Last week the Federal Energy Regulatory Commission (“FERC”) issued a final rule allowing interstate natural gas pipelines and electric transmission operators to share non-public operational information to promote the reliability and integrity of their systems. After extensive technical conferences with stakeholders from both the electric and gas industries, Order No. 787 adopts the revisions to Parts 38 and 284 of the Commission’s regulations as stated in the Notice of Proposed Rulemaking without modification.
The new rule provides explicit authority to interstate natural gas pipelines and public utilities that own, operate, or control facilities used for the transmission of electric energy in interstate commerce to voluntarily share non-public, operational information with each other for the purpose of promoting reliable service or operational planning on either the public utility’s or pipeline’s system.
To protect against undue discrimination and ensure that the shared information remains confidential, the rule also adopts a No-Conduit Rule that prohibits recipients of the information from disclosing it to an affiliate or a third party. However, the No-Conduit Rule applies only to the information that an interstate natural gas pipeline or an electric transmission operator exchange pursuant to this final rule. The No-Conduit Rule does not affect current communications among interstate and intrastate natural gas pipelines, local distribution companies and gatherers regarding conditions affecting gas flows between these physically interconnected parties, nor does it affect communications between transmission system operators and load serving entities.
The rule refers to both interstate natural gas pipelines and public utilities that own, operate, or control facilities used for the transmission of electric energy in interstate commerce collectively as “transmission operators.” An electric transmission operator can seek Commission authorization if they wish to share information received from an interstate pipeline with a local distribution company.