pursuant to this section was entered into, certificated under the Natural Gas Act,

except for volumes of gas produced from the Outer Continental Shelf currently transported under certificates authorizing producer reservations and not otherwise currently available to the interstate market, or

(ii) Any intrastate pipeline, local distribution company, or other person (other than an interstate pipeline or a producer of natural gas).

(2) "Eligible electric utility" means an electric utility (or other person who has electric generating capacity), with respect to which the Administrator determines that the use of gas purchased pursuant to this section (i) will contribute to alleviating the peril to the national health and safety which attends the continuation of the coal emergency, and (ii) in his judgment (A) will best meet the coal emergency and (B) will serve the public interest.

(3) "Interstate pipeline" means any natural-gas company, as defined in section 2(6) of the Natural Gas Act, which is engaged in the transportation by pipeline of natural gas.

(4) "Intrastate pipeline" means any person (other than an interstate pipeline) engaged in the transportation by pipeline of natural gas.

(5) "Local distribution company" means any person (including a governmental entity) which receives natural gas for local distribution and resale to natural gas users.

(6) "Administator" means the Administrator of the Economic Regulatory Administration, or any officer or employee of the United States designated by him.

(7) "Coal emergency period" means the period beginning on March 15, 1978, and ending midnight, April 30, 1978.

(c) Determination of eligibility. Any determination of the Administrator under paragraph (b)(2) of this section shall be in writing and shall be transImitted to the Commission and to the requesting parties.

(d) Exemption of certain transportation arrangements. The public interest does not require the issuance of a certificate under section 7 of the Natural

Gas Act authorizing the transportation or sale in interstate commerce of natural gas sold by a qualifying seller to an eligible electric utility for delivery commencing during the coal emergency period and ending not later than 60 days after deliveries commence or May 31, 1978, whichever occurs first. Any interstate transportation or sales contract, as appropriate, under this section shall be subject to the following terms and conditions:

(1) Notwithstanding any outstanding Commission order, approved settlement agreement or approved tariff governing transportation services by an interstate pipeline rendering transportation services under this section (hereafter in this section referred to as "transporter"), a transporter may charge and retain an amount for such transportation equal to actual out-ofpocket expenses. Out-of-pocket penses may include those administrative and general expenses directly associated with such transportation. The purchaser shall provide volumes of natural gas for compressor fuel and for volumes lost and unaccounted for.

ex

(2) Any contract for transportation or sale under this section shall provide that the Commission upon request of the transporter or upon its own motion shall have the authority to authorize the transporter to purchase the transported gas for system supply on those days on which the Commission determines the transporter (or local distribution companies served by the transporter) requires such gas for protection of the public health and safety. The transporter may not purchase the transported gas except upon 2 days' notice by the Commission to the eligible electric utility whose gas is to be purchased. If the transporter purchases gas under this subparagraph, the purchase shall be deemed to be a transaction under 18 CFR 2.68, 157.22 or 157.29, as appropriate.

(3) Transportation pursuant to this section shall be subject to interruption by the transporter to the extent the transporter has inadequate capacity available to maintain adequate service to existing customers.

(4) Within 24 hours after commencement of deliveries pursuant to this sec

tion, the transporter shall notify the Commission and the Administrator, by telegram, identifying: (i) the amount of gas to be transported (on a daily basis), (ii) the duration of the transportation, (iii) the date upon which deliveries are to commence, (iv) the seller, (v) the purchaser, (vi) the price of the gas, (vii) the transportation charges and calculations showing their derivation, and (viii) the pipelines participating in the transportation service.

(5) Within 10 days after the termination of deliveries, the transporter shall file with the Commission and the Administrator a sworn statement and four conformed copies thereof setting forth the volume of gas delivered and indicating: (i) the total compensation received by the seller, (ii) the rate schedule applicable to the sale, if any, or, alternatively, the method by which the price per Mcf was derived, (iii) the total amount of compensation received by the transporter (including amounts received for lost or unaccounted for volumes), (iv) the method by which the transporter's compensation was derived, and (v) a detailed description of the end-use of the gas.

[Order 4, 43 FR 11693, Mar. 21, 1978]

EFFECTIVE DATE NOTE: The provisions of § 157.42 expire May 31, 1978.

ADJUSTMENTS OF ACCOUNTS AND REPORTS

§ 158.1 Notice of deficiencies.

If, as the result of an examination by a representative of the Commission of the accounts of a person subject to the act and to the Commission's accounting requirements, or of an examination of any statement or report submitted by such person, it appears that the accounts, or any books or records pertaining to or in support thereof, are not being kept and maintained as required by the Commission, or that the statements or reports prepared and submitted are not in proper form, the failure or deficiency will be called to the attention of such person either formally or informally as the circumstances appear to warrant.

§ 158.2 Response to notification.

If, as the result of such formal or informal notice, the matter is not adjusted within the time fixed by said notice, or within a reasonable time in case no date is specified, or if there is a disagreement between such person and the Commission or its representative respecting the application or interpretation of the act or requirements of the Commission with respect to the matter at issue, such person will be requested to advise the Commission in writing within a time to be specified whether it consents to the disposition of the questions involved under the shortened procedure hereinafter provided.

§ 158.3 Facts and argument.

If the person consents to the matter being handled under such shortened procedure, the person and any other parties interested, including representatives of the Commission, shall submit to the Commission, within 30 days after the receipt of notice from the Commission to do so, a memorandum of the facts and, separately stated, of the argument relied upon, to sustain the position taken respecting the matter at issue together with copies in sufficient number to enable the Commission to retain three copies for its own use and make service in accordance with § 1.17 of this chapter

upon all parties designated in said notice. Twenty days will be allowed in which to file a reply by any party who filed an original memorandum.

§ 158.4 Form and style.

All memoranda must conform to the requirements of § 1.15 of this chapter, and each copy must be complete in itself. All pertinent data should be set forth fully, and each memorandum should set out the facts and argument as prescribed for briefs in § 1.29 of this chapter.

§ 158.5 Verification.

The facts stated in the memorandum must be sworn to by persons having knowledge thereof, which latter fact must affirmatively appear in the affidavit. Except under unusual circumstances, such persons should be those who would appear as witnesses if hearing were had to testify as to the facts stated in the memorandum.

§ 158.6 Determination.

If no formal hearing is had the matter in issue will be determined by the Commission on the basis of the facts and arguments submitted.

§ 158.7 Assignment for oral hearing.

In case consent to the shortened procedure is not given, or if at any stage of the proceeding prior to the submission of the case to the Commission any party in interest requests a hearing, the proceeding will be assigned for hearing as provided for by § 1.20 of this chapter. The Commission may also in its discretion set the proceeding for hearing on its own motion at any stage thereof.

§ 158.8 Burden of proof.

The burden of proof to justify every accounting entry shall be on the person making, authorizing, or requiring such entry.

CERTIFICATION OF COMPLIANCE WITH ACCOUNTING REGULATIONS

§ 158.10 Examination of accounts.

(a) All Class A and Class B natural gas companies shall secure for the year 1968 and each year thereafter

until December 31, 1975, the services of an independent certified public accountant, or independent licensed public accountant, certified or licensed by a regulatory authority of a State or other political subdivision of the United States, to test compliance in all material respects of those schedules as are indicated in the General Instructions set out in the Annual Report, Form No. 2, with the Commission's applicable Uniform System of Accounts and published accounting releases. The Commission expects that identification of questionable matters by the independent accountant will facilitate their early resolution and that the independent accountant will seek advisory rulings by the Commission on such items. This examination shall be deemed supplementary to periodic Commission examinations of compli

ance.

(b) Beginning January 1, 1976, and each year thereafter, only independent certified public accountants, or independent licensed public accountants who were licensed on or before December 31, 1970, will be authorized to conduct annual audits and to certify to compliance in all material respects, of those schedules as are indicated in the General Instructions set out in the Annual Report, Form No. 2, with the Commission's applicable Uniform System of Accounts, published accounting releases and all other regulatory matters.

(Sec. 10, 52 Stat. 826; 15 U.S.C. 717i)
[Order 462, 37 FR 26006, Dec. 7, 1972]

§ 158.11 Report of certification.

Each Class A or B natural gas company shall file with the Commission a letter or report of the independent accountant certifying approval, together with or within 30 days after the filing of the Annual Report, Form No. 2, covering the subjects and in the form prescribed in the General Instructions of the Annual Report. The letter or report shall also set forth which, if any, of the examined schedules do not conform to the Commission's requirements and shall describe the discrepancies that exist. The Commission shall not be bound by a certification of compliance made by an independent

accountant pursuant to this paragraph.

(Sec. 10, 52 Stat. 826; 15 U.S.C. 717i) [Order 356, 33 FR 143, Jan. 5, 1968]

§ 158.12 Qualifications of accountants.

The Commission will not recognize any certified public accountant or public accountant through December 31, 1975, who is not in fact independent. Beginning January 1, 1976, and each year thereafter, the Commission will recognize only independent certified public accountants, or independent licensed public accountants who were licensed on or before December 31, 1970, who are in fact independent. For example, an accountant will not be considered independent with respect to any person or any of its parents or subsidiaries in who he has, or had during the period of report, any direct financial interest. The Commission will determine the fact of independence by considering all the relevant circumstances including evidence bearing on the relationships between the accountant and that person or any affiliate thereof.

(Sec. 10, 52 Stat. 826; 15 U.S.C. 717i) [37 FR 26006, Dec. 7, 1972]

159.1 Filing fee to accompany application. 159.2 Applications involving construction or acquisition of facilities. 159.2a Annual charges. 159.3 Miscellaneous.

159.4 Accounting for fees paid pursuant to this part.

AUTHORITY: Secs. 1(c), 3, 7, 16, 52 Stat. 822, 824, 830, 56 Stat. 83, 68 Stat. 36, sec. 501, 65 Stat. 290, sec. 5, 67 Stat. 464, 15 U.S.C. 717(c), 717b, 717f, 717g, 7170, 31 U.S.C. 483a, 43 U.S.C. 1334(c), E.O. 10485, 3 CFR, 1949-1953 Comp., p. 970.

§ 159.1 Filing fee to accompany application.

A filing fee of $50 shall accompany each of the following:

(a) Applications for exemption under section 1(c) of the Act;

(b) Applications to import or export natural gas under section 3 of the Act; (c) Applications for permits under Executive Order 10485;

(d) Applications and petitions to intervene in which applicant or petitioner is requesting an order under section 7(a) of the Act.

(e) Applications for permission and approval to abandon under section 7(b) of the Act;

(f) Applications for certificates of public convenience and necessity under sections 7 (c) and (e) of the Act.

(g) Applications for determinations by the Commission under section 5 of the Outer Continental Shelf Lands Act; and

(h) Amendments to any of the applications listed in paragraphs (a) through (g) of this paragraph and those referred to in § 159.3(c).

[Order 317, 31 FR 431, Jan. 13, 1966, as amended by Order 317-A, 31 FR 4890, Mar. 24, 1966]

§ 159.2 Applications involving construction or acquisition of facilities.

In addition to the fees prescribed by § 159.1, and except as provided in paragraph (e) of this section, applicants for a certificate of public convenience and necessity under section 7 (c) and (e) of the Act to construct and operate or acquire and operate facilities shall pay the following fees:

(a) Within 30 days following issuance of notice of application, an amount equal to sixty-five one-thousandths of 1 percent (0.00065) of the estimated cost of construction of new facilities or of facilities to be acquired;

(b) Within 30 days following grant of the certificate, an amount equal to one hundred and thirty one-thousandths of 1 percent (0.00130) of the estimated cost of construction of new facilities or of facilities to be acquired, unless applicant does not accept the certificate.

(c) If an amendment to a pending application increases the total estimated cost of construction of new facilities or of facilities to be acquired, an additional amount, computed with respect to the increase as provided in paragraph (a) of this section, shall accompany the filing of the amendment.

(d) If the actual cost of construction of new facilities or of facilities to be acquired exceeds the estimated cost thereof, the statement of actual cost, required to be submitted by § 157.20(c)(4) and (d)(3) of this chapter, shall be accompanied by an amount equal to one-hundred and ninety-five one-thousandths of 1 percent (0.00195) of the excess of actual cost (plus estimated cost of facilities for which actual cost is not then recorded on the books of applicant) above estimated cost.

(e) No fee shall be required under tnis section where the estimated cost of the facilities to be constructed or acquired is less than $7,000.

[Order 317-A, 31 FR 4890, Mar. 24, 1966; as amended at Order 427, 36 FR 5598, Mar. 25, 1971]

§ 159.2a Annual charges.

Reasonable annual charges will be assessed by the Commission against natural gas companies to reimburse the United States for costs of administration of the Natural Gas Act, as hereinafter provided:

(a) A determination shall be made for each fiscal year of the costs of administration of the Commission's natural gas pipeline programs from which shall be deducted the amounts received during the same period pursuant to the provisions of §§ 159.1 and 159.2. The difference shall constitute the adjusted costs of administration of such programs for such period.

(1) The adjusted costs of administration determined under this paragraph (a) shall be assessed against each Class A and Class B natural gas company in the proportion that the total jurisdictional gas deliveries of such natural gas company in the calendar year terminating in such fiscal period bear to the sum of the jurisdictional gas deliveries of all Class A and Class B natural gas companies for the like period.

(b) In addition to the annual charges prescribed in paragraph (a) of this section, each natural gas company required to file an Annual Report-Total Gas Supply on FPC Form No. 15 shall be assessed one-tenth (10) of a mill for each Mcf of new reserves certificated during the year covered by said

report as shown for item 14 of such form.

(c) Annual charges assessed under this section shall be paid within 60 days of the rendition of a bill therefor by the Commission.

[Order 427, 36 FR 5598, Mar. 25, 1971]

§ 159.3 Miscellaneous.

(a) Method of payment. Annual assessments and fee payments shall be made by check or money order payable to the Treasurer of the United States. No fees will be refunded.

(b) Exemption. The provisions of this part shall not apply to independent producers as defined in § 154.91(a) of this chapter.

(c) Amendments to outstanding certificates. Excepting applications for extensions of time for which no fee will be required, applications to amend outstanding certificates, authorizations or orders, which have become final, will be treated as initial applications and the fees prescribed by this part will be charged.

(d) Temporary certificates. Applications for temporary certificates, filed pursuant to § 157.17 of this subchapter, and not a part of an initial certificate application, or to amend outstanding temporary certificates will be treated as amendments to applications for the purposes of this part and a filing fee of $50 will be charged unless the request for temporary authority amends the original application to increase the estimated costs, in which case the provisions of § 159.2(c) will apply.

[Order 317, 31 FR 432, Jan. 13, 1966, as amended by Order 317-A, 31 FR 4890, Mar. 24, 1966; Order 427, 36 FR 5598, Mar. 25, 1971]

§ 159.4 Accounting for fees paid pursuant to this part.

A natural gas company subject to the provisions of this part shall account for the fees paid as follows:

(a) The fee for applications not involving the construction of facilities ($50.00 for each application or amendment thereto) shall be charged to Account 928, Regulatory commission expenses.