim by a
complainant might not accurately reflect the ultimate impact of the
entire complaint proceeding. "For example, a controversy that is
worth $50,000 to the complainant may be worth millions of dollars
to the respondent after a precedent is set and others avail
themselves of that precedent. Further, issues that involve matters
of policy, even if the amount in controversy is small, must be
given full and adequate consideration."