APGA Regulatory and Legislative Weekly Report - November 18, 2016

11-18-2016 15:44

Recent DOE Procedural Rule May Doom Any Pending Efficiency Rulemakings
As a result of litigation with appliance manufacturers over substantive technical errors that arose in
a rulemaking under the Energy Policy and Conservation Act, DOE added a new review period for efficiency
rules in late September that may now mean that no more efficiency rules will issue from the Obama
Administration. The new regulation establishes a 45‐day review period after a final rule is completed and
published on the DOE website for parties to review and note any technical errors –a typo, a number error, a
bad formula, but not “disagreement with a policy choice that the Secretary has made.” Until the expiration
of that period, the rule cannot be posted in the Federal Register, which is the action that makes regulations
final and effective. If the Trump Administration freezes all new rules on Inauguration Day, which is likely,
then final publication in the Federal Register will not happen until the then Secretary of DOE approves the
rule. This will apply to any rule finalized after December 6th. The agency would have to rush pending rules
through to avoid this potential limbo. Yet, even if rules are issued quickly and avoid this trap, Congress will
have the opportunity to review and stop any rule issued in these last days of the Obama Administration
under the Congressional Review Act by issuing a joint resolution and having President Trump agree. Any
final furnace rule issued in the Obama Administration would face these hurdles.
Meanwhile, the House of Representatives passed this week the Midnight Rules Relief Act of 2016,
which would allow Congress to review and reject rules en bloc passed within the last 60 legislative days of a
president’s term, beyond the normal congressional rule review powers of the Congressional Review Act. The
Senate has yet to address such a measure, and the White House issued a veto threat, saying that the review
powers would create additional uncertainty in a variety of industries and undermine the work of a variety of

Natural Gas Conservation Plan?
Due to the failure of its Aliso Canyon underground storage field, Southern California Gas plans to
encourage gas conservation this winter. Its state regulator has approved several voluntary demand
response programs for residential and larger customer usages reductions when supplies are tight, as well as
for power generators to reduce their usage on high stress days. The utility plans to broaden its gas
conservation pilot rebate program, lifting the $35 per customer cap and allowing additional customers to
participate. SoCal Gas will spend up to $800,000 on studying how effective the programs were at reducing
gas use.

DOT Seeks Comment on Underground Natural Gas Storage Facility Safety Account
The Pipeline and Hazardous Materials Safety Administration (PHMSA) has requested comments on a
proposed fee rate structure designed to fund an $8 million Underground Natural Gas Storage Facility Safety
Account. Under the Protecting our Infrastructure of Pipelines and Enhancing Safety Act of 2016 (PIPES Act),
PHMSA is to impose user fees specific to underground gas storage facilities. The proposal is for a tiered fee
structure that would require larger payments from larger operators, similar to the fee rate structure for
Liquefied Natural Gas plants. There are currently 411 underground natural gas storage sites in the U.S., with
more than four trillion cubic feet of working gas capacity.

Former FERC Commissioner Tony Clark Lands at DC Law Firm
Tony Clark is set to join Wilkinson Barker Knauer at the beginning of 2017 as a senior adviser, mostly
working out of the firm’s Washington, D.C., office, but also spending time in its Denver office. Clark will join
the firm after serving at FERC for four years, an agency he stepped down from in September after his term
expired in June. Before FERC, Clark served on the North Dakota Public Service Commission.

FERC Office of Enforcement Issues 10th Annual Report on Enforcement
Marking a decade, FERC’s Enforcement Report for 2016 notes that investigations staff opened 17
new investigations while closing 11 pending investigations either with no action or through a Commissionapproved
settlement. Staff negotiated settlements for almost $12.25 million in civil penalties and
disgorgement of nearly $5.7 million in unjust profits. Since 2007, the total payable, non‐pending civil
penalties assessed by the Commission amounts to approximately $641 million, and the total disgorgements
amount to slightly over $401 million. Further, the analytics and surveillance staff worked on more than 40
investigations and reviewed numerous instances of potential misconduct, with some reviews resulting in
referrals to Investigations.

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