FERC has unveiled its long-awaited final rule on expeditedcomplaint procedures, the focus of which is a “very innovative”fast-track process for resolving “highly time-sensitive” industrydisputes within 20 days after a response is filed. This compares toFERC’s target of up to 60 days for most standard complaints. TheCommission voted out the order notationally after its bi-weeklymeeting last Wednesday.

The fast-track procedures aren’t meant to replace the standardprocedures for resolving complaints at the Commission, but ratherare intended to complement them, according to FERC. To be eligiblefor the fast track, a complainant must make “a highly credibleclaim and a persuasive showing that the standard complaint processwill not provide meaningful relief,” Commissioner William Masseysaid [RM98-13].

If such a showing is made, the Commission will shorten thetimeframe for a party to respond to the complaint to a few days andwill issue a procedural order (on how it intends to process thecomplaint) “if necessary within two to three days after [an]answer” to the complaint is submitted, he noted. And it will seekto rule on the merits of a dispute within 20 days from the date ofthe answer to the complaint. “I would have preferred that we makethe fast track even faster by delegating to staff certain processdecisions, but the majority did not agree.” Still, Massey said hebelieves the changes will make the complaint process “more userfriendly,” giving parties a quicker turnaround on their disputes.

The Commission noted the fast-track process will be used in”only limited circumstances” due to the “extraordinarily compressedtime schedule” that will be required. It encouraged potentialcomplainants to seek fast-track processing “sparingly and only inthe most unusual cases that demand accelerated treatment.” Anexample of a case that would merit such quick processing would beone where a shipper alleges that it has been denied access to apipeline under the Natural Gas Act, according to FERC. In such acase, the complainant would be required to provide a “satisfactoryexplanation” as to whether alternative dispute resolution (ADR) waspursued prior to filing the complaint. It further said that aruling on a request for preliminary relief – such as a stay – wouldbe “almost immediate” in such cases. But it noted that a requestfor such relief also could be made in a standard complaint.

The final rule did set target timeframes for the Commission toresolve complaints more expeditiously, but it stopped short ofimposing specific, strict deadlines for such action. The latter wassupported by the Pipeline Coalition Group, which includedproducers, LDCs and others. FERC believes that having targettimeframes, rather than strict deadlines, will give it “theflexibility to adjust when necessary complicated issues andunforeseen circumstances.”

The rule appears to be a composite of the proposals of gasproducers, pipelines and LDCs, as well as electric utilities. Thenew, expedited complaint process will apply to all FERC-regulatedindustries – gas, electric, hydro and oil.

In addition to the fast-track process, the final rule codifiesFERC’s current Enforcement Hotline procedures, brings its currentADR rules into conformance with the Administrative DisputeResolution Act of 1996, offers ADR as one of the available pathsfor handling complaints, requires responses to standard complaints(not eligible for fast track) to be filed in 20 days, specifies indetail the information that must be included in complaints, andestablishes a simplified procedure for resolving complaints thatinvolve less than $100,000 and have minimal impact on othercustomers. Under the final rule, complaints would have to satisfy10 informational requirements before being accepted at FERC,Commissioner Linda Breathitt said. Also, FERC will not acceptanswers to complaints that “simply admit or deny wrongdoing,” shenoted, but rather will require full documentation.

“We’re much clearer than we ever have been about what thecriteria are for accepting [a] complaint, [and] how quicklyresponses need to be filed. We make available various modes ofresolution, including an innovative fasttrack process…There are alot of new approaches in here – the use of ADR, real-timeCommission decisions, expeditious hearing orders, [and] interimrelief,” said Chairman James Hoecker.

He noted FERC codified its Enforcement Hotline, which has beenaround for a decade, to advertise its availability. “We want tomake sure that people know that it’s there, so we put it in theregs.”The Commission also set up an E-mail address for theHotline – hotline@ferc.fed.us – to encourage its use in disputeresolution. This is in addition to the phone number: (877)303-4340. “We’re plugged in and ready to roll,” Hoecker said,adding the Hotline has been an effective alternative to filingformal complaints.

Both producers and pipelines reacted positively to the finalcomplaint rule. Producers especially favored the fast-trackprocedures, codifying the Hotline, and the Commission’s concept ofproviding interim relief to complainants, said Philip Budzik of theNatural Gas Supply Association.

“It’s really encouraging” that the Commission has issued a finalrule because “a lot of other things depend on an expeditedcomplaint process,” such as negotiated terms and conditions, saidLorraine Cross, senior vice president of the Interstate Natural GasAssociation of America (INGAA). More specifically, she wasencouraged the Commission codified its Hotline procedures – aposition that the pipelines supported. As for the fast-trackprocess, she said she “wasn’t opposed to the concept,” butacknowledged “I don’t know how it works” yet. The use of ADR tosettle complaints sounded like a voluntary option for companies,Cross said, adding “why not give it a shot?”

Susan Parker

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