USC Chapter 59

USC Chapter 59
in effect

15 U.S.C. § 3201 Purposes; coverage

(a) PurposesThe purposes of this chapter are to encourage—(1) conservation of energy supplied by gas utilities; (2) the optimization of the efficiency of use of facilities and resources by gas utility systems; and (3) equitable rates to gas consumers of natural gas. (b) Volume of total retail salesThis chapter applies to each gas utility in any calendar year, and to each proceeding relating to each gas utility in such year, if the total sales of natural gas by such utility for purposes other than resale exceeded 10 billion cubic feet during any calendar year beginning after December 31, 1975, and before the immediately preceding calendar year. (c) Exclusion of wholesale salesThe requirements of this chapter do not apply to the operations of a gas utility, or to proceedings respecting such operations, to the extent that such operations or proceedings relate to sales of natural gas for purposes of resale. (d) List of covered utilitiesBefore the beginning of each calendar year, the Secretary shall publish a list identifying each gas utility to which this chapter applies during such calendar year. Promptly after publication of such list, each State regulatory authority shall notify the Secretary of each gas utility on the list for which such State regulatory authority has ratemaking authority.

15 U.S.C. § 3202 Definitions

For purposes of this chapter— (1) The term “gas consumer” means any person, State agency, or Federal agency, to which natural gas is sold other than for purposes of resale. (2) The term “gas utility” means any person, State agency, or Federal agency, engaged in the local distribution of natural gas, and the sale of natural gas to any ultimate consumer of natural gas. (3) The term “State regulated gas utility” means any gas utility with respect to which a State regulatory authority has ratemaking authority. (4) The term “nonregulated gas utility” means any gas utility other than a State regulated gas utility. (5) The term “rate” means any (A) price, rate, charge, or classification made, demanded, observed, or received with respect to sale of natural gas to a gas consumer, (B) any rule, regulation, or practice respecting any such rate, charge, or classification, and (C) any contract pertaining to the sale of natural gas to a gas consumer. (6) The term “ratemaking authority” means authority to fix, modify, approve, or disapprove rates. (7) The term “sale” when used with respect to natural gas, includes an exchange of natural gas. (8) The term “State regulatory authority” means any State agency which has ratemaking authority with respect to the sale of natural gas by any gas utility (other than by such State agency). (9) The term “integrated resource planning” means, in the case of a gas utility, planning by the use of any standard, regulation, practice, or policy to undertake a systematic comparison between demand-side management measures and the supply of gas by a gas utility to minimize life-cycle costs of adequate and reliable utility services to gas consumers. Integrated resource planning shall take into account necessary features for system operation such as diversity, reliability, dispatchability, and other factors of risk and shall treat demand and supply to gas consumers on a consistent and integrated basis. (10) The term “demand-side management” includes energy conservation, energy efficiency, and load management techniques.

15 U.S.C. § 3203 Adoption of certain standards

(a) Adoption of standardsNot later than 2 years after November 9, 1978 (or after October 24, 1992, in the case of standards under paragraphs (3),11 So in original. The comma probably should not appear. and (4) of subsection (b)), each State regulatory authority (with respect to each gas utility for which it has ratemaking authority) and each nonregulated gas utility shall provide public notice and conduct a hearing respecting the standards established by subsection (b), and, on the basis of such hearing, shall—(1) adopt the standard established by subsection (b)(1), if, and to the extent, such authority or nonregulated utility determines that such adoption is appropriate and is consistent with otherwise applicable State law, and (2) adopt the standards established by paragraphs (2), (3) 22 So in original. A comma probably should appear. (4), (5), and (6) of subsection (b), if, and to the extent, such authority or nonregulated utility determines that such adoption is appropriate to carry out the purposes of this chapter, is otherwise appropriate, and is consistent with otherwise applicable State law. For purposes of any determination under paragraphs (1) and (2) and any review of such determination in any court under section 3207 of this title, the purposes of this chapter supplement State law. Nothing in this subsection prohibits any State regulatory authority or non­regulated utility from making any determination that it is not appropriate to implement any such standard, pursuant to its authority under otherwise applicable State law. (b) EstablishmentThe following Federal standards are hereby established:(1) Procedures for termination of natural gas serviceNo gas utility may terminate natural gas service to any gas consumer except pursuant to procedures described in section 3204(a) of this title. (2) AdvertisingNo gas utility may recover from any person other than the shareholders (or other owners) of such utility any direct or indirect expenditure by such utility for promotional or political advertising as defined in section 3204(b) of this title. (3) Integrated resource planningEach gas utility shall employ, in order to provide adequate and reliable service to its gas customers at the lowest system cost. All plans or filings of a State regulated gas utility before a State regulatory authority to meet the requirements of this paragraph shall (A) be updated on a regular basis, (B) provide the opportunity for public participation and comment, (C) provide for methods of validating predicted performance, and (D) contain a requirement that the plan be implemented after approval of the State regulatory authority. Subsection (c) shall not apply to this paragraph to the extent that it could be construed to require the State regulatory authority to extend the record of a State proceeding in submitting reports to the Federal Government. (4) Investments in conservation and demand managementThe rates charged by any State regulated gas utility shall be such that the utility’s prudent investments in, and expenditures for, energy conservation and load shifting programs and for other demand-side management measures which are consistent with the findings and purposes of the Energy Policy Act of 1992 are at least as profitable (taking into account the income lost due to reduced sales resulting from such programs) as prudent investments in, and expenditures for, the acquisition or construction of supplies and facilities. This objective requires that (A) regulators link the utility’s net revenues, at least in part, to the utility’s performance in implementing cost-effective programs promoted by this section; and (B) regulators ensure that, for purposes of recovering fixed costs, including its authorized return, the utility’s performance is not affected by reductions in its retail sales volumes. (5) Energy efficiencyEach natural gas utility shall—(A) integrate energy efficiency resources into the plans and planning processes of the natural gas utility; and (B) adopt policies that establish energy efficiency as a priority resource in the plans and planning processes of the natural gas utility. (6) Rate design modifications to promote energy efficiency investments(A) In generalThe rates allowed to be charged by a natural gas utility shall align utility incentives with the deployment of cost-effective energy efficiency. (B) Policy optionsIn complying with subparagraph (A), each State regulatory authority and each nonregulated utility shall consider—(i) separating fixed-cost revenue recovery from the volume of transportation or sales service provided to the customer; (ii) providing to utilities incentives for the successful management of energy efficiency programs, such as allowing utilities to retain a portion of the cost-reducing benefits accruing from the programs; (iii) promoting the impact on adoption of energy efficiency as 1 of the goals of retail rate design, recognizing that energy efficiency must be balanced with other objectives; and (iv) adopting rate designs that encourage energy efficiency for each customer class. For purposes of applying the provisions of this chapter 33 See Codification note below. to this paragraph, any reference in this chapter 3 to November 9, 1978, shall be treated as a reference to December 19, 2007. (c) Procedural requirementsEach State regulatory authority (with respect to each gas utility for which it has ratemaking authority) and each nonregulated gas utility, within the 2-year period specified in subsection (a), shall adopt, pursuant to subsection (a), each of the standards established by subsection (b), or, with respect to any such standard which is not adopted, such authority or nonregulated gas utility shall state in writing that it has determined not to adopt such standard, together with the reasons for such determination. Such statement of reasons shall be available to the public. (d) Small business impactsIf a State regulatory authority implements a standard established by subsection (b)(3) or (4), such authority shall—(1) consider the impact that implementation of such standard would have on small businesses engaged in the design, sale, supply, installation, or servicing of energy conservation, energy efficiency, or other demand-side management measures, and (2) implement such standard so as to assure that utility actions would not provide such utilities with unfair competitive advantages over such small businesses.

15 U.S.C. § 3204 Special rules for standards

(a) Procedures for termination of gas serviceThe procedures for termination of service referred to in section 3203(b)(1) of this title are procedures prescribed by the State regulatory authority (with respect to gas utilities for which it has ratemaking authority) or the nonregulated gas utility which provide that—(1) no gas service to a gas consumer may be terminated unless reasonable prior notice (including notice of rights and remedies) is given to such consumer and such consumer has a reasonable opportunity to dispute the reasons for such termination, and (2) during any period when termination of service to a gas consumer would be especially dangerous to health, as determined by the State regulatory authority (with respect to each gas utility for which it has ratemaking authority) or nonregulated gas utility, and such consumer establishes that—(A) he is unable to pay for such service in accordance with the requirements of the utility’s billing, or (B) he is able to pay for such service but only in installments, such service may not be terminated. Such procedures shall take into account the need to include reasonable provisions for elderly and handicapped consumers. (b) Advertising(1) For purposes of this section and section 3203 of this title—(A) The term “advertising” means the commercial use, by a gas utility, of any media, including newspaper, printed matter, radio, and television, in order to transmit a message to a substantial number of members of the public or to such utility’s gas consumers. (B) The term “political advertising” means any advertising for the purpose of influencing public opinion with respect to legislative, administrative, or electoral matters, or with respect to any controversial issue of public importance. (C) The term “promotional advertising” means any advertising for the purpose of encouraging any person to select or use the service or additional service of a gas utility or the selection or installation of any appliance or equipment designed to use such utility’s service. (2) For purposes of this section and section 3203 of this title, the terms “political advertising” and “promotional advertising” do not include—(A) advertising which informs natural gas consumers how they can conserve natural gas or can reduce peak demand for natural gas, (B) advertising required by law or regulation, including advertising required under part 1 of title II of the National Energy Conservation Policy Act [42 U.S.C. 8211 et seq.], (C) advertising regarding service interruptions, safety measures, or emergency conditions, (D) advertising concerning employment opportunities with such utility, (E) advertising which promotes the use of energy efficient appliances, equipment or services, or (F) any explanation or justification of existing or proposed rate schedules, or notification of hearings thereon.

15 U.S.C. § 3205 Federal participation

(a) InterventionIn addition to the authorities vested in the Secretary pursuant to any other provision of law, the Secretary, on his own motion, may intervene as a matter of right in any proceeding before a State regulatory authority which relates to gas utility rates or rate design. Such intervention shall be solely for the purpose of advocating policies or methods which carry out the purposes set forth in section 3201 of this title. (b) RightsThe Secretary shall have the same rights as any other party to a proceeding before a State regulatory authority which relates to gas utility rates or rate design. (c) Nonregulated gas utilitiesThe Secretary, on his own motion, may, to the same extent as provided in subsections (a) through (b), intervene as a matter of right in any proceeding which relates to rates or rate design of nonregulated gas utilities.

15 U.S.C. § 3206 Gas utility rate design proposals

(a) Study(1) The Secretary, in consultation with the Commission and, after affording an opportunity for consultation and comment by representatives of the State regulatory commissions, gas utilities, and gas consumers, shall study and report to Congress on gas utility rate design within 18 months after November 9, 1978. Such study shall address the effect (both separately and in combination) of the following factors upon the items listed in paragraph (2): incremental pricing; marginal cost pricing; end user gas consumption taxes; wellhead natural gas pricing policies; demand-commodity rate design; declining block rates; interruptible service; seasonal rate differentials; and end user rate schedules. (2) The items referred to in paragraph (1) are as follows:(A) natural gas pipeline and local distribution company load factors; (B) rates to each class of user, including residential, commercial, and industrial users; (C) the change in total costs resulting from gas utility designs (including capital and operating costs) to gas consumers or classes thereof; (D) demand for, and consumption of, natural gas; (E) end use profiles of natural gas pipelines and local distribution companies; and (F) competition with alternative fuels. (b) ProposalsBased upon the study prepared pursuant to subsection (a), the Secretary shall develop proposals to improve gas utility rate design and to encourage conservation of natural gas. Such proposals shall include any comments and recommendations of the Commission. (c) Transmission to CongressThe proposals prepared under subsection (b), shall be transmitted, together with any legislative recommendations, to each House of Congress not later than 6 months after the date of submission of the study under subsection (a). Such proposals shall be accompanied by an analyses 11 So in original. Probably should be “analysis”. of—(1) the projected savings (if any) in consumption of natural gas, and other energy resources, (2) changes (if any) in the cost of natural gas to consumers, which are likely to result from the implementation nationally of each of such proposals, and (3) the effects of the proposals on other provisions of this Act on gas utility rate structures. (d) Public participationThe Secretary shall provide for public participation in the conduct of the study under subsection (a), and the preparation of proposals under subsection (b).

15 U.S.C. § 3207 Judicial review and enforcement

(a) Limitation of Federal jurisdiction(1) Notwithstanding any other provision of law, no court of the United States shall have jurisdiction over any action arising under any provision of this chapter except for—(A) an action over which a court of the United States has jurisdiction under paragraph (2), or (B) review in the Supreme Court of the United States in accordance with sections 1257 and 1258 of title 28. (2) The Secretary may bring an action in any appropriate court of the United States to enforce his right to intervene under section 3205 of this title, and such court shall have jurisdiction to grant appropriate relief. (b) Enforcement(1) Any person may bring an action to enforce the requirements of this chapter in the appropriate State court. Such action in a State court shall be pursuant to applicable State procedures. (2) Nothing in this chapter shall authorize the Secretary to appeal or otherwise seek judicial review of the decisions of a State regulatory authority or nonregulated gas utility or to become a party to any action to obtain such review or appeal. The Secretary may participate as an amicus curiae in any judicial review of an action arising under the provisions of this chapter.

15 U.S.C. § 3208 Relationship to other applicable law

Nothing in this chapter prohibits any State regulatory authority or nonregulated gas utility from adopting, pursuant to State law, any standard or rule affecting gas utilities which is different from any standard established by this chapter.

15 U.S.C. § 3209 Reports respecting standards

(a) State authorities and nonregulated utilitiesNot later than 1 year after November 9, 1978, and annually thereafter for 10 years, each State regulatory authority (with respect to each gas utility for which it has ratemaking authority), and each nonregulated gas utility, shall report to the Secretary, in such manner as the Secretary shall prescribe, respecting its consideration of the standards established by this chapter. Such report shall include a summary of the determinations made and actions taken with respect to each of such standards on a utility-by-utility basis. (b) SecretaryNot later than 18 months after November 9, 1978, and annually thereafter for 10 years, the Secretary shall submit a report to the President and the Congress containing—(1) a summary of the reports submitted under subsection (a), (2) his analysis of such reports, and (3) his actions under this chapter, and his recommendations for such further Federal actions, including any legislation, regarding retail gas utility rates (and other practices) as may be necessary to carry out the purposes of this chapter.

15 U.S.C. § 3210 Prior and pending proceedings

For purposes of this chapter, proceedings commenced by any State regulatory authority (with respect to gas utilities for which it has ratemaking authority) and any nonregulated gas utility before November 9, 1978, and actions taken before such date in such proceedings shall be treated as complying with the requirements of this chapter if such proceedings and actions substantially conform to such requirements. For purposes of this chapter, any such proceeding or action commenced before November 9, 1978, but not completed before such date shall comply with the requirements of this chapter, to the maximum extent practicable, with respect to so much of such proceeding or action as takes place after such date.

15 U.S.C. § 3211 Relationship to other authority

Nothing in this chapter shall be construed to limit or affect any authority of the Secretary or the Commission under any other provision of law.

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