C07-0382Decision No. C07-0382
BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF COLORADO
06R-494GDOCKET NO. 06R-494G
IN THE MATTER OF THE PROPOSED RULES regulating GAS Utilities and pipeline operators, 4 Code of colorado regulations 723-4.
order granting exceptions, lifting stay, 
and adopting rules
Mailed Date:    May 11, 2007
Adopted Date: April 25, 2007
TABLE OF CONTENTS
I.	BY THE COMMISSION	1
A.	Statement	1
B.	History	2
C.	Discussion	4
1.	Rule 4108(a).	4
D.	Conclusion	5
II.	ORDER	5

I.	BY THE COMMISSION
A.	Statement
1.	This matter comes before the Commission for consideration of Exceptions to Recommended Decision No. R07-0136 filed by Aquila, Inc. on March 14, 2007.  
2.	
Having been advised in this matter, we grant Aquila’s sole exception to Rule 4108(a), and make several additional changes on our own motion.  We also lift the stay we ordered in Decision No. C07-0189, adopt the rules appended to this decision as Attachment A, and set an effective date for the rules of August 1, 2007.  
B.	History
3.	By Decision No. C06-1066, The Colorado Public Utilities Commission (Commission) issued a Notice of Proposed Rulemaking (NOPR) regarding its Rules Regulating Gas Utilities and Pipeline Operators, 4 Code of Colorado Regulations (CCR) 723-4. The NOPR was published in the Colorado Register on October 10, 2006, and began this proceeding.
4.	By Decision No. C07-0189, issued March 7, 2007, we stayed the Recommended Decision.
5.	The Commission repealed and reenacted its entire body of rules on April 1, 2006.  Due to the complexity of such an undertaking, the need for additional improvements to these rules is necessary.
6.	In its NOPR the Commission stated that the basis and purpose of the proposed amendments was stated in the NOPR to ensure consistency, where possible, among the various sets of Commission rules; centralize common tariff and advice letter provisions in the Rules of Practice and Procedure and make conforming amendments to the substantive gas rules; clarify and supplement customer notice provisions and related definitions; remove the inadvertent exemption of transportation customers from billing rules; recognize the reorganization of the United States Department of Transportation’s Pipeline and Hazardous Materials Safety Administration’s Office of Pipeline Safety (OPS); clarify gas pipeline safety definitions and operator reporting requirements; update gas pipeline safety rules regarding procedural manual requirements; and make various stylistic, formatting, and grammatical changes.
7.	With regard to gas pipeline safety rules, the NOPR indicated the following: In a future rulemaking the Commission will likely adopt recent amendments to 49 C.F.R. Part 192 affecting gas gathering pipeline operators later this year after the next 49 C.F.R. publication date of October 1, 2006, with the understanding that in the event of a conflict between the provisions of 49 C.F.R. Parts 192 and rules 4900 to 4999 regarding the administrative, the enforcement, and the reporting requirements, rules 4900 to 4999 shall apply. Therefore, the definitions in the 4900 series rules were modified to accommodate operators affected by this federal rulemaking.  Changes to Rule 4919 provide an update and clarification to operator’s requirements regarding the final gathering rule published in the Federal Register, Vol. 71, No. 50, March 15, 2006.
8.	The statutory authority for the proposed rules is found in §§ 29-20-108, 40-1-103.5, 40-2-108, 40-2-115, 40-3-102, 40-3-103, 40-3-104.3, 40-3-111, 40-3-114, 40-3-101, 40-4-106, 40-4-108, 40-4-109, 40-5-103, 40-7-117, and 40-8.7-105(5), C.R.S.
9.	Considering the limited scope of the proceeding as set forth in the NOPR and the Commission’s desire to refine the product of the preceding rulemakings, the Commission requested that interested persons limit their comments to the proposed amendments only.  This docket was not to be construed as an opportunity to reopen contentious issues that have already been resolved in preceding rulemakings.
10.	A public hearing was set before an Administrative Law Judge (ALJ) for November 16 and 17, 2006 at 9:00 a.m. in a Commission hearing room in Denver, Colorado.  Comments were filed before the hearing by Duke Energy Field Services (DEFS); Kinder Morgan, Inc., and its wholly owned subsidiary, Rocky Mountain Natural Gas Company (collectively, KMI); and Aquila, Inc. (Aquila). Oral comments were received from Staff of the Colorado Public Utilities Commission (Staff), DEFS, Aquila, and Public Service Company of Colorado (Public Service). Public Service filed written comments prior to the hearing on November 17, 2007. At the conclusion of the hearing the ALJ extended the comment period until December 1, 2006. Aquila filed Supplemental Comments on November 22, 2006.
11.	We grant Aquila’s Exception to proposed Rule 4108(a) and make two modifications on our own motion.
C.	Discussion
12.	We begin with two changes we make on our own motion.  The ALJ adopted rules that contained the Commission’s old address.  We update the rules to reflect the Commission’s new address:  1560 Broadway, Suite 250, Denver, Colorado 80202.
13.	We also make corrections to minor typographical errors in the rules.
1.	Rule 4108(a).
14.	Aquila argues that the Commission should change its language concerning contracts and tariffs in Rule 4108(a).  Reasoning that the definitions of “rate” and “tariff” contained redundancies, the ALJ deleted the terms “tolls,” “rentals,” “charges,” and “contracts” from the definition of “tariff.”  Aquila takes exception, stating that the ALJ's redundancy analysis was not the real issue.  Aquila believes that, even though the ALJ modified the term “contracts” to “forms of contracts,” the term “contract” continues to appear in the definition of “rates,” effectively reincorporating the term “contract.”  Aquila argues that this will have the effect of requiring utilities to file specific, executed contracts (including contracts executed by all customers, suppliers, and vendors); that such a requirement would be contrary to the Commission's historic practices; that there are hundreds of these contracts executed on an annual basis; and that many problems will arise, including internal conflicts in the rules, the necessity of waiver requests to protect specific contracts from public disclosure, and uncertainty of contract approval.  Aquila believes that the definition of “rate” should be modified to delete the word “contract.”  
15.	We agree that the rule should be modified, and we will grant Aquila’s exceptions, with one caveat.  Because the term “contract” is specifically derived from statute (see § 40-3-103, C.R.S.), and because of the Commission’s broad audit power (see § 40-6-106, C.R.S.), our ruling should not be construed to mean that the Commission has no discretion to mandate the filing of specific, executed contracts on a case-by-case basis.  More generally, this decision should not be construed to affect the Commission’s jurisdiction over utility contracts in any fashion.
D.	Conclusion
16.	We grant Aquila’s Exception, and make other modifications to the rules on our own motion, as discussed above.  We lift the stay ordered in Decision No. C07-0189, and set an effective date of August 1, 2007.
II.	ORDER
A.	The Commission Orders That:
1.	The Exception filed by Aquila, Inc. is granted.
2.	The Rules governing Gas Utilities and Pipeline Operators appended as Attachment A to this decision are adopted.
3.	We lift the stay ordered in Decision No. C07-0189.
4.	The rules shall become effective on August 1, 2007.
5.	The 20-day time period provided by § 40-6-114(1), C.R.S. to file an application for rehearing, reargument or reconsideration shall begin on the first day after the effective date of this Order.
6.	The opinion of the Attorney General of the State of Colorado shall be obtained regarding the constitutionality and legality of the rules.
7.	A copy of the rules adopted by the Order shall be filed with the Office of the Secretary of State for publication in The Colorado Register.  The rules shall be submitted to the Office of Legislative Legal Services, for review by the Committee on Legal Services as to whether the adopted rules conform with § 24-4-103, C.R.S.
8.	This Order is effective upon its Mailed Date.
B.	ADOPTED IN COMMISSIONERS’ WEEKLY MEETING
April 25, 2007.

	THE PUBLIC UTILITIES COMMISSION
OF THE STATE OF COLORADO

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Commissioners
	
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